Analysis

Vietnam's banking sector shifts from short-term pressure on books to long-term debt management
OBG
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Non-performing loans (NPLs) continue to be a challenge for Vietnam’s banking sector following the banking crunch of 2012. The government and the State Bank of Vietnam (SBV) have made the issue a priority. A key step was the creation of the Vietnam Asset Management Company (VAMC) in 2012. NPLs built up thanks largely to poor lending practices at a number of banks. Bad loans were particularly prevalent…

Analysis

Bonds
OBG
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When mentioning Vietnam’s capital market, most investors think of the VN-Index and the privatisation of state-owned enterprises, forgetting a promising fixed-income market. Vietnam’s debt market is larger than the equity one, and debt financing remains a major source of funds in Vietnam. Unlike equity market, the fixed-income market offers sizeable investment opportunities, professional local…

Analysis

Real estate
OBG
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Vietnam has an exceptionally high GDP growth rate, but the prosperity has not spread across the country. GDP per capita in the two biggest cities, Ho Chi Minh City and Hanoi, reached $2000 in 2007 and 2010, respectively, in each case marking the first boom in real estate. Since then, GDP per capita has increased by 13% per year in both cities, while the population has increased at a compound annual…

Analysis

Vietnam's Unlisted Public Company Market sees increase in company listings
OBG
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The Unlisted Public Company Market (UPCoM) on the Hanoi Stock Exchange (HNX) is effectively a mezzanine exchange, set up to encourage unlisted firms to participate in the securities market, with a view that those on UPCoM may later transfer onto the main market. UPCoM brings a number of benefits to investors. Transactions, clearance and settlement are all carried out through a centralised system,…

Analysis

Investment
OBG
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In order to maintain the exceptionally good growth rate of around 6.5% in 2017-20 and successfully restructure the economy, Vietnam needs $250bn of investment, equivalent to approximately 25% of GDP, in the period. Foreign direct investment (FDI) and the public sector have historically accounted for 25% and 35%, respectively, of total investment. In recent years FDI disbursement has become increasingly…

Analysis

Vietnam's coastal city of Da Nang attracts investment due to sandy beaches and mountainous scenery
OBG
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One of Vietnam’s fastest-rising tourist destinations, the central coastal city of Da Nang has received significant international attention for its sandy beaches, mountainous scenery, and world-renowned luxury hillside resort in recent years, with airlines moving to increase services to the city in a bid to meet rising tourism demand. Visitor arrivals are set to grow again in 2017, after recording…

Analysis

Private investment needed in Vietnam's energy sector for next stage of development
OBG
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Widely regarded as a poster child for power sector development in emerging markets, Vietnam has increased access to electricity from 54% to 98% of the country’s population since 1990, connecting some 55m people in the process. Until now, it has also been successful in meeting double-digit annual growth in demand, resulting from a booming economy and a burgeoning population, largely using indigenous…

Analysis

New agreements and initiatives to keep Vietnam's manufacturing sector on top
OBG
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With the signing a series of free trade agreements (FTA), Vietnam’s textile and garment sector will see a host of new business opportunities as well as new challenges as competition among regional producers heats up. It is crucial that the industry continues to attract orders; it has been a major revenue generator for the country’s economy, with some 5000 textile and garment businesses…

Analysis

Vietnam increasingly focused on unexplored oil and gas fields
OBG
plus

Exploitation of shallow-water resources over the last 30 years has allowed Vietnam to become an oil exporter while meeting domestic gas demand. With the third-largest proven oil reserves in East Asia, at 4.4bn barrels, and the fourth-largest offshore gas reserves in the region, estimated at 600bn cu metres in 2015, it has the potential to meet growing demand for years to come. However, declining hydrocarbons…

Analysis

Despite recent setbacks, coffee looks to remain a major player in Vietnam
OBG
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Vietnam has become the world’s second-largest coffee exporter and producer, behind Brazil, with beans grown on around 500,000 predominantly small holdings of 0.8 ha to 1.2 ha each. The country is the largest producer ofrobusta, a low-cost, high-yield family of coffee plants that is normally used in espresso blends or instant coffee powders. Coffee was first introduced into Vietnam in 1857…