BUSINESS IN BRIEF 27/6
Site clearance solutions sought for Long Thanh airport
An inspection team led by Deputy Minister of Transport Le Dinh Tho on Saturday made a field trip to Dong Nai Province and worked with the provincial government over site clearance, compensation and resettlement for the Long Thanh International Airport project.
Data of Long Thanh District, Dong Nai Province shows about 5,000 hectares of land should be cleared to make room for the project with 4,730 households and 26 organizations to be reallocated. Around 70% of 15,000 affected people are farmers and the rest are rubber workers and those working for other sectors.
It would be hard for people aged over 45 to change jobs or work for factories. Moreover, land prices in the airport area have snowballed, making it difficult for the affected people to buy land there to build new homes.
At the meeting, Deputy Minister of Transport Le Dinh Tho said there need to be solutions and policies to support the affected people to find new jobs. Dong Nai Province should ask the central Government to disburse VND5 trillion (about US$220 million) as pledged for site clearance, resettlement and compensation for the project, he said.
The National Assembly (NA) on June 19 approved a proposal for separating compensation, site clearance and resettlement from the Long Thanh International Airport project and treat them as a sub-project to boost the pace of airport construction.
According to a report of Dong Nai Province, costs of site clearance, compensation and resettlement are estimated at VND23 trillion (over US$1 billion). However, the total amount which the Government has allocated for these components in the medium-term public investment plan for the 2016-2020 period is only VND5 trillion.
Where the remaining VND18,019 billion comes from is not known. In a report sent to the NA, the Ministry of Planning and Investment said it will work with the Ministry of Finance and the Ministry of Transport to consider using backup funds for medium-term public investments to finance the project.
The Long Thanh International Airport project will be executed in three phases at a total cost of VND336.6 trillion (US$16.03 billion).
In phase one, which requires VND114.45 trillion (US$5.45 billion) and is scheduled for completion in 2025, a runway, a passenger terminal, and other auxiliary facilities will be built, with a capacity of 25 million passengers and 1.2 million tons of cargo a year.
A second runway and terminal will go up in the second phase, so raise the airport’s annual capacity will rise to 50 million passengers and 1.5 million tons of cargo. The airport will be capable of handling 100 million passengers and five million tons of cargo a year after phase three is complete.
HCMC seeks to retain 10% of import-export tariff revenues
HCMC plans to ask the central Government for approval to retain 10% of import and export tariff revenues so that it could have an extra VND43.4 trillion (US$1.91 billion) in 2017-2020 to finance much-needed investment projects.
Under the current regulations, all import and export tariff revenues in the city must go straight to the central State budget.
According to the HCMC Institute for Development Studies, the city’s 2016 value added, import, export and special consumption tax revenues were estimated at VND172.18 trillion, accounting for 15% of the city’s gross regional domestic product (GRDP).
Import and export tariffs, and VAT and special consumption tax for imported goods reached over VND100.8 trillion, representing 8.79% of the city’s GRDP.
The legal basis for the city’s plan is Resolution 16-NQ/TW dated August 10, 2012 on directions and tasks for development of HCMC until 2020. The resolution mentions the possibility of using the State budget and regional import and export tax revenues to partially fund the city’s major projects and programs.
To finance traffic infrastructure and port projects to boost economic growth, the city will request the central Government to allow it to keep 10% of annual import and export duty revenues for a period of 10 years. The city’s tax collections from import and export operations in 2017-2020 are forecast to amount to VND434 trillion, so if approval from the central Government is forthcoming, the city would have an additional amount of VND43 trillion in the four-year period.
The municipal government will also propose higher tax on some luxury goods and services. At the same time, the city wants to impose some new fees on the transport and environment sectors.
The central Government has assigned the city to contribute VND348 trillion to the State budget in 2017, up by VND43 trillion against 2016, but revenues shared for the city will total only VND60.3 trillion, up by a mere VND1.3 trillion versus last year. Meanwhile, the ratio of retained revenues for the city is down from 23% to 18%.
Long An to supply safe food for HCMC
The HCMC Food Safety Board and the Department of Agriculture and Rural Development of Long An Province last week signed an agreement on cooperation in agricultural goods production, trading and consumption to ensure food safety.
Long An is the first province to cooperate with the board to supply HCMC with safe agricultural products.
The board earlier visited Phuoc Thinh Service Trading Production Agriculture Co-operative in Can Giuoc District and San Ha chicken processing facility in Ben Luc District, Long An.
The supply chain of farm produce with clear origin will be strictly controlled.
The two sides will jointly inspect vegetables, meat and seafood suppliers in Long An to make sure food is secure.
HCMC authorities will create favorable conditions for Long An suppliers to gain access to the city market through fairs and workshops, and cooperate with HCMC partners, such as wholesale markets, supermarkets and retail stores.
Monthly import-export tax revenue in HCMC hits record high
The HCMC Customs Department collected a staggering VND10 trillion (US$440.3 million) in import and export taxes from May 15 to June 15, a record high in months.
The city’s import and export tax revenue in January-June has amounted to VND53.2 trillion, increasing 9.9% compared to the same period last year and accounting for 48.8% of the full-year target of VND109 trillion.
Therefore, the department will have to collect VND55.8 trillion in the rest of the year.
The department credited the rise to a pickup in tax collections from key imported products, including iron, steel, completely-built-up (CBU) autos under nine seats, computers, and electronic products and parts, according to a report the department sent to the General Department of Vietnam Customs.
However, the department noted, imports of some major products have been in decline, thereby dealing a budget collection shortfall. For instance, fuel imports have plunged, with 981,800 tons imported in the first half of this year, down from over 2.15 million tons a year ago.
The city imported more than 2,500 CBU autos under nine seats worth US$35.08 million in the second half of May while the respective figures in the first half of this month were over 1,600 units and US$20.07 million.
The city saw its January-June export turnover rising 16.8% year-on-year to over US$19.96 billion and its import bill surging 19.3% to US$23.1 billion, leaving a trade deficit of US$3.14 billion.
Mekong Delta rice production to increase despite possible early flooding
The Ministry of Agriculture and Rural Development has called for an increase in fall-winter rice production in the Mekong Delta this year although flooding is forecast to come early.
Speaking at a conference on rice production in the Mekong Delta in Can Tho City on Friday, Deputy Minister of Agriculture and Rural Development Le Quoc Doanh told local authorities to take measures to ensure safety for rice production in the fall-winter season.
According to Doanh, this rice farming season is an important rice season as the price of this food staple is increasing but rice output in the winter-spring season dipped as weather anomaly brought early rain and fewer days of sunshine.
Le Thanh Tung at the ministry’s Department of Crop Production said rice output in the Mekong Delta this fall-winter season is estimated at 4.65 million tons, up by over 446,000 tons compared to the same period last year. The delta’s rice acreage will reach 832,000 hectares, up by 7,071 hectares against 2016, with rice productivity projected at 5.6 tons per hectare, up half a ton per hectare year-on-year.
According to Tung, a spike in rice output in the fall-winter crop can make up for a decrease of 226,095 tons in the winter-spring crop. The rice export outlook is brighter as rice export is expected to grow in both volume and value. All the 13 Mekong Delta provinces now grow fall-winter rice, up from just five around 10 years ago.
Tung said those areas not prone to flooding will be given priority to develop the fall-winter rice crop. Measures will be taken to minimize impacts of flooding on rice farming, including reinforcing dykes, selecting suitable rice varieties and changing harvest, transport and drying methods.
The southern weather center forecast flooding may come in the Mekong Delta sooner than normal this year. In late July, upstream water levels of the Mekong River in Tan Chau District, Dong Thap Province and Chau Doc District, An Giang Province could rise to 2.5-3 meters, exposing Tan Hung and Vinh Hung districts of Long An Province and some farming areas in An Giang and Dong Thap provinces to flood risk.
Data of the Vietnam Food Association showed the country’s January-May rice exports reached 2.3 million tons, up 9.71%, with a total FOB value of nearly US$975 million, up 11.29%, and the CIF value of over US$1 billion, up 12.29% compared to the same period of 2015.
The average FOB price was US$427.17 per ton, up US$6.06 per ton. Vietnamese rice traders signed contracts to export over 3.5 million tons of rice while rice inventory was over 1.15 million tons.
According to the Ministry of Finance, the average rice production cost of the Mekong Delta in the summer-fall crop is estimated at VND3,992 (US$0.18) per kilo, up VND154 per kilo versus the same period last year. Ben Tre Province has the highest rice production cost, VND5,192 per kilo, and Ca Mau Province has the lowest cost, VND3,148 per kilo.
Vietnam’s private sector overburdened with costs
Vietnamese private enterprises are overburdened with formal costs, let alone informal expenses and harassment, so they can hardly develop, experts said at a forum in Hanoi on June 22.
Ho Sy Hung, head of the Enterprise Development Department under the Ministry of Planning and Investment, told the Vietnam Enterprise Development Forum jointly organized by the ministry and Economy and Forecasting magazine that the cost burden imposed by the State is too heavy for private enterprises.
Citing a survey by the Japan External Trade Organization in 2016, Hung said the minimum wage increase in recent years was around 8-12% a year, outpacing annual labor productivity growth of 4-5%. Specially distressful is the high social insurance, at 22% of the total salary fund, far higher than in regional countries, such as 13% in Malaysia and 10% in the Philippines.
The rate of return at private enterprises is worryingly low, at a mere 1.72% compared to the average rate of 6.04% at State-owned enterprises and 6.95% in the foreign investment sector.
Regarding the overall business community, 97.7% of firms are small and medium in terms of labor force, and 94.8% of enterprises are small and medium by capital scale.
For the private sector, such rates are even worse. Up to 98.6% of private enterprises are small- and medium, but the number of medium-sized private enterprises makes up a mere 1.6%. Most private enterprises have fixed assets of VND7-8 billion, and this trivial scale had barely improved throughout the 2011-2015 period.
“Domestic private enterprises are financially incapable of building up fixed assets like machinery and technology to cut costs and improve business efficiency. This is food for thought to policymakers to mull new supportive policies for the sector,” Hung of the ministry said.
Dau Anh Tuan, head of the Legislation Department of the Vietnam Chamber of Commerce and Industry, said bigger enterprises tend to be subject to more inspections by authorities than smaller ones.
“Many small and medium enterprises are satisfied with the business scales since they are fretful over inspections by State administration agencies and the taxman. Some enterprises complained that the day before, they were inspected by the tax agency, and the day after, they were inspected by other State bodies on environment or social insurance,” Tuan told the forum. He added that up to 65% of private enterprises face difficulties in land access.
Vu Dinh Anh, an economic expert, said it is urgent to clarify the role of the private sector in the economy. “When the private sector grows, the economy will also grow. Therefore, it must be clarified that the private sector and the State sector are not mutually exclusive. Rather, they supplement each other in growth,” he said.
HCM City property market to change
HCM City’s real estate market in the 2017-20 period will see major changes as supply and demand will gradually adjust, stabilising and strengthening the market, according to the city’s Real Estate Association.
In its latest report on the real estate market in the second half of 2017, the association said there would be a switch from high-end projects to mid- and low-end segments to meet demand from people with lower incomes.
The emphasis on the low- to mid-end market segment began early this year, the report said.
Thirty-two new housing projects were approved in the first half of the year with a total of 16,505 apartments. Of these, more than 68 per cent were in the mid- and low-end market.
“This is a good sign because developers are re-structuring their products to develop apartments with one or two bedrooms to meet the huge demand of people with lower incomes,” said Lê Hoàng Châu, chairman of the association.
The association said that in the last half of the year, co-operation among developers would be more common as the development trend continues.
Merger and acquisition activities are also expected to increase as the National Assembly’s resolution to reduce bad debt becomes effective in mid-August.
The market is expected to become more stable and transparent when new policies related to tax, credit, planning and administrative procedures become effective.
The association said that investment flows would come mostly from foreign investors and overseas remittances.
Châu said that in the first half of the year, 20 per cent of US$2.1 billion in overseas remittances was poured into real estate.
Nearly 13 per cent of foreign direct investment (FDI) was invested in the real estate market, equivalent to $50.3 million.
“FDI to the sector in the last six months of the year will surge because many contracts to develop property are under negotiation,” he said.
Châu said that infrastructure upgrades, including metro lines and rapid bus routes, would create advantageous conditions for companies to develop in the mid- and long-term.
Developers are expected to focus on projects friendly to the environment to meet the demand of consumers who want modern technologies, including the internet of things (IoT) and artificial intelligence, he added.
In the first half of this year, the city developed 1.92 million sq metres of housing.
During the period, the city continued to upgrade housing, and targeted rebuilding 50 per cent of 474 old apartment buildings until 2020.
As of the end of last year, the city had 13,220 real estate companies.
In the first half of the year, one-third of 18,000 new companies established in the city were real estate companies, with most of them providing real estate services.
SAV & ICAEW sign MoU
The Institute of Chartered Accountants in England and Wales (ICAEW), a world leader in the accountancy and finance profession, and the State Audit Office of Vietnam (SAV) have signed a memorandum of understanding (MoU) to work more closely together.
The agreement between the two was signed on June 26 by ICAEW’s CEO Mr. Michael Izza and Deputy Auditor-General Mr. Cao Tan Khong at a ceremony in Hanoi. It sets out detailed activities that will see the two exchange professional experience and information while tightening cooperation for mutual benefit.
Speaking at the ceremony, Mr. Khong said the development of human resources and international integration are the two core priorities within the strategy for SAV’s development to 2020. “The MoU sets the foundation for SAV and ICAEW to conduct supportive programs in improving professional experience, contributing to the development of talent in Vietnam’s auditing industry to integrate on a regional and global scale,” he added.
“The partnership with SAV will legalize commitments and ICAEW’s will to contribute to Vietnam’s development,” said Mr. Izza said. With ICAEW’s vision of operating for the sustainable development of the global economy, “the operation and activities of ICAEW in Vietnam during recent years have had a positive impact on the enhancement of talent within the accounting sector in general and the auditing field in particular.”
In 2011, ICAEW also signed an MoU with the Vietnam Association of Certified Public Accountants (VACPA) to establish a framework to work together to develop talent and advance the accountancy profession in Vietnam and Southeast Asia.
Mr. Izza affirmed that during the time to come it will continue with these commitments while at the same time conducting more activities to bring State authorities and Vietnamese organizations and businesses closer to the most up-to-date and modern financial and accounting standards.
As an official member of the International Organization of Supreme Audit Institutions (INTOSAI) and the Asian Organization of Supreme Audit Institutions (ASOSAI) since July 1996 and January 1997, respectively, SAV has participated more actively in global cooperation. It has developed and retained extensive relations with numerous external organizations, including a large number of prestigious supreme audit institutions (SAIs) and foreign agencies around the world that have signed bilateral cooperation agreements with SAV.
SAV has defined its development goals and vision to 2020 as to attain enhanced operational capability and legal effectiveness and quality and efficiency in State audits so as to make it a strong tool of the State in controlling and monitoring the management and use of State budget funds and assets, and to build SAV into a highly professional agency that is modernized from phase to phase into a responsible and prestigious position in the field of public finance control, with a view to better meeting the requirements of the country’s industrialization and modernization and being in line with international practice and standards.
With a philosophy “Transparency, Integrity, Professionalism and Brightness”, SAV is now doing its utmost to become a responsible and renowned public finance control agency to ensure Vietnam’s sustainable and prosperous development.
MWG launches BigPhone store in Cambodia
The Mobile World Group (MWG) officially launched its first overseas store, “BigPhone” in Phnom Penh, Cambodia, on June 23, to approach Cambodians and visitors to the country and with a look similar to its stores in Vietnam.
Initially, BigPhone will focus on mobile phones and tablets, which account for 85 per cent of all products in the store. Samsung phones and tablets are in the majority, followed by those from Huawei, OPPO, Camfone, and LG, while Apple and Nokia products will be available in July. The remaining 15 per cent are accessories and SIM and phone cards.
Due to the low consumption in Cambodia, laptops will only be sold when other core products have generated stable revenues. The first BigPhone store is projected to earn average revenue of $100,000 per month.
The launch of other BigPhone stores will depend on the business performance in the first three month of the initial store, which is currently being promoted by roadshows, leafleting, and other marketing activities.
“The fake phone market in Cambodia is an issue, while the training of staff for long-term planning also needs to be considered further,” said Mr. Ho Viet Dong, CEO of MWG in Cambodia.
BigPhone is a trial for MWG in seizing overseas opportunities and testing the company’s systems when operating outside of Vietnam. If things go according to plan, it will calculate the possibility of expanding into Myanmar or Laos, according to the company.
MWG and HAGL signed MoU
MWG also signed a strategic partnership agreement on June 23 with the Hoang Anh Gia Lai Group (HAGL), a multi-sector group from Vietnam that engages in fields from agriculture to power generation, to provide fresh fruit to MWG’s Bach Hoa Xanh chain in Vietnam. This will bring the partnership between the two to the strategic level, with HAGL to accompany Bach Hoa Xanh’s nationwide expansion plans in the future.
The partnership agreement makes clear that HAGL will prioritize Back Hoa Xanh over other exporters or local buyers while at the same time providing a preferential pricing system for Bach Hoa Xanh to ensure its market competitiveness.
Speaking at the signing ceremony, MWG CEO Mr. Tran Kinh Doanh said he believes Bach Hoa Xanh will grow quickly in the time to come, and “our ambition is to grab a substantial share in the consumer retail market” and “we are glad to have HAGL as our companion,” Mr. Doanh added.
For its part, HAGL CEO Mr. Vo Truong Son said that as of now the group has planted thousands of hectares of 17 types of tropical fruit in Vietnam, Laos, and Cambodia, which are all high-quality products. “We believe the Bach Hoa Xanh chain will create prestige within the consumer retail market and via this cooperation will bring our trusted products to consumers nationwide,” Mr. Son added.
According to its 2016 financial report, MWG recorded net sales of VND44.6 trillion ($1.97 billion) and after-tax profit of VND1.57 trillion ($69.5 million), increases of 77 and 47 per cent, respectively, compared to 2015. Its revenue also exceeded the initial annual target by 14 per cent. Over the last five years, MWG’s revenue and after-tax profit have increased by 43.87 and 65.7 per cent per year on average.
UPCoM marks eighth birthday
The capitalisation of the Unlisted Public Company Market (UPCoM) has rocketed 100 times to reach VND444 trillion (US$19.73 billion) after eight years of operation.
The number of traded companies has also risen from about 40 in 2009 to 568 in 2017, making the scale of UPCoM 2.4 times bigger than the listed market on the Ha Noi Stock Exchange.
The secondary market for unlisted companies also recorded a 50-times increase in its daily trading value, which has reached an average of VND197.7 billion from VND4 billion in 2009.
UPCoM was first launched by the HNX on June 24, 2009 to narrow and limit the trading of companies’ shares on the free, unmanaged market and expand the Government-managed market.
After eight years of operation, UPCoM has undergone significant changes to draw attention from businesses and increase its attractiveness to investors by improving its trading criteria and applying the online trading mechanism.
Those efforts have helped companies, whose shares are traded on UPCoM, become listed companies on the HCM and Ha Noi stock exchanges and raise the transparency of both markets and their businesses.
To celebrate the eighth anniversary of UPCoM, the HNX has issued a new mechanism that divides UPCoM into three categories by companies’ market capitalisation in order to improve trading conditions for the secondary market.
The three levels are the UPCoM Large for 40 companies, which have more than VND1 trillion in their charter capital, UPCoM Medium for 70 companies, which have charter capital of between VND300 billion and VND1 trillion, and UPCoM Small for the remaining 379 companies that have charter capital of between VND10 billion and VND300 billion.
The new firm categorisation also marks new efforts of HNX to improve its monitoring and supervision over UPCoM, which has a variety of companies, capitalisation, quality and sectors.
Other markets on the northern securities exchange like bond and listed markets also posted big improvements in their operation.
In the Government bond (G-bond) market, the HNX has raised approximately VND1.4 quadrillion from G-bond auctions between 2006 and 2016 for the country’s socio-economic development.
Investors have become more interested in long-term bonds in recent years, especially 20- and 30-year bonds. By June 2017, the average maturity of G-bonds reached 13.8 years compared to that of 2016 G-bonds at 8.27 years.
In 2016, the G-bond market recorded its repo (repurchase agreement) trading value was equal to 40 per cent of total trading value in the G-bond market, nearly close to outright trading value.
Repo trading value has also risen in the first half of 2017, occupying 47.9 per cent of the total market’s trading value and nearly balancing the outright trading value.
On the listed market, the number of listed companies has increased to 377 in 2017 from 257 in 2009 with total market capitalisation of VND183 trillion and average market trading liquidity in each session reaching VND500-600 billion.
A lot of large-cap firms have become listed on the northern bourse, such as Asia Commercial Bank (ACB), Hai Phong Port JSC (PHP), insurance-finance group PVI Holdings (PVI) and PetroVietnam Technical Services (PVS).
In the future, the HNX will apply the market maker mechanism to increase and improve the trading of listed shares.
Market makers will be able to connect investors together, creating opportunities for low-liquidity shares to be attractive to investors.
In the past eight years, listed companies have raised more than VND69 trillion for their business activities in the context that they have difficulties getting access to bank loans due to high lending rates.
The HNX has worked with the Viet Nam Securities Depository (VSD) and the State Securities Commission (SSC) to develop the derivatives market in order to provide a new product for investors and improve the quality of the Vietnamese securities market.
To make sure the derivatives market operates properly in its early stage, the HNX will launch the first product, which is the futures contract for the VN30 Index, which contains shares of the 30 largest companies by market capitalisation.
After two years of preparation, the HNX has completed developing the facility and infrastructure for the new market and connected with banks, as settlement units, and brokerages, as market members.
Transforming from the Ha Noi Securities Trading Centre on June 24, 2009, the HNX has risen and affirmed its positive position in Viet Nam’s securities market and received a lot of honourable awards from the Government, the State and the finance ministry.
NCB sees major growth from core products and niche markets
From standing at the edge of the abyss, the National Citizen Bank (NCB) has recorded among the highest revenue of commercial banks in Vietnam. This success comes from the determination of its leaders to shift development towards niche markets and also design tailor-made products for each customer segment.
Throughout the recent years, NCB’s net profit has consistently grown at an average of 30 per cent a year. Total assets in 2016 rose 43.1 per cent against 2015 to VND69 trillion ($3.03 billion) and net profit by 90.9 per cent to VND210 billion ($9.2 million), or five times higher than the period prior to its restructuring in 2012.
As at the end of 2016, mobilized capital stood at VND42.76 trillion ($1.9 billion), up 24.9 per cent compared with 2015, while customer deposits were up 24 per cent to VND25.4 trillion ($1.12 billion). Significantly, the bank’s bad debt rate was kept below the 3 per cent threshold, standing at 2.07 per cent of total outstanding credit as at December 31, or three times lower than in the period before restructuring, while loans in Groups 3, 4 and 5 were tightly controlled.
Instead of becoming involved in a race with giant banks, after restructuring it chose its own path by providing specific tailor-made products for customers in each segment. “Trying to win customers from major banks in the retail and wholesale markets would be like hitting our heads against a brick wall,” one NCB Director said. “Major corporate customers have been with banks like Vietcombank and BIDV for a long time, while the individual customer segment has seen fierce competition between large commercial banks and 100 per cent foreign-owned banks.”
Immediately upon restructuring, the bank decided its core customer segment would be most suitable and developed products that would become the specialty of its individual loan segment. In the time to come, “we will continue to design tailor-made products with ‘state-of-the-art’ technology for each and every individual customer, so that NCB will become the most friendly and efficient financial consultant,” the Director added.
The bank’s niche products, such as home loans, car loans, and household business loans saw the highest revenue compared to other products and services in 2016, with total customer loans last year rising two-fold from 2015 to VND26 trillion ($1.14 billion).
From a small bank with only some saving products, after more than 22 years of development and three years of restructuring, 2016 marked a turning point for NCB with the launch of significant new products such as the NCB app for smartphones, NCB Visa Credit Card, and the NCB Priority Customer Center, among others. It now has 2,400 employees and 90 transaction points in major cities and provinces in Vietnam.
During the 2016-2020 period, NCB plans to focus its business in the north while improving customer awareness in the south and in the central region. At the same time, it will transform each transaction point to become a revenue center. After 2018, it will expand its network to the north-west, south-central, and central highlands markets.
It was recently named among the Top 5 leading banks in Bac Ninh, Bac Giang, Thue Thien Hue and other large provinces. Not only gaining success in its business, NCB is also the best bank in Vietnam regarding corporate social responsibility (CSR) activities.
In 2012, it established the NG Community Fund, operating as a non-profit, voluntary organization, raising funds from NCB’s employees and partners. NCB has efficiently used the community fund to create social and welfare bridges, schools for remote children, charity houses for poor people, and sponsorships to people affected by natural disasters and by war.
Maritime Bank provides auto cashback for Clingme users
Maritime Bank on Thursday signed an agreement with Gingatum Viet Nam to provide auto cachback services for users of the startup’s shopping app Clingme.
Accordingly, Clingme users with accounts at Maritime Bank will receive money immediately in their bank accounts when they want to withdraw money from Clingme accounts.
Normally, it takes five days to withdraw cash from Clingme accounts.
Clingme is an app via which users will get cashback of up to 40 per cent on their shopping bills from the company’s partner stores. At present, Clingme has partnered with 2,700 stores in Ha Noi and HCM City.
Founded in 2013, Gigatum has raised funding of US$3 million. The company plans to have one million users at Clingme and 10,000 partner stores by the end of this year.
Sacombank to launch three affiliates
Sai Gon Thuong Tin Commercial Joint Stock Bank (Sacombank) will establish three affiliates between now and 2020, the bank announced.
One of the affiliates will be a financial limited liability company operating in the fields of credit-consumer finance services, finance leasing, credit card services and other related services. It is projected to have chartered capital of VND500 billion (US$22 million). The other two affiliates will be a life insurance company and a general insurance company, with chartered capital of VND500 billion and VND300 billion, respectively.
Sacombank’s annual general shareholders’ meeting will be held on June 30 after being postponed two times. At the meeting, shareholders will discuss the election of the new members of the Board of Directors and the Supervisory Board for the 2017-22 period.
They will also work on the establishment of the three affiliates.
Sacombank’s leaders said that in order to serve the needs of customers, the bank needed to specialise its consumer lending services through the operation of financial companies.
The establishment of new financial company would help professionalise consumer lending services and improve risk management, the bank said.
Regarding insurance services, Sacombank has diversified customers who would help the bank exploit potential in the field and boost cross-selling of products, gradually penetrating the market.
Previously at the 2015 annual general shareholders’ meeting, Sacombank’s plan of establishing a financial company and two insurance companies was approved. However, the plan has not yet been implemented. In 2017, Sacombank aims to increase total assets by 16 per cent to VND384.6 trillion. Total mobilised capital is expected to reach VND356.1 trillion. Total outstanding loans are projected to touch VND277 trillion and pre-tax profit is estimated to be VND585 billion.
Korea scouts for investment opportunities in Can Tho
Officials of Can Tho City in Mekong Delta met with a delegation from South Korea on Friday to explore opportunities for enhancing cooperation in the healthcare and construction sectors.
Haeseung Shin, director of Korea’s Gumi Gangdong Hospital, who is leading the delegation on this investment promotion trip, said Can Tho is among their six destinations, the others being Ha Noi, HCM City, Thai Nguyen, Bac Ninh and Soc Trang provinces.
The delegation had meetings with the Can Tho municipal People’s Committee and People’s Council, Can Tho General Hospital, Hoan My Cuu Long Hospital, and some construction companies, to understand local mechanisms and policies on foreign investment, especially in these two fields, Shin said.
He expressed hope that the city would support Korean businesses in building medical equipment factories, and distributing medical equipment and materials. Shin added that they are also looking to invest in construction, building materials supply, and construction consultancy and supervision.
Truong Quang Hoai Nam, vice-chairman of the municipal People’s Committee, said Korea ranks first among foreign investors in Can Tho City. To create an optimal investment climate for foreign firms, aside from administrative procedure reforms, Can Tho has also paid attention to upgrading both its hard and soft infrastructure, focused towards large healthcare and education projects, Nam said.
In the first half of 2017, the city sent many investment promotion delegations to step up cooperation with Korea in smart city building, hi-tech agriculture and education training, Nam said.
As of this May, Can Tho had nine Korean investment projects with a total registered capital of US$247 million, and the $17.7 million Korea Vietnam Incubator Park, which uses official development assistance (ODA) from Korea.
Another ODA project on supporting agricultural mechanisation in Can Tho is being considered by the Ministry of Planning and Investment, the municipal Department of External Affairs said.
Four other projects sponsored by Korean non-governmental organisations are also underway in the Mekong Delta city, which include healthcare for children and women; and teaching Korean language and culture to Vietnamese women who wish to marry Korean citizens.
In 2016, Can Tho posted $9.5 million in exports to and $6.9 million in imports from South Korea. The figures were $2.1 million and $1.7 million, respectively, in the first four months of this year.
HCMC requests extra VND18 trillion for key traffic and environment projects
The HCMC People’s Committee has proposed the central Government allocate an extra VND18 trillion (US$192.6 million) for two major traffic infrastructure and environment rehabilitation projects.
Metro Line No.1 connecting the Ben Thanh Market in District 1 and the Suoi Tien Park in District 9, and phase two of a water environment rehabilitation project in the basin of Tau Hu-Ben Nghe-Doi-Te canals are in dire need of funding.
Total demand for official development assistance (ODA) capital from the State budget of the two projects is over VND29.5 trillion, with VND20.9 trillion for the city’s first metro line and VND8.5 trillion for the environment project in 2016-2020.
Speaking at a working session last Friday with Prime Minister Nguyen Xuan Phuc, city vice chairman Le Thanh Liem said the city had thrice called for the central Government to inject more finances, otherwise the two projects could stall.
The Ministry of Planning and Investment has so far allocated a mere VND7.5 trillion for the metro line and VND4.01 trillion for the environment project, meeting a slight 39% of the total financial needs of the two projects.
The city cannot complete the projects on schedule if it continues to struggle with funding delays, Liem stressed.
He noted work on the projects has been on schedule but the city is running short of cash to pay contractors in a timely manner. If the situation remains unresolved, the contractors would suspend construction work, which would entail tremendous losses for the city.
The city asked the Government to guarantee as sufficient capital for the projects by 2020 as required in a bid to ensure they can be carried out in line with contract terms to avoid cost overruns and penalties on overdue interest payments, and bring them into operation by 2020, Liem suggested.
At the meeting, PM Phuc approved a city proposal for using proceeds from the sale of shares at State-owned enterprises (SOEs).
The city plans to use about VND67 trillion in proceeds from the equitization and divestment of State-owned stakes at enterprises from 2017 onwards to fund its medium-term public investment plan in 2016-2020 in which urgent projects will be executed.
Besides, the city asked the Government for approval to use more than VND9.9 trillion from the budget of the State Capital Investment Corporation (SCIC) to finance vital flood control projects.
It asked for an extra VND10 trillion to finance traffic and port infrastructure projects like the Tan Son Nhat International Airport, Cat Lai Port, and Hiep Phuoc Port to keep up with growing demand for export and import activities.
Challenges facing State firm equitisations
Most State-owned enterprises still face difficulties after being equitised due to a lack of changes in management, delegates heard at a seminar on Friday.
“The goal of equitisation is to help enterprises re-arrange their structure, but many enterprises do not meet this expectation because there are no changes in management, especially for those firms where the State still keeps a 51 per cent stake,” Le Trong Sang, head of the HCM City Board for Enterprises Management Renewal, was quoted as saying in the Sai Gon Giai Phong (Liberated Sai Gon) newspaper.
Of a total of 32 equitised enterprises during 2013-2015, only 4 of them registered to list on the stock market.
“Turnover of the equitised firms has reduced 1.5 per cent in comparison with the past and only 30 per cent of them are profitable and contribute to the State budget,” Sang added.
Poor management and the price of renting land increasing 12-15 per cent were the reasons for losses.
HCM City still has 42 enterprises which are seeking to be equitised, of which, the Government has a stake of under 50 per cent in 39 of them and over 50 per cent in three.
In addition, 22 public utility enterprises at the district level face a lack of a legal framework to be equitised.
“The most difficult work is how to assess the value of an enterprise, and we should hire an international consultancy to do this work,” he suggested.
By the end of last year, HCM City withdrew a total of VND3.5 trillion ($155 million) from core businesses, such as real estate, banking and insurance and this year, the city will take its capital back from an additional 10 enterprises.
“Right now, there is around VND2.4 trillion ($106 million) needed to be withdrawn,” Sang added.
By the end of 2018, the city plans to equitise 51 enterprises and complete a management model to supervise State assets in equitised enterprises.
At the seminar, delegates thought that the most difficult work in equitisation was how to deal with real estate related matters in joint-ventures because the legal framework for valuing enterprises within joint venture projects hasn’t been released yet, including the value of real estate.
“Meanwhile, strategic investors mostly pay attention to assets and real estate,” Huynh An Trung, general director of Cho Lon Investment, Import-Export Joint Stock Company (Cholimex) said.
Trung revealed that his company spent nearly half a year to identify the value of real estate.
He also pointed out that if the Government only sells a small proportion of its shares, investors did not want to buy because there is no chance for them to change the businesses.
“Another thing we should be concerned about is if we give a high value to enterprises it will be difficult to sell shares because it makes the return on equity (ROE) low,” he added.
“To speed up equitisation for State-owned enterprises, a legal framework should be completed along with improving staff capacity,” Le Thi Hong Hau, party secretary of the HCM City Enterprises Bloc, concluded.
Vietnam companies go on trade mission to South Africa
Representatives of 10 Vietnamese companies are in Johannesburg, South Africa to attend an international trade exposition running June 25-27 in the hopes of establishing new partnerships.
The Vietnam News Agency reports that the topics of the expo include gifts and premiums, houseware and kitchenware, fashion accessories, electrical and electronic products, office equipment and stationery, and toys.
Citing the expansive and continual growth of South Africa, Ambassador Vu Van Dung said in a speech at the opening on June 25 that the region is ripe with opportunity for partnerships with Vietnamese companies.
Companies that are on the trip include the Thang Long Food Processing Company, Sunhouse Joint Stock Company and Toan Thien An Company that specialize in processing seafood, housewares and fashion accessories.
More than 652 companies from 34 countries around the globe attended last year’s exhibition in Johannesburg to exhibit their wares, said Ambassador Dung, adding that 12,480 visitors from 72 countries attended it.
European SMEs look to rule changes
More European small-and medium-sized enterprises are finding Vietnam a favourable destination for investment in anticipation of the EU-Vietnam Free Trade Agreement and a new law supporting small-and medium-sized firms.
The EU-Vietnam Free Trade Agreement (EVFTA) is expected to be ratified and come into force in 2018, while Vietnam’s Law on Supporting Small-and Medium-sized Enterprises (SMEs) was ratified in this June and will become effective from January 1, 2018.
Tran Vu Hanh, a partner DFDL Vietnam law firm, told VIR that Vietnam’s commitments under EVFTA for certain service sector is higher than in other trade pacts.
For example, EU companies can form joint ventures with Vietnamese partners (with foreign equity not exceeding 51%) to provide equipment, rental, and leasing services in Vietnam-as such services are unbound under the country’s World Trade Organization (WTO) commitments.
European companies are also keen on the incentives of the Law on Supporting SMEs in addition to the Law on Enterprises and the Law on Investment.
“Foreign companies will benefit from the new law if they meet the criteria applicable to SMEs in Vietnam, including: having no more than 200 employee contributing social insurance and total capital not exceeding VND100 billion (US$4.4 million) or having no more than 200 employees contributing social insurance and the previous year’s total revenue not exceeding VND300 billion (US$13.2 million). Investors will have to wait, however, for decrees containing governmental guidance on the implementation of the law,” she said.
According to Thomas McClelland, chairman of EuroCham’s Tax and Transfer Pricing Sector Committee, the new measures contained in the Law on Supporting SMEs will make good on the government’s pledge to encourage private firms and create a favourable environment to support startups and innovative enterprises.
The law will benefit both local enterprises-which contribute nearly 50% of Vietnam’s GDP-and foreign-invested SMEs. The reduction in the corporate income tax rate to 17%, simplification of accounting and tax filling procedures, and better access to credit will be a boon to EU-invested SMEs in light of the coming enforcement of EVFTA.
EVFTA is an innovative and ambitious deal, covering a wide range of areas from trade to sustainable development and touching many economic sectors. The foreseeable benefits include tariff removal, lower import costs, trade liberalisation, global value chain expansion, competitive advantages maximisation, and supply diversification.
The agreement is set to bring more business and investment opportunities to companies from both sides, while also establishing innovative investment protection mechanisms.
Nicolas Audier, vice chairman of EuroCham, said that EVFTA will be a landmark event in the relations of Europe and Vietnam, and has the potential to foster one of the most dynamic intercontinental trade corridors in the world.
“But EVFTA is not only about trade and investment, it will also bring a new attitude towards business,” he said. “It will create conditions for European knowhow and SMEs to reach Vietnam more easily, with new cutting-edge, smart, and environmentally-friendly solutions and technology. SMEs are the fabric of Europe and Vietnam’s business landscape, and they will benefit from the new environment established by the agreement.”
EuroCham’s Business Climate Index for the first quarter of this year shows that businesses are already anticipating EVFTA. Indeed, firms’ satisfaction scores have jumped to a record level of 86 out of 100. This positive evaluation is thought to be related to the performance of Vietnam as a market, but also to the coming deal.
Vietnam, an emerging market for US beef
Over the past few years, the American Brahman Breeders Association and US Brahman breeders have been cultivating a new business relationship with the agriculture community in Vietnam.
Vietnamese cattlemen, says the Brahman Journal, are now importing bulls and other breeding stock looking to utilize American Brahman genetics and husbandry techniques on a massive scale to boost in-country beef production.
The Vietnamese cattle breeders are primarily interested in Red Brahman genetics. Most of their domestic cattle herd is derived from Red Sindhi, a popular Zebu dairy breed that originated in Pakistan, and the agricultural community in Vietnam prefers the Red Brahman genetics as they are used to red Bos indicus cattle.
Vietnam is one of the fastest-growing markets for US food and agricultural products. US exports to Vietnam totalled more than US$2.3 billion in 2015, a 357% increase from 2007, which is the year Vietnam joined the World Trade Organization.
Vietnam ranks as the US eleventh largest agricultural export market.
The ABBA and the Holstein Association USA conducted a successful trade mission to Vietnam October 29-November 7, 2016.
The focus of the trade mission was to introduce and promote US beef and milk breeds and demonstrate how the utilization of high quality genetics could help develop the Vietnamese cattle segment.
We don’t do many trade missions, said one of the leading representatives on the trade mission, noting that the case of Vietnam is different. Vietnam is a new, emerging market, and the people there are very excited about the American Brahman.
During the trip, the trade mission conducted an educational workshop in Ho Chi Minh City that was attended by more than 80 producers, key leaders and government officials.
Participants included representatives from the Ministry of Agriculture and Rural Development, agriculture departments from several provinces, veterinarians, agriculture engineers as well as large animal corporations and producers.
The workshop was held at the Caravelle Hotel meeting facilities and was highly publicized with national television and newspaper coverage. The workshop covered a variety of topics from genetics, environment and housing to importation procedures and management.
After the workshop, the trade delegation participated in ranch tours as well as meetings with government officials. They also visited the Ruminant Husbandry Centre and the National Institute of Animal Science in Vietnam. These visits allowed them to meet many individuals and organizations vital to the beef and agriculture industries in Vietnam.
The Vietnamese cattlemen are very interested in growing their beef cattle segment, and there is a substantial demand for more American Brahman genetics to be imported into their country, said the leading US trade representative.
In addition to providing the Vietnamese agricultural community with information about the Brahman breed, the trade mission worked to facilitate talks between them and animal science professionals in the US.
The Moncada Breeding Station - Vietnam Ruminant Breeding Centre in Hanoi is currently the only cattle semen collection station in the country, and it is run by the government. To bolster the country’s beef and dairy cattle genetics, the centre collects bulls and sells semen to citizens at an economical rate.
Over the last two years, the Moncada station has imported 20 Red Brahman bulls from breeders in the US.
The first shipment consisted of ten young, breeding-age Red Brahman bulls from top ranches in Texas and Louisiana, including K Bar Farms, Detering Red Brahmans, Broken Triangle, Oden Ranch, 4L Cattle and a few others.
During the US 2016 trade mission, the breeding station made a verbal commitment to import ten more bulls, due to the success of the 2015 importation and the high demand for American Brahman genetics.
In March of 2017, Alfredo Muskus of Santa Elena Ranch in Madisonville, Texas escorted the second shipment of Red Brahman bulls on their journey to Vietnam.
The bulls were selected from top breeders including HK Cattle, Detering Red Brahmans, Santa Elena Ranch, Canyon Creek and Rich Cattle Company. They were between a year and eighteen months old.
World Wide Livestock Express handled the quarantine, and TK Exports, Inc. managed the exportation of animals from Houston, Texas to Hanoi.
It was an incredible experience, Alfredo said. The hospitality was great, and the people were very excited about the quality of the American Brahman bulls and the semen collected from previously imported animals. I am enthusiastically looking forward to working with them again in the future.
HCM City eyes boost to dental tourism
Dental tourism has been identified as one of Ho Chi Minh City’s five main medical tourism products, according to its Department of Tourism.
Every year Vietnam gets around 100,000 medical tourists from many countries, including the UK, France, Australia, the US, and Cambodia, Bui Ta Hoang Vu, Director of the department, said.
Dental care, cosmetic surgery, traditional medicine and acupuncture, screening for diseases, and artificial insemination, which are keeping pace with regional standards, are promising medical tourism products, he said.
But dental care in Vietnam costs only half or a third of the cost in neighbouring countries, he said.
On June 24, the department in coordination with the Department of Health organised the first ever dental tourism fair at the Independence Palace.
“It is a great opportunity to introduce new dental tourism products to domestic and foreign visitors,” Vu said.
Nguyen Duc Minh, Director of the HCM City Hospital of Odonto-Stomatology, said the city has more than 3,000 highly skilled and experienced dentists, or more than 50 per cent of the total number in the country.
With its potential, the city could attract more tourists who combine travel with dental care as well as promote the Vietnamese dental brand to compete with countries like Singapore and Thailand.
The fair also featured an exhibition on dental and travel services and dental technologies.
At the event, the HCM City Odonto-Stomatology Association unveiled a dental tourism club that will bring together Vietnamese and foreign experts in the field.-
Vietnam-Brazil trade up 16 percent
Two-way trade between Vietnam and Brazil hit about 1.73 billion USD in the last two quarters, representing a year-on-year increase of 16 percent, according to the Vietnam Commercial Affairs Office in Brazil.
The Latin American country’s export to Vietnam was estimated at 665 million USD, down 13 percent against the same period last year.
Meanwhile, Vietnam shipped goods worth 1.065 billion USD to Brazil, an increase of 46 percent.
The export of Vietnam’s staples to Brazil in the first five months of this year increased strongly again, especially synthetic fabric (over 300 percent), rubber and products from rubber (73 percent), telephones and electronic equipment (over 57 percent) and aquatic products (43 percent).
The Vietnam Commercial Affairs Office suggested Vietnamese exporters coordinate closely with Brazilian importers in handling complaints of relevant trade associations in Brazil, aiming to avoid lawsuits related to trade protection.
Experts said Brazil is one of the most important markets of Vietnam in Latin America. However, trade between the two nations declined in recent time due to the ongoing unstable politics in the Latin American nation.-
Garco 10 to export products to Japan through Uniqlo
The Garco 10 Corporation – SJC is seeking Japanese partners to bring products to the Japanese market in 2017 and the coming years, said the company’s Deputy General Director Than Duc Viet.
The company will sign an outsourcing contract with Uniqlo, thus supplying garment products for the Japanese brand for export to Japan, Viet said.
Uniqlo products are popular in Vietnam. The brand has 836 outlets in Japan, 416 others in China, 39 in the US and 27 across Europe. It has one new outlet established every week.
Besides, Garco 10 will also partner with Aeon Group to bring its products to the Japanese market.
Previously, Director General of AEON Vietnam Nishitoghe Yasuo said many Vietnamese exporters have shipped their products, such as tra fish, fruits, garments-textiles, foods and household utensils to Japan via its supermarkets.
In 2016, AEON imported about 200 million USD of made-in-Vietnam commodities, mainly apparel products and foods, he said, adding that the Japanese retailer plans to order more from Vietnam soon.
Garco 10’s export earnings to the Japanese market now account for 12 percent of its export turnover.
WB helps Vietnam in trade facilitation, logistics development
Deputy Prime Minister Vuong Dinh Hue had a working session with the World Bank (WB)’s Country Director in Vietnam Ousmane Dione, in Hanoi on June 26 to discuss trade facilitation, logistics development and on-stop-shop model.
Representatives from the Vietnamese Ministries of Finance, Planning and Investment, Industry and Trade, Transport and Foreign Affairs and the Government’s Office, and the WB experts group attended the session.
WB experts said that Vietnam has approved a national action plan on trade and logistics facilitation based on four pillars, including the simplification of customs procedures and professional management, the enhancement of trade infrastructure capacity and connection quality, the development of a competitive logistics sector, and the increase of coordination between Government agencies and businesses.
They suggested Vietnam exert comprehensive impacts on logistics value chains and create favourable conditions for foreign trade.
Although Vietnam has increased transport connection, the country’s multi-modal transportation has yet to catch up with national development, they said.
At the same time, the production of goods has outpaced the national gross domestic product (GDP) growth rate and infrastructure has failed to meet demands of goods transportation, they added.
Statistics from the Ministry of Industry and Trade show that during 2016-2020, it needs about 24 billion USD for transport infrastructure. However, the State can afford only one third of the amount.
Given this, the WB asked the Vietnamese Government to mobilise private capital and credit trade in order to raise the efficiency of transport infrastructure.
The WB experts also suggested the Vietnamese Government assign the National Committee on One-Stop-Shop Mechanism and Trade Facilitation to be in charge of logistics and call for the involvement of the private sector in the committee.
Ousmane Dione said that the WB experts group will give advice and technical support to Vietnam while sharing international experience in trade and logistics facilitation.
Deputy PM Hue said Vietnam is focusing on developing roads and railways along the North-South route without due attention to East-West and coastal routes.
He called on the WB to take this issue into account, calculating its impacts at national, regional and international levels.
The Vietnamese Government will call for the participation of the private sector in infrastructure development and professional inspection over exports and imports under the Public-Private Partnership (PPP) model and, he said.
The official urged the WB to help the Vietnamese Government with the framework, function, tasks and structure of the committee to facilitate trade, logistics and one-stop-shop model.
Binh Son company receives quality assurance system 2017 certificate
The Binh Son Refinery and Petrochemical Company Limited (BSR),which runs the Dung Quat oil refinery, has received the certifications of top 10 Quality Assurance System 2017 and the Quality Brands Outstanding 2017.
The certificates were awarded by the InterConformity Assessment and Certification and the Asia-Pacific Quality Network (APQN), which are announced by the Global Trade Alliance (Global GTA) annually.
Earlier, the Vietnam Enterprise Institute coordinated with the Global GTA, the InterConformity and the International Accreditation Forum, rated the BSR as the Golden Quality Provider 2017.
After seven years of operation, the BSR has produced and sold 47 million tonnes of products, meeting about 40 percent of domestic petroleum demand.
Its revenue hit 36 billion USD with profit reaching over 13 trillion VND at the end of the first quarter of this year. It contributed more than 7 billion USD to the State budget, more than two times higher than the investment of the Dung Quat oil refinery.
Bac Giang’s six-month export earnings hit 2.7 billion USD
The northern province of Bac Giang earned 2.7 billion USD from exports in the first half of 2017, up 33 percent from a year earlier, marking the highest growth rate compared to the same period of the last three years.
The provincial People’s Committee said the figure is equivalent to 56.3 percent of this year’s target, which was set at 4.8 billion USD.
Most of the export items were electronic products, apparel and agricultural products which were mainly shipped to the US, China, the Republic of Korea and the European Union.
Bac Giang eyes an annual export growth rate of 20-21 percent between 2016 and 2020. It expects to rake in 6.5 billion USD from exports by 2020 with industrial, agricultural, food and handicraft products being its key export staples.
To that end, Bac Giang will push ahead with administrative reform in the customs sector, thus facilitating export and import activities.
It will also promote the development of agricultural brands in order to boost the shipment of processed products such as canned agricultural products, lychees, Yen The hill chicken, Chu noodles, and rice wine of Van village.
The People’s Committee added that it will also step up communication activities, shifting the economic structure, developing markets, and fine-tuning financial, credit and investment policies for export-oriented manufacturing. Efforts will also be made to develop logistics infrastructure, human resources and local businesses’ competitiveness.
Kien Giang develops fisheries exploitation
The Mekong Delta province of Kien Giang is focusing on fisheries exploitation on the back of its favourable natural conditions.
Quang Trong Thao, Vice Director of the provincial Department of Agriculture and Rural Development, said Kien Giang currently offers fisheries logistics services and builds high-capacity fishing vessels for offshore fishing, particularly those with engines of more than 400 horsepower.
The province’s fisheries output rose from 311,000 tonnes in 2006 to 520,000 tonnes in 2016 and 268,000 tonnes in the first half this year, or half of the yearly target.
Vice Chairman of the provincial People’s Committee Mai Anh Nhin said before 1990, the province issued regulations on the management of fisheries resources exploitation and protection. In compliance with the Fisheries Law and the Vietnam Marine Strategy until 2020, the province has amended and supplemented such regulations many times.
At present, the province has embarked on a project to rearrange fisheries exploitation and production, a programme on fisheries protection and development until 2020, and built a major fisheries centre.
Kien Giang has approved the building and upgrade of 75 fishing vessels worth more than 671 billion VND (29.1 million USD), 21 of them have been put into operation.
Nhin said the province has partnered with Cambodia and Thailand to manage and tap fisheries resources, particularly migratory species with the support of the Swedish International Development Cooperation Agency and the Southeast Asian Fisheries Development Centre.
With the support of Japan, Kien Giang is developing high-tech fishing vessel fleets, fishing port, modern fishing markets and several infrastructure.
In order to fully develop marine-based economy, the locality plans to step up offshore fishing, fishing logistics services and infrastructure in combination with ensuring national defence-security.
Between now and 2020, further attention will be paid to increasing high-capacity fishing vessels and scaling down low-capacity ones used for inshore fishing.
At the same time, Kien Giang revised and supplemented planning for disaster-proof wharves until 2020 with orientations to 2030. As scheduled, 23 fishing ports and wharves will be put into operation in Chau Thanh, Phu Quoc, Kien Hai, Kien Luong, Hon Dat, An Minh, An Bien and Ha Tien township.
According to Nhin, the province will extend external work to attract more investment in the field, and suggest the State provide support for infrastructure construction on populated islands as well as search and rescue and patrol equipment.
Korea’s Hanwha, BCG Bang Duong ink deal to build solar power plant
BCG Bang Duong Joint Venture and South Korea’s Hanwha Group have signed an agreement to set up a US$100 million solar power plant in Long An Province.
The 125ha plant in Thanh Hoa District will have a capacity of 100MW.
Construction is expected to start in the first quarter of next year, and it will begin to generate electricity in 2019.
Under the agreement, BCG Bang Duong will arrange capital sources, obtain the licence for the project, implement the project and negotiate a power purchase contract with Electricity of Viet Nam, the country’s sole power distributor.
Hanwha will provide the technology and equipment, carry out the installation and arrange international funding for the project.
Nguyen Ho Nam, chairman of BCG – one of the two companies in the joint venture – said, “Understanding the importance and benefits of renewable energy amid rising electricity demand, BCG has chosen to enhance investment in renewable energy projects.
“With Hanwha Group’s experience and modern technologies in the renewable energy field, we believe that [the plant] will [help] mitigate climate change and protect the environment.”
The agreement was signed in Long An on June 22 in the presence of provincial leaders and officials.
Hanwha, founded in 1952, is the eighth largest Korean corporation and has interests in petrochemicals, aerospace, construction, finance, renewable energy, and others.
BCG Bang Duong Joint Venture, a joint venture between Bamboo Capital JSC (BCG) and Bang Dương Investment - Construction - Trading Company, specialises in infrastructure development, real estate and renewable energy.
ABAC prioritises regional integration, sustainable growth
Strengthening regional integration, promoting sustainable, innovative and inclusive growth, and enhancing the competitive edge of micro-, small- and medium-sized enterprises (MSMEs) are among the Asia-Pacific Economic Cooperation’s (APEC) 2017 priorities.
Business Advisory Council (ABAC) chairman Hoang Van Dung unveiled this information at a press conference held in Ha Noi on June 21 by the Vietnam Chamber of Commerce and Industry (VCCI) to provide information on activities being held towards the APEC High-Level Week 2017.
Dung said ABAC’s work plan in 2017 will also focus on encouraging innovations in the digital era, ensuring food security and promoting sustainable and smart agriculture adaptive to climate change.
Regarding the second ABAC meeting in Seoul, Republic of Korea, he said APEC members agreed to focus their recommendations on the benefits of trade liberalisation and development as well as reduction of non-tariff barriers to goods.
The council emphasised the importance of the World Trade Organisation and values of free trade agreements such as the Free Trade Area of the Asia-Pacific, Dung said.
ABAC also noted that a stronger global supply chain will create opportunities to realise the huge potential of the digital economy and lenient policies will enable MSMEs to get easier access to international markets and global value chains and strengthen the participation of women in the economy.
The VCCI will also host ABAC’s third meeting in Canada and the fourth meeting in Viet Nam’s Da Nang City to discuss and give business recommendations. ABAC’s report will be submitted to APEC leaders at the APEC High-level Week to be held in Da Nang in November.
ABAC is the private sector arm of the APEC. APEC economic leaders decided to establish ABAC in November 1995 to advise them and other APEC officials on issues of interest to business. ABAC also responds to requests from various APEC sub-groups for information about the business perspective of specific areas of cooperation.
This private sector body presents recommendations to APEC leaders at an annual dialogue and advises APEC officials on business sector priorities and concerns.
ABAC comprises up to three senior business people from each APEC economy. Appointments are made by the leader of the member economy concerned. The chair of ABAC comes from the economy that is hosting APEC and therefore changes annually. ABAC represents a diverse range of sectors and includes small and large enterprises.
Level the field to foster private sector: forum
The nation’s private sector needs less intrusive management rather than short-term policy support, some economists said at a forum on Thursday.
They also argued that a genuinely level playing field is the only way that the Vietnamese private sector, mostly comprising small and medium-sized enterprises, can pull its real economic weight.
At the 2017 Viet Nam Business Development Forum (VBDF) held in Ha Noi, they said the private sector was becoming more crucial for attaining national economic growth targets, but it could only progress further with right incentives and support from the Government.
Ho Sy Hung, deputy head of the Department of Enterprise Development under the Ministry of Planning and Investment (MPI), said that the private sector in Viet Nam consists mostly of micro, small and medium-sized enterprises.
These firms account for 97.7 per cent of the total labour and 94.8 per cent of total capital in the private sector, he said.
As such, the majority of private companies fail to generate enough return on sales (ROS), since they lack the capital to upgrade facilities and improve productivity.
As of 2016, the ROS for these small businesses was around 1.72 per cent, compared to the public sector’s 6.04 per cent and the foreign direct investment (FDI) sector’s 6.95 per cent.
Hung urged policy makers to take these low numbers into consideration and issue suitable policies for the private sector, instead of just accommodating the State and FDI sectors.
He said he firmly believed in the potential of the private sector, which contributed 43.22 per cent of the GDP in 2016, while the State sector accounted for 28.69 per cent.
In the first five months of 2017, more than 50,000 new private businesses have been established and an additional VND1.2 billion (US$53,492) has been put into circulation, said.
Vu Dinh Anh, deputy director of the Price and Market Research Institute under the Ministry of Finance, agreed with Hung, saying that the private sector must be given the same treatment as the State and foreign-owned sector if it is to drive Viet Nam’s economic progress.
However, he said, small and very small enterprises are also undermining themselves by not taking the initiative to follow relevant regulations even as they demanded preferential treatment.
Anh noted that policy makers cannot give further priority to these firms in terms of rentals and loan rates.
He said the current interest rates for small and very small businesses of 7 to 9 per cent per annum were already normal, and the only help the Government can provide is to make loans more accessible.
Regardless, the current set of Vietnamese business regulations sometimes prevent small enterprises from growing, said Dau Anh Tuan, director general of the Legal Department of the Viet Nam Chamber of Commerce and Industry (VCCI).
He also said that he’d observed a trend in which the larger a business is, the more likely it is subjected to several inspections by different agencies.
Such approaches do not provide businesses incentives to grow, he said, adding a study found 14 per cent of businesses reporting “duplicated” inspections in 2016, while 65 per cent said they’d had trouble dealing with administrative procedures.
Hung from the MPI recommended that the Government lifts the burden on the private sector by helping reduce production costs in terms of logistics, insurance and transportation, and by simplifying administrative procedures.
The forum was jointly organised by the MPI and the Economy and Forecast Review Journal.
More than 300 representatives of various ministries and economic sectors attended the forum.
Fivimart hosts "In-store Promotion for Thai Products 2017"
Ten branches of the Fivimart supermarket chain have displayed Thai commodities as part of the “In-store Promotion for Thai Products 2017 in Ha Noi” programme lasting from June 22 to 25.
The event has been co-organised by the Department of International Trade Promotion under the Ministry of Commerce of Thailand and the Thai Embassy at Ha Noi’s Office of Commercial Affairs in cooperation with Viet Nam National Trade Fair and Advertising Company VINEXAD and Fivi Mart, owned by Nhat Nam JSC.
Along with exhibiting and trading activities through a series of fairs, exhibitions and B2B events, which have been organised to promote Thai products in the Viet Nam market for years, this event, held for the third time in Ha Noi, aims to enhance trade relations between Viet Nam and Thailand, Thai Ambassador to Viet Nam Manopchai Vongphakdi said during the opening ceremony of the event held on June 22.
“Besides promoting Thai products, we also have a Thai dancing show, Thai cooking and fruit carving demonstration to promote Thailand’s traditional culture to Vietnamese customers,” Vongphakdi said.
According to Vu Thi Hau, deputy general director of the Nhat Nam JSC, Thai commodities, comprising of food products, household appliances and fruit, have been showcased at the Fivimart supermarket chain’s 10 branches -- Fivimart Chuong Duong Do, Fivimart Dai La, Fivimart Hoang Quec Viet and Fivimart Truong Dinh, as well as Fivimart My Dinh, Fivimart Nhat Tan, Fivimart Ly Thai To and Fivimart Vo Thi Sau, along with Fivimart Truc Khe and Fivimart Xuan Dieu.
“It is expected that in the next four days, Fivimart will attract more than 10,000 visitors, and sales of Thai products at these 10 Fivimart supermarkets during these days are estimated to increase 300 per cent over 2016,” Hau said.
Doosan and partners agree on Vietnamese market accessing
South Korea’s Doosan Heavy Industries & Construction Company signed a Memorandum of Understanding (MoU) with five partners at its Vietnamese operation Doosan Heavy Industries Viet Nam Company (Doosan Vina) to help them enter the Vietnamese market, the company said.
As per the June 18 agreement, Doosan will provide consulting on administration, financial management and business management to support the partners to establish their subsidiaries or manufacturing facilities at the site of Doosan Vina plant.
It will also enter into negotiations with local authorities to help the partners receive benefits like tax cuts.
The power generation market in the Southeast Asian country has a strong growth potential, as the country is expected to add new facilities generating 100 gigawatts of energy by 2030.
Doosan Vina, situated in the Dung Quat Economic Zone in Binh Son District of the central province, is a high-tech industrial complex with nearly 2,500 employees, supplying mega infrastructure products for thermal power plants, desalination plants, cranes and chemical processing equipment for export.
The company exported $300 million worth of goods in 2015.
Quang Ninh’s GRDP growth sets five-year record
Quang Ninh Province’s gross regional domestic product (GRDP) expanded by 9.6 per cent in the first half of this year against 9.2 per cent in the same period last year.
In the first quarter, the province’s GRDP grew 8.3 per cent while the figure recorded in the second quarter was 10.7 per cent, the fastest pace since 2012.
With this performance, Quang Ninh has been listed among the leading cities and provinces in the northern key economic region and nationwide.
Sectors posting the highest growth rate include services at11.5 per cent, industry and construction at10 per cent, and agriculture-forestry-fishery at 2.2 per cent.
To reach the target of 10 per cent growth rate, the province will focus on drastically instructing the implementation of socio-economic development tasks and solutions set for 2017.
The locality will remove difficulties facing businesses, support startups, facilitate production and business, and spur growth. At the same time, it will accelerate administrative reform and intensify investment, tourism and trade promotion to attract more resources for local socio-economic development.
Located on the northern coast with advantages in location and natural resources, Quang Ninh is striving to tap its full potential in maritime economic development.
As part of efforts to implement Resolution 09-NQ/TW on Viet Nam’s Sea and Island Strategy until 2020, Quang Ninh has applied measures to boost its sea-based economy in line with ensuring national security and defence.
In recent years, the province has focused on building infrastructure to boost maritime economic development, especially tourism and aquaculture.
Currently, all seaports in Quang Ninh have been upgraded to strengthen their capacity in providing services and connecting the mainland and islands in the region.
Some seaports in the locality are being expanded to national and regional scales, including Hai Ha, Cai Lan and Cua Ong.
Quang Ninh has also mobilised resources for the comprehensive development of infrastructure in coastal economic zones and industrial parks (IPs), including the Van Don EZ and Hai Ha, Dam Nha Mac, Viet Hung and Hai Yen IPs, attracting more investment.
Investment promotion activities have been used to call for investment in major projects, including Van Don airport, Van Tien bridge, major seaports and roads, as well as other projects in entertainment, resorts, aquaculture and fishing.
In 2016, Quang Ninh welcomed 8.3 million tourists, a year-on-year increase of 7 per cent, earning over VND13 trillion (US$571 million) in revenue, up 23 per cent, according to the provincial Department of Tourism.
By 2020, the province aims to serve 15-16 million tourists, including seven million foreigners, and rake in VND30-40 trillion ($1.3-1.7 billion) in revenue. The tourism sector is expected to contribute 14-15 per cent to the GRDP.
New department launched to accelerate agricultural export
The Ministry of Agriculture and Rural Development (MARD) on Wednesday launched Agro Processing and Market Development Authority (AgroTrade).
The new department will advise the minister on the implementation of laws on developing markets of agro-forestry and seafood products and salt; it will coordinate activities to expand markets; and organise the management, processing and preservation of agro-forestry and seafood products and salt, as per the minister’s instructions.
Speaking at the launch ceremony in Ha Noi on Wednesday, Minister Nguyen Xuan Cuong said agriculture played an important role in the country’s economy and the society’s sustainability. After 30 years of doi moi (renewal) period, Viet Nam had evolved from being a rice deficit nation to one that meets local demand as well as has enough for export.
In 2016, the country earned US$32 billion from export. Of this, 10 types of goods crossed more than $1 billion in value each.
Cuong said the country now faced three challenges. Firstly, with 10 million farmer households, agricultural production is less, as is the labour, which is lower than that in the region and the world.
Secondly, Viet Nam is among the top five countries in the world most affected by climate change, especially in agriculture. And finally, integration is weak.
The minister said the sector needed to be restructured and efforts must be focused on concentration and sustainability using technology and a deep value chain that is adaptable to climate change. “At the present, processing and marketing are weak, and the processing value chain is not closed because production is still separate from the market. This leads to having to take measures to rescue agricultural products from plummeting prices,” Cuong said.
The world market is fluctuating unpredictably, especially when it comes to agricultural products, the minister said. At such a time, the AgroTrade would play a critical role by closely co-ordinating with ministries, sectors, localities, associations and businesses to better organise production and market in order to optimally exploit the global market, which has a population of seven billions, and the domestic market, which has around 92 million people.
Maritime Bank provides auto cashback for Clingme users
Maritime Bank on Thursday signed an agreement with Gingatum Viet Nam to provide auto cachback services for users of the startup’s shopping app Clingme.
Accordingly, Clingme users with accounts at Maritime Bank will receive money immediately in their bank accounts when they want to withdraw money from Clingme accounts.
Normally, it takes five days to withdraw cash from Clingme accounts.
Clingme is an app via which users will get cashback of up to 40 per cent on their shopping bills from the company’s partner stores. At present, Clingme has partnered with 2,700 stores in Ha Noi and HCM City.
Founded in 2013, Gigatum has raised funding of US$3 million. The company plans to have one million users at Clingme and 10,000 partner stores by the end of this year.
Isuzu launches SPV models
Isuzu Vietnam on June 23 launched its Special Purpose Vehicle (SPV) line-up, marking an important step for the brand in Viet Nam’s market.
With the basic structure of an Isuzu truck, special rear bodies can be installed on the SPV, depending on customer demand.
At the launch, typical SPV models were showcased, including a refrigerated truck, fork-lift truck, garbage truck, dumper truck, breakdown truck, 10-door van truck, full-wing van truck and crane truck.
“We studied and collaborated with our inbound and outbound partners who specialise in van manufacturing to create the high-end SPV under the brand of Isuzu,” said Hidekazu Noto, general director of Isuzu Vietnam. “We continue to improve both after-sale services and accessories.”
Isuzu Vietnam will focus on developing a short chassis line-up to serve the diverse demands of the SPV segment.
In Viet Nam, Isuzu has focused on developing and diversifying its products, including light-duty, medium-duty and heavy-duty trucks and durable and fuel-efficient tractor heads, as well as pick-up trucks and seven-seater SUVs.
EVN exports 0.7 billion kWh of electricity in H1
The Electricity of Vietnam (EVN) exported about 0.7 billion kWh of electricity in the first half of 2017.
In January-June, the company generated and purchased 95.7 billion kWh of electricity, a yearly increase of 7.9 percent, ensuring supply for domestic needs.
Commercial electricity reached 84.1 billion kWh, a year-on-year rise of 10.05 percent.
The EVN accounts for 61.5 percent of the total national power generation capacity of 43,010 MW.
In 2017, the company aims to generate and purchase 196.8 billion kWh of electricity, up 11.1 percent year-on-year, and sold 177.8 billion kWh of power, up 11.3 percent against the previous year.
To realise this goal, the group will make full use of electricity plants, especially the Vinh Tan 2 and Duyen Hai 1, 3 thermal power plants, as well as gas and coal-fired plants to provide sufficient electricity for the dry season of 2018.
It plans to reduce the import of electricity from China while increasing the power-generating capacity at domestic plants.
The EVN will consider increasing the sale of electricity to Cambodia and ensure safe operation of power transmission grid, particularly the 500kV North-South system.
It strives to reduce electricity losses by 7.47 percent in 2017, and take saving measures so that the total production cost will be slashed by over 2.9 trillion VND (127 million USD) against the yearly target.