"Vietnam News" Posted by Samson at KTFA 2-21-2022
KTFA:
DoTalkToMe: Imo Viet Nam has been doing well for decades. Viet Nam deserves to have a higher value in their currency. All boats rise with the tide. Perhaps VND WILL RISE, and surprise. Counting on it to do well. Imo
Samson: Vietnam new Asian tiger: Business Times
15th February, 2022
Việt Nam is expected to accelerate its economic recovery from the pandemic this year after having recorded a 2.6 per cent increase in gross domestic product (GDP) in 2021, Singapore’s Business Times reported.
Once among the poorest countries in the world, its economy is now booming and the World Bank describes it as one of the most dynamic and emerging countries in the entire East Asia region, Business Times said in an article published last week, calling Việt Nam a “new Asian tiger.”
Singapore’s DBS Group Research forecasts Việt Nam’s GDP growth to reach 8 per cent in 2022, boosted by an accommodative monetary policy. The International Monetary Fund (IMF) has predicted that Việt Nam will climb three spots to rank third in GDP among ASEAN member states this year, thanks to the fast-growing middle class and the rise of ultra-rich people.
Knight Frank’s latest Wealth Report estimates there were about 19,500 high-net-worth individuals in Việt Nam in 2020, defined as those with assets of at least US$1 million, the article said. By 2025, that number is expected to grow by almost 25 per cent to top 25,000, it added.
Business Times attributed the robust growth of the economy to increasing flows of foreign investment into the country. Many Singapore companies, including CapitaLand and Keppel, have invested heavily in the country as they seize abundant opportunities.
“Việt Nam has long been known as Southeast Asia’s coding farm, where talent and wages are in a sweet spot for companies to use it as a base for their technical development,” it noted.
The article also referred to Việt Nam as the largest solar power producer in Southeast Asia today with 16.6 gigawatts of installed capacity as of 2020. Việt Nam’s construction industry was set to continue its recovery in 2022 as several large-scale infrastructure projects would move through different stages of development, it further said.
Việt Nam’s economic prospects, challenges in 2022
Another article recently published on the East Asia Forum site also assessed prospects and challenges facing the Vietnamese economy this year. As per the article, 2021 was a tough year as shutdowns made life difficult and GDP slowed to 2.6 per cent. Increasing supplies of vaccines eventually allowed more normal activities in the last few months of the year. Việt Nam’s GDP shrank 6 per cent in the third quarter before bouncing back in the fourth quarter.
According to the author, despite factory closures, exports rose 19 per cent in 2021 to an astonishing $336 billion, while GDP was only $271 billion in 2020 and grew only slightly in 2021. The high level of foreign direct investment (FDI) did not grow nor shrink much.
The article noted that prospects for Việt Nam in 2022 would be good. As factories and services return to normal, there would be a jump in output. Most projections were for 6–7 per cent real GDP growth. Tourism should start to recover from its over 95 per cent decline from 2019 levels. Exports should grow about 15 per cent and the trade balance would remain modestly positive. Inflation would remain low and the Vietnamese đồng would continue to appreciate slightly against the US dollar.
The author also pointed out that one side effect of Việt Nam’s rapid export growth had been a lag in domestic value-added in exports. Much of the work had been simple assembly rather than the development of a dense network of supplier industries that would make the FDI ‘stickier’ as wages rise and labour supplies tighten. The COVID-19 pandemic slowed progress on this front, as fewer new enterprises opened and many more temporarily closed. Many firms that were still in business were financially weaker and would need time to accumulate resources to improve machinery, training and marketing. LINK
************
Samson: Vietnam’s economy to grow at 6.7 per cent in 2022: Standard Chartered
20th February, 2022
Việt Nam’s economy is predicted to bounce back strongly, growing at 6.7 per cent this year and 7.0 per cent in 2023, according to Standard Chartered Bank.
The global economy, meanwhile, has been forecast to grow at a 4.4 per cent rate this year, said Edward Lee, chief economist for ASEAN and South Asia at Standard Chartered Bank, against the 5.8 per cent growth rate in 2021.
