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BUSINESS IN BRIEF 3/5
Fish breeding may disappear from
Just few households in
Previously, households in the village often raised fish which were sold at
reasonable prices. The village has been known as one of the biggest
ornamental fish distributors.
However, due to the increasing demand for ornamental fish, and complicated
breeding process, the households have imported varieties of fish for
distribution in the domestic market.
Many kinds of imported fish such as cá la hán (flower horn fish) and cá rồng
(dragon fish) are expensive and often sold to rich people at between
VND700,000 (USD33.3) and tens of millions of VND.
Mr. Tuan, one of few ornamental fish breeders, said, “Now people have turned
to importing fish. Just some households in the villages have still maintained
traditional breeding. They often buy fish from Saigon and
According to the local households, raising ornamental fish gives them only
VND3-4 million (USD142.8-190.4) per month, but taking much time and effort as
well as posing risks. Meanwhile, the imported fish offers them far greater
profits.
Nguyen Van Son, a local ornamental fish breeder said lots of traders have
flocked to the village. His shop earns an income of roughly VND1 million
(USD47.6) per day.
The level of profits depends on scale and different seasons. Ornamental fish
have highest prices at the end of the year and at the beginning of spring
when it is warm. Currently, only 2-3 households have continued breeding,
posing a risk of losing a traditional craft.
Mrs. Yen, a local breeder, said, “Experienced ornamental fish breeders have
become old, while the young opt to do other jobs. Most of the local breeders
import fish due to higher profits. I’m not sure whether Yen Phu ornamental
fish village can continue”.
The
On the global scale,
According to the WB, remittance to Southeast Asian countries totalled 47.96
billion USD in 2012, up 8.43 percent over the previous year, but far lower
than the recorded 109 billion USD.
Remittance to developing countries is expected to grow on average 8.8 percent
per annum for the next three years and is forecast to reach 515 billion USD
in 2015.
Since 2000, overseas remittance flow to developing countries has increased
fourfold.
Ministry proposes minimum wage increase delay
The Ministry of Labour, Invalids and Social Affairs has recommended the
government delay an increase in the minimum wage.
Currently, the minimum wage which took effect from January this year covers
only 62-69% of a worker's minimum living costs.
Under the Labour Code, the minimum wage level should be VND2.6-3.4 million
(USD123.8-161.9) per month.
Earlier, the Ministry of Labour, Invalids, and Social Affairs submitted a
proposal to increase it to a level adequate for basic living needs by 2015.
The minimum wage increase would be 35-27% higher in 2013; rising 25-27% in
2014 and 20-25% in 2015.
However, the ministry has proposed a delay, fearing employers cannot afford
such increases at the moment.
Le Xuan Thanh, deputy head of the Department of Labour and Wage, said the
ministry mulled two alternatives to put it off to 2016 with an annual rise of
18-23% or to 2017 with an increase of 16.5-20% per year, but proposed the
former.
A recent survey by the Fair Labour Association, an international organisation
to protect workers' rights, showed 40% of nearly 3,600 workers said their
salaries failed to cover daily living costs if they worked less than 60 hours
a week.
Dang Thi Hai Ha, from the Fair Labour Association, said nearly 55% of workers
were unaware of negotiation mechanisms between workers and employers.
Rental property
market challenged by recession
Despite being at the busiest trading area in Hanoi, many people living in the
Old Quarter's streets are finding it hard to lease out their houses, even at
much lower prices.
According to the owners, many kinds of business are being threatened by the
on-going economic downturn.
On
Average and small houses on streets near city centre such as Hang Dao or Hang
Ngang can fetch the most handsome price at around VND200 million a month.
For example, residents of a house on
Due to the high rental fees, many businesses have abandoned the Old Quarter
in order to save money.
Trung Hieu, a resident in
"The ad to rent the villa has been up for months now, I even lowered the
price by USD3,000 but no one has bothered to call," he said.
Hang, a house owner on
According to her, house owners on this street are being forced to lower
prices or lose out. Moreover, the money they would lose if they fail to lease
the house for several months is much higher than any reduction.
Pham Thanh Hung, vice head of Cengroup, a real estate consultant company in
Financial
restructuring fails to show results
Despite one year of plans for economic restructuring,
Efforts to lighten industrial inventory, eliminate bad debt and lower
corporate income taxes and value-added taxes and to reduce interest rates for
loans in the real-estate market are only temporary solutions, said Dr. Nguyen
Dinh Cung, Deputy Head of the Central Institute for Economic Management
(CIEM).
He added that such measures are not much different than those taken in 2011.
In his opinion, because the reforms were aimed at enterprises in selected
industries, they do not add up to a viable fix for the entire economy, and
may cause harm because they enable companies to operate inefficiently.
"So far the approach to settling bad debt has focused on the banking
sector instead on the companies which owe the money. As a result, they will
still find it difficult to take out loans to resume business
activities," said Dr. Cung.
Dr. To Anh Duong, from the Vietnam Institute of Economics, agreed, saying
that after one year, the restructuring policy has proved not to be comprehensive
enough, while the banking system is looking at a continued liquidity crisis.
"Exactly how much that needs to be spent on restructuring the financial
system remains unclear, but it will inevitably be a very large amount. The
burden will ultimately lie on the State Bank of
Dr. Tran Du Lich said that the investment in non-core investments made by
state-owned enterprises over the past few years has proven to be a huge
waste.
He added that the government should no longer offer credit guarantees for
state-owned enterprises. This, he said, would force them to apply for loans
from commercial banks and adhere to the free market system. All state-owned
enterprises should be required to have their portfolios listed publicly, just
as listed private companies", he said.
He also suggested that a ministry-level agency be set up under direction of
the National Assembly to manage and monitor state capital.
Asset management
company set for launch
The government will approve a decree to set up a national asset management
company to boost the resolution of bad debts according to a local official.
Minister and Chairman of the Government Office Vu Duc Dam said the Vietnam
Asset Management Company (VAMC) was only one of many measures to deal with
bad debts in the current context. Before the company is established, the
State Bank of Vietnam (SBV) and commercial banks had made efforts to settle
their bad debts.
However, the minister said each bank had to form their own hedge funds under
the State Bank of
The VAMC, under the SBV’s management will help banks and enterprises to deal
with their bad debts quickly. The VAMC is supposed to play an important role
in controlling bad debts which is the main culprit for weak liquidity in the
banking system.
The company has received the Politburo’s in-principle approval. The
government discussed the roadmap to establishing the company at a meeting
last month, but until now nothing seems to have happened.
By the end of February this year,
Lam Dong has
first farm producing weasel coffee
The first farm producing the famed weasel coffee in the Central Highlands
The two-hectare farm at 135E Hoang Hoa Tham Street, Da Lat city, is keeping
as many as 120 weasels (a type of civet) with the permission of the local
forest management agency, and can produce an average of 500 kilograms of
weasel coffee every year.
According to the farm’s owner Nguyen Minh Quoc, every coffee crop, the civets
are fed with highest quality Arabica coffee berries. The coffee beans which
are relatively undigested and intact in their droppings were then collected,
cleaned and processed for sale.
Experts say the enzymes inside weasels’ stomach give the undigested coffee
beans delightful taste and distinctive aroma.
Quoc said, the coffee has been checked and recognised by the Pasteur
Institute of Da Lat and the Nuclear Research Institute for good quality and
hygiene.
The publicizing of weasel coffee production process at the farm contributes
to popularising the quality and trademark of Vietnamese coffee, as well as
creating a new sight-seeing spot for tourists in Da Lat city.
Project on
greenhouse gas emission control launched
A project on improving the Vietnamese industry and trade sectors’ capacity to
control greenhouse gas emissions and increase adaptation to climate change
has been recently launched in
Vietnam Government Portal (VGP) quoted MoIT Deputy Minister Le Duong Quang as
saying that the 3 million USD project will be implemented between 2013 and
2016.
It aims to raise awareness and capacity for policy makers, seek suitable
mechanisms to respond to climate change, reduce greenhouse gas emissions and
tap green trade opportunities to promote the sector’s sustainable production,
he said.
The three-component project will focus on analysing and reviewing current
policies and recommending mechanisms and solutions to reduce emissions
towards a sustainable industrial production.
It will improve policy makers’ awareness of climate change and support the
connectivity among businesses while helping financial institutions and
service suppliers promote the investment in developing a sustainable
industrial production, reducing the emissions and expanding the market.
To realise the project’s targets,
Rice export
price lowered
Local exporters have lowered the offer price of 5% broken rice further, even
though Thailand has announced it will delay the plan for selling off 500,000
tons of rice in stock.
The export offer price of the 5% broken rice is currently US$375-385 a ton,
down US$5 against last week. Meanwhile, offer prices of 25% broken rice and
broken rice are unchanged from the previous week, standing at US$355-365 and
US$335-345 per ton respectively, according to the Vietnam Food Association
(VFA).
The fact that local exporters are bringing down the rice price goes against
the global trend. In the first quarter, global rice export price rose 2%
year-on-year, according to the Food and Agriculture Organization (FAO), while
the average price of Vietnam fell US$44.52 a ton, said VFA.
At recent meetings on the food industry, VFA leaders said rice exporters
lowered offer prices for fear that
Expert Nguyen Dinh Bich said
In the domestic market, rice prices remain stable at low levels. Duong Van
Men, a rice trader in Lap Vo District in Dong Thap, said the fresh paddy IR
50404 currently sold for VND4,400-4,450 per kilo and the dried one was priced
at VND5,000-5,100 a kilo.
The purchasing power for material rice is very weak. The materials for 5%
broken rice and 15% broken rice are now sold at VND6,700-6,750 and
VND6,600-6,650 per kilo respectively.
Low-cost homes
seen as lifeline for troubled developers
Listed realty developers have come up with new business strategies for 2013
including concentrating more on low-cost homes after a year struggling with
slackened housing demand.
Most property companies are looking to the low-cost home segment in their
2013 strategies as local housing demand is rising. In fact, many firms were
able to minimize losses last year by shifting investment to this segment
earlier.
Financial reports of multiple industry players show that they still earned
profits, albeit small, and that the revenues might have come from different
sources, from property trading, financial investment to services.
Truong Anh Tuan, chairman of Hoang Quan Consulting - Service - Trading Real
Estate Corp., said his firm posted more than VND300 billion in sales and
nearly VND20 billion in profits last year. Hoang Quan’s sales and profit are
lower than in previous years but its business result was still healthy in the
context of the dreary market in 2012 when a slew of stocks were labeled bad
or stopped from trading.
Tuan ascribed the positive performance partly to the fact that his company
had focused on developing homes for low-income people with a series of
projects in districts 2, 12, Hoc Mon and Thu Duc in HCMC.
Meanwhile, the firm offered townhouse lots for sale at VND250 million to
VND600 million each in other provinces. For instance, the Cinderella project
in the southern
Hoang Quan announced to take part in the country’s low-cost housing program
with a complex project in the Mekong Delta
Similarly, Thuduc Housing Development Corp. (Thuduc House) recorded a
consolidated after-tax profit of some VND27.5 billion at the end of 2012,
just nearly half of the year’s plan. That was the first time in 11 years that
Thuduc House had posted the lowest after-tax profit as a result of the
worsened 2012 business situation.
Most revenues of Thuduc House came from management of farm produce markets
which posted a growth of 19%, while its sales from realty trading fell
sharply. Entering 2013, the enterprise continues to follow the realty
industry as the core business but will pay more attention to building
low-cost homes like S-Home products.
Facing the same woe, Petro Capital and Infrastructure Investment JSC
(Petroland) experienced a challenging year to achieve sales of VND500 billion
and a meager pre-tax profit of VND956 million. In 2013, Petroland still has
two apartment projects in District 2 and District 7 to be completed and
delivered to homebuyers.
The HCMC Department of Transport last Saturday opened to traffic a steel
structure overpass in Tan Binh District and then began construction of three
more at high-traffic intersections.
The newly-built, one-way Lang Cha Ca overpass is 244 meters long and 6.5
meters wide, and has two lanes, with one for cars and the other for
motorcycles. The cost of the overpass is nearly VND122 billion, with
construction costing VND94 billion.
Le Quyet Thang, head of Urban Traffic Management Unit No. 1, said Lang Cha Ca
intersection connecting Cu Chi, Hoc Mon and District 12 with the city’s
downtown area is a congestion hotspot.
The overpass had been constructed non-stop, even on Tet holiday, so the
project was finished after 81 days of construction, 1.5 months ahead of
schedule.
Lang Cha Ca overpass is the third steel structure flyover to be put into use
in the city after the ones at Thu Duc and Hang Xanh intersections.
Last Saturday the city also launched work on three more steel structure
overpasses at Hoang Hoa Tham-Cong Hoa crossroad in Tan Binh District, Nguyen
Tri Phuong-Ba Thang Hai-Ly Thai To intersection in District 10 and Cay Go
intersection in District 11.
The Y-shaped overpass at Cay Go intersection will cost an estimated VND456
billion.
The one at Nguyen Tri Phuong-Ba Thang Hai-Ly Thai To intersection worth
nearly VND319 billion has a length of 390 meters and a width of 9.5 meters,
and the third one will be 268 meters long with an investment of nearly VND247
billion.
Only automobiles of less than nine seats are allowed to cross these three
overpasses, which are slated for completion by September 30.
CBRE:
The city’s office market in the first quarter experienced strong take up in
both Grade A and Grade B segments, especially in newly completed buildings
and many projects in their final stages of constructions, said Greg Ohan,
director for office services at CBRE.
New projects that came online commanded a higher asking rental, pushing
average rentals up slightly on the fourth quarter of 2012, he added.
CBRE said it saw average Grade A and Grade B asking rents rise marginally by
2.3 percentage points quarter on quarter. After a flat 2012, this year’s
first quarter saw
“This is a trend we expect to continue until at least the fourth quarter of
2013 until the next wave of new supply,” said Ohan.
Net absorption rates rose from more than 17,000 square metres in the fourth
quarter of 2012 to almost 32,000 square metres in this year’s first quarter,
according to CBRE’s key buildings tracker.
New Grade A buildings in District 1 which were completed in the first quarter
such as
The firm also saw a similar strong commitment trend in Grade B buildings from
fringe areas, Ohan said. Buildings such as
Ohan remarked that much of the demand in the first quarter was driven by
existing occupier expansions, while the number of new setups or FDI driven
office take up did not rise. Pharmaceutical, oil and gas, education, legal,
local banks and product sourcing companies lead as the drivers for the first
quarter demand, added Ohan.
The combination of occupiers seeking consolidation and cost containment, with
limited large floor plate availability in District 1, has led to a rising
demand for new developments in non-core District 1 locations.
Ohan said there was no major new supply expected to come online within the
next 4-5 months. Tightening supply and steady demand was expected to keep
asking rents stable and rising marginally.
As cement sector
sours, foreign firms eye M&As
The hard time in
Nguyen Van Diep, chief administrative officer of Vietnam National Cement
Association, said that the mergers and acquisitions (M&As) trend was
considered the most effective tool for restructuring the domestic cement
sector as cement firms were facing great challenges.
In the past three years, there have been approximately 10 M&A deals in
this sector. Foreign investors, mostly from Asean countries, covet
investments in
VAFI explained that under policies to promote domestic consumption of
countries like
Domestic entities seem financially unable or unwilling to purchase local
cement factories. For example, state-run Vietnam Cement Industry Corporation
(Vicem), one of
Nghiem Hoang Son, deputy director of Peakward Vietnam Ltd, a subsidiary of
Hong Kong’s Peakward Enterprises Holding Ltd, predicted that M&A
activities in
Managing director Tan Sri Francis Yeoh of
Previously, PT. Semen Indonesia Tbk, Indonesia’s largest cement producer,
bought Thang Long cement plant.
Son said that if more foreign investors took part in the game, it would
change
Efforts underway
to speed up customs procedures
Efforts are underway to help ease burdens imposed on businesses
involving in customs check.
The Ministry of Finance has teamed up with the Vietnam Chamber of Commerce
and Industry and US Agency for International Development (USAID) sourcing
comments from the business community upon the amended Customs Law project.
Deputy Minister of Finance Do Hoang Anh Tuan acknowledged that the time
needed for customs check in
“There were multiple reasons slowing customs check process, of them customs
related factor accounted for around 30 per cent,” Tuan said. The amended
Customs Law, he said, would strive to achieve three main targets, including
the customs process reaching international standards; reforming
administrative procedures and controlling risk in trade practice.
According to USAID mission director Joakim Parker, Vietnam is currently
ranked 74th among world countries in business facilitation aspect albeit the
application of e-customs has helped the country shorten the time for customs
check, meanwhile cargo clearance time plays a vital part in accelerating
economic growth.
“If average cargo clearance time was shortened by one day, it would add 0.5
per cent to gross domestic product (GDP) growth,” Joakim noted.
In the amended Customs Law project, the content concerning customs procedure
reforms has captured special attention from businesses.
Under the draft Law, the time for customs officers to check enterprise
records must not exceed two working hours and handle cargo check not exceed
eight working hours.
Besides, also in light of the draft Law customs declarations would be the
only paper needed to show when businesses do customs procedures.
The regulations on priority enterprise regime are also a matter attracting
great attention.
General Department of Customs deputy chief Vu Ngoc Anh said albeit existing
Customs Law allowed custom check exemption towards priority enterprises, the
conditions for enjoying the priority regime remained unclear. Thereby, the
draft Law has contained regulations on priority regime towards enterprises,
conditions to apply, the rights and responsibilities of customs bodies and
priority regime recipients.
A stakeholder in the amended Customs Law project, PetroVietnam, assumed
containing customs records up to 10 years would be unfeasible and proposed
the customs sector slash the time for keeping files to at most five years and
consider e-storage of these files.
Chairwoman of tax consulting firm C&A Dang Thi Binh An proposed the
amended Customs Law be added with regulations on the rights and obligations
of the agents handling customs declaration services to enhance
professionalism.
Besides, the Law should clarify the responsibilities of customs bodies and
head of inspection team about check results and give opportunities for
involving businesses/individuals to explain check results.
Garment export
to new markets sees strong growth
Vietnam’s garment and textile export saw strong growth in several new markets
in the first quarter of this year, with the rate as high as 134 percent in
Norway and 120 percent in New Zealand, according to statistics from the
General Customs Department.
Garment export to
The ASEAN as a whole also bought more garment and textile products from
Government
should ensure milk quality
Better co-operation among agencies, the media and consumers was needed to
crack down on milk-related violations and ensure a healthy market in
The statement was made on April 26 by Do Thanh Lam, vice head of the Market
Management Department under the Ministry of Industry and Trade.
Joining an online meeting on milk marketing prices and quality held by the
Government's web portal, Lam highlighted the importance of close
collaboration to enable consumers to buy quality milk products at fair
prices.
He mentioned the exposure of a scandal involving imported Danlait milk early
this year as evidence of successful co-operation. After mothers raised their
doubt about the milk, which allegedly led to children losing weight,
inspections were conducted and the importing company had to account for the
wrong labelling.
An investigation revealed that the local importer paid about VND80,000 per
can but sold it for nearly VND450,000.
Confused about the quality of milk in the domestic market, many parents
preferred to used products brought in as carry-on luggage, Lam said.
Consumers have raised concerns most about recent price hikes for milk
products. In the last six years, prices have multiplied about 30 times,
adding a huge burden for many young families.
Pham Vu Anh, Vice Director of the Finance Ministry's Price Management
Department, said that companies often labelled milk powder for children under
six years as "supplementary nutrients".
This excluded the formula from being placed on a list of price-stabilised
products, so companies don't have to ask for permission to raise prices.
The department has called for an end to this practice, Anh said.
He said that as of this year when the Price Law came into operation, local
finance departments co-ordinated with tax and market-watch offices to tighten
inspection over milk and nutrient products.
Le Hoang, Vice Head of the Foodstuff Management Division under the Food
Safety Department at the Health Ministry, said that at department website:
vfa.gov.vn, consumers could seek information about products that were legally
certified as milk products.
Dak Lak launches
third instant coffee mill
Ngon Coffee Ltd. Co. on April 28 put into operation a 100 percent
India-invested instant coffee processing plant in Cu Kuin district, the
Central Highlands
The VND1 trillion plant has a total annum capacity of 10,000 tonnes of coffee
products, which are mainly for export. It creates stable jobs for over 200
local ethnic people.
Dak Lak is currently home to the country’s biggest coffee growing area with
over 200,000 hectares, and three coffee processing mills with an annual
capacity ranging from 2,500 tonnes to 60,000 tonnes.
Last year,
Dak Lak province alone produces 400,000 tonnes of coffee beans and makes an
export turnover of about $700 million per year.
Ha Long builder
launches 53,000-tone cargo carrier
Ha Long Shipbuilder of the Vietnam Ship Industry Group successfully launched
a 53,000-tone ship named THOR BREEZE on April 29th in Quang Ninh.
The ship is 190m long, 32,26m wide, 17.50m high and has a tonnage of 65,700
sqm and the main engine of MAN B&W 9.480 KW.
The ship has double decks and 5 holds of cargo. It is also equipped with 4
cranes, allowing self- loading and unloading cargo, and runs at 14 nautical
miles per hour.
This is the 10th 53,000-tone ship the company builds for international ship-owners
on the commercial orders.
All ships of this kind are designed by Danish Company Carl Bro, equipped with
modern equipment and devices, meeting the standards of DNV and other latest
international maritime conventions.
Under the set plan, after the launch, Ha Long builder will quickly install
equipment and devices under the contracts to hand the ship over to the ship
owner Thoresen Thai, Thailand in the June-September quarter of 2013.
Canon opens
first Image Square in Hanoi
Canon last Saturday put into operation its first Image Square outlet at the
Vincom Tower shopping center in Hanoi where customers can experience the
latest products of the Japanese firm.
Image Square is the brand name of a chain of stores retailing high-quality
products made by Canon, such as digital cameras, accessories and lens, video
cameras, photo printers and inkjet printers.
Image Square is where users can experience the latest Canon products with
professional advice and customer services before getting their most favorite items.
Photography seminars and training courses will be organized at the store for
the benefit of customers.
Canon will also lure customers via promotional programs at the store. Kensaku
Konishi, president and CEO of Canon Singapore, said Image Square has been a
great successful business model in Asia and that his firm wants to expand it
to Vietnam as a growth market.
Canon opened Image Square in Hanoi after the first store was set up in HCMC
six months ago, which is performing well. The company is looking to open a
total of 20 stores nationwide using the same model by the end of next year.
The Image Square system was first launched in India, with a total of 100
outlets active there at the end of last year.
Eximbank
shareholders okay merger plan
Shareholders of Vietnam Export Import Bank (Eximbank) have approved a plan to
weigh the possibility of merging with other banks, with the board of
directors tasked with finding ways to realize the plan.
Le Hung Dung, board chairman of Eximbank, said the bank was planning to merge
with others to expand its network, citing State Bank of Vietnam restrictions
on banking sector expansion as a reason.
To develop business in a long term, the bank will need to have well-developed
facilities. “Eximbank has only 217 points of transaction nationwide while
Sacombank owns over 400, not to mention branches in Laos and Cambodia.
Similarly, Sacombank earned VND850 billion in pre-tax profit in the first
quarter while Eximbank earnings had totaled only VND470 billion in the year to
April 24,” Dung said.
“Eximbank management has found that Sacombank’s higher profit resulted from
its extensive network, and better borrowing and lending operations.”
If five branches were set up each year, Eximbank will need 40 years to have
the same number of branches as Samcombank’s. “Therefore, merging with other
banks can help Eximbank speed up expansion in the coming years,” he said.
Responding to a question about this year’s dividend of 12% which is lower
than last year, Truong Van Phuoc, general director of Eximbank, said the
profit target for this year was VND3.2 trillion, 12.2% higher than last year,
but the bank’s chartered capital is estimated to rise 6.12% this year, so the
dividend would not be lower.
The bank might miss the profit target. A sharp interest rate reduction of six
percentage points last year and another round of rate reductions this year
have impacted on the bank’s profitability. Eximbank incurred a loss of VND800
billion after the interest rates on existing loans were cut to below 15% and
then 13%, according to Phuoc.
Regarding gold trading, Phuoc said Eximbank sold gold to intervene in the
market in late 2011 and early 2012 when the domestic gold price was VND1.5
million per tael higher than the global market level. The bank late last year
bought back the gold but is still in short of one ton.
The mobilization of gold from the public with rates of 0.5-0.7% per year and
lending in Vietnam dong with rates of 10-12% can bring in profits for the
bank.
BIDV wants to
list stock this year
Bank for Investment and Development of Vietnam, or BIDV, during its annual
general meeting last Friday said it would list on the local stock market
within this year as the market has been better than in the previous year.
Speaking at the meeting, BIDV chairman Tran Bac Ha said that the bank has
plans offer shares to strategic shareholders after listing.
Ha also offered an apology for previous listing postponements. “We are sorry
for official or unofficial announcements about the listing plan in the local
media earlier,” Ha said.
Last year, BIDV’s listing plan was considered amid the poor performance of
the economy and stock market, prompting both BIDV and the Government to
carefully weigh this plan. However, if the market is better this year, the
bank will certainly carry out this plan, Ha explained.
BIDV leaders during the meeting also agreed in principle to list on the
Hochiminh Stock Exchange (HOSE) in the 2013-2014 period. Shareholders
assigned the board of the directors to decide listing time given
consideration of developments on the market and HOSE’s guidelines.
Ha said BIDV after listing will need long-term investors.
Two days earlier, the bank sent a notice to shareholders to instruct share
ownership transfer to boost liquidity of its stock.
As of the end of last year, BIDV had total assets of nearly VND485 trillion,
up 19.5%. Its mobilized capital reached a three-year high of VND358 trillion,
a 27% year-on-year increase.
This year, the bank has plans to raise mobilized capital by 13% and obtain
credit growth of 12-16.5% through priority loan programs. Its pre-tax profit
is expected at over VND4.7 trillion.
DongA Bank to
restructure financial bodies
DongA Bank will focus on restructuring its securities firm and fund
management company this year after poor operations of the two enterprises
caused heavy losses in 2012.
Last year, the bank suffered a loss of nearly VND138 billion due to foreign
currency trading and over VND58 billion from stock investment, doubling that
of 2011. DongA Securities Company incurred a loss of over VND30 billion.
Speaking at the annual general meeting on Saturday, DongA Bank general
director Tran Phuong Binh said that the lender is able to make investments
only through the securities firm in the coming time. So, it is necessary to
maintain operation of the broker.
The lender had yet to decide share sales to strategic companies. Pham Van Bu,
chairman of the bank, said that many domestic and foreign investors have come
to seek share purchase opportunities but the bank will not consider this
matter until its charter capital has been increased.
This year, DongA Bank has plans to raise its charter capital to VND6
trillion. This plan got approval last year but has yet to be realized due to
difficulties of the banking system.
Binh said that capital increase is necessary for the bank to maintain
development and boost lending activities. The bank has plans to issue shares
to existing shareholders to raise capital in the fourth quarter.
Last year, its after-tax profit tumbled to only VND777 billion given
deductions for reserve funds. The bank strongly increased deductions for
these funds from VND296 billion to nearly VND632 billion.
Besides, reduction of lending rates of old loans to below 15% per annum as
requested by the Government also hurt its business results.
Concerning remuneration of board members, Vu Thi Vang, a member of the board
of directors, said that each member is paid over VND30 million a month, which
is rather low compared to other banks.
This year, the bank has plans to reach VND85 trillion in total assets, up
23%, and credit growth rate of 9%. It targets to obtain VND1 trillion in
pre-tax profit, a 29% year-on-year increase.
DongA Bank will set up a project to deduct an additional VND400 billion for
reserve funds. This sum will be added to its profit if the bank needs no more
deductions at the end of the year.
Thomson Reuters
GFMS: Gold still being smuggled into Vietnam
Plenty of gold is still being smuggled into the country, according to a senior
analyst of Thomson Reuters GFMS.
Cameron Alexander, who is responsible for market research in Vietnam and
other Southeast Asian countries at Thomson Reuters GFMS, said there remains a
lot of gold finding its way to Vietnam informally.
Alexander did not give estimates on the percentage of smuggled gold in total
gold consumption but said different sources of evidence indicated gold is
still flowing into the domestic economy through informal channels.
Market surveys done in neighboring countries are clear proof of gold being
smuggled into Vietnam, she said.
In the past when Vietnam had a couple of gold processing companies, a
majority of gold imported for processing into an investment vehicle, she
said, but now SJC is the nation’s only gold processor, so imported gold is
mainly used for jewelry production.
Thomson Reuters GFMS provides information and data for the World Gold Council
to produce reports and analyses on gold.
According to a report on gold demand trends in 2012 by the World Gold
Council, Vietnam’s demand for gold bars in 2012 amounted to 65.6 tons, on top
of 11.4 tons of jewelry made from this yellow metal. The respective figures
of the previous year were 87.8 tons and 13 tons.
In terms of value, the country’s gold consumption fell 20% since the value of
gold demand in 2012 totaled US$4.1 billion compared to the US$5.1 billion a
year earlier.
A source from the gold council said gold demand is the total amount of gold
jewelry and bars consumed in a country; in other words, that is the total
volume directly consumed by individuals.
In other countries, consumers usually buy gold jewelry as a long-term store
of value but Vietnamese consumers have a different approach; they have
repeated transactions of the same amount of gold.
For example, an individual could convert cash into gold to pay for a house he
or she bought and then the house seller sold the gold for money. Such a
transaction could be repeated several times, thus creating huge revenues for
gold trading firms.
Cameron Alexander of Thomson Reuters GFMS said that regarding consumption,
efforts had been made to give out net figures, meaning repeated transactions
were excluded after collecting data from major gold traders.
Bosch qualified
for high technology status in Vietnam
Bosch has been recognized in-principle as a high-technology company by the
Prime Minister of Vietnam, hence the leading global supplier of technology
and services will be eligible for tax incentives under this category to
facilitate its ongoing expansion and investment in Vietnam.
The qualification approval process involved the ministries of Planning and
Investment; Science and Technology; Finance; and Industry of Trade prior to a
final review by the Prime Minister, according to a statement of the company.
As recognized by the Government as a hi-tech company, Bosch Vietnam's project
will receive the highest tax incentives, Vo Quang Hue, managing director of
Bosch Vietnam, told the Daily on the phone on Thursday.
“We view the high-tech qualification as an affirmation of Bosch as a global
leader in innovation and technology,” Hue said, adding that “We would like to
thank the Prime Minister and various ministries, as well as Dong Nai Province
authorities for their invaluable and continued support.”
Bosch established its first wholly-owned subsidiary in Vietnam in 2008 for
trading, as well as investment in a Continuously Variable Transmission (CVT)
push-belt manufacturing plant.
In 2011, the high-technology plant opened its doors at the Long Thanh
Industrial Zone in Dong Nai. The total investment for the plant is expected
to amount to 230 million euros by 2015 versus 110 million euros at present.
“We are heartened by the progressive direction that the Government is taking
to not only attract new foreign investments into the country, but also to
incentivise existing companies to expand their operations within the
company,” Martin Hayes, president of Bosch Southeast Asia, said in a
statement. “We believe this decision demonstrates Vietnam as a pro-investment
country not only to other business divisions within Bosch, but to the rest of
the world as well.”
According to the World Intellectual Property Organization (WIPO), Bosch
ranked fifth in the world in 2011 for the most number of patents filed with
the Patent Cooperation Treaty (PCT). In 2012, Bosch filed nearly 4,800
patents worldwide, with 9.1% of its sales revenue that amounted to 4.8
billion euros invested back into Research and Development.
ACCA welcomes
123 new members
The Association of Chartered Certified Accountants, or ACCA, on Thursday
granted membership certificates to 123 members in Vietnam, including 67 ones
in HCMC.
The ACCA membership is considered as international passport for those in the
financial and accounting industry. This is an important condition for
auditors to prove their capability as the ACCA program is widely recognized
in the world.
Stephen Heathcote, executive director of markets at ACCA, said that the
program helps increase the number of qualified financial experts in Vietnam.
Designed to open new opportunities for accountants in developing countries,
the program is suitable with socioeconomic conditions and education system in
the country. ACCA members will make valuable contributions to the local
economy, Heathcote said.
ACCA on Thursday also gave partner certificates to Vinacapital, TNK Vietnam
B.V Company and Ecovis STT Vietnam Company among others.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Năm, 2 tháng 5, 2013
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