Vietnam 20241024: Vigorous, Exigent, Weighty
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Headlines:
Banks Pop the Champagne as Profits Soar
Global Giants Eye Vietnam as Supply Chain Star
Brussels and Hanoi Cozy Up
IMF Crystal Ball Says 6.1% Growth
State Companies Generate $2B Profit
Lobster Exports to China Explode
Nuclear Power Control Stays with State
Coffee Exports Hit $5B Milestone
Solar Power Sales Get Cap
China Radar System Raises Concerns
Halal Market Opportunity Emerges
Software Park Expansion Approved
China Railway Link Price Tag Estimated at $7.2B
Power: Projects Get Green Light
Remittance Fees Under Scrutiny
E-cigs Threaten to Reverse Anti-Smoking Gains
Banks Pop the Champagne as Profits Soar
Several Vietnamese banks reported impressive third-quarter performance. Techcombank's pre-tax profit reached VNĐ22.8 trillion in the first nine months, up 33.5% year-on-year, with net interest income up 33.9%. LPBank's Q3 pre-tax profit grew 133% to VNĐ2.89 trillion, supported by a 43.5% increase in net interest income and 519% growth in service revenue. Total assets for both banks grew substantially.
Read more: Vietnam News
Global Giants Eye Vietnam as Supply Chain Star
Vietnam is growing in its role as a darling of global manufacturing. Supply chains are expanding as international businesses look for new production bases. The investment shift is boosting Vietnam's industrialization and offers opportunities in semiconductors and software. The transformation requires infrastructure improvements, including ports, airports, and logistics facilities. Integration will support the transfer of technical expertise and skilled worker training.
Read more: Vietnam News
Brussels and Hanoi Cozy Up
Vietnam and the EU reinforced their partnership at the fifth Joint Committee meeting in Hanoi. Vietnam called on EU member states to ratify the EU-Vietnam Investment Protection Agreement and requested reconsideration of the seafood export yellow card warning. The EU praised Vietnam's regional importance and pledged support for energy transition, technology cooperation, and defense partnerships.
Read more: Vietnam Insider
IMF Crystal Ball Says 6.1% Growth
The IMF latest forecast has Vietnam's GDP growth at 6.1% for both 2024 and 2025, below the government's 7-7.5% target. GDP is expected to hit $500 billion in 2025, ranking 33rd globally. Consumer prices are expected to rise 3.5% in 2025, down 0.6% from 2024. Unemployment rates should drop from 2.1% to 2%.
Read more: Vietnam News (Economic Forecast), The Investor (Growth Revision)
State Companies Generate $2B Profit
Nineteen state-owned groups and corporations reported combined revenue of VND971.6 trillion in the first nine months of 2024, up 15% year-on-year. Pre-tax profits reached VND50.36 trillion, surpassing annual targets by 20%. Total consolidated equity stands at VND1.53 quadrillion.
Read more: Vietnam Economic News
Lobster Exports to China Explode
Vietnam's lobster exports to China jumped 33-fold to $205.87 million in January-September 2024. September exports rose 133.9% month-on-month. China's total lobster imports increased 40.86% while import prices fell 23%. The surprising growth is a reflection of Chinese consumers' appetite for high-end foods, as well as improved trade ties between the two countries.
Read more: VnExpress
Nuclear Power Control Stays with State
The government proposed keeping nuclear power development strictly in-house, maintaining sole state investment rights. The Prime Minister said that the state should regulate mechanisms for investments, construction, and operations of nuclear plants. The policy is intended to make sure national energy security under Vietnam's power development plan VIII.
Read more: Nuclear Engineering International
Coffee Exports Hit $5B Milestone
Vietnam's coffee exports passed the $5 billion mark for the first time in the 2023-2024 crop year, despite a drop in volumes. Export volume was down 12.1% to 1.46 million tonnes, but value rose 33.1%. The EU remained the largest market, importing 563,000 tonnes worth $2 billion. Average export prices went up to $5,469 per tonne in September, the highest ever recorded price.
Read more: Dan Tri News
Solar Power Sales Get Cap
A new government decree limits excess rooftop solar power sales to 20% of installed capacity. The Ministry of Industry and Trade will set prices for excess power sold to the national grid. Self-produced power faces no pricing restrictions under the decree.
Read more: Vietnam News
China Radar System Raises Concerns
China installed a radar system on Triton Island in the disputed Paracel archipelago. The system could monitor an area from Hainan Island to Subi Reef in the Spratlys. The development is of concern to Vietnam as Triton sits only 130 nautical miles from its mainland coast.
Read more: South China Morning Post
Halal Market Opportunity Emerges
Vietnam is in a good spot to become a key player in the global Halal scene, a market expected to be worth as much as $10 trillion by 2030. Experts from Saudi Arabia and India have been enthusiastic about Vietnam's potential as a link in the Halal supply chain at the recent International Halal Conference in Hanoi.
Read more: Tuoitrenews
Software Park Expansion Approved
The government has approved the expansion of Da Nang Software Park No. 2, covering 28,573 square meters. The VND986 billion project started in 2020 and should create 6,000 IT and digital technology jobs. Companies investing in the park will receive incentives under Government Decree No. 154.
Read more: Tuoitrenews
China Railway Link Price Tag Estimated at $7.2B
Vietnam calculated the cost of building a 427km railway connecting to China's Yunnan province at $7.2 billion. The line would run from Lao Cai through Hanoi and Haiphong to Ha Long City, modernizing the country's colonial-era rail network.
Read more: Global Construction Review
Power: Projects Get Green Light
EVN (Vietnam Electricity) is looking for government approval for new power generation projects beyond its current 38% system capacity share. The utility is developing ten projects totaling 6,793MW. Separately, Nghệ A province approved land for a $2.15 billion LNG power complex with two 1,500MW turbines.
Read more: Vietnam News (EVN Plans), Vietnam News (LNG Project)
Remittance Fees Under Scrutiny
Banking experts are calling for reduced remittance fees through collaboration between Vietnamese and foreign institutions. Remittances are vital for Vietnam's economy, particularly Ho Chi Minh City. The program has grown from modest sums to billions of dollars annually, helping offset trade deficits at an important time in Vietnam’s growth story.
Read more: VIR
And now for something completely different.
While the focus of The Memo is on news for business, we often wrap with a less business-focused article or two.
In other news this week, a Bronze Age settlement has been excavated in Northern Vietnam, the New York Times has ideas for what to do with 36 hours in Hanoi, South Korean doctors are increasingly looking to move to Vietnam, Lonely Planet has once again tagged the South as a top global destination, and a big Vietnam War-era bomb was pulled from the river in Hanoi.
E-cigs Threaten to Reverse Anti-Smoking Gains
Vietnam’s decade-long progress in reducing smoking rates is at risk as e-cigarette usage booms, particularly among youth. E-cigarette use among students aged 13-15 rose from 3.5% in 2022 to 8% in 2023. Health experts are at pains to inform the public of the dangers of nicotine addiction and the harmful chemicals in e-cigarettes, challenging claims of harm reduction. The WHO has warned against misleading information regarding the safety of such products, saying that Vietnam needs to do more to address this growing public health concern.
Read more: Tuoi Tre News
That’s it for this week!
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