BUSINESS IN BRIEF 17/2 Vingroup greenlights e-commerce venture The Vingroup Joint Stock Company will enter the e-commerce market with the establishment of the VinE-com Limited Liability Company, according to a decision made by its board on Tuesday. Under the decision reached by the group's Board of Directors, Vingroup will contribute capital of about VND735 billion (US$35 million) to own 70 per cent of VinE-com. The group also announced the appointment of Vingroup's new CEO on the same day. Duong Thi Mai Hoa, 45, will assume the role of CEO of Vingroup and will replace the current CEO Le Thi Thu Thuy. Before joining Vingroup in 2013, Hoa was the finance director of Oracle Viet Nam Company and has previously held important positions in different commercial banks in Viet Nam. Thuy, who is still the group's vice president, will take charge of the new e-commerce service. The new service, launched with the establishment of the VinE-com company with a charter capital of VND1.05 trillion ($50 million), aims to create a trustworthy, high-quality online shopping channel in Viet Nam. As e-commerce has been identified as a key future strategy that has the potential to help the group garner more profits, the group has decided to appoint Thuy as both chairwoman and CEO of VinE-com. Thuy has broad experience in international markets and is known for her dynamic vision. These appointments will take effect from the day its amended registrations are approved by the Ha Noi Department of Planning and Investment. Vingroup is a real estate giant in Viet Nam and, besides its core business, runs businesses in various sectors, including healthcare, tourism, education and retail. Shares of Vingroup (VIC) rose by 0.6 per cent to VND78,000 ($3.7) on Thursday but slightly lost yesterday. E-customs system to begin in early April The Japan-funded Viet Nam Automated Cargo and Port Consolidated System and the Viet Nam Customs Information System (VNACCS/VCIS) will officially begin operating on April 1, Nhan Dan online newspaper reported. The news story cited the General Department of Customs as saying that the operation of the systems is a significant breakthrough in creating favourable conditions for export and import activities. While it takes between six and 15 minutes for the current e-customs procedure to check and complete customs clearance on every consignment, the application of the VNACCS/VCIS will help reduce the process to a few seconds. Viettel striving to expand in new markets Viet Nam's telecom group Viettel has obtained a license to provide mobile services in the African country of Burundi. It is one of the world's poorest nations, with an average gross domestic product (GDP) per capita of around US$200. Le Dang Dung, Deputy General Director of Viettel told Sai Gon Times that Burundi has a population of over 10 million people, of which some 10 per cent use mobile services. Therefore, Viettel has seen an opportunity to invest in the market. The group is preparing to set up Viettel Burundi Company and expand its business network throughout the country. VietJetAir offers 35,000 promotional air fares VietJetAir yesterday announced a promotion programme for its domestic and international routes, with 35,000 discounted tickets going on sale at prices as low as VND9,000 (US$0.43). The inexpensive air fares will be available from February 13-15 and applied to flights between February 13 and May 20. Dong Nai attracts nearly $178m in FDI Industrial parks in the southern province of Dong Nai attracted about US$177.8 million in foreign direct investment (FDI) during the first six weeks of 2014. More than 98 per cent of the figure were poured into the locality in January this year and made up19.8 per cent of the target set for 2014, said Mai Van Nhon, deputy head of the Dong Nai Industrial Park Management Unit. Also, during this period, domestic investors injected VND60.1 billion ($2.8 million) into the province, he said. Further, according to Nhon, 18 projects in the local industrial parks raised their existing capital by $106.1 million last month. — Nghe An Province promotes investment activities The central province of Nghe An last year granted investment certificates to 89 projects, with a total registered capital of VND13.75 trillion (US$6.54 billion). This represents a-year-on-year increase in investment of 145.4 per cent. Of this number, 84 are locally-invested projects with registered capital of VND13.3 trillion ($6.4 billion), while the remainder are FDI projects valued at $21.08 million. The province currently has 627 investment projects underway that include 588 locally-invested projects totally worth VND109.5 trillion and 39 foreign direct investment projects (FDI) valued at $1.49 billion. HCM City licences foreign projects The HCM City People's Committee licensed 15 new foreign-invested projects in January, with a total investment capital of US$20 million, a year-on-year increase of 51.5 per cent. During the month, the committee