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Tag: Vietnam

  • New Vietnam international airport welcomes first passenger flight

    New Vietnam international airport welcomes first passenger flight

    An international airport that will be used for both commercial and military purposes was officially opened to traffic after two years of construction. A Vietnam Airlines Airbus A321 carrying Vietnam’s Prime Minister Nguyen Xuan Phuc and government officials made the first touchdown at the Van Don International Airport near the world-famous Ha Long Bay on Sunday morning, marking the opening of the first private airport in Vietnam.

    Construction of the airport, 50 kilometers away from Ha Long Bay in the northern province of Quang Ninh, began in 2015.

    The 325-hectare (803 acres) airport, owned by real estate giant Sun Group, costs VND7.7 trillion ($330 million) and can handle 2.5 million passengers a year equivalent to 1,250 passengers per hour. Its parking bay will have place for at least four aircraft by 2020 and seven by 2030.

    It is expected to focus on services to Northeast Asian destinations like South Korea, Japan, Taiwan, and mainland China and Southeast Asian ones like Thailand, Malaysia, Singapore, and Cambodia. Domestically, flights will mostly be to and from the southern and central regions.

    The airport now has four gates and the number will be increased to seven by 2030.

    Prime Minister Nguyen Xuan Phuc said at the airport’s opening ceremony that Quang Ninh has much potential to attract more tourists and the new airport would help the province raise the number of tourists from current 15 million to 50 million in the coming time.

    As Van Don District is home to one of the three special economic zones planned in the country, the airport is expected to open up opportunities for socio-economic development in the area, including tourism at Ha Long Bay, said Nguyen Duc Long, Chairman of Quang Ninh Province.

    The private airport is among a series of infrastructure projects aimed at boosting the tourism industry, including a new expressway between Ha Long and the proposed special economic zone in Van Don and the Ha Long International Passenger Port, which were both officially operational from December 30.

    The launch of the Van Don Airport made it easier for foreign tourists to touch down in Ha Long Bay, which was named among the world’s seven new natural wonders by Swiss organization New Open World in 2011.

    The bay was used to film the recent Hollywood blockbuster “Kong: Skull Island”, and has been raved about by many travel bloggers.

    Quang Ninh welcomed 7.5 million travelers in the first half of 2018, including 2.46 million foreigners, up 14 percent from a year ago. Tourism revenues for the period rose 31 percent year-on-year to VND12.8 trillion ($546.7 million), according to official figures.

    Vietnam’s aviation industry has experienced rapid growth in recent years. The country served some 106 million passengers this year, a 12.9 percent increase from last year and highest of all time.

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  • Vietnamese banks deposit rates rise as usual at year end

    Vietnamese banks deposit rates rise as usual at year end

    Banks usually hike deposit interest rates and even offer promotions at the year end, and this year has been no different. On December 19 Sacombank announced a rise in interest rates on deposits of three months from 5.2-5.3 percent to 5.5 percent, and on deposits of 12 months from 6.9 percent to 7.7 percent. VPBank has increased its rates by 0.1-0.7 percentage points, with deposits of 18 months and more carrying the highest rate of 7.8 percent.

    State-owned banks such as BIDV and Vietinbank have hiked rates by 0.1 to 0.5 percentage points.

    The management of a joint-stock bank headquartered in the south said lending usually rises in the last quarter of the year to meet the rising demand for short-term credit to serve the working capital needs of companies.

    As a result, many banks increase their deposit rates, especially for short terms, it said.

    Besides, experts said lenders are running out of time to use 45 percent of short-term capital for medium- and long-term loans, with the ratio to be reduced to 40 percent on January 1.

    The National Financial Supervisory Commission has recently estimated that credit growth to have slowed significantly to 15 percent this year from 18 percent in 2017.

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  • Supermarket retailer Big C opens 147th hypermarket

    Supermarket retailer Big C opens 147th hypermarket

    Supermarket retailer Big C has launched its 147th hypermarket at Nakhon Si Thammarat. Big C Supercenter CEO Aswin Techajareonvikul said Big C’s business has continued to expand this year. “We are recruiting new employees to drive our promising business providing the best shopping experience to our customers. “In Nakhon Si Thammarat, we are offering the new shop-in-shop concept serving the variety of customers. We also focus on home appliance and electronic products responding to trend and consumers’ interests in electronics and IT products.”

    The new centre will employ more than 1000 workers and joins the firm’s network of hypermarkets, 60 markets, 671 Mini Big Cs, and 138 Pure Pharmacies, as well as e-commerce channel Big C Shopping.

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  • VN-Index ends year 10 percent lower

    VN-Index ends year 10 percent lower

    The VN-Index closed the last trading day of 2018 at 892.54 points, down almost 10 percent from the year’s outset. This was a drop of 93 points from January 2, the first trading day of the year. The benchmark closed below the 900-point mark on Friday, a drop of over 25 percent from its peak at over 1,200 points in April. The VN30-Index, representing the 30 largest tocks in terms of capitalization, closed at 854.99 points, dropping 10.46 from Thursday, or 1.21 percent lower.

    Many stocks in the VN30-Index also ended in the red. Diary giant Vinamilk closed at VND120,000 ($5.2), 2.6 percent lower.

    Vietnam’s top petro importer and distributor Petrolimex fell 5.69 percent to VND53,000 ($2.3), while food company Masan dropped 1.9 percent to VND77,500 ($3.36).

    However, the HNX-Index on the Hanoi Stock Exchange and the UPCoM-Index for unlisted public companies ended in the green, up 0.24 percent and 0.46 percent respectively.

    Vietnam’s largest private firm Vingroup (VIC) ended the day at VND95,300 ($4.13), 6.93 percent lower. Vincom Retail’s VRE stock dropped almost five percent to VND27,000 ($1.17).

    Total market capitalization of all three stock markets, the Ho Chi Minh City Stock Exchange (HOSE), HNX and UPCoM, was VND4 trillion ($173.25 million).

    2018 has proved the most turbulent year for VN-Index since the 2008 crisis, ending an increasing run since 2016.

  • Vietnam court orders Grab to pay Vinasun $208,000

    Vietnam court orders Grab to pay Vinasun $208,000

    Grab should pay Vinasun VND4.8 billion ($208,000) for damage it has caused the top taxi firm, a court ruled Friday.

    The People’s Court of Ho Chi Minh City said in its verdict that Grab had committed many mistakes in its operations in Vietnam, tantamount to unfair competition, which damaged Vinasun’s business.

    Before 2016, Grab had registered almost 300 contract cars in Ho Chi Minh City, which increased to 23,000 by the end of last year. This led to a decrease in the number of active Vinasun cars, causing damage worth VND4.8 billion, the court found.

    By June 2017, Vinasun had provided 1.1 million trips to its customers, while Grab had over 2 million. This shows that the number of Grab cars has continuously increased causing many Vinasun cars to stay unused in parking lots, the court said.

    Grab’s entrance into the Vietnamese market has also lowered Vinasun’s market share, a damage of VND81 billion ($3.49 million).

    Although its entrance has negatively affected Vinasun, the taxi firm could not prove that Grab was the only company to cause this damage, the court said.

    For this reason, the court only required Grab to pay Vinasun the sum of VND4.8 billion for unused cars.

    Change Grab’s status

    The court also proposed that Vietnamese authorities start defining Grab as a transport business.

    Grab has said in many documents to Vietnamese authorities that it is only a technology company and not a transport company. It has also said it only provides electronic transactions and free technology for customers via electronic receipts, which has been approved by the Ministry of Transport.

    But the electronic contracts that Grab mentioned did not confirm to definitions under Vietnam’s Law of Electronic Transactions, the court said.

    It noted that Grab’s contracts did not say who the parties to them were and there were no dispute resolution terms.

    “Grab claims to be a company which provides technology and does not conduct a taxi business nor manage the drivers. But in fact, Grab does manage the drivers and charges transport fees,” the verdict said.

    “When customers order a ride, they transfer their money to Grab or pay via the driver a sum from which Grab takes a percentage. Grab also determines the bonus and punishment for drivers,” it added.

    Furthermore, Grab’s business activities do not follow the law, which requires an automobile transportation business to ensure the number of vehicles and service quality, the court said. The law also requires the business to provide employees with labor contracts, traffic safety training and social security.

    Grab does not follow these regulations and does not pay the taxes it should as a transport business, the court said.

    Since 2016, the Inspectorate of the HCMC Department of Transportation has listed 29 violations committed by Grab concerning not having a business registration certificate, list of transport contracts, and taxi signs, the court said.

    Grab has also ignored twice the Ministry of Transport’s documents asking the company to stop its service with contracted vehicles, it said.

    The ride hailing firm has also violated the law in how it gives out promotions and increase and decrease transport fees multiple times a day, the court added.

    Vinasun had filed the suit against Grab in June last year. It said Grab’s illegal activities were responsible for nearly VND42 billion ($1.8 million) of the VND76 billion ($3.25 million) in losses it had suffered in 2016 and the first half of 2017.

    The trial began in February, but was adjourned a month later to allow for more evidence to be gathered. Grab had protested the valuation of Vinasun’s losses.

    Last October, prosecutors asked the court to accept Vinasun’s petition for compensation of nearly VND42 billion, rejecting Grab’s claim it was a tech firm and not a taxi company.

    Grab responded by writing to Prime Minister Nguyen Xuan Phuc, saying that identifying it as a taxi firm would be “a step backward from Industry 4.0.”

    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 that 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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  • Bamboo Airways postpones maiden flight again

    Bamboo Airways postpones maiden flight again

    Vietnam’s newest airline Bamboo Airways will not operate its maiden flight Thursday as scheduled, the second time it has been delayed. Its CEO Dang Tat Thanh said Bamboo Airways could not take off since it is going through “the most difficult examination ever.” “Bamboo Airways is currently going through the final stage of a tight examination by authorities before taking off,” he said, adding that the first flight would now be in mid-January. The airline aimed to launch the first flight on December 29, after failing to launch services in October as previously planned.

    The carrier, owned by conglomerate FLC, received a license last November but is still awaiting an aircraft operator certificate (AOC).

    It was established in May last year with a charter capital of VND700 billion ($30 million), which it increased two months later to VND1.3 trillion ($55.68 million).

    It has signed deals to buy 24 Airbus A320neo and 20 Boeing B787-9 Dreamliner aircraft worth a total of $8.6 billion. Earlier this month it took delivery of the first aircraft, an Airbus A319 leased from an Irish company.

    The airline plans to operate on 100 routes, connecting major cities and travel destinations in Vietnam with the rest of the world.

    FLC chairman Trinh Van Quyet said earlier that the first routes could be between Hanoi and Ho Chi Minh City and from the two cities to Quy Nhon.

    Vietnam has four other carriers still in operation: Vietnam Airlines, Vietjet Air, Jetstar Pacific, and VASCO.

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  • Vietnam GDP growth tops 7 pct, highest in a decade

    Vietnam GDP growth tops 7 pct, highest in a decade

    Vietnam’s GDP growth of 7.08 percent this year retained its status as one of the best performing economies in the world. It was the highest growth the country has experienced since 2008 and compared with the median estimate of 6.9 percent in a survey of 12 economists.

    The scale of the economy at present value is over VND5.53 quadrillion ($237.38 billion), with average GDP per capita at $2,587 per person, a $198 increase over 2017, Nguyen Bich Lam, head of the General Statistics Office, said Thursday afternoon.

    According the office, the agriculture, forestry and fisheries sector grew by 3.76 percent this year, and contributed to 8.7 percent to the country’s GDP. Corresponding figures for industry and construction sectors were 8.85 percent and nearly 49 percent; and that of the service sector, 7.03 percent and approximately 43 percent.

    Lam said that the consumer price index (CPI) in December 2018 fell by 0.25 percent compared to the previous month. On average, CPI in 2018 increased by 3.54 percent, well below the 4 percent target set by the National Assembly.

    Export turnover for the year is estimated at over $244.7 billion, up nearly 14 percent compared to 2017.

    The FDI sector (including crude oil) still accounts for nearly 70 percent of export turnover, at more than $175.5 billion.

    On the other hand, Vietnam imported more than $237.5 billion the whole year, up 11.5 percent over 2017.

    Overall, in 2018 Vietnam achieved a trade surplus of $7.2 billion.

    “The quality of economic growth has improved,” Lam said.

    The GSO director general explained that labor productivity this year saw an increase of nearly 6 percent compared to 2017, at VND102 million (nearly $4,512) per person.

  • Vietnam’s 2018 coffee exports at 1.88 mln tonnes, surges from last year

    Vietnam’s 2018 coffee exports at 1.88 mln tonnes, surges from last year

    Vietnam’s coffee export volumes for 2018 are expected to increase 20.1 percent from last year, while rice exports are estimated to rise 4.6 percent.

