Vietnam Economic News: 2.11 – 9.11.2024
Summary of Vietnam Economic News: 2.11 - 9.11.2024
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Summary of Vietnam Economic News: 2.11 - 9.11.2024 ---
VIETNAM RECORDS $2 BLN TRADE SURPLUS IN OCTOBER, LOWEST SINCE MAY
Reuters News – 6 November 2024
Vietnam reported an October trade surplus of $2 billion, narrowing from the previous month as imports grew at a faster rate than exports, government data showed on Wednesday. The country, a regional manufacturing hub, relies heavily on exports for its economic growth. Shipments rose 10.1% in October from a year earlier, the General Statistics Office (GSO) said, while imports increased by 13.6%. October's trade surplus was the smallest since May, according to GSO data. The agency said nearly 94% of imports in October were raw materials for manufacturing. "Export growth will remain solid from resilient export growth in textiles and computers," Oxford Economics said in a note following the October data. China is Vietnam's biggest source of imports. According to the GSO's data breakdown, as of August, Vietnam's imports this year from China reached $92 billion, up 26% compared to the same period last year. That represented 37% of Vietnam's imports this year. For the JanuaryOctober period, exports rose 14.9% from a year earlier to $335.59 billion, while imports were up 16.8% to $312.28 billion, the GSO said. Industrial production gained 7.0% in October from a year earlier, slower than the 10.8% growth the previous month, which Oxford Economics said could reflect the impacts of Typhoon Yagi, which wreaked havoc in Vietnam in September. Last month, the prime minister said the government wanted to drive economic growth above an expected rate of 6.8% to 7.0% this year. In the September quarter, annual growth hit a two-year high of 7.4%. The consumer price index rose 2.89% in October from a year earlier, below the government's cap for 2024. It was up 0.33% on the previous month. Standard Chartered in a note on Tuesday said that amid the ongoing upward trend in inflation, coupled with a likely weaker dong, the central bank could raise interest rates by 50 basis points in the second quarter of 2025. ($1 = 25,380.0000 dong)
US TECH FIRMS WARN VIETNAM'S PLANNED LAW TO HAMPER DATA CENTRES AND SOCIAL MEDIA PLATFORMS
Reuters News – 4 November 2024
U.S. tech companies have warned Vietnam's government that a draft law to tighten rules on data protection and limit data transfers abroad would hamper social media platforms and data centre operators from growing their businesses in the country. The country with a population of 100 million is one of the world's largest markets for Facebook and other online platforms and is aiming to exponentially increase its data centre industry with foreign investment in coming years. The draft law "will make it challenging for tech companies, social media platforms and data centre operators to reach the customers that rely on them daily," said Jason Oxman, who chairs the Information Technology Industry Council (ITI), a trade association representing big tech companies including Meta, Google and data centres operator Equinix. The draft law, being discussed in parliament, is also designed to ease authorities' access to information and was urged by the ministry of public security, Vietnamese and foreign officials said. Vietnam's parliament is discussing the law in its current month-long session and is scheduled to pass it on Nov. 30 "if eligible", according to its programme, which is subject to changes. Existing Vietnamese regulations already limit cross-border transfers of data under some circumstances, but they are rarely enforced. It is unclear how the new law, if adopted, would impact foreign investment in the country. Reuters reported in August Google was considering setting up a large data centre in southern Vietnam before the draft law was presented in parliament. Research firm BMI had said Vietnam could become a major regional player in the data centres industry as limits on foreign ownership are set to end next year.
THAI SCG HALTS OPERATIONS AT $5.4 BLN VIETNAM PETROCHEMICAL COMPLEX
Reuters News – 4 November 2024
Thailand's largest industrial conglomerate, said on Monday it has suspended commercial operation at its $5.4 billion Long Son Petrochemicals complex in Vietnam after only one month due to "the chemicals' low margin". The chemicals industry has been grappling with high inventory and destocking for the past few quarters, putting pressure on several firms. "The resumption will depend on global dynamic demand," SCG said in a statement. SCG did not give a clear timeframe for the suspension but expected the chemicals industry would remain challenging well into the fiscal year 2025. LSP, which commenced commercial operations in Vietnam's southern province of Ba Ria-Vung Tau on Sept. 30, is the first integrated petrochemical complex in Vietnam and produces polyethylene, polypropylene and basic chemicals. Last year, SCG representatives said the complex's capacity would reach 1.3 million to 1.5 million tonnes. Total demand for Vietnam was about 3.3 million tonnes of both polyethylene and polypropylene combined, it said at the time. Last week, SCG also announced another $700 million investment in the Vietnamese complex for storage of ethane feedstock.
FOXCONN SUBSIDIARY SEEKS $80 MLN VIETNAM INVESTMENT FOR INTEGRATED CIRCUITS
Reuters News – 4 November 2024
Taiwanese giant Foxconn's subsidiary Shunsin is seeking a permit to invest $80 million in northern Vietnam to produce integrated circuits, according to a document from Vietnam's environment ministry. The proposed plant in Bac Giang province will focus on producing and processing electronic components, specifically integrated circuit boards, the document said. Shunsin plans to begin operations at full-scale in December 2026, with annual capacity of 4.5 million units, the document added. Shunsin did not immediately respond to a request for comment. It is majority owned by a unit of Foxconn, the world's largest contract electronics maker and assembler. Foxconn, formally known as Hon Hai Precision Industry, already has major operations in Vietnam. In July, Foxconn, through its unit Foxconn Singapore, was awarded a license to invest $383 million in a factory for printed circuit boards in northern Vietnam. According to the ministry document, all products from the Vietnam Shunsin plant will be for export to the United States, European Union, and Japan. Foxconn has invested more than $3.2 billion in Vietnam since fist entering the Southeast Asian country in the 2000s. Most of its manufacturing plants are located in the northern provinces of Bac Ninh and Bac Giang.