Vietnam Economic News: 21 - 28.6.2024
Summary of Vietnam Economic News: 21 - 28.6.2024
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Summary of Vietnam Economic News: 21 - 28.6.2024 ---
VIETNAM AIRLINES CONSIDERS BUYING CHINESE C919 PASSENGER JETS
Reuters News – 27 June 2024
Vietnam Airlines is considering buying Chinese-made C919 passenger jets to cope with a shortage of aircraft, local media reported on Thursday. "The airline is working on a plan to operate this fleet of aircraft," business newspaper reported. On Monday, the company had said in a statement that global engine recalls by Pratt & Whitney were causing aircraft shortages and impacting operations. The C919 passenger jet, manufactured by Commercial Aviation Corp of China (COMAC), landed in Vietnam for the first time in February, after making its international debut at the Singapore Airshow.
VIETNAM RAISES $532 MLN IN GOV'T BOND AUCTION, WITH LOWER COUPONS
Reuters News – 26 June 2024
Vietnam's State Treasury raised 13.55 trillion dong ($532 million) in an auction where it had offered 15 trillion dong of government bonds at the Hanoi Stock Exchange on Wednesday, with coupons falling for the first time this year. The amount is higher than the $323 million raised last week, a bourse filing showed. The uptake was also higher, with 90% of the offer sold, up from 78% in last week's auction.
IMF SAYS VIETNAM 2024 GDP GROWTH SEEN AT CLOSE TO 6%
Vietnam News – 26 June 2024
The International Monetary Fund (IMF) said on Wednesday that Vietnam's economic growth is expected to be close to 6% this year, supported by strong external demand, resilient foreign investment and accommodative policies. However, downside risks are high, the IMF said in a statement. "Exports, a key driver for Vietnam's economy, could weaken if global growth disappoints, global geopolitical tensions persist, or trade disputes intensify," it said. Domestically, persistent weakness in the real estate sector and corporate bond market could weigh more than expected on banks' ability to expand credit and hurt economic growth and undermine financial stability, it added. Given easy monetary conditions, if exchange rate pressures were to persist for longer it could lead to a larger pass-through to domestic inflation, it said.
VIETNAM FLAG CARRIER AT RISK OF INSOLVENCY IF GOVT-BACKED LOAN IS NOT EXTENDED
Reuters News – 25 June 2024
National carrier Vietnam Airlines JSC is facing the risk of losing liquidity as early as July if the refinancing loan repayment deadline for its government-backed loan is not extended, the government said on Tuesday. The airline, which received 4 trillion dong ($157 million) in low-cost loans from commercial banks that were refinanced at a zero interest rate by the central bank in 2021, is grappling with financial difficulties due to the impact of the pandemic, the government said in a statement. It has not completed refinancing efforts, such as restructuring non-core investments and sales of new shares due to regulatory approvals, the statement added. According to the government, Vietnam Airlines may face significant risks, lawsuits and reputational damage if the loan repayment was not extended. "It is just one of the solutions to help Vietnam Airlines overcome difficulties, but it is the most feasible and appropriate solution at the moment," the government said. The government recommended the lawmakers allow loan repayment extensions through Dec. 31, 2027 to give the airline time to complete its restructuring, the statement said. ($1 = 25,455.0000 dong)
FOXCONN TO INVEST $383 MLN IN VIETNAM CIRCUIT BOARD PLANT, SAYS STATE MEDIA
Reuters News – 24 June 2024
Foxconn Singapore has been awarded a licence to invest $383 million in a factory to produce printed circuit boards in Vietnam, state media reported on Monday. The plant in the northern province of Bac Ninh will produce 2.79 million products a year, Cong Thuong newspaper reported. Foxconn, the world's largest contract electronics maker and assembler, did not immediately respond to a Reuters request for comment on the report. Foxconn has invested more than $3.2 billion in Vietnam since fist entering the country in the 2000s. Most of its manufacturing plants are located in the northern provinces of Bac Ninh and Bac Giang. Earlier this month, Vietnamese state media said Foxconn will produce 5G AirScale equipment for Nokia at Bac Giang.
RUSSIA OFFERS TO HELP VIETNAM DEVELOP NUCLEAR ENERGY
Reuters News – 23 June 2024
Russia offered to help Vietnam develop nuclear power plants during President Vladimir Putin's trip to Hanoi, Alexei Likhachev, head of the Russian state nuclear firm Rosatom told RIA agency in remarks published on Monday. Likhachev, who was part of Putin's entourage during his visit to Vietnam last week, said that he had made the offer to Vietnam Prime Minister Pham Minh Chinh. "We offered all possible options for co-operation... in my conversation with the prime minister of Vietnam," RIA cited Likhachev as saying. "Rosatom offers foreign partners not only high-power, but also low-power nuclear power plants, both in land-based and floating versions." Vietnam has no nuclear power plants and scrapped plans to build its first two nuclear power plants in 2016 following the Fukushima disaster in Japan and due to budget constraints. Before Vietnam cancelled its plans to build the plants, Rosatom had offered Hanoi a project based on high-power units with advanced Russian reactors, Likhachev said. During the visit, where Putin received a 21-gun salute at a military ceremony, Russia and Vietnam signed agreements on issues including energy, underlining Moscow's pivot to Asia after the West imposed sanctions on Moscow over the conflict in Ukraine.