Henig » February 14th, 2023
EVFTA ensures fair competition, subsidies
06:00 | 14/02/2023
(VEN) – Senior Vietnamese and European officials held a recent assessment of the initial two-year implementation of the EU-Vietnam Free Trade Agreement (EVFTA) at a meeting chaired by Minister of Industry and Trade Nguyen Hong Dien and European Commissioner for Trade Valdis Dombrovskis. Both acknowledged the efforts made by their respective monitoring agencies and enterprises in taking advantage of the trade deal’s many opportunities.
One of the most significant chapters of this new-generation agreement concerns the importance of fair competition policy to ensure a more efficient allocation of scarce public or private resources. Rules on competition are not about increasing market access per se, but rather about ensuring appropriate conditions which will enable market access to become effective and translate into real business opportunities.
European officials have made clear that anticompetitive behavior and certain subsidies are not the traditional tariff barriers to trade but can be important behind-the-border barriers. The EU is particularly interested in ensuring a level playing field for European and Vietnamese companies and avoiding trade benefits stemming from the FTA being neutralized by anti-competitive practices.
When properly designed, competition related issues are inherently pro-development, since it is developing countries whose companies and consumers are the most vulnerable victims of anti-competitive practices. Moreover, it will be easier for Vietnam to attract foreign companies if these can be reassured that basic competition laws will be respected.
The EU and Vietnam have agreed to a section on antitrust and mergers (anticompetitive conducts), including the obligation to maintain competition laws and relevant authorities and to apply the laws in a transparent and non-discriminatory manner. This means that companies operating in Vietnam should respect the same basic competition principles as in Europe, i.e., no abuse of a dominant position and no agreements between enterprises that restrict competition and scrutiny of the competitive effects of a merger.
At the same time, companies are assured that their rights in the competition procedures will be respected (procedural fairness) and that they can turn to the Vietnamese competition authorities to ask them to ensure an efficient competitive environment. Companies can receive subsidies for well-defined public policy objectives, such as research and development, training and regional development. However, the FTA acknowledges that certain kinds of subsidies can hinder competition and trade. Therefore, rules limit the potential negative effects of the subsidies. These cover transparency, consultations and some of the most distortive types of subsidies, which are made subject to specific conditions.
The EVFTA sets an illustrative list of such public objectives, including practices involving a direct transfer of funds, potential direct transfer of funds or liabilities; revenue that is otherwise due is foregone or not collected; providing goods or services other than general infrastructure, or purchase goods; making payments to funding mechanism, or entrusting or directing a private body to carry out one or more type of functions regulated; and any form of income or price support in the sense of exemption of non-discrimination principle in Article XVI of the 1994 General Agreement on Tariffs and Trade (GATT 1994).
Vietnam has agreed to notify not only of subsidies to goods but also subsidies to services. This goes well beyond the existing World Trade Organization (WTO) rules. As a result, at least every four years both sides will notify or make public the subsidies granted to companies in selected services sectors, which are important from market access point of view such as telecommunications, banking, transport and energy.
If a party considers that specific subsides granted by the other negatively affect trade or investment, it may express its concern in written form to the other and request consultations on the matter. The requested party shall provide information or conduct to eliminate or minimize these negatively affect caused by subsidies.
Duy Hung LINK
HCM City gets ready for new foreign investment wave
09:10 | 14/02/2023
As an economic locomotive, Ho Chi Minh City has always led the country in terms of investment attraction, drawing the attention of foreign investors from around the world.
However, to be able to strongly attract foreign direct investment (FDI) and welcome new investment waves, the southern hub needs to solve bottlenecks and stagnation in investment procedures. HCM City also needs to work on promoting the development of new areas such as technology, finance, and urban infrastructure.
According to the municipal Department of Planning and investment, the city topped the country in the total value of foreign investments in 2022, including new and additional investment capital and capital contribution, share purchase, and contributed capital purchase reached more than 3.94 billion USD, up 5.4 % compared to 2021.
Among newly granted projects, there were 820 newly granted works in the form of 100% foreign capital investment, 71 joint ventures, and two projects in the form of business cooperation contracts.
The city has several advantages in economic development, particularly high-quality human resources, and relatively developed infrastructure to attract investment in high-tech service industries, according to economic experts.
It also has a favourable strategic location, and is the country’s largest high-tech manufacturing and service centre as well as a multicultural city suitable for foreigners coming to work, live and travel.
The city will restructure its economic sectors to focus on attracting FDI in key industries. It will also promote investment attraction in industries with high added value on the basis of the high-tech industry and digital economy, automation, artificial intelligence, software, and microchips.
It has also focused on turning into the largest creative startup hub in the country to help improve the efficiency of the labour market. This will support the real estate market, science and technology, and the financial market according to the standards of the market economy and international economic integration.
Source: VNA LINK
Việt Nam to have 30 airports by 2030: draft planning
07:00 | 14/02/2023
Việt Nam will have a total of 30 airports by 2030 including 14 serving international flights, according to a draft plan that the Civil Aviation Authority of Vietnam (CAAV)has submitted to the Ministry of Transport recently.
The international airports are Vân Đồn, Cát Bi, Nội Bài, Thọ Xuân, Vinh, Phú Bài, Đà Nẵng, Chu Lai, Cam Ranh, Liên Khương, Long Thành, Tân Sơn Nhất, Cần Thơ, and Phú Quốc.
The 14 airports serving only domestic flights are Lai Châu, Điện Biên, Sa Pa, Nà Sản, Đồng Hới, Quảng Trị, Phù Cát, Tuy Hòa, Pleiku, Buôn Ma Thuột, Phan Thiết, Rạch Giá, Cà Mau, and Côn Đảo.
Two military airports – Thành Sơn and Biên Hòa – will be converted to use for both military and civil purposes.
The draft plan still includes the Hải Phòng International Airport project which was approved in the Prime Minister’s Decision No. 640/QĐ-TTg dated April 28, 2011.
By 2050, Việt Nam expects to have 33 airports including 14 international airports Vân Đồn, Hải Phòng, Nội Bài, Thọ Xuân, Vinh, Phú Bài, Đà Nẵng, Chu Lai, Cam Ranh, Liên Khương, Long Thành, Tân Sơn Nhất, Cần Thơ and Phú Quốc. There will also be 19 domestic airports (Lai Châu, Điện Biên, Sa Pa, Cao Bằng, Nà Sản, Cát Bi, Đồng Hới, Quảng Trị, Phù Cát, Tuy Hòa, Pleiku, Buôn Ma Thuột, Phan Thiết, Rạch Giá, Cà Mau, Côn Đảo, Biên Hòa, Thành Sơn and the second airport in the southeast, south region of Hà Nội).
CAAV will continue to study, survey, and evaluate the possibility of converting some existing military airports into dual-use facilities including Yên Bái airport in Yên Bái Province, and Gia Lâm airport in Hà Nội. The conversion will be reported to the Prime Minister for consideration when all necessary conditions are met.
In particular, this draft plan reflects CAAV’s openness to the new civil airports.
The agency proposes to continue studying, surveying and evaluating the possibility of building airports in provinces that are located in key positions in defence and security and with potential for tourism development but have no military airport. These are Hà Giang, Tuyên Quang, Hà Tĩnh, Kon Tum, Quảng Ngãi, Bình Thuận, Khánh Hòa, Đắk Nông and Tây Ninh.
The Transport Engineering Design Incorporated (TEDI) – consultant for the national airport development planning – proposes that the capacity of Long Thành airport by 2030 is 25 million passengers per year. The capacity of Long Thành airport would then increase to 100 million passengers by 2050. The Tân Sơn Nhất airport is to have a maximum capacity of 50 million passengers yearly.
Biên Hòa airport is expected to handle five million passengers yearly by 2030, and up to ten million passengers by 2050.
Source: VNS LINK
Việt Nam urged to ensure exports to Asian, African markets in 2023
February, 14/2023 – 08:56
These challenges included a world economic recession, competition among major big economies, trade protectionism, inflation and rising interest rates, MoIT’s Director of the Asia-Africa Market Department said.
HÀ NỘI — Vietnamese exporters need to ensure their capacity and maintain existing export markets, typically Asian and African outlets, amid many challenges in 2023, a senior trade official has said.
These challenges included a world economic recession, competition among major big economies, trade protectionism, inflation and rising interest rates, Lê Hoàng Oanh, Director of the Asia-Africa Market Department under the Ministry of Industry and Trade, said.
To do so, firms must make sure that their products meet the quality requirements of exported goods and shipped goods, which Asiam and African markets need rather than what they have, Oanh told congthuong.vn.
She said open export procedures, convenient logistics services, and updated information about the import policies of the host country would also be necessary to facilitate exports to these markets.
According to the official, ensuring raw materials would play a key role for exporters, especially those exporting textiles and garments to China and South Korea and others shipping seafood products to South Asia and Southeast Asia.
Input materials for production needed to be diversified to avoid dependence on one or several markets, she added.
In 2023, Oanh encouraged exporters to continue promoting their exports to some lucrative markets such as China and India. In China, firms should pay attention to the Yunnan market.
Guangxi and Yunnan have the same population of about 50 million people but the scale of Việt Nam’s trade with Yunnan in 2022 reached only US$3.2 billion compared to the country’s $30 billion trade with Guangxi, she explained.
Meanwhile, India is also a potential market with considerable purchasing power and market demand thanks to a population of 1.4 billion people. Annually, India imported about $560 billion worth of goods. However, Việt Nam’s exports made up only 1.4 per cent of the country’s total import value of $8 billion.
Besides the markets mentioned above, Oanh also advised exporters to look to African markets, which have much untapped opportunities for them to accelerate their exports, as Việt Nam only accounted for 0.6 per cent of Africa’s import turnover worth $600 billion per year.
Việt Nam’s merchandise trade with Asia reached $475.29 billion in 2022, increasing by 9.6 per cent compared to 2021 and accounting for the highest proportion (65.1 per cent) in the country’s total import-export value.
Major trade partners of Việt Nam in Asia include China, South Korea, Japan, and the Association of Southeast Asian Nations (ASEAN).
Last year, the value of imports and exports between Việt Nam and Africa was $8.1 billion, down 3.9 per cent.
— VNS LINK
Demand for industrial land for rent remains high
February, 14/2023 – 08:59
The demand for industrial land for rent in Việt Nam will remain high this year thanks to policies promoting investment in the country, experts said.
HCM CITY — The demand for industrial land for rent in Việt Nam will remain high this year thanks to policies promoting investment in the country, experts said.
Due to short supply, rental prices for industrial land are expected to continue to rise by an average of 8-20 per cent year-on-year in 2023, depending on the region, according to a report by the SSI Securities Corporation.
Last year, industrial real estate rents rose by an average of 10 per cent due to high demand, according to the report.
Trang Minh Hà, chairman of North Stars Asia Company, said that in Việt Nam, industrial real estate leasing has seen a hike in demand and rental prices, especially for logistics and warehousing.
The industrial land-for-rent market is likely to remain strong over the next 12 months, she added.
Demand for industrial land has surged as the occupancy rate in industrial hubs has reached almost 100 per cent, she said.
Many ready-built warehouses, factories and logistics and data centres are being built in industrial parks (IPs) across the nation, she added.
The average rent for industrial land in the southern region was $159 per square metre in the last quarter of 2022, up 3 per cent over the previous quarter and 10 per cent year-on-year, according to global real estate services firm Cushman and Wakefield.
The highest rent in HCM City was $300 per sqm. The occupancy rate increased to 92 per cent from 91 per cent. The average rent in Bình Dương and Long An provinces was $180.
According to the Ministry of Planning and Investment, Việt Nam has 292 industrial parks with a total land area of 87,100ha and 106 more are under construction.
They are home to some 10,000 domestic companies and 11,000 foreign-owned firms that have invested over $340 billion.
Việt Nam continues to be an appealing destination for industrial real estate investors, according to Cushman and Wakefield.
The firm attributed this to the country’s stable growth rate, an export-oriented economy, a young labour force, investment incentives, a strategic location and a positive economic outlook.
With a stable political environment, Việt Nam has also become popular for foreign investors moving out of China.
— VNS LINK
Source: Dinar Recaps
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