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BUSINESS IN BRIEF 8/6
Supermarket chain
Saigon Co.op has launched its fourth Green Product Consumption Month,
offering many promotions at all its outlets.
The program aims to
encourage more environmentally-friendly consumer habits.
The chain is
offering discounts of up to 50 per cent on more than 2,000 products such as
garments, beauty care products and household appliances from June 3 to 23.
Banks offer
$1.4b housing loans deal
Viet Nam Bank for
Agriculture and Rural Development (Agribank) has officially launched a
lending program encompassing a VND30 trillion (US$1.4 billion) loans package
for home buyers and realty developers.
Agribank is the
third after the Bank for Investment and Development of Viet Nam (BIDV) and
Viet Nam Bank for Industry and Trade (Vietinbank) to do so.
The bank now offers
an annual preferential lending rate of 6 per cent for this year, which will
then be revised by the SBV in the following year, at a rate that is required
to stay below 6 per cent per annum.
It also pledged to
process lending applications for individuals and businesses within 5 and 10
working days, respectively.
Meanwhile, through
BIDV individual and business clients can have their applications processed
within 4 and 20 working days.
HSBC lowers
2013
HSBC’s monthly
report predicts
The banking giant
explains
May’s economic
indicators paint a mixed picture of the economy. While trade, retail sales,
HSBC’s manufacturing PMI, and CPI all point to anemic 5% growth in 2013, the
registered FDI print shows the country remains competitive and continues to
attract healthy capital inflows.
Five-month FDI
registered capital has risen to US$5.1 billion, up 23.5% year on year. Most
of the capital was channeled into the manufacturing sector, providing
much-needed employment and investment amid the austere fiscal and monetary
context and weak domestic demand.
HSBC analysts say
tightening fiscal spending, coupled with low credit growth, has dragged down
domestic activity significantly. While foreign investment will pick up some
of the slack from weaker domestic investment, it is still not enough to
maintain the previous 7 percent levels of growth.
Headline inflation
dropped to 6.35 percent from April’s 6.6 percent, a falling trend fuelled by
weaker food prices and decelerating core prices. Food inflation slid to 1.5%
from 1.7% in April. Food prices have tumbled over the past three months.
Core inflation
slowed to 11.0% year on year from 12.1% in April. HSBC expects the figure
will continue to fall in the coming months thanks to a favourable base effect
and sluggish demand.
Against all odds,
the bank says
HSBC experts
acknowledge that while the AMC’s limited capital base has raised doubts about
the efficacy of the program, its establishment is an important signal to the
market that the government is serious about the reform process.
Impetus for
Vietnam-EU strategic partnership
The European Union
launched an EU-Vietnam Strategic Dialogue Facility in
The 2013-2016
funding will support policy research, technical assistance programs and the
organization of conferences, training courses and communication campaigns.
The EU- Vietnam
Strategic Dialogue Facility aims to support
The Vietnamese
Ministry of Foreign Affairs (MOFA) hopes the program will offer central and
local agency representatives an opportunity to update their understandings of
Vietnam-EU relations, especially in the fields of trade, investment and
Official Development Assistance (ODA), said MOFA Deputy Minister Bui Thanh
Son at a workshop launching the facility.
He asked them to
propose areas of cooperation with reference to the 2012 PCA to foster
relations between
Son noted that the
PCA created a new legal framework for developing Vietnam-EU relations towards
an equal partnership and mutually beneficial, comprehensive cooperation.
While waiting for
ratification, both sides agreed to early implement the agreement on a number
of prioritised areas in the 2011-2012 period, and are preparing for the
2013-2014 period.
Son voiced
Franz Jessen, EU
Ambassador and Head of the EU Delegation to
The workshop
examined reports from former Deputy Prime Minister Vu Khoan and EU, MOFA, and
Ministry of Planning and Investment representatives on subjects like
Vietnam-EU relations, bilateral trade and investment, potential difficulties
and challenges, and the role of Vietnam-EU cooperation in
Trade turnover
between
EU member states
are some of
Seminar
discusses Chief Information Officers ’role
Experts from
Deputy Minister of
Information and Communications Nguyen Minh Hong said recent years have seen
This trend has
helped improve bureaucratic transparency and efficiency benefiting state
agencies, organisations, businesses, and citizens, and part of the success
should be attributed to CIOs, said Hong.
The rapid
development of IT has also required CIOs to reconcile their ideal vision with
the reality of long-term IT development in government ministries and
agencies.
According to RoK
experts, CIOs are responsible for tailoring IT strategies to the requirements
of their assigned departments,, building and expanding agency databases and
information systems, and formulating IT guidelines and regulations that meet
certain technical standards.
During the 2013–2015
period,
Consumer
confidence index surges
According to a
market research company Nielsen report, a large number of Vietnamese
consumers are optimistic about 2013’s first quarter job market.
The 39 percent positive
outlook reading was higher than the 34% in the last quarter of 2012 but lower
than both the 50% in 2012’s first quarter and the regional average of 61%.
Around one third
(33%) of online customers said this December will be conducive to furniture
purchase, up 4% on Q4, 2012 and 7% on Q1, 2012.
Other consumer
demands also rose slightly compared to Q4, 2012, including house decorations
(up 3%), technology products (1%), and clothes (3%). The number of people who
plan to invest in securities jumped a significant 5%.
Saving remains the
dominant Vietnamese consumer trend. As many as 71% of those surveyed reported
planning monthly savings after essential expenses.
Vietnamese
consumers were mostly concerned about economic performance, job security,
health, the cost of living, and rising food prices.
Forval
opens door to more IP investment
The
Tokyo-headquartered firm has just decided enter into ventures with the parks
after a painstaking study of 200 industrial parks in
Forval Corporation
chairman Hideo Okubo said the firm would support Dai An Industrial Park Joint
Stock Company and Tin Nghia Company – the owner of Nhon Trach 3 Industrial
Park to develop sites reserved for Japan’s small- and medium-sized
enterprises (SMEs) and introduce one-stop services to support investors.
“To attract
investments from
“We are also
thinking about investing in these industrial parks. We are now discussing
with the Japan International Cooperation Agency (JICA) for funding our
investment in Dai An and Nhon Trach 3,” added Okubo.
Dai An Industrial
Park is located in northern Hai Duong province, while Nhon Trach 3 Industrial
Park is located in Dong Nai province. Both are good locations for developing
supporting industries. “We learnt that the Vietnamese government wants to
call for investment from foreign SMEs, especially from
Since Forval
Corporation introduced Dai An and Nhon Trach 3 to SMEs in
“In the past,
Japanese SMEs rarely expanded investment overseas, but due to the growing
labour shortage in
In fact, Vietnamese
government has been trying to call for investment from
Aquatic
exports to Africa extend by 15% during Q1
Last year, the
turnover to 25 African countries hit $150 million, a 38 per cent surge from
2011, with key exports including tra fish, shrimp and tuna.
According to the
Ministry of Industry and Trade, Vietnamese exporters have a good opportunity
to promote seafood exports to African countries as the nations have to import
numerous aquatic products to meet their domestic demand and their aquaculture
industry is under-developed.-
Ninh Thuan
aims to increase competitiveness
The central
The promise was
stated by the provincial People's Committee chairman, Nguyen Duc Thanh, at a
conference late last week.
Ninh Thuan jumped
28 places to the 18th position out of 63 cities and provinces. The annual
index is based on a survey conducted by the Viet Nam Chamber of Commerce and
Industry.
The province was
praised by enterprises for its efforts to cut costs for business start-ups,
reduce informal costs and cut time spent on bureaucratic procedures and
inspection, the survey said.
Its labour training
policies and creative provincial leadership in solving problems for
enterprises were also appreciated.-
The Viet Nam
Chamber of Commerce and Industry (VCCI) plans to organise the Yen Bai Trade
and Investment Promotion Conference early next month.
VCCI said it would
also organise business delegations to the province to study the investment
and business environment and projects recommended at the conference.
Yen Bai was a poor
mountainous province which encountered a lot of difficulties in
socio-economic development, VCCI said.
The provincial
authorities had vowed to better facilitate investors and offered incentives
for investors who wanted to invest in the province.
VN firm
launches community development investment
Hoang Anh Gia Lai
Group last Friday kicked off its US$10 million investment program of
community development in a bid to improve life for people in
In the first stages
of the program, the group provided free healthcare services to roughly 1,500
local people in the province's Sre Aung Chhrong Commune; also offering gifts
of rice, salt and sugar to 400 poor local households.
Under the program,
which will last until 2016, the group will also build up community cultural
houses, schools, medical stations and roads in the province, besides giving
sponsorship to local students to study teaching and healthcare in
Tiger Air unveils
promotion to mark anniversary
Singapore-based
Tiger Airways and the Singapore Tourism Board are offering huge discounts on
Viet Nam-Singapore tickets to mark the eighth anniversary of the low cost
carrier's operation on the route.
A one-way ticket to
Cement
market continues solid recovery
Cement sales
increased in May, adding to a rising trend which is expected to continue on
the back of a credit package worth VND30 trillion (US$1.42 billion) for
domestic real estate.
The Ministry of
Construction reported cement consumption in the first five months on the
domestic market had a year-on-year increase of 9 per cent to 19.15 million
tonnes.
Le Van Toi, head of
the Building Material Department at the Ministry of Construction, said that
in the first half of May, some cement factories had difficulty sourcing
clinker due to increased sales the domestic cement market.
The nation had a
total cement consumption at home and abroad of 23.8 million tonnes in the
first five months. In May alone, the total consumption saw a year-on-year
increase of 19 per cent.
Nguyen Thi Tao,
deputy general director of Viet Nam Cement Industry Corp (Vicem) Hoang Thach,
said cement consumption had recovered since the end of March. For the first
quarter, the company had consumed 1.06 million tonnes of cement, 4 per cent
higher than the same period last year.
Hoang Xuan Vinh,
general director of Cam Pha Cement Company, said that in the first quarter
demand exceeded his company's production capacity to reach 618,000 tonnes of
cement.
Luong Quang Khai,
Vicem's chairman, said Vicem's cement sales had recovery in recent weeks
because the bank interest rate had been lower and the domestic real estate
market had shown recovery signs.
In the first
quarter, consumption jumped by 19.2 per cent against its production plans of
4.91 million tonnes of cement, Khai said.
Cement producers
awaited the credit package worth VND30 trillion, which had been approved by
the Government, along with a soft interest rate to lift the real estate
market as well as other related markets such as cement, steel and wood
products.
According to the
Viet Nam Real Estate Association, many property projects had been suspended
due to lack of credit. If those projects received credit from the package to
finish their building, it would promote cement consumption and production.
The package for
housing and property traders was necessary to stimulate the property market
and other related markets that had suffered bad impacts from a stagnating
property market, said Nguyen Tri Hieu, a member of Management Board at the
Ocean Bank.
Vietnam–EU
strategic dialogue facility launched
The Ministry of
Foreign Affairs and the European Union (EU) delegation to
In his opening
speech, Deputy Foreign Minister Bui Thanh Son said one of the facility’s
objectives is to help
The Deputy Minister
expressed his hope that through the seminar, representatives from ministerial
and local agencies will have opportunities to access up-to-date information
and evaluations of both
According to the
Deputy Minister, the PCA signed in June 2012 meets the demand on a new legal
framework, and is a manifestation of the rapidly increasing and dynamic
relations between
The implementation
of the 2011-2012 PCA has successfully concluded, and the two sides are now
discussing the 2013-2014 stage, he added.
Head of the EU
delegation to
The Vietnamese
Government and the EU have identified several prioritised fields for the
early implementation of the PCA, Jessen said, pledging to continue the PCA
approval and implementation process, and make full use of the cooperation
opportunities it may create.
According to him,
the new PCA demonstrates the EU’s commitment to forge a modern, broad-based
and mutually-beneficially partnership with
Also at the
seminar, EU representatives announced the launch of the Vietnam–EU Strategic
Dialogue and related activities to run in 2013.
Accordingly, the EU
delegation to
The facility aims
to enhance strategic dialogues between
It also aims to
support
Despite the
economic crisis, two-way trade between
EU nations are
among the leading investors in
Cement sales on rise
Cement consumption
showed signs of recovery last month with the sales volume up 19%
year-on-year, according to the Ministry of Construction.
Overall, 23.8
million tons of cement was sold in the first five months, meeting 41% of the
year’s plan, in which 19.15 million tons was consumed in the local market, up
9% over the same period in 2012.
The construction
ministry predicts domestic cement output will reach 79.45 million tons in
2013, 81.56 million tons in 2014 and 83.86 million tons in 2015, according to
a report on the Government web portal.
Le Van Toi, head of
the building materials department under the ministry, said that in the first
half of May, some plants found it harder to buy clinker because of the
increase in local cement consumption.
At most large
cement companies, production and sales have improved. Positive signals from
domestic consumption have urged some firms to adjust their export plans.
Nguyen Thi Tao,
deputy general director of VICEM Hoang Thach Co., said consumption had
rebounded since the second half of March and the first week of April. By the
end of the first quarter, Hoang Thach had sold approximately 1.06 million
tons of cement, up 4% year-on-year, exceeding its target.
Although the
property market has not recovered, Hoang Thach is affected less than other
companies because its products are mainly sold to individual customers.
Currently, the company does not have inventory.
Hoang Xuan Vinh,
general director of Cam Pha Cement Co., informed his company in the first
quarter sold about 618,000 tons and produced a volume higher than the
designed capacity.
On average, Cam Pha
exports 35% of its output every year. However, last quarter, the company
exported nearly 50% of its output.
The demand for
cement for large projects has also increased, with bulk cement accounting for
about 35%.
Luong Quang Khai,
chairman of Vietnam Cement Industry Corporation (VICEM), said interest rate
cuts and the warming construction market helped improve VICEM’s sales in
recent weeks.
In the first
quarter, VICEM sold over 4.9 million tons, 19.2% higher than its target, but
still lower than the same period last year. However, the company still
considers this as a good sign.
SBV calls for
transparency in home loan program
The State Bank of
Vietnam (SBV) requests all five lenders participating in the VND30-trillion
home loan program to disclose information about the lending process.
The program is
large-scale in terms of total loan amount, loan term and interest rate, and
is unprecedented. Therefore, it is important that transparency is guaranteed
so that people understand the policy of central authorities, and loans are
given to the right ones, says a notice of SBV issued last Friday. The
preferential home loan program was launched on the following day.
SBV asks lenders to
have separate book keeping for the loans given under the program to make it
easy for inspection and audit later. The five banks selected to provide loans
are BIDV, Vietcombank, Vietinbank, Agribank and Mekong Housing Bank.
SBV and the
Ministry of Construction have set conditions for borrowing loans under this
program. In addition, the two agencies have provided details on the
responsibilities of borrowers, lenders and other persons concerned, and will
impose severe sanctions against wrongdoings.
On that basis,
lenders will issue specific guidelines to their branches and transaction
offices and disclose information in various forms, so that people can make
their financial plans for buying homes and following the procedures for loan
application.
The preferential
home loan program is put under inspection and supervision of the entire
political system, including the State bodies, the internal inspection
department of each bank, district- and ward-level governments, and especially
the people.
VND20 tril.
G-bonds mobilized in May
The State Treasury
of Vietnam mobilized over VND20 trillion via government bond sales last
month, which is lower than April’s figure of VND23 trillion but remains a
strong investment channel for banks awash with funds.
May’s figure
suggests that credit institutions still have a strong demand for government
bonds, according to the agency.
The agency since
the start of the year has mobilized over VND104 trillion worth of government
bonds, meeting 61.3% of the year’s revised target of VND170 trillion.
The Ministry of
Finance earlier intended to raise VND150 trillion from government bond
issuance this year to make up for the State budget deficit and use it for
investment and development. The figure then was revised up to VND170 trillion
given liquidity surplus in banks and high demand for government bonds.
At an auction on
May 29, the State Treasury sold out two, three, and five-year bonds while it
managed to sell only VND250 billion out of VND1 trillion worth of 10-year
notes. Corresponding coupons for four types of bonds were 6.55%, 6.75%, 7.78%
and 9% respectively.
As of May 30, over
VND76.5 trillion worth of investment capital was disbursed via the State
Treasury, meeting 34% of this year’s capital plan, including over VND54
trillion for capital construction projects.
Cooperative
bank of Vietnam set up
The Governor of the
State Bank of Vietnam (SBV) on June 4 granted a licence to establish the
Cooperative Bank of Vietnam at the request of the Central People’s Credit
Fund (CPCF), serving as another funding channel for individuals and
collectives.
Under the licence,
the bank will be transformed from the CPCF and headquartered in Nguyen Thi
Dinh street, Trung Hoa commune, Cau Giay district, Hanoi.
It will have a
chartered capital of 3 trillion VND (about 142 million USD) sourced from the
State, CPCF members and other legal entities.
The bank, which
operates nationwide in a 99-year period, will be allowed to set up a network
of domestic and foreign branches once getting the SBV’s writing approval.
Nation sees
export surge in five months
Vietnam’s exports
reached 49.9 billion USD in the first five months of this year, a rise of
15.1 percent over the same period last year, the General Statistics Office
has reported.
In May alone, the
figure was 10.8 billion USD, up 7.6 percent month-on-month and 11.8 percent
compared to that of a year ago.
In the five-month
period, State-owned businesses saw a 2.1 percent export growth, while FDI
firms enjoyed a 23.3 percent surge in exports, including crude oil.
Meanwhile, Vietnam
imported 12 billion USD worth of goods in May, up 9.4 percent compared to
April’s figure and 16 percent year-on-year. It brought the country’s
five-month total imports to 51.9 billion USD, representing a sharp
year-on-year increase of 16.8 percent.
Trade deficit was
estimated at 1.2 billion USD in May and 1.9 billion USD in the Jan-May
period, equivalent to 11.1 percent and 3.9 percent of the country’s total
exports respectively.
Vietnam:
Rice year-to-date exports top last year
Rice exports hit
2.787 million tonnes in the first five months of 2013, up 10% from a year
earlier, according to the Vietnam Food Association (VFA) and generated a
hefty US$1.2 billion in revenue.
In May alone, the
shipments of the country’s most important export experienced a sharp increase
and stood at 650,000 tonnes of the grain, equating to US$273 million of
revenue.
Vietnam has set a
target to export 7.5 million tonnes of rice in 2013, which is slightly higher
than the 7.72 million tonnes exported last year.
According to the
Ministry of Agriculture and Rural Development, the Mekong Delta region
harvested nearly 10.9 million tonnes of rice from the winter-autumn crop and
it is expected to reap 9.3 million tonnes in the upcoming summer-autumn crop.
Tuna exporters must have “Dolphin Safe” label
The requirement is
part of the Earth Island Institute (EII) policy to protect dolphins and the
maritime environment.
Tuna importers from
the EU, the US and Australia have asked Vietnamese tuna exporters to get the
“Dolphin Safe Tuna” label from the EII for their products exported to these
markets.
The EII has asked
all Vietnamese export businesses to get the State certificates for every
package of their products which confirms the register number of fishing
ships, output, operating field, time, date and place of docking and name of
supervision officials from Vietnamese State agencies.
The Vietnamese
Association of Seafood Exporters and Processors (VASEP) said this is an
important issue, and State agencies must provide adequate information and
data on the right to tuna fishing for the EII and its relevant agencies.
203 seafood
processors licensed to export to Argentina
The National Food
Safety and Quality Service of Argentina (Senasa) has approved the list of 203
Vietnamese seafood processors eligible to export products to Argentina.
The Vietnam
National Agro-Forestry-Fisheries Quality Assurance Department (NAFIQAD) has
asked the eligible exporters to register with NAFIQAD soon to have their
batches inspected and certified before shipped to Argentina.
The exporters should
contact with Argentinean importers to keep abreast of and meet their
requirements before delivering the products, NAFIQAD said.
The Vietnamese food
safety watchdog also asked local processors to learn from Senasa’s notice of
food safety and hygiene to avoid consignment return.
Senasa released a
warning on food safety for Vietnamese seafood processors following a
fact-finding trip in August 2012.
The Vietnam Customs
reports that Vietnamese exports to Argentina totaled US$31 million in the
first two months of 2013. Major export items were computers, electronic
appliances, seafood, and footwear.
Since 2010,
Argentina has emerged as Vietnam’s fourth largest trading partner in South
America.
Argentina will be
one of the most potential markets for Vietnamese enterprises to boost their
exports, especially frozen seafood, in the coming years, experts say.
Can Tho
rice exports on the rise
Can Tho city
exported 77.300 tonnes of rice in May, bringing its total rice export volume
in the first five months of the year to nearly 364,000 tonnes worth US$180
million, up 34 percent against the same period last year.
Rice exports
currently account for 38 percent of the city’s total export turnover.
The increase is
attributed to the city’s timely support for businesses by purchasing nearly
100,000 tonnes of rice from the spring-winter crop for reserves.
Rice exporters have
also promoted marketing to seek new outlets in Asia, Africa, and the Middle
East and signed numerous contracts with foreign customers.
In addition, they
have invested dozens of billions of VND in upgrading production lines to meet
the export demand.
Some businesses
have also authorized other provincial level units to expand the export of
fragrant rice to Europe, North America and other Asian nations.
NA
considers separation of SBV from government
NA deputy proposed
making the State Bank of Vietnam (SBV) and the General Statistics Office
(GSO) become independent bodies during the discussion to revise the 1992
constitution, held on June 4.
NA deputy Nguyen
Van Tien from Tien Giang Province said the revised constitution of 2001
introduced three separate branches of government: the executive, the
legislative and the judicial. However, these branches sill do not have proper
oversight.
According to Tien,
letting the SBV and GSO become independent agencies would be a mean to keep
these three powers in check.
NA deputies also
gave an implied vote of confidence in the work of the State Audit of Vietnam
by showing no objection to their work as an agency independent from the
government.
"I think we
need to separate agencies that often deal with the questions of NA deputies
and deal with issues pertaining to doubts from the government. For example,
during many sessions, the minister of Planning and Investment has been
directed questions as to how the GDP is calculated, and henceforth it has
been up to him to explain for the GSO. It's time that the GSO is separated
from the government," Tien said.
Meanwhile, NA
deputy, Bui Duc Thu, from Lai Chau Province requested an expansion of the
powers of the State Audit.
He said, "Our
financial system consists of three parts. These are public finance, corporate
finance and those having to do with state-owned firms, and personal finance.
Currently, the State Audit Office only have control over public finance,
which creates a large loophole. There is a need to more closely monitor
public assets used for investment."
HCMC
tackles crisis of unsold housing inventory
The People’s
Committee of Ho Chi Minh City convened a meeting on June 4 with related
departments associated with housing and construction to discuss the ongoing
crisis of unsold housing inventory in the City.
According to
statistics given by the Department of Construction, around 308 condominium blocks
in HCMC have had to put on hold all construction for lack of buyers and
frozen property market.
But on the other
side, 736 projects in the City have been implemented, such a 118 in District
2 and 92 in Binh Tan District.
Since the beginning
of the year, 1,877 apartments were sold, accounting for 13 percent of total
apartment inventory but 12,613 apartments are still unsold, which are worth
VND22,414 billion ($1million).
After the
Government issued a Decree to ease difficulties for realty businesses, the
Department of Construction has received proposals to convert commercial
housing projects into social housing projects.
Since then, a 360
apartment project in District 2 will be converted into a hospital and three
other commercial housing projects in Districts 2, Tan Phu, and Binh Chanh
will convert to social housing projects.
The Department of
Construction said it will complete construction of 3,000 new social housing
apartments in 2013 to meet demand for government employees, military
personnel and low-income groups.
In related news, on
June 4, VietinBank in Nha Be District and Hiep Phuoc Industrial Park signed a
contract in which the bank will give credit aid to Hiep Phuoc Industrial Park
for the second phase with a loan of VND555.5 billion($26,624,933) for a
period of 62 months.
On June 4, the
State Bank of Vietnam held a meeting with five banks, namely Vietnam Bank for
Agriculture and Rural Development, Bank for Investment and Development of
Vietnam, Vietnam Joint Stock Commercial Bank for Industry and Trade, Bank for
Foreign Trade of Vietnam, and the Mekong Housing Bank about the government
credit aid package of VND30 trillion ($1.44 billion) for low income groups,
who can borrow at only 6 percent a year to purchase apartments under social
housing projects.
As per the
agreement between State Bank and five banks, the latter have assigned money
for the program and will target borrowers for the loans. Disbursement has
been on since June 1 and will continue until the central bank disburses all
VND30 trillion ($1.44 billion) in next 36 months.
Gov’t to
assist with marketing of summer-autumn rice crop
The Government is
applying a number of measures to help market the summer-autumn rice crop,
which is just getting ready to be harvested in the Mekong Delta, said Truong
Thanh Phong, chairman of Vietnam Food Association (VFA) at a meeting on June
4.
According to VFA,
the Government will purchase one million tons of summer-autumn rice for
stockpiling from June 15 to July 31.
Rice export companies
are currently experiencing a loss of US$25-30 a ton and none want to purchase
more rice. As a result, VFA will have to appoint enterprises to buy rice.
The Government is
encouraging businesses to quickly purchase rice to enjoy preferential
interest rates.
VFA will accept
lower than export price rates and help stimulate domestic price.
This measure might
bring more losses to businesses but it is hoped it will prevent the domestic
rice price from further falling.
VFA said that at
this time relevant sides should not pay much attention to profit margins but
try to circulate the rice market.
Experts say that
present inventory of rice is very high in the world. For instance, Thailand
has 17 million tons and India has 35 million tons in stock.
The two markets that
are expected to import the most are China and Africa.
According to the
United States Department of Agriculture, China will be the largest rice
importing country this year with three million tons.
African countries
are expected to import more rice this year than last year. This market buys
about 6.4-6.5 million tons annually.
Poor
administration leads to budget overspending
NA deputies
discussed the wasteful management that is rampant among local state agencies
and departments.
Minister of Finance
Dinh Tien Dung reported to the NA on the topic on June 5. According to the
report, weak management is rife, leading to chronic overspending. Several
agencies have also used their budgets for the wrong purposes.
In 2010, 3,386
projects were behind schedule and 221 projects violated regulations on
investment. In addition, the management of land and headquarters is ignored
and large amounts of land remain idle.
During the first
eight months of 2012, most of the firms were revealed to have committed
violations such as sham tendering, overspending on contractors.
State-owned firms
also seem unaware about how to cut costs. The Vietnam National Petroleum
Group incurred huge losses in 2011, Petrovietnam Construction Corporation
showed little business efficiency and Saigon Industry Corporation used its
land ineffectively.
"Firms often
expand business despite their limited management and financial capacity. This
has resulted in many losses over the years." the report said.
Waste in the
healthcare and education sectors were also discussed with problems such as
medical facilities equipped with modern technology being wasted as they do
not have capable personnel to use the machines. The report suggested drafting
specific regulations to the two sectors.
Overspending needs
to be addressed and the report proposed to assign specific responsibility to
the agencies. For example, the Ministry of Planning and Investment will take
full responsibility for planning evaluation, investment guidelines and the
Ministry of Construction is responsible for issuing building permits and
price lists.
The NA Finance and
Budget Committee said that most overspending was the results of decisions to
invest in ineffective projects or to make investment without considering the
financial and social factors. That's why penalties and the responsibilities
of the leaders of state agencies needed to be outlined.
Banks
hiding bad debts to face inspection
Banks which try to
hide their bad debts and do not want to sell the debts will face inspections
by the State Bank of Vietnam (SBV).
The measure is
included a plan issued by the prime minister to mitigate bad debts in the
banking sector.
According to the
plan, the State Bank of Vietnam, the Ministry of Finance, the Ministry of
Construction, the Ministry of Justice and the Ministry of Planning and
Investment will co-ordinate efforts to resolve the problem.
The SBV will join
with the ministries and city and provincial people’s committees to carry out
measures to deal with the bad debts.
The SBV will
inspect and conduct compulsory audits or suspend some activities for banks
which try to hide their bad debts and do not conform to the SBV’s solutions
on the settlement of bad debts. These banks will also face restrictions on
paying dividends and assets and share transfers.
The SVB will also
request an increase the charter capital of banks found to have hidden their
bad debts and will also decide a credit growth limit to ensure the safety of
the entire banking system.
Under the project,
the Ministry of Finance and the SBV will co-operate with agencies to work out
a mechanism and plan on dealing with bad debts of the Vietnam Development
banks and state-owned enterprises for submission to the prime minister this
year.
In early March, the
government approved a decree to establish Vietnam Asset Management Company
(VAMC) which will go into operation in 2013.
VAMC is expected to
solve between VND40,000 (USD1.9 billion) and VND70,000 trillion (USD3.33
billion) in bad debts this year, said the State Bank of Vietnam Governor
Nguyen Van Binh.
HCM City
industrial sector expands
Industry and trade
in HCM City have had five consecutive months of growth, even in the face of
national economic challenges.
The city’s policies
on coping with inflation have contributed to steady growth.
In May, the
industrial production index rose by 5.5 percent against the previous month,
and 4.4 percent compared to the same period last year.
Of 26 industries,
22 of them improved capacity, especially in food processing, beverages,
leather and shoes. Only ore mining, tobacco and automobiles were stagnant.
The storage index
for the industrial sector also improved by 0.26 percent.
“The major reason
for this growth is that the Government and related industries have offered
many solutions to overcome difficulties,” said Nguyen Van Lai, Director of
the city’ Industry and Trade Department.
Industrial
production has also increased. By early May, total loans in the city had
reached 873 trillion VND (41 billion USD), an increase of 1.4 percent against
the previous month long period and 15.1 percent compared to the same period
last year.
“However, the
international and national economies face low demand and a high quantity of
stockpiled goods. Lower foreign direct investment, equal to only 43 percent
in the same period last year, has affected industrial production,” Lai added.
To cope with the
situation, the textile and garment industry has expanded local market by
changing its business model but keeping the high quality of exported goods.
For the first five months of the year, the industry grew by 5.4 percent.
The food processing
and beverage industries have also earned good results.
Retail sales and
turnover from services in the city totalled 288 trillion VND (133 billion
USD), a year-on-year increase of 10.4 percent. The figure showed that buying
demand had increased.
To support
enterprises, the Industry and Trade Department has organised meeting with
enterprises. Nine meeting have been held with 100 enterprises thus far.
The department is
also continuing to develop delivery channels to the city outskirts and
processing zones.
Work starts
on HAGL complex in Myanmar
Hoang Anh Gia Lai
(HAGL) Group began construction of a 440 million USD trade centre, hotel and
service office complex in the Myanmar city of Yangon on June 5.
The 8-ha Hoang Anh
Gia Lai Myanmar Centre is the company’s largest investment project at
present. It was financed by the Bank for Investment and Development of
Vietnam (BIDV), Eximbank and Sacombank.
Company chairman
Doan Nguyen Duc said the project will be completed within six to seven years.
He predicted that when operational, it will help meet the city’s demand for
property, which has become “very hot” since Myanmar opened its doors to
foreign investment in 2011.
Office spaces in
Yangon are being rented at 75-150 USD per sq.m per month, while a night in a
hotel costs around 300 USD, according to domestic press.
Myanmar Minister of
Hotel and Tourism U Htay Aung said that the nation plans to hold many major
events in the next few years, including ASEAN summits and tourism forums, so
investment in hotels and other travel-related business has significant
potential.
Last year, about
one million international tourists visited Myanmar, an increase of 20 percent
over the previous year. The number is expected to reach 1.5 million this
year, the minister said.
According to U Htay
Aung, HAGL’s investment represents 26 percent of the total foreign direct
investment capital poured into Myanmar ’s hotels and trade centres.
The company’s total
overseas investment amounts to about 1.5 billion USD.
Hiep Phuoc
industrial park to triple its size
The Ho Chi Minh
City-based Hiep Phuoc industrial park will be expanded to 908.4 hectares with
VND555.5 billion (US$26.664 million) funded by Vietinbank.
The industrial park
currently covers an area of 311.4 hectares in Nha Be district, which houses
95 projects with a total investment of more than US$900 million, said Doan
Hong Tam, General Director of the IP at the loan closing yesterday.
In the second
phase, the industrial park will be expanded by 597 hectares, nearly doubling
its current size.
When expansion is
completed, the Hiep Phuoc industrial park will focus on attracting seaport
services, high-tech and environmentally friendly projects.
Tam said his
company plans to increase the size of the Hiep Phuoc industrial park by an
additional 1,000 hectares in the third phase.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Sáu, 7 tháng 6, 2013
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