Tag: Vietnam

  • Vietnam to navigate rough trade war waters

    Vietnam to navigate rough trade war waters

    Parliament members say the ongoing US-China trade war has had visible impacts, and Vietnam needs to reduce dependence on both nations. At the ongoing National Assembly session, several National Assembly deputies Saturday stressed the need for Vietnam to make policy changes and diversify markets.

    Ha Sy Dong, a deputy from Quang Tri Province, said that the escalating tension between the U.S. and China is not confined to trade.

    It is also a long-term political conflict that has had visible impacts on Vietnam’s economy, he said.

    “The obvious impacts are higher risks in trade, and fluctuating currency and capital flows,” Dong said.

    A report by the National Center for Socio-Economic Information and Forecast (NCIF) released in August said that Vietnam’s GDP could drop 0.03 percent this year, 0.09 percent next year and 0.12 percent in 2020 and 2021 due to impacts of the US-China trade war.

    This equals a GDP drop of VND1.65 trillion ($71 million) this year and VND5.3 trillion ($228 million) next year. The decline will climax at VND8 trillion ($344 million) in 2021.

    The Vietnam Institute for Economic and Policy Research (VEPR) had previously cautioned that the trade war could prompt large corporations to send their capital back to the developed countries as developing countries lose their attraction.

    Technology giants like Foxconn are investing more in manufacturing in the U.S. as a result of the trade war, the VEPR noted.

    “We need to diversify our markets and trade partners to reduce dependence on China and the U.S.,” Dong stressed.

    In the first nine months this year, the U.S. was Vietnam’s largest export market, accounting for 19.5 percent of Vietnam’s total exports, a growth of 13.2 year-on-year, according to Vietnam Customs.

    China was the third largest export market, with the highest growth rate of 29.9 percent. It was also Vietnam’s largest import market, accounting for 27.3 percent of Vietnam’s total imports.

    Tran Tuan Anh, Minister of Industry and Trade, said that as geographical and political tensions between the U.S. and China escalate, the Vietnamese government needs to limit risks for the country.

    He told the National Assembly that he would report in more detail on this issue.

    Taking advantage

    Dong said that Vietnam could also benefit from the tensions, exporting more to the U.S. and welcoming more foreign direct investment as companies leave China.

    U.S. sports apparel company Brooks Running has recently announced that it is considering shifting its manufacturing operations from China to Vietnam to avoid the trade war tariffs of 45 percent.

    Adidas CEO Kasper Rorsted also said in May that his company was shifting footwear sourcing from China to Vietnam, and data from Nike showed that Vietnam produced 46 percent of its footwear last year, against 27 percent in China.

    The U.S.-China trade war escalated last month as the U.S. levied new tariffs of 10 percent on about $200 billion worth of Chinese products, with the tariffs to go up to 25 percent by the end of this year.

    China retaliated immediately with 5 and 10 percent tariffs on $60 billion worth of U.S. products.

  • Vietnam agriculture export shows progress

    Vietnam agriculture export shows progress

    Vietnam’s coffee exports grew 21.5 percent and rice exports 3.4 percent year-on-year in the first ten months, government data showed on Monday.

    Coffee 

    Coffee exports from Vietnam will rise an estimated 21.5 percent between January and October from a year ago to 1.58 million tons, equal to 26.3 million 60-kg bags, the General Statistics Office said in a report on Monday.

    Coffee export revenue for Vietnam, the world’s biggest producer of the robusta bean, rose 1.1 percent to $2.98 billion in the 10-month period, the report said.

    October coffee exports were estimated at 130,000 tons, worth $230 million.

    Rice

    Rice exports in January-October from Vietnam were forecast to rise 3.4 percent from a year ago to 5.24 million tons. Revenue from rice exports in the period was forecast to grow 16.1 percent year-on-year to $2.64 billion.

    October rice exports from Vietnam, the world’s third-largest shipper of the grain, were recorded at 350,000 tons, worth $180 million.

    Energy

    Vietnam’s January-October crude oil exports plunged 45.4 percent year-on-year to an estimated 3.22 million tons.

    Crude oil export revenue in the first 10 months of 2018 fell 24.8 percent to $1.82 billion.

    Oil product imports in the 10-month period were estimated at 10 million tonnes, falling 5.1 percent from the same period last year, while the value of product imports rose 20 percent to $6.77 billion.

    Vietnam’s January-to-October liquefied petroleum gas imports increased 5.7 percent from a year earlier to 1.2 million tons.

  • Rising dollar, market glut cut Vietnam’s shrimp export value

    Rising dollar, market glut cut Vietnam’s shrimp export value

    Vietnam’s shrimp export value plunged almost 15 percent year-on-year in September, hit by the rising dollar and other factors. The Vietnam Association of Seafood Exporters and Producers (VASEP) said shrimp export value dropped by 14.8 percent year-on-year in September.

    Total shrimp export value for the first nine months of the year went down four percent year-on-year to $2.6 billion, the association added.

    The slip in export value began in the second quarter, because of several factors including excessive shrimp supply across the globe and overseas markets taking safeguard action to protect domestic enterprises, the association said.

    Global shrimp supply is expected to rise some 5.5 percent from 2017 to 2018, Undercurrent News, a global seafood news publication, quoted James Anderson, a University of Florida seafood economist, as saying.

    The situation has been worsened by the rising dollar, causing importers to buy less.

    The DXY index of the U.S. dollar versus six developed market currencies is up 4.82 percent this year, now topping the rise of the dollar against emerging market currencies.

    This saw the shrimp export value to the U.S. decrease continuously from April to July this year. In the first nine months of the year, it fell three percent year-on-year to $472.4 million.

    A similar trend can be seen in shrimp exports to the E.U., despite an impressive increase in value in the first six months of the year, the association said.

    VASEP expressed hope that if world prices improve in the coming months, Vietnam’s shrimp export output will increase in the fourth quarter and boost total value for the year to $3.85 billion, last year’s figure.

    However last year’s shrimp export value marked a year-on-year increase of 22 percent.

    Vietnam is world’s third-largest shrimp supplier, according to the agriculture ministry.

  • US sports apparel firm mulls ditching China for Vietnam

    US sports apparel firm mulls ditching China for Vietnam

    U.S. sports apparel company Brooks Running is considering shifting its manufacturing operations from China to Vietnam to avoid trade war tariffs. The firm’s CEO Jim Weber said Monday that the impact of President Donald Trump’s trade war with China is going to put a 45-percent tariff on his company’s running shoes.

    “We’re preparing for a 25 percent tariff on our business and that’s on top of 20 percent already on running shoes. It’s really going to be upsetting for us,” Weber said.

    Vietnam will be a “possible” new supply chain for Brooks, Weber said, adding that the transition will likely cost “millions” of dollars.

    Weber said he was confident that the move will allow his company to be more competitive in the U.S. and in the world as the tariffs are lower in Vietnam.

    He added that the transition, if it happened, would likely to be permanent.

    The U.S.-China trade war escalated last month as the U.S. levied new tariffs of 10 percent on about $200 billion worth of Chinese products, with the tariffs to go up to 25 percent by the end of this year.

    China retaliated immediately with 5 and 10 percent tariffs on $60 billion worth of U.S. products.

    The announcement by Brooks, which sells sports footwear, apparel, bras and accessories in 50 countries worldwide, came after Adidas CEO Kasper Rorsted said in May that his company is shifting footwear sourcing from China to Vietnam.

    Vietnam has in fact overtaken China as Adidas’ top supplier, with Vietnamese factories producing 44 percent of its shoes by volume last year against 19 percent by Chinese manufacturers, according to the company’s data.

    This is also true of Adidas’rival Nike, which had 46 percent of its footwear made in Vietnam last year, against 27 percent in China.

    Vietnam’s footwear exporters seem to be benefiting from the ongoing trade war.

    In the first nine months this year, Vietnam’s footwear exports were worth $11.74 billion, a 10.2 percent year-on-year increase.

    Vietnam is the second biggest exporter of footwear to the U.S. behind China, shipping 404 million pairs of shoes last year.

    Last year, Vietnam’s footwear exports were worth $14.65 billion.

  • SE Asia Stocks not looking good, Singapore hits 22-month low

    SE Asia Stocks not looking good, Singapore hits 22-month low

    Philippines shares regained on Friday after reduction in previous section, while regional markets fell in line with broader Asia. The previous session saw sharp losses in the Philippines and other regional markets, as a tech-fuelled rout on Wall Street spooked investors across Asia, leading to a massive sell-off in regional equities.

    Asian bourses are likely to benefit from “tentative bottom-fishing”, analysts at OCBC said in a note.

    The Philippine index, which has been the region’s worst performer this year and the biggest loser in the previous session, rose 0.7 percent, boosted by real-estate stocks.

     “This is a short-lived bounce, since it was the worst performer and had seen a steep drop yesterday, I think investors think the 6,900 level of the index is a good time to buy… the last time it hit that level, investors bought back,” said Miguel Ong, research analyst at AP Securities.

    Real estate conglomerate Ayala Land Inc gained 2.1 percent and SM Investments Corp added 1.5 percent.

    Indonesian shares also ticked up, helped by telecom and financial stocks. Sector heavyweight PT Telekomunikasi Indonesia Tbk rose 0.8 percent and PT Bank Central Asia Tbk rose 0.9 percent.

    Vietnamese stocks were on track for a seventh losing session and a fourth straight week of losses, with real estate stocks and industrials being the biggest drags on the benchmark.

    Vinhomes Joint Stock Company fell 3.7 percent and No Va Land Investment Group Corporation lost 3.1 percent.

    Singapore stocks approached their lowest in nearly 22 months, falling 1.7 percent and on track for a fourth week in the red. Financial heavyweights like United Overseas Bank Ltd lost 3.5 percent and DBS Bank’s parent company DBS Group Holdings Ltd lost 2.6 percent.

    Thai shares failed to sustain the previous session’s brief bounce and looked set to post a fourth week of losses. Its energy sector, which drove a turnaround in the index in the previous session, was the biggest drag.

    Oil and gas giant PTT PCL lost 2 percent, while PTT Exploration and Production PCL traded 2.2 percent lower.

    Malaysian stocks edged lower on the back of telecom stocks, with Telekom Malaysia Berhad shedding 1.3 percent and wireless service provider Digi.Com Berhad losing 1.7 percent.

  • Grab: becoming a taxi company a step back from Industry 4.0

    Grab: becoming a taxi company a step back from Industry 4.0

    Ride-hailing firm Grab says giving in to traditional taxi companies’ demands is akin to bowing before “angry workers threatening to smash machinery.” Grab has written to Prime Minister Nguyen Xuan Phuc expressing concern over the latest draft of a decree prepared by the Ministry of Transport under which transport firms offering services with under 9-seater cars should be registered as taxi firms before they can apply ride-hailing technologies.

    This means that Grab and other ride-hailing firms would have to register their services again as taxi businesses and comply with corresponding legal responsibilities regarding their operating licenses, drivers’ profiles and tax duties.

    “The regulation not only goes against the policy and guidelines of the Government on the application of science and technology, and on reform of administrative procedures, but also completely denies the clear benefits achieved by the pilot scheme for ride-hailing services,” the company said.

    It said that the pilot scheme has sped up development of the transportation market, helped state agencies find effective management solutions using technology, and inspired the advance of Industry 4.0 in Vietnam.

    The company is providing an essential service to 20 percent of Vietnam’s population every day, providing work for 175,000 drivers and has contributed VND270 billion ($11.5 million) to the state exchequer in taxes in the first 9 months of this year.

    It said many taxi companies have “awakened” to the revolution and are currently cooperating very well with it, as well as other ride-haling firms.

    However, there remain “traditional taxi businesses who fear innovation, losing market dominance, and competition,” the company said.

    Bad precedent

    Grab said that this (treating ride-hailing firms as taxi firms) would set a bad precedent for the whole legal system and send discouraging signals to the start-up environment in Vietnam.

    “We have to emphasize that the approval of this draft, to appease the subjective will of some traditional taxi companies, would be to oppose the benefits and advances so important to society and the economy. This will be a step backwards from Industry 4.0, to bow before ‘angry workers threatening to smash machinery,” wrote Lim Yen Hock, CEO of Grab Co. Ltd.

    On Wednesday, a standing working group of the Government announced the results of the review of the draft submitted by the Ministry of Transport, saying that based on road traffic law, transport vehicles using ride-hailing technology like Grab or Uber are in essence taxis.

    These vehicles have to be subject to regulations as taxis, and cannot be classified as ‘electronic contract-based vehicles’ to circumvent the law, evade tax, avoid costs and receive incentives that do not apply to traditional taxis, the working group said.

    The debate over Grab’s status as transportation company is not new in Vietnam.

