TAX NEWS
FEE CUTS ANNOUNCED FOR A RANGE OF INDUSTRIES
The Ministry of Finance has cut about 36 categories of fees across a number of sectors: aviation, construction, and environment, for example. This is in line with moves to stimulate economic growth.
The cuts are from a few cents to a few hundred thousand dollars (under the right circumstances) and mostly center around business establishment and planning. It’s not clear what impact this might have on a macroeconomic scale.
INSURANCE NEWS
INSURANCE MARKET REVENUE HAS DECLINED FOR THE FIRST TIME IN A LONG TIME
Vietnam’s insurance market has seen a decrease in revenue in 2023. Essentially, this is the result of bad press around the methods that have been used to sell insurance products through financial institutions. For example, insisting that customers must buy insurance products (i.e. life insurance) in order to receive loans.
This received national attention earlier this year when Vietnamese actress Ngoc Lan live-streamed herself crying when she realized a life insurance contract she had entered into was not what she expected it to be.
As a result, public sentiment toward insurance has become skeptical and several government probes have been launched. That said, the sector has seen robust growth in recent years and this set back is likely to only be temporary.
F&B NEWS
PHILIPPINES’S FAST FOOD GIANT EYES GREATER SHARE OF VIETNAM MARKET
The Philippines’ Jollibee has announced that it intends to further expand in Vietnam. The fried chicken and rice juggernaut reportedly now has 158 stores in the burgeoning Southeast Asian nation, opening four new stores in the first quarter of this year. The Vietnamese market has proven somewhat fickle for foreign franchises. Whereas many have been successful, many have also struggled.
AQUACULTURE NEWS
BARRAMUNDI FARMING SECURES ADB LOAN TO EXPAND IN VIETNAM
The Asian Development Bank has approved a US$15 million loan to Australis Holdings to increase the size of its ocean-based Barramundi and seaweed farming operations in Vietnam. The key focus of the investment, however, will be sustainability and technology transfers, in line with government objectives to increase productivity in Vietnam’s aquaculture industry.
BANKING NEWS
NORWEGIAN FIRM LIKELY TO ACQUIRE NEARLY 5 PERCENT OF VIETNAMESE BANK
Norwegian Investment Fund is set to buy 95 million shares or a 4.63 percent stake in Vietnam’s SeABank. The sale is estimated to be worth VND 1,200 billion (US$50.7 million) Established in 1994, SeABank currently caps foreign ownership at 5 percent, though legally foreign firms can own up to 30 percent of a Vietnamese bank.
MANUFACTURING NEWS
S&P PMI SHOWS SMALL IMPROVEMENT
The S&P PMI was up from 45.3 in May to 46.2 in June but is still in decline—anything lower than 50 represents a contraction. S&P says that this is on the back of weaker demand in key export markets but that power shortages in northern Vietnam have also been a problem.
INVESTMENT NEWS
APPLE SUPPLIER’S INVESTMENT IN QUANG NINH APPROVED
Key Apple supplier Foxconn has been granted investment certificates for the two projects it has slated for Vietnam’s Quang Ninh province. Foxconn is expected to invest US$246 million developing two factories to manufacture a range of electronic products.
JAPAN FIRM TO BUILD 650 HECTARE INDUSTRIAL PARK IN THANH HOA
Japan’s Sumitomo Corporation has announced that it intends to invest US$400 million in an industrial park project in Thanh Hoa. Around 150 kilometers south of Hanoi, greater development in Thanh Hoa is in line with a rising trend of firms looking for untapped manufacturing potential, outside of the major hubs around Hanoi and Ho Chi Minh City.
CHINESE AUTOMAKER TO OFFICIALLY ENTER VIETNAM MARKET
China’s Great Wall Motors has announced it intends to start selling hybrid electric vehicles in Vietnam this year. Initially, it plans to import ready-made vehicles, often referred to as completely built units (CBU), from Thailand but intends to establish a local assembly plant in the future. Importing CBUs from Thailand has become a common practice in recent years with over 72,000 units imported from Vietnam’s regional neighbor last year.
SOUTH KOREA’S LG INNOTEK IS BUILDING A FACTORY IN HAI PHONG
Another key Apple supplier, LG Innotek intends to invest up to US$1 billion in new manufacturing facilities in Vietnam’s Hai Phong. The province is very popular among foreign manufacturers as it is not only close to the large population center that is Hanoi but also has one of Vietnam’s biggest ports, making it easy to get goods in and out of the country.