Posted on 01 Jun 2015
Ho Chi Minh City, Vietnam’s largest economic hub, recorded a positive economic growth rate in May and throughout the first five months of 2015, a conference heard on May 28.
According to the municipal People’s Committee, total retail sales of goods and services are estimated at over 54.3 trillion VND (2.49 billion USD) for May and more than 267 trillion VND (12.28 billion USD) for the January-May period, up by 10.8 percent compared to the same period last year.
The city’s Consumer Price Index rose by 0.3 percent in May against the previous month. This month, the export turnover is estimated at 2.57 billion USD and import turnover at 2.67 billion USD.
During the first five months, more than 113.7 trillion VND (5.23 billion USD) was collected for the city budget, up by 4.7 percent year on year.
Most notably, the city’s index for industrial production is estimated to increase by 6 percent compared to the same period in 2014.
The Director of the municipal Department of Planning and Investment, Thai Van Re, said domestic and foreign investors alike also recorded positive results in the city.
As of May 20, the city granted investment licenses to 207 projects worth a total of 672.7 million USD, 72.5 percent more projects than during the same period last year. Meanwhile, 390 million USD was added to 68 existing projects.
The Chairman of the municipal People’s Committee, Le Hoang Quan, called upon local departments and authorities to focus on helping enterprises overcome difficulties in production and operations.
Localities were asked to develop industry, renovate technologies, increase competitiveness and improve product quality.
In order to maintain Ho Chi Minh City’s rate of economic growth, the committee prioritised intensifying trade and investment promotion efforts, expanding potential markets, and strengthening the connectivity between enterprises and banks.
Argentinian economist: Vietnam - thriving and competitive market
With its relatively high growth rate and improved income per capita, Vietnam has been offering both opportunities and challenges for Argentine enterprises, according to Argentinian economic expert Julio Sevares.
In a story published in Argentina’s Clarin newspaper on May 27, Julio Savares hailed Vietnam’s economic achievements in recent years and highlighted cooperation opportunities in trade and investment.
Julio Sevares, a professor at the University of Buenos Aires (UBA), also indicated a number of benefits and challenges that Argentinian enterprises face when operating or investing in Vietnam.
From its historic military victory, Vietnam has gained successes in the economy, and as a result Argentina has been benefitting from the Southeast Asian nation’s development by exporting goods and diversifying its products and investment portfolio, according to the story.
Vietnam’s economy grew by 5.8 percent last year and is expected to rise by 6 percent this year. Per capita income has increased fivefold since the economic reform process began 30 years ago.
The Vietnamese Government has issued a number of policies to attract private investment and has introduced reforms of its tax, customs and investment regulations. Furthermore, Vietnam is promoting the development of products of highly added value.
In 2002-2014, the trade volume between Vietnam and Argentina increased 20-fold to 1.706 billion USD in total.
In addition to animal food, tanned leather, animal and plant oil, wheat and cotton, Vietnam also has a high demand for Argentinian meat, fruit, wine, milk and pharmaceutical products.
According to Julio Savares, Argentinian businesses operating in Vietnam have to navigate cultural differences and face growing competition from local products.
The Free Trade Agreements (FTAs) between Vietnam and other Asian countries with Chile, Australia and New Zealand pose another challenge to Argentinian businesses, Julio Sevares said.
Vietnam has been a member of the World Trade Organisation since 2007 and a member of the Association of Southeast Asian Nations since 1995. It signed an FTA with the Republic of Korea and is currently finalising the procedures to sign FTAs with the Eurasia Economic Union, the European Union and the Trans-Pacific Partnership, which features the United States and Japan.
Vietnam offer a great opportunity for Argentina, but this also requires Argentinian private and State-owned enterprises to develop and apply a long-term strategy, he said.
