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BUSINESS IN BRIEF 18/1
FOL
to rise before Tet
The
draft on expanding foreign ownership limit (FOL) in enterprises may be
adopted before the Lunar New Year holiday, or Tet, according to a senior
official of the State Securities Commission (SSC).
In the
latest draft replacing Decision 55 stipulating foreign participation in
listed enterprises, the rule of industry classification has been removed.
State-owned enterprises where the State needs to hold a majority stake and
special firms such as banks will follow private rules, the official told the
Daily.
For
remaining enterprises, the draft stipulates that foreign room will be
increased to 60% with voting rights.
The
draft has received support from the Government and SSC expects to release it
before Tet.
After
the draft is approved, listed enterprises will decide FOL for themselves.
They will register the figures to SSC without the need to seek approval from
the Ministry of Finance or the Government. Therefore, room expansion actually
will be faster.
In
addition, enterprises can decide on the foreign room issue during their
annual general meetings or field suggestions of shareholders in writing. As
some enterprises cannot organize shareholder meetings immediately, the latter
way might be a wiser solution for them.
Meanwhile,
some new foreign investment funds have been strongly disbursed into the
market since earlier this month.
Dinh
Quang Hoan, deputy general director of Viet Capital Securities Company, said
that some foreign funds have opened accounts at the brokerage to acquire
blue-chips, especially those in the oil and gas sector.
According
to the Hochiminh Stock Exchange (HOSE), foreigners net bought VND422 billion
in the first eight trading sessions of 2014, a record high over the past few
years. This year is expected as a positive year for foreign indirect
investment capital attraction, said a HOSE representative.
The
general director of a large investment fund said that the stable exchange
rate is a catalyst for indirect capital attraction. “The exchange rate had
been stabilized in 2012 and 2013. If the forex rate continues to be stable
this year, confidence of foreign investors will be strengthened,” he said.
The
central bank’s governor Nguyen Van Binh recently told the Daily that the
central bank has increased foreign currency purchase given strong supplies.
Last year, overseas remittance into the country for the first time hit US$11
billion.
The
central bank bought around US$20 billion in 2012 and net bought around US$7
billion last year. This year, the agency expects to increase purchases to
improve the country’s foreign reserves.
Banks
brace for high Tet cash demand
As
demand for cash withdrawals from automated teller machines (ATMs) always
surges in the lead up to the traditional Lunar New Year holiday, or Tet,
banks have been taking measures to cope with forthcoming ATM overloads.
The
head of an ATM service department of Vietcombank’s branch said the bank has
around 5.5 million ATM cardholders nationwide. In previous years, cash
withdrawals doubled around 10 days ahead of Tet and surged by two to three
times thereafter.
Workers
at industrial parks (IPs) and exporting processing zones (EPZs) always have
strong demand for cash before they head home for family reunion. Therefore,
Vietcombank this year has moved some ATMs from elsewhere to areas near IPs
and EPZs, the bank said.
However,
the bank can move a maximum of 10 ATMs to areas around IPs and EPZs, so
overloads cannot be avoided shortly before Tet.
Vietcombank
has written to its corporate customers and management of IPs and EPZs to seek
cooperation to reduce pressure from massive cash withdrawals just ahead of
Tet. The bank has suggested solutions such as scheduling wage and bonus
payments in a way that prevents simultaneous withdrawals and arranging
rotating breaks during the day to give workers time to get their cash at
ATMs.
Chu
Hong Minh, director of the ATM center of DongABank, said cash needs for wage
payments and shopping between December and January usually surge three to
four times compared to normal days.
DongABank
plans to launch mobile ATMs to serve workers at IPs and EPZs. The bank will
also double the number of technical staff to deal with technical problems
with ATMs during Tet.
DongABank
now has over 1,200 ATMs nationwide. Therefore, a customer who cannot withdraw
cash at an ATM can find nearby machines following instructions posted at the
ATM booth.
DongABank
on Tuesday introduced new-generation ATMs that allow customers to perform
various banking transactions 24 hours a day instead of going to a bank
office. The bank plans to install 250 new ATMs in the country.
Unskilled
labor market dreary ahead of Tet
ue to
economic difficulties, the local market has seen a decline in unskilled labor
demand these days when the Tet holiday is nearing while this is a good time
for unskilled workers to look for seasonal jobs in previous years
Demand
for workers running errands at wholesale markets in the final days before Tet
is not as strong as it was in previous years.
Nguyen
Van Tiep, an unskilled 55 year-old laborer specializing in opening cartons
and cleaning fruits at Thu Duc farm produce wholesale market said: “This
year’s commodity volume arriving at the market now is not as huge as last
year. All traders tend to watch the situation until the 20th day of the
twelfth lunar month to consider purchasing more commodities. Therefore, labor
demand at the market does not increase and traders this year have only used
daily workers instead of hiring more outside laborers.”
At
Tet, many families often think of re-painting and repairing their homes.
However, Ninh Van Duc, a construction contractor in Binh Thanh District,
informed that this year’s home repair demand was not so high, which was only
equivalent to 70% of that in the same period last year.
Vo Kim
Long, a building worker in Binh Thanh, said he had worked for many
construction sites before the previous Tet but he had no jobs to do for Tet
this year.
Similarly,
the local demand for domestic helpers for Tet was really huge in other years
but Tran Thanh Duc, director of Hong Duc Family Service Company in District
7, said domestic helper demand for this year’s Tet was not high.
“As of
now, our firm has only received about four to five orders registering for
helpers during Tet. The expense for hiring one helper at the year’s end
fluctuates between VND30,000 to VND50,000 an hour,” he aded.
Unskilled
workers with unstable jobs always pin hopes on the days before Tet to get
more income but given the current dreary labor demand, it would be not easy
for them to find a job.
Keyword
advertising grows well
Revenues
of keyword advertising still achieved strong growth last year, despite
multiple difficulties in the economy, industry sources said.
Google,
the search engine accounting for up to 90% of the advertising revenues in
Nguyen
Khanh Trinh, director of CleverAds Co., said that CleverAds obtained revenues
of US$6 million last year, up 160% year-on-year, with around 70-80% of the
firm’s revenues sourced from advertising deals with Google.
According
to Trinh, though CleverAds saw a 160% growth rate last year, such growth was
lower than in previous years.
Google
has two sources of advertising revenues in Vietnam, with around 80% of the
revenues obtained from keyword advertising of enterprises on the Google
website while the rest from advertising partners.
Keyword
advertising growth in
According
to a source, the social network Facebook has had the first advertising agent
in
Meanwhile,
the free text and call services supplier Viber is planning to seek an advertising
partner in
Banks
in HCMC will keep on handing out preferential loans to enterprises and
family-run businesses with a total value estimated at VND25-30 trillion this
year, doubling that of 2013.
Nguyen
Hoang Minh, deputy director of the central bank’s HCMC branch, said that the
agency and the HCMC Department of Industry and Trade will cooperate to
further boost the capital connection programs between enterprises and lenders
across the city like what were done successfully last year.
In
2013, local banks disbursed around VND13.5 trillion to enterprises with
lending rates falling following deposit rate ceiling reductions by the
central bank. In the last quarter, preferential lending rates were only
8-8.5% per annum for short-term loans and under 10% for medium to long-term
credits.
This
year, the loans will be extended to all enterprises, not just those in
priority sectors like before. The central bank’s HCMC branch will tell banks
to focus on businesses in the supporting and high-tech industries.
Credit
conditions are still subject to banks. However, banks are encouraged to give
loans secured by accounts receivable instead of assets as collateral only.
This
year, the city aims at credit growth rate of 12-14% against late 2013. This
is a high target as local banks’ total outstanding loans in 2013 grew less
than 9% compared to late 2012, Minh said.
HCMC
has applied many solutions to speed up credit growth rate this year,
including the VND30-trillion home loan package, bank-business connection
programs and lending program for price stabilization sales.
SeABank,
PVI Holdings in comprehensive cooperation
Southeast
Asia Commercial Bank (SeABank) and PVI Holdings Company inked a comprehensive
cooperation agreement last Friday to exploit advantages of both sides and
better customer services.
Under
the agreement, SeABank will become the main service bank for PVI Holdings,
its staff, member units and customers for various banking services such as
account, credit, international payment and currency trading. Meanwhile, PVI
Holdings will provide suitable insurance products for SeABank and its staff
and customers.
Both
sides will also consider joining hands in some investment projects that they
have advantages.
On
this occasion, customers of PVI Holdings will receive preferential policies
when using SeABank’s services.
S.Korea
opens farm produce center in city
The
Korea Trade-Investment Promotion Agency (Kotra) and Kyong Sang Buk Province
of South Korea last week opened a farm produce showroom in HCMC.
According
to Woo Wan Kook, head of marketing of the province’s
Apples,
apple juice, red pepper paste, garlic and red pepper powder are among the
produce on display at the new facility.
“In
addition to supplying products for the South Korean community in
However,
this farm produce center is just the beginning as Uiseong County will seek
ways to cooperate with a Vietnamese locality to open a farmer training center
and introduce farms in Uiseong to farmers, said Woo.
Uiseong
has favorable farming conditions but faces a labor shortfall in the sector.
The county expects to cope with the shortage by employing Vietnamese farmers
in the coming time, according to Woo.
Aeon
plans bigger presence in Vietnam
Positive
feedback from local shoppers is an encouragement for Aeon Company Limited to
quicken the pace of shopping mall development to meet the demand in
Speaking
at a news briefing last Saturday, Yasuo Nishitohge, general director of Aeon
Vietnam, said the first ten days of soft opening saw around 30,000 people on
weekdays and 70,000 on weekends thronging Aeon Mall Tan Phu Celadon in the
outlying district of Tan Phu in HCMC, one of its first properties in
The
number of shoppers is expected to increase further in the coming time as the
retail giant on Saturday cut the ribbon to fully put into operation the
US$100 million shopping mall after some 18 months of construction.
Located
in the 82-hectare residential complex
After
the grand opening of Aeon Mall Tan Phu Celadon, the company will continue its
business expansion plan with two other projects in the pipeline. They are
Aeon Binh Duong Canary in the southern
Nishitohge
said Aeon will initially focus its business expansion on the two main cities,
Motoya
Okada, group chief executive officer, president of Aeon Company Limited, said
there will be challenges ahead but the company will try to achieve its
business target in
“Each
retailer has its own strategy and anywhere we come we closely work with local
partners, finding qualified ones, with whom we expand our business strategy,”
Okada said, adding that besides building properties, training local people is
one of the ways for Aeon to gain success in global markets.
In
fact, Aeon began its
Talking
about the development plan in the Asian region, Nagahisa Oyama, vice
president, chief executive officer of ASEAN Business for Aeon Company
Limited, said
Oyama
said the company came to explore business opportunities in
In its
mid-term plan from 2011-2013, Aeon set a business strategy named “
Asked
whether Aeon was planning to bring Vietnamese products to its retail stores
outside the country, Oyama said some Vietnamese products worth some US$60
million have been put on the shelves of stores in
Mai
Linh revenue continues falling
Mai
Linh Group told a reviewing conference on the group’s business performance in
2013 on Monday that the total net revenues of its subsidiaries were estimated
at some VND4 trillion in 2013, slipping 5% from the 2012 figure.
However,
the net revenues of VND4 trillion, as shown in the consolidated financial
report of Mai Linh, were still 9.6% higher than the year’s target.
Mai
Linh reported VND27.8 billion in its consolidated profits, meeting 41.6% of
the year’s plan. Last year also saw a sharp fall in the number of taxi cabs
of Mai Linh, as the company liquidated up to 1,300 vehicles while it only
purchased more than 1,000 units.
Mai
Linh had run a combined 10,900 vehicles as of December 31, 2013 compared to
over 12,100 units as recorded at the end of 2012. The number of vehicles of
Mai Linh only made up 33% of the city’s total vehicles, with its transport
volume accounting for 25% only, showing a significant decrease compared to
previous years, the city’s Department of Transport reports.
Ho
Huy, chairman of Mai Linh, informed that his group’s losses had been reduced
considerably thanks to the whole system restructuring last year.
As per
the business plan for 2014, Mai Linh will buy about 1,400 vehicles and
liquidate 560 units in the system, with those vehicles in operation prior to
2007 set to be replaced. Mai Linh has also set a target of obtaining an
annual average profit of VND20 million per unit, with a combined profit of
VND171.5 billion set for the whole group.
After
the restructuring process, the firm’s workforce has been reduced strongly,
with its staff members recorded at close to 25,000 persons as of December 31,
2013 compared to 28,000 in end-2012.
Mai
Linh fell into serious business distress at the end of 2012, thus selling out
real estate projects, a rest-stop system and many old vehicles to service
bank loans.
Over
the past time, many customers have kept complaining about the poor service
quality of Mai Linh, from the attitude of drivers to the old vehicles
resulting from poor maintenance.
At the
meeting, Mai Linh admitted that owing to business difficulties, it sometimes
had neglected management, especially in HCMC.
Upon
complaints from customers, Mai Linh has organized training courses on
customer service skills for drivers, which have contributed to improving its
service quality, the group said.
Doosan
Vina ships heat recovery generator to Mexico
Doosan
Vina has just shipped a heat recovery steam generator (HRSG) weighing up to
1,418 tons to the Intergent Thermal Power Plant in
Production
for the earth-friendly 200MW Intergent HRSG project began last July and after
six months of fabrication and assembly the high tech equipment was loaded and
shipped from Doosan Vina’s purpose-built port facility.
The
equipment was designed, engineered and fabricated at the company’s
110-hectare complex in Dung Quat Economic Zone in the central
This
equipment will help the Intergent power plant capture and recover wasted
energy. A typical HRSG installation can increase the efficiency of a power
plant by up to 30%, which saves money, reduces emissions and saves the
earth’s resources, Doosan Vina said in a statement.
Since
commencing operations in 2009, the HRSG facility at Doosan Vina has completed
and shipped ten “Made-in-Vietnam” HRSG units to customers in
Honda
Vietnam increases scooter exports
Honda
Vietnam said that it will speed up scooter exports, including new PCX
scooters launched onto the local market on Monday, to improve sales as
domestic consumption is expected to stay low in the near term.
PCX
scooters were first produced and exported by Honda Thailand. However,
Masayuki Igarashi, general director of Honda Vietnam, said that PCX is now a
global scooter version that can be produced and exported all over the world.
The
enterprise has plans to export 30,000 PCX scooters annually. This is also the
first time Honda Vietnam has exported PCX scooters after shipping other
products such as SH, SH Mode and Lead to developed markets such as
Igarashi
said that Honda Vietnam will export PCX scooters to 14 markets in Asia,
Africa and
The
local motorbike market is forecast to see more difficulties, so Honda Vietnam
targets to export 100,000 bikes in 2014 compared to last year’s export volume
of 40,000 units. The enterprise will also increase exports of SH, SH Mode and
Lead scooters.
With
the new PCX product, Honda Vietnam expects to sell around 20,000 units per
year. Retail prices are suggested at nearly VND52 million each scooter for
the standard version and around VND54.5 million for the high-class version,
VAT included.
Speaking
at the PCX introduction ceremony on Monday, Igarashi said that motorbike
sales in the country reached 2.79 million units last year, down around 10%
against 2012. This was the second consecutive year that bike consumption in
Local
producers launched new products and promotion programs in 2013 but
consumption still decreased amid economic challenges. Honda Vietnam sold
around 1.87 million bikes. In 2012, the enterprise sold around 1.97 million
bikes, a 4% year-on-year drop, Igarashi said.
Other
motorbike producers also saw a sales decline. Last year, Honda Vietnam held around
67.1% of the local bike market.
Honda
Vietnam projects to launch a third factory into operation this year. With its
two plants in
According
to manufacturers,
Work
starts on VND4.1-trillion highway upgrade
The
Ministry of Transport on Sunday started construction of a project to upgrade
a section of National Highway 20 going through
The
road extends to
The
section when complete will have a width of 12 meters including four lanes allowing
for vehicular speed of 60 kilometers per hour.
Having
a total investment of more than VND4.1 trillion, the project is divided into
two components, one developed under the build-operate-transfer (BOT) format
worth over VND1.3 trillion, and the other under the BT form worth more than
VND2.7 trillion. The scheme is set for completion in 2015.
To
recover the investment, the BOT investor will start toll collection from
early 2016, which will last for around 21 years and 10 months.
Meanwhile,
the BT investment will be advanced by the investor, with the Government set
to repay the whole principal and interest sums from 2018 to 2022.
According
to Deputy Minister of Transport Nguyen Ngoc Dong, as there are almost no
waterways in the Central Highlands region while the railway system there is
not yet available, roads will play an important role in transportation in the
region.
National
Highway 20 is currently the backbone route between HCMC and
Leaders
of
At
present, the construction on National Highway 20 is being implemented from
Dau Giay T-conjunction in Dong Nai to Provincial Road 725 in Lam Dong’s Bao
Loc with a total length of some 123 kilometers. The upgrade is conducted
based on the BT format at a cost of roughly VND4.5 trillion.
The
scheme’s completion was initially scheduled for late this year but it now is
rescheduled for next year owing to capital shortage and slow site-clearance.
Besides serving local travel, the route is also used for transporting alumina
from Lam Dong to Go Dau Port in Dong Nai.
Fertilizer
import surges in 2013
Last
year’s fertilizer import jumped to 4.53 million tons compared to the initial
estimate of 2.5 million tons as local production decreased in certain periods
coupled with the low price of urea fertilizer in the global market.
The
Ministry of Agriculture and Rural Development said in a report that the
country spent US$1.65 billion importing 4.53 million tons last year, rising
14.3% in volume but down 2.4% in value compared to 2012.
The
country imported 758,000 tons of urea fertilizer worth US$252 million, rising
by over 50% and 20% in volume and value respectively. Meanwhile, 1.09 million
tons of SA fertilizer was imported with a value of US$186 million, down 6.5%
in volume and nearly 31% in value.
Fertilizer
imported from
Early
last year, the ministry forecast that Vietnam would import nearly 2.5 million
tons of fertilizer, with 850,000 tons of SA, 570,000 tons of DAP, 950,000
tons of kali, 100,000 tons of NPK but no import of urea as the domestic urea
supply was sufficient.
However,
the urea volume imported last year increased by over 50% over that in 2012.
Explaining
the high import volume of urea, Nguyen Hac Thuy, chairman of the Vietnam
Fertilizer Association, pointed to the shortfall in certain periods.
Though
Besides,
the price fluctuation was also a reason for rising import of urea. The global
urea price in mid-2013 was around US$100 per ton lower than that in the
year’s beginning, prompting traders to import in bulk to enjoy the price
difference.
According
to Thuy, however,
2013
a ripe year for garment sector
The
textile and garment sector outperformed in 2013 with total export value more
than $1 billion above the annual target.
The
sector raked in more than $20 billion, rising 18 per cent on-year..
Of
this, textile, garment, fibre and yarn exports brought in $19.7 billion, up
18 per cent; materials and accessories reached $700 million.
These
buoyant figures have put the textile and garment sector among the country’s
highest export earners.
The
sector also saw sharp rises in key export markets including the
An
example of
Last
year, textile and garment exports to the
Deputy
chairman of the Vietnam Textile and Apparel Association Le Tien Truong said
the achievements showed the sector had weathered the storm of economic
difficulties by taking proper steps to boost competitiveness, diversify
markets and deepen its reach into key markets.
“Solid
forecasting on purchasing capacity and consumer trends this year will play a
crucial role in organising production, satisfying customers, and supplying
products in a timely manner to increase the appeal of made-in-Vietnam
textiles and garments to global customers,” said Truong.
Truong
said the sector’s exceptional growth in 2013 was greatly supported by firms’
expansion plans to boost production amid difficult market conditions.
In one
example, last year Hue Textile Garment Joint Stock Company (Huegatex) posted
20 per cent revenue growth against 2012, reaching VND1.4 trillion ($66.6
million) and export values of $66 million, up 10 per cent on-year. It
achieved profits of VND35 billion ($1.6 million)
According
to deputy general director Ho Van Dien, despite the unstable market and
rising input costs, Huegatex invested VND50 billion ($2.3 million) into
procuring new equipment to diversify their product lines and increase
production to tap opportunities of the Trans-Pacific Partnership, due to be
signed this year.
Another
firm, Hanoi Textile Garment Joint Stock Company inaugurated its Dong Van
Fibre Plant, based in northern Ha Nam, with a total investment of VND420
billion ($20 million). The plant boasts 30,000 spindles.
Launched
in April, by the end of last year the plant had exported 100 tonnes of fibre,
making a remarkable contribution to the corporation’s total revenue of VND1.9
trillion ($90.4 million).
Ford
Ford
The
exceptional performance made Ford in top 3 and being one of the
fastest-growing automotive brands in the country last year and helped lead
anoverall recovery of
Ford
finished the strong year on a high-note year with December retail sales
rising 39 per cent to 1,008 units – its best monthly performance since
December 2011.
“We
enjoyed sustained momentum throughout 2013 as we expanded our
Exceptional
demand for theFord Transit contributed to its best-ever monthly and full-year
performances, andended the year as the leader of
The
rugged and versatile all-new Ford Ranger was also number one overall in its
segment in
“We’re
proud of the segment leadership of both the Transit and all-new Ranger, and
their success in 2013 shows how we’re connecting with and serving a wide
range of new customers as wecontinue to build the Ford brand in Vietnam,”
said Arias.
The
technology-packed all-new Focus enjoyed its best month since its launch with
sales of 113 units, as Vietnamese consumers discovered its advanced,
segment-first technologies
The
launch of the new Fiesta featuring Ford’s 1.0-litre EcoBoost engine – named
“International Engine of the Year” for two consecutive years in 2012 and 2013
– helped to boost the appeal of this segment leading small car.The popular
Fiesta delivered full-year retail sales of 847 units.
“Our
aim with the new Fiesta was to take a popular car that was already a segment
leader in fuel efficiency, performance and personality, and make it even
better,” said Arias. “The new Fiesta continues to push the boundaries,
sealing its credentials as the small car that truly stands out from the
competition.”
Ford’s
sales success in
Ford
will further expand its SUV lineup in 2014 with the launch of the all-new
Ford EcoSport urban SUV.
“With
the launch of the all-new EcoSport, we’ll be able to offer Vietnamese
consumers an even wider lineup of SUVs, further expanding our showroom, and
continuing our successful product-led transformation,”explained Arias.
Ford
also continued to expand its nationwide dealer network in 2013, adding two
new dealerships bringing the total number of dealer locations in
The company
also continued to further enhance its customer service experience last year
with the launch of Quality Care for Body Shop, Quick Service and Schedule
Maintenance Package initiatives.
“We’re
absolutely committed to growing our business and welcoming more new-to-Ford
customers to our dealers across
SBV
determined to enact bad debt decree
The
State Bank of
Industry
experts say the circular would unveil the true level of banks’ bad debts and
as such the central bank should be prepared for the worst.
Senior
economist Nguyen Minh Phong said the SBV’s determination to enforce the
circular is positive as it reflects
“Banks
are concealing their bad debts like camels with their heads in the sand.
Circular 02 will uncover the truth behind
“These
plans will help avert shocks and any possible collapse of the banking
system,” Phong proposed.
Agreeing
with Phong, many experts are arguing that banks must be completely
transparent regarding bad debts. The central bank has welcomed banks to
divulge all information on their financial health prior to the circular
taking effect and this is assumed to be towards its plans to avoid risks and
tackle problems.
In
regard to how banks feel about the upcoming circular, state giant VietinBank
chairman Pham Huy Hung agreed that the circular was crucial to improving
banks’ risk management to an international level.
“The
impact of Circular 02 on us will be small as we have continuously bolstered
our operational efficiency and risk management. We hold bad debts of a mere
0.9 per cent,” Hung said.
A
source from Mekong Bank also said Circular 02 won’t be a problem for banks
that are on a sustainable development path.
The
SBV is expected to enact guiding documents on the implementation of Circular
02 within this month.
According
to the central bank’s Chief Inspector Dang Van Thao, the circular will give
the SBV the tools to curb what signs show to be fast rising bad debts.
One
measure would be the division of bad debts into three groups.
The
first would consist of customers who have reached bankruptcy or dissolution
and for which there is no collateral. Banks would have to use their own
resources to deal with these.
The
second group is customers facing difficulties and the SBV will facilitate
debt rescheduling and/or a lower interest rate.
The
third group consists of dissolved firms with collateral, and banks will be
allowed to form auctioneering councils to sell distressed assets.
Mid-price
apartments overthrow low-price
Apartments
for sale in Hanoi for the last quarter of 2013 saw the consistently high
sales of low priced products ($1,000 per square metre or less) overtaken by
those of mid-priced products ($1,000-$1,500 per square metre).
According
to CBRE Vietnam, for the first time in two years low-priced products lost the
dominant share.
Figures
from the consultancy showed that more than 10 projects at the mid-price level
saw increasing liquidity including Golden Westlake,
Richard
Leech, executive director of CBRE Vietnam, said that this new trend may be
considered developers’ response to market’s changing appetite to mid-priced
products. “Unlike previous quarters in which transactions mostly occurred in
the low price range, the last quarter of 2013 saw more transactions in the
mid-price level. This is most likely driven by buyers’ increasing confidence,
which also led to a 50 per cent quarter-on-quarter increase in total
transaction volume,” Leech said.
Richard
Leech, executive director of CBRE Vietnam said the changed trend may be a
positive sign that developers anticipated the rise in demand for mid-price
products. “The mid-price level made considerable gains in the last quarter
against the rest of the year with many more transactions. This is likely
being driven by increasing consumer confidence which pushed a 50 per cent
transaction volume increase,” Leech explained.
However,
also in the final quarter of 2013,
Re-launches
were much more active though, as developers focused on clearing old stock
rather than releasing new products.
Following
a record third quarter, the fourth saw the nearly as strong completion of
7,500 total units.
CapitaLand
is also selling apartments in its Mulberry Lane project in Ha Dong district
at prices of VND25 to 27 million ($1,190 to $1,285) per square metre. Another
project in Cau Giay is offering units for just a fraction more.
Other
projects along the same price lines are the Discovery Complex and Thang Long
Number One.
The
prices of secondary products however are still in a downward spiral, noted
CBRE. Price drops in the fourth quarter were not as low as the first and
second, but were bigger than quarter 3.
It is
a fact that prices will not recover quickly as 2014 is expected to see
another parade of openings that will increase competition and cast an even
darker shadow over second hand units. Buyers are trending toward investing in
just finished or very nearly finished properties to avoid handover quality
and lateness issues. Quality projects are sure to see active sales in the
coming time, but they shouldn’t expect demand to stimulate anything more than
a modest price rise.
New
plan proposed for Hoa Lac-Hoa Binh route
A
fresh investment plan has been proposed for the construction of a road system
connecting
A
proposal from the Ministry of Transport (MoT) just submitted to the prime
minister outlines a two-lane Hoa Lac-Hoa Binh route built over 30km starting
from an ethnic culture and tourism village in Hanoi’s Son Tay town and
linking up to National Highway 6 next to Hoa Binh city.
The
proposal also includes expanding Highway 6’s 33km Xuan Mai-Hoa Binh section
by two lanes.
Consulting
unit estimates show the cost for the route, which would be later upgraded to
a highway, at around VND2.138 trillion ($102 million), of which VND566
billion ($27 million) would go into site clearance.
Improving
the 33km of Highway 6, including sections through crowded residential
quarters, was estimated at around VND341 billion ($16.2 million).
“We
are seeking the prime minister’s approval to combine Highway 6’s 33km upgrade
with the construction of the Hoa Lac-Hoa Binh route,” said Deputy Minister of
Transport Nguyen Hong Truong.
This
would put total project costs at around VND3.129 trillion ($149 million).
The
project is considered urgent because Highway 6 is the only road linking the
northwest region to Hanoi and is quickly deteriorating.
Estimates
show that to meet increasing transport demand by 2017, the highway needs to
be upgraded to four lanes. It faces a particularly great challenge as the
expansion will infringe on the properties of numerous residents.
Since
budget capital is not readily available for the project and it is hard to
access ODA, the MoT is proposing the project be conducted under the
build-operate-transfer (BOT model) with all funding provided by the investor.
The
investor will be granted the right to place two toll stations on Highway 6
and collections could begin immediately after the upgrade slated for 2015.
One
station would be set up on the Hoa Lac-Hoa Binh route with collections
starting when it opens hopefully in 2017.
Considering
the toll price, the MoT proposed the government apply a fee similar to that
of National Highway 1’s BOT projects, where the fare exceeded the MoT’s cap
by 3.5 times.
With
these conditions, investment could be recouped within 29 years.
Under
the new plan, the road system connecting Hanoi and Hoa Binh would have four
lanes, similar in scope to the Hoa Lac-Hoa Binh highway project that
developer Hanoi Import Export JSC (Geleximco) withdrew from in August 2013.
After
the project’s investment spiked to VND18 trillion ($857 million), Geleximco
sent a document to the prime minister asking they be allowed to stop their
involvement as they would not be able to recoup their investment.
According
to a MoT source, other local investors have since showed interest in the
project, even Geleximco has renewed interest after changes to the project’s
plan and model.
“This
is actually a solution for both the MoT and investors when it comes to the
successful upgrade of this important road system,” said a transport expert.
Budget
figures consistent, say Finance Minister
Finance
Minister Dinh Tien Dung on Monday said that the ministry has always given
clear figures for State budget collection and expenditure in 2013 after
consistencies have been found in collection results announced over the past
time.
Speaking
at the press briefing in Hanoi City on Monday, Dung said last year’s budget
collection were 0.4% higher instead of 1% lower than estimated as announced
at the summarizing conference a week ago.
The
result was a surprise as budget collection only met 43% of estimation as of
June, over 66% as of September and 86% as of November.
Explaining
the difference within just around a month, Dung said the National Assembly
(NA) had released some resolutions asking State-owned enterprises to submit
dividend of the State holdings in joint stock companies. The NA had also
decided to collect 75% of interests from the joint venture Vietsovpetro
instead of 50% like before.
Dung
told the Daily that the sum was around VND28 trillion in 2013 and might be
higher when the fiscal year of some enterprises ends in March.
The
sum is real, not the book-keeping number, as it has been really submitted to
the State budget, Dung explained.
In
addition, local authorities took drastic measures for budget collection last
year. All 63 provinces and cities have issued directives or plans to
facilitate State budget collection, he added.
Tax
agencies launched inspections into over 60,000 enterprises, collecting over
VND13 trillion worth of taxes. The agencies also recovered over VND25.4
trillion, or 52% of total tax debts.
State
budget collection has drawn much attention as 2013 is considered as the
toughest year in recent years.
The
General Statistics Office earlier announced two more sources, added value of
the banking sector and the self-supporting housing service of residents,
contributing 5.36% and 3.96% of the nation’s gross domestic product (GDP).
Without the sources, the nation would have not reached 5.4% in GDP growth
last year.
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Bảy, 18 tháng 1, 2014
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