BUSINESS IN BRIEF 27/2

Sugar makers hope to cut stockpiles

Viet Nam will have a sugar surplus of several hundred tonnes this year, and the industry is looking to increase exports and reduce inventory.

The Ministry of Agriculture and Rural Development (MARD) estimates domestic demand for sugar at about 1.4 million tonnes this year.

Sugar output is forecast to reach 1.5 million tonnes in the 2012-13 crop. With 178,000 tonnes in stock since the previous year and 70,000 tonnes imported under Viet Nam’s World Trade Organisation commitments, the country will have a surplus of nearly 350,000 tonnes this year.

However, industry insiders say the real surplus is likely to be much higher because the quantity of sugar illegally imported is very high every year.

To face the challenge of rising inventory, MARD and the Viet Nam Sugarcane and Sugar Association have proposed that the Ministry of Industry and Trade (MoIT) allows exports of 300,000 tonnes of sugar this year.

A representative of MoIT agrees with the proposal, but wants it to be done in phases, with the first phase exporting 100,000 tonnes, said Nguyen Hai, the association’s general secretary.

But another representative from the ministry opposed allowing the export via unofficial cross-border trade with China at this time, saying that the industry must wait until the end of the crop – between July and August, assess the domestic supply and demand situation before considering exports.

The association said enterprises will lose export opportunities if they wait until the end of the crop.

Selling through unofficial cross-border trade will help reduce inventories at sugar mills, it said.

Currently, many sugar mills lacked capital for production because of high inventories and low domestic demand.

Sugar prices dropped by VND200-VND300 a kilo compared to weeks for Tet, pushing down sugarcane prices in the north and central regions.

Despite facing many difficulties, sugar mills in the Cuu Long (Mekong) River Delta have not lowered purchase prices for sugarcane from farmers for concern that if the latter incur losses, they would stop planting sugarcane. In this case, the mills would not have material for production the next year.

Co Tri Dung, general director of the Soc Trang Sugarcane and Sugar Joint Stock Company, said if MoIT does not allow sugar export via unofficial cross-border trade, mills in the Mekong Delta will surely reduce sugarcane prices and farmers will suffer losses.

Sugar mills in the delta will organise a meeting at the end of this month to discuss sugarcane purchase prices. 

Ha Noi posts 3.3% boost in import turnover

Ha Noi’s import turnover in the first two months of the year reached over US$3.3 billion, an increase of 3.3 per cent against the same period last year.

In February, the capital city imported more than $1.6 billion worth of goods, down 2.9 per cent month-on-month and 8.7 per cent year-on-year.

Most import commodities saw decreases during the month, except for fertiliser and plastics, due to decreased production during Tet. The city’s imports are forecast to rise again in the coming months. 

Sweet potato export prices see large spike

After the Lunar New Year, the export price of purple sweet potatoes sharply increased to the highest level seen in recent years.

Prices currently range between VND1.2-1.3 million (US$57-62) per 100kg, said Huynh Van Quan, deputy head of Tan Thanh cooperative in the Mekong Delta province of Vinh Long. He attributed the surge in price to Chinese traders’ large volume purchases, combined with the Mekong Delta’s failure to provide enough potatoes to meet the increasing demand because the harvest had already concluded.

White sweet potatoes are now sold at VND370,000 ($18) per 100kg, ensuring profits for farmers.

Japanese banks finance highway project in Viet Nam

A credit agreement for the Ha Noi-Hai Phong Highway project was signed last Friday in Tokyo between the Viet Nam Development Bank (VDB) and Sumitomo Mitsui Bank Corporation (SMBC) and Japan’s Citibank.

Under the agreement, SMBC and Citibank will provide VDB with loans of US$270 million to fund two parts of the project. They must be repaid within 15 years, with a grace period of 4.5 years.

According to VDB, the highway will be the first intercity traffic route in Viet Nam to meet international standards.-

VietJetAir offers massive promotion for all routes

VietJetAir announced a huge promotion yesterday where tickets will cost only VND10,000 (50 US cents).

Up to 10,000 super cheap tickets on the low-cost carrier’s 10 routes will be available at www.vietjetair.com between 9pm and 11.59pm from March 5 to March 18. This promotional price is valid for flights from April 1 to May 10 and from September 5 until December 31.

