BUSINESS IN BRIEF 24/10 Lufthansa Cargo opens flights to HCM City German Airlines Lufthansa Cargo announced on October 22 that it will officially list flights between Frankfurt/Main and HCM City into its permanent fixture this winter. Following a successful test phase over the summer months, the cargo airline will fly a Boeing 777 Freighter every Thursday from Frankfurt/Main, transit via Mumbai (India) to HCM City. It will finally terminate in Hong Kong (China). Frank Naeve, Lufthansa Cargo’s vice president in Asia-Pacific, said Lufthansa Cargo is proud to have built up excellent relationships with clients in Vietnam, which it will now be further cultivating with the fixed freighter connection. He revealed that the cargo airline will bring more attractive services for customers in Asia-Pacific. Vietnam, Ukraine look to expand agriculture trade At a meeting with Vietnam Ambassador to Ukraine Nguyen Minh Tri on October 22 in Kiev, Ukrainian Agriculture Minister Olexiy Pavlenko affirmed there is huge potential for agricultural trade. "The Ukrainian government is processing export licenses for businesses in the agriculture industry to begin exporting products to Vietnam," Pavlenko was quoted as saying by the Agriculture Ministry's press service. Pavlenko said a gradual liberalization of trade policy and diversification of commodities is the key to stimulating agricultural trade between the two countries. Moreover, the overall combined imports and exports of Ukraine with Vietnam for the eight months leading up to September  were US41.6 million, with exports tallying in at US$14.6 million while imports registered US27.5 million. Currently, Ukraine's main agricultural exports to Vietnam are seeds, meat and dairy products said Pavlenko, while it imports fish, rice, spices, fruits and nuts from the Southeast Asian nation.  Taiwan to construct bicycle factory in Binh Duong On October 23, DDK Group based out of Taiwan signed a business deal with Becamex IDC Corp to fund the construction of manufacturing facilities to produce bicycle saddles, grips and bags in the southern province of Binh Duong. Pursuant to the agreement, DDK through its wholly owned subsidiary, Active International Vietnam Co Ltd, will fund the construction of the US$200-250 million plant in the Bau Bang Industrial Park. A spokesperson for DDK said once fully operational, the new facilities would create good paying jobs for about 10,000 locals. Industrial Park at Vinh Phuc Province moves forward On October 22, the Japan Sumitomo Group got the green light from the Vinh Phuc provincial People’s Committee to proceed with construction of the Thang Long III Industrial Park. “After more than 30 months of conducting surveys, the Sumitomo Group decided to go forward with the proposed IP to be located at the Binh Xuyen District in Vinh Phuc Province,” said a company spokesperson. Construction of the  IP’s technical infrastructure is expected to be completed by December 2024. It will give priority to hi-tech projects such as engine manufacturing, support industry, electronic component and precise engineering. Once fully operational, the Thang Long III IP is expected to attract about 79 businesses with investment of US$1.5 billion, generating 25,000 good paying jobs for local people. Workshop to scrutinise logistics development in Mekong Delta A workshop will be held in Can Tho in mid-November to discuss strategies for developing logistics systems in the Mekong Delta, which currently has few. According to Le Van Hy, editor in chief of the Vietnam Logistics Review, the event will offer businesses and localities nationwide an opportunity to learn more about the sector.  It will focus on how to promote the development of logistics services in the region, push co-operation among logistics businesses operating in the area, and discuss plans to build a logistics transport network in the region.  Participants will also be given information on policies to attract investment in the field.  Regional connections and logistics development are expected to facilitate production and goods consumption in the region, making those more professional, thus reducing production and transport costs, and increasing the value of products.  The Mekong Delta boasts great potential for developing its agriculture and aquaculture, which contributes 50%, 65% and 70% of the county’s total food, aquatic and fruit output, respectively.  However, the number of businesses specialising in logistics remains limited, not yet meeting the increasing demand in the field. Over US$530 mln in FDI lands in Binh Duong The People’s Committee of southern Binh Duong province granted investment licenses to 38 foreign direct investment (FDI) projects in the locality on October 23, including 23 newly-licensed and 15 already-operational projects, worth a total of US$531.8 million.  Chief among the new projects are the US$50-million Samoa wood factory in the Thanh An industrial cluster in Dau Tieng district, the US$18-million CLK cold storage company from Japan and the US$12-million factory of Taiwan-based Vistarr Sports Ltd Co.  An extra US$130 million was poured into the Vina Kraft Paper Ltd Co. in Ben Cat district while the Chanh Duong Paper Ltd Co. added more US$74 million in investment.  Binh Duong has lured more than US$1.63 billion in FDI during the first 10 months of this year, an annual growth of 40%.  FDI projects this year include 165 newly-licensed and 107 existing ones, most of which are located in industrial parks.  The province is now home to approximately 2,550 FDI projects with a combined investment of over US$22 billion. Swiss business contingent to tour Vietnam The Consulate General of Switzerland in Ho Chi Minh City on October 22 unveiled plans for a contingent of some 20 Swiss companies to visit Vietnam this October 26-30 on a goodwill business tour. A Consulate General spokesperson said the visit is an outgrowth of the Swiss business community’s continued interest in trade and investment opportunities and its desire to expand its operations in the ICT industry, in particular, in Vietnam. It’s just the beginning of what should be a fruitful relationship for both countries and a preamble to the increased trade and investment that will flow from the Vietnam, EU Free Trade Agreement (FTA) in the offing. “Switzerland now ranks fourth among European nations investing in Vietnam with more than 100 Swiss companies operating in the country, generating more than 15,000 jobs,” the spokesperson said. Switzerland’s total commercial trade with Vietnam surged 35% to US$1.5 billion last year he said, with Switzerland exports to Vietnam tallying in at US$460 million while imports registered US$1.04 billion.  Taiwanese firm builds bike production cluster in Binh Duong A cooperation agreement to build a bicycle production cluster in the southern province of Binh Duong was signed between representatives from the Active International Vietnam Co., Ltd and the Becamex IDC on October 23. Under the document, Active International Vietnam chose the Bau Bang Industrial Park (IP), which was invested by Becamex IDC, to house the cluster. The project, with an estimated cost of 200-250 million USD, will be built on an area of 80 hectares in the Bau Bang IP. Once completed and operational, it is expected to attract 45-60 businesses and generate jobs for 10,000 labourers. The Active International Vietnam is a subsidiary of Taiwan (China)’s DDK Corporation, which is one of the world’s leading bike and plastic spare-part manufacturers.- The firm has operated in the Song Than 2 IP in Binh Duong’s Di An town since 2000. Its factory in the Dai Dang IP in Thu Dau Mot City is scheduled to go into operation this month. Japanese group expands operation in Vinh Phuc The northern province of Vinh Phuc on October 22 granted an investment licence to Japan’s Sumitomo Group to build Thang Long III Industrial Park. Covering more than 213 hectares on the site of the former Binh Xuyen II Industrial Park in Thien Ke and Tam Hop communes in Binh Xuyen district, the project has two phases, with the first costing 1.53 trillion VND (67 million USD). The 1.5 billion USD project is expected to help lure 79 smaller projects and create a breakthrough for the local industry, which is mainly driven by the auto and motorcycle sectors. The project should bring in environmentally friendly, high-tech businesses from the support industry and spare part manufacturing. Once the project’s technical infrastructure and services are operational in late 2024, the park will generate about 25,000 jobs and contribute additional millions of dong to the State budget. Thang Long III Industrial Parks the tenth among the 19 prioritised industrial parks ratified by the Prime Minister in Vinh Phuc province. Earlier, Sumitomo Group built Thang Long I and II Industrial Parks in Hanoi and the northern province of Hung Yen. TPP deal to create momentum for Vietnamese property market Aside from garments, aquaculture and agriculture, the property-related sectors like industrial parks, warehouses and logistics will enjoy the positive effects of the  Trans-Pacific Partnership (TPP) agreement, which was reached by 12 member states on October 5, said experts from CBRE Group, the world’s largest commercial real estate service firm. According to CBRE experts, most of the investments Vietnam will see in the coming time will be from big importers of Vietnamese products, like the US and Japan. The US  will produce more in Vietnam and re-import commodities made in Vietnam. It will eye industrial land in the southern region, where a line-up of existing garment and textile companies are located. In addition, manufacturers in other countries will consider the switch from non-TPP members like China, Thailand, Cambodia, Indonesia and India into Vietnam to enjoy favourable taxes. The move should result in a growing need for land, warehouses and companies. Escalating trade activities will lead to higher demand for logistics services such as roads, railways, seaports and airports. Meanwhile, demand for offices and apartments up to international standards will rise. The new Housing Law, which took effect from July 1, will encourage more foreign buyers to own apartments and houses in Vietnam, instead of leasing. Over 530 mln USD in FDI lands in Binh Duong The People’s Committee of southern Binh Duong province granted investment licenses to 38 foreign direct investment (FDI) projects in the locality on October 23, including 23 newly-licensed and 15 already-operational projects, worth a total of 531.8 million USD.  This is the third wave of grants this year.  Chief among the new projects are the 50-million-USD Samoa wood factory in the Thanh An industrial cluster in Dau Tieng district, the 18-million-USD CLK cold storage company from Japan and the 12-million-USD factory of Taiwan-based Vistarr Sports Ltd Co.  An extra 130 million USD was poured into the Vina Kraft Paper Ltd Co. in Ben Cat district while the Chanh Duong Paper Ltd Co. added more 74 million USD in investment.  Binh Duong has lured more than 1.63 billion USD in FDI during the first 10 months of this year, an annual growth of 40 percent.  FDI projects this year include 165 newly-licensed and 107 existing ones, most of which are located in industrial parks.  The province is now home to approximately 2,550 FDI projects with a combined investment of over 22 billion USD. BIDV pledges support for Vietnamese enterprises in Russia The Bank for Investment and Development of Vietnam (BIDV) is committed to providing credit for the development of a light industrial zone in Russia’s Moscow Oblast. BIDV Chairman Tran Bac Ha made the statement during an October 22 meeting with the visiting governor of the Moscow region, Andrei Vorobyov. The industrial zone in Moscow is expected to attract dozens of Vietnamese enterprises employing thousands of workers in industries such as garments, textiles, footwear, timber and packaging. Ha said initially the lender would provide around US$200 million at rates of 2 percentage points lower than the market average to support investment in the Moscow-based industrial park. For his part, Moscow Oblast’s governor affirmed that the region always welcomes and offers a favourable environment to help Vietnamese companies explore business opportunities in Russia. He noted that the Russian side has determined two possible locations for the construction of the industrial park. According to the BIDV chairman, the Vietnamese lender has established relations with 31 Russian commercial banks and is working with major banks in Russia to support Vietnamese companies to export goods to the largest country in the world. Revenues from import-export transactions with Russia at BIDV were estimated at US$124 million, up 26% from a year earlier. Trade volume touches over US$257 bln As of mid-October, the country's import-export turnover valued US$257.46 billion, representing a year-on-year surge of 11.8% or US$27.22 billion, according to the General Department of Viet Nam Customs.   In the first half of October, the total trade volume was US$13.1 billion, down 10.3% or US$1.49 billion in comparison with the second half of September. In the first half of October, export turnover was US$6.58 billion, down 9.7% against the second half of September.  Experts attributed the decline to reduced shipments of some commodities including garments and textiles (down US$154 million); telephone and components (down US$88 million); steel (down US$59 million); aquatic products (down US$58 million); footwear (down US$54 million). As of mid-October, import turnover valued US$130.72 million,up 14.7% or US$16.73% against the same period last year. Meanwhile, in the first 15 days of October, import turnover fetched to US$6.52 billion, down 10.8% or US$786 million against the second half of September. Work starts on shrimp farm in Bac Lieu province The Vietnam-Australia Seafood Company (VASC) on October 22 kicked off construction of a high-quality shrimp farming complex in the southern province of Bac Lieu. The farm, located in Hiep Thanh commune of Bac Lieu city and covering an area of 315 hectares, will cost an estimated VND1 trillion (US$45 million), according to VASC chairman Luong Thanh Van. The complex, comprised of a baby shrimp hatching facility, a hi-tech intensive shrimp farming greenhouse and a processing plant, is expected to produce around 120-300 tonnes of shrimp per hectare annually. Once the farm is fully operational, it will create jobs for more than 2,000 local residents. Speaking at the launching ceremony, the provincial Vice Chairman, Le Minh Chien, thanked the VASC for building its shrimp farm in Bac Lieu and expressed the anticipation that it would boost the province’s aquafarming industry and contribute to the industry’s sustainable development. He vowed that the local authorities would provide a favourable environment to help the company succeed with its shrimp farm, which is expected to stimulate the local economy. Vietnam’s economic growth sees positive signs: VEPR report Vietnam’s economic growth has seen positive signs in the first nine months of this year, according to a report by the Vietnam Institute for Economic and Policy Research (VEPR). The VEPR, under the VNU University of Economics and Business, cited an expansion of 6.5% during the January-September period as the main reason for its assessment. The institute said growth in the previous three months was 6.81%, the fastest pace recorded in the third quarter since 2011. The increase in gross domestic product was primarily boosted by strong growth in factory output and construction activities, which, as a single category, rose by 9.69% compared with 5.75% and 4.88% in 2014 and 2013 respectively. The VEPR added that except for last September, the Purchasing Managers’ Index has been consistently above the 50 mark, which separates expansion and contraction in the manufacturing sector. Head of the VEPR Nguyen Duc Thanh said inflation in the past nine months was slowing down due to falling energy and food prices, which accounts for 17% of the basket used to calculate the consumer price index, but warned that it could speed up when the Tet holiday approaches. Thanh noted that low inflation is not peculiar to Vietnam but prevalent in most emerging markets thanks to the downward pressure on global energy and commodity prices, which are considered a favourable environment for keeping domestic price levels stable.  Thanh, however, cautioned that money supply’s faster growth than nominal GDP growth, overly relaxed monetary policy, and uncompetitive exchange rates could bring about short-term risks. Commenting on the trade balance, the VEPR report said the deficit of US$700 million in the July-September quarter was better than the gap during the two previous quarters but could widen in the last three months of the year due to increased imports of goods for the Tet holiday. China remains the largest source of Vietnam’s foreign purchases, accounting for nearly one third of Vietnam’s total imports. In the first nine months of 2015, Vietnam ran a trade deficit of US$24.3 billion with China, up 21.3% from a year earlier. The VEPR, however, noted that this phenomenon was not a concern but reflects an acceleration in domestic manufacturing, which led to a higher demand for imported materials, especially those from China. Quang Ngai IZs attract $5.4 million The Quang Ngai Industrial Zones (IZs) Authority has granted investment licences to three new projects worth VND71 billion (approximately US$3.2 million). These projects included a VND18 billion (US$804,000) plant producing galvanised steel and welding material, being developed by Viet Quang Ltd Co, in Tinh Phong IZ. With a monthly capacity of 4,000 tonnes, the plant will be operational in the middle of 2017. Two others were a VND31 billion (US$1.38 million) carton packaging manufacturing factory, being financed by PQ Vina Co and a VND22 billion (US$982,000) plant to supply plastic products, being invested Minh Tien Ltd Co. Both of them will be developed in Quang Phu IZ. The authority last week also allowed a petroleum project, being invested by Mien Trung Petroleum Services and Trading JSC, to raise capital by VND49 billion (about US$2.2 million). The authority said the latest addition has brought the total investment registered in the province's IZs since the beginning of this year to VND620 billion (US$28 million), almost triple the target set for this year. According to the province's official website, Quang Ngai Province will continue to improve the quality of investment promotion and will co-ordinate with the Viet Nam-Singapore Industrial Park to promote potential investors to IZs and the Dung Quat Economic Zone. The province will also improve its investment and business environment while mobilising resources and capital investment for infrastructure in Dung Quat EZ and other zones. Korean firm to invest in US$650-mln solar power plant in Vietnam SolarPark Korea Company has announced its plan to build a US$650 million solar power plant in the central province of Ha Tinh.  Executives and experts from the Republic of Korea's firm recently met with the provincial leaders to discuss the plan and a possible site for the project, according to the provincial Investment Promotion Center. According to the experts, two sites in Thach Ha District are suitable for the 300-megawatt plant, which is expected to take over an area of between 300 and 500 hectares (740-1,235 acres). The company will hand over the plant, the first solar power project in Ha Tinh, to local authorities after 20-25 years. Vietnam is on course to have an installed power capacity of 75,000 MW by 2020, with 46.8% at coal plants, 24% at gas-fired plants and 19.6% hydropower. Renewables will make up 4.5% and nuclear power plants, 2.1%. 94% of businesses could lose data information Lac Viet Software Company has warned that 94 per cent of businesses face loss of data while 65 per cent face loss of clients due to lack of information security. The warning was made before a seminar on Challenge and Solution for Enterprises' Information Security to be held in HCM City October 30. The workshop is to be held in the context of rapid development and demand to maintain continuous performance of businesses.  French firm to sell smartphones, tablets in VN Archos, a French electronics firm which makes smartphones, has entered the Vietnamese market via its partner PetroVietnam General Services Joint Stock Corporation (Petrosetco). Established in 1989, Archos has developed a variety of products, including digital audio players, portable video players, digital video recorders, and netbooks, in addition to personal digital assistants, and a tablet that uses Google Android and Microsoft Windows. It also makes smartphones and smart home devices. Archos will launch its feature phone, smartphone and tablet in Viet Nam at a price ranging from VND590,000 (US$25) for a feature phone to VND6 million ($250) for its tablet and high-quality smartphone.  Transport Hospital IPO raises $5.2m The Central Transport Hospital yesterday received VND116.8 billion (US$5.2 million) after selling 4.95 million shares during its' initial public offering (IPO) at the Ha Noi Stock Exchange. That number of shares was equal to 29.5 per cent of the hospitals chartered capital after it completed privatisation, which could be up to VND435.5 billion ($19.35 million) from VND168 billion ($7.5 million) this year. The State will hold 73 per cent of the hospitals capital after the privatisation and will reduce its ownership in the hospital to 30 per cent in the future. The hospital received the lowest price of VND10,000 and the highest of VND26,000 for its shares. Average price was VND23,597 per share. Thirty-three investors participated in the IPO and offered to buy more than 11.7 million shares from the hospital, nearly 2.5 times the number of shares offered by the hospital. Five million shares were sold to one individual investor and one organisation. Le Tuyen Hong Duong, the hospital's deputy director, said that the IPO was a good move as the hospital was trying to comply with the Government's policies on privatising state-owned businesses. Customers would receive the same benefits and better products and services at the hospital after it completed being privatised, he said, adding that the successful IPO would motivate other state-owned businesses to speed up their transformation. As a leading hospital in the transport sector with 60 years of experience, the Central Transport Hospital has 363 beds, providing healthcare services for 500,000 individuals and 11,000 inpatients each year.  PetroVietnam asked to increase technology application in production Deputy Prime Minister Hoang Trung Hai has suggested the Vietnam National Oil and Gas Group (PetroVietnam) and its partners increase the application of advanced science and technology in production, especially in key sectors. This is one of the effective and sustainable solutions that help cut production costs, raise productivity, lower product and service prices, and effectively use available resources, he said at a conference and exhibition on PetroVietnam’s 40 years of integration and development that opened in Hanoi on October 21. The group was also urged to effectively use its scientific-technological development fund to produce the best results while paying more heed to training the staff working in science and technology-related areas. Deputy PM Hai said PetroVietnam needs to expand cooperation with foreign oil and gas groups as well as international organisations, both bilaterally and multilaterally, in research and personnel training. The group is expected to create technological breakthroughs by 2025 with products of high scientific and technological contents which are eligible for export. The official hailed PetroVietnam’s initiative to organise the conference and exhibition, saying the event will provide in-depth and timely assessments and forecasts for market and technological development trends. More importantly, it will put forth solutions to domestic and global challenges to develop the country’s oil and gas technology in a rapid and sustainable manner, he stressed. The exhibition displays the most cutting-edge equipment and technologies in service of the oil and gas exploration, exploitation and transportation, and technological software, among others. There will be a number of seminars focusing on the exploration in off-shore waters, potential of non-traditional oil and gas resources and how to improve the efficiency of petrochemical plants. The event, which draws representatives from more than 80 domestic and foreign businesses, will last through October 23. Canadian firms updated on Vietnam’s business environment Canadian enterprises have been provided with information related to Vietnam’s business and investment climate and opportunities to make deeper inroads into the country, at a recent forum held in Winnipeg capital city of Manitoba province.  Co-organised by the Vietnamese Embassy in Canada, the World Trade Center Winnipeg and the provincial authorities, the event brought together nearly 100 representatives from Canadian firms and business associations. In his speech at the forum, Ambassador To Anh Dung highlighted fruitful development in Vietnam-Canada relations, affirming the Vietnamese Government’s determination to better investment and business climate, thus attracting Canadian firms in general and those in Manitoba in particular to pour investments in Vietnam.  Manitoba’s Minister of Agriculture, Food and Rural Development Ron Kostyshyn, and Mayor of Winnipeg city, Brian Bowman praised Vietnam’s achievements in recent years, and ex pressed their joy at increasing all-around relations between the two countries, especially in trade and investment.  The forum offered a change for participants to learn more about Vietnam’s land and people, contributing to boosting political relations, and trade links as well as between the two nations.  Immediately after the forum, some Canadian firms contacted with Vietnamese partners to import footwear and furniture for office. They also expressed their hope to set up a distribution channel of products serving water pollution treatment in aquaculture areas in Vietnam.  Manitoba is now the leading locality in developing agriculture and animal husbandry in Canada, while having great potential for developing hydroelectricity projects, manufacturing machines serving the agricultural sector, equipment for aircraft, farm products processing, and production of wooden items and construction materials.  It is rich in natural resources such as gold, copper, zinc, nickel, and oil. Hanoi: CPI rises 0.12 percent in October Hanoi’s consumer price index (CPI) for October showed an increase of 0.12 percent over the previous month and a year-on-year rise of 0.42 percent, according to the Hanoi Statistics Offices (GSO) .  Ten groups of commodities saw their prices go up, with the highest rise – 0.3 percent - seen in the category of apparel, headwear, and footwear due to the change of season.  The food stuffs category increased by 0.28 percent because of rising prices of vegetables, seafood and pork. The category of housing, electricity, water, fuel and building materials saw a 0.08 percent rise due to higher prices of gas and water. Two adjustments to petrol prices brought a 0.18 percent increase in the transport category compared to the previous month and the category of restaurants and catering services climbed by 0.09 percent. Only rice had a price reduction, which was 0.68 percent compared to September due to abundant supply, inventory and decline in rice exports. The capital city’s industrial production index rose by 3.8 percent in October over the previous month and 8.8 percent year on year, making the index for the past ten months increase by 7.8 percent compared to the same period last year. Hanoi’s export revenue in October was estimated to reach 1,032 million USD, a 4 percent rise over the previous month and a 6.7 percent year on year increase whilst the export turnover in the past ten months was estimated at 9,201 million USD, a 1.5 percent year-on – year rise. The import value in October was estimated at 2,344 million USD, a 1.2 percent rise over September and a 9.2 percent year-on year increase. The estimated import volume in the past ten months reached 21,040 million USD, a 5.3 percent year-on-year rise. Vietnam-RoK trade deficit widens by US$12.2 billion The Vietnam trade deficit with the Republic of Korea (RoK) jumped sharply in the eight months leading up to September, according to the Trade Promotion Department under the Ministry of Industry and Trade (MoIT). Imports and exports tallied in at US$18.6 billion and US$6.4 billion, respectively resulting in a trade deficit of US$12.2 billion, the MoIT said, showing that Vietnam businesses lack competitiveness in the Korean market. “Though the RoK import’s a total of US$600 billion of products each year from countries around the globe each year, Vietnam’s market share has been inconsequential,” said Deputy Head Le An Hai of the Asia-Pacific Market Department. Hai said he hopes that things will change as a result of the recent Free Trade Agreement (FTA) the two nations signed that goes into effect next year but exactly how to take advantage of the agreement remains an open question. Fish and seafood exports are the one bright spot on the horizon as the FTA eliminates the tariffs on the first 10,000 metric tons of product per year for the first five years, which then rises to 15,000 metric tons. “However, currently, the industry only has the ability to export 2,500 metric tons of fish and seafood annually and isn’t positioned to take full advantage of the opportunity,” Hai underscored. Similarly for agricultural products, the FTA provides for access to 10%-12% of the RoK import market but the agriculture industry doesn’t have sufficient capacity to produce sufficient product. “In particular, the RoK has opened its doors to Vietnamese produced garlic, ginger, honey and potatoes (which are considered sensitive products and highly protected by the RoK) and it’s a pity we can’t meet the demand.” Hai added that he expects the lack of competitiveness trend to continue and push the deficit higher and make trade with the RoK a drag on overall growth this and in future years. In order to turn the situation around the government and the business community need to devise a new comprehensive business and marketing strategy specifically targeting narrowing the trade imbalance. The clothing and textile, footwear, luxury products, household goods, processed food and natural materials industries should be the centrepiece of that strategy with a national advertising and marketing campaign put in place. According to Hai, the biggest challenge businesses face is that most of them are small or very small and don’t have sufficient funds to invest in retooling and purchasing more modernized machinery and equipment. In addition, they should cooperate more closely and develop alliances to use their collective abilities to keep abreast of matters pertaining to economic integration and seize opportunities as they arise, Hai stressed. Meanwhile plans are in the works at the MoIT to better coordinate with the business community to tackle the difficulties and strengthen exports, particularly in the fish and seafood and agriculture industries. Japan to lift duties on most fish and seafood under TPP The Japanese government recently announced  that tariffs on all vegetable and most fish and seafood imports will vanish under the Trans-Pacific Partnership (TPP) trade deal recently secured by Vietnam, Japan and 10 other countries. “Duties on more than 100 vegetable items will be lifted several years after the free trade accord takes effect,” said Minister Hiroshi Moriyama of the Ministry of Agriculture, Forestry and Fisheries at a news conference. The Ministry reported separately that tariffs on 350 fish and seafood products and about 10 algae products will be eliminated under the agreement including those on sea urchins, octopi and seasoned salmon roes – all popular ingredients in sushi whose current tariffs range from 5-7% Vietnam, Japan and 10 other Pacific Rim countries reached a broad agreement earlier in October on establishing a free trade bloc covering 40% of the global gross domestic product (GDP) and 30% of trade. Tokyo had fought to keep tariffs on sensitive agricultural products such as rice during a half decade years of negotiations with the 11 other nations including Vietnam, the US, Chile, Mexico, Peru, Canada, Australia, New Zealand, Singapore, Malaysia and Brunei. Moriyama dismissed concern over the potential negative impact on farmers from the new trade deal, saying vegetables such as carrots and onions are imported mainly from China, which is not a TPP member, and potatoes cannot be imported in reality due to quarantine restrictions. “We will take all possible measures” to support farmers who might face competition from cheaper imports, he said. In the wake of the new trade deal, Prime Minister Shinzo Abe earlier this month pledged to carry out steps to bolster the competitive edge of the country’s agricultural industry, which has been heavily protected until now. The farm ministry has previously said Japan will eliminate tariffs on about half of the 834 agricultural products subject to duties after the TPP takes effect. Tariffs on bonito and frozen sockeye salmon will be abolished immediately upon the TPP taking effect, while those on mackerel will be removed over a phase in period of 16 years, according to the Ministry. Meanwhile, Japan’s Ministry of Economy, Trade and Industry has set up a task force to promote measures to help small businesses take advantage of the TPP. At the first meeting of the team, headed by METI Minister Motoo Hayashi, members agreed to keep the companies well informed about the TPP deal, on which a broad consensus was reached, and start holding briefings for them as early as this month. The briefings will be held in all 47 prefectures as well as in the other 11 participating countries in the TPP, including Vietnam.  The Japanese government has started briefing local government officials in charge of agriculture and fisheries products as well. The task force also plans to promote alliances between the farming, commerce and industrial industries to create new businesses in cooperation with the Ministry of Agriculture, Forestry and Fisheries. As a measure to encourage overseas expansion by small businesses unfamiliar with export procedures, the team will tell them how to draw up their own nontariff or tariff-reduction certificates for their goods required under the TPP pact. Firms yet to capitalise on FTA Many Japanese firms in Viet Nam have failed to make the most of tariff preferences under the Viet Nam-Japan free trade agreement, said Atsuko Fukagawa, deputy managing director of the Japan External Trade Organisation (JETRO) office in HCM City. She made the remark at a workshop on the Viet Nam-Japan Free Trade Agreement (FTA) and Economic Partnership Agreement (EPA) in HCM City on Wednesday A JETRO survey of Japanese enterprises in Asia and Oceania last year indicated a FTA utilisation rate among those operating in Viet Nam at 36 per cent, which is lower than that of their peers in the region, for example, Indonesia (58.2 per cent), Thailand (53.7 per cent), and Malaysia (48.9 per cent). At the event, experts updated attendees on the FTA and EPA, and clarified related rules of origin (ROO) requirements in the hope of helping Vietnamese and Japanese businesses take full advantage of the two agreements. Nguyen Quan Phuc from the Import-Export Department under the Ministry of Industry and Trade, stressed the significance of the ROO as it helps determine imported goods that qualify for preferential tariffs. Firms that meet the ROO requirements will benefit from the preferential tariffs and be able to expand their businesses further, he added. Japanese companies in Viet Nam contributed about 60 percent of the Southeast Asian nation's exports to Japan and 20 percent of that to the ASEAN region. Many Vietnamese businesses are also looking for opportunities to access the Japanese market.  HCM City consumer price index ups 0.06 percent Ho Chi Minh City’s consumer price index (CPI) in October increased 0.06 percent from the previous month, according to its Statistics Office.  The figure represented a 0.9 percent decrease from October, 2014 but a 0.34 percent 10-month rise year on year.  According to the office, prices of nine out 11 statistical groups of commodities went down, in which those in culture and entertainment slipped 0.56 percent and transport downed 0.52 percent from September, due to the drop of gas and oil prices.  Housing, electricity, water, fuel, and building materials decreased 0.14 percent while goods and other services contracted 0.12 percent. Post and telecom services were down by 0.09 percent; beverage and tobacco, 0.08 percent; pharmaceuticals and health services, 0.05 percent; and education, 0.03 percent, month on month.  In October, price hikes happened in household appliances with 0.09 percent and restaurant and eating services with 0.38 percent. Prices of clothing, hats and footwear remain stable.  During the month, gold and USD prices diminished 1.13 and 0.56 percent, respectively. Dong Nai’s FDI attraction goes beyond expectations Foreign direct investment (FDI) into southern Dong Nai province has hit 2.15 billion USD as by mid-October, exceeding expectations and this year’s target of 900 million USD.  The Dong Nai Industrial Zones Authority (DIZA) reported that local industrial zones have lured over 350 million USD of FDI in October, including nearly 225 million USD invested in 11 new projects and over 126 million USD in five existing ones.  The 31 industrial zones in Dong Nai have attracted 82 new FDI projects with a total registered capital of more than 1.5 billion USD so far this year. Meanwhile, 75 FDI companies have added more than 592 million USD to their existing projects.  Most of the FDI capital this year went to production, processing, manufacturing and hi-tech projects. Notably, the Republic of Korea’s Hyosung Corporation earmarked 660 million USD for a hi-tech fibre production project in the locality.  The DIZA highlighted positive performance of locally-based FDI firms which gained more than 13.9 billion USD in revenues since the outset of 2015, a year-on-year increase of around 5 percent.  The authority noted that Dong Nai, located in the southern key economic region, considers FDI as a big growth engine but does not want to attract it at all costs.  It added in mid-2014, the province publicised a list of industries prioritised for FDI attraction, including support, processing and manufacturing projects using high technologies, and another list of industries that temporarily do not need investments, such as paper and paper pulp production.- Vietcombank chooses Credit Suisse, VILAF for equity issue The Joint Stock Commercial Bank for Foreign Trade of Vietnam, Vietcombank, on October 22 signed a contract with Credit Suisse and the Vietnam International Law Firm (VILAF) for a new equity issue.  Under the contract, Credit Suisse will act as the finance consultant for the bank while VILAF will be responsible for legal aspect.  According to the bank, the equity issue aims to help the bank raise capital and prepare for the implementation of BASEL II, which are recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision, from the beginning of 2016.  Pham Quang Dung, Vietcombank General Director, said the issuance will help Vietcombank keep pace with the economy’s strong growth as well as maintain its leading position in the banking system.  Helman Sitohang, General Director of Asia-Pacific Credit Suisse, said the cooperation is an important landmark for Vietcombank and a contribution to the capital market development in Vietnam.  Credit Suisse has operated in Vietnam since 2001 and has become the biggest foreign capital broker in Vietnam with a brokerage value reaching over 6 billion USD so far. VNPT to auction 71.5 million MSB shares The Ha Noi Stock Exchange (HNX) has announced the auction of 71.5 million shares in Maritime Commercial Joint Stock Bank (MSB) by the Vietnam Posts and Telecommunications Group (VNPT). The auction will take place on November 20. The opening price will be VND11,700 (US$0.52) per share, three times higher than the price of MSB shares traded on the over-the-counter market in September. If the transaction is successful, VNPT will collect at least VND837 billion ($37.5 million) from the divestment. The sale is part of the VNPT's development plan in response to the Government's Decision No. 888 to restructure the State-owned group. The decision regulated that the group divest all capital from its non-core businesses. Thus, besides MSB, the group will have to completely divest other 62 companies including Bao Minh Insurance Company, 57 joint stock companies and limited companies, and four investment funds. MSB, which merged with the Mekong Development Bank in August, holds chartered capital of VND11.75 trillion ($525 million) and assets of VND113 trillion ($5.06 billion). Indonesia to import rice from Vietnam, Thailand Indonesian President Joko Widodo has given the green light for rice import from Vietnam and Thailand in a bid to cater for domestic consumption and stabilise prices. The President’s decision was announced at the 30th Trade Expo Indonesia in Jakarta on October 21.  President Widodo earlier rejected the import many times.  Indonesian authorities have negotiated with regional rice producers for shipments in case of emergency, with Vietnam able to provide one million tonnes and Thailand having yet given any number.   Indonesia is considering the import volume as changeable weather patterns could largely effect the scale of crop failure.  According to the ministry of agriculture, prolonged dry season in combination with harmful impact of El Nino have led to water shortage across 200,000 hectare of paddies, 30,000 hectares of which failed to yield.  As a result, the national production is unlikely to reach the yearly target of 75.5 million tonnes.  Head of Indonesia’s State Logistics Agency Djarot Kusumayakti said by December, the agency’s rice stock will reach 62,000 tonnes but around 1.5 to 2 million tonnes are needed to meet next year’s demand prior to the harvest. Vietnam-Brazil trade projected to hit US$4 billion this year Vietnam-Brazil trade turnover jumped 20.8% to US$2.723 billion in the January-September period and is likely to reach US$4 billion this year, according to the Ministry of Industry and Trade (MoIT). Of the figure, Vietnam’s exports to Brazil tallied in at US$1.114 billion, up 9.7% and imports at US$1.579 billion, up 30.3%. Major exports to Brazil posting a relatively high growth included telephones and components (up 25% to US$433.3 million), computers and electronic components (up 19% to US$79.2 billion), garment (up 11% to US$55.3 million), and seafood (up 42.9% to US$54.4 million). Key import products included corn (up 52.6% to US$610 million), animal feed (up 26.5% to US$231.3 million), garment and textile materials (up 23.7% to US$143.9 million), wheat (US$75.1%), cotton (US$86.9 million) and soya bean (US$220.8 million). To fulfil export targets, the Vietnam Trade Office in Brazil has intensified trade promotion programs in key economic regions and populous residential areas with high purchasing power so as to expand exports to the South American nation. Over the past several months, the office’s trade promotion campaigns and business conferences and forums have helped connect Vietnamese businesses with their Brazilian partners. Finland wants stronger education and IT cooperation with Vietnam Vietnam is a potential and appealing market for Finnish companies and the European country looks to strengthen cooperation with the Southeast Asian country, especially in the education, information technology and telecom sectors.  Cooperation opportunities were explored at a conference on investment and supporting tools for businesses in the sectors in Vietnam and Finland held by the Vietnam Chamber of Commerce and Industry (VCCI) and the Finnish embassy in Vietnam in HCMC on Tuesday. Ilkka-Pekka Simila, Finnish ambassador to Vietnam, told the conference that Vietnam was one of the long-term partners of Finland and that some 75 Finnish enterprises are doing business here in the country. The two nations have cooperated in the education, information technology and telecommunication sectors over the years. Simila said these sectors were important and covered many fields like e-government, cyber security and technologies for healthcare and education.  Vo Tan Thanh, vice chairman of VCCI, said Vietnam and the European Union completed negotiations over the free trade agreement (FTA) in early August and had boosted cooperation in many sectors in the past year. Finland is considered a potential partner which is strong in many fields and can help Vietnam.  Simila said Finland had an advanced science-technology sector.  Two-way trade between Vietnam and Finland neared US$263 million in 2014, up 14% against 2013. Of which, Vietnam’s exports made up US$104.6 million, up 29.5% year-on-year and imported US$158 million worth of products from the European country, up 5.8%. In the first eight months of 2015, two-way trade exceeded US$215.6 million. Vietnam’s exports to Finland accounted for US$78 million, mainly coffee, footwear, apparel, wooden products and handicrafts. The country imported IT and telecom products (80%), machine and equipment. Vietnam and Finland signed an investment promotion and protection agreement in 2008, laying a legal foundation for the two countries to promote ties in many sectors. As of September 20, Finnish companies had registered total capital of US$325 million for 13 projects in Vietnam, mainly in the industrial glue, apparel, woodwork and machinery sectors.  Over 500 Vietnamese students are studying information technology and business administration in Finland. The European country has carried out a number of programs for student and lecturer exchanges with Vietnam and coordinated with Haiphong University and Hue University of Medicine and Pharmacy.  Vietjet to notify passengers of flight schedule changes via Zalo With an aim at facilitating passengers and bettering its services, Vietjet will bring into force its system to notify passengers of flight schedule changes via Zalo beside SMS.  Accordingly, the airline’s system will automatically send to passengers’ Zalo account a message updating flight schedule. Message status will be checked and reported back to the system five minutes after that. If the message isnot read, the system will also send an SMS to passengers’ account. It is advisable for passengers to update flight information at www.vietjetair.com, just by click “Manage my booking” tab. Cat Chu mango to be exported to Japan Vietnam mangoes meet all requirements to be shipped to Japan, opening an excellent opportunity for Vietnam fresh fruits to penetrate demanding markets, said Nguyen Trung Dung, minister-counsellor at the Vietnamese embassy in Japan.  Experts from Japan’s Ministry of Agriculture, Forestry and Fisheries completed the final evaluation of Vietnam’s Cat Chu mangoes before shipping to Japan at the Yasaka Fruit Processing Company in Binh Duong and Good Life Company in HCM City on October 21.  They concluded that Vietnam fresh mangoes met all quality criteria to enter Japan. Mango is the second after fresh dragon fruit that Vietnam ships to the demanding market. Masumi Watanabe, managing director of Yasaka Binh Duong said the company is preparing to ship the first batch of mangoes to Japan. Yasaka’s partners who are big distributors in Japan are prepared to buy Vietnam mangoes. Vietnam mangoes will sell well in Japan, Watanabe hoped. Exporters said first batches of mangoes shipped to Japan came from Cao Lanh plantations in Dong Thap province. Mangoes of this variety have been exported to the Republic of Korea. The Plant Protection Department suggests that local authorities should quickly restructure Cat Chu mango plantation areas and help growers shift to modern planting methods to meet VietGAP and GlobalGAP criteria for export. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR