BizLIVE - Prime Minister Nguyen Xuan Phuc has called on the World Bank to intensify its coordination and mobilization of capital from international donors to help Vietnam develop suitable projects. He also stated the country wants to attract more investment from the United States.
[Round-up] Vietnam PM Calls for WB’s Continued Financial Support, U.S. Financial Investment
Prime Minister Nguyen Xuan Phuc shakes hands withTymothy Geithner, president of Warburg Pincus. Photo: VGP
PM Calls for WB’s Continued Financial Support
At a meeting with WB Country Director in Vietnam Ousmane Dione in Hanoi on September 20, Prime Minister Nguyen Xuan Phuc has called on the World Bank (WB) to intensify its coordination and mobilization of capital from international donors in order to develop suitable projects that meet Vietnam’s development investment demands.
The PM suggested the bank seek grants for Vietnam, particularly non-refundable aid, in order to help agencies and localities access preferential loans after graduating from the International Development Association (IDA).
PM Urges U.S. Financial Investment in Vietnam
Vietnam wants to attract more investment from the United States, especially in finance, PM Nguyen Xuan Phuc told former U.S. Secretary of the Treasury Tymothy Geithner, who is now president of Warburg Pincus during a reception in Hanoi on September 20, the Vietnam News Agency (VNA) reported.
The PM congratulated Warburg Pincus on reaching financial investment deals with VinaCapital and affirmed that Vietnam wants major foreign investors to become strategic partners in equitized firms in the country.
Geithner said it is the right time for Warburg Pincus to increase investment in Vietnam because the government is stepping up economic and administrative reform, thus making it easier for foreign investors to expand operations in the country.
UK Eyes Bilateral Trade Deal with Vietnam
An official from the UK’s Foreign and Commonwealth Office has reaffirmed her country’s commitment to signing a bilateral trade agreement with Vietnam after it leaves the European Union. This was reflected through Prime Minister Theresa May’s appointment of Ed Vaizey as a Trade Envoy for Vietnam.
The UK wants to boost trade cooperation with Vietnam, and appreciates the country’s efforts to reform its economic structure and improve the business environment, said Director for Asia-Pacific Kate White on September 19, according to VNA.
British Firms Want to Expand Operations in HCM City
At a meeting with Politburo member and Secretary of the Ho Chi Minh City Party Committee Nguyen Thien Nhan on September 19, UK Ambassador to Vietnam Giles Lever noted that British firms want to expand operations in the city.
Nhan appreciated the ambassador’s contributions to UK-Vietnam ties, including relations between the UK and HCM City.
Denmark Willing to Aid Vietnam in Sustainable Energy Development
Denmark is willing to share its experience regarding technologies and products with Vietnam to help the country achieve goals of energy and sustainable growth, said Thomas Egebo, secretary of state of the Danish Ministry of Energy, Utilities and Climate (MEUC), at a ceremony in Hanoi on September 20 to announce the energy outlook report for Vietnam in 2017.
The report is one of the most remarkable cooperation outcomes between the Vietnamese Ministry of Industry and Trade and the MEUC within the framework of the Low-Carbon Transition in Energy Efficiency project funded by the Danish government.
Vietnam Backs GMS Economic Cooperation Program
The Vietnamese Government is committed to strongly supporting the Greater Mekong Sub-region (GMS) Economic Cooperation Program initiative, Minister of Planning and Investment Nguyen Chi Dung was quoted by VNA as saying.
Speaking at the 22nd Ministerial Meeting on the GMS Program in Hanoi on September 20, the minister said Vietnam is mobilizing capital resources from international organizations, both bilaterally and multilaterally, to materialize high-priority projects to which Vietnam is a participant by integrating the GMS’s priority programs and projects into programs funded by foreign donors.
SBV to Rate Local Credit Institutions
The State Bank of Vietnam (SBV), the country’s central bank, is planning to rank credit institutions, but it will not publicize the ranking results due to the delicacy of the issue.
The institutions will be classified in five groups - A, B, C, D and E - with A representing the best performing and E the worst. The classification will be made based on quantitative and qualitative criteria.
Vietnamese Firms Spend Less on R&D
Innovation was critical for the growth of factory productivity, but Vietnamese firms spent less on research and development (R&D) than in most other Southeast Asian countries, according to a recent World Bank report.
“While  a  substantial  proportion  of  firms  declare  spending  on  R&D,  the  average amount spent as a proportion of sales is lower than in most other  Southeast Asian countries," the report said. "Relatively few firms in Vietnam invest in licensed or patented knowledge to support their innovation efforts.”
Aeon to Soon Open Mall in Hai Phong
Aeon Vietnam’s $180-million shopping center in the northern port city of Hai Phong is expected to begin operation by 2020 and welcome about 13 million customers each year, said General Director of the company Iwamura Yasutsugu.
He made the statement during a ceremony in Hai Phong on September 20 to sign a memorandum of understanding with the Hai Phong Center for Investment, Trade and Tourism Promotion, and a local company to accelerate the construction of the shopping mall.
Mercedes-Benz Vietnam Recalls Vehicles for Power System Fault
Mercedes-Benz Vietnam is issuing a recall to the owners of 1,234 vehicles of various models in Vietnam to fix faulty power systems and the electrical connection to the electro-hydraulic power steering (EHPS).
According to the German car company, the list of vehicles includes many small-size models from the A-Class, C-Class and E-Class sedans, SUVs like the GLC, GLE, GL, and high-performance AMG models.
Vietnam Raises Petrol Prices for 5th Time YTD
Vietnam’s Ministries of Industry and Trade and Finance on Wednesday hiked domestic retail price of RON 92 petrol by 319 dong to 18,111 dong (79 U.S. cents) per liter. It is the fifth straight rise of RON 92 petrol from July 20, with a total rise value of 2,040 dong per liter.
The price of E5 bio-fuel also went up by 297 dong to 17,836 dong per liter. The prices of diesel and kerosene were up by 491 dong and 568 dong per liter, standing at 14,441 dong and 13,115 dong, respectively.
The General Department of Taxation has asked local tax authorities to enhance supervision and inspection of foreign-invested companies and those firms that have continuously posted losses but keep expanding operations.
In addition, foreign companies that run surprise losses after preferences end, and those conducting frequent transactions with affiliates in countries with low taxes will also be subjected to close watch.
Around 26,600 tons of ice cream is expected to be consumed in Vietnam this year, up 7% from 2016, translating in a daily volume of 72.8 tons. Ice cream sales are projected to increase 15% year-on-year to 3.03 trillion dong ($133.6 million), according to a Euromonitor survey.
Foreign enterprises in Vietnam are complaining of tax practices as well as the stability of the tax policy in Vietnam, said Dau Anh Tuan, head of the Legal Department under the Vietnam Chamber of Commerce and Industry (VCCI), referring to the Ministry of Finance
Tax is among major factors that influence investors’ decisions. A survey that covered 2,000 foreign-invested enterprises operating in Vietnam showed that tax incentive is one of Vietnam’s four competitive edges that also include workforce and investment policy, Tuan said at a seminar held by the Ministry of Planning and Investment in Hanoi on September 19.
A well-trained workforce and a high degree of openness to outside investment have been the major factors behind robust foreign investment in Vietnam, according to MarketWatch.
Vietnam faced economic chaos following the fall of Saigon in 1975 and the unification of the country. In 1986, the government initiated a number of far-reaching reforms after a severe economic crisis. In the 1990s, the country began increasing economic relations throughout the region and the world, including the reestablishment of trade relations with the U.S. in the 1990s and joining of the World Trade Organization in 2007.