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BUSINESS
IN BRIEF 27/9
Vietnam-France
trade grow considerably
The exchange of
goods between
As a European Union
(EU) member,
high rate in the
2008-2012 period.
However,
But in 2010, its
exports to
In 2012,
This was attributed
to a sharp rise in the export value of computers, electronics and components
to US$203 million, tripling the previous year’s
figure. Other items
of high export value included telephones and components (up 65 %) and coffee
(up 114%).
In 2012, total
imports from
means of transport
and other components by 111.8%, and milk and dairy products by 107%.
In the first eight
months of the year,
and components
while its imports were mostly pharmaceuticals, machinery and equipment, and
iron and steel.
Ha Tinh
calls for Japanese investment
Ha Tinh currently
ranks sixth in terms of foreign investment attraction, said mayor Vo Kim
Cu.
He was speaking at
a seminar which was jointly held on September 25 by the Japanese Embassy
Sumitomo Mitsui Bank and the Ha Tinh
provincial People’s
Committee as part of activities marking the Vietnam-Japan Friendship Year and
the 40th anniversary of bilateral diplomatic
ties between the
two countries in more than 100 delegates from
They were
encouraged to invest in the local support industry, transport, manufacturing
and infrastructure sectors.
The provincial
leader pledged to support Japanese investors, especially in administrative
procedures.
Hirokazu Yamaoka, a
representative from the Japan External Trade Organization (JETRO), suggested
localities like Ha Tinh should draw more Japanese investors into their local
development projects, especially in steel manufacturing.
Japanese businesses
are currently operating in 36 Vietnamese localities, but most of them in
seven biggest provinces and cities.
At the seminar,
three memorandums of understanding on investment and product supply were
signed between Ha Tinh and Japanese businesses.
Agro-forestry,
seafood exports earn US$20.45 billion in 9 months
Of this figure,
agricultural exports accounted for US$9.93 billion (down 12%), but seafood
exports earned US$4.61 billion (up 3%), and forestry product exports US$3.97
billion (up 12%).
Among high export
earners were pepper (112,000 tonnes worth US$743 million), cashew nuts
(188,000 tonnes worth US$1.19 billion), and tea products (101,000 tonnes
worth US$161 million).
Meanwhile, rice,
coffee and rubber exports went down in both volume and value.
Garment
sector lacking in material input
The local garment
industry enjoys high export revenue but depends largely on imported
materials.
According to
Le Quang Hung, Head
of the
He is ray concerned
about the current shipmembers of input materials to
Against this
backdrop, many material suppliers have raised prices by 10-15%.
As for businesses
applying free on board (FOB) models they find themselves in a difficult
position to buy adequate materials for production on order.
The current supply
of input materials is far from meeting the growing demand of the garment
industry.
Latest statistics
showed that
From January to
August 2013,
Local businesses
also had to spend billions of US$ importing materials from
Economist Pham Chi
Lan suggests the Government of Vietnam would better support local farmers in
developing material supplying areas for the
garment industry.
If not, she argues, the garment industry will be unable to meet strict
regulations on product origin when
agreements such as
the Trans-Pacific Partnership (TPP) Agreement with other countries outside
ASEAN region.
Seminar on
Vietnam-US aviation cooperation
A seminar was held
in
The event gave
Vietnamese and US experts a chance to share experience in managing airport
traffic, public-private partnership in aviation and certification of
airplanes.
US Consul General
in HCM City Rena Bitter said the US and Vietnamese Governments have enjoyed a
dynamic partnership in the aviation sector, noting that the seminar will help
US experts provide more support for Vietnam in this field.
The US Trade and
Development Agency (USTDA) has provided the Civil Aviation Administration of
Vietnam (CAAV) with over US$1 million to intensify efforts for safety
conditions. It has also funded many projects in
Poland’s
pharmaceutical firm set to operate in Vietnam
Polpharm- a leading
pharmaceutical group of
Polpharm’s
investment scheme and its already successful operations in the EU,
It will open a
representative office in
Rajmund I.
Martyniuk, Vice President of the Management Board and Commercial Director for
Polpharm Group, highlighted huge potential for his firm’s operation in the
Vietnamese market, which he described as a key location for expansion to
other ASEAN members.
Davlet Matkerimov,
Polpharma
Exports
fetch US$96.5 billion in nine months
According to the
General Statistics Office (GSO), FDI businesses contributed US$58.4 billion,
or 60.6%, to the figure. Their export earnings marked a 27% rise from the
same period last year.
In the nine-month
period, the country made a trade deficit of US$124 million or 0.1% of total
export value.
The FDI sector only
posted a trade surplus of nearly US$4 billion in the reviewed period.
Meanwhile, the
country’s import value is estimated to hit US$70 billion, raising the year’s
total imports to US$132 billion, a year-on-year rise of 14.5%.
Permanent Deputy
Secretary of the HCM City Party’s Committee Nguyen Van Dua issued the
statement at his meetings with General Secretary of the Argentinean
Communist Party Patricio Echegaray, Deputy Speaker of Buenos Aires City
Council Dante Gullo and Chairman of the
Vietnam-Argentina
Culture Institute Poldi Sosa on September 23-24 as part of his working visit
to the Latin American country.
The visit took
place at a time when
The
training, science
and technology, and international exchanges.
On the occasion, a
business forum was held by the Vietnamese Embassy in
Bilateral trade
between the two nations has grown in recent years reaching US$1 billion for
the first time in 2011.
In the first eight
months of this year, the two countries made a year-on-year soar of 48 percent
to US$1.1 billion in trade.
Viet Kieu
car imports must clear customs
Vehicles shipped to
This comes under
new regulations the Ministry of Finance recently proposed to the Government
with the aim to prevent people from taking advantage of the
Government’s Viet Kieu automobile import policies to make illegal profits.
Under the new
regulations, vehicles not re-exported within 30 days of the local customs
departments' decisions will be confiscated.
The Ministry of
Finance also ordered the General Department of Customs to inspect cars that
were currently stuck at ports. Those that were proven to be smuggled
would be treated as smuggled products in accordance with Article 45 of the
Law on Customs.
The owners of
vehicles kept at ports for more than 90 days would get notices. After another
30 days, if the receivers did not come to customs departments for
handling procedures, the cars would be sold and the money would go into the
State budget.
The number of
luxury vehicles brought in by repatriating Viet Kieu has rapidly increased,
with more than 1.140 cars in 2012 compared with 164 in 2011.
Central
bank issues regulations for VAMC
The State Bank of
The procedures
include the issuance, revision, adjustment and supplement of management
policies and regulations on VAMC’s activities, allowing the company to buy
bad debts at market value, approving its plans on bond insuance, financial
support for credit institutions and contributing registered capital and
equity.
Bad debts amounted
to 142.27 trillion VND (6.8 billion USD) or 4.64 percent of total loans by
Vietnamese banks at the end of August, a 20.15 percent increase since the end
of 2012, the SBV’s Inspection Agency reported.
According to Chief
Inspector Nguyen Huu Nghia, many measures will be taken to solve bad debts.
The SBV will direct credit institutions to apply measures to recover debt and
collateral and use provisions to settle bad debts and assets. It will also
coordinate with VAMC to implement bad debts transactions.
All such activities
must contribute to the objective of cutting the bad debts ratio to the safety
threshold of 3 percent by the end of 2015 as planned by the National
Assembly.
VAMC is expected to
eventually handle around 40-50 percent of the bad loans in the banking
system.
Woodwork
brands gather at
As many as 260
businesses from 19 countries and territories are attending the 10th Vietnam
International Woodworking Industry Fair (Vietnam Woodworking) in
The participation
of such wood processors’ organisations as the European Federation of
Woodworking Machinery Manufacturers (EUMABOIS), German Engineering
Association (VDMA), and American Hardwood Export Council (AHEC) is expected
to further consolidate
Domestic
enterprises, on their part, see it a chance to seek partners and advanced
technologies meeting their demands.
On display of this
year’ fair are modern machines and devices, advanced manufacturing systems as
well as services that are practical and suitable to the market’s needs.
Woodwork remained
During the event,
participants will discuss measures to ensure the sustainable production of
the local tea industry in order to improve quality and expand export markets,
said the Vietnam Tea Association.
Price of
paddy falls in Mekong Delta
The price of paddy
in the Mekong Delta has dropped drastically as more areas under rice
cultivation were flooded due to continuous heavy rainfall in recent days.
Fresh paddy
harvested by combine harvesters was bought at around VND4,200-4,250 per kilo
while fresh long-grain paddy was bought at VND4,600 per kilo.
As for fresh paddy
that was so deeply submerged underwater because of floods and heavy rains,
farmers had to harvest by hand, and for which price fell to VND3,500-3,800
per kilo for normal paddy, and to VND4,200-4,300 per kilo for long-grain
paddy.
Lam Van Teo, a
farmer in Thanh Loc Commune in Giong Rieng District of Kien Giang Province,
said that continuous heavy rains have sent several farmers into despair as
the cost for harvesting by hand was two times higher than that for harvesting
by harvesters. Meanwhile, paddy price plummeted steeply as wet and muddy
paddy is out of favor with traders. Under such circumstances, farmers will
suffer huge losses.
The Department of
Cultivation under the Ministry of Agriculture and Rural Development on
September 24 said that farmers in the Mekong Delta provinces have so far
grown autumn-winter rice crop on 790,000 hectares.
Farmers in Kien
Giang, Vinh Long, Dong Thap, and Can Tho City have harvested about 100,000
hectares of autumn-winter rice crop with an average productivity of 5-5.2
tons per hectare.
Counterfeit
fertilizer flooding local market
The Ministries of
Industry and Trade, Agriculture and Rural Development, Public Security, and
the Fertilizer Association of Vietnam held a conference to seek measures to
prevent counterfeit fertilizer from flooding the market.
According to Le
Quoc Phong, Vice Chairman of Fertilizer Association of Vietnam, three years
ago counterfeit fertilizers and trading in low quality fertilizers mainly
occurred in rural and remote areas and in a very small scale, including
faking famous fertilizer brand names.
Now, this illegal
practice is rampant and not only small and medium enterprises are involved
but even fertilizer and plant protection agencies can now produce counterfeit
fertilizers by a concrete mixer, fake genuine brands and circulate the
product without detection.
Major General
Nguyen Ngoc The, Head of the Department of Security, said that counterfeit
fertilizer was uncovered in 45 provinces across the country, including Thai
Binh, Nam Dinh, Can Tho, Dong Thap, Long An, An Giang, Tien Giang, Hoa Binh,
Thanh Hoa, Nghe An, Binh Duong, Dong Nai, Ho Chi Minh City, and the highland
provinces.
In the first half
of this year, police inspected more than 7,000 fertilizer and plant
protection agencies in the south and uncovered many wrongdoings, such as
counterfeiting fertilizers of well-known brand names, mixing rock dust into
fertilizer to increase weight, failing to show certificate of origin of
materials to produce fertilizer, and the quality of fertilizers failing to
meet standards.
Noticeably,
counterfeiting of fertilizer also occurs in foreign countries. In border
provinces, including Lao Cai, Ha Giang, Cao Bang, and Lang Son, police had
uncovered low quality fertilizers, mainly imported from
Recently, dishonest
traders also transferred packages of prestigious Vietnamese fertilizer
companies to
In 2012 and the
first six months of this year, police uncovered 1,390 violation cases,
slapped a total penalty of VND17 billion, and seized 917 tons of fertilizers.
Le Quoc Phong, who
is also a CEO of Binh Dien Fertilizer Joint Stock Company, said that as the
number of fertilizer counterfeiters increased, sales and market shares of
many big fertilizer companies were affected.
Nguyen Tan Dat, CEO
of Southern Fertilizer Company, said that NPK fertilizer was generally used
by farmers; hence, this product was counterfeited the most. The quality of
counterfeit fertilizers was only 70-80 percent compared to that of genuine
products. Thus, farmers have to pay at least 10 percent for low quality
fertilizers, not to mention fake fertilizers. With fertilizer consumption of
US$4 billion every year, farmers in
However, why did
not plant productivity decrease when farmers used low quality fertilizers?
Mr. Dat explained
that the area under agricultural land in Vietnam is equal to 70 percent of
that in Thailand but the amount of fertilizers used by Thai farmers annually
accounts for 80 percent of that used by Vietnam. This means that Vietnamese
farmers used too much fertilizer that they could not realize the impact of
low quality fertilizers on productivity. This perceptibly raised costs on
plants and created favorable conditions for counterfeit fertilizer to be effective.
Phung Ha, Head of
Vietnam Chemicals Agency under the Ministry of Industry and Trade, said that
compliance in granting license for fertilizer companies has made the
situation more complicated. Regulations and standards for fertilizers remain
vague while inspectors lack skills. Control on fertilizers is insufficient as
ministries fail to coordinate with each other.
The ministries and
Fertilizer Association agreed that more requirements in infrastructure as
well as manpower should be imposed on fertilizer companies. In addition, the
government should promulgate regulations soon so as to control trading of
spurious fertilizer. Sanctions should be strong enough to deter violators.
Moreover, it is important to help farmers distinguish low quality fertilizers.
Slow
approval hinders conversion of commercial homes
There are no signs
of recovery seen in the housing market due to the slow approval process for
conversion of commercial apartments into low-cost ones and division of condos
into smaller units, heard a seminar in HCMC last Friday.
At the seminar
organized by the HCMC Real Estate Association (Horea), most participating
companies expressed disappointment with the slow process of considering their
proposals for splitting up condos and changing commercial apartments into
budget ones.
In addition to the
difficulties caused for companies concerned, homebuyers have felt the pinch
of the slow process as they have been unable to find small apartment units
with affordable prices before they could borrow from the VND30 trillion home
credit package funded by the Government.
Numerous
enterprises in HCMC are seeking permission to split up their apartments,
including Dat Lanh Real Estate Company with Thai An project in District 12,
An Phu Joint Stock Company with An Phu scheme in District 6 and Quoc Cuong
Gia Lai Joint Stock Company with a project in Binh Chanh. Meanwhile, multiple
housing developers in the city have yet to get a nod to change their
commercial housing projects into low-cost ones, Horea said.
The problem is that
even these companies have had no idea about why their applications are not
yet to be approved, Horea noted. These applications should be taken into
consideration as soon as possible because many are struggling with business
difficulties, the association insisted. Speaking at the seminar, Do Thi Loan,
vice chairwoman of Horea, described the Government’s home credit program as a
stalled property development project as money is ready for lending but there
are no borrowers.
Only three
commercial housing projects in the city have been allowed to convert into
low-cost home schemes. They are Thu Thiem Investment Joint Stock Company’s
Thao Dien resettlement project in District 2, Hoang Quan’s CC1 apartment
scheme in Binh Chanh and Hoang Hiep’s apartment scheme in Tan Binh.
HCMC sells
100 budget homes to selected homebuyers
Saigon Thuong Tin
Real Estate Joint Stock Company (Sacomreal) and Tan Binh District’s
authorities signed budget home trading contracts with around 100 customers in
HCMC last Friday.
The homebuyers
selected by local government will be able to own condos of Carillon Apartment
project. Located on
The apartments cost
around VND12 million per square meter with value-added tax included.
Homebuyers will take out preferential loans from VietinBank and BIDV at an
interest rate of 6% per annum.
Carillon Apartment
is one of the low-cost home projects that do not use the State budget. The
condos are expected to be handed over to customers by the end of the year.
Last month, the
city government handed over 100 budget condos of 157/R8 condo building on To
Experts:
Despite
Speaking at a
seminar in the framework of the GreenBiz 2013 Conference and Exhibition that
took place in
Professor Max
Preussner told the seminar that only 10% of wastewater in cities has been
treated, while wastewater in rural areas is mostly untreated.
According to the
Ministry of Health, the nation now has over 13,500 healthcare
facilities including clinics, health prevention centers, training
centers and medicine production plants. Those at the central level discharge
7.3 tons of hazardous solid waste each day and the figure at the district
level is 38.8 tons. Wastewater volume discharges are over 30,000 cubic meters
and 90,700 cubic meters respectively.
Nguyen Thanh Ha,
deputy head of the health environment management department under the Health
Ministry, said that only 69% of hospitals and 32% of healthcare facilities
have invested in a solid waste treatment systems or used treatment services.
Meanwhile, most training centers and health stations have yet to install
standard wastewater systems.
For a clean water
sector,
To realize these
targets,
For the lighting
industry, Ngo Van Huy, general director of Philips Vietnam Company, said that
lighting usually accounts for 19% of energy consumption. However, the ratio
of energy demand for lighting in
Up to 80% of
buildings in
Expy
project investors to be finalized at year-end
The Ministry of
Transport has held a preliminary meeting to discuss the selection of a second
investor for a project to build an expressway connecting
The meeting last
week was attended by 36 major enterprises in the infrastructure construction
sector, mainly from
Le Anh Tuan, head
of the public-private partnership (PPP) project management board under the
Ministry of Transport, told the Daily that the list of investors would be
closed late this year and a bidding would be conducted early next year. The
screening process will be supervised closely to ensure transparency, he
added.
Dau Giay-Phan Thiet
is the first expressway project to be implemented under the PPP format, so
there are many incentives made available for investors.
The one who wins
the bidding will get a grant from the World Bank, and will not have to borrow
from commercial banks as the global development lender will provide another
loan at an interest rate lower than a commercial one.
The Government will
be fully in charge of site clearance of the project.
According to Deputy
Minister of Transport Nguyen Ngoc Dong, the Dau Giay-Phan Thiet superhighway
project will serve as a model for applying the PPP mechanism to other traffic
infrastructure PPP projects in the country.
Bitexco Group as
the first investor of the freeway project will contribute 60% of the
project’s capital. The second investor will be chosen via a competitive
tender and will contribute the rest.
In late July, the
project was introduced in
The 98.7-km Dau
Giay-Phan Thiet Expressway connects HCMC-Long Thanh-Dau Giay Expressway and
National Highway 1A leading to Ba Bau in Binh Thuan Province. The project
needs an estimated US$750 million.
Upon completion,
the project will help shorten travel time from HCMC to the south-central
region and reduce traffic on
VND1.2
trillion lent to Dong Nai bridge project
CC1, the developer
of a project to build a new Dong Nai bridge and Vung Tau intersection in
Speaking at the
signing ceremony, CC1 general director Le Huu Viet Duc said the new Dong Nai
bridge and its two approach roads started construction in June 2008. Just the
bridge was completed in late 2009 while the other components are still under
construction, he added.
Construction of the
flyover and two access roads could be completed next June, according to
Construction Corporation No. 1 (CC1).
Vietnam Development
Bank was originally the lender of the BOT Dong Nai bridge project but the
deal was disrupted due to some reasons. Therefore, CC1 has switched to
VietinBank and SHB to take out VND1.2 trillion loans.
With new funding
secured, CC1 will be able to accelerate implementation work to finish the
bridge and Vung Tau intersection next January and other components in the
middle of next year.
CC1 will collect
toll fees to recover capital for the project in 15 years and two months,
starting from January 2009 to next June at Song Phan station in
The Dong Nai bridge
project consists of Tan Van intersection, new Dong Nai bridge, Vung Tau
intersection, upgrade of old Dong Nai bridge, and access roads.
The project has a
total investment of VND1.65 trillion, with the investor’s capital accounting
for 20%.
A Government report
warns that
The report on
Millennium Development Goals prepared by the Ministry of Investment and
Planning and the United Nations Development Program (UNDP) says that while
foreign loans come with terms of dozens of years, the ratio of
government-issued bonds to government-guaranteed ones of 2-5 years is over
88.7%.
Therefore, while
foreign debt obligations average out at US$1.5-2 billion per year,
obligations for local debts amount to US$4.5-5 billion per year in the next
four years.
The Government’s
debt management and effective use of loans are vital to Vietnam’s sustainable
development in the future.
Citing statistics
in International Monetary Fund and World Bank studies conducted in the year’s
first half, the report indicates that public debt of Vietnam accounted for
around 48.3% of gross domestic product (GDP) late last year and the figure
might be a little bit lower late this year, at 48.2%.
Currently, the
ratio of debt obligations to total budget revenues is around 14-16%.
The report admits
that foreign and public debts have increased rapidly in the past decade,
putting the economy at stake.
When foreign debts
outnumber public debts, Vietnam will become vulnerable to global economic
shocks. Besides, foreign debts include exchange rate risks, and advantages of
preferential loans will be greatly impacted by positive effects resulting
from Vietnam dong’s depreciation.
Vietnam’s three
major creditors are Japan (holding 34.3% of Vietnam’s foreign debts), the
International Development Association of the World Bank (24.9%) and the Asian
Development Bank (15%).
Retailers
still leaving commercial centers
As consumers have
strongly reduced spending amid current economic challenges, more retailers
have decided to leave commercial centers to seek new locations with lower
rents.
Maximark shopping
center on Ba Thang Hai Street in HCMC’s District 10 has many kiosks left
vacant even on the ground floor. On the first floor, some retailers left two
side-by-side fashion stalls two months ago but no customers have taken up the
vacancies since then.
According to a
salesperson on the first floor, most retailers at the shopping center have
met difficulties this year as the number of customers has sharply declined.
Similarly, all
kiosks of Pico Plaza on Cong Hoa Street in Tan Binh District were rented
during the first days but trading at the center is quiet now. Many retailers
have abandoned their stalls despite the shopping center only being in
operation for around eight months.
The owner of a fashion
stall at Pico Plaza said that few customers visit the center on weekdays. The
plaza becomes busier at weekends but customers are mostly window-shoppers.
Meanwhile, the
shopping and kids entertainment areas at Thien Son Plaza in District 7 have
virtually stopped operations. According to a security guard of the building,
many enterprises have closed down in succession since the start of the year.
Thien Son Plaza
currently includes company offices, bank transaction points and classrooms of
English training centers, while its retail business has perished.
Parkson Paragon in
District 7 still has a number of retailers but the shopping center is another
who receives very few customers on a daily basis.
Parkson Flemington
in District 11 has a number of kiosks left vacant. However, the media
department of Parkson Vietnam said that the center is rearranging some areas
and that new retailers will arrive next month.
Marc Townsend,
managing director of CBRE Vietnam, said high rents and low customer numbers
are the biggest challenges of the retail industry at present.
Phan Van Ty, head
of retail units of Savills Vietnam, said that many investors and building
management units have reduced rents to support retailers.
For instance, the
investor of Crescent Mall in District 7 in the first half of this year cut
rents by 5% against 2012’s July-December to assist retailers. Consumer demand
has declined strongly since last year, especially in the middle- and
high-class fashion sector, Ty said.
According to
Savills Vietnam, total retail supply in HCMC stood at around 776,000 square
meters in the second quarter of the year, down 2.4% against the previous
quarter, as many shopping centers closed or changed business functions.
Vietnam’s
C.T Group eyes Myanmar IP
Ho Chi Minh City’s
CT Group is planning to build an industrial zone in Myanmar to house
Vietnamese investors.
The group has
submitted plans for the Vietnam-Myanmar Industrial Zone to Myanmar Vice
President Nyan Tun. CT has not yet released details to the public.
However, the group
did say that the industrial zone would serve Vietnamese companies that want
to invest in Myanmar, but did not have a home for their production
facilities.
Myanmar is being
eyed as a potential new emerging market by enterprises all over the world.
During their
meeting with Tun, CT donated bed sets, blankets and pillows valued at $30,000
to support low-income people in areas affected by natural disasters.
CT Group is
actively seeking business in Myanmar and it is also expanding into Indonesia.
According to the
Myanmar Investment Commission, by the end of August 2013, the country saw a
total of more than $43 billion in foreign investments. China is the biggest
investing country and Vietnam is in the top ten list. The top exporting country
to Myanmar is China, followed by Thailand, Singapore, South Korea, Malaysia,
India, Germany and Vietnam.
The Myanmar
Investment Commission reported that by the end of August the country
registered more than $43 billion in foreign investment. China topped the
list, followed by Thailand and Singapore. Vietnam was the eighth.
VIB hosts
“Overview on macroeconomics and financial risk solutions” workshops
Vietnam
International Bank (VIB) is hosting “Overview on macroeconomics and financial
risk solutions” workshops in Hanoi on September 24, in Ho Chi Minh City on
September 25 and in the Mekong Delta’s Can Tho city on September 28.
The workshops are
aimed to provide enterprises with the most updated information on Vietnam’s
economic situation, treasury/forex, analyses and forecasts from financial
experts and economists through different topics.
With clear and
specific counseling cases, participating enterprises will not only have a
good overview of the macro-economic situation since the start of 2013 but also
be consulted and provided with financial solutions in forex in the coming
period, especially in late 2013 when import-export activities are rather
busy.
“In the context of
various difficulties and challenges facing the economy, enterprises are
actually in need of useful advisory information and financial solutions for
their strategies,” Le Quang Trung, deputy CEO and head of Treasury at VIB
said. “Adhering to the bank’s philosophy to work closely with enterprises,
especially importers and exporters, VIB always strives to create the best
conditions to help our customers get updated information on the global and
local financial markets. In addition, VIB also provides advisory services and
forecasts on which enterprises can base to better manager risks in forex and
maximize profits.”
Previously, VIB
hosted similar workshops for enterprises, namely workshops on macroeconomics
and forex market in the northern Thai Binh and southern Dong Nai provinces.
FPT
earnings well ahead on year
In the first eight
months of this year, FPT reported pre-tax profits of $76.7 million.
Revenues for the
same period amounted to $824.4 million, a 13 per cent increase against the
same period last year. This puts the company well on track to achieve their
annual earnings forecast.
After-tax profits
totalled $63.3 million, up 5 per cent against the same period last year and
earnings per share hit $0.17, up 2 per cent.
The company’s
primary revenue source was technology and telecommunications with 76 per cent
growth. Software and system integration and IT services accounted for 21 and
23 per cent, respectively. Internet and digital content grew by 11 per cent.
Diversification
in downturn
Foreign
consultancies are changing their portfolios and gradually moving into other
fields in response to the deteriorating real estate market.
Troy Griffiths,
deputy managing director of Savills Vietnam, told VIR that the company’s
traditional business lines, leasing and project sales, had come under duress
and led to layoffs in under-performing areas of the business.
“However Savills
total headcount has increased to 940 as we have added new business lines and
expanded our property management services offering,” he explained.
“We are fortunate
that our recurring income streams of property management and advisory
services have delivered continuous cash flows, albeit at very low margins.
Savills manages 70 buildings throughout Vietnam that delivers steady cash
flow over challenging economic periods,” he added.
Griffiths said
Savills would continue to diversify their business to cater to broader client
needs.
Following its
success and achievement in sales of high-end residential products and holiday
home, Savills Vietnam has set out a new business strategy to diversify the
stocks and to be more adaptive to market demand. Specifically, in late June,
Savills Vietnam Real Estate Trading Floor launched this extended new business
service for sales and marketing of affordable housing products.
The company has
established a strategic partner with one of the local real estate company to
exclusively distribute the Dream Home apartments developed by Dream Home Ltd.
in Go Vap district, Ho Chi Minh City.
“Importantly the
affordable housing sector represents over 70 per cent of the primary market;
as such it would simply be bad business to ignore this potential,” said
Griffiths.
Savills has
recently expanded its consulting capacity with products such as Geographic
Information Systems and its agency platform in Indochina and Myanmar.
Along the same
line, CBRE Vietnam recently held a conference that focused on identifying
more lucrative potential projects in Myanmar.
Marc Townsend,
managing director of CBRE Vietnam, said the company had been affected by the
real estate market’s downturn over the last few years, forcing its to reduce
the working space of its Hanoi office by half.
The company’s
property transaction centre in Hanoi has been narrowed and residential sales
team has been most affected due to the housing market downturn.
“CBRE is serving
fewer customers than before, but that has given us the opportunity to focus
more on quality service. While there are fewer foreign investors, there are
increasing numbers of local companies who are potential clients in the fields
of banking, retail, and property development,” he added.
CBRE’s staff
working in project management has increased from 2 last year to 12 at
current.
“We are currently
helping a large foreign company in Hanoi with more than 2,000 staff move its
office. We supported them in leasing the space and fitting it out, as well as
provided logistics for the move, on time and on budget,” Townsend said.
CBRE has expanded
property management, with the floor area under management now doubling from
last year’s figure and expected to double again by the end of this year.
Chris Brown,
general manager of Cushman & Wakefield Vietnam said the slumping property
market was affecting firms’ operations in several areas.
According to Brown,
the company’s most heavily affected team was residential sales which spiked
in 2007-2008 but had since been heavily impacted by falling demand
nationwide. The company continued to be cautious in this area and was
limiting the growth of the team until future conditions make expansion
feasible.
“Cushman &
Wakefield Vietnam has always been careful to avoid overly rapid expansion
preferring to pace our growth strategically. We have seen softening in areas
such as residential sales and leasing, but these business lines are
inherently cyclic and we expect improvement in the next 12 months,” he said.
“We are using the
slowdown as an opportunity to relocate to Vincom Center B this year, and
expanding our workspace by more than 100 square metres, with room for future
expansion,” he added.
“There are areas of
our business which are growing and we now have 10 employees working in office
leasing in Ho Chi Minh City. We also have developed a fully dedicated
national retail services platform and investment agency services,” he said.
Cushman &
Wakefield has this year concluded some of the larger transactions in Ho Chi
Minh City such as Abbott Laboratories’ lease renewal at Me Linh Point Tower
(2,600sqm), Nestle’s relocation to Empress Tower (3,200sqm), Microsoft’s
relocation to President Place (744sqm), and JWT relocation to President Place
(510sqm). In Hanoi, some of its larger transaction include the IBM’s renewal
at Pacific Place (1,500sqm) and the Prudential’s relocation to Keangnam
(1,700sqm).
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Năm, 26 tháng 9, 2013
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