VietJetAir’s domestic network now covers HCM City, Ha Noi, Hai Phong, Vinh, Da Nang, Hue, Nha Trang, Da Lat and Phu Quoc. The airline’s first international route from HCM City to Bangkok was launched on February 10.-

SCIC establishes separate investment arm

The State Capital Investment Corporation (SCIC) has established a new subsidiary in a move to limit the State’s exposure to investment risks.

The new company, SCIC Investment Co Ltd, is capitalised at VND1 trillion (US$47.6 million) and will take advantage of SCIC’s capital resources to invest in shares, bonds, acquisitions and investment projects.

Measures urged to track performance

The National Council for Sustainable Development and Competitive Improvement had to come up with a set of criteria to measure the country’s capacity for competitiveness and sustainable development.

The instruction was delivered by Deputy Prime Minister Nguyen Thien Nhan at a meeting with the council last Friday.

Nhan emphasised the need to conduct a more thorough analysis on the country’s current competitive capacity and determine what policies or regulations should be taken to bolster the country’s sustainable development.

Although Viet Nam made several major economic achievements last year, many of the country’s macro- and micro-economic policies prevented it from becoming more competitive in many fields, participants asserted.

Vietnamese people’s average income was quite low in comparison with their peers’ average rate in other Asian developing countries, and the country was also coping with rapid and unstable growth, high inflation and fewer investments.

Moreover, Vietnamese enterprises lacked clear strategies and innovations, they argued, while the education and training sector had yet to catch up with economic growth and outdated administrative systems still burdened development in many fields.

Former Minister of Commerce Truong Dinh Tuyen said that the new criteria should be based on the country’s current development level and economic conditions as well as consultations with foreign partners.

The National Council for Sustainable Development and Competitive Improvement, established last July, aimed to respond to Viet Nam’s falling position in the global competitive index.

The World Economic Forum’s annual report assesses the competitiveness of economies worldwide.

Last year, Viet Nam was ranked 75th out of 144 economies, 10 places lower than the previous year. 

EU exports rise 22% in 2012

Two-way trade turnover between Viet Nam and the European Union (EU) in 2012 reached US$29.09 billion, up 19.77 per cent from 2011, according to the General Department of Customs.

Viet Nam exported $20.31 billion worth of goods to the EU in 2012, an increase of 22.71 per cent on year, while importing $8.79 billion worth of goods and services, up 13.48 per cent. This year, the EU surpassed the US to become Viet Nam’s largest importer.

Viet Nam’s key export items to the EU were garments, footwear, coffee, seafood, computers, mobile handsets and spare parts. These accounted for 75 per cent of the country’s total exports in 2012.

While the country only began to export mobile handsets and spare parts to the EU in 2011, the export value for these products topped $5.4 billion last year.

Other commodities saw moderate growth, such as plastic products, wood and wooden products, bags, suitcases, umbrellas, pepper and cashew nuts.

For its part, Viet Nam imported mainly machinery and equipment, pharmaceuticals, milk and dairy products from the EU.

According to the European Market Department of the Ministry of Industry and Trade, the fact that bilateral trade between Viet Nam and the EU continued growing despite the world economic stagnation and the number of EU member states facing debt crisis was a positive signal, suggesting that the cooperation between the two sides was steadily increasing. 

US still largest importer of Vietnamese seafood

Despite trade barriers, the US remained the largest importer of Vietnamese seafood last month, with total export turnover of US$376 million, up 3.5 per cent over the same period last year.

This was according to Seafood Department of the Ministry of Agriculture and Rural Development.

The country’s seafood export turnover to the US in January accounted for 19.15 per cent, followed by Japan with 17.81 per cent and South Korea with 8.36 per cent. Although local experts forecast the seafood industry would face a number of challenges this year, including a lack of capital for production, shortage of raw materials and workers, Viet Nam still expects to increase seafood export turnover to $6.4 billion this year from $6.15 billion last year.

To achieve the goal, the ministry has asked the seafood industry to focus on its main exports such as shrimp, tra fish and tuna, by expanding seafood breeding farms, promoting trade promotion and improving market forecasts for the industry.

Last year, the US overtook the EU as the largest importer of Viet Nam’s seafood with total export turnover of $1.19 billion, making up 19.4 per cent of total seafood exports and increasing by 1.2 per cent over 2011, according the Viet Nam Association of Seafood Exporters and Producers.

Public housing needs official boost

Priority should be given to perfecting institutions related to real estate development, said Deputy Prime Minister Hoang Trung Hai, who is also head of the Central Steering Committee on Housing Policy and the Real Estate Market, at the committee’s first meeting of the year in Ha Noi on Friday.