    Vietnam’s top taxi company Vinasun has sued Grab for $1.84 million in losses, citing “unhealthy competition.”

    The ride-hailing market in Vietnam has seen new entrants after the departure of Uber, which sold its Southeast Asia operations to Grab. The newcomers include Fastgo and GoViet, the last mentioned being an affiliate of Indonesia’s Gojek.

    Current market dominator Grab has expanded its services to include GrabFood, a food delivery service, and GrabCar Business, targeting the corporate sector.

    These moves pose further challenges for long-standing taxi firms like Mai Linh, Taxi Group and Vinasun.

  • Vietnam’s VinFast in deal with PV Oil for electric car charging stations

    Vietnam’s VinFast in deal with PV Oil for electric car charging stations

    VinFast on Thursday signed a memorandum of understanding with PetroVietnam Oil Corp. to build charging stations for its electric cars and scooters.

    The company, a unit of Vietnam’s largest conglomerate Vingroup JSC, is building a $3.5-billion scooter and automobile complex in northern Vietnam, with its first production electric scooters slated to hit the streets late this year.

    Thursday’s agreement will pave the way for VinFast to deploy charging stations at 20,000 of PV Oil’s existing service stations in Vietnam by 2020, VinGroup said in a statement.

    This is part of VinFast’s plan to launch between 30,000 and 50,000 charging stations nationwide by 2020, it said.

    VinFast customers will be able to charge their vehicles or change their batteries at these stations, it added.

    VinFast Chief Executive Officer Jim Deluca said in an interview earlier this month that the firm would produce 250,000 electric scooters a year alongside 250,000 cars, in an ambitious production target that is set to eventually increase to 1 million units each a year.

    The company has started on the development of a battery electric vehicle with Germany’s EDAG Engineering.

    Vingroup, which has a market value of about $13.2 billion, also has businesses in property, hospitality, entertainment, retail, healthcare, education, agriculture and smart phone production.

  • SE Asia Stocks: Most lose ground, Vietnam dives to three-month low

    SE Asia Stocks: Most lose ground, Vietnam dives to three-month low

    Most Southeast Asian stock markets slumped on Thursday, following a tech rout on Wall Street that saw the year’s gains being wiped out. Disappointing forecasts from chipmakers beat down the tech sector, sending investors scurrying to the safety of sovereign bonds, pushing Wall Street to its worst single-day fall since 2011.

    A concoction of other negative factors like Saudi Arabia’s diplomatic tensions, fears of slowing global growth and the Brexit stalemate spooked investors, with MSCI’s broadest index of Asia-Pacific shares outside Japan dropping about 2 percent.

    Vietnamese stocks dived as much as 4 percent to an over three-month low and were on track for a sixth straight day in the red.

    Financial and real-estate stocks bore the brunt of the beating, with lender Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) losing 2.7 percent and conglomerate Vingroup JSC shedding 2.3 percent.

    Philippine shares fell 2.3 percent, dragged by banking and industrial stocks, pushing the index’s loss this week to 2.6 percent.

    “About 45 minutes into trading, net foreign selling has already reached over 100 million pesos. After last night’s bloody session on Wall Street, as expected foreigners are stepping up selling of Philippine shares, while local investors are staying on the sidelines,” said Fio Dejesus, a research analyst at RCBC Securities.

    Banking giant BDO Unibank Inc shed 3.6 percent and industrial conglomerate SM Investments Corp fell 2.7 percent.

    “It’s a flight to safety, they’re entering into lower risk assets like govt treasuries because the risk-off sentiment has hit emerging markets really hard,” he added.

    Singapore stocks saw the same dismal sentiment, giving up the previous day’s short-lived gains to take weekly losses to over 2 percent.

    Casino and gaming operator Genting Singapore Ltd fell 3.3 percent and investor Yangzijiang Shipbuilding (Holdings) Ltd lost 1.7 percent.

    Malaysian shares followed the same trajectory, shedding 0.8 percent, on track to post their sixth straight session of losses.

    Plantation and industrial heavyweight Sime Darby Berhad lost 5.9 percent and oil and gas services provider Dialog Group Berhad fell 3.9 percent.

    After the previous session’s sharp losses on energy stocks, the Thai index extended losses and were poised for a six-day run of losses.

    All sectors traded in the red, with oil and gas refiner PTT PCL losing 1 percent and lender Siam Commercial Bank PCL lost 2.2 percent.

    Indonesian shares appeared to escape the worst, trading slightly higher as gains in financial stocks offset losses in other sectors.

    Lender PT Bank Central Asia Tbk gained 0.8 percent while sector heavyweight and auto truck manufacturer PT Astra International Tbk lost 0.3 percent.

  • Vietnam’s Ha Long casino continues to lose staff on poor business performance

    Vietnam’s Ha Long casino continues to lose staff on poor business performance

    Ha Long’s only casino continues to lose employees due to a number of reasons, including its persistent losses. Hoang Gia Joint Stock Corporation (RIC) in Ha Long, Vietnam’s resort city, which runs the Casino Gaming Club, said the number of employees has fallen by 275 now compared to the beginning of the year.

    It has less than 1,200 employees remaining. Last year 514 had quit.

    The main reasons, the company admitted, are the casino’s poor business and competitors’ talent attraction policies.

    Revenues increased by 23 percent in the first nine months of this year to VND187 billion ($8 million), but it lost VND14 billion ($597,555).

    Another problem for the casino is the sluggish progress of transport infrastructure works in the region, such as Van Don airport and the Ha Noi – Ha Long Highway, which prevents more foreign tourists, mainly from China, Japan and South Korea, from coming here.

    The company targets revenue and profit after tax this year of $15.9 million and $1.5 million. Casino operations are expected to account for around 63 percent of the revenue with the rest generated by hotels and villas the company owns.

    The owner of the company is Khai Tiep International Investment Limited, registered in the Cayman Islands.

  • New product helps Vietnam’s canned coffee market

    New product helps Vietnam’s canned coffee market

    One of the largest beverage makers in the world is hoping to ‘capture’ Vietnamese taste with its new canned coffee product. Coca-Cola, one of the two biggest players in the Vietnamese carbonated beverages market, has entered the canned coffee market with Georgia Coffee Max.

    Though Vietnam is the second largest exporter of coffee in the world, its ready-to-drink coffee market has not attracted much attention from major players.

    Coca-Cola’s move could breathe life into it, but the challenge is not a small one, industry insiders said.

    For instance, at a supermarket on Quan Hoa Street in Hanoi’s Cau Giay District, canned coffee products do not have their own section, but are placed among other carbonated and energy drinks.

    Four brands of this rarely-seen product — Birdy, Nescafe, Highlands Coffee, and My Café — sit inconspicuously among dozens of other beverages.

    According to the shop assistants, canned coffee is hardly purchased, and sometimes is not bought for weeks at a time.

    The market for canned coffee came to existence 10 years ago with the entry of Birdy Coffee from Japan’s Ajinomoto.

    A year later Nestlé, which wanted a piece of the action, established a canned coffee production line at its plant in the southern Dong Nai Province.

    Other early birds included local dairy giant Vinamilk, which started putting up ready-to-drink coffee production facilities, followed by two then-emerging brands, Tan Hiep Phat and Highlands.

    Though initially many of the brands ran aggressive marketing campaigns, the market gradually fizzled out. Many products disappeared completely within a short time.

    In 2013 local coffee giant Trung Nguyen launched a range of fresh coffee products in bottles and cartons in sizes ranging from 500 ml to a liter. Within two years these too disappeared from grocery store and supermarket shelves.

    Today only a few names are left in the market, like PepsiCo, Highlands Coffee, Nestlé, Ajinomoto, and the new entrant, Coca-Cola.

    The real challenge for producers is no longer getting market share but changing consumer habits.

    Industry insiders quoted customer feedback as saying canned coffee is like fast food, sweet and lacking the authentic coffee taste.

    Speaking at the launch of the new product, a Coca-cola executive said though there are other brands in the market, their research showed the pie is large enough for new players to enter.

    Le Trung Tin, director of the Georgia Coffee Max line, said the secret to success is capturing the Vietnamese taste in the canned coffee.

  • Exchange rates, tax worry Vietnam’s most profitable firms

    Exchange rates, tax worry Vietnam’s most profitable firms

    Exchange rate fluctuations and high taxes are the main concerns of Vietnam’s most profitable businesses, a recent report has found. The survey of the 500 most profitable companies this year, which include 41 foreign invested ones, by consultancy and market research firm Vietnam Report, said 51.4 percent of businesses considered exchange rate volatility as the biggest challenge this year.

    For 42.9 percent of respondents the tax burden was the biggest concern.

    Other factors that affect their profitability are red tape (37.1 percent), global economic instability (31.4 percent) and environmental disasters (25.7 percent).

    However, 90 percent expected their revenues to rise this year.

    Eighty percent said their profit had already exceeded last year’s, with another 8.6 percent saying it had drawn level.

    Almost all (97.1 percent) said the government has stewarded the economy well by curbing inflation and managing the exchange rate adroitly.

    But they wanted improvements to administrative procedures, infrastructure and access to land.

    The survey found the telecommunications-information technology sector having the highest return on equity, 30 percent, followed by transportation with 24 percent and pharmaceuticals with 21 percent.

    The Vietnam Oil and Gas Group or PetroVietnam is the most profitable company this year followed by telecomunications firm Viettel and Samsung Electronics Vietnam Co. Ltd.

  • For Vietnamese exporters, ASEAN market remains bridge too far

    For Vietnamese exporters, ASEAN market remains bridge too far

    Vietnamese companies are struggling to sell their products to ASEAN member countries despite the abolition of tariffs within the bloc. Analysts blame this on their lack of market information and poor understanding of consumer needs among other factors.

    With the formation of the ASEAN Economic Community (AEC) three years ago, members had to reduce over 90 percent of their tariff lines to zero percent, though Vietnam, Laos, Cambodia, and Myanmar were allowed until 2018 to do so.

    Yet Vietnam’s intra-ASEAN exports accounted for only 11 percent last year while this number for other members averaged 24 percent even in 2016, Nguyen Thi Tue Anh, deputy head of the Central Institute of Economic Management (CIEM), said at a recent conference.

    Anh said besides Vietnamese enterprises’ lack of market information, they have also failed to adequately differentiate their products from those of competitors within the bloc.

    A spokesperson for a business based in southern Soc Trang Province said his company, which produces dried fish and other fisheries products, wants to take its products to the ASEAN market but does not know how.

    He said that there are many factors such as package design, marketing and market research, and it does not know where to begin since all are equally important.

    Ha Xuan Anh, chairman of HCMC-based textile maker Son Viet, said his company’s products – undergarments – are sold at many modern retail outlets. But for the last 10 years it has sought to sell to Singapore, Thailand and Malaysia, and has been unable to do so.

    He explained that though the quality of his company’s products is competitive, Vietnamese brands remain unknown in these markets.

    It only sells in markets with less competitive products such as Laos, Cambodia and Myanmar.

    Pham Thiet Hoa, director of the HCMC Investment and Trade Promotion Centre (ITPC), also blamed the weaknesses of Vietnamese enterprises for their inability to export, listing lack of product diversification, failure to closely liaise with authorities responsible for foreign affairs, and poor marketing.

    ITPC said small companies entering a new market alone would find it very difficult to identify foreign business partners and distribution chains.

    Hoa said it is therefore necessary for trade envoys to work with their counterparts in foreign markets to bridge this gap.

    Participating in fairs, exhibitions and trade promotion programmes in target markets enables companies to assess the competitiveness of local rivals, he said.

    Despite the free trade environment, each country in the bloc has differences in culture, religion and consumer preferences, and businesses need to understand them before venturing into those countries, he said. “Enterprises should also carefully study the technical barriers and legal regulations to avoid losses.”

  • Vietnamese entrepreneur makes glasses with wooden frames

    Vietnamese entrepreneur makes glasses with wooden frames

    Long, 23, was frustrated that he was not able to get a pair of glasses that were comfortable, of good quality, long lasting and somewhat unique. These are qualities people generally want in personal wear, especially one that adorns their face for most of the day, but Long was finding that such expectations were not easy to meet.

    No readymade glass in the market fit him.

    Then, as luck would have it, Long happened to meet Tran Hien, a man with an unusual business and passion.

    Hien, whose business is called Shigeru Eyewear, makes spectacles with wooden frames, something that people might assume has gone completely out of fashion.

    Very soon after the meeting, the young customer happily accepted to pay VND1 million ($43) and wait 7-10 days for a pair of custom-made glasses.

    Long, like many other customers who go to Hien, wanted to get involved in the design process and was prepared to wait for the desired outcome.

