Vietnam Industry and Trade News Bulletin for JULY 28, 2023

A. POSITIVE ECONOMIC NEWS

1. Hydropower Recovery

• Full Capacity Operations: Due to increased water levels from upstream, major plants like Hoa Binh and Ban Ve can now operate at 100% capacity, ending the period of restricted generation.

2. Trade Promotion

• Viet-Lao Expo 2023: Opened in Vientiane with 250 booths. The Vietnamese section includes 120 booths showcasing pharmaceuticals, medical equipment, agriculture, textiles, and handicrafts.

B. GENERAL ECONOMIC NEWS

1. Investment and Tax Policies

• Global Minimum Tax Support: The Ministry of Planning and Investment is proposing a pilot resolution to support investors through cash payments or tax offsets to maintain competitiveness when the global minimum tax is applied.

• FDI Growth: Foreign investment reached $16.24 billion in the first 7 months (up 4.5%). Small and medium projects (under $1 million) account for nearly 70% of new projects, showing continued investor trust.

2. Regional and National Programs

• Northern Industry & Trade Conference: Discussed growth in 28 provinces. Key highlights include Hanoi’s GRDP growth (8.89%) and Quang Ninh (10.28%) in 2022, alongside efforts to leverage regional mineral and maritime resources.

• Vietnam Grand Sale 2023: A national concentrated promotion program scheduled from December 4, 2023, to January 10, 2024, combining traditional and e-commerce platforms.

3. Infrastructure and Finance Challenges

• Social Housing Credit: The 120 trillion VND package remains slow, with only 10% of funds eligible for disbursement due to strict lending conditions for both developers and low-income buyers.

• Mekong Delta Water Shortage: Experts warn of a “dry flood” season caused by El Nino and upstream dam storage, leading to severe livelihood impacts and future saltwater intrusion.

• Quang Nam Infrastructure: The province proposed a 2,700 billion VND public investment to upgrade National Highway 14D after BOT investment plans were deemed legally unfeasible.

C. INDUSTRY AND TRADE NEWS

I. ENERGY

• BOT Power Surplus: High fuel prices for imported coal have disrupted the mobilization order, leading to lower-than-committed output for some BOT thermal power plants.

• Hydropower Reservoir Status: Water levels in Northern and Central reservoirs slightly decreased, while the Central Highlands and Southeast regions saw slight increases.

• Kon Tum Hydropower: 11 small hydropower plants requested to operate above their design capacity, but the power sector notes this currently conflicts with existing purchase agreements and licenses.

II. IMPORT AND EXPORT

• Wood and Forest Products: Exports reached $6.42 billion in the first 7 months, achieving only 36% of the annual target of $18 billion.

• Rice Exports: While demand is high, experts urge a balance between seizing export opportunities and ensuring national food security.

• Logistics Exhibition: The first Vietnam International Logistics Exhibition (VILOG 2023) will feature 345 booths from 22 countries, focusing on green logistics and smart technology.

III. INTERNATIONAL INTEGRATION

• Diplomatic Missions:

    ◦ Minister Nguyen Hong Dien participated in high-level meetings in Egypt to boost bilateral cooperation.

    ◦ MoIT worked with the Governor of Wakayama (Japan) to implement industrial and trade MOUs.

• VIFTA Agreement: A review of the 7-year journey to sign the Vietnam-Israel Free Trade Agreement, the first FTA between Vietnam and a West Asian country.

D. COMPETITION, MARKET MANAGEMENT, AND M&A

1. Consumer Protection

• Anti-Counterfeiting: MoIT promotes QR Code authentication (Truyxuat.gov.vn) to help businesses and consumers verify genuine products.

• Multi-level Marketing (MLM): 14 enterprises are officially confirmed to operate MLM activities in Hai Duong, primarily dealing in functional foods and cosmetics.

2. Real Estate and M&A Trends

• Sector Leadership: Industrial real estate led M&A value in early 2023 (46% share).

• Major Foreign Deals:

    ◦ Gamuda Land (Malaysia) acquired Tam Luc Real Estate for $316 million.

    ◦ Keppel Land (Singapore) invested in residential projects and retail assets in Hanoi and HCMC.

    ◦ Hoiana Resort (Quang Nam) saw a shift in control to the Cheng family (Hong Kong).

3. International Tech Disputes

• Microsoft Antitrust: The EU opened an investigation into the bundling of Teams with the Office suite.

• Google Patent Lawsuit: A US jury ordered Google to pay $338.7 million for violating Touchstream Technologies’ patents related to video casting technology (Chromecast).