What to Note When Signing Labour Contract with Foreign Workers?

With the policy of opening the economy in Vietnam, not only Vietnam attracts investors to set up company, but also the demand for foreign workers in enterprises grows and diversifies. However, in order for Vietnam companies to be able to use foreign workers, they must sign a labor contract.

After meeting the conditions specified in the Labor Code on meeting the requirements for recruitment and working in Vietnam, the foreign worker working in Vietnam shall sign a labor contract before the expected date intend to work for the employer. In this contract, the employer and the foreign worker will agree on all issues arising in the process of working as well as using labor together.

Firstly, on the working position in the labor contract, it must show the correct position and position for which the employer has determined the needs with the competent authority and in accordance with the working position shown in the document and the work permits which have been granted to foreign workers.

Regarding the working time, it will normally be agreed upon by the two parties but must not exceed the number of working days (hours) as prescribed by Vietnamese law. The number of overtime hours must be based on voluntary work and must ensure rest time, rest during working time and weekends for foreign workers.

According to the provisions of the Labor Code, in addition to Vietnamese public holidays and New Year’s holidays, foreign workers are allowed to take one more day off for the national traditional New Year and one national day of the country. This is a humane regulation, respecting the national culture of Vietnam. Therefore, the employer needs to learn about the National Day and the traditional Tet holiday of foreign workers so that the employees can take leave in accordance with the provisions of the law.

Regarding the term of the labor contract, the term of the labor contract for foreigners is also governed by the duration of the work permit issued by the competent Vietnamese authority. Accordingly, the term of the labor contract for foreign workers working in Vietnam must not exceed the term of the work permit. Therefore, the employer should pay attention to conclude the contract term in accordance with regulations.

In addition, employers and foreign workers should be aware of the terms of disputes which could potentially arise. Because, contract terms are an important legal basis to resolve when a labor dispute arises, agreeing in advance on how to resolve a dispute when a dispute arises will create a clear legal foundation for easy settlement by both parties. Dispute lawyers are suggested to be consulted at an early stage to avoid dispute escalation.

At most, it is important that the employers and foreign workers need to pay attention and strictly comply with the provisions of the law so that the process of entering into and performing the contract is conducted smoothly and in compliance with the law in Vietnam.

Read More

An Additional of 60 FDI Projects Received Investment Licenses into Hanoi

According to Hanoi’s Department of Planning and Investment, in November, the city had 60 newly licensed FDI projects with a total registered capital of 600 million USD.

Of these, there are 52 projects with 100% foreign direct investment; 8 joint venture projects. Besides, there are 8 projects being adjusted to increase investment capital with the additional capital of 6.7 million USD.

Also, in November 2019, foreign investors contribute capital and buy stakes reach 72.9 million USD.

Notably, during the recent Prime Minister’s business trip to Korea, the leader of Hanoi People’s Committee awarded 4 investment policy decisions worth more than 400 million USD, signing the memorandum of understanding to invest in Hanoi worth more than 4 billion USD.

Accumulated from the beginning of the year to November 25th 2019, the total registered capital of newly established projects and additional capital increased projects reached 2,142 million USD, of which newly registered 788 projects with total capital of 1,562 million USD; 160 additional projects register to increase investment capital of 580 million USD.

In the first 11 months of 2019, foreign investors contributed capital, buying capital contribution reach 5,330 million USD.

Previously, in October 2019, Hanoi had 91 newly licensed FDI projects with a total registered capital of 468 million USD, of which 72 projects were 100% foreign direct investment, 19 joint venture projects. Of these, foreign investors contribute capital and purchase shares reach 5,330 million USD. The number of projects terminating, suspending and dissolution is 27 projects, of which 24 projects are 100% foreign direct investment and joint ventures are 3 projects.

Major projects from the beginning of the year until now have invested in Hanoi such as the capital contribution and share purchase project of Beerco Limited (Hong Kong) in Vietnam Beverage Co., Ltd., the value of the capital contribution is 3.85 billion USD with the main target of brewing and brewing malt in Hanoi. The project Meiko Electronics Co., Ltd. (Hong Kong) with the goal of designing, assembling and manufacturing electronic components in Hanoi adjusts to increase an additional of 200 million USD investment capital.

Hanoi together with many leading corporations in Japan also exchanged memorandums of understanding (MOUs) on investment cooperation in many projects in the city with a total committed investment capital of up to 3.75 billion USD.

In addition, the newly released data of Foreign Investment Agency (Ministry of Planning and Investment), in the first 11 months, the country has attracted nearly 31.8 billion USD of foreign investment, up 3.1. % compared to the same period last year.

Specifically, in 11 months, capital contribution and share purchase reached US $ 11.24 billion, up 47.1% over the same period in 2018 and accounting for 35.4% of the total registered capital. Meanwhile, both newly and increased capital decreased. Specifically, newly granted capital reached 14.68 billion USD, down 7%; additional capital reached US $ 5.87 billion, down 10.7% over the same period last year.

In addition, the newly released data of Foreign Investment Agency (Ministry of Planning and Investment), in the first 11 months, the country has attracted nearly 31.8 billion USD of foreign investment, increase by 3.1% compared to the same period last year.

Specifically, in 11 months, capital contribution and share purchase reached 11.24 billion USD, increase by 47.1% over the same period in 2018 and accounting for 35.4% of the total registered capital. Meanwhile, both newly and increase capital decreased. Specifically, newly granted capital reached 14.68 billion USD, decrease by 7%; additional capital reached 5.87 billion USD, decrease by 10.7% over the same period last year.

Read More

The Politburo First Issued Resolution on FDI Attraction

For the first time after 30 years of attracting foreign investment in Vietnam, the Politburo issued a thematic resolution to guide in the coming years.

On August 21st, General Secretary and State President Nguyen Phu Trong signed Resolution No. 50 on the orientation of perfecting institutions and policies, improving the quality and efficiency of foreign investment cooperation by 2030.

In the period from now until 2030, the guiding point emphasized by the Politburo is to attract FDI selectively, taking quality, efficiency, technology and environmental protection as the main evaluation criteria. At the same time, priority is given to projects with advanced technology, new technology, high technology, clean technology, modern management, high added value, spreading and connecting global production and supply chains.

In addition, the overall objective is to improve institutions and policies of foreign investment cooperation with high competitiveness and international integration. At the same time, basically overcome the limitations in building, completing and organizing the implementation of institutions and policies on foreign investment cooperation.

The Resolution of the Politburo also supplements the provision on the conditions for national defense and security in the process of considering and issuing investment registration certificates with new investment projects and investment activities through the form of capital contribution and purchase of shares.

The Politburo requires clearly defining the responsibilities of investors on environmental protection during the investment period, project implementation and operation of enterprises during the project implementation period. Along with these tasks, policies on investment management and supervision; innovation and efficiency improvement of investment promotion must be paid attention to.

The Politburo noted that the emphasis on inspection, supervision and inspection is associated with improving the responsibilities of local authorities and heads; definitely deal with projects that cause environmental pollution, inefficient land use and business losses for many years, the project does not comply with its commitments.

Statistics show that after nearly 30 years of receiving FDI capital, Vietnam has more than 23,000 FDI projects with a total registered capital of over 300 billion USD. In which, the total implemented capital is about 161 billion USD. Resolution 50 sets targets, registered capital in the period 2021 – 2025 is about 150 – 200 billion USD (30 – 40 billion USD a year); implemented capital of 100 – 150 billion USD. The period of 2026 – 2030, registered capital of 200 – 300 billion USD, implemented capital of 150 – 200 billion USD.

Percentage of enterprises using advanced technology, modern management, environmental protection, towards high technology increased by 50% in 2025 and doubled (100%) in 2030. Proportion of labor through training in the labor use structure from 56% in 2017 to 70% in 2025 and 80% in 2030.

Read More

British Investors Proposed to Invest in Wholesale Market in Gia Lai

Chairman of Gia Lai Provincial People’s Committee has just had a meeting and worked with Chairman of the Board of Directors of TKV Holdings International (United Kingdom), coming to survey and find out investment opportunities to set up business in Vietnam and in particular set up wholesale market project in Gia Lai province.

At the meeting, representatives of TKV Holding International Cooperation Joint Stock Company expressed their interest in building wholesale market; electronic portal of wholesale market without managers; strategic product identification; advising on the province’s strategic product identification in the global value chain (building national product images) and Gia Lai province’s product consumption plans.

The representative of the company also assessed that Gia Lai is a potential province and if implemented, the wholesale market model in Gia Lai will also have its own characteristics; At the same time, asking the province to provide additional issues related to regional planning and sector planning; local determination and orientation of Gia Lai province for the participation of enterprises in implementing this wholesale market model.

At the meeting, Chairman of Gia Lai Provincial People’s Committee Vo Ngoc Thanh also raised a number of issues for the unit to learn investment such as the project scale of the wholesale market, the need to connect between the wholesale market and the people. production if the model is deployed in Gia Lai.

Chairman Vo Ngoc Thanh expects TKV Holdings International Cooperation Joint Stock Company will soon agree with the province on how to do as well as speed up the implementation plans of this project. At the same time affirmed Gia Lai’s determination and will create favorable conditions for the unit through the Department of Planning and Investment to promote investment in implementing the wholesale market project in Gia Lai province in the early period. Best.

At the meeting, Chairman of Gia Lai Provincial People’s Committee also raised a number of issues for investors such as the project scale of the wholesale market, the need to connect between wholesale market and producers if the model is implemented in Gia Lai.

Chairman of the province expects TKV Holdings International Cooperation Joint Stock Company will soon agree with the province on how to do as well as speed up the implementation plans of this project. At the same time affirmed Gia Lai’s determination and will create favorable conditions for the unit through the Department of Planning and Investment to promote investment in implementing the wholesale market project in Gia Lai province in the shortest time.

Read More

Quang Ninh Calls for Investors in Tourism Real Estate

Quang Ninh is becoming an open destination for tourism investors to come and set up business in Vietnam.

With the land area and sea surface of over 12,000 square kilometers, the topography of more than 2,000 islands spread over 250 kilometers of coastal lines, Quang Ninh is considered as a “small Vietnam” with the potential to develop green tourism. Therefore, it is not surprising that many travel experts perceive Quang Ninh is blessed with special values.

The first highlight of the Quang Ninh tourism journey is Ha Long Bay – the world natural heritage, the most typical and unique island in the island’s integrated marine tourism system. This system stretches 250 kilometers of sea route, linking Ha Long – Bai Tu Long – Van Don island – Bai Tu Long National Park – Co To island – Vinh Thuc island – Tra Co beach with Cat Ba National Forest (the World Biosphere Reserve) and the marine resources system of Hai Phong city. These remarkable advantages make Ha Long Bay along with Cat Ba, Do Son (Hai Phong) are prioritized to develop into national tourist area.

Along with Ha Long Bay, places like Quan Lan, Minh Chau, Ngoc Vung, Bai Dai, Van Hai white sand mine… (in Van Don island district); or Tra Co, Vinh Thuc (in Mong Cai city) … with beautiful beaches, natural forests, intact coral reefs around the islands, offshore locations, have created special values of Quang Ninh tourism.

In addition to natural advantages, Quang Ninh is the only province with land and sea borders with China, an important and vibrant trade gateway between Vietnam, China and ASEAN countries. That is why large investors want to choose Quang Ninh. From the end of 2013 up to now, Quang Ninh has attracted more than 100 projects with total investment capital of more than 5.5 billion USD, nearly half of capital concentrated in Ha Long city, of which the strong investment waves mostly focus on the field of tourism.

There is not only the presence of Vietnamese investors such as Tuan Chau, Vingroup, Sun Group, FLC…, the attractiveness of Quang Ninh is also reflected in the presence of billion-dollar-super-projects of giants investors from United States, China, Thailand, United Arab Emirates… The famous names such as Wyndham, Starwood, ISC Corp, Amata, Nakheel… have landed in Ha Long with huge investment plan.

In the development plan, Quang Ninh is calling for investment in 14 large-scale eco-tourism real estate projects (period 2016 – 2020) and many other projects to develop 4 major tourism centers: Ha Long; Mong Cai – Tra Co; Van Don – Co To; Uong Bi – Dong Trieu – Quang Yen.

Standing in the top on tourism investment attraction, the keys that help Quang Ninh to balance its economic benefits and resource conservation are unified planning, consistent development and a clear view on investment attraction

Read More

Solar Energy Power Future in Vietnam

Although the initial investment cost for solar energy in Vietnam is high but it brings in opportunities for cheaper option than thermal power technology being used in Vietnam.

In other country, solar power plants are competing fiercely with the thermal power plants running on coal.

In Vietnam, Thien Tan solar energy plant has been started to construct on 24 ha land in Quang Ngai with capacity of 19.2 MW at investment of VND 800 bil. The Ministry of Industry and Trade has also approved the investment project of Tuy Phong solar energy plant on 50 ha land in Binh Thuan with capacity of 30 MW at investment of VND 1,454 bil. This will open opportunities for renewable energy to contribute to the effort of protecting the environment and curbing climate change.

The solar energy is new in Vietnam therefore the investment in this area is at very early stage. However, the foreign investors have been increasingly interested in seeking opportunities in investment in solar energy projects.

Similar to investment in wind power energy in Vietnam, one of the concerns for investors is the expected increase in purchasing price from Electricity Vietnam Corporation, the party whom purchase the electricity on Power Purchase Agreement (PPA). Further, legal frameworks for promoting solar energy investment are not yet finalized. Accordingly, the contribution ratio of renewable energy in Vietnam is minimal. The Vietnam government has been trying to put some effort to increase the renewable energy contribution to 5,6% (in 2020) and 9,4% (2030).

To achieve this, Vietnam government shall need to be consulted on plan to support the solar energy investment project in Vietnam in tax, land, capital, power purchase agreement. Investors would need to be consulted by local consulting firm on process, procedures on investment policy, appraisal process, power purchase agreement, and other steps to develop and execute an energy project in Vietnam to improve the effectiveness of the investment in renewable energy.

Read More

Solar Power Projects Appear More and More in The Central Region: Foreign Contractors Take Advantage

The Central Coast from Quang Ngai to Ninh Thuan is becoming a huge solar power construction site with a series of projects being groundbreaking and starting construction, in which foreign contractors make bold marks.

In the second half of 2018 and the early days of January 2019, a series of solar power projects were started in the Central region, with the most concentrated in Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa and Ninh Thuan.

Ninh Thuan attracts the most solar power projects in the country. According to the Department of Planning and Investment of this province, in the second half of 2018, there were 15 solar power projects taking steps to build. The number of projects to start construction continues to increase in the first half of 2019, because according to Vice Chairman of Ninh Thuan province, the provincial People’s Committee has issued decision on investment policies for 30 projects, with a total capacity of 1,788.79 MW.

Among the solar power plants that have started construction and are targeting the national grid before June 2019, there are projects such as CMX Renewable Vietnam of Re Sun Seap Vietnam Solar Power Joint Stock Company; My Son Solar Power Plant; Phuoc Huu Solar Power Plant; Solar Power Bim 1, Bim 2, Bim 3…

In Binh Dinh, many solar power projects have been present, such as Cat Hiep Solar Power Plant (Phu Cat District), Solar Power Plant combined with wind power of Fujiwara Joint Stock Company (Japan)…

In Phu Yen, according to Vice Chairman of Phu Yen People’s Committee, there are 7 projects in this province approved by the Ministry of Industry and Trade into the Electricity Plan VII. In which, 6 projects have been granted investment policies by the province.

Sterling Wilson, India’s leading solar power consulting and construction corporation, has completed the construction contract (EPC contract) for Sao Mai solar power plant project of Sao Mai Group, worth nearly 80 million USD (phase I).

Many power projects in Vietnam have the imprint of Power China Kunming Engineering Corporation Limited Consortium (Power China – a contractor from China), such as Package 7 on design, supply of equipment and materials, construction and installation of Vinh Tan 2 Solar Power Plant (EPC bidding package) under the Vinh Tan 2 Solar Power Plant Project, which is undertaken by Sinohydro Corporation Limited – Power China Kuming Engineering Corporation Limited Consortium.

Power China is also the contractor implementing the important bidding packages of Hong Phong 1 and Hong Phong 2 renewable power projects, under Vietnam Trading Engineering Construction Joint Stock Corporation (Vietracimex).

This is also the contractor participating in the implementation of bidding package DMS-8 on designing, supplying, installing and testing photovoltaic equipment under Da Mi solar power plant project; participating in implementing the package at Song Bung 4 Hydropower Plant Project (Quang Nam)…

Meanwhile, Binh Nguyen Solar Power Plant Project (Quang Ngai), which is led by Hawee as EPC general contractor, associated with Sharp Solar Solution Asia (SSSA – Japan) – Hawee IDC designed, constructed and installed.

As acknowledged by a number of reputable construction corporations in Vietnam, Vietnam’s solar power market is witnessing a wave of participation of foreign contractors, with a huge bid value for construction, installation, equipment, technology…, even a project signed contract under the form of turnkey contract with total project value of up to 80%.

Read More

Potential of Investment in Real Estate Market in Vietnam in 2018

According to Foreign Direct Investment Agency, the foreign direct investment amount into Vietnam in the area of real estate has reached 5.54 bil USD in the first six month of 2018, accounting for 27.3 % total registered investment. It appears that real estate is the second attractive sector, after industrial manufacturing. Foreign investors have com to realize that, Vietnam real estate market demand has grown steadily over the time for many reasons, including among others, the growing demand of mid-income consumer

Japan is leading investor in Vietnam with total 6.46 bil USD in various sectors, among which, real estate is getting more attractive. Recently, Sumitomo has been granted investment registration certificate for development of project in Dong Anh, Hanoi with 4.138 bil, which is the largest project in 2018. In the South, Nomura Real Estate has announced to have acquired 24% of Sun Wah Tower in CBD of Ho Chi Minh City. In Da Nang, Mikazuki has made investment of more than 100 mil USD in hospitality real estate.

Beside Japan, investors from Korea, Singapore, Taiwan, Malaysia have invested significantly over the years in the area of real estate and achieved success.

Sophisticated investors, mainly big real estate developers tend to rely on market research, analysis of international real estate agencies. Small and medium foreign investor, and individual in the meantime could utilize the flexibility and dynamic of local real estate consulting companies that provide insight not only to market overview but the behavior of local investor, developer that allow them to have assess to untouched market.

The investors could disburse investment through acquiring shares, capital in companies or provide financial support to local developers to develop project. If investors set up real estate company, the minimum investment requirement is 1 mil USD according to law.

Read More

Educational Investment: A Trillion Race

High profit margin, stable growth, lower risk than investment in other sectors. That is the reason, in recent years, investment in Vietnam education sector always takes place, especially large-scale M&A transactions in Vietnam.

One of the barriers for Vietnamese students to integrate into the world community is their limited English and soft skills. In addition, the curriculum of higher education has not linked to the labor market, people are more interested in spending on education. All that has led to investment in education over the years has become hectic.

In addition, the political stability, economic growth is the cause of increasing investment in education, but the capital scale that businesses invest in this field is still modest compared to other sectors. Hence, education is still a fertile market for investors to continue looking for opportunities.

Education is an area where there is no limit on demand. Along with the development in science and technology, the demand for professional knowledge and language skills to meet the requirements of domestic and foreign job market is increasing. Moreover, there is a growing need for sending children to study abroad. According to a recent study, 42% of Vietnam’s population is under the age of 24 – the golden age for almost all educational programs, so investing in bilingual schools, international universities, English language center is the “golden egg” for many businesses.

Investment trends in higher education will continue in the coming years as non-public universities currently only train less than 15% of the students, while the Government target is 30%. In Japan, Korea, private education and training facilities account for up to 70%.

According to the planning of the network of universities and colleges up to 2020, the total size of university and college education will reach about 2.2 million students, striving to 2020, the whole country has 224 universities and 236 colleges, but the capability to meet is still limited.

Many investors step into the race into this field, i.e. Cognita Education Fund buys International School HCMC (ISHCMC) and Saigon Pearl International Primary School, Nord Anglia Education Fund buys British International School (BIS), TPG – US Investment Fund buys the Vietnam Australia Bilingual School (VAS), EQT Investment Fund invests in the ILA English Language Center, TAEL Investment Fund invests in the Institute of American Education (IAE), the IFC Fund of the World Bank invests in Vietnam USA Society English Center (VUS), the Mekong Capital Fund invests in the Yola English Language Center, the Institute of American Education (IAE) invests in Thanh Tay University… among many transactions.

Another reason that education is attracting more investment is the steady source of profit. Although investment in education is considered as a long-term investment, as even 10 years later it is unlikely that the capital will be recovered, but the rate of profit against bank deposits is much higher and stable. There is also no bad debt because students must pay tuition at the beginning of the school year.

According to a recent statistic from Forbes Vietnam, out of 43 universities and colleges providing financial data, 77% of the schools have revenue exceeds their spending. The foreign language training offers the highest return in education investment, the lowest is 20% and with good performance, it can reach 50%.

The reason why investors are pouring money into education is because they can see the great potential of the market because the middle class is growing rapidly, the demand for education and expansion to the world is also increasing dramatically, while the education of Vietnam is backward.

Each year, it is estimated that Vietnamese people spend about 3 billion USD on overseas study and this number has grown rapidly over the years. According to the Ministry of Education and Training, if in 2010, 2011, the number of Vietnamese people studying abroad is about 98,000, then in 2016, it is about 130,000.

In Australia, each year the country earns 17 billion USD from international students, in which many of them coming from Vietnam. That is the driving force for investment in education in Vietnam next year higher than last year.

Read More

What Are Penalty for Violations in the Field of Construction in Hanoi?

In any field, mistakes can occur but differ in actual consequences. Especially in construction activities, the consequences are difficult to predict, the violations in construction activities, to any extent, affect individuals and collective users. Therefore, the Hanoi City People’s Council issued Resolution No. 07/2014/NQ-HDND prescribing the fine levels for a number of administrative violations in the field of construction.

This Resolution prescribes the fine levels for a number of administrative violations in construction activities in the Government’s Decree No. 121/2013/ND-CP of October 10, 2013 on sanctioning of violations. administration in construction activities; real estate business; exploitation, production and trading of construction materials; technical infrastructure management; housing and office development management (abbreviated to Decree No. 121/2013/ND-CP) in Hanoi city.

The Resolution provides a number of violations and penalties for corresponding acts of investors; of contractors and other organizations and individuals. In particular, the fine level prescribed for an administrative violation in the Resolution is equal to twice the fine level for the corresponding administrative violation in Decree No. 121/2013/ND-CP. The fines prescribed in Chapter II of this Resolution are those imposed on organizations. For the same administrative violation, the fine of an organization is 2 times that of an individual.

The titles competent to impose fines for administrative violations specified in Decree No. 121/2013/ND-CP are competent to impose penalties corresponding to the fines for the prescribed violations. in chapter II of this Resolution. Specifically, the subjects competent to sanction administrative violations under this Regulation include: Construction inspectors; Head of a specialized inspection team; Chief Inspector of Department of Construction; Chief Inspector of Ministry of Construction; Police; Market management; Presidents of People’s Committees at all levels

Above are the main contents of Resolution No. 07/2014/NQ-HDND of the Hanoi City People’s Council stipulating the fine level for a number of administrative violations in the field of construction, individuals and organizations should grasp to ensure their legitimate rights and interests. For compliance in the area of construction, it is important to consult with construction lawyers in Vietnam for advice.

Read More

M&A Wave from Korea to Vietnam Banking Sector

The success of many Korean banks in Vietnam makes Korean financial investors pay special attention to Vietnam banking sector. Investment methods that are most interested by investors are mergers and acquisitions (M&A).

According to information from the National Financial Supervisory Commission, Hana Financial Group (KEB Hana Bank) is preparing to buy shares of BIDV Bank.

Thus, the wave of investment from Korea to Vietnam financial and banking sectors have not stopped. Since the beginning of 2018, two Korean investors have successfully acquired two financial companies in Vietnam: Shinhan Card acquired Prudential Finance and Lotter Card acquired Techcombank Finance. Including KEB Hana, in 2018, Vietnam financial markets will welcome at least three new members from Korea.

According to the Director of the Korea Financial Supervisory Commission, Korean banks and finance companies are strongly attracted to the Vietnamese market.

In fact, even Korean financial investors operating in Vietnam are very optimistic about the potential development of the market. According to Director of Woori Bank, the Government of Vietnam is making great efforts in bank restructuring phase II, applying Basel II to strengthen the banking environment and attract more foreign investors. This will open more opportunities for investors.

Talking about the way to invest in Vietnam financial market, according to experts, in the coming time, the granting of licenses to establish banks in Vietnam will be more difficult, therefore, Korean businesses want to invest in the Vietnam banking sector should pay attention to the form of M&A.

Vietnam’s financial market is very potential, but foreign investor’s ownership rate is restricted (not to exceed 20%). However, the Government has allowed investors to buy 100% capital of weak banks.

Currently, digital finance is booming in Korea. Many banks like K-Bank, Kakao Bank allow customers to do transactions without human help. Shinhan, Woori and other Korean financial investors also want to quickly cover the Vietnamese market with the support of technology.

For example, Shinhan Card has just acquired Prudential Finance, but soon expressed its ambition to break the consumer lending market. According to Director of Shinhan Card, their annual sales amounted to 9 trillion won (about 180 trillion VND).

On the side of investors, according to CEO of Shinhan Bank Vietnam – one of the most successful foreign banks in Vietnam, the retail sector in Vietnam has many opportunities, keeping up fast with digital. Therefore, Shinhan Bank’s strategy is to focus on retail development in parallel with digital investment. Korean banks have a lot of experience in digital banking, plus the cultural similarity is a big advantage when investing in Vietnam.

With the technological strength, plus the strong wave of investment, Korean financial investors are really becoming a serious competitor in the financial market of Vietnam.

Read More

Changes needed for Development on Wind Energy in Vietnam

Changes needed for Development on Wind Energy in Vietnam

For economic sustainable development combined with environmental protection, the Government of Vietnam has made significant steps in the formulation of policies on renewable energy development, which take advantages of favorable conditions for the production of wind energy.

Many policies have been initiated to support wind power project, including power price assistance from central budget; assistance to grid and off-grid connected wind power projects… focusing on wind power electricity development target to achieve the total wind power capacity from the current negligible level to around 800 MW by 2020 and around 6,000 MW by 2030, raising the rate of electricity from wind power accounted for 0.8% in 2020 to 2.1% in 2030.

Some financial policies for investment projects under the Clean Development Mechanism (price supporting mechanism) are issued. Moreover, the Government published independent mechanisms to support wind power projects on electricity price for grid-connected wind power projects, power purchase agreements for wind power projects.

Nonetheless, there are difficulties in the development of wind power projects in Vietnam that should not be ignored. The first thing is difficulty of legal framework. The system of legislation, mechanisms and policies for wind power development are not synchronized. New project must be granted by the Ministry of Industry and Trade to establish the supplementary planning procedures prior to implementation. Power purchase agreement with EVN will be required as the initial condition to obtain investment permission.

Moving toward the future of clean energy in Vietnam, the Government should focus on implementation of preferential treatment to wind energy projects to increase the competitiveness of this renewable energy. In addition, the Government should also collaborate with investors, and industry experts to continue to research the wind power potential in Vietnam, further attract investment and assistance from domestic and international organizations for the wind power projects. Further, it is in the meantime required to have synchronized policies, legislations with the establishment of government authority to execute wind power planning and management to remove unreasonable barriers.

The increase in purchasing price from EVN will be attracting more investment. It has been discussed on the increase of buying price from 7,8 US cent/kWh however the timeline for the increase has not yet been finalized.

Read More

Shinhwa Group E&E (Korea) Invested in Solar Water Project in Quang Tri

Shinhwa E&E Co., Ltd (Korea) has conducted the survey and agreed to select the location of Trieu Thuong 1 and Trieu Thuong 2 lakes (Trieu Phong district, Quang Tri province) to implement two energy projects sun on the water in Quang Tri Province.

On January 24th, Shinhwa E&E Co., Ltd (Korea) had a meeting with Quang Tri People’s Committee on the occasion when the delegation come to explore opportunities for cooperation and investment in solar projects on the water in the province.

At the meeting, Shinhwa E&E Co., Ltd said that earlier, through the survey, the delegation has basically agreed to choose the location is Trieu Thuong 1 lake with a water surface of 35 hectares, which is expected to construct the solar power projects on the water with capacity of 20 MW; the Trieu Thuong 2 lake area with a water surface of 56 ha is expected to construct the solar power project on the water with capacity of 30 MW. Shinhwa E&E is expected to launch the project in two lakes Trieu Thuong 1 and 2.

Speaking at the meeting, the Vice Chairman of Quang Tri Provincial People’s Committee said that this is an interesting field. If Shinwa E&E Co., Ltd intends to invest, the province is very welcome and willing to create every favorable condition for the company to survey and implement the project.

Vice President Nguyen Quan Chinh assigned the Department of Industry and Trade to support Shinhwa E&E Company in the process of researching to implement the next steps in accordance with the law of Vietnam.

Also at the meeting, the two sides have signed a memorandum of understanding on the implementation coordination of solar power projects on the water in Quang Tri province. Accordingly, Shinhwa E&E Co., Ltd will study the investment location of solar power projects on the water in order to compile the supplementary plan of the project into the electricity planning of Quang Tri province. Moreover, Shinhwa E&E Co., Ltd is responsible for all expenses related to the survey, technical report and project development.

Read More

UJU Vina Inaugurates Electronic Component Factory in Vinh Phuc

UJU Vina Co., Ltd is one of the foreign investors who set up factory in Vietnam. Recently, they inaugurated their second factory with total investment of 9.2 million USD, producing electronic components. The factory was started construction in December 2016.

UJU Vina Co., Ltd., under UJU Electronics Corporation Korea, was established in June 2013 and officially came into operation in 2014, with total investment of over 20 million USD. The company specializes in manufacturing electronic components for the production and assembly of mobile phones, televisions, computers, personal digital assistants (PDAs), cars.

After 3 years operating in Vinh Phuc, UJU Vina has raised the investment capital to 25 million USD, creating jobs for nearly 1,000 employees, revenue from export reached nearly 10 million USD per year.

For the purpose of expanding production, in December 2016, the second factory was started construction with total investment of 9.2 million.

Speaking at the ceremony, the Chairman of Vinh Phuc People’s Committee congratulated UJU Vina Co., Ltd for completing the construction of the second factory, praising and appreciating the efforts of the Company’s Board of Directors and all employees strive for the factory to be built on schedule, soon put into operation.

In addition, the Chairman also wishes, UJU Vina Co., Ltd will continue to interest, introduce and become a bridge, helping Korean investors to know the potential and advantages when investing in Vinh Phuc.

Chairman of the provincial People’s Committee requested all levels and sectors of the province continue to pay attention to create the best conditions for companies to operate in production and business activities with high efficiency.

Read More

Finland Poured 33 Million USD into Clean Energy Projects in Vietnam

Watrec Company has just started to invest in Vietnam with a clean energy project, investment capital of 30 million euros (over 33 million dollars) in Hanoi.

Specifically, the project is converting energy from waste with the processing capacity of the plant about 600 tons of waste per day. The project is a comprehensive solution for collecting urban solid waste, classifying and converting it into biogas, as well as other combustible materials to produce electricity. At present, Watrec is in the process of negotiating with partners to finalize the allocation of funds for the project.

Watrec is the leading biogas technology company in Finland, handling 315,000 tonnes of organic waste each year at its plant-building chain. The project in Hanoi aims to manage the mixed waste that has not been classified and treat urban solid waste.

According to FinPro’s representative, Vietnam has the potential to develop clean energy projects from urban waste and agricultural and forestry waste.

FinPro focuses on converting waste into energy and bioenergy in Vietnam for about 2 years. Therefore, FinPro understands the potentials and challenges in converting waste into energy in Vietnam.

In fact, in recent years, many Finnish companies have invested and implemented projects in this field in Vietnam and have made positive progress.

For example, Doranova has one of the largest projects with a landfill disposal facility worth 6m euros under construction in the outskirts of Ho Chi Minh City, aiming to convert 35,000 tonnes of waste into energy.

Nearly a year ago, Doranova is one of the Finnish companies to undertake a project to convert waste into energy in Binh Duong. Accordingly, this project will recover the gas from the landfill and treat, supply the biogas to the power plant with a capacity of 1.6 MW.

Regarding the investment and construction of clean energy projects, according to representative of Valmet, the leading company in Finland, Vietnam is Valmet’s investment priority. From the investment realm, deploying projects in this area, Valmet’s representatives made 3 recommendations. First, it is necessary to determine the feasibility of the project by identifying the source of input waste from the plant. The second is about the fee collected from the garbage carrier to the processing plant. Third, it is necessary to consider electricity price lists when selling to EVN.

Read More

German Investors Funded 15 Million USD for Kinh Bac to Implement Workshop Project

Japan-Vietnam economic cooperation will form a new value chain

The total investment value of the project is 33.4 million USD, equivalent to about 755 billion VND, which is invested in construction and development in industrial zones.

According to information from Kinh Bac City Development Holding Corporation (KBC), the subsidiary of this unit is Kinh Bac Office and Workshop Trading One-Member Limited Company has just reached an agreement: signed contract to finance a project to build a workshop with the German Investment Corporation (DEG) under the German Development Bank (KfW). KfW is now managing more than 600 billion euros.

Accordingly, Kinh Bac Office and Workshop Trading One-Member Limited Company will receive a long-term loan from the DEG worth 15 million USD (total value of the project is 33.4 million USD) with a loan term of up to 8 years to supplement the capital for construction and development of workshops in industrial zones.

According to DEG’s representative, Mr Hubertus Pleister – Director of DEG Asia, Vietnam’s economy has grown steadily, continuously and sustainably over the long term, this is an important market, with many investment inflows. In addition, KBC is known as a prestigious business in the field of real estate and calls for foreign investment in industrial parks.

According to KBC, in addition to sponsored the above funds, DEG also committed to support KBC to access to other long-term development funds from financial institutions under the European Development Finance Institutions (EDFI) where DEG is a key member. KBC has undergone a rigorous 2-year appraisal process that ensures DEG’s criteria for financial capacity, management and environmental factors.

Read More

IHI Corporation (Japan) Wants to Participate in Transportation Projects in Hai Phong

Japan is a familiar investor in the Vietnamese market, many Japanese companies have set up business in Vietnam and IHI Corporation is not an exception.

Recently, Hai Phong People’s Committee has been working with the delegation of IHI Corporation (Japan) to explore opportunities to participate in transportation projects in Hai Phong. At the meeting, Mr Atsushi Kutawa – Managing Director of Operations, President in charge of business of IHI Corporation has talked about the company’s business situation with city leaders.

In particular, IHI has successfully built Binh bridge (Hai Phong) and Nhat Tan bridge (Hanoi). In 2015, the Group has built the IHI Infrastructure Asia (IIA) plant at Dinh Vu Industrial Park, which specializes in the manufacture of steel structures, supplying for bridge construction projects, thermal power plants and engineering facilities, serving for key construction works in the city.

Through investigation, it is known that there are plans to deploy Hai Phong transportation expansion projects, in which Nguyen Trai bridge and many key bridges connecting trade between the city and the northern provinces will be built. Hence, IHI Corporation wishes to have the opportunity to contribute their accumulated experiences to the cooperation and construction of these bridges.

Accordingly, Chairman of Hai Phong People’s Committee has highly appreciated the effective cooperation between Vietnam – IHI in the past time and also provide information about the bridge construction projects of Hai Phong in the coming time, like Nguyen Trai bridge, Vu Yen bridge…

In addition, he also expressed his wish that in the near future, IHI will explore and promote the cooperation in building bridges of Hai Phong. At the same time, in coordination with the Japan International Cooperation Agency (JICA), speed up the implementation of transportation projects, focusing on the Nguyen Trai bridge project.

Hai Phong always take care and create conditions for qualified contractors with high quality products. With the potential, efficiency and experiences of the IHI Corporation that has been confirmed, Hai Phong city will create the best conditions for the IHI Corporation to participate in the transportation development projects of Hai Phong in the coming time.

Read More

Foreigners Rushing to Buy Real Estate in Vietnam

Hundreds of millions of dollars are waiting to pour into Vietnam real estate market in most segments. The real estate market attracts a lot of foreign investors, mainly through M&A activities.

According to the newly announced report from Savills Vietnam, in quarter 2 of 2017, housing development projects received strong attention. China Fortune Land Development Group has bought shares in VinaCapital’s Lotus Dai Phuoc project for 65.3 million USD. Dai Phuoc Lotus is a residential area project with a total area of 198.5 million hectares in Dong Nai province, bordering Ho Chi Minh City.

In addition, VinaCapital’s Times Square project (Hanoi) worth 41 million USD is also transferred to Elite Capital Resources Limited.

Japanese investors are also active in the market. Nishi Nippon and Hankyu cooperate with Nam Long to build a 26 hectares Mizuki Park residential project in Binh Chanh district, Ho Chi Minh City with total investment capital of 351 million USD.

In addition, Aeon Mall – the famous Japanese retailer has officially co-operated with BIM Group to develop the second shopping center of Aeon in Hanoi with an area of 16.7 ha, the estimated investment capital is 200 million USD.

In the field of industrial real estate, Hemaraj Land & Development (Thailand) and Cienco 4 (Vietnam) have officially confirmed the joint venture to establish 1 billion USD industrial park on 3,200 hectares of land in Nghe An province.

In recent years, the real estate market of Vietnam has witnessed the strategic moves of investors, including mergers – acquisitions and development – cooperation. Some typical deals include Gaw Capital’s acquisition of a series of high-value commercial properties from Indochina Land, Gamuda Land’s acquisition of stake of local investors in the Celadon City project.

At the same time, the M&A market happened on a large scale in all different segments, such as the joint venture between Chau Tai Phuc and Suncity Group into the large resort and casino project in Nam Hoi An with total investment of up to 4 billion USD or the deal that Lotte acquired Diamond Plaza.

The market is expected to continue to be active in 2017 with a series of acquisitions and mergers.

According to JLL Vietnam, in the first half of 2017, Vietnam has attracted about 19.2 billion USD of foreign investment capital, increase by 54.8% over the same period last year. This shows that Vietnam is still one of the potential markets for investment in Southeast Asia.

There are hundreds of millions of dollars waiting to be poured into the domestic market in most segments, including housing, offices, retail, hotels and industrial parks, according to JLL. Investors come from different countries like Japan, Korea, Singapore, and the growth of investor groups from China.

Joint ventures are becoming more popular among foreign investors – with strong financial strength and experiences, they will work with local corporations – investors who holding land in the market and also has close relationships with local authorities.

The hotel segment has always attracted the attention in the recent time with a lot of foreign capital poured into Vietnam. Forecasting this trend will continue to grow, while other markets such as industrial park and education are also growing constantly. The affordable housing market is seen as attracting much investment capital, largely due to the rise of the middle class.

Lastly, according to Savills Vietnam, M&A will continue to be the form that the vast majority of investors will use to enter the Vietnamese market in order to realize their goals.

Read More

Tokyo Gas Wants to Build LNG Cai Mep - Thi Vai Port

Tokyo Gas (Japan) desires to invest in Vietnam, together with Vietnam partner to build LNG Cai Mep – Thi Vai port to become the most modern facility in Vietnam in this field.

On August 15th, Vietnam Prime Minister Nguyen Xuan Phuc has met Mr Michiaki Hirose, General Manager of Tokyo Gas (Japan).

At the meeting, the Prime Minister highly appreciated Tokyo Gas’s establishment of representative office in Vietnam; he also congratulated Tokyo Gas and PV Gas (Vietnam) for jointly establishing a business operating in the field of LNG gas in Vietnam and welcomed Tokyo Gas to launch a promising cooperation program with Vietnam.

In fact, the demand for liquefied petroleum gas in Vietnam is huge, especially in cities and coastal areas, the Prime Minister believes that with good partners, environment and demand, Tokyo Gas will succeed in Vietnam. Furthermore, many Vietnamese businesses are eager to do business with Japanese companies because of their great prestige, experience and resources.

Vietnam Prime Minister affirmed that oil and gas cooperation is one of the priority areas for Vietnam and Japan’s economic cooperation, at the same time Vietnam wishes that Tokyo Gas will maintain long term business in Vietnam.

According to Mr Michiaki Hirose, Tokyo Gas will strengthen its cooperation with PV Gas in the coming time and hope that Vietnam Government will support this cooperation. He also hoped that Tokyo Gas together with Vietnamese partner will construct LNG Cai Mep – Thi Vai port to become the most modern facility in Vietnam in this field.

With Japan, Vietnam is considered as an important partner in energy cooperation, including LNG. Japan – Vietnam cooperation will create a good premise for Tokyo Gas to implement the project in Vietnam. In that process, Tokyo Gas needs support from the Government of Vietnam on mechanisms and policies.

Read More

Italian Business Investing in Binh Duong | ANT Consulting

Ambassador of Italy in Vietnam and Binh Duong provincial leaders have attend the opening of the investment support office of Emilia Romagna (Italy) in Binh Duong.

This is the first representative office of the business community, investors of Emilia Romagna in Vietnam, which functions to create a bridge of cooperation between the two countries and promote Italian businesses to invest in Binh Duong.

On the same day in Binh Duong province, the ceremony to sign a memorandum of cooperation between Becamex IDC Corporation (under Binh Duong Provincial People’s Committee) with the Emilia Romagna region, Bonfiglioli Group and Unimore University (Italy). Content of the memorandum is to cooperate in economy, science, technology and education between the parties.

The Italian Embassy in Vietnam said Emilia Romagna is a dynamic economic region with many Italian famous enterprises in the field of manufacturing industry.

Through the opening of a representative office for the business community in the Binh Duong and signed a cooperation will open more opportunities, create the wave of investments by Italian enterprises to Vietnam in general and Binh Duong in particular.

Read More