    Every detail on the frame is carefully custom-made by Hien. On average, the process takes him around 4 hours.

    “Most of my products are handmade. Sometimes, I’m a bit shy shaking hands with people because of my calluses,” said Hien.

    The Japanese connection

    In 2012, Tran Hien graduated with a Graphic Design degree from the HCMC-based Van Lang University, specializing in branding. Through a friend’s introduction, he started working as a designer for a Japanese glasses maker called Shigeru.

    Hien was the first man in Vietnam to get this job, Shigeru told him.

    At first, Hien refused to accept a job where he had to actually make things himself. But Shigeru told him: “If you don’t try your hand at the job, you won’t be able to design something others can make.”

    After working at the production house under the guidance of the Japanese teacher and mentor, Hien not only gained more knowledge about glass-making, but also learned a lot more about an ideal attitude to life.

    “One time after lunch, the staff scraped off the burnt rice at the bottom of the cooker and threw it away. Shigeru saw it and told us, next time, don’t waste food like that, just break the pieces and share them with everyone,” Hien recalled.

    Shigeru’s company made glass frames, mostly in plastic, but also wood and bamboo sometimes, for export to Japan. He also wanted to open a store in Vietnam. But fate had other plans.

    Hien had been with Shigeru – someone who was more of a teacher than a boss – for around one year when tragedy struck. The production house got burned down, Shigeru went bankrupt and had to return to Japan.

    After his mentor left, Hien moved to Hanoi to find new opportunities.

    With zero business experience, he accepted a desk job with a real estate company in Hanoi. After several months of working as a graphic designer in the marketing department, he gained new insights into sales and marketing – something that not many designers care about.

    However, the sophisticated, carefully crafted glasses that Shigeru’s company used to make had left a deep impression on Hien, so after a while, he started to tinker with making glasses again.

    This time, his ambition was to create unique, wooden frames. It would be his niche product.

    Hien liked wood, its texture, colours and the natural patterns it carried. And even better, the longer it was used, the shinier it would get, something that cannot be said of other materials. His main focus was to create something unique, Hien said.

    It was very difficult to get this project off the ground, though.

    “I tried everywhere but no one wanted to cut wood as thin as I wanted, because it requires a lot of effort with little pay,” Hien said.

    After many attempts, one person who shared Hien’s determination to create made-in-Vietnam glasses (instead of Chinese ones dominating the market) accepted to work with him.

    It was still not easy. Many of his first customers had to wait for a long time because Hien was occupied with office work. On top of that, some of the products were not durable. Once, he was very embarrassed when a newly delivered pair of glasses broke as soon as the customer tried it on.

    Some people advised him that brand name, Shigeru, was difficult to market since it was not easy enough to read and remember. However, Hien wanted to commemorate the spirit of his teacher, who’d gladly consented to the student using his name.

    For the whole of 2017, when Shigeru Eyewear was founded, just 20 pairs of glasses were sold.

    The big plunge

    This year, Hien decided to quit his office job, which paid him VND15 million ($640) per month, and devote all his time and effort for his company.

    He studied days and nights, trying to find a way to increase the durability of his wooden frames, but that knowledge was nowhere to be found in Vietnam. Despite being “scientifically illiterate,” after months of perseverance, he finally discovered secrets to creating products that could survive even after  being thrown against the wall or dropped from up high.

    Hien’s current schedule involves meeting up with his clients to get their measurements and discuss their wants. After that, he works on the design, the production process, as well as building company’s image and increasing brand recognition.

    Each pair of glasses is customized to fit its owner

    His company sells dozens of customized pairs of glasses per month now.

    “Sometimes, design inspirations come from the customers themselves. For example, there was one customer who sells traditional clothes and wanted the glasses’ arms to be modeled like a tree branch, I found the idea very interesting and asked to keep the concept as a model for my catalog,” Hien said.

    So far he has been taking wood pieces from furniture companies, aiming particularly at ebony, Siamese rosewood, and Asian rosewood.

    But he’s very keen on being eco-friendly. He said that he was looking for an NGO or other organisations involved in reforestation that he can contribute to. He said that for every glass frame that he sells, he will use part of the proceeds to help reforestation efforts. He is also considering buying seeds and planting trees on his own, Hien said.

    Hien believes the ” For each tree you’ve taken, you have to give back as much to the forest.”

