VIETNAM BUSINESS NEWS NOVEMBER 3/2023

Small scale, limited production level and operation capacity are barriers that create difficulties in deploying sales of businesses and cooperatives in localities on digital platforms.

Along with that, logistics infrastructure, transportation and delivery costs account for a large proportion, from 20-30 per cent, sometimes even up to 40 per cent, which is also creating considerable pressure in bringing agricultural products to the e-commerce floors.

Cooperatives have focused on production, trying to create products that meet the quality standards in recent times, but have not really invested in human resources for the development of e-commerce, according to Vũ Quang Phong, general director of the Trade and Investment Promotion Centre under the Việt Nam Cooperative Alliance.

Meanwhile, this is an inevitable trend in the digital transformation process that is strongly promoted by a segment of young consumers, but there is still a relatively large gap for the elderly who have not kept up with the pace of technology development.

The Vietnam News Agency quoted Phong as saying that competition on e-commerce platforms is inevitable. However, due to many difficulties in scale and capital, cooperatives do not know how to invest in human resources and build marketing and advertising campaigns, so they need systematic support.

Cooperatives and farmers need to have an innovative mindset to be able to take full advantage of the benefits of e-commerce.

Doing business through e-commerce platforms does not just stop at harvesting and selling, but requires investment in packaging, logistics, transportation or making promotional images to improve methods of production and develop business in an optimal way.

Although online business was no longer unfamiliar, in reality, for production, business establishments, and farmers, to bring agricultural products to e-commerce platforms was still very small and modest, said Bùi Huy Hoàng, deputy director of the Centre for Information and Digital Technology, Việt Nam e-Commerce and Digital Economy Agency (iDEA), under the Ministry of Industry and Trade (MoIT).

Difficulties come from limited awareness and resources of businesses for this business method, according to Hoàng. Most businesses and cooperatives producing and trading agricultural products still lack human resources knowledgeable about information technology, sales processes, and marketing.

Besides, registering a store and posting products on e-commerce stores is something businesses can do. However, in order for products to reach consumers, businesses need to be properly guided and trained on how to promote online, build product images and implement product packaging and preservation processes, or customer care methods, after-sales services.

As one of the provinces and cities with a high e-commerce index, the Cửu Long (Mekong) Delta city of Cần Thơ technology trading floor has become one of the useful information channels for searching and offering products for businesses and cooperatives in the area.

In particular, the city has supported and guided hundreds of businesses and cooperatives to participate in online trading platforms such as Tiki, Lazada, Voso, Sendo, Shopee, Postmart.vn to promote agricultural and rural digital economy; organise training for businesses, cooperatives, production and business establishments, and households to bring products to e-commerce platforms.

Up to now, many provincial OCOP products have been supported and guided to be listed on major e-commerce platforms.

However, according to representatives of cooperatives, with large-scale sources of agricultural products, cooperatives are supplying traders and distribution systems, but do not know how to start on e-commerce platforms.

A representative of the Cần Thơ City Cooperative Alliance said that the connection and consumption of goods between manufacturers, farmers and distributors only took place through traditional methods before.

Furthermore, most cooperatives only produce and farm mainly on a small scale, lacking the connection to create key products. It is the technical barriers, regulations, and product standards that make linking and connecting to consume goods difficult, according to the representative.

Similarly, representatives of a number of cooperatives and cooperative groups in the Mekong Delta province of Đồng Tháp also said that although they had put agricultural products on the e-commerce platform, due to small-scale business, limited financial capacity, information technology investment and application of e-commerce applications of cooperatives had not been as expected.

Notably, the agricultural products of these cooperatives are mostly daily foods and are sold by many units, making it difficult to compete, according to the cooperatives.

Therefore, the cooperative’s goods are displayed on the e-commerce platform mainly for customers to learn about products and compare prices.

On the other hand, the majority of members of cooperatives, especially agricultural cooperatives, are in their 40s and 50s, and are even disabled people, so the ability to apply information technology has not yet been popular.

In the initial steps of implementation, cooperatives also encountered a number of problems such as a lack of qualified human resources on e-commerce, so there was a situation where agricultural products were brought on the floors, but maintaining virtual booths and reaching customers is still ineffective.

To overcome difficulties for Vietnamese agricultural products when participating in e-commerce platforms, the iDEA has been continuing to co-operate closely with e-commerce platforms, connect partners with businesses to implement training programmes for businesses.

In addition, the MoIT also coordinates with provinces, localities, as well as e-commerce platforms to train cooperatives and business households to master technology and change production and business models to adapt to the new commercial trends.

Along with that, training programmes for opening stalls, operating and fulfilling orders, managing logistics, and managing product quality on major e-commerce platforms are organised in a methodical manner.

Recently, the MoIT has implemented a series of e-commerce connection programmes combined with e-commerce training and coaching in a number of provinces and cities, especially, promoting regional connectivity and links to consume agricultural products, food, and local specialties through e-commerce.

With the advantage of e-commerce to help operate the consumption of goods throughout provinces and cities through the e-commerce delivery system, agricultural products and local specialties have been promoted in many provinces and cities.

The MoIT will continue to implement cross-border e-commerce co-operation programmes with major international partners/e-commerce platforms such as Amazon, Alibaba, JD, Sea Group to promote cross-border e-commerce.

Through these co-operation programmes, Vietnamese specialty products such as processed agricultural products, handicrafts, consumer industrial goods, which are products with export strengths of the country, will be boosted via e-commerce.

In addition, the MoIT also built an e-commerce platform unifying 63 provinces and cities at sanviet.vn to connect and create a support platform for both sellers, buyers and digital platforms in providing goods, connecting services, creating conditions for developing the e-commerce market in a competitive and transparent manner, thereby, gradually building a centralised online retail database from central to local levels and helping final consumers buy quality products at reasonable prices. 

Quality–based branding of fruits and vegetables to tap opportunities of UKVFTA for export expansion

Quality and brand are recognised as decisive factors for Việt Nam’s fruits and vegetables to tap the opportunities from the UK – Việt Nam Free Trade Agreement (UKVFTA) and expand export to this highly demanding market, said Đặng Phúc Nguyên, General Secretary of Việt Nam Vegetable and Fruit Association (Vinafruit).

Under the UKVFTA, 100 per cent of tariffs on fresh and processed fruits and vegetables were eliminated on January 1, 2021.

The trade deal helped increase Việt Nam’s export of fruits and vegetables to the UK significantly in the past two years despite falling consumption demand among British consumers due to the impacts of economic slowdown and inflationary risk, Nguyên said.

He cited statistics that Việt Nam exported US$20.9 million worth of fruits and vegetables to the UK in 2022, registering an increase of 8 per cent against 2021 and accounting for 10 per cent of the total fruit and vegetable export to Europe.

In the first half of this year, the export of fruits and vegetables to the UK increased 28.3 per cent to $11.48 million.

According to Việt Nam Industry and Trade Information Centre, fruits and vegetables were the 20th largest export product category to the UK in January – July, accounting for 0.46 per cent of the country’s total export turnover.

Recently, several fruit specialties of Việt Nam have been brought to supermarket shelves in the UK such as Diễn pomelos, Tân Lạc red pomelos and Cao Phong oranges.

The expansion of Vietnamese fruits and vegetables to the UK market has demonstrated that the country’s production capacity of farm produce is improving in terms of quality, as the UK is a very demanding market with high requirements for food hygiene and safety.

Enjoying tariff liberation under the UKVFTA, many Vietnamese fruit and vegetable products being imported to the UK have competitive advantages against those of Thailand, Malaysia and Brazil, which have not had bilateral trade agreements with the UK.

Still, Việt Nam held a modest share of the fruits and vegetables market in the UK, which imports from around 100 countries, Nguyên said.

The Industry and Trade Information Centre’s statistics showed that the UK’s import of fruits and vegetables from Việt Nam accounted for less than 0.1 per cent of its total import value.

One of the causes for modest presence of Vietnamese fruits and vegetables in the UK market was the lack of national, corporate and product brands, Nguyên pointed out.

Many products were being exported to the UK under British brands or foreign brands, Nguyên said, adding that there were not many enterprises from Việt Nam with huge production capacity and reputed brands participating in this market.

He said building brands for Vietnamese fruits and vegetables in the UK market became vital for the industry to be able to tap the opportunities from the UKVFTA.

Enterprises were aware of the important role of brand building to expand in the UK but there was still a lot of work to do, Nguyên said.

The UKVFTA together with other new – generation FTAs were bringing huge opportunities for Việt Nam to build brands and diversify markets for fruits and vegetables.

Although Việt Nam’s fruits and vegetables export was poised to set a new record high this year, at around $5 billion after reporting an increase 72 per cent to reach $4.2 billion in January – September, diversifying markets was important for the industry as Việt Nam remained dependent on the Chinese market for 65 per cent of the fruits and vegetables export.

According to the Import – Export Department under the Ministry of Industry and Trade, to take advantage of the FTAs, the most important thing is to build brands in the processing ecosystem coupled with green production, which will help both increase added value and overcome barriers for market entry.

An estimation by the Ministry of Agriculture and Rural Development shows that more than 70 per cent of fruits and vegetables of Việt Nam were exported fresh or simply processed.

Meanwhile, the demand for processed food is increasing globally.

According to market insight by Statista, revenue in the processed and frozen fruit market amounts to $64.54 billion in 2023. The market is expected to grow annually by 7.19 per cent in the 2023-28 period.

There are about 150 plants grown for fruit and vegetable processing using modern technology in Việt Nam, with a total capacity of processing nearly 1.1 million tonnes per year, or just around 10 per cent of the country’s total fruit and vegetable output.

Nguyễn Quốc Toản, Director of the agriculture ministry’s Centre for Digital Transformation and Agricultural Statistics, said that besides fresh products, the fruit and vegetable industry should invest in processing to increase added value and diversify products to better meet global consumer demand.

Policies should be raised to encourage the establishment of value chains for fruits and vegetables as well as attracting investments in deep processing and applying modern technology in production, said Nguyên.

Việt Nam should build brands for fruits and vegetables based on quality, he stressed.

With the UKVFTA, Việt Nam was having advantages in exporting fruits and vegetables to the UK, Nguyên said.

For market entry and expansion in the UK, Vietnamese fruits and vegetables must meet requirements of food hygiene and safety. Besides, the UK also set standards for green production.

Nguyên urged enterprises to firstly study British consumer tastes to develop strategies to expand into this market. British consumers were highly demanding for product quality, design, taste, origin traceability and issues related to environment protection and sustainability.

Building growing areas that meet requirements for export to the UK was important. Besides, crop varieties must also be improved to produce products that meet consumer tastes.

Enterprises must also invest in processing, preservation and packaging technologies so that Vietnamese fruits and vegetables could be brought around the world without worries about impacts on quality.

Nguyên also urged trade promotion to be enhanced to help Vietnamese firms find customers and partners in the UK.

The Government should issue policies to encourage enterprises to invest in processing and apply modern technology in production to meet the requirements of the UK market, Nguyên said. 

Food, beverage businesses flexibly adjust year-end supply strategies to overcome challenges

Although most businesses believe that the food and beverage industry market will improve in the remaining months of this year, 15.4% of respondents in a recent survey of Vietnam Report think that the industry will face more difficulties.   

In the survey, 84.6% of food and beverage businesses said the global economic recession is the greatest challenge for them this year, and 76.9% were worried about declining purchasing power.

To overcome difficulties and promote production and business, food and beverage firms are making flexible adjustment in product supply and after-sales service. 

They also strive to diversify supply sources, invest in building brand images and marketing, and redesigning customer loyalty programmes. At the same time, they also seek to expand to adjacent markets and apply IT in business administration.

Vo Trung Hieu, Director of International Business Vinamilk, said that the company continues to proactively change its operating methods, increase investment in equipment, focus on training and developing human resources, and adopt digital and green transformation to adapt to new conditions. 

Regarding New Zealand and Australia – the two countries that have high environmental requirements, Vinamilk is working towards using HDPE packaging, which is easy to recycle, for all of its products exported to these two markets before 2025, he said. Hieu went on to say that currently, export products supplied to New Zealand and Australia do not have attached plastic straws and the lids are easier to open to minimise discharging plastic waste into the environment.

Vinamilk has recorded a two-digit growth in revenue in the Australian market.

General Director of Vietnam Report Vu Dang Vinh is optimistic about the growth prospect of the food and beverage industry, explaining that the State Bank of Vietnam has lowered lending interest rates for four consecutive times, thus helping many businesses in the industry reduce borrowing costs and increase access to capital as well as promoting their production and development of distribution channels. 

Another growth driver of the sector is the rising number of foreign tourists coming to Vietnam in recent month, pushing up the consumption of food and beverage.  

The shift in consumption trend from traditional to modern retail channels also has a positive impact on growth for the food and beverage industry, Vinh said, adding that a survey conducted by Vietnam Report revealed that the majority of consumers in big cities shop for food and beverages through modern channels, with 87.1% buying at supermarkets and shopping centres, 88.7% purchasing online and 59.1% at convenience stores.

This year, the proportion of food and beverage companies maintaining revenue growth has decreased across most distribution channels. However, the e-commerce channel continued to demonstrate relatively stable growth compared to the overall market and is the only channel that did not report a revenue decline. Up to 90% of companies with e-commerce operations said they posted revenue growth compared to the same period last year.

Long Son container port No. 3 expected to bring benefits to Thanh Hoa province

With a desire to become an important marine infrastructure not only to Nghi Son Economic Zone of Thanh Hoa province but also to the whole north central region, the construction of Long Son container port No. 3 is expected to become an advanced shipping port of the country.

Vice Chairman of the Nghi Son township People’s Committee Mai Sy Lan said that when the Long Son container port project is put into operation, it will directly create jobs for about 500 workers, promoting industries and seaport services, contributing to the socio-economic development of the locality in particular and Thanh Hoa province in general.

According to Long Son Limited Company, the contractor of the project, the project has total investment of 752 billion VND (30.6 million USD). It is expected that the project will be completed in October 2025.

When put into operation, in addition to meeting the needs of import and export goods loading and unloading of businesses, industrial parks in the province and surrounding areas, the port will also become an ideal destination, attracting more new shipping lines to Nghi Son port, thereby increasing budget revenue for Thanh Hoa province, creating more jobs for labourers.

In addition to prioritising recruitment of labourers from Hai Ha commune, the Long Son Limited Company will also regularly deploy welfare activities such as supporting households of people with meritorious services to the revolution in Hai Ha commune on the occasion of holidays, Tet; support poor households and families in difficult circumstances affected by the project. The company will also provide teaching and learning equipment for schools in Hai Ha commune.

Recently, the company has coordinated with the Hai Ha Commune People’s Committee to present 142 scholarships to pupils and students from impoverished households in the commune with total budget of nearly 300 million VND, thereby encouraging students to strive to overcome difficulties and obtain outstanding academic achievements.

CABC leader views Vietnam as important trading partner of Canada

Vietnam is an important trading partner of Canada in the Association of Southeast Asian Nations (ASEAN), and this will open up chances for stronger cooperation between the two countries to expand Canadian goods and services’ presence in Asia, said co-chair of the Canada – ASEAN Business Council (CABC) Janet De Silva.

ASEAN holds the central part of the Indo-Pacific Strategy of Canada. The two sides elevated their ties to a strategic partnership and are promoting the signing of a free trade agreement (FTA). The North American nation forecast the bloc will account for half of the global GDP before 2040.

Addressing a recent event held in Toronto by the CABC, De Silva said ASEAN, one of the regions with the strongest development in the world, is focusing on economic growth and climate transition initiatives. It is currently the world’s fifth largest economy and emerging as a new global centre for trade, exchanges and innovation. Meanwhile, Canada has technological strength and businesses able to contribute to these initiatives.

She highlighted Vietnam as an important ASEAN partner of her country in terms of trade and agriculture, noting that the two countries’ cooperation will not only help increase the size of the Vietnamese economy but also develop the Canadian economy.

Vietnam has been a good and important partner of Canada in ASEAN over the last 50 years, being the biggest trading partner of the North American country in the bloc. The country posts an average economic growth rate of 7% for the last 30 years, and is considered a gateway for Canadian firms to develop in this region, according to the official.

Noting the recent successful trip to some Asian countries, including Vietnam, Minister of Economic Development, Job Creation and Trade of Ontario Victor Fedeli told the Vietnam News Agency that trade between Vietnam and Canada could be further boosted by capitalising on their comprehensive partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Vietnam is one of the 10 biggest trading partners of Canada thanks to the CPTPP, with bilateral trade growing 23% last year, he noted.

CABC President Wayne Farmer said the council is coordinating closely with the Vietnamese Government, the embassy and representative diplomatic bodies of the country in Canada to make a plan for next year that will include activities on energy transition, clean technology, exploitation of CPTPP, and the FTA that Canada and ASEAN are working to achieve.

The CABC is aware of the importance of bolstering ties with this region. With Canada’s recent commitments in many strategies, from the Indo-Pacific Strategy and the Canada – ASEAN strategic partnership to the two countries’ comprehensive partnership, the CABC is making more progress in enhancing the strategic partnership and support for Canadian businesses in Southeast Asia, he added.

The CABC, founded in 2012 by Canadian companies operating in ASEAN, is headquartered in Singapore and has an office in Montreal city.

Vietnam’s tourism sector earns 23.7 billion USD in ten months

Vietnam’s total revenue from tourists is estimated at 582.6 trillion VND (23.7 billion USD) in the first ten months of 2023, according to the Vietnam National Authority of Tourism.

In the period, the country welcomed 10 million foreign tourists, exceeding the target of 8 million for the whole year, and served 98.7 million domestic holiday-makers. In October alone, the tourism sector served 1.11 million foreign visitors and 5.2 million domestic tourists.

According to the nine-month socio-economic report announced released by the General Statistics Office, the service and tourism sector grew by 6.24%, contributing 53.34% of the total overall growth of the country’s GDP.

In November, localities across the nation have plans to organise various events and festivals to attract more tourists, including Hanoi Tourist Gift Festival, Ninh Thuan Tourism and Culture Day in Can Tho city, Ba Ria – Vung Tau Tourism Week, and Mang Den Culture Festival in the Central Highlands province of Kon Tum.

Travel companies in Vietnam are preparing to anticipate opportunities of the peak season of both inbound and outbound tours.

At present, the Republic of Korea, China, Taiwan (China), and Japan are widely sought after by tourists thanks to good tour prices. A representative of Saigontourist – one of Vietnam’s largest travel companies, said that tours with new destinations or offering new experiences are attracting tourists, many of whom are willing to spend large amounts of money to enjoy new experiences.

Nguyen Nguyet Van Khanh, a representative of Vietravel – also a major Vietnamese travel firm, stated that with some tours that draw attention by a large number of Vietnamese tourists, such as those to China, the company always proactively links and cooperates with tourism promotion agencies, and localities to step up promotion activities and introduce tours at good prices so as to bring many impressive experiences to customers.

Online travel platform Agoda on October 24 for the first time announced Vietnam’s New Horizons – a list of new emerging destinations in the country that few tourists have known.

The list is made based on the results of comparing search data for the same period in 2022 and 2023 about emerging destinations, increasing interest from both domestic and foreign tourists.

On the top of the list is Tam Dao resort in the northern mountainous of Vinh Phuc with search traffic increasing by 279% over the same period last year.

Other destinations are Bac Ninh – a spiritual city in the North with a 234% increase in search volume; Sam Son coastal city in the central province of Thanh Hoa, 228%; and Phu Quy – a small island off the coast of Binh Thuan province. The coastal city of Quy Nhon with its romantic beaches and unique cuisine is also included in the list.

Vu Ngoc Lam, Director of Agoda in Vietnam, said that in addition to the most popular and famous destinations in Vietnam which many tourists visit regularly, Agoda found that some places with fewer visitors had a clear increase in searches.

Agoda wants to take advantage of this opportunity to introduce new places and find out what attracts those who love to explore destinations that few tourists have come to.

He said Vietnam has many interesting things to explore, in which second- and third-class destinations are increasingly sought after. Therefore, Agoda regularly introduces many incentives to help tourists have the best experiences when travelling to Vietnam.

VFF recognised as professional class member in AFC’s coach training convention

The Asian Football Confederation (AFC) on October 31 officially presented a certificate recognising the Vietnam Football Federation (VFF) as a professional class member in the AFC’s coach training convention.

The result has shown countless efforts of the VFF in training coaches at all levels of the AFC with important contributions of technical directors and support from AFC experts.

Before being recognised as a professional class member of the AFC, the VFF was qualified as a class A member in 2021 and had the right to organise the AFC’s A, B, C certification training courses.

The AFC’s current professional federations include Australia, China, the Republic of Korea, Japan, Qatar, Jordan, Uzbekistan and Vietnam.

Becoming a member of the AFC professional class – the highest class, means that the VFF can independently organise coach training courses at all levels, from C-level courses to Pro courses in the AFC coach training system. The certificates of coach training courses organised by the VFF are valid throughout Asia.

Besides, the VFF has also been a 3-star member (the highest ranking level) of the AFC’s senior youth football development programme (AFC Elite Youth Scheme) since 2020.

Petrol up, oil down in latest price adjustment

The retail prices of petrol were revised up while those of diesel, kerosene and mazut were lowered from 3pm on November 1 by the Ministry of Industry and Trade, and the Ministry of Finance.

The price of E5 RON 92 bio-petrol rose by VND249 to VND22,614 per litre, while the price of the most popular petrol – RON95 – climbed by VND416 23,929 per litre.

Meanwhile, prices of diesel 0.05S and kerosene were not higher than VND21,940 per litre and VND22,305 per litre, down VND549 and VND448, respectively.

The price of mazut decreased by VND373 to VND16,240 per kg.

Since the beginning of the year, the domestic petrol price has undergone 31 adjustments with 18 times up, 9 down, and 4 unchanged.

Number of newly-established firms up 21.7% in October

Vietnam saw over 15,400 newly-established enterprises with total registered capital of 125.8 trillion VND (5.1 billion USD) and a registered workforce of 131,600 in October, up 21.7% in the number of firms, 7.4% in capital and 64.3% in the number of labourers over the previous month, according to the General Statistics Office (GSO).

The country recorded 131,800 new firms in the first ten months of this year with combined registered capital of over 1.21 quadrillion and 880,000 labourers, it said.

The figures represented increases of 4.7% in the number of firms and 5.4% in the workforce but fell 12.1% in registered capital compared with the same period last year, the GSO said, adding that the average capital of new enterprises in the period was 9.2 billion VND.

The number of enterprises resuming operations in during the period was 51,900, a year-on-year decline of 1.5%.

Meanwhile, 81,000 enterprises temporarily ceased operations, up 22.1% against last year’s same period. Some 50,700 businesses stopped operations, waiting for dissolution procedures, a year-on-year rise of 25.9%, and 14,700 enterprises completed dissolution procedures, down 4.5%. On average, 14,700 businesses withdrew from the market every month.

From January to October, 1,427 newly-established enterprises operated in the agriculture, forestry and fishery sectors, down 15.3% over the same period last year; over 31,300 firms in the industrial and construction sectors, up 0.8%; and 99,000 in the service sector, up 6.4%.

The increase in the number of newly-established industrial enterprises reflected that industrial production continued to flourish after suffering negative growth for many months. It also showed that the measures to assist businesses of the Government, the Ministry of Industry and Trade and other ministries and agencies have brought about positive effects.

Deputy Minister of Industry and Trade Do Thang Hai suggested industry and business associations proactively guide enterprises in building strategies, production and business plans that are relevant to the needs and capabilities of each unit as well as transform production and business in accordance with market trends, especially shifting to green and sustainable exports.

He noted that businesses must strictly and fully comply with state regulations and policies, ensuring traceability of origin and requirements of foreign markets.

They should take full advantage of opportunities and recovery trends of markets to boost exports, Hai added.

Hanoi’s ten-month CPI increases by 1.51% y-o-y

Hanoi’s consumer price index (CPI) in the first ten months of 2023 increased by 1.51% year on year, the municipal Statistics Department has reported.

According to the department, nine of the 11 groups of goods and services saw price hikes in the January-October period, including beverage and tobacco, up 3.45%; restaurant and catering services 3.23%; apparel, headwear and footwear 1.68%; culture, entertainment and tourism 1.55%; housing, electricity, water, and construction materials 1.37%; equipment and home appliances 0.94%; education 0.37%; medicine and health services 0.34%; and other goods and services 4.25%.

In the period, prices declined in two categories – transportation down 2.38%; and postal and telecommunications services down 0.62%.

In October alone, the city’s CPI rose by 0.09% from the previous month and surged by 4.16% as compared to the figure in the same period last year.

Seven out of the 11 groups of goods and services witnessed price increases from the previous month, including the categories of housing, electricity, water, and construction materials; restaurant and catering services; culture, entertainment and tourism;  apparel, headwear and footwear; beverage and tobacco; medicine and health services; and other goods and services.

Hanoi has introduced numerous programmes to bolster tourism development and stimulate consumption in order to contribute to the capital city’s socio-economic development.

Food, beverage businesses flexibly adjust year-end supply strategies to overcome challenges

Although most businesses believe that the food and beverage industry market will improve in the remaining months of this year, 15.4% of respondents in a recent survey of Vietnam Report think that the industry will face more difficulties.   

In the survey, 84.6% of food and beverage businesses said the global economic recession is the greatest challenge for them this year, and 76.9% were worried about declining purchasing power.

To overcome difficulties and promote production and business, food and beverage firms are making flexible adjustment in product supply and after-sales service. 

They also strive to diversify supply sources, invest in building brand images and marketing, and redesigning customer loyalty programmes. At the same time, they also seek to expand to adjacent markets and apply IT in business administration.

Vo Trung Hieu, Director of International Business Vinamilk, said that the company continues to proactively change its operating methods, increase investment in equipment, focus on training and developing human resources, and adopt digital and green transformation to adapt to new conditions. 

Regarding New Zealand and Australia – the two countries that have high environmental requirements, Vinamilk is working towards using HDPE packaging, which is easy to recycle, for all of its products exported to these two markets before 2025, he said. Hieu went on to say that currently, export products supplied to New Zealand and Australia do not have attached plastic straws and the lids are easier to open to minimise discharging plastic waste into the environment.

Vinamilk has recorded a two-digit growth in revenue in the Australian market.

General Director of Vietnam Report Vu Dang Vinh is optimistic about the growth prospect of the food and beverage industry, explaining that the State Bank of Vietnam has lowered lending interest rates for four consecutive times, thus helping many businesses in the industry reduce borrowing costs and increase access to capital as well as promoting their production and development of distribution channels. 

Another growth driver of the sector is the rising number of foreign tourists coming to Vietnam in recent month, pushing up the consumption of food and beverage.  

The shift in consumption trend from traditional to modern retail channels also has a positive impact on growth for the food and beverage industry, Vinh said, adding that a survey conducted by Vietnam Report revealed that the majority of consumers in big cities shop for food and beverages through modern channels, with 87.1% buying at supermarkets and shopping centres, 88.7% purchasing online and 59.1% at convenience stores.

This year, the proportion of food and beverage companies maintaining revenue growth has decreased across most distribution channels. However, the e-commerce channel continued to demonstrate relatively stable growth compared to the overall market and is the only channel that did not report a revenue decline. Up to 90% of companies with e-commerce operations said they posted revenue growth compared to the same period last year.

India explores investment opportunities in Long An

Vice Chairman of the People’s Committee of Long An province Huynh Van Son on November 1 received Indian Consul General in Ho Chi Minh City Madan Mohan Sethi, who is on a trip to explore the investment environment of the Mekong Delta locality.

Sethi highlighted the close and long-lasting relations between the two nations, noting that the investment poured by Indian businesses into Vietnam has sharply surged annually over the last 20 years.
According to the diplomat, India has strengths in information technology, health care, and education, and it has an import demand for diverse goods.

Many Indian firms will join trade connection conferences in HCM City later this year, he revealed, expressing the hope that Long An’s businesses and relevant agencies will participate in these events, thus expanding cooperation opportunities and fostering partnerships.

India wishes to support and cooperate with Long An in terms of health care, education, and textile production, he said.

For his part, Son updated the guest on Long An’s potential, strengths, and incentive policies for investors, affirming that the provincial authorities are willing to accompany and create the most favourable conditions for businesses to invest in the locality.

He said he hopes the two sides will have more specific discussions on areas of cooperation, and that Indian companies will expand their investment in Long An in the coming time.

Vietnam’s export rice price reaches new peak

The prices of Vietnamese export rice have soared to the highest level ever, according to the Vietnam Food Association (VFA).

Vietnam’s 5% broken rice is traded 653 USD per tonne, up 10 USD per tonne, while the 25% broken rice is sold at a record high of 638 USD  per tonne.

They are much higher than those of Thailand and Pakistan. Specifically, 5% broken rice is valued at 560 USD per tonne in Thailand and 563 USD in Pakistan, and 25% broken rice at 520 USD in Thailand and 488 USD in Pakistan.

The VFA said there is ample room for Vietnamese rice exports as demand continues to climb across the globe. The Philippines wants to import additional 1.1 million tonnes of rice, while the demand from Indonesia is 2.3 million tonnes. China’s rice import is expected to surge in the end of the year.

Vietnamese exporters said rice price will continue its upward trend even in the fall-winter and winter-spring harvest seasons as global demand has increased over years while supply has tapered off due to climate change.

Boasting high-quality rice which has won the taste of foreign consumers, Vietnam could sell its rice at 640-650 USD per tonne in the end of 2023, they added.

Domestic rice prices have been on the rise as a result of increasing export demand, with the 5% broken grain sold at 15,343 VND (0.62 USD) per kilogramme, up 3,000 VND, while 25% broken one traded at 14,725 VND per kilogramme, up nearly 3,000 VND from July.

However, many rice traders said this poses a challenge for them since they find it hard to get sufficient volume of the ordered rice. They have been hesitant to sign new rice export contract for fear of loss.

Statistics from the General Department of Vietnam Customs, Vietnam gained 4 billion USD from shipping more than 7.1 million tonnes of rice abroad during January – October, up 35% in value and 17% in volume as compared to the same time last year.

The Ministry of Agriculture and Rural Development said Vietnam is able to export 7.8 million tonnes of rice, and earned 4.2-4.5 billion USD in export revenue in 2023.

Int’l retail tech, franchise expo opens in HCM City

The 14th Vietnam International Retail Tech and Franchise Show (VIETRF) 2023 kicked off on November 2 in Ho Chi Minh City.

The event brings together more than 250 domestic and foreign brands, introducing technology applications in retail operations, artificial intelligence, data analysis, digital assistants and robots, virtual reality (VR) technology, augmented reality (AR), among others.

Franchise brands are found in various fields such as beauty and healthcare, education, household services including household appliance repair and cleaning, human resource training and coaching, and financial services, among others.

Nguyen Phi Van, Chairwoman of Go Global Group said the franchising industry in Vietnam is becoming more vibrant than ever with a variety of industries participating in activities. The event is considered a good opportunity for the business community and investors to learn and meet new franchise brands in many new fields.

Several activities will also be held during the three-day event, including seminar series “Franchising 2023 – Improvisation and Development in Crisis”, updating domestic and foreign franchise market information for businesses, organisations and individuals.

In addition, when participating in the seminar series, visitors will have the opportunity to access new retail trends, as well as solutions to seize opportunities in the current economic period.

The event runs until November 4.

Vietnam int’l electronics, smart appliances expo opens

The Vietnam International Electronics & Smart Appliances Expo 2023 (IEAE Hanoi) opened in Hanoi on November 2. 

Jointly organised by the Vietnam National Trade Fair & Advertising Company (Vinexad), and Chaoyu Expo of China, the three-day event aims to boost partnerships between Vietnamese businesses and foreign firms, and the development of a high-quality electronic consumer market in the country.

Covering 10,000sq.m, this is one of the large-scale thematic exhibitions in Vietnam, which will feature tens of thousands of electrical and household electronic appliances, smart devices, computers, phones, accessories and game equipment, and electronic components, as well as other products from over 200 businesses and producers.

IEAE Hanoi is a “technology fest” for the Vietnamese electronics market in particular and the Southeast Asian market in general.

It encourages the consumption of high-quality electronic and entertainment products, while committing to building an efficient and professional “one-stop shopping” platform, providing a smart exhibition experience for buyers in Hanoi and across Vietnam.

Deputy Director of the Asia-Africa Market Department under the Ministry of Industry and Trade To Ngoc Son emphasised that Vietnam is a potential consumer market for many electronic products. Vietnam’s import turnover of phones, computers, electronic products, household appliances and components from the world in 2022 reached 105.2 billion USD, an increase of 6.2% compared to 2021.

Within the framework of the event, forums and seminars will be organised, focusing on the development of electronics, household electrics, and smart devices as well as solutions to promoting innovation and the development of these sectors.

Source: VNA/SGT/VNS/VOV/Dtinews/SGGP/VGP/Hanoitimes