Hai urged the committee to demand more interdisciplinary inspections nationwide to focus on difficulties in financing progress, mortgage lending rates, and planning residential areas that are resilient to climate change.

He especially pointed to the need to enforce the requirement that 20 per cent of land allocated for housing projects be reserved for low-income housing.

Minister of Construction Trinh Dinh Dung said that difficulties in the real estate market needed to be resolved in line with the National Housing Development Strategy for 2013, and, in light of the nation’s 32-per-cent urbanisation rate, he predicted a growing shortage for affordable housing in the next few years. He urged the Government to direct local authorities to pay greater attention to developing such housing.

Dung stressed that preferential credit for home buyers at low interest rates of 5-6 per cent per year would do the most to ensure sources of financing for real estate developers to build affordable housing. 

Fishing boats, docks cited by hygiene inspectors

The regulatory scheme and performance of Vietnamese agencies in charge of ensuring the quality and safety of seafood at all administrative levels nationwide are in compliance with European Commission standards, according to the findings of a group of EU inspectors who visited the Vietnamese agencies last year.

The National Agro-Forestry-Fisheries Quality Assurance Department (NAFIQAD) admitted, however, that the European inspectors found shortcomings related to hygienic conditions at pre-processing facilities, including fishing boats, ports and fisheries.

NAFIQAD has asked provincial departments of agriculture and rural development to continue working to boost awareness of food safety regulations among the owners of fishing fleets, the managers of fishing ports, the operators of fish-breeding facilties, and purchasing agents.

Agricultural quality assurance branches have also been ordered to intensify their inspections of hygienic conditions at these pre-processing facilities.

Businesses that process seafood for export have also been asked to use materials verified by municipal and provincial agricultral quality assurance branches.

Developers revise strategies to survive

The continued slump in the property market has forced real estate companies to change their mode of investments in order to survive.

Hoang Anh - Gia Lai Property JSC, for example, has taken the lead by moving machinery and equipment to Myanmar for construction of a hotel-office building complex.

Le Hung, chairman of the company’s management board, said they would continue construction of property projects in HCM City that have been partly sold. Other projects would be suspended as the company focuses its efforts on projects in Myanmar.

Pointing to a trend in the property market, the Thu Duc House Development JSC said it was ready to launch its first low-cost apartment project.

Nguyen Vu Bao Hoang, deputy general director of the company, said the local property market this year would focus on low-cost housing priced under VND15 million per square metre, targeting low-income customers.

Hoang said the company had cleared the ground and had received the design and construction licence as well as building materials for the 40- 60 sq.m apartments in Thu Duc District.

“We are looking for a ‘warmer’ market and a more reasonable interest rate to break ground for the project,” said Hoang.

On the rental side, Dat Lanh Property Co has 22 apartments for rent at Thai An Building in District 12.

Renters who pay VND200 million (US$9,570) to the investor of the project would be allowed to live in a 22-sq.m apartment for six months to two years without paying monthly rent. After two years, the investor would return the initial sum of money to the renter.

Nguyen Van Duc, deputy director of Dat Lanh Property, said many companies were trying to survive in difficult times and that changes in their business strategies would help sell off stockpiled goods.

According to figures from the Construction Ministry, 2,600 of 56,000 enterprises specialising in property and construction last year suspended operations in the country.

Insiders do not expect the local property market to be much better in 2013. However, new waves of house price reductions have been seen in the local market.

Cambodia, Laos rubber

The area under Viet Nam Rubber Group’s cultivation in Laos and Cambodia totals 100,000 ha, including 27,000 ha under the group’s seven rubber projects in Laos.

The company said that after successful projects in southern and central Laos, VRG established its subsidiary Dien Bien - Northern Laos Co to invest in a rubber project in the northern province of Oudomxay in Laos.

Also in Laos, Viet - Laos Rubber JSC has commenced exploiting latex on nearly 5,500 ha under rubber cultivation, and their products have been sold to local and overseas markets.

By the end of 2012, VRG had 21 rubber projects in Cambodia, including 19 rubber tree plantations and two rubber-processing projects.

To date, VRG has over 70,000ha under rubber cultivation in Cambodia, including several areas cultivated by its subsidiary Tan Bien - Kampongthom which are currently producing latex.

