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BUSINESS
IN BRIEF 9/10
EU warns
The European
Commission's Directorate-General for Health and Consumers (DG SANCO) has
issued a warning to Vietnam fruit and vegetable growers, the Ministry of
Industry and Trade (MoIT)’s European Market Department announced on Oct. 6.
The Department
reported that since Feb. 2, 2014, the DG SANCO has on three occasions,
received information from EU member countries warning about batches of
imported basil and bitter gourd from
Earlier, DG SANCO
officially announced the EU would ban the import of Vietnamese fruit and
vegetable if it finds more Vietnamese batches not in compliance with
phytosanitary regulations during the period from Feb. 1, 2014 to Feb. 1,
2015.
According to the
International Plant Protection Convention (IPPC), wood packing material
should be dried at high temperature to kill harmful organisms and contain a
safety inspection stamp.
The MoIT’s European
Market Department has asked local importers to strictly follow phytosanitary
regulations and meet all requirements for food hygiene and safety provided by
the EU.
Foreign
exchange rate remains unchanged, says SBV
Deputy Governor of
the State Bank of Vietnam (SBV) Nguyen Thi Hong on Oct. 6 affirmed that no
adjustments have been made in the foreign exchange rate at present despite
the price of US dollar is rising during these days.
Though the forex
rate saw an increase on the inter-bank market in early October, it was much
lower than that stipulated by the SBV, Hong said.
She attributed the
rise to rumours about the central bank’s adjustment in the current forex
rate. The foreign currency supply and demand were stable in September,
resulting in a surplus of around US$11 billion in overall payment balance in
the nine-month period.
According to some
other opinions,
However, Hong said
VND liquidity has reduced, while credit growth is resuming, with September
figure hitting 7.26% compared to the end of last year.
She noted that the SBV
will continue monitoring strictly forex rate and implement monetary policy
tools to stabilize the foreign currency market if necessary. The State bank
is willing to sell foreign currency to keep forex rate at a stable level,
Hong added.
HSBC:
The Purchasing
Managers’ Index (PMI) of
The report showed
that
With inventories
reduced, output is expected to expand further in Q4, reflecting a GDP
expansion of 6.0% y-o-y in the last quarter of this year.
September consumer
price index (CPI) dropped further; with oil price subdued and demand pressure
weak, said HSBC, which predicted CPI to end 2014 below 4%.
Inflationary
pressures are benign as food supply is ample, domestic demand is sluggish,
credit growth low, and oil prices weak. In recent years, domestic firms'
trade deficits have narrowed while foreign enterprises' surpluses have picked
up, providing stability for the currency and the economy.
In the medium term,
HSBC believed that labour market, financial, infrastructure and supporting
industry reforms are required for growth to be sustainable. Low linkages with
foreign enterprises and persistent skilled labour shortages are currently
limiting the benefits of FDI, especially regarding the acquisition of
technology.
HSBC said the EU
Vietnam Free Trade Agreement (FTA) will likely conclude by year end, if not
in early 2015, resulting in stronger growth of manufacturing exports. The
expiration of EU anti-dumping measures on Vietnam leather footwear, labour
cost competitiveness with China and anticipation of the Trans Pacific
Partnership have caused firms to shift production to Vietnam.
While manufacturing
is going from strength to strength,
Garment
exports to hit US$25 bln for 2014
Garment and textile
exports are forecast to exceed the yearly plan by 16% and peak at US$25
billion for 2014, according to the Vietnam National Textile and Garment Group
(VINATEX).
In the first nine
months of 2014, garment exports were US$17.2 billion, up 19% over the
corresponding period last year.
Many traditional
markets remained on a high growth trend, such as the
In the first nine
months,
Enhancing
Vietnamese capacity for global trade
Vietnamese
companies have encountered difficulties piercing foreign markets due to lack
of managerial skills and failure to carefully evaluate the market risks, said
Dr. Christiane Beck,
A high-quality due
diligence market analysis is critical to the success of doing business in a
foreign country, Beck said in announcing the launch of a new programme for
small and medium-sized businesses in 15 provinces and cities nationwide.
The programme
funded by the European Trade Policy and Investment Support Project
(EU-MUTRAP) aims to improve managerial skills for Vietnamese businesspersons
and, in particular, their competence in transacting international trade.
Vietnamese
companies have encountered numerous difficulties manoeuvring the
complicated maze of laws and regulations, particularly in the European Union,
noted Dr. Christiane Beck.
She added the
project will focus on developing skills to insure Vietnamese companies
understand the means and methods of how to obtain and analyse market
information to optimally assess market opportunities.
Nguyen Dac Hoan,
Project Manager of DEVIWAS from Germany in turn said by learning how to
properly assess foreign markets local businesses will be able to better plan
and prepare themselves to understand and comply with the requirements of
foreign markets and the business culture of partners.
Vietnamese
companies primarily are suffering from short-sightedness and lack of
long-term strategic planning. In the move to global integration, they
tend to be putting the cart before the horse and are getting ahead of
themselves, said Hoan.
In a nutshell, the
problem is lack of strategic thinking and the failure to lay out sufficiently
detailed short, medium and long-term plans. This has resulted in
Vietnamese businesses turning their businesses into “general stores” and not
zeroing in on their areas of strengths and forging a market niche.
Therefore, businesses
are not developing in a sustainable and stable manner, Hoan said.
Experts from
DEVIWAS caution that faced with fierce competition, Vietnamese businesses,
especially those in short supply of capital resources, experiences,
technologies and human resources should not attempt to compete head on with
the foreign competition.
If Vietnamese
businesses are to be successful then they must establish alliances with
foreign partners and benefit from their experiences via cooperative and joint
venture projects.
Dr. Christiane Beck
echoed the experts from DEVIWAS views, saying said the project’s activities
are aimed at enhancing capacity of Vietnamese businesses to cooperate with
partners from the European Union.
The “European Trade
Policy and Investment Support Project (EU-MUTRAP) is the continuation of 15
years of successful cooperation between the EU and the Ministry of Industry
and Trade in the field of trade related to technical assistance.
The EU-MUTRAP
project supports sustainable international trade and investment in
Vietnam-Japan
enhance connectivity in agriculture
A high-level
delegation from the
Speaking at a press
conference in
He said he is
heading up a 100-member strong delegation of Japanese business
representatives, who have all expressed a strong desire to cooperate with
Vietnamese companies, particularly in agriculture.
On the occasion of
President Truong Tan Sang’s visit to
In May, Governor
Hashimoto said the Vietnam Ministry of Labour, Invalids and Social Affairs
and the Ibaraki Agriculture Association signed an agreement on receiving
Vietnamese apprentices to learn agricultural techniques of
For the past five
consecutive years,
With such
achievements, the Governor expressed his hope to increase future cooperation
with
New
shipping route cuts costs for freight transport
A new coastal
transport route between Quang Binh and Kien Giang province opened on Sunday,
slashing freight rates by up to 75 per cent.
Deputy Minister of
Transport, Nguyen Van Cong, said at the opening ceremony in
He said the Quang
Ninh – Binh Thuan route had not only reduced transportation costs, but had
led to fewer road accidents.
One of the newly
developed coastal routes connects Quang Binh and Binh Thuan (858km), and the
other connects Binh Thuan and Kien Giang (700km).
Only vessels
classified for both river and sea travel are allowed to travel in both new
routes - as long as they do not venture more than 12 nautical miles from the
coast in seas with waves 2.5 metres high or less.
Statistics from the
Viet Nam Maritime Administration (Vinamarine) show that the demand for
waterway transport in coastal provinces is rising because the cost of
shipping goods is much cheaper than by road.
The amount of goods
carried through the Mekong Delta Region is more than 50 million tonnes a year.
Companies in
Since the Quang
Ninh – Quang Binh waterway route opened recently, a large number of companies
have changed from road to water transport.
Vinamarine also
reports that road transport cost for one container from Hai Phong to Thanh
Hoa was between VND10 to 12 million, while water transport cost only VND 2.4
million.
Inflation
holds steady in first nine months
The inflation rate
in
In a report on the
country's economic situation in the first nine months of 2014 which it released
last week, the National Financial Supervisory Commission (NFSC) also said the
consumer price index (CPI) in September remained stable and at the low level
that was maintained in the past two years.
Despite seasonal
factors in the past month, the education services sector increased by 7.1 per
cent, making its CPI surge the highest in the past seven months.
However, inflation
was at its lowest level, increasing by 3.62 per cent year-on-year. With the
downward trend in inflation, the committee forecast the decreasing CPI to
facilitate an interest rate decline.
The payment balance
saw a surplus and stable exchange rate during the nine-month period. As of
September 15, State budget overspending was estimated at VND124.5 trillion
(US$5.9 billion), a 4.7 per cent year-on-year decrease.
The commission also
said exports and imports witnessed a positive growth rate in the period, with
a trade surplus of around $1 billion, accounting for 0.9 per cent of export
turnover.
GDP growth has also
been on an upward trend since the beginning of the year. Growth reached 6.15
per cent in the third quarter, higher than the 5.25 per cent recorded in the
second quarter.
The NFSC predicted
that the country's GDP this year would reach 5.8 per cent because of high
third quarter growth.
However, the
committee said difficulties remained for local businesses. A total of 48,330
companies shut down or suspended operations between January and September,
representing a 13.8-per cent year-on-year increase.
The NFSC attributed
this to the slow improvement in personal consumption and low private
investment. Low demand and bad debts were the two main reasons preventing
private businesses from increasing their investments.
To address these
problems, the committee made five proposals: provide low interest rate
capital for banks to reduce their lending interest rate, use State financial
resources of the Viet Nam Asset Management Company to buy bad debts,
accelerate investment disbursement from the State budget and Government
bonds, improve administrative procedure reforms, and restructure State-owned
enterprises.
Can Tho
posts record $616m trade surplus
This Cuu Long
(Mekong)
During the period,
Can Tho's exports hit $914 million and its imports hit $298 million, the
department said, adding that rice and seafood remained the city's key
exports, bringing a combined turnover of $723 million or 79 per cent of total
export value.
Other exports
include garments and textiles, pharmaceuticals, arts and handicrafts and
footwear, as well as iron and steel, fruits and canned mushrooms. These have
raked in $181 million in profits, a 29-per cent year-on-year increase.
Duong Nghia Hiep,
deputy director of the city trade and industry department, attributed the
performance to the city's efforts to curb imports and produce quality exports
to achieve higher turnover.
Hiep also said the
efforts of domestic companies, especially those into rice and seafood
exports, to improve the quality of their products, seek new markets in Asia,
Africa and the
Earlier, Can Tho
set a target of $1.65 billion in export profits by year-end, including $516.5
million from rice and $488 million from seafood. The goal is $150 million
higher than that of 2013, according to the city trade and industry
department.
Can Tho has trade
relationships with more than 80 countries and territories. Besides the
traditional markets of
The city also aims
to create favourable conditions for small enterprises to promote their goods
in the French market, said Truong Quang Hoai
The committee
organised a working session with representatives from the Business
Association of Vietnamese High-Quality Goods last Thursday to find ways to
help small enterprises producing consumer goods, handicrafts, food and
tourism services to intensify trade ties with French partners.
Vu Kim Hanh, the
association president, said expanding operations to foreign countries,
including
Viet Nam
offer support to Laos
Ninh pushed for
increased negotiations and the signing of a new trade deal, making it easier
to achieve a trade value of US$2 billion by 2015.
Both Deputy PMs
agreed to facilitate visits at all levels in a bid to share experience in
management, socio-economic development and Party-building.
They expressed
their appreciation for the joint preparations for the 37th meeting of their
inter-government committee and the progress made in trade and investment,
with bilateral trade exceeding $1 billion for the first time last year.
Both ministers
highlighted the need to accelerate strategic co-operation projects, including
the erection of a statue of President Ho Chi Minh in
The guest vowed to
do his utmost to foster friendship between the two countries.
Capital
injection needed to cut loan interest rates
The State Bank of
The National
Financial Supervisory Commission (NFSC) made this proposal in its September
economic report, which infonet.vn cited.
SBV figures in
September showed that lending interest for general production and business
remained stable at nine to 10 per cent for short-term loans and 10.5 to 12
per cent for medium- to long-term loans. Meanwhile, deposit interest rates
fell by 0.1 to 0.3 percentage points to five to six per cent for short-term
loans, six to 7.2 per cent for loans of less than 12 months and 7.3 to 7.8
per cent for longer-term loans.
The NFSC backed up
its comments with reports from 15 credit institutions and said the average
profit margin between deposit and lending interest rates in the first half of
this year decreased by 50 per cent year-on-year.
"The growing
imbalance of interest erodes the financial capacity of credit institutions
and the risk provisioning toward bad debts as well," the report said.
The commission also
suggested the volume of low-interest capital that the central bank should
inject.
To date, the
banking system handled more than VND249 trillion (US$11.6 billion) in
non-performing loans (NPLs), compared with VND464 trillion ($21.7 billion) in
bad debt in September 2011. After three years, an estimated 53.6 per cent of
NPLs were resolved.
The Viet Nam Asset
Management Company (VAMC) is expected to purchase VND70 trillion ($3.2
billion) of NPLs by the end of this year, plus VND78 trillion ($3.7 billion)
in provisional funds from commercial banks and credit institutions.
SBV Governor Nguyen
Van Binh told the National Assembly Standing Committee meeting last week that
the central bank would take drastic measures to handle bad debts.
However, in its
latest report, the NFSC said the VMAC was in need of a State-sourced
financial stream to become more competent in purchasing bad debts. Otherwise,
the VMAC will need more time to lengthen tenures of special notes to help
credit institutions accumulate long-term capital sources.
Exchange-traded
fund listed in HCMC
Viet Nam's
exchange-traded fund (ETF), VFMVN30, was officially listed yesterday on the
HCM City Stock Exchange, with about 20.2 million shares valued at more than
VND10,000 (US$0.47) each.
Bao Viet and
The ETF shares,
with a price margin that is within 20 per cent, represent the performance of
the 30 largest stocks in
The ETF's opening
is expected to solve problems related to the foreign ownership of shares, as
it grants unlimited ownership of shares to foreign investors, who are
restricted to only 49 per cent of closed-end funds.
The VFM has
mobilised a registered capital of VND202 billion ($9.6 million) for the
fund's initial public offering, thereby doubling its target of VND100 billion
($4.76 million).
Although the fund's
scale is still much smaller than that of the total assets of two foreign
ETFs, including The Market Vectors Viet Nam ETF and DB X-Tracker FTSE Viet
Nam, its registered capital is $10 million to $7.5 million higher than that
of The Market Vectors's initial start and $5.3 million higher than that of
the FTSE.
Ministry
proposes special tax on online games
The Ministry of
Finance recently submitted a proposal to the Prime Minister about applying a
special 10 per cent consumption tax on online games.
The online
educational games approved by the Ministry of Education and Training are
proposed to be exempt from the tax.
The special tax is
expected to help orient the business and production operations of firms and
enhance the management of online games. The ministry has suggested a 10 per
cent tax to initially help enterprises to manage and take initiatives in
outlining plans for investment, production and business.
It is projected
that the special tax will bring in more than VND650 billion (US$30.9 million)
per year.
Hoa Sen
builds Nghe An steel sheet factory
The Hoa Sen Group
began the construction of a steel sheet factory worth more than VND2.3
trillion, or US$109.52 million, in this central province last Saturday.
The facility,
spread over an area of 12 ha in the Nam Cam Industrial Zone in Nghi Loc
District, is expected to be completed in August 2018, and will create jobs
for about 500 workers when it becomes operational.
The company said
that the factory will help increase its production capacity to meet the
demand for steel products in the northern and central provinces, and increase
its exports to
The Hoa Sen Group
is based in the southern
Ha Noi
targets increased growth
Ha Noi hopes to
develop its economy by 7 to 7.5 per cent annually between 2016 and 2020, said
chairman of the city's People's Committee, Nguyen The Thao, during a recent
interview with Vietnam News Agency.
Thao also said Ha
Noi needed to reduce its poverty rate by 1.5 per cent annually.
He said the
capital, as a leading economic centre, should focus on maintaining economic
stability and controlling inflation that is why it had set targets to help
the nation become industrialised by 2020.
Thao said Ha Noi's
economic growth had historically been high and that it had risen
one-and-a-half times faster than in the rest of the country. In the past
three years, it grew 9.17 per cent.
The rate of
mobilising social capital continued to rise by 16.36 per cent per year. The
city also attracted 2,806 business projects with a total value of US$21.1
billion.
The city had
implemented national programmes providing vocational training and creating
jobs for workers.
Each year, the city
had created jobs for 137,000 labourers, keeping the unemployment rate below
4.8 per cent last year.
Thao also said the
city had helped lift 16,500 to 20,000 households out of poverty. By the end
of last year, there were 59,360 low-income households.
Planning,
infrastructure development and urban management remain high on Ha Noi's list.
The city has expanded many new roads, such as Hoang Quoc Viet, Nguyen Chi
Thanh, Tran Khat Chan and Dai Co Viet.
The city also paid
attention to rural infrastructure. It removed temporary classrooms from
schools. In 2012 and 2013, it installed about 10,000 water treatment machines
in 10,000 low-income households in Thanh Oai, Thuong Tin, Me Linh, Ung Hoa,
Phu Xuyen and My Duc districts.
The Government
carried out 37 projects to mark the 60th anniversary of the city's Liberation
Day. Seven have been completed and 22 others will be concluded by the end of
next year, he said.
Nguyen Van Ha, a
Vietnamese man living in the
"I will invest
in the city," he said. "I will introduce the city to my friends who
are seeking a good place for investing."
But the city's
urban planning and management remain weak, said Bui Xuan Tung, deputy head of
the municipal Department of Planning and Architecture.
Skinny houses posed
a safety threat, so the city should write more regulations on building such
structures, Tung said.
Vietcombank
exceeds annual target during first nine months
The Joint Stock
Commercial Bank for Foreign Trade of Vietnam (Vietcombank) announced that it
has fulfilled 99 percent of its annual target for capital mobilisation with
390 trillion VND (nearly 18.6 billion USD) during the first nine months, up
by 18 percent from the beginning of the year.
The bank’s
outstanding loans increased by 10 percent to 300 trillion VND (14.15 billion
USD) by the end of September compared to the figure in early 2014, indicating
that the bank’s market share improved since last year.
So far, Vietcombank
generated more than 7.5 trillion VND in pretax profit before paying for risk
provision. This accounts for 70 percent of this year’s profit target, up by 8
percent compared to the same period last year.
Chairman of
Vietcombank, Nguyen Hoa Binh, believes this positive development forms a
basis for the bank to fulfill all of its targets this year.
The bank’s General
Director Nghiem Xuan Thanh emphasised the need for Vietcombank to strictly
control bad debt whilst maintaining a high level of credit growth and
accelerating the recovery of off-balance-sheet debt.-
According to the
South West Region’s Steering Committee, the Mekong Delta produced 2.8 million
tonnes of aquatic products during the first nine months of this year, of
which 1.8 million tonnes came from aquaculture.
The output
increased by 140,000 tonnes compared to the same period last year, helping
the region earn more than 3.4 billion USD from aquatic export, up by 19
percent year-on-year.
The provinces of
Kien Giang and Ca Mau produced the most, with a combined 830,000 tonnes.
The provinces
increased their offshore fishing fleet and aquacultural production areas to
800,000ha. The Safe Quality Food 100 (SQF 100), Vietnam Good Agricultural
Practice (VietGAP), and Global GAP models are being applied, enterprises are
encouraged and helped to update technology and train their workers to improve
their skills and to meet the requirement of international markets.
Additionally, water
management, post-harvest, processing, and export activities of aquatic farms
and processing factories have been put under strict management in accordance
with international standards.
Moreover, the
provinces are creating conditions for producers to sell their goods more
efficiently at markets and restaurants in the Mekong Delta region, with 1,500
tonnes of fresh and frozen seafood being traded a day.-
Binh Duong
starts construction on joint venture textile factory
Construction on a
textile factory began in the southern
Funded by
By 2019, the
factory aims to expand its annual capacity to 96 million meters of fabric,
predominantly using made-in-Vietnam materials and technology from
Nearly 90 percent
of products will be exported to the
Over 3,000 local
residents are expected to be employed by the factory.
World Bank
cuts forecast for
Sandeep Mahajan,
head economist at the World Bank Office in
However, in a press
conference held on October 6, Mahajan also said that
Mahajan also said
that the restructuring of state-owned enterprises was going slower than what
the World Bank had expected. However, he showed understanding by saying that
a successful equitisation process has many factors.
Due to the impacts
of economic downturn, investors are reluctant to buy shares, putting more
pressure on enterprises.
According to
Mahajan, Vietnamese authorities should be more active in making information
about the process public. Transparency is another matter that needs to be
worked on if Vietnamese authorities want to speed up the restructuring
process, he said.
He added that
Vientam's economy has two kinds of growth. The first is strong and comes from
FDI and the second, weaker one comes from domestic companies. This, along
with a high trade deficit, has hampered
Outstanding loans
in Vietnamese dong accounted for 83 percent or 839 trillion VND (39.39
billion USD) of the total number of loans, while foreign currencies made up
the remaining 17 percent or 8 billion USD. Short-term loans made up 51
percent of the portfolio.
Loans in priority
sectors, including rural and agricultural development, exports, small and
medium enterprises, auxiliary industries and high-technology applied
enterprises, totalled 136.24 trillion VND (6.4 billion USD), a 7.9-percent
increase over that of the end of 2013.
The city's total
deposits increased by 4.71 percent in the first nine months to reach 1,226
trillion VND (57.55 billion USD). Of these, deposits in dong made up 84.7
percent.
By end-July, the
city's bad debt was estimated to be worth 59 trillion VND (2.76 billion USD),
making up 5.93 percent of total outstanding loans, or a 1.24-percent increase
over that of last December.
Nguyen Van Binh,
the State Bank of Vietnam (SBV) governor, told the National Assembly Standing
Committee last week that bad debts nationwide amounted to eight percent of
total outstanding loans by the end of late July. Binh said he would bring
down the ratio to six percent by year-end.
The country's
credit growth from January to September 2014 reached 7 percent while the
annual target is set at 12 to 14 percent.
The VND
continues to slip against USD
After the sudden
increase of the value of USD against the VND on Oct. 1, it has continued to
rise.
A price survey of
commercial banks Friday morning showed that, since the previous day, the
buying price of USD increased by between VND5 and VND30 and the selling price
of UDS increased up to VND60.
Currently, the
lowest buying price is around VND21,200 and the highest is VND21,290, while
the highest selling price is VND21,340.
At VietinBank, both
the buying and selling prices increased VND30 from the previous day, brought
the exchange rate to VND21,255 - VND21,315.
At BIDV, the
exchange rate VND21,250 - VND21,330. At LienVietPostBank, the exchange
rate is VND21,220 - VND21,340 VND/USD. At Sacombank, the exchange rate is
VND21,230 - VND21,330.
Meanwhile, the
inter-bank exchange rate remained stable at VND21,246.
Over the last few
days, exchange rates have increased by VND75 due to adjustments by the State
Bank of
Bulk buying
of live crocs by Chinese traders hurts
Many crocodile
leather businesses in
Ca Sau Hoa Ca
(Saltwater Crocodile), a well-known
But the company has
been using skins from its reserve stock this year as it is unable to pay
higher prices than the rates Chinese traders are bidding to buy live reptiles
from local farms, company director Ton That Hung told Tuoi Tre (Youth)
newspaper.
In order to
maintain a profit, the leather company can only pay up to VND170,000 (US$8) a
kg for live crocodiles, according to Hung.
But Chinese traders
are willing to buy the animals for up to VND240,000 ($11.3) a kg, he said.
“So the crocodile
farms prefer selling to the Chinese,” he added.
Hung said his
company is able to continue business, though at a smaller scale, thanks to a
reserve stock of skins.
“Smaller businesses
had to shut down since they could not solve the problem,” he said.
This is not the
first time Chinese traders have affected the production of Vietnamese
businesses by buying their crucial raw materials in large quantities. Similar
cases have impacted seafood, mango and coconut processors, and fish sauce makers.
Vietnamese
crocodile leather manufacturers faced the risk of a short supply as early as
two years ago, when Chinese traders began hunting for young crocodiles at
high prices.
“The Chinese bought
as much as 70 to 80 percent of
“So we do not have
enough mature crocodile skin to tan at the moment,” he added.
The best quality
skins are those tanned from crocodiles weighing 15 to 20kg, according to the
insider.
“But we have few
such crocodiles now, as the animals weighing 6 to 8kg were all bought by
Chinese traders in 2012,” he said.
Many crocodile
leather firms have increased their product prices due to the skin shortage,
according to Hung, of the Ca Sau Hoa Ca Co.
“Businesses that
export their products to
Rising
demand for crocodile dishes?
Nguyen Thi Lan, a
trader in the Mekong Delta
In 2012, crocodiles
weighing between 8 and 35kg were sold for only VND150,000 ($7.06) per kg, but
the prices are now up to VND240,000 a kg, Lan said.
“I had received an
order for 40 metric tons of live crocodiles per month, but could only export
11 metric tons, even though I had hunted everywhere for the reptiles,” Lan
said.
“Two years ago it
only took me a week to source enough for the order.”
Lan said there has
been rising demand for dishes made from crocodiles in
The Chinese traders
are also hunting for young crocodiles in
Prices for the
young animals thus rose steeply to VND1 million ($47) a kg, but supply was
behind demand, according to the Dong Thap trader.
“Most of the
crocodiles are raised on small-scale farms in
Vietnam’s Ministry
of Finance has proposed adding online games to the list of goods subject to
special consumption taxes, which currently includes tobacco and liquor
products, a decision that could result in VND650 billion (US$30.59 million)
in tax collection per annum.
The excise tax must
particularly be applied to online games that can cause addiction, and those
with violent content, the finance ministry said in its report to the
government on the amendment of the law on special consumption tax.
The report, based
on the findings of the finance ministry’s study of the Vietnamese online
gaming market, was made after the National Assembly’s Standing Committee
proposed subjecting online games to the excise tax.
In 2013, there were
around 58 businesses, mostly located in
These companies had
a collectively registered capital of VND1.15 trillion ($54.13 million), while
their total revenues were as high as VND7.98 trillion ($375.6 million).
Revenues from the
domestic market alone were VND6.48 trillion ($305 million), according to the
finance ministry.
Online gaming is
thus a lucrative market, and gaming businesses are much healthier than firms
operating in several other service sectors, the ministry concluded, noting
that most of the Vietnamese businesses in the online gaming sector are game
providers, not game makers.
The Ministry of
Information and Communications has licensed 73 games to be distributed in
The unlicensed
games, mostly from foreign game makers, have generated billions of dong worth
of profits from Vietnamese gamers, according to the finance ministry.
The ministry,
however, admitted that it is not easy to tell which games have violent or
banned content.
“There are games
that have educational content, such as helping children to learn English and
math,” the ministry said.
It thus proposed
that educational games, as verified by the Ministry of Education and
Training, be exempted from the excise tax.
The tax rate for
online games must be 10 percent in the initial phase of implementation, which
the finance ministry said is intended to “allow gaming firms to have time to
rearrange their business.”
Taxing online games
is hoped to add more than VND650 billion a year to state coffers, the
ministry said.
Once finalized, the
law on special consumption tax will take effect on July 1, 2015.
ANZ sells
entire stake in securities firm SSI
Banking giant ANZ
is selling its entire 17.51 per cent stake in
ANZ is divesting
its stake in Saigon Securities Inc.
“While Saigon
Securities Inc (SSI) remains a leading securities company in Vietnam and the
partnership has benefited both parties, the sale is consistent with the
group’s super regional strategy which emphasises the growth of ANZ-owned
businesses and its commitment to improving returns in Asia,” Tareq Muhmood,
CEO of ANZ Vietnam, told VIR.
ANZ has been a
shareholder in SSI for seven years. It entered SSI in 2007, buying a 10 per
cent stake at $88 million. ANZ on September 29 stated that it had agreed to
sell its 17.5 per cent stake.
SSI was priced at
VND29,200 per share on September 26 which means the stake was worth around
$85 million by market price.
According to SSI’s
press release issued on September 29 announcing the divestment, ANZ’s
move was in line with the banking group’s strategy to focus 100 per cent of
its capital into commercial banking in
“This is a chance
for foreign investors,” Nguyen Duy Hung, chairman-cum-CEO of SSI, said.
“SSI’s foreign share threshold had been reached since 2011. SSI and many
foreign investors have asked the government for expansion many times since to
no avail. ANZ’s divestment has opened up some room.”
The divestment
would not affect SSI’s development strategy, Hung claimed. “SSI remains
attractive to many other foreign investors,” he said.
A group of domestic
investors have registered to buy the shares from ANZ, including Hung himself,
Duong Mat Troi Investment JSC., whose CEO is Hung’s younger brother, and
Saigon Dan Linh Real Estate Co., Ltd, which is owned by the brother’s family.
The price of SSI
shares has been on a steady uptrend, ending at VND31,700 a share on October 3
up from VND30,700 a share on September 29 when the news was released. SSI was
the biggest brokerage on the Ho Chi Minh Stock Exchange based on market share
of 13.27 per cent during the first three quarters of the year. It earned
audited consolidated net profits of VND456.16 billion ($21.6 million) on
revenue of VND868.64 billion ($41.16 million) in the first half of 2014.
State Bank
leader eases banking sector concerns
State Bank of
Binh’s message was
intended to calm National Assembly members who had earlier asked him to
clarify how the banking system had been restructured.
“The financial
system’s safety has been ensured and controlled. The danger of collapse and
risk in the system has been pushed back. Liquidity has been ensured, with the
state’s assets and the public’s deposits completely safe, even in the weakest
banks,” he stressed.
“Positive
beyond-expectation results in the reform of state-owned and joint stock banks
have been clearly seen,” he added.
According to the
State Bank of Vietnam (SBV), restructuring plans for BIDV and Mekong Housing
Bank would soon be approved.
The SBV had also
approved schemes for Vietcombank and Agribank. Changes will be made to
Agribank’s member council, management and control boards to renew the bank’s
leadership. “This year is expected to see Agribank’s credit growth reach 7-8
per cent, with the focus largely on rural and agricultural development,” Binh
said.
The SBV is also
appraising restructuring plans for financial leasing companies owned by
state-run commercial banks. The SBV will also compile a master plan to raise
the financial capacity of five state-run commercial banks until 2015. This
plan will be submitted to the prime minister soon.
“Equitisation of
state-owned banks has gone well with results exceeding expectations,” Binh
said.
Regarding joint
stock banks, the SBV reported that out of nine banks defined as weak since
2012, eight banks had seen their restructuring schemes approved, with the
remaining bank’s restructuring plans to be submitted to the prime minister in
due course.
“All the approved
plans are being implemented under the close eye of the SBV. So far, five
banks have been merged [including De Nhat, Tin Nghia, Habubank, Western Bank
and Dai A],” Binh said.
“The SBV has
approved plans to merge Southern Bank with Sacombank, and MDBank with
Maritime Bank. It is also guiding the acquisition of some credit
organisations,” he said.
By late June 2014,
total assets and deposits among the country’s nine weakest banks rose 3.l7
and 3.28 per cent respectively, against the 2013 figures. They also recorded
credit growth of 10.18 per cent against late 2013.
The SBV has also
approved restructuring schemes for 24 of the country’s 25 joint stock
commercial banks.
Ernst & Young’s
senior partner financial services Asia Pacific Keith Pogson said
“I’m sure that
foreign investors are still interested in
Last week saw the
US-backed JP Morgan Bank president Nicolas Aguzin in a meeting with Deputy
Prime Minister Vu Van Ninh, express the hope of participating in
Lord Mayor of
London Alderman Fiona Woolf on October 7 said at a dialogue in
She stressed the
PPP model is developing in a dynamic way and
At the dialogue,
Minister of Planning and Investment Bui Quang Vinh said the PPP model
is attractive to
Minister Vinh said
in recent times, the Vietnam Government and the Ministry of Planning and
investment (MPI) have made significant reforms on public investment to
facilitate private investment in
Stanley Boots, an
international consulting expert for the MPI said
However, to fulfill
the target,
The MPI has devised
solutions for dealing with the shortage of capital sources since 2008. In
2009, the MPI also issued a decree to allow the implementation of some PPP
pilot projects and made remarkable reforms in the 2011-2012 period.
The contents of the
new PPP decree are in accordance with
At the dialogue,
head of the MPI's Bidding Management Department, Le Van Tang also
updated information on projects calling for investment under the PPP model in
the time head.
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Tư, 8 tháng 10, 2014
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