also allowed two operating projects to raise capital of $3.3 million. BNP Paribas backs VietJetAir BNP Paribas, a leading international aviation financer, was assigned as adviser and finance arranger for three new VietJetAir's aircraft, following an agreement signed between the two sides in Singapore on Thursday. The agreement was another step in VietJetAir's move towards ordering 100 aircraft from Airbus. This was finalised a few day ago at Singapore's Airshow. The first three aircraft, valued at $270 million, will be received by VietJetAir this year. "Air transport has been a vital part of the economy in Viet Nam and an important foundation for the development of the country. We are excited and looking forward to see the very first aircraft from this order, which will be due for delivery this year," said a BNP Paribas representative. Viet Nam eyes German housing-savings model The State Bank of Viet Nam and the Construction Ministry are planning to set up a housing savings bank after learning of such a model in Germany. The bank will help attract idle savings of the public for investment in housing development projects. In Germany, home buyers sign a contract savings scheme for housing based on the money needed for their house. People save a certain amount from their incomes in a savings account. Foreign firms granted listing codes The statistics of the Viet Nam Securities Depository show that 45 foreign investors, including 15 organisations and 30 individuals, were granted trading codes in January. As of January 31, securities trading codes have been granted to a total of 16,776 foreign investors, 86 per cent of them being individuals. PetroGAS posts $588m profit PetroVietnam Gas Joint Stock Corporation (GAS) has reported a net profit of VND12.384 trillion (US$588 million) for the year 2013, a 26 per cent increase over 2012. It was also 66 per cent more than the year's planned target. The earning-per-share (EPS) of GAS reached VND6,530 or $0.31. However, GAS's turnover in 2013 reached VND65.5 trillion or $3.12 billion, a slight decline of 4 per cent over 2012. HCM City-listed GAS traded at VND82,000 or $3.9 per share on Thursday. Central bank wants extension of loan periods Deputy head of the State Bank of Viet Nam's Credit Department Tran Xuan Chau said the bank wants solutions to accelerate disbursement of the VND30-trillion housing package for low-income people. Accordingly, SBV will propose extension of loan periods in the package from the current 10 to 15 years. The maximum period of loans provided to property businesses in the package is five years. Statistics from the Ministry of Construction's Housing Development Department showed that banks disbursed VND380.45 billion to eight businesses. Five banks had committed to lend a total of VND720 billion to 1,994 home buyers, of which VND482 billion was disbursed. FPT's revenue up 13 per cent FPT posted revenues of more than VND28.64 trillion ($1.36 billion) in 2013, a surge of 13 per cent against one year ago. The group's pre-tax profit reached VND2.51 trillion ($120 million), a year-on-year rise of 5 per cent. It also contributed VND4 trillion ($192 million) to the State budget, up 8.8 per cent. Last year, the group's core business industries experienced positive growth, especially ICT, which made up 75 per cent of its pre-tax profits. VietinBank helps fund $44m factory VietinBank and the Viet Nam Rubber Industry Group (VRG) have signed a grant contract worth more than VND930 billion (US$44 million) for the construction of a medium-density fibreboard processing plant. The plant, to be built on an area of 85,506 sq.m in Thanh Loc Industrial Zone in Chau Thanh District, the southern province of Kien Giang, will have a planned annual processing capacity of 75,000 cu.m. The project will be funded by the bank at a total cost of VND1.49 trillion ($709 million). Trade surplus hits record high of US$1.44 billion Trade surplus in the first month of this year hit a record high of US$1.44 billion including US$ 1.41 billion from the foreign-direct investment (FDI) sector and US$31 million from the domestic sector. The General Department of Vietnam Customs has reported that the country’s trade value in January reached US$21.48 billion, 9.9% less than previous month and 3% lower than the level recorded in last year’s same period. Of which, exports reached  US$11.46 billion, down 1.5% and 0.8%, respectively while imports were US$10.02 billion, down 17.8% and 5.5%, respectively. Goods that contributed to trade surplus include crude oil, coal, garment, footwear, wood and timber products, seafood, rice, electricity, telephone handsets and components. Vietnam, Customs Union conclude fourth FTA ministerial talks The fourth round of ministerial talks on a free trade agreement (FTA) between Vietnam and the Customs Union of Belarus, Kazakhstan and Russia wrapped up in Danang city on February 14. The round opened in the central city on February 9 under the co-chair of Vietnamese