Ho Chi Minh city is the most dynamic economic city and financial hub of Vietnam.
(Photo: laodong.vn)
The pandemic has indeed dampened the high growth seen in early 2021 and the GDP growth for the first nine months is less than the market forecast at 1.4 percent. Nevertheless, Maetha Peeravud, Assistant Vice President – Fund Management Group, BBL Asset Management, believed Vietnam’s economy has passed the lowest point, reported VNA.
“Looking three to six months ahead, the outlook for the Vietnamese economy is positive,” he was quoted by the Bangkok Post as saying.
The COVID-19 vaccination rate is increasing with large cities like Ho Chi Minh City and Hanoi already giving the first shot to over 90 percent of their population, Maetha said, adding that the country is expected to achieve herd immunity in the first or second quarter of next year.
Geographically, Vietnam has a strategic location for its high-performing export sector. With the focus on education, free trade agreement, and labour skill enhancements, the global supply chain has paid great attention to Vietnam, including Samsung, the Korean multinational manufacturing conglomerate, which allocates over half of its mobile phone manufacturing capacity to Vietnam.
Illustrative image. (Photo: VNA)
Bloomberg forecasts Vietnam's GDP growth at 7 percent next year, one of the highest in the Southeast Asian region.
Maetha agreed with Bloomberg’s positive outlook, identifying three major big long-term themes.
First, urbanisation in Vietnam will lead to a demographic dividend, namely the economic growth resulting from a change in the age structure of the population.
Over half of the Vietnamese population is under 35. The number of workers in the industry and service sectors is increasing while that in agriculture is decreasing, suggesting a major shift toward higher income generation.
Secondly, Vietnam is benefiting from industrialisation growth from foreign direct investment (FDI).
Vietnam enjoyed strong support in developing more advanced technology and high-skilled labour training from global technology companies, which would in turn help produce more premium products, he said.
According to Maetha, digitalisation is the third factor contributing to Vietnam’s growth.
Along with its 5-year plan, the Vietnamese government also targets the digital economy share of GDP to grow from 5 percent in 2019 to 20 percent in 2025, he said.
In addition to economic growth, the Vietnamese equity market is bullish with many catalysts.
Jeff Suteesopon, ASEAN Equity Portfolio Manager and Vice President – Fund Management Group, BBL Asset Management, said the market capitalisation of the three stock exchanges in Vietnam is around 7 trillion baht, compared to Thailand’s 18 trillion baht, suggesting an opportunity to grow.
Another catalyst is its valuation, Jeff said. Even with the strong rise in 2020 and 2021, the valuations of Vietnam stock are not too high. The Forward P/E ratio in 2022 for the VN Index is only 13, compared to 16 on the Thai SET Index. Moreover, earnings growth is going strong. Forecast EPS growth of the VN Index in 2021, 2022, and 2023 is 25 percent, 18 percent, and 16 percent respectively, he said.
Jeff said the most important was that the Vietnamese government was working on elevating its market from “frontier” to “emerging” which will attract more investment to the country.
He emphasised that: “The politics in Vietnam is very stable, as is the Vietnamese dong, especially over the past three years, with good export growth and consequently strong foreign reserves.”
RoK and UK business associations support consumption of Vietnamese goods abroad
The Vietnam-Korea Business & Investment Association (VKBIA) and the Vietnam Business Association in the UK (VBUK) have signed a comprehensive co-operation agreement for a joint scheme to boost investment, business co-operation, and support for the consumption of local goods abroad, reported VOV.
Delegates join the virtual signing ceremony (Photo:VNA)
The signing ceremony was held virtually on October 18 in order to clearly demonstrate the companionship of overseas Vietnamese entrepreneurs and intellectuals towards the nation, whilst also celebrating the 17th anniversary of Vietnamese Entrepreneurs' Day on October 13.
This therefore represents an opportunity for foreign entrepreneurs and businesses who are co-operating, investing, and doing business in the nation, the Republic of Korea and the UK to exchange their experience and promote business co-operation across a variety of fields.
Tran Hai Linh, member of the Central Committee of the Vietnam Fatherland Front, and VKBIA shared, “It has been 29 years since the establishment of diplomatic relations. In 1992, the relationship between Vietnam and the Republic of Korea has seen strong developments in multiple fields such as politics, national defence, security, economy, science and technology, culture, tourism and, people-to-people exchange.
Regarding economic co-operation, on the basis of the Vietnam-Korea Free Trade Agreement (VKFTA), which took effect in 2015, the two sides need to further expand trade and investment activities, striving to increase trade turnover to US$100 billion,” Linh stated.
Along with boosting trade balance through the RoK’s increased import of key local products, the nation desires for the RoK to continue encouraging their businesses to invest in the Southeast Asian nation, thereby creating opportunities for Vietnamese enterprises to engage in the global production and supply chain.
According to Hoang Viet Phuong, chairman of the VBUK, bilateral trade between country and the UK has surged by approximately 10 times, from between US$600 million and US$700 million in 2007 to US$6.5 billion at present.
During 15 years of operation, the VBUK has succeeded in connecting the business community in the country with that of the UK, whilst simultaneously supporting many businesses in both the UK and Europe to associate and enter into joint ventures alongside other domestic businesses.
The VBUK Executive Board for the 2021 to 2026 term has set a target of expanding and developing the connection between the local business community in the UK and Vietnamese businesses both at home and abroad. This is being done to promote trade between the Vietnamese business community around the world and develop the community moving forward.
Speaking at the signing ceremony, Kim Seok-pil, vice president of the VKBIA Association and former General Director - CEO of Samsung Group in Europe, said that VKBIA will co-ordinate efforts to ramp up co-operation between Vietnamese and Korean partners, as well as those in other nations.
The two sides will also strive to redouble efforts to boost all-around activites in seeking multilateral co-operation opportunities in Vietnam, the RoK, and the UK. This will be done through connecting networks of overseas businesses and entrepreneurs, agencies, and organisations of numerous countries, whilst increasing the use of partner networks in accessing different markets with specific objectives, he said.
Simon Jeong, vice chairman of the VKBIA Association, expressed his belief that in the near future, VKBIA and VBUK will launch a range of practical activities as a means of supporting Vietnamese businesses and localities. These efforts will help them to boost trade exchanges with agencies and relevant partners of the three nations and other countries.
Short films about Vietnamese beauty screened on YouTube
As many as 60 short films featuring a variety of attractive locations nationwide are being screened on the YouTube channel Vietnamsunday, reported VOV.
A scene of the short film that features the beauty of Ha Giang province
According to Vietnamese producer Chung Lan, the short films have been made by numerous young filmmakers, all of whom are majoring in film and architecture in both Vietnam and abroad. All of them share the same desire to introduce the country’s array of beauty and cultural identity to both local and international friends.
A scene of the short film that features the beauty of Ha Giang province
Lan added that each of the short films lasts between three to 15 minutes long and can be viewed with English subtitles.
Moving forward, the film crew expects to produce approximately 120 other short films by the end of the year.