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Foreigners receive discipline for violating traffic law in HCMC

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Ho Chi Minh City’s police embarked on a campaign to disseminate traffic rules among foreigners in the city from August 1

The campaign will run until August 15 and foreign violators will receive warnings in the period.

From August 16 until the end of October, the city’s police will increase patrols and impose traffic fines on foreigners who break the traffic rules. VOV reports.

According to statistics by the Ministry of Labour, Invalids, and Social Affairs, the number of foreign employees in Vietnam increased from 63,557 in 2011 to 83,046 in 2016. They mostly came from Asian countries like China, the Republic of Korea, and Japan, accounting for 73 percent of the total; followed by European nations (21.6 percent) and North America (2.4 percent).

Foreigners violating traffic law in Vietnam @ Credit: phapluatplus.vn

Lieutenant Colonel Nguyen Van Binh of the Road-Railway Traffic Police Division under the HCM City Department of Police said the officers who are fluent in foreign languages will be mobilized in the campaign.

According to VOV, fifteen days after launching a campaign to examine vehicles in HCM City, traffic police dealt with more than 10,000 violation cases and imposed fines worth nearly 4 billion VND (172,510 USD).

There have been an increasing number of foreigners staying in Vietnam, as international visitors to the country in the January-July period surpassed 9.79 million, up 7.9 percent year on year. This year, Vietnam strives to serve 17.5 – 18 million foreign tourists.

5G being put on fast track in Vietnam

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Vietnam is making a tilt at the front ranks of telecom with an ambitious 5G timetable.

Its biggest operators are running 5G field trials and aim to have commercial services running next year.

If achieved, that would put them close behind the region’s leaders, Korea and China.

The biggest local operator, Viettel, which carried out Vietnam’s first 5G end-to-end 5G connection in May, has deployed 70 trial base stations in Hanoi and Ho Chi Minh City. Robert Clark reports on Light Reading.

Rivals Mobifone and Vinafone are also in the 5G hunt with trials this year.

The driver for all of this is the government’s economic ambitions.

“We want to be at the forefront of the fourth Industrial Revolution and develop the ICT sector,” Information and Communications Minister Nguyen Manh Hung told Vietnam News.

Industrial 5G was a priority, Nguyen said. “Viettel and other network providers must experiment to cover 5G in all hi-tech zones, national innovation centres and smart factories by 2020,” he said.

But this timetable is going to be a stretch, even for Viettel, the $11 billion heavyweight.

For one thing, the country advanced to 4G as recently as 2016. Operators elsewhere in the world have had eight or more years to achieve an economic return. Vietnam carriers will have barely half that.

Another issue is that, unlike every other developing country in the world, Vietnam won’t be buying from Huawei.

There is no formal ban on buying Huawei kit, and neighboring countries Malaysia, Indonesia and Cambodia have no qualms, a recent New York Times story points out.

But Vietnam has historically had an uneasy relationship with China. The two countries fought a short war in 1979 and Vietnam, like other neighbors, is wary of China’s expansion into the South China Sea.

Mobifone and Vinaphone are going with Samsung and Nokia respectively.

According to Light Reading, Viettel, which is owned by the Vietnamese military, doesn’t use Huawei in its 4G network, although it did buy some 3G equipment from the Chinese vendor a decade ago.

It appears likely to choose Ericsson, its trial partner, or Nokia for its radio network.

But when it comes to the core, it is even more ambitious.

It plans to build its own equipment to ensure the “security of the national telecommunications network,” an unnamed Viettel executive told the Nikkei Asian Review earlier this year.

It wants to produce “80% of [its] telecom core network infrastructure” equipment by 2020.

“Viettel has invested millions of dollars to develop 5G chips and is working on developing devices with 5G chips,” the executive said.

Unusually for an operator, Viettel has a commercial solutions division which sells solutions, including a billing platform, to other telcos.

It has already developed an EPC for LTE which it demonstrated at MWC Barcelona in February.

‘Dubai police car’ has become a hit in Vietnam

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A look-alike car with the Dubai Police logo has become an internet sensation

A motorist in Vietnam who liked the logo of Dubai Police’s supercars has used it to decorate his own private vehicle in Ho Chi Minh City. Ali Al Shouk reports on Gulf News

The online video, which went viral on social media on Thursday, was recorded by an Arabic tourist in southern Vietnam.

The tourist who visited Ho Chi Minh City, formerly known as Saigon, expressed his surprise to see a Dubai Police car in the middle of the street.

According to Gulf News, the video showed the man approaching the four-wheel drive vehicle, which carried the green logo of Dubai Police, and asked the owner why he did that.

A look-alike car with the Dubai Police logo

“I was surprised to see Dubai police car with Vietnamese plate number in Saigon. The owner didn’t know what the logo means. He found the logo on the internet and it seems he liked the Dubai Police Ferrari and copied the logo to decorate his car,” the man said in the video.

Dubai Police response:
Colonel Faisal Al Qassim, director of the Dubai Police security media department said: “It is nice that people like the Dubai Police logo and put it on their cars in their countries, but there is still a problem if the driver causes an offence as the vehicle can be seen on the street. It also breaches intellectual property rights.”

Al Qassim said that Dubai Police vehicles, which include a range of super cars, attract a lot of attention from tourists who come to the UAE and that this might have inspired the Vietnamese driver to decorate his car with the same design.

“We feel proud that Dubai Police has become a reason for happiness or inspiration for those inside and outside the country,” added Al Qassim.

However, he said he hoped authorities in Vietnam would solve any potential problems by asking the motorist to remove the Dubai Police logo from his car.

“It is forbidden to put any police logo on a personal car.”

Starting Up E-Bike Battery Production in Vietnam

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The trade agreement between the EU and Vietnam provides a unique opportunity for e-bike manufacturers and importers. E-bike battery expert James Post offers collective battery production in Vietnam. Very competitive, up to 28 Ah and 8 years prorated warranty; a pioneer in safety monitoring.

E-bike manufacturers and importers, who plan to produce SKD e-bikes in Vietnam or elsewhere outside China, can join a collective production of rear carrier batteries. Production is a collective which also means that smaller vendors can participate and obtain high quality batteries for as low as 140 euro CIF Rotterdam (15 Ah) in small series of 5,000 batteries only. Logistically, it is no problem to mount carrier batteries on location. This makes the concept very attractive, regardless where the e-bikes are assembled. Bike-eu.com reports.

The collective approach allows for low R&D and start-up costs. Prepayment are not required, only bank guarantees.

Why e-bike batteries
Quality issue in the battery industry in combination with EU anti-dumping duties on China made e-bikes resulted in an all new approach. To apply to the 2.5 percent EU import duty on Vietnam made e-bikes, they have to abide to the local content rules. These rules specify that 50 percent of the ex-works price of the e-bikes exported to Europe must be made with in Vietnam manufactured components. For e-bikes this means that either the battery or the motor must be made locally. However, production of motors requires too much R&D and fine tuning. With the efficient assembly method, as proposed by James Post, batteries can be mass produced within six months after the start. Well in time for MY 2020.

Technical details
For most batteries on the market two issues result in a lower lifetime. Our superior approach:

Contrary to electric vehicles, almost all e-bike batteries are always charged to 100 percent. As studies proved (available on request), the cycle lifetime is more or less double when charging to 80 percent. The battery we will produce in Vietnam allows to select a charge percentage each time. Via a smartphone app or a manual charger switch the user can select 60/70/80 percent to save lifetime, or 100 percent for an occasionally long trip and 40 percent for storage. The 40 percent option also provides automatic recharging when needed.

The use of plastic enclosures and plastic cell holders is about as bad as a thermal design can get. Yet, this approach is quite common as it is the cheapest. We work with thermally conductive, flexible cell holders which efficiently transfer the cell heat to the aluminum enclosure. Obviously, this is the ideal situation for heat dissipation. This technology not only saves lifetime, but also allows for more cells per battery. We can offer up to 80 18650 cells!

Prorated warranty
New to the e-bike industry but common in others is the is the prorated warranty. After two years of regular warranty, each half year of use (or part thereof) means the battery will be written off by 6.25 percent. For example: after 4.5 years an end user claims a warranty which is approved. He consequently pays 9 x 6.25 percent = 56.25 percent for a new battery. A fair system to the consumer, giving the supplier a good image. Warranty will be provided by ECOpro Technology BV.

