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Tag: Finance

  • Vietnamese consumers among the most optimistic in the world

    Vietnamese consumers among the most optimistic in the world

    Vietnamese consumer confidence has reached a global high thanks to optimism over jobs and personal finances. The Vietnam Consumer Confidence Index has risen by nine points from the second quarter to reach an all-time high at 129 points in the third quarter of 2018, according to the Global Consumer Confidence Survey.

    The survey results have been released by research association The Conference Board in collaboration with global market research company Nielsen.

    The survey ranks the country in second place in the world in terms of consumer confidence, behind India at 130 points.

    While most Asian economies are vulnerable to the ongoing trade dispute between China and the U.S., Vietnam is a possible exception, as it may attract parts of the global value chain that currently run through China, the report said.

    The rise in the confidence index is also due to greater optimism about employment prospects, personal finances and the level of willingness to spend.

    Eight out of ten Vietnamese surveyed said that they were positive about their job prospects, up nine percentage points from the second quarter.

    Eighty-two percent of respondents expected their personal finances will be good or excellent over the next 12 months, up 6 percentage points from the second quarter.

    The majority of them, 63 percent, said that the next 12 months are a good time for them to buy the things that they want and need, 8 percentage points higher than the second quarter.

    Concerns about having a stable job and health (both at 40 percent) remained the top concerns among Vietnamese consumers. The national economy came in third at 27 percent, 5 percentage points higher than the previous quarter.

    Vietnamese consumers continue to take the lead globally when it comes to saving, the survey found. Seventy-two percent of respondents said that they would save their spare cash, up two percent from the second quarter.

    But Vietnamese people are also more willing to spend on big-ticket items. The percentage of people who would spend their spare cash on home improvements increased 10 percent from the second quarter to 48 percent.

    Over half of them, 53 percent, want to spend the money on new clothes, up 7 percentage points from the second quarter.

    Nguyen Huong Quynh, managing director of Nielsen Vietnam, said that when consumers faced multiple concerns, their purchasing decisions will be affected and businesses should always keep a close track on changes in the spending habits of consumers.

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  • First Binance Blockchain Week Set for Singapore Next Month

    First Binance Blockchain Week Set for Singapore Next Month

    About 2,000 people from around the world are expected to attend the inaugural Binance Blockchain Week in Singapore on Jan. 19-22. The conference, which will take place at the Sands Expo and Convention Centre in Marina Bay Sands, is presented by Binance, the world’s leading cryptocurrency exchange.

    The high-profile event will serve as a platform to bring together regulators, investors, academics, entrepreneurs and technologists to discuss the current blockchain ecosystem and encourage sustainable growth in the industry.

    Binance Blockchain Week will feature more than 70 speakers, including thought leaders, top executives, academics and heads of state in a productive, yet exciting program filled with keynote speeches, panel discussions, fireside chats and exclusive networking events.

    Confirmed speakers include Changpeng Zhao, the founder and chief executive of Binance; Genping Liu, partner at Vertex Ventures; Justin Chow, head of business development, Asia at Cumberland; and Sonia Bashir Kabir, managing director of Microsoft Bangladesh, Myanmar, Nepal, Bhutan and Laos.

    “We are thrilled to host the first ever Binance Blockchain Week in Singapore, the finance and technology hub of Asia. Gathering the most notable players and thought leaders in blockchain, this will be a defining event. We look forward to many thought-provoking discussions and debates on how we can further work together to move the industry forward,” Zhao said.

    There will also be an expo featuring more than 50 booths for sponsors to showcase the best blockchain and cryptocurrency technologies.

    Secure Asset Funds for Users Hackathon

    The inaugural Binance SAFU Hackathon, which aims to seek innovative blockchain solutions to secure crypto assets, will take place at the offices of PricewaterhouseCoopers Singapore in Marina One East Tower on Jan. 19-20.

    The panel of judges includes PwC, blockchain accelerator program Tribe Accelerator and Binance Labs. Participants will have the opportunity to receive mentorships from senior leaders at companies such as the Ethereum Foundation, Primitive Ventures, Earn.com, Binance Labs and IDEO CoLab.

    Individuals and teams interested in participating in the event can submit their applications between Dec. 10 and Jan. 6.

    Twenty developer teams will be selected via pre-hackathons and direct registration on the event website. Pre-hackathons will be held around the world between December and early January.

    Only winning teams will qualify for free passes to the final SAFU Hackathon in Singapore.

    The teams winning the final will share a prize pool of $100,000 in Binance Coin (BNB) courtesy of Binance.

    For more information, check out the Binance Blockchain Week Facebook page or the cryptocurrency exchange’s Twitter profile.

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  • Malaysia’s CIMB to gain RM200m from stockbroking business transfer

    Malaysia’s CIMB to gain RM200m from stockbroking business transfer

    CIMB Group Holdings Bhd is expected to record a gain of disposal of approximately RM200 million from the process of transferring the group’s stockbroking business to its joint venture company with China Galaxy Securities Co Ltd.

    This comes after taking into account the premium on the disposal of approximately RM433 million and goodwill attributable to the business.

    CIMB said the consideration in connection with the proposed business transfer will be satisfied in cash and it was determined based on the future prospects and net asset value of the in-scope business as at Dec 31, 2015, which amounted to RM565.6 million.

    The consideration is subject to closing audit adjustments, if any.

    Jupiter Securities, the subsidiary of China Galaxy Securities Co Ltd (CGS)-CIMB Holdings Sdn Bhd, which is the Malaysian joint venture entity, will operate the stockbroking business.

    CIMB said in a stock exchange filing that its wholly owned subsidiary CIMB Group Sdn Bhd (CIMBG), China Galaxy’s wholly owned unit China Galaxy International Financial Holdings Ltd (CGI), and CGS-CIMB Holdings Sdn Bhd has inked a share subscription agreement for the subscription of new shares in CGS-CIMB Holdings Sdn Bhd.

    The proposed business transfer entails the sale of CIMB Investment Bank Bhd’s cash equities business and 100% equity interest in CIMB Futures Sdn Bhd as well as CIMB Bank Bhd’s equity financing services business and share margin financing granted in connection with the cash equities to Jupiter Securities.

    After the completion of the exercise, CIMBG and CGI will hold 50% stake each in the Malaysian JV entity.

    The exercises are expected to be completed in the first half of 2019.

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  • BTS adds 4 trillion won to the Korean economy

    BTS adds 4 trillion won to the Korean economy

    Popular boy band BTS’s annual economic value is estimated at over 4 trillion won ($3.5 billion), making it more lucrative than a medium-sized company. The group’s annual production inducement effect, which refers to the value generated in related industries, is estimated at around 4.1 trillion won, according to a report by Hyundai Research Institute (HRI) released Monday.

    “BTS was the first Korean artist to place at No. 10 on the Billboard Hot 100 and reach No. 1 on the Billboard 200,” read the report. “The group’s rising fame and popularity can be observed in the explosively growing number of Google searches and YouTube video counts after 2017.”

    “Expecting such growth in popularity to have a positive effect on the Korean economy, we wanted to estimate the impact of BTS’s popularity on the domestic economy by assessing foreign tourists and consumer exports.”

    Research findings revealed that the HRI’s assumptions were correct. According to the report, BTS is responsible for attracting at least 796,000 foreign tourists annually to Korea since their debut in 2013. The report also credits the group for increasing sales of related exports by $1.1 billion every year, including $233.98 million worth of clothing, $426.64 million worth of cosmetics and $456.49 million worth of foodstuffs.

    BTS’s estimated annual economic value of 4.1 trillion won is 26 times larger than the average medium-sized company in Korea, which earned just 159 billion won in 2016 according to the report.

    The HRI report also discussed the factors believed to be behind the success of the group.

    “All BTS members participate in the songwriting and composing, often writing from their own perspective the concerns of young adults in their teens and twenties, and listeners are able to sympathize with them regardless of their nationality,“ read the report. “BTS’s albums and concerts are also structured in a way that has a narrative, which helps attract the attention of fans and raise their expectations for upcoming albums and concerts as well.”

    Other factors mentioned include active communication with BTS fans – known as ARMY – through social media and the fans’ strong support.

    BTS is expected to produce an accumulated total of 41.8 trillion won in economic value between 2014 and 2023 if it maintains its average popularity level of the last five years.

    “In order to maximize the economic impact of Hallyu [Korean wave], it’s necessary to develop and promote domestic tourism through dramas, movies and videos and raise demand from foreign tourists,” the report concluded.

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  • World Bank cuts Malaysia’s 2018 GDP growth forecast again

    World Bank cuts Malaysia’s 2018 GDP growth forecast again

    The World Bank has again revised downward its projection for Malaysia’s 2018 gross domestic product (GDP) growth to 4.7% from 4.9% after taking into account factors such the rigorous rationalisation of expenditure by the government and slowdown in private and public investment. It last cut the country’s GDP growth forecast in October, to 4.9% from 5.4%.

    Malaysia’s third quarter GDP growth moderated to 4.4%, bringing about a nine-month expansion of 4.7%.

    Despite a moderation in growth, the World Bank believes that the Malaysian economy remains resilient and continues to be anchored by private consumption, although it has been cooling down after the reintroduction of the sales and service tax.

    The key drivers for private consumption are stable labour market conditions, cost of living aid and tax refunds payment.

    Private investment in the manufacturing and commodity sectors are also expected to be sustained.

    Speaking at the launch of the World Bank’s Malaysia Economic Monitor on Realising Human Potential Report, World Bank Group economist Shakira Teh Sharifuddin said Malaysia’s economic growth is projected to remain flat at 4.7% in 2019, with external factors such as current trade tensions and increased volatility in the financial and commodity markets expected to weigh on the overall economy.

    In addition to the escalating trade tensions, monetary normalisation in advanced economies, high dependency on oil revenue and high level of public debt are seen as potential risk for the government.

    The percentage of the federal government’s revenue to GDP has seen a steep decline between 2012 and 2018, falling from 21.4% to 16.2%. In 2019, the share of revenue to GDP is expected to be reduced further to 15.1%.

    This, Shakira said, leaves the government with limited space to respond to economic shocks.

    In the near term, the government is expected to rigorously embark on fiscal consolidation measures with expenditure expected to decline to 18.1% of GDP from the 2018 estimate of 20.3%.

    Shakira said that while the introduction of new taxes in the budget is welcomed, the government should relook the incentive mechanisms.

    On another note, the World Bank stressed on the need for Malaysia to accelerate the development of its human capital if it wishes to join the ranks of a high-income nation.

    While Malaysia, which ranked 55th out of 157 countries in the Human Capital Index, fared well in some areas, there is room for improvement in certain areas, noted the report.

    It also states the prevalence of stunting among Malaysian children which affect more than one in five Malaysian children, a key indicator of malnutrition. In the absence of renewed efforts to develop human capital, a child born today in Malaysia will only reach a productivity level of 62%.

    In terms of education, the 12.2 years spent by Malaysians in school only equates to the 9.1 years learning outcome of school goers in the highest performing system.

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  • November inflation seen easing to 0.5%

    November inflation seen easing to 0.5%

    Malaysia’s consumer price index (CPI) is expected to rise 0.5% in November from a year earlier, a Reuters poll showed, marginally slower than the previous month amid lower transport prices. Inflation has been mild since the government removed an unpopular consumption tax in June and reinstated a narrower sales and services tax (SST) three months later.

    The annual inflation rate was 0.6% in October. It has been rising after hitting a three-and-a-half year low of 0.2% in August.

    Economists expect any pickup in inflation due to the reintroduction of SST to be muted, softened further by the government’s decision to fix pump prices for premium RON95 petrol for the rest of the year.

    Last month, Malaysia’s central bank said inflation had been largely benign in the third quarter, but was expected to edge upwards the rest of the year and into 2019.

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  • Cath Kidston Japan surges but not enough

    Cath Kidston Japan surges but not enough

    Cath Kidston Japan sales outperformed every other market in the year to March, but not enough to stem losses by the UK-based company. Sales in Japan rose by 5.4 per cent after a net four new stores took the brand’s network there to 32. Ten more Cath Kidston Japan stores are planned there next year.

    In China, Cath Kidston also performed well, aided by a new franchise deal which will see 50 shops opened over the next five years.

    “The brand clearly continues to resonate with our loyal customer base, particularly in the UK and Asia,” said CEO Melinda Paraie.

    “During the period the group continued to grow top-line sales, despite significant headwinds in some of the markets in which we operate,” she said.

    “We are particularly pleased with the significant growth in ecommerce sales in both Japan and the UK, where a strong performance on Black Friday contributed to our best-ever week online.”

    Despite the positive Asian results, Cath Kidston’s loss rose from £8.4 million in the 2017 financial year to £10.5 million this year. Paraie blamed “increased cost pressures from the weaker sterling” since the Brexit vote for the result. Worldwide sales rose 1.2 per cent to £130.7 million, with UK sales up by 5.1 per cent.

  • South Korea’s Kookmin Bank licensed to open Vietnam branch

    South Korea’s Kookmin Bank licensed to open Vietnam branch

    The State Bank of Vietnam has licensed South Korea’s Kookmin Bank to open a branch in Hanoi, the government said on Tuesday. The branch has a chartered capital of $35 million and the contract runs for 99 years, the government said in a statement.

    South Korea is the largest source of foreign direct investment in Vietnam and the Southeast Asian country’s second largest trading partner.

  • Vietnamese currency falls to new low, could go lower

    Vietnamese currency falls to new low, could go lower

    The official exchange rate between Vietnamese dong and U.S. dollar reached its highest this year Wednesday, and  experts said the dong could depreciate further. The State Bank of Vietnam set a central exchange rate of VND22,757 on Wednesday, the sixth time the rate has gone up in the last two weeks.

    The dong has fallen by VND352, or 1.57 percent, against the greenback since the beginning of the year.

    The dollar’s value increased at commercial banks. At 3p.m. Wednesday, Vietcombank sold the dollar for VND23,350, VND15 higher than Tuesday.

    Vietinbank also sold its dollar for VND23,350, VND17 higher than Tuesday, while BIDV sold it at VND23,355, VND25 higher.

    The dollar also inched up on the free market. At 11.30 a.m. Wednesday, it was selling for VND23,360-23,410, VND10-20 higher than on Tuesday.

    Economist Nguyen Tri Hieu said that the reason for the hike was high demand for dollars toward the end of the year as businesses often import large amounts of materials needed for manufacturing.

    The ongoing U.S.-China trade war continues to exert exchange rate pressures, despite the U.S. announcing a 90-day halt on additional tariffs on Chinese goods starting next year, as there is no certainty that tensions will decline, he said.

    “There is a high possibility that the dong’s value will continue to fall this year,” Hieu said.

    Hieu said that the government should also devaluate the dong against the Chinese yuan so that the trade deficit between Vietnam and China can be reduced.

    Vietnam relies heavily on China for materials and equipment for its labor-intensive manufacturing sector.

    As the yuan’s value has fallen by 9 percent to the dollar since the beginning of this year, some experts have said that the dong should be devaluated even more to avoid impacts a cheaper yuan. Cheap made-in-China goods could be imported in large quantities to Vietnam and compete with domestic products, they said.

    But economist Tran Dinh Thien said that the dong should be kept at a balanced rate between the U.S. dollar and the Chinese yuan. A 2-3 percent band a year is acceptable, he added.

    A stronger dollar will benefit exporters, but will also create stronger pressure on inflation and interest rates which will increase business costs in a country with high imports and public debt, Thien said at a recent conference.

    He added that the fluctuation of the dong should be controlled to help local companies conduct their business with greater certainty.

    The government doesn’t want businesses to suffer shocks, he said.

    Prime Minister Nguyen Xuan Phuc had said in August that the devaluation of the dong needs to be kept within a 2-percent band this year compared with the end of last year.

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  • Indonesia’s November Inflation Rate Surprisingly Picks Up

    Indonesia’s November Inflation Rate Surprisingly Picks Up

    Indonesia’s annual inflation rate accelerated for a second straight month in November, the statistics office said on Monday, against an expectation for price pressures to ease. The consumer price index rose 3.23 percent in November from a year earlier, Central Statistics Agency (BPS) chief Suhariyanto said, attributing the increase to rising prices of some food products and airfares. On a monthly basis, it rose 0.27 percent.

    October’s rate was 3.16 percent, while a Reuters poll had expected a November annual inflation rate of 3.15 percent.

    The November rate was still well within the central bank’s target range of 2.5 percent to 4.5 percent for 2018.

    The annual core inflation rate, which excludes government-controlled and volatile prices, also picked up more than expected in November to 3.03 percent, from 2.94 percent in October. The poll had expected a core inflation rate of 2.97 percent.

    Bank Indonesia has hiked interest rates six times this year by a total of 175 basis points since May to support the rupiah, despite benign inflation. The currency plumbed levels not seen since 1998 earlier this year but has sharply strengthened last month due to improving global investor sentiment.

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  • Vietnam eyes $10,000 per capita income by 2035

    Vietnam eyes $10,000 per capita income by 2035

    Vietnam has set target of increasing GDP per capita to $6,500 in 2030, and $10,000, or four times the current value, in 2035. The GDP in those years would then be $670 billion and $1.05 trillion, according to an economic policy framework for the period up to 2035 recently issued by the Ministry of Planning and Investment. This will make Vietnam an upper middle-income country.

    Vietnam has also targeted to reduce its poverty rate to 1 percent and increasing the middle-class rate to 50 percent by 2035.

    The middle and affluent class now is categorized as those earning $714 a month or more, according to the Boston Consulting Group.

    According to the document, encouraging the continued development of the private sector and developing human resources and innovations taking advantage of the Fourth Industrial Revolution would be two of the driving forces for economic growth.

    The country hopes to have two million private businesses that contribute 50 percent of its GDP by 2020 and 60-65 percent by 2030.

    The reforms to achieve these goals will focus on modernizing the economy and developing the private sector, building innovation capacity, improving economic efficiency of urbanization, and building modern institutions and efficient governance.

    Vietnam also aims to ensure its development is environmentally sustainable and equitable, promote social inclusion and enhance its adaptability to climate change.

    Minister of Planning and Investment Nguyen Chi Dung said strong reforms are needed to continue developing and not fall behind the times.

    Speaking to Vietnam’s development partners at a forum on reform and development Wednesday, Prime Minister Nguyen Xuan Phuc said: “We have the aspiration to become a prosperous economy, but we are fully aware that the road will be uneven with many challenges. Those are the challenges from both within the economy and the impacts caused by fluctuations in the global economy.”

    To address these issues he pledged his government would soon speed up administrative reform and establish an economic system that enables all economic entities to have the right to participate in making development plans and policies.

    “Vietnam will focus on building its soft and digital infrastructure to convert the economy into a digital one, reform its recruitment mechanism and focus on training human resources to make use of the fourth industrial revolution as a driving force for growth.”

    According to World Bank Group statistics, Vietnam’s GDP per capita in 2017 is $2,343. The figure for Singapore is $57,714, Malaysia ($9,945), Thailand ($6,594), the Philippines ($2,989) and Myanmar ($1,298).

    Minister Dung estimated that Vietnam’s GDP would grow by 6.57 percent on average in the 2016-2018 period, meeting the National’s Assembly target of 6.5-6.7 percent growth.

    In the first nine months this year, Vietnam’s GDP grew by 6.98 percent, the highest nine-month growth rate since 2011. The economy grew by 6.81 percent last year, the highest rate in a decade.

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  • Visa Thailand to strengthen security in payment

    Visa Thailand to strengthen security in payment

    Visa, the world’s leader in digital payments, has today launched its Future of Security Roadmap for Thailand, outlining a robust approach for strengthening payments security in the country over the next 3 years. Visa’s Roadmap focuses on a number of key initiatives which will enable security to evolve at the same pace as the technologies changing the way we pay. These security initiatives include:

    • Devalue data by removing the sensitive data from the ecosystem and making stolen account details useless.
    • Protect data by implementing safeguards to protect personal data as well as account details.
    • Harness data by identifying potential fraud before it occurs and increase confidence in approving good transactions.
    • Empower everyone, including accountholders, 3rd party providers and merchants, to play an active role in securing payments.

    Suripong Tantiyanon, Country Manager, Visa Thailand said: “We are proud to be launching our Thailand Future of Security Roadmap. Securing the commerce ecosystem is our highest priority and one we view as a shared responsibility between payment networks, consumers, banks, and the government. Technology has enabled new innovative ways to pay and be paid, but it has also brought unique risks. To stay ahead of fraud, we need to work together and give security the same attention and investment as we do the innovations driving new commerce experiences.”

    The release of Visa’s Roadmap comes at a time of rapid change for payments in Thailand with innovations such as mobile payments set to enhance the payment experience for consumers. According to Visa’s Consumer Payment Attitudes Study, security remains a key consideration for consumers across Southeast Asia with two-thirds (67 percent) concerned about the safety of their personal information when using their mobile phone to make payments.

    When asked specifically about what their top three concerns were when using their mobile phones to make payments, consumers in Thailand said losing my phone or having my phone stolen, my phone getting hacked or someone intercepting my data, and malware or viruses being installed on my phone.

    Visa works with industry stakeholders including financial institutions, merchants, policy makers, law enforcement and accountholders to secure payments. The Visa Future of Security Roadmap is the product of comprehensive consultations and collaboration, making it an authoritative document on Thailand payments security.

    Visa is delivering roadmaps around the world to ensure the security of the global commerce ecosystem, as well as working with Thai industry bodies to align security initiatives.

     

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  • Vietnam Airlines eyes stock market listing in 2019

    Vietnam Airlines eyes stock market listing in 2019

    Vietnam Airlines plans to list its shares on the Ho Chi Minh City Stock Exchange next year amidst rising competition of low-cost carriers. “Vietnam Airlines will go public in the first quarter of next year,” its chief executive, Duong Tri Thanh said. “We are making our target the first quarter of next year, and I think it is feasible.”

    But he admitted the final decision rests with the government.

    The carrier’s shares are traded on Hanoi’s Unlisted Public Company Market (UPCoM) and it has a market capitalization of more than $2 billion.

    The government currently owns around 86 percent of Vietnam Airlines, but has said it wants to reduce this to 51 percent by 2020.

    The country’s largest airline by passengers carried now faces rising competition from budget carrier VietJet Aviation and others. Last month Vietjet became the second most valuable airline in Southeast Asia by market cap behind only Singapore Airlines.

    With the domestic market showing signs of saturation, Vietnam Airlines seeks to expand overseas. In October it started a daily service from central Da Nang City to Osaka City to add to the 70 weekly flights from Vietnam to Japan. In 2020 it plans to begin a direct service to the U.S.

    Vietjet launched a daily service from Hanoi to Osaka last month to take its total number of international routes to 64 in 11 countries. It plans to add two more routes to Japan by next month.

    Other airlines are also jostling for market share. Bamboo Airways, Vietnam’s newest airline, received a license last month and is set to make its maiden flight on December 29.

    Experts said the listing of Vietnam Airlines would allow it to compete with other carriers by attracting more investors.

    “This would be a major Vietnamese company joining the stock exchange, which would interest international investors and potentially enable Vietnam Airlines to raise funds more easily to compete with the likes of VietJet and Bamboo,” the Financial Times quoted Tony Foster, a partner at Hanoi law firm Freshfields, as saying.

    Vietnam’s international aviation market, driven by the rapid growth in tourism, has been expanding at more than 30 percent a year, according to the CAPA Centre for Aviation, an Australian consultancy.

    Vietnam welcomed 14.1 million international tourists from January to November, up 21.3 percent year-on-year, according to the General Statistics Office. As many as 11.4 million of them came by plane, up 15.3 percent, it added.

    Vietnamese carriers transported 45.1 million passengers between January and November, up 11.9 percent year-on-year, and 369.2 million tons of goods, up 18.6 percent, according to the General Statistics Office.

    There are five carriers in Vietnam: Vietnam Airlines, Vietjet Air, Bamboo Airways, Jetstar Pacific and VASCO. Vietnam Airlines owns VASCO and has a 70 percent stake in Jetstar Pacific.

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  • Vietnam must avoid power cuts next year: PM

    Vietnam must avoid power cuts next year: PM

    Prime Minister Vietnam Nguyen Xuan Phuc has ordered agencies to ensure that the country won’t suffer power shortages in 2019. The Prime Minister has communicated this to relevant agencies several times, Mai Tien Dung, Minister and Chairman of the Government Office, said at the government’s regular press conference on Monday.

    The communiqués have instructed the agencies to ensure that there’s no electricity shortage for both industrial and domestic uses, emphasizing they would be held responsible for failures, Dung said.

    The PM has also tasked relevant agencies with definitively resolving the ongoing issue of coal shortage for thermal power plants, which Vietnam Electricity (EVN) has warned could lead to power cuts early next year.

    The national power utility said in a recent report to Deputy Prime Minister Trinh Dinh Dung that the country will need over 54 million tons of coal for electricity production next year, of which 43.4 million tons will come from domestic production and 10.68 million tons will be imported.

    But the country’s only two suppliers, Vietnam National Coal-Mineral Industries Corporation (Vinacomin) and the North-Eastern Company (NECO) under the Ministry of Defense, will only be able to produce 37.21 million tons of coal next year, 6.19 million tons lower than estimated demand, EVN said.

    Speaking at the press conference, Deputy Minister of Industry and Trade Do Thang Hai said a total of four different electricity supply plans have been drafted, all of which designed to ensure there would be no power shortages next year.

    However, in certain cases, Vietnam would still need to produce 2-7 billion kWh of electricity from expensive oil-powered generators.

    “If we want to have enough electricity then we must increase the production of electricity by oil, which would be more expensive,” he said, asking consumers to make plans to save electricity.

    Regarding the issue of coal shortage, Hai asserted that Vinacomin and NECO have both supplied enough coal for thermal power plants as committed.

    “The two major coal suppliers have tried their best. If coal from domestic sources is not enough to supply [thermal power plants] then we will import more,” he said.

    The deputy minister also said a scenario for regulating electricity prices next year would be reported to the government later this month.

    “The electricity price for next year is being carefully considered and the scenario is being built in accordance with regulations, including factoring in the effect on inflation,” he said.

    Vietnam currently relies largely on hydropower and thermal power plants for its electricity needs. However, its hydropower potential is almost fully exploited and its oil and gas reserves are running low.

    Thermal energy is expected to account for over 48 percent of the country’s power production next year.

    Vietnam, one of Asia’s fastest-growing economies, has been struggling to develop its energy industry, and its heavy reliance on non renewable sources could prove problematic in the future, experts say.

    World Bank country director for Vietnam Ousmane Dione said at a recent forum that Vietnam will need to raise up $150 billion by 2030 to develop its energy sector; that electricity demand in the country will grow by about 8 percent a year for the next decade.

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  • Vietnamese government will share risks with startups, PM assures

    Vietnamese government will share risks with startups, PM assures

    The Vietnamese government is willing to make changes in regulations to facilitate timely funding of startups, Prime Minister Nguyen Xuan Phuc said. Addressing at the Youth Startups Forum 2018 in Hanoi on Thursday, he acknowledged the challenges that Vietnamese startups have highlighted, saying that it is the task of authorities to find a breakthrough solution for creative entrepreneurs to start and run a business.

    He asked the Ministry of Planning and Investment, the Ministry of Science and Technology, the Ministry of Finance and the State Bank of Vietnam to create more favorable conditions for startups by making changes in the legal framework.

    “We need a breakthrough innovation in policies from government bodies to help startups succeed with their ideas,” he told the forum, which attracted 300 entrepreneurs from across the country.

    The government is willing to share a part of the risks with startups, the PM added.

    He asked relevant ministries and other agencies to report in detail next month on the solutions they have identified for the problems that industry insiders have highlighted.

    Vietnam has seen an increasing number of startups in recent years. The country’s speed of startup development ranks third among ASEAN members. But regulatory obstructions are hindering their ability to attract funds they need to establish themselves and thrive in the market, entrepreneurs said at the forum.

    Thach Le Anh, founder of Vietnam Silicon Valley, a government-backed organization aiming to stimulate the growth of startups, said that angel investors are reluctant to invest due to a lack of incentives in tax and policies. Angel investors are people who inject money into a new business in the early stage.

    The early financial support is crucial for a startup to succeed, Anh said.

    Nguyen Manh Dung, a representative of the investment fund CyberAgent Veuntures in Vietnam, also said that many investors want to invest in Vietnam’s startups, as larger markets like the U.S., Japan and China require bigger capital and fewer opportunities.

    Investors are also reluctant about later stage investments, when profits can be extracted, because of slow administration procedures, he said.

    Disbursement procedures in Vietnam could take from six months to a year while the very nature of startups is that they need to act fast, he added.

    Dung also said that divestment was one the main concerns that investors have.

    “These challenges take opportunities away from startups,” he said.

    Dam Quang Thang, CEO of AgriTech Village, a company which assists local startups in agriculture, said that although startups often use new technological solutions, they have to go through a traditional testing method, which is more time consuming than it should be.

    A representative of Vietinbank, Vietnam’s fourth-biggest listed bank by market capitalization, said tight bidding procedures and long financial checks were preventing the bank from investing in a tech startup.

    “Startups struggle to sell their products to investors as they have to go through the traditional process. There must be a better way for them to sell their new solutions,” the representative said.

    Last year, Vietnamese startups received $300 million in investments in 92 different deals, according to startup accelerator program Topica Founder Institute (TFI).

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