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BUSINESS
IN BRIEF 3/8
BKAV wins
award for customer service
The internet
security BKAV company was honoured as one of the top 10 "Good Vietnamese
products – Perfect Service". Others included VietinBank and BIDV.
The listing was
organised by the Viet Nam Standards and Consumers Association. It was based
on a nationwide customer research over a six-month period. Criteria included
quality, competitiveness and environmentally-friendly products and services.
BKAV is well-known
for its anti-virus software that sells for VND299,000 (US$14). It has 17
million users throughout
In 2013, BKAV was
included by Gartner, an American information technology research and advisory
firm, as one of the "Coolest Vendors in Emerging Markets".
Long An
seeks to build racecourse
The People's
Committee of the southern
If allowed, the
racecourse will be developed in Duc Hoa District by the Hong Phat Real Estate
Joint Stock Company. It will have an investment capital of US$160 million,
cover an area of 324 hectares, and accommodate 30,000 people.
The committee said
that the sport and entertainment complex is suitable to the local master plan
for socio-economic development. It is expected to create more jobs and
increase State budget revenues for the province.
HQC sets
firms for private placement
Hoang Quan
Consulting Trading Service Real Estate Corporation (HQC) announced it has
selected three strategic investors, all domestic construction companies, for
a sale of 50 million shares.
The property
developer plans to issue 110 million shares to raise its charter capital to
VND2 trillion (US$95 million) this year, of which 50 million will be offered
to strategic investors in a private placement at the face value of VND10,000
($0.48) a share.
Bao Linh Housing
Development&Construction Investment Joint Stock Company will be offered 10
million shares, while both Indochina Real Estate Development Investment
Company Limited and Binh Thuan Construction and House Trading Joint Stock
Company will buy 20 million shares each.
The placement will
be carried out in the next three months and HQC expects to raise VND500
billion ($24 million) from this issue.
As shares are
issued at par value, transfer will be restricted to one year.
In addition, the
company will issue 30 million shares to its existing shareholders at the
price of VND10,000 per share. Proceeds of these two issues will be put into
four apartment construction projects in
HQC shares are
being traded below par value. The shares hit the ceiling price yesterday at
VND7,900 ($0.38) per share.
HQC posted a net
profit of just VND6.5 billion ($308,000) in the first half of this year, only
half of the same period last year. This number is far below the yearly
after-tax profit target of VND150 billion ($7.1 million).
Fewer firms
established than last year
Nearly 42,400
enterprises were established in the country in the first seven months of the
year, down 7 per cent in the number of new businesses as compared to 2013.
Data from the
Ministry of Planning and Investment, however, showed that with total
registered capital of VND262.4 trillion (US$12.33 billion), the figures were
up 17.8 per cent as compared with the same period last year.
Last month alone,
the number of newly established enterprises went over 5,000 with total
registered capital of VND31.5 trillion ($1.5 billion), reducing 16.5 per cent
against the previous month.
The average
registered capital per newly established business was VND6.19 billion
($290,930), representing 26.7 per cent year-on-year increase. More than
629,000 labourers are expected to earn employment at the new companies,
increasing 6.5 per cent against last year.
The period also saw
37,612 enterprises dissolved and suspending operations, representing an
increase of 9.8 per cent against the previous year. Of this, 5,610
enterprises were dissolved while 6,774 businesses temporarily halted
operations with registration. The remaining 25,228 ceased their operations in
wait for payment of enterprise code or without registration.
Total registered
capital of those in difficulties which are bound to stop operations reached
VND291.6 trillion ($13.7 billion), accounting for 84.5 per cent of the total
capital supplemented during the period.
As many as 9,428
businesses have resumed operations in seven months, decreasing by 6.4 per
cent against the same period last year.
FPT to
create rail e-ticket system
Vietnam Railways
(VNR) and the Corporation for Financing and Promoting Technology Corporation
(FPT) signed a contract for an electronic booking system for VNR in Ha Noi
yesterday.
The US$9.3-million
project will be completed in three stages over a period of seven years.
In the first stage,
FPT will install the electronic booking system within 120 days of the date of
signing of the agreement.
In the second
stage, electronic tickets will be sold on the website for a year to serve the
demands for Tet (Lunar New Year) holiday 2015, starting from November 21 of
this year.
In the final stage,
the system will be installed at all stations in the country over six years,
starting from November 21, 2015.