    Expansion plans

    Hien said that he is also looking for someone who can share his passion and can work on the business side of the company.

    Apart from keeping the core as an artistic line, Shigeru Eyewear aims to produce standard glasses that are of high-quality and made with local materials – something that is still missing in the Vietnamese market.

    He is also looking to start making and selling frames with other materials like palm wood and bamboo.

    Currently, glass frames made from wood are still something very new to customers, so he wants more people to have rare pairs of glasses with “Made in Vietnam” etched on them.

    Furthermore, like his beloved Japanese teacher, he hopes to find more people with whom he can share the knowledge he’s accumulated through the years.

    For now, from a time when the company only had a few hundred thousand dong (a dozen of US dollars) to buy materials, and all of the earnings were invested in buying better quality wood and tools, Hien can confidently say he can make a living with the brand.

    “I will spend the rest of my life for my “Made in Vietnam” glasses.”

  • Vietnam footwear industry to be benefited from trade war

    Vietnam footwear industry to be benefited from trade war

    Vietnamese footwear exporters seem to be benefiting from the ongoing trade war between the U.S. and China. According to customs statistics, Vietnam’s footwear exports in the first nine months of this year were worth $11.74 billion, a 10.2 percent year-on-year increase. Its exports to China in the period have risen by 28.5 percent, to Japan by 14.7 percent, and to the U.S. by 13.5 percent.

    Vietnam is the second biggest exporter of footwear to the U.S. behind China, shipping 404 million pairs of shoes last year.

    The upward trend is likely to continue, too, as rising wages in China increase the cost of goods produced there and the country is thus directing more of its manufacturing resources toward higher-priced goods like electronics, according to the global footwear news outlet Footwearnews.

    Foreign companies are moving to other countries like Vietnam to cut cost.

    Adidas CEO Kasper Rorsted said last May that his company is shifting sourcing of footwear from China to Vietnam.

    Vietnam has in fact overtaken China as its top supplier, with Vietnamese factories producing 44 percent of its shoes by volume last year and Chinese manufacturers supplying 19 percent, according to Adidas.

    This would help shield the company from potential tariffs or supply chain disruptions if President Donald Trump’s trade war with China continues to escalate, a fact its competitors also seem to be taking notice of.

    Vietnam may see export orders surging as footwear importers shun China to avoid high U.S. tariffs and choose the Southeast Asian nation instead, local media quoted Diep Thanh Kiet, vice chairman of the Vietnam Leather, Footwear and Handbag Association (Lefaso), as saying.

    “Vietnam’s leather and footwear export can reach $19.5 billion or slightly higher this year depending on the situation,” he said. Vietnam’s footwear exports were worth $14.65 billion last year.

  • Vietnam to cut dependancy on crude oil

    Vietnam to cut dependancy on crude oil

    A prime ministerial advisory body has said the state budget is overly dependent on crude oil, an unsustainable income source. The National Financial Supervisory Commission (NFSC) recently said crude oil is not a sustainable income source, both in the short and long term.

    In the short term, crude oil revenue can be affected by global oil prices and mining output; and the state budget has been significantly impacted by such fluctuations over the years, the NFSC noted.

    In the long run, this source of income is also unsustainable as national reserves are limited, it added.

    Earlier, Deputy Prime Minister Vuong Dinh Hue had said at a meeting of the legislative National Assembly that Vietnam needs to stop relying on crude oil and focus on tourism to ensure its economic growth.

    “It is better to welcome one million tourists than trying to find one million tons of crude oil because tourism is more eco-friendly and safe for the economy,” he’d said.

    Vietnam’s September crude oil exports totaled 375,000 tons, down 21.1 percent year-on-year, according to the General Statistics Office. This brought crude oil exports in the first nine months of this year to 2.97 million tons, down 45.2 percent from a year earlier.

    From early this year to September 15, accumulated budget revenue is estimated to be at VND898.3 trillion ($39.06 billion), of which VND43.5 trillion ($1.89 billion) or about 5 percent comes from crude oil, according to the General Statistics Office.

    Vietnam’s domestic crude oil production reached its peak in 2004 with an output of more than 20 million tons, but has declined to an estimated 14.2 million tons in 2017.

    It is forecast that around 11 million tons will be produced in 2018. Crude oil exports have contributed 0.25 percent to the country’s GDP in recent years.