Report to Boost Economic Activity: Business Briefing

US dollar exchange rate dips slightly

The State Bank of Vietnam has announced the daily reference exchange rate for the US dollar as VND 23,417/USD on October 6, remaining unchanged from the previous day. This rate reflects the value of the Vietnamese dong against the US dollar. The trading band currently in place allows for a fluctuation of +/-3 percent. As such, the ceiling rate applicable to commercial banks throughout the day is VND 24,119/USD, while the floor rate stands at VND 22,714/USD.

The opening-hour rates at several commercial banks remained consistent. As of 8:27 am, BIDV maintained a buying rate of VND 23,735/USD and a selling rate of VND 24,015/USD, which were unchanged from October 5. Similarly, Vietcombank also maintained the same rates, with a buying rate of VND 23,710/USD and a selling rate of VND 24,020/USD.

Photo: Zing

Rising Trends in Banking: Increased Deposit Interest Rates

Viet Capital Bank is pleased to introduce a new certificate of deposit offering for both individual and institutional customers. With competitive interest rates of up to 8.4%, customers can take advantage of this opportunity depending on the duration of their investment.

For a minimum investment of just VND 10 million (USD 417), customers can earn interest rates of 7.5%, 7.8%, 8%, and 8.2% for investment terms of 6, 9, 12, and 15 months respectively. For a longer investment term of 18 months, customers can earn an attractive interest rate of 8.4%.

Moreover, after the initial six-month period, customers have the flexibility to transfer their certificate of deposits while still enjoying higher interest rates when compared to ordinary savings deposits.

We invite both individual and institutional customers to take advantage of this exclusive opportunity and maximize their savings potential with Viet Capital Bank’s certificate of deposits.

Following the recent increase in the policy rate by the State Bank of Vietnam, several banks, including State-owned institutions, have raised their interest rates for VND deposits. Notably, ABBANK currently holds the highest rate of 8.8% for 13-month deposits totaling 500 billion VND (equivalent to 20.8 million USD) or more. In addition, banks are implementing promotional offers in order to attract deposits.

According to VNA, starting from October 3rd to December 30th, customers who deposit 25 million VND (equivalent to 1,040 USD) or more at Vietbank will be eligible for attractive gifts. The gifts offered include a range of useful items such as a multi-function electric cooker, steam iron, vacuum cleaner, umbrella, kitchen cutting board, and more. The specific gift received will depend on the deposited amount and the term of the deposit.

According to the latest data as of September 20, there has been a notable 4.04% rise in deposit mobilization by credit institutions. Concurrently, credit growth has seen a significant surge of 10.54%. This rapid credit expansion has placed additional strain on the liquidity of banks. ACB Securities has stated their intention to increase the credit cap by 2% in the last quarter. Additionally, the State Bank of Vietnam (SBV) plans to intervene by selling US dollars, aiming to stabilize the exchange rate. However, this measure is also expected to exert pressure on the liquidity of the Vietnamese dong (VND).

The state treasury’s planned increase in public spending during the upcoming months is expected to result in the withdrawal of funds from banks. In light of these developments, ACBS predicts that banks will likely raise deposit interest rates by an additional 0.5 percentage points this year in order to maintain sufficient liquidity.

Photo: Zing

2020 Market Forecast: E-Retail Industry to Experience 20% Boom

The Covid-19 pandemic has had a negative impact on Vietnam’s economic growth in recent years. However, it has also led to a substantial increase in e-commerce, with retail revenue reaching USD 13.7 billion in 2021, representing a growth of 16%. This information comes from the White Book on Vietnamese E-business 2022. In 2020, Vietnam experienced its lowest economic growth in 30 years, at only 2.58%, with various key service sub-sectors facing a decline.

According to the General Statistics Office’s data, there was a 0.21% decline in retail and wholesale sales, resulting in a 0.02 percentage point decrease in the overall economy. Warehouse and logistics experienced a significant decrease of 5.02%, while lodging and catering services saw a substantial decline of 20.81%. These declines in these sectors contributed to a decrease of 0.3% and 0.51% in the GDP growth, respectively.

The e-retail sector has seen significant growth in recent years, with last year’s total retail sales of goods and services reaching a record 7% from online sales alone. This represents a 27% increase from the previous year. Projections for this year indicate a further surge in e-retail, with expectations of a 20% growth to reach 16.4 billion USD. This growth is particularly notable when compared to the 5 billion USD recorded in 2015. In a 2022 study conducted by Metric.vn, a leading big data analysis company, Vietnam’s e-commerce market has emerged as the second largest in Southeast Asia, trailing only behind Indonesia.

According to The White Book on Vietnamese E-business 2022, online marketplaces have become crucial distribution channels in the digital age. As a result, Vietnamese enterprises are increasing their investments to enhance their presence on these platforms. The book’s findings reveal that businesses leveraging social networks such as Facebook, Zalo, and Instagram experienced a growth rate of 41% in 2021 and an impressive 57% in 2022.

Photo: Zing

Khanh Hoa to Increase Direct Flight Connections to Kazakhstan

Vietjet Air, a budget carrier, will commence transportation of tourists from Almaty, the largest city in Kazakhstan, to the central province of Khanh Hoa in the coming weeks. This collaboration between the airline and Anex Vietnam Travel and Trading Co., Ltd., aims to contribute to the revitalization of tourism following the Covid-19 pandemic. Bui Quoc Dai, the deputy managing director of Anex Vietnam, confirmed this joint effort.

According to the scheduled plan, the carrier will be offering biweekly flights between Cam Ranh and Almaty, starting from the end of this month until April of next year. The inaugural flight is set to depart from Cam Ranh International Airport on October 25th, heading to Almaty International Airport. The return journey from Kazakhstan is scheduled for the following day. The anticipated passenger capacity per flight is approximately 180 to 200 individuals, as reported by Dai.

Kazakhstani tourists will enjoy a vacation lasting between one to four weeks at exceptional hotels and resorts in the beautiful province of Khanh Hoa. They will have the opportunity to indulge in shopping experiences and explore the city through guided tours. As a testament to its appeal, Khanh Hoa has already begun attracting interest from Kazakhstani delegations interested in surveying the tourism potential of Vietnam, with a specific focus on the advantages offered by the central province. Notably, in the first nine months of 2022, Khanh Hoa saw a remarkable increase in tourist arrivals, with over 2.1 million visitors – including 150,000 international tourists – representing a substantial 7.3-fold growth compared to the same period last year.

Photo: Vietnamnet

Record-Breaking Heatwave Predicted for June: Weather Forecast

According to Nguyen Van Huong, an official from the National Centre for HydroMeteorological Forecasting, a cold front is expected to move from China to Vietnam. This weather system will result in a significant drop in temperatures in the northern regions of the country over the upcoming weekend. The cold spell is projected to reach Vietnam’s northern highlands on October 9, before moving across the northern midland and plain areas.

According to Huong, the upcoming winter in Vietnam will bring the first cold front, resulting in a significant temperature decrease in the mountainous region. During the night and early morning, temperatures are expected to drop below 20 degrees Celsius.

According to the weather forecast for the night of October 9, mountainous areas will experience cold temperatures while the plain region will turn cool. Additionally, a cold air wave is expected to bring heavy rainfall to the northern, north-central, and central regions. In the second half of October, several cold spells are projected to occur in northern Vietnam. However, the most intense cold spells are anticipated to occur in December 2022 and extend into January 2023.