Vietnam News in Brief: Weekly Roundup March 3
The team at Vietnam Briefing summarizes the top business news stories from around Vietnam each week. Here’s what happened this week.
Netflix may be preparing to open a local office
Reuters is reporting that Netflix is preparing to open an office in Vietnam. This would make sense given recently enacted data protection laws will require most major cross border digital service providers to open offices in the Southeast Asian nation. They will also be required to store some data on servers inside Vietnam.
See also: How are Foreign Investors Responding to Vietnam’s New Data Localization Regulation
US$1.4 billion in FDI was received in February
This is on top of US$1.6 in January, bringing the total for the year to US$3.1 billion. This is down 38 percent year-on-year. This may be driven by a number of factors: high global inflation putting downward pressure on consumer spending, officials taking a cautious approach to greenlighting new projects to avoid getting caught up in the ongoing corruption crackdown, or it could simply be an extended hangover from the Lunar New Year break. FDI figures for March, when released, should give a clearer picture.
Industrial production bounces back in February
Vietnam’s industrial production index was up 3.6 percent in February, a positive sign for workers and manufacturers in Vietnam. These figures are also supported by S & P Global’s Purchasing Managers’ Index which gave Vietnam’s manufacturing sector a score of 51.2 up from 47.4 in January—a score above 50 means there is growth in the sector, a score below 50 means it’s contracting.
Intellectual Property News
Vietnam has moved up in International IP Index
The US Chamber of Commerce Global Innovation Policy Center has released its International IP Index 2023 and Vietnam has moved up. Vietnam came in at number 11 in IP protection in Asia beating out Thailand, Indonesia, India, and Pakistan. This is mostly attributed to revisions to the Law on Intellectual property made last year (See: IP in Vietnam: Peppa Pig Vs Wolfoo).
Vietnam is buying up foreign currencies
The Saigon Times is reporting that the State Bank of Vietnam (SBV) has been buying up US dollars since the beginning of the year. This is to replenish the country’s foreign currency reserves depleted last year as the dong struggled against rising interest rates in the US and a stronger US dollar.
According to The Saigon Times, the SBV bought US$2.78 billion in January bringing its current reserves to US$91.78 billion. This is still well below the US$110 billion in reserves it reportedly had in March of 2022.
See also: How Federal Reserve Interest Rate Hikes Affect the Vietnamese Dong
IFC to invest US$39 million in VN Agriculture
The International Finance Corporation (IFC) has signed an agreement with Vietnam’s BaF Vietnam Agriculture to provide US$39 million in investment. This will be in the form of bonds and convertible bonds and used to improve standards and biosecurity, particularly with respect to pork–African Swine Fever hit Vietnamese pork producers hard in 2019.
See also: Vietnam’s Agricultural Sector: Rising Star in Food Production
Seafood exports down 48 percent in January
The Vietnam Association of Seafood Exporters and Producers (VASEP) hsa said that seafood exports in January totalled just US$456 million, a huge drop on January a year earlier. VnExpress quoted Le Hang, the Communications Director at VASEP as attributing this to lower demand linked to a wider economic downturn.
Real Estate News
Vietnam’s industrial zones to get boost from Singapore firm
Singapore’s Frasers Property’s Vietnamese arm has announced it is partnering with domestic firm Gelex to develop ‘high-quality’ industrial zones in Vietnam to the tune of US$250 million. Frasers Property currently has interests in residential and commercial properties in Hanoi and Ho Chi Minh City as well as an industrial park in Binh Duong.
See also: Key Considerations When Choosing an Industrial Zone in Vietnam
Waste Management News
German firm to develop US$50 million recycling plant in Vietnam
Germany’s Alba Group has partnered with waste collection and recycling firm VietCycle to build a US$50 million plastic recycling plant in Vietnam. The plant should be able to process 48,000 tonnes of waste a year.
Czech Republic’s Skodas to hit the streets of Vietnam
VNExpress has reported that Skoda has partnered with local firm TC Motor to import Skodas into Vietnam. The first vehicles are expected to hit the road in Vietnam in May. The two companies are also building a factory in Quang Ninh in Northern Vietnam. This will be Skoda’s first factory in Southeast Asia.
See also: Why Investors Should Consider Vietnam’s Electric Vehicle Market
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