BUSINESS IN BRIEF 27/10 Mekong Delta eyes market-driven agriculture The Mekong Connect - CEO Forum 2016 with the theme of “Seeking chances in challenges – Facing Climate Change, Environmental Risks and Integration Concerns,” took place in the Mekong Delta city of Can Tho on October 26, focusing on a market-driven agriculture.  According to Deputy Minister of Science and Technology Tran Van Tung, the Mekong Delta region needs to switch to sustainable production and consumption and integrate into global supply chains. In order to do that, the region needs quality products that meet the requirements of both domestic and foreign markets, and the tool to achieve it is to apply science and technology into production, Tung said.  He also called for promoting the startup spirit among young people.  Economist Pham Chi Lan said exhausted land and water resources, disasters and epidemics, a highly volatile market and low investment have hindered the development of agriculture.  Lan lined out several solutions such as forming large-scale production models and long-term links between farmers and agricultural businesses, and developing value chains and modern distribution systems for agriculture.  It is time to develop a market-driven agriculture and green production models that can adapt to climate change and changes on the market, she said.  According to Dr. Le Anh Tuan from the Can Tho University, the Mekong Delta is likely to bear the brunt of climate change and rising sea level that would threaten large areas of land for rice farming, fruit trees cultivation and aquaculture.  Participants said in order to deal with the problems, more information sharing and data collection and analysis are needed to seek appropriate and effective solutions. Sunwah Kingsway partners with Saigon Asset Management Hong Kong’s Sunwah Group, through its subsidiary the Sunwah Vietnam Investment Company (SVIC), announced further investment totaling $100 million in Vietnam at a ceremony held on October 25 in Ho Chi Minh City. The Sunwah Kingsway Vietnam Company (SKV), a joint venture between Sunwah Kingsway Capital Holdings Limited and the Saigon Asset Management Corporation (SAM), has also been established to provide investment services to Vietnamese enterprises, in which Sunwah Kingsway holds 60 per cent. SKV represents SVIC in managing equity of $100 million in Vietnam. The joint venture links the human resources and professionalism of Sunwah Kingsway as well as the Sunwah Group with the strengths and investment track record of SAM. SVIC will distribute the investment capital in the Sunwah Group’s strategic fields, including $30 million in food and beverages, $30 million or more, depending on each project, in real estate, $20 million in e-commerce, media, education, healthcare, and green technology, and $20 million in startups. “In most cases SVIC prefers opportunities in the expansion stage, where the company or project is seeking strategic capital to further grow their business,” said Mr. Louis Nguyen, CEO of SKV and SAM. “The objective of SVIC is to leverage the Sunwah brand, expertise and resources to invest and create sustainable value.” “Because of the long-term on-the-ground experience and conglomerate nature of the Sunwah Group we offer the flexibility to invest in a wide array of asset classes, including private equity, listed equities, and real estate. We look forward to working with entrepreneurs and capitalizing on this new upswing cycle of Vietnam.” In regards to the exit strategy, SVIC invests and assists companies with plans for an initial public offering (IPO) at the Hong Kong Stock Exchange or other international markets. Investment scale has not exceeded 20 per cent of net equity and is at a minimum of $100,000. Potential companies must have minimum turnover of $2 million and minimum profit margin of 20 per cent. “We have invested in excess of $1 billion in Vietnam and have seen positive developments over our 45 years in the rapidly growing country,” Mr. Johnson Choi, Executive Director of the Sunwah Group and General Director of Sunwah Vietnam, told the ceremony. “With the latest changes in government leadership and policies and the rising tide of investment opportunities, adding this $100 million validates our long-term commitment to Vietnam.” The Sunwah Group is a private conglomerate operating in seafood and foodstuffs, real estate, financial services, technology, media and infrastructure businesses worldwide. Founded in 1990 and listed on the Hong Kong Stock Exchange since 2000, Sunwah Kingsway has developed into a leading local brokerage firm and respected middle market financial services provider. It offers services in corporate finance, institutional sales, trading, brokerage, and proprietary investments. SAM is a Vietnamese fund management and private equity firm based in Ho Chi Minh City. It is the investment manager of Vietnam Equity Holding (VEH) and Vietnam Property Holding (VPH), two leading Vietnam-focused investment funds listed on the Stuttgart Stock Exchange. HCM City, Japan’s Nagano prefecture boost economic ties Ho Chi Minh City and Nagano Prefecture of Japan need to boost economic ties for their development, agreed the two sides’ leaders at a meeting in Vietnam’s southern economic hub on October 26. The city has worked closely with ministries and departments as well as localities and businesses of Japan, said Nguyen Thanh Phong Chairman of the municipal People’s Committee. He highlighted Nagano’s strength in technology, supporting industry and high-tech agricultural production while voicing his support for an initiative to sign a cooperation agreement between two localities. He also expressed his hope that both sides will discuss cooperation mechanisms in those areas after the current visit by Nagano Governor Shuichi Abe. Nagano’s businesses would like to cooperate with Vietnam in general and Ho Chi Minh City in particular, especially in agriculture and manufacturing industry, affirmed Shuichi Abe at the meeting. Nagano Prefecture is willing to support and transfer high-tech agricultural production technologies to the city, contributing to enhancing quality and effectiveness of agricultural products, he added. Shuichi Abe thanked the municipal authorities for offering incentives to Nagano’s enterprises operating in Ho Chi Minh City, adding the visit will be a milestone in the two localities’ relations. Tax agencies told to scrutinize firms with capital transfers Local tax authorities are asked to immediately check those enterprises involved in transfers of capital, brands and projects, those which have not been examined for years, those with a high tax risk, and those enjoying tax refunds. The General Department of Taxation believes this is one of the solutions that could help accomplish the heavy task of inspection in 2016, according to Dispatch 4800/TCT-TTr released on October 17. The general tax department requests local tax agencies to review the inspection plans and missions that have been approved. Those businesses showing the above signs should be inspected in the rest of this year. Besides, local tax authorities should further strengthen post-refund inspections. In particular, all records on the advance refund cases in which input value-added tax arising after at least 12 months has not been deducted should be inquired. Besides, enterprises with large tax refunds or signs of risk that have been investigated before refunds should be comprehensively checked within this year. In addition, local tax agencies should pay attention to those businesses active in land transfer, real estate trading, mining, telecommunications, electrical, electronics, automotive, dairy, pharmaceutical, wholesale and retail sectors. By the end of this September, the tax industry had looked into more than 55,700 enterprises and around 673,400 tax declarations. Thanks to this, an additional VND9.2 trillion had been collected and some VND4.8 trillion had gone to the State budget, according to data of the General Department of Taxation. The tax authority’s target is 18% of the currently active enterprises should be checked in 2016. The General Department of Taxation said that in the first nine months of the year, many local tax departments trailed behind their inspection and examination plans, such as Hanoi, Binh Dinh, Lam Dong, Can Tho and Long An. Besides, multiple tax agencies like Phu Tho, Thanh Hoa and Quang Tri did carry out inspections and examinations but their efficiency was below expectations, said the General Department of Taxation. Many tax authorities are criticized for not stepping up the collection of tax arrears via inspection and tightening examination, resulting in lower-than-expected State budget revenues. ODA loans seen costlier from 2017 The debt repayment period for official development assistance (ODA) loans taken out by Vietnam will be cut by half while their interest rates will rise to 3.5% per year from July next year, according to the Ministry of Finance. The ministry told a press conference in Hanoi on October 25 that Vietnam could no longer expect cheap ODA loans from July 2017. The time for debt repayment will be shortened by half and interest rates will edge up to between 2% and 3.5% per year as Vietnam has become a middle-income economy since 2010. Incentives offered by international donors have been significantly cut since 2010. In the past, the nation could get loans with a term of as long as 30-40 years and an annual interest rate of a slight 0.7-0.8%. However, international donors cut the lending term to 10-25 years and increased interest rates to some 2% in the 2011-2015 period. Many donors shifted from ODA to mixed loans. Vietnam paid more than VND36.6 trillion in foreign debts in January-September this year. Hoang Hai, deputy head of the ministry’s Department of Debt Management and External Finance, said pressure from debt repayments would be bigger while new loans will carry higher interest rates and shorter tenors.  The ministry said Vietnam will have to consider and restructure its debts and find ways to use loans more efficiently.  Preferential and ODA loans reached some US$45 billion in the 2005-2015 period. ODA loans were largely used for building infrastructure, balancing the State budget, and developing the healthcare, education and training sectors.   Hai said management of foreign loans, especially ODA, must be strengthened in the coming time. According to the Government’s Directive 02/CT-TTg, public loans must be used for development projects and major construction works in line with zoning plans. The Government will lend to provinces and cities and reduce allocations for them.   The Ministry of Finance has issued Circular 111/2016/TT-BTC to guide the implementation of the directive to ensure the efficient use of ODA loans and strict management of this source of capital. Shipping route from Vietnam to Netherlands in the pipeline A first round-table conference between the Netherlands and Vietnam on aviation and maritime development was held in Hanoi this Monday, where the two sides committed to opening a direct shipping route between the two nations. Dutch Vice Minister for Foreign Trade Marten van den Berg said the Netherlands is strong in the maritime and shipbuilding industries. Thus, the two nations need to expand cooperation in the maritime sector. The two sides discussed the opening of direct shipping lines from Vietnam to the Netherlands. Deputy Minister of Transport Nguyen Nhat threw his support, suggesting opening a direct route from the Cai Mep-Thi Vai port complex in Ba Ria-Vung Tau Province to the Netherlands. Nhat added Vietnam held strong growth potential in the shipbuilding industry, so it needed expertise from the Netherlands. The Damen-Cam River shipyard, a 42 hectare joint venture between the Netherlands and Vietnam, has been faring well. Regarding aviation, the Civil Aviation Administration of Vietnam (CAAV) said at the event that Vietnam’s aviation industry has gained double-digit growth in passenger and freight transport in recent years, despite the impact of the global financial crisis. Especially, 2015 saw a significant passenger growth rate of over 22%, prompting the International Air Transport Association (IATA) to project Vietnam as the world’s third fastest growing aviation market. E-commerce management discussed Cross-border e-commerce management should be integrated and synchronous to ensure equality and transparency, said Phan Duc Hieu, deputy director of the Central Institute for Economic Management (CIEM). Hieu told a conference on management policies on cross-border e-commerce services held in Ha Noi yesterday that management should clarify the essence of e-commerce transaction floors. The conference aimed to discuss how to regulate websites and applications providing cross-border e-commerce services. "Investors in foreign countries have more advantages than local firms. Therefore, State management agencies should have solutions to ensure equality, order and transparency while not restricting business activities," he added. In recent years, Viet Nam has seen the a rapid boom of companies specialising in e-commerce, especially in Ha Noi and HCM City. The two cities have highest turnover of online advertisement and shopping in the country. However, tax collection from the e-commerce businesses has not been equal to real turnover. Tax agencies in the cities found and collected several hundreds billion dong of tax evasion from e-commerce firms after investigations. Tax agencies have faced difficulties in clarifying turnover, costs and incomes on e-commerce activities to manage the tax collection in comparison with traditional firms. Experts also discussed tax policy, specifically the difference between electronic tax payment and tax exemption for the e-commerce businesses. Nguyen Thi Cuc, former director of the General Taxation Department and chairwoman of Tax Consultancy Association, said management and investigations in cross-border e-commerce sectors have seen challenges, requiring a more complicated process than normal firms. Cuc said investigations and check-ups need support from credit organisations and relevant agencies to define payment flows. He added that the process should impliment transaction numbers as a foundation for determining tax arrears. Earlier this week, a seminar on ‘Fulfilment of Services' was told that express delivery and fulfilment services do not yet meet the requirements of the fast developing e-commerce sector in Viet Nam. The Viet Nam E-Commerce Association (VECOM) organised the seminar in Ha Noi to connect express delivery companies with e-commerce firms. Luong Tu Anh, Director of Mat Bao Corporation, said at least 24.9 per cent of online purchasers complain about express delivery services while 48 per cent of clients refuse to buy goods from e-commerce business, citing late delivery as the reason. VECOM Chairman Nguyen Thanh Hung said a survey carried out by the Ministry of Industry and Trade showed that of the 50 million estimated internet users in the country, about three-quarters shop online. Clearly, that reflects the great potential that e-commerce has in Viet Nam. However, Hung underlined that the e-commerce sector as of now was experiencing great difficulty in meeting buyers' expectations. Many customers had returned products as these were delivered too late, and customers were by that time no more interested in them. Hung said express delivery and fulfilment services act as catalysts for the development of e-commerce. Hung said express delivery services did not keep pace with the e-commerce trend, leading to a large ratio of consumers being dissatisfied with the quality of the services. Han Van Loi, director of Boxme, said in Thailand, 99 per cent of Kerry Express's purchase orders were delivered on time. Compared to it, in Viet Nam, average purchase orders were handed over to buyers after five to seven days, and at times even after 10-15 days. At the moment, very few e-commerce companies were using inventory management system in a professional manner and many businesses ended up losing goods without knowing about it. Actually, when making a delivery, e-commerce businesses often resort to methods such as using their employees or hiring shippers. They want to hire shippers from professional delivery companies to cut their transport costs and expense on human training and to minimise risks involved in delivery. Foreign direct investment companies in Viet Nam have plans to rent human resources from other companies, said Anh. According to Hung, e-commerce companies should do their best by coming up with ideas and implementing technology applications and waiting just till online buyers decide to click that basket of goods. Once that happens, these companies should try their level best to outsource by hiring services from different companies such as warehouse, packing, shipping and other related services. However, he noted that if they rent all the services, they may fail to do business at all. E-commerce businesses should be smart enough to decide what components they needed to rent in order to use resources in the most effective way. Currently, some businesses have been shifting traditional delivery services to fulfilment services, including delivery, packing and shipping. However, e-commerce companies should be fully aware of the risks, including disputes, damaged goods and counterfeit goods, to take appropriate steps, said Hung.  Amcham organises supplier day in city The American Chamber of Commerce, HCM City Chapter on October 26 organised the Supplier Day 2016 for FDI manufacturers and local suppliers aiming at the growth of the Viet Nam supply chain. More than 60 enterprises, including Walmart, participated in the event where they discussed manufacturers' needs and requirements and how suppliers can meet those needs. Around 140 appointments were conducted, compared to 100 carried out at last year's event. "As suppliers, you need to invest in training and education, improve quality and manufacturing standards and increase efficiency to remain competitive and become innovative suppliers," said Frank Weiand, general director of the company Supply Chain Services International. Lee Hoang Dan, Indochina procurement manager of Coca Cola, said: "We prioritise suppliers that have female CEOs and managing directors and employ a large number of female workers as well as the disabled." Milton D. Hagler, general director of BriskHeat Vietnam, said he appreciated the advantage for manufacturers to have local suppliers. "The ability to contact suppliers within the same time zone is invaluable as it is easier to communicate and have face-to-face meetings if desired," he said, adding that it offers lower delivery costs and easier site visits. Samsung offers new technologies at VIMS 2016 Samsung is introducing its latest mobile phone technologies and applications of the Galaxy S7 and S7 edge and the Galaxy ecosystem at the five-day Viet Nam International Motoshow 2016 (VIMS). Samsung is participating at the VIMS, which started on Wednesday at the Sai Gon Exhibition and Convention Centre in HCM City. Visitors can experience Samsung products such as camera Gear 360, virtual reality Gear VR and Gear Fit2 smart watch. Galaxy S7 and S7 edge have recorded high sales in the high-end market segment in Viet Nam. Samsung's Galaxy sale in the first nine months of the year grew by 32 per cent from the same period last year.  Samsung is also offering gifts to visitors at the event.  New eco-tourism resort for Quang Ngai The central province of Quang Ngai has approved a VND810 billion ($36.8 million) investment project from the QH Construction Investment Joint Stock Company to build the Ca Dam eco-tourism resort. Located in Tra Bui commune, Tra Bong district, the resort covers 1,300 ha and will include a tourism area, an eco-resort, a leisure tourism area, residential subdivisions and a public tourism area. Mr. Nguyen Van from the Quang Ngai Department of Planning and Investment told VET that QH Construction Investment has not implemented the project on the schedule proposed so was unable to reveal the beginning and completion of construction. Ca Dam Mountain is one among 12 destinations in Quang Ngai bordered by the mountainous districts of Son Ha, Tra Bong and Son Tay. The potential of the local area remains largely untapped. To develop the tourism project atop Ca Dam Mountain, Quang Ngai authorities have decided to build two roads linking it with Tra Bong district and a road from Di Lang town, with total capital of VND30 billion ($1.3 million). The Chairman of the Tra Bong District People’s Committee said the road will be completed next year. Meanwhile, many investors are seeking investment opportunities in tourism infrastructure on the province’s Ly Son Island. Projects include the Cau Cave resort, a sea tourism area in An Hai commune, a marine tourism area in An Vinh commne, the Mu Cu marine tourism area, a high-class tourism and service area on Be Island, and the An Vinh Urban and Service Area. According to figures from the local Department of Culture, Sports and Tourism, in the first six months of this year Quang Ngai welcomed 420,000 tourists, up 16 per cent year-on-year. The province also attracted eight new investment projects in the first six months with total registered capital of VND588 billion ($26.7 million) while disbursed capital totaled VND1.2 billion ($56 million), according to the Quang Ngai Department of Planning and Investment. Vietrade & Korea Institute of Design Promotion sign MoU The Vietnam Trade Promotion Agency (Vietrade) and the Korea Institute of Design Promotion (KIDP) signed a memorandum of understanding (MoU) on expanding cooperative activities to support Vietnam’s design industry, at the Vietnam International Conference on Creative Industry (VDS 2016) held by Vietrade and KIDP on October 26. KIDP will support Vietrade in establishing and operating a design center in 2017. It will provide training and boost design consultancy for Vietnamese enterprises and improve added value in Vietnamese products and services in the international market. Experts at the conference discussed the current status of product design for tourism in Vietnam. “Vietnam’s design and creative industry, especially for tourism, remains modest and lags behind other countries in ASEAN and in the world,” Deputy Minister of Industry and Trade Cao Quoc Hung told the gathering. Vietnamese products and services are of good quality but investment has not been made carefully in creative design, which is an important step that brings added value to products. VDS 2016 aimed to discuss opportunities between organizations, enterprises and designers, suggest activities and effective solutions for the country’s design and creative industry, and promote cooperation between Vietnam and the region’s design industry. Mr. Dang Kong Ngoan, Vice President of the Vietnam Design Association (VDAS), told the conference that designing for tourism is being developed and local enterprises have seen success. Enterprises and organizations working in sample design and art creation are deeply involved in not only designing goods and gift products but also services (hairdressing, massage, and beauty treatment), as well as the packaging and marketing of interior design. Although there are various tourism products and services, visitors often cannot distinguish specific products by region because most are similar at different tourist attractions. “The greatest difficulty for Vietnam’s tourism products relates to models,” Mr. Vu Hy Thieu, an expert in Vietnamese handicrafts, told VET. Artisans are proficient but limited to making similar products, none of which cater specifically to tourists. Handicrafts depend on tradition and can be bulky, which makes them unpopular with many tourists. He suggested the tourism sector cooperate with traditional handicraft villages to improve product ideas and for authorities to organize short training courses and design contests. The conference was attended by the Chairman of KIDP Jung Young Bin, Director of the Trade Promotion Department under MoIT Bui Huy Son, and more than 30 delegates from international promotion organizations within ASEAN. “Tourism is an important sector contributing significantly to the economy and job creation in ASEAN, so it is necessary to focus on producing tourism products,” Mr. Bin said on the sidelines of the conference. “Workshops and conferences such as VDS 2016 offer opportunities for the design and creative industry in ASEAN.” Vietnam has actively participated in cooperative programs and exchange programs in the creative industry in ASEAN and in the world to promote its design industry, especially the Asia Design Sharing Program instigated by South Korea. Vietrade has also deployed various activities in improving the design ability of enterprises, including workshops, training courses, and design consultancy. It aims to further support enterprises to develop brands, improve designs, and establish links between designers and enterprises. Vietnam and South Korea have long had fruitful relations and trade is on the increase, with the Vietnam - South Korea FTA having come into effect on December 20, 2015. City leaders work with Korean investor on wastewater treatment plant Deputy Chairman of the Ho Chi Minh City People’s Committee Le Van Khoa and authorized agencies yesterday worked with Korea Water Resources Corporation (K-water) on a project to build Tan Hoa-Lo Gom wastewater treatment plant. At the meeting, Mr. Khoa said that Tan Hoa-Lo Gom is an important project to treat wastewater and protect the environment which the city will find the best investors to build. Mr. Khoa said that HCMC welcomes two Korean firms including K-water and Hanwha Engineering and Construction Company who have proposed to carry out the project. Previously, the municipal authorities had signed with them a Memorandum of Understanding (MoU) to set up a project to build the plant under Public-Private-Partnership (PPP) form. The city People’s Committee has asked them to submit the project to it by the end of December this year. It is expected that the plant will be built over 22 hectares with the total capital of US$200 million not including site clearance and compensation costs. Capacity will reach 300,000 cubic meters of wastewater a day. The project includes three major categories a pumping station at the end of Tan Hoa-Lo Gom Canal near Vo Van Kiet street, 12.4 kilometers of pipes along the street and National Highway 1A and the treatment plant in Tan Nhut commune, Binh Chanh district. After being built, the plant will handle the entire wastewater volume in the canal valley. At present, wastewater there is collected and released directly into Tau Hu-Ben Nghe Canal. HCMC needs up to 12 wastewater treatment plants but only two have come into operation including Binh Hung with the capacity to treat 141,000 cubic meters a day and Binh Hung Hoa with 30,000 cubic meters a day. HCMC budget collections edge up Budget collections from domestic sources neared VND145.3 trillion in January-September in HCMC, up 10.12% from a year earlier, according to a report on the city’s budget revenues in the nine-month period. Notably, districts reported around VND45 trillion in budget revenue, a 40% year-on-year pickup.  The city government attributed the increases to the improving performance of businesses as industrial production expanded 7.2% and export turnover climbed 7.45% versus last year’s same period. Besides, revenues from special consumption tax edged up 31%, mainly on wine, beer and tobacco that make up over 80% of the total sum of this tax revenue. Tax payments by a number of enterprises rose in the nine-month period, such as Mercedes Benz Vietnam Co Ltd, Heineken Vietnam Brewery, Nova Homes Trading JSC and Tan Lien Phat Construction Investment Corporation. Revenues from corporate income tax rose almost 17%. The city also collected taxes on brand and capital transfer deals from New Life Real Estate Company, Kido Corporation, Saigon VRG Investment Holding Corporation and Saigon Boulevard Co Ltd.          The city government said environmental protection, water and land tax revenues shot up over 70%, in addition to a rise in collections of tax arrears.  Overall, HCMC’s budget revenues reached VND219.14 trillion in January-September, up 10.2% year-on-year and meeting 73.46% of the 2016 estimate. HCMC Chairman Nguyen Thanh Phong told a meeting between the working group of the Prime Minister and the city government last week that the municipal budget revenues were expected to reach VND310 trillion this year, higher than the planned VND298 trillion. The city has been assigned to collect VND370 trillion next year. International motor show features 150 car models More than 150 auto models of 16 brands are on display at the second Vietnam International Motor Show (VIMS 2016) that opened in Ho Chi Minh City on October 26.  These brands range from luxuries like Bentley, Lamborghini and BMW to affordable ones such as Nissan, Suzuki and Ud Trucks.  The presence of Ulyanovsky Avtomobilny Zavod (UAZ) – a Russia’s familiar brand with outstanding features and new functions – is expected to impress car lovers and mark the return of UAZ to the Vietnamese market.  Lasting through October 30, the event also features hundreds of pavilions showcasing car components, spare parts and accessories as well as relevant financial and banking services.  General Director of the official Audi importer in Vietnam Laurent Genet said the scale of this year exhibition is much more impressive than the previous one, adding that only approximately 50 car models from nine brands were displayed last year.  In 2015, Vietnam’s automobile market set a record with 245,000 units sold, according to the Vietnam Automobile Manufacturer's Association (VAMA).  In the first half of 2016, nearly 126,800 cars were sold on the Vietnamese market, a 31 percent year-on-year increase.  VAMA expects that automobile sales for 2016 will reach 260,000 units, a year-on-year rise of 10 percent. RoK builds 31 mln USD animal feed factory in Ha Nam CJ Vina Agri Co., Ltd. of the Republic of Korea (RoK) on October 26 kicked off construction of an animal feed factory in the northern province of Ha Nam.  The factory, CJ Vina Agri’s fifth one in Vietnam, covers 7.5 hectares in the Dong Van II Industrial Park in Duy Tien district. It has a total investment capital of 31 million USD and a capacity of 330,000 tonnes per year.  Vu Dai Thang, Vice Chairman of the provincial People’s Committee, said that the factory will contribute to the development of animal husbandry in Ha Nam and Vietnam in general.  He asked the RoK company to ensure the progress of the project as well as pay attention to the life of workers.  He also instructed relevant units to do their utmost to create favourble conditions for investors, including CJ Vina Agri. Amcham organises supplier day in city The American Chamber of Commerce, HCM City Chapter on October 26 organised the Supplier Day 2016 for FDI manufacturers and local suppliers aiming at the growth of the Viet Nam supply chain. More than 60 enterprises, including Walmart, participated in the event where they discussed manufacturers' needs and requirements and how suppliers can meet those needs. Around 140 appointments were conducted, compared to 100 carried out at last year's event. "As suppliers, you need to invest in training and education, improve quality and manufacturing standards and increase efficiency to remain competitive and become innovative suppliers," said Frank Weiand, general director of the company Supply Chain Services International. Lee Hoang Dan, Indochina procurement manager of Coca Cola, said: "We prioritise suppliers that have female CEOs and managing directors and employ a large number of female workers as well as the disabled." Milton D. Hagler, general director of BriskHeat Vietnam, said he appreciated the advantage for manufacturers to have local suppliers. "The ability to contact suppliers within the same time zone is invaluable as it is easier to communicate and have face-to-face meetings if desired," he said, adding that it offers lower delivery costs and easier site visits.  PV GAS joins LNG Viet Nam The decision to become a major shareholder in Viet Nam Liquid Natural Gas JSC (LNG Viet Nam) was announced by Petrol Vietnam Gas (PV Gas) on October 25, 2016. The decision stated that the amount of capital issued by PV Gas will be VND51 billion (US$2.28 million), which would entitle PV Gas to 51 per cent charter capital ownership of LNG Viet Nam. PV Gas is currently the largest shareholder of LNG Viet Nam, followed by Viet Nam's BITEXCO Corp, which owns 39 per cent of charter capital, and Japan's Tokyo Gas Asia, which owns 10.5 per cent. LNG Viet Nam operates in the liquid natural gas value chain, including export and import, distribution, ownership and operation of warehouse and storage facilities. PV Gas regards the establishment of LNG Viet Nam as an important turn, marking the next step in the progress and modernisation of PV Gas and a way forward to approach the world gas market. LNG Viet Nam completed the business registration process and began operations from August 1, 2016. Agro-forestry-fishery exports reach 26.4 billion USD The export value of agro-forestry-fishery products in the first ten months of this year reached 26.4 billion USD, a year-on-year increase of 6.3 percent, according to the Ministry of Agriculture and Rural Development.  In October alone, the export value is estimated at 2.75 billion USD.  The country earned 164 million USD from the shipment of 368,000 tonnes of rice in October, bringing the total value and volume of the key staple for ten months to 1.9 million USD and 4.2 million tonnes, respectively.  During the January-October period, coffee exports 2.76 billion USD from 1.5 million tonnes, up 25.4 percent in value and 40.2 percent in volume. Exports of pepper reached 1.29 billion USD from 159,000 tonnes, while cashew brought home 2.33 billion USD.  Seafood exports saw a year-on-year increase of 5.9 percent to 5.7 billion USD while forestry products fetched 5.8 billion USD, up 0.1 percent. Vietnam to keep only 190 state-owned enterprises The number of 100 percent state capital enterprises will reduce to 190 ones in the phase of 2016-2020, said Mr. Nguyen Trong Dung, deputy head of the Central Steering Board for Enterprise Reform and Development on October 25. As of October 1 this year, the country has 718 enterprises which the state holds 100 percent chartered capital, he said. At a conference on state capital withdrawal and stock market listing hosted by HCMC Stock Exchange (Hose), Mr. Dung said that the Government has determined state enterprise equitization to be one of significant measures and key missions of economic restructuring. According to plan in the phase of 2016-2020, operating fields of state owned enterprises will reduce from 19 as present to 12 covering public postal service, lottery trade, money printing, gold bullion making and air traffic service. The 190 enterprises will comprise 63 lottery companies, 12 publishing and 87 irrigation exploitation firms. Enterprises that have been equitized but the state still holds 65 percent chartered capital will drop to four operating in five fields. Vietnam has implemented equitization for 24 years and created strong boosts for the development of businesses and the economy. Mr. Dung said that there are two types of state capital withdrawal now. The first type is to divest from non-core fields by economic groups and state corporations in fields securities, banking and real estate. The second type is to continue selling state shares at equitized enterprises. Regulations challenging enterprises to be removed The burden of energy labelling to meet the minimum energy proficiency standards certification in Vietnam is likely to be removed in order to cut administrative procedures. The move would make life easier for thousands of local manufacturers and foreign importers. The Ministry of Industry and Trade (MoIT) announced that it would soon nullify the requirement for enterprises to obtain energy label certification for customs clearance, after four years of this troublesome practice. This development is a part of the ministry’s administrative reform efforts after it recently removed Circular 37 on the limits and inspection of content of formaldehyde and aromatic amines derived from azo colorants in textile products. Minister of Industry and Trade Tran Tuan Anh requested the General Department of Energy to review the legal basis of the rules on energy labelling certification as well as the related procedures in order to cut time and achieve more transparency. Under the MoIT’s Circular No.07/2012/TT-BCT enacted in April 2012, in order to certify energy labelling and minimum energy proficiency standards (MEPS), manufacturers and importers must have product samples tested at laboratories appointed by the MoIT. According to current regulations, before being marketed in Vietnam, thousands of products, such as refrigerators, printers, and light bulbs, have to be tested for MEPS and obtain an energy label. The  testing results granted by the appointed testing organisations with a period of not exceeding six months from date of issue according to the circular. The firms complained that the insufficient number of eligible testing centres in the country have prolonged testing times and raised costs for enterprises. Currently, there are only six authorised testing centres across the country, and each one is only eligible to test a certain group of products. A nationwide survey conducted by the USAID Governance for Inclusive Growth Program shows that the time needed for testing a product varies from several days to several months. The Ministry of Planning and Investment and the American Chamber of Commerce in Vietnam (AmCham) earlier sent written objection to the MoIT’s contested circular. AmCham suggested that the MEPS requirement on certification by an accredited domestic test labs should be waived for globally well-known brands or for advanced technologies. Most electric manufacturers, such as Apple, Dell, Canon, Sony, HP, and Samsung, already apply international energy efficiency standards. Their products are tested by internationally-recognised laboratories before they are circulated on the market. “Therefore, testing these products again for energy labelling is redundant and unnecessary, especially with the limited capacity and resources in Vietnam,” the document stated. Rice exports hit US$1.9 billion Vietnam exported 368,000 tons of rice in October to get US$164 million, bringing the total rice export volume for 10 months leading up to November to 4.2 million tons with a value of US$1.9 billion, down 21.2% in volume and 16.9% in value against the corresponding period last year. According to the Ministry of Agriculture and Rural Development, Vietnam had to lower the export target from more than 6 million tons to 5.7 million tons, however, it is very difficult to reach the target. This is the first time since 2009 that the country’s rice exports dropped to below 6 million tons. The average export price in nine months was US$449 per ton, up 4.8% over the same period last year. China remained the largest importer of Vietnam rice with 35.4% of market shares. Vietnam shipped 1.35 million tons of rice to China to earn US$613.8 million in the first nine months of this year, down 23% in volume and 13.9% in value. Rice exports to many other markets like the Philippines, Malaysia, Singapore, the US and Ivory Coast also dipped sharply. However, exports to Ghana saw a strong growth of 36% (making up 11% of the country’s total exports). Indonesia ranked fourth among importers of Vietnam rice with 8.2% of market shares. Vietnam exported 359,400 tons to the market to get US$142.5 million, up 21.5 times in volume and 22.5% in value against the same period last year. Philips Lighting to build smart lighting system in Binh Duong The Netherlands’ Philips Lighting will work with the Investment and Industrial Development Corporation (Becamex IDC) to implement a cooperation agreement on sustainable lighting and turn Binh Duong city into a smart city.  Under the agreement, Philips Lighting will install 2,000 sets of energy-efficient LED lights on some streets in Binh Duong.  Nguyen Van Hung, general director of Becamex IDC, said Binh Duong has been working with partners with leading technologies and human resources to make Binh Duong a smart and livable place.  Eric Benedetti, general director of Philips Lighting Vietnam, said Philips Lighting pledged to build smart cities to bring high life quality to citizens and make life convenient for businesses.  The two sides agreed on a deal between Philips Lighting and the Eastern International University to build a laboratory on lighting science and teach lighting science at the university. Cultural economy brings regional benefits Cultural products generate 3 percent of global GDP and 29.5 million jobs per year, according to participants of a regional conference on culture and global integration in Hanoi on October 25.  Opening the conference, Deputy Minister of Culture, Sports and Tourism Dang Thi Bich Lien lauded the International Organisation of the Francophonie (OIF) for organising the event.  According to her, Vietnam issued a resolution on cultural development in 2014, which mentioned building a morally strong cultural market and narrowing the gap in consumption of cultural products.  In September 2016, a cultural economics development strategy for 2016-2020 was released with roadmaps to boost the growth of various sectors, including advertising, architecture, games, film and fashion.  OIF Director for Asia-Pacific Eric Normand Thibeault said his agency is working to stimulate cooperation with OIF members, particularly Vietnam.  The event offers opportunities for policy makers and cultural experts to exchange experience in the business in their respective countries.  It runs through October 27 with further discussion on global challenges to cultural economics and UNESCO conventions on the protection of cultural diversity, among other topics. VN firms told to learn about UN convention on sales contracts Vietnamese businesses should study the United Nations Convention on Contracts for the International Sale of Goods to boost exports and reduce uncertainty related to export contracts, a seminar heard in HCM City yesterday. Dr Nguyễn Minh Hằng, dean of the Foreign Trade University’s law faculty, said the CISG provides an equitable and uniform framework for sales contracts, which are the backbone of international trade in all countries, irrespective of their legal tradition or level of economic development. The convention will take effect for Việt Nam on January 1 next year. Hằng said the CISG established a comprehensive legal code for contracts for the international sales of goods, the obligations of the buyer and seller, remedies for breach of contract and others. Often, contracts signed between Vietnamese and foreign firms do not stipulate jurisdiction, meaning, in case of disputes, there are disagreements over which law would prevail, she said. The convention would also benefit Vietnamese firms by reducing legal expenses for consulting on foreign law, helping resolve disputes quickly, reducing the risk of conflict and boosting trade with CISG partners by enhancing confidence, she said. The convention has 85 member countries who account for two thirds of international trade, and most countries that have trade ties with Việt Nam have signed up, according to Hằng. There are many free sources of data about the CISG available on the internet, and Vietnamese exporters should take advantage, she said. At the seminar, Nguyễn Trung Nam of EPLegal Company spoke about drafting a contract with a focus on product quality, quality inspection, sanctions and arbitration.  Châu Việt Bắc, deputy general secretary of the Việt Nam International Arbitration Centre, said business groups could apply CISG to create a sample of contract to help their members handle the risk of disputes while implementing sales contracts. Organised by the Việt Nam International Arbitration Centre in collaboration with the Investment and Trade Promotion Centre of HCM City and the Foreign Trade University, the seminar attracted more than 200 business executives, members of business groups and others. Signed in Austria in 1980, the CISG is a project by the United Nations Commission on International Trade Law. The self-executing treaty aims to reduce obstacles to international trade, particularly those associated with law issues, by creating even-handed and modern substantive rules governing the rights and obligations of parties to international sales contracts.  VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR