Vietnam Needs Reform to Boost Growth: IMF Chief
Vietnam should carry out major macroeconomic reforms in order to lift growth and catch up with other economies, Christine Largarde, managing director of the International Monetary Fund (IMF), said Thursday in Hanoi at a meeting with students of the National Economics University.
The country should ensure its macroeconomics are stable by using flexible exchange rates to minimize the shocks created by global financial markets, and by using inflation as a decisive factor to develop monetary policies, she said.
Vietnam Firms Need Big Efforts to Grab Opportunities from TPP
The Trans-Pacific Partnership (TPP) agreement would bring opportunities for Vietnam, but they would not by themselves turn into benefits or market strength, Deputy Minister of Industry and Trade Tran Quoc Khanh said at a conference Thursday.
It would depend much on how Vietnam takes advantage of the pact and copes with related problems, and only with appropriate efforts would the country be able to achieve its potential and overcome challenges, Mr. Khanh added.
Steel Prices Surge in Vietnam ahead of Tariff Lift
Steel prices in Vietnam have been soaring before temporary safeguard measures recently announced against two types of steel imports into the Southeast Asian country, experts were quoted by the Vietnam News Agency as saying.
Domestic steel prices have reported an increase by 250,000 dong ($12) per metric ton. Currently, steel prices hover around 8.9 million dong ($397) to 9.0 million dong ($402) a ton.
The Ministry of Industry and Trade on March 8 announced additional tariffs on imported steel products as a temporary safeguard against inexpensive imports that were allegedly threatening the domestic industry. The new tariffs will take effect next week.
Beer Companies in Vietnam Seek Delay in Tax
Beverage companies seek to delay until the beginning of 2017 the application of amended regulations on calculating their special consumption tax, claiming they need more time to adjust their production plans.
According to two regulations which came into force just over two months ago, the special consumption tax on producers would be calculated based on the price that its member distributing company sold to sales agents and the taxable price must be lower than 7% compared to the agent’s monthly average end selling price.
Nguyen Van Viet, chairman of the Vietnam Beer Alcohol Beverage Association, said that the price gap being capped at 7% would cause administrative procedures to become more complicated for companies.
Vietnam Finance Ministry Eases Regulation on Tax Refund
The Ministry of Finance has asked local tax authorities to refund value-added tax to enterprises if the amount of tax they default on is less than the amount of tax refund that they will receive.
The ministry’s decision is in response to complaints about tax refund delays caused by tax agencies, which causes shortage in businesses capital sources.
Dream Incubator Snaps up 34% in Le & Associates
Japan’s PE firm Dream Incubator has acquired a 34% stake in Vietnam-based human resource service provider Le & Associates (L&A), the Deal Street Asia reported.
The two firms will jointly provide corporate management consultancy and BPO services, reaching more Japanese customers.
Prior to L&A, Dream Incubator has invested in four Vietnamese companies since its presence in the country in 2007, including Viet Nhat Medical Instrument, consumer goods company Mesa, pharmacy retailer Santedo and Nutifood (which it exited with an IRR of 50%).
Vietnam Shares Fall as Foreign Fund Refresh Holdings
The benchmark VN Index of the Hochiminh Stock Exchange dropped 0.59% to 575.82 Friday, which was the last day for foreign-run exchange-traded funds (ETFs) to restructure their portfolios, pushing up market liquidity.
Foreign investors net sold 151 billion dong ($6.74 million) worth of Vietnamese shares on the bourse, versus a net buying value of 204 billion dong ($9.1 million).
Non-performing loans (NPLs) at banks in Vietnam accounted for 2.55% of total outstanding loans in December 2015, compared to 3.25% at the end of 2014 and the lowest since 2010, according to data of the State Bank of Vietnam (SBV
) and Reuters.
The government-run National Financial Supervisory Commission (NFSC), meanwhile, earlier this week announced that NPLs were estimated at 120 trillion dong ($5.58 billion) at the end of last year, or 2.9% of total credit, down from 3.7% in late 2014.
Vietnamese commercial banks have cancelled forward contracts to purchase foreign currency from the State Bank of Vietnam (SBV), the country’s central bank, suggesting that they expect to buy forex in the market at softer prices, the Vietnam Economic Times reported.
SBV started to sell forex to banks for the first time on December 31, 2015, with the U.S. dollar priced for late March 2016 1% higher in comparison with the end of December. With such a move, the regulator seeks to drive the USD/VND rate to move less than 1%.
Vietnam will need some $148 billion to develop power generation plants and national grid from now to 2030, with more importance attached to renewable energy sources, according to a government plan.
The South Korean government has advanced interest in joining metro projects in Ho Chi Minh City, following the involvement of Japan, Germany and Spain, the Tuoi Tre (Youth) newspaper reported.
The Korean government, through the Korea International Cooperation Agency (KOICA), has provided $5 million to support the Vietnamese metropolis in conducting the feasibility study (F/S) of the second phase of 14.5-kilometer metro No. 5.