Vietnam experienced terrible typhoons, storms and flooding during the month of October, especially in the central region of the country. This year’s natural disasters were terribly harsh, with many infrastructures damaged, homes lost numerous lives lost.
Despite severe consequences from flooding in Vietnam’s central region, the country’s GDP growth remains on track to expand 2 – 3% this year, according to Prime Minister Nguyen Xuan Phuc at a monthly government meeting on October 30.
The past week spotlight
Vietnam GDP growth on course to reach 3% despite severe flooding: PM
Overview of the meeting. Photo: Quang Hieu.
Vietnam’s economy moved on from its rock-bottom in the second quarter and was on the V-shaped recovery in the third one, said Mr. Phuc at a monthly government meeting on October 30.
In October, the consumer price index (CPI), the main gauge of inflation, expanded at a five-year low of 0.09% against September and last December. This resulted in an expansion of 3.71% of the index in the first ten months of this year.
Meanwhile, the country’s trade surplus reached a new height of US$18.7 billion in the ten-month period, indicating a speedy recovery of exports.
Another highlight of the economy is the disbursement rate of public funds coming at 70% during the period, the highest in the past five years and up 34.5% year-on-year.
Let’s look at some other related financial and business news during the past week:
1. VN attract US$23.48 billion in FDI in ten months: MPI
Vietnam attracted US$23.48 billion worth of FDI in the first 10 months of this year, equal to 80.6 per cent of the figure in the same period last year, the Ministry of Planning and Investment (MPI) has reported.
From January to October, 2,100 new projects have been licensed with a total registered capital of $11.66 billion, down 32.1 per cent in volume and 9.1 per cent in value year-on-year.
Just over 900 projects have increased their capital, by an additional $5.71 billion, down 20.8 per cent in project numbers but up 4.4 per cent in capital, the ministry said.
2. 79% Vietnamese consumers in favor of government’s initiative towards cashless society
A survey conducted by global payment technology company VISA revealed 79% of Vietnamese consumers are in favor of the government initiative focused on transforming the country into a cashless society.
Notably, the rate is the highest among Southeast Asian countries, with Indonesia came in second with 75%, and Thailand in third place with 73%.
VISA’s survey suggested Southeast Asian consumers are extremely optimistic about their future use of cashless payments. Close to seven in 10 consumers expect their usage of cashless payments to increase in the next 12 months, it added.
3. US, Japan and Australia to form supply chains in Vietnam
The governments of the US, Japan and Australia are taking steps to invest in the development of infrastructure and form supply chains in Vietnam, according to Nguyen Van Binh, head of the Party Central Committee’s Economic Commission.
Vietnam expects economic cooperation to become a major pillar in the country’s relations with the three countries on the basis of equality and mutual benefit, stated Mr. Binh in an online meeting with leaders of the Japan Bank for International Cooperation (JBIC), the US International Development Finance Corporation (DFC), and the Export Finance Australia (EFA) on October 30.
5. Vietnam trade surplus hits new record of US$18.72 billion in 10-month
Vietnam's trade turnover is likely to reach US$439.82 billion in the January – October period, a slight increase from the US$428.63 billion in the same period last year.
Vietnam earned an estimated trade surplus of US$2.2 billion in October and consequently a record surplus of US$18.72 billion in the January–October period, compared to a US$9.01 billion surplus recorded in the same period last year, the General Statistics Office (GSO) has said in a monthly report.
6. Vietnam PM dismisses deliberate devaluation of currency
A devaluation of the VND would have serious consequences on macro-economic stability, the trust of investors and the people, resulting in a big loss to the economy, Prime Minister Nguyen Xuan Phuc has said.
Vietnam’s flexible management of its monetary policy is to ensure a stable macro-economic environment and mitigates negative impacts from external shocks to the economy, not for unfair trade gains or to support any specific sectors, according to Prime Minister Nguyen Xuan Phuc.
7.Vietnam October inflation hits 5-year low at 0.09% m/m
Core inflation comes at 2.52% year-on-year in the first ten months of 2020.
Vietnam's consumer price index (CPI), the main gauge of inflation, in October edged up 0.09% against the previous month and versus the end of 2019, both at the weakest levels in the 2016 – 2020 period, according to the General Statistics Office (GSO).
8. Export revenue rises 4.7% in ten months despite COVID-19
Vietnam’s imports and exports still maintained a positive increase in the first ten months of this year, making a considerable contribution to national economic growth despite the complicated developments of the COVID-19 pandemic across the world, according to the General Statistics Office (GSO).
In the ten-month period, Vietnam posted total export revenue of US$229.27 billion, up 4.7% over the same period last year. Thirty-three types of goods reported export revenue of over US$1 billion each, accounting for 91.8% of total export revenue, including five types of goods recording revenue of over US$10 billion each, making up 59.9% of the national total.
ASEAN member states under the chair of Vietnam are beefing up efforts to fight the lingering coronavirus pandemic and prepare a recovery plan that will facilitate investment and trade inflows across the region.
Member states have just adopted an amended concept document on ASEAN’s COVID-19 response fund and a document on regional reserves of medical supplies.
Both documents will be submitted to the ASEAN Coordinating Council before being discussed at the 37th ASEAN Summit, scheduled for next month in Vietnam.
10. Taxation body missing out on taxes from sharing-economy businesses
Businesses following the sharing economy model are facing problems in tax declaration. Because of the lack of regulations, the taxation body may be taxing inaccurately or missing taxpayers.
The ministry says the current tax laws don’t differentiate between businesses following the traditional way and the businesses following a sharing economy model. The tax imposition and collection on sharing economy businesses are implemented in accordance with VAT, Corporate Income Tax and Tax Management Laws.
On 14 December 2020, the Government promulgated Decree No. 145/2020/ND-CP detailing and guiding the implementation of a number of articles of the Labor Code regarding labor conditions and labor relation (“Decree 145”). Such Decree provides for labor management, labor contract, labor outsourcing, dialogue at workplace, salary, working hour & rest hour, labor discipline & material liability, female employees & gender equality, domestic worker and labor dispute.
For the upcoming 2021, we are delighted to offer this “Compliance Calendar 2021” in English and Vietnamese with the hope to help enterprises not missing any important deadlines. The issues include periodic requirements of tax and labour compliance as stipulated in the latest legal documents. Please kindly find the bilingual calendar in the Downloads section below and let us know if you have any questions about the deadlines or would like assistance in meeting them.