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BUSINESS
IN BRIEF 5/8
The website said
that from June 2013 to April 2014,
Meanwhile, Research
Assistant Tess Marslen revealed in futuredirections.org.au, that demand for
imported beef has increased exponentially in Vietnam due to the expansion of
the Vietnamese middle class.
Marslen also said
that the growing number of supermarkets and the development of meat-oriented
chain restaurants have created a huge opportunity for
The research
assistant also said Vietnamese importers are currently investing in
infrastructure to support the influx of Australian cattle, which are
considered to be superior in quality.
Nguyen Dang Vang,
president of the Vietnam Husbandry Association told local media that the
increasing import of Australian beef was because beef providers in
In addition,
Australian beef has also received better and more convenient procedures when
exporting to
Vang said there
were 72,000 Australian heads of cattle imported since the beginning of this
year, predicting it would reach 150,000 by the year-end.
A modernized
fishing boat made of composite materials was inaugurated at a shipyard in the
coastal city of
The composite VND6
billion boat is the result of a cooperation project between Japanese Yanmar
Company and the University of Nha Trang Ship Institute (UNINSHIP) aimed at
raising fishermen’s income and developing the tuna industry in the region.
Yanmar Company will
use the 350cv boat as a model in its training courses, instructing fishermen
on how to exploit tuna following advanced Japanese technology.
The Japanese
company is planning to cooperate with Vietnamese partners to build 180
composite fishing boats for Binh Dinh, Phu Yen and Khanh Hoa provinces.
Online bill
payment garners popularity
The Vietnam
Business Forum magazine quoted a source from the State Bank of
The number of
internet-banking users by the end of 2013 increased 45% as compared to three
years ago, according to Vietnam Banks Association (VNBA). About 90% of banks
are offering internet banking services and half of them are providing mobile
banking.
The number of
enterprises paying through the Internet has increased sharply in the last few
years.
EVN plans to offer
discounts on electricity bills to any person paying bills electronically five
days before it is due to encourage individuals and enterprises to use the
service.
At the beginning of
2014, General Department of Taxation informed that there were 366,000
enterprises declaring taxes via the Internet. They have cooperated with banks
to pay taxes electronically to 15,000 enterprises by the end of this year.
Besides electricity
and tax payments, many enterprises in other fields accept transactions
through internet banking. Remarkably, there are projects where the collection
and managing of tuition fees is done through "SSC school card" and
the e-banking service of HCM City Education and Training Department.
Seeing great
potential in the market, many large banks like Vietcombank, Techcombank,
VPBank, ACB and Tienphongbank have diversified their services. VPBank has
concentrated on developing internet banking since 2009 and chosen it as their
major business.
The bank has
completed a range of functions for "VPBank online" service and
coordinated with enterprises in fields of electricity, water and insurance
along with aviation and consumption.
At the same time,
it has also developed high class facilities like giving deposits online to
enjoy attractive interest rates and collecting iCash to obtain gifts.
VPBank has also
participated in a system of the first nine banks to provide inter-bank
super-express money transfer of Smartlink that helps customers transfer money
immediately with high limit and at low costs.
For enterprises
alone, VPBank has signed up with customs, taxation and treasury bodies to
implement services for collecting money for the State budget, and
guaranteeing taxes for import-export goods electronically.
A mega support
industry event with three exhibitions is slated to be held in
Two exhibitions,
Metalex
The number of
registered exhibitors is expected to increase by 20 percent over last year's
shows, with many national pavilions including
The other
exhibition "Business Alliance for Supporting Industry 2014",
organised by the Japan External Trade Organisation (JETRO) in HCM City and
the HCM City Investment and Trade Promotion Centre, will enable Vietnamese
parts producers to meet with Japanese producers to seek business
opportunities.
To take place at
the Saigon Exhibition and Convention Centre from October 9-11, visitors will
also be able to gain new knowledge and networking opportunities through
seminars and other activities during the three shows.
