News Bulletin 25 - Week 1 August, 2020

With Danang in lockdown and a return of Covid-19 community transmission, there is a sense of worry and concern about the pandemic’s renewed negative impact on the business community in Vietnam. Regarding the EU-Vietnam Free Trade Agreement (EVFTA), last week, on August 6, 2020 at a video conference in Hanoi, Minister of Planning and Investment Nguyen Chi Dung submitted an action plan of four groups of solutions to ensure the smooth implementation of the EU-Vietnam Free Trade Agreement (EVFTA).

The past week spotlight

MPI proposes four groups of solutions for EVFTA implementation

Photo: The Minister of Planning and Investment outlining the solutions to implement the EVFTA

The Minister of Planning and Investment laid out the action plan at a video conference on August 6 to ensure the smooth implementation of the EVFTA and that both sides can maximise benefits from the agreement.

The minister outlined four groups of solutions. Notably, the first solution group would increase the organisation of investment promotion programmes and conferences to disseminate Vietnam’s commitment to local authorities and the business community.

The investment promotion programmes would aim to increase the awarness of foreign investors, particularly EU enterprises about Vietnam’s commitments to open its market and liberalise investment.

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Let’s look at some other related financial and business news during the past week:

1. Wide impacts to be made with new law changes

Effective in 2021, the amended laws on Enterprises, Investment, and Public-Private Partnership are expected to entail breakthrough changes to Vietnam’s business and investment landscape in the coming time, notably amid the entry into force  of the landmark EU-Vietnam Free Trade Agreement. Tran Hao Hung, director of the Legal Department under the Ministry of Planning and Investment shines light on the fresh changes in the laws and their impacts on the country’s investment picture.

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2. Nikkei Asian Review: Samsung Electronics looks to shift production to VN

Samsung Electronics ends personal computer production in China as it looks to shift production to Viet Nam to cut costs and remain competitive in the PC business, according to the Nikkei Asian Review.

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3. Southeast Asian companies to accelerate IPO plans

Southeast Asian tech and consumer durables companies are mulling over applying for IPO in 2020 while startups in Vietnam are looking at choppy waters.

In Malaysia, home improvement retailer Mr DIY has re-started the process for its up to $500 million IPO on the back of business recovery, according to Reuters.

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4. Maximum $130,700 fine for listing violations: Draft decree

Public companies may receive a penalty of VND2-3 billion ($87,120-$130,700) for falsifying share listing and trading documents under a proposal from the Ministry of Finance.

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5. Vietnam receives positive view in global exports as EVFTA takes effect: report

Vietnam is expected to continue growing its share of global exports despite decline amid the resurgence in the COVID-19 pandemic after three months of no local transmissions, according to an HSBC report.

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6. Corporate income tax reduction comes into effect

Resolution 116/2020/QH14 granting a reduction of 30 per cent on corporate income tax (CIT) for eligible enterprises officially came into effect on Monday.

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7. Wooden plank exporters struggle with higher tax rates

The Vietnam Timber and Forest Product Association has sent an urgent petition to the Ministry of Finance, Ministry of Agriculture and Rural Development and Ministry of Industry and Trade about congestion of wooden planks set for export at ports.

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8. Second Covid-19 wave could sink local businesses

Many firms have been caught off guard by the sudden spike in new Covid-19 cases, disrupting plans adjusted after the pandemic’s initial impacts.

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9. China no longer top clothes exporter to US as Vietnam gains market share

US apparel imports from China, by value, dropped from almost 30 per cent in 2019 to 20 per cent in the first half of 2020, now on par with Vietnam after the Southeast Asian nation improved its market share from 16 per cent over the same period, according to the US Department of Commerce.

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