According to VNR
CEO Tran Ngoc Thanh, the electronic booking system aims to improve the
quality of service and provide passengers with flexible adjustment of ticket
prices depending on the route and duration of the journey, and increase the
demand for railway transportation.
The system provides
customers with all information about trains and publishes the availability of
tickets, especially on holidays and special occasions.
The online tickets
can be purchased anytime and anywhere, through various means including
messages, emails, electronic boards, smartphones and tablets.
Commuters can use
domestic and international credit cards to make their payments.
The system also
calculates the number of bookings and passengers, and helps VNR develop
appropriate business tactics to meet the demand and improve the business
efficiency and quality of available railway infrastructure.
The contract says
that VNR is capable of using the electronic booking system to sell tickets.
FPT is responsible
for establishing the system and will make profit from a part of the ticket
sales that will be given by VNR.
"The
electronic booking system helps passengers to buy tickets easily with only a
smartphone or a tablet. This is also an essential improvement for VNR to
regain its position in the national transportation system," CEO Tran
Ngoc Thanh said.
"The
co-operation between VNR and FPT will make a significant improvement by
applying information technology to VNR's operations, raise its efficiency and
credibility among customers, and support the company to make a great
contribution to the development of the country," FPT chairman Truong Gia
Binh said.
Speaking at a
meeting with the HCM City EPZ Authority (HEPZA) on Wednesday, Le Hoang Quan,
the People's Committee chairman, urged IP and EPZ developers to provide
better services to investors and connect their tenants with Government
agencies to be more competitive.
Local and foreign
firms should better connect with each other to make their products better
known and foster development of supporting industries, he said.
He hailed HEPZA's
efforts to attract investments this year and, especially, to ensure security
in mid-May when many of their tenants were attacked by rioters following
Speaking at the
meeting, Nguyen Bach Hoang Phung, deputy head of HEPZA, said this year the
city's EPZs and IPs have attracted investments of US$333.47 million, a 55.5
per cent increase over the same period last year.
Phung said
development of infrastructure at EPZs and IPs has "a positive
impact" on investments, especially from foreign sources.
In the first half
of this year nearly 69.5ha of land in EPZs and IPs was leased out, a 4.5-fold
increase year-on-year.
Also during the
period 36,711sq.m of factory and warehouse space was leased, mainly at Cat
Lai IP and Tan Thuan EPZ, a 76.27 per cent rise, he added.
Shoe,
leather firms encouraged to be more competitive
Exports of the
country's leather and footwear sector have long depended upon foreign direct
investment (FDI) businesses, as 77 per cent of the total export value came
from foreign enterprises.
Phan Thi Thanh
Xuan, general secretary of the Viet Nam Leather and Footwear Association
(Lefaso) told news portal ndh.vn that domestic leather and footwear firms
have mainly manufactured for exports.
Competitive labour
costs have attracted FDI inflows, as well as orders from
Xuan said it could
not be denied that contributions from the FDI sector promoted export growth
in the industry and provided jobs for labourers.
Local firms have
received management experiences, modernising technologies and deeply joining
in the value chain.
However, she said
the significant presence of FDI companies in footwear exports reflected the
low level of competition exhibited by domestic businesses.
The sector should
put in place effective and long-term solutions to balance the portion of
exports between Vietnamese and FDI enterprises, as the FDI sector has an
advantage in capital, experience and technology.
In addition, these
businesses have markets they supply throughout the world.
Diep Thanh Kiet,
the association's vice chairman, was reported as saying by the newspaper that
another reason for the situation was the limited support industry in the
sector, noting that the industry supplies only 30 per cent of its needed raw
materials, while spending US$1.1-1.5 billion each year for imports of leather
for production.
Kiet said local
producers should be more active in supplying materials, while setting
strategies and studies to meet consumers' tastes, thus increasing the value
of exported products.
Phan Chi Dung, head
of the Ministry of Industry and Trade's Light Industry Department, said
commercial agreements have strict regulations about the origin of products.
Dung proposed that
localities should provide favourable conditions for the footwear industry to
build concentrated industrial parks and become involved in supplying
materials.
Lefaso's figures
revealed that the leather and footwear sector has always had high growth
rates, with export values at the top of the processing group.
In the first half
of the year, the sector earned $6.09 billion from exports, of which shoes
reached $4.84 billion, increasing 22 per cent, and the value of exported bags
was $1.25 billion, posting a 38 per cent year-on-year increase.
It added that the
target of export revenues of $12 billion this year would be possible.
Gold loans
fall as prices dip
Gold loans at 10
commercial banks in
Each tael equals
1.2 troy ounces.
Thoi bao Ngan hang
(The Banking Times) reported that the volume of gold loans may require more
attempts to encourage clients to convert gold into Vietnamese dong, which the
State Bank of
In principle, the
central bank ordered commercial banks to close accounts of deposit and loans
on gold on June 30th, 2013. However, it was not bankers who could make that
decision. Terms of gold loan contracts were quite long and clients often did
not want to end contracts before their maturity.
To wipe the slate
clean, banks offered to exempt charges for overdue interest payment for
clients who borrowed gold at 5 to 7 per cent yearly in 7 to 10 years.
However, banks
reported that such a solution was not working out since a large number of
clients were jewellery processing firms and real estate developers. They were
supposed to pour capital into projects and ran out of money to pay the loans.
A representative of
an
Local gold
yesterday dipped by 0.2 per cent to set at a one-month low between VND36.56
and 36.68 million (US$1,724-1,730) per tael.
The loss was driven
by a decline in world gold prices to below $1,300 per ounce, as investors
nervously awaited the end of US Federal Reserve's two-day policy meeting
yesterday to see if the central bank would raise interest rates faster than
expected.
Spot gold was down
0.4 per cent at $1,299.10 an ounce after rising to as high as $1,312.10
earlier in the day.
Banks quoted the US
dollar between VND21,195 and 21,270, up VND5 to 10 against Tuesday.
Wood export
value rises, but so do costs
According to the
Ministry of Agriculture and Rural Development, exported wooden products were
valued at US$3.35 billion during the first seven months of this year.
Further, during the
first six months, exports of wood and wooden products increased in most
export markets, excluding
Meanwhile, exports
to the
The
Nguyen Manh Dung,
head of the Processing Division from the Department of Processing and Trading
Agricultural, Forestry, Seafood Products and Salt, said
Additionally, in
the first seven months of 2014, the ministry said,
Many experts have
said, if the country is to create sustainable development, the industry must
have modern technology to use in production and increase the efficiency of
using material wood products, while meeting the demands of both local and
foreign markets.
According to the
Trade Office of Viet Nam in the
Further,
In first five
months of this year,
Nguyen Thi Hong
Thuy, commercial counselor of the Viet Nam Trade Office in the
Some large
companies in the
Thuy said
Vietnamese wooden products should increase their market share in the
Local firms should
join international fairs and exhibitions for wooden products in the
Workshop
looks into ways to improve
The Central
Institute of Economic Management (CIEM) on July 31 held a workshop on the
implementation of the Government’s Resolution 19/2014/NQCP on improving
The function was
organised in coordination with the Governance for Inclusive Growth programme
of the US Agency for International Development (USAID/GIG).
Resolution
19/2014/NQCP, issued on March 18, 2014, targets key competitiveness indices
of
To translate the
document into action, State agencies need to cut down administrative
procedures and business expenses so as to improve cross-border trade,
taxation and access to electricity.
At the workshop,
relevant agencies, including the General Department of Taxation, the General
Department of Vietnam Customs, the Vietnam Social Insurance and the Vietnam
Electricity Group, pledged every effort to raise the three indices from now
to 2015.
Deputy Minister of
Finance Do Hoang Anh Tuan said his ministry is amending some circulars so
that the procedure handling duration complies with international accounting
standards.
He said the
on-going tax declaration change can help cut the tax payment duration down by
201 hours.
CIEM Director
Nguyen Dinh Cung said CIEM is working with the business circle to devise
measures addressing challenges regarding business environment and
competitiveness.
With the help of
USAID/GIG, the institute will carry out action plans to facilitate foreign
investment and the growth of small- and medium-sized enterprises, he added.
The Hanoi People’s
Committee and the municipal Labour Federation on July 31 honoured 150 local
enterprises for their remarkable business and production achievements as well
as their active contributions to social work.
More than 200
individuals also received certificates of merit in recognition of initiatives
and creative ideas they contributed to their units.
Ha Thanh Concrete
Joint Stock Co., the Military Petrochemical Joint Stock Co. and the
Korea-Vietnam Co. Ltd were among the most outstanding units.
Meanwhile,
pharmacist Le Thi Binh, Chairman and CEO of the Tam Binh Pharmaceutical Co.,
Ltd, and Pham Van Kiem, Chairman and CEO of the Thai Binh Joint Stock
Corporation, were the best names in the pack of outstanding entrepreneurs.
