BUSINESS IN BRIEF 28/8 EVN banned from investment in real estate The Government has issued regulations on financial management of Vietnam Electricity (EVN), banning the group from making financial contribution to stock, banking, insurance, investment funds, real estate and finance. EVN workers examine safety of the electric power transmission system (Photo: SGGP) The largest power company in the country must abide by this regulation except special cases decided by the Prime Minister. EVN investment in other fields must be in accordance with the law; ensure effectiveness, conservation and development of capital; increase revenue; and not change its goal of operation. The group is entitled to mobilize capital from domestic and oversea individuals and organizations, and take full responsibilities for effectiveness of the capital use and payment of the debts together with interest. Capital mobilization must ensure that the debt to equity ratio not exceed three times. EVN can mobilize dormant capital from subsidiary companies which EVN holds 100 percent chartered capital. In case the group holds less, it must reach an agreement from the companies. EU remains Vietnam’s largest export market The European Union EU) is currently the second largest trade partner and the number one export market of Vietnam, said European Commission (EC) President Jose Manuel Durao Barroso. The EC President made the remark while meeting with representatives from European businesses, the European Chamber of Commerce in Vietnam (Eurocham), and a number of Consulates General in Ho Chi Minh City on August 26. He noted two-way trade turnover hit more than US$13 billion in the first six months of 2014, up nearly 13% from a year earlier. Key items included garment and textiles, footwear, coffee, seafood, timber products, electronics, and consumer goods. As many as 23 out of 28 EU member countries are investing roughly US$18.4 billion in 1,471 projects in the country. HCM City attracted 538 EU-funded projects with a combined capital investment of US$2.8 billion, Manuel Barroso said. He spoke highly of the EU’s comprehensive cooperation with Vietnam, which he described as a promising market and reliable partner in the region and the world. The EU always strongly supports Vietnam’s development strategy towards building an industrial country by 2020, he underscored. After the meeting, President Manuel Barroso visited the War Remnants Museum, the Municipal Theatre, the Saigon Notre-Dame Basilica, and the Municipal Post Office before meeting with HCM City Mayor Le Hoang Quan later the same day. Peugeot penetrates Danang market French bicycle maker Peugeot officially established its presence in Danang city with the recent opening of a showroom at 272 Phan Chau Trinh street. Velo Chic came hot on the heels of similar showrooms previously debuting in Hanoi, HCM City and Son La last year. The expansion of its presence in Danang this year proves that Peugeot is keen on developing in the central region, said Lionel Bayard, Commercial Director of Cycleurope group. Like other branches in the northern and southern regions, Velo Chic Danang, built in accordance with European standards, offers high quality products at competitive prices. Vu Huu Phuc, who is in charge in Velo Chic’s business activities, affirmed that apart from introducing the Peugeot brand into Vietnam, Velo Chic will bring Vietnamese consumers a variety of options in European bicycle brands such as Gitane, Definitive, Puch, and Bianchi. Cycleurope is one of the Europe’s largest bicycle groups, marketing more than 1 million bicycles each year. Cambodian province increases cooperation with Long An The Cambodian province of Prey Veng and Vietnam’s southern Long An province will enhance cooperation in all fields, including investment, cultural exchange, community health care, as well as in ensuring social order and security for a peaceful border. The agreement was reached at a working session between Dang Van Xuong, Chairman of the Long An provincial People’s Committee and S’bong Sarat, chairman of the Prey Veng provincial Council during the latter’s visit on August 25-26. During the meeting, aimed at bolstering solidarity, friendship and cooperation between the two localities, Sarat highly valued Long An’s economic development, noting agricultural development as an exemplary model for Prey Veng to follow suit. He proposed Long An province continue helping Prey Veng improve farming and veterinary techniques, and increase power supplies to meet local people’s increasing demand along the common border. Sarat also said he hopes that the locality will share experience in education, and community health care with the Vietnamese province. Meanwhile, Long An’s authorities said they are willing to supply rice varieties and vaccines to Prey Veng province. The province has also begun construction on a friendship bridge, Long An-Prey Veng, in Tan Hung district and roads to connect the two provinces. They said they will create the most favourable conditions for local businesses to invest in Prey Veng province. Seafood exports surge 25.4% in eight months Vietnam’s seafood exports jumped 25.4% on-year in the first eight months of the year to US$4.95 billion, tallying in at a record US$679 million for the month of August alone. The Ministry of Agriculture and Rural Development (MARD) reported the US remains the country’s largest seafood consumer, accounting for 22.8% of the total market share and were US$973.84 billion for the period. Vietnamese seafood exports to