Vietnam News in Brief: Weekly Roundup August 4
Vietnam Briefing keeps track of what’s happening in Vietnam’s business and economic news so that you don’t have to. Here’s what happened this week.
TikTok becomes number two e-commerce site in Vietnam
Selling goods via live stream was popularized during the pandemic but has stayed a strong force in e-commerce ever since. It’s understandable then that TikTok Shop has taken off in Vietnam and is now the number two e-commerce site in terms of revenue.
TikTok Shops’ strong sales also speak to the huge role social media plays in reaching Vietnamese consumers. For example, millions of dollars worth of trade is done through Facebook each year with 70 million Vietnamese small businesses using the platform. With this in mind, retailers looking to crack the Vietnamese market should put social media channels at the top of their marketing strategy.
PMI gains slightly
S&P’s PMI was up this month from 46.2 to 48.7 points. This still signals the industry is contracting; S&P points out this was a relatively modest increase compared to earlier this year and noted that it was the weakest deterioration in recent months. All in all, the manufacturing sector is not in a great place; however, it is less bad than it was.
Textile exports slide due to EU regulations: MoIT
Vietnam’s footwear and textile exports have faced recent setbacks due to EU regulations, prompting a call for more sustainable production practices. In the past seven months, Vietnam’s footwear exports have decreased by 17.1 percent and textile products decreased by 15.1 percent. The Ministry of Industry and Trade (MoIT) attributes this decline to EU regulations, particularly the EU Strategy for Sustainable and Circular Textiles, which may be impacting consumption patterns in Europe.
To address these challenges posed by EU regulations and the Carbon Border Adjustment Mechanism, there is a need for reforming the means of production in Vietnam to become less carbon-intensive. This shift towards sustainability can help mitigate the impact of such regulations on the country’s exports. Nevertheless, while addressing carbon intensity is essential, exploring alternative markets is equally crucial to maintain export growth in the face of changing consumption patterns in Europe.
US advertising firm opens office in Vietnam
Channel Factory, an advertising firm that works to connect brands with social media content, has opened a local office in Vietnam. The move comes amid a rapidly changing landscape for social media and digital advertising. There have been a number of recent attempts by the authorities to stamp out content they deem questionable. This includes penalizing brands that advertise on channels with content the government deems ‘toxic’. MMS Vietnam, for example, was fined VND 15 million (US$632) for L’Oréal advertisements on blacklisted YouTube channels back in March.
Human resources news
‘Loyalty has lost its luster’ for Vietnamese workers
Michael Page Vietnam asked 996 Vietnamese about their careers and how they felt about their current positions. The findings were in line with a trend in Vietnam whereby workers are always on the lookout for something better. It also finds they have few qualms about changing jobs, which fits with well-documented challenges in finding and retaining staff in several key regions.
Nghe An to welcome Chinese aluminum factory
Innovation Precision Vietnam is planning to build an aluminum plant in central Vietnam’s Nghe An province. The plant will have the capacity to produce 100,000 tonnes of aluminum annually and to create 1,500 high-skilled jobs. Nghe An is a popular investment destination with the Dong Nam Economic Zone and the WHA Industrial Zone being two well-established manufacturing centers here.
Intellectual property news
IP dispute sees 3,000 Vietnamese cartoons pulled from YouTube
In the latest development in an ongoing saga between Vietnamese cartoon Wolfoo and the UK’s Peppa Pig, YouTube has removed 3,000 of the former’s videos. At its heart, the dispute centers around claims by Peppa Pig’s owner Entertainment One, that Vietnam’s Sconnect, creators of Wolfoo, copied their work including storylines, sound effects, and images. That said, it has also become a test of international and domestic copyright protections as the two cartoon makers battle it out in multiple jurisdictions around the world including Russia, Vietnam, and the UK. A similar takedown last year cost Sconnect US$2 million in lost revenue, according to their own estimates.
See also: IP in Vietnam: Peppa Pig Vs Wolfoo
Show business news
Blackpink pulls off two widely acclaimed shows in Hanoi
South Korean popstars Blackpink managed to dazzle Vietnamese audiences last weekend in two widely acclaimed performances in Hanoi. This was amid doubts early last week that the concerts would even go ahead amid copyright infringement claims and controversy over a representation of the nine-dash line on the Chinese promoter’s website. Live performances from big international acts have not been common in Vietnam in the past due to restrictive administrative procedures among several other challenges.
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