    Coffee

    Coffee exports from Vietnam will climb an estimated 20.1 percent this year to 1.88 million tonnes, equal to 31.37 million 60-kg bags, the General Statistics Office said in a report on Thursday.

    Coffee export revenue for Vietnam, the world’s biggest producer of the robusta bean, will edge up 1.2 percent to $3.54 billion in the year, the report said.

    December coffee exports were estimated at 160,000 tonnes, worth $287 million.

    Rice

    Rice exports in 2018 from Vietnam were forecast to rise 4.6 percent from last year to 6.09 million tonnes. Revenue from rice exports in the period was expected to grow 16 percent to $3.05 billion.

    December rice exports from Vietnam, the world’s third-largest shipper of the grain, were estimated at 450,000 tonnes, worth $220 million.

    Energy 

    Vietnam’s 2018 crude oil exports were seen plunging 39.5 percent from last year to an estimated 4.12 million tonnes. Crude oil export revenue in the year is expected to decline 21.2 percent to $2.27 billion.

    Oil product imports in the year were estimated at 11.35 million tonnes, falling 12.1 percent from the same period last year, while the value of product imports rose 7.8 percent to $7.61 billion.

    Vietnam’s 2018 liquefied petroleum gas imports were seen increasing 4.9 percent from last year to 1.43 million tonnes.

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  • How the retail industry has fared in 2018

    How the retail industry has fared in 2018

    The overall retail market in India 2018 stood at Rs 43,251 billion and is forecast to grow by 6.4 percent CAGR in 2018-2023. Retailing in India still predominantly takes place in physical stores and shopping behaviour between urban and rural consumers continues to be vastly different. Smaller independents (both grocery retailers and non-grocery specialists) continued to dominate the landscape they faced growing competition from modern outlets opening in out-of-town shopping centres and malls capturing the Tier II & III markets.

    This year, we witnessed modern retailers launch interesting payments schemes and effective pricing strategies to propel the sales. For example, leading retailer Future Group launched its payment wallet Future Pay which can be used in all its retail brand outlets. Retailers also capitalised on growing acceptance of modern retail by developing new marketing schemes and strategies to attract shoppers.

    Additionally, multi-channel strategies remained key for retailers as they are developed online platforms that are also smartphone and tablet compatible to drive Internet sales.

    Furthermore, retailers also increased their new private labels products. This is was done for certain grocery categories like: packaged foods, non-alcoholic drinks, beauty and personal care and home care products.

    Finally, subscription-based retailing practices started to pick up in 2018. Although still relatively niche, and limited only to urban India, the subscription-based model for beauty and personal care and consumer health became quite popular in metropolitan cities.

    What are the retail trends that are going to rule the roost in retail in 2019?

    – Retailing will continue to offer potential for grocery retailers. Convenience stores and forecourt retailers are likely to continue to see healthy growth rates as their format can meet the demands arising from changing lifestyles by offering more convenient shopping solutions, both in terms of location, business hours and product range.

    – Given the rising maturity of retailing in metros/urban areas, retailers have slowly started to focus on the semi-urban consumer base. This has resulted in the slow and steady urbanisation of shopping styles amongst semi-urban consumers.

    – As the labour crunch and high rentals continue to affect the retail landscape in India, hypermarkets are looking to ramp up investment on self-service technology and automation to reduce costs and improve customer experience. Some hypermarkets chains have implemented self-service kiosks at checkout counters, generally with positive results because of reduced waiting times. Investments have also been made into automated ordering systems, which has helped brands reduce storage space at outlets, hence control rental costs. This can be expected to grow during 2019 as well.

    – Furthermore supermarkets are likely to push the broadening of key product categories, such as organic fresh food, soft drinks and packaged food. They are also likely to further narrow the line between foodservice and grocery retailing, with the introduction and integration of new foodservice elements within their stores.

    – Non-grocery retailing will likely be impacted by the growth of internet retailing at the expense of specific store-based retailers and other non-store channels. Consumers are expected to increasingly shop and research products online, with the popularity of smartphones making mobile-optimised sites and shopping apps crucial in attracting consumers. Moreover, social media will be used more often to alert consumers to attractive price promotions and build interest in new product launches. Also, omni-channel strategies will remain key for non-grocery retailers.

    – Non-grocery retailers will increasingly integrate their online brand information with store inventory, as consumers expect to find the same products in both channels. Moreover, to minimise showrooming, players will also need compelling reasons for customers to buy their brands in store, whether in terms of product selection or price competitiveness.

    – The entry of Amazon and Flipkart could stimulate a much-needed increase in the competition, which will bring both opportunities and threats for existing food and drinks retailers in India. Amazon with ‘Amazon Pantry’ and Flipkart with ‘Flipkart Supermart’ eventually launched its online grocery business in 2018. Millennials and affluent consumers were encouraged to change from shopping in physical stores to online in 2018 with convenience and heavy discounts on offer. Also, with increasing investments from player such as Amazon who are expected to buy skate in Future Retail and PayTm who have partnered with BigBasket and Future Group to strengthen its online grocery business, the food and drinks internet retailing is expected to show tremendous growth in 2019.

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  • Vietnam FDI disbursement in 2018 tops $19 bln

    Vietnam FDI disbursement in 2018 tops $19 bln

    Foreign direct investment disbursement in Vietnam reached a record $19.1 billion in 2018, a year-on-year increase of 9.1 percent. However, FDI pledges for new projects, capital supplements and stake acquisitions were down 1.2 percent from a year earlier to $35.46 billion, according to the Ministry of Planning and Investment.

    A total of 3,046 new projects have been granted investment certificates since the beginning of the year, with a total registered capital of nearly $18 billion. Nearly 1,170 projects registered to increase their capital by a total of $7.5 billion. The rest of the registered capital was reported in a total of 6,500 instances of capital contribution and share purchases by foreign investors.

    This year, foreign investors injected capital into 18 fields and sectors. The processing and manufacturing industry attracted the highest capital at $16.5 billion, followed by real estate with $6.6 billion, and wholesale and retail sectors with $3.6 billion.

    Japan ranked first in FDI contributions to Vietnam this year, followed by South Korea and Singapore. Localities that attracted the most FDI were Hanoi, Ho Chi Minh City and the northern city of Hai Phong.

    Meanwhile, Vietnam invested nearly $380 million abroad this year, mainly in banking and finance, forestry, and fishing. Vietnamese investors injected capital into 38 different countries and territories, with the highest investment in Laos, followed by Australia, the U.S. and Cambodia.

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  • Bullet train to connect Hanoi with HCMC in five hours

    Bullet train to connect Hanoi with HCMC in five hours

    Vietnam’s bullet train will cut travel time between Hanoi and Saigon to five hours from the current 24. The railway project management board has submitted a pre-feasibility study to the Ministry of Transport, which quotes transport consultants’ estimate that if the train travels at 320 km/h, its running time would be from 5 hours 17 minutes to 6 hours 50 minutes depending on the number of stops.

    The route from Hanoi Railway Station to Thu Thiem Station in HCMC’s District 2 will be 1,545 kilometers (960 miles) long and run through 20 provinces.

    Sixty percent of the tracks will be on viaducts, 10 percent underground and 30 percent on the surface, completely protected by fencing and without a single crossing.

    It will have double standard-gauge tracks of 1.435 meters width and 24 stations, according to a consultancy consortium comprising Vietnamese firms TEDI, TRICC and TEDIS.

    It will use the distributed traction technology used by Japanese high-speed trains.

    The project is estimated to cost a total of $58.7 billion, comprising $2.23 billion for land, $43.3 billion for construction and equipment and $4.3 billion for management, consulting and other costs.

    It will be undertaken as a public-private partnership (PPP), with the government accounting for 80 percent of the cost and private investors for the remaining 20 percent.

    Construction will be in two phases, with the 282-km Hanoi-Vinh section and 362-km Nha Trang-HCMC section built first in 2020-2030 at a cost of $24 billion. Commercial operations on these stretches are likely to begin in 2032. The second phase connecting Vinh and Nha Trang is expected to be built in 2030-2045.

    The consultants have estimated the project to cost 0.4 – 0.55 percent of the country’s GDP in 2020-2030 and 0.35 – 0.4 percent in 2030-2040.

    After being reviewed by the Ministry of Transport, the study will be submitted to the State Appraisal Council and the government for review and to the National Assembly for approval next October.

    Vietnam currently has over 3,000 kilometers of railway tracks, none of them high-speed. The railway accounts for just 1.9 percent of the transportation sector in the country, according to the Vietnam Railway Authority.

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  • BMW assembly on the anvil, says Vietnam auto conglomerate

    BMW assembly on the anvil, says Vietnam auto conglomerate

    THACO, a major player in the country’s commercial vehicle segment, plans to assemble German brand BMW cars in Vietnam. Tran Ba Duong, chairman of the Truong Hai Auto Corporation (THACO), said at a conference last week that BMW cars will be the next vehicle that THACO assembles in the country, following other brands like Peugeot, Kia and Mazda.

    He did not reveal further details about when this would happen and what models would be assembled.

    THACO became the sole authorized distributor of BMW in Vietnam starting January this year, after Ho Chi Minh City-based Euro Auto lost its license for smuggling 133 BMW cars in December 2016.

    Duong had said earlier that he plans to open 15 BMW and MINI (a car brand owned by BMW) showrooms by early next year. However, the company currently runs only one BMW showroom in Hanoi, another in HCMC and one MINI showroom, also in HCMC.

    THACO has not revealed its revenue from selling BMW cars this year, but a source told VnExpress that the company sold almost 400 vehicles in the first half of this year. Euro Auto, at its peak, sold 1,400 BMW and 400 MINI cars a year.

    BMW cars were first assembled in Vietnam in 1995 by the VMC company in Hanoi. However, low sales led to the factory’s shutdown in 2005, and VMC had to spend two years selling its inventory.

    Mercedes-Benz is currently the only luxury car brand that assembles its vehicles in Vietnam, and it tops domestic market sales in this segment. Industry insiders say that if BMW cars are assembled in the country again, they could emerge a strong competitor, especially in terms of price.

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  • Value fashion retailer in India launches 200th store

    Value fashion retailer in India launches 200th store

    V-Mart, the world’s best performing department store chain in 2018 as per data compiled by Bloomberg, launched its 200th store in Mughalsarai, Uttar Pradesh. With this landmark achievement, the company has opened a total of 29 new stores in the current fiscal year so far.

    Earlier this month, the company launched its 198 th and 199 th store, both also in UP, at Kannauj and Naubasta near Kanpur, respectively.

    Marking the significance of this milestone for the company, Lalit Agarwal, CMD of V-Mart said, “We remain focused on strong execution, riding on the back of our proven cluster-based expansion model. The 200th store is a key milestone for V-Mart, more so, because we have added the last 100 stores in
    three years, while we took twelve years for the first 100. This demonstrates accelerated customer demand and V-Mart’s ability to translate that into all-round value creation.”

    With the 200th store launch coming just ahead of Christmas and New Year, V-Mart has planned a grand celebration campaign at select locations, starting with Kannauj and Mughalsarai, to bolster the festive spirit among its customers. At both the locations, the company is organizing a ‘Mela’ in large open fairgrounds, inviting the general public to enjoy an eclectic mix of food, fun and entertainment.

    The event in Kannauj, organized with complete support from the local administration, received tens of thousands of attendees enjoying music, folk performances, choreographed shows, fun rides, and delectable street food.

    Snehal Shah, SVP, Projects and Marketing, said, “V-Mart has always endeavored to createlasting value and moments of happiness for its customers. These celebrations are a small way of saying thanks to our customers who have made this milestone possible.”

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  • Vietnam’s four major transport projects on track for completion next year

    Vietnam’s four major transport projects on track for completion next year

    Vietnam is set to complete four infrastructure projects next year, some of them after long delays lasting several years.

    Hanoi’s first metro line 

    The 13-kilometer Cat Linh – Ha Dong metro line is expected to open commercial operations before the Tet Lunar New Year holiday starting February 2, 2019.

    All 13 trains on the route are being trial run every day now, running from Cat Linh Station in downtown Dong Da District to the Yen Nghia Station in the south-west Ha Dong District.The 13-kilometer Cat Linh – Ha Dong metro line is expected to open commercial operations before the Tet Lunar New Year holiday starting February 2, 2019.

    Each train has four coaches, with a total capacity of 1,000 passengers. The stainless steel coaches are approximately 19 meters long. The trains now run at 30-35 kilometers an hour, even though they are designed to reach speeds of 65 kilometers an hour. A complete trip takes about 30 minutes.

    Work on the project is 96 percent complete, officials say, adding that the terminals and depots are “83 percent equipped.”

    Construction of the Cat Linh-Ha Dong elevated railway started in October 2011 and was originally scheduled for completion in 2013. But several hurdles, including loan disbursement issues with China that were only resolved last December, have been stalling the project for years.

    The original cost estimate of $552.86 million has also ballooned to more than $868 million, including $670 million in loans from China.

    Bac Giang – Lang Son expressway

    The expressway connecting Bac Giang Province north-east of Hanoi to the northern Lang Son Province bordering China is expected to be completed next December.

    The four-lane expressway runs 64 kilometers. A 110-kilometer stretch of the existing National Route 1A connecting the two provinces will also be upgraded to be part of the expressway.

    The total project cost has been estimated at VND12.19 trillion ($523.67 million).

    Most of the expressway has been completed. Next year, operators will finish laying asphalt and installing road signs and lights.

    Work on the expressway started in October 2015 and was scheduled for completion last year. However, the  Ministry of Transport had to select a new investor for the project after the original one was found wanting.

    The Bac Giang – Lang Son expressway is part of the Hanoi – Lang Son expressway, connecting the capital with the Huu Nghi International Border Gate in Lang Son Province.

    Cu Mong Tunnels 

    The Cu Mong Pass, lies mostly in Binh Dinh and partly in Phu Yen, is one of the most dangerous passes in Vietnam. The new tunnels are expected to reduce the number of dangerous traffic accidents that the pass has become infamous for. They would also reduce travel time between the two provinces.The Cu Mong tunnels, connecting the southern provinces of Binh Dinh and Phu Yen, are expected to open on January 21, allowing all vehicles to go through free of charge during the February 2-10 Tet holiday.

    The two tunnels are 2.6 kilometers long and 30 meters apart and have a 4-kilometer lead-in road. The tunnels allow a maximum speed of 80 kilometers an hour. For an unspecified first period, only one tunnel will be operated. For now, the second one will be reserved for use in emergencies.

    The tunnels have a total capital of almost VND4 trillion ($171.82 million). Construction started in September 2015.

    Vam Cong Bridge in the Mekong Delta Region

    This is the second bridge over the Hau River after the Can Tho Bridge, which is 48 kilometers away. It is part of the route connecting Can Tho with An Giang Province, built to boost the socio-economic development of the Mekong Delta region.The bridge, which connects the southern province of Dong Thap with Can Tho City, is expected to be operational by next July.

    The bridge was supposed to be completed by November 2017, but authorities found out that a horizonal beam had a crack four centimeters wide and two meters long.

    The Ministry of Transport ordered repairs, and so far 26 out of 38 steps for this process has been completed.

    The bridge’s budget of $270 million was sourced through official development assistance from South Korea and Vietnam’s counterpart funds.

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  • Vietnam labor costs highest among ASEAN comparators

    Vietnam labor costs highest among ASEAN comparators

    Vietnam’s labor cost is the highest among comparator countries in Southeast Asia, a World Bank report says.

    In a report on enhancing enterprise competitiveness and enhancing small and medium-sized enterprise (SME) linkages, it says Vietnam’s labor costs are higher than in comparable Southeast Asian peers.

    It defines labor costs for each firm as the cost of all payments to all workers divided by the number of workers.

    It says wage costs about $2,739 per worker for the median Vietnamese firm, about twice as high as in Laos, Myanmar and Malaysia, and about 30 to 45 percent higher than in Cambodia, Thailand and the Philippines.

    While Vietnam’s labor costs are higher than in the rest of the region, they seem in line with productivity levels and thus do not seem to be a major obstacle to competitiveness, the report says.

    The average manufacturing firm in Vietnam produces about $10,500 worth of value-added per worker per year, higher than in most countries in Southeast Asia. It is around $10,000 in Malaysia, and $5,000 in Cambodia.

    Vietnam’s relatively high value appears to be partly driven by high and growing use of capital, the report says.

    The report also breaks down labor productivity in the country by region. The north-central and central coastal regions of Vietnam have the highest productivity — of almost $16,000 value addition per worker — while the southeast comes in second at $14,000.

    The Red River Delta region has a productivity of only $7,000, and it is even lower in the Mekong River Delta at around $6,000.

    It also said that foreign-owned firms are generally more productive than domestic firms, which can be explained by their easier access to technology and finance through their parent companies.

    The World Bank report also says that capital productivity is low in Vietnam. The ratio of sales to value capital in Vietnam is around 160 percent, lower than in any of its peers in Southeast Asia. The bank’s data confirms that capital might not be used very efficiently in Vietnam.