The company said in 2013 it would plant rubber trees on an additional 25,000 ha in Cambodia.

Together with other Vietnamese companies, VRG intends to realise a plan to have 100,000 ha under rubber cultivation in Cambodia by 2014, one year ahead of schedule of an agreement previously approved by the governments of Cambodia and Viet Nam.

Rice export earnings off

Viet Nam exported more than 7.7 mil lion tonnes of rice, earning more than US$3.5 billion in 2012. Last year, Viet Nam also surpassed Thailand in rice exports and was ranked the world’s second-largest rice exporter, behind India.

However, many local farmers were unhappy because last year’s volume of rice exports increased by 8.3 per cent compared with 2011, while rice-export turnover dropped by nearly 2 per cent.

Speaking at a meeting to review rice production in 2012, held in the Mekong province of An Giang in early February, the Deputy Minister of Agriculture and Rural Development, Bui Ba Bong, said that last year’s rice output amounted to 44 million tonnes, 1.6 million tonnes higher than the previous year.

The volume of exported rice in 2012 was 630,000 tonnes higher than 2011, Bong said.

However, the export price for Vietnamese rice was $447 per tonne on average, $40 per tonne lower than the price in 2011.

At that time last year, paddy prices were not as high as expected, while local farmers had to pay more for production costs.

The average monthly income of rice growers in the Mekong Delta, which supplies up to 90 per cent of Viet Nam’s rice for exports, was about VND300,000 ($14.3) per person, Viet Nam News Agency said, citing figures from the World Bank.

Local farmers remain unhappy as prices of paddy from the current winter - spring crop are not as high as expected.

The Ministry of Industry and Trade has said that in January Vietnamese exporters won contracts to export 1.3 million tonnes of rice this year, not including contracts of 650,000 tonnes signed last year.

According to the UN’s Food and Agriculture Organisation, many countries this year would need to import about 37.5 million tonnes of rice.

To reduce the stockpiles of rice and prepare for new crops, rice-producing countries will increase rice exports, forcing rice prices down by about $20 per tonne.

Therefore, Vietnamese exporters will encounter harsh price competition from Thailand and India. 

Bank swings to profit after adjusting earnings data

Sai Gon-Ha Noi Bank (SHB) announced revised earnings for 2012 yesterday that were shift from a loss of VND95 billion (US$4.5 million) to a net profit of VND27 billion ($1.28 million).

Most of the data issued Friday remained the same as previously published. However, the net profit from other operations in the fourth quarter was increased from VND630 billion ($30 million) to VND752 billion ($35.8 million). The previous figures were announced only on Tuesday. The sudden change in data without any accompanying explanation has raised a red flag among investors as to the transparency of the bank.

Trade groups found lacking

Hampered by a lack of resources, Viet Nam’s business associations are struggling to attract new members and come up with long-term plans for growth.

Currently, the country has almost 400 business associations, including 28 at the national level and 50 at the provincial level, said Viet Nam Chamber of Commerce and Industry (VCCI) chairman Vu Tien Loc.

During the country’s shift from a centralised to a market economy, these associations helped protect the rights of enterprises and act as links between the business community and Governmental agencies.

However, he said, their capacity was still limited, in large part because there was no legal framework governing their actions.

At present, the associations attracted less than ten per cent of enterprises in particular industries or localities. Ten associations reported that membership had been steadily decreasing.

One reason is the associations’ lack of long-term strategies for growth. Among 78 associations that participated in a survey conducted by the (VCCI), only 23 had development strategies. Two others are currently creating strategies, while the rest lack any kind of cohesive plan for the future.

Worsening, only 11 percent of the strategies were publicised and a mere 16 percent were sent to the associations’ partners and relevant agencies.

Even though the survey indicated that having a clear development strategy would pave the way to growth, Vietnamese enterprises often fail to see the value in making such plans.

Moreover, many associations - particularly in the export-import sector - have not fulfilled their duties in protecting the rights of members, said Dr Pham Van Chat, arbitrator at the Viet Nam International Arbitration Center.

When a Singaporean company sued a Vietnamese rice exporter for US$1.4 million in 2010, Chat tried to contact the chairman of the Viet Nam Food Association seven times but received no reply.

And associations rarely considered the needs of members or the market in deciding what services should they provide, the survey found.

Only 17 per cent of surveyed associations conducted studies on market demand and customer needs when planning activities, barely 24 per cent consulted member enterprises - and a scant 28 per cent considered their services useful for members.

Dau Anh Tuan, deputy head of the VCCI Legal Department, said that in many anti-dumping and anti-subsidy cases, most business associations were not capable of assisting their members – even though “the role of associations has become increasingly important” in such cases.

Only a few associations with experience in anti-dumping lawsuits, like the Viet Nam Association of Seafood Exporters and Vietnam and the Viet Nam Leather and Footwear Association, were able to help their members, he said.

Local associations were stuck in a vicious cycle, according to Tuan, as a lack of money and materials made it hard for associations to attract skilled personnel.

Without skilled personnel, associations are not able to offer professional services that would attract new members. Failure to draw new members resulted in further capital shortages – thus limiting opportunities for growth. 

Shrimp processor sees drop in profits

Seafood processor Minh Phu (MPC) last year got a profit of VND91 billion ($4.3 million), or a decrease of 67 per cent from the previous year and only 12.7 per cent of the year’s target. Although net sales in the fourth quarter decreased only slightly, increasing costs caused the quarter’s gross profit to decline 23.6 per cent compared to the corresponding period in 2011. 

Mekong conference to discuss strategy for winter-spring rice crop

The Mekong Delta province of Dong Thap will host a conference on the purchase of paddy/rice from the current winter-spring crop for reserves.

The conference, held at the office of Dong Thap People’s Committee on next Wednesday, will also discuss rice export prices.

The conference, which is to be chaired by Deputy PM Hoang Trung Hai, will focus on the co-operation and collaboration between farmers and exporters under the large-scale cultivation model; as well as the production and consumption of shrimp and tra fish in the country.

The Viet Nam Food Association (VFA) is scheduled to deliver a report on purchases of winter-spring paddy/rice and plans for this year’s rice export.

The An Giang Plant Protection Service (AGPPS) Joint Stock Co will report on achievements attained with the large-scale rice production model.

Businesses under the VFA have begun to purchase one million tonnes of rice of the current winter-spring crop 2012-13 for reserves under a decision by PM Nguyen Tan Dung.

The purchase campaign for reserve will last until 31 March 2013.

The VFA said it has appointed 120 buyers to take part in the rice purchase plan and commercial banks are ready to provide loans for VFA members to join the campaign.

According to the Deputy Chairman of southern Hau Giang Province People’s Committee, on last Friday one kilo of fresh IR 50404 paddy was sold for VND4,200 at the field right after harvest.

Although paddy prices were up two days after the launch of the reserve-purchase campaign, they are not sufficient to ensure reasonble earnings for farmers, he added.

Central province eyes industrial expansion

The central province of Thua Thien – Hue aims to attract investments of VND2.9 trillion (US$138 million) to its industrial zones (IZs) this year.

Nguyen Huu Tran, head of the provincial IZ management board, said 2013 will also be a year to develop infrastructure and make the IZs more attractive to investors.

Tran said that the board would co-operate with provincial districts and communes to accelerate land clearance so investors can get encumbrance-free land for their operations.

The board would also support investors in plant construction and mobilise capital to upgrade infrastructure around local industrial zones, he said.

Tran affirmed that local administrative procedures would be further streamlined this year, creating advantageous conditions for investors in the province.

The province would also invest in human resources training to meet the demand of investors in industrial zones, he said.

Seven infrastructure development projects covering a total area of more than 717ha are being carried out now at local industrial zones.

Infrastructure construction at the Phu Bai and Phong Dien IZs is almost complete.

Meanwhile, investors are completing procedures for upgrading infrastructure of IZs in La Son, Phua Da, Tu Ha and Quang Vinh.

As of the end of last year, the province had attracted 78 projects to local IZs with a total capital of nearly VND16 trillion. About 40 projects have been put into operation.

Last year, the province granted investment certificates to nine projects and permitted four others to increase their capital.

The industrial value of IZs last year topped VND3.2 trillion ($152 million). The export turnover from the IZs was nearly $295 million, accounting for 64 per cent of the province’s exports.

In 2012, IZs in the province employed about 14,000 people. 

VN-Brazil trade turnover maintains growth

Two-way trade turnover between Viet Nam and Brazil in 2012 reached nearly US$1.64 billion, an increase of 13.8 per cent from 2011, according to Brazil’s Ministry of Development, Industry and Foreign Trade.

In 2012, Viet Nam earned $817.2 million from exports to Brazil, up 26.3 per cent from 2011, and imported 822.6 million worth of commodities from the country, a year-on-year increase of 3.6 per cent.

Viet Nam exported footwear, fish fillets, printers, chip sets and rubber to Latin America ’s largest economy while importing soybean products, cotton, tobacco, corn and timber.

The trade recorded the positive development despite 5.26 per cent and 1.37 per cent decreases in Brazil’s 2012 total export and import values ($242.58 billion and $223.15 billion), respectively, due to the global economic downturn.

It has seen constant growth since 2000, in particular the first-ever turnover of more than $1 billion in 2011, the Brazilian ministry’s statistics showed.

Vietnamese restaurant prepares to wow Parisian punters

Foyer Viet Nam, a restaurant featuring Vietnamese traditional cuisine, made its debut in Paris’ District 5 on Wednesday.

Dinh Toan Thang, Minister of the Vietnamese Embassy in France, attended the opening ceremony along with representatives from local authorities.

Addressing the event, Foyer Viet Nam President Nguyen Binh said he hoped to create a space for Vietnamese organisations to meet and share information. The restaurant’s website currently provides information on accommodation and job opportunities for Vietnamese students in France.

Each meal served will contribute 20 French centimes (0.20 EUR) to a fund for charitable and cultural activities and scholarships for disadvantaged students in Viet Nam.

Viet Nam woos Japanese investors

Viet Nam offers good opportunities for businesses from Japan’s Ehime prefecture, according to Vietnamese Ambassador to Japan Doan Xuan Hung.

The prioritised areas include the manufacturing of hi-tech and agricultural machinery, textiles and garments production and personnel training, he said.

Speaking in front of more than 200 representatives from research institutes and businesses at a recent seminar in Ehime, the ambassador said both sides will benefit from expanding co-operation.

Vietnamese counsellor in charge of investment promotion Le Huu Quang Huy outlined the favourable conditions for Japanese investors, as well as advantages, urging investors to focus on them.

He put stresses on Viet Nam’s location in the centre of Southeast Asia, an open investment environment and preferential policies, along with the fine development of Viet Nam-Japan relations.

The director of Ichihiro Company, which runs a factory in Viet Nam’s southwestern Tay Ninh Province, shared his experiences in seeking locations, partners and workers in Viet Nam.

Meanwhile, the director of Tact Noda company, which receives Vietnamese trainees, said Viet Nam employed by small and medium-sized businesses in Ehime increased last year despite the general downward trend in numbers of foreign trainees.

At present, 108 Vietnamese trainees are working in Ehime prefecture, he said, noting that there were still difficulties in employing Vietnamese trainees because of high recruitment costs, a language barrier and trainees’ poor understanding of industrial working culture.

Representatives from monetary and financial institutions and universities in Ehime put forth solutions to assist the prefecture’s businesses in investing in Viet Nam and training personnel.

The head of the prefecture will lead a business delegation to Viet Nam to explore the country’s investment environment and seek more Vietnamese partners. 

Trade surplus reaches US$900 mil in February

The General Statistics Office has said that the country’s export turnover in February reached US$7.5 billion while import turnover is estimated at $6.6 billion, showing a trade surplus of $900 million.

Import turnover dropped 38.3 percent since last month, partly due to the long Tet holiday season.

In the first two months of the year, export turnover hit $18.97 billion, an increase of 23.9 percent over the same period last year. While import turnover was $17.3 billion, bringing trade surplus to about $1.7 billion during this period.

On February 25, the Ministry of Agriculture and Rural Development announced the status of aqua-agro-forestry exports in the first two months of 2013.

Accordingly, export turnover was around $4.83 billion, 31.5 percent up over the same period last year.

Export of coffee, tea and cashew nuts fell in quantity but soared in value. Rice exports continued to drop in value despite hike in volume.

Vietnam exported 677,000 tons of rice in January and February,   earning $310 million, an increase of 68.2 percent in volume but reduction of 15.4 percent in value over the same period last year.

China remains the largest rice export market for Vietnam, followed by Singapore, the Republic of Korea and the Philippines.

HCM City plans buses as major means of public transport

Ho Chi Minh City plans to maintain an efficient fleet of buses as the major means of public transport by 2020, according to a proposal for a master plan by the Department of Transport.

 

Under the master plan, an efficient network of buses will ply across the city as a convenient method of public transport and also reduce traffic gridlock.

The plan calls for more use of public buses; an increase in frequency of bus services; use of electronic ticketing on buses and railways; and an efficient underground metro system.

 

Although the city is building a modern metro service, it still will require an efficient public bus transport network.

 

Ho Chi Minh City is planning to reserve land for the construction of bus stations and free parking lots for two-wheelers, to convenience commuters.

 

The current population of 10 million in HCMC is being serviced by nearly 3,000 buses, and the city plans to make buses the major means of public transport in the future, so as to help ease constant traffic congestions, especially during peak hours.

Lam Dong bauxite project will have economic effects: Vinacomin

After the Prime Minister agreed to halt the construction of Ke Ga Port, Deputy Prime Minister Hoang Trung Hai has assigned the Ministry of Industry and Trade to request the Coal and Mineral Industry Group Viet Nam (Vinacomin) to research an alternative plan for production mining project of Tan Rai and Nhan Co bauxite

The research is to find out an immediate and long term plan and will be reported to the Prime Minister in quarter 2 of 2013, Vice PM Hai instructed on Feb 24.

The US$460-million facility, based in the Central Highlands province of Lam Dong, and operated by state coal and mineral group Vinacomin, has sold its very first batches of alumina at US$340 a ton.

However, since the beginning experts raised doubts about the economic effectiveness of the project saying that the plant will be facing a paradox in which more products mean more losses even after the country's first alumina plant already came into operation.

 

Experts argued that the US$340 a ton price will surely gain losses for Tan Rai plant, as real capacity is too low.

“The more production, the bigger losses,” they said, adding that when the plant could recoup investment remains to be seen.

Some others said the plant has already posed many issues during its initial operational state.

“The biggest issue is the problem of transporting the alumina,” they said.

The mineral is currently transported by road, which will result in little effectiveness for Vinacomin as the amount to be transported is as much as millions of tons a year.

At first, Vinacomin planed to transport alumina to the seacoast and build Ke Ga into a big seaport that vessels with more than 10,000 ton capacity can dock.

However, the Ke Ga port building project has been eliminated as uneconomical.

According to Vinacomin, the stop of Ke Ga port project does not affect the two bauxite-alumina project because in the early stages, products can be shipped through the two ports either Go Dau Port or Phu My port.

“But at present the products are only locally consumed as there have yet to be ports for exports,” the report assured.

Vinacomin also affirmed that in the future the price is increased and that means the plant has made profit.

Though the plant incurs losses in its first years of operation, in the long run the production price is calculated on the condition that the world economy is recovered and the plant operates at its full capacity of 650,000 tons a year.

“But it’s necessary that the plant remains operational as there will be huge demand for alumina in the future, and Vietnam will earn money for export the mineral in coming years”, the report writes.

It is not fair to assess the economic efficiency of any project only on the basis of pure economic efficiency without taking into account the socio-economic effects, as well as the significant political results, the security and defense of the project for the local and the Central Highlands.

The bauxite project will create jobs for about 1,500 local workers, contribute to the central and local budgets, facilitate industrial development as well as infrastructure, social and cultural for local people, the report stressed.  

Ha Tinh Province targets industrialization

Nguyen Sinh Hung, Chairman of the National Assembly of Vietnam, held a meeting with major leaders of the northern central province of Ha Tinh on February 24, to review goals and tasks of last year and plans for this year.

Chairman Hung congratulated the local government on their achievements so far and encouraged local authorities to mobilize all possible forces to complete this year’s projects while seriously implementing the Resolutions passed at the 4th Central Conference, on building a stronger communist party.

By overcoming shortcomings and firmly implementing the resolutions issued by the party, Ha Tinh Province expects to become an industrialized province in the near future, accomplishing several social and economic development plans in 2013.

On gathering ideas and opinions for amending the 1992 Constitution of the Social Republic of Vietnam, Chairman Hung stated that every suggestion from the public would be considered.

Sinh instructed local authorities to utilize all means, especially the media, to apprise citizens on the significance of providing practical suggestions to amend the Constitution.

All suggestions will be assessed by the central government in order to build a better draft amendment of the 1992 Constitution.

While listening to reports on the upgrade of National Highway No.1A--on the section going through the outskirts of Ha Tinh City to the south of Ben Thuy Bridge, Chairman Hung suggested that Company No. 475 and Civil Engineering Construction Corporation No. 4 speed up the project so as to fulfill the socio economic development plans of Ha Tinh Province as well as neighboring provinces.

Vietnam-Laos highway link road inaugurated

The Vietnam-Laos highway link road was officially inaugurated at a ceremony held at the international border of Panghok in Phongsaly Province yesterday, February 24.

The 68.2 kilometer highway road links Khoa District in Phongsaly Province in Laos to Tay Trang

border gate in Dien Bien Province in Vietnam. The project was financed by the Vietnamese government at a total cost of US$43 million.

Attending the inaugural ceremony were Vietnamese Deputy Prime Minister Nguyen Xuan Phuc, Lao Deputy Prime Minister Somsavat Lengsavad and other high ranking officials of the two countries.

In his speech, Dep. PM Phuc highlighted the traditional friendship, special solidarity and comprehensive cooperation relations between the two countries.

He also stressed that the National Highway was of great strategic importance for both Vietnam and Laos, enhancing trade between the northwestern provinces of Vietnam and the northern provinces of Laos in particular.

Lao Deputy Prime Minister Somsavat Lengsavad said that the National Highway was of great importance for the socio-economic growth of Laos.

He said this important road would contribute to improving infrastructure and help link Laos to other countries in the region.

Sugar inventory reaches half of output

According to the Vietnam Sugarcane Association, sugar inventory has increased to 322,250 tons this season, accounting for half of the output.

Businesses have produced about 767,842 tons by Mid February but domestic consumption is slow while exports slowed down during the Tet holidays.

The association has so far not received any information from the Ministry of Industry and Trade on sugar exports this year.

Several sugar plants are facing shortage of capital but are still trying to purchase sugarcane at the same price as in early February.

At present, sugarcane price is VND900-970 a kilogram in the central and central highland regions; VND950-1,150 in the southeastern region; and VND855-940 in the Mekong Delta.

In some areas, sugarcane prices have fallen to VND450-520 a kilogram.

Hike in dairy products from March

Milk producers in Ho Chi Minh City have announced a hike in dairy products from March.

Prices of ‘Abbott’ and ‘Dutch Lady’ brands will rise from March, and so will  price of baby formula products for children under six.

Price of domestically made milk will also hike from the middle of March. Milk producers claim that price of raw material and workforce has gone up which now has to be adjusted on the retail price of dairy products.

Agents have been informed on the new price adjustment of 10 percent from March 18.

Do Thai Vuong, director of Abbott Nutritional Vietnam, said the company will raise milk prices by 2-9 percent from March 1. For instance, a 400 gram can of Similac Mom will retail at VND205,000; a 900 gram Gain Plus IQ at VND474,000; and a 1.7 kilogram Pediasure at VND981,000.

On the other hand, Friseland Campina confirmed it will maintain price to support customers this time.

Prior to announcing any price adjustment on baby formula for children under six, businesses are now required by law to report the new prices to the Price Management Agency under the Ministry of Finance.

Vietnam seeks Bruneian energy investment

Vietnam is intent on encouraging oil exploiting powers like Brunei to invest in the nation’s energy projects.

 

Deputy Prime Minister Hoang Trung Hai made the above remark at a February 25 reception for a Brunei Energy Ministry delegation led by its Minister Pehin Yasmin.

Hai praised the cooperation between the Brunei delegation and the Vietnam National Oil and Gas Group (PVN) in realizing the agreements both sides had previously negotiated.

Vietnam is willing to collaborate with Bruneian businesses on projects including liquidized natural gas—both in Vietnam and third countries—as well as on the Dzung Quat refinery’s crude oil supply and export contracts.

The Bruneian Minister said his country is always keen to advance its productive ties with Vietnam in as many fields as possible.

He stressed the importance of increasing bilateral energy cooperation, arguing its opportunities are mutually beneficial and contribute to strengthening the two nations’ friendship and ASEAN relations more generally.

At the meeting with Yasmin the same day, President Sang applauded the results of a working session between the Brunei delegation and the Vietnam National Petroleum Group (PVN) to realize their cooperation agreements. He said the results will further strengthen the two countries’ economic ties.

He spoke highly of Brunei’s ASEAN Presidency and said that the two countries can intensify cooperation in the fields of agriculture, forestry and fishery.

Yasmin said that his visit to Vietnam aims to realise the signed agreements of the two countries’ leaders, especially in oil and gas cooperation.

Regarding the working session with the PVN, he affirmed that the two sides reached a consensus to upgrade their relationship.

Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR