Latest news with #Hanoi-based
International Business Times
15 hours ago
- Business
- International Business Times
Vietnam's Trade Surpasses Forecasts Amid Rush to Beat Potential Trump Tariffs
Vietnam's exports increased more than anticipated in July as buyers scrambled to avoid a 20% tariff on the nation's exports to the US that would go into effect on Thursday, August 7. According to a statement from the statistics office, exports increased 16% in July compared to the same month last year to $42.3 billion, exceeding forecasts of 14% growth. Over the period, imports increased 17.8% to $40 billion, exceeding the 15.2% forecast. Compared to the $2.83 billion released in June, the trade surplus was $2.27 billion. This year, the export-heavy Southeast Asian country, which sells everything from clothing and coffee to engine parts, has been shipping more goods to customers who want to avoid the tariffs imposed by US President Donald Trump. Originally threatened with a 46% import levy, the country now only faces a 20% import levy, one percentage point higher than its neighbors, Malaysia, the Philippines, and Thailand. Tran Tuan Minh, chief executive officer of TVI, a Hanoi-based equity research and investment firm told Economic Times, "Vietnam posted impressive export figures in July, mostly because companies were rushing to ship goods to the US ahead of the Trump tariffs." "We expect exports to slow significantly later this year, mainly due to the 20% tariffs and especially the 40% rate on transshipments, which still remains quite unclear at this point," the CEO added. Trade negotiators are trying to "actively continue" discussions with Washington, the government said in a statement on Wednesday. Additionally, it reaffirmed its intentions to increase domestic consumption of Vietnamese goods and diversify its markets, with a focus on trade agreements with the Middle East and India. Separate customs data that was released on Wednesday, August 6, showed that exports to the US increased 26% to $14.2 billion in July compared to the same month last year. In July, Chinese imports reached roughly $16.7 billion, a 30.5% increase. Roughly 5% of Vietnam's GDP comes from net exports to the US, and factories that have flourished as businesses have diversified their supply chains from China are at risk from the tariffs. Consumer prices rose 3.19% year over year, which was less than the 3.40% economist estimate and the 3.57% pace of June, but the data was generally positive. Industrial production increased by 0.5% from June and 8.5% year over year. Exports of commodities increased as well; coffee exports increased to 103,000 tons, a 34.6% increase from the previous year. According to data released last month, the economy has been booming in 2025, with the gross domestic product increasing 7.96% from April to June compared to the same period last year. It's unclear if the new US tariffs will thwart the government's 2025 growth target of 8%.
Economic Times
21 hours ago
- Business
- Economic Times
Vietnam trade beats estimates as buyers race Trump tariffs
Synopsis Vietnam's exports surged by 16% in July, exceeding expectations, as companies rushed shipments to the US ahead of impending tariffs. While exports to the US rose significantly, imports from China also increased. The tariffs pose a threat to Vietnam's economic growth, prompting trade negotiators to seek alternative markets and boost domestic consumption. iStock The Southeast Asian nation, an export powerhouse that sells everything from coffee and clothing to engine parts, has been shipping more goods this year to buyers aiming to avoid US President Donald Trump's tariffs. Vietnam's exports jumped more than expected in July, with buyers racing to avoid a 20% tariff on the country's exports to the US set to take effect on Aug. rose 16% in July from a year earlier to $42.3 billion, the statistics office said in a statement, beating expectations of 14% growth. Imports rose 17.8% in the period to $40 billion, more than the 15.2% forecast. The trade surplus was $2.27 billion, versus $2.83 billion released in Southeast Asian nation, an export powerhouse that sells everything from coffee and clothing to engine parts, has been shipping more goods this year to buyers aiming to avoid US President Donald Trump's tariffs. The country was initially threatened with a 46% import levy, though that has been lowered to 20%, just one percentage point more than for neighbors Indonesia, Malaysia, the Philippines and Thailand. 'Vietnam posted impressive export figures in July, mostly because companies were rushing to ship goods to the US ahead of the Trump tariffs,' said Tran Tuan Minh, chief executive officer of TVI, a Hanoi-based equity research and investment firm. 'We expect exports to slow significantly later this year, mainly due to the 20% tariffs and especially the 40% rate on transshipments, which still remains quite unclear at this point.' The government said in a statement Wednesday that trade negotiators are working to 'actively continue' talks with Washington. It also reiterated plans to diversify its markets, aiming for trade agreements with the Middle East and India, while increasing domestic consumption of Vietnamese goods. Exports to the US rose 26% in July from a year earlier to $14.2 billion, according to separate customs data released Wednesday. Imports from China increased 30.5% to about $16.7 billion in exports to the US account for roughly a fifth of Vietnam's gross domestic product, and the tariffs pose a threat to factories which have boomed as companies have diversified their supply chains from China. The data was generally positive, with consumer prices rising 3.19% on year, slower than the 3.40% economist estimate and the 3.57% pace of June. Industrial production rose 8.5% on year, and 0.5% compared with June. Commodity exports also gained, with coffee exports rising to 103,000 tons, a 34.6% rise on a year economy has been powering along in 2025, with gross domestic product rising 7.96% in the April-June period from a year earlier, according to data released last month. The government is aiming for 8% growth in 2025, though it's unclear whether the new US tariffs will derail that push.
Business Times
2 days ago
- Business
- Business Times
Vietnam trade beats estimates as buyers race Trump tariffs
[HANOI] Vietnam's exports jumped more than expected in July, with buyers racing to avoid a 20 per cent tariff on the country's exports to the US set to take effect on Aug 7. Exports rose 16 per cent in July from a year earlier to US$42.3 billion, the statistics office said in a statement, beating expectations of 14 per cent growth. Imports rose 17.8 per cent in the period to US$40 billion, more than the 15.2 per cent forecast. The trade surplus was US$2.27 billion, versus US$2.83 billion released in June. The country, an export powerhouse that sells everything from coffee and clothing to engine parts, has been shipping more goods this year to buyers aiming to avoid US President Donald Trump's tariffs. It was initially threatened with a 46 per cent import levy, though that has been lowered to 20 per cent, just one percentage point more than for neighbours Indonesia, Malaysia, the Philippines and Thailand. 'Vietnam posted impressive export figures in July, mostly because companies were rushing to ship goods to the US ahead of the Trump tariffs,' said Tran Tuan Minh, chief executive officer of TVI, a Hanoi-based equity research and investment firm. 'We expect exports to slow significantly later this year, mainly due to the 20 per cent tariffs and especially the 40 per cent rate on transshipments, which still remains quite unclear at this point.' The government said in a statement on Wednesday (Aug 6) that trade negotiators are working to 'actively continue' talks with Washington. It also reiterated plans to diversify its markets, aiming for trade agreements with the Middle East and India, while increasing domestic consumption of Vietnamese goods. Exports to the US rose 26 per cent in July from a year earlier to US$14.2 billion, according to separate customs data released on Wednesday. Imports from China increased 30.5 per cent to about US$16.7 billion in July. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Net exports to the US account for roughly a fifth of Vietnam's gross domestic product, and the tariffs pose a threat to factories which have boomed as companies have diversified their supply chains from China. The data was generally positive, with consumer prices rising 3.19 per cent on year, slower than the 3.40 per cent economist estimate and the 3.57 per cent pace of June. Industrial production rose 8.5 per cent on year, and 0.5 per cent compared with June. Commodity exports also gained, with coffee exports rising to 103,000 tonnes, a 34.6 per cent rise on a year earlier. The economy has been powering along in 2025, with gross domestic product rising 7.96 per cent in the April-to-June period from a year earlier, according to data released last month. The government is aiming for 8 per cent growth in 2025, though it's unclear whether the new US tariffs will derail that push. BLOOMBERG
Business Times
25-07-2025
- Business
- Business Times
Vietnam mulls overhaul of property transfer tax, sparks fears of stalling recovery
[HO CHI MINH CITY] Vietnam's Ministry of Finance has unveiled a sweeping proposal to overhaul the way personal income tax is applied to real estate transactions – replacing the current flat 2 per cent levy on selling price with higher percentages, based on how long the property is held, or 20 per cent of the actual capital gains per transaction. The ministry states that the change is necessary to plug tax loopholes, reduce speculation, and create a more equitable tax regime. However, industry stakeholders warn that the shift could dampen liquidity, inflate prices for real homebuyers, and further weaken an already-fragile property market. Under the proposal, individuals selling real estate would be taxed 20 per cent on the net profit, which is the difference between the selling price and the original purchase price, minus related costs. In cases where the purchase price or expenses cannot be verified, tax would be applied to the gross sale value, based on how long the property was held. That marks a sharp increase from the current flat 2 per cent tax on the selling price to as much as 10 per cent for properties owned for less than two years. The ministry says the new model better reflects true earnings and is modelled after systems used in Singapore, Taiwan and Malaysia, where tax rates also scale with holding periods to deter speculative flipping. In Singapore, for instance, residential properties resold within a year are subject to a 100 per cent tax on the price gain. In Malaysia, the Real Property Gains Tax imposes rates of up to 30 per cent on properties sold within three years. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The latest shift in the rule, outlined in the draft of the revised Personal Income Tax Law, is now open for public consultation until the end of this month and is expected to go before the National Assembly for review and approval this October. Huynh Thi Huong Giang, head of research at property advisory firm Savills in Ho Chi Minh City, said: 'From my perspective, applying this tax model under current conditions without adequate infrastructure would be very challenging.' She noted that Vietnam's property data system remains fragmented, with transfer prices largely based on declared values in sales agreements, and that actual transaction prices are often higher. '(We expect) a negative impact on market liquidity, potentially slowing down transaction processes, causing tax collection bottlenecks, and increasing the risk of disputes and legal conflicts,' she noted. Sellers may also respond to higher taxes by raising housing prices to maintain their profit margins, potentially making homes less affordable for genuine buyers, Giang added. Nguyen Thi Thu Xuan, a Hanoi-based investor who frequently buys and resells homes with a group of friends, believes that speculative investing will continue both in undervalued properties and amid rising market prices due to a supply crunch. 'It won't hurt us as much as it hurts end-buyers who actually need a home,' she said, noting that additional tax costs could push prices even higher. Xuan added that in practice, if sale prices are not truthfully declared, a 10 per cent or 20 per cent tax is mostly symbolic. 'It doesn't mean higher tax costs,' she said. 'In fact, steeper rates might just drive more people to exploit loopholes and under-report transactions.' The finance ministry appears aware of the challenges in applying the new property tax rule. In a response to local media reports, officials stressed the need for a gradual transition with a suitable road map, tied to the development of land and housing policies, data infrastructure and legal frameworks for tracking and taxing property profits. Problematic timing Dinh Minh Tuan, southern regional director at PropertyGuru Vietnam, which owns the country's largest real estate portal said the timing of applying the new rule was problematic. 'While the policy aims to 'reward holders, penalise flippers,' it also raises concerns about timing and broader market impact, especially as the real estate sector remains sluggish,' he stated in a commentary. 'The proposal may prove more harmful than beneficial.' Vietnam's real estate market plunged into a slump in 2022 and 2023, with supply freezing up, liquidity drying out, and many housing projects stalling. Transactions started picking up in 2024 and 2025, showing signs of market recovery following a series of regulatory reforms. However, property prices have been soaring exponentially due to supply-demand imbalance and speculative buying, making them out of reach for most residents. In major urban centres such as Hanoi and Ho Chi Minh City, it now takes several decades of the disposable income of a family at the median to purchase an apartment. 'We expect residential prices to continue their upward trajectory (for the rest of the year), largely driven by the launch of high-end projects and ongoing supply constraints,' noted Savills' Giang. A survey of more than 1,000 users found that 59 per cent bought real estate primarily for investment, not for personal use, and many were planning to sell within the year. Tuan noted that short-term investors now make up a significant share of the market, especially in segments of land plots and high-end condominiums. 'A 10 per cent tax would significantly eat into profit margins, reducing investment appeal and potentially pushing small investors out, further dampening market liquidity,' he stated. He believes this tax hike could act as an untimely brake, stalling the recovery momentum and causing ripple effects in related sectors of the economy. The Vietnamese government is aiming for 8.3 to 8.5 per cent economic growth this year, from 7.1 per cent last year, to create a foundation for double-digit growth in the 2026-2030 period. Prime Minister Pham Minh Chinh recently emphasised that Vietnam must revitalise its traditional growth engines – domestic consumption, exports and investment – while also embracing new drivers such as green growth and the digital economy. With US tariff hikes weighing on trade, experts say that a rebound in the real estate market and increased infrastructure spending would be crucial to boosting consumer confidence in the country's economy, where household consumption contributes to about 60 per cent of the gross domestic product.
Business Times
25-07-2025
- Business
- Business Times
Vietnam mulls property transfer tax overhaul, sparking fears of stalled recovery momentum
[HO CHI MINH CITY] Vietnam's Ministry of Finance has unveiled a sweeping proposal to overhaul the way personal income tax is applied to real estate transactions – replacing the current flat 2 per cent levy on selling price with higher percentages based on how long the property is held or 20 per cent of the actual capital gains per transaction. The ministry states that the change is necessary to plug tax loopholes, reduce speculation, and create a more equitable tax regime. However, industry stakeholders warn the shift could dampen liquidity, inflate prices for real homebuyers, and further weaken an already fragile property market. Under the proposal, individuals selling real estate would be taxed 20 per cent on the net profit, which is the difference between the selling price and the original purchase price, minus related costs. In cases where the purchase price or expenses cannot be verified, tax would be applied to the gross sale value based on how long the property was held. That marks a sharp increase from the current flat 2 per cent tax on selling price to as much as 10 per cent for properties owned for less than two years. The ministry says the new model better reflects true earnings and is modelled after systems used in Singapore, Taiwan and Malaysia, where tax rates also scale with holding periods to deter speculative flipping. In Singapore, for instance, residential properties resold within one year are subject to a 100 per cent tax on the price gain, while in Malaysia, the Real Property Gains Tax imposes rates of up to 30 per cent on properties sold within three years. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up The latest rule shift, outlined in the draft of the revised Personal Income Tax Law, is now open for public consultation until the end of this month and is expected to go before the National Assembly for review and approval this October. 'From my perspective, applying this tax model under current conditions without adequate infrastructure would be very challenging,' said Huynh Thi Huong Giang, head of research at property advisory firm Savills in Ho Chi Minh City. She noted that Vietnam's property data system remains fragmented, with transfer prices largely based on declared values in sales agreements, even though actual transaction prices are often higher. '(We expect) a negative impact on market liquidity, potentially slowing down transaction processes, causing tax collection bottlenecks, and increasing the risk of disputes and legal conflicts,' she noted. Sellers may also respond to higher taxes by raising housing prices to maintain their profit margins, potentially making homes less affordable for genuine buyers, Giang added. Nguyen Thi Thu Xuan, a Hanoi-based investor who frequently buys and resells homes with a group of friends, believes that speculative investing will continue both in undervalued properties and amid rising market prices due to a supply crunch. 'It won't hurt us as much as it hurts end-buyers who actually need a home,' she said, noting that additional tax costs could push prices even higher. Xuan added that in practice, if sale prices aren't truthfully declared, a 10 per cent or 20 per cent tax is mostly symbolic. 'It doesn't mean higher tax costs,' she said. 'In fact, steeper rates might just drive more people to exploit loopholes and underreport transactions.' The finance ministry appears aware of the challenges in applying the new property tax rule. In a response to local media, officials stressed the need for a gradual transition with a suitable road map, tied to the development of land and housing policies, data infrastructure, and legal frameworks for tracking and taxing property profits. Problematic timing Dinh Minh Tuan, southern regional director at PropertyGuru Vietnam, which owns the country's largest real estate portal says the timing of applying the new rule is problematic. 'While the policy aims to 'reward holders, penalise flippers,' it also raises concerns about timing and broader market impact, especially as the real estate sector remains sluggish,' he stated in a commentary. 'The proposal may prove more harmful than beneficial.' Vietnam's real estate market plunged into a slump in 2022 and 2023, with supply freezing up, liquidity drying out, and many housing projects stalling. Transactions started picking up in 2024 and 2025, showing signs of market recovery following a series of regulatory reforms. However, property prices have been soaring exponentially due to supply-demand imbalance and speculative buying, making them out of reach for most residents. In major urban centres such as Hanoi and Ho Chi Minh City, it now takes several decades of a family's median disposable income to purchase an apartment. 'We expect residential prices to continue their upward trajectory (for the rest of the year), largely driven by the launch of high-end projects and ongoing supply constraints,' noted Savills' Giang. A survey of more than 1,000 users found that 59 per cent bought real estate primarily for investment, not for personal use, and many plan to sell within the year. Tuan noted that short-term investors currently make up a significant share of the market, especially in segments of land plots and high-end condominiums. 'A 10 per cent tax would significantly eat into profit margins, reducing investment appeal and potentially pushing small investors out, further dampening market liquidity,' he stated. He believes this tax hike could act as an untimely brake, stalling recovery momentum and causing ripple effects across related sectors of the economy. The Vietnamese government is aiming for 8.3 to 8.5 per cent economic growth this year, from 7.1 per cent last year, to create a foundation for double-digit growth in the 2026-2030 period. According to a recent statement, Prime Minister Pham Minh Chinh emphasised that Vietnam must revitalise its traditional growth engines – domestic consumption, exports, and investment – while also embracing new drivers such as green growth and the digital economy. With US tariff hikes weighing on trade, experts say that a rebound in the real estate market and increased infrastructure spending will be crucial to boosting consumer confidence in a key driver of Vietnam's economy, where household consumption makes up around 60 per cent of its gross domestic product.
