BUSINESS IN BRIEF 23/8 HCMC Party chief pushes for e-toll collection Secretary of the HCMC Party Committee Dinh La Thang has proposed the Ministry of Transport quickly apply electronic toll collection (ETC) technology at build-operate-transfer (BOT) road projects to better control toll collections and ensure transparency. Thang made the proposal at a conference last week in HCMC on improvement of transport connectivity for the southeastern region to fuel economic growth. At the conference, representatives of HCMC’s neighboring provinces including Binh Duong, Dong Nai, Long An and Tay Ninh said traffic bottlenecks between the city and these provinces have put a dampener on transport and the region’s development. Tran Thanh Liem, vice chairman of Binh Duong, said roads linking HCMC and Binh Duong are often congested, especially at the Ong Dau bridge section of National Highway 13 and a 1.2-kilometer section near the Go Dua intersection. Waterway transport is chocked at Binh Loi Bridge as well. Liem suggested prioritizing construction of ring roads 3 and 4 to connect all the southeastern provinces. Long An and Tay Ninh are also struggling with congestion on national highways 50 and 22 connecting to HCMC, respectively. Provincial representatives said the biggest obstacle faced by regional transport projects is a lack of funding. Localities have found it hard to implement large projects such as expressways on their own and suggest collaboration between neighboring provinces to raise investment capital. According to the Ministry of Finance, as the Government has not finalized the medium-term capital allocation for the 2016-2020 period, provinces must actively look for finances from different sources to carry out big projects. Thang said it is necessary to create a specific development policy and mechanisms to call for investment in transport infrastructure development. For example, provinces can seek permission from the Government to choose investors and contractors for road projects on their own. Finances can be reviewed and approved by the people’s councils in line with the finance ministry’s regulations. He said a proposed initiative to have provinces take turns as the regional development coordinator will be ineffective as only the Government and the deputy prime ministers are authorized for this task. Thang agreed with the Ministry of Finance that provinces must look for funds from other sources for infrastructure projects instead of depending on the State budget. Regarding the massive investment in BOT projects in the last three years, the HCMC Party chief said the BOT model has no intrinsic weaknesses and that problems mainly resulted from poor management. He said in fact BOT projects such as the Noi Bai-Lao Cai expressway have brought numerous benefits such as shorter travel time and less cost for road users. Thang proposed the ministry apply ETC technology for BOT projects to ensure transparency of fee collection and help calculate the payback time for these projects. He suggested devising a priority list of traffic connection projects between HCMC and the provinces to implement them one by one. To do so, a regional transport connectivity committee including the transport departments of the city and other provinces in the southern economic zone should be set up. Liquidity abundant in banking system Coupons of treasury bills issued by the State Bank of Vietnam (SBV) have dropped steadily this month, an indication of ample liquidity in the banking system, according to an update report of Maritime Bank’s Economic Research Center. According to local media, the August 18 auction saw all VND8 trillion of 14-day debt snapped up by banks with its coupon falling to 1% per year.  The central bank organized an auction of treasury bills on May 30 after a six-month suspension in the backdrop of abundant liquidity at banks. The annual coupon of 14-day bills was 1.5% but then dipped to 1.4%, 1.3% and 1% this month. Data of the research center showed that outstanding bills had amounted to VND48 trillion as of August 18. Bill issues are aimed at absorbing surplus capital in the banking system to adjust interest rates and reduce short-term impact on foreign exchange rates and inflation.   Bill coupons have gone down sharply while banks have acquired all debt issued by the SBV, which indicates liquidity has been ample in the banking system.  From February until now, the central bank has acquired a large volume of foreign currency, estimated at some US$9 billion. In doing so, the central bank injected a big volume of Vietnam dong into the economy. Therefore, it has to issue treasury bills to help stabilize the domestic currency market. In July, money supply edged up 9.45% compared to the end of last year and was much higher than in the same period in previous years. Ninh Thuan promotes investment attraction An international conference on investment promotion in the south central coast province of Ninh Thuan will be opened in Phan Rang-Thap Cham city on August 27, heard a press conference in the province on August 22.  Deputy Chairman of the provincial People’s Committee Le Van Binh said the event is expected to see the participation of about 400 foreign and local delegates, including leaders of ministries, sectors,enterprises and investors. The event will focus on presenting to investors the province’s investment incentives, development advantages and key investment projects, whereby calling for strategic investors while bolstering bilateral and multilateral cooperation.  Highlights of this year’s event is that the province will promote direct investment to projects, prioritise projects investing in the province’s key economic sectors, as well as 57 potential projects calling for practical, effective and saving investment, he added. Mechanisms, investment incentives and investment attraction measures in the locality were also discussed during the press conference. Vietnam-Japan Joint Initiative helps improve investment climate Vietnam and Japan have agreed to implement the sixth phase of their Joint Initiative for the next 17 months, starting from August 2016. A memorandum of understanding to this effect was signed at a meeting of the Joint Committee of the Vietnam-Japan Joint Initiative held by the Ministry of Planning and Investment in coordination with the Japanese Embassy in Vietnam and the Vietnam-Japan Economic Committee in Hanoi on August 22. The sixth phase will focus on employment, salary, logistics and transportation, services, small- and medium-sized enterprises, pharmaceutical products, the Law on Investment and the Law on Enterprises. The initiative, launched in April 2003 as a result of special cooperation between the two Governments, aims to create an open and transparent business and investment climate in Vietnam through a policy dialogue between Japanese investors and relevant Vietnamese ministries and agencies, said Minister of Planning and Investment Nguyen Chi Dung. It also makes proposals to help competent Vietnamese agencies complete laws and policies, he added. Japanese Ambassador Fukada Hiroshi said the local investment environment has been improved significantly thanks to the initiative, encouraging Japanese businesses to pour more investments into the Southeast Asian nation while helping the country lure more foreign investors. Lam Dong province calls for investment The Central Highlands province of Lam Dong is seeking investments for 53 projects worth 2.8 billion USD in transport, industrial zones, bio-technology, and hi-tech farming, in addition to food processing and tourism. Deputy Chairman of the province's people's committee Phan Van Da made the announcement at an investment promotion event in Da Nang last week. He said the province offers preferential policies and smooth conditions for investors in boosting connectivity between Lam Dong and cities and provinces in the central region. "The province is eyeing four key projects such as Da Lat-Thap Cham railway system, the Dau Giay-Lien Khuong Expressway, the Tan Phu Industry - Agriculture Zone, and Da Lat Bio-Technology and Hi-tech Agriculture," Da said. "We have also included centralised information technology, tourism, trading centres, and living quarters, in addition to aquaculture, flower and farm produce transaction centre and international hospital projects," he said, and added that all projects have been included in the provincial Master Plan to 2030 and a vision to 2050. Dang Xuan Quang, deputy head of the foreign investment agency under the Ministry of Planning and Investment, said Lam Dong has huge potential of investment in tourism, hi-tech farming, but reforms in the investment environment is still seen as the biggest challenge. He said the province should offer good infrastructure to investors, fast administrative reforms as well as preparation of a skilled labour force. According to Deputy Director of the Provincial Planning and Investment Department Phan Van Dung, Lam Dong itself offers preferential policies for investors including land rent exemption, income tax, human resource training support and free import tax for initial project construction. The Central Highlands province hosted 5.1 million tourists, of which 220,000 were foreigners, in 2015. Vegetable, flower and coffee beans are the key farm produce in the province which include 2 million tonnes of vegetables, 410,000 tonnes of coffee beans and 2.5 billion flowers each year. Lam Dong has been developing the Da Lat vine brand plant with a capacity of 5 million litres per year. To date, the province has attracted 103 foreign direct investment (FDI) projects worth 580 million USD. Covering on 597,000ha, the province has two national parks – Bidoup-Nui Ba and Cat Tien – and UNESCO-recognised World Biosphere Reserve Lang Biang. Last year, the province put into operation the Dong Nai 2 hydropower plant, which provides 263.8 million kilowatts of electricity per hour to the National Power Grid. KIDO aims at $90mn profit Following an audit, the after tax profit of the KIDO Group Corporation (KIDO) has been restated at VND141 billion ($6.3 million) for the first half of this year, down VND20 billion ($896,800). This, the corporation said, was due to adjustments to the profit of its affiliate, the Vietnam Vegetable Oils Industry Corporation (Vocarimex). According to KIDO’s CEO, Mr. Tran Le Nguyen, “2016 will see KIDO’s profit surpass VND2 trillion ($89.7 million), up from the targeted VND1.5 trillion ($67.3 million).” Despite KIDO’s after-tax profit for the first half being revised down to VND141 billion ($6.3 million), Mr. Nguyen’s target of VND2 trillion ($89.7 million) for the year as a whole remains within reach. In the course of the second half KIDO plans to sell its remaining 20 per cent holding in its subsidiary the Kinh Do Binh Duong JSC (BKD) to the US’s Mondelēz International. It expects to reap VND2 trillion ($89.7 million) from the deal and during this year would receive VND1.7 trillion ($76.2 million). While the corporation is planning to exit the confectionary business with its sale of BKD, its other businesses remain strong, including frozen products (ice cream, yogurt) and cooking oil products, which are expected to bring profit of VND460 billion ($20.6 million) this year. In the first seven months of this year, KIDO’s profit from ice cream was reported at VND160 billion ($7.2 million), higher than the VND110 billion ($4.9 million) recorded for all of 2015. According to Mr. Nguyen’s estimate, 2016 may see KIDO reaping VND230 billion to VND240 billion ($10.3 million to 10.8 million) from ice cream. In cooking oil, the corporation plans to increase its holding in Vocarimex to 51 per cent by the end of the year. “The move is aimed at consolidating the company’s revenue and profit as well as improving its business performance and stabilizing its material sources,” KIDO’s Deputy CEO and Vocarimex’s Managing Director Ms. Nguyen Thi Xuan Lieu told VET. Acknowledging the tough competition in the instant noodle sector, KIDO is determined to focus on superior products rather than covering all segments, as initially planned. Since the end of 2015 the corporation has examined frozen steamed buns. Its factory in Ho Chi Minh City’s Cu Chi district is now operating at full capacity, with daily output of 120,000 sweet and salty frozen steamed buns. This, according to KIDO, is a market of potential with high profit margins. “If everything continues to run as smoothly as now, KIDO estimates profit in 2016 from frozen products can reach VND350 billion ($15.7 million) and VND600 billion ($26.9 million) in 2017,” Mr. Nguyen said. “This will surpass the commitment from KIDO’s Board of Management in 2015 of returning KIDO’s profit to VND600 billion ($26.9 million) within the next three years.” A report released by the Ho Chi Minh Securities Corporation (HSC) on August 16 said it had increased its expectations on growth in KIDO’s profit for 2016 and also 2017. It believes its share purchase in Vorarimex is being hastened and it expects KIDO to take control by the end of the third quarter. Rumors that KIDO is targeting the Tuong An Vegetable Oil Company have pushed up the former’s share price. On August 17 it stood at VND32,800 ($1.5); its highest point in a year.        With KIDO’s vigorous changes along with its firm financial base, Mr. Nguyen is positive about its ability to surpass VND10 trillion ($448.4 million) in total revenue in the near future. At that time, “KIDO’s share price increasing four-fold will be nothing unusual,” he said. Minister suggests develop shrimp as national strategic product Minister of Agriculture and Rural Development Nguyen Xuan Cuong has suggested developing shrimp as a national strategic product as it can contribute to agriculture growth in the rest of 2016. The shrimp sector needs to build a strong brand in the global market, he said, adding that this product has a large consumption market. In the context of climate change, Vietnam can turn challenges into advantages, he said. The Mekong Delta needs to convert some rice growing areas into seafood breeding due to rising sea levels and increasing salinity, he explained. There is potential for shrimp products to develop under the seafood restructuring strategy, he added. According to the Ministry of Agriculture and Rural Development, shrimp exports are likely to surpass 3 billion USD by the end of this year. Vietnam ships shrimp to 75 markets. The top 10 importers include the US, the EU, Japan, China, the Republic of Korea, Canada, Australia, ASEAN, Taiwan (China), and Switzerland, making up 95 percent of total shrimp export turnover in Vietnam. The seafood sector raked in 3.15 billion USD from exports in the first six months of 2016, a year-on-year rise of 4 percent. Shrimp exports made up 1.4 billion USD, up nearly 5 percent against the same period last year. Ha Giang boosts border trade with Chinese locality  The northern mountainous province of Ha Giang will promote trade with China ’s southwestern province of Yunnan, a local official has confirmed. Director of the centre for industrial encouragement and trade promotion Le Thi Thu Hang said the provincial Department of Industry and Trade plans to increase cooperation with the Yunnan Hardware and Electromechanical Chamber of Commerce (YHEC). The move aims to boost cross-border trade via the Thanh Thuy (Ha Giang) and Tianbao (Yunnan) international border gates, she said. As the northernmost point of Vietnam and sharing a border with China , Ha Giang is positioned to develop trade with the 1.6-billion-strong market. Vietnamese Prime Minister Nguyen Xuan Phuc allowed Ha Giang to establish the Thanh Thuy border economic zone on an area of nearly 30,000 hectares. The province will build another border gate (Xin Man – Doulong) in September 2016. Ha Giang is also home to 27 border markets. To promote trade, Ha Giang and China’s Wenshan Zhuang and Miao Autonomous Prefecture have invested in infrastructure and transport connectivity while accelerating administrative reform to help businesses exchange goods. The two sides have also introduced tax exemption and reduction policies and encouraged investors to develop infrastructure. In the first six months of 2016, two-way trade increased 4.7 times against the same period last year, the highest level so far. Speaking at a meeting with the local centre for industrial encouragement and trade promotion from August 19-21, President of the YHEC Zhang Yuanyuan lauded the potential of Ha Giang and recognised its past trade and investment collaboration with Yunnan. He said the YHEC will call on Chinese businesses to explore investment in Ha Giang and pledged to help them choose suitable investments to boost cross-border trade. The chamber will organise more trade fairs and exhibitions to help businesses of the two sides introduce their products and seek partners, he added. Ministry eyes promoting stable realty market The construction ministry is drafting a project on management of the property market through six measures to support transparency and stability, Minister of Construction Pham Hong Ha said. The minister said at a meeting with property developers -- held by the Vietnam Real Estate Association last week -- that the property market in the first seven months of this year was stable and that no unusual developments were seen. However, there were potential risks to which special attention must be given. Ha said the imbalanced developments in supply and demand of luxury projects and housing projects for low-income earners are a problem, adding that oversupply of the former and shortage of the latter is forecast for next year. The country needs 10 million square metres of social housing, but currently has only 30 percent of that. In addition, there is a severe shortage of housing projects for lease. Promoting social housing developments will be the focus, and policies will be prepared to encourage property developers to invest in this segment, the minister said. The concentration of the credit flow in high-end projects or a minority of developers is another risk, although outstanding loans in the property sector remained at a safe eight percent of the total outstanding loans, he said. He added property developers should tighten management of their own projects to ensure liquidity and be prepared for credit tightening policies. He also noted that while there was some speculation in some projects, it had not become a widespread phenomenon. The ministry will closely watch the market developments to ensure sustainable growth and efficient and cost-effective use of resources, Ha said, stressing the importance of the real estate market in macro-economic stability. According to the minister, financial resources for property development played a key role. “It’s time Vietnam eyes new capital sources such as from real estate investment trusts,” he said. Capital for property development in Vietnam now mainly comes from developers, banks and citizens. In the draft, the ministry is seeking to prepare policies to accelerate the capital market for property development. Improving the transparency of the property market is also an important measure. President of the Vietnam Real Estate Association Nguyen Tran Nam said detailed instructions for transactions in unfinished property projects are needed, together with tighter management to ensure compliance. According to Nam, the construction ministry should work with relevant ministries and agencies to publicise areas where foreigners will not be allowed to buy houses or apartments. He said the association will work with construction authorities in building a market database that is necessary to boost the development of the real estate market. Dong Nai exports fall short of target The southern province of Dong Nai has reported a lower export growth rate that expected in the first seven months of the year. In the period its exports were worth US$8.7 billion, an increase of 4.35 percent year-on-year, while, for the full year, its People's Committee has set a growth target of 11-12 percent. Duong Minh Dung, deputy director of the province's Department of Industry and Trade, attributed the low rate to falling prices of many goods. A fall in orders from Europe and Japan, especially for furniture, has also had an impact on the exports. According to the People's Committee, shipments by foreign firms and non-State-owned enterprises have been rising at very low rates, 4.71 percent in the case of the former and 1.63 percent in the case of the latter. But exports by State-owned enterprises grew at a robust 12.7 percent. Goods that continued to see solid growth in exports were coffee, which increased 24.7 per cent to US$353 million, footwear (20.8 per cent, $1.77 billion) computers and electronic products (10.18 per cent, $254 million), and transportation equipment (7.8 per cent, $452 million). Garment, fibre, and some other main export items, however, saw low growth rates. The province's industrial output rose by 8.19 per cent year-on-year. Automobile production increased by 15.3 per cent and leather production by 11.2 per cent. The People's Committee expects exports to see better growth in the remaining months of the year since companies are expanding production to meet orders.  Risk management essential for finance sector Risk management is now an important part of Vietnam’s financial system after some banks suffered high losses and capital deficits, and merged with other banks. Concerns have been raised in the financial sector over how risk can be managed to protect investors’ assets, especially when banks and property developers have rapidly developed in the past five years on loosened lending policies and low interest rates. The significant growth of the two sectors has caused worries over stability. “StoxPlus acknowledges that all sectors of Vietnam’s economy, including the stock market, has to face a high risks regarding some factors such as foreign exchange rates and interest rates,” said Nguyen Quang Thuan, StoxPlus CEO, at the August 19 talk-show on market risk management, which was organised by StoxPlus, an associate information provider of Japan-based Nikkei Inc and Quick Corp. Investors and traders could see the risks through recorded data and figures, however, those numbers were only as good as their reliability and accuracy, according to Thuan. Proprietary trading (prop trading) that financial firms use to earn profits in trading stocks in their own investment portfolios may generate big losses for banks, Harry Hoan Tran, risk management expert at the Britain-based Lloyds Bank, said. “Most banks think they can go to the market, buy some stocks at low prices and then sell them for higher prices.” After the financial crisis in 2008, prop trading became a zero-sum game for banks, so they have concentrated on investment funds and pension funds. “Prop trading is limited at a very low level. Banks would not make prop-trading orders if it was not for their customers,” Harry said. According to StoxPlus, only one or three percent of trading orders during a session is prop trading. ‘People’ may also be a risk for a financial firm as they can disrupt the system, faking future and forward contracts to earn profits, according to Harry. Financial firms should find a way to monitor traders to minimise risk. “Front office should be able to supervise traders in the department, while middle office should be able to keep track of trading orders and transactions as future and forward contracts are not paid in real money, allowing traders to fake contract terms to make money,” said Harry. Banks, securities firms and investment funds should calculate potential losses based on the market’s normal and volatile conditions so they can lower damage caused by volatile foreign exchange rates and interest rates. In order to set up scenarios, market members must evaluate products and assets, address input variables, for example, investors should be able to predict how the bond market moves when interest rates change and volatile how the market is, he said. Analytical tools for risk management are now available in Vietnam. Banks can use those tools to calculate input variables for their investments, Pham Hai Au, LienVietPostBank’s Deputy CEO, said. Some local banks have bought analytical software programmes from Reuters Thomson, allowing front and middle offices and market risk offices to track down trading orders at the same time, reducing the risk of cheating among traders, he said. Banks have enough capital to deal with the risks they may face, Au said, adding that the higher danger of risk, the more capital banks need.- Thailand leads in exporting automobiles to Vietnam Thailand ranked first among automobile exporters to Vietnam over the last seven months, with a volume of 18,837 units worth 343 million USD, representing increases of 55 percent in volume and 73 percent in value compared to the same period last year. Statistics from the General Department of Vietnam Customs showed Thailand was followed by the Republic Korea, India, China and Japan. Since April this year, the volume of automobiles imported from China to Vietnam saw a strong tumble, not quite reaching 1,000 units in July. The country shipped just less than 8,000 vehicles to Vietnam in the first seven months of 2016, a cut of nearly 50 percent. Though China ranked fourth in export volume of automobiles to Vietnam in the last seven months, it was only behind Thailand in value, with 301 million USD. It is predicted that Vietnam will continue importing low-powered, smaller-engined cars due to buyers enjoying preferential import tax and special consumption tax . The General Department said, the country bought a total of 60,600 automobiles worth 1.42 billion USD from abroad in the Jan-July period, a year-on-year drop of 5.9 percent in volume and 17.3 percent in value. Of the figure, there were 25,500 car with nine seats or lesser, and 26,200 trucks imported, representing increases of 16.6 percent and 7 percent, respectively. The country imported only 650 vehicles with nine or more seats, a reduction of 24.9 percent.- PV Drilling provides drilling services for Myanmar The PetroVietnam Drilling and Well Services Corporation (PV Drilling) will provide a drilling rig and drilling related services for Myanmar from October, said PetroVietnam (PVN) on August 22.  Under an agreement with Total E&P Myanmar, PV Drilling will supply its Drilling 1 rig to serve a 164 day drilling campaign in blocks M5 and M6 of Myanmar’s sea. Extensions to the drilling will be discussed after the campaign.  Total E&P Myanmar Director Xavier Preel expressed his belief in the management and operation of PV Drilling as well as the capability of PV Drilling 1 staff.  PV Drilling is capable of completing the campaign in a safe manner at a reasonable price, he added.  PV Drilling Chairman of the Management Board Do Van Khanh pledged that his company will do its utmost to achieve maximum efficiency in the project.  In the context of the world’s sharp fall in crude oil price, resulting in decreasing rig rentals, PV Drilling 1 was awarded the project over 30 other rigs from 10 companies across the world.  Since 2007, PV Drilling 1 has continuously achieved operation without any lost time incident (Zero LTI), as acknowledged by the International Association of Drilling Contractors (IADC). Mexican delegation to study VN's garment, textile sector A delegation from the National Chamber of Textile Industry of Mexico (Canaintex) will visit Viet Nam from August 27 to 28 to explore the garment-textile sector. The delegation is scheduled to visit seven factories and an industrial zone to study the process of making fibre and apparel products. According to the Mexican chamber, the Trans Pacific Partnership agreement, once it takes effect, will allow Viet Nam to ship its garment and textile products to more markets, particularly the United States. Viet Nam is the second largest garment and textile supplier to the United States, while Mexico is the sixth largest supplier. Statistics show that Viet Nam shipped garment and textile products worth $11 billion to the United States last year. In the first half of this year, the figure hit $4.29 billion, up 5.93 per cent year-on-year. New version of anti-virus software provides anti-leak function The BKAV Technology Group officially launched last week its new anti-virus software BKAV 2016, which is equipped with new technology against information leak. The new version will comprehensively protect computer users against spyware attacks. In recent network attacks, a major problem was created when a victim's computer was hacked and controlled by spyware. According to BKAV research, hackers often send email containing a spyware virus and most users are infected. The anti-leak technology has been studied and developed by BKAV engineers for the last five years. It includes a package of smart technology against spy software like Safe Run, Anti Keylogger and HIPS. The price for the new version is still VND299,000 ($13.4) for one year for use. For those who have already paid, their software will be automatically upgraded.  Panama issues import permits to 17 local seafood exporters Panama’s Food Safety Authority (AUPSA) has issued import permits to 17 local seafood exporters who have met all of the qualifications to ship product to the Central American country. In making the announcement, Nguyen Nhu Tiep of the Ministry of Agriculture and Rural Development said a letter of request had been sent to AUPSA asking it to reveal the shortcomings of the Vietnamese companies who failed to pass the requirements. He said the request was made so that MARD could take corrective action to help the businesses who failed rectify the situation and get them up to speed and on Panama’s authorized import list. In addition, Mr Tiep, urged those businesses that were issued permits to get the word out by contacting their customers in Panama. He also advised them to promptly contact Panama’s quality control centres and get registered. ACB to offset deposit in GPBank through real estate The Asia Commercial Bank (ACB) is currently finalizing the paperwork for the transfer of real estate belonging to Global Petroleum Bank (GPBank) to offset its deposit of VND252 billion ($11.3 million) with the bank. Inter-bank deposits have been a problem for ACB in recent years. In seeking high interest rates it has suffered greatly, with the majority of its profit being eroded by huge risk provision for such deposits. ACB’s recent annual general meetings saw shareholders express concern over the bank’s ability to reclaim major deposits at banks that no longer formally exist and loans from six companies of the former Chairman Nguyen Duc Kien, known as “Mogul Kien”. During the period when Vietnam’s banking system was grappling with liquidity issues, banks with high charter capital such as ACB were chasing high interest rates through inter-bank deposits. Then GPBank and Construction Bank (CBBank), previously known as the Vietnam Construction Bank (VNCB), in which ACB had millions of dollars in deposits, were both acquired by the State Bank of Vietnam (SBV) for no payment. The deposits therefore became frozen and ate into ACB’s profits. It was reported on January 31, 2015 that SBV had acquired CBBank for no payment. ACB’s deposit of VND400 billion with CBBank has therefore been classified as uncollectible. On December 25, 2015, ACB sent Official Correspondence No. 7261 to the SBV, asking that the central bank approve adjustments to the maturity date of the deposit and funds on deposit. SBV then issued Official Correspondence No. 10005, which approved ACB’s deposit of VND400 billion ($17.94 million) with CBBank being paid annually with a maturity of September 30, 2020. As at the end of the second quarter, ACB’s total risk provision for the deposit with GPBank was reported at VND165.6 billion ($7.43 million), slightly down from VND176.1 billion ($7.9 million) at the end of 2015. ACB’s bad debt ratio fell from 1.31 per cent at the beginning of the year to 1.24 per cent as at the end of the second quarter. Despite the falling ratio, ACB’s bad debts by value reached VND3.37 trillion ($151.14 million) as at June 30, up VND455 billion ($20.4 million) compared to the end of 2015. Uncollectible debts as at June 30 were reported at VND1.34 trillion ($60.1 million), up 26 per cent compared to the start of the year. Its consolidated financial statement for the first half also pointed out deposits of VND772 billion ($34.6 million) with GPBank. ACB’s deposits were split into two parts. As at March 31, 2014, regarding the deposit of VND252 billion ($11.3 million), ACB signed an agreement to extend the maturity date for another 24 months, to September 4, 2016. On December 25, 2015, ACB sent Official Correspondence No. 7261 to SBV seeking the central bank’s approval of the transfer of GPBank’s bonds and real estate to ACB. This aimed at offsetting a deposit of VND252 billion ($11.3 million) and interest gained from the deposit. On December 29, 2015, SBV released Official Correspondence No. 10005 approving ACB’s request. On April 7 ACB received VND520 billion ($23.3 million) in bonds from a domestic joint stock company to offset its deposit of VND520 billion ($23.3 million) with GPBank. For the remaining VND252 billion ($11.3 million) to be offset, ACB is currently finalizing the paperwork to receive GPBank’s real estate. Acknowledging the concerns of shareholders, CEO Mr. Do Minh Toan told the 2016 annual general meeting that he was committed to turning these loss-making inter-bank deposits into profit-making assets. AEC to present opportunities and challenges in HR Hanoi event hears of the effects of the free movement of workers within ASEAN to come from the AEC. Vietnam’s labor market will become increasingly competitive with greater opportunities and challenges coming from the ASEAN Economic Community (AEC), Ms. Nguyen Van Anh, Managing Director of employment consultants Navigos Search, told the Talent Magnet networking event hosted by Career & Employability Services at RMIT Vietnam on August 16. “Free movement of workers within ASEAN will increase competition and the requirements for highly-skilled workers,” she said. The free movement of workers will bring greater opportunities to Vietnamese workers to find jobs in other countries while also giving employers more options in finding suitable employees if they are lacking in their home country. “If we can’t find a skilled nurse in Vietnam, for example, we can seek qualified candidates from the Philippines or elsewhere within ASEAN,” Ms. Van Anh said. As an experienced employer, she added that attitude determines success. “In a competitive working environment your attitude will make a huge difference and determine your success,” she said. “Young Vietnamese are hard working and can learn quickly,” Ms. Kelly Linh Nguyen, Marketing Manager at Uber Vietnam, told the gathering. “But they still lack a proactive approach. They should be more open and use their understanding in every project.” RMIT students networked at the event with industry representatives in a speed networking session and heard a panel discussion between Ms Van Anh, Ms. Nguyen, Dr. Achim Fock from the World Bank, and Ms. Nguyen Huyen Chau from RMIT Vietnam’s alumni and co-founder of School 4 Kids. First-year Bachelor of Business (Economics and Finance) student Ms. Nguyen Thi Hai Trang believes that expanding her professional network will benefit her studies now and help her succeed in the future. “The event provided me with the opportunity to learn how to introduce myself in the most impressive way and in a limited time,” she said. RMIT students at the event were able to practice how to impress future employers in just 45 seconds and learned how to sharpen their English language and other soft skills. HCMC leads country in real estate inventory The real estate inventory value of Vietnam nears VND36 trillion (US$1.62 billion) at present and Ho Chi Minh City takes the lead with VND6,599 billion ($296.32 million), according to the latest report by the Vietnam Real Estate Association. Nationwide inventory value dropped over 29 percent equivalent to VND14,931 billion compared to last December and VND1,530 billion against the end of June. Of these, housing land stock is the largest with about VND16 trillion, followed by low rises with VND9,890 billion, apartment buildings VND6,893 billion and commercial property VND3,255 billion. In HCMC, the inventory level reduced by VND3,500 billion over last yearend and VND216 billion versus the second quarter this year. The value was approximate VND5,823 billion ($261.47 million) in Hanoi. Opportunities narrowing for local household plastic products Vietnam’s household plastic industry has seen a deluge of high class and middle products by foreign rivals who have predominated with many advantages including modern technologies and diversified designs.  Having arrived in Vietnam since 2007-2008, South Korean Lock and Lock has quickly controlled the market with high ranking products. Its most popular item is food containers, a small segment which local businesses have paid little attention to. Grasping consumers’ demand of safety , the company has made high quality products and attained much success. So far, the company has had four large scale plants including a plastic plant in Dong Nai, which come into operation since 2009 over 70,000 square meters, a complex of three factories in Ba Ria-Vung Tau province producing heat resistant glass, pots and pans and plastic. Twenty percent of the plants’ output provides Vietnamese market and 80 percent are exported.  Vietnam now has about 20-30 medium and large plastic firms. Many of them have made efforts to improve competitiveness and take back the market share. For instance, they have changed from Chinese technologies and machines into Taiwanese (China), Indian and European products. Some large companies have stepped up studying and developing high class products, for instance, Sina anti-bacteria food containers by Dai Dong Tien Company have come onto the market.  Tan Lap Thanh has also launched Happy Lock food containers. However, they should diversify designs and increase spending on advertisement and marketing to get more success. In the low and middle segments, local businesses have experienced competitive pressure from Thailand. Thai products have been the favorites of many Vietnamese for high quality and reasonable prices. Besides, Thai firms have waited in front for the global trend of consuming eco-friendly products. Srithai Superwase PLC is one of Thai plastic giants that have been successful in Vietnam. From the initial number of US$4 million, its investment capital has increased to $20 million after 19 years. Besides three plants in Song Than industrial park, the southern province of Binh Duong, the company is doing land lease procedures to build others in the northern region. With the developing distribution and retail system in Vietnam, Thai plastic companies have a foundation to gradually overpower Vietnamese goods. This forces local firms to renovate technologies and improve their product quality, said chairman of the Vietnam Plastics Association Ho Duc Lam. Ms. Huynh Thi My, secretary general of the association, said that small firms have determined their segment in rural areas because of weak potential. Rural market does not require much in design but low prices. Household plastics is said a potential industry of Vietnam with consumption level having been increasing for years. The level averaged one kilogram a person in 1989 and increased to 22 kilograms in 2010 and 35 kilograms in 2013. Experts forecast that consumption will hike to 45 kilograms a person by 2020. Many local businesses want to develop their own products with high quality and diversified designs however they are short of funds. In addition, Vietnamese enterprises have to pay loan interest rate of 6-7 percent or even higher while it is only 1 percent or 0 percent in Thailand. Eighty percent of materials for the plastic industry depend on import now, making it difficult for local firms in competing with foreign rivals especially when there are exchange rate fluctuations. Therefore, local plastic enterprises hope that the Government should have preferential policies to provide them with low interest loans to produce more competitive products and develop support industry for the plastic industry to reduce the material dependence on import. Hau Giang to develop community-based ecotourism With historic interest and relatively undisturbed natural areas, the authority in the Mekong delta Province of Hau Giang is working on the plan to develop community-based ecotourism products.  Based on its rivers, fruit orchards, and rural sights and life, the Mekong Delta province is inclined to exploit ecotourism.  The province has an interlacing canal system with Nga Bay floating market, Ngoc Hoang Ecological Tourism area and special fruit – pineapple. Cau Duc pineapples, a brand name protected by the National Office of Intellectual Property, have been cultivated under the Vietnamese Good Agriculture Practice (VietGap) standards in Hau Giang Province. According to the province’s plan, tourists will enjoy home-stay in farmers who grow pineapple and then tourists can taste the special fruit and drive bicycles along countryside roads. Pineapple farmer Vuong Thanh Sim said that visitors will seat on a boat for sight-seeing of the fruit farm and then they will be instructed how to grow, cut and enjoy the fruit in the farm and catch fish in the canal.  One of the highlight of the tour in Hau Giang is a tour to Nga Bay Floating Market where visitors can see and take photos of local residents whose buying and selling busily in the market, a special feature of the Mekong delta region. Next, visitors will experience at 1,500 hectare Mua Xuan Farm which is home of variety of rare birds. Tourists can watch these birds from boats along canals in the natural and wild farm. To turn tourism industry one of the province’s key economy with excellent potential for growth, authority has built three-star hotels and is going to expand banking systems in order to facilitate visitors in paying services and improve traffic infrastructure to tourist interesting places. Tourism agents said that the home-stay tourism products at pineapple farmers and Mua Xuan Farm are very interesting and it is hoped to attract many visitors especially international tourists. Deputy head of the Department of Culture, Sports and Tourism Nguyen Duy Tan said that the department is implementing ecotourism projects with more services namely amateur music, handicrafts making and fishing. Additionally, the authority will provide training to farmers – playing as tour guides. Masan Group buys back 20 million treasury shares Masan Group Corporation announced a decision to buy back 20 million treasury shares in a strong business performance on August 18. According to Masan, the current trading price of its shares is much lower than their true value. The group owns and operates market leading platforms across the key sectors of Vietnam’s growing economy. As such, the group believes that the planned buyback is one of efficient ways to deploy some of its significant cash holdings and reflect Masan’s confidence in its strategic direction and financial outlook. The deal also reflects Masan’s commitment to increase and maximize its shareholders’ value and serve its diverse shareholder base. Besides the annoucement, the group also released a reviewed financial statement for the first half of 2016 by KPMG Company, confirming the record business performance growth disclosed at the end of July by Masan management. According to the financial statement, net revenue grew by 83.8% and net profit after tax and minority interest nearly tripled compared to the first half last year. Supported by strong double digit growth across all of its business segments, Masan is on track to achieve its US$2 billion net revenue target. Therefore, Masan has increased this year forecast of net profit after tax and minority interest by 25% to VND2,400 billion, reflecting a bottom-line growth of approximately 60% compared to 2015. Masan’s consolidated cash balance as of 30 June 2016 was VND12,863 billion, comprising cash, cash equivalents, short-term investments and other interest bearing assets. Masan Group Corporation is one of Vietnam’s largest companies. It has focused on domestic consumption opportunities and built leading businesses in branded food and beverage sector and animal nutrition value chain. Masan’s businesses include Masan Consumer Holdings, the producer of some of Vietnam’s most trusted and loved brands across many food and beverage categories (such as Chin-su, Nam Ngu, Tam Thai Tu, Omachi, Kokomi, Vinacafe, Wake-up, Vinh Hao and Su Tu Trang), and Masan Nutri-Science, Vietnam’s largest local animal protein company (with brands such as Proconco and ANCO). The Company’s other businesses include Masan Resources, one of the world’s largest producers of tungsten and strategic industrial minerals, and its associate, Techcombank, a leading joint stock commercial bank in Vietnam. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR