Category: Politics

Credit growth in the first months of this year slowed significantly due to high interest rates and firms’ poor health, raising concerns about rising bad debts.

Credit growth by the end of February 2023 increased by nearly 0.8%, equal to only one-third of the rate in the same period last year.

However, the low credit growth is not because of banks’ shortage of capital and credit growth quota like at the end of last year.

The banking system’s liquidity is currently in excess with more than 50 trillion VND (2.1 billion USD), higher than the SBV’s mandatory requirements. The credit growth quota of banks is also very abundant in the wake of the State Bank of Vietnam (SBV)’s credit growth quota granting early this month.

SBV Governor Nguyen Thi Hong attributed the slow credit growth to some reasons.

First, she said, the first two months of the year coincided with the Lunar New Year, so capital demand was low during the long holiday.

Secondly, many firms are still affected by the COVID-19 pandemic, thus they are unable to meet the banks’ lending conditions.

Orders at many firms declined, making the demand for loans to fall from last year.

Finally, the difficulty of the real estate market has also caused the loan demand to decline, the Governor said.

In a report sent to the Government, the Ministry of Planning and Investment said the low credit growth showed difficulties in absorbing the capital of firms and the economy.

According to many firms, their orders decreased, so they almost had no demand for loans. Even instead of borrowing more capital, many firms have tried to pay off existing loans to reduce financial pressure.

Most export firms are facing a decrease in orders. High inflation and declining purchasing power in major markets such as the US and the EU directly hurt firms.

A representative of the Vietnam Textile and Apparel Association said the decrease in global purchasing power would likely cause the number of orders of the whole textile and garment industry to decrease by 25-30% in the first quarter of 2023.

The situation is not brighter for firms in the wood and furniture industry. Do Thi Kim Loan, General Director of Sao Nam Trading and Production Company Limited, said orders from her company decreased by 30-35% compared to last year.

Banking expert Can Van Luc told the Viet Nam News that besides decreasing consumer demand, firms are also facing difficulties in accessing capital and high interest rates.

As firms’ health is exhausted, Luc is very concerned about the risk of rising bad debt.

“Currently, the bad debt ratio of the whole banking system is still under control with an on-balance sheet bad debt ratio of 2%,” Luc noted. “However, bad debts can worsen under the context of adverse impacts of the unfavourable conditions post-pandemic while the economy is at risk of a slight recession and the foreign exchange rate is under rising pressure.”

Nguyen Hoai Nam, Deputy General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said high interest rates are the biggest concern of firms. Therefore, he suggested the SBV offer a more preferential interest rate policy for seafood exporters, who are under great pressure due to high input costs.

Pham The Anh, head of the National Economics University’s Economics Faculty, said many factors would support interest rate reduction in 2023.

Vietnam should accept the devaluation of the Vietnamese dong in the short term to reduce interest rates as high interest rates are more harmful to the economy than the devaluation of the dong, Anh suggested.

The good news for firms is that commercial banks have agreed to further reduce the interest rates by 0.2-0.5 percentage points for 6-12 month deposits since early this week to pave the way for a reduction in lending interest rates.

Currently, the highest deposit interest rate is 9% per year against more than 10% last year./.

Source: Vietnam News Agency

Permanent Vice Chairman of the Vietnamese National Assembly (NA) Tran Thanh Man had separate meetings with President of the Inter-Parliamentary Union (IPU) Duarte Pacheco and Vice President of the Lao NA Sounthone Xayachak in Manama, Bahrain, on March 12 on the sidelines of the 146th IPU Assembly.

Meeting with IPU President Duarte Pacheco, Man affirmed that since Vietnam became a member of the IPU in 1979, the country has always actively and responsively engaged in its activities, including the successful hosting of some big events such as the 132nd IPU Assembly and the IPU Asia-Pacific conference on climate change response.

He said that Vietnam’s hosting of the upcoming IPU Global Conference of Young Parliamentarians once again affirms the country’s commitments, as well as its great attention to the role of the youth in global issues.

Man hailed the role of IPU leaders over the years, especially in strengthening the collaboration between the union and member parliaments for common targets of peace, democracy and prosperity.

He said that the Vietnamese NA always considers the engagement in IPU activities as an important multilateral diplomatic task that aims to seek solutions to urgent global issues. The IPU provides a forum for the Vietnamese legislature to learn good practices of other parliaments in the world and enhance its operational efficiency, Man added.

For his part, Pacheco said that the IPU and the Vietnamese NA share common values of a better world. The union always defines dialogue as an effective tool to narrow differences and settle crises and conflicts, he said, expressing his hope that the parliaments of all UN member states will become members of the IPU.

The IPU leader welcomed Vietnam’s hosting of the 9th IPU Global Conference of Young Parliamentarians in September, affirming that the union will work closely with Vietnam for the success of the event.

Pacheco said he believed that Vietnam will continue to be a responsible member of the IPU with the contributions of valuable ideas to the union and the willingness to perform tasks in the IPU in the time to come. Meeting with his Lao counterpart Sounthone Xayachak the same day, Man underlined that Vietnam always gives the highest priority to the reinforcement and enhancement of the traditional friendship, special solidarity and comprehensive cooperation with Laos, and always accompanies and supports Laos during the country’s national protection, construction, reform and development.

Regarding the relationship between the two legislatures, Man said that he is pleased at the effective implementation of the cooperation agreement signed in May 2022.

The two sides have actively shared experience in law building and supervision, contributing to supporting the post-pandemic economic recovery, he noted, suggesting that the two sides continue to work together in realising their cooperation agreement, while promoting the mechanism of high-level meeting of the Cambodia-Laos-Vietnam (CLV)’s parliaments, and collaborating in supervising the implementation of international conventions that the two sides have signed, especially those on trade and investment, thus strengthening the connectivity between the two economies.

Sounthone highly valued the outcomes of the Laos-Vietnam Friendship and Solidarity Year 2022 as well as the partnership between the two legislatures at regional and international inter-parliamentary forums over the years. He agreed with his Vietnamese counterpart on the enhancement of ties in supervising bilateral investment and cooperation projects, contributing to removing obstacles facing them and enhancing bilateral cooperation.

Sounthone expressed his hope to collaborate with Vietnam and Cambodia to organise the first meeting of the CLV’s NA leaders in December.

He also asked for the Vietnamese NA’s support for the Lao NA to complete its tasks as the AIPA Chair in 2024./.

Source: Vietnam News Agency

Phu Quoc island city, along with other coastal localities in the southern province of Kien Giang, has been concertedly rolling out solutions and exerting great efforts to fight illegal, unreported and unregulated (IUU) fishing.

Vice Chairman of the municipal People’s Committee Doan Van Tien said between now and May, Phu Quoc will continue the communications work to raise public awareness, especially among the boat owners, captains and fishermen, of the Fisheries Law 2017 and relevant issues.

The city is resolved to complete the registration and licensing of fishing vessels with a length from 6m to below 12m within the first quarter of this year, establish inspection teams, and deregister 1,146 fishing boats that are no longer operational.

It will coordinate with competent forces and agencies to enhance the inspections, supervisions and handling of wrongdoings by vessels at fishing grounds, Tien said, noting that all of the boat owners and captains should be committed to not violating foreign waters and fishing regulations.

Notably, since the beginning of this year, groups of the city’s steering committee on IUU fishing combat and its assistance forces have been set up via Zalo communication app, enabling them to stay updated and exchange information.

Inspections have been tightened over the installation and operation of the vessel monitoring system (VMS) on fishing vessels measuring from 15m in length. At the same time, all of the seafood handled at local seaports has been undergone product traceability.

Tien said such efforts have led to the absence of cases of illegal fishing in foreign waters by fishing boats registered in the city so far this year.

On October 23, 2017, the European Commission (EC) issued a “yellow card” warning to Vietnam, after the country failed to demonstrate sufficient progress in the fight against IUU fishing.

The commission is scheduled to conduct an inspection over IUU fishing in Vietnam in June 2023./.

Source: Vietnam News Agency

Thailand’s Department of Business Development (DBD) is eyeing a new tourism trend – food trucks – in an effort to attract more visitors to the country.

DBD Director-General Thosapone Dansuputra said food trucks can be seen as “destinations” that stimulate the economy and boost awareness of Thai cuisine.

Food trucks may encourage tourists to visit Thailand just to taste foods or beverages that cannot be found anywhere else, he said.

The official added that the food truck culture will also boost interactions between Thais and foreigners, as well as create cooperation opportunities.

Many Thais and foreigners showed interest in DBD’s activity promoting food trucks and small and medium enterprises (SMEs) at Bangkok’s IconSiam shopping complex from February 22-26, he said.

The five-day event generated 3 million THB (nearly 90,000 USD) in revenue. DBD also cooperated with financial institutions like Krungthai Bank, Bank of Adyudhya, Government Savings Bank, TMB Thanachart Bank and United Overseas Bank, to provide advice on requesting loans, he said.

This move was aimed at making it easier for SMEs to gain loans, he said, adding that some had already applied for loans at a special interest rate to expand their businesses.

Nawarat Mingchareonsuk, the operator of Food Truck Team Chang, said DBD’s event helped expand the market for food truck operators and also helped them witness consumer behaviour. This way, she said, they can improve their products to meet demands.

She also expressed confidence that the food truck business will flourish especially since it is being highlighted in tour programmes./.

Source: Vietnam News Agency

Seventeen Vietnamese enterprises are participating in the 2023 Seafood Expo North America, which opened at the Boston Convention & Exhibition Centre in Massachusetts state on March 12.

This year’s three-day expo draws the participation of hundreds of aquatic product and seafood exporters from different states of the US, and other countries like Canada, Brazil, Japan, India, Scotland, Ireland, Norway, Spain, and Vietnam.

Vietnamese businesses are showcasing the country’s key products such as tra fish and shrimp which have impressed a lot of visitors. Talking to the Vietnam News Agency, Ambassador Dang Hoang Giang, Permanent Representative of Vietnam to the United Nations (UN), stressed the bright outlook for the export of Vietnamese seafood and aquatic products to the US in general and North America in particular.

The participation of Vietnamese enterprises in North America’s largest seafood expo shows that Vietnamese products have gained a firm foothold in such a choosy market like North America.

The US is the leading importer of Vietnamese seafood and aquatic products. Last year, the export turnover to this market reached 2.1 billion USD, accounting for 20% of the total value of the country’s seafood and aquatic product exports./.

Source: Vietnam News Agency

The State Bank of Vietnam set the daily reference exchange rate at 23,638 VND/USD on March 13, down 1 VND from the last working day of previous week (March 10).

With the current trading band of +/- 5%, the ceiling rate applied to commercial banks during the day is 24,823 VND/USD and the floor rate 22,459 VND/USD.

The opening hour rates at commercial banks also decreased.

At 8:45am, Vietcombank listed the buying rate at 23,480 VND/USD, and the selling rate at 23,850 VND/USD, both down 10 VND from the end of March 10.

BIDV reduced both rates by 15 VND to 23,520 VND/USD (buying) and 23,820 VND/USD (selling).

During the week from March 6-10, the daily reference exchange rate mostly followed a downward trend except for Thursday (March 9). However, it still ended the week up 3 VND from the rate at the beginning of the week./.

Source: Vietnam News Agency

A delegation of the Vietnamese National Assembly (NA) Secretariat is attending a meeting of the Association of Secretaries General of Parliaments (ASGP) in Manama capital of Bahrain from March 11 to 15.

The annual meeting is held in parallel with the Assembly of the Inter-Parliamentary Union (IPU).

This year’s event covers such issues as citizens’ participation in parliamentary activities, gender inequality in parliaments, parliamentarians and conflicts of interest, the role of parliaments in the climate change combat, and questionnaire to create a best practice guide for digital parliaments.

It also includes an ASGP Executive Committee session on the reform of administrative processes in parliaments, and the election of the executive committee’s membership.

Leading the Vietnamese delegation, Bui Van Cuong, Secretary General of the NA and Chairman of the NA Office, is scheduled to deliver a speech at the plenary session on March 13 morning (Bahrain time).

The ASGP, convening the first meeting in Oslo (Norway) on August 16, 1939, is a consultative body of the IPU and a forum for secretaries general of parliaments to share experience and reach consensus on advice about globally important issues needing attention to be submitted their respective parliaments.

It is also tasked with studying laws, procedures, practices, and working methods of different parliaments to propose reforms while enhancing relations among the bodies assisting parliaments and among secretaries general./.

Source: Vietnam News Agency

Honda Vietnam has reported its fall in motorcycle and automobile sales at 36.8% and 7.3% respectively in February.

That is the second month in a row the company recorded sale falls after seeing a growth of nearly 19% for motorcycles and 62% for the automobile last December.

In February, it sold 140,669 motorcycles, down 36.8% compared to the previous month. Specifically, the sale of Wave Alpha – its best-seller semi-automatic model, decreased by 42.6% compared to that in January.

Similarly, Vision – its best-seller scooter model – also saw a sales decrease of 34.9%, and Winner X clutch 27% compared to the previous month.

Previously, the Vietnam Association of Motorcycle Manufacturers (VAMM) forecasted that the Vietnamese motorcycle market had entered a period of saturation and was shifting from manual transmission motorbikes to automatic ones. Currently, the automatic transmission motorbike lines account for more than 45% of the market share and will be a strongly growing segment soon when Vietnam’s per capita income increases.

In February, Honda Vietnam also exported 23,917 motorcycles.

Meanwhile, the Japanese manufacturer last month sold 1,385 automobiles, down 7.3% from the previous month. Honda City and Honda CR-V continued to be the two best-selling models of Honda Vietnam with 1,235 vehicles, accounting for 89.2% of its total car sales in February./.

Source: Vietnam News Agency