The ASEAN Economic
Community, which is set to come into existence next year, brings both
opportunities and challenges for Vietnamese producers, said Duangdej
Yuaikwarmdee, Deputy Managing Director of Reed Tradex.
To remain
competitive, local companies must invest in modern technologies, he said.
Prospects
for boosting seafood exports
Over the past seven
months, the nation’s seafood export turnover has skyrocketed 24.5% to US$4.2
billion on-year with the
Not only carving
out a niche in key export markets, Vietnamese seafood has established a solid
foothold in the global export market, further evidenced by higher average
annual growth rates than most other markets.
In recent years,
the seafood industry has made every effort to improve the quality of aquatic
products towards gradually shifting from price competition to compete in
quality.
According to the
Vietnam Association of Seafood Exporters and Processors (VASEP), shrimp
product has a dominant role to play in stimulating seafood exports Especially
white-leg shrimp exports to the US and the RoK have posted double even treble
digit growth.
In the first half
of this year alone, white-leg shrimp exports rose 133% to US$1.06 billion,
bringing total shrimp export revenues to nearly US$1.8 billion (up 62%),
accounting for 49.5% of seafood export value. Meanwhile, shrimp output
doubled from last year’s same period in which white leg shrimp output soared
by 400%.
Ministry of
Agriculture and Rural Development (MARD) Directorate of Fisheries Deputy Head
Nguyen Huy Dien has attributed the good performance of shrimp exports to
stable raw material sources and efforts to keep epidemics under control.
Prawns are still a
dominant export item of
In addition to
shrimp, squid, octopus, crabs and other crustaceans also are experiencing
relatively high growth (14-21%) thanks to growing import demand.
On the market
structure, the
Besides, the EU
continues to be the second largest market for Vietnamese seafood imports,
constituting nearly 18% of total export turnover. According to VASEP,
Along with black
tiger shrimp, white leg shrimp exports have increased dramatically in the EU
market, making
The
The RoK is also
With the higher
growth of Vietnamese seafood products in tandem with growing global market
demand, VASEP predicts that seafood exports will pick up in the third quarter
to meet demand for year-end festive months.
Seafood export
turnover is set to reach US$2.1 billion including US$1.2 billion from shrimp,
25% higher than the comparable period last year.
According to
Despite high tuna
catching output, the quality is not up to export standards set by demanding
markets such as the EU,
To deal with this
issue, the MARD will launch pilot projects to exploit, purchase, process and
consume tuna based on value chains in three key tuna production localities-
Binh Dinh, Phu Yen and Khanh Hoa to ensure the quality of tuna products.
In terms of shrimp
breeding,
However, Vietnamese
shrimp exports are facing challenges in the Japanese market after
The Directorate of
Fisheries has worked hand in hand with local inspection agencies to check the
use and trading of substances that are banned for limited by import markets
and provide farmers with recommendations and guidance on how to ensure the
best quality in the breeding process.
Not only the
Japanese market but also many other seafood export markets are imposing new
non-tariff barriers targeting product quality management, particularly in the
breeding, exploiting and processing process.
With strict
regulations on the breeding and processing process stipulated in Decree 36,
Tra fish export products are required to best meet all requirements of the
global marketplaces including the
Accordingly, all
Vietnamese seafood frozen processing facilities must subject to standards and
conditions on food hygiene and safety and have advanced quality management
systems HACCP eligible for exports to all countries from around the world.
In order to better
meet export market demand, the fishery industry has promoted trade promotion
activities and trademarks to achieve greater market penetration for higher
consumption.
From early this
year, VASEP has facilitated business participation in a host of seafood fairs
abroad such as Japan Foodex Fair, Seafood Expo North America (SENA), and
Busan International Seafood & Fisheries Expo with the aiming of promoting
Vietnamese seafood to the global market.
In addition, the
fishery sector has negotiated with foreign partners on the signing of
memorandums of understanding on cooperation between agencies to settle
commercial disputes or remove trade barriers and facilitate export promotion
activities.
PM proposes
reviewing Vinalines’ case
The Prime Minister
has asked the Chief Judge of the Supreme Court to deal with a proposal from
State-run shipping corporation Vinalines in accordance with applicable legal
and regulatory requirements.
In a recent
document sent to the Government Office, Vinaline said the ruling
made by the Vietnam International Arbitration Centre (VIAC) on
December 28 was unlawful, violating the Law on Arbitration and causing
serious damage to Vinalines’ legitimate rights.
Earlier, in another
document sent to the Prime Minister and relevant ministries, Vinalines
expressed a desire for early consideration from the
In its ruling early
this year, the VIAC declared that Vinalines had to pay US$3 million for a lot
of 544 piles of the International Van Phong transhipment port project
contracted by a Korean investor before the project was stopped at the request
of the Government.
However, Vinalines
insisted import price of this lot is about VND50 billion. If calculating the
value of 244 piles after verification, they are priced at only VND22 billion
not VND115 billion as the contractor estimated and the arbitrator recognized.
The actual amount
is equivalent to 25% compared to more than VND87 billion the corporation had
advanced to the contractor, it said.
The corporation
affirmed that the VIAC ruling forcing it to pay the contractor the above
amount when the project has not yet been finalized without payment records is
contrary to
A Vinalines
representative on August 2 said that the court has yet to announce a specific
schedule to consider this case while a VIAC source said the case is expected
to be put for trial right this month.
In the staunchly
competitive coffee industry, leading economists forecast
The
Ministry of Agriculture and Rural Development (MARD) reports Vietnamese
coffee exports in the seven months leading up to August jumped 26.9% in
volume and 21.9% in value on-year.
The country shipped
a total of 1.12 million tonnes of coffee beans to foreign markets during the
period grossing US$2.31 billion in revenue at an average sales price of
US$2,043/tonne, 4.84% lower than the previous year’s figure.
Key coffee
importers included
In recent years,
coffee has been one of
Currently,
According to a
recent report on exports by the Ministry of Industry and Trade (MoIT),
Vietnamese coffee has sharpened its competitive edge thanks to favourable
climate conditions, lower-cost production and a bumper coffee crop. However,
product quality remains low due to out-dated harvest technology and poor
processing facilities.
Additionally, Vietnamese
coffee suffers from lack of brand name recognition as local exporters’
marketing skills are still limited and over 90% of coffee products are
essentially raw unprocessed materials with low added value, MARD reports.
With such
disadvantages, Vietnamese coffee’s export price is lower than the world’s
average. Nevertheless, thanks to its firm foothold in the global market,
Economists suggest
Nguyen Thi Thu
Hang, a senior advisor in export evaluation and capacity building for
small-and-medium-sized enterprises, raises her concern over the shrinking
coffee cultivation area as aging coffee trees are becoming prevalent and
irrigation networks stay outdated, she says.
the local coffee
industry should increase product quality by investing more in research,
post-harvest technology, and processing facility. It is also equally
essential to apply sustainable standards for coffee production and supply
high-quality products on request despite low consumption, she says.
Other experts
recommend the industry more effectively control coffee growing areas to avoid
an imbalance between supply and demand. Coffee farmers should also be
required to follow a strict protocol to meet rising requirements of
consumers.
The general
consensus of industry experts is sustainable coffee export growth will only
be achieved if domestic coffee producers, processors and exporters, increase
product quality in line with international standards.
Action
plans to realize industrialization strategy adopted
Prime Minister Nguyen
Tan Dung has approved four action plans to implement
These four plans
include developing the electronics industry, developing the agricultural
machinery industry, developing the agricultural product processing industry,
and developing the environment and energy saving industry.
The country has set
a target of developing the electronics industry with advanced technology,
high labour productivity by 2020 to be able to compete in the regional and
global markets, making major contributions to the national economy and
national industrialization and modernization.
It aims to produce
high added value electronic products of advanced quality standards for
exports and domestic consumption.
By 2020, the
production value of the electronics industry is projected to increase at
least by 20% annually and contribute a minimum of 10% to the total production
value of the industry, being included in the list of the top ten industries
recording the highest growth rate.
To reach this goal,
six strategic issues should be focussed, namely developing support
industries, developing human resources, expanding the domestic market,
attracting investment from the world’s leading electronics businesses,
developing key products and establishing electronics industry clusters.
To encourage
farmers to use agricultural machinery, manufacturers should supply
agricultural machines based on the real needs of farmers. Ministries and
agencies will carry out agricultural machinery support programmes to meet
farmers’ requirements for quality and ensure a healthy agricultural machinery
business environment.
This action plan is
designed to modernize
Agriculture will
constitute 15% of GDP; labour productivity will rise from US$740/person in
2010 to US$2,000/ person in 2020; the rate of workers in the
agro-forestry-fishery sectors will reduce from 49% in 2010 to 30-35% in 2020.
The country will
target towards becoming a high quality agricultural product producer for
exports and domestic consumption and define 3-5 agricultural and fishery
products that can promote the image of Vietnamese trademark. Accordingly,
typical items-rubber, coffee, tea, shrimp and fruit & vegetables-will be
targeted.
The role of
businesses will be enhanced in strengthening production-market connectivity
and insuring their products are certified by VietGap, GlobalGap, and
Rainforest.
The environmental
and saving energy industries are expected to become major industries by 2020
which can meet requirements for environmental pollution treatment and
sustainable energy.
The goal of the
plan will be pivoted on improving incentive mechanisms and policies,
intensifying inspection and supervision to raise awareness and law
enforcement capacity, applying advanced technologies in environmental
remediation and energy saving and encouraging all economic sectors to attract
foreign investment in this field.
Exports to
In the first half
of the year,
Exports of
machinery, tools and spare parts experienced high growth rates.
To boost exports to
Japanese
firms eager to invest in Binh Duong
A delegation from
Provincial People’s
Committee Chairman Le Thanh Cung said the province had decided to solicit the
assistance of Japanese foreign investors to improve technology and product
quality and sharpen competition in the domestic market.
Cung added the
provincial leaders have always strived to timely remove difficulties for
foreign investors, and create the most favourable conditions for them to
develop production effectively and efficiently.
Professor Umehara
Katsuhiko from the Akita International University Centre for
“Binh Duong has
made tremendous progress and is on the path to becoming a modern and
industrialized city in the near future, he said adding, “
Professor Katsuhiko
said he will introduce
For his part, Vice
Chairman Cung said Binh Duong has 2,317 foreign-invested projects capitalised
at US$19.834 million from 39 nations and territories around the globe.
In addition, the
province has received support from
Can Tho will take
the leadership role in coordinating a drive by Mekong Delta provinces to
forge new overseas export markets, laying a productive foundation for future
thriving economic expansion.
Can Tho Investment,
Trade and Tourism Promotion Centre Director Nguyen Khanh Tung made the
comment at a seminar on August 1, discussing plans for economic development
of the Mekong Delta region.
The provinces of
Ben Tre, Can Tho and Kien Giang are making final preparations to attend an
international trade fair entitled Accenta in
The provinces are
also finalising plans to participate in conducting a market survey in the
cosmopolitan metropolis of
Meanwhile,
southernmost Ca Mau province will join Seafood
Kien Giang province
is attending an international autumn tourism exhibition in
The region’s export
turnover in the first seven months of the year reached US$6.4 billion, up
significantly, 233 million over the same period last year.
Meanwhile, the
Local
exporters keen on Chilean market
A seminar was held
in southern Dong Nai province on August 1 to shed light on specific aspects
of the Vietnam-Chile free trade agreement (FTA) and discuss opportunities to
boost exports in the Chilean market.
Speaking at the
seminar, Chilean Vice Ambassador to Vietnam Alvaro Guzmán said his country is
seeking opportunities for partnering with Vietnamese businesses in
agriculture, garment and textiles, footwear, food, tropical fruits,
handicrafts, and consumer products.
He emphasised that
The Vietnam-Chile
FTA, which took effect as of January 2014, has created a wealth of
opportunity for local businesses to promote exports to the Chilean market and
tariffs have gradually been reduced to 0% on most Vietnamese exports.
Ngo Van Phong, a
senior official from the Ministry of Industry and Trade, in turn said tax
reduction and exemption after the two countries’ FTA came into effect have
helped Vietnamese goods raise their competitiveness.
This is also an
excellent opportunity to attract foreign investors to
Phong suggested
local exporters study contents of the bilateral FTA carefully before
attempting to penetrate the Chilean market. It is also essential to increase
exchange with Chilean businesses and those from third countries to thoroughly
grasp market information, he said.
According to the
Vietnam-Chile FTA, both sides will remove tariff barriers for more than 9,000
products subject to different roadmaps, and offer many investment
incentives to service areas over the next three years.
The agreement,
however, has many important regulations on market access, rules of origin,
quarantine, technical barriers, cooperation, and technical defence that must
be complied with and carefully studied.
Two-way trade
between
For the first-half
of the year, Vietnamese export revenues from Brazil surged 33.3% to hit
a record US$732.6 million, while its imports from the country edged up
slightly by 2.2% to US$542.5 million.
Bilateral trade
surged despite the fact that overall trade exchange between
Statistics from the
ministry also showed that last year’s two-way trade hit US$2.33 billion in
2013, solidifying the South American country’s position as
Outstanding
livestock businesses to be honoured
The forthcoming
International Feed, Livestock and Meat Processing Show (Vietstock 2014) will
honour outstanding businesses for actively taking part in the development of
husbandry industry, particularly the livestock value chain in
The information was
announced by Hoang Thanh Van, head of the husbandry department under the
Ministry of Agriculture and Rural Development, at a press conference in
Fourteen awards
will be presented to the best-performing livestock enterprises in cattle and
poultry farming, animal feed production and milk processing according to
M.Gandhi, Managing Director of UBM ASEAN Company, the event’s organiser.
Themed
“Restructuring the Livestock Industry for Sustainable Development”, the expo
expects to draw over 250 domestic and foreign businesses showcasing the
latest products, technologies and equipment in the field.
A number of
workshops highlighting opportunities and challenges for the husbandry sector
when the Trans-Pacific Partnership (TPP) agreement is signed as well as
cattle health and nutrition will shape part of the event.
The expo, the 7th
of its kind, will take place on October 15-17 in
Rice export
price stands high
In late July, 5%
broken rice was selling at a record high of US$460-470 per tonne while 25%
broken rice hit US$405-410 per tonne.
According to the
Vietnam Food Association (VFA),
VFA attributed the
uptick in the sales price of rice directly to increased demand in the
To cope with the
new movement, the VFA decided to raise the ceiling export price to US$410 per
tonne for 25% broken rice as from July 28, US$45 higher than previous level
applied as from July 2013.
RoK-invested
mobile phone equipment plant inaugurated
The
Covering 2.3 ha in
Vinh Yen city’s Khai Quang industrial zone, the factory is designed to
produce around 4.8 million tonnes of pieces per month.
At present, the
company is providing stable jobs for 500 workers.
In the first half
of this year, Vinh Phuc was among top localities nationwide in attracting
foreign direct investment (FDI), with 18 projects worth 182.1 million USD.
Most FDI projects
in the province are in support and hi-tech industries.
Dak Nong:
aluminum plant asked to be complete by year end
Investors and
contractors of the Nhan Co Aluminum project in the Central Highlands of Dak
Nong have been asked to put the plant into trial operation by the end of
2014.
The request was
made on July 31 by a working mission of the steering committee for the
implementation of bauxite plants in
According to the
project management board, to date over 12 trillion VND (564 million USD) has
been poured into facilities, accounting for 73 percent of the total
investment (16.8 trillion VND). However, the progress is one and a half years
slower than schedule.
All imported
equipment and over 80 percent of locally-made ones have been transported to
the project site for installation.
Head of the
ministry’s Heavy Industries Department Nguyen Manh Quan acknowledged efforts
of the Vietnam National Coal and Mineral Industries Group (Vinacomin) - the
project’s investor - as well as the local authorities in the implementation
of the project. He asked investors and contractors to mobilise all resources
to complete the project on time.
Nhan Co Aluminum
Plant is the largest bauxite project in the Central Highland region. It is
designed to produce 650,000 tonnes of aluminum a year in the initial period,
using advanced and environmentally-friendly technology.
The plant is
expected to boost economic restructuring and socio-economic development of
Dak Nong and the whole region.
Rising rice
prices thrill
The recent rice
export contracts won by some companies forced rice prices up in late July and
made the market in the Cuu Long (
Tran Van Het, a
farmer in
Paddy/rice markets
are reportedly bustling in areas near towns and cities like Can Tho, Dong
Thap, Tien Giang, and Long An. A trader said the recent rice export deals
signed by traders and their purchase of large volumes of paddy/rice also for
border trade with
But experts reject
the latter claim, saying the border trade is not large enough to have much
impact on rice prices in the
They attribute the
rising prices solely to the many rice export contracts signed recently.
According to
figures from the Viet Nam Food Association (VFA), in 2014 exports have been
over 3.34 million tonnes for around US$1.5 billion.
In the delta, dried
normal paddy on July 28 sold at VND5,750-5,850 per kilogramme, up VND300 from
early July, and long-grain varieties for VND6,000-6,100, up VND700 from two
months ago.
This is in contrast
with past years when prices of summer-autumn paddy dropped during harvest,
enabling exporters to buy paddy/rice to execute their export contracts.
The VFA said some
local companies have signed contracts to export to the
Exporters who have
to buy rice now are set for major losses.
Experts forecast
Now a number of
farmers in An Giang, Long An, and Dong Thap say they are "storing up
paddy to wait for higher prices."
Dong Nai
pulls plug on 8 delayed foreign projects
In the first seven
months of the year,
Mai Van Nhon,
deputy head of the province's industrial parks management, said despite
favourable conditions and support from authorities, the projects had been
delayed for 12 months.
Work on many of
them never started while official agencies were unable to contact the
investors of some others, he said.
Due to financial
problems, the joint-venture NippoVina failed to begin construction in Bien
Hoa IP No 1. The land allotted to it was being used as a parking lot and
workshop and tax authorities had not been informed about it.
Kyung Rim Vina in
Dinh Quan IP faced a similar situation. In May 2014 the investor returned the
land to the authorities and informed them about the suspension of plans, Nhon
said.
Last year Dong Nai
had cancelled 17 FDI licences.
Authorities are
also considering revocation of licences issued to more delayed projects.
"We have a list of 47 delayed projects," Nhon told weekly newspaper
Vietnam Iinvestment Review.
Many of them had
failed to contribute to the province's socio-economic development and pay
employees' salaries and social insurance premiums, he said.
"Dong Nai aims
to attract FDI projects that can contribute to its coffers and create
jobs."
Provincial
authorities were determined to scrap the delayed projects and created a more
liberal investment environment and more favourable conditions for foreign
investors, he said.
In the second
quarter, the central city welcomed 177,616 foreigners, representing a slight
fall of 2 per cent.
However, compared
to the first half of last year foreign arrivals were up by 17 per cent as was
the number of domestic tourists, according to a report from CBRE Viet Nam.
The
Korean Air has
increased its frequency from four flights a week last year to seven now, and
a direct service between
Direct flights from
Duong Thuy Dung,
associate director, head of research and consulting department at CBRE Viet
Nam, said positive signals in international flight routes promised a rise in
international arrivals that could make up for the loss of Chinese visitors.
"To some
extent, losing Chinese guests in recent months will be an opportunity for the
In terms of supply,
since 2011 four-star hotels has seen the fastest growth rate of all segments.
By the second quarter of this year four-star room supply had increased by
four times since 2011 to surpass the five-star segment.
The rapid
development of the city in recent years has helped this segment dominate the
market. However, in the near future beachfront hotels will come to lead the
market.
In 2014 and 2015,
an expected 1,698 new beachfront hotel rooms will hit the market compared to
652 city hotel rooms. Most of these will be in three- and four-star hotels.
There will also be new rooms in five-star hotels, but due to the longer
construction process these will not be ready until 2016 or 2017.
Fund offers
housing loans to needy
The municipal
Housing Development Fund yesterday said that it had disbursed VND610 billion
($29 million) to over 1,900 low and middle income earners after 10 years of
operation.
In addition, the
fund has also provided loans for nine housing projects in the city. More than
4,800 households were given loans to repair and upgrade their houses with
total of VND71 billion ($3.3 million).
The fund was asked
to increase the lending level from the current VND400 million to each
household to make it easier for people to access loans.
Transport Minister
Dinh La Thang has met
Congestion at the
port is already said to be hindering export and import business.
At the meeting, it
was decided to reduce the long line-up of goods containers by diverting some
of the container ships to alternative destinations in the vicinity of Cat
Lai.
One operator,
Nguyen Ngoc Quynh, deputy general of Sai Gon Premier Container Terminal, said
her company could handle an additional of eight or 10 shipping vessels per
week.
Deputy general of
The port, now
running under capacity, has appeared less attractive to shippers since it
costs an extra VND2-3 million (up to $US140) to ship a 40ft container through
the port.
Sai Gon Newport
Corporation, which operates
Inbound traffic
using the port for transit will be blocked until any congestion subsides.
The port will stop
taking containers from surrounding ports in
The meeting was
told that the delay of goods and extra storage payments at
According to Sai
Gon Newport Corporation, the severe congestion at the port was caused by
container vessels arriving and leaving later than expected.
Customs authorities
have also begun applying new e-customs clearance procedures and the
Government has tightened control over the loading of trucks nationwide.
The Ministry of
Transport will work with the Ministry of Industry and Trade, the Ministry of
Finance, and local authorities in southern provinces early this month to
ensure congestion is relieved.
Land rights
office to launch soon
The Ministry of
Natural Resources and Environment is rushing to complete the legal framework
for the launch of the one-shop registration office for land use rights
nationwide by the end of 2015.
According to the
ministry, the office would be an important step in land management. The model
would be necessary and needed to be implemented in all provinces.
The pilot project
was carried out in four provinces including Dong Nai, Hai Phong,
Banks hold
more risk funds
Some commercial
banks had more risk provision funds than before to secure the banking system
and fight bad debts, State Bank of
According to Thoi
Bao Kinh Doanh (Business Times), An Binh Bank's Q2 financial report showed
that the bank raised the sum for risk funds in H1 this year by 10 times to
VND107.64 billion (US$5.1 million) from VND11.54 billion ($540,340) in H1
last year.
The larger risk
funds trimmed An Binh's pre-tax profit in H1 by 80 per cent to VND170.35
billion ($7.997 million) from VND214.36 billion ($10.06 million) in the same
period last year.
Vietcombank, one of
the country's largest four banks by assets, spent merely half of pre-tax
profit, equivalent to VND2.4 trillion ($108.6 million), to build risk
provision funds in the first six months of this year.
VIB transferred 75
per cent of pre-tax profit, or VND447 billion ($21 million), to risk funds in
H1.
"If banks
insist on credit growth by any means without proper risk provisioning, they
will have both bigger profit figures and higher risks at the same time,"
said VIB's general director Han Ngoc Vu.
Market observers
said that although several banks spent more on risk provisioning, they could
not precisely describe the system. However, these moves indicated an
increasing attention of credit institutions to ongoing bad debt problems.
The bad debt ratio
in Vietnamese commercial banks rose in the first half of the year to 4.84 per
cent by late June 2014 from 3.61 per cent by late 2013. The SBV reported last
week that total bad debts stood at VND240 trillion ($11.3 billion).
Experts said that
the motivation behind the banks moving toward risk provisioning was to get
themselves more prepared ahead the official implementation of new debt
regulations in Circular No 09/2014/TT-NHNN by the central bank.
The circular on the
classification of bank assets, setting up of risk provisions, and use of
provisions against credit risks forces an increase in risk provisioning. The
document allowed banks to continue restructuring existing loans and keep them
in the same debt group until April 1, 2015 instead of reclassifying them
using more rigorous standards by June 1, 2014 as planned previously.
In
While the
Government, the State Bank of
The central bank in
the document No 5342/NHNN-TTGSNH dated July 24 urged the Credit Information
Centre (CIC), corporate rating agencies, and internal creditworthiness bodies
at credit institutions to build up a comprehensive and consistent
creditworthiness assessment system.
The SBV said that a
better creditworthiness rating system will simplify paperwork of loan
applications and improve the capacity of lending enterprises without assets
as collaterals. The move was made keeping in mind
Investor caution
keeps trades low
Shares ended lower
with sluggish trading on both national stock exchanges last week as investors
displayed a cautious psychology due to their receiving mixed information.
The VN-Index on the
HCM City Stock Exchange lost an accumulative 1.04 per cent to end Friday's
session at 593.9 points, while the HNX-Index on the capital city's bourse
dropped 0.52 per cent to 79.01 points.
Both bourses
witnessed falling liquidity reaching alarmingly low levels, according to
VietstockFinance, with trading volume by matching having declined 17.4 per
cent over the previous week, to 361.2 million shares on the southern bourse
and 15.1 per cent, to a modest 174.7 million shares on the northern exchange.
An average 76.9
million shares were traded per session, at an average trading value of
VND1.39 trillion (US$65.5 million) on the HCM City Stock Exchange,
respectively 17 per cent and 12 per cent lower than the previous week.
The average trading
value on the Ha Noi Stock Exchange fell by 25 per cent to VND421 billion
($19.8 million) on the exchange, at an average 36.3 million shares per day.
Also, large-cap
stocks largely affected the benchmark indices' gains or losses last week.
The market showed
little reaction to recent petrol price cuts, opening last week with losses
after a sell-off occurred on a large scale before rebounding on Tuesday.
Stock analysts said
the gains on Tuesday were only a technical rebound, as the benchmark indices
were mainly reliant on blue chip stocks to post gains and trading remained
sluggish during the session.
Additionally, the
news that Moody's raised
Also, foreign
investors finished as net buyers of VND92 billion ($4.4 million) on both
bourses last week, if the net selling of VND475 billion ($22.4 million) of
Vingroup (VIC) was excluded.
On the HCM City
Stock Exchange, foreign investors bought into Hoa Phat Group (HPG), Sacom
Investment and Development Corporation (SAM), World Mobile Investment
Corporation (MWG), PetroVietnam Drilling Corporation (PVD), Bao Viet Holdings
(BVH) and PetroVietnam Gas Corporation (GAS), while selling VIC and Masan
Group (MSN).
Many stock analysts
provided negative technical views of the market this week, saying that the
benchmark indices might continue to fall.
Ban Viet Securities
noted that both benchmark indices would challenge 580 points and 77.5 points
this week, warning investors to reduce buying activities while lowering the
holdings of stocks in their portfolios.
According to Bao
Viet Securities, technically, the market rebound was of a low possibility,
saying that the market might encounter losses or end flat this week,
regardless of gains from blue chips.
Stocks would
continue to be divided by corporate earnings to be released during this week.
However, the impacts would not be huge, according to Tran Duc Anh, a stock
analyst from Bao Viet Securities.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Hai, 4 tháng 8, 2014
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