Japan, the Republic of Korea and China increased by 6.39%, 53.83%, and 27.37%, respectively. Vietnam is also the third largest supplier of seafood to Australia, trailing New Zealand and China. Vietnam’s total seafood export turnover was over 4,000 tonnes in the first eight months of this year, 3.8% more than last year’s same period. Vietnam ranks second in footwear exports to Colombia Vietnam came second in footwear exports to Colombia, earning more than US$78 million in 2013, accounting for 17% of the South American country’s total footwear imports. Despite a sharp decline of 22% in 2013, China remained Colombia’s largest footwear exporter, making up 52% of Colombia’s market share followed by Brazil (8%), Indonesia (7%), and Ecuador (6%). Last year, Colombia’s footwear and accessories imports fell by 10% to US$ 473 million, primarily attributable to the imposition of a 10% tariff on imports. Can Tho aims for int’l-standard farm products The Mekong Delta city of Can Tho is carrying out a project on managing farm produce quality in an effort to increase its supplies of agricultural products satisfying international standards. Under the project, the city has taken a series of measures to help 85 percent of food producers and 80 percent of consumers get true understanding and practice about food safety by 2020. All agro-seafood processing units are expected to apply quality management processes meeting national and global regulations. To achieve the goals, local authorities are stepping up communication campaigns to call on local enterprises and people to abide by international and national laws on food safety, while working to recognise safe products and encourage consumers to use recognised goods. Farm producers, processors, distributors and retailers have been urged to create close links so as to increase business efficiency and product prestige. According to the municipal department for quality management of agro-forestry-seafood production, the city is home to 319 establishments involving in agro-forestry-seafood products. Eighty-four of them have been granted food safety certificates. The companies of Gentraco, Song Hau, Binh An, Minh Tan, Mien Tay were recognised to meet ISO 9001 standard; Can Tho milk factory and the Fruit Republic Can Tho got HACCP certificates; while Song Hau plantation received GbobalGap certificate.- Agro-forestry-fishery exports hike up in eight months Vietnam’s agro-forestry-fishery exports in the first eight months of 2014 climbed 11.9 percent from a year earlier to 20.22 billion USD, said the Ministry of Agriculture and Rural Development (MARD). In August alone, the sector brought home 2.47 billion USD. Over the eight-month period, Vietnam sold 9.49 billion USD worth of farm produce, up 5.7 percent yearly, while earning 4.06 billion USD from forestry products, rising by 12.5 percent. Notably, it saw aquatic export turnover leaping by 25.4 percent in value to 4.95 billion USD. Coffee, pepper, cashew nuts, aquatic products, timber and wood products destined for other countries maintained their growth in both volume and value. In particular, coffee brought home 2.5 billion USD from 1.22 million tonnes, representing respective year-on-year increases of 22.3 percent and 26.8 percent. Timber and wooden products raked in 3.87 billion USD, growing by 12.7 percent. However, observable falls were recorded in the shipment of some commodities, such as rubber (down 9.8 percent in volume and 31.9 percent in value annually), and tea (down 6.9 percent in volume and 1.4 percent in value). The export of rice continued downward trend since the year’s beginning as it dropped 9 percent in volume and 5.3 percent in value during the period. The MARD set a target of earning 28.5 billion USD from agro-forestry-fishery exports this year, a year-on-year rise of 3.63 percent.- Solutions to better attract, manage FDI projects Foreign direct investment (FDI) has brought major economic benefits but new issues have emerged, requiring the Government to introduce new measures to effectively utilise this vital source of capital, the English language version of the Nhan Dan (People) newspaper reported. Experts say that the Government, ministries, agencies and provincial authorities should strengthen their FDI management, to turn FDI into a true lever to boost economic growth, contributing to national industrialisation and modernisation. According to the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment (MPI), as of July 20, Vietnam had 16,813 FDI projects with total registered capital of over 242.4 billion USD, more than half of which had been disbursed. In general, both economic experts and management officials agreed that FDI had brought great economic benefits to Vietnam , as evidenced by the advent of new technology, strong exports, shifting economic structure and creation of jobs. FDI projects also created a spillover effect to draw smaller manufacturers into the production chain, helped Vietnamese companies gain administrative and management experience from foreign enterprises, and enhanced the effectiveness of international economic cooperation and Vietnam ’s position in the international arena. However, former FIA Director PhanHuuThang said that among more than 16,000 FDI projects for over the last 26 years, up to over 13,500 are wholly foreign invested while only a modest 2,860 are joint ventures. Thus, technology transfer is very scarce. Even with high-tech projects, technical employees are restricted to their own areas of the workplace. Another issue is that