Economy & Trade

Top Vietnamese Official Talks about EU Trade Relationship

Sept. 3 –At a recent EuroCham event, Vietnamese Deputy Prime Minister Hoang Trung Hai spoke of the future of the EU-Vietnam trade and the role of the European private sector in the nation’s continuing development.

He cited the growing trade relationship between the EU and Vietnam in the past last ten years with two-way trade turnover estimated at US$12 billion for 2008. This figure makes the EU, Vietnam’s largest trade partner.

The union is also the second biggest FDI source of Vietnam with around US$9 billion and more 750 projects which contribute much to the development of Vietnam economy. So far, its committed ODA for 2008 amounts to US$962 million.

Vietnam Marks 63rd Year of Independence

By Chua Siew Joo

Sept. 2 – Vietnam celebrated its independence today, with rallies and parties throughout the country. Governement leaders paid tribute to President Ho Chi Minh at his mausoleum and laid wreath at the Monument to Fallen Soldiers

Ho Chi Minh declared Vietnam independent on the second of September in 1945, after nearly 60 years of French colonial rule. The country however, only achieved a peaceful state of development after the Cambodian settlement of October 1991.

Ericsson and Hanoi Telecom Sign Largest Network Modernization Contract in Vietnam

Sept. 1 – Ericsson signed the largest single contract in Vietnam—amounting to US$450 million—to develop and modernize Hanoi Telecom's nationwide mobile network today an industry journal reported.

The strategic partnership will also see Ericsson managing and operating the network under a full-scope managed services contract. Under the three-year managed services agreement, Ericsson will be responsible for the management, operation and network design of Hanoi Telecom's mobile network, including field operations and support services. Ericsson will also provide a comprehensive range of professional services, such as network deployment and systems integration.

Vietnamese Consumers Shift to Foreign Goods as Income Improves

Aug. 29 – The sales of local Vietnamese products have dipped by five percent year on year despite inflation while the sales of imported goods have risen by as much as 20 to 30 percent.

As living standards improve, Vietnamese are now willing to pay a premium for imported products that are better designed and packaged.

In June 2008, United States consulting company, A.T. Kearney ranked Vietnam as the the most attractive retail investment market in the world, unseating India from the top spot a year earlier

"Despite slowing economies in developed countries, the retail opportunity in emerging economies is more compelling than ever as less than 10 percent of the retail market in these countries is organized," said Hana Ben-Shabat, a partner with A.T. Kearney in a statement. "These markets will provide the engines for continued growth and profits for global retailers as sales in their home countries turn sluggish."

Vietnam Cuts Gas Prices for Second Time in a Row

Aug. 28 – Vietnam decreased fuel prices for the second time in a row this month. Gasoline prices will be cut from VND18,000 to VND17,000 a liter while kerosene from VND19,000 to VND18,000.

On August 14, the government cut the price of 92-RON gasoline by VND1,000 a liter in response to dropping world crude prices. Compared to a record US$147.27 a barrel last July 11, crude oil futures have dropped by 21 percent.

Flooding Threatens Countries along Mekong River

By Chua Siew Joo

Aug. 27 – According to the Integrated Regional Information Networks (IRIN), residents and environmentalists in Thailand have expressed suspicions that dams in China and destruction of small Mekong river islands to clear passage for Chinese cargo ships have contributed to severe flooding in the Mekong basin countries.

This year, Thailand experienced its worst flood in 100 years, causing an estimated damage of THB223 million. Large areas of Laos, Cambodia and Vietnam were also inundated.

The Mekong River Commission (MRC), established by Cambodia, Laos, Thailand and Vietnam in 1995, has since issued a statement in August accruing the abnormally high water runoff in the northern part of the Mekong basin following heavy rainfall to the tropical storm Kammuri.

Vietnam to Pass New Telecom Law

Aug. 26 – The government will soon pass the country’s first telecom law that will allow telecom operators to buy or re-sell licenses to other companies.

According to the current draft of the telecommunications law, each license purchase must be approved by the Ministry of Information and Communications (MIC) to ensure competition among operators and allow foreign investors to easily enter the market.

The license buyer must take all rights and duties of the seller. “Current regulations ban telecom license purchasing, while almost nations in the world allow this to happen”, said an MIC source.

Indian Firm to Build US$50 Million Hydropower Plant in Vietnam

Aug. 21 – Indian power equipment company, Bharat Heavy Electricals Limited (BHEL) has bagged a US$50 million contract to build a 200-megawatt (MW) hydroelectric power plant in Vietnam.

The Nam Chien Hydro Power project aims to meet the country’s growing energy demand and join its rapidly growing power sector that is expected to expand by 16 percent annually. The project will be financed through a US$45 million line of credit given by the Indian government and managed by the Export Import Bank of India.

Vietnam to Speed Up Development of Rural Areas

Aug. 19 – The Communist Party of Vietnam Central Committee has approved a resolution that will speed up development in its agricultural, forestry and fishery sector with target annual growths of 3 to 3.5 percent by 2010.

The resolution hopes to increase rural incomes by 2.5 times and incorporate rural laborers to account for 30 percent of the country’s total workforce by 2020.

The government plans to have more than 50 percent of the workforce to undergo training. It assured that despite the planned rural development, Vietnam will still maintain its capacity for rice production to ensure national food security.

Vietnam Reduces Fuel Prices By Up to 5.3%

Aug. 15 – Vietnam has reduced the price of gas by up to 5.3 percent beginning today. The new prices reflect the drop in world oil prices of more than 20 percent from July.

"The government has ordered us to reduce prices following world price declines," a Petrolimex official told Thanh Nien News.