|
BUSINESS IN BRIEF 3/8
ACB
gets ready to sell debt
The
Asia Commercial Bank (ACB) is considering the sale of VND1.5 trillion
(US$71.5 million) worth of bad debts to the Viet Nam Assets Management
Company (VAMC).
The
bank is the first to voice the possibility of selling bad debt to VAMC,
established on July 26.
General
Director of ACB Do Minh Toan said the sum accounted for 50 per cent of the
bank's total bad debt.
ACB
reportedly owns up to VND3,090 billion (US$147 million) of bad debt, 20 per
cent more than it did last year. It is the fastest increase in bad debt
holdings in the bank's 20 years of operation.
Military
Bank wins award for internet payments
The
Military Bank (MB) has won the Excellent Electronic International Payment
award (or STP certificate) from Wells Fargo, one of the three largest banks
in the
This
award is given to banks that make huge amounts of international payment
transfers using the Wells Fargo Bank and have a straight through processing
(STP) rate of more than 90 per cent.
The
reward is in recognition of MB's new quicker service when processing
transactions, that meets international standards, giving their customers a
better deal.
In
2012, MB provided the best international payment services for customers
recording a STP rate of more than 97 per cent.-
The
authorities in the central port city of
From
today, people registering their vehicles now only have to pay 10 per cent of
the vehicle's sale price, down from the previous fee of 15 per cent.
The
city, which is the second municipality to cut its fees after Ha Noi, hopes to
boost car sales and support car dealerships in financial difficulties.
Agents
for Toyota Motors Viet Nam, Hyundai, Kia and Ford in central Da Nang City
said that the number of orders they have received for new cars has increased
substantially since last month when the reduction in the registration fee was
announced.-
New
cyber service to provide online gold trading
TienPhong
Bank on Wednesday launched its new eGold service that enables customers to
trade gold through internet and mobile banking channels.
It is
the first bank to provide online gold trading in
The
chairman of TienPhong, Do Minh Phu, said the service would help to reduce
costs for the bank and its customers and more importantly, limit the level of
risk during gold transactions.
The
service will accept transactions from the Sai Gon Jewelry Company (SJC) gold
and several types of gold rings from the DOJI Gold and Gemstone Group.
Phu
said that after transactions have been completed, customers can collect their
gold from the bank's transaction points or can have them held by the bank.
The trading prices will follow the listed prices.
The
Deputy Governor of the State Bank of
The
service was developed with support from DOJI, one of the banks' major
shareholders.
eGold
can be transacted by mobile devices using iOs and Android operating systems.
Local
manufacturing sector improves slightly in July
Output
and new orders fell at weaker rates and employment was unchanged, it said.
The
seasonally adjusted Purchasing Managers' Index registered 48.5 in July, an
improvement on June's 46.4, but, by remaining below the no-change mark of 50,
it signaled a third successive monthly contraction of the manufacturing
sector.
Output
and new orders both continued to fall in July, but at slower rates,
reflecting soft underlying market conditions, and weakened purchasing power.
The
net decline in new orders was partly driven by a decline in new business from
abroad as new export orders fell for a second successive month and at the
fastest rate since the start of the year.
Excess
production was used to build inventories, with stocks of finished goods
rising at the sharpest pace since June last year. Inventories have now risen
for two months in a row.
On the
employment front, Vietnamese manufacturers left staffing levels unchanged
during July following two months of contraction.
While
some respondents added to payroll numbers to help bolster production, others
responded to reduced new orders by cutting staff levels.
Prices
were cut further in July, the fourth month in succession that a net fall has
been observed.
Discounts
were reported to reflect intensifying market competition and efforts to
stimulate sales. There was some evidence that prices were reduced to help
clear excess inventories.
In
contrast, costs continued to rise. Inflation has now been registered for
seven months in a row, with a limited supply of inputs reported to have
pushed up prices. There was also evidence that a stronger US dollar raised
import costs.
Trinh
Nguyen, Asia Economist at HSBC, said: "The further deterioration of
"The
SBV recently reduced the OMO rate by 50 basis points to ease liquidity
conditions.
"But
that is likely a stop-gap solution as fundamental reforms are required to
resolve
The
HSBC Vietnam Manufacturing PMI is based on data compiled from monthly replies
to questionnaires sent to purchase executives at around 400 manufacturing
companies.
Power
price rises on back of coal, gas hike
The
price of electricity has been raised to an average 1,508.85 VND per kWh
(exclusive of value added tax) starting August 1, an increase of 71.85 VND (5
percent).
The
move was announced by the Ministry of Industry and Trade on July 31.
The
new electricity price will range from 993 VND per kWh (0.046 USD) to 2,420
VND per kWh (0.1142 USD) for households.
The
adjustment aims to partly compensate for the increased cost of power
generation caused by increased coal and gas prices.
Poor
and low-income households that use 0 to 50 kWh per month will be charged the
same amount (993 VND) as before but households that use 100-400 kWh per month
will be charged an additional 6,800 VND to 37,000 VND per month.
The
last electricity price rise was on December 22 last year, with an increase of
5 percent (or 68 VND per kWh) to 1,437 VND per kWh.
The
latest rise is expected to cause concern among the public and businesses, many
of which are struggling to cope with the economic recession.
Foreign
investor confidence improves
The
confidence of foreign investors in
The
country's credit risk level, measured by the Credit Default Swap (CDS)
coefficient, had been lowered from over 300 points in the same period last
year to around 220 points on July 23.
The
committee said in its economic report for the first seven months of the year
released on August 1 that the monetary and financial market has been
improved, contributing to the economic stability and reducing risks.
Interest
rates fell from late last year and liquidity of the banking system was much
better than in the previous period as Lease Rental Discounting (LRD)
continued to decline.
It
added that the exchange rates had been fluctuating in a short period after
the State Bank of
In
addition, there were some other factors causing slight effects on the
exchange rate, including demand to balance and adjust forex positions of
commercial banks and businesses.
Foreign
investors adjusted investment portfolios as they withdrew approximately 450
million USD on the bond market and around 100 million USD on the stock
market.
However,
the committee said the exchange rate fluctuation would be temporary and
supply and demand of foreign currency in the second half of the year would be
stable. Foreign reserves were also forecast to continue to increase.
Seven
month retail figures post 4.9 percent increase
According
to the General Statistics Office, total retail sales and services were
estimated at VND213.3 trillion in July, up 0.4 percent compared to the
previous month and 12.8 percent year-on-year.
In the
first seven months of this year, total retail sales and services reached
VND1,480 trillion, up 12 percent year-on-year.
Of the
seven-month total retail sales and services, trade reached VND1,140 trillion,
up 11.4 percent, accounting for 77 percent; hotels and restaurants hit VND179
trillion, up 14.7 percent, accounting for 12 percent; services touched VND151
trillion, up 14.9 percent, accounting for 10 percent; and tourism was at
VND14.3 trillion, up 2 percent, accounting for 1 percent.
Challenges
face sugar sector before next crop
Many
challenges lie ahead for the sugar sector, what with slower consumption,
excess supply as compared to demand, and unchecked smuggling of sugar across
borders.
Sugar
manufacturers have so far processed 19 million tons of sugarcane to yield
1.53 million tons of sugar, an increase of 2.2 tons over the previous crop,
according to the Ministry of Agriculture and Rural Development.
In
2011 and 2012, about 298,200 hectares of sugarcane was cultivated nationwide,
15,000 hectares more than the previous crop, with yield of 63.9 tons per
hectare.
By
July 2013, sugar inventory increased to nearly 426,000 tons, about 187,000
tons more than in the same period last year.
In
August, September and October of 2012, sugarcane processed across the country
was 190,000 million tons, whereas domestic sugar consumption is only 230,000
tons and imported sugar is 40,000 tons.
Sugar
supply is now far in excess of demand by about 200,000 tons, before the next
sugarcane crop. This puts huge pressure on sugar plants, said Doan Xuan Hoa,
deputy director of the Department of Processing and Trade for
Agro-Forestry-Fisheries Products and Salt Production.
As per
an International Sugar Organization report, world sugar output was more than
187 million tons by May end, 7.5 million tons higher than in the last crop.
Sugar
supply is thus far in excess of demand by about 10 million tons whereas it is
forecast that sugar output in the 2013-2014 crop will be in excess of 1.5
million tons.
Despite
low price of sugar in the market, plants cannot reduce price of sugarcane,
resulting in some plants temporarily shutting down.
In
addition, farmers have been forced to reap sugarcane early to avoid expected
flooding in the Mekong Delta Province of Hau Giang.
The
Vietnam Sugar Association has proposed to the Government to have flexible
policies to boost sugar exports to
EVN
to increase power price from August
Vietnam
Electricity on July 31 unexpectedly announced an increase of 5 percent in
power price from August 1.
Accordingly,
power price will now be VND1,508.85 per kWh, not including value added tax,
up by 5 percent on the current power price of VND1,437 per kWh.
The
state-run power company explained that the adjustment in power price is to
cover part increase in power generation cost as the price of coal and gas has
surged, especially, coal has risen 37-41 percent since April 20 this year.
This
increase in power price will not have any effect on poor and low-income
households who consume zero to 50 kWh, but households consuming 100-400 kWh
per month will be charged an additional VND6,800-37,200 per month.
Singaporean
businesses turn attention to Vietnam
Siu
Lin Leow,
Siu
made her remark at an August 1 meeting in
Singaporean
companies have invested their hopes as well as their resources in their
Vietnam-based operations, she said.
Siu
expressed pride in the current state of the two countries’ relations, with
significant bilateral achievements recorded in economics, education, health
care, culture, and national defence.
The
strength of the political links between
Recent
statistics reveal
HCM
City People’s Committee Vice Chairman Le Manh Ha said the more than 500
Singaporean businesses calling the city home testify to health of the two
countries’ economic cooperation.
Malaysian
giant joins US$3.5 billion power plant
The
Ministry of Industry and Trade (MoIT) and Malaysian Toyo-Ink Corporation on
August 1 signed a Memorandum of Understanding (MoU) on the Hau River 2
thermal power plant to be built under the build-operate-transfer (BOT) model.
The
US$3.5 billion plant, which comprises two turbine generators with a total
capacity of 2,000 MW, will use imported coal to supply electricity.
The
first generator of the plant is expected to start commercial production in
the second quarter of 2021, and the entire plant in the second quarter of the
following year.
Song
Kok Cheong, CEO of Toyo-Ink, said the corporation has worked with Vietnam
Electricity (EVN), other related agencies, localities and banks to run the
project smoothly.
He
also committed to following the progress and ensuring the project’s quality
as set by the MoIT.
Deputy
Minister of Industry and Trade Le Duong Quang affirmed that
To
meet the goal, the Vietnamese Government has issued policies and incentives
to encourage investors, both in and out of the country, to join in building
the core constructions in different cooperation forms, including the BOT
model, he said.
SBV
keeps close watch on lending
The
State Bank of
The
move is expected to ensure consumer-lending operations comply with applicable
regulations and protect the rights of borrowers.
Accordingly,
branches, transaction offices and the service introduction points of credit
institutions must publish detailed interest rate information applicable to
each product group and each loan product.
Additionally,
the SBV branches, in collaboration with the banking supervisory agency, must
strictly handle violations detected through inspecting and monitoring the
activities of credit institutions in the respective areas.
The
move was made after experts recently said that some banks have loosened their
lending conditions for consumer loans to boost lending since deposits
continue to rise amid slow credit growth. Some even offered consumer loans
without mortgages or collateral.
The
SBV reported that total deposits rose 9.48% in the first seven months of the
year, while lending increased only 4.91%.
Additionally,
the credit growth target of 12% set by the central bank for 2013 has also
made many banks seek ways to loosen their lending conditions. Previously,
banks applied strict requirements to their lending conditions for consumer
loans in order to limit risks and avoid bad debts.
A
foreign invested bank is offering borrowers loans as high as VND500 million
(US$23,800), with interest rates at about 1.75% per month, on gradually
decreased outstanding loans (equaling to 0.97% per month on fixed lending
interest rate) without mortgages or collateral.
Another
commercial bank is also trying to attract borrowers by giving shopping
vouchers worth up to VND1 million (US$47.6) and an interest rate of 1.5% per
month (18% per year), if they apply for 60-month consumer loans.
Experts
said it is clear that lowering the credit standards may put banks into risk,
which also significantly affects the credit quality of the entire banking
system.
Bad
debts are on the rise, if banks try to achieve credit growth at any cost, it
will create bad consequences for the entire banking system, as well as the
economy, expert warned.
The
Ministry of Industry and Trade (MoIT) and Malaysian Toyo-Ink Corporation on
August 1 signed a Memorandum of Understanding (MoU) on the Hau River 2
thermal power plant, which will be built towards the build-operate-transfer
(BOT) model.
The
plant, which will have a total capacity of 2,000 MW, comprises of two turbine
generators and will run on imported coal to supply electricity, contributing
to ensuring national energy security, particularly in the southern region.
According
to Director General of the MoIT’s General Department of Energy Pham Manh
Thang, the first generator of the plant is expected to start commercial
production in the second quarter of 2021, and the entire plant in the second
quarter of the following year.
The
General Department pledged to provide guidance and work closely with the
investor to ensure the progress of the project, Thang added.
Song
Kok Cheong, CEO of Toyo-Ink, said with the support of the MoIT, the
corporation has worked with Vietnam Electricity (EVN), other related
agencies, localities and banks to run the project smoothly.
He
also committed to following the progress and ensuring the project’s quality
as set by the MoIT.
Addressing
the signing ceremony, Deputy Minister of Industry and Trade Le Duong Quang affirmed
that
To
meet the goal, the Vietnamese Government has issued policies and incentives
to encourage investors, both in and out of the country, to join in building
the core constructions under different cooperation forms, including the BOT
model, he said.
New
hospital fees to hit CPI
The
national consumer price index (CPI) in August may rise by 0.6 per cent above the
previous month when Ha Noi adjusts its hospital fees, the Domestic Market
Management Group, under the Ministry of Industry and Trade (MoIT), forecast
on Tuesday.
In
August, the commodity market will be affected by factors such as weather,
because the rainy season will affect the prices of food; an increase in the
forex rate; higher fuel prices in the world market; and costs for the new
school year.
The
oil and gas price hike on July 17 from VND420-470 (US$0.019-0.022) per litre
will contribute about 0.1-0.15 percent to the rise of the CPI in August over
July.
The
supply and demand in the market doesn't fluctuate much, so some products,
such as foodstuff, fertiliser and sugar, remain on a stable trend.
However,
as yesterday Ha Noi adjusted the fee of health care services, the CPI in
August may rise about 0.6-0.7 per cent, twice as much as the estimated
figure.
Earlier,
the General Statistical Office (GSO) announced the country's CPI for July
rose 0.27 per cent over June, marking it the strongest surge in the past five
months.
If
compared to last December, the CPI in July increased 2.68 per cent and is up
7.29 per cent from the same period last year.
Third
hike in gas prices
Gas
prices increased yesterday by VND667 ($0.03) per kilo or by VND8,000 ($0.38)
per 12-kg canister.
After
this latest increase, the current retail gas price stands at around
VND386,000 ($18.4) per 12-kg canister.
The
hike in domestic gas prices is due to higher prices on the global market,
said Do Trung Thanh, the head of the business department at Sai Gon Petro.
He
added that prices for deliveries in August in the global market have risen by
$27,5 per tonne to hit $820 per tonne.
This
is the third consecutive rise in gas prices since the beginning of June.—
Retail,
wholesale job listings soar 85%
Recruitment
website VietnamWorks, announces an incredible 85 per cent spike in job
listings in the retail and wholesale sector in its latest report.
This
is a key finding in VietnamWorks's second Online Employment Report for 2013,
as the spike in job listings is in stark contrast to the country's most
stagnant retail sales growth rate since 2004.
"While
the general word-around-town has retail truly suffering, this has not been
reflected in our data for the quarter where we saw job listings almost double
in the period," said Jonah Levey, founder and chairman of VietnamWorks.
"Overall
we saw a robust increase of 14 per cent in online employment demand in the
second quarter of 2013 compared to the same quarter last year," he said.
"As
Other
important findings in report show
Bac
Ninh also repeated a huge increase in online labour demand (53 per cent)
where several large investments saw a spike in demand, followed by
"The
government's new investment policies in
The
policies will also help attract foreign industrial and ICT giants, he added.
The
report said the best industries for job seekers are retail and wholesale (up
85 per cent), pharmaceutical and biotech (up 35 per cent), insurance (up 27
per cent), customer service (up 25 per cent) and consulting (up 24 per cent).
Meanwhile, oil and gas, banking, civil construction, architecture and
interior design, and human resources did not fare as well, reporting declines
of 23 per cent, 10 per cent, 4 per cent, 2 per cent and 2 per cent
respectively.
These
industries also fared poorly in the first quarter.
In a
similar finding to the Q1 study, customer service, accounting and finance,
production and process saw the biggest increase in number of applications,
whereas architecture, human resources and banking got the most notable
decrease in Q2 labor supply.
As the
banking sector is coping with economic difficulties by cutting staff, it has
not only witnessed a strong decline in job postings but also the biggest
decrease in job seekers, Levey said.
GAS says profit
discrepancy was mistake
The
PetroVietnam Gas Corporation (GAS) has said the VND800 billion (US$37.7
million) discrepancy in its financial reports from the first six months of
this year was due to false estimation.
In a
statement, the company said profit calculations were made on the 25th day of
June, before the end of the second quarter.
"By
that time, we could not collect all the cost and revenue figures for the
entire company to generate a precise estimate for the period".
The
early estimate was posted on GAS's website on July 18, showing the company
had earned a net half yearly profit of VND6.2 trillion ($292.4 million).
A week
later, a second report was sent to the HCM City Stock Exchange saying profits
had actually exceeded VND7 trillion ($330.1 million).
Analysts
say the company's explanation does not explain the significant discrepancy
between the two figures.
The
first report which indicated a second quarter profit of VND2 trillion ($94.3
million), declining 50 per cent from the first quarter, triggered a major
sell off in GAS shares. In the week before the correction, company stocks
dropped from VND65,500 ($3) to VND63,000.
GAS
closed yesterday's session at VND63,500 ($2.9) per share, up 0.8 per cent
from Tuesday.
Vinamilk
to set up subsidiary to rear cattle and poultry
The
Viet Nam Dairy Products Joint Stock Company (Vinamilk) announced on its
website a decision by its Board of Directors to co-operate with Thong Nhat
Thanh Hoa Co Ltd to establish Thong Nhat Thanh Hoa Cow Milk Co Ltd.
The
subsidiary will be set up in the fourth quarter of this year, with a charter
capital of VND600 billion (US$28.57 million), VND570 billion ($27.14 million)
of which will be invested by Vinamilk. The new business will focus on rearing
cattle and poultry.
Exports,
imports targeting
Bilateral
trade between
According
to the General Department of Viet Nam Customs, export earnings from Germany
reached $2.352 billion (up 22.35 per cent from 2012), accounting for 18 per
cent of Viet Nam's total export earnings from the European Union (EU).
Other
suspected countries and territories include mainland
In
A
representative from global trade atlas, GTIS, told Viet Nam News that the
value of the two imported transformers was over US$14 million in 2012. The
commissioner invited interested parties to lodge online submissions concerning
the dumping no later than September 9. Submissions can be lodged at
http://www.adcommission.gov.au.
The
number of outlets selling goods at stabilised prices in
This
year’s price stabilisation programme focuses on four groups of goods,
including essential foods and foodstuff, schooling materials, medicines and
dairy products.
At a
conference to review the efficiency of the programme on July 30, Deputy
Director of the municipal Department of Industry and Trade Le Ngoc Dao said
the firms joining in the programmes are working to ensure the supply of
quality goods for the market as assigned.
The
department has designed a logo to label price stabilised goods and will
publicise it in October to make it easier for customers when shopping, Dao
said.-
SBV
survey finds optimism among domestic banks
More
than 55 percent of commercial banks expect their business performance results
this year to outstrip last year, while 14.1 percent hold the opposite
opinion.
According
to the latest survey conducted by the State Bank of
As
much as 65 percent of banks predicted that their profits would increase this
year compared to 78.4 percent of last Decembers poll, which indicates that
banks are more cautious about predicting profit growth for this year after
the unexpected results in the first half of the year.
The
business performance results of most of banks in the first half of this year
left many disappointed. Only 30.4 percent of banks said that their
performance results had improved in H1 against 40.2 percent in the December
survey.
Nearly
50 percent of banks also reported that their pre-tax profit has fallen,
mostly between 20-30 percent, over the same period last year.
However,
banks are still optimistic about the future, saying that the business climate
is improving at last. Most banks forecast that both deposit and lending
interest rates will drop further over the next 3-6 months.
63.3
percent of banks expected a better business outlook in the second half and
only 3.8 percent were pessimistic about the economic climate in the latter
months of 2013.-
Chinese
machinery, equipment showcased in HCM City
Machinery
and equipment used in construction, packaging and food processing are on display
at the 14th Chinamac Fair 2013 in
Together
with the 2nd international exhibition on metalworking and welding technology,
the fair is co-hosted by the
As
many as 150 exhibitors from 11 countries and territories worldwide have come
to the events exhibiting their products and technologies. Machinery used in
paper production, garment and renewable energy are also available.
The
exhibitions are held annually to promote trade and industry in the region and
the world, and between
US$20
mil. cemetery opened in delta
Fairy
Park-Mekong Co. Ltd opened a cemetery named Son Trang Tien Canh with total
capital of US$20 million in the Mekong Delta
The
project, located along National Highway 61 in Thanh Hoa Commune, Phung Hiep
District, is aimed to meet the demand for grave preservation among residents
in the delta where graveyards are often flooded in the rainy season, said
Trinh Quoc Trung, general director of Fairy Park-Mekong.
This
is the second cemetery project of
Saigon
Water Corporation (Sawaco) on Tuesday struck a deal with U.S.-based Astro
Systems Group to renovate information technology and communications for the
city’s water supply system under a project costing US$650,000.
Under
the agreement, Astro Systems will support Sawaco to improve the system of
supervision and data collection on water distribution in districts. Besides,
the
The
project will be deployed in six months. Of its total cost of US$650,000, some
US$593,000 is provided by the U.S. Trade and Development Agency as
non-refundable capital and the balance from Sawaco.
Sawaco
is going to execute another environmental plan in which a sludge treatment
plant for the city’s water plants will be constructed with total investment
of US$50 million, Tran Dinh Phu, general director of the firm, told the Daily
on Tuesday.
Sawaco
has already borrowed US$18 million from the Belgian Government and has also
asked the Asian Development Bank for the remaining capital to have the
project getting off the ground early next year, Phu said.
Many
investors eye expressway project
Dau
Giay-Phan Thiet Expressway attracted the interest of many investors who
attended promotion events held in three Asian countries last week, said the management
board for public-private partnership (PPP) projects under the Ministry of
Transport.
A
presentation about this project was delivered to international investors in
Dau
Giay-Phan Thiet is the first expressway in
The
project will set an example of PPP mechanism development in
Bitexco
Group has been named the first investor of this expressway project and will
contribute 60% of the total capital. The second investor will be chosen via
bidding and will contribute the remaining 40%.
Dau
Giay-Phan Thiet Expressway, stretching a total of 98.7 kilometers, will have
six lanes and a vehicular speed of 120 kilometers per hour.
The
US$750-million project will help shorten the time for travel from HCMC to the
southern central region and tackle traffic congestion on
Industrial
inventories remain high despite strong export
The
industrial inventory index as of July 1 had risen 8.8% year-on-year although
foreign-invested enterprises (FIEs) had achieved impressive export growth.
The
inventory percentage of the processing-manufacturing sector stood at a high
level in the first half of the year, 75.4%, according to the General
Statistics Office (GSO). The index is identified by the division of the
month-end inventory by the average inventory of the month.
“The
normal level should be 65%,” said Pham Dinh Thuy, director of GSO’s
Industrial Statistics Department.
Some
items had a high inventory index, such as chemicals, pharmaceuticals and
food.
Industrial
production conditions were barely improving while consumption in the first
six months picked up 8.3% over the same period last year. Textile-garment
makers enjoyed an increase of 10.6% in consumption and manufacturers of
computers and electronic products recorded a rise of 9.7%.
Whereas
the industrial inventory index remains high and consumption has risen
insignificantly, FIEs have achieved considerable growth in exports of many
items.
Exports
of mobile phones and components in the first seven months of 2013 are
estimated at US$11.6 billion, a huge increase of 87% year-on-year. Computer
and component exports have brought in US$5.7 billion, up 40.4%.
Asked
if strong export of a number of items made by FIEs would help reduce the
industrial inventory index, Thuy said the effect would be minimal since FIEs
represented only 30% of the total industrial production value of the country.
FIEs
have a great impact on export growth but they do not affect the production
value much because most of them are simply assemblers and processors. While
their exports have risen strongly, imports have also gone up, leaving little
effect on domestic production, and unable to stimulate consumption and reduce
inventories, said the
Consumer
demand far from recovery
The
demand for fast-moving consumer goods (FMCG) has yet to recover, proven by
its low growth in this year’s second quarter, says a report released by the
market research firm Kantar Worldpanel.
The
FMCG sector’s value in cities in the second quarter did not increase compared
to the same period last year while that in rural areas rose around 11%,
according to the report.
Dairy
products and drinks still took the lead in the market segment while packed
foodstuff almost did not grow in rural areas and even plunged 3% in cities.
Groceries
still maintained strong growth while growth of other main shopping channels
has been on the wane, noted the report.
Notably,
mini supermarkets and convenience stores continued to grow strongly thanks to
a thorough knowledge of the convenience demand among urban residents as well
as a widespread expansion of new stores.
In
terms of drinks, Kantar Worldpanel experts recorded staggering growth of
wheat beverage products in cities and of mineral water in rural areas during
the second quarter. In urban areas, the product marked a growth rate of 31%
in sale volume over the year-ago period, which is ascribed to a rise of 19%
in the average consumption volume of every household.
Overall,
however, local consumer demand has still failed to improve as observed by
Kantar Worldpanel. Low-income people in urban and rural areas are the most
vulnerable ones who were even forced to cut down on FMCG spending in the
second quarter.
With
the current tough market conditions, an effective segmentation strategy
designed for different income groups will help producers grasp business
opportunities from the changes of local demand, said David Anjoubault,
general director of Kantar Worldpanel.
As low-
and middle-income earners will continue to shift to products with low prices,
it is extremely important to adjust the strategy accordingly to maintain this
segment’s growth. Meanwhile, consumers with higher incomes will continue to
be the pioneers in new consumer trends, especially those targeting health,
convenience and better high-class values, he remarked.
Gov’t
says no to demand stimulus
The
Government in a report delivered at a regular meeting on Tuesday stated the
macro-economy had been kept basically stable and inflation had been well
restrained in the first seven months of the year, but no demand stimulus
would be given.
Still,
Minister-Chairman of the Government Office Vu Duc Dam remarked economic
growth had been below its potential.
“The
Government is fully aware of the stagnant economy and an increasingly higher
risk of lagging behind if we do not succeed with the restructuring scheme,”
he said at the meeting on Tuesday.
As per
the Government report, the July consumer price index (CPI) picks up 2.68%
against end-2012, the lowest increase over the same period in 2004- 2011.
The
target for 7% inflation set by the National Assembly (NA) is attainable, Dam
said.
There
have been suggestions for demand stimulus, but the Government must take
prudence.
“The
Government has discussed and analyzed the opinions of experts at home and
abroad, and found that macroeconomic stabilization cannot be ignored,” he
said.
He
explained: “Normally, when demand stays low, there is a need for stimulus,
but without prudence, demand stimulus may fuel inflation.”
According
to the report, credit growth as of July 25 had reached 5.02%, versus 1.2% in
the same period last year, somewhat easing the pressure exerted by the credit
growth target of 12% for this year.
Interest
rates have gone down in line with inflation. Credit growth, reduced lending
rates and tax breaks have greatly helped businesses overcome their hardships.
Businesses
in the preferred sectors are offered a lending rate of 7-9% per year.
However, those active in other sectors are given a rate of 11-13% for
short-term loans and 13-17% for the long-term loans.
Though
many banks have eased lending conditions, credit flow into the economy
remains stagnant.
Speaking
at the meeting, Deputy Prime Minister Vu Van Ninh said he was anxious about
little progress in bad debt settlement.
Slow
bad debt resolution is the main reason why cash flow into production is poor
since banks are not keen on giving loans to corporate clients even though
they pledge assets.
Talking
to the media at the launch of Vietnam Asset Management Company (VAMC) last
Friday, Nguyen Huu Nghia, chief inspector of the central bank, said most
debts were mortgaged by real estate, which could hardly sell now. Therefore,
lenders are unable to collect debts and do not want to give out loans in the
traditional mortgage form any more.
If
businesses failed to use loans efficiently, banks would rather have low
credit growth and focus on debt recovery. For example, Vietcombank recorded a
negative credit growth rate of minus 1.1% in the first six months, but its
bad debt by end-June had declined to 2.7% from 3.22% in the first quarter.
Government
bond sales were also counted in credit growth. Although the average bond
yield keeps falling, the State Treasury by June 25 had sold VND120.5 trillion
worth of government bonds, meeting 61.8% of the year’s target.
HNX
transaction processing capacity boosted
The
Hanoi Stock Exchange (HNX) this Monday started operating the upgraded trading
system with a transaction processing capacity increased by 20 times.
This
trading system is capable of handling 20-30 million orders per session, or
15,000-20,000 orders per second, over 20 times greater than the capacity of
the old system, according to HNX.
The
implementation of this system marks a step forward in trading technology of
HNX and the stock market, a step closer to the global norm, providing the
stock market with better liquidity.
The
upgraded trading system is formed by integrating the trading systems for the
stock market, the market for unlisted companies (UPCoM) and other markets
expected to open in the future into a single trading platform. It facilitates
transaction management and operation and save resources when operating the
existing markets and those to emerge in the future.
The
new trading system enables diversification of products (stocks, fund
certificates and exchange-traded funds, etc.) as well as diversification of
trading orders. It also permits application of more advanced technology in
the future.
Together
with the trading system upgrade, HNX prolonged the closing time to 3 p.m.,
changed the structure of a trading session and introduced new types of
orders, including market-to-limit (MTL), market-fill-or-kill (MOK),
market-fill-and-kill (MAK) and at-the-closing (ATC) orders.
HNX
also set out rules for order edit and cancel. In addition to price
correction, investors are allowed to change the volume of orders, but they
cannot cancel orders in the last five minutes of a periodic order matching
session.
Moreover,
there are changes in reference price determination (reference price now
equals to the closing price of the previous day) and additional provisions
for odd-lot transactions (odd-lot transactions are done through continuous
order matching and negotiation).
Regarding
treasury shares, there are additional regulations on a maximum adjustment of
the daily volume of orders for trading of treasury shares from 5% to 10% of
the total registered volume in the documents businesses send to the State
Securities Commission.
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
|
Thứ Sáu, 2 tháng 8, 2013
Đăng ký:
Đăng Nhận xét (Atom)
Không có nhận xét nào:
Đăng nhận xét