FDI into agriculture and fish farming accounts for a very small proportion and is declining. In previous years, the ratio was as high as 15 percent but has dropped to just 1-2 percent of total registered capital. According to the MPI, most of FDI projects in Vietnam (about 80 percent) are employing intermediate-level technology. Some even use obsolete technology that consumes excessive energy and is harmful to the environment. Although FDI attraction is growing steadily, the ratio of added value to production value remains low. Director of the Bac Ninh Department of Industry and Trade, Vu Duc Quyet admitted that exports from FDI enterprises based in the province grew strongly, but the trade surplus was still only around 2 billion USD and the ratio of added value fell from 13.3 percent in 2011 to 8 percent in 2013. Quyet explained that the electronics manufacturing sector, which made up 70 percent of Bac Ninh’s FDI, required a strong auxiliary industry while the whole country and Bac Ninh in particular were unable to meet this requirement. For example, the Samsung complex in Vietnam needed 300 providers of spare parts of various sizes so the company had to bring other Korean manufacturers to form a value chain and this was out of the control of Vietnamese authorities. General Director of the Samsung complex in Vietnam , Shim Won Hwan was quoted as saying that if Vietnamese manufacturers could meet Samsung’s requirements, the company was ready to place orders because it was more effective than buying parts abroad. Apparently, there is still a gap and lack of linkage between domestic and FDI enterprises and the FDI sector’s effect on other sectors of the economy is still very limited. Some enterprises poured money into assembly projects with energy-consuming and environmentally harmful equipment and machinery. The source and quality of workers are also knotty problems to foreign investors, with some large projects unable to proceed due to a lack of trained employees. General Director, Shim Won Hwan said frankly that in Vietnam too much importance is placed on formal qualifications, while there is a serious lack of attention on vocational training, which is in contrast with German, Japan and the Republic of Korea. Samsung was struggling to find enough employees for their expansion in Vietnam . The Vietnamese Government should paid more attention to developing support industry and training high-quality human resources. According to the BacNinh Taxation Agency, the majority of FDI enterprises comply fully with tax regulations. However, from recent investigations, the Bac Ninh Taxation Agency discovered that Viet Pacific Clothing Company was engaged in transfer pricing and has collected arrears of 14 billionVND (658,000 USD). Many localities are beginning to adjust their strategies in a bid to remedy shortcomings in the attraction and use of FDI. According to Director of Hai Duong provincial Department of Planning and Investment, Vuong Duc Sang the province has built a list of areas in which the province limits FDI capital, does not encourage FDI or does not provide investment certificates. The province will not allow FDI in a non-manufacturing sector, projects wasting energy and natural resources, projects using backward technology or projects that are likely to pollute the environment, he noted. Meanwhile, Director of Dong Nai provincial Department of Planning and Investment, Bo Ngoc Thu said that the province was making every effort to draw FDI capital in the right direction by facilitating investment in support industries, in 'green' industries and in industrial zones. Regarding transfer pricing of FDI enterprises, General Director of Taxation Department, Bui Van Nam said that management over tax payments from FDI enterprises had been strengthened. From 2013, the Taxation Department ordered tax agencies at all levels to list high-risk enterprises, and to build appropriate plans to inspect and supervise their operations with a focus on tax bill violations, and suspicious banking transactions, among others. The General Director affirmed that 30 percent of the total 20,000 FDI enterprises revealed dubious signs. Since early this year, the taxation sector has inspected nearly 1,000 FDI enterprises that reported losses and had signs of transfer pricing, collecting around 30 trillionVND (1.41 billion USD) in tax arrears. The move has produced an effect on FDI enterprises, with an obvious reduction of enterprises declaring losses. To better manage FDI companies, the taxation sector will concentrate on measures to detect and handle tax bill violations, trade fraud related goods origin, commodities with abnormal revenue, enterprises with high tax arrears and high losses, firms temporarily importing materials for re-exporting and so on. For example, the Department of Industry and Trade of Bac Ninh province required Samsung Group to pledge a profit not less than 2 percent of its total turnover during negotiations before accepting the group's investment in the province. In addition, the province also asked Samsung to invest 0.75 percent of its total revenue in research, development and technology transfer activities. According to Director Thang, Vietnam should clarify its strategy on attracting FDI, including strategic partners such as Intel and Samsung, as now was not the time to attract FDI at all costs. He suggested the State enhance the efficiency of FDI management, complete the legal system and reform administrative procedures, among other measures, to lure foreign investment into targeted areas such as support industries, high-tech sector and agricultural, forestry and fisheries sectors. HCM City extends sales promotion Ho Chi Minh City has quadrupled its annual sales promotion period to four months this year, according to the Department of Industry and Trade (DoIT). Unlike previous years, when it was celebrated only in September, this year it will go on until December. Organised by the DoIT and the Department of Culture, Sports and Tourism, the programme targets boosting sales and attracting a large number of tourists, DoITDeputy DirectorLe Ngoc Dao said. Another change this year is that it will be implemented in all the city's 24 districts rather than just the downtown area. "The programme has got a good response from many businesses," Dao said. More than 1,200 businesses and 2,500 households are expected to join the programme, nearly 40 percent more than last year, according to the DoIT. Saigon Co.op's "Proud of Vietnamese goods" programme would be the highlight of this year's event, Dao said. The supermarket chain's biggest promotion of the year, at a cost of nearly 200 billionVND(9.4 million USD), will involve more than 600 suppliers. There would be discounts of up to 50 percent on more than 3,000 essential products at Co.opmart supermarkets, Co.op Food stores, and Co.opXtraPlus hypermarket between August 23 and September 14, Nguyen Ngoc Hoa, the co-operative's chairman, said. There would also be mobile sales programmes in rural and remote areas and industrial zones, he said. Dao said Saigon Co.op'sprogramme would greatly contribute to the city's sales promotion efforts and stimulate consumption.- Agricultural exports increase by 12 per cent in first eight months Viet Nam has generated US$20.22 billion in revenue from its farming, forestry and seafood exports in the first eight months of 2014. This represents an 11.9 per cent increase from that of the same period last year, with exports in August accounting for $2.47 billion, according to a Vietnam Economics Times newspaper report quoting figures from the Ministry of Agriculture and Rural Development. The figures also revealed a year-on-year increase in the value of exports from the farming sector by 5.7 per cent, to $11.4 billion. The same was true for the fishing sector, which registered a 25.4 per cent year-on-year increase to $4.95 billion, and the forestry sector, which posted a 12.7 per cent year-on-year increase to $3.87 billion. Ministry officials revealed that in the first eight months of the year, the average export price of Vietnamese rice rose by 3.1 per cent to $452.3 per tonne compared with that of the same period last year. But the average export volume of rice fell by nine per cent to 4.44 million tonnes, and the average export value of the commodity likewise fell by 5.3 per cent to $2.01 billion. During the period, Viet Nam experienced a sudden increase, estimated to be 2.8 times more in both volume and value, in its rice exports to the Philippines, making the latter its second largest export market at 23 per cent of total export volume. China is still the largest export market for Vietnamese rice, accounting for 36.18 per cent of total export volume in the first eight months of the year. Ministry officials revealed that rice exports passing through the border to China slowed down in the past two months after the latter tightened its restrictions on rice imports, thereby sparking an increase in the price of the country's rice exports. The Viet Nam Food Association said rice exports to China via large contracts were ongoing since the early part of this year and were expected to reach a total of 1.1 million tonnes. The association predicted the national export volume of rice to reach 1.9 million tonnes in the third quarter, 1.4 million tonnes in the last quarter and 6.3 million tonnes for the entire year, as a result of the high demand for rice exports in the Philippines, Indonesia and Malaysia. The ministry reported that coffee exports in the first eight months gained a year-on-year increase of 26.8 per cent in volume to 1.22 million tonnes and 22.3 per cent in value to $2.53 billion. But the export volume represented only half of that in May, and this was attributed to a low supply of coffee from farmers and enterprises since April. Meanwhile, exports of cashew achieved a year-on-year surge of 13.9 per cent in volume to 188,000 tonnes and 15 per cent in value to $1.22 billion. The US, China and Netherlands remained the three largest cashew export markets for Viet Nam. In the first eight months, pepper exports also jumped by 23.9 per cent in volume to 126,000 tonnes and 38.2 per cent in value to $926 million compared with that of the same period of last year. The four largest export markets for Vietnamese pepper are the US, Singapore, United Arab Emirates and India, accounting for 45.73 per cent of total export value. The exports of seafood products reached $4.95 billion in the first eight months, or 25.4 per cent more than that of the same period of last year. The US remained the largest export market for seafood products, with a total export value at $973.8 million, a 38.6 per cent year-on-year increase. Other large seafood export markets such as Japan, South Korea and China also saw an increase in value for the first eight months, the ministry said. IZs told to protect environment Ha Noi authorities will ban or limit investment in economic and industrial zones that have failed to install waste-water treatment systems, the municipal People's Committee has said. The ban followed a request last month by Deputy Prime Minister Hoang Trung Hai who is concerned about environmental pollution of the surroundings, including water supplies and good farm land.. In a document sent to departments, People's Committee Vice-chairman Nguyen Ngoc Tuan asked the municipal Department of Planning and Investment to work with other agencies to study specific measures and report to the committee. He also asked the Department of Industry and Trade and management boards of industrial and processing zones to tell investors to promptly complete sewage-treatment systems and connect them to factories operating in the zones. Local authorities responsible for industrial zones have also been told to speed up inspection of environmental protection measures. Figures from the Department of Industry and Trade show that as many as 107 industrial clusters are under construction in the province. Of the 42 industrial zones and clusters in operation, only 25 have the required sewerage systems. Ha Noi People's Committee has approved a plan to force all industrial zones to use waste-water treatment systems, including assistance from city funds. The systems will be built at seven industrial clusters this year, and at nine more next year. Petrol import tax to remain unchanged until end of year The Ministry of Finance (MoF) on Monday required petrol distributors and dealers not to revise the import tax on petrol and oil products until the end of this year. The ministry announced in a legal document that the tax on petrol, diesel, mazut and kerosene would remain at 18 per cent, 14 per cent, 16 per cent and 15 per cent respectively. Ngo Huu Loi, General Director of the Taxation Department, said that the tax on petroleum had been stipulated by the Law on Import and Export Tax not to exceed 40 per cent. The ministry had issued a tax frame for petroleum rates on January 19, 2010, when there were changes in the world petroleum prices. The finance ministry said that the current import taxes on petrol and oil products were lower than the regulated amount. Loi said that the import taxes on petrol and petroleum products are a tool for collecting funds for the budget and for regulating the market. The non-revision of the import tax is considered to be a good way of preventing the smuggling of petrol to neighbouring countries, and of enabling the development of domestic petroleum plants and reducing dependence on imported petroleum products. Viet Nam has to import 70 per cent of the petrol and petroleum products required to meet the domestic demand. The retail price of petrol has been reduced thrice in August, amounting to a total cut of VND1,430 per litre, to stand at VND24,210 (US$1.15) per litre. S Korea continues to snap up VN goods Viet Nam has gained US$3.66 billion in revenue from exports to South Korea in the past seven months, representing a modest year-on-year increase of 2.4 per cent. Figures from the General Department of Customs also showed that from January to July 2014, garments took the lead with a $921.7-million turnover, representing a 36.7 per cent increase from that of the same period last year and making up one-fourth of the country's total export earnings from its trade with South Korea. Seafoods placed second with $343.8 million, representing a year-on-year increase of 53 per cent, while wood and wood products placed third with $267.8 million, a year-on-year increase of 47.4 per cent. Other exports likewise experienced signficant growth. Earnings from mobile phone exports increased by 300 per cent, followed by electric cables, 100 per cent; handbags and suitcases, 45 per cent; machinery and spare parts, 40 per cent; and leather and footwear, 29 per cent. Officials of the Vietnamese Trade Office in Korea urged domestic enterprises to exert more effort in accelerating trade promotion, improving production capacities and sharpening competitive skills to further tap into the lucrative South Korean market. They noted that South Korean consumers have been shopping in small and medium-sized supermarkets, hypermarkets and traditional markets. They also preferred environment-friendly food and were paying more attention to the country of origin of their food purchases, giving top priority to Korean-made goods. To successfully penetrate Korean markets, Vietnamese exporters should ensure the quality of their products, with focus on food safety and hygiene, and make their goods look different from those already available in the market, the officials said. Last year, Vietnamese exporters earned $6.6 billion from the South Korean market, representing an 18.9 per cent year-on-year increase that accounted for 24.3 per cent of the total value of exports to the Asian country. Quang Nam attracts Japanese investors The central province of Quang Nam organised a seminar in Japan's capital Tokyo on Monday to lure investment from Japanese businesses, especially small-and medium-sized ones. Vietnamese Ambassador to Japan Doan Xuan Hung said that Quang Nam is a destination for foreign investors as it is located in the central key economic region and boasts rich minerals, abundant labour force, and improved infrastructure. Former Japanese Ambassador to Viet Nam Norio Hattori said that Viet Nam's investment environment has much improved in recent years in terms of investment licence granting and tax preferences. Dong Nai to host Vietnamese goods fair Around 120 local businesses will display their products at a Vietnamese high-quality products fair that opens on Friday this week in Dong Nai Province. The fair, which will run until September 3, will have 300 booths showcasing various kinds of products, including garments and textiles, footwear, handicrafts, food and electrical goods. It also features other activities to introduce innovative achievements of enterprises, as well as art performances and game shows. Special programmes designed for children to welcome the upcoming Full Moon festival will also be held alongside the event, with meaningful gifts to be given to 100 disadvantaged children on September 2. HCM City keeps up rapid economic growth HCM City achieved robust economic growth in the first eight months, creating favourable conditions to fulfill its socio-economic targets for the full year, Chairman of HCM City's People's Committee, Le Hoang Quan, has said. Speaking at a Committee's meeting yesterday, Quan said it provided economic figures for the period. According to a report from HCM City's Department of Planning and Investment, the city's retail sales and services were worth over US$420.7 billion, a 12.7 per cent year-on-year rise. The biggest contributors to growth were household utensils, fuel, and transportation. Exports totalled $18.56 billion, an increase of 2.3 per cent following August shipments of $2.24 billion. Imports jumped 10.8 per cent in August though, at $15.6 billion, the value for the year-to-date fell 9.1 per cent. Major decreases were reported in steel, milk and dairy products, computers, and electronics and components. Imports from China dropped by 7.4 per cent in the first eight months while exports rose by 15.4 per cent. The Industrial Production Index has been rising consistently this year with some major sectors like mechanical engineering, electronics, chemicals-rubber-plastics, and food processing reporting a 7.5 per cent increase year-on-year. The city plans to restructure these industries by focusing on processing and manufacturing and reducing the contribution of mining. So far this year city authorities have issued licences to 241 projects with a total investment of $1.06 billion, a 7.3 per cent decrease in number but an 80.3 per cent jump in value. Chairman Quan lauded the figures, saying they indicated the great efforts made by the authorities and people. But links between the banking system and businesses, especially those taking part in the city's price stabilisation programme, must be strengthened, he said. Banks had unveiled plans to reduce loan interest rates, and this offered an opportunity for companies to boost production, he said. However, credit growth in the city remained low — at about 4.7 per cent against a target of 10-15 per cent – he said. Growth in foreign trade was not as high as expected, he added. Tran Anh Tuan, deputy head of the HCM City Institute for Research and Development, said despite the decrease in import of technology-related products like computers and electronics and components, the big expansion in import of machinery and equipment and chemicals indicated the sectors' low competitiveness. As of 20 August the city had issued licences to 15,071 new businesses, but 14,200 existing ones suspended operations, he said. In the final four months of the year the city should help businesses cope with their challenges by providing financial and technological support, he said. City authorities were expected to introduce more new policies and incentives to help businesses and improve the competitiveness of the city's industries. Maritime Bank lends VND1 tril. to enterprises Maritime Bank has made VND1 trillion preferential loans available for enterprises in Hanoi City in response to a program in which banks and businesses meet to address the latter’s financial needs through the arrangement of local authorities. The bank is expected to give loans to 24 corporate borrowers under the program. Enterprises who take out loans between now and the end of this year will enjoy short-term interest rates of 7-8% per annum and medium-term interest rates of 9-11%. In addition, the bank will provide customers with financial solutions to help them reduce interest payment and optimize the efficiency of capital usage. Last Friday, Maritime Bank inked credit contracts with the first four enterprises selected for the program. Wintek set to increase investment to $2 billion Taiwan’s manufacturer of touch panel and small-to-medium liquid crystal display units Wintek is planning to double its investment capital to expand the production capacity of its factory in Vietnam. Kinh Bac City Development Holdings (KBC), the developer of the Quang Chau Industrial Park, reported that Wintek recently submitted its expansion plan to the Bac Giang Provincial People’s Committee. The Taiwanese manufacturer’s first-phase facility in the park was registered with the total investment capital of 1.12 billion. The expansion project will increase the Wintek manufacturing facility to 100 hectares, from its current 24. During President Truong Tan Sang’s visit to Wintek’s manufacturing facility last week, Hyley H. Huang, chairman of the firm’s management board, reported Wintek Vietnam operations for the last three years and its expansion plan. If the investment is approved, Wintek will raise its total investment capital in Vietnam to more than $2 billion, making it one of the largest electronic firms in the country. The Taiwanese manufacturer decided to raise the investment capital in its Vietnam facility from $250 million to $1.12 billion previously in 2012. At present, the firm is employing up to 10,000 local employees for the