Prime Minister Pham Minh Chinh (L) and Indonesian President Joko Widodo. (Photo: VNA)

Vietnam, Indonesia eye stronger economic, trade ties

Prime Minister Pham Minh Chinh and Indonesian President Joko Widodo co-chaired a high-level business dialogue in Hanoi on January 13 morning as part of the latter’s state visit to Vietnam.

At their meeting one day earlier, the two leaders shared the view that economic and trade ties remain a bright spot in bilateral relations, with two-way trade reaching US$13 billion in the first 11 months of 2023, and expected to soon hit US$15 billion, and even US$18 billion by 2028.

At the dialogue, President Widodo suggested the two countries step up dialogues and high-quality cooperation to realize their common vision of becoming high-income nations by 2045.

Indonesia has opened a carbon trading exchange and is promoting the e-vehicle industry, the President said, expressing his hope that leading Vietnamese businesses will increase their investment in the country, especially in its new capital city, covering such spheres as the e-vehicle industry, aviation, tourism, real estate, science-technology, banking, finance, education, and manufacturing.

For his part, PM Chinh held that President Widodo’s visit and his opinions delivered at the dialogue will encourage enterprises to step up their cooperation and investment, cited VNA.

Pointing out that economic cooperation has yet to match the bilateral political ties as well as the two economies’ stature and the two sides' expectations, the PM called on businesses to continue their connectivity and investment in order to materialize high-level agreements between the two countries and fulfill their set targets.

He appreciated Indonesian investors in Vietnam, with many projects running successfully, noting the country is attracting investment in emerging sectors like digital economy, green economy, circular economy, knowledge-based economy and sharing economy, along with the halal industry and agriculture.

The PM also expressed his hope that Indonesian businesses will support their Vietnamese counterparts to join supply chains in Indonesia and the world as well.

Vietnam always creates optimal conditions for enterprises, including those from Indonesia, to operate stably, sustainably and successfully in the country, he affirmed.

Earlier the same day, the two leaders exchanged views on issues of shared concern during their working breakfast.

Cold spell to bring rainy and chilly weather to northern Vietnam ahead of Tet

A cold spell is forecast to hit the country's northern region in the days leading up to Tet, according to predictions made by the National Hydrometeorological Forecasting Center.

The cold front is expected to begin affecting the region between January 13 and January 17 with light showers, whilst the next day will see the northern region experience sunny weather in both the morning and afternoon.

Cold spell will bring rainy and chilly weather to northern region ahead of Tet. Photo: VOV

From January 19, rain will increase in intensity and temperatures will drop as the cold snap strengthens, according to VOV.

Similarly, the central region will witness temperatures decrease and face spells of rain during this period. However, the Central Highlands and southern region will enjoy some sunny weather, with rain occurring in several areas.

Swiss media lauds Vietnam's economic, and diplomatic achievements in 2023

Swiss journalist Guy Mettan has highlighted Vietnam’s “bamboo diplomacy” and “Make in Vietnam” chip production efforts in an article published on the online newspaper bonpourlatete.com on January 12.

The article was released ahead of Vietnamese Prime Minister Pham Minh Chinh’s attendance at the 54th Annual Meeting of the World Economic Forum (WEF) in Davos, Switzerland.

The author said that in the early 2000s, he visited Vietnam many times to prepare for a book on the Geneva Accords on ending the war and restoring peace in Indochina in 1954 and was fascinated by the remarkable changes in the country since then.

According to the article, 2023 was a busy year for Vietnam with its "bamboo diplomacy" policy and efforts to become a new hub of the semiconductor industry. Taking full advantage of opportunities brought by the international situation, Vietnam increased its foreign activities and strengthened relations with its partners.

Last year, the country had a range of high-level foreign activities with other countries, including state visits to Vietnam by US President Joe Biden and Chinese President Xi Jinping, VNA reported.

A screenshot of the article on the website. (Photo: VNA)

For the first time, the Holy See has a resident papal representative in Vietnam, adding that this marked a historic moment in diplomatic relations between Vietnam and the Holy See.

The author wrote that Vietnam expects GDP growth of 6-6.5% in 2024 thanks to robust imports and exports, as well as stronger manufacturing activity.

The Southeast Asia country has an ambition to become a new center of the semiconductor industry with a series of investment projects worth billions of dollars. It targets to master 100% of the production stages of “Make in Vietnam” chips and intends to train 50,000 specialized engineers by 2030.

Vietnam is attracting more big semiconductor companies from the US, the Republic of Korea and Taiwan (China). It accounts for more than 10% of the total number of semiconductor chips imported into the US, ranking third in chip exports to the US, after Malaysia and Taiwan (China).

Carriers add 472 flights to domestic network for Lunar New Year

According to details given by the Civil Aviation Authority of Vietnam (CAAV), Vietnamese airlines have added 472 flights with more than 92,000 seats on routes between Hanoi and Ho Chi Minh City to destinations with high reservation rates to meet the increasing travel demand during the lunar New Year (Tet).

Flights from Ho Chi Minh City to various regions are showing high seat occupancies from February 1 to February 11, covering the 22nd day of the final lunar month to the second day of the first lunar month.

Air tickets for flights from other regions to Ho Chi Minh City have also nearly sold out from February 13 to February 19, immediately after the nation’s biggest and longest holiday, cited VOV.

Vietnamese airlines add 472 flights with more than 92,000 seats to meet the increasing travel demand during the Lunar New Year (Photo: VNA)

For flights from Hanoi to various destinations such as Dien Bien and Pleiku before Tet, seat occupancies exceed 88% and 90.7%, reaching 100% on the route from Hanoi to Vinh.

On major routes like Ho Chi Minh City-Da Nang, Ho Chi Minh City-Hanoi, and Hanoi-Danang, seat occupancies have been steadily increasing from February 3 to February 18. However, ticket availability remains abundant, with an average seat occupancy of 45%, a 5% to 7% increase compared to the previous week.

CAAV said that it will continue to monitor and request airlines to add more flights during the upcoming lunar New Year in a bid to meet the high demand of passengers.

Vietnam’s economy on firm recovery track: HSBC

Vietnam’s economy is on a firm recovery track, likely returning to its trend growth of 6 percent in 2024, noted HSBC in its recent report Vietnam at a glance.

According to the bank, as foreign direct investment (FDI) inflows continue to add production capacity, Vietnam's manufacturing sector is experiencing the green shoots of a rebound, bringing opportunities for its exports.

Both total and new FDI reached close to their respective historical highs in 2023, particularly with greenfield FDI jumping to a four-year high of 5 percent of GDP.

Notably, new manufacturing FDI soared to a new peak of more than US$15 billion, 80 percent of which is concentrated in the manufacturing space. This continues to put Vietnam in a leading position in ASEAN, just behind Malaysia, cited VGP.

Photo: VNN

Looking at the source of FDI, one interesting trend is worth noting. Japan and South Korea are both traditionally big investors in Vietnam, but China has been expanding its FDI footprint quickly in Vietnam.

In fact, 2023 marks the first time that mainland China has the largest share among investors, beating its two neighbors. Combined, Greater China accounted for almost half of Vietnam's new FDI inflows in 2023.

Not surprisingly, the lion's share went to electronics, a sector that Vietnam is fast becoming a rising star in. This is also an area where FDI inflows are more diversified, a reflection of Vietnam's increasing significance in the global tech supply chain.

Outside of electronics, investors are increasingly being drawn to Vietnam's promising consumer market, a trend heralded by Japanese corporates.

In terms of FDI, a key development to watch closely for in 2024 is the implementation of a minimum 15 percent corporate tax rate for multinational corporations (MNCs), effective from January 1. In Vietnam, 122 foreign companies will face a steep rise in their tax costs, which is estimated to generate revenue worth US$600 million per year.

While it is key to watch how the minimum 15 percent corporate tax rate evolves, the impact should be manageable, HSBC recommended.

Vietnam lured nearly US$36.61 billion in foreign investment in 2023, up 32.1 percent from the previous year, the Foreign Investment Agency under the Ministry of Planning and Investment revealed.

Meanwhile, total disbursed volume of FDI this year reached a new record of US$23.18 billion, up 3.5 percent from 2022.

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