Minister of Industry and Trade Vu Huy Hoang and Eurasian Economic Commission Trade Minister Andrey Slepnev. In the spirit of cooperation, openness and mutual interest, the two sides basically agreed upon the content of the agreement. They set a target of concluding the negotiations by the end of this year. The two sides agreed to speed up information sharing and internal consultation as well as the progress of group negotiations for the next round, slated for March 31 to April 4 in Kazakhstan. Discussions focused on goods trade, rules of origin, customs management, technical barriers, sanitary and phytosanitary measures, investment, intellectual property and government procurement among others. Construction on SEA’s longest cross-sea bridge launched A February 15 order from Prime Minister Nguyen Tan Dung has launched construction on a longer than 5.4 km cross-sea bridge in Haiphong city. Once completed, it will be the longest of its kind ever built in Vietnam as well as Southeast Asia. Part of the Tan Vu-Lach Huyen Highway stretching more than 15km, the 5.4km section over the sea will take 36 months to finish at a cost of over VND11.8 trillion. Most of the budget comes from Japanese official development assistance (ODA) capital. The Tan Vu-Lach Huyen bridge’s modern construction will eventually become another highlight of Haiphong City’s Cat Ba Islands. Speaking at the ground-breaking ceremony, PM Dung emphasised the project follows a Public-Private Partnership (PPP) model between Vietnamese and Japanese Governments. It will help maximise the utility of the valuable deep water port, link Lach Huyen Port with other developing areas in Haiphong City and Dinh Vu industrial zone, and form a transport axis with the Hanoi-Haiphong Expressway connecting Hanoi and neighbouring provinces. It also furthers economic restructuring and advances industrialisation and modernisation, Dung said. He cited the project as demonstrating the friendship and fine cooperation between Vietnam and Japan The Government leader urged the Ministry of Transport, consultants, and joint venture partners to obey Vietnamese laws and contract commitments and execute the project on schedule. He asked Haiphong leaders to facilitate land clearance and take care of any relocated families. A 4E class international airport will be built at Lach Huyen Port to receive all kinds of aircraft. Haiphong has to fine-tune its development strategy. It should focus on training high quality human resources and attracting investment. PM Dung thanked Japan for the assistance extended to Vietnam over the past 20 years—especially in infrastructure development—and expressed hopes such support will continue into the future. He promises Vietnam has used Japanese ODA efficiently and effectively. VN, Laos promote “One-stop-shop” procedure at border gate Officials from the Vietnamese and Lao foreign ministries have inspected the Lao Bao-Densavan international border gate and held a conference to speed up the implementation of the one-stop-shop ( OSS ) model there. Attending the February 13-16 conference were Vietnamese Deputy Foreign Minister Ho Xuan Son and his Lao counterpart Buonkeut Sangsomsak. The OSS model aims to simplify administrative procedures by minimising the amount of offices to visit and paperwork to complete as much as possible. Inspections show that the gate’s infrastructure has been upgraded, with the two sides’ agencies working together to more closely supervise import-export and entry-exit activities. The border gate has successfully deployed a new e-customs system, helping shorten waiting time and increase precision during the customs clearance process. However, the two countries still have different regulations on customs and have yet to reach complete consensus on the best way to oversee procedures at the location. While the OSS mechanism has been applied unofficially at the gate for several years, it has not been properly managed and so has failed to prove effective, the Lao side said. Therefore, suggestions were made to rectify this at the conference. A plan was discussed to upgrade infrastructure and equipment further so that the OSS model can be officially and fully implemented on January 1, 2015. Accordingly, each side will set up a special working group in charge of preparing for the work. Japan considers ODA for Long Thanh airport project Yakabe Yoshinori, Japan’s Deputy Consul General to HCM City, held a working session with Dong Nai province’s leaders, examining Long Thanh International Airport project. Yoshinori said the Japanese government is considering granting official development assistance (ODA) to the project at the request of the HCM City-based Consulate General of Japan. However, the Japanese side is concerned about mixed arguments, with some opposing the construction of the airport and others proposing expanding the current Tan Son Nhat International Airport in HCM City or Bien Hoa airport in Dong Nai. Tran Van Vinh, vice chairman of the provincial People’s Committee, assured his guest local authorities have weighed up the pros and cons of options and confirmed building Long Thanh airport is the best choice. He explained the airport will be built in a less populated area, thus reducing land clearance costs in comparison with the Tan Son Nhat or Bien Hoa airport options. In addition, it is convenient to connect to Long Thanh International Airport, meeting regional development requirements. According to plan, the airport will be built on an area of 5,000ha with four runways. In the first phase, it will receive 5 million passengers and handle 5 million tonnes of cargos a year. Once completed, the it will be able to receive Airbus A380s. Yoshinori said he will make a proposal to the Japanese Foreign Ministry to consider an ODA grant to the project. US$2.5 bln for Vung Ang 2 thermal power plant Japan’s Mitsubishi Group is putting the finishing touches to the construction work of the US$2.5 billion Vung Ang 2 thermal power plant in Ha Tinh province due to begin in June 2014. VnExpress.net quoted Ngo Dinh Van, deputy head of the Vung Ang Economic Zone Management Board, as saying project appraisal is entering the final stage and investors are waiting for an investment license. He added Mitsubishi has also taken necessary steps towards land clearance. The Vung Ang 2 thermal power plant is to get off the ground in June 2014 The thermal power plant, which has two generators with a combined design capacity of 1,320MW, will sit on more than 42ha in Ky Anh district, next to its twin plant – Vung Ang 1. The plant, to be built in the form of Build-Operate-Transfer (BOT), is scheduled to generate power by 2018. Meanwhile, the Republic of Korea’s Samsung group is showing its interest in the Vung Ang 3 thermal power plant with a design capacity of 2,400MW. Representatives of the group have held a working session with Ha Tinh provincial leaders and agreed to invest in the project, said Van.    The investor is completing necessary procedures to get a license. The Foreign Investment Agency reported the central province of Ha Tinh attracted 53 foreign investment projects in 2013 capitalised at nearly US$11 billion. 100 best places to work in Vietnam Anphabe Company and Nielsen Vietnam announced a list of Vietnam’s 100 best employers at a ceremony in HCM City on February 14. Anphabe Company and Nielsen Vietnam announced a list of Vietnam’s 100 best employers at a ceremony in HCM City on February 14. The top of the list was dominated by companies including Unilever, P& G, Vinamilk, Nestle, IBM, Abbott, HSBC, Vietcombank, Microsoft, and Coca Cola. Rankings were decided according to criteria weighing salary, bonuses, welfare, professional development, culture and values, leadership, work-life balance, and company reputation. Unilever was recognised as the workplace with the most opportunities for professional development, while Vinamilk ranks first in terms of salary, bonuses, welfare, and leadership. Nestle led the field in culture and values. Microsoft was judged as having the best work-life balance. HSBC tops the employer list in banking and financial services, Microsoft in software, Unilever in consumer goods, Samsung in electronics and electric equipment, and Prudential in insurance. The Anphabe and Nielsen survey revealed employers are increasingly aware hiring the best staff now requires attractive compensation packages incorporating salary, bonuses, welfare, professional development opportunities, international work experience, leadership training, work-life balance, and workplace cultures that value equality and respect. Anphabe CEO Thanh Nguyen said the survey provides a comprehensive overview of contemporary employee expectations. It will help businesses refine the incentives offered to attract staff and proves the importance of healthy working environments. Nielsen Vietnam Research Department Director Mai Tuyet Hoa said Vietnamese businesses have focused on product branding instead of investing in a reputation as a generous and rewarding recruiter. The survey can be used to correct this imbalance. Domestic banking operations stable: central bank Domestic banking operations are stable, the State Bank of Vietnam (SBV) affirmed in a report on February 12. The commercial banks showed good liquidity from January, with the interest rates for deposits in Vietnamese dong (VND) ranging from 1% to 1.2% per year for terms of less than a month, 5% to 7% for one- to six-month terms, 6.5% to 7.5% for six- to 12-month terms, and 7.5% to 8.5%for terms over a year. For US dollar deposits, the popular interest rates were equivalent to the ceiling levels stipulated by the central bank, hovering around 0.25% for institutional depositors and 1.25% for the public. Low interest rates of 7% to 9% were maintained for VND loans in prioritised sectors, including agriculture and rural areas, export, small- and medium-sized enterprises, hi-tech firms and support industries. In other production and business areas, the rates were between 9% and 11.5% for short-term loans, and 11.5% to 13% for medium- to long-term loans. Some businesses with healthy finances and efficient performance enjoyed rates of 6.5% to 7%. For USD loans, the short-term interest rates varied between 4% and 6% and long-term levels were between 6% and 7%. The foreign exchange market also saw stable developments from January, as the market liquidity was good and the lending institutions were the net buyers in foreign currency transactions with their customers, while the exchange rates tended to decline. On February 13, the commercial banks bought a dollar for VND21,090 and sold it at 21,130 on average. The average inter-bank interest rate was VND21,036 per dollar, according to the SBV website. Vietnam holds most optimistic business expectations Vietnam is among the most optimistic countries in terms of business expectations, according to HSBC Holdings plc.’s latest Emerging Markets Index. The others which share the same optimistic business expectations are Indonesia and Poland. On the other hand, Vietnamese manufacturing growth gathered momentum, highlighted by the strongest rise in output since April 2011, and the fastest rise in purchasing activity in the survey’s history, HSBC said. In comparison with the Manufacturing Output Index of Taiwan (China), India, the Republic of Korea, China and Indonesia, Vietnam ranked second in December 2013 and in January 2014 after Taiwan (China). It followed Taiwan (China) and China to stand at the third place in November 2013. The HSBC Emerging Markets Index is a weighted composite indicator derived from national HSBC Purchasing Managers’ Index reports in 17 emerging economies, namely China, the Republic of Korea, Taiwan (China), Hong Kong (China), Vietnam, Indonesia, India, Brazil, Mexico, Turkey, the United Arab Emirates, Saudi Arabia, Egypt, South Africa, Russia, Poland, the Czech Republic. Vietnam, Australia boost economic, trade ties Vietnam and Australia can deepen their cooperation in areas such as education, agricultural development and mineral ore exploration, Australia’s Chief Minister of the Northern Territory has suggested. Adam Giles made the statement during a recent meeting with the Consulate General of Vietnam in Perth. He voiced his hope that relations between the Northern Territory and Vietnamese localities including Ho Chi Minh City, Haiphong and Ba Ria-Vung Tau will be further bolstered during his upcoming scheduled visit to Vietnam. Consul General to Perth Le Viet Duyen in turn noted Vietnam and the Northern Territory are partners on a number of fronts including trade, livestock, and seafood. He stressed his office is implementing a number of activities to further boost economic and trade relations along with enhancing cultural exchanges between the two countries. He also proposed the organizing board of Darwin festival join hands with Vietnam to promote culture exchanges between Vietnam’s Central Highlands and Australian Aboriginal people in future festivals. The Northern Territory is now one of the leading economic locomotives in Australia  with its gross domestic product (GDP) growth rate for 2013 estimated at 5%, worth nearly AUD20 billion. The Consulate General of Vietnam in Perth also met with overseas Vietnamese in Australia’s Northern Territory to celebrate the Lunar New Year (Tet) on February 2. Participants included leaders from the Territory and Darwin city, the Vietnamese community and representatives from Darwin’s multi-ethnic residents. Addressing the event, Le Viet Duyen recounted Vietnam’s socio-economic development achievements in 2013 in addition to activities marking the 40th anniversary of diplomatic relations between the two countries. He emphasized that the overseas Vietnamese community is an integral part of Vietnam and expressed his hope that they will continue to contribute to the economic development of the country. He also thanked the local authorities and people for helping the Vietnamese community integrate into society over recent years. Darwin's Lord Mayor Katrina Fong Lim spoke admirably of the Vietnamese community’s activities to preserve and uphold the national identity in the state and expressed her sincere pleasure that Vietnam will attend Darwin festival this year. She affirmed that the city will strive to create favorable conditions to assist the Vietnamese community, contributing to further enhancing ever deepening relations between the two countries. Lower VAT proposed for farm exporters A targeted value added tax (VAT) reduction would help businesses upgrade technology and develop high value added products, participants at a February 13 meeting in Hanoi have suggested. The meeting, convened to discuss agricultural policy, was attended by Minister of Agriculture and Rural Development Cao Duc Phat and representatives of ministries, agencies and businesses relating to the agriculture, fishery and salt sectors. Participants suggested reducing the VAT tax for businesses that export over 80% of their farm produce along with cutting interest rates from the current 11.5% per year to 5-6% per year. Priority should be given to key farm export items, such as rice, coffee, and tra fish, they said. Meanwhile, the State Bank of Vietnam (SBV) has asked commercial banks to lower interest rates for producers and exporters in line with proposals by a number of associations, including the Vietnam Cashew Association (Vinacas), and the Vietnam Coffee-Cocoa Association (Vicofa). According to recently released statistics, last year’s export turnover from agro-forestry and fisheries products increased 1.8% year on year to US$22.76 billion, contributing to a trade surplus of US$8.81 billion. EU lowers export fees on footwear Tariffs on Vietnam's footwear exported to the EU will be cut from 13-14 per cent to 3-4 per cent this year. This move is intended to bring the country's footwear exports in line with the EU's generalised system of preferences (GSP). To capitalise on the new regulation, which gives developing countries unilateral tariff preferences for the 2014-16 period, the Ministry of Industry and Trade has directed local footwear producers to design long-term investment policies that will help boost domestic sources of materials and develop ancillary industries. This will potentially raise the industry's competitiveness and reduce outsourcing for foreign footwear giants, it said. Although footwear is the leather industry's key product, the ministry has also asked local producers to pay attention to diversifying production to include high-quality handbags and wallets as these are also among the industry's most profitable lines. The footwear industry's export turnover was US$10.3 billion in the past year, up 18 per cent against the previous year. The EU is Vietnam's largest footwear importer, and Vietnam is the second-largest footwear exporter to the EU after China, with an export turnover of US$3.4 billion in 2013, accounting for 33 per cent of Vietnam's total footwear export turnover. Chairman of the Vietnam Footwear Association Nguyen Duc Thuan said, the GSP will present a good opportunity for Viet Nam's footwear exports to compete against the same products by EU producers. In addition to the GSP regulations, Thuan noted that the footwear industry is also expecting some concessions and incentives from the EU-Viet Nam Free Trade Agreement and the Trans-Pacific Partnership agreement as footwear is likely to be one of the major beneficiaries of these agreements. Under the EU-Vietnam FTA negotiation, at least 90 per cent of Vietnamese goods exported to the EU will enjoy a tax exemption.With these golden opportunities, the footwear industry is expected to gain at least US$12 billion from exports this year, Thuan said. Hai Phong calls for Japan’s HR development assistance The northern port city of Hai Phong wants to be introduced to Japanese leading experts who can help it develop a contingent of high-skilled human resources and an efficient support industry. The city is well aware of the values generated by high-quality human resources, Secretary of the municipal Party Committee Nguyen Van Thanh said while meeting with Japanese Ambassador to Vietnam Horoshi Fukada on February 14. Hai Phong is embarking on shaping up the support industry, he stressed. The official acknowledged that the city’s past achievements in infrastructure building, transport links, and environmental projects were contributed greatly by the Japanese Government. The Japanese diplomat showed his delight to see in-progress preparations for the construction of the Lach Huyen international deep-sea port in Cat Hai island district, and the Tan Vu-Lach Huyen sea-crossing bridge. He expressed his belief that these facilities, once completed, will draw more Japanese investors to the city. The Ambassador also shared his country’s experience in economic development, mentioning the contributions by high-quality human resources.- Ban on import of used vehicles issued The Ministry of Industry and Trade has issued a decree banning the importation of used cars, carriers, special purpose vehicles and ambulances over five years old effective from February 20. Under the new regulation, vehicle importers are also prohibited from importing vehicles with steering wheels on the right side, except for special purpose vehicles such as cranes, canal diggers, street cleaning trucks, water trucks, waste trucks, airport passenger buses, lift trucks and golf carts. Used 16-seat cars will continue to be permitted to be brought into the country through international ports, including Haiphong, Cai Lan (in northern Quang Ninh Province), Danang (in the central region), HCM City and Ba Ria-Vung Tau (in the south). Quang Ninh to host int'l economic zone forum Scientists and scholars from Viet Nam and overseas will share experiences in developing special economic zones (SEZs) at an international symposium on March 20-21 in the northern province of Quang Ninh. The event will be jointly organised by the province's steering committee for organising international conferences and the China Centre for Special Economic Zone Research, under Shenzhen University in the Chinese province of Guangdong, said the Quang Ninh provincial People's Committee at a press conference yesterday. Some 350 delegates are expected to attend the event and share information on the establishment and development of the world's industrial clusters, SEZs and free economic zones over the past 30 years, including introducing measures and policies that will help develop the SEZ model in Viet Nam in general and Quang Ninh, in particular. Nation accelerates rice trade with Africa Viet Nam now exports rice to more than half of the 55 African countries, and its major importers are the Ivory Coast, Ghana, Senegal, and Angola, as well as Cameroon. The Viet Nam Food Association (VFA) reported that Viet Nam exported some 6.6 million tonnes of rice in 2013. Africa is its second-largest rice importer after China, accounting for nearly 30 per cent of the total export value. Vietnamese rice is favoured in Africa due to its competitive price and good quality. Exports of fragrant rice to the continent currently have the highest growth rate. Last year, Viet Nam signed a memorandum of understanding (MoU) with Guinea to supply 300,000 tonnes per year to the latter from April 1, 2013, to December 31, 2015. PVcom Bank, Binh Son Refinery ink deal The Viet Nam Public Commercial Joint Stock bank (PVcom Bank) signed an agreement on comprehensive co-operation with the Binh Son Refinery and Petrochemical Company on Wednesday. Following the agreement, PVcom Bank will provide loans for investment projects of the Binh Son Company as well as for mobilising capital, payment and development of retail services with a network of 102 transaction branches throughout the country. Last year, the Quang Ngai-based Binh Son company earned a revenue of VND150.4 trillion (US$7.1 billion), with a profit of VND2.8 trillion ($133 million). The company also contributed 27.4 trillion ($1.3 billion) to the State Budget. January State budget revenue reaches US$3.4 billion State budget revenue in January was estimated at VND71.7 trillion (US$3.4 billion), the Ministry of Finance said. The sum accounted for 9.2 per cent of the year's estimate. Of the amount, VND53.3 trillion ($2.5 billion) was from domestic tax collections, according to data from the ministry. The State-owned economic sector experienced high budget collections, with a 12.9 per cent rise, and the private industry and trade sectors' revenues rose 9.3 per cent. The increase was attributed to robust production and trade in the past year and the first month of this year. Milk prices controlled The Ministry of Finance will cooperate with the relevant bodies to carefully manage domestic milk prices after one milk trader raised its retail price and with other traders expected to follow suit. The Ministry confirmed Mead Johnson Nutrition began 2014 by raising the prices of nine of its 35 milk products. Mead Johnson Nutrition says the increases were responses to a 12.6–12.8% surge in import costs last August. Losses incurred from other products also contributed to the decision. Nguyen Anh Tuan the Ministry of Finance’s Price Management Department Director,  said other dairy traders were asked to review their pricing strategies before proposing any price increases to the ministry. Existing regulations stipulate all six Vietnamese dairy traders must register any retail price changes for the Ministry of Finance’s official approval. The six traders are the Friesland Campina Viet Nam Ltd Co., Mead Johnson Nutrition Vietnam Ltd Co., Dinh Duong 3A Ltd Co., Tien Tien Distribution Ltd Co., Nestle Vietnam Ltd Co., and Organic Vietnam Trading and Development Joint Stock Co. Tuan noted the ministry has yet to give the green light to the proposed price hike. Instead, it has asked the company for a more detailed explanation of its motivating reasons. Four milk traders have thus far registered no retail price increases. Milk products typically rise at the start of the year, before stabilizing, Tuan said. The department will follow developments closely and work to protect market stability. The ministry has asked the Ministry of Industry and Trade and other relevant ministries for assistance with monitoring the dairy market. Garment sector experiences boom with bulk orders The Ministry of Industry and Trade confirms the US, the EU and Japan were the three key importers of Vietnam’s garments and textiles in January. Businesses have secured orders until the end of the first quarter of this year and some major companies have orders till the end of the second quarter. According to the General Department of Vietnam Customs, the sector fetched more than US$1.9 billion from textile and garment exports in January alone, up 10.6% from one month earlier and up 21.7% over the same period last year. Of the figure, foreign-invested enterprises (FDI) earned US$1.13 billion, accounting for 59.4% of the sector’s total export turnover.  The US, EU and Japan continue to become the three largest importers of garment and textiles with turnover reaching a staggering US$955 million, US$302 million and US$228 million respectively. Vietnam Seafood Festival 2014 – a great chance for businesses The Vietnam Seafood Festival this year will create plenty of opportunity for participants with 12 large-scale events being held in economics, investment, trade and tourism promotion. The information was revealed at a press briefing in Ho Chi Minh City on February 16 by the People’s Committee of the central coastal province of Phu Yen, who will host the event from March 28 to April 2. Under the theme “Vietnamese Seafood – Integration and Development”, the festival aims to honour the craft of seafood farming and fishing, especially tuna fishing, contributing to protecting national sovereignty. The event also offers chances for seafood business to enhance their connectivity, while introducing and promoting the tangible and intangible cultural values of Vietnam’s coastal localities. A highlight of the festival will be a ceremony marking the 55th anniversary of the Vietnamese seafood sector. A seafood, industry and trade fair and exhibition for the central southern coastal region is also being hotly anticipated. A seminar will be held to discuss ways to boost the sustainable development of the sector, coupled with a conference to review three years of the implementation of Vietnam’s aquatic development strategy until 2020. Manufacturers spark economic impetus Manufacturers are providing an impetus for better economic growth this year. Domestic garment maker Company 26, one of the biggest garment exporters in Hanoi, announced that its revenue in the first two months of this year would rise by a record 20% year on year. “Local and overseas demand is recovering, so we have to increase production and recruit more workers,” said Nguyen Viet Thang, director of one of the company’s factories. Company 26’s story is reflected in HSBC purchasing managers’ index (PMI) report release in early February that started “growth in the Vietnamese manufacturing sector gathered momentum in early 2014, highlighted by the strongest rise in output since April 2011, and the fastest rise in purchasing activity in the survey’s history.” The headline seasonally adjusted PMI – a composite indicator designed to provide a single figure snapshot of operating conditions in the manufacturing economy – increased for the second month, from 51.8 in December 2013 to 52.1 in January 2014. A fourth successive monthly increase in Vietnamese manufacturing output from 52.6 to 53.5 reflected rising demand for Vietnamese goods, according to the report. Furthermore, the new export orders sub-index mirrors this trend, with the sub-index increasing to 52.2 from 49.1 in December 2013. The most positive jump came from the quantity of purchases, which rose to 55.2 from 53.8 in December, reflecting stronger demand of goods for production. Nearly 23% of respondents said new business from abroad had increased while over 15% of respondents had increased employment during January, and over 27% of those interviewed reported a fall in backlogs. However, Asian Development Bank (ADB) country director Tomoyuki Kimura told Vietnam Investment Review that, “private consumption will remain subdued for some time in light of sluggish job creation and continued weak consumer confidence.” “The measures to stimulate house building are expected to have limited impact in construction. In the service sector, stronger growth in financial services depends on making headway on bank restructuring, and a pickup in consumer-oriented services hinges on the health of the labour market,” he stressed.  ADB expected gradual progress in dealing with non-performing loans to slightly lift economic growth to 5.5% this year, slightly higher than 5.42% last year. Meanwhile, HSBC forecast Vietnam’s economy would grow 5.6% in 2014. In his new year message, Prime Minister Nguyen Tan Dung said the government targets gross domestic product (GDP) growth of 5.8% and inflation pegged at 7%. Minister of Planning and Investment Bui Quang Vinh argued Vietnam has many problems that need to be solved to reach this target. “For example, it is unacceptable that almost all local production depends on bank loans. Slow reforms in the banking sector will continue hampering production and growth,” he said. HSBC economist Trinh Nguyen said, “Domestic firms, especially small and medium-sized enterprises (SMEs), are suffering from tough credit conditions, lackluster domestic demand and declining competitiveness. This means that policymakers will have to address issues hindering the performance of domestic firms to sustain growth in the medium and long term.”   Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR