BUSINESS IN BRIEF 2/8
HCM City needs specific plans to maintain economic growth
Ho Chi Minh City needs to carry out specific plans to maintain its economic growth in the last four months of 2016, Chairman of the municipal People’s Committee Nguyen Thanh Phong said at a working session with local officials on August 1.
The city will focus on implementing the Government’s Resolution No.19 on improving business environment and increasing national competitiveness in 2016-2017 and with orientation towards 2020, and Resolution No.35 on supporting and developing businesses until 2020.
Particularly, the city moves to simplify administrative procedures and enhance the application of information technology in the field to make it easier for enterprises to do business.
Apart from increasing market management and preventing effectively trade frauds, the city will actively promote the campaign “Vietnamese people prioritise Vietnamese goods” and pay more attention to the retail market which is dominated by foreign partners.
In the long run, HCM City will concentrate to improving the municipal trade development scheme and upgrading the information system for farm produce in 2016-2020, while establishing a chemicals and aromatic spices business centre.
The city plans to speed up the implementation of urgent infrastructure projects in 2016, including the development of water supply network.
According to Director of the municipal Department of Planning and Investment Su Ngoc Anh, the total retail sales and services revenue reached nearly 407 trillion VND (18.31 billion USD) in the January-July, a year-on-year increase of 11.4 percent.
The export turnover was estimated at 17.6 billion USD in the period, a yearly rise of 1.8 percent. Meanwhile, the import turnover hit 20.7 billion USD, up 9.8 percent.
The industrial production index rose by 3.1 percent.
The city attracted 19 public-private partnership (PPP) projects with a total investment of over 34.8 trillion VND (1.56 billion USD) in the first seven months of 2016.
Quang Nam asked to boost sea-based economy
Deputy Prime Minister Truong Hoa Binh has urged central Quang Nam province to pay heed to promoting sea-based economy, focusing on providing credit support and vocational training for locals, increasing the number of fishing boats and considering possibilities of shipbuilding industry development.
In a recent working session with leaders of the locality, the deputy PM asked the local authorities to accelerate agricultural restructuring and new urban development, intensify application of sci-technology and expand production and business models that bringing high efficiency.
He also underlined the need for the locality to make a study of aquaculture in hydroelectric reservoirs, promote labour export, natural disaster and forest fire prevention, research and rescue, disease prevention and environmental protection.
Local authorities were requested to hasten the implementation and disbursement of investment projects, giving priority to key projects.
Administrative reform should be stepped up towards improving the provincial competitive index and the business climate, the Deputy PM said, adding that specific ways must be devised to foster start-up activities and lure more strategic investors to the locality.
He asked for sustainable development of hi-tech and support industries, and effective exploitation of popular tourism sites such as Hoi An Ancient Town, Cu Lao Cham Island, My Son Holy Land along with traditional trade villages and beaches in the locality.
Attentions should be also paid to issues concerning socio-culture development, education, health care, poverty reduction, social welfare, and policy for contributors to the national revolution, especially those in disadvantaged and mountainous areas.
Quang Nam enjoyed a stable GDP growth in the first six months of this year, hitting 11.7 percent. It posted year-on-year increases of 6 percent in export turnover, 12.4 percent in industrial production, and nearly 13 percent of total retail sales of consumer goods and services, in the period. The number of tourists to the province was up 23 percent over the same period last year.
Local authorities have taken many solutions to agricultural development and new-style area building, job generation and high-quality human resources training.
The province has 54 communes that have completed all 19 criteria of new rural areas . The rate of poor households under multidimensional poverty standards decreased to 12.9 percent.
However, Quang Nam is facing difficulties in rationalising labour structure, building new-style areas in mountainous areas, managing of natural recourses and minerals and preventing drug-related crimes.
State Treasury offloads 4.072 trillion VND worth of G-bond
The State Treasury has mobilised 4.072 trillion VND (182.62 million USD) through auction of government bonds, according to G-bond auction organiser Hanoi Stock Exchange (HNX).
The bonds included in an offered package of 6 trillion VND of G-bonds, including five-year bonds worth 3 trillion VND worth, seven-year bonds worth 1 trillionVND, 10-year bonds worth 1 trillion VND and 30-year term bonds amounting to 1 trillion VND.
Through the auction, 2.76 trillion VND of five-year bonds were offloaded at the coupon rate of 6.11 percent per annum, 0.01 percent higher than that in the previous auction.
Meanwhile, 400 billion VND of seven-year term bonds were sold at the coupon rate of 6.62 percent per annum, together with 912 billion VND of 30-year bonds at the rate of 8.00 percent per annum.
No 10-year term bonds were sold, said the HNX.
So far this year, the State Treasury has mobilised over 206.87 trillion VND from G-bond auctions at HNX.
Vietnamese firm looks to expand canned coconut water business
An ambitious Vietnamese company is developing a new coconut product with an eye on the international market.
There was a time when thirty liters of coconut water sold for VND5,000 (23 US cents), when it was seen as an inferior by-product from the processing of coconut meat, supposedly the most valuable part of a coconut.
But times are changing, at least according to Betrimex, a company based in the Mekong Delta province of Ben Tre, which is currently producing canned coconut water under the brand name Cocoxim.
The company has just invested US$20 million in building a factory for the production of its new product, and it is confident that canned coconut water will find success on the domestic market.
Despite the fact that coconuts can easily be found along the side of the road, canned coconut water is more convenient, as cans are easier to carry and require less effort to open compared to unwieldy coconuts.
Betrimex’s true ambition, however, is to conquer overseas markets, such as the US, Canada, and the EU.
The demand for canned coconut water is rising globally. World consumption in 2015 was double that of 2012, with canned coconut water now regarded as a premium drink in supermarkets.
In the US, sports drinks usually fetch around US$1.80 a liter, while canned coconut water is oftentimes priced at US$5 a liter.
Nguyen Minh Hoang, Betrimex’s vice president, believes that Vietnamese coconuts have a competitive edge over global competitors.
Coconut meat accounts for 35% of a Vietnamese coconut, while the world average is 30%.
Coconut water takes up 27% of a Vietnamese coconut, whereas the global average is 22%.
In addition, Vietnamese coconuts are considered sweeter than others.
With this in mind, Betrimex believes that it can succeed both domestically and internationally.
It remains to be seen whether the ambitious company will be able to achieve its goals.
Foreign firms keen on old building renovation projects in HCM City
Numerous foreign firms are interested in projects to renovate or replace old buildings in Ho Chi Minh City.
President of the Australian Property Sakkara Group Neil Wilson made the statement at a meeting with Secretary of the municipal Party Committee Dinh La Thang on August 1.
According to Wilson, firms which have been operating in Vietnam and the city are seeking investment opportunities in high building and transportation projects.
At the meeting with foreign investors in estate and finance including Sakkara, Dragon Capital of the UK and GIC of Singapore, Secretary Thang welcomed businesses to seek investment opportunities in the city.
He said HCM City has continuously created optimal conditions for investors.
The city is calling for investments in numerous projects in the fields of transportation, flood fighting, environment, construction and old building renovation, Thang said.
He suggested businesses with strength in finance and estate enter joint ventures to participate in the projects.
New firms surge in first 7 months
Some 64,000 enterprises were created in the first seven months of this year with a total registered capital of nearly VNĐ497 trillion (US$22.36 billion), according to statistics from the General Statistics Office.
Newly-established firms rose by 23.3 per cent in number and 54.7 per cent in capital value year-on-year. The adjusted capital in the reviewed period posted VNĐ894.9 trillion, raising the total registered and adjusted capital to 1,400 trillion.
More than 16,700 enterprises, which suspended their activities due to difficulties, have resumed operations, up 67.5 per cent from the same period last year. In July, the number of new firms exceeded 9,600 with a total registered capital of VNĐ69.2 trillion, a slight decrease from June. More than 99,200 jobs were also created by the newly-established enterprises. The number of businesses resuming operations exceeded 1,800 in July, while nearly 6,000 halted their operation and more than 900 firms completed procedures for dissolution or termination.
Director of the Central Institute for Economics Management Nguyễn Đình Cung said the average capital of a business in the period has still been small at VNĐ7.7 billion each. Of which, the average capital of private firm was VNĐ1.5 billion while that of joint stock company was VNĐ1.3 billion.
“The improvement of businesses’ competitiveness would not be easy as most of Vietnamese firms are small-and-medium sized enterprises,” Cung said, adding that small scale would make companies faced with difficulties of backward technologies, limited skilled labourers and a shortage of long-term business strategies.
He said businesses with average capital of less than VNĐ10 billion could be vulnerable in international integration.
Sectors and localities should have strong measures to improve the business environment, aiding firms’ difficulties as well as improving their competitiveness.
In addition, authorities should apply risk management and simplifying administrative procedures to reduce paperwork and shorten time for businesses in the import-export sector, he said.
The director added that the Government should revise and build a roadmap to reduce inequality between State-owned and private firms.
Đồng Nai farmers grow rambutan
Farmers in the southern province of Đồng Nai are growing Thai rambutan because of its high profit, according to the Đồng Nai Agriculture and Rural Development Department.
The department said Đồng Nai has 11,000ha of rambutan trees, making it the largest rambutan producer in Việt Nam. The total area for growing rambutan trees has not increased over the years, but the structure of the area has changed. The area for growing Thai rambutan has increased, while the area for Vietnamese rambutan has been reduced.
Lê Thị Lan, a farmer in Bình Lộc Commune, Đồng Nai Province, said her family grew 5ha of Vietnamese rambutan before 2014, but now she has cut down local rambutan trees on 3ha to grow Thai rambutan.
She said her family might grow Thai rambutan trees on the remaining 2ha in the future if the selling price of Thai rambutan remains high.
Currently, the wholesale price of Thai rambutan stands at VNĐ18,000 (US$0.8) per kilo, while the price of Vietnamese rambutan is between VNĐ5,000 and VNĐ15,000 per kilo depending on the kind of rambutan, according to Tin tức newspaper.
The demand for Thai rambutan has also increased recently, said Phùng Thanh Tâm, director of the Bình Lộc Agricultural, Service and Trade Cooperative in Bình Lộc Commune.
However, Thai rambutan prices have not been as stable as local rambutan prices. That is a great risk for local farmers, he said. In addition, the higher supply of Thai rambutan would drive down the selling price for the fruit.
The Đồng Nai Agriculture and Rural Development Department warned that farmers should be careful when switching from local rambutan trees to Thai rambutan. Local rambutan profits might not be as high as Thai rambutan profits, but Vietnamese rambutan trees have been developed in Đồng Nai for many years, and land and natural conditions are suitable for growing Vietnamese rambutan trees, the department said.
The department also echoed warnings about prices going down once more farmers switch to Thai rambutan crops.
In a related matter, Long Khánh rambutan received a geographical indication certificate in June, which would create more chances for local rambutan to enter new markets, the department said.
Vinh Phuc seeks partnerships with Czech Republic
Vinh Phuc authorities have assured enterprises from the Czech Republic of favourable conditions for them.
Chairman of the Vinh Phuc provincial People’s Committee Nguyen Van Tri was speaking at a recent workshop on investment opportunities in Vinh Phuc held in Prague, the Czech Republic on August 1.
He highlighted the local favourable business environment, saying that it offers comprehensive infrastructure, skilled worker training, simplified administrative procedures and low-cost land rent fee to foreign investors.
Vice President the Economic Chamber of the Czech Republic Borivoj Minar said a delegation of Czech firms plans to visit Vinh Phuc to expand cooperation.
Vice Chairman of the provincial People’s Committee Nguyen Kim Khai said the province ranked fourth in the provincial competitiveness index in Vietnam. It has lured 221 foreign investors with the total investment capital of 3.5 billion USD.
He expressed his hope that Czech firms will invest in mechanical manufacturing and supporting industry.
Meanwhile, Vietnamese Ambassador to the Czech Republic Truong Manh Son updated the development of friendship and economic cooperation between the two nations, while underlining Vietnam’s investment potential.
Earlier on July 31, the Vinh Phuc delegation, led by Tri, had a working with representatives from the Embassy of Vietnam, the Vietnamese People Association and Vietnam Business Association in the Czech Republic.
The provincial leader called on Vietnamese expats to invest more in the locality.
SeABank, BRG Group and Michinoku Bank sign agreement
Viet Nam's Southeast Asia Commercial Joint Stock Bank (SeABank) signed a trade co-operation agreement with Japan's BRG Group and Michinoku Bank on July 29.
Under the agreement, BRG Group and SeABank will co-operate with Michinoku Bank in exchanging information about society, culture, business and investment to support businesses involved in the export and import of agricultural and forest products and seafood.
SeABank will supply banking services as per customers' demand, such as cross-selling.
They will introduce reputed customers who expect to do business or invest in the other country.
BIDV's total assets' worth touches $41bn
The Bank for Investment and Development of Vietnam (BIDV) retained its position as the country's largest commercial bank in terms of assets, the bank's latest accumulated report said.
According to the report, BIDV's total assets as of the end of June rose 9.2 per cent against January to reach more than VND930 trillion (US$41.51 billion).
The bank's credit and investment also increased 8.3 per cent to reach VND876 trillion, while its capital mobilisation rose 13 per cent to touch VND868 trillion, helping the bank claim a market share of 12.8 per cent of the entire banking system's total capital mobilisation.
Thanks to the credit growth, BIDV's accumulated profits as of the end of June reached VND3.311 trillion, up 6.2 per cent year-on-year.
However, the bank's non-performing loans increased sharply by 31 per cent against the end of last year, or by more than VND3 trillion to reach VND13.183 trillion. Of these debts, potentially irrecoverable debts and doubtful debts rose from VND5.190 trillion and VND887.76 billion to VND6.343 trillion and VND2.326 trillion, respectively.
The bank, however, controlled its total bad debts under two per cent as required by the central bank.
Tien Sa Port eyes world-class status
The Da Nang Port JSC started the second phase of a project to expand Tien Sa Port on July 31, to make it a modern container port in the central region.
When it is completed at an estimated cost of nearly 1.1 trillion VND (49.3 million USD) by June 2018, Tien Sa Port is expected to be able to handle 70,000 DWT vessels and 10 million tonnes of cargo a year.
The expansion project will cover an area of 60,000sq.m, raising the port’s total area to about 31ha. In addition, two new piers, measuring 310m and 210m in length, will be constructed for docking container ships. It will be equipped with two cranes and synchronous infrastructure to ensure effective use of the port.
The project has drawn the attention of the people after the port’s management board decided not to use Official Development Assistance (ODA) funds for the port and mobilised capital themselves.
The smooth and effective operation of the port’s first phase has made the authorities confident of arranging investment themselves for the upgrade project. On the other hand, the rising value of the Japanese yen has caused difficulties for the payment of the first phase’s loan and its interest rate. In addition, the large scale of the project, with several categories, could prolong its implementation if the port uses the ODA loan. These are the reasons why mobilisation of capital by the company can reduce the total investment and debt payment pressure in the long term.
Nguyen Huu Sia, the company’s general director, said the company had raised 36 percent of the total investment themselves, borrowing 31 percent and mobilising 33 percent from shareholders, instead of using the ODA to minimise risks and stay active in financial plans. In the financial mobilisation process, DA Nang Port has received commitments and supports from Vietnam National Shipping Lines (Vinalines), investment funds and big banks for the project’s investment.
Sia said with an increasing amount of goods being handled at the port, the payback period was expected to be 10 years, instead of 14-15 years in other similar projects.
He added the upgrade project is extremely vital as the increasing quantity of goods going through the port has reached an overload level.
Statistics from the company showed that in the first half of the year, the port handled 146,000 TEUs (20-foot equivalent unit), posting a 19 percent year-on-year increase. Notably, the number of containers handled at the port reached record levels. In just May and June, the loading capacity reached the highest level of 29,431 TEUs.
Huynh Duc Tho, Chairman of the Da Nang city People’s Committee, said the port could handle up to 10 million tonnes of goods a year.
“The second phase of the project will play an important role in the city’s transport development master plan by the year 2020 with orientation towards 2030. It would also be suitable with the marine development strategy of Vietnam in general and Da Nang in particular,” Tho said.
He said the project faced some difficulties relating to land procedures and environment impacts in the initial period. However, they have quickly overcome the difficulties with the support of the transport ministry, the people’s committee and relevant agencies as well as available infrastructure.
The port is designed to handle 14 million tonnes of cargo, including 800,000 TEUs (twenty-foot equivalent unit), by 2025.As scheduled, Tien Sa Port will be built as a ‘valley’ of logistics, warehouse, transport and digital customer clearance services, besides having representative offices of shipping companies and banks. The port, established in 1976, has operated as a limited company under the ownership of the Vietnam National Shipping Lines (Vinalines) since 2008 before becoming a joint stock company in the middle of 2014.
According to Vietnam’s seaport system development plan towards 2020, Da Nang Port has been confirmed as a major commercial port in the region, making it one of the key gateways to the East Sea from the sub-Mekong region.
It handles cargo communication and encourages economic development and tourism in Vietnam’s central provinces and the Central Highlands, southern Laos and northeast Thailand via the East-West Economic Corridor.
Last year, Da Nang’s ports handled a record 6.5 million tonnes of cargo, and hosted nearly 120,000 tourists disembarking from cruises.
The Da Nang Port JSC also plans to develop Lien Chieu Port to ease congestion at the overloaded Tien Sa Port.
Vietnam’s industrial production up 7.2 percent
Vietnam’s index of industrial production (IIP) in the first seven months of this year rose 7.2 percent year-on-year, the General Statistics Office (GSO) announced.
The growth rate was lower than the 10 percent registered during the same period last year.
The processing and manufacturing sector, which accounts for more than 70 percent of the total value of the industrial sector, grew 9.9 percent in the first seven months, electricity production and distribution saw an increase of 11.6 percent, while the mineral industry decreased 2.7 percent.
Economists from GSO said the low growth rate was due to the decline in product consumption as the consumption index in June increased by only 0.7 percent over May, while May’s consumption index grew 5.2 percent over April.
Industrial products saw high growth, such as television which rose 79 percent, rolled steel grew 23.5 percent, automobiles increased 22 percent and animal feed jumped 19.7 percent, besides cement that rose 15.7 percent and liquefied petroleum gas (LPG) by 14.8 percent.
Meanwhile, industrial output of motorbikes and leather and footwear fell 1.2 percent and 1.3 percent, respectively, while sugar, crude oil and mobile phones declined 5.5 percent, 6.8 percent and 8.5 percent, respectively.
According to GSO, the capacity for improvement in industrial production in the rest of this year was limited as the average inventory rate in the first six months was 70 percent, declining only 1.5 percent compared to the previous five months.
Provinces where the IIP saw high growth were Binh Duong at 8.5 percent; Dong Nai at eight percent; Hai Phong at 16 percent; and Da Nang at 11.5 percent; besides Bac Ninh at 9.7 percent; HCM City at 7.1 percent; and Hanoi at 6.8 percent.
The southern region’s industrial production expanded by 7.5 percent year-on-year in the first half of this year, according to a report by the Ministry of Industry and Trade.
Retail sales and services were worth 922 trillion VND (41.9 billion USD), an increase of 6 percent.
The region’s exports were worth 43.8 billion USD, an increase of 11 percent.
This year the manufacturing and trading sectors set themselves targets of maintaining higher industrial growth than the national average and retail and services revenues of 89 billion USD, or 13.6 percent higher than last year.
The export targeted is 98.8 billion USD, an increase of 14.2 percent.
The figures were tabled at a conference organised by Binh Duong Province’s Department of Industry and Trade last week on speeding up administrative reforms and strengthening connectivity and cooperation for integration and development.
The conference was attended by Deputy Minister of Industry and Trade Do Thang Hai and the leaders of the 20 provinces and cities in the south.
Officials from HCM City’s Department of Industry and Trade have urged southern provinces and cities to help sell 100,000 tonnes of salt produced by farmers in its coastal district of Can Gio.
Pham Thanh Kien, the director of the department said at the conference that the city faces a challenge in finding buyers.
In the recent salt season 140,000 tonnes were harvested in Can Gio but only 40,000 tonnes were sold to wholesalers.
To sell salt and other stockpiled items, there should be cooperation between provinces and cities in the region, he said.
Da Nang asked to use ODA effectively
Deputy Prime Minister and Foreign Minister Pham Binh Minh has urged the central city of Da Nang to use official development assistance (ODA) sources effectively as those with low interest rates will end next year.
At a working session with the municipal leaders on July 30, the Deputy PM said the Government plans to build a mechanism to manage and use ODA sources more effectively, which will require payment responsibility and solvency of localities.
He stressed that projects using ODA capital must ensure requirements on efficiency and solvency, especially when the ODA loans account for 26 percent of the total public debt and 15 percent of GDP, and it becomes scarcer after Vietnam joins the group of medium-income nations.
Minh praised Da Nang for its efforts to attract ODA projects and ensure their progress, contributing to the city’s socio-economic development.
The city also recorded the high ODA disbursement rate of over 30 percent, 10-12 percent higher than the country’s average level.
According to the municipal People’s Committee, Da Nang implemented 13 ODA projects worth over 700 million USD in the 2011-2015 period, helping the city improve infrastructure, water supply, health care, and information technology facilities.
At the working session, the city’s asked ministries and sectors to further support Da Nang in connecting with and calling on potential investors to pour money into priority fields such as precise mechanics, biotechnology, and IT.
Deputy PM Minh promised that he will instruct the Foreign Ministry to assisting the city in attracting foreign investment and promoting tourism.
Regarding preparations for the 25th APEC Summit to be held in Da Nang in 2017, the Deputy PM urged the municipal authorities to swiftly design a master plan for the event, towards taking the occasion to introduce the city’s potential and strengths and promote trade and investment links.
Largest woodchip processing factory in Phu Yen starts operation
The largest woodchip processing factory for export in the south central province of Phu Yen was officially put into operation at Dong Bac Song Cau Industrial Park on July 31.
The 36,000-sqm factory was built by a local private enterprise at a total cost of 100 billion VND.
According to Tran Dang Khoa, Director of Bao Chau Private Enterprise, the project is set to produce 100,000 tonnes of woodchip annually, with a designed capacity of 36 tonnes per hour, during its first phase.
It will then switch to manufacture 100,000 tonnes of wood pellets in 2017 for export to the Republic of Korea, the US and the EU, he said.
The company has a 2,000-hectare material area to feed the factory. It has worked with the National Economics University, Bureau Veritas and RoK-based Dongseo University and Kangwon National University to study new wood processing technologies.
Lotte Mart opens store in Nha Trang
Republic of Korea (RoK) retailer Lotte Mart has recently opened a shopping mall in Nha Trang city, the central coastal province of Khanh Hoa, its 13th in Vietnam.
Situated on 23/10 Street, Lotte Mart Nha Trang has a supermarket, a luxury mall, restaurants and fast-food shops, and an entertainment area.
The supermarket sells more than 30,000 items, including fresh and dried foods, household utensils, fashion products and cosmetics.
It has amenities like currency exchange, free wifi, free delivery and others.
To mark the opening, Lotte is offering attractive discounts.
At the opening ceremony, it made a donation of 50 million VND (2,242 USD) to the Khanh Hoa province Social Welfare Centre.
Lotte, which came to Vietnam in 2008, plans to have 60 stores nationwide by 2020.
FLC Quy Nhon opens, hoped to give boost to local tourism
The FLC Quy Nhon resort complex was inaugurated by the FLC Group in Nhon Ly commune, the central province of Binh Dinh on July 30.
Speaking at the opening ceremony, Chairman of the provincial People’s Committee Ho Quoc Dung said the opening of the complex will give a great boost to local tourism industry and provide jobs for thousands of local residents, contributing to the socio-economic development of the province in the coming years.
The 1,300-hectare complex includes a 36-hole golf course, 1,500-room luxury resort, a marine eco-tourism area, a luxury hotel, a zoo and a 1,500-seat international convention centre.
FLC Quy Nhon’s golf course, or Golf Links, is regarded as one of the three most beautiful golf courses in Asia.
The FLC Group has also been constructing a 1.7-hectare hotel complex, FLC Sea Tower Quy Nhon, in An Duong Vuong street, down town Quy Nhon city at a total cost of 2.3 trillion VND, raising its combined investment in Binh Dinh to over 7 trillion VND, or 11.1 million USD.
The twin tower includes a 25-storey building with a 7-star hotel, a shopping mall and an entertainment area.
Japanese locality strengthens cooperation with Vietnam
Businesses in the Japanese Prefecture of Aomori are interested in seeking opportunities in Vietnam, said Mimura Shingo, Governor of the prefecture.
The governor made the remark during a meeting with Vietnamese Ambassador to Japan Nguyen Quoc Cuong who paid a working visit to the Japanese locality from July 25-28.
At the meeting, the two sides discussed measures to boost cooperation between Aomori and Vietnamese localities, especially in agriculture, commercial exchange, aquatic products, human resource training and tourism.
Governor Shingo expressed his hope that he will lead a delegation of enterprises to visit Vietnam in a near future.
Also on the working trip, Ambassador Cuong participated in a seminar on Vietnam’s economy held by the Aomori Chuo Gakuin University.
At the event, which attracted the participation of about 350 local leaders and leading businesses, the ambassador presented a speech highlighting Vietnam’s orientations on socioeconomic development as well as possible cooperation opportunities between Vietnam and Japan in the coming years.
He also had a working session with the university’s authorities and interacted with nearly 60 Vietnamese students who are studying at the university.
Located in the northernmost of Honshu island, Aomori has a population of 1.3 million people. Its annual Gross Domestic Products reaches about 45 billion USD.
The prefecture yields the largest apple output in Japan.
Last year, Vietnam officially granted certificates to allow apples from Aomori to enter the country.
Businesses honoured on HOSE’s 16th aniversary
The Top 50 Best Annual Reports of listed companies on Vietnam’s two stock exchanges were honoured during a ceremony held on July 29 to celebrate the 16th anniversary of the HOSE, which began operation in July 2000.
The Top Ten winners of the Vietnam Annual Report Awards, organised by the HCM Stock Exchange, Vietnam Investment Review and Dragon Capital Group include Bao Viet Holding (BVH), DHG Pharmaceutical JSC, Pan Pacific Corp., FPT, HCM Securities Corp., Bao Viet Securities Co., Vingroup JSC, Century Synthetic Fibre Corp., Vicostone JSC and PetroVietnam Drilling & Well Services Corp.
BVH also won the Outstanding Award thanks to its excellent content and presentation.
DHG won First Prize, followed by BVH and VNM with second and third prize for the Best Corporate Governance Section.
BVH also received First Prize for Sustainability Reporting while second went to DHG.
All 50 winners received the best reports out of 136 finalists, who were selected from 600 eligible reports of listed companies. In the winners’ list, 34 reports belong to firms listed on the HOSE and 16 on the HNX.
The HCM Stock Exchange became operational in 2000 with two listed firms and to date the number has grown to 309. In its 16th operational year, daily trading value has reached almost 2.4 trillion VND (105 million USD) and its market capitalisation represents 28 percent of the country’s GDP.
More than 253,000 billion VND were raised through auctions of State-owned enterprises that sell shares to become joint stock companies and new share issues.
The exchange is expected to complete all necessary conditions in 2017 to put the covered warrant product into play, which is already in use in 42 out of 56 members of the World Federation of Exchanges (WFE), to which HOSE is a member, says the exchange’s chairman Tran Dac Sinh.
HCM City workshop seeks to promote sales
Measures and strategies to increase the sales abroad and in the domestic market were the focus of a seminar held by the Business Studies and Assistance (BSA) centre and the Business Association of High Quality Vietnamese Products in Ho Chi Minh City on July 29.
According to Tran Thai Ha, a representative from the market research firm Nielsen Vietnam , the Vietnam's Consumer Confidence Index (CCI) raised again in late 2015, standing at 108-109 points, while the retail growth was slowed down, reaching between 8-9 percent.
Additionally, the fast - moving consumer goods (FMCG) in big cities recorded slight growth, up about 3 percent in the first half of 2015 and 5 percent in the same period of 2016.
Participants heard that producers are meeting with many challenges in selling their products in the remaining months of this year.
CEO and General Director of the Bich Chi Food JSC Pham Thanh Binh said enterprises should pay attention to region-based goods distribution, especially in the New Year festival, because people in each region have different shopping habits in the occasion.
Producers were recommended to take more promotional campaigns and after-sales services in order to attract retailers and consumers.
Authorities of the southern province of Binh Duong met more than 90 enterprises from the Republic of Korea operating in the locality to update them of the province’s socio-economic situation and investment attraction policies, and listen to their feedback and proposals.
Tran Thanh Liem, Chairman of the provincial People’s Committee, said that in the coming time, Binh Duong will continue improving its investment environment, enhancing its competitiveness and increasing supports for investors.
The province will mobilise various available resources to complete its infrastructure system, including transportation, water and energy supply, and environmental protection system, while expanding industrial parks and strengthening human resources training, he said.
Liem underscored the provincial government’s commitments to speeding up administrative reform to ensure procedures are transparent and simple, and developing high-quality services to meet investors’ production and business demands as well as its urban industry growth.
Binh Duong vows to ensure social security, safety and order, he added.
During the meeting, representatives from the RoK Business Association and RoK enterprises in the province voiced obstacles facing them, including a lack of international schools for their children, the slow reply of some departments and agencies to their questions, and the difficulty and high cost of transportation.
According to Nguyen Thanh Truc, Director of the provincial Planning and Investment Department, Binh Duong has so far attracted 2,713 foreign-invested projects with a total capital of around 25 billion USD.
The province has nearly fulfilled the yearly target of FDI attraction, he said, adding that a total of over 1.14 billion in FDI has been licensed for 126 new and 68 underway projects in the first half, a rise of over 12.5 percent year on year.
The RoK is currently the third largest investor in Binh Duong with 569 projects totalling 2.25 billion USD. In the first six months of this year, RoK investors have invested in 27 new projects and added 155.2 billion USD in 13 underway projects in the locality.
HCM City hopes for new wave of Malaysian investment
Ho Chi Minh City hopes to welcome a new wave of Malaysian investors, especially following the formation of the ASEAN Community and the conclusion of the Trans-Pacific Partnership (TPP).
Le Thanh Liem, Vice Chairman of the municipal People’s Committee, made the remark when he received a delegation from Malaysia’s Consulate General in HCM City on July 29.
He affirmed the city’s determination and efforts to simplify administrative procedures and improve the investment climate in order to provide the best conditions for foreign businesses, including those from Malaysia, to operate in the locality.
Sofia Akmalabd, Malaysian Consul General, said Vietnam and Malaysia see great potential for cooperation as they are members of the TPP and the ASEAN Community.
Malaysia and HCM City need closer links to boost their trade and investment in the future, he noted.
As of June 2016, Malaysia was the second largest investor in HCM City with 220 valid projects capitalized at 5 billion USD.
Malaysian investors mainly pour money into such sectors as processing, manufacturing, trade, accommodation and restaurant services.
Thua Thien-Hue aims to become fashion industry hub
The central Thua Thien-Hue Province plans to spend more than VND6.6 trillion (US$295 million) on transforming itself into a textile and garment hub in the country's central region.
This is the main objective of the province's textile and garment planning for the 2016-2020 period.
Under the plan, the province will focus on developing the domestic market and expanding export markets, with exports being a driving force for the sector's development; boosting research, product design, brand-building and promotion; and developing a professional fashion industry to change the rural labour structure.
Chairman of the provincial people's committee Nguyen Van Cao said in order to develop the sector sustainably and ensure enough supply of materials for production, the province had co-operated with the Centre's co-ordinating board of key economic zones to build a centre for supplying apparel materials.
The centre would cover 400ha in the Phong Dien Industrial Zone, he said.
Highly appreciative of the project, many textile and garment companies located in the zone such as Huayang and Thailand's Freetex Elastic companies had expressed their willingness to expand their factories, Cao said.
In addition, to create a closed production chain, the province is also conducting research of modern wastewater treatment systems to protect the environment.
Due to dependence on materials supplied by partners, local textiles and garment companies had lost their competitiveness and the sector's efficiency had also been affected, Cao said.
That's why in the near future, companies would be urged to transfer their production from a processing model to ODM (original design manufacturing) or OMB (original brand manufacturing) model, he said.
The province is now home to six industrial zones, with 50 textiles and garment enterprises.
Gas price cut on August 1
The retail price of a 12kg cooking gas canister was reduced by VND4,500 (US$0.2) to fall from VND250,000 to VND255,000 in southern cities and provinces on August 1.
In an announcement, local gas distributors said the new gas prices had been conveyed to all agents, businesses and customers in HCM City and other southern cities and provinces.
Tran Van Phuc, head of Saigon Petro's business section said the average price of gas in the world market was announced to be US$287.5 per tonne, a $15 cut compared with the price in July. That's why the domestic gas price has been revised to conform to the market change and to ensure customers' rights and interests.
The price of gas has continuously fallen in the last two months, with the total reduction amounting to nearly VND20,000, thanks to price cuts in the world market.
Businesses told to prepare for Tet
To boost sales at the peak shopping season for Tet (Lunar New Year), Vietnamese enterprises need to pay more attention to customer demand in each region in order to map out proper production and distribution plans, delegates told a seminar in HCM City on Friday.
Tran Thai Ha, a representative from the market research firm Nielsen Viet Nam, said the most-mentioned products during Tet include beer, beverages, coffee, and confectionaries. But the demand was different in each region in the period.
For instance, during last Tet, sales of beer and beverages increased significantly compared to normal time in the south, but in the north, beer and beverages sales slightly reduced, while demand for confectionary went up strongly, she said.
Firms usually release their Tet products in early November, but with the 2017 Tet falling on January 28, earlier than in previous years, businesses should prepare commodities for Tet early, she said.
Besides, to increase sales during peak season, firms should make efforts to bring their products into retail stores and launch promotional programmes.
Despite the Viet Nam economy showing signs of slowing, its retail sales growth has remained high, she said.
She also shared the top five factors that influence custome decisions over where to buy products. They are availability, quality, location, store personnel and product assortment.
More and more Vietnamese shoppers look for products with healthy ingredients, she said, adding that this is a good opportunity for retailers to boost sales of these products.
Delegates at the seminar also shared their experience in penetrating overseas markets.
Nguyen Dang Hien, general director of Tan Quang Minh Manufacture and Trading Co Ltd (Bidrico), said by participating in trade fairs held in Myanmar's big cities, his company found local distributors to distribute its products.
Bridico chose to penetrate the modern trade channels first, by selling its products at a supermarket there, where Myanmar consumers give priority to go for shopping, before distributing its products in the traditional channels, he said.
Philip Zerillo from the Singapore Management University said finding a proper distributor is the most important factor in helping businesses distribute their products abroad. Businesses should find distributors that give them insights in the local market, so they know how to adapt their pricing and products, he said.
Pham Thanh Binh, chairman and general director of Bich Chi Food JSC, said 10 years ago, his company only sold in the domestic market, but its earning from exports currently account for 66 per cent of its total revenue, with its processed farm produce available in all ASEAN countries.
To succeed in overseas markets, firms must conduct market research to develop suitable products for the target markets, he said.
Shops launch pre-school sales
As a new school year is just around the corner, many supermarkets and bookstores have launched major promotions designed to increase sales of stationery and other school supplies.
For instance, Co.opMart and Co.opXtra supermarkets nationwide are offering sharp discounts on more than 1,000 items, including student uniforms, school bags, notebooks, pens and other school supplies until August 7.
School student uniforms such as white shirts, blue trousers and skirts have an average discount of 35 per cent.
White notebooks, school bags, shoes, and many kinds of school supplies of familiar brands like Sanding, Viettien, Novelty, SGC, Biti's, Bita's. Miti, Thien Long and others have their prices discounted by up to 50 per cent.
Big C is also running a discount programme called "Hanh trang den truong" until August 8, with discounts between 15 per cent to 42 per cent applied on more than 880 items, including school student uniforms, footwear, notebooks, school bags, and desk lamps, of which many are new models.
In addition to discounts on prices, the programme will also apply "buy two get one free" to certain items such as notebooks and notebook covers.
Since the middle of this year, Lotte Mart supermarkets have launched attractive discounts on products serving the upcoming academic year.
School uniforms are discounted by 15 per cent, while pen, ruler, backpack, notebook, pencil and other school items are discount at over 30 per cent.
Many bookstores in HCM City, including Thang Long, Nguyen Van Cu, and Fahasa, are offering 10 per cent to 15 per cent discounts on textbooks, notebooks, pen and other items.
As in previous years, HCM City is carrying out a price stabilisation programme for school equipment, which will go on until March 2017.
School equipment suppliers have been told to increase supply by 15 per cent to 30 per cent to meet market demand.
The programme has attracted the participation of 15 enterprises, which registered to stabilise the price of 28 million notebooks, 1.369 million school bags and backpacks, and 320,000 pairs of shoes.
Tran Ba Dung, deputy director of Huong Mi Trading Production Co Ltd, told Viet Nam News that his company was assigned to offer stablised prices on 600,000 backpacks and schoolbags.
The company has developed many new models this year, including terrain backpacks (which are easy to pull up stairs) and anti-hunchback shaping backpacks, he said.
Besides providing products under the city's price stabilisation programme, the company has also supplied products to other provinces and cities nationwide, he said.
Its wholesales volume sold to Co.opMart supermarket chain, Fahasa and PNC bookstores and first-level agents increased by 15 per cent over the same period last year, he said.
Tran Van Tac, director of Tuan Viet Shoes Co Ltd, said the company expects to sell 60,000 products in the 2016-17 school year.
Duong Chi Thanh, general director of Vinh Tien Joint Stock Company, one of the largest manufacturers of high quality student notebooks and stationery in Viet Nam, said the company has prepared 20 per cent more notebooks to serve this school year, of which 40 per cent will be sold in the price stabilisation programme.