Time frame
On 22, 23 and 24 August 2019, James Post will have introductory meetings with potential local partners.
Early October 2019 production will be lined up for partners.
Preceded by prototypes and trial runs, mass production will be available as of April 2020.

Why inquire now
Participants who sign up before 30 September 2019 will benefit from the founding participants preferential pricing. Inquiring involves no obligations whatsoever.

Inquiries: James Post, CEO, ECOpro Technology BV, BatteryCollectiveVN@gmail.com

VN-Index grows for second day on corporate prospects

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Việt Nam’s benchmark VN-Index advanced for a second day on the back of realty, retail and consumer staple sectors as investors are looking towards prospects for the upcoming months.

The VN-Index on the Hồ Chí Minh Stock Exchange rose 0.58 per cent to close at 997.39 points, totalling a two-day gain of 1.15 per cent.

The index lost as much as 0.08 per cent during the day.

In the early stages of Thursday, investors reacted negatively to the conclusion of the Fed meeting and the US-China talks, which delivered few positive signs of improvement.

The Fed meeting ended on Thursday morning (local time) with interest rates dropping by 25 basis points – level to previous forecast – but Fed officials disappointed the global markets by signalling no further rate cuts this year.

Meanwhile, the US-China trade talks made no progress to improve the tension between the world’s two biggest economies.

The results had been widely expected by global investors, thus they had little impact on Vietnamese stocks, Sài Gòn-Hà Nội Securities (SHS) said in its daily report.

Later on, the VN-Index advanced as large-cap stocks increased. The VN30-Index, which tracks the performance of the 30 largest stocks by market value and trading liquidity, was up 0.48 per cent to finish at 887.39 points.

Seventeen of the 30 biggest stocks made gains, including realty firms Novaland (NVL), Vinhomes (VHM), Vingroup (VIC), Vincom Retail (VRE), retailers Phú Nhuận Jewellery (PNJ), Mobile World (MWG), brewer Sabeco (SAB) and dairy firm Vinamilk (VNM).

Those companies helped lift the real estate, retail and food and beverage industry indices by a range of 0.6 per cent and 2 per cent, data on vietstock.vn showed.

According to SSI Securities Corp (SSI), investors have a positive outlook for the market in the remaining months on expectations that both businesses and the macro-economy will perform better.

Recent data from the General Statistics Office (GSO) showed total value of retail and food and beverage sales was up 11.6 per cent year on year to reach VNĐ2.8 quadrillion (US$120.4 billion) in the first seven months of 2019.

Purchasing power increased because buyers purchased more in the summer time for hot weather, travel and spiritual purposes, according to GSO, thus boosting earnings of consumer firms.

Meanwhile, real estate firms are predicted to perform better in the remaining months of the year as they may still benefit from loose lending policies, recent reports say.

However, the market will struggle on Friday, according to SHS, as the VN-Index has approached the 1,000-point level which was its previous peak met in April 2019.

The 1,000-point level is the suitable sell zone for investors with short-term appetite, so the VN-Index will likely struggle at this level, SHS said.

On the Hà Nội Stock Exchange, the HNX-Index fell 0.52 per cent to end at 103.88 points.

The northern market index ended flat on Wednesday.

More than 248.3 million shares were traded on the two local exchanges, worth VNĐ5.52 trillion ($237.5 million).

Source: VNS

80 percent of Vietnamese human trafficking victims end up in China

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In most cases of human trafficking uncovered since 2016, the victims were sold to China, according the Ministry of Public Security.
More than 1,000 cases were detected by June this year involving 2,600 victims.

In 829 of them, the traffickers sold 2,319 people to China, according to ministry data released at a meeting on Tuesday.

Most cases had been found in northern border provinces such as Lao Cai, Ha Giang, Dien Bien, and Quang Ninh, and most of the victims were women and children.

In just six months from July last year Chinese authorities rescued more than 1,100 trafficked women, many them sold as brides, in a joint operation with Cambodia, Laos, Myanmar, Thailand and Vietnam.

Besides the financial situation of victims, police officers have said negligence, easy immigration procedures and gender imbalance in destination countries are also responsible for human trafficking.

China, the world’s most populous country, suffers from one of the worst gender imbalance rates due to its one-child policy and illicit abortion of female fetuses by parents wanting sons. This has led to increasing trafficking of Vietnamese women and baby girls.

In its 2019 Trafficking in Persons Report issued in June, the U.S. said Vietnam has not fully met the minimum standards of the U.S.’s Trafficking Victims Protection Act of 2000 but is making significant efforts to comply with those standards.

Vietnam’s efforts have included running major awareness campaigns in communities vulnerable to trafficking and government-facilitated training for consular officers, police and other relevant agencies in combating trafficking, the report said.

The lack of interagency coordination and provincial officials’ lack of familiarity with anti-trafficking laws and victim protection continue to impede anti-trafficking efforts, it said.

Traffickers increasingly use the Internet, gaming sites and, particularly, social media to lure potential victims into vulnerable situations while many men entice young women and girls with online dating relationships and persuade them to move abroad and then subject them to forced labor or sex trafficking.

Some traffickers pose as police officers on social media to gain victims’ trust.

Some Vietnamese women are also misled by fraudulent employment opportunities and sold to brothel operators on the borders of mainland China, Cambodia, Laos, and elsewhere in Asia, including Malaysia, South Korea, Singapore, Taiwan, and Thailand.

Source: Vnexpress

Vietnam commercial banks report no losses in H1

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Among 25 banks that have announced H1 business results, none reported losses and some have posted robust profit growth.
State-owned Vietcombank continued to top the chart with a pretax profit of VND11.3 trillion ($487.48 million), a 40.9 percent rise and higher than the combined profit of the next two banks.

Techcombank was second with VND5.66 trillion ($241.52 million), a more modest 9 percent increase.

Vietinbank earned the third highest pretax profit at VND5.34 trillion ($230.36 million) – rising two places from the end lof ast year. Its pretax profit grew by one percent after it wrote off bad debts of VND7.5 trillion ($323.55 million), 50 percent higher than in the first half last year.

Some banks have posted high profit growth mainly because of the decrease in risk provisions and the increase in their earnings from currency trading and other financial services.

Vietnam International Bank (VIB) saw its pretax profit rise by almost 60 percent to over VND1.8 trillion ($77.65 million), while that of Tien Phong Bank (TPBank) rose 58 percent to VND1.6 trillion ($69 million).

Vietnam has nine wholly-owned foreign banks, four state-owned banks and 31 joint-stock banks.

Source: Vnexpress

Grab & Moca pushing cashless payments

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Grab and its partner Moca are particularly geared towards making Vietnam a cashless economy.

Vietnam has been named as the fastest growing market in mobile payments in 2019 among 27 countries and territories worldwide, with user numbers rising 61 per cent from 37 per cent in 2018, according to the Global Customer Insights Survey 2019. Mr. Nguyen Tuan Anh, Head of Grab Financial Group Vietnam, said that with more mobile phones than bank accounts, apps that consumers trust and use daily are in an ideal position to drive the adoption of cashless payments. “Cashless payments play a positive role in boosting economic growth, particularly when the government is making cashless payments a priority around the country, with interoperability and other pro-cashless initiatives through the ‘Scheme for the Development of Non-Cash Payments in the 2016-2020 Period’,” he added.

As one of the leading technology companies, Grab’s vision has always been to use #TechforGood to drive the country forward. With its strategic partnership with Moca, one of the pioneers of Vietnam’s mobile payment solutions and with strong local roots and insights, Grab can support many of the needs of the 97 million people in Vietnam. The Moca e-wallet on the Grab app is part of Grab’s super app ecosystem serving most of the essential needs of consumers, including on-demand e-hailing services, parcel delivery, food delivery, and cashless payments. The strengths of the partnership, composed of Moca’s extensive credibility and expertise in technology, payments, and the banking sector, and Grab’s know-how, like machine learning, artificial intelligence (AI), big data, and data analytics, have fully complimented each other, resulting in tremendous growth in cashless payments since being announced.

Because of the interconnectedness of each of the services and how they help each other to grow, Grab and Moca are creating an entire ecosystem of connected users who are not only passengers and driver-partners but also agents, merchants, and delivery-partners. Only six months after launch, Grab users can already enjoy Moca’s cashless payments for their GrabFood and GrabExpress orders beyond Grab rides, and also split bills with friends and loved ones through a peer-to-peer fund transfer feature, together with some other cashless features such as mobile top-ups, paying at offline merchants, including traditional street food and local restaurants, and making bill payments. Among these, some have achieved triple-digit month-on-month growth.

Mr. Anh is proud that Grab is not just one of the most frequently used consumer apps in Vietnam but also that 35 per cent of its transactions are already cashless. “Our partnership with a strong local payments service provider like Moca will create more trust and lower the barriers to cashless further for Vietnamese consumers and support Vietnam’s move towards a 90 per cent cashless economy by 2020,” Mr. Anh said. “We believe that Vietnamese people are ready for cashless payments, especially for small and daily transactions, if the technology fits their everyday needs.” Sharing the same viewpoint, Mr. Tran Thanh Nam, Co-founder and CEO of Moca, said he believes that consumers are leading increasingly digital lifestyles and the Grab and Moca partnership helps promote this digital lifestyle. “We expect exponential growth in mobile payments around Vietnam driven by Moca and Grab,” he added.

However, the move towards cashless payments in Vietnam is also grappling with some very real challenges. According to Mr. Anh, the habit of paying by cash remains widespread, especially in rural areas. “What we need to do is enrich our Grab service ecosystem and create more use cases so that consumers see that cashless payments are far simpler and more convenient,” he said. “Being convenient, however, is not enough – it needs to be seen that cashless payment is more beneficial for consumers to convince them to go cashless. Only when customers realize this advantage will they use Moca e-wallet more. By focusing on how to use #TechforGood, how we can improve lives and constantly challenge ourselves to innovate, we believe that together with Moca we can offer the most advanced and convenient e-wallets for everyday payment needs and gradually make cashless payments a habit of everyone. This will bring about greater efficiencies and tremendous economic benefits in support of the Vietnamese Government’s vision of turning Vietnam into a cashless economy by 2020.”

Grab’s aims in Vietnam are, among others, to drive financial inclusion through strategic partnerships with local partners and empower millions of micro-entrepreneurs to grow their business. “Together with our partners, Grab is fully committed and focused on how we can use #TechforGood to connect millions to the cashless economy and benefit every Vietnamese, so that we can not only bring a swift, seamless, and secure cashless payment experience to Vietnamese but also move everyone into the digital economy for the future,” Mr. Anh said.

Source: Vneconomictimes

At regional meeting, Vietnamese FM says China’s actions in East Vietnam Sea ‘erode trust’

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Vietnam’s Deputy Prime Minister and Minister of Foreign Affairs Pham Binh Minh on Wednesday expressed his grave concern over Chinese vessels’ illegal movements in the East Vietnam Sea at a meeting in Thailand between foreign ministers of Southeast Asian nations and China.

While attending the ASEAN-China Foreign Ministers’ Meeting in the framework of the 52nd ASEAN Foreign Ministers’ Meeting (AMM-52) in Bangkok, Minh stressed that the Chinese survey ship Haiyang Dizhi 8 and its escorts’ recent activities in the waters are a violation of Vietnam’s Exclusive Economic Zone (EEZ) and Continental Shelf.

The Chinese vessels have, since July 3, blatantly disrupted and interfered with Vietnam’s economic activities through illegal actions in the areas near the Tu Chinh – Vung May (Vanguard Bank – Rifleman Bank) region in the East Vietnam Sea, according to updates on Twitter by Prof. Ryan Martison from the U.S. Naval War College.

Hanoi has made repeated demands that Beijing withdraw its ships from the Vietnamese waters.

Minh stressed to those in attendance at the meeting on Wednesday, in the presence of China’s State Councilor and Foreign Minister Wang Yi, that such actions seriously threaten the legitimate rights of coastal countries, erode trust, and worsen tension, thus hurting peace and stability in the Southeast Asian region.

More seriously, the actions follow on the heels of large-scale land reclamation activities and militarization of disputed maritime entities in the East Vietnam Sea.

Minh noted progress in negotiations for a code of conduct (COC) of parties in the East Vietnam Sea while reiterating ASEAN’s consistent stance on the importance of enhancing confidence, non-militarization, preventing actions that complicate the situation, and upholding international law, including the 1982 United Nations Convention on the Law of the Sea (UNCLOS), in order to achieve an effective COC.

Highlighting the strategic significance of ASEAN-China relations, Minh affirmed that Vietnam will join hands with other ASEAN member states to promote the partnership and collaboration between the sides, especially in the fields of mutual interest.

Source: Tuoitrenews

Sharp will form a new subsidiary in Vietnam

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Sharp Corporation has decided to construct a multiple production plant in Vietnam, and to establish a 100% owned subsidiary to manage the operation of the plant, the company said in a statement on Thursday, August 1, 2019.

The plant managed by the new company will start production of air purifiers, LCD displays, electronic devices etc. from fiscal 2020, it said.

Sharp is accelerating its actions to create featured products and services this fiscal year to establish its position as a global brand. By establishing the new company as the core to promote sustainable development for this fiscal year and on in the ASEAN region where high degree economic development is continuing, Sharp will aim to raise its corporate value by utilizing the advantages as One SHARP.

Sharp Corporation (TSE: 6753) is a worldwide developer of innovative products and core technologies that play a key role in shaping the future of electronics. As a leader in liquid crystal displays (LCDs) and digital technologies, Sharp offers one of the broadest and most advanced lines of consumer electronics, information products and electronic components, while also creating new network businesses.

Nomura Real Estate acquires Zen Plaza building in Vietnam

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Prime location with occupancy rate of 98% houses mostly foreign companies

Nomura Real Estate Development confirmed that, the company has acquired the 14-story Zen Plaza building in Vietnam’s Ho Chi Minh City in July, also buying the company which owns the tower. Nikkei Asia reports.

The deals follow Nomura’s acquisition of a controlling interest in Sun Wah Tower, the company’s second rental office building in the city.

Ho Chi Minh City is the country’s largest commercial hub, located about 1,700 km south of Hanoi.

The newly acquired building — a 12-minute drive from Saigon Station — is on Nguyen Trai Street, home to a large number of apparel stores. The location offers easy access to the city’s business hubs.

Completed in 1999 and featuring 14 floors above ground and two below, Zen Plaza has a total floor space of approximately 17,000 sq. meters, of which 11,700 sq. meters can be leased.

Zen Plaza’s former tenants were mostly retail stores, but the location has since been converted into office space. Roughly 90% of the tenants are foreign companies, of which 70% are Japanese.

Occupancy rate as of July 2019 stood at 98%.

Nomura’s overseas business is listed as one of the company’s growth fields in its latest mid- to long-term business plan. The company will have invested approximately $2.7 billion (300 billion yen) in its foreign operations by the fiscal year ending March 2028.

The company wants overseas operations to eventually account for between 15% and 20% of total revenue.

According to Nikkei Asia, Nomura plans to expand into other countries while growing its existing presence in Thailand, Vietnam, the Philippines and China.

Vietnam to face severe power shortages from 2021

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Vietnam will contend with severe power shortages from 2021 as electricity demand outpaces construction of new power plants in the Southeast Asian country, the Ministry of Industry and Trade told media on Wednesday.

The lack of energy infrastructure could put the brakes on foreign investment inflows into one of Asia’s fastest-growing economies and challenge Vietnam’s position as the top beneficiary of the U.S.-China trade war. Khanh Vu reports on Reuters.

Vietnam’s demand for electricity will exceed its supply by 6.6 billion kilowatt hours (kWh) in 2021, increasing to 15 billion kWh by 2023, equivalent to about 5% of forecasted demand for electricity then, the ministry said in an emailed statement.

In addition to the shortfall, many energy projects in Vietnam have been facing long delays, the ministry told Reuters.

“Developers are facing difficulties securing sufficient funds from local sources, and the government has limited its guarantee for foreign loans,” the ministry statement said.

According to Reuters, Vietnam will need an average of $6.7 billion a year to expand its annual power generation capacity by 10% between 2016 and 2030, it added.

“This is a big challenge, given that current electricity prices in Vietnam are barely enough for the developers to make a profit,” the statement said.

Vietnam’s foreign reserves hit record high $68 billion

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Việt Nam’s foreign reserves hit a record high of US$68 billion at the end of June, revealed a report from the HCM City Banking University.

According to the report, foreign investment capital inflows have helped the country build up its foreign reserves to double the figure of three years ago.

The sufficient foreign reserves have been a key source to help the central bank stabilise the USD/VNĐ exchange rate, the report noted.

The reserves would continue to be used for active intervention to the monetary market, ensuring currency stability, which suggests the Vietnamese đồng is likely to see minimal volatility over the coming months.

Both international and domestic experts have forecast the đồng to remain broadly stable against the greenback over the near term, supported by robust FDI inflows and foreign borrowing by domestic banks.

According to analysts from Fitch Solutions, the đồng will weaken only slightly over the remainder of 2019. In a report released last week, the analysts also revised their 2019 average forecast to VNĐ23,300 per US dollar, from VNĐ23,440 per dollar in April, in light of the unit’s stability over the first quarter of 2019.

Meanwhile, analysts from Saigon Securities Incorporation said as that there are not many changes in the international market and the supply and demand of foreign currency in the local market is balanced, the USD/VNĐ exchange rate will remain stable, fluctuating at around VNĐ23,200 per dollar.

The đồng has remained stable against the dollar at around VNĐ23,200 per dollar since April and has averaged VNĐ23,250 per dollar in the year to date.

The experts attributed the stability to an expectation that foreign direct investment (FDI) inflows would remain strong in 2019. Given US-China trade tension is unlikely to dissipate in the near future, it is expected that businesses with supply chains concentrated in China are likely to continue diversifying across the rest of Asia. Việt Nam will continue to benefit from this shift in supply chains due to its investment and trade friendly policies, and its low cost, young and large labour force.

In the long-term outlook, Fitch forecast the đồng to persist on a depreciatory trend against the US dollar due to higher inflation in Việt Nam versus the US and the đồng’s overvaluation.

“We forecast the unit to average VNĐ23,475 per cent in 2020, slightly weaker versus our 2019 forecast,” Fitch analysts said.

Source: VNS

How many airlines should Vietnam have?

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The move by Vingroup to establish Vinpearl Air once again shows the attractiveness of the domestic aviation market.

Vietnam now has five air carriers which provide commercial flights, namely Vietnam Airlines, Vietjet, Jetstar Pacific, Vasco and Bamboo Airways. Other legal entities in the aviation industry have been established and are following necessary procedures to obtain licenses, including Thien Minh, Vietstar, Vietravel Airlines and Vinpearl Air.

Vietnam Airlines reported combined revenue of VND102 trillion in 2018 and pre-tax profit of VND2.8 trillion. The figures were VND53.577 trillion and VND5.816 trillion, respectively, for Vietjet. Jetstar Pacific had revenue of VND5.816 trillion and reportedly began making profits after a period of difficulties.

However, the massive opening of airlines has made many of the 22 airports throughout the country overloaded. Tan Son Nhat in HCMC, Noi Bai in Hanoi, Da Nang, Phu Quoc and Cam Ranh are typical examples.

According to CAAV, Vietnam’s air carriers have developed 48 domestic air routes. The backbone air route of Noi Bai – Tan Son Nhat alone, called the ‘golden route’, has 61 flights a day.

Vietnam is planning to build Long Thanh Airport in Dong Nai and the first phase of the airport development alone will be equal to the cost of Tan Son Nhat Airport.

According to CAAV, Vietnam’s air carriers have developed 48 domestic air routes. The backbone air route of Noi Bai – Tan Son Nhat alone, called the ‘golden route’, has 61 flights a day

The number of aircraft increased from 60 in 2008 to 197 as of the end of June 2019.

The Ministry of Transport confirmed that it has not granted licenses to some airlines because they had chosen overloaded airports as bases, and they mostly wanted to operate golden air routes such as Noi Bai – Da Nang – Tan Son Nhat.

Meanwhile, the ministry has encouraged airlines to exploit other routes and consider local airports as base airports. Bamboo Airways, which has just joined the aviation market, for example, chose Phu Cat Airport in Binh Dinh province as a base airport. Vietravel Airlines chose Phu Bai Airport and Thien Minh chose Chu lai Airport in Quang Nam.

Bamboo Airways in May announced it has stopped providing flights on two routes, Vinh – Hanoi and Hai Phong – Can Tho, after only half a month of exploitation.

Prior to that, in February 2019, another airline stopped its Thanh Hoa – Nha Trang and Vinh – Pleiku routes because of ineffective operation.

According to Duong Tri Thanh, chair of Vietnam Airlines, low-cost carrier (LCC) development is a trend worldwide. While it will continue to develop Vietnam Airlines into a 5-star airline, it will also focus on developing Jetstar Pacific, an LCC.

Source: VNN

Online advertising seeing handsome growth in Vietnam

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Improving measuring tools for ad scalability and hosting proper internet infrastructure will drive growth in Vietnam’s online advertising market, according to latest Ken Research analysis.

The online advertising market in Vietnam recorded progressive growth during the 2013-2018 period, according to Ken Research, when the advertising industry overall experienced a decline in revenues. The market witnessed a slight slowdown in spending during 2016 owing to the financial crisis and the fall of the Vietnam Dong (VND) against the USD. This resulted in several brands opting to cut-down on their advertising costs to maintain net revenues.

The development of internet and digital infrastructure has begun to outstrip traditional advertising in terms of better customer penetration and conversion, as a result of better monetization and availability of developed ad reach measurement tools.

Internet penetration has advanced, with the number of users reaching 64 million in 2018. Vietnam’s 4G connection (averaging 21.49 Mbps) has been recognized as being faster than in the US (averaging 16.31 Mbps) and most of Southeast Asia. The exponential increase in social media usage has also contributed, with approximately 50 million users accessing social media content in 2018.

Research observed that Vietnamese people spend maximum time on travel and tourism websites, apparel and accessories shopping, banking and finance services, food delivery apps, healthcare services, and apps offering leisure activities. Social media advertising is one of the most preferred online advertising techniques in the country.

The major social media apps used in Vietnam include Facebook, Facebook Messenger, Zalo, Skype, Instagram, Whatsapp, and Viber, for text messaging, video calling, online shopping, and making online payments.

FMCG is the one of fastest-growing sectors in the country in terms of ad spend, with growth tightly connected to rising disposable incomes and a booming e-commerce industry. Vinamilk, Tan Hiep Phat (Dr Thanh), Nutri Food, Pepsi Co, and Coca Cola are some of the brands spending highly on online advertising in Vietnam. The second-largest sector in digital advertising is healthcare, which held a market share of almost 15 per cent in 2018. The industry primarily focuses on creating customer awareness about medical services and devices with low switching costs and for customer retention. CVI Pharma, Pfizer, Cipla, FV Hospital, and Pharmedi are some of the brands spending highly on online advertising in Vietnam in the healthcare segment.

Moreover, advertisers are interested in paying for advertisement campaigns based on actual results, hence pricing models, Cost per Click (CPC), and Cost per Action (CPA) becoming more popular in recent years. The Cost per Mille (CPM) model allows the publisher to know the expected revenue per impression and had catered to the rise in demand for the CPM model in Vietnam for brands looking to increase customer awareness of their products and services. CPM accounted for a little less than half of the market share in 2018 primarily because of the low financial risk offered. In this model, the advertiser needs to pay the publisher each time the advertisement is displayed, irrespective of whether the customer has noticed it or not.

Major advertising agencies in the country include big names such as GroupM, Publicis, DMV, FPT Online, Dentsu, CleverAds, Adtima, Mirum Agencies, and many more. Agencies are in a continuous process of developing new strategies and identifying creative ways to present an ad before users. The launch of new advertising technologies including programmatic advertisements, improved targeting strategies, involving tools to increase the reach of advertisements by various publishers, and the better use of ad inventory will aid the online advertisement market. The use of geo-targeting will facilitate higher conversion rates for advertisers. The development of data management platforms for collection and better analyzing big data and the use of newer and efficient technologies for better customer targeting would lead to substantial growth in the coming five years.

According to a study by Ken Research, one of the biggest challenges faced by entities is to gain clarity on circulars guiding tax regulations on how expenses spent on online advertising across various platforms need to be claimed as tax deductibles. Various businesses may not be able to claim the same advertising expense owing to lack of supporting documents such as contracts signed with Facebook or invoices issued from the social networking service company.

As a result, tax authorities may view this as a personal expense, as the bank statement of the credit card is issued under the name of the employee. Moreover, efforts need to be taken towards improving Cyber Security and Data Privacy. The prime reason for the dominance of traditional modes of advertising is because people are skeptical about their personal data being used. Hence, internet service providers must use proper equipment and software to protect systems from being hacked. All of these measures would together boost growth in the market over the next 5-10 years.

Source: Vneconomictimes