manufacture of touch screen units. Jay Huang, spokesperson of Wintek did not respond to VIR’s request for further comment or details of the expansion project’s schedule. However, in the group’s 2013 annual report, Wintek announced that it had been moving labour-intensive processes to its Vietnam plant in response to rising labour costs in China which had negatively affected the company’s overall business performance. Founded in 1990, Wintek’s touchscreen panels and TFT displays are primarily used in mobile phones, tablets, notebook computers, digital cameras, video players and portable navigation devices. Apart from their factory in the Quang Chau Industrial Park in the northern province of Bac Giang, it has two factories in Taiwan, two in China and one in India. The firm also has research and development centres in the US, China and Taiwan. The company’s investment is expected to not only contribute to Bac Giang’s socio-economic development, but also contribute to supporting industries for Vietnam’s electronics sector. Vietnam Rubber Group opens its doors to people affected by plantations in Cambodia and Laos Vietnam’s state-owned rubber giant, Vietnam Rubber Group (VRG), has announced steps to reform how it does business in neighbouring Cambodia and Laos, in response to requests by Global Witness and local groups for the company to respect national laws and citizens’ rights. The new measures mean that communities who are affected by VRG’s plantations can now lodge formal complaints or enquiries with VRG. Previously there was no system that would allow people to interact with the company in this way. “We strongly welcome moves by VRG to improve communication with communities affected by its plantations in Cambodia and Laos,” said Megan MacInnes of Global Witness. “These steps fall short of addressing all of the problems with the company’s plantations, but if properly implemented they could represent an unprecedented move by a rubber company towards delivering justice for citizens whose land and livelihoods have been taken from them.” Rubber is a booming trade in the Mekong region, but is one of the least regulated land-based commodities globally. This legal vacuum is fuelling a land grabbing crisis in Cambodia and Laos that has shown no sign of abating for half a decade. Global Witness’ 2013 Rubber Barons report revealed how VRG and another of Vietnam’s biggest rubber companies, Hoang Anh Gia Lai (HAGL), were striking deals with the Lao and Cambodian governments for huge tracts of land without first gaining permission from the people who lived on it, or compensating them for it. VRG is a significant player in the region. According to company data, its land concessions in Cambodia cover nearly 150,000 hectares – an area almost as large as London or Manila. In Laos the company presides over almost 19,000 hectares. Since the release of Rubber Barons, VRG and its member companies have been piloting a community consultation scheme which has seen a number of communities receive money for farmland or trees lost to the companies’ plantations. VRG is now rolling this scheme out across all of its twenty-one plantations in Cambodia and Laos. The company’s most recent announcement commits it to resolving the issues raised in citizen’s complaints or enquiries, and responding directly within 30 days. Individuals, communities or groups representing them can submit these either in person or via post at VRG’s local offices or at company headquarters in the capitals Phnom Penh and Vientiane. Global Witness will be working with local organisations to monitor and evaluate this system over the next two years. “The test now will be whether communities receive a fair resolution to their complaints. This should include financial compensation as well as alternative livelihoods to those lost as a result of VRG’s operations,” said MacInnes. “These new measures are a step in the right direction but we remain deeply concerned about the continued illegal logging and land clearance taking place in and around VRG’s plantations. We will continue to watch the company closely.” New oilfield located offshore Vietnam Japanese Idemitsu Kosan company on August 21 announced that it has struck oil at its fourth oil-well at plot 05-1b and 05-1c offshore southern Vietnam. The company said the oilfield was first identified through testing carried out in May and August. Idemitsu plans to complete further testing in the near future to identify the full extent of reserves of the new oil field. Two Japanese companies - Idemitsu and JX Nippon – each own 35% of shares in the oil plots while another company – Inpex Corp – holds the remaining 30% interest. Vietnamese-language domain names hit record high The Vietnam Internet Network Information Centre (VNNIC) under the Ministry of Information and Communications on August 25 celebrated the issuance of the 1 millionth Vietnamese domain name. The achievement is attributable to VNNIC’s free registration of domain names in the Vietnamese language, which was first initiated in late April 2011. So far, almost 1.006.306 domains in Vietnamese language have been licensed by VNNIC. According to VNNIC Tran Minh Tan, Deputy Director, domain names in Vietnamese language belong to internationalized Domain Name (IDN). It is used for non English-speaking countries, helping local people use their own languages when accessing theInternet. The Vietnamese-language domain name is aimed at protecting ideas, product names, services and trademarks of Vietnamese enterprises on the global