High base effects, tighter monetary and fiscal policies, global supply-chain disruptions, and elevated inflation are expected to moderate the recovery momentum, following a strong bounce earlier in 2021 driven by initial vaccine rollouts and government stimuli were contributing factors.
Việt Nam’s economic recovery should kick into high gear by the end of the first quarter of 2022, gaining momentum for the rest of the year as well as for the medium-term growth, said Tim Leelahaphan, economist for Vietnam and Thailand at Standard Chartered Bank.
Leelahaphan said he expected the South East Asian country to remain a key part of the global supply chain as rising wages in China, US-China trade tensions have compelled companies to relocate their production centres out of China or to opt for a China+1 strategy. As this diversification process continues over the medium term, Việt Nam has a strong appeal to become an alternative manufacturing base.
Ben Hung, CEO for Asia at Standard Chartered Bank added: “The future of sustainability and our journey towards net-zero require joint efforts and collective action.
“Việt Nam is an important market in Standard Chartered’s Asia footprint and we are committed to investing in the country to help finance its sustainable development and secure greater economic prosperity. “We will continue to connect Việt Nam with the world and provide sustainable finance to areas where it matters most. And we believe that the Government’s enhanced focus on greening the economy will offer businesses and investors increased confidence to invest more into Việt Nam’s sustainability agenda for the long term.”
Michele Wee, CEO at Standard Chartered Bank Vietnam commented, “The Vietnamese economy is now on a recovery trajectory. In our market research, our clients have told us that Việt Nam holds tremendous potential for growth and investment attraction. “The country is playing an increasingly important role in international trade and the global supply chain. As a leading international bank in Việt Nam, we remain fully committed to supporting the country’s strong, sustainable recovery and growth in 2022 and the years to come.”
The recovery process was discussed at a forum in Hà Nội last week organised by the bank and Ministry of Foreign Affairs as part of the bank’s ongoing efforts to support the country’s sustainable development process.
In November, the bank teamed up with the Ministry of Planning and Investment and the Embassy of Việt Nam in the UK to organise a conference in the UK with the Prime Minister of Việt Nam on securing a prosperous and sustainable future through private investment. As part of this event, the bank exchanged MoU worth US$8.5 billion with three Vietnamese businesses on projects to support their sustainability goals.
Aspiring to become the world’s most sustainable bank, it has set out its ambitious new targets to reach net-zero carbon emissions from its activities by 2050, including interim 2030 targets for the most carbon-intensive sectors. The bank also plans to mobilise $300 billion for green and transition finance by 2030. LINK
Samson: IFC partners with Singapore’s YCH and Vietnamese T&T to develop super port in Việt Nam
18th February, 2022
International Finance Corporation (IFC) announced it will partner with Singapore’s YCH Group and Việt Nam’s T&T Group to develop a “super port” in Việt Nam.
Located roughly 60 kilometres outside of Hà Nội in the northern province of Vĩnh Phúc, the Vĩnh Phúc Inland Container Depot (ICD) Logistics Centre (Vietnam SuperPort) project will be developed by T&Y Superport Vĩnh Phúc JSC, a joint venture between Singapore’s YCH Group and Vietnamese conglomerate T&T Group (sponsors). The project is set to be one of the country’s first ICDs with multi-modal facilities, including an international distribution centre and an inland port for rail connectivity and air transportation.
Over the next 12 months, IFC will help YCH Group and T&T Group develop a bankable and sustainable project by providing technical expertise, helping the developers mitigate risks and strengthen environmental and social standards. IFC will also support the sponsors in making the logistics hub’s infrastructure green and sustainable, supporting Việt Nam in its efforts to reach its net zero carbon emissions target by 2050.
IFC also has the right to act as lead arranger of long-term financing for the Vietnam SuperPort. Total investment capital for the project is expected to be over VNĐ4.5 trillion (US$199 million).
The establishment of such a logistics hub in the North of Việt Nam will significantly improve the processing of domestic and international trade, reducing logistics costs and improving the country’s trade competitiveness as it aims to become a new regional supply-chain hub.
Đỗ Quang Hiển, Chairman of T&T Group, said: “We are confident that Vietnam SuperPort’s multimodal logistics hub built with cutting edge technology will reduce the cost of logistics and improve time to market, thereby improving trade connectivity to the world, boosting our economy as well as contributing to the symbiotic and sustainable growth of Việt Nam.”
“The partnership with IFC ensures bankable financial solutions to keep pace with the development of the ASEAN Smart Logistics Network (ASLN) and SGConnect (Smart Growth Connect). With the unwavering support of the key leaders and colleagues in ASEAN communities, we are confident that the establishment of ASLN and many more innovative initiatives will drive positive economic and social impacts to the overall ASEAN economy so that communities will continue to thrive,” said Dr. Robert Yap, Executive Chairman of YCH Group.
The facility is strategically located near local ports, Nội Bài International Airport, and border posts with China and Lao PDR. It is also situated within reach of 20 industrial parks, enabling it to become a supply chain hub for local manufacturing operations. The port is expected to capture roughly 10 per cent of the total container traffic generated in the country’s northern provinces once it comes into operation. LINK
*************
Samson: FDI to Việt Nam predicted to surge in 2022
18th February, 2022
Việt Nam remains an attractive destination for Foreign Direct Investment (FDI), which is likely to experience a surge in 2022 after a long hiatus due to the pandemic, according to economic experts.
During the first two months of the year, Việt Nam recorded US$2.1 billion in new investment with $1.6 billion disbursed, respectively a 6.8 per cent and a 4.2 per cent increase from the same period last year.
Much-anticipated projects include a sound equipment factory in WHA Industrial Park in Nghệ An Province, which just received over a quarter of a billion dollars in investment to upscale its production and technology. Once completed, the factory is expected to employ up to 30,000 workers, making it one of the largest projects in the province.
Nguyễn Đức Trung, chairman of the provincial People’s Committee said the province’s top priority was to improve the investment environment to win over the confidence of firms and attract more investment in the future. Other projects that received additional investment were GE Việt Nam ($217 million) in Bắc Ninh Province and JNTC (163 million) in Phú Thọ Province, both manufacturers of electronic appliances.
According to the Department of Foreign Investment, 71 FDI projects have applied to increase their investment in recent months, a positive sign for the manufacturing sector as it shows a strong effort to speed up recovery by firms. An increase in the number of new projects and investment in existing projects shows the strong confidence of foreign firms in the country’s investment environment.
Đỗ Nhất Hoàng, head of the department, said the country had been working with foreign partners looking to relocate their production centres. Bringing their investment home is an effective way to support Vietnamese firms in their integration into the global supply chain. Hoàng said foreign investment was likely to pick up in 2022 as countries around the world reopen and learn to adapt to the new normal post-pandemic.
Takeo Nakajima, head representative of the Japan External Trade Organization, said Việt Nam would continue to be one of the most attractive investment destinations for Japanese firms, especially after the visit to Japan by Prime Minister Phạm Minh Chính who oversaw 25 cooperation agreements worth up to $12 billion. “The agreements have set up a strong foundation for Japanese investment to flow into Việt Nam in 2022 and the near future,” said Nakajima.
European firms have been showing stronger confidence in the Southeast Asian economy. EuroCham’s Business Climate Index (BCI) reached its highest point since the fourth wave of the coronavirus, with positive sentiment reaching 61 points, a jump of 42 points since the third quarter of 2021, with business leaders welcoming the end of lockdowns and the re-opening of normal commercial operations.
While the BCI remains below its pre-pandemic peak, confidence is returning to the market with 43 per cent of firms saying they have plans to increase investment within the first quarter of 2022.
“Major businesses from South Korea, Japan, Europe and the US all have plans for new investments in Việt Nam in 2022, especially US businesses,” said Minister of Planning and Investment Nguyễn Chí Dũng. He said to make the most out of foreign investments, the country must conduct a comprehensive review of its available resources, particularly land and energy capacity.
Other priorities include improving human resources, building supporting industries and finding FDI projects that employ modern technology that is sustainable for long-term national development. LINK