BUSINESS IN BRIEF 2/9 Vital road project on hold after investor exits The Ministry of Transport is looking for new investors for the Hoa Lac-Hoa Binh expressway after important capital partner Hanoi Export Import JSC (Geleximco) withdrew from the project. The expressway is a highly important connector between Hanoi and localities to the Northwest. The project was licenced to Geleximco in 2010. In the recent past Geleximco has appealed to the prime minister to withdraw from the project and hand it over to the Ministry of Trade (MoT) or localities along the expressway’s route (Hoa Binh province and Hanoi). Geleximco based its appeal on the basis that it felt it could not sufficiently recoup its investment after the highway’s construction was complete. Part of the project agreement was that the Hoa Binh Provincial People’s Committee awarded land to Geleximco to build the Yen Quang and Trung Minh new urban areas and the 36-hole Trung Minh golf course. A similar deal was struck with Hanoi which granted 600 hectares for the Lang-Hoa Lac new urban area. The developer figured the total investment to be around $857 million, up $362 million against the initial proposal. “Although this is a very important project, it is impossible for us to go through with it within the timeline and given the falling property market,” said Geleximco general director Vu Van Tien. According to the a source from the MoT, thus far, the developer has only invested around $17 million into the project, three years after first breaking ground. The MoT also asked that Hoa Binh Provincial People’s Committee assist Geleximco in recovering their initial investment. To keep the project moving after Geleximco’s exit, the MoT is looking to Hoa Binh and Hanoi authorities to help in accessing capital and is considering different investment models, including the public private partnership model (PPP). The MoT’s Project Management Unit 2 (PMU 2) was assigned by the MoT to promote the project. “One possible investor is the Asian Development Bank, which is considering this and other projects for the upcoming October appraisal round,” said PMU 2 general director Nguyen Ngoc Long. HCM City to host Int’l Exhibition on Advanced Technology Products VietnamPackPrint, VietnamFoodtech, VietnamPrintlabel, and Linkage Vietnam 2013 will be held at the Saigon Exhibition and Convention Center in District 7 in Ho Chi Minh City from September 3-6. The International Exhibition on plastics, rubber, packaging, printing, food technologies and automation attracts 260 enterprises from 16 countries, including China, Germany, Hong Kong (China), India, Indonesia, Italy, Japan, South Korea, Malaysia, Russia, Singapore, Taiwan (China), Thailand, and the U.S. The companies showcase a comprehensive range of industrial products, technologies, and services, such as moulding machines, electronic weaving machines, bottle blow moulding machines, packaging machines, food processing machines, numerous printing machines and various rolls. Linkage Vietnam focuses on industrial automation, metalworking, as well as electric engineering and the energy industry. The event is a place where visitors can meet the whole industry and businesses have a chance to introduce their products and latest technologies, and also seek partners. In addition, seminars featuring on specific topics will be held during the exhibition for industrial improvement and exchange of expertise. Binh Duong approves US$200 million investments Binh Duong Province on Tuesday awarded business certificates to 25 new and operational projects of local and foreign investors with total pledged capital of more than US$200 million, with Japanese firms contributing half. Twelve Japanese-invested projects worth over US$100 million were licensed this time, said Le Thanh Cung, chairman of Binh Duong. Most of them are involved in supporting industries like electronics and automobile components, he noted. Tomoku Vietnam Co. Ltd., a subsidiary of Japan’s Tomoku Company, obtained the certificate to construct a carton-paper factory at a total cost of US$47.6 million at My Phuoc 3 Industrial Park in Ben Cat District as the biggest scheme among those licensed. Takashi Nara, general director of Tomoku Vietnam, said the plant to be built on a total area of 60,000 square meters will run at a maximum capacity of five million square meters of packaging paper per month for domestic sale. The plant, set for operation in October, 2014, will supply Japanese enterprises active in Vietnam, Nara said. Tomoku, Nanshin Seiki Vietnam, Washin Aluminum Vietnam and Nagashima Vietnam became newcomers from Japan in Binh Duong on Tuesday. Eight other certificates went to Japanese investors injecting more capital into their operational projects in the province. For instance, GS Battery Vietnam Co. Ltd. will be spending an extra US$8 million to raise its capacity of auto and motorbike batteries. The approved projects also include a US$21.4 million plant of U.S.-based Amway making and processing consumer goods such as functional foods at Vietnam-Singapore II Industrial Park or VSIP II. Amway decided to build the second factory in Vietnam besides its operational plant in Dong Nai Province in a bid to meet local rising demand after seeing its nutrition, cosmetics and household hygiene items posting steady sales growth since its entry to the country in 2008, said How Kam Chiong, general director of Amway Vietnam. Binh Duong has so far this year attracted 88 fresh foreign direct investment projects and 88 others adding capital with total pledges of some US$1 billion, reaching the year’s target of the province, Cung said. He promised to continue improving the local investment environment to facilitate operations of foreign investors in the province. Gmobile still fraught with difficulties Young Gmobile is struggling to compete with its much larger competitors after brand owner GTel Mobile converted into a wholly-owned enterprise. In April 2012, GTel Mobile, a joint venture between Global Telecommunication Corporation and Russian leading mobile phone operator VimpelCom, bought 49 per cent stake of the Russian partner for $45 million, turning the joint venture in a wholly state-owned business. For around a year now the new brand was still struggling, despite the company’s total assets of $238 million. In the last year, Gmobile took significant steps to bolster operational efficiency. Unfortunately, these efforts only yielded modest returns. One such example was Gmobile’s roaming deal with VinaPhone which allowed subscribers of the former to use the latter’s network in areas outside Gmobile cell coverage. This deal, however, failed to meet the company’s expectations. Under the agreement, Gmobile paid VinaPhone VND450 per minute for all of their subscribers who used the VinaPhone frequency. While this was only about a third of the standard charge per minute for calls, when the company included promotion and other costs, they found they lost money on these callers. Apart from the deal with VinaPhone, Gmobile worked hard to expand their network, but with little effect. Currently, Gmobile has only around three million subscribers, with an ambitious goal of six million by the end of 2013. A major reason behind the company’s poor performance and its roaming deal with VinaPhone was its limited frequency resources. “Gmobile is limited to the 1,800 MHz waveband, while the larger networks have all the 900 MHz, 1,800 MHz, and 3G. This is a tremendous disadvantage for us,” said Gmobile general director Nguyen Van Du. He added that the company was proposing the Vietnamese government for a more balanced distribution of wavebands. When asked about the rumour that Gmobile would merge with state group VNPT’s VinaPhone or MobiFone, Du said that because of their state-owned capacity, the decision to do so would be above their heads. VNPT also refused to comment on any possible merger. Microsoft Vietnam opens “new digital work style” office in Ho Chi Minh City Microsoft Vietnam today officially unveiled new office of Ho Chi Minh branch, located at 93 Nguyen Du, District 1, Ho Chi Minh City. Attending the ceremony were Cesar Cernuda, president of Microsoft in Asia Pacific, Vu Minh Tri, general director of Microsoft Vietnam, Le Thai Hy, director of Information Communications Department of Ho Chi Minh City, Le Hoai Quoc, member of Ho Chi Minh City People's Committee, head of Saigon Hi-Tech Park, Chu Tien Dung, director of Quang Trung Software Park, Microsoft partners and Microsoft employees. With a “new digital work style”, this new workplace marks a milestone on Microsoft’s creative and dynamic working model which is really different from popular traditional office environment in the past. Unlike “traditional office environment” where employees work at defined workplace and strict working hours can often impact negatively on personal productivity, Microsoft Vietnam brings a “new digital work style” into workspace of Ho Chi Minh branch office. With communication and collaboration tools and methods that are specifically designed, this modern office enables its staffs to not only get the job done, but also improve their productivity and creation in work. Modern technology is constantly evolving and its achievement will show the great impact on the enterprise environment at the first. Nowadays, employees want to work almost anywhere, at any time by using a PC, headset, webcam or smartphone, but require the synchronisation, continuousity and uninterruption for all. New developments in technology currently allow them to be virtually ‘present’ through instant messaging services or in meetings through video conferencing capabilities or webcams. At this new office, Microsoft Vietnam’s staffs no longer need to be in the same room to participate effectively, they can create a virtual meeting room to join meetings with leaders, colleagues at anywhere via Microsoft’s advanced technology equipments. With open architecture style, modern interior and cozy design, the new office in Ho Chi Minh City enables an absolute ‘work-life balance’. At a new workplace that equipped with advanced technology solutions and create a standard environment to respond to the current challenges, inspires passion, creativity and innovation, Microsoft Vietnam’s staff can absolutely work flexibly with high productivity. The new office in Ho Chi Minh city shows the worldwide IT leader’s change in management approach from control to trust, and from presence to output. “Normally, businesses that adopt a flexible working policy and trust their employees to do their best work in the environment they choose, whether that is inside or outside of the office, will boost employees satisfaction. As the result, they can get the better achievement in work with higher productivity. Microsoft always has trust in employees, and we are pursuing an unique working style that differentiate from most of others – we encourage our employees to work from home or outside the office,” Cesar Cernuda, president of Microsoft Asia Pacific said at the new office opening ceremony event in Ho Chi Minh City. “The event of new office opening ceremony in Ho Chi Minh today marks another significant milestone of Microsoft Vietnam to deploy a top-ranking modern working model to all employees here and I hope that our staffs will really enjoy their works every day at a great workplace like this.” “Microsoft’s ambition is to create a workplace where our staffs can contribute their ideas for a same passion – Creating technologies that will change the world. With the open design and modern, the new workplace can fully satisfy sharp and challenged requirement of supporting Microsoft customers and partners as well as create an ideal working environment for both leaders and employees of Microsoft Vietnam. It is also the place that we are absolutely proud to share our unique working style with our customers and partners. At our new workplace, after witnessing the latest technologies that support our staffs for a better creativity and productivity, enterprises can apply them in their own business to transform their performance and improve the efficiency in their management and operation system,” said Vu Minh Tri, Microsoft Vietnam’s general director. With new modern work style, the new office in Ho Chi Minh City will create friendly working environment for both leaders and employees of Microsoft Vietnam and fully support their works to achieve most effectiveness and highest productivity. Findings from Microsoft offices around the globe that apply this flexible working model shows 23 per cent increase in collaboration and 13 per cent increase in privacy and concentration, that result the improvement of productivity and team collaboration. Not only being the world leading IT company but Microsoft also be awarded as the “Great place to work” - taken the top spot -for the year 2009, 2010, 2011 and 2012 not only in Europe but also the global by the Great Place to Work Institute. Farm produce exports slightly decline Export value of the nation’s primary industries is expected at US$2.39 billion in August, taking to US$17.98 billion the total export revenue of the agriculture sector in the January-August period, down 1.1% against the same period of 2012. Key agricultural products such as rice, coffee and rubber continued to see export revenue falling despite increases in export volumes. However, the seafood sector saw signs of recovery and the woodworking industry continued to post steady growth. Rice, coffee and rubber, which have generated large export revenue and caused huge impacts on rural lives and farmer incomes, saw export revenue dropping during the period. Rice exports were expected at nearly 4.7 million tons worth US$2 billion, down 15.7% and 18.4% year-on-year respectively. Rice export prices kept falling, averaging out at US$438.5 per ton in the January-July period, a 3.2% year-on-year decline. China remained the biggest importer of Vietnamese rice with total volume of 1.47 million tons worth US$609 million, or 32.8% of total export revenue. Compared to the same period of 2012, export volume and value to China increased 9.6% and 6.8% respectively. Meanwhile, coffee export prices slightly increased, averaging out at US$2,142 per ton in the first seven months, a 1% increase. However, coffee export revenue declined 22.5% to over US$2 billion because export volume dropped 23.2% to 974,000 tons in the first eight months. Rubber export volume January-August rose 4.6% to 638,000 tons but export revenue dropped 14% to over US$1.5 billion. Average rubber export price in the first seven months was US$2,387 per ton, down 18% year-on-year. Woodworking products export value posted a steady rise with its value reaching US$3.34 billion January-August, an 11.6% year-on-year increase. Exports to large markets rose strongly, of which the U.S. was up 7.2%, China 14.7%, Japan 20.3% and South Korea 48.2% year-on-year. Meanwhile, the seafood industry slightly recovered with export revenue hitting US$4 billion in the first eight months, a 1.3% rise. The U.S. remained the biggest seafood importer of Vietnam, accounting for 20.9% of total seafood export value. HCM City’s sales promotion month attracts 900 firms This year’s sales promotion month beginning early September in HCMC has attracted a total of 900 local companies with many discount programs on offer and more selling points to reach out to consumers. The HCMC Department of Industry and Trade as a co-organizer of the program said the number of enterprises joining this year’s sales promotion posts a rise of over 10% year-on-year. Many companies participating in the program are offering strong discounts for buyers. For example, Thien Hoa Interior Furniture and Electronics Center offers discounts of up to 49%. Under the month-long sales promotion, the industry and trade department this year holds 12 marketplace sessions at dormitories and industrial parks and 200 mobile selling points in remote areas and outlying districts so that workers, students and low-income people can get promotional items more easily. The sales promotion will kick off with a fair to be opened at the Phu Tho Indoor Stadium in District 11 from this Friday to next Tuesday featuring more than 400 stalls to supply foodstuff, garment, household appliances and consumer goods. The event has been organized annually under arrangement of the industry department and the culture, tourism and sports department since 2004 in a bid to stimulate demand and lure local and foreign visitors to the city. Sumitomo invests in Tiki.vn Tiki Corporation (Tiki.vn) on Tuesday signed a strategic partnership with Japan’s Sumitomo Corporation and became the first e-commerce company in Vietnam to receive investment from this Japanese company. Under the partnership, Sumitomo will hold a 30% stake in Tiki.vn to become the second strategic investor of the latter, following an investment by the Japanese investment fund CyberAgent Ventures into Tiki.vn last year. According to Tiki.vn, after this deal CyberAgent Ventures will hold a stake of only 15%, down from 22%. With an investment of Sumitomo, Tiki.vn will improve the service quality in terms of expanding the delivery network and providing new products of different sectors. “E-commerce is still new in Vietnam, and thus the issue of human resources is always a headache of most enterprises. With our long-term development strategy, we will give special focus on attracting talent as well as providing training on specialized knowledge of e-commerce for employees,” said Tran Ngoc Thai Son, general director of Tiki.vn. Founded in March 2010, Tiki.vn runs an e-commerce website selling over 40,000 products of five groups - book, electronics, appliances, fashion and stationery. After three years of operation, Tiki.vn has reached customers in all of 63 provinces and cities nationwide and in 17 countries. According to Son, Tiki.vn will increase the number of products to 100,000 next year, many of which will bear Japanese brands with assistance from Sumitomo. Besides, Sumitomo will start selling cosmetics and appliances on Tiki.vn next year. Vinasun to issue three million new shares Vinasun, a HCMC-based taxi firm, on Tuesday announced to issue an additional three million shares to raise funds for a plan to expand services to more cities such as Nha Trang, Can Tho and Hanoi. The enterprise, at an extraordinary general meeting in HCMC on Tuesday, said the share sale would be carried out via private placement for large shareholders. It also approved a business development strategy and a chartered capital increase plan in coming years. Through the issuance, the taxi operator will raise capital to add more vehicles in the areas where it is operational such as HCMC, Binh Duong, Vung Tau, Dong Nai and Danang and buy some to serve new places like Nha Trang, Can Tho and Hanoi. The enterprise will buy 400 new cars this year, excluding the earlier scheduled 500 cars, and 900 more in 2014. In the first six months of 2013, Vinasun obtained over VND1.5 trillion in revenue and VND98 billion in after-tax profit, meeting 53% and 55% of this year’s respective targets. By the end of last year, the firm had had more than 4,600 taxi cabs with a work force of around 13,500. Singapore’s imports from Vietnam continues increasing According to International Enterprise (IE) Singapore, Singapore’s cumulative imports from Vietnam in the first seven months of this year reached almost 1.8 billion SGD (1.4 billion USD), an increase of 15.7 percent over the same period last year. Among the key imports from Vietnam, electrical machinery and sound recorders made the highest value of 627.8 million SGD; followed by machinery appliances (nearly 217 million SGD) and glass and glassware (162.6 million SGD). The IE Singapore also reports that Singapore’s cumulative exports to Vietnam in seven months were valued at nearly 7.8 billion SGD, equivalent to that of the corresponding period last year. Domestic exports to Vietnam almost reached 3.54 billion SGD and re-exports, 4.3 billion SGD. Of Singapore’s exports to Vietnam, electrical machinery recorded the highest value (nearly 2.2 billion SGD) and also the biggest increase over the same period last year (118 percent). Topping Singapore’s domestic exports to Vietnam in the first seven months was mineral fuel oils, waxes and products (over 1.35 billion SGD); followed by printed books, newspapers and products of printing industry (about 395 million SGD) and electrical machinery (about 386 million SGD). Two-way trade between Vietnam and Singapore in 2012 was recorded at 15.8 billion SGD, of which imports from Vietnam valued at 2.8 billion SGD and exports to Vietnam, 12.9 billion SGD.- Happy Valley to launch third phase Phu My Hung Corp. will roll out the eagerly anticipated Happy Valley’s Stage 3 condominiums onto the market this mid-September. Located in the middle of Phu My Hung City Center in Ho Chi Minh City’s Saigon South, Happy Valley is situated near a golf course, river, the International Commercial and Financial Centre, and Crescent District, which is home to the Star Light Bridge, Crescent Lake and Crescent Mall. Happy Valley is just next door to the 5.4 hectare Saigon Wonderland. Happy Valley’s phases 1 and 2 have 511 apartments in all and 84 per cent of them have been sold. Happy Valley sold well in the first and second phases thanks to its reasonable prices and long