Addressing the
event, Chairman of Hanoi People’s Committee Nguyen The Thao asked agencies
and sectors to focus on removing difficulties for enterprises and create
favourable conditions for them to access capital sources and expand market.
He also urged
enterprises to promote the application of scientific advance and latest
technologies in production in order to increase productivity and product
quality, thus improving their competitiveness in the world market.
Binh Duong
sees high industrial production, export growths
The industrial
production value of southern Binh Duong province in the first seven months of
this year hit 98 trillion VND (4.6 billion USD), up 12.8 percent year on
year.
Of the figure, the
foreign-invested sector made up 67.5 percent, a rise of 13 percent.
In July alone, the
figure was nearly 14.6 trillion VND (685.73 million USD), a 3.9 percent
growth over the previous month, of which the foreign-invested sector
contributed 9.97 trillion VND (468.59 million USD), up 4.4 percent.
Meanwhile, Binh
Duong posted an export turnover of 1.3 million USD in the month, up 4.4
percent against the previous month, pushing the January-July figure to over 8
billion USD, rising 13.3 percent.
According to a
recent survey by the provincial Department of Statistics, almost all 387
asked local enterprises asserted the locality’s favourable business
environment in 2014 with production recovery in most businesses.
In 2014, 72.3
percent of the local enterprises forecast they will enjoy revenue growths,
while 76.2 percent expect to see a rise in pre-tax profits, according to the
survey.
It also revealed
that 45.7 percent of enterprises will increase labour force while 42.8
percent plan to increase capital.
At the same time,
48.3 percent of 108 export firms expect to enjoy higher export turnover than
that of 2013, it added.-
Tay Ninh
sees booming border trade with Cambodia
Cross-border trade
between
Of the total,
Main exports
included instant noodle, plastic products, detergent, batteries, cooking oil,
cosmetics, construction materials, pigs and chickens, while major import
items were cassava, soybean, buffaloes, cows and material cashew nuts.
Notably, in the
last seven months,
Meanwhile, total
trade in the period at 20 markets in 16 border communes was estimated at
about 200 billion VND (more than 9.5 million USD).
In order to create
favourable condition for border trade activities, the province has invested
in upgrading the road and bridge at the Tan Nam (Tay Ninh)-Mean Cheay (Prey
Veng,
The province is
also drafting a 1 trillion VND (47 million USD) project to build and upgrade
road systems leading to auxiliary border gates in a bid to boost border
trade.
Sustainable
solutions for sugarcane industry
According to
calculations, the cost of sugarcane production in
If a timely and
effective solution is not found, thousands of households and businesses in
the sector will be miserable, said Nguyen Trong Thua, Head of
Agro-forestry-fisheries and Salt production Department under the Ministry of
Agriculture and Rural Development.
According to
Chairman of the Vietnam Sugarcane Association Nguyen Van Loc, there are now
more than 310,000 hectares of sugarcane. From 2009 - 2010 crop year to
present, the country's sugarcane output has increased steadily, reaching an
average of 200,000 tonnes per year.
Particularly in
2013 – 2014 crop year, sugar production reached the record of 1.6 million
tonnes. In this crop, sugar productivity reached the highest level ever of
5.47 tonnes a hectare.
Loc said that the
sugarcane cultivation areas are scatter while technology for manufacturing
process is very poor. Besides these, manual harvesting and transport which
have not followed proper technique has led to the loss of 10-15 percent of
the sugar, while the loss percentage in other countries has accounted for
only 1-2 percent.
Loc added that
comparing competitive advantage in this industry between
According to Loc,
the issue of development plan of
One important
reason is that existing sugar processing technology in
As an expert, Prof.
Dr. Vo Tong Xuan said that to cut the production cost,
In addition,
farmers and businesses need to calculate when applying science and technology
in choosing sugarcane breed for stable development of the sugarcane
cultivation areas.
G-bond
market remains attractive
The Government bond
market is expected to be more active this year as investors have shown
increasingly strong interest in bond auctions despite falling coupons.
At an auction of
the State Treasury on Tuesday, investors bid for VND20 trillion worth of
G-bonds compared to VND8 trillion put up for sale, marking the biggest
bidding volume ever.
At the close of the
bidding, investors snapped up VND1 trillion of two-year bonds, VND2 trillion
of three-year bonds, VND3 trillion of five-year bonds and VND2 trillion of
10-year bonds. Despite a strong decline in coupons of tenors of five years or
shorter, banks were still strongly interested in the debt paper.
According to the
Hanoi Stock Exchange (HNX), the organizer of G-bond auctions, the winning
coupon of two-year bonds was 5.25% per annum, dropping by 0.12 percentage
point against the previous session on July 11.
Meanwhile,
three-year bonds reported a winning coupon of 5.68% per annum, or 0.11
percentage point lower than on July 17. The winning coupons for five and
10-year tenors were 6.68% and 8.48% per annum respectively.
Since early this
year, the State Treasury has mobilized VND139.6 trillion from G-bond sales,
exceeding the total in all of 2013.
As Moody’s suddenly
upgraded
The State Treasury
estimates to launch VND50 trillion worth of treasury bills and bonds onto the
market in the third quarter, higher than the VND47 trillion in the second
quarter but lower than the VND75 trillion in the first quarter.
Three- and
five-year bonds will make up the largest ratio of the third quarter bond
volume, followed by one year, two years and 10 years.
Experts from Bao
Viet Securities Company said that there is a shift from short to long tenors
in this quarter.
The volume of
two-year bonds issued has dropped repeatedly since early this year from
VND17.6 trillion in the first quarter to VND9.5 trillion in the second
quarter and an estimated VND6 trillion in the third quarter. Meanwhile,
five-year bond issues are expected to bounce back strongly.
The move suggests
that banks, which are active on the bond market, will improve their capital
structure by raising their medium-term capital ratio, the experts said.
July retail
growth slows despite multiple promotions
A report by the
General Statistics Office showed that the retail market has grown slowly this
month though retailers have launched numerous promotion programs to fuel
consumption.
The GSO put total
retail sales of goods and services in July at VND238.7 trillion, up a mere
0.3% over the
previous month.
Goods revenues inched up only 0.3% while sales of catering and accommodation
services rose by 3%.
On the contrary,
travel service revenues dropped by 3.8% as the summer holiday season is
coming to an end, with tourism revenues of the coastal localities like Binh
Dinh, Phu Yen, Haiphong, Danang and Ha Tinh falling by 5.2%, 3.2%, 2.7%, 1.9%
and 55.1% respectively.
Accumulated sales
of goods and services in January-July reached around VND1,655 trillion, up
11.4% year-on-year and rising only 6.3% if price factors are excluded.
Despite the good
growth in the first seven months of this year, representatives of
supermarkets and commercial centers said consumption has not improved much
though they have offered a range of promotions and discounts.
Some modern
retailers like supermarket chains said their sales growth resulted mainly
from their expanding networks. In fact, the revenue of each supermarket and
store did not rise or even declined.
Retailers
attributed the situation to economic difficulties which have eaten into
incomes of consumers and forced them to tighten their spending. Consumers
still focus on buying essential goods for their families.
Sales would not
improve next month as August is the seventh month of the lunar calendar when
consumers are advised not to buy stuff in a month of wandering souls.
A recent report of
Nielsen on global consumer confidence and spending indicated that the
confidence index of Vietnamese consumers in quarter two fell slightly by one
point against the first quarter to 98 points as they were more concerned
about finance and jobs in the next 12 months.
Vietnamese
consumers, according to the report, are trying to cut their spending on
clothes and entertainment services to save money.
The Vietnam
Airlines Corporation gained total revenue of nearly VND28 trillion (US$1.32
billion) for the first half of this year, according corporation report
released on July 31.
In H1, the domestic
economy continued to recover, interest rates for loans remained low and
inflation was controlled, while
Vietnam Airlines,
the national flag carrier and also subsidiary of the corporation, registered
revenue of VND27.8 trillion (US$1.31 billion) in reviewed period, or 48.5% of
the carrier's target for this year, it said.
The corporation
expected to gain VND100 billion (US$4.72 million) in pre-tax profits,
including VND82.3 billion (US$3.88 million) from Vietnam Airlines.
The corporation
ferried around 8 million passengers, 8.5% higher than the same period last
year, including about five million local passengers.
However, it
continued facing many challenges in the first half of this year that affected
its operations and business. These included difficulties in the domestic
economy, fierce competition from the domestic and foreign markets, adverse impact
of the conflict on the
To meet the target
set for 2014, the corporation will continue its restructuring plans, ensure
security, safety and proper management of flights and improve quality of
service for passengers.
FDI flows
to processing, manufacturing industries
Processing and
manufacturing industries have attracted the most foreign direct investment
(FDI) capital so far this year, with 448 newly-licensed projects and a new
registered and additional capital of 6.66 billion USD, accounting for about
70 percent of the total FDI.
They were followed
by the real estate and construction sectors, with 1.13 billion USD and 547
million USD, respectively.
According to the
Ministry of Planning and Investment's Foreign Investment Agency, total
registered capital of FDI projects in the first seven months this year
decreased by 20 percent year-on-year to 9.53 billion USD.
In the reviewed
period, as many as 889 new FDI projects were licensed with total registered
capital of 6.85 billion USD, representing 0.9 percent year-on-year decrease.
About 300 projects increased their investment by 2.67 billion USD, falling 46
percent compared to a year earlier.
The
Northern Bac Ninh
province led the country in FDI attraction with 1.33 billion USD, making up
14 percent of the country's total inflow.
Some big FDI
projects that were granted licences in July included the RoK investor's
Samsung Display Company in
In the period, the
country’s FDI disbursement increased by 2.3 percent against the same period
last year to 6.8 billion USD.
The export value of
the FDI sector (including crude oil) hit 55.83 billion USD, up 15 percent
year-on-year and making up 66.8 percent of the total export turnover.
Vietnam
Railways Corporation undergoes restructuring
A number of
subsidiaries of the Vietnam Railways Corporation are being equitised,
including two major companies, Hanoi Railway Passenger Transport and Saigon
Railway Passenger Transport.
The two companies
will be renamed Hanoi Railway Transport Company and Saigon Railway Transport
Company. Restructuring of these two companies is expected to be complete in
2015.
Di An Railway
Company, Gia Lam Railway Company and about 20 others that specialise in
railway infrastructure maintenance will also be equitised by the end of 2015.
All the affected firms will go into operations on January 1, 2016.
Executives at
Vietnam Railways Corporation have ordered further research on the process and
proposed reducing stakes in their consulting and construction companies to
less than 30%.
The Vietnam
Railways Corporation will submit an organisation, management and operational
plan for the national railway system to the prime minister and the Ministry
of Transport in July.
A new report has
shown that many enterprises are optimistic about
Locally-owned
Vietnam Report has conducted a survey of over 300 of
“The figures show
that most enterprises are confident in their performance and economic
outlook. They are also expecting significant business recovery this year,”
noted the survey.
According to the
results, priorities for this year included customer care (65.6 per cent),
human resources development (60.7 per cent), upgrading technology (50.8 per
cent), local and overseas market expansion (45.9 per cent), and research and
development (41 per cent).
In late January
US-backed global management consulting firm Boston Consulting Group reported
that the middle and affluent class in
Tibor Novakm,
country manager and chief representative of Hungarian-backed pharmaceutical
firm Gedeon Richter’s representative office in
“Vietnamese people
are spending more on medicine and we are researching the market. If it meets
our conditions, we might consider building a factory here,” he said.
The Vietnamese
pharmaceutical market was valued at $3.34 billion this year, up from $2.94
billion in 2012.
Anuvat Chalermchai,
brand director of
In this year’s
first quarter, SCG Vietnam earned revenue of $133 million, impressively up 76
per cent on-year. This year SCG will market several new products and
technologies in
SCG’s latest
innovations seen for first time in Vietnam include SCG Smartwood Modeena
Series - “Style your wall unique”, which makes your walls distinctive as it
embraces multiple layers within the same plank. SCG Smartboard Modeena Series
is ideal for creating big dimensions for walls unlike any other wood
substitute.
András Somos, CEO
of Hungary’s consulting firm SKC-Consulting also told VIR he was quite upbeat
about business opportunities for SKC in
Fears rise
as credit flow slows to a trickle
Experts have
expressed concerns over the continued slowdown in total credit flow since the
end of June.
Total credit growth
as of July 18 marked a new low of just 3 per cent while growth for the year’s
first half increased just 3.52 per cent against the figure for the end of
2013.
The Hanoi
Statistics Office estimated July’s outstanding loans equalled VND927 trillion
($44 billion), down 2 per cent against the year-end of 2013. The figure for
the first half of 2014 was announced at VND967 trillion ($46 billion) – a
rise of 2.4 per cent in comparison with the 2013’s year-end figure.
“Credit growth in
July will be much lower than the previous month,” said a local bank leader
who declined to be named.
Nguyen Hoang Minh,
deputy director of State Bank of Vietnam (SBV) branch in
Minh revealed that
the city’s credit volume rose 2.84 per cent in the first half. About 40 per
cent of the $0.74 billion contracted with 700 businesses was successfully
disbursed within June and July.
The fast downward
trend in credit growth has been blamed on weak market demand and supposed
‘adjustments’ by banks in their released figures.
“The economy is
still facing a lot of challenges, ranging from weak demand to modest
capital-absorption capacity, leaving credit growth at a low level,” said Vo
Tan Hoang – Saigon Commercial Bank’s general director.
Under data
published by the Ho Chi Minh and Hanoi Statistics Offices, the consumer price
index (CPI) in July rose only 0.12 per cent and 0.18 per cent month-on month,
respectively.
An anonymous deputy
director of a bank also suggested massaged figures weren’t uncommon in the
banking sector. “Banks often provide more positive figures for their
first-half reports, the real figures might not be so positive…the rebalance
in July could account for the downward trend,” he added.
According to
another financial expert, part of the reason for a slowdown in credit growth
might stem from interbank transactions, which only offers improvement to the
bank’s individual results, not the sector’s actual growth.
“In fact, the SBV
had announced an on-year fall of 2 per cent in the whole fund balance, with
this first half figure at only VND18 trillion ($0.86 billion),” said the
expert.
SBV Governor Nguyen
Van Binh earlier admitted that the year-end target of 12-14 per cent growth
would be a major challenge for the sector. He added, however, that there was
an official determination to achieve at least 10 per cent growth.
SBV urges
banks to boost lending
The State Bank of
Vietnam (SBV) has told local banks, foreign bank branches and rating agencies
to improve their capacity of assessing creditworthiness so as to boost loans
without collateral.
In Document No.
5342 recently released, SBV urges local banks to adopt solutions to help
enterprises gain easier access to more capital to spur production. The
document is aimed at realizing the Government’s Directive No. 11 on solving
difficulties faced by the corporate sector and promoting production and
business development, according to Vietnamplus.vn.
Banks are told to
actively approach companies in need of capital, support them in finalizing
loan applications and expand lending to major projects in priority sectors.
Priority sectors include agriculture and rural areas, exports, small and
medium enterprises, and supporting industries.
The central bank
also asks corporate rating agencies and internal creditworthiness bodies at
credit institutions to build a comprehensive and consistent creditworthiness
assessment system, thus simplifying paperwork for loan application processing
and boosting lending to enterprises without assets used as collateral.
Besides, banks must
speed up restructuring of their finance leasing firms by helping them improve
governance and extend loans to enterprises.
The central bank
reported the overall credit growth in the first six months was only 2.3%. The
banking system now has five more months to achieve 12% credit growth as
targeted.
In Directive No. 11
issued in May, Prime Minister Nguyen Tan Dung noted that enterprises are
facing many difficulties and challenges. Therefore, the Government told
ministries and local authorities to create mechanisms for close and effective
coordination among State agencies, further step up administrative reforms,
especially those in the fields of market entry, import and export, access to
capital and credit, tax, land, investment, construction, natural resources,
environment and labor. The moves aim to create the most favorable climate for
enterprises.
Dragon
fruit has greater chance of going abroad
The Plant
Protection Department is cooperating with local scientists in a study on
sterilizing male flies which harm the dragon fruit.
Male flies will be
irradiated in laboratories before being released into the environment, which
make them infertile, meaning they could not reproduce offspring when mating
with female ones.
To ensure the
success of the method, scientists will make a calculation on the number of
male flies living in the environment in order to release a greater amount of
infertile male flies to compete with natural ones.
Le Duc Khanh, head
of the Division of Entomology under the Plant Protection Department, said
that the method helps prevent dragon fruit from melon fly disease without
using insecticide.
In 2013, only 2,600
tons of 400,000 tons of dragon fruit were exported to the
Vinafruit said a
kilo of dragon fruit exported to those selective markets is paid several
times higher than to
For instance,
dragon fruit must be irradiated before delivery to the U.S or must undergo
heat treatment before being shipped to
Up to 90% of dragon
fruit harvested in
According to
Vinafruit, to diversify export markets of dragon fruit, melon fly disease
must be eliminated. Therefore, local farmers expect the new method from
scientists would help the fruit go to more markets.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Bảy, 2 tháng 8, 2014
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