Nick Le, Research Fellow
It has been an eventful week in Vietnam
On August 17th, the Ministry of Finance and Justice asked the Ministry of Planning and Investment (MPI) to quickly finalize the list of State-owned enterprises (SOEs) that needed to be divested by 2020 for approval by PM Nguyễn Xuân Phúc. According to the MPI’s draft, “the total number of SOEs (excluding enterprises belonging to the Ministry of National Defence, Ministry of Public Security, HCM City People’s Committee, SCIC and those divesting according to the PM’s separate decision) are 375 with total capital according to face value of more than VNĐ108.5 trillion (US$4.76 billion). Of the SOEs, 161 will be divested in 2017 and the number for the next three years is 185, 65 and 25, respectively.” The total divestment capital is expected to be VND 64.46 trillion. In addition, the draft also stated that the divestment must be transparent and compliance to legal structure to the market mechanism. [Vietnam News]
Finance Ministry proposes ‘reasonable’ tax hikes - The Ministry of Finance (MoF) in Ha Noi introduced a draft of amendments to laws on Value Added Tax, Special Consumption Tax, Corporate Income Tax, Personal Income Tax and Natural Resources Protection Tax at a press conference on Tuesday (8/15). According to Phạm Đình Thi, Director of the ministry’s Tax Policy Department, “the amendments were needed to address difficulties that remained for tax paying businesses and individuals, ensure a coherent legal framework, and better deal with rising public debts.” Including in the amendments is an increase of VAT to 12% in Vietnam. According to experts, by increasing VAT to 12% and lowering income tax, this will continue to hurt the poor; thus, creating a bigger gap between the rich and the poor in Vietnam. [Vietnam News]
Korea has invested $2.7 billion into Binh Duong’s economy - Up to Q3 of 2017, Korea is the third largest foreign investor (after Singapore and Taiwan) of Binh Duong’s economy with 619 projects totaling up to $2.7 billion dollar. Mr. Nguyễn Thanh Trúc, Director of Department of Planning and Investment of Binh Duong province, recently reported that Binh Duong’s economy has continued to see positive inflow of FDI and has seen a 51% increase compared to Q3 of 2016. The province of Binh Duong is looking into expanding its economy by continue to grow 33 industrial zones that will cover 15,000 hectare or 37,000 acres. [CafeF]
Should all taxis in Ha Noi have the same color? The Department of Transportation in Ha Noi proposed that there should only be one color on all taxis operating in Ha Noi. Currently, there are 77 different taxi companies in Ha Noi, and there are overlapping in colors. The proposed policy will require all taxis in Ha Noi will have one color. There are some push back against this proposal because it will affect major taxi companies who may have already built a brand and customer loyalty over the years. Regardless, the proposal did receive some support and will continue to be discussed in further details. [CafeF]
On some other news, the Prime Minister of Vietnam, Mr. Nguyễn Xuân Phúc and his wife will be visiting Thailand after accepting an invitation from Prime Minister Prayut Chan-o-cha from August 17th - 19th, 2017. [CafeF]