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.

Before concluding his six-day China visit, New Zealand Prime Minster Chris Hipkins on Friday attended a New Zealand-themed partnership and product launch event in Shanghai, witnessing a series of MOU signing and new products and services from New Zealand entering the Chinese market. The prime minister said his government is committed to supporting New Zealand enterprises in business dealings in China.

Shanghai is the third leg of Hipkins’ China trip which started on June 25, following Beijing and Tianjin. In Beijing, he met with Chinese President Xi Jinping on June 27. China and New Zealand agreed to keep expanding cooperation in economy and trade, education, technology, tourism as well as people-to-people and cultural exchanges, according to a release after the meeting.

Hipkins started his speech at the Friday Shanghai launch event by acknowledging the challenges the businesses faced over the COVID period. “Some of these impacts are ongoing, but we are also seeing the chance to reconnect, reopen and look forward to the opportunities that come with that. Against the odds, bilateral trade between New Zealand and China has continued to grow during a very challenging time. This is testament to the strength of partnerships and connections between Chinese and New Zealand businesses.”

Cambodia issued a sub-decree for the complete implementation of Cambodia’s new Law on Investment – which has been in force since October 15, 2021 – to attract and boost both local and foreign direct investment in the country, said a statement released by the government.

The sub-decree would entitle relevant government institutions, private sector investors and business people to follow and implement the new investment law more effectively as the legal frameworks provide clear-cut guidelines for investment and set clear in-charge bodies, investment projects and incentive conditions.

Cambodia’s Secretary General of CDC—Cambodia’s highest decision-making body for private and public investments stated that the sub-decree sets the clusters of investment projects incentivized on inputs for production to supply domestic markets, a cluster of investment projects incentivized on customs, special duties and Value Added Tax (VAT) but un-incentivised on taxation.

Minister of Commerce Pan Sorasak urged all relevant parties to work together on the possibility of establishing a free trade agreement between Cambodia and Japan following a remarkable surge in exports of Cambodian products to Japan this year.

The minister was speaking at a seminar, attended by businessmen and entrepreneurs from both countries, on trade facilitation and digitization of trade between Japan and Cambodia on Friday.

On 27 May, Australian Trade Minister Don Farrell joined Ministers from the 13 other Indo-Pacific Economic Framework (IPEF) countries in Detroit, Michigan, to welcome the substantial conclusion of a first-of-its-kind agreement to better address modern supply chain challenges.

The new IPEF Supply Chains Agreement will establish a world-first Crisis Response Network to facilitate faster collective responses to critical shortages and supply chain disruptions. This will help ensure Australia’s access to critical goods and reduce market instability. It will also support our businesses and consumers to adapt and be resilient during a crisis.

In addition, an IPEF Supply Chains Council will start work on action plans to address vulnerabilities and chokepoints. This will provide a lasting platform to mobilise investment and boost value-adding opportunities for Australian industry in areas such as critical minerals and clean energy technologies, strengthening our economic resilience.

Through the IPEF Supply Chains Agreement, IPEF countries will develop a shared understanding of global supply chain risks and undertake evidence-based and data-driven identification of critical sectors and key goods. As part of this work, Australia – led by the Minister for Industry and Science, the Hon Ed Husic MP, and the Office of Supply Chain Resilience – and the Republic of Korea will establish a joint initiative to boost the capacity of other IPEF partners to identify, monitor and manage critical supply chain vulnerabilities. An upcoming IPEF Supply Chain Monitoring Symposium will be a natural next step to advance this work.

Airbus, the European aircraft manufacturer, on Wednesday set up an aircraft lifecycle service center in the southwestern Chinese city of Chengdu.

As Airbus’ first aircraft lifecycle service center outside Europe, it will provide parking, storage, maintenance, upgrading, modification, dismantling and recycling services for all types of aircraft, said Airbus.

Honeywell, a U.S. industrial conglomerate, will join hands with local partners to explore the great market opportunities in China’s sustainable aviation fuel (SAF) sector, according to a senior executive with the company.

Standards Australia and the Office of the NSW Building Commissioner (OBC) are partnering in an effort to improve fire safety in the state’s residential apartment buildings.

An audit between September 2021 and September 2022 by NSW Fair Trading found 46% of NSW residential apartment buildings had serious defects in fire safety systems.

A subsequent report by the OBC identified a range of practical responses the NSW Government could apply to improve outcomes for industry and consumers, and a key recommendation was raising the capability of fire safety practitioners through practical training and certification.

In response to the findings of the report, Standards Australia and OBC have developed a training and education systems on fire safety measures for fire doors, to be delivered by TAFE NSW’s Construct NSW Digital Learning Platform.

The course aims to increase industry awareness of the importance of maintaining this crucial fire safety system with fire safety practitioners, fire engineers, certifiers, architects, builders, strata managers, and anyone who is involved in the design, installation, maintenance, and verification of fire doors.

The revised materials also intends to help professionals better understand and comply with fire protection standards.

Topics covered by the Fire Doors Course include:

• Identifying when and where fire doors are required.
• Identifying standards relevant to fire doors.
• Identifying the minimum standard of performance and operation for different fire doors.
• Inspecting and assessing whether fire doors are operating as required.
• Completing the relevant aspects of the approved fire safety statement form.

The new education and course materials is recognized as continuing professional development (CPD) by the Fire Protection Accreditation Scheme (FPAS), now a mandatory accreditation for fire safety practitioners in NSW. It references relevant Australian Standards in the 1905 series for fire-resistant building components.

Standards Australia’s General Manager, Engagement and Communications – Adam Stingemore visited Hanoi this week to meet with Dr Ha Minh Hiep, Acting Director General of The Directorate for Standards, Metrology and Quality (STAMEQ) – they signed a Memorandum of Understanding (MoU), intended to facilitate collaboration in international standards development.

ECONOMIC ENGAGEMENT STRATEGY

Australia and Vietnam share an ambition to further strengthen their economic ties through increased bilateral trade and investment, with a commitment to sustainable and inclusive economic growth as set out by the Australia-Vietnam Enhanced Economic Engagement Strategy.

View more details at EEES-AUSTRALIA-VIETNAM.

The MoU is intended to provide a basis for cooperation between Standards Australia and STAMEQ, recognizing the benefits and advantages of collaboration in standardization to eliminate technical barriers to trade and promote international competitiveness to meet the needs of industry and consumers.

This announcement reflects the growing importance of economic partnerships in the Asia-Pacific region and is a positive step toward fostering opportunity between the organizations, with Standards Australia collaborating with Vietnam on participation in international standards adoption and development, focusing on digital transformation.

This includes projects underway, such as our Critical and Emerging Technologies (CET) in South-East Asia project that Standards Australia was delivering in Hanoi this week, but also potential for future work to further cooperation on standards harmonization and enhanced trade between Australia and Vietnam.

The agreement also supports implementation of regional trade agreements such as the Regional Comprehensive Economic Partnership Agreement (RCEP), and the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).

Chinese President Xi Jinping on February 10 announced a 300 million yuan ($44 million) grant package to support the Kingdom’s railway ambitions, which are expected to improve the livelihoods of many Cambodians, according to National Television of Cambodia (TVK).

This comes during a meeting between Xi and Prime Minister Hun Sen on the second day of his February 9-11 visit to China.

According to TVK, the two leaders agreed at the meeting to foster a “diamond-” like cooperation, pushing bilateral relations to a “new peak”, with Xi thanking Hun Sen for his public declaration that, “if I don’t rely on China, who would I rely on?”

China’s assistance has driven progress of Cambodia, and consolidated the Kingdom’s sovereignty, the premier said.