BUSINESS IN BRIEF 4/4
$23,711 invested in high-tech Park
The Saigon Hi-Tech Park
The Saigon Hi-Tech Park yesterday granted investment license to the Tay Saigon School (Western Saigon Vocational College) to build research and international training cooperation center.
The center covers an area of 17,550 meter square with total investment of VND540 billion ($23,711).
It is aimed to carry out research, application and transfer of technology and training in the field automated technology, new material technology, precision mechanism, biology, waste treatment technology, solid waste and environment protection.
The school plans to enroll from 2,000 to 3,600 students.
CJ Group looks to step up presence in Vietnam
CJ Group will sound out business opportunities in multiple sectors in Vietnam, especially food processing, to expand its presence in this growing market.
Chang Bok Sang, president and CEO of CJ Group Vietnam, told reporters in HCMC on March 28 that CJ will continue investing in this market, including via mergers and acquisitions (M&A), and bank on the equitization of State-owned enterprises. Food processing is among the priority sectors the group is eyeing.
Chang did not elaborate how much CJ will inject in Vietnam this year but said the group has sufficient finances for new good investments.
Chang said CJ will boost cooperation with partners in the investments it made last year, with priorities given to introducing its advantages in food, culture and application of new technology.
CJ had poured around US$500 million into investment projects in Vietnam as of the end of 2016. The group bought stakes in Vietnamese food and foodstuff processing firms Vissan, Cau Tre and Minh Dat.
In March 2016, CJ Group unveiled a plan to spend an additional US$500 million expanding its Vietnam operations within the year after investing US$400 million in this market.
The fresh investment plan was part of CJ Group’s target of turning Vietnam into its third largest investment venue after South Korea and China by 2020.
To realize the target, the group, via CJ Cau Tre, will get involved in a VND1.2-trillion project to develop a complex of food processing and research and development (R&D) facilities, and food safety research and logistical centers in Hiep Phuoc Industrial Park in HCMC.
Thanh Phuoc Port JSC, a member of CJ, is completing procedures for a project to develop an inland customs clearance depot in southern Vietnam.
Last October, CJ Blue joint venture was established to provide strategy consulting and marketing solutions. The investment also went to the development of CJ CGV cinemas, food processing, film production and logistics, among others.
In February, the sixth animal feed plant of CJ Vina Agri got off the ground in the central province of Binh Dinh and is scheduled to be commissioned at the end of this year. Its fifth animal feed plant, located in Ha Nam Province, is expected to come on stream this September.
CJ is now in talks with livestock and food processing partners to realize its strategy to improve a feed-farm-food model to turn out products for local consumption and export.
Chang said CJ will further spend on human resource development this year to help the group better capitalize on investment opportunities in this market.
Investment in startups rises 46%
Investments in startup projects in 2016 increased 46% to roughly US$205 million although the number of funded projects was 25% lower than in 2015, according to business incubator Topica Founder Institute (TFI).
A report on startup investments issued by TFI shows that some US$205 million was invested in 50 startup projects last year. Of this figure, US$129 million went to startup enterprises active in the field of financial technology.
Some 30% of the investments were funded at the beginning of the projects, while investments in the development stage of startups accounted for 40%. Acquisition deals attracted 14% of the investments while angel investors injected some 4% of the total investment.
Some startup projects attracted huge funds in 2016, such as the F88 pawnshops invested with US$10 million by Mekong Capital, the educational app named GotIt! obtained US$9.1 million by Capricorn investment fund, the digital wallet project MoMo with US$28 million invested by Standard Chartered and Goldman Sachs.
Startup projects in education in 2016 had a significant development with six investment contracts worth US$20 million.
In addition, the transfer of 62.25% of VNPT E-pay’s shares worth US$33.8 million to UTC Investment, the acquisition of VNG for 38% of Tiki’s shares worth US$17 million and the acquisition of Zalora Vietnam by Central Group at US$10 million were some outstanding deals last year.
Shipping route between Can Tho and Singapore to be launched soon
A direct shipping route between Tan Cang-Cai Cui Port in Can Tho City and Singapore ports will be launched next June or July, said Vu Khanh Duong, director of the Saigon Newport Corporation’s Southwest Office, at a seminar in Can Tho on March 28.
He said the launch may come sooner if local producers support the corporation’s decision. Ben Line, a Singapore-based shipping agency, will cooperate with the corporation to transport the first shipment to the island city-state.
He added Tan Cang-Cai Cui Port has received around 1,500 container vessels since the Quan Chanh Bo Canal was opened for sea-faring ships late last year. The port has been equipped with modern machinery and equipment.
In addition, information technology has been use to facilitate management and operation activities at the port as at Cat Lai and Cai Mep ports in HCMC.
The corporation plans to develop a crane system, expand warehouses, and install more facilities at the port.
Chance to rebuild tra fish image comes up
Tra fish exporters are having trouble in the European Union market given an export decline but industry insiders believe this is an opportunity to rebuild the image of the industry through sustainable farming, cost reduction, and production aligned to market demand.
The above remark was given at a review meeting on the Sustainable Pangasius Supply Chain (SUPA) project in HCMC on March 29.
The EU is a demanding market with strict environmental requirements for sustainable development of everyday consumer products such as seafood. That is why the export of tra fish to this market has been tumbling since negative news about tra fish in Vietnam emerged in the EU media, said experts.
Therefore, to win back its EU market, tra fish has no other way but to take the path of sustainable farming, and efficient use of resources like water and power.
Le Xuan Thinh, SUPA project coordinator, said the greatest challenges for the tra production chain were high feed costs, low fish survival rates, and high water and energy consumption.
The existence of too many intermediaries pushes up costs while businesses experience a lot of hardships with certificates.
Therefore, the SUPA project focuses on these issues. The project has helped enterprises develop 20 new products mainly from by-products, thereby improving their quality to meet market demand.
Also, thanks to the project, businesses are able to slash power consumption by 18-20% and water use by 26-30%, thereby lowering the production cost of each processing plant by VND2-5 billion.
This is why Hoang Thanh, a representative of the EU delegation in Vietnam, commented that the SUPA project was assessed by the EU as one of the comprehensive projects.
Tran Dinh Luan, deputy general director of the Vietnam Directorate of Fisheries, ascribed the flimsy price of tra fish in the past to the lack of sustainability in the development of the industry. Therefore, Vietnam is planning production restructuring towards sustainability, cost efficiency, and alignment of production to market demand.
To restructure the tra fish industry, the Directorate of Fisheries has many projects that help businesses add value to their products and expand consumption markets.
One of the unsustainable factors of the tra fish supply chain is that fish fillets make up the majority of products, with low added value. The Ministry of Agriculture and Rural Development has signed Decision 655/QD-BNN-TCTS, according to which nearly VND165 billion will be spent on reorganizing the fisheries sector, including tra fish, from 2017-2020.
The SUPA project is supported by the EU via the EU SWITCH-Asia program for a four-year period from April 2013 to March 2017, with tra fish production and processing units in the Mekong Delta as beneficiaries.
Four organizations involved in the SUPA project are Vietnam Cleaner Production Center, Vietnam Association of Seafood Exporters and Producers, and WWF Vietnam and WWF Austria. The purpose of this project is to help the tra fish industry of Vietnam achieve sustainable production, meeting the standards and demands of the market, especially of EU countries.
Tetra Pak to build US$110 million packaging plant
Tetra Pak, the world’s leading food processing and packaging solutions company, will build a US$110 million manufacturing facility in Binh Duong Province.
Robert Graves, general director of Tetra Pak Vietnam, told the local media on Tuesday that the facility, which is expected to come on stream in 2019, has a designed production capacity of around 20 billion products per year to serve customers at home and abroad.
The project was licensed by the provincial government of Binh Duong.
Tetra Pak has long imported packaging products from its long-established production facilities in Singapore and India. Output from the new plant is expected to meet the increasing demand in the domestic market, while part of it will also be shipped to ASEAN and Australian markets.
Notably, raw material will be fully imported, according to Graves.
Last year, Tetra Pak supplied around 7.5 billion packaging products for the domestic market.
Maritime, air-conditioning expos start in HCMC
Two international exhibitions on the maritime and air-conditioning sectors were opened under the same roof at the Saigon Exhibition and Convention Center (SECC) in HCMC on March 29.
The sixth International Maritime Exhibition (INMEX Vietnam 2017) features 300 brands of shipbuilding, shipping, marine services and engineering, marine equipment, offshore marine, port and logistics from Germany, Italy, South Korea, Norway, Russia, New Zealand, the Netherlands, the UK and the U.S.
Vietnam has a coastline of 3,200 kilometers, plus 1,900 kilometers of inland waterway and 127 ports, which all facilitate maritime development.
Hendrik G. Lacet, director of the Maritime - Consult Lacet Company and INMEX consultant, noted that Vietnam has good conditions to develop the shipbuilding industry. He highly valued the sector development in the coming time.
Meanwhile, the 11th Heating, Ventilation, Air Conditioning and Refrigeration Exhibition (HVACR) is attended by 250 major enterprises from 12 countries and territories including India, Japan, South Korea, China, Taiwan, Turkey and Singapore. These enterprises are showcasing modern heating, ventilation, air-conditioning, and refrigeration systems.
These two exhibitions, organized by the Vietnam National Trade Fair and Advertising JSC (VINEXAD) and Informa Exhibition (Asia), will wrap up on March 31.
HCM City eyes boost to tourism promotion, marketing
HCM City’s tourism industry will strengthen co-operation with official agencies, district administrations and various industry stakeholders to improve tourism promotion and marketing, city officials have said.
Trần Vĩnh Tuyến, deputy chairman of the People’s Committee, said the city is focusing on developing river tourism and promoting rural, ecological and cultural tourism in districts 9, 5, Củ Chi, and Cần Giờ in the coming months.
Every month the People’s Committee would organise meetings to assess tourism growth, he told a meeting this week.
Close co-ordination between State agencies and stake holders is vital to gather feedback for developing tourism, he said.
Bùi Tá Hoàng Vũ, director of the Department of Tourism, said there would be at least one tourism event held in the city every month.
Processes to ensure the safety of tourists visiting the city would be strengthened, he said.
The Department of Tourism will work with the Department of Transport to upgrade piers for tourist boats to dock.
It is expected that the first river public transit route from Bạch Đằng Wharf in District 1 to Thủ Đức District will start at the end of June.
Route No.2 from Bạch Đằng Wharf to District 8 will begin early next year.
This year the department has promoted tourism products in districts 5, Củ Chi and Cần Giờ through field trips to tourist destinations and meetings with local authorities, major tour operators and tourism services providers, Vũ said.
A wide range of tourism promotion activities and events to attract tourists have been held, including a ceremony to welcome the five millionth international tourist, the HCM City Áo Dài Festival, Tourism Fair, and the Việt Nam-HCM City Promotion Programme in Russia.
The number of foreigners visiting the city soared 15 per cent in the first quarter of the year to more than 1.5 million.
Turnover from tourism is estimated at VNĐ27.7 trillion (US$1.22 billion), a year-on-year increase of 15.6 per cent.
Shandong, Đà Nẵng to seek investment in agriculture
Businesses from the Chinese province of Shandong have been seeking more investment and co-operation opportunities with local partners in the fields of agriculture, trade, agricultural machinery production, farm produce export, bio industry, hi-tech farm and food safety in the central city.
Head of Shandong’s working delegation, Wang Junmin spoke at a seminar on agriculture and business co-operation in the city yesterday.
Wang said Vietnamese fresh fruits are a popular farm produce in Shandong as well as rubber, while garlic, ginger and agricultural machinery have been made available for the Việt Nam market.
He said 102 investment projects with total registered investment capital of US$1.22 billion from Shandong have been approved by the central city’s People’s Committee.
Wang said businesses from the province have so far poured $4.1 billion in Việt Nam.
“We have called for a co-operative mechanism in boosting investment, tourism, cultural exchange and connections among travel and enterprise associations and universities between Đà Nẵng and Shandong,” Wang said.
He also invited Đà Nẵng to join the Ocean Forum to be held in Shandong this September, strengthening the relationship of the two locations.
Vice Chairman of Đà Nẵng city’s People’s Committee, Hồ Kỳ Minh said the city would offer favourable conditions for Chinese investors with long-term projects in hi-tech farming, ‘green’ technology and food processing.
Minh also said the city has offered preferential policies for businesses from Shandong who invest in the city’s Hi-tech Park and Information Technology park as well as available Industrial Zones.
The two cities set up a relationship in 1994, but trade and investment progress has failed to reach its full potential.
In 2012, the two sides agreed a Memorandum of Understanding (MoU) on tourism cooperation and the investment environment.
According to a report from the industry and trade department, the city of 1 million consumes 145,000 tonnes of seafood and 140,000 tonnes of vegetables per year. However, the city’s 80ha of farms only provide 10 per cent of daily vegetable demand.
In terms of tourism, Đà Nẵng hosted 443,000 Chinese tourists, 27 per cent of total foreign visitors – in 2016.
International cooperation to improve workers’ skills
Vietnam needs skilled workers in many sectors to maintain economic growth. International cooperation in training is the best way to ensure a qualified labor force.
Of 15 countries sending trainees to Japan, Vietnam is the second biggest contributor, just behind China. President of the Japan International Training Cooperation Organization (JITCO), Kazuhiro Suzuki, said the number of Vietnamese trainees in Japan increased from 10,000 in 2013 to 40,000 in 2016.
They work in electronics, mechanics, garments and textiles, seafood processing, construction, shipbuilding, and nursing.
Japan’s 2016 Law on Intern Training for Foreigners generated opportunities for Vietnamese workers to sign 5-year contracts instead of 3-year contracts and receive more benefits.
Mr. Suzuki said, “Vietnam has sent large number of intern-workers to Japan. We’ll inform Vietnam of the latest policy adjustments and offer consultations to obtain the best training cooperation result.”
Vietnam has seen huge labor shifts from agriculture to other sectors. The government needs to help these workers train to take new jobs.
The Asian Development Bank (ADB) has committed to help Vietnam implement the Skills and Knowledge for Inclusive Economic Growth Program.
ADB Vietnam representative Sakiko Tanaka said that ADB has been working with MOLISA and other Vietnamese partners.
The program will be a good model of collaboration between the Vietnamese government, MOLISA, and some investment components to be led by some vocational training businesses.
International cooperation in vocational training is the key to building a high-quality labor force which helps improve Vietnam’s competitiveness in the international labor market.
Vietjet Air begins new service to Siem Reap
Vietjet Air has started a new flight service to Siem Reap reinforcing its commitment to strengthen its footprint in the Southeast Asia region.
The flight time between Hanoi and Siem Reap is about one and three quarters of an hour each way. The flights are currently scheduled to operate daily.
The inaugural flight departed from Hanoi at 4:55pm yesterday (Mar. 30) and arrived in Siem Reap at 6:40pm. The return flight from Siem Reap left at 7:30pm and arrived back in Hanoi at 9:15pm.
Vietjet Air is currently offering highly discounted fares for the service with prices beginning as low as US$18 (VND399,000) each way.
HCM City to host tech forum Smart Emotion
More than 250 exhibitors will take part in a digital and technology forum to be held in HCM City from April 12 to 14.
Smart Emotion will feature three exhibitions -- the 2017 Việt Nam International Broadcast and AV Show, the 2017 Việt Nam International LED/OLED and Digital Signage Show, and the 2017 Smart Tech Show.
Exporum Company, the organiser, said the exhibitors would include companies from many nations and territories, including China, South Korea, Thailand, Indonesia, Taiwan, and Hong Kong.
Thousands visitors are expected, the organiser added.
Many advanced technologies will be on display from many famous brands like Điền Quân Media, Sony, Anh Duy, Rạng Đông, Điện Quang, Hyundai, Arirang, Xiaomi, and Seoul Semicondutor.
The event will also have a business matching session, a hackathon competition, a start-up conference and a lucky draw.
It will be held at the Sài Gòn Exhibition and Convention Centre in District 7.
Tetra Pak Vietnam building factory in Binh Duong
The Tetra Pak Vietnam JSC will invest $110 million in building a factory in southern Binh Duong province this year, according to General Director Mr. Robert Graves.
Construction of the factory, with a capacity of 20 billion packaging products per year, is expected to be completed in 2019.
Vietnam is among the Top 10 biggest consumption markets of the Tetra Pak Group, he went on. Per person consumption of milk, however, a major user of Tetra Pak’s products, remains relatively low, at only 22.7 liters per person per year, compared to an average of 80 to 120 liters in Australia, the UK, Canada, and the US.
“We expect milk consumption in Vietnam to reach 28 liters per person shortly,” he said.
He also said that changes in Vietnamese drinking habits is helping Tetra Pak to develop.
The size of Vietnam’s dairy market is about 2.1 billion liters. White milk is nearly 900 million liters, of which more than 90 per cent is in liquid form. Consumption of other milk products, such as flavored milk, milk for infants and children, and powdered milk, is also quite high.
“The trend towards liquid milk will increase as consumers seek more convenience,” Mr. Graves predicted.
Tetra Pak sold about 7.5 billion packaging products in 2016, primarily to the dairy industry.
The Binh Duong factory will not only supply the domestic market but also the export market in Asia.
Tetra Pak Group has 42 factories around the world. Once in operation, its Vietnam’s factory will be one of its five largest.
From 2010 to 2015, milk production in Vietnam increased nearly 70 per cent, from 1.2 billion liters to 2.1 billion liters, according to Euromonitor research.
VIB posts 7% growth in pre-tax profit
Vietnam International Bank’s (VIB) before-tax profit in 2016 was VND702 billion (US$30.9 million), up 7 per cent year-on-year, the bank’s financial results released on Friday revealed.
Last year was quite a successful year for VIB as it achieved most of the targets set during its general shareholders’ meeting, the bank said.
In 2016, VIB’s total assets rose sharply to VND104.5 trillion, surging 24 per cent compared to 2015, and 16 per cent higher than the target set. The bank’s deposits also recorded an annual growth of 11 per cent to touch VND59.26 trillion. Its credit growth rate was 24.7 per cent, while lending balance reached VND60.18 trillion, up 26 per cent year-on-year.
As per the latest data, VIB has managed to balance sources of deposit to meet credit growth demands, considering the State Bank of Viet Nam’s (SBV) tightly controlled liquidity ratios. The bank’s short-term deposit to medium- and long-term loans ratio was 47.1 per cent, while its loan to deposit ratio was 65.6 per cent, much lower than the maximum 80 per cent limit set by the central bank.
In 2016, VIB took various steps to strengthen and improve its early credit risk warning and credit risk identifying systems.
Along with the implementation of credit quality management measures, the bank also focused on dealing with its old non-performing loans (NPL). The bank’s NPL ratio decreased to 1.5 per cent last year (excluding bad debts bought from Viet Nam Asset Management Co, or VAMC) from 2.07 per cent in 2015. As of December 31, 2016, the bank’s NPL ratio (including bad debts bought from VAMC) was 2.58 per cent, while the VAMC lending balance reduced by 30 per cent.
VIB and Vietcombank are the first two banks to have bought bad debts from VAMC to help speed up the bad debts handling process.
VIB’s Basel II project is in its final preparatory phase for implementation, in line with the SBV’s deadline, the bank said.
UK oceanography centre brings expertise to VN expo
The UK’s National Oceanography Centre sent a delegation to HCM City for the international maritime exhibition INMEX Vietnam which ended on March 31.
The visitors, marine scientists and executives, had a booth at the three-day expo and organised seminars and networking sessions.
“This is the first time that NOC has come to Southeast Asia with such a delegation,” Kevin Forshaw, NOC’s associate director for innovation and enterprise, said.
“NOC collaborates extensively with industry, transferring its knowledge and developed technology to improve business operations and help drive innovation for new product development.
“Key themes within the NOC’s global partnerships programme will be to promote resilience to climate change, food and energy security, Blue Economies and innovation in marine technology.”
NOC is home to Europe’s largest fleet of autonomous and robotic vehicles and also manages two state-of-the-art scientific research vessels.
Viet Nam’s maritime industry has tremendous potential as many experts acknowledge.
It has a favourable geographical location, with 3,200 kilometres of coast, 127 ports, 1,900 kilometres of navigable inland waterways, and proximity to major international maritime routes.
With the Government’s support and private investments, the maritime industry is set to develop and grow rapidly, according to experts.
Petrol pump seals increase tax collection
Petrol pumps in all stations nationwide will carry stamped seals by the end of this month as a measure to prevent tax losses and limit fraud, the General Department of Taxation announced on Friday.
Tax departments in 46 provinces and cities nationwide have completed the stamping of pumps, and 12 other localities are in the process of doing so.
Only five localities, for various reasons, were yet to start implementing this measure, the department said at a meeting held in Ha Noi.
Nguyen Van Thuy, Deputy Director of Large Enterprise Department under the General Department of Taxation, said the stamping plan has significantly improved petroleum management on a national scale and should apply nationwide in the shortest possible time.
Some petroleum dealers with large market shares, like the Viet Nam National Petroleum Group (Petrolimex) and the Military Petroleum Corporation have supported this measure as it does not have a negative impact on their operations.
Besides, it helps increase revenues to the State Budget, creates a healthy business environment for petrol traders, and protects the rights of consumers.
In September 2016, the Minister of Finance sent a written request to tax authorities in provinces and cities to create a management scheme for petrol business operations, basically by supervising pumps at local petrol stations.
Following this, joint teams comprising officials from different agencies were organised to stamp seals on petrol pumps nationwide.
The seals have been prepared and managed by the Directorate for Standards, Metrology and Quality. Local tax departments will monitor sales at the pump, opening and closing the seals at regular intervals.
Any discrepancy found in tax declarations made by traders and supplier invoices will attract sanctions and due taxes collected.
The General Department of Taxation estimates that after the new measure became operational, the collection of environmental protection tax levied on oil and gas consumption increased by 10 per cent.
In Quang Ninh, the northern province where all pumps were stamped and sealed by November 2016, the monthly average fuel consumption and environmental protection tax collected have risen by approximately 15 per cent. A corresponding increase of 14 per cent was seen in Thai Binh Province. In Nghe An Province, where the plan began implementation in June 2015 and was completed by November the same year, the increase was 20 per cent.
The General Department of Taxation said it would continue to direct tax departments of cities and provinces to promptly advise and guide provincial authorities in implementing the scheme, and at the same time, standardise and synchronise evaluation criteria to accurately assess the results of the campaign.
2017 salary guide reveals top-paying jobs
Adecco Vietnam has launched its fourth Salary Guide, which includes an update and overview of salary information for key positions in various sectors and industries.
It covers seven industries in which the company specialises, such as finance and banking, legal and compliance, office, sales marketing and events, information technology, engineering and technical fields, and medical and life sciences.
It is based on Adecco Vietnam’s permanent positions and client and employee needs.
The information includes job description, salary range and years of work experience.
Andree Mangels, general director of Adecco Vietnam, said “While Viet Nam has an abundance of young labourers, youth unemployment remains high as the gap between academic training and real world business skills has widened. Talent shortages, especially among senior level jobs, continue to be a challenge for businesses as companies tried to engage and retain their existing talent base.
“While compensation plays a key role in employee retention, firms are exploring different ways to keep their key talent engaged without getting caught in a pay-inflation spiral.”
Adecco Vietnam Salary Guide 2017 aims to provide companies the insights they need to meet emerging salary expectations in order to attract and retain talent, Andree said.
It is available for free download at the company’s website adecco.com.vn.
The salary guide was undertaken in seven countries in Asia Pacific: Singapore, Thailand, Hong Kong, Taiwan, Korea, China and Viet Nam.
Malaysia promotes medical tourism in HCM City
Penang Medical Tourism Health Talk and Exhibition opened in HCM City on Saturday with the participation of six leading general hospitals and health organisations from Penang and many Vietnamese businesses.
The two-day event featured many professional talks on cardiovascular and urologic diseases, rectum cancer and other topics.
Dr. Mary Ann Harris, chairperson of the Penang Centre of Medical Tourism, who led the delegation to Viet Nam, said Maylasia is currently ranked among the world’s top health tourism destinations thanks to its affordable, high quality medical treatment.
According to the Malaysian Health Travel Council, about 60 per cent of all medical tourists coming to Malaysia go to Penang.
Penang is also named the second top destination to visit in 2017 by CNN, she said.
Bui Thi Thanh An, deputy director of the Viet Nam Trade Promotion Agency, said in recent years, tourism service combined with medical treatment is a new developing trend in the Asian tourism industry.
The event will help Vietnamese businesses to understand more about Penang’s medical tourism sector as well as boost co-operation between the two sides in the sector.
HCM City fails to hit Q1 growth target
Despite higher growth than in the same period last year, HCM City has fallen short of its economic growth target in the first quarter.
Its GRDP was worth nearly VNĐ235 trillion (US$10 billion), an increase of 7.46 per cent year-on-year compared to 7.08 per cent a year earlier.
The services sector expanded by 7.95 per cent (7.8 per cent a year earlier) and industry and construction by 6.67 per cent (the respective rate was 6.25 per cent).
Retail sales topped VNĐ227.5 trillion ($9.8 billion), an increase of 12 per cent.
Revenues were worth VNĐ86.6 trillion ($3.8 billion), or nearly 25 per cent of the full-year target and an increase of 18.56 per cent.
The city’s designated four key industries -- engineering and automation; electronics; chemicals – rubber – plastics; and food processing -- continued to perform strongly, expanding markets, investing in technology, improving quality and competitiveness and growing at nearly 9 per cent.
“The electronics industry … grew at 14.2 per cent … and this is the highest [quarterly] increase in the last few years,” Phạm Thành Kiên, director of the city Department of Industry and Trade, told an economic review meeting yesterday.
A study by the department found that of the mobile phones used by city dwellers, 42.7 per cent were made in Việt Nam. The numbers were 50.9 per cent for laptops and 58.3 per cent for television sets.
According to the city People’s Committee, enterprise support programmes have achieved good results, with the business and investment environment improving.
This has strengthened confidence among investors and entrepreneurs in the city’s economic potential.
This is demonstrated by the investment the city managed to attract -- of nearly $575 million, an increase of 56.7 per cent year-on-year – an expert working for the city administration said.
Around 8,000 new companies with a combined registered capital of VNĐ99.5 trillion ($4.4 billion) received licences during the quarter, increases of 14 per cent and 61.7 per cent.
Some 1.58 million foreign visitors arrived in the city, an increase of 15 per cent, and the tourism sector reported a turnover of VNĐ27.8 trillion ($1.23 billion), a 15.6 per cent rise.
“Though we have achieved positive results in the first quarter of this year, to accomplish the yearly plans, we must work hard,” Nguyễn Thành Phong, the chairman of the city People’s Committee, said.
While first quarter growth was 7.46 per cent the city targets 8.4 – 8.7 per cent growth for the full year, he pointed out.
Industries and local administrations need to take strong measures to achieve the targets, he said.
“Key and supporting industries and the trade and services sectors must speed up their growth.”
The city has already cut or suggested cuts to administrative procedures, especially with respect to insurance, land, taxation, customs, and labour, to help businesses cut costs, he said.
Võ Văn Hoan, head of the People’s Committee Office, called for setting up a task force to deal with investment and construction, which have been identified as problems, and supporting enterprises to improve the city’s ranking in the Provincial Competitive Index.
Phu Yen biomass power plant joins national grid
The biomass power plant invested by the KCP Vietnam Industries Limited in the south central province of Phu Yen was connected to the national grid on April 2.
The India-invested company commenced the construction of the factory in 2015 in the mountainous district of Son Hoa after its sugar plant in the locality raised capacity to 8,000 tonnes of sugarcane per day.
The power plant fuelled by bagasse has a designed capacity of 60 MW and a total investment of nearly 1.3 trillion VND (57.1 million USD).
The first phase of the project has been completed with a capacity of 30 MW and it is able to generate over 70 million kWh of electricity annually.
The company is carrying out the second phase of the power plan along with raising the capacity of the sugarcane processing plant to 10,000 tonnes per day.
Director General of the KCP Vietnam Industries Limited K.V.S.R Subbaiah said the company also hopes to invest in processing side products of sugar production such as alcohol and microbiological fertilizer.
Malaysian firms keen on business expansion in Vietnam
Up to 38 percent of Malaysian firms chose Vietnam as their favoured Asian destination for business expansion in the next 3-5 years, according to the 2016 Asian Enterprise Survey released by the United Overseas Bank (UOB) on March 31.
The firms said they were drawn to Vietnam’s stable political climate (44 percent), huge and growing customer demand (42 percent), and favourable tax and regulatory environment (32 percent).
Vietnam continues to be attractive for foreign investment thanks to its 6 percent growth and a young workforce base with 60 percent of its 90 million population aging below 35.
The findings were taken from more than 2,500 interviews granted to financial planners working for Malaysia-based Asian enterprises which have been in operation for at least three years and earn at least 3.5 million USD each year.
UOB Malaysia Chief Executive Officer Wong Kim Choong said Malaysian investors in Vietnam mostly operate in export-oriented industries such as manufacturing, health care, pharmaceuticals, construction and real estate, adding that they also look forward to more opportunities brought about by Vietnam’s free trade agreements with the European Union and the Eurasian Economic Union.
UOB has noticed Vietnam’s strategic importance since 1995 when the bank opened a branch mostly serving foreign businesses in the country, he said.
Japanese floriculture firm to invest in Lam Dong
Japan’s Kawasaki Flora Auction Market company plans to invest in floriculture in Da Lat city, the Central Highlands province of Lam Dong, for export to Japan and European countries, said former Counsellor from the Vietnamese embassy in Japan Dao Ngoc Canh.
According to him, the company wants to do business for up to 50 years in Da Lat or the entire province.
In the first year, it plans to work on a site of 10-20ha, and expand to 50ha after three years and 100-200ha from the fifth year and afterwards.
Established in 1961, Kawasaki currently owns production facilities in 12 Japanese prefectures and foreign countries such as Colombia and Kenya which provide fresh flowers for its chain of stores across Japan.
President of the Vietnam Cooperative Alliance Vo Kim Cu vowed all possible support for bilateral partnership and asked the Japanese investor to devise specific cooperation plan soon.
He also suggested tapping Lam Dong province’s vast area of fertile land by investing in vegetable cultivation and other agricultural activities there.
Vietnam real estate association convenes annual meeting
The Vietnam Real Estate Association (VNREA) convened its annual meeting in Quy Nhon city, the central coastal province of Binh Dinh on April 1, with 500 delegates representing firms and members taking part.
Apart from the official meeting, the VNREA’s executive board also converged a plenary session to adopt its 2017 action plan and witnessed the signing of a cooperation agreement with the Cambodian Valuers and Estate Agents Association (CVRA).
Speaking at the event, Deputy Minister of Construction Bui Pham Khanh said as much as 92 trillion VND (4 billion USD) was poured into real estate developments as of the end of the first quarter this year, adding that the ministry has received and considered VNREA’s recommendations to refine relevant legal documents, thus creating a favourable and transparent environment for the property market.
VNREA Chairman Nguyen Tran Nam affirmed that the real estate market is developing stably with growing foreign direct investment and improved liquidity.
The association will focus on expanding ties with its counterparts in Southeast Asia in the near future, thereby creating favourable conditions for both sides to navigate each other’s markets, he said.
According to him, VNREA is looking to join relevant professional organisations on the global scale as well as host the World Real Estate Congress in the country, which he said, will enable Vietnam to popularise its property market, tourism and the people to international friends.
The VNREA’s annual conference provides a venue for developers to meet policy makers, leading experts and foreign associations in the field.
Peugeot Scooters celebrates return to Vietnam
French automaker Peugeot held an event at the Vietnam Embassy in France on April 1 to mark the return of its high-end scooters to the Southeast Asian country after 60 years.
At the event, Vietnamese Ambassador to France Nguyen Ngoc Son said the comeback reflects the Vietnamese market’s appeal to foreign investors.
Peugeot Scooters’ distribution network in Vietnam will benefit local consumers in terms of prices and services, he added.
Eric Mougin, Marketing and Style Director at Peugeot Scooters, said the company has studied the Vietnamese market to come up with a suitable business strategy.
Peugeot scooters were once very popular in Vietnam, while recent technologies have made them cope well with the local weather conditions, he noted.
He said Peugeot sees little competition in the local market segment of high-end scooters, expressing his belief in potentials and opportunities Vietnam could offer.
The event also honoured two French nationals – Samuel Felice and Ambroise Prince, who have travelled from Paris to Ho Chi Minh City on the Peugeot Django scooter. Their journey spanned 12,000 km through 14 countries.
The men said they were inspired by a journey on Peugeot S57 scooters from Sai Gon (now Ho Chi Minh City) to Paris made by two French 60 years ago.
They said the memorable road trip has enabled them to meet interesting people and behold beautiful landscapes.
Peugeot is placing high hope on success in the Vietnamese market for further expansion to neighbouring markets, such as China, India and Indonesia.
HCM City - A growing base for Japanese investment
Ho Chi Minh City and Japanese firms discussed investment opportunities at a business-matching event held in HCM City on March 30.
At the event, more than 100 participants, including representatives from HCM City companies and 11 members of Junior Chamber International Japan (JCI), met to discuss potential business deals in various fields, including finance, industry and service, as well as in industrial zones.
Kentaro Harada, chairman of JCI, said that Vietnamese industry and service sectors had been developing well and that the country had become an ideal destination for investors, but that it needed to attract more investment to speed up industrial growth.
He said Japanese companies should not miss the chance to invest in the industrial, service and consumption sectors in Vietnam.
Steve Bui, chairman of Delta E&C Japan, said that Vietnam had great potential.
He said that, through co-operation with Japanese companies, domestic companies would have opportunities to apply modern technologies and improve product quality.
Japan is one of Vietnam’s key investors. As of the end of last year, Japanese companies had invested in 3,280 projects in the country, worth a total of 42 billion USD, equivalent to 14 percent of total foreign investment in the country.
Bilateral trade between the two countries continued to increase in recent years, with average annual growth in the last 10 years of 13.9 percent.
Trade volume by 2020 is expected to be 60 billion USD, compared to 9.93 billion USD in 2006 and 30 billion USD now.