News Bulletin 80 - Week 2, September 2021

Vietnam’s self-declared deadline to “control” Covid-19 by 15 September will probably not be possible as HCMC government officials have asked for more time to wrest the Covid-19 under control. Business chambers met with the city’s government officials to discuss the roadmap for the city’s reopening. Meanwhile in Hanoi the lockdown continued and restrictions will probably not ease for another couple of weeks.

Although there is tremendous pressure for the government to reopen the economy, many are concerned that vaccination rate is still not high enough to warrant easing of measures.  Reopening the economy is necessary but any untimely decision amid low vaccination rates and high contagion risks could stymie the country’s efforts to defeat Covid-19, experts warn.  "The premature lifting of the lockdown and reopening the economy while the full vaccination rate remains low, new infections and fatality rates are still soaring and the health system is overburdened may even endanger the economy and people’s lives more badly," Nguyen Minh Cuong, principal country economist at the Asian Development Bank said.

The past week highlight:

Vietnam’s Anti-Virus Rules Rile Exporters as Supply Chains Hit

Vietnam’s tough anti-virus policies, which have shuttered factories and stunted output, are drawing fire from both overseas industries and within the government as a threat to the nation’s exports and future investments.
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Vietnam’s tough anti-virus policies, which have shuttered factories and stunted output, are drawing fire from both overseas industries and within the government as a threat to the nation’s exports and future investments.

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

1. "Green Pass" pilot proposal to restore tourism activities

The Vietnam Tourism Advisory Board (TAB) research team has just proposed issuing a "Green Pass" to support the resumption of economic and tourism activities amid the COVID-19 pandemic.

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2. HCMC: total retail sales of goods decrease by nearly 16 percent

According to the Department of Industry and Trade of Ho Chi Minh City, from August 23 to now, the city has continued to strengthen social distancing following the motto of “staying put wherever you are”, trade activities of goods, food, and foodstuffs in the area encountered many difficulties at first, especially in the supply and distribution activities of food and foodstuffs to citizens.

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3. Vietnamese keen on cryptocurrencies: surveys

According to a survey by Chainalysis, Vietnam's cryptocurrency market has grown by 881 percent year-on-year, ranking first out of 154 countries in the "Global Cryptocurrency Adoption Index 2021" ranking.

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4. Vietnam remains favoured destination for foreign investment despite COVID-19: Australian newspaper

Vietnam is likely to remain foreign investors’ favoured destination despite the COVID-19 resurgence ravaging across the country, The Australia Financial Review (ARF) said in a story published earlier this week.

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5. August's CPI inches up 0.25 percent

Vietnam's consumer price index (CPI) in August was 0.25 percent against the previous month, according to the General Statistics Office (GSO).

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6. HCMC's street food stores not ready for reopening

Few convenience stores have reopened while most of food and drink stores in HCMC are still close after the city’s allowance for the resumption of a small number of food and essentials goods delivery services starting on September 8.

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7. Experts warn of risks to premature economic reopening

Reopening the economy is necessary but any untimely decision amid low vaccination rates and high contagion risks could stymie the country’s efforts to defeat Covid-19, experts warn.

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8. FDI decline slows down

Foreign direct investment pledges downed 2.1 percent year-on-year in the first eight months to $19.12 billion, according to the Ministry of Planning and Investment.

The decline has slowed down compared the decrease of 11 percent in the first seven months.

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9. Commercial banks sharply raise provisions to cover bad debts

Although commercial banks have restructured a lot of debts to support customers affected by the Covid-19 pandemic, in the recently released second-quarter financial statements of commercial banks, the total bad debts by June 30 still increased by 4.5 percent compared to the end of last year, equivalent to an increase of nearly VND124.9 trillion. In which, the ratio of debt group 5 (Potentially irrecoverable debts) at some commercial banks has recently increased rapidly.

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10. Vietnam prepares to welcome vaccinated foreign tourists to Phu Quoc

Vietnam’s Ministry of Culture, Sports, and Tourism has proposed that Phu Quoc Island, off the southern coast, welcome international visitors with ‘vaccine passports’ in October.

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