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BUSINESS
IN BRIEF 28/3
US decides
to retain tax on imported mattress innersprings
The
The US
International Trade Commission (USITC) on March 25 determined that the
revocation of the existing tariff on uncovered innersprings imported from the
three countries would likely cause remarkable economic losses for US-based
companies.
According to common
regulations, the anti-dumping duty order will be revoked after five years
unless the US Department of Commerce and USITC vote against it.
The country imposed
the tax for mattress inner springs imported from
The current
anti-dumping tax rate on the springs from
Highlands
firms invest in Laos, Cambodia
Companies based in
the Tay Nguyen (Central Highlands) region have invested US$1.5 billion in
Of the 35 projects
they have invested in,
They were mainly in
the agricultural, forestry, and fishery sectors, which accounted for $1.18
billion of the investment.
Ministry to
improve steel quality control
The ministries of
Industry and Trade and Science and Technology have issued a Joint Circular
No. 44 to better manage the quality of domestically produced and imported
steels.
Accordingly,
domestic steel producers will have to apply the national technical standards
on their production. The circular, which will come into effect from June,
also makes it mandatory for steel importers to announce the standards applied
in their import contracts. Based on the applied standards, the authorities
will assess whether the consignments are eligible for import to
According to the
domestic steel producers, the circular will not only tighten steel quality
management, but will also prevent unhealthy competition from cheap, imported
steels in the market.
Addressing a
conference on the management of steel production and imports held in Ha Noi
on Tuesday, Chu Duc Khai, the vice chairman cum general secretary of the Viet
Nam Steel Association (VSA), stated that last year, large amount of steels
was imported into the country.
Khai believes that
cheap, imported steels sold along with domestically produced steels have
affected the reputation of local brands.
He further added
that imported rolled steels, containing 0.0008 per cent boron (Bo) element,
were labelled as metal to enjoy a tax preferential of zero per cent.
The ministry will
be responsible for selecting only those domestic or foreign organisations,
which have the ability to clarify the standards.
Sharing his ideas,
Nguyen Van Phong, the deputy general director of the NS BlueScope Viet Nam
Company was quoted as saying by the online newspaper that the circular will
improve steel quality, thus benefiting consumers.
However, Phong
noted that if the assessment on steel production and imports was not strictly
implemented, steel products will be stuck.
He expects that the
relevant agencies will closely cooperate to ensure product quality and
shorten evaluation time.
According to a
representative from the ministry's Science and Technology Department, both
domestic and foreign invested steel producers will have to follow the
circular.
As per statistics
revealed by the ministry, steel output in the first two months of the year
was 283,000 tonnes, a 26 per cent reduction as compared to the same period
last year.
The steel
production in the association was 255,057 tonnes, posting a 21 per cent
decrease over the previous month.
VSA has forecast
that this year, the demand for steel will not be high.
The total steel
consumption was estimated at 12.2-12.5 million tonnes, increasing 3-5 per
cent against 2013.
The ministry also
noted that it will collaborate with the Ministry of Science and Technology to
conduct check-ups on the quality of steel exported by other countries to
The costs for
conducting the check-ups will be borne by the importers under the Ministry of
Finance's regulations.
Rice
exports reach 1.31 million tonnes in Q1
In March alone, the
country shipped 524,000 tonnes, grossing US$243 million in export revenue.
The average export
price of rice bumped up 8% compared to Q1 of 2013 to US$486.5 per tonne.
With these positive
results, the
The Vietnam Food
Association (VFA) forecasts that
At present, the
price of dried paddy at stores in the Mekong River Delta is hovering around
VND5,250-5,350 per kilo while the price of long-grain paddy is holding steady
at about VND5,550-5,650 per kilo.
The price of 5%
broken rice ranges from VND7,750-7,850 per kilo while 15% broken rice varies
from VND7,500-7,600 per kilo and 25% broken rice at VND7,250 -7,350 per kilo,
depending on locality.
