Industry and trade news 24 December 2019

A. Petroleum and Energy Sector Policy

The Ministry of Industry and Trade (MoIT) has proposed revising the petroleum base price formula to reflect costs from both domestic production and imports more accurately.
There is a recorded need to amend Decree No. 83/2014/NĐ-CP to include petroleum products derived from waste recycling under official state management.
The MoIT suggests reclassifying “focal point” enterprises into two distinct categories: trading entities and production entities, reflecting that domestic production now satisfies 70–75% of market demand.

To reduce the cost of biofuel, the Ministry of Finance is considering a reduction in import taxes for ethanol.

OPEC+ is considering easing production cuts in early 2020, which has influenced global price stability despite optimism regarding US-China trade agreements,.
Global oil prices recently saw a slight decrease but remain near three-month highs.

B. Infrastructure and Energy Challenges

The national power grid faces significant challenges as the transmission infrastructure remains inadequate to support a projected double-digit growth in energy demand.
Total electricity production in 2019 reached approximately 209,465.9 million kWh, a 9.5% increase year-on-year.

Ensuring electricity for production and daily life in 2020 remains difficult due to unfavorable hydrology for hydropower and gas supplies meeting only 53% of designed capacity,.
Coal-fired plants are being pushed to their limits to compensate for these shortfalls.
Cà Mau province has proposed adding two new gas power projects to the national master plan for 2021–2030 to bolster supply.

Hundreds of trillions of VND remain “frozen” in major projects that are suspended or progressing slowly due to institutional bottlenecks, causing significant economic waste,.

C. Industrial and Corporate Developments

Car imports fell by 29.6% in November 2019, with Indonesia surpassing Thailand as the leading volume exporter to Vietnam,.
Vingroup has requested government support regarding taxes and fees to facilitate the production of electric vehicles.
Quality control remains a priority, with over 30 overseas auto-component facilities failing to meet quality assurance standards in 2019.

The Hoa Phat – Dung Quat complex is highlighted as a strategic project to secure the company’s position as a leading steel producer in Southeast Asia.
Nam Kim Steel confirmed that its exports to the US continue as normal, having proven the origin of its materials following Department of Commerce (DOC) tax rulings.

PV Coating: Reported 2019 revenue at 121% and profit at 262% of their annual targets.
PV Power: Completed its annual production plan 14 days ahead of schedule.
Vietsovpetro: Has set a revenue target of $1.38 billion for 2020, with a planned state budget contribution of $733.4 million.

D. Market Management and Price Stabilisation

The Prime Minister has ordered strict penalties for “price gouging” or spreading false rumours regarding pork shortages, asserting that the current supply of 25 million pigs is sufficient,.
Retailers in Ho Chi Minh City are increasing supplies and maintaining stable prices for the Lunar New Year to combat “price fever”.
Rising pork prices have caused a knock-on effect, increasing the cost of processed goods like sausages and hams by up to 50,000 VND/kg,.

The MoIT is intensifying inspections of functional food advertisements to prevent false claims, particularly in multi-level marketing and e-commerce.
Ho Chi Minh City is hosting a major consumer promotion fair with discounts of up to 45% to stimulate year-end demand.

E. International Integration and Trade Promotion

Vietnam and South Korea are striving to reach a bilateral trade turnover of $100 billion by 2020.
The Prime Minister emphasised that the agricultural sector must target $43 billion in exports for 2020, aiming to lead ASEAN and enter the global top 10.

The “Vietnamese People Prioritize Vietnamese Goods” campaign has shown success in provinces like Quảng Nam.
However, challenges remain in rural areas where local government indifference has occasionally hindered the distribution of high-quality Vietnamese products.

F. Governance and Technology Adoption

The government is prioritising the integration of departmental services into the National Public Service Portal.
A new inter-ministerial regulation involving eight ministries has been established to strictly manage the import of scrap materials.

The MoIT is actively supporting businesses in adopting smart manufacturing technologies and improving productivity through national quality programmes.