Vietnam News in Brief: Weekly Roundup July 28

Posted by Written by Mark Barnes Reading Time: 3 minutes

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.

Economic news

Australian, Vietnam mining firms ink deal for rare earth extraction

Mining in Vietnam has historically been a tough nut for foreign firms to crack. Australian mining firm, Blackstone Minerals, however, seems to be making some headway. Its nickel mine in Hoa Binh, north-west of Hanoi, is progressing and it has inked a deal with another Australian firm and a Vietnamese rare earth mining firm aimed at boosting Vietnam’s extraction capacity.

See also: Rare Earth Mining in Vietnam: Industry Overview

Trade news

Israel-Vietnam sign free trade agreement

This has been in the works for a while and has finally been signed by both parties. Vietnam’s key exports to Israel are tech, textiles, and agricultural goods; whereas imports from Israel are mostly machines, computers, and fertilizer.

See also: Vietnam-Israel Trade: An Overview

Finance news

Ho Chi Minh Stock exchange hits 1,200 points

Whereas GDP growth has slowed in the last six months, the VN stock market has been bullish with the VN-index topping 1,200 points this week. This is a 20 percent jump on November’s performance when it was sitting at 911 points. Decreasing interest rates are likely a key factor but margin lending has also been on the rise, with credit now easier to access. This is in line with a push by the government and the State Bank of Vietnam to facilitate lending to stimulate the economy and hit credit growth targets.

Real estate news

Malaysian real estate firm invests in HCMC’s Thu Duc

Malaysia’s The Star is reporting that property giant Gamuda is looking to purchase Vietnam’s Tam Luc Real Estate Corporation, which owns land in Ho Chi Minh City’s Thu Duc. Gamuda has eyes on a mixed-use high-rise for the land. This acquisition is in line with other such deals in Vietnam’s stressed real estate sector, whose recovery has been compromised by a gamut of high-profile challenges over the last 12 months or so.

Read more: Vietnam’s Real Estate Market Turmoil Explained

Tax news

Tax authority’s net windfall from cross-border service providers

The General Department of Taxation has announced that it received US$166 million in taxes from foreign cross-border service providers. These were partly direct taxes but also foreign contractor tax (FCT) collected by domestic firms on behalf of foreign companies. Prior to 2022, FCT only applied to business-to-business transactions. In January of that year, however, it was extended to business-to-consumer transactions. This has seen Vietnam’s government earn millions of dollars in additional tax revenue since its implementation.

Read more: Taxes for Foreign E-commerce Firms Earning an Income in Vietnam

Investment news

South Korean firm to invest US$1 billion in southern Vietnam

Hyosung from South Korea wants to build a US$1 billion carbon fiber factory in Vietnam’s Ba Ria-Vung Tau province. Hyosung, founded in 1966, is an industrial production conglomerate with business interests in a broad range of sectors, including chemicals, machinery, information technology, and construction. According to The Investor, Hyosung has already invested US$3.5 billion in projects around Vietnam from Dong Nai in the south to Bac Ninh in the north.

See also: Vietnam’s Key Economic Zones

US firm to buy Vietnamese payroll, HR fintech startup

US firm GoLogiq has announced that it has signed an agreement to buy Vietnam’s Symplefy for US$30 million. Symplefy provides HR and payroll solutions and is one of a number of local startups to draw the interest of foreign firms. Despite some challenges in the past year or so, overall Vietnam’s startup sector has proven very effective at attracting foreign investments.

Read more: Investing in Vietnamese Startups: Quick Guide 2023

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