Vietnam News Today (Aug. 5): Party official highlights comprehensive, rapid developments of Vietnam-US relations

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Samsung always considers Vietnam its global production "base". (Photo: baodautu.vn)

Vietnam - destination for pioneering industries

Vietnam boasts potential to attract investments in pioneering industries, and solutions are needed to materialize such opportunities, insiders have said.

Earlier this month, Foxconn Group received the green light from the northern province of Quang Ninh’s authorities to launch two projects worth 551 million USD in the locality. These projects, aimed at producing smart entertainment products and smart systems, fall within Quang Ninh’s target industries for investment in processing and manufacturing.

With these initiatives, Foxconn's total investment in Quang Ninh rises to nearly 1 billion USD and surpasses 3 billion USD in Vietnam overall. The company is involved in large-scale electronics and components projects in the northern provinces of Bac Giang and Bac Ninh, including the manufacturing of equipment and components for Apple. Last month, Foxconn also invested 383 million USD in a project at the Nam Son Hap Linh Industrial Park in Bac Ninh.

Meanwhile, the Amkor Group recently obtained an amended investment certificate to boost its investment by an additional 1.07 billion USD for its semiconductor project in Bac Ninh. This decision has propelled the total investment in the Amkor project to 1.6 billion USD, a staggering 11 years ahead of schedule. Initially, Amkor had projected to invest only 1.6 billion USD in Vietnam by 2035.

In addition to these two investors, recent reports indicate that numerous prominent technology corporations like Samsung, LG, and industry giants such as Hyosung, CJ, and Posco are gearing up to inject billions more into Vietnam in the near future, cited VNA.

During a recent meeting with Prime Minister Pham Minh Chinh as part of his official visit to the Republic of Korea, Jeong Cheol-dong, CEO of LG Display, said LG had already poured over 5 billion USD into investments in Vietnam and planned to invest an extra 3 billion USD over the next five years. As part of this expansion, the LG Innotel factory aimed to double its capacity, solidifying LG's integrated production hub in Vietnam. Jeong added that LG viewed Vietnam as its critical manufacturing hub.

Meanwhile, Samsung has long regarded Vietnam as a global manufacturing hub, having invested over 22.4 billion USD and consistently increasing its capital in recent years by an average of around 1 billion USD annually. With the opening of its Research and Development (R&D) Center in late 2022, Samsung has designated Vietnam as the group's global R&D hub - a designation that Vietnam had never anticipated.

This, however, is just the beginning, as Vietnam is increasingly becoming a focal point for global corporations in the semiconductor and AI sectors. Companies like Intel, Amkor, HanaMicron, Marvell, and Synopsys have already invested in the country and continue to do so.

Meanwhile, NVIDIA Corporation is progressively actualising its vision of making Vietnam its “second home”.

Minister of Planning and Investment (MPI) Nguyen Chi Dung recently engaged in an online discussion with NVIDIA to explore further collaboration plans.

The interest of tech giants in Vietnam is palpable. In a recent statement, the MPI highlighted that not only would numerous large-scale projects spanning semiconductors, energy (including battery production, photovoltaic cells, and silicon bars), component manufacturing, electronics, and high-value-added products see fresh investments and expanded capital in the first half of this year, but Vietnam also held promise in attracting investments across cutting-edge industries like AI, semiconductors, hydrogen, and renewable energy.

The MPI is currently finalizing a draft decree concerning the establishment, management, and utilization of the Investment Support Fund. This initiative aims to provide support from the Government to high-tech enterprises, companies engaged in producing high-tech goods, and those undertaking high-tech application projects.

According to Statista Market Insights, Vietnam is poised to experience a Compound Annual Growth Rate of 11.6% in semiconductor revenue from 2023 to 2027, reaching 31.28 billion USD by 2027. Within this projection, integrated circuits, the cornerstone of the semiconductor industry, are anticipated to hit 16.44 billion USD this year.

Google's forecast suggests that Vietnam's digital economy is set to surge eleven-fold by 2030, reaching 220 billion USD, nearly half of the country's current GDP. AI will play a pivotal role in Vietnam's realization of these forecasts, according to Marc Woo, managing director of Google Asia Pacific for Vietnam.

The forecast appears clearly optimistic. However, given the intensifying competition for investment attraction, Vietnam must act swiftly in the present landscape; otherwise, it would miss out on this unparalleled opportunity.

In a recent report to the Government, Dung highlighted the persisting challenges facing the economy, noting that emerging sectors like the digital economy, green economy, AI, chips, and semiconductors are lagging, risking Vietnam’s competitiveness on a global and regional scale.

The MPI reported that despite a steady rise in foreign investment in Vietnam, the number of large-scale projects with advanced technology remained limited. Vietnam has attracted only 108 projects exceeding 500 million USD in investment, averaging 15 projects annually, with a mere 27 falling within the high-tech sector.

“Immediate steps are required to cultivate skilled human resources, particularly in semiconductor electronics to sustain and enhance investment appeal. Simultaneously, addressing local electricity shortages in regions housing numerous electronics industry ventures is imperative. Additionally, streamlining processes to simplify and expedite post-investment registration procedures, such as obtaining construction permits and fire safety certifications, is crucial,” Dung said.

However, this is just one of the challenges. The pressure to compete for foreign investment in the high-tech sector is intensifying, with many countries, including the US, Europe, the RoK, Japan, Malaysia, Indonesia, and Thailand, requiring substantial investment support policies.

The RoK, for instance, has unveiled a 26 trillion won (approximately 19 billion USD) support initiative to bolster the chip industry. Malaysia issued the New Industrial Master Plan 2030 by the end of 2023, with an estimated scale of around 20 billion USD, aimed at revitalizing Malaysia's industries, particularly in electronics, chemicals, electric vehicles, aerospace, pharmaceuticals, medical equipment, and advanced materials. China has established a 27 billion USD semiconductor investment fund to enhance the self-sufficiency of its semiconductor industry. The US and Europe are prepared to allocate tens of billions of dollars to support investors in the semiconductor sector.

The increasing pressure asks Vietnam to ready its human resources, infrastructure, and other key elements while implementing globally competitive investment support policies to both retain current investors and entice more industry leaders.

Vietnam's National Day 2024: Workers enjoy a 4-day holiday

Workers across Vietnam will enjoy a four-day holiday for National Day 2024, from Saturday, August 31, to Tuesday, September 3.

The decision, approved by Prime Minister Pham Minh Chinh, combines the official holiday with a weekend, providing an extended break for relaxation and celebration.

Previously, Prime Minister Pham Minh Chinh approved the Ministry of Labor, Invalids, and Social Affairs' proposal for the holiday from August 31, 2024, to September 3, 2024, in celebration of National Day.

This year’s holiday includes two official days and two adjacent weekend days, offering people an extended break to relax and participate in activities commemorating this important national occasion, according to VNN.

National Day 2/9/2024 Holiday Schedule.

The Ministry of Labor, Invalids, and Social Affairs advises agencies and units to proactively arrange work to ensure continuous operations and effectively meet the public's needs during the holiday. For units that do not observe regular Saturdays and Sundays off, the holiday schedule will be flexibly adjusted according to their specific plans.

Workers outside the administrative and public service sectors will have a day off either on Sunday (September 1) or Tuesday (September 3), as decided by their employers, who must notify employees at least 30 days in advance. If the holiday coincides with a weekly day off, employees will be given a compensatory day off on the next working day.

According to the Labor Code and Government Decree 145-2020, those working on September 2 and other days during this holiday will receive higher pay than usual.

Specifically, daytime workers will earn at least 400% of their regular wages, including pay for the holiday and extra pay for working on a holiday. Nighttime workers will earn a minimum of 490% of their regular wages, encompassing overtime, night shift, and holiday pay.

Vietnam selected as partner country of IHE 2024

Vietnam was selected as partner country of the India International Hospitality Expo (IHE 2024) at the opening ceremony on August 3 in Noida, Uttar Pradesh state.

As a partner country, Vietnam arranges a booth showcasing its products and organizes a cuisine festival and masterclasses by famous Vietnamese chefs.

After the opening ceremony, the Vietnam Trade Office in India inaugurated the Vietnam booth in the presence of Indian Minister for Tourism & Culture Gajendra Singh Shekhawat and representatives of Vietnamese and Indian businesses.

The Vietnam booth has attracted much attention and appreciation from Indian and foreign businesses, cited NDO.

Indian Minister of Culture and Tourism Gajendra Singh Shekhawat (fourth, left) attends the inauguration of Vietnam's booth at IHE 2024. (Photo: VNA)

Vietnamese enterprises, including UNIBEN, Vietnam Airlines, and Vietravel, are showcasing Vietnam's typical products such as instant noodles, pho (noodle soup), coffee, tourism and aviation services, contributing to promoting the country's exports to India in particular and the world in general.

This is an important opportunity for Vietnam to promote its culture, cuisine, high-quality tourism and air services, and for Vietnamese companies to expand their trade relations and improve their presence in regional and international markets.

The four-day event is expected to attract over 1,000 exhibitors and 20,000 visitors.

Party official highlights comprehensive, rapid developments of Vietnam-US relations

Politburo member, Director of the Ho Chi Minh National Academy of Politics and Chairman of the Central Theory Council Nguyen Xuan Thang Thang highlighted the comprehensive, rapid developments of the Vietnam-US relationship during his working visit to the US from July 31 to August 4.

While in the US, Thang met with Deputy Secretary of State Kurt Campbell, Senior Advisor to the US President for International Climate Policy John Podesta, Deputy National Security Advisor for Cyber and Emerging Technology Anne Neuberger, and US Department of Treasury Deputy Assistant Secretary for Asia and the Pacific Robert Kaproth.

The Vietnamese official also had discussions with researchers and scholars at the Center for Strategic and International Studies, the Heritage Foundation, the US Institute of Peace, and the Wilson Center; held talks with representatives of the Communist Party USA; and met the staff of the Vietnamese Embassy in the country.

He used the occasion to thank the US government, agencies, partners and businesses for sending condolences to the Vietnamese Party, State and people over the passing of Party General Secretary Nguyen Phu Trong, VNA reported.

Politburo member, Director of the Ho Chi Minh National Academy of Politics and Chairman of the Central Theory Council Nguyen Xuan Thang Thang (center) and Vietnamese Ambassador to the US Nguyen Quoc Dung (left) at a meeting with Deputy Secretary of State Kurt Campbell (Photo: VNA)

Regarding the US Department of Commerce (DOC)'s announcement that it has not yet recognised Vietnam as a market economy, he said Vietnam is disappointed about the decision as over the past time, the two countries have seen unprecedented strong developments of bilateral trade and investment ties, and made great efforts in elevating their relationship to a comprehensive strategic partnership.

Vietnam has met all the six criteria set by the DOC when considering the graduation to a market economy, Thang stressed, suggesting the two sides continue enhancing exchanges.

The US should make objective evaluations, towards recognising Vietnam as a market economy, he said.

Thang also called on the US to increase its investments in potential fields in Vietnam, as well as exports to the Southeast Asian nation, saying this would help reduce the US trade deficit with Vietnam.

The US representatives shared Vietnam’s concern over the DOC’s decision and affirmed that this will not affect the thriving economic ties between the two countries.

Lashing rain let up, hot weather to soon return to north

Northern Vietnam will brace itself for a heat wave that is expected to bake the region in the coming days as soon as lashing rain stops, according to the National Center for Hydro-meteorological Forecasting.

Rain has battered the northern region for the past two weeks, causing flash floods and landslides in some localities, especially in mountainous areas.

However, the lashing rain will soon let up, giving way for hot weather to return to the northern region.

The heat wave is forecast to hit north-western localities on August 6 before gripping the whole region the following days.

Daytime temperatures are set to rise quickly, ranging from 33 to 38 degrees Celsius, cited VOV.

Hot weather is expected to return to northern Vietnam in the coming days.

The hot weather is anticipated to last for several days till August 10, said meteorologists.

Meanwhile, the central region is enduring a hot spell which is forecast to increase its intensity on August 5, with daily temperatures to stay as high as 38-39 degrees Celsius.

Meteorologists said hot weather would continue to affect the north and central regions in August, but it would no longer be too severe.

The average temperature across the country is commonly 0.5-1 degree Celsius higher than the average for many years during the same period.

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