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Tag: Vietnam

  • Vietnam scraps plan to merge stock exchanges

    Vietnam scraps plan to merge stock exchanges

    The nation’s two bourses in Ho Chi Minh City and Hanoi will continue to operate independently under a new state-owned company. Ho Chi Minh City Stock Exchange (HoSE) and Hanoi Stock Exchange (HNX) will operate independently under the Vietnam Stock Exchange, which will be set up by the Ministry of Finance by 2020. The new company, to be headquartered in Hanoi, will have a charter capital VND3 trillion ($129 million), on the basis of combining the charter capital of both exchanges.

    The Vietnam Stock Exchange will issue regulations on stock listings and trading, monitor the stock market and supervise the two bourses. This new plan indicates that Vietnam has given up on an earlier plan to merge the two exchanges, owing to disagreement over where the combined one would be located.

    HoSE accounts for 93 percent of the two main exchanges’ total market capitalization of about $131 billion as of December. It is the main market, where blue chips such as Vietnam’s biggest private conglomerate Vingroup, dairy company Vinamilk and budget carrier Vietjet Air are listed.

    HNX, on the other hand, is home to smaller and mid-sized enterprises, bonds and derivatives.

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  • Vietnam’s millionaire population growth among world’s fastest

    Vietnam’s millionaire population growth among world’s fastest

    Vietnam ranks fourth among the world’s top 10 countries with the fastest millionaire population growth, a new report says. The country’s High Net Worth (HNW) population is set to grow by 10.1 percent each year in the 2018-2023 period, says wealth research firm Wealth-X. This growth rate is only lower than Nigeria at 16.3 percent, Egypt, 12.5 percent and Bangladesh, 11.4 percent, says the report, which covered over 540,000 HNW individuals in the world.

    The report defines HNW population as those with a net worth between $1 million and $30 million. The world’s HNW population grew by 1.9 percent last year from 2017 to 22.4 million people with a combined wealth of $61.3 trillion.

    About 25 percent of the world’s HNW population were located in Asia last year, and their total wealth was $15.48 trillion.

    Although the region’s GDP went up 8 percent last year, its stock markets plunged by more than 11 percent, partly explaining why Asia’s HNW population and total wealth remained virtually unchanged from last year, the report said.

    It also said that the top 10 countries accounted for over 75.2 percent of the global HNW population and 73.8 percent of total HNW wealth last year.

    U.S. topped the list with over 8.6 million people, following by China with 1.8 million, Japan, 1.6 million and Germany over 1 million.

    In another report published last September, Wealth-X said that the number of ultra wealthy population, those with a net worth of over $30 million, has increased by 12.7 percent in Vietnam from 2012 to 2017, making it the third fastest growing country in the world in this category.

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  • Vietnam wants to excel in IT, telecom

    Vietnam wants to excel in IT, telecom

    Vietnam, which is in a lowly 108th place in the International Telecommunication Union’s ICT Development Index, wants to improve its status. Speaking at a Ministry of Information and Communications (MoIC) conference Tuesday, Prime Minister Nguyen Xuan Phuc emphasized the need for the country to improve its ranking in ICT, one of country’s strengths alongside agriculture and service.

    MoIC Minister Nguyen Manh Hung said the country must use the International Telecommunication Union’s rankings as a guideline and strive to improve to no lower than 50th latest by 2022.

    He stressed that to take the lead in the digital revolution, the country needs to popularize smartphones by licensing 4G and testing 5G technologies to increase capacity, data usage per user and the quality of the mobile network.

    “Vietnam must be on the same line with the world in new technologies. We will not be eight and 10 years behind like we were with 3G and 4G.”

    According to the minister, Vietnam’s development in telecommunications must remain sustainable by shifting resources to explore new markets once the phone market saturates instead of continuing to compete unhealthily on old markets.

    “Mobile money,” which the ministry is trialing now, allows users to transfer money and make purchases through their telecom accounts, and would help bring e-payment to everyone in the country and stimulate economic growth, he said.

    Digital transformation, e-governance and smart cities would be the big stories of 2019, he said.

    “National digital transformation, digital economy and digital society would be the overarching story for decades to come. We need to develop strategies and projects in 2019 to clarify what must be done for each field in the digital economy and the Fourth Industrial Revolution.”

    Speaking about cyber security and safety, he said the Internet, on which the country’s prosperity depends, is itself an unsafe environment.

    “In 2019 there will be no incidents of government agencies’ websites being hacked and having information stolen. Vietnam must become ASEAN’s center for cybersecurity.”

    Vietnam has an opportunity to become one of the world’s major manufacturers of electronic and telecom equipment, he said.

    Globally there are only four major telecom infrastructure and equipment manufacturers — Ericsson, Nokia, Huawei and ZTE – and while China’s Huawei and ZTE enjoy a market share of 60 percent, they are encountering difficulties with the U.S., he pointed out.

    “Vietnam is currently capable of manufacturing 70 percent of telecom equipment [used globally]. With effort, we could become the fourth nation in the world capable of manufacturing and exporting all types of telecom equipment. This must be achieved by 2019-2020.”

    “Vietnamese network operators must use Vietnamese-made equipment if the price and quality are similar.”

    The ministry has set a target of  20-30 percent of operators’ revenues coming from digital content this year instead of the current 6-8 percent, saying the digital content industry is capable of expanding by three or four times to achieve revenues of $3-4 billion.

    “The key to the digital content industry’s growth is that policies must promote it,” said the minister.

  • Amazon offers Vietnamese products route to global market

    Amazon offers Vietnamese products route to global market

    Amazon is collaborating with Vietnam’s trade ministry to sell the country’s products on its system globally. Vu Ba Phu, director of the Ministry of Industry and Trade’s Trade Promotion Agency, said while announcing news of the collaboration that the U.S. e-commerce company would help especially small and medium-sized enterprises (SMEs) develop their brands on its website.

    It would also train Vietnamese firms in e-commerce and selling on its system, he said. Vietnamese businesses would be able to reach over 300 million users of the world’s largest online retailer by participating in Amazon Global Selling, he added.

    Bernard Tay, Amazon’s regional director for Southeast Asia, said Vietnam is among the top countries in the region in terms of capability to export via Amazon.

    It has strengths in household products, textile, footwear, and handicrafts, items that sell well on Amazon, he said.

    Vietnamese firms need to make products adopted to global trends and improve their English and branding skills, Tay added.

    Phu said Vietnamese SMEs would have to meet the high standards in many markets.

    “Big markets like the E.U., U.S. and Japan all have strict regulations on product quality and origin, and Vietnamese exports will have to comply with them.”

    Last year Amazon had organized a number of training programs for Vietnamese SMEs on how to sell on its system.

    Chinese e-commerce behemoth Alibaba is also interested in Vietnamese sellers. It started looking for sellers on its AliExpress website last July, saying it wanted to enable them to reach over 200 markets around the world.

    Vietnam’s e-commerce market grew by 25 percent in 2017, according to the Vietnam E-commerce Association (VECOM), which expects this rate to continue until 2020.

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  • Hanoi, HCMC hotel rooms getting expensive

    Hanoi, HCMC hotel rooms getting expensive

    Hotel room rates in Hanoi and HCMC, at around $110 a night, are the second most expensive in Southeast Asia behind only Singapore. Real estate services firm CBRE Vietnam said at a recent conference that the performance of the four- and five-star hotel segments was very strong in 2018 due to limited supply but constantly increasing demand.

    By the end of the year the average rent in this segment reached $112.6 in Hanoi and $114.1 in HCMC. High-end rooms in Hanoi number 7,770, of which two thirds are in the five-star category, and their average occupancy rate last year was 78.4 percent.

    Most of them are concentrated in the downtown area and Ba Dinh, a central district where most government offices and embassies are located.

    CBRE said in recent years sharing economy models like AirBnB have been trending, with AirBnB supply in Hanoi and Ho Chi Minh City topping 24,000 units compared to 17,500 four- to five-star hotel rooms.

    “However, despite the rapid growth of this model, room-sharing has not a clear impact on business in the four-five-star segment.”

    As of 2017 there were 118 five-star hotels/resorts in Vietnam, almost twice the number in 2013.

    They had an occupancy rate of over 75 percent, 5 percentage points up from 2016, according to global consulting firm Grant Thornton.

    Vietnam National Administration of Tourism (VNAT) statistics show an upsurge in the number of foreign visitors to Vietnam in the last few years. Last year 15.5 million came to the country, a 20 percent rise from 2017.

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  • Vietnam’s top five brands increase value by $2.3 billion

    Vietnam’s top five brands increase value by $2.3 billion

    Vietnam’s five most valuable brands were worth a combined $8.1 billion in 2018, up $2.3 billion or 39 percent against 2017, Brand Finance estimated. The most valuable brand was military-owned mobile network Viettel at $2.8 billion last year, up 9 percent from $2.57 billion 2017, said the UK brand valuation company. The 47th most valuable telecom brand in the world has operations in Laos, Cambodia, Haiti, Mozambique and Peru.

    In second place was Vinamilk, the country’s largest dairy company by far, which was worth $1.9 billion, up 39 percent. State-owned Vietnam Posts and Telecommunications Group (VNPT) was in third place after increasing its brand value by 84 percent to $1.34 billion.

    In fourth and fifth places were Vinhomes, the real estate subsidiary of Vietnam’s largest private conglomerate Vingroup, and Sabeco, Vietnam’s biggest brewer, at $1.18 billion and $950 million respectively.

    Samir Dixit, CEO, Asia-Pacific of Brand Finance, said: “Branding is the most critical asset of every business. It is difficult to predict the performance and behavior of customers, but the only thing that remains a constant is the brand.”

    Brand Finance’s valuation criteria uses several metrics. The value accorded to each brand is a summary of its financial strength. Each brand also gets a brand rating, which indicates its strength, risk and future potential relative to its competitors.

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  • Vietnamese ecommerce Leflair receives US$7-million investment

    Vietnamese ecommerce Leflair receives US$7-million investment

    Vietnamese e-commerce firm Leflair has raised US$7 million in a Series B funding round from South Korea’s GS Shop and private equity firm Belt Road Capital Management. This investment is the first by GS Group’s online retail subsidiary GS Shop in a Vietnam startup, and is expected to increase the volume of South Korean products in Leflair’s inventory.

    “We are going to use this capital first to leverage as much as possible the strategic partnership with GS. It means investing in hiring the teams that will make this partnership a success and deploying resources in the areas of fulfillment, delivery, and technology,” says Leflair CEO and co-founder Loic Gautier.

    “This year will be one of regional expansion as we progress towards making the world’s best brands accessible to more consumers in Southeast Asia,” Gautier added.

    Founded in 2015, Leflair focuses on premium-branded products for women, men, kids, and homes. Since its launch, Leflair has raised US$11.8 million investment from angel investors and venture capital firms from the US, France, Italy, Singapore, Hong Kong, South Korea, and Cambodia.

    According to a recent EU-Vietnam Business Network report, Vietnam had about 51 million internet users in 2017. Vietnam’s e-commerce sector is forecast to continue growing at 14 per cent annually this year and next.

  • Vietcombank’s profit skyrockets, Vietinbank’s falls

    Vietcombank’s profit skyrockets, Vietinbank’s falls

    Two of Vietnam’s largest banks reported contrasting performances in 2018, with Vietcombank’s profits rising by 63.5 percent and Vietinbank’s falling by 27 percent. Vietcombank, the largest listed bank by market capitalization, said profit before tax was VND18.02 trillion ($772.73 million) last year, up 63.5 percent over 2017. Vietcombank earlier this month raised VND6.2 trillion ($265.86 million) from selling a 3 percent stake to foreign investors.

    Singapore sovereign fund GIC bought 2.55 percent while Japan’s Mizuho Bank bought the remaining 0.45 percent to keep its 15 percent stake unchanged. Nghiem Xuan Thanh, Vietcombank’s chairman, said at a recent conference his bank had achieved all its target last year.

    Bad debts last year accounted for 0.97 percent of total loans and the bank hopes to keep it below 1 percent this year too. Vietcombank plans to have its total asset value increased by 12 percent, and its capital mobilization up by 13 percent this year.

    Vietinbank, the fourth largest listed bank by market cap, saw profit before tax slip to VND6.7 trillion ($287.3 million) in 2018 from VND9.2 trillion ($394.5 million) in 2017. Asset growth, credit growth and capital mobilization grew by 6-10 percent, lower than targeted.

    The lender’s proposal to increase charter capital has not been approved. Its chairman Le Duc Tho said increasing capital is “vital” since it has remained unchanged for years. The State Bank of Vietnam owns 65 percent of the bank, while foreign ownership has reached the 30 percent cap.

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  • Malaysia won’t lose out to Vietnam: Council

    Malaysia won’t lose out to Vietnam: Council

    Malaysia will not lose its competitiveness to Vietnam even though it does not ratify the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Malay Economic Action Council researcher Mohd Effuan Aswadi Abdul Wahab said there was no significant proof that there would be an increase in investment once a country signed a free trade agreement (FTA).

    “It is said that many companies, especially manufacturing firms will move to Vietnam after the country has ratified the CPTPP as the trade agreement is being seen as opening doors for companies to go to countries which have ratified the FTAs. This is certainly not true,“ he said.

    He said investors would look into various factors, including political stability, better infrastructure, skilled workers and rule of law, before making any investment decision.

    “Investors will certainly look into Malaysia’s economic policies before they make any investment decision.

  • Vietnam digital media giant acquires US network

    Vietnam digital media giant acquires US network

    Media giant Yeah1 Group has acquired ScaleLab, a U.S. Youtube multi-channel network, for $20 million. ScaleLab is expected to receive $12 million upfront and another $8 million later if business targets are achieved two years after the merger. ScaleLab executives have said the company agreed to the sale because it requires an infusion of funds to expand operations and desired to integrate with Yeah1’s media ecosystem.

    ScaleLab plans to expand into Asia, where Yeah1 connects Asian talents and influencers with the international market.

    Tri Dao Phuc, CEO of Yeah1, said the strategy over the next three years is to “acquire premium social media brands, optimize our existing channels to boost viewership and performance.”

    Headquartered in Hollywood, the U.S., ScaleLab is best known as the Youtube partner of Jake Paul, Jimmy Donaldson, Mariale Marrero, Erika Costell, Katie Angel, and many other YouTube stars.

    It has a roster of 1,750 influencers and 400 million subscribers, and gets three billion Youtube views a month.

    The five-year-old company was recognized as the fastest-growing media company in the U.S. by Inc. Magazine last September.

    This is not Yeah1’s first acquisition in the social media field. Last year it had bought two multi-channel network (MCN) companies, SPRINGme of Thailand and Something Big of France.

    Founded in 2006 it is Vietnam’s largest multi-channel media ecosystem, operating TV channels, movie studios, Youtube networks, and digital news.

    It was also the first media company to list when it got into the Ho Chi Minh Stock Exchange (HOSE) last June.

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  • Bamboo Airways to begin flying next week

    Bamboo Airways to begin flying next week

    Bamboo Airways, Vietnam’s newest airline, has begun ticket sales and its first flight is scheduled to take off next Wednesday. The airline has just officially opened ticket sales on Saturday. It has three ticket classes, Economy, Flexible Economy and Business Class, and unlike other low-cost carriers like VietJet and Jetstar Pacific, all passengers will be served hot meals or snacks.

    The carrier has announced a slew of promotions such as combining air tickets with hotel rooms at resorts owned by FLC Group, its parent company, and golfing.

    The airline’s vice president, said the first flights would be to Hanoi, HCMC, Danang and popular tourist destinations such as the central provinces of Quy Nhon, Quang Binh and Thanh Hoa and the northern province of Quang Ninh.

    Bamboo Airways start off with 60 domestic flights a day. Later this year it will fly to Japan, Korea and Singapore.

    Bamboo Airways was founded in mid-2017 with a charter capital of VND700 billion ($30 million), which it increased to VND1.3 trillion ($55.68 million) recently.

    The airline has signed deals to buy 24 Airbus A320neo and 20 Boeing B787-9 Dreamliner aircraft for around $8.6 billion.

    The four other carriers currently in Vietnam are Vietnam Airlines, Vietjet Air, Jetstar Pacific, and VASCO.

  • Grab appeals $208,000 Vinasun compensation ruling

    Grab appeals $208,000 Vinasun compensation ruling

    Grab has appealed a verdict by a Vietnamese court to pay compensation to domestic taxi firm Vinasun for causing it losses. Arguing that the order to pay VND4.8 billion ($208,000) by the first instance court was unlawful, the Singapore-headquartered Grab has asked the appellate court to quash the case. It wants the court to quash the verdict on the ground that the HCMC People’s Court had seriously violated procedures and dismiss the case. The court had no jurisdiction to hear the case, handed a verdict that exceeded the scope of the lawsuit and did not summon the witnesses it had sought, the company said.

    The ride-hailing firm maintained it did not commit any wrong against Vinasun. If the appellate court is not willing to dismiss the case, it should at least amend the earlier ruling, ruling that Grab does not carry on a transportation business and has not violated any laws, and dismissing Vinasun’s claims.

    Grab said the court did not fully and objectively evaluate the facts and evidence of the case, but instead relied on biased information based on an inaccurate assessment of losses done by a court-appointed inspection company.

    “Vinasun could not prove its actual damages and/or the causal link between any of Grab’s alleged violations and Vinasun’s alleged damages,” Grab said in the statement.

    The court verdict came after an 18-month battle between Grab and Vinasun since last June when Vinasun filed a suit saying Grab’s illegal activities had caused it nearly VND42 billion ($1.8 million) in losses.

    The latest draft of a Ministry of Transport decree requires firms offering taxi services to register as taxi firms before they can apply ride-hailing technology.

    This means Grab and other ride-hailing firms have to register afresh as taxi businesses and comply with legal requirements related to operating licenses, drivers’ profiles and taxes.

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  • Samsung in strategically key Vietnam for the long haul

    Samsung in strategically key Vietnam for the long haul

    South Korean conglomerate Samsung is committed to a long-term presence in Vietnam as a major base for its global operations. Won Hwan Shim, vice president of Samsung Electronics, reiterated the group’s commitment to Vietnam in a Friday meeting with Vietnam’s Prime Minister Nguyen Xuan Phuc. Shim said that Samsung’s plants in Vietnam had the most impressive growth among the company’s global facilities.

    Samsung, the world’s biggest smartphone maker, has been investing more and more in Vietnam, especially in its research and development centers, Shim said, adding that the group is transferring technologies to these local facilities.

    The company invested $600 million to finish the Samsung Ho Chi Minh City Research & Development Center in November 2017, its second such facility in the country after Hanoi, he noted.

    PM Phuc said that he expects more impressive growth numbers from Samsung this year, and also asked that Samsung continues to make Vietnam its most important global base, further expanding its operations here.

    Samsung has invested $17.3 billion in eight factories and two research and development centers in Vietnam, creating jobs for more than 160,000 locals.

    It is the largest foreign investor in Vietnam. Last year, Samsung estimated its exports from Vietnam was $60 billion, up 12 percent from 2017, accounting for a quarter of Vietnam’s total exports.

    Samsung last month closed one of two phone factories in China to focus more on low-cost countries like Vietnam and India for production as reported.

    The group’s two phone factories in Vietnam together make 240 million units a year. The factories, located in the northern provinces of Bac Ninh and Thai Nguyen, produce half of all the cellphones that Samsung supplies to the global market.

  • Watsons Vietnam opens first store this month

    Watsons Vietnam opens first store this month

    Hong Kong-headquartered healthcare and beauty retailer Watsons is to launch in Vietnam. The first Watsons Vietnam store will open on January 17, in the lower floors of the high-profile Bitexco tower in downtown Ho Chi Minh City. The store will take up at least one floor of a two-storey space recently vacated by Topshop. Teasing the launch, a huge backdrop with the slogan “Look good, Feel great” has been built outside the space, attracting many Vietnamese youngsters to take selfies and check in on social media.

    On its LinkedIn page, Watsons Vietnam has been recruiting staff for the store and featuring the same artwork as on the Bitexco backdrop.

    Watsons Vietnam will compete with rival Hong Kong healthcare and beauty chain Guardian, owned by Dairy Farm International, which launched in Ho Chi Minh City in 2011 and now claims to have more than 60 stores in four cities.

    Watsons is operated by AS Watson, a subsidiary of retail and telecommunications giant CK Hutchison which is quarter-owned by Singapore sovereign investment fund Temasek Holdings. AS Watson has some 6800 Watsons health and beauty stores in 12 markets in Asia and Europe, including Hong Kong, Mainland China, Taiwan, Macau, Thailand, Singapore, Malaysia, the Philippines and Indonesia. The broader AS Watson group has 14,500 stores, including electrical retailers and grocery stores.

    Watsons has just celebrated the opening of its 500th store in Bangkok, Thailand. The store photo accompanying this story is of Watson’s new-generation store at IconSiam in Bangkok.

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  • Vietnam’s coffee traders cut output forecast by 10 percent

    Vietnam’s coffee traders cut output forecast by 10 percent

    Traders in Vietnam lowered their coffee output forecasts by 10 percent this week as a bumper harvest came to an end. They now expect an output of about 27 million bags of 60 kg each for the 2018/19 crop year that began on Oct. 1, compared with earlier forecasts of 30 million bags. “We are not surprised to see a lower output as stubbornly low domestic prices have discouraged many farmers to fertilize and water their trees, while weather condition was also not supportive,” a trader based in the province of Dak Lak said on Thursday.

    “Farmers in the Central Highlands have harvested all of the fresh beans of the 2018/19 crop year,” he said.

    Farmers in the Central Highlands, the country’s key coffee growing area, sold coffee at 33,500-34,000 dong ($1.44-$1.47) per kg on Thursday, compared with 33,200 dong-33,700 dong a week earlier.

    “Though output is lower, domestic prices have not risen due to external factors, including larger forecasts by foreign agencies,” said another trader based in Ho chi Minh City.

    Vietnam’s coffee exports in January are forecast to be between 150,000 tonnes and 180,000 tonnes, compared with an estimated 160,000 tonnes in December.

    Traders in Vietnam offered 5 percent black and broken grade 2 robusta at a $40 per tonne discount to the March contract, compared with a $45-$50 discount last week.

    Meanwhile, in Indonesia, trading continued to be muted with traders saying premium for the grade 4 defect 80 robusta stayed unchanged for a fourth straight week at $20-$30 to the March contract.

    “Supply may only start coming around April because some areas in Bengkulu will have some harvest then,” said a trader, referring to a province neighbouring Lampung.

    Main robusta harvest in southern Sumatra typically takes place around the mid-year, but a smaller harvest usually happens a few months earlier.

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