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New MoU Signed Between Vietnam Airlines And Sabre

March 2019

A memorandum of understanding (MOU) has been signed by Vietnam Airlines and Sabre, a leading provider of systems for air bookings, as part of efforts to take forward the implementation of the former's Digital Transformation Programme. This new agreement follows a USD 400 million renewed deal between Vietnam Airlines and Sabre in 2018.

Under the MOU, Vietnam Airlines would potentially pay USD 300 million for innovative technology from Sabre AirVision and AirCenter portfolio. The state-owned airline expects that its existing passenger service system (PSS) will be complemented by SabreSonic which helps to deliver cost savings and improve operational efficiency.

Vietnam Airlines is considering the application of a new, long-term domistic content distribution agreement through the Sabre Global Distribution System (GDS). One of the airline's subsidiary will also adopt the SabreSonic PSS. A deal is expected to be finalized within a few months to implement a single integrated passenger technology platform across both airlines.

(Source: Aerospace Technology)

Vietnamese Airlines To Be Permitted To Establish Direct Services To The US

February 2019

In February 2019, the US Department of Transportation’s Federal Aviation Administration (FAA) granted a Category 1 safety rating to Vietnam, based on an assessment of the safety oversight provided by the Civil Aviation Authority of Vietnam (CAAV). The CAAV started preparing for the evaluation since 2012 with active support from Boeing. Vietnam failed the test twice before being granted the Category 1 rating now. Forty-nine problems, more than half of them related to air safety, were found in the first CAT 1 conducted in 2013. The second test  in 2017 in response to the new requirements for opening routes to the US found good performance but there were still areas to be addressed.

Category 1 means air carriers from a country may initiate or continue service to the US and participate in reciprocal code-share arrangements with US airlines. Vietnamese airlines will be able to establish direct services to the US after the necessary remaining steps are completed, including Vietnamese airports earning approval to comply with ICAO (International Civil Aviation Organization) security standards and recommended practices from the US Transportation Security Administration, and Vietnamese airlines earning economic authority from the US Department of Transportation.

Vietnam's national flag carrier Vietnam Airlines, newly-launched Bamboo Airways and budget-carrier Vietjet Air have all expressed interest in establishing direct flights to the US to meet market demand. Vietnam Airlines expects to have aircraft that can fly directly to the US by 2022.

(Sources: Vietnam News; The Voice of Vietnam)

Vietnam's Newest Airline Bamboo Airways Launches Flights

January 2019

On Jan 16, the Vietnam's Bamboo Airways completed its inaugural flight that departed from Ho Chi Minh City and arrrived at Hanoi's Noi Bai International. It joins other local players, local airlines operating are Vietnam Airlines, Jetstar Pacific Airlines, Vietjet Aviation and Vietnam Air Services.

The carrier plans to operate up to 60 domestic flights per day with 37 routes connecting major cities and tourist destinations domestically and internationally. The first domestic routes will be Hanoi to Quy Nhon, Hanoi to Dong Hoi, HCM City to Quy Nhon, Hanoi to HCM City and HCM City to Van Don. The airline intends to expand its fleet to 40 to 50 by the end of this year. 

Established in 2017 with the charter capital of VND 700 billion (USD 31.4 million) and owned by FLC property and leisure group, the airway is part of the Viet Bamboo Airlines Company based in the city of Quy Nhon in Bình Dinh Province. FLC Group has positioned Bamboo Airways as a hybrid airline, blending low-cost traits with those of traditional or full-service carriers.

Being one of the fastest economic growth countries in Asia, Vietnam has recorded double-digit expansion in domestic and inbound passenger numbers. The government encourages tourism with visa exemptions and by promoting investment in the industry.

(Sources: Channel NewAsia; Vietnam News)

New Aviation Decree Aims To Ease Burden For Investors

November 2018

Vietnam business condtions for potential investors in the aviation sector will be simplified by a new governmental draft decree that has been sent to Prime Minister Nguyen Xuan Phuc for approval. To ease the burden on investors and raise the FDI in the field of aviation transport, the Ministry of Transport has adjusted the minimum capital amount when establishing and maintaining the businesses operation. An airline with less than 11 aircarft will need a minimum of VND 300 billion (USD 12.83 million), from 11 to 30 aircraft will need VND 600 billion, and 30 aircraft and more will need VND 700 billion. These numbers reflect a more than 50% reduction compared with the previous draft decision.

However, there are some conditions for foreign-invested enterprises, such as the foreign charter capital has to be less than 34% and the largest charter capital must be held by at least one Vietnam individual or legal entity. In case the Vietnamese person has foreign owned capital that is the largest charter capital amount, the foreign capital contribution shall not exceed 49 per cent of the Vietnamese person’s own.

(Source: Vietnam News)

Vietnam Airlines Extends Partnership With Thales

October 2018

Vietnam Airlines has chosen Thales to equip their new Boeing 787-10 Dreamliner aircraft with the AVANT inflight entertainment system. This agreement strengthen the existing partnership between Vietnam Airlines and Thales. The airline has previously selected Thales AVANT IFE system for their A350-900 XWB and Boeing 787-9 aircraft.

Vietnam Airlines has focused on developing its fleet by choosing the most technologically advanced aircraft while continuously improving service quality to meet the increasing demand of their passengers. The carrier flies to 50 destinations in 17 countries, with a fleet of single- and twin-aisle aircraft. 

WhileThales is a key player in keeping the public safe and secure, guarding vital infrastructure and protecting the national security interests of countries around the globe with world-class technology, the combined expertise of 64,000 employees and operations in 56 countries.

(Sources: APEX, Markets Insider)

France and Vietnam Sign Joint Vision Statement On Defence Cooperation

September 2018

France and Vietnam signed a joint vision statement on 18 September 2018, on defence cooperation for 2018 to 2028, and an agreement on amending the Vietnam-France co-operation agreement signed in 2009, with the aim of deepening the defence bond between the two countries. 

Through the statement, the two countries are to promote common concerns, thus reinforcing and stepping up mutual trust and moving towards expanding co-operation, maintaining security and stability in the region and the world; ensuring compliance of international law, freedom of travel on land, sea and air routes; and coping with non-traditional security threats, with the impact caused by climate change and environmental degradation for security taken into account. To implement the above, the two sides will maintain regular visits and meetings at all levels; increase high-level exchanges and diversify mechanisms for bilateral consultations on international and regional security issues of mutual concern.

The two countries will intensify co-operation and mutual support at multilateral organisations and forums and foster the bilateral and multilateral partnership to contribute to promoting peace and security in both regions. They also agreed to support each other in capacity building and share experience in peacekeeping operations and strengthen collaboration in the fields of defence industry, military medicine and hydrography.

Lastly, the two sides will focus on enhancing co-operation in maritime security and safety, as well as non-traditional security issues; and exchanging experience and seeking new opportunities to co-operate in environmental security.

(Sources: Viet Nam News; Nhan Dan Online)


Vietnam Plans To Build Five New Airports In The Next 12 Years

August 2018

As Vietnam is forecast to become the world’s fifth fastest-growing aviation market in terms of international passengers and cargo, measures are needed to resolve infrastructure bottlenecks and improve service quality in order to meet the development needs. Many experts agree that Vietnam’s airport infrastructure is in a state of overload as a series of airports are facing the likelihood of being overburdened once again, soon after they have been upgraded and expanded.

In response to this, Vietnam plans to build five new airports in the next 12 years. Currently, the country has 23 airports, comprising 13 domestic and 10 international. It aims to have 15 domestic and 13 international airports by 2030. The Vietnamese government is targeting to build airports in areas with big tourism potential like Sa Pa, Van Don, Dong Hai and Chu Lai. These goals were announced as part of the adjusted planning on aviation transport until 2020 with a vision towards 2030.

The attractiveness of the Vietnamese market is reflected in the impressive revenue and profit growth of airlines in recent years. In 2017, the total passengers of Vietnam Airlines grew by 10%, while those of Vietjet Air surged by 22%. Vietnam Airlines plans to increase its fleet to 116 in 2018 and Vietjet to 200 by 2023.

(Sources: Viet Nam News, Nhan Dan Online)

Vietnam Inaugurates Its First 4-Star Airport Terminal

July 2018

Cam Ranh International Airport in the central province of Khanh Hoa officially opened a new terminal for international services on June 30th, becoming the first airport terminal in the country to be built upon 4-star international standards. The star ratings are awarded by air transport rating organisationSkytrax, based on crtieria such as process efficiency, terminal comfort and cleanliness, passenger facilities and staff service. 

With constructon that ran for 19 months, the first phase of the new T2 terminal cost more than VND 3.7 trillion (USD 164 million).The three-storey terminal sits on a site of over 50,000 sq.m. and is designed to shape like a swallow’s nest – a specialty and symbol of Khanh Hoa. 

T2 terminal is capable of serving 2.4 - 4.5 million passengers each year and after the second phase completes, its capacity will reach 6 – 8 million passengers per year by 2030. The new terminal  was built to ease the overloading of Terminal 1. 

Cam Ranh International Airport is the main aviation gate to the popular sea resort city of Nha Trang, the central coast province of Khanh Hoa. Last year, tourist arrivals in the city reached 5.5 million.

(Sources: Online Newspaper Of The Government Of The Socialist Republic Of Viet Nam, VietnamPlus (Vietnam News Agency)

New International Airport To Open In Quang Ninh Province Of Vietnam By December 2018

June 2018

The Van Don International Airport, a new international airport in the northeastern province of Quang Ninh in Vietnam is set to open by December 2018. 

Its construction began in 2015 with a budget of USD 330 million (VND 7.5 trillion), and it is the first airport in Vietnam built under a Build–operate–transfer (BOT) scheme. 

Serving both civil and military flights, by 2020, the 326 hectare airport will:

  • House a level-4E airport and a level-II military airport.
  • Have a 3.6km long runway, capable of receive Boeing 777/787/747-400, Airbus A350 and similar aircrafts. 
  • Have the capacity to receive 2 to 2.5 million passengers, projected to increase further to 5 million by 2030. 

In terms of facilities, Van Don International Airport will have support facilities, a two-module terminal and functional areas. A cargo terminal is expected to be built by 2030 with a capacity of at least 51,000 tonnes. The airport is strategically located as it is situated 50 km from World Heritage site Ha Long Bay., 120 km to Hai Phong, an industrial hub and largest port city in the north of Vietnam, 140 km from Mong cai, a key border gateway to China and 180 km to Lang Son, a trading border gateway to China.

(Sources: Van Don International Airport, Voice of Vietnam Online (VOV.VN), Malaysian Digest)

Vietnam Airlines and Singapore's ST Aerospace to Establish JV

May 2018

The national flag carrier of Vietnam, Vietnam Airlines and Singapore Technologies Aerospace Ltd (ST Aerospace), a subsidiary of ST Engineering Ltd, signed a Memorandum of Understanding (MoU) in late April to establish a joint venture (JV) for aircraft maintenance and implement a contract to supply spare parts.

The JV is to be headquartered at Noi Bai International Airport in Hanoi and will specifically provide component Maintenance, Repair & Overhaul (MRO) solutions, with an average capacity of handling 17,500 pieces of machinery each year. Beginning with support for technology groups such as pneumatics, hydraulics and electrical components, the collaboration will be subsequently expanded to include aerostructure and airframe MRO.

The partnership will leverage Vietnam Airlines’ maintenance subsidiary, Vietnam Airlines Engineering Company (VAECO)’s existing facilities in Hanoi and Ho Chi Minh City, along with ST Aerospace’s core expertise in MRO to develop these facilities and their capabilities.

The two companies have also entered into a 14-year component Maintenance-By-the-Hour (MBH) contract that will support the airline’s whole fleet of 58 A321CEOs and 20 A321NEOs, including other A321s that will be delivered, in component maintenance starting from mid-2018. Under the MBH contract, ST Aerospace will set up an inventory base in Vietnam to provide timely services to Vietnam Airlines.

Additionally, the two sides will also continue to study and expand the scope of cooperation, maintenance, training, and exchange of aircraft technical personnel.

Conducting maintenance and repairs in Vietnam, instead of abroad, will reduce the turnaround time for Vietnam Airlines, thereby saving costs and creating higher operational efficiency.

(Sources: Vietnam Economic Times, ST Engineering Ltd)

Air France To Maintain Engines For Vietnamese National Airline

April 2018

Air France Industries KLM Engineering and Maintenance (AFM KLM E&M) and Vietnam Airlines have signed an agreement, in which AFM KLM E&M will maintain GEnx engines of Vietnam Airlines for 12 years and provide this carrier with spare engine access to guarantee seamless operations of the latest generation fleet, 19 Boeing 787 Dreamliners. The agreement is said to be worth USD 500 million and was witnessed by General Secretary of the Communist Party of Vietnam Nguyen Phu Trong, who was on an official visit to France on the last week of March. 

Vietnam airlines is the only Vietnamese carrier to operate direct route between Vietnam and France since 2004. This agreement is part of a strategic partnership which was signed between the two organizations in late 2017, and is considered as an important milestone for Vietnam's aviation sector in terms of economic cooperation between the two countires. The number of passengers to and from France has increased sharply, by around 500%, during past two decades. 

(Source: AirFrance Industries; Vietnam Customs News)

Airbus To Supply Airplanes To Vietnamese Startup Carrier

March 2018

Bamboo Airways, a new local airlines in Vietnam, is going to receive 24 A321neo aircrafts from Airbus' best-selling A320 Family. The Memorandum of Understanding (MOU) worth up to USD 3 billion has been signed between FLC Group - the holding company of Bamboo Airways and Airbus. Deliveries of full 24 A321neo will run through to 2025 for Bamboo Airways' early development stage. 

Per Bamboo Airways, the acquisition of A321neo will enable them to combine comfort, efficiency and the right capacity for its planned services, which will primarily serve the fast growing leisure markets in Vietnam.

Established in 2017, Bamboo Airways will commence their operation in 2019 with aircraft on lease until they receive their aircrafts from Airbus. This airlines aims to have direct international flights to Vietnam's tourist destinations where there are FLC projects of FLC Group in addition to the domestic routes connecting tourist sites.

(Sources: Airbus, Vietnam's Business News)

Investment Opportunities To Be Opened In Vietnam's Aviation Sector

February 2018

Vietnam’s Ministry of Transport (MoT) has announced it plans to spend USD 15.4 billion to develop the country’s aviation industry in the period 2018 - 2030. The newly adjusted master plan will focus on upgrading commercial airports and aircraft fleets development. The gorvernment aims to make Vietnam's aviation market among the top four leading countries in South East Asia.

Under the plan, Vietnam will add 7 airports to the current number of 21 in operation to accomodate 308 million passengers. Terminal and runnway expansion as well as facilities upgrade will be applied to major international airports such as Tan Son Nhat (HCM City), Noi Bai (Hanoi) and Da Nang (Da Nang City) to improve the overcrowded situation and attract more flights from the region. 

The country's airfleet is projected to grow to 400 units by 2030, of which 230-250 belongs to the state-owned airlines (Vietnam Airlines curently owns 93 aircrafts). Development will focus on new aircrafts exploited for transcontinental flights to enhance competitiveness on flight routes to America and Europe. Vietnam's government also aims to create favorable conditions for private domestic airlines in order to meet the increasing demand in the market. At the moment, 3 enterprises are investing in facilities while waiting for government's approval to put their first commercial flight into operation. 

(Sources: Voice of Vietnam; Vietnam Business)

Plans To Upgrade Vietnam's Airports

January 2018

In 2017, Vietnam welcomed more than 94 million air passengers, which is 16% more than the previous year. All airports across Vietnam hosted more than 800,000 flights from 67 foreign and 4 Vietnamese carriers. These statistics marked 2017 as the busiest year in Vietnam's aviation history to date and also placed stress on the country's airport and air traffic capacity. Civil Aviation Authority of Vietnam (CAAV) recorded 1,150 cancellation cases and more than 14,000 delayed flights within the year.

Rapid expansion has been made in major airports including buidling more terminals, runways and making space for aircrafts accomodation. Low budget carriers are seeking approval to increase their fleets to serve more passengers and reduce technical problems. The Airports Corporation of Vietnam (ACV) and Viet Nam Air Traffic Management Corporation (VATM), the two government owned companies in charge of airports management, have submited plans to upgrade the nation's services.

(Sources: VnExpress; CAAV's reports)



Poland Builds Search-and-Rescue Ships For Vietnam

December 2017

The Polish government has signed a loan agreement with Vietnam to support the construction of six large Search-and-Rescue ships (SAR) for the Vietnam Coast Guard. The project, which is worth USD 235 million, will be coordinated by Cenzin, a Polish trading company representing the Polish Armaments Group (PGZ). According to the agreement, the first two ships will be built by Polish company Remontowa Shipbuilding, which is based in the city of Gdansk. The company will transfer techonology and equipment kits to Vietnam to finish the remaining four ships. The project will start in 2018 with expected execution time to be 4 years, but can vary depending on the actual progress in each stage. After Cenzin's help with the creation of a research infrastructure for the Vietnamese Maritime University, this is the second Polish project in Vietnam.

(Sources: Baodatviet; Defense studies)

Vietnam's National Carrier Looking For Investors

November 2017

Vietnam Airlines Corp. is looking for an additional foreign investor (including possibly another airline) as it prepares a listing on the Ho Chi Minh City Stock Exchange next year. Currently, the government has a 86% stake in the carrier, but plans to cut its holdings to 51% by 2019 or 2020. The carrier - which sold an 8.8% stake to Japan's ANA Holdings Inc. last year for USD 108 million - is discussing the sale of another 4.1% stake as early as this month with potential investors. According to the company, the share sales will enable Vietnam Airlines to continue implementing an ambitious investment plan of expanding and upgrading its fleet and improving overall service quality.

Vietnam Airlines is expanding its fleet in an air-passenger market that the International Air Transport Association estimates will be among the world’s top five fastest-growing in the next 20 years.The carrier expects the number of international air passengers to Vietnam to be around 32 million in 2018, a 12% increase from this year. The airline forecasts that domestic travelers by air will rise 12% next year to 35 million, as economic growth makes travel affordable for more Vietnamese. The government forecasts Vietnam’s growth at 6.5% to 6.7% next year, among the fastest pace worldwide.

(Source: Bloomberg)

Vietnam State Enterprises To Trade In Military Weapons

October 2017

The Prime Minister of Vietnam may soon have the jurisdiction to allow certain state-owned enterprises to trade in military weapons, equipment and technologies, according to a draft decree on military weapon trade prepared by the Ministry of Defense. This move is believed to encourage more local investment and new technology to enhance Vietnam's national defense capabilities. Under the decree, the Ministry of Defense and Public Security will have jurisdiction to manage state-owned companies trading in military equipment and to approve contracts, agreements, and plans of production of weapons and equipment used for national defense and security. 

State enterprises will only allowed to purchase, sell, import or export military weapons with the Prime Minister’s permission. The draft decree stipulates that the weapons, equipment and technologies must be used for national defense and security purposes only, and that the trade must be in line with the international treaties to which Vietnam is a signatory. Military weapons, equipment and components will have to meet national standards and have sufficient information on the country of origin, year of manufacture and date of expiration, type, code and label. Additionally, enterprises allowed to trade in military weapons would be required to have equipment, technologies and production tools meeting technical standards, and have experts, engineers and employees proficient in the field.

(Source: The Saigon Times Daily)

USD 2 Billion Investment for Vietnam's Airports

September 2017

The Airports Corporation of Vietnam (ACV), who manages and operates 22 airports across the country, is seeking the Ministry of Transport’s approval on plans to invest nearly USD 2 billion on expanding the capacity of seven major airports. This plan is to reach a target of 140 million visitors in 2021.

ACV is pondering whether to implement these infrastructure projects alone or joint ventures with domestic and foreign investors to balance the capital demand of USD 1.98 billion. The plans for the seven airports are as follows:

  • VND 8.2 trillion (USD 360.7 million) will go to Tan Son Nhat International Airport to build a new terminal, runways, and necessary infrastructure;
  • VND 12.15 trillion (USD 534.5 million) to upgrade the Noi Bai International Airport;
  • VND 3.67 trillion (USD 161.4 million) to extend the annual capacity of passengers and the cargo terminal of Danang International Airport; 
  • VND 4.35 trillion (USD 191.4 million) additional funds to build a second runway and extend the annual capacity of Phu Quoc International Airport ;
  • VND 2.25 trillion (USD 98.98 million) to expand the terminal with an annual capacity of five million passengers for Cam Ranh Airport.
  • VND 6.28 trillion (USD 276.3 million) as a total investment capital sum for building a five-million passenger capacity terminal in Chu Lai Airport
  • ACV conducting the pre-feasibility study to build Long Thanh International Airport. in Dong Nai province in southern Vietnam.

The Airports Corporation of Vietnam is expecting an influx of local and international tourist arrivals this year, with about 27 million international passengers and 64 million domestic passengers.

(Sources: Vietnam Investment Review; The Leader)

Vietnam’s Aviation Fees And Charges To Go Up To Support Airport Infrastructure

August 2017

Aviation fees and charges are about to increase to and from Vietnam starting October 2017 following the Ministry of Transport’s decision in order to cover for investments in the airport infrastructure and to improve service quality. The funding follows the report from Airports Corporation of Vietnam (ACV) that indicates that the country’s airport infrastructure needs a total investment of approximately VND 32 trillion  (USD 1.4 billion) for the period of 2016–2020.

The fees and charges to be affected by the increase are the peak hour take-off and landing charges for airline companies (5% – 15%), service charges and security fees. Airline companies have said that the increase will cause additional costs for passengers, however, due to the cheap flight rates, the impact of such will be negligible.

(Sources: Vietnam Economic Times; Vietnam Net)

Three New Passenger Airlines To Be Established In Vietnam

July 2017

Several enterprises have announced their plans to set up new passenger airlines in Vietnam. Vietstar Airlines, with a charter capital of VND 800 billion (US$40 million), is just waiting for final approval from the Vietnamese government to provide passenger and cargo transport services. It will offer domestic routes between northern and southern Vietnam and regional routes to northeast and Southeast Asian countries. On the other hand, another soon-to-be player is Malaysia's AirAsia which has just entered into a joint venture to establish a low-cost carrier in Vietnam. It is estimated that this will need an investment of VND 1 trillion (USD 44 million) and will start operating by 2018. Meanwhile, Vietnamese real estate and construction giant FLC Group is currently processing legal procedures to establish Viet Bamboo Airlines with a charter capital of VND 700 billion (USD 30.8 million). By 2018, it plans to start flying international visitors directly to tourist destinations in Vietnam. It is looking to buy 15 Boeing aircrafts, lease about seven aircraft from Airbus by 2018, and attract experienced aviation sector experts to prepare for the start of its operations.

However, as Vietnam’s largest airport, Tan Son Nhat International Airport in Ho Chi Minh City is undergoing expansion of its runways, parking space and two terminals by 2018, the Vietnamese government warned that permits for new airline operators in this airport will not be issued until these projects are completed.

(Sources: Vietnam Breaking News, Online News Paper of the Government)  

U.S. Companies Sign Deals With Vietnam

June 2017

13 deals worth over USD 8 billion were signed during Vietnamese Prime Minister, Nguyen Xuan Phuc’s for a three-day trade focused visit to the United States with U.S. President Donald Trump. The U.S. companies signing the deals include GE, Caterpillar, and Honeywell. Below is some of the details of the deals:

  • GE agreement includes deals in the power generation and aircraft engines and services sectors. GE together with CFM international (a joint venture of GE and Safran SA of France) has an agreement with Vietjet Aviation JSC VJC.HM for 20 jet engines. GE power unit also signed a memorandum of understanding with state energy group PetroVietnam to build two 750-megawatt gas fired turbine power plants. GE also signed a joint agreement to build a 800-megawatt wind power facility with Phu Cuong Group and International Mainstream Renewable Power.
  • Caterpillar and its dealer in Vietnam agreed to provide generator management technology.
  • Honeywell agreed to supply Vietjet with 98 auxiliary power units for Vietjet Air’s new fleet of Airbus and maintenance for 12 years.

(Sources: Today, The Star Online, Reuters)

Vietjet Goes Global

May 2017

Vietjet, Vietnam’s low-cost domestic carrier will become the nation’s first company to list its shares on stock exchange overseas. Vietjet’s founder, Nguyen Thi Phuong Thao has been approached by some foreign stock exchanges from London, Hong Kong and Singapore on their interest in the company’s stock. She also feels that going listing overseas will increase the company’s access to more fund sources, boost its trading stock and expand the list of investors. She believes that more opportunities will be created as a result of a larger number of foreign investors to help boost local aviation industry and domestic stock market. The company will have a chance to expand and integrate faster into international aviation markets.


(Sources: Bloomberg, Boston Globe, iFly Global)

Two Russian Gepard-3.9 Frigates For Vietnam In 2016

April 2017

The People’s Army of Vietnam Navy (PAVN) will receive from Russia 2 Gepard 3.9 (Project 11661) frigates in the third quarter of 2016, after their launch in April and May 2016 and basin trial later. The first two Gepard class frigates were received by the Vietnamese Navy in 2011. The third Gepard class frigate will be set afloat for trials while the 4th is still under construction.

A further two ships were ordered in 2014 bringing the total order up to six vessels.  The Russian Gepard-class frigates (Project 1166.1) is a class of frigates intended as successors to the earlier Koni-class frigates and Grisha, and Parchim-class corvettes. Over the past years, Vietnam navy has been boosting its defence capabilities with the acquisitions of Russian Kilo-class submarines, Gepard-class guided missile stealth frigates and Svetlyak-class fast patrol boats.

(Sources: Asean Military Defense Review, Navy Recognition)

Vietnam’s Defense Cooperation

April 2017

During a meeting in Vietnam with Indonesia’s Chief of Staff of the Indonesian Air Force, General Hadi Tjahjanto, Vietnam’s Chief of the General Staff and Deputy Minister of National Defense, Lieutenant General Phan Van Giang, confirmed good outcomes between the two countries’ defense cooperation over the years ever since the signing of the Memorandum of Understanding on bilateral defense cooperation in 2010. General Hadi Tjahjanto hoped to focus more on delegation exchanges, share experience in repairing and maintain aircraft and air force equipment, pilot training and aviation rescue.

On the same day, Vietnam’s Deputy Chief of the General Staff, Senior Lieutenant General Nguyen Phuong Nam met up with Colonel Buntau Thoongmanila, Deputy Head of the Department of Military Training of the General Staff of the Laos People’s Army. The later has hopes that the two countries cooperation will be promoted in due time.

(Sources: Vietnam Breaking News, People’s Army Newspaper)

Big Growth And Challenges For Vietnam’s Aviation Sector

March 2017

Vietnam aviation is one of the top sectors for development by its government and many investors are expressing interest in the market.

There is an increase of 29% of passengers travelling by air in 2016, contributed by the opening of international air routes and the use of more domestic low cost carries. This trend is expected to continue in 2017 especially in the domestic market.  With the strong growth in the domestic market, Vietnamese air carriers have been buying new aircraft, opening new air routes and launching sales promotion programs.

(Sources: The Asian, Vietnam Net Bridge)

Saigon’s Tan Son Nhat Expansion

February 2017

Saigon Tan Son Nhat secures 21 hectares of land from the Ministry of Defense that was reserved for military cargo planes and helicopters, to start an expansion project in raising the airport’s annual capacity to 45 million passengers yearly.

The current airport has a design capacity of 25 million passengers per year but last year in 2016 the airport has been serving 32 million passengers, exceeding its capacity. The airport is constantly overloaded with its limited parking aprons of 50, falling short of the demand of 67 parking spaces. The country has plans to build a massive airport in Dong Nai province to take pressure off Tan Son Nhat .  

(Sources: VN Express International, Tuoi Tre News, Saigoneer)

Airports Corporation Of Vietnam (ACV) To Sell 20% To Frenc Aeroports De Paris

January 2017

The only operator of Vietnam’s 22 airfields, Airport Corporation of Vietnam (ACV), is on its way to signing its 20% sales agreement to French Aeroports de Paris (ADP) as its sole foreign strategic shareholder at the end of January.

The Ministry of Transportation who holds the controlling stake at 95.4% in ACV has agreed to ADP becoming their shareholder. ADP is the second foreign investor in Vietnam’s aviation industry following Japan’s ANA holdings who acquired 8.8% of Vietnam Airlines.

(Sources: Deal Street Asia, Vietnam Investment Review)

Vietnam To Launch Two Radar Satellites

December 2016

Vietnam is set to launch two radar satellites in 2019 and 2022, marking the country’s major advancement in space technology. The two satellites will be Vietnam’s first to employ radar technology which allows for higher-resolution image capturing in all weather conditions.

LOTUSat-1 and LOTUSat-2 are part of a USD 600 million project to establish the Vietnam National Satellite Center (VNSC) in Cau Giay District, Hanoi, which will be the country’s biggest science and technology project. Each of the satellites is designed to weigh 600 kilograms and to have an orbital lifetime of five years. They can capture images of objects on the earth surface measuring as small as one meter in size. The satellites will be tasked with monitoring and giving out early warnings on weather hazards, as well as keeping track of fish migration at sea to aid Vietnam’s fishing industry, according to VNSC director.

Once launched, the satellites are expected to help save as much as USD 150 million a year in disaster-caused damage on the country’s crops, according to experts at the Japan International Cooperation Agency (JICA).

(Sources: VNExpress International, Tuoi Tre News)

Vietnam Defense Expenditure

November 2016

Vietnam has seen some of the highest and steadiest increase in military expenditure in the region, with military spending increasing by 400% between 2005 and 2014. Its military expenditures totaled USD 4.4 billion in 2015, or 8% of total government spending. The country’s military budget is expected to climb to USD 5 billion in 2016, and then to USD 6.2 billion by the year 2020. The country was number 12 on the list of top arms importers in the world between the years 2010 and 2014 with around 80% of its military purchases coming from Russia, with whom they have had strong ties since the Cold War.

The country has developed one of the largest navies in the region, with advanced Kilo-class submarines, and a sophisticated missile force. Vietnam may be looking to add billions of more dollars into their weapons cache, particularly for naval combatants, aerial defense systems and intelligence, and surveillance and reconnaissance (ISR) equipment.

Vietnam is also concentrating on modernizing its maritime capabilities. Its key national security pillars include protection of its maritime sovereignty and maritime economy. The country has earmarked an estimated USD 1.6 billion for maritime defense purchases in 2016, which is set to increase to USD 2 billion by 2020.

Vietnam has also been continuously upgraded its defensive missile systems. It put in place two batteries of the K-300P Bastion coastal missile system in 2011, and two batteries of the S-300 PMU-2 long-range surface-to-air missile systems in 2012. In 2014, Vietnam upgraded both its short-range surface-to-air missile systems and their coastal missile systems. The military has also been boosting its coastal radar surveillance systems since 2013, and successfully built its first unmanned aerial vehicle in 2013.

(Sources: ITA, US Dept of Commerce)

Vietnam’s Tan Son Nhat Airport Announces Expansion Plan

October 2016

The Civil Aviation Authority of Vietnam (CAAV) has made changes to the master plan for the Tan Son Nhat airport in order to accommodate future passenger growth. Under the plan approved by the transport ministry, the eight-hectare expansion at Tan Son Nhat airport will increase its aircraft parking capacity to 82, twice the current number and airport aprons from 40 to 54. The airport terminals will be upgraded to increase the passenger capacity to 25 million passengers a year by 2020. The first phase of the project is expected to commence in 2019.

(Sources: Vietnam Asia Life, The Saigon Times)