News Bulletin 51 - Week 2 February, 2021

Vietnam is now back to normal operations after more than a week off from the annual Lunar New Year holidays (known as “Tet”). Although there continues to be reporting of new Covid19 case, Vietnam again has managed to control the latest outbreaks which started in Hai Duong province just before Tet. The good news is that the first batch of vaccines will be arriving to Vietnam in March and vaccinations will start shortly after.

There is more evidence that Vietnam is benefitting from the increased supply chain shift to Vietnam as Vietnam is now ranked among the top 10 emerging logistics markets in the world.  Japan and South Korea continue to favor Vietnam as the preferred investments location, with both countries committing to increase and expand investments into Vietnam.  Though early in the year, Vietnamese companies are reporting positive business developments through increased imports and exports, especially those in manufacturing, seafood, garment and textile. Thailand continues to invest more in Vietnam with last week’s announcement of Thai conglomerate SCG Group buying 70% stake in Vietnam’s Duy Tan Plastics.

With unprecedented situation of Covid-19 recurrence, it is notable that the Ministry of Finance has proposed an extension of tax payment and land rent to help enterprises flexibly manage their operations in the upcoming challenging time.

The past week spotlight

Ministry of Finance proposes to extend tax payment deadline in 2021

The Ministry of Finance has just proposed extending the deadline for tax payment and land rent to assist businesses in overcoming the COVID-19 pandemic.

Accordingly, the Ministry of Finance (MoF) submitted its proposals for different tax categories with expectations that state revenue would be affected due to the extensions, including: CIT, PIT, VAT and land rent.

The MoF believes this forthcoming extension plays a considerable role in supporting businesses and individuals to maintain their production and business activities, thus contributing to achieving the economic growth target for the whole year 2021.

See full details here

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

1. Decree 152 regarding foreign employees working in Vietnam

On 30 December 2020, The Government promulgated Decree No. 152/2020/ND-CP regarding foreign employees working in Vietnam (“Decree 152”). Decree 152 is effective from 15 February 2021 and replaces Decree No. 11/2016/ND-CP (as amended by Decree No. 140/2018/ND-CP).

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2. Made-in-Vietnam coronavirus vaccines likely used in May

Vietnam is developing four Covid-19 vaccines and the first human trial shows good results.

Made-in-Vietnam coronavirus vaccines might be used widely in May 2021, according to a local health expert.

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3. Vietnam growth prospects endure despite new Covid-19 outbreak: Fitch Ratings

Vietnam’s GDP growth could more than double to 7.5 percent this year despite the latest Covid-19 outbreak, a Fitch Ratings analyst told VnExpress.

She identified continued success in containing its spread and attracting foreign direct investment as a key growth spurring factor.

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4. Ministries and localities urgently tackle pressing problems for businesses

Amid the complex developments of the COVID-19 pandemic in Việt Nam, ministries and localities are urgently implementing action programmes to sustain economic growth while keeping the disease at bay.

The solutions being used, focusing on investment, exports and consumption, are in line with Government two policies – Resolution 01/NQ-CP and Resolution 02/NQ-CP issued early this year – which outlined the main tasks to implement the socio-economic development plan and the State budget estimate in 2021, as well as improve the business environment to ensure the “dual goals” of fighting the pandemic and promoting economic growth.

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5. Indonesia imposes anti-dumping tariffs on cold steel sheet from Vietnam

It is the final conclusion of an Indonesian agency for cold steel sheet imported from Vietnam.

The Indonesian Anti-dumping Committee (KADI) will impose anti-dumping tariffs on cold-rolled steel imports from Vietnam and China after a 16-month investigation, according to the Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade.

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6. Thai company to buy 70 pct of Vietnamese plastic giant

A subsidiary of Thai conglomerate SCG Group is set to buy a 70 percent stake in Vietnam’s Duy Tan Plastics.

SCG Packaging Public Company Ltd (SCGP) said in a statement the deal, whose value it did not disclose, is expected to be completed in mid-2021.

See full details here

7. Export value skyrockets over Lunar New Year

Vietnam's export turnover during this Lunar New Year saw breakthrough growth, occupying nearly half of the total export-import turnover.

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8. 57 pct of Japanese firms in Vietnam plan to expand

Vietnam is the market where the highest ratio of Japanese firms has expansion plans, 57 percent, a poll has found.

The poll by Japan’s Pasona Group Inc of Japanese companies operating in 11 countries and territories said Vietnam was followed by India (55 percent) and Thailand (50 percent).

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9. Vietnam among top three leading nations in renewable energy shift in Asia Pacific

Vietnam is among top three nations leading the shift to renewable energy in Asia Pacific, according to the latest research from IHS Markit.

Reporting on the IHS Markit’s Renewable Additions Index, the site energyvoice.com said the renewable power development pipeline has soared across the region.

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10. Vietnam ranked among world’s top 10 emerging logistics markets

Vietnam has jumped three spots to eighth in this year’s global index of emerging logistics markets after emerging as a popular manufacturing hub.

The country had an overall score of 5.67 out of 10 in the 2021 Emerging Markets Logistics Index released by leading logistics company Agility.

See full details here