Industry and trade developments reported on 19 December 2019
A. Market Management and Price Stabilisation
- Pork Price Crisis and Government Response
- Deputy Prime Minister Vương Đình Huệ officially criticised the Ministry of Agriculture and Rural Development (MARD) for its delay in reporting and handling the surge in pork prices.
- MARD has been held responsible for the current pork shortage and is required to urgently implement price stabilisation measures for the year-end period.
- Pork prices have reached record highs, with live hog prices hitting 90,000 VND/kg and some retail cuts (pork ribs) priced at 280,000 VND/kg in Ho Chi Minh City.
- Other protein sources, such as beef, chicken, and dog meat, have seen price increases of 10–20% following the pork price “fever”.
- Lunar New Year (Tết) Preparations
- The total value of goods prepared for the Tết holiday in Hanoi is estimated at 31.2 trillion VND, a 10% increase compared to 2019.
- To ensure supply and stabilise prices, the Ministry of Finance has proposed reducing import taxes on pork and chicken from the United States.
B. Energy Sector and Electricity Planning
- Power Supply Outlook for 2020
- The Ministry of Industry and Trade (MoIT) announced the 2018 electricity production cost audit for EVN and noted that supplying power in 2020 will be challenging due to fuel shortages (coal and gas) and unfavourable hydrology.
- Officials expressed that power outages are “unacceptable” for economic development, though historical shortages in 2009–2010 highlight the difficulty of the task.
- Renewable Energy Policy Shifts
- MoIT has requested provincial authorities and EVN to temporarily stop proposing new solar power projects under the fixed Feed-in Tariff (FIT) mechanism until new guidelines are issued.
- The World Bank and the Global Infrastructure Facility (GIF) have approved $1.5 million to support Vietnam in implementing a pilot program for solar energy auctions.
- Fossil Fuels and Heavy Industry
- Global oil markets face a potential oversupply risk in 2020 despite OPEC+ production cuts, as non-OPEC production (USA, Brazil, Norway) continues to rise.
- Vinacomin (TKV) is in a 90-day production sprint, with Cọc Sáu Coal aiming to complete its target of 2.7 million tons of raw coal for 2019.
C. International Trade and Trade Defense
- Steel Industry Risks
- The US Department of Commerce (DOC) issued a final ruling that certain steel products from Vietnam (using materials from South Korea and Taiwan) circumvented anti-dumping and anti-subsidy duties.
- Vietnamese steel faces tax rates as high as 456%; MoIT is requesting the US to allow businesses to self-certify the origin of raw materials to protect legitimate domestic production.
- Export Achievements and Challenges
- Total export turnover for the first 11 months of 2019 reached $241.7 billion, an increase of 7.9%.
- Rice exports are unlikely to reach the $3 billion target due to a 13% drop in prices and reduced demand from major markets like China.
- Shrimp exports to the EU require immediate brand building to leverage the upcoming EVFTA.
D. Industrial and Corporate Developments
- Automotive and Transportation
- Tax revenue from imported cars and crude oil reached 46.08 trillion VND in the first 11 months, a significant increase of 21.6 trillion VND over 2018.
- Total car imports reached 135,230 units by late November, contributing over $1.6 billion to the state budget.
- Large domestic auto assemblers received over 2,000 billion VND in tax refunds for imported components to encourage domestic localisation.
- Corporate Restructuring
- Vingroup is withdrawing from the retail sector by dissolving the VinPro electronics chain and merging the Adayroi e-commerce platform into VinID.
- MoIT has appointed new leadership personnel at VEAM (Vietnam Engine and Agricultural Machinery Corp) as the state prepares to hand over capital management to SCIC.
E. Digital Economy and Trade Promotion
- Combating Counterfeit Goods
- MoIT officially launched an online system for managing and resolving complaints and disputes in e-commerce at
online.gov.vn. - Ten major retail and e-commerce service providers signed a commitment to “Say No to Counterfeit Goods” to build consumer trust.
- Regional Promotion
- Hau Giang province opened an Industrial and Trade Exhibition Fair with 350 booths to promote local economic and technological achievements.