International
trade fair attracts businesses
As many as 180
local and foreign businesses are showcasing and promoting their products and
services at an international trade fair which opened in Dien Bien province on
March 26.
On display at
nearly 400 stands are handicrafts, processed industrial products, household
utensils, electronics, information technology, and fashions.
The five-day fair
offers participating businesses the chance to seek partnerships and expand
overseas outlets, especially in
The fair, held by
the VNEXPO International Exhibition Fair Company, is part of the national key
trade promotion programme for 2014.
Russian
aviation firm launches office in Vietnam
Russian joint stock
company Aviazapchast on March 26 officially announced the opening of a
representative branch in
Aviazapchast, a
leading Russian distributor of aircraft, helicopters, components and
aerodrome services, has been a leader in the industry for more than 45 years.
It briefly made an
appearance in
Policy
recommendations for new growth model
The proposal was
made by Professor Tran Tho Dat, Vice Rector of the
The Vice Rector of
the
However, after the
economic recession in 2009, growth slowed down significantly and has yet to
pick up much speed, he said.
“Success may only
be reached by shifting to a new growth model that is based on the efficiency
of mobilising resources to improve industrial competitiveness, technological
standards and productivity,” the Professor said.
He also claimed
that increasing links between domestic enterprises and multi-national groups
is a sound way to reach this goal.
At the seminar,
economic experts also put forth a number of policy recommendations to further
improve the role of foreign direct investment (FDI) and create a new
sustainable growth momentum for
Although
According to
Professor Kenichi Ohno from Japan’s National Graduate Institute for Policy
Studies (GRIPS), despite a remarkable structure shift from agriculture to
industry in the past two decades, Vietnam’s added production value only reached
19.7% in 2010, much lower than those of Thailand, the Republic of Korea
(RoK), Malaysia and Indonesia.
The country’s
industrialisation remains modest compared to other Asian nations such as
However, the
Japanese expert also acknowledged the Vietnamese Government’s efforts in
cooperating with the private sector to create higher internal value.
Vietnam needs to
have a FDI marketing strategy, build the capacity for domestic enterprises
and increase collaboration between foreign and local firms while
improving logistics services and industrial human resources, he stressed.
Vietnam-Thailand
trade increases sharply
Two-way trade
between
In the first two
months of 2014 alone, bilateral trade value expanded 1.8% to US$1.4 billion.
Currently,
Thai consumer goods
are popular with Vietnamese people (Photo:vinaxad)
At a press briefing
in
She said TCEB will
support trade ties between the two countries’ business communities through
exhibitions and trade promotions, aiming to raise bilateral trade to US$15
billion by 2020.
ODA
disbursement on the rise in Q1
Official
Development Assistance (ODA) disbursement in the first quarter of this year
is estimated at US$364 million, up 5% from the same period last year.
Of the total,
US$331 million is worth of loans and US$33 million in non-refundable aid,
according to the Ministry of Planning and Investment.
Two ODA projects
were signed in the first quarter: the Vietnam Road Asset Management Project
worth US$251.7 million funded by the World Bank and the
In the reviewed
period, foreign direct investment (FDI) decreased by 49.6% to US$3.334
billion. However, the FDI sector was the main contributor to the country’s
US$1 billion trade surplus in three months.
The FDI sector’s
export value was estimated at US$20.78 billion (excluding crude oil),
accounting for 62.3% of the country’s total export value.
Its import value
was US$18.55 billion. Thus, the sector enjoyed a trade surplus of US$3.92
billion (including crude oil) and US$2.23 billion (excluding crude oil).
Huge potential for
trade cooperation between
VCCI Vice Chairman
Hoang Van Dung emphasised that
Spanish Ambassador
to Vietnam Alfonso Tena said the meeting has created a good chance for the
two business communities to strengthen cooperation and seek trade partners.
Minister José
highlighted that
Spanish business
representatives answered questions relating to trade and investment.
Two-way trade
between
Signatories of the
meeting minutes include Deputy Minister of Industry and Trade Le Duong Quang,
who headed the Vietnamese team at the committee, and Ahmed H. Salah, Deputy
Minister of Economics-Planning and leader of the Saudi Arabian delegation
During the meeting,
both sides underscored the implementation of cooperation programmes to ensure
energy security and food for the two countries. They also closely explored
measures to activate Saudi initiatives on pouring money into foreign markets.
The two sides
prioritised bilateral future collaboration in agriculture, oil and gas, and
agreed to step up negotiations securing investment protection, marine
transportation and cooperation between their press agencies.
According to the
Ministry of Industry and Trade, two-way trade between
Last year,
Workshop
shares
A workshop to
introduce
The event is one of
a number of cooperative activities organised between the United Nations
Development Programme, the Vietnam Academy of Social Sciences and the
National Finance Supervision Committee (NFSC).
As well as
illustrating banking reform in
Dr. Syafruddin
Temenggung, former Chairman of the Indonesian Bank Restructuring Agency
(IBRA) said
This is the optimal
measure for settling credit and banking issues that could have a negative
impact for
According to
Chairman of the NFSC Vu Viet Ngoan, short-term measures recently taken by the
Vietnamese Government to contain the spread of financial insecurity and
stabilise the trust of the people have proven efficient, as the bad debt rate
dropped to just 3.6 percent in 2013.
Ngoan stressed it
is necessary for Vietnam to increase the transparency of its financial
system, especially restructuring financial supervision and fostering
coordination between financial supervision agencies and those operating in
policymaking.
Opportunities
for unlisted public companies abundant: official
Numerous
opportunities remain for unlisted public companies in 2014 to mobilise
capital, improve financial strength and access bank loans via the stock
market, the Chairman of the State Securities Commission of Vietnam has said.
Speaking at a
conference for this group of businesses in
In 2013, foreign
direct investment into
In addition, once
the Trans-Pacific Partnership agreement is signed, there will be an influx of
foreign investment into the country, Bang said.
He went on to claim
that the forthcoming derivatives market, which is expected to start operation
by the end of 2015, will diversify investment channels and better foreign
investment attraction further.
Deputy General
Director of the Hanoi Stock Exchange (HNX) Nguyen Anh Phong said listing on
stock exchanges such as the HNX, the Ho Chi Minh City Stock Exchange (HOSE)
and the unlisted public company market (UPCOM) is an inevitable trend for
Vietnamese joint stock companies in the coming time.
EU to offer
400 mln EUR assistance to Vietnam
The European Union
(EU) will raise the amount of development assistance for
The figure is
substantially more than the 298 million EUR sum provided from 2007-2013.
Meeting with Deputy
Prime Minister Pham Binh Minh in
He also reaffirmed
the EU’s commitment to concluding the Free Trade Agreement (FTA) negotiations
with
Deputy PM Minh, for
his part, suggested that the EU ratify the comprehensive Partnership and
Cooperation Agreement framework, and recognise Vietnam as a market economy
before concluding the EU – Vietnam FTA talks by this October.
Positive signs for coal industry in early 2014
In the first two
months of this year, the coal industry made positive changes with a 4-percent
increase in production and nearly 6 million tonnes consumed, contributing to
fulfilling the yearly plan.
I n the reviewed
period, the corporation mined 6.58 million tonnes of coal, fulfilling 17.4
percent of the yearly plan, the English-language Vietnam Economic News cited
sources from the Vietnam National Coal andMineral Industries Corporation
(Vinacomin) as saying.
Coal consumption in
the first two months of this year reached 5.8 million tonnes. Of this,
domestic consumption and exports reached 4.38 and 1.44 million tonnes,
accounting for 18 percent and 16 percent of the yearly plan, respectively.
Vinacomin Deputy
General Director Nguyen Van Bien said that in the period, coal supply to the
power sector also strongly increased, reaching 2.64 million tonnes, an
increase of 2 percent compared to the same period last year.
In addition, the
supply of the mineral to the fertiliser, paper and cement sectors reached
226,000 tonnes, 24,000 tonnes and 791,000 tonnes, respectively.
According to
Vinacomin, coal consumption would increase as Mong Duong II Thermal Power
Plant is put into operation this month.
Hoan also said that
the company adopted a temporary supply plan with an average volume of 60,000
tonnes per month for the thermal power plant. Once operational, the plant
will consume about 20,000-30,000 tonnes of coal per day.
This is a major
advantage for coal consumption in Cam Pha district. In addition, it will
contribute to balancing energy source and improving efficiency for the
national power grid.
Vinacomin has set
targets of consuming 35 million tonnes of coal and reaching total revenues of
105.5 trillion VND (nearly 5 trillion USD) for 2014. In addition, the company
will focus on stabilising production, promoting consumption and improving
product quality.-
The Vietnamese
stock market is preparing to leverage exchange traded funds (ETFs) and
would-be derivatives to lure more capital, heard a workshop in
Regulators are
speeding up legal and technical preparations so that the first ETFs could
start operations in the second quarter of this year, Nguyen Son, head of
market development department under the State Securities Commission, was
quoted by the Vietnam Investment Review as saying.
ETFs are funds that
track specific indices and whose portfolios include a basket of stocks. To
date, all operating funds in
The Ho Chi Minh
Stock Exchange (HOSE) and the Hanoi Exchange (HNX) are finishing rules for
product design and trading mechanism of ETF certificates. The Vietnam
Securities Depository is completing a project that allows clearing of ETF
products and deals with risks related to ETF transaction cancellation.
After all the steps
are finished and piloted at stock exchanges, the first ETFs will be launched
into transaction.
Also in order to
leverage and better facilitate the market, the two bourses would become one
in the coming time, before
Regarding
derivatives, Prime Minister Nguyen Tan Dung on March 11 approved the project
to build up and develop the derivatives market, which would include such new
products as share purchase rights, covered warrants, option contracts, as
well as traditional products like as shares and bonds.
Son said the
derivatives launch over the next two years is seen as another step towards
completing the country’s stock market structure, supporting development of
bond and stock markets and strengthening the role of the stock market in the
financial industry and the entire economy.
The new market
would be developed from simple to complicated products, Son told the
workshop, co-organised by Vietnam Investment Review and PetroVietnam
Securities Inc. (PSI).
The PSI is the
manager and operator of PVN-Index, the Vietnam National Oil and Gas Group
(PetroVietnam) launched in 2012 to measure the business performance of
enterprises in the country’s oil and gas sector.
France-based
Intelligent Financial Research & Consulting (IFRC), specialised in the new
development of new indexes and in the customised index services, wanted to
develop many new products based on PVN-Index, said IFRC founder and CEO Dr.
Mai Huu Minh.
He added an idea
from PSI and IFRC cooperation was to extend the idea of PetroVietnam to other
leading Vietnamese companies like state utility Electricity of Vietnam and
Petrolimex.
PVN-Index is
currently a basket of 32 share codes, including PVN-10 Index representing the
sector’s top 10 companies. The 32 codes account for 20 percent of the market
capitalisation.
Corruption makes for expensive projects
After the JTC
bribery scandal was exposed, economist Pham Chi Lan said that transport
construction projects in
This is not the first
time Vietnamese officials have been accused of taking bribes from foreign
firms. According to Lan, this will harm the credibility of Vietnamese
authorities in the eyes of foreign investors as well as the country's
citizens. "Since our management of ODA projects has already shown many
shortcomings, I'm not surprised by this allegation. I'm just sad that state
agencies don't have the ability to discover this case themselves," she
said.
She went on to say
that the scale of corruption is likely to increase along with the increase in
the scale of projects. Corruption cases in
She said, "The
Minister of Planning and Investment said the projects are three times more
expensive than estimations, and the Minister of Transport announced that
construction costs are two to three times higher than original estimates.
There is simply no other explanation as to why our construction costs are so
much higher, and our quality lower, than in US and
Speaking on the JTC
bribery allegations, which have been widely published in the Japanese media,
Lan added that the Ministry of Transport acted quickly and decisively in this
case.
In 2007, officials
from the Japanese Pacific Consultants International said that they gave
thousands of USD to the director of the
"When we
hesitate, we take the risk of creating negative impacts. If I remember
correctly,
Addressing the
number of corruption cases and cases brought to trial, Lan said that the
outcomes, even of prominent cases such as that of Duong Chi Dung from
Vinalines, were not really satisfying. Large-scale corruption must
necessarily involve many people, yet many times only one individual is held to
account, she added. "It's correct to suspend the four officials in
this JTC case, but we need to dig deeper for more connections in order to
find the root cause."
VND 1.2
trillion for Coc Hai 1 wind power plant
Saigon Industry
Corporation, Power Generation Corporation 2 and Electric Power Trading
Investment Corporation signed a cooperation document to build Coc Hai 1 Win
Power Plant in
The project will
cost nearly VND1.2 trillion (US$ 57 million) in two phases.
The first phase
will begin June this year costing VND 190 billion (US$ 9 million) to build
three 1MW turbines. They are scheduled to complete by the end of this year
and begin operation next year.
The plant will be
built under low-cost technology and will be able to generate power at a
capacity 2.5 times higher than present power plants.
Tra fish
price rockets in Mekong Delta
The price of tra
fish has continuously increased recently reaching the highest rates in the
last two years in the Mekong Delta.
On March 25, processing
plants paid VND 25,000-25,500 a kilogram, an increase of VND200-400 over last
week.
Farmers profit VND
1,500-2,000 from these prices.
The price increase
is due to the scarcity in production, said Nguyen Van Dao, director general
of Go Dang Company. Prices are expected to rise further as demand remains
high.
US$2
billion investment in Vinh Tan 1 thermal power plant
An engineering,
procurement and construction (EPC) contract worth over US$2 billion for
construction of the Vinh Tan 1 thermal power plant construction in southern
Binh Thuan province, was signed on March 25.
The new 1,200MW
plant, which is part of the Vinh Tan Power Centre in Tuy Phong district, Binh
Thuan province, including two 600MW units, is funded by the Southern Power
Grid Com. Ltd., the China Power International Development Limited Company and
the Power Corporation under the Vietnam National Coal-Natural Industries
Corporation in a build-operate-transfer contract.
Once construction
is complete in 2018 by the China Energy Engineering Group, the plant will be
run commercially for 25 years and the investors will hand it over to the
State.
The plant is
expected to supply about 7 billion kWh annually to the electricity grid to
help provide further power for the south and reduce dependence on
hydroelectric power, especially in the dry season, as well as the power
transferred from the north.
Sea freight
charges to rise next month
Shipping lines have
announced to increase their sea freight charges by hundreds of U.S. dollars
per container shipped from Vietnam to major markets, including the United
States, Europe and Australia.
In an announcement
sent to customers, the container shipping line Hapag-Lloyd said it would lift
the freight charges for goods exported from Vietnam and other countries to
the U.S. and Canada. The increases are US$240 for a 20-foot container and
US$300 for a 40-foot container.
Cosco and U.S.
Lines will also take the same move.
Shipping lines will
push up the charges on other routes, with rises of US$150 for a 20-foot
container and US$250 for one 40-foot container transported from Asia to
Northern Europe countries and the Mediterranean from next month.
Besides, the
charges of goods shipped from Vietnam to Australia will be up US$200 and
US$400 for 20-foot and 40-foot containers respectively.
For the cargo to be
imported into Vietnam, Hapag-Lloyd and other shipping lines plan US$40-100
more from April 15.
The shipping lines
explained that the existing charge rates were not sufficient for them to
cover the operational costs, including the fuel bills.
However, the
director of a foreign shipping line said fuel was just one of the factors for
the charge adjustment. He added that big lines were also trying to cover the
losses caused by supply outperforming demand.
“There is a gap
between the supply of container ships and the demand for cargo
transportation,” he said.
FDI firms
still want to hold on to investment certificates
While the board in
charge of amending the Investment Law is planning to streamline the
procedures for establishment of new businesses, many foreign direct
investment (FDI) enterprises maintain that they still need investment
certificates as they believe this paper is the passport for them to get
continued incentives.
Speaking at a
dialogue between FDI firms and authorities in HCMC on March 24, Minister of
Planning and Investment Bui Quang Vinh said the ministry was seeking to
simplify investment procedures through the amendments to the Investment Law
and Enterprise Law. Toward this end, the ministry is considering removing the
investment certificate and only maintain what would help authorities manage
the FDI sector effectively.
However, after
three dialogues were held in the north, center and south of the country, the
ministry has received mixed feedbacks, with some foreign firms expecting the
issuance of investment certificates to be scrapped but others wanting it to
stay.
Most firms in the
latter group wanted to keep this certificate so that they could enjoy the
Government’s incentives prescribed on the certificate. In addition, this is a
legal basis for investors to rent land or apply for bank loans, Vinh said.
However, Vinh said
the ministry would consider abolishing the issuance of investment
certificates, except for conditional industries, and those using much land,
possibly polluting the environment or needing licenses to get investment
incentives.
In the long term,
investors would have no need to obtain any investment certificate any more,
Vinh added.
If this comes true,
almost all FDI enterprises would just register with authorities to set up a
company like domestic investors.
Many FDI firms and
representatives of investment licensing agencies at the seminar also
complained about time-consuming business establishment procedures.
Le Manh Ha, vice
chairman of HCMC, said the city had faced a lot of difficulties in granting
investment certificates.
Despite much
effort, the city has missed the deadline in giving certificates to investors.
Some investors have suffered a delay of nearly eight months due to much time
spent on consulting ministries and doing other procedures.
As per the current
law, ministries have to comment on an investment project within 15 working
days but in most cases, they reply after one or two months, Ha said.
Some foreign firms
also bemoaned other challenges in the business environment in Vietnam such as
complicated tax and customs procedures and the shortage of skilled labor.
Ministry
requests further explanation for huge airport project
Minister of
Planning and Investment Bui Quang Vinh returned a report on the big-ticket
Long Thanh International Airport project to Airports Corporation of Vietnam
(ACV) last Friday, asking the firm to fine-tune it before it can go before
the Government.
The State assessment
council for the project, headed by the minister himself, was originally
scheduled for last Friday to decide whether the project could proceed to the
Government and the National Assembly in May.
The project was
submitted to the ministry in August last year. According to the Ministry of
Transport and ACV, the project would help improve the nation’s air transport
capacity. Meanwhile, HCMC-based Tan Son Nhat International Airport with a
maximum capacity of 25 million passengers a year will become overloaded in
2016.
The project would
be developed in three stages. ACV has presented the first stage between 2016
and 2025, in which an international transshipment terminal would go up with a
capacity of 25 million passengers a year.
Last month, the
council asked ACV to explain five key issues, including the reason for
construction of Long Thanh Airport instead of expanding the Tan Son Nhat
airport or upgrading Bien Hoa airport, scale of the project, traffic
connectivity issue, site clearance and compensation, cost and economic
efficiency.
Speaking at the
second assessment meeting last Friday, Minister Vinh said this is a single
project that has the biggest cost ever for one stage, at US$7.8 billion,
while its land needs will reach the highest level, over 5,000 hectares.
Caution should be practiced, he proposed.
“Without a clear
explanation, the project could not be passed to the Government and the
National Assembly, especially at a time of financial hardship,” Vinh said.
ACV general
director Nguyen Nguyen Hung sent a document to the council making clear the
five issues. However, it failed to satisfy the inspection group, the
assessment council and experts.
Nguyen Xuan Tu,
head of an assessment group for the project, said the report did not mention
shortcomings and difficulties which Long Thanh airport project might face.
