According to a recent Prime Ministerial decision, Vietnam will cease issuing new joint ventures licenses for beer production while existing foreign-back breweries are running at under 80% capacity.

New investment in carbonated soft drinks has also been halted though encouragement will be given to production in other sectors especially involving fruit based beverages. The government recommended new cooperation deals or partnerships be established to make high-quality alcohol from materials domestically available.

Under the new decision, Habeco and Saigon Alcohol, Beer and Beverages (Sabeco) are expected to take leading roles in the beer market next year. It calls for these two State-owned companies, which now hold a combined 40% market share, to hold 70% by 2010.

Two new breweries are to be constructed by 2005. One, under Hanoi Alcohol, Beer and Beverages Corporation (Habeco), is designed with an annual capacity of 100 million litres which can be expanded to 200 million litre. The other, under Sabeco, is a 100 million litre plant that can be expanded to 300 million liters at a later date. By 2010, the market share of the state-owned companies is expected to rise from 40% to 70%.

Vietnam has two wholly foreign-owned and three joint venture beer facilities behind international brands such as Heineken, Tiger, Fosters, San Miguel and Carlsberg. Vietnam Brewery, which brews Tiger and Heineken in Ho Chi Minh City, is Vietnam's most successful foreign brewery, recording a profit of more than $6 million each year.