internet. Hanoi hosts Post & Logistics Committee Meeting Trade union leaders from the Asia-Pacific region and the UNI Global Union Asia Pacific Regional Organization (UNI Apro) met in Hanoi on August 25 to prioritise tasks. The annual meeting gave international trade unions the chance to gain a better understanding about Vietnamese trade unions’ activities as well as the country’s land and people, helping enhance people-to-people diplomacy. At the opening ceremony, Vietnam Post’s Trade Union (VPTU) Chairman Bui Van Hoan said his organization became a pro-active member of UNI Apro since 2008. VPTU has implemented a score of measures to support workers and will continue to promote initiatives to improve income and working conditions for themand raise the role of trade unions. Participants discussed issues related to real situation and future of Vietnam Post, privaterisation, liberalisation and commercialisation of post and telecommunication activities, relations between the Universal Postal Union (UPU) and Asian-Pacific Postal Union (APPU) in global post services and new services to protect public postal services. They shared information and experiences in boosting postal services as well as trade union activities in regional countries. Ha Noi to auction sand-mining rights The Ha Noi People's Committee will auction sand-mining rights in the riverbed of the Hong (Red) River in the city's Long Bien District starting in the fourth quarter of this year. The mining area is about 50ha with estimated reserve of 500,000 cubic metres of sand. Expected to add at least VND450 million (US$21,200) to the city's budget, the auction is part of a city plan approved by committee vice chairman Vu Hong Khanh that aims to create a legal base for granting exploitation licences and ensure fair competition among investors. Inadequate management at district, ward and commune levels made illegal sand mining a recurring problem in city rivers. In many cases, local authorities signed land-rent contracts with violators and collected rental fees for years, making it difficult to remove illegal storage sites. Fines for such violations also fail to deter miners. The city's People's Committee said that illegal sand mining could cause landslides and change river flow, in addition to endangering the dyke system. The municipal People's Committee has granted mineral mining licences at 31 sites, of which 16 are operational and 15 are completing land-renting procedures and other relevant documents. Major minerals including stones, sand and peat are being exploited on Hong, Day, Tich and Ca Lo rivers in Soc Son, Me Linh, Dong Anh and Gia Lam districts. Vietnamese tiles falling behind imported products Made-in-Vietnam tiles are in an uphill fight against imports, which have more diverse designs and price scales, consistent quality and better marketing. Most large real estate projects prefer imported products. Hoang Thi Le, head of the material procurement department of a leading real estate firm with two high-rise apartment buildings east of Hanoi said all the tiles used in the building were made in China. Meanwhile, middle-income individual customers are also choosing imported tile for their homes. Most building material shops clustered around Cat Linh, Hoang Quoc Viet, Thanh Nhan and An Trach streets in Hanoi have mainly imported products on display. Many are even recommending that their customers buy imported tiles due to the variety of designs and prices available. “The market looks good for Chinese-made tiles in Vietnam,” said Ly To Linh, director of 6-year-old Ho Chi Minh City-based Chinese tile distributor Van Dat. She added that the firm would continue to focus on distributing imported tiles in the foreseeable future. Quach Huu Thuan, manager of Viglacera Corporation’s subsidiary Viglacera Tien Son (HNX:VIT), said 60 per cent of tile in Vietnam is imported, mostly from China and less so Thailand. Domestic firms such as VIT, Prime, Dong Tam and Taicera have been working on developing new products and improving their quality, but most admit that it is difficult to compete with imported products. As a result, they have been boosting exports. Statistics by Vietnam Building Ceramic Association shows that Vietnam’s annual tile output has surpassed 400 million square metres while domestic demand is only around 350 million.  Prices of small spring onion increased causing farmers excited Traders in the Mekong Delta proposed to buy the vegetable at VND650,000 – 700,000 per quintal (US$30.69-32.98 per quintal) much higher prices fixed in the beginning of the year. Farmer Nguyen Thanh Tung in Vinh Long Province said that flood season in the Mekong Delta caused onion crop loss, hence prices of onion therefore hiked. Some places are submerged; consequently, farmers cannot plant the vegetable, leading to supply is lower than demand, he added. With the price of onion increasing over the past few days, a farmer earns net profit of VND15million (US$707) a 1,000 meter square. Farmers earn much profit from planting onion than other vegetable. Meanwhile price of sweet potatoes in provinces Vinh Long, Dong Thap, Can Tho dropped dramatically. It fell to VND320,000-340,000 per quintal. Farmers in Vinh Long said that it was due to Chinese market shrink. In other side, farmers have seen a crop failure and low sweet potato quality leading to the falling in price. They suffered losses around VND50 million (US$ 1,889) per hectare as selling prices have dropped to throwaway rates. Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR