BUSINESS IN BRIEF 10/6
Strong
effort needed to reach nation's credit growth target
Lending
by the banking sector must grow by 1.25 per cent per month for the rest of
the year if the country hopes to meet its full-year target of 12 per cent,
according to a National Financial Supervisory Committee report.
"It
is a difficult task," said committee chairman Vu Viet Ngoan, pointing
out that enterprises' capacity to absorb capital remained limited, the real
estate market was still troubled and the economy's aggregate demand continued
to be weak.
Dao
Van Hung, director of the
"The
lending market will take at least four to six more months to recover,"
Hung said, adding that any hurry might cause negative impacts.
According
to economic expert Vu Dinh Ang, lowering interest rates was not "the
cure to all diseases" of enterprises.
"Lowering
interest rates does not mean credit growth," said Le Xuan Nghia, a
member of the National Financial and Monetary Policy Advisory Council.
Despite
the interest rate cuts, enterprises still seemed reluctant to borrow capital,
according to Cao Sy Kiem, president of the Viet Nam Association of Small and
Medium Enterprises.
To
achieve the credit growth target, it was important to accelerate aggregate
demand and purchasing power, clear inventories and resolve bad debts, all of
which required determination from the Government, he said, adding that
enterprises also needed to hasten their restructuring.
As of
May 22, total lending by the whole banking system increased by 2.3 per cent
over the end of last year, according to the State Bank of
Legal
capital threshold for labour subleasing
On May
23, the Government issued Decree 55/2013/ND-CP for the implementation of
Clause 3 Article 54 of the Labour Code regarding the labour subleasing,
escrow deposit and a list of jobs for which labour may be subleased.
Accordingly,
the enterprises wishing to be granted with a Licence for labour subleasing
must satisfy conditions, such as:
.
Paying an escrow deposit of VND2 billion and maintaining the same amount of
charter capital during the whole operation;
. The
location of head office, branches and representative offices must be stable
and terms of this location must be two years or more.
. The
head of the enterprise, branch and representative offices must have a working
experience of three years or more in labour subleasing.
This
Decree also provides that the jobs for which labour may be subleased include
translation, compiling, shorthand, secretary, administrative assistant,
receptionist, tour guide, sale assistant, project assistant, producing system
programmer, building or factory cleaner, bodyguard, drive.
The
labour subleasing purports to temporarily meet unexpected increases in human
resources, to replace employees during maternity, accidents, occupation
health leave or matching demand for employing workers with highly technical
and professional level.
The
Decree further provides some cases in which labour subleasing is prohibited,
such as enterprises currently having labour disputes, strikes, replacing
dismissed employees because of changing structure, technology or merger,
division, separation of enterprise; providing the labour subleasing to work
in server condition.
The
maximum period for labour subleasing is 12 months. When this period is over,
the sublessor is not allowed to continuously sublease to the sublessee the
employee who has just ended up the sublease period.
This
Decree shall take effect from July 15, 2013.
New
principles for wage scales
On
May14, 2013, the Government issued Decree No. 49/2013/ND-CP guiding the
implementation of a number of Articles of the Labour Code on wages.
The
Decree stipulates principles for setting up wage scales and payrolls. In
detail, beside the regulation that the lowest wage level of the most simple
work or title in normal labour conditions must not be lower than the region-based
minimum wage level prescribed by the Government, the Decree also stipulates
that the lowest wage level of the work or title requiring employees to be
vocational trained (including employees trained by enterprises themselves)
must be at least seven per cent higher than the region-based minimum wage
levels prescribed by the Government; the wage level of work or title with the
heavy, hazardous and dangerous working conditions must be at least five per
cent higher than the wage level of work or title of equivalent complexity but
in normal working conditions, and at least seven per cent higher for those
working in specially heavy, hazardous and dangerous working conditions.
Besides,
when formulating and applying the wage scale and payroll, the principle of
equality and nondiscrimination must be ensured.
Under
the new Decree, enterprises must apply experimentally their newly set labour
norm before it is officially promulgated. Enterprises must adjust their
labour norm if the actual productivity is five per cent lower or 10% higher
than the assigned norm, or the actual performance during a given time period
is 5% higher or 10% lower than the assigned norm.
This
Decree takes effect from July 1, 2013. However the Decree provides that the
provisions therein shall be applied from May 1, 2013.
Local
firms see sweet opportunities
The
European Commission has decided to lift the import tax for a quota of 400,000
tonnes of refined sugar imported into the European Union during 2013-14,
according to the Ministry of Industry and Trade.
This
would be an opportunity for domestic sugar companies to reduce inventories,
which amounted to over 300,000 tonnes, the ministry said.
But
the ministry also noted that increasing sales in such a large market would be
difficult for local sugar firms, which had been exporting small quantities
for many years.
Measures
urged to lure foreign investment in stocks
The
State Securities Commission should consider several changes on the stock
market to lure foreign capital, such as applying a T+0 or T+1 settlement
period and restructuring companies.
The
opinion was voiced by the capital market working group on the sidelines of
the Viet Nam Business Forum (VBF).
Dragon
Capital director Dominic Scriven, a representative from the group, said the
Vietnamese stock market showed signs of recovery, but the rally could not yet
be called sustainable.
Foreign
investors were interested in the market, but still observing and waiting for
more opportunities, he added.
Although
trading hours were extended until 2.15pm from March last year, it was not the
key to boost liquidity.
The
main issue, according to experts, was shorter time for stocks to come to
investors' accounts. In September last year, the settlement period was
shortened from T+4 to T+3. However, investors asked for further improvements.
One of
foreign investors' biggest concerns was the efficiency of securities
companies. "The number of 105 companies is too many, while in practice,
only 10 leading firms have taken over 50 per cent market share," the
group stated in a report. "The rest of the pie for 95 companies was too
small to maintain operations."
Therefore,
the securities commission should promote the restructuring of brokerages to
assure the benefits of foreign investors when opening accounts in these
companies.
VinaCapital's
Terry Mahony highlighted state-run enterprises' (especially in the
telecommunications and banking sectors) equitisation as a method to attract
foreign investors.
By
law, businesses must list shares within 12 months of equitising, but the
regulation is still not completely adhered to. Meanwhile, Mahony urged for
listing to be mandatory within just one month of equitisation.
To
improve trading liquidity, the working group also suggested changes in the
price fluctuation limit for stocks (currently 7 per cent on the HCM City
Stock Exchange and 10 per cent on the Ha Noi Stock Exchange).
The
working group proposed to halting trading within 30 minutes when share prices
approached their ceiling or floor prices. After the half-hour pause, these
ceiling or floor prices would become the new reference prices.
The 7
per cent and 10 per cent amplitudes were a bar to the natural circulation of
cash, the group said.
The
commission vice president Nguyen Doan Hung responded that the agency was
working on these issues in accordance with the stock market's strategic
development by 2020.
An
international exhibition on equipment, products and supplies for the medical
pharmaceutical industries, hospitals and rehabilitation facilities will
return to
Pharmed
and Healthcare Vietnam 2013 will be held at the Sai Gon Exhibition and
Convention Centre in
The
exhibition, organised by Adpex Joint-Stock Company, will exhibit medicine and
healthy foodstuff, pharmaceutical manufacturing and packaging equipment,
diagnostic equipment, hospital furniture and beauty-care equipment and
products.
Several
conferences and seminars on hospital waste and waste water treatment, as well
as plastic surgery and the pharmaceutical industry, will be held alongside
the four-day event.
Power
plant operator negotiates selling price
The
operator of Nhon Trach 2 power plant is in negotiations with Vietnam
Electricity Group (EVN) to raise its power selling price, which currently
stands at VND1,200 a kWh, said a top executive.
Hoang
Xuan Quoc, general director of PetroVietnam Power Nhon Trach 2 Joint Stock
Company, told the Daily last week that since joining the competitive power
market, EVN has bought power of the plant at a price lower than VND1,400 per
kWh offered to other power plants.
Nhon
Trach 2 plant worth US$706 million has a capacity of 750 MW and each year
uses around 800 million cubic meters of gas supplied from Nam Con Son gas
field. The plant produced 4.6 billion kWh and earned revenues of VND5.45
trillion from selling power last year.
According
to Quoc, many other gas-fired power plants are selling power at low prices to
EVN, sometimes at as low as a few
Currently,
the power ceiling price is set by EVN, and it is unlikely that the price will
exceed the ceiling price after negotiation. As the sole power buyer, EVN
wants to buy power at low prices to earn more profits.
Therefore,
the situation will be different if there are three to four power buyers, Quoc
noted.
Regarding
the gas supply for gas-fired power plants in southern
Sugar
inventory continues to rise
According
to the Ministry of Agriculture and Rural Development and the Ministry of
Industry and Trade, sugar inventory increased to nearly 600,000 tons by May
end, about 222,410 tons higher than in the same period last year.
The
Ministry of Industry and Trade said that sugar inventory has been increasing
since March because of slow consumption and excess supply from sugar
processing plants. The output this year has far exceeded that of previous
years.
Sugar
plants across the country have processed more than 15.8 million tons of
sugarcane to produce nearly 1.5 million tons of sugar, whereas domestic sugar
consumption is only 100,000 tons a month.
Next
sugarcane crop will bring in 200,000 tons of processed sugar by October, not
taking into account the volume of smuggled sugar coming in from
When
it comes to aquaculture, people usually think of coastal regions or the
Mekong Delta where shrimp and pangasius earn revenues of upto tens of
billions annually. However, recently people found mountainous regions in the
North and the highland provinces as suitable for breeding Russian sturgeon, a
fish variety of high economic value in the world.
In
2008, Russian sturgeon was bred in the Da Mi hydropower reservoir in the
central
The
breeding of this fish was a real breakthrough as the fish grows quickly. It
takes 8 to 10 years for the fish to weigh 15 kilograms in
Le Anh
Duc, Chairman of Vietnam Sturgeon Group, said sturgeons grow faster in
Breeding
in highly controlled environment in fresh water means that farmed caviar can
be of as good quality as that in the wild in the Caspian or Lagoda Lake in
Russia.
Currently,
Tam Long Da Mi Company, under the Vietnam Sturgeon Group, raised over 200
tons of sturgeon in 200 facilities. With its success in breeding, propagating
sturgeon and harvesting caviar, the Vietnam Sturgeon Group decided to invest
VND300 billion ($14 million) building labs, freezers and processing
factories.
Moreover,
the Group expanded breeding facilities to the central
At
present, sturgeon flesh consumed is 1,000 tons a year in big cities such as
On the
other hand, breeders understand that selling of sturgeon flesh is not the
aim. The price of white caviar is US$1,700 per kilogram, Siberi caviar $2,800
a kilogram,
Le Anh
Duc said Russian holidaymakers are very fond of having the fish when in
In
addition, due to rampant overfishing in the
The
group has signed a Memorandum of Understanding with
Russian
sturgeon experts said that
High
inventory levels pose challenges to cash flow
High
inventory levels are attributed to low credit growth and an increase in
banks’ bad debts.
Many
commercial banks have reduced their interest rates after the State Bank of
Vietnam (SBV) decided to cut lending rates to a record low in more than three
years to help local businesses iron out snags in their current economic
difficulties.
However,
there is growing concern among the business community about the flow of
capital when the bad debt ratio remains rather high.
By
far, 15 of
Nevertheless,
domestic businesses still find it difficult to access bank loans due to
strict requirements from lenders.
Truong
Hoang Lan, Director of the Tien Phong Commercial Joint Stock Bank’s capital
department, says that many commercial banks are unwilling to offer loans to
loss-making businesses and those with bad debts. Therefore, the flow of
low-cost loans will only reach businesses that can operate with efficiency.
Banks
prefer providing incentive loans to businesses that can make a profit to
contribute to social welfare, Lan says, adding that those with poor
performance will be on the long waiting list.
Dr.
Tran Dinh Thien, Head of the Vietnam Economics Institute, says banks are also
like businesses and don’t want to face bad debts owned by inefficient
borrowers.
In
addition, he says, many businesses do not have feasible plans or solutions to
earn the trust of bankers.
Dr.
Thien argues that up to April 2013, the number of dissolved businesses
doubled from two years ago. Both banks and businesses are in a financial fix.
The
crux of the matter is how to devise effective measures to cope with the
situation but it’s no easy task for them all, he said.
High
inventories like a stumbling block to the flow of cash, have led to a high
ratio of bad debts for banks and a limit on credit growth.
Financial
storm ravages Cai Mep-Thi Vai ports
Delays
of port relocation and other planning snafus are causing major troubles
at southern Ba Ria-Vung Tau province’s Cai Mep-Thi Vai port complex, which
has been projected to become the largest transshipment port in the south.
SP-SSA
International Container Terminal is planning to temporarily close its
38-hectare terminal at the
State-owned
Vinalines last week reported this plan to Minister of Transport (MoT) Dinh La
Thang. According to Vinalines, the Ba Ria-Vung Tau province-based terminal
has to stop operating temporarily because of the cargo shortage at the Cai Mep-Thi
Vai port complex, and aiming to avoid bankruptcy. Vinalines reported the
joint venture between the
The
case of SP-SSA International Container Terminal illustrates how terminal
operators at the Cai Mep-Thi Vai port complex are in a very perilous
condition as they have suffered losses since last year. Five years ago, the
construction of terminals in this area was considered as the only way to ease
port congestion at ports in neighbouring
Five
terminals were put into operation in the complex including Cai Mep
International Terminal, SP-PSA International Port and SP-SSA International
Container Terminal, jointly invested by state-run Vinalines and Denmark’s APM
Terminals BV, Singapore’s PSA International and US’ SSA Marines,
respectively. The other terminals are
In
January this year, the Ministry of Transport (MoT) announced plans to open
another container terminal there, namely Cai Mep-Thi Vai International
Container Terminal. The new terminal will be under management of
Industry
experts warned that the slow pace of terminals’ construction in the Cai
Mep-Thi Vai complex would negatively affect economic development of the
country as ports in
Ngo
Minh Tuan, deputy director of
According
to the latest report of Ba Ria-Vung Tau Provincial People’s Committee, container
terminals in the area are operating at just around 15 per cent of their
throughput capacity, that mirrors a dire situation for terminal operators at
this time. The cargo volume transported through this complex last year
declined 6.5 per cent from 2011, forcing most of the terminals to reluctantly
accept bulk cargo to reduce losses.
The
reason is that these terminals were built to replace ports in
“We
now have to share a pie with terminals in
Nguyen
Xuan Ky, general director at Cai Mep International Terminal, said the
existing of too many ports in the south “deformed” port development master
plan in the region. Actually, at present, most cargo volume is still handled
through ports in
“There
are many reasons for shippers to keep on handling cargo via
Six
months ago, Infrastructure Working Group of Vietnam Business Forum, proposed
the Vietnamese government to stop opening another container terminal funded
by Japanese official development assistance in this area. In addition, it
also proposed to “immediately ceasing the licencing of all container terminal
building projects in
Local
exporters slowly regaining their mojo
The
export and import turnovers of
The
Ministry of Planning and Investment’s (MPI) data showed that local firms’
value of exports reached $20.2 billion, while that of imports touched $23.2
billion. In May, the turnover reached $4.3 and $5.4 billion, respectively,
resulting in a $1.1 billion trade deficit, down from April’s $1.73 billion.
Government
officials offered an upbeat assessment of the data. “Local enterprises’
export-import activities have seen signals of a recovery, manifested via
their trade deficit,” said MPI Deputy Minister Dang Huy Dong.
“The
trade deficit is a good signal of local enterprises’ health,” said Huynh Dac
Thang, vice head of the Ministry of Industry and Trade’s (MoIT) Export-Import
Department. “It means a production rebound as currently 70 per cent of inputs
for local production is imported. It is expected that the trade deficit will
continue in the coming months, due to a rise in industrial production.”
In
this year’s first five months, the index for industrial production (IIP)
augmented 5.2 per cent against last year’s corresponding period, when the IIP
had climbed 4.2 per cent over the previous year. Notably, the on-year IIP
rise for the processing and manufacturing industries was 5.5 per cent,
significantly higher than the on-year 3.8 per cent rise of last year’s
corresponding period.
Do Huu
Phuong, director of home appliance maker Hoang Anh Export-Import Company in
Hanoi, said the company’s imported materials like steel, plastics and cloth
in May climbed 15 per cent against April, when this rate augmented 10 per
cent on-month.
“During
this year’s first five months, the rate ascended 12 per cent against the same
period last year, when the rate went up 10 per cent on-year,” Phuong said.
Such
products imported by this company also saw good growth as prescribed in an
MPI report submitted to the government in May. It showed that the import of
steel increased 30.1 per cent in quantity and 16.3 per cent in value,
plastics increased 16.7 per cent in quantity and 16.1 per cent in value
($2.22 billion), cloth up 17.8 per cent ($3.3 billion) and garment materials
up 18.7 per cent ($1.48 billion).
Between
January and May,
Specifically,
FIEs occupied nearly 60 per cent of
If
crude oil exports are excluded, FIEs’ trade surplus would be $1.1 billion. If
not, their trade surplus will be nearly $4.1 billion.
During
this year’s first five months, FIEs have also exported 98.3 per cent of
phones, over 90 per cent of computers and electronic products, and nearly 70
per cent of footwear, according to the MoIT.
Fresh
energy for a new direction
Incorporating
green features in real estate projects has become increasingly popular.
Developers are embracing the strategy to boost the bottom line, improve their
brand and protect the environment.
Developing
green values in property projects has become trendy.
More
people have come to the perception that eco-friendly designs and greater
energy efficiency in buildings will help reduce not only energy costs and
greenhouse gas emissions, but also increase the value of their projects.
Just
last year, Vietnamese architect Vo Trong Nghia won two awards at the World
Architecture festival for his design of Binh Duong school in southern
“We,
the Vietnamese, need to think about climate change, so we should make a
house, a school, a building using less energy,” Nghia said.
But,
while green features in modern property projects in
Professor
Nguyen Quoc Thong, deputy chairman of the Vietnam Association for
Architecture, said the “green” features Vietnamese traditions, a smooth
combination that can be summed in three words: “People – Architecture –
Nature.” Even though the green features were applied differently by different
ethnic groups, the elements were used in every region of the country.
Rapid
urbanisation, however, has damaged the traditional architectural virtues,
producing unsustainable development that exacerbates problems. Energy costs
in
Urbanisation
has also created more traffic jams and environmental pollution- and all of
these problems, in turn, have produced a resurgence of green thinking.
“Green
architecture now becomes the current trend. It forces every developer,
investor and user to think about it,” Thong said.
The
number of buildings and projects which have green characteristics has been
increasing dramatically in recent years. Some high-profile projects have been
honoured by international and domestic design institutes for green attributes
such as Bamboo Wing in Flamingo Dai Lai, Suoi Re Commune House, Vietinbank
Hanoi building and Dolphin Plaza Hanoi and a range of resorts stretched along
the length of the country like Sai Gon Mui Ne Resort, Six Senses Hideaway
Ninh Van Bay and Ana Mandara Villas Dalat.
Thong
said the green features in these award-winning projects respected the needs
of the natural environment and human beings. “Green architecture is the
smooth combination between traditional knowledge and modern expertise, in
order to have a friendly environment comfortable for users,” he said.
Green
buildings also used green materials and technologies which have low carbon
footprint, are energy-saving and minimise the usage of natural resources.
Turner
International’s Jim Goldman, project director of
Green
features must appear in the project from early stage, when it was still on
paper, and solidly developed during the project’s process. “Planning for
success, start early,” he said.
Goldman
added that in the initial stage of green buildings in
Russ
Drinker, managing director of HOK - a global architect firm, said that
“Green
features must not be used on property only, but for all aspects of people’s
life, in an aim toward a more sustainable development,” Drinker said.
“With
thousands of under constructions and many other projects were pipelined in
the coming time,
Minister
of Construction Trinh Dinh Dung said
As
part of this effort, the Ministry of Construction (MoC) recently signed a
cooperation agreement with the International Finance Corporation (IFC) to
promote energy efficiency in buildings and reduce greenhouse gas emissions.
Accordingly,
the IFC will help the ministry develop procedures and the capacity to
implement the Building Energy Efficiency Code between 2013 and 2017.
This
agreement is expected to contribute to the implementation of the National
Target Programme on Climate Change Adaptation, the National Target Programme
on Energy Efficiency, and the National Green Growth Strategy.
Phu
Quoc pepper exporters spice up quality of products
Phu
Quoc island district in the southern
With
385 hectares of pepper plantations, mostly in Cua Duong and Cua Can communes,
Phu Quoc reaps nearly 1,000 tonnes of pepper a year.
The
locality plans to expand its plantations to 500 hectares by 2015 and 1,000
hectares by 2020, with expected yield of 3 tonnes per hectare.
In
2011, the National Office of Intellectual Property granted a licence to Phu
Quoc pepper, helping the district to affirm its product's traditional value
and quality while creating conditions for it to introduce its product to the
world market.
Phu
Quoc district is working on a pepper growing process in an efficient and
eco-friendly manner that it will train farmers on.
Local
officials said they were targeting clean and safe products to serve both domestic
consumption and exports.
According
to Nguyen Minh Truc, head of Phu Quoc's Economic Office, the locality
targeted organic and sustainable cultivation of pepper plantations while
promoting its brand name in domestic and foreign markets.
Apart
from local specialties such as pearls, seafood, fish sauce and wine, pepper
in Phu Quoc is developing in a sustainable manner in combination with
services and tourism, contributing to the locality's socio-economic growth.
Equitisation
of state-owned enterprises slowing down
During
a discussion about the equitisation of state-owned enterprises (SOEs) held on
June 3, the Vietnam Business Forum (VBF) said that there has been a slowing
trend.
Dominic
Scriven, CEO of Dragon Capital Group, remarked that the process has slowed
due to the slump in the stock market. The group suggested that the government
set new goals with specific timelines to help the market.
Scriven
specifically emphasised the importance of equitising the telecom and banking
sectors.
He
also outlined the need to determine the takeover value of the enterprise by
hiring private foreign consulting firms. Successful equitisation is ideally
beneficial to both investors and owners, and requires that there be a
sufficient amount of shares to be sold at attractive prices.
The
enforcement of mandatory listing is also key to the process. However, even
though the law states that SOEs going through equitisation must list within
12 months of the successful completion of the process, few firms have
followed this rule. VBF has confirmed that they have received suggestions
that SOEs be forced to list within one month of being equitised.
Terry
Mahony, Chairman of Vincapital, a fund management company, said the lack of
experience of managers for banking issues is one of the main causes for the
slow progress. If the bad debt problem is not solved, the economy's liquidity
will suffer, he added.
Current
estimates of bad debt in the system are generally seen as unreliable, proving
that the economy as a whole is in need of more transparency in financial
reporting. Mahony suggested that the government make bold policy moves to
reform the banking system and speed up equitisation of SOEs.
Cleantech
firms target new demand
Jean-Mann
Cho, president of Gmatek Company, which is
“If we
succeed in establishing a network of partners here, we will build a factory
here,” Cho said. “
Cho
said the use of foamed ceramic boards for construction could decrease the
area of agricultural land used for clay exploitation to make baked bricks,
thus helping ensure food security and limit environmental risks.
Gmatek
is among nearly 50 South Korean firms coming to
For
example, under the Ministry of Construction’s Circular 09/2012/TT-BXD
regulating the use of unbaked construction materials in buildings, by 2015,
unbaked construction materials must occupy at least 30 per cent of bricks for
buildings with at least nine floors, rising to 50 per cent in the following
years.
The
South Korean firms said
Bugok
Stainless and Kyoung Sung Industry companies also said they were expanding
their export networks throughout
“We
have met with 10 Vietnamese partners and deals may be signed. In our studies,
The
Vietnam Association for Building Materials affirmed
Among
the foreign firms already making presence in Vietnam’s construction material
market is Xella Group, a leading supplier of autoclaved aerated concrete
(AAC) and other sustainable building materials such as fermacell dry-lining
systems.
“Our
long-term goal is to have local production in
“We
believe that
Commenting
on the group’s performance in
Construction
material maker Boral Gypsum Vietnam (BGV) has been building a second
plasterboard production line in
Established
in
Meanwhile,
Popular
Chinese LED maker is ready to shine light on Vietnam
One of
At
last week’s fifth international exhibition on energy efficiency in
Hua Bo
Tech (Zhuhai), whose capital comes from
LED is
a semiconductor light source that is frequently used as indicator lamps in
many devices and are increasingly used for other lighting. It can save 30-90
per cent of power as compared to traditional lamps. “Hua Bo Tech (Zhuhai)
will invest five million dollars to build a factory focusing on manufacturing
products ranging from precise plastic components, vacuum packaging blisters,
mold/tooling design and fabrication, label and sticker processing, assembly
for OEM electronic products, solar-powered and energy-saving lighting
fixtures to LED lamps in
At
present, the company has decided to lease a production workshop at the lot.
This will be our first factory in
“One
of the reasons why we come to Vietnam for investment is that many of our big
customers like Panasonic, Samsung, Honda, Toyota, Cannon, Sony and Brother
Industries have been in Vietnam for years. And we don’t want to lose these
customers,” Chen said. “Also, the labour cost in
This
20,000-square-metre factory will employ about 600 local workers and it will
be expanded to 50,000sqm by late 2014.
The
factory will use imported materials to make over 200 types of LED lamps which
will be both locally-consumed and exported to Europe, Asia and
“LED
technology is becoming an important development orientation of
Hua Bo
Tech (Zhuhai) - www.famei.com.cn, is a member of China-based HUA BO Group,
which is a manufacturer of industrial equipment and machines. In
The
land area of Hua Bo Tech (Zhuhai) covers 68,000sqm, and the total building
area is 95,000sqm. Its main business scopes are precise plastic components,
vacuum packaging blisters, mold/tooling design and fabrication, label and
sticker processing, assembly for OEM electronic products, solar-powered and
energy-saving lighting fixtures.
Its
clean-room workshop covers over 2,000 square metres. It also has advanced
production facilities.
More
chances for sugar exports to EU
Local
sugar firms will have more opportunities to access the European Union (EU)
market after the EU scrapped import tariffs on some codes of the sugar import
list it is applying.
According
to the Europe Market Department of the Ministry of Industry and Trade, the
European Commission has issued a decision on customs quotas for industrial
sugar import this year and next.
Under
the decision taking effect last week, from October until September 2014, the
EC stops levying tariffs on 400,000 tons of industrial sugar having the code
1701 and the order number 09.4390.
According
to the Ministry of Industry and Trade, this creates a great chance for local
sugar refineries to boost exports to the EU.
Regarding
this issue, the director of a large sugar firm in the central region told the
Daily that the tax removal on up to 400,000 tons would help
However,
The
sugar volume of this crop is estimated at some 1.55 million tons, which is
50,000 tons higher than the figure forecast by Vietnam Sugar and Sugarcane
Association at the beginning of the crop and 300,000 tons higher than the
previous crop.
Kien
Giang accelerates key projects on tourism island
The
southern
A 2.4
trillion VND project to build a 51.5km road running along the North-South
axis on the island has disbursed 65.7 percent of investment, while the
construction of a 193.8 billion VND road that connects the axis road with the
sea, running from Ham Ninh intersection to Suoi Da village, also had almost
60 percent of the workload done.
Meanwhile,
the project to build a 100km-long road circling
At the
same time, the laying of a 110 KV undersea cable to bring electricity from Ha
Tien town on the mainland to Phu Quoc has seen 350 billion VND out of the
total investment of 1.759 trillion VND disbursed.
The
provincial authorities has urged Phu Quoc island district to work closely
with departments and branches to address difficulties facing investors and
contractors.
The
province has set up inter-sectoral supervisory groups to help Phu Quoc
accelerate the projects, especially newly launched ones and those using
official development assistance (ODA) capital and funds from Government
bonds, and those listed in the national target programme.
According
to the Southwestern Steering Committee, Phu Quoc may fail to fulfil the
target of becoming a third-tier urban district by 2015 and a special zone by
2020 as instructed by the Prime Minister, if steps aren’t taken to attract
investors soon.-
Bright
outlook for trade ties with Brazil
Total
bilateral trade during that time reaches 654.6 million USD of which Vietnam
’s exports were 349.5 million USD, an increase of 48.5 percent year-on-year,
according to Brazil ’s Ministry of Development, Industry and Foreign Trade.
Vietnam’s
exports to Brazil also saw a growth rate higher than the average growth rate
of exports to the US (12 percent).
Total
bilateral trade between Vietnam and Brazil ranks second, only after the US.
According
to Vietnam’s Commercial Affairs Division in Brazil, there are still many
opportunities for Vietnamese goods to penetrate this market.
Currently,
the market share of Vietnamese exports accounts for only 0.3 percent of
import demand in Brazil.
Last
year, Brazil’s total imported goods exceeded 225 billion USD, of which
Vietnamese exports worth 710 million USD.
At
many distribution centres and supermarkets, the presence of made-in-Vietnam
goods is visible.
However,
many Brazilian enterprises have yet to realise the production potential of
Vietnamese companies.
Brazil
is a huge market, with nearly 200 million people. It is the sixth largest
economy in the world, and its industrial sector is the most developed in
South America.
Thanks
to its economic growth and high loving standards, demand for imported goods
has increased.
In the
first four months of 2013, Brazils saw a trade deficit of 1 billion USD,
while in previous years, the country had a trade surplus.
Brazilian
consumers are fond of imported goods, so there are favourable conditions for
Vietnamese goods to access the market.
On the
other hand, market research specialists said that language was a barrier in
strengthening trade relations between the two countries, as few people on
either side spoke Vietnamese or Portuguese, the main language of Brazil.
In
addition, Brazil’s import procedures take along time and signed contracts
must be notarised in Brazil , which hinders Vietnamese enterprises.
Geographical
distance as well as cultural and time-zone difference are also obstacles.
To
overcome these challenges, Brazil opened a consulate earlier this year in HCM
City to support businesses look for partners and seek mutual understanding
about each other’s markets.
Currently,
Vietnam exports seafood, footwear, electronic parts, textiles and garments to
Brazil .
Brazil
also has great demand for cosmetics and medicine, two areas in which Vietnam
could increase exports. It is also seeking foreign investment in sectors such
as seaports, shipbuilding, oil and gas, and bio-fuels.
Total
bilateral trade between Brazil and Vietnam is expected to surpass 2 billion
US this year.
Unhealthy
competition becoming increasingly sophisticated
To
corner the market, not a few businesses are resorting to unhealthy or even
illegal competition.
According
to the General Department of Taxation statistics, there are more than 9,000
foreign directed investment (FDI) businesses operating in Vietnam, many of
which have positively contributed to national economic development.
However,
not a few are deliberately raising the trading values of input materials,
products, and services to create a “fake loss real profit” phenomenon and
avoid tax liability. Many domestic businesses had to withdraw from joint
ventures, which have been transformed later into 100 percent foreign-invested
companies.
Such
hard facts not only reduce corporate income tax revenue but directly affect
the performance of domestic businesses.
Vietnam
Beer, Alcohol, and Beverage Association President Nguyen Van Viet says
healthy market competition can fuel mutual development and benefits, but
unhealthy competition only drives a wedge between businesses, damaging
trademarks and reducing consumer trust.
Viet
emphasizes that unhealthy competitive practices violate consumer rights to
enjoy freedom of choice.
Former
Deputy Trade Minister Luong Van Tu says the majority of FDI businesses
operate by Vietnamese law, only some seek to reduce their tax burdens by
claiming to suffer losses from price transfer. To ensure healthy competition,
Vietnam should put up technical barriers in line with international trade
agreements. Domestic businesses should focus on earning the trust of
customers.
Tu
says defending consume rights is one way of ensuring a healthy and equitable
business environment.
Vietnam
has issued a Competition Law and a Law on the Protection of Consumer Rights
in the hope of encouraging healthy competition. Domestic businesses should
officially register and promote their brand names to give customers freedom
of choice.
Tran
Anh Son, deputy director of the Ministry of Industry and Trade’s Competition
Management Department, says underhanded competitive practices are becoming
increasingly sophisticated. Domestic businesses, customers, and authorities
must unite against unethical competition.
As
economists put it, there must be drastic measures to crack down on those
businesses violating or circumventing the Competition Law. Everyone is
responsible for making the business environment ever healthier.
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Chủ Nhật, 9 tháng 6, 2013
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