Vietnam News Today (Oct. 5): Vietnam - Powerful Magnet For Foreign Direct Investment

FDI is a significant driving force of Vietnam's growth (Photo: VNA)

Vietnam – powerful magnet for foreign direct investment

Vietnam has become one of the leading countries in Southeast Asia in attracting foreign direct investment (FDI), according to an article published on September 21 on the website gfmag.com of Global Finance Magazine.

The writing attributes it to a range of advantages of the country, including its favorable demographics as 40% of Vietnam’s population of 100 million are under 25. In addition, it has tariff-free access to the Southeast Asia region with 800 million people thanks to being a member of the Association of Southeast Asian Nations (ASEAN).

According to Thierry Mermet, CEO of Source Of Asia (SOA), a consultant to companies looking for business opportunities in Vietnam and ASEAN, the 2023 outlook for the business environment in Vietnam shows promising signs of improvement. He cited foreign direct investment capital reaching about US$10 billion in the first quarter of 2023, an increase of 0.5% over the same period last year. Mermet predicted that this trend will continue in the near future.

The expert said that in the long term, Vietnam is really strengthening its position as one of the top three locations where European business leaders want to invest. According to the Business Confidence Index report conducted by the European Chamber of Commerce in Vietnam (EuroCham), 3% more leaders have picked Vietnam as one of the top three investment choices.

The article said that 90 countries and territories invested in Vietnam in the first half of this year; the top five are Asian countries. with the Republic of Korea in first place, accounting for US$81 billion. It was followed by Singapore and Japan with US$72 billion and nearly US$70 billion committed, respectively. Notably, while the US stood in the 7th position in terms of investment capital, it is Vietnam’s first key export partner.

Another indicator of Vietnam’s attraction is homegrown electric vehicle (EV) manufacturer VinFast, which recently became the world’s third-largest automaker by market capitalisation, behind Tesla and Toyota, cited VNA.

According to Barry Elliott, Vice President of Tomkins Ventures and a supply chain guru long active in Vietnam, this not only signals a promising future for the EV industry in Southeast Asia in general, but also exemplifies Vietnam’s emerging prowess in manufacturing.

Meanwhile, S&P Global said that Vietnam’s robust economic growth is also a factor that helps attract foreign investors to the country. Although its economic growth slowed to 3.7% in the first half from 8% in 2022, the World Bank predicts a rebound in the second half of this year.

The S&P Global forecast an increase in mergers and acquisitions in Vietnam’s banking sector over the next two years as lenders seek to bolster their capital.

Thailand's Kasikornbank PCL is reportedly in talks to acquire consumer finance provider Home Credit Vietnam in a deal valued at about US$1 billion. If successful, this would be the second-largest deal in Vietnam in 2023, following Sumitomo Mitsui Banking Corp.'s acquisition of a 15% stake in Vietnam Prosperity Joint Stock Commercial Bank in March.

According to Mukuru Kato, managing director and head of frontier markets research at EFG Hermes Research said deals will likely surge between 2023 and 2024, including among state-owned commercial banks (SOCBs), as the State Bank of Vietnam is keen to have a Vietnamese bank rank among the top 100 in Asia.

Ivan Tan, an analyst at S&P Global Ratings, said that acquiring a strategic stake in Vietnamese banks provides an opportunity for foreign investors to participate in the growth and tap the country’s favorable demographics via retail lending, particularly via digital channels.

Typhoon KOINU unlikely to affect Vietnam’s mainland

Typhoon KOINU with winds gusting 166kph near its center has changed its course before heading for the East Sea, said the National Centre for Hydro-Meteorological Forecasting (NCHMF) on October 4 afternoon.

At 13:00hrs, KOINU was swirling around the waters southeast of Taiwan (China), packing winds of between 150 – 166kph. It was moving west at a speed of 15kph.

Typhoon KOINU is churning across the southern part of China but is unlikely to impact Vietnam.

In the next 24 and 48 hours, it is expected to travel west and north-west at a speed of 10kph and weaken before entering the East Sea.

In the next 72 and 120 hours, KOINU is forecast to move west and south-west at a speed of 5kph and continue to lose its strength.

KOINU will cause rough seas in the north-eastern part of the East Sea when it enters the regional waters, according to VOV.

Though KOINU is unlikely to impact Vietnam, relevant agencies have been required to inform vessels about the developments of the typhoon and deploy rescue forces in case of emergency.

Program helps French students gain insights into Vietnamese culture

The “Tremplin pour le Vietnam” (Springboard to Vietnam) project - a collaboration between France's Paul-Valery Montpellier III University and the University of Languages and International Studies (ULIS) - Vietnam National University, Hanoi, has affirmed its role as a bridge to connect French young people with Vietnamese culture and language.

Initiated in 2019, the university education program in Vietnamese language and culture has garnered significant interest among French young people, with 20 students enrolling in the first course.

So far, the program, operated under the special coordination of historian Pierre Journoud, a professor at Paul-Valery Montpellier III University, has trained nearly 100 students, reported VNA.

A workshop on Vietnam - France relations hosted by Paul-Valery Montpellier III University in collaboration with The “Tremplin pour le Vietnam” program (Photo: VNA)

According to Prof. Journoud, the project is strongly supported by the French university and the Vietnamese Embassy in France. Its objective is to make Vietnam more popular among young French people and even older ones as this certificate is for those aged from 18 to 78.

The program primarily focuses on education in Vietnamese history, culture, and language which serve as a common gateway to help learners understand more about Vietnam. In addition, it also covers economic, business and environmental topics, Journoud said.

In addition to in-class Vietnamese language and culture lessons, students also have chances to attend seminars or symposiums and engage in extracurricular activities to gain a deeper understanding of the Vietnamese community's presence in France.

The project is expected to contribute to further boosting the French–Vietnam cooperation, he added.

Holtzer Gérard, one of the oldest students in the program, shared that he is especially interested in the program.

“I enrol in the program not only to learn the Vietnamese language but also to learn about history and sociology,” he said.

According to Dam Minh Thuy, head of the Faculty of French Language and Culture under ULIS, this program provides young French people with an opportunity to learn more about Vietnamese culture, and offeres a valuable chance for Vietnamese French people to connect with their homeland.

Vietnam and Myanmar seek to boost trade-investment cooperation

A Myanmar-Vietnam trade fair is scheduled to take place in Yangon, Myanmar on November 1 to attract 22 booths displaying a range of Vietnamese products.

Simultaneously, a Vietnam-Myanmar trade workshop will be held to draw the participation of various representatives of craft associations and businesses of the two countries.

The events to be co-organized by the Vietnam Trade Office in Myanmar and the Myanmar Entrepreneurs' Association aim to boost trade and investment cooperation between the two countries.

According to the General Department of Vietnam Customs, two-way trade between Vietnam and Myanmar fetched US$489 million between Jan. and Aug, 2023, marking a reduction by 17% compared to the same period last year.

Of the total value, Vietnam exported over US$311 million worth of goods to the market, down by 15%, while its imports were valued at US$178 million, down 20% year on year.

The fall in Vietnamese exports to Myanmar is mainly due to the recent increase in import restrictions by the Myanmar side, cited VOV.

Photo: VOV

Moreover, the majority of goods exported to Myanmar require licenses, except for some agricultural machinery and equipment. The time to apply for a license to import goods by sea takes about three and a half months, whilst by road it is about four to six days.

The Vietnam Trade Office in Myanmar says that it will continue to work closely with Myanmar's associations, distributors, contractors, supermarkets, and other businesses to push connections between the two countries’ business communities.

It will also organize trade exchanges, encourage Vietnamese business delegations to Myanmar to seek trade and investment opportunities and hold trade fairs there.

Vietnam highlights need for int’l cooperation in ensuring gender equality: Diplomat to UN

It is necessary to promote international cooperation to support countries in implementing international commitments to ensure the full, equal, and meaningful participation of women and girls in all areas of social life, contributing to preventing violence and discrimination, Minister Counsellor Le Thi Minh Thoa, Deputy Permanent Representative of Vietnam to the United Nations (UN) has stated.

On October 3, Minister Counsellor Thoa made the remark at a meeting of the UN Committee on Social, Humanitarian, and Cultural Issues of the 78th-tenure UN General Assembly.

The diplomat held that women in many parts of the world are facing problems such as health, loss or reduction of income, lagging behind in access to knowledge, employment opportunities, and integration, and becoming victims of gender-based violence. Meanwhile, digital transformation and global economic trends, on the one hand, are both solutions and, on the other hand, pose the risk of exacerbating women's vulnerabilities, she stressed.

Vietnam highlights need for int’l cooperation in ensuring gender equality: Minister Counsellor Le Thi Minh Thoa, Deputy Permanent Representative of Vietnam to the United Nations (UN) addresses the event. (Photo: MOFA)

The Vietnamese representative underlined that in the context of digital transformation, it is crucial to focus on improving digital skills of female workers and promoting the role of women in developing the digital economy. In addition, it is necessary to create favorable conditions for women and girls to develop their careers in science and technology, and protect women's rights in the digital environment.

On the occasion, Minister Counsellor Thoa highlighted achievements that Vietnam has gained in ensuring the rights of women and gender equality in the process of policy making, law building and development strategy designing.

Notably, Vietnam has a high ratio of women among National Assembly deputies and leaders, he said, adding that the country has shown strong performance in ensuring employment for women as well as gender equality in the digital era, WVR reported.

Vietnam will continue to cooperate with the international community in promoting gender equality and progress of women, the diplomat affirmed.

At the meeting, the majority of countries said that signs of regression have been seen in the promotion of the role and participation of women in all fields of social life. Women are still largely affected by today's intertwined and multi-dimensional crises, they noted.

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