Vietnam 20240926: Numinous, Arcane, Exoteric
Vietnam 20240926: Numinous, Arcane, Exoteric
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Headlines:
U.S. Trip for Technology, Energy, and Diplomatic Relations
Cambodia Canal Project Raises More Concerns
Workforce Must Upskill to Lead High-Tech
Ambitious Goals for Semiconductor Growth
Auto Market Gears Up with Geely Investment
AI Ambitions Drive Push for Self-Reliance
Truong My Lan Offers Project to Compensate Fraud Victims
Telecom Law Opens Door to FDI in Digital Services
International Relations: IN, FR, CU
SpaceX Plans $1.5 Billion VN Starlink Investment
Ha Long Bay Sees Environmental Threat From Typhoon
Property Market Enters Recovery Phase
Energy Infrastructure Developments
Tourism Grows Broadly, Declines from Thailand
Growing Airline Connections and Challenges
HCMC Infrastructure Faces Logistics Scrutiny
U.S. Trip for Technology, Energy, and Diplomatic Relations
Party Chief To Lam met with President Biden in New York, discussing ways to strengthen U.S.-Vietnam relations while countering China and Russia's influence. Meetings with tech giants like Apple, Meta, and Supermicro were held in aid of Vietnam's tech economy. Vietnamese and U.S. firms signed several MoUs, including partnerships in energy, AI, and data centers.
Read more: Japan Times (Biden Meeting), Economic Times (MoUs), Reuters (Corporate Meetings)
Cambodia Canal Project Raises More Concerns
Cambodia’s $1.7 billion China-funded Funan Techo Canal, designed to link the Mekong River to the Gulf of Thailand, is alarming Vietnam. Experts say the canal could disrupt the Mekong's natural flood systems, depriving Vietnam's Mekong Delta of nutrient-rich silt, worsening droughts and hurting rice production. Vietnam, though cautious in its response, is concerned about the environmental and economic impact. Cambodia views the project as crucial for its trade and sovereignty, adding diplomatic complexity to an already tense regional issue.
Read more: RFA (Diplomatic Tensions), AP News (Mekong Impact), Firstpost (Vietnam Worries)
Workforce Must Upskill to Lead High-Tech
Vietnam is urged to enhance workforce skills in emerging fields like AI, semiconductors, and robotics to remain competitive in the global high-tech revolution. Industry leaders emphasized the importance of training the younger generation and collaborating with international tech firms to meet growing demand. Meanwhile, scams targeting Vietnamese workers seeking jobs in South Korea are on the rise, exposing vulnerabilities in the recruitment process. Authorities are working to address these issues to protect job seekers and boost Vietnam's high-tech potential.
Read more: Vietnam News (High-tech workforce), RFA (Job scams)
Ambitious Goals for Semiconductor Growth
Vietnam’s semiconductor industry is set for further expansion, with a new government strategy targeting the establishment of one chip fabrication plant and 10 assembly, packaging, and testing (APT) factories by 2030. The strategy is intended to develop a self-reliant semiconductor ecosystem and capitalize on foreign direct investment. By 2030, the sector is expected to generate $25 billion in revenue, with a workforce of 50,000 engineers. Global players like Intel and Amkor Technology are already involved, and the government plans to issue incentives to support growth.
Read more: Vietnam Economic News (Growth potential), VietnamPlus (National strategy), The Investor (Revenue targets)
Auto Market Gears Up with Geely Investment
Chinese automaker Geely has announced a $168 million investment to build an assembly plant with local partner Tasco. The plant will produce 75,000 vehicles annually, boosting local manufacturing and supply chains. Car sales in Vietnam are projected to hit 1 million units by 2030, with a strong focus on electric, hybrid, and solar-powered vehicles.
Read more: Just Auto (Geely Plant), VnEconomy (Sales Projection), Teslarati (Local Assembly)
AI Ambitions Drive Push for Self-Reliance
Vietnam is prioritizing artificial intelligence (AI) and semiconductor sectors as pillars of its economic future. Experts from firms like AMD speak about Vietnam’s potential to become a global AI leader, supported by a skilled workforce, healthy ecosystem, and government backing. Vietnam’s recently issued semiconductor industry strategy aims to improve human resources and infrastructure to accelerate AI and tech advancements.
Read more: Tuoi Tre News
Truong My Lan Offers Project to Compensate Fraud Victims
Truong My Lan, chairwoman of Van Thinh Phat, has offered nearly 300 assets, including an 11,000-square-meter "mega project" in downtown Ho Chi Minh City, to compensate victims of a fraudulent bond scheme. The bond issuance, which occurred in 2018, led to losses of VND30 trillion ($1.2 billion) for 35,800 investors. Lan has denied full culpability but is offering projects, including the Amigo property, to raise funds for compensation. She has already sold assets at discounts to raise money but is facing multiple charges.
Read more: VnExpress
Telecom Law Opens Door to FDI in Digital Services
An updated telecom law, effective from July 2024, is expected to attract foreign investment by liberalizing non-facilities-based telecom services such as cloud computing and data centers. The new law eliminates previous licensing and fee requirements for these services, aligning Vietnam with international treaties like the CPTPP and EVFTA. This reform is expected to streamline market entry, boost innovation in digital infrastructure, and position Vietnam as a player in the global tech landscape.
Read more: Legal Business Online
International Relations: IN, FR, CU
Party General Secretary To Lam met with Indian Prime Minister Narendra Modi to discuss raising bilateral trade to $30 billion by 2030. A forum in France promoted economic exchange to create long-term partnerships. Lam has arrived in Cuba for a state visit, a milestone in Vietnam-Cuba relations.
Read more: VnEconomy (India meeting), Vietnam News (France forum), DTiNews (Cuba visit)
SpaceX Plans $1.5 Billion VN Starlink Investment
Elon Musk’s SpaceX is planning to invest $1.5 billion in Vietnam to launch Starlink satellite internet services. This investment, revealed by Vietnam’s government, could resolve ongoing discussions over providing satellite internet and communications services in the country. Initial talks had stalled in late 2023 but have resumed, positioning Vietnam as a key hub for SpaceX’s Starlink expansion. The move is expected to improve Vietnam’s digital infrastructure and provide widespread internet connectivity, especially in remote areas.
Read more: Nikkei Asia
Ha Long Bay Sees Environmental Threat From Typhoon
Following Typhoon No. 3, Ha Long Bay is struggling with an environmental crisis as large amounts of debris, primarily from damaged aquaculture rafts, have accumulated in the bay. The Ha Long Bay Management Board has mobilized over 1,100 personnel and 301 vehicles to clean up the waste, which is affecting the area's ecosystem and tourism. Despite ongoing efforts, the vast area and challenging conditions make complete cleanup difficult, and authorities are calling for further resources and cooperation to mitigate the impact.
Read more: DTiNews
Property Market Enters Recovery Phase
Vietnam's real estate market is entering a recovery phase driven by strong housing demand, rising foreign investment, and regulatory reforms. The government is revising laws to control dual pricing in property transactions and increase transparency. Demand for mid-range apartments dominates in Hanoi, accounting for 98% of new supply. Landmark 72, Vietnam’s second-tallest skyscraper, is on sale for $753 million, reflecting ongoing interest in high-end assets. New policies, including the 2024 Land Law, are expected to attract further investment and boost market recovery.
Read more: Vietnam Economic News (Regulatory Reforms), The Investor (Housing Demand), DTiNews (Hanoi Apartment Market), Tuoi Tre News (Landmark 72 Sale), Vietnam Economic News (Market Recovery)
Energy Infrastructure Developments
The government is exploring nuclear energy, urging the Ministry of Industry and Trade to learn from international experiences, particularly focusing on small modular reactors. Foreign investors, notably from the U.S., are showing interest in Vietnam's LNG infrastructure, with multiple LNG plants and terminals in development. Battery energy storage systems are also under consideration, as a shift towards renewable and sustainable energy sources to meet growing demand and achieve net-zero targets by 2050 remains ongoing.
Read more: Vietnam Economic News (Nuclear energy), Vietnam News (LNG investment), Tuoi Tre News (Battery Storage)
Tourism Grows Broadly, Declines from Thailand
The tourism industry is at a crossroads, balancing growing global recognition and regional challenges. The U.S. market is increasingly important, with efforts to attract American tourists through cinema and cultural promotion. Vietnam's luxury hotels and resorts are receiving accolades across Asia, boosting the country's appeal for high-end travelers. The country is seeing a big drop in Thai visitors due to rising airfares and limited new attractions, with competition from China further complicating the recovery.
Read more: Vietnam Insider (U.S. Market), Travel and Tour World (Luxury Hotels), Travel and Tour World (Thai Visitor Decline)
Growing Airline Connections and Challenges
Vietnam Airlines is launching a nonstop service from Hanoi and Milan and Malaysia Airlines beginning a direct route between KL and Da Nang. A growing issue is emerging: an increase in passengers being denied entry at Vietnamese airports. Over 600 passengers were refused entry in the first half of 2024, forcing airlines to tighten document checks to avoid costly disruptions.
Read more: Breaking Travel News (Milan), AeroTime (Da Nang-KL), DTiNews (Entry Refusals)
HCMC Infrastructure Faces Logistics Scrutiny
Ho Chi Minh City's logistics infrastructure is under pressure, with foreign investors expressing frustration over congestion and high logistics costs. The city's long-delayed Metro Line 1 has set a new completion date for the end of 2024, aiming to alleviate transport bottlenecks. Vietnam's broader logistics sector is transforming, supported by exports to the EU, which surged 17.4% in 2024. Improvements in logistics efficiency and infrastructure are seen as crucial to maintaining competitiveness and meeting the demands of international trade agreements.
Read more: VnExpress (Investor Concerns), Vietnam Insider (Metro Line Delays), Nhan Dan (EU Export Growth)
That’s it for this week!
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