The investor has
not made clear whether the planned airport could meet the regional traffic
connectivity target or demands and challenges in site clearance, he said.
La Ngoc Khue,
former Deputy Minister of Transport, said ACV should provide a clearer
explanation for how to raise huge funds.
Minister Vinh
requested ACV to make clear the issue and finish the report within 15 days.
Vietnam
pushing stock market with ETFs, future derivatives
The Vietnamese
stock market is preparing to leverage exchange traded funds (ETFs) and
would-be derivatives to lure more capital, heard a workshop in Ho Chi Minh
City March 25.
Regulators are
speeding up legal and technical preparations so that the first ETFs could start
operations in the second quarter of this year, said Nguyen Son, head of
market development department under the State Securities Commission.
ETFs are funds that
track specific indexes and whose portfolios include a basket of stocks. To
date, all operating funds in Vietnam are closed-end funds.
The Ho Chi Minh
Stock Exchange (HOSE) and Hanoi Exchange (HNX) are finishing rules for
product design and trading mechanism of ETF fund certificates. The Vietnam
Securities Depository is completing a project that allows clearing of ETF
products and deals with risks related to ETF transaction cancellation.
After all the steps
are finished and piloted at stock exchanges, the first ETFs will be launched
into transaction.
Also in order to
leverage and better facilitate the market, the two bourses would become one
in the coming time, before Vietnam’s derivatives market was set to open in
2016, Son said. The Government would soon make the final decision on merging
the two stock exchanges.
Regarding
derivatives, Vietnamese Prime Minister Nguyen Tan Dung on March 11 approved
the project to build up and develop the derivatives market, which would
include such new products as share purchase rights, covered warrants, option
contracts, as well as traditional products like as shares and bonds.
Son said the
derivatives launch over the next two years was seen another step towards
completing the country’s stock market structure, supporting development of
bond and stock markets and strengthening the role of the stock market in the
financial industry and the entire economy.
The new market
would be developed from simple to complicated products, Son told the
workshop, co-organised by Vietnam Investment Review and PetroVietnam
Securities Inc. (PSI).
PSI is the manager
and operator of PVN-Index, the Vietnam National Oil and Gas Group
(PetroVietnam) launched in 2012 to measure the business performance of
enterprises in the country’s oil and gas sector.
France-based
Intelligent Financial Research & Consulting (IFRC), specialised in the
new development of new indexes and in the customised index services, wanted
to develop many new products based on PVN-Index, said IFRC founder and CEO
Dr. Mai Huu Minh.
He added an idea
from PSI and IFRC cooperation was to extend the idea of PetroVietnam to other
leading Vietnamese companies like State utility Electricity of Vietnam and
Petrolimex.
PVN-Index is
currently a basket of 32 share codes, including PVN-10 Index representing the
sector’s top 10 companies. The 32 codes account for 20 per cent of the market
capitalisation.
Q1 GDP
rises to three-year high
The nation’s gross
domestic product (GDP) in the first quarter of 2014 has increased 4.96% over
the same period last year, the strongest rise in three years.
The rate is lower
than the 5.97% recorded in 2010 and 5.9% in 2011 but higher than the 4.75%
achieved in 2012 and 4.76% in 2013, according to a report released by the
General Statistics Office (GSO) on March 24.
The primary
industry has reported growth of 2.37%, nearly the same as in 2013 at 2.34%.
Of the figure, agriculture is up 1.91%, contributing 1.41 percentage points
to the total rise, as it accounts for the highest ratio in the industry.
Meanwhile,
construction and services have advanced 4.69% and 5.95% respectively, higher
than last year’s respective figures at 4.59% and 5.68%.
The GSO’s report
said supply and demand remained weak in the first quarter. Notably, the
industrial sector, especially manufacturing and processing, and enterprises
were still mired in hardship.
On the demand side,
the GDP growth rate in the first quarter was similar to 2013 with a heavy
reliance on the trade surplus. However, the foreign direct investment (FDI)
sector contributed the most to the trade surplus, doubling the domestic
sector.
In the
January-March period, the nation has generated export sales of over US$33.3
billion, up 14.4% year-on-year, and spent US$32.3 billion on imports, a 12.4%
increase. These growth rates are lower than in 2013, at 19.7% and 17%
respectively.
In addition, the
GSO warns of “silent ownership restructuring” among economic sectors. This
suggested that mergers & acquisitions (M&A) turned active with more
foreign investors acquiring domestic firms. However, GSO did not provide
specific data about the issue.
The report also
suggested reconsidering interest rate policies in the banking restructuring
scheme as the return on equity of enterprises was low during the 2000-2010
period, reaching the highest at nearly 5% in 2006 and the lowest at 4% in
2010.
Vietnam to
import 150,000 cattle from Australia
Vietnam is likely
to import more than 150,000 cattle from Australia this year, thus becoming
its second largest cattle buyer behind Israel, said Vietnam’s trade
commission in Australia in a statement posted on ttnn.com.vn on March 20.
The country
imported nearly 67,000 head of cattle last year, a 19-fold surge compared to
3,500 in 2012. This year to date, Vietnam has imported 40,000 cattle.
Vietnam is to
import more cattle for meat from Australia because supplies from Southeast
Asia are slowing down while the demand for beef is on the rise.
A delegation of
government officials and enterprises led by Australian Northern Territory
Minister for Industry Willem Westra Van Holthe has paid a visit to Haiphong’s
and HCMC’s farming areas and slaughterhouses this month, the commission said.
Van Holthe was quoted as saying that the fast growing demand in Vietnam has
stabilized export prices of cattle in the northern and southern regions.
First shipments of
buffaloes from Australia to Vietnam are considered a promising beginning for
the sustainable farming Down Under and help create more jobs for the local
people in northern Australia, he said.
However, concerning
600 Australian buffaloes expected to arrive in Vietnam in late February and
early March, local veterinary officials said none of the cattle importers
have registered quarantine for the shipment.
In accordance with
regulations, they have to register for quarantine seven days ahead of
delivery to Vietnam.
Amway pours
extra US$25 million into new facility
Amway Vietnam Co.,
Ltd last Friday started work on its second factory in Vietnam at a total cost
of over US$25 million, raising its investment capital here in the country to
US$33 million.
The new facility will
go up at Vietnam-Singapore II Industrial Park in Tan Uyen District in the
southern province of Binh Duong. It will cover a total of 54,675 square
meters, seven times larger than Amway’s first facility in Amata Industrial
Park in neighboring Dong Nai Province.
Set for operation
early next year, the plant will have three production lines having a combined
capacity of 23,280 products, equivalent to US$200 million per year, and
create jobs for over 170 locals.
According to Amway
Vietnam, the project is divided into two phases with modern equipment and
machinery meeting international standards. The first phase, expected to be up
and running in next year’s first quarter, will focus on producing Nutrilite
food supplement powder and pellets with a majority of materials imported from
the U.S.
In the second
phase, which is expected to go into operation in 2017, the plant will produce
liquid products.
Doug DeVos,
President of Amway, said that since it came to Vietnam in 2008, the firm has
achieved steady growth here in Vietnam. This is why Amway has decided to
continue its long-term investment pledge in Vietnam by building the second
plant to meet the increasing demand of consumers, he added.
The construction of
the second plant in Vietnam is part of Amway’s broader plan to export
products made by Amway Vietnam to Southeast Asian countries in the near
future.
Amway Vietnam
reported sales revenues of over US$90 million last year and now has over
300,000 direct distributors.
According to Amway,
which is known for its direct selling model, the firm has been in Vietnam for
only five years but the Vietnamese market ranks 12th among over 100 countries
and territories where Amway is present. With the new plant, Amway hopes
Vietnam will become one of its top ten markets in 2016.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Năm, 27 tháng 3, 2014
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