Cargill Inn and Asia Society for Social Improvement and Sustainable Transformation (ASSIST), a foreign non-governmental organisation, on May 8 announced their partnership and the launch of Green Aqua project which aims to reduce water pollution through promoting the application of sustainable aquaculture practices in the Mekong Delta region.

The project will be implemented until July 2026, initially in Ca Mau province. It aims to provide training for more than 300 shrimp farmers on farming practices towards the Aquaculture Stewardship Council (ASC) standards on responsible aquaculture, as well as animal feed, waste management, and biodiversity preservation.

Ten outstanding trainees will have a chance to attend intensive training, enabling them to transfer farming techniques to their fellows in the following periods.

At the same time, a shrimp farming cooperative will have the opportunity to receive an ASC certificate, while three pilot farms will strive to reduce wastewater by 30% and cut nitrogen and phosphorus emissions by 20% by 2025.

The southernmost province of Ca Mau is the largest shrimp production hub in the country with a total farming area of 280,000 hectares.

During the two years of pilot implementation, the project will focus on supporting shrimp farms and creating a positive impact on the shrimp farming area across the province, while building local farmers’ capacity to adapt to climate change.

The project is expected to contribute to coping with climate change challenges, improving the environment quality through promoting and strengthening processes to sustainably use water resources and treating waste in the aquaculture sector of Ca Mau in particular and the Mekong Delta region in general./.

US puts brakes on investigation into steel rolls imported from Vietnam

The US Department of Commerce (DOC) has terminated its scope review investigation into steel rolls imported from Vietnam, according to the Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade.

The agency said the decision was announced by the DOC on April 30, ending the investigation initiated on August 7, 2023.

The petitioner, Dexstar Company of the US, submitted a request to the DOC to initiate a scope review investigation into steel rolls completed in Vietnam from components originating in China, which fall within the scope of the anti-dumping and countervailing duty orders that the US is applying to similar products from China.

Based on the information and documents collected during the investigation, the DOC on March 15, 2024 announced its intention to terminate the work./.

Binh Duong hosts Vietnam Paper Packaging Exhibition 2024

The Vietnam International Paper and Packaging Exhibition (VPPE) 2024 and the 3rd Vietnam International Electricity, Energy, Industrial Machinery and Automation (EMA Vietnam) 2024 kicked off in the southern province of Binh Duong on May 8, attracting hundreds of exhibitors.

With 300 booths, VPPE 2024 introduces products relating to paper and pulp, packaging, machinery, equipment, technology, chemicals, and materials for the paper and packaging industries from nearly 500 brands of Vietnam, Japan, China, the Republic of Korea, India, Sweden, Finland, Germany, Italy, and others.

Meanwhile, EMA Vietnam 2024 features 300 pavilions, showcasing impressive technologies in the fields of electricity, energy, industry, and automation of 300 businesses from many countries and territories worldwide.

Addressing the opening ceremony, Chairman of the provincial People’s Committee Vo Van Minh said apart from introducing brands, the exhibitions help businesses access potential customers and partners.

Alongside exhibition activities, specialised seminars and business-networking programmes will also be organised in the framework of the events, offering opportunities for businesses to seek partners, expand business networks and explore new markets.

The three-day exhibitions are expected to attract 10,000 visitors./.

Vietnam outstanding export products fair opens in HCM City

The Vietnam Outstanding Export Products Fair or HCM City Export 2024 opened in Ho Chi Minh City on May 8 at the Saigon Exhibition and Convention Centre.

The four-day event features 450 booths from 400 leading export-oriented enterprises in key industries of Vietnam, doubling those in the first edition held in 2023.

The fair focuses on key exports, including food, beverage, agricultural and aquatic products, wood and handicraft items, textile - apparel, leather - footwear, handbag, rubber - plastics, and electronics - mechanics, to assist businesses and exporters of HCM City and Vietnam as a whole to seize chances from recovering markets.

HCM City Export 2024 looks to help businesses engage in global supply chains and set up close partnerships with foreign distribution systems.

Nguyen Nguyen Phuong, Deputy Director of the department, said that many indexes of industrial production, trade and export in the city have increased significantly in the first months of 2024. The fair aims to help enterprises seek partners, overcome difficult period when the market’s demand has been slugging.

In the first four months of 2024, export turnover through ports in the city reached 12.5 billion USD, up 69.2% over the same period last year.

Notably, many items with impressive export growth include textiles and garments with 1.2 billion USD, up 40.3%; machinery, equipment and spare parts with 912.8 million USD, up 40.6%; transport vehicles and spare parts with 241.4 million USD, up 47.1%; and wood and wood products with 175.6 million USD, up 80.3%.

A series of other activities will also take place such as business-to-business sessions where companies can meet representatives of international buyers like Central Retail and MM Mega Market, or major e-marketplaces such as Amazon and Alibaba to bring their quality products to consumers around the globe.

Fair-goers will have a chance to receive attractive promotional programmes./.

Canada regards Vietnam as gateway to the Indo-Pacific

Quebec always considers Vietnam a gateway to the Indo-Pacific - a rapidly growing and dynamic region, according to Director of the Federation of Chambers of Commerce of Quebec Florent Favrel.

After the successful trip to Vietnam and Malaysia by the Canadian trade delegation, led by Minister of International Trade Mary Ng, Ottawa is actively targeting this region with activities to prepare for the Northern American country's businesses to invest and do business successfully in the Indo-Pacific.

The recent "Gateway to the Indo-Pacific" event was jointly organized by the Canadian Chamber of Commerce and the Export Development Canada (EDC) serving as a forum to help Canadian businesses get a deeper insight into business prospects as well as necessary solutions to achieve success in the region that is considered dynamic and extremely rapidly developing.

Vice President of Strategic Policy & Global Partnerships at the Canadian Chamber of Commerce Catherine Fortin LeFaivre highlighted the event "Gateway to the Indo-Pacific" held in Montreal as an opportunity for businesses to better understand opportunities in this region, through experts from businesses and research organizations and people with practical experience.

This will help enterprises outline more direction to consider expanding their business activities in the Indo-Pacific.

Canada is currently accelerating the implementation of the Indo-Pacific Strategy, whereby the country has invested around US$2 billion focusing on the trade sector to build more links and strengthen its presence in the region.

In this strategy, the Association of Southeast Asian Nations (ASEAN) is considered by Canada to play a central role and the two sides have seen significant development in all aspects of the relationship.

Asia-Pacific Foundation of Canada President and CEO Jeff Nankivell commented that one of the elements of the Indo-Pacific Strategy is to organize field trips for Canadian trade delegations, where brings together both government and business representatives.

Canada's trade delegation recently visited Malaysia and Vietnam and is expected to visit Indonesia and the Philippines later this year.

According to Jeff Nankivell, Canada is also opening offices to carry out tasks such as the Ministry of Agriculture in the Philippines, which serves as a center for agricultural products and agri-food products in the region. Vietnam will also play an important role in these activities as it boasts the greatest potential for expanding relationships.

 In addition to the Philippines, Canada also has a Southeast Asia Trade Office in Singapore, and an Innovation Office which is about to open in Vietnam. The country is negotiating a free trade agreement with Indonesia in particular and ASEAN as a whole, he said.

According to Olivia Lee, Chief Representative, Southeast Asia at Export Development Canada, this region offers great potential for Canadian firms, especially in three growth areas: infrastructure, farm produce and progressive manufacturing fields.

One of the main things the agency sees in Vietnam at present is the energy transition, including increased development of wind and solar energy, Lee stated.

Nankivell said that Canadian public opinion currently shows a very high level of interest in developing and expanding relations with Vietnam.

Canadian universities and colleges are seeking to attract more students from Vietnam, while Canadian businesses are looking to invest in the Southeast Asian nation and also want to attract Vietnamese investment in a certain new field.

In the agriculture and agri-food sector, potential has also been identified for Canadian businesses and vice versa. With more than 30 years of experience working in the field of Canada - Asia relations, he believes that both sides have the best conditions in the relationship in all aspects.

Director of the Federation of Chambers of Commerce of Quebec Florent Favrel described "Gateway to the Indo-Pacific" as an extremely useful event which provided a lot of information about the potential of the Indo-Pacific region, especially Vietnam. 

Vietnam is one of the first doors that Quebec businesses should open because of great potential that the nation can bring to them, he added.

Cooperatives urged to focus on branding to expand exports of organic teas

Cooperatives have been advised to focus on branding and improving product quality to expand tea exports to highly-demanding markets, especially organic tea products.

A report by the Center for Digital Transformation and Agricultural Statistics showed that the organic tea cultivation areas remain modest in Việt Nam, estimated at around 8,000ha or 6 per cent of the country’s total tea growing area.

In Thái Nguyên Province which is home to the country’s largest tea growing area of nearly 23,000ha, there are only 100ha certified organic.

Tea growing area certified organic by the EU is only at 2,500ha.

To expand exports to demanding markets with strict requirements of food hygiene and safety, getting organic certifications is critical.

Trần Thị Bình, director of Thành Đạt Organic Agricultural Cooperative in Thái Nguyên Province, said that they want support to improve product quality and expand exports.

Đào Thanh Vân, Deputy President of Việt Nam Organic Agriculture Association, said Việt Nam has around 100,000ha of tea growing area but the tea export price at US$1.6 per kg is very low.

Phạm Văn Tiến from Cao Sơn Tea Cooperative said that the market remains the biggest difficulty to cooperatives producing organic teas. Another problem is the weak linkage between farmers and enterprises in establishing tea value chains, he said.

Meanwhile, climate change is significantly affecting tea cultivation.

Currently, Việt Nam ranks fifth in the world in terms of tea export but it is mainly exported in raw forms with a lack of originality, making it difficult to compete in the global market so the added value for tea growers and cooperatives remains modest.

According to David Lyons, director at Australian Tea Cultural Society, the focus should be on building brands for Vietnamese tea products to expand exports to strict markets like Australia.

Impressive brands are important to develop loyalty customers, he said, adding that attention should also be paid to packaging.

Thân Dy Ngữ from Hiệp Thành Limited Company said that cooperatives and farmers should connect with each other to increase output and ensure quality for domestic production and exports.

Statistics showed that Việt Nam exported 28,000 tonnes of tea in the first three months of this year, worth $45 million, an increase of 30 per cent and 27.2 per cent, respectively, over the same period last year.

In 2023, tea export was estimated at 121,000 tonnes, worth $211 million, dropping by 16.9 per cent in volume and 10.9 per cent in value over 2022, on falling consumption demand in the global market. 

HCM City works to put Metro Line No. 1 into operation soon

Ho Chi Minh City's Metro Line No. 1 (Ben Thanh–Suoi Tien) is close to the finish line but is facing some difficulties, thus the local administration and the investor are making efforts to remove obstacles so that the it can start commercial operation soon.

According to HCM City’s Management Authority for Urban Railways (MAUR), 98% of the workload on the project has been completed.

Training for the operation of the metro line and preparation for acceptance work are underway. However, there are problems between contractors and project consultants.

According to the project’s investor, contractors and consultants for Metro Line No. 1 have not agreed on the early handover of equipment and infrastructure for training, acceptance, and trial operation, resulting in a possibility that the metro line could not start commercial operations by the end of this year as scheduled.

Earlier in March, the municipal People’s Committees set up a task group to settle difficulties related to the project. To date, the task group has held three meetings on the issue.

Chairman of the municipal People's Committee Phan Van Mai also sent a letter to the Japanese Ambassador to Vietnam, in which he affirmed that the city will consider the Japanese side's proposal to resolve disputes through the Dispute Adjudication Board (DAB). The city also asked the Japanese side to pool all resources so that contractor Hitachi can complete the trial operation of bidding package CP3 in May and the handover of a number of carriages and equipment required for the NJPT Consortium, the general consultant of the project, to conduct practical training.

The investor, general consultant and contractor have coordinated with the Fire Prevention and Fighting Police Department to conduct fire prevention inspection and acceptance for each item and the entire project.

Regarding personnel training, training work at Ho Chi Minh City Urban Railways No. 1 Company Limited, which is responsible for operating and managing the metro line, will be finished by the end of third quarter.

The Ben Thanh-Suoi Tien metro line runs 19.7km between District 1's Ben Thanh Market and Thu Duc city's Long Thanh Depot with three underground stations and 11 elevated stations. Work on the metro project started in 2012 and has gone through various delays. Its costs have risen to over 43.7 trillion VND (1.71 billion USD)./.

Appropriate policies needed for harmonized interests between farmers, businesses

For the development of the government's large paddy field in the Mekong Delta, harmonized benefits between farmers and businesses are important; therefore, it needs appropriate policies and other factors.

The workshop on developing sustainable links in the rice value chain was jointly held by the Coordination Office for Agriculture and Rural Affairs in the Mekong Delta under the Ministry of Agriculture and Rural Development, the School of Public Policy - Rural Development and the People's Committee in Can Tho City today in Can Tho City.

Deputy Minister of Agriculture and Rural Development Tran Thanh Nam, representatives from the Vietnam Rice Sector Association; businesses and organizations in the rice industry chain in the Mekong Delta.

According to the Vietnam Rice Industry Association, policies, scientific and technical advances, and capital directly and indirectly affect the purchase of rice in the Mekong Delta and the relationship between farmers, cooperatives, traders, enterprises, distributors and consumers also have an impact on the benefits of farmers and businesses.

Farmers’ rice will be distributed through the distribution channel. Accordingly, traders will help sell 49 percent of total rice in the region, while cooperatives 32 percent, milling factories more than 12 percent and rice processing and export enterprises more than 6.5 percent. Meanwhile, the direct consumption channels of cooperatives include businesses accounting for nearly 61 percent, milling factories accounting for more than 22 percent and traders accounting for more than 16 percent.

At the workshop, engineer Vo Quoc Trung from the Agricultural Extension Center in Soc Trang Province talked about the results of the investigation on the role of traders in the rice consumption chain. Accordingly, no farmers have so far contacted businesses directly but brokers. Specifically, rice growers sell rice through consumption channels including agricultural cooperatives (accounting for 5-7 percent) and local brokers (90-93 percent). Agricultural cooperatives and intermediaries will directly work with businesses for export and domestic consumption. Farmers also sell their rice to drying or milling establishments but traders also help farmers connect with these establishments which sell rice for domestic buyers.

Traders act as a bridge, an indispensable link in the current consumption chain, said engineer Trung. Without traders, the province's 2.1 million tons of rice is hardly consumed quickly. Currently, the project of large fields is at risk of destruction as farmers take advantage of sowing seeds and have the mentality of selling early when rice prices are high.

Businesses need to consider maintaining contracts signed with farmers when rice prices increase or decrease, each party bears 50 percent in this part. It is necessary to harmonize the interests of farmers and businesses to develop large fields, said engineer Vo Quoc Trung.

Chairman Huynh Van Thon of the Board of Directors of Loc Troi Group agreed with engineer Vo Quoc Trung's opinion, especially in the context of implementing the project ‘Sustainable development of 1 million hectares specializing in high-quality rice cultivation and low emissions associated with green growth in the Mekong Delta until 2030’

Vice Principal Tran Minh Hai of the School of Public Policy and Rural Development said that the present rice chain in the Mekong Delta has seen the participation of many intermediaries. Among them, traders or barn owners, are people who clearly understand the chain. Businesses prefer to buy rice through traders because it helps businesses feel less stressed about spending capital because they do not have to advance money to farmers for a long time (2-3 months) while farmers prefer to sell to traders because they can get money immediately after sell their agricultural products.

The government or responsible agencies should encourage traders to voluntarily gather into groups and clubs to exchange experiences and access training content and technical guidance in preservation, transportation, and processing with the aim of ensuring quality, food safety and hygiene, said Vice Principal Tran Minh Hai.

According to Director Le Duc Thinh of the Department of Cooperative Economics under the Ministry of Agriculture and Rural Development, rice value chain links have improved, with more diverse models and more sustainable models. However, the scale of area, output, and number of farmer households participating in the association are still small. The scale of association of businesses and cooperatives is not as large as expected while not many cooperatives and businesses have linked. Worse, linkage between cooperatives and businesses is not sustainable resulting breach of contracts.

Carbon credit export from rice, coconut production

In 2023, Vietnam achieved its first sale of 10.3 million forest carbon credits (equivalent to 10.3 million tons of CO2), generating around US$51.5 million (VND1.25 trillion).

The development of the carbon market has spurred the growth of green and circular economies while providing substantial financial gains for the nation. The Mekong Delta region, notably, has been identified as having significant potential in this market.

With over 143,000 hectares of forest and forestry land, Ca Mau province possesses significant potential and advantages in the formation and development of the carbon market. Since 2020, the provincial authorities have organized meetings for residents, forest owners, and businesses to hear expert talks and receive advice on carbon market-related issues. According to experts, forest carbon credits stem from greenhouse gas emission reduction projects, reducing deforestation and forest degradation, promoting forest planting, care, protection, and development, and encouraging vegetation regeneration. Forest owners can convert the amount of CO2 absorbed from managed forest areas into carbon credits for trading on the market.

Mr. Le Van Su, Deputy Chairman of the People's Committee of Ca Mau Province, assessed that implementing forest carbon absorption and storage services would provide a significant and sustainable financial source for the locality each year. This funding will support effective forest management, planting, care, protection, and development, reducing pressure on the State-budget-funded investment into the forestry sector. However, the implementation of this activity faces challenges due to the lack of a legal framework and detailed technical guidelines on transfer, benefit sharing, and determining carbon credit prices. Therefore, he hopes that the central government will soon complete the legal framework regarding carbon credit counting, certification, and trading, enabling Ca Mau and other localities to effectively tap into the potential of the forestry economy.

In Kien Giang, the representative from the VnSAT Project Management Board in Kien Giang Province announced that in 2024, Kien Giang would participate with 60,000 hectares of rice cultivation in the Sustainable Development of One Million Hectares of High Quality and Low-Emission Rice Associated with Green Growth in the Mekong River Delta by 2030. Accordingly, they plan to sell carbon credits for approximately 30,000 hectares. By 2025, the province aims to expand the area of high-quality, low-emission rice cultivation to 100,000 hectares, with an estimated sale of carbon credits for around 40,000 hectares.

Analyzing the benefits of carbon exploitation in rice production, Mr. Huynh Van Thon, Chairman of Loc Troi Group, highlighted that rice production currently contributes to approximately 50 percent of greenhouse gas emissions. Vietnam is actively addressing this issue to achieve zero net emissions, as committed. Furthermore, Vietnam is establishing a sustainable rice production ecosystem with internationally recognized farming practices. Specifically, the government has initiated the Sustainable Development of One Million Hectares of High Quality and Low-Emission Rice Associated with Green Growth in the Mekong River Delta by 2030. While the processes and direction are already established, the remaining challenge lies in how managers can effectively organize and mobilize farmers to align with these objectives. By accomplishing this, the utilization of carbon credits in rice production will yield significant future benefits.

According to the Department of Agriculture and Rural Development of Ben Tre Province, there are approximately 78,000 hectares of coconut trees in the province. This presents a favorable opportunity for selling carbon credits derived from these "coconut fields." In July 2024, Ben Tre will host a workshop focusing on the establishment and development of the carbon market for coconut trees. While the carbon credit market holds great potential, Vietnamese enterprises encounter various obstacles and financial challenges in entering this market. Therefore, Vietnam needs to strategize and implement solutions to overcome these barriers effectively.

As per the Ministry of Agriculture and Rural Development, to exploit and sell carbon credits from rice production, the rice production region in the Sustainable Development Project for 1 million hectares of high-quality rice cultivation in the Mekong Delta must ensure specific production conditions. These conditions entail reducing rice seed usage to 80kg per hectare, cutting chemical fertilizer application by 30 percent, minimizing chemical plant protection products by 40 percent, and decreasing irrigation water consumption by over 30 percent. Furthermore, the adoption rate of Good Agricultural Practices (GAP) and equivalent practices must reach 100 percent, while the incorporation of advanced technology and digital solutions should exceed 50 percent. Greenhouse gas emissions should be curtailed by over 20 percent, and the collection and utilization of rice straw, covering 100 percent of harvested areas, is imperative.

Banks strengthen information security systems

Banks have implemented many new technology solutions to ensure information security in the context that digital transformation in the banking industry has been promoted strongly.

Phan Việt Linh, director of CDNetworks Vietnam, said the speed of digital transformation in the finance and banking sector in Việt Nam is growing quickly and strongly. At the same time, banks often face attacks from high-tech criminals to steal customer data to conduct property appropriation fraud. Therefore, banks must strengthen defence measures to ensure safety and security in their systems.

Nguyễn Văn Minh, deputy general director of KienlongBank, said KienlongBank has always focused and invested in information security. As a pioneer bank in digital transformation, KienlongBank has deployed technology solutions and modern application systems to handle huge amounts of customer information and transactions. Investment in technology and security systems is a top priority for KienlongBank.

To strengthen solutions ensuring information security and safety, Minh said KienlongBank has proactively strengthened network security systems and built strict information security processes. In the first three months of 2024, KienlongBank has coordinated with experienced partners in the field of security and cybersecurity, such as Viettel Cyber Security, VNPT Information Technology Company, FPT Telecommunications Joint Stock Company, Ernst & Young Vietnam Co., Ltd., and SafeGate Smart Network Security Joint Stock Company, organise system penetration testing to proactively ensure information security.

According to Orient Commercial Joint Stock Bank (OCB), as fraud in the banking and finance sector is on the rise, OCB also continuously implements internal and systematic evaluation and review methods to detect and absolutely prevent customer information being stolen.

Trần Quang Hưng, deputy director of the Ministry of Information and Communications’ Information Security Department said information security in the banking system plays an important role. With a large amount of bank and customer data, the security of customer information in particular and banking data in general is mandatory for all credit institutions. Therefore, banks need to be equipped with modern technology and constantly strengthen their capacity as well as invest in security.

The State Bank of Vietnam has also issued many regulations to request credit institutions to implement measures to ensure security and safety in operations, including Directive 02/CT-NHNN on promoting digital transformation and ensuring information security and safety in banking activities. 

Central beach city to lure investment from potential partners

The central city’s People’s Committee has officially issued an investment promotion programme for 2024 aiming to diversify partners and investment flows for new development.

The city said the programme will focus on calling potential domestic investors in hi-tech industries, semiconductor, information technology as well as giant technology companies from the the Europe Union, the US, Japan, South Korea, Singapore, India, and Taiwan (China).

It said the central hub will welcome all investors with planning for investment expansion or fund flow moves in the region.

Đà Nẵng has mapped out its Master Plan in 2021-30 with a vision to 2050, opening smooth options for domestic and foreign partners in line with the city’s strategic development plan for the next decades.

In boosting promotion events with partners, the city will seek collaboration with organisations including – the Việt Nam Chamber of Commerce and Industry (VCCI), Japan External Trade Organisation (JETRO), the Korean Chamber of Business in Việt Nam (KOCHAM), the American Chamber of Commerce in Việt Nam (AMCHAM), Indian Business Chamber in Việt Nam (Incham); the European Chamber of Commerce in Việt Nam (EuroCham) and  the German Chamber of Commerce Abroad in Việt Nam (AHK) – in hosting investment studies and market access research as well as business links.

The investment promotion programme will also include support and positive solutions in clearing barriers in investment procedure for investors.

It also emphasised the importance of building investment links and friendship ties with the US, Australia, the EU, Finland, the UK and Denmark, speeding up possible key investment projects in Đà Nẵng.

The central city signed Memorandums of Understanding (MoUs) with the Asian Development Bank (ADB) and the United States Agency for International Development (USAID) for comprehensive and sustainable development in the Master Plan 2021-30, vision 2050, at Meet Đà Nẵng 2024.

Đà Nẵng’s Semiconductor and AI Centre (DSAC) was also debuted early this year, setting up a foundation for investment flow of semiconductor industry from the US, Taiwan (China), Japan and the EU.

The beach city has been in discussions with TheCityUK, the industry-led body representing UK-based financial and related professional services, in building an international financial centre (IFC).

The National Assembly of Việt Nam has agreed on the pilot project developing Đà Nẵng Free Trade Zone.

To date, the city has attracted 1,016 FDI projects worth US$4.2 billion. 

Forecasts upbeat for banks’ 2024 profits

Vietnam’s banking sector is projecting a period of robust growth and profitability, underpinned by strong first-quarter performances and optimistic forecasts for economic recovery and credit expansion.

At SHB’s 2024 AGM last week, CEO Ngo Thu Ha unveiled a pre-tax profit target of approximately $470.25 million, a 22.2 per cent increase over the previous year’s performance. Despite global economic uncertainties, Ha is confident in achieving these goals, citing an already robust profit of over $166.67 million by March.

Elsewhere, Nguyen Hoang Linh, CEO of MSB, reported significant growth at the close of the first quarter, with total assets reaching about $11.67 billion, marking over a 4 per cent increase.

“MSB saw a credit growth of over 5 per cent in a slowing sector, with customer loans and deposits growing by 4.7 and 4.1 per cent respectively. MSB’s pre-tax profit stood at more than $63.75 million, fulfilling 22.5 per cent of its yearly target,” Linh shared.

At TPBank, CEO Nguyen Hung announced a 2024 pre-tax profit goal of roughly $312.5 million, a 34 per cent on-year increase. With first-quarter profit of approximately $76.21 million and projected earnings surpassing $104.17 million by April’s end, TPBank’s targets are within reach.

VIB also showed a strong performance, with a first-quarter pre-tax profit exceeding $104.17 million; SeABank’s first-quarter results saw consolidated pre-tax profit of $62.75 million, a nearly 41 per cent increase from the previous year; and VPBank recorded nearly $174.58 million in consolidated pre-tax profit in the period, a 66 per cent increase over the prior quarter and 64 per cent on-year.

LPBank stood out with a first-quarter pre-tax profit of $120.25 million, completing 27.5 per cent of its annual goal and achieving an 84.4 per cent increase on-year. An LPBank executive cited a fourfold increase in net service income from the same period in 2023, alongside strong net interest earnings and efficient cost management as key growth drivers.

These performances highlight a departure from the cautious outlook depicted in earlier surveys by the State Bank of Vietnam, with many banks now pushing aggressively to boost service income to compensate for slower credit growth. For example, TPBank’s securities investments and MSB’s foreign exchange operations have contributed significantly to their profits.

While some banks like BAC A BANK showed modest growth and others like PGBank experienced declines, the overall trend suggests a positive shift in the banking sector’s performance.

Tran Thi Khanh Hien, head of Research at MB Securities (MBS), reported significant early-year advances within the Vietnamese banking sector, leading to notably higher industry valuations.

“Currently, the sector’s price-to-book ratio stands at 1.66, marking a 6.7 per cent increase over the annual average, albeit remaining 8.7 per cent below the three-year average,” she told VIR.

Dr. Can Van Luc, chief economist at BIDV Training School, provided an optimistic forecast, anticipating stronger profits based on the modest growth foundations set in 2023.

“Performance will vary among institutions, with differentiation driven by factors such as financial capacity, approved credit growth plans, asset quality, and fee-based income,” he said. “Notably, smaller banks may struggle to accelerate growth and could face deceleration due to competitive challenges in attracting low-interest deposits.”

“Next year’s economic recovery is poised to spur credit growth rates to between 14-15 per cent, eclipsing those seen in 2023, thereby bolstering income from core credit services as well as ancillary financial offerings such as payment solutions, digital banking, and foreign exchange activities,” Luc added.

Despite these positive indicators, Luc cautioned that several challenges could temper growth prospects, including rising risk provisioning in response to bad debts, and potential declines or persistently low values of secured assets. He also pointed out that major revenue streams from previous stages, such as bancassurance and off-balance sheet debt collection, might not quickly rebound.

“Additionally, operational costs are expected to rise owing to investments in technology and increasing salary expenses driven by government guidelines and the need to remain competitive in talent acquisition,” Luc stated.

Hien of MBS emphasised that certain banks are likely to outperform the industry average. She argued that banks that can maintain a resilient net interest margin, even amid interest rate cuts aimed at fostering competitive credit growth, would likely fare well. These banks typically benefit from a low cost of funds and strong CASA ratios.

“Banks with a stable and expanding credit portfolio, anchored by a loyal customer base, and those that have significantly enhanced their asset quality with substantial provisioning in 2023 are likely to experience reduced provisioning pressures in 2024. This will notably enhance their after-tax profits relative to the broader industry,” Hien said.

Financial barriers still remain for true industrial symbiosis

Despite having great potential for implementing industrial innovation, Vietnam lacks financial incentives for businesses in executing industrial symbiosis model and preventing them from taping into a circular community.

According to Lien Nguyen, a freelance consultant in renewable energy, the government should have clear and stable policies to support university and research institution engagement with renewable energy ventures.

“Policies for promotion of the recycling industry remain insufficient,” Nguyen said at a conference on advancing the circular economy in Vietnam’s industrial parks (IPs), held in mid-April in Ho Chi Minh City by the Ministry of Planning and Investment and the United Nations Industrial Development Organisation (UNIDO).

“In addition to that, the procedures for reuse and recycling of waste, particularly waste being sent outside companies, as well as market for exchangeable secondary materials and by-products, are all in a shortage,” Nguyen said.

Industrial symbiosis is a must for an eco-IPs and an integrated part of the circular business model. A subset of industrial ecology, it describes how a network of diverse organisations can foster eco-innovation and long-term culture change, create and share mutually profitability, and improve business and technical processes.

According to Nguyen, the model requires the collaboration of government, universities, research institutions, and industries in upscaling the circular economy.

“Businesses should be guided to use material flow analysis tools in developing strategies to foster the circular economy, including industrial symbiosis,” Nguyen said.

Vietnam has great potential in this area as it has around 420 IPs throughout the country. It also boasts diverse types of industries in selected IPs and a fast growth of disruptive technologies.

According to Christian Susan, manager of UNIDO’s Global Eco-IP Programme, industrial symbiosis is a form that helps companies gain a competitive advantage through sharing services with other companies or with surrounding areas. “They can also cooperate to exchange specific products, energy, water, and by-products with other companies or regions, thereby promoting comprehensive and sustainable development,” said Susan.

“IPs with a large concentration of businesses become ideal platforms for promoting business synergy approaches. Symbiotic relationships between businesses help reduce the resource demand and can sustain resource use over longer periods of time and for multiple purposes, thereby promoting circularity,” Susan added.

Pham Hong Diep, chairman of the board of Shinec, the investor of Nam Cau Kien IP located in thê northern port city of Haiphong, said that industrial symbiosis chains in the IP are implemented with a circular economic model, including metallurgy, mechanical engineering, plastic products, and electrical and electronic accessories. “Within this year we will move towards zero waste through applying this model,” Diep told VIR.

In the past, steel slag at the IP had to be processed, and the manufacturer had to pay over $200 million per tonne, but now it can save this fee instead. The purchaser will process steel slag at high temperatures and separate it into other materials to sell to factories that use it to produce magnets and additives for cement production.

Steel scrap is also produced into auxiliary products and components for the electrical industry, including assembling electronic components and equipment for the automobile industry and cable companies.

“Such an example shows that waste becomes a resource through symbiotic waste resources of businesses, and the output is secondary finished products. This also helps create a larger market for recycled raw materials and materials with reliability and high-quality standards,” Diep said.

With this closed process and circular production, discarded items that previously had no value are now important raw materials, increasing revenues for businesses.

“Thanks to this benefit, Nam Cau Kien IP has occupancy of more than 80 per cent, even though the land rental price here is higher than other parks,” Diep said.

Rooftop solar power puts IPs on the map

Transferring to renewable energy through installing rooftop solar power systems is set to help foster competitive capacity and further the sustainable development of businesses.

The growth rate of the rooftop solar market in Vietnam is considered one of the fastest-growing segments in terms of new installed capacity in the next 10 years.

With that, the Vietnamese government is promulgating policies to encourage the installation of rooftop solar power systems in industrial parks (IPs). After a meeting on the issue on April 10, Deputy Prime Minister Tran Hong Ha assigned the Ministry of Industry and Trade (MoIT) to coordinate with the Ministry of Justice and relevant agencies to develop a decree stipulating policies to encourage rooftop solar development, to be installed in homes, offices, and IPs.

The MoIT is also assigned to coordinate with relevant ministries and sectors as well as Vietnam Electricity to develop a set of model documents that specifically stipulate standards, technical regulations, and state management requirements in encouraging the development of rooftop solar power. The mechanism is expected to be implemented in the spirit of transparency and openness.

Apple supplier Foxconn is on the journey to install a rooftop solar power system for its factories with a total capacity of 32MWp, accounting for 20 per cent of Foxconn’s current factory roof area in Vietnam. From June 2023, it has successfully operated 19MWp of rooftop solar capacity for its factories in the northern province of Bac Giang.

Several global manufacturing giants such as Samsung and LG are following Foxconn’s path and plan to announce specific energy transition plans in Vietnam. Additionally, other outsourcing manufacturers for Adidas, Nike, and other apparel and footwear brands have also recently actively switched to rooftop solar.

Chung Dieu Tuan, CEO of foreign-invested enterprise CME Solar, said, “The main market driver is the increased demand for rooftop solar installations in the manufacturing sectors of foreign-invested enterprises in Vietnam, especially the electronics/ semiconductor and textile industries. As part of the global effort to commit to net-zero emissions, international brands and manufacturers in Vietnam must meet the energy transition requirement to renewable sources.”

CME currently boasts rooftop solar power systems for a series of domestic and foreign-invested groups, such as Hwaseung Vina, an Adidas research and development centre, CJ Vietnam, Puratos Grand-Place Vietnam, Nam Dinh Vu Industrial Park, and Song Hong Garment JSC, among others.

These moves are expected to help realise the target that by 2050, 80 per cent of factories will install rooftop solar power systems, and the ratio for houses and office buildings is 20 per cent.

A Savills 2022 report stated that the total industrial and commercial roof area is about 80,000 hectares and the estimated annual growth rate is 10 per cent, while the total roof area used for the production of solar energy accounts for only 8 per cent.

Statistics from the Vietnam Energy Partnership Group show that as of June 2023, the total installed capacity of solar farms and rooftop solar power is estimated at 8GW, much higher than the 1GW witnessed at the end of 2020.

The market demand for low-emission products is both a pressure and a driving force pushing IPs and tenants to change and shift towards a circular economy, towards sustainable development. Thus, currently, businesses in various industries are in dire need of incentives and procedures to develop rooftop solar power.

Truong Van Cam, vice president of the Vietnam Textile and Apparel Association, said, “Installing rooftop solar power is in line with the state’s policy of reducing energy from fossil fuels, reducing greenhouse gas emissions, and implementing the net-zero commitment by 2050. In addition, it also meets requirements in many other garment and textile markets, which require products with a green origin and using renewable energy.”

The textile and garment industry has around 1,200 businesses with over 600,000 workers located in IPs. Currently, about 30-50 per cent of businesses depending on the region have installed rooftop solar power, Cam said.

“Besides the problem of disposing of solar panels, there is also the problem of waste treatment and how to recycle it so as not to be a burden on the environment. Thus, there will soon need to be specific regulations on purchasing and using rooftop electricity in IPs and economic zones,” he added.

According to Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc at a forum on promoting the sustainable development of IPs in mid-April, the transition towards green energy is a key factor in increasing competitiveness and ensuring sustainable development for each IP, locality, and the overall economy.

In Vietnam’s 16 free trade agreements and negotiation of several others, requirements on clean and green production stages are critical so that businesses can participate in demanding markets. Additionally, the goal of sustainable industrial development has been included in the United Nations’ sustainable development commitments.

Retail sales, services revenue up 8.5% in four months

Retail sales and services revenue in the first four months of this year totaled 2.06 quadrillion VND (81.06 billion VND), up 8.5% year-on-year, the General Statistics Office (GSO) said.

In April alone, the value was 522.1 trillion VND, a rise of 9% from the same period last year, with food and foodstuff sales up 10.3%, household utensils 12.9%, garment 12.7%, lodging and catering services 19.1%, and tourism 57.6%.

In the four months, retail sales reached some 1.59 quadrillion VND, up 7.1% year-on-year (up 4.4% if the price factor is excluded).

Sales of food and foodstuffs rose by 11.8%, household appliances 14.9%, garment 10.3%, vehicles (except cars) 0.1%, and cultural and educational products 17.8%. Revenue from accommodation and catering services was estimated at 237.3 trillion VND, up 15.3% year-on-year.

The office said favourable visa policies and tourism stimulus programmes have proven effective, helping lure nearly 1.6 million international visitors in April, up 58.2% year-on-year, and 6.2 million in the four months, up 68.3%.

Tourism revenue in the period was 19.4 trillion VND, representing an increase of 49.3% from the corresponding time last year.

Meanwhile, revenue from other services stood at 211.1 trillion VND, a year-on-year rise of 9.4%.

To ensure the supply of essential goods and boost the domestic market in the remaining months, the GSO suggested the Ministry of Industry and Trade (MoIT) further review, amend and perfect legal documents regarding state management of the domestic market.

The MoIT should continue its coordination with other ministries, agencies and localities in monitoring market developments, and providing consultations in price management, it said.

In an effort to promote consumption demand, Minister of Finance Ho Duc Phoc, authorised by the Prime Minister, submitted a proposal to the National Assembly for extending the cut in value-added tax (VAT) from 10% to 8% on specific groups of goods and services from July 1 until the end of the year./.

PM sets major goals for banking sector in digital transformation

Prime Minister Pham Minh Chinh has set three major digital transformation targets for the banking sector, including creating the most favourable conditions for people, businesses and agencies to access banking services.

At an event on digital transformation in the banking industry held by the State Bank of Vietnam (SBV) in Hanoi on May 8, the PM said digital transformation should contribute to reducing time and compliance cost for people, businesses and agencies and the banking system itself, while helping control risks and prevent corruption.

The Government leader requested the banking sector to focus on strengthening the perfection of institutions and mechanisms, creating a full legal corridor for the development, expansion and diversification of modern banking services meeting international standards, and promoting the development of the digital banking ecosystem, meeting the growing requirements of the economy.

Alongside, it is necessary to boost electronic payment infrastructure, diversifying banking products and services, creating an important foundation for the development of the digital banking ecosystem and digital economy, while speeding up digital transformation to support banking inspection and supervision, thus enhancing publicity, transparency, and preventing corruption and money laundering.

At the same time, the PM also underlined the need to develop digital human resources in the banking industry, especially high-quality human resources to meet the development needs of the industry and international cooperation activities, along with the enhancement of security and safety in payment, protection of personal data and application of new security standards, ensuring fast, safe, convenient payment at reasonable cost.

PM Chinh emphasised that the banking sector should effectively implement tasks and solutions stated in the national digital transformation strategy, the strategy for banking sector’s development, the digital transformation plan in the banking industry, and Directive 18 on strengthening data connections and sharing serving the development of e-commerce, preventing tax loss and ensuring monetary security.

According to the SBV, after three years of implementing the digital transformation plan for the banking sector until 2025 with a vision to 2030, the sector has reaped fruitful results.

To date, more than 87% of adults have payment accounts at banks and many banks have over 95% of transactions processed on digital channels. The average growth in the number of payment transactions via mobile devices and QR code from 2017 to 2023 reached over 100% per year.

Banking technology infrastructure has been upgraded and developed, ensuring continuous, smooth and safe operations. New digital technologies have also been strongly applied to develop new products and services, meeting the increasing needs of people and businesses. Vietnam has completed cross-border payment connections via QR codes with Thailand, Cambodia, and is connecting with Laos, and expectedly with countries inside and outside the ASEAN region, the SBV said.

The banking sector has closely coordinated with the Ministry of Public Security in crime prevention and control and in using residential data to serve customer information data cleaning, authenticating customers' identification, supporting lending activities.

To date, 58 credit institutions have been implementing applications to authenticate customers with chip-embedded ID cards via devices at the counter, and 14 credit institutions are piloting the use of the identification and authentication app (VNeID) in some of their services.

Positive results have also been seen in cashless payment activities. In the first 4 months of 2024, cashless payment transactions increased 56.57% in number and 31.35% in value, the SBV reported./.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes