BUSINESS IN BRIEF 24/12 Banks will have to buy more Government bonds         Banks participating in auctions of Government bonds will be under obligation to buy a minimum of VND4.5 trillion (US$200 million) in total from November 1, 2016 to October 31, 2017, according to the latest draft decision by the Ministry of Finance. In the previous period, the minimum value of Government bonds that branches of foreign banks had to buy was VND3 trillion and VND4.3 trillion for State-owned, joint stock, joint venture and wholly foreign-owned commercial banks. With this adjustment, the number of bidders joining the auctions this year was expected to reduce from 24 to 22. The obligation of securities companies joining these auctions was the same as the previous period in the draft, at VND2 trillion. Bidders must ensure that at least 70 per cent of the minimum amount of bonds they have to buy are of a maturity term from five years. In addition, they must participate in at least 60 per cent of the total number of auctions. Late in May, the State Bank issued a circular which raised the ratio of investments in Governments bonds to short-term capitals of branches of foreign banks from 15 per cent to 35 per cent and State commercial banks from 15 per cent to 25 per cent, which pushed up demand for Government bonds. Statistics showed that around 80 per cent of the bonds were bought by commercial banks. As of December 7, the State treasury raised more than VND280 trillion from auctioning Government bonds, fulfilling the goal for the full year. HDBank to give cheap loans to Mon Bay buyers      As the sole mortgage provider for the Mon Bay project in Quang Ninh, the Housing Development Commercial Joint Stock Bank (HDBank) has set aside VND2.73 trillion (US$119.7 million) for people to buy apartments and houses there. The bank will offer mortgages at 0-7.5 per cent interest for the first six months. The loans, of up to 70 per cent of the cost, have a tenor of up to 30 years. Located in Ha Long City, Mon Bay has a total of 1,444 apartments, nearly 1,000 of them in two 35-storey towers. The first phase will also see 197 semi-detached houses delivered to customers in the fourth quarter of next year.  First bank announces Tet bonus      Techcombank is the first bank to announce a Tet (Lunar New Year) bonus for its employees, amounting to up to seven months of their salary. Techcombank said all its employees would also receive a 13th month’s salary. In addition, each staff member would be given a bonus equivalent to 1.5-6 months’ salary, depending on their unit’s business results and each employee’s personal achievements. Techcombank’s managing board said in the first nine months of the year, its after-tax profit rose by 89.5 per cent from the same period last year to VND2.29 trillion (US$101 million). By the end of September, its total assets were VND222.7 trillion, up 16 per cent from last year. Its total loan outstanding balance was VND135.6 trillion, or a 21.5 per cent increase. The bank’s deposit mobilisation was also 15 per cent higher, reaching VND163.5 trillion. Techcombank is the second largest earner among joint stock banks, following VPBank. It held the top position in return on asset, which was at 1.47 per cent, while return on equity (ROE) was 17 per cent. The bank said it was Techcombank’s positive business results that were responsible for the Tet bonus for its employees. Phung Quang Hung, Techcombank’s head of Sales and Distribution Division, said the bank focused on retail banking as it believed retail profits would be higher than that of wholesale banking. Its retail banking department has some 5,000 employees, accounting for 70 per cent of the bank’s total employees. Its annual labour productivity was VND450-500 million per employee, and it was listed among the top banks in term of productivity. Techcombank held the second position in terms of spending through visa card this year. In addition, the bank improved risk management and resolving of bad debts, thus minimising costs. Int’l officials praise SBV      Representatives of international credit and finance organisations praised Viet Nam’s monetary policy and efforts to help the nation maintain macro-economic stability this year. They spoke at a year-end meeting at the State Bank of Viet Nam headquarters in Ha Noi on Monday, reported Thoi bao Ngan hang (the Banking Times). Ousmane Dione, the World Bank Country Director for Viet Nam, said the central bank significantly contributed to stability and growth of the economy, and many countries would like to reach an economic growth rate of around 6 per cent that Viet Nam achieved. HSBC Chief Executive Officer Pham Hong Hai said the central bank had effectively run the foreign exchange market in a proactive manner in 2016, despite global instability. Hai said global and regional economies witnessed various fluctuations this year, such as the sharp depreciation of the Chinese yuan at the beginning of the year, and a British vote to exit the European Union last June. “The SBV was right to change the way it manages exchange rates by setting a reference rate every day from the beginning of 2016, enabling the foreign currency market to operate flexibly following market rules. This helped the banking system avoid shocks involved in exchange rates,” he said. Interest rates were also stable this year, helping enterprises reduce loan costs and support healthy economic growth. Money supplies were cautiously managed, supporting a national policy of curbing inflation, he added. Hai also praised the central bank for its continuous efforts to restructure the banking system. “Of course it’s not easy to pursue this way, yet it is vital for sustained development of the banking area in particular, and the economy in general,” he said.  SBV Governor Le Minh Hung said the central bank had already completed plans to reorganise the banking sector over the next five years, focusing on handling non-performing loans and fragile credit institutions. The plans also call for adjusting the Law on Credit Institutions, proposing more international standards in local institutions to boost transparency for more healthy and secure development. Hung said the SBV acknowledged the policy advice of international organisations such as the World Bank (WB), International Monetary Fund and Asian Development Bank (ADB) that contributed to Viet Nam’s accelerated reforms. “I believe that more active participation by you (foreign institutions) in this process will benefit us all,” he said. Prime Minister Nguyen Xuan Phuc told a development forum earlier this month that the WB’s International Finance Corporation would assist Viet Nam in handling bad debts, while the ADB and a private partner were planning to acquire a local weak bank.  Vingroup launches new trade center model Vincom +      Property and retail conglomerate Vingroup JSC (Vingroup) has inaugurated the first Vincom + Trade Centre in southern Dong Nai Province’s Long Thanh District. Vincom + is the new trade centre model of Vingroup’s Vincom trade centre system, following the brands Vincom Center, Vincom Mega Mall and Vincom Plaza. The event marks a new milestone in Vingroup’s strategy to expand its trade centre system across Viet Nam. The Vincom + trade centre chain is expected to be introduced in every district of the country to improve the quality of people’s life and provide them the opportunity to experience the most modern shopping service. The store booths in Vincom + are arranged in an orderly and convenient fashion to meet the essential needs of customers and their demand for all types of commodities, such as household appliances, electronic and electrical products, clothing, restaurants and entertainment. Vincom + Long Thanh is the first trade centre of the Vincom + brand to begin operations. It is centrally located, adjacent to many main roads, with total area of more than 4,000sq.m. It has an outdoor parking area which is surrounded by a flower garden, creating a beautiful and modern corner. Most retail brands of Vingroup were present at Vincom + Long Thanh, including Vinmart Supermarket, technology and electronics retail centre VinPro, and VinDS - the chain of stores for cosmetics, footwear, sports and fashion. Vincom + Long Thanh also uses more than 200sq.m. for the “Gaming area,” which has many exciting entertainment services. The introduction of Vincom + partly contributes to the strategy of Vingroup to expand the retail market throughout Viet Nam. It is expected that by the end of 2017, some 20 Vincom + trade centres will be put into operation nationwide. From now until Jan 1,2017, customers with VinID cards shopping at Vincom + Long Thanh, whose shopping bills are valued from VND300,000 at VinMart/VinPro or from 200.00VND at other booths, can participate in Vincom +’s lucky draw. Lucky customers will be presented Sony TVs 40-inch Full HD, Panasonic washing machines or Philips blenders. Midtown brings Japanese to Phu My Hung      Midtown is the most luxurious development in the south of HCM City in the recent years. For the first time Phú Mỹ Hưng has collaborated with other leading Asian property developers, and the result is an architectural masterpiece. Phú Mỹ Hưng Development Corporation has unveiled a new complex called Phú Mỹ Hưng Midtown, for which the corporation is collaborating for the first time with foreign companies. It has set up a joint venture called Phú Hưng Thái Joint Stock Company with three renowned Japanese companies -- Daiwa House Group, Nomura Real Estate Group, and Sumitomo Forestry Group -- to develop Phú Mỹ Hưng Midtown complex. Without disclosing the investment involved, the developers said merely that the project is the most expensive in the recent years in the south of the city. Phú Mỹ Hưng Midtown is inspired by famous complexes around the world like Tokyo Midtown and Manhattan Midtown. The project, targeting high-income customers, is being developed with materials imported from the EU. All the design and building contractors are leading companies in the region. Phú Mỹ Hưng Midtown is situated on the main roads of Phú Mỹ Hưng City Centre – Nguyễn Lương Bằng and Tân Phú. It is an ideal location in Phú Mỹ Hưng City Centre since it connects International Commercial and Financial district and the south district’s luxury residential area. Near Phú Mỹ Hưng Midtown are many administrative offices, office buildings, hotels, malls, hospitals, banks, and international schools. The new masterpiece also abuts a large green space in the south district of Phú Mỹ Hưng City Centre. The developers say Midtown has two components: construction and outdoor area. The central region includes four buildings which will be built on an area of 56,331sq.m. Phú Mỹ Hưng Midtown will be a self-contained complex where many services will be available. In each building will have infinity swimming pool, sauna and massage room, outdoor BBQ area, gym, rooftop’s yoga and park, library, golf simulation, etc. Thus, residents will not need to go anywhere but can still enjoy all the services needed for daily life. Phú Mỹ Hưng Midtown will be a small city with F&B stores, commercial, offices, shops, and supermarkets which will be in the ground and second floors. Besides, the developers have used a large land lot to develop Sakura Park, which is inspired by parks with sakura flower in Japan. Two lines of Sakura trees will be planted along a 600m walking road. A playground for children and a sports centre will also be built. Many amenities will be built in both Vietnamese and Japanese styles -- like a Sakura fountain, floating pavilion and a sculpture garden, etc. Phú Mỹ Hưng Development Corporation said Midtown would become a public area like The Crescent that is successfully developed. Midtown is expected to become a new destination in HCM City in future, the corporation said. TAC to increase capital by issuing more shares      Tuong An Vegetable Oil Stock Company (TAC) on Monday announced there would be extraordinary shareholders meeting on February 10 next year to discuss a bonus issue of shares and an employee stock ownership plan. The board of directors will propose a 10:7 bonus issue, or seven shares for every 10 shares owned. This will increase TAC’s registered capital from VND190 billion (US$8.6 million) to VND322.7 billion ($15 million). The company said it has yet to finalise the ESOP. This is the first time TAC will issue bonus shares to shareholders or stock options to employees since its establishment. KIDO Group (KDC) recently acquired 65 per cent of TAC to help the latter become the leader in the Vietnamese cooking oil market.  Over 150 firms to participate at fashion fair      More than 150 enterprises will showcase their products at the Vietnam International Fashion Fair 2016, which open its doors on December 21 at Ha Noi’s International Centre of Exhibition. Co-organised by Vietnam Exhibition and Fair Centre JSC (VEFAC) and Vietnam Textile and Garment Group, the six-day event will host over 200 booths covering 4,000sq.m. On display will be textiles and garments, footwear, cosmetics, jewellery and beauty services. Vu Ngoan Hop, member of the VEFAC’s board of directors, said the event is not only a trade promotion activity for the local fashion industry and exporters of textiles, footwear, jewellery and fine art products, but is also a good shopping festival for people in the capital city. He also described the event as a promising opportunity for participating enterprises to effectively advertise their products to customers. Last year’s event witnessed the participation of more than 250 local firms, showcasing their goods across 4,000 pavilions. PM approves proposal for infrastructure project for central provinces The Prime Minister has approved a proposal for an infrastructure project in the central provinces of Nghe An, Ha Tinh, Quang Binh and Quang Tri to assist with economic growth in the region. The proposal said the project would be funded by a loan of 97 million USD from the Asian Development Bank (ADB).   The Prime Minister has assigned the Ministry of Finance to identify the project’s domestic financial mechanism to ensure beneficiary localities could meet the conditions on loan payment capacity and loan limits as prescribed by the State budget law.  The Ministry of Planning and Investment was requested to coordinate with relevant agencies to assess a report on investment proposal, and submit to the Government leader in January 2017.  The ADB-funded project aims to upgrade and build new transport infrastructure in the region, thus enhancing regional connectivity, boosting trade, and improving business environment. Production infrastructure will also be built to increase the region’s competitiveness and attract investment into the region. Wood exports at $7.3 billion Wood and wooden product exports stood at $7.3 billion this year, a slight year-on-year increase of 1 per cent, according to the Vietnam Administration of Forestry (VAF) under the Ministry of Agriculture and Rural Development (MARD). Wooden product exports were $5.27 billion, up 5 per cent year-on-year, while woodchip exports were estimated at $650 million, down 39 per cent year-on-year. Mr. Nguyen Ba Ngai, Deputy Director General of VAF, said that in 2016 the value of forest and wooden product exports grew 5-10 per cent compared to 2015 but the value of wood and wooden exports grew just 1 per cent against 2015. The reason is the decline in the value of woodchip exports, which is equal to 61 per cent of its 2015 value. The decline in woodchip exports came from lower global demand, particularly in China. Vietnam’s woodchips also faced competition in price with countries such as Thailand, Australia and some African nations. The country’s wood industry is expected to earn total export value from wood and wooden products of $7.7 billion this year, higher than the $7.1 billion recorded in 2015. Last year Vietnam recorded total export value from wooden and forestry products of $7.1 billion, an 8 per cent increase against 2014. Its three largest export markets were the US, Japan and China, accounting for 67 per cent of the total value. Export markets with high value last year included India, with growth of 64.45 per cent, Hong Kong with 41.95 per cent, the US with 17.8 per cent, and Germany with 10 per cent. The increase in export value was due to high demand in global markets. The US needs to import wooden products worth $27 billion each year while Vietnam exports between $1 billion and $2 billion of such products each year. The EU market has demand for wooden products worth $85 billion but Vietnam’s export value to the EU stands at just $700 million to $800 million annually. Once the Voluntary Partnership Agreement on Forest Law Enforcement, Governance and Trade (VPA/FLEGT) comes into force, there will be opportunities for Vietnam to export more wooden products to Europe and other new markets as well as earn higher prices, according to the EU Delegation to Vietnam. The pact will increase the competitiveness of Vietnamese timber products compared to those from countries that do not have much control over their forestry sector. A VPA is a voluntary trade agreement between the EU and countries making wooden products, to promote trade in legal timber and help ensure only legally-harvested timber is imported into the EU from these countries. The EU and Vietnam finished negotiating a VPA on November 18 and an agreement is expected to be signed in early 2017. According to the Ministry of Industry and Trade, under the agreement the country will create a timber legality assurance system (TLAS) in line with the country’s circumstances and the EU’s requirements for identifying the origin of timber. The full operation of the TLAS would significantly contribute to identifying the origin of Vietnamese timber products exported to the EU and other markets. Once the VPA is fully implemented, the country will issue FLEGT licenses for exports of wooden products to document that they meet all relevant local laws. If a license is in place, EU companies don’t have to conduct any due diligence. Ana Mandara Villas Dalat to expand Ana Mandara Villas Dalat has celebrated its landmark 10th anniversary by adding more than ten rooms for guests staying in early 2017. As it enters its second decade the resort also enters into a new phase of development, with brand promises to deliver a complete destination experience and multifunction services to guests. According to the resort’s Chairwowan Ms. Le Ha, it will build a conference area with a capacity of about 200, for guests, workshops, or destination weddings. Ana Mandara Villas Dalat is also offering a promotion package for only VND4,950,000 for a two-night stay in a Villa Room, including daily breakfast for two, airport pick-up, early check-in (subject to availability), and a 20 per cent discount on spa services and 10 per cent on F&B and excursions. The promotion is valid from now to February 28 when booked directly on its website or its reservation service. Opened in December 2006, Ana Mandara Villas Dalat Resort & Spa is set in the cool climate of the rural highlands of central Vietnam, amid lush rolling hills and just a five-minute drive from the center of Da Lat. It comprises 17 fully-restored luxury French-style villas converted into 72 guest rooms, preserving the original design, décor and charm from the 1920s and 1930s. The villas boast a view of the surrounding town and countryside and are in all areas of the gently sloping hillside property. Villas have two rooms, each with a different vibe and a distinguished design and interior. One room features old wooden ceilings and mountain views while the other has a working fireplace and old wooden doors leading directly to the garden. All have wooden floors, with the creaking sound of the floorboards adding charm to the experience. Both rooms also have beautiful large bathrooms with free standing bath tubs that are very much appreciated on cold Da Lat evenings. The furniture and decor are in dark wood, in keeping with the style and design of the villas. Together they give guests a cozy feeling, as if they were at home. The local hills were reconstructed for resort purposes, with an outdoor heated swimming pool, while the Le Petit Restaurant and La Cochinchine Spa were incorporated into existing villas, turning the resort into a small countryside village set nearby crowded city life just five minutes away. While walking around the resort, guests will see the green garden where the resort grows organic vegetables and herbs along with fruit trees. “Made in Vietnam” cranes shipped to Saudi Arabia After eight months of design, manufacturing, and inspection, Doosan Vina’s Material Handling Systems Shop on December 18 completed loading and shipped eight Rubber Tired Gantry Cranes (RTGC) to Saudi Global Ports (SGP). The shipment arrived a month ahead of schedule.  The purchase of eight RTGC for SGP was signed between Doosan Vina and SGP on March 4, 2016.  Each of the cranes weighs 155 tonnes, is 29 metres high, 27.6 metres long, and 5.6 metres wide.  They are designed to load 40-tonne cargo containers onto trucks for transit to customers or to move containers around the port. These eight cranes raise the total number of “Made in Vietnam” cargo container cranes to 65. The cranes are expected to arrive in Dammam City, after three weeks of transit. Dammam City is a key gateway to the Arabian Gulf, a major economic and commercial hub of the SGP system. Fruit and vegetable exports beat rice, earning US$2.3 billion Revenues from fruit and vegetable exports in 2016 exceeded those of rice as of December 15, bringing in US$2.3 billion, according to the General Department of Customs. Meanwhile rice shipments only generated US$2.1 billion, the department reported. Data released by the Ministry of Agriculture and Rural Development earlier showed that fruit and vegetable exports brought in US$186 million, raising total revenues in the first eleven months of 2016 to US$2.178 billion. China was the largest buyer of Vietnam’s fruit and vegetables, accounting for more than two thirds, while the combined share of Japan, the US and the Republic of Korea also made up more than 10%. In the past ten years, fruit and vegetable exports have seen strong growth from only US$235 million in 2015 when these products were shipped to just 36 countries and territories. Currently Vietnam’s fruit and vegetables have reached more than 60 markets. Such impressive figures have become a significant driver to attract more investment into agriculture, particularly fruit and vegetables and help farmers to increase their incomes. Besides traditional markets, Vietnam’s fruit and vegetables have gradually made their way into demanding markets such as the US, the European Union, Japan, Canada, Australia and New Zealand. This year, Vietnamese lychees and mangoes have been shipped to Australia and the US while dragon fruit will also come to Australia soon. That Vietnam’s fruit and vegetables are accepted by more and more markets around the world demonstrates their increasing quality and farmers’ greater awareness of good agricultural practices. FDI firms account for 70.3 percent of Vietnam’s export turnover   Foreign direct investment (FDI) sector posted an export turnover of US$117.99 billion as of December 15 this year, increasing 11.5 percent over the same period last year and accounting for 70.3 percent of the country’s number. According to General Customs Department, the sector’s import turnover saw a year on year increase of 5.4 percent to $97.52 billion, contributing to 59 percent of the country’s value. Vietnam’s export value neared $167.83 billion, up 8.5 percent equivalent to $13.11 billion against a year back. Import turnover touched $165.23 billion, up 4.3 percent equivalent to $6.85 billion. Total export import turnover approximated $333.06 billion, a year on year increase of 6.4 percent equivalent to $19.96 billion over the same period last year. The country saw a trade deficit of $228 million within the first half of this month but enjoyed a trade surplus of $2.59 billion this year. Discounted tours attract droves of buyers Nearly 220,800 customers have bought discounted tour packages under the domestic travel stimulus program this year, up more than 70% from last year, says the HCMC Tourism Association. The stimulus program is being deployed by the HCMC Tourism Association along with three local airlines – Vietnam Airlines, VietJet Air and Jetstar Pacific. This year marks the first time Saigon Railways has joined the program by offering sales promotions, with over 13,000 tickets sold. “If the number of promotional tickets for tour operators did not have time limits, there would be even more buyers of promotional tour packages. The bigger the discounts are, the greater the purchasing power is,” said Nguyen The Vinh, head of the group of domestic travel stimulus enterprises at the HCMC Tourism Association. With the cooperation between tour operators and air carriers, many tour packages from HCMC to Hanoi, Phu Quoc, Danang, Nha Trang and Hai Phong are 20-40% or even 65% cheaper at some points. Rail tours give the lowest discounts, but their destinations are quite diverse, from HCMC to Nha Trang, Danang, Binh Thuan and Phu Yen. In 2017, the HCMC Tourism Association along with aviation and railway firms will continue the stimulus program on a larger scale. It is expected that Hanoi Railway Transport JSC will be a new participant for connection of tourist routes to Hanoi and northern provinces. Tourists may select road or rail tours, or a combination of both. Discounts may be up to 70% for airway tours and 25% for rail tours next year. “The program has proven effective, so this time we get prepared to sell sooner. In January 2017, travel firms will be able to offer promotional tour packages. Based on the current number of air tickets, tours will probably be sold out in March 2017,” said Ngo Thi Thu Hien, deputy director of the southern region branch of Vietnam Airlines. Saigon Railways informs it will set aside many promotions for the travel stimulus program next year. Tour operators will be able to buy tickets with discounts of up to 40% to design their packages. Even in the peak season of summer, railway fares will probably be slashed 10% instead of being kept unchanged as this year. If travel agencies book tickets 30 days in advance, the rates will be halved. “The partnership with tour operators has produced initial results. We are developing more infrastructure for tourism. It is expected that 15 new carriages will be put into operation in January 15. Earlier, we have fixed 37 carriages,” said Le Quoc Trung, deputy general director of Saigon Railways. Next year, such cooperation will be furthered to launch promotional programs called “Spring trip to Saigon” and “Spring trip to the south”, encouraging visitors from the north and the central region to travel to HCMC and elsewhere in the south during 10 days prior to and 10 days after the lunar New Year, or Tet. “Trains and flights are often one-way empty from the central and the north to HCMC during 10 days before Tet, so we work together to lure tourists. Currently, Vietnam Airlines is committed to discounts of 50-60%, Vietjet 98% to even 100%, and Saigon Railways 50% for the less-packed journeys for us to design our tours,” said Nguyen Thi Khanh, vice chair of the HCMC Tourism Association. Textile export target unobtainable The new year is less than half a month away but this year’s textile exports remain low and are still far from the initial target of US$31 billion or the adjusted one of US$29 billion. Textile exports reached US$1.9 billion in November, down 1.9% from October, as per the latest figures published by the General Department of Customs. Thus, the total export value of textile- garment products in the January-November period was US$21.56 billion, a modest rise of 4.6% year-on-year. That is 30% below the initial target. Earlier, the Department for National Economic Issues at the Ministry of Planning and Investment also noted the textile industry was facing multiple difficulties due to declining demand in major export markets such as the U.S., the EU and Japan. In the past 11 months, production of fabrics made from natural fibers fell 2.2%, whereas that of fabrics from synthetic or artificial fibers and casual clothing picked up 6.1% and 7.1% respectively. Market watchers said the export growth rate in the year to date is the lowest in 10 years, in which this key industry always recorded double-digit growth. In addition to objective factors such as a number of importers struggling with economic issues or the Brexit, it is believed the other difficulties of the textile industry come from the foreign exchange policy of pegging the Vietnamese dong to the greenback, making Vietnamese commodities more expensive and less competitive. Also, the domestic textile sector is dealing with competitive pressure from other major textile exporters like Cambodia and Bangladesh, whose exports stateside are duty-free while Vietnamese items are slapped a 17% rate. Besides, the minimum wage in Myanmar, Bangladesh and Sri Lanka are lower than in Vietnam. Notably, export growth of the textile industry in the past 11 months is mainly contributed by foreign-invested enterprises (FIEs). Meanwhile, domestic firms are experiencing hardships in the search for new orders. A lot of small and medium enterprises may have to shut down due to their poor competitiveness and extremely difficult production conditions. Market watchers said customers are leaving Vietnam for countries with lower production costs, such as Myanmar, Cambodia and India, where there are no regulations on annual minimum wage hikes and the social insurance contribution rate is only 18% versus 22% in Vietnam. Moreover, labor costs in the above countries are lower than in Vietnam, prompting customers to shift their orders there. Even so, the Ministry of Industry and Trade informs the Vietnam Textile and Apparel Association (VITAS) has predicted export turnover from textiles will be some US$28.5 billion in 2016, or only US$1.5 billion lower than the expected level, says a report on the online newspaper Tien Phong. In other words, the textile industry would meet 92% of the target. Analysts explain such forecasts of VITAS usually consist of export turnover from fibers, yarns and fabrics. With the turnover of these items included, the total export value of Vietnam’s textile industry in the first 11 months would be around US$25.2 billion, according to the General Department of Customs. Can Tho looks to become logistics center in Mekong Delta Can Tho City has singled out three locations and one of them will be selected to develop a logistics center and make it the biggest in the Mekong Delta in the coming time.  Nguyen Quang Vinh, head of the trade management division at the municipal Department of Industry and Trade, told a meeting on December 20 that three businesses had shown keen interest in building a logistics system for the city. They are HCMC-based Long Thinh Co Ltd., Genuine Partner Group, and Thai Binh Province-headquartered TBS Group. Vinh was speaking at a meeting between the Can Tho government and relevant departments and agencies to discuss a plan to set up the logistics center. He said three places in Cai Rang District are suitable to develop this center, including a 74-hectare site at Cai Rang industrial and urban area, a 120-hectare site at Cai Cui Port and another covering 75.8 hectares at Hung Phu 1 Industrial Park. The city has not decided on one. Nguyen Tan Duoc, director of the Can Tho Department of Construction, said the city must collect data and consider cargo transport demand now and in the future before selecting a location for the logistics center to avoid wastefulness. Truong Quang Hoai Nam, vice chairman of Can Tho City, ordered relevant departments and agencies to review changes in land planning to clarify if the conversion of an industrial location into a logistics center violates the prevailing regulations or affects the city’s zoning plan, among other matters. Nam added the logistics center would become a driver for social-economic growth in Can Tho and the Mekong Delta as a whole in the years to come. In November last year, the Can Tho government wrote to the Ministry of Industry and Trade to seek backing for the formation of a logistics system in the city.    The ministry supported the proposal, saying the construction of a logistic center in Can Tho is appropriate to the zoning plan for Vietnam’s logistics system until 2020 with a vision towards 2030. The zoning plan was passed in July 2015 with an aim to promote goods circulation and distribution for domestic consumption and export and boost social-economic development. Nhan Co plant turns out first alumina Vinacomin-Dak Nong Aluminium Company (DNA)’s Nhan Co alumina plant in the Central Highlands province of Dak Nong produced the first products last Friday, said a source from Vietnam National Coal and Mineral Industries Group (Vinacomin). Alumina is the final product of the production line at Nhan Co alumina plant. The plant produced hydrate products successfully early last November. Alumina is produced when baking hydrate at around 1,100 degrees Celsius or 2,012 degrees Fahrenheit. An average of 1.5-1.7 tons of hydrate will make a ton of alumina. DNA said the plant has produced 38,000 tons of hydrate, with average output of about 1,000-1,500 tons a day. The company will continue to raise its capacity to meet Vinacomin’s production plan after this first successful alumina products. Apart from Nhan Co and Tan Rai bauxite-alumina plants, Vinacomin is working on a plan to attract domestic and foreign investments into a modern aluminum electrolysis complex in the coming time. Previously, the Government gave the green light to alumina manufacturing facilities to go public.  The Nhan Co alumina plant project located in Nhan Co Commune in Dak Nong Province’s Dak R’lap District has an annual capacity of 650,000 tons and total capital of over VND12 trillion. Local firm wants to export steel furnace dust Kim Phuc Ha Company in Lang Son Province has sought approval from the Ministry of Industry and Trade to export 300,000 tons of steel furnace dust, Tuoi Tre newspaper reports. Nguyen Van Sua, vice chairman of the Vietnam Steel Association (VSA), said furnace dust is the waste discharged from the steelmaking process. However, no local enterprises are capable of treating it. Therefore, the company has conducted market research and signed an export contract with a Chinese company. The waste is listed as hazardous in line with the regulations of the Ministry of Natural Resources and Environment, as it contains dangerous metals including zinc. The Chinese company wants to buy furnace dust for the purpose of extracting zinc as the metal contained in dust accounts for 19-20% of volume, higher than the content from the normal zinc ore, Sua added. Some firms, mainly in the northern region, have registered to treat furnace dust. However, these enterprises fail to meet the requirement for treatment. The company can be considered the first enterprise to seek approval to export furnace dust. Trade surplus reaches US$2.59 bln in 12 months Viet Nam ran a trade deficit of US$288 million in the first half of December 2016, however, it enjoyed a trade surplus of more than US$2.59 billion from early 2016 till December 15, according to the Viet Nam Customs. As of December 15, the nation’s total export and import turnover attained nearly US$333.06 billion, a year-on-year increase of 6.4%. Within the first 15 days of December, the total export and import turnover of the Foreign Direct Investment (FDI) sector fetched US$10.33 billion, down 3.7% or US$400 million less than  the previous month. Viet Nam gained US$7.9 billion from exports in the first 15 days of 2016, down 7.2% against the previous month. The nation’s total export and import turnover was estimated at US$167.83 billion, a year-on-year increase of 8.5%. The FDI sector’s total export and import turnover exceeded US$117.99 billion, a year-on-year increase of 11.5% or US$12.17 billion, accounting for 70.3% of the nation’s total import and export value. Viet Nam’s import turnover in the first 15 days of December obtained US$8.19 billion, down 0.6% compared to the previous month, raising the nation’s total import turnover till December 15 to US$165.23 billion, up 4.3% against the same period last year. The FDI sector’s total import value till December 15 reached US$97.52 billion, a year-on-year increase of 4.5%, making up 59%. Deputy PM says TPP future unpredictable Vietnam has yet to measure the impact of the Trans-Pacific Partnership (TPP) on its economy because the future of the free trade pact remains unpredictable, said Deputy Prime Minister Vuong Dinh Hue. Trade and diplomatic polices of the U.S. will not be clear until President-elect Donald Trump enters the White House on January 20, 2017. Currently, Japan has approved the TPP and Japanese Prime Minister Shinzo Abe might ask Vietnam for an early ratification of the deal at his upcoming visit to the country. The U.S. might face more pressure if many countries ratify the deal, Hue said at a meeting of the National Assembly (NA) Standing Committee in Hanoi on December 21. With or without the TPP, the Government is looking to improve the nation’s legal framework in the next three to five years as the free trade agreement between Vietnam and the European Union (EU) has similar standards to the TPP, Hue said. NA vice chairman Do Ba Ty at the meeting raised numerous questions over the Government’s forecast on the TPP, the nation’s participation in the pact and its impact on the local economy in case of U.S. withdrawal. Many countries have expressed concern over the fate of the TPP. Some have insisted on going ahead with the trade deal even if the U.S. pulls out while others are concerned about the significance of the deal without America. The Government should identify negative impacts if the TPP is not turned into reality and find coping solutions, Ty said. After Vietnam signed the TPP in February, the Ministry of Justice has coordinated with relevant ministries and agencies to review regulations of the deal to secure proper implementation and suggest solutions to deal with shortcomings, according to a Government report. Meanwhile, the NA Economic Committee did not mention the TPP in its report. The TPP, one of the world’s biggest multinational trade deals, was signed by 12 Pacific Rim nations including Vietnam on February 4. However, the agreement could take effect only with the approval of parliaments of at least six member countries, which account for at least 85% of the gross domestic product (GDP) of the 12 members. Therefore, the U.S. that accounts for 62% of the TPP’s GDP and Japan makes up 17% are the decisive factors for the trade pact. Eurosphere set for HCMC in June The EU Vietnam Business Network (EVBN) will hold the first European Art of Living Exhibition in Vietnam and Southeast Asia (Eurosphere 2017) on June 16 and 17 at the Gem Center in Ho Chi Minh City. There will be 100 European brands exhibiting to 3,500 business visitors from Vietnam and Southeast Asia at Eurosphere 2017. Visitors can meet and connect with leading importers, distributors and luxury segment experts from Europe and policy makers from the region and remain up-to-date on the latest know-how in European creativity, ingenuity and craftsmanship. The exhibition features a wide range of sectors: Gourmet Food, Wine & Spirits, Fashion, Fashion Accessories, Jewelry, Horology, Perfumery, Cosmetics, Furniture, Interior Design, and Automotive. It presents the elegance, sophistication and harmonious living of European culture. The concept of Eurosphere creates a lively flow of interaction among the exhibiting companies and visitors. Tickets for the two days are VND500,000 ($22). The overall objective of the EVBN is to increase exports and investments from the EU to Vietnam, in particular those by small and medium-sized enterprises (SMEs), as well as to strengthen the EU business community in Vietnam by facilitating market access via advocacy, primarily with the Vietnamese Government. The EU business community in Vietnam as well as SMEs and in particular businesses from EU member states who do not yet have official commercial representation in Vietnam are regarded as major beneficiaries of the program. The EVBN will strengthen the EU business community in facilitating market access in Vietnam by advocating and engaging primarily with the government, Vietnam’s business community, and other stakeholders. The EVBN will promote Vietnam as a high-potential trade and investment market and guarantee that EU companies, in particular SMEs, are better able to access the growing opportunities in Vietnam and use the country as a gateway to the Southeast Asian market. PM calls on Saigon New Port to develop Prime Minister Nguyen Xuan Phuc told the Saigon New Port Corporation during a working visit to the company in Ho Chi Minh City on December 19 that he expects it to become the country’s leading maritime economic unit. The corporation needs to work harder and strive to reach international standards with continual entrepreneurship and creativity when doing business and become the leading defense and economic unit in Vietnam in the maritime economy, he said. It should expand production and pay special attention to improving its strategic locations while continuing to reorganize its affiliates, he said. He asked it to fulfil both its economic and defense missions and urged it to focus on increasing its workplace productivity, ensuring stable incomes for workers and enhancing competitiveness. The Saigon New Port Corporation, a 100-per-cent State-owned enterprise, operates as a one-member limited liability company and specializes in ports, logistics, and maritime transport. It has been ranked as a specialized enterprise since 2010. Its market capitalization stands at over VND30 trillion ($1.35 billion). Revenue has grown 21 per cent each year on average. This year it expects to earn around $775 million in revenue, up 12 per cent year-on-year, and $88 million in profit. The PM also praised it for reducing container loading times from 35 hours to 12 hours. One of the strong economic units of Vietnam’s People Navy, Saigon New Port possesses 17 ports capable of berthing vessels of up to 200,000 DWT. Its container port services hold a 50 per cent market share in Vietnam and 89 per cent in the Ho Chi Minh City area. It is listed in the Top 20 logistics companies in Vietnam with sea transport services holding a 25 per cent domestic market share. According to the national seaport development plan to 2020, Ho Chi Minh City is the southeast region’s key port with functional wharf areas in Hiep Phuoc on the Soai Rap River and Cat Lai on the Dong Nai River. The region’s seaports are expected to handle 265 to 305 million tons of cargo by 2020 and 495 to 650 million tons by 2030. In early December Saigon New Port held an opening ceremony for the Tan Cang - Cai Nui Port Phase 1 in the Mekong Delta’s Can Tho province. The first phase covers an area of more than 7 ha, with a wharf 180 meters in length that can berth vessels of 20,000 tons. The Van Thinh Phat Group, one of the leading real estate and hospitality groups in Vietnam, adopted a plan a few years ago to take part in the transformation project for Saigon Port. In 2011 the government released a document that permitted Saigon Port to establish new legal representatives to implement the investment project for the Nha Rong - Khanh Hoi Port area. Vietnam National Shipping Lines (Vinalines) assigned Saigon Port to establish an investment plan in 2012. However, during the process of negotiating with partners, Van Thinh Phat applied to withdraw from the project. It has now been completed without the involvement of the Group. Cuba boosts cooperation with Mekong Delta Cuba will step up cooperation with the Mekong Delta of Vietnam in agro-forestry, tourism, medicine and biotechnology. Cuban Consul General in Ho Chi Minh City Bernabe Garcia Valido made the affirmation at a meeting with local authorities in Can Tho city on December 23. He said Cuba is inviting Vietnamese businesses to invest in the aforesaid fields, adding that they can select investment and business partnership forms.  He noted that Cuba is calling for investment in all fields, excluding education, healthcare services, and armed forces organisations.  Investors are allowed to sell or transfer their capital to the State or the third party, and send foreign currency abroad without paying taxes, he added.  Vietnamese businesses, in particular, will get more incentives on procedures as well as competitive advantages when investing in Cuba, he affirmed.  Vice Chairman of the municipal Nguyen Thanh Dung referred to Labiofarm company as a joint venture between Can Tho and Cuba.  The company is operating in the field of chemicals production using environmentally friendly technology and with a total investment of 5.6 million USD.  Dung expressed his belief in the bright future of bilateral trade cooperation, adding that the Mekong Delta city hoped to welcome more Cuban businesses. Digital content may be next chapter in Vietnam's IT success story Impressive internet connectivity and the broad expansion of mobile phone usage could create a digital content boom. Fifteen years ago, Vietnam had virtually no information technology industry; today, business is booming and industry insiders say the country's impressive smart phone connectivity has potential to usher a digital content boom. Given Vietnam’s growing population of IT professionals and its rapidly developing Internet infrastructure, digital content generation has the potential to become the sector's driving force, said Nguyen Thanh Hung, deputy minister of information and communication at the 2016 Internet Day Event. By 2020, Vietnam’s economy will have added an additional $5.1 billion to its economy, mostly due to mobile internet growth, researchers from Oxford Economics announced during a workshop on Tuesday. By that time, Government projections anticipate the mobile internet could contribute the equivalent of 6.2 percent of Vietnam's current GDP, while creating 145,600 jobs between 2015 and 2020.  Le Hong Minh of VNG Corp -- a major online gaming company -- says that by the time those jobs come online, 60 percent of the population will use smart phones   Even now, Minh added, Vietnam's internet centers around mobile devices rather than personal computers, a situation that promises huge growth potential. The creation of everything from traffic management apps to viral smartphone games stands as just the latest chapter in the industry's rapid transition from phone manufacturer to software designer. According to a recent release from the Ministry of Information, Vietnam's Information Technology sector expanded by an average of 34 percent per year and now boasts over 14,000 businesses. Starting in 2008, annual revenue growth held steady at 60 percent, according to the 2013 White Book on Information and Communication Technology in Vietnam.  Export-oriented hardware production generated most of that money, as major manufacturers like Samsung shifted smart phone and tablet production to Vietnam to take advantage of cheap labor. Customs statistics reveal smart phone and electronic parts production has been Vietnam’s biggest money maker; revenue generated by the sector is expected to have grown by 12 percent (or US$4 billion) this year alone. Though markedly smaller, firms offering IT services have also grown by leaps and bounds. According to the Vietnam Software and IT Services Association (VINASA), software and digital content contribute over $1 billion to the economy, annually. The top 50 IT companies generated $1.2 billion in revenue last year,  mostly at outsourcing firms that reportedly employed 30,500 high-skilled tech workers. According to Internet World Stats, Vietnam is currently ranked 18th in the world’s top 20 countries in terms of the number of internet users. Vietnam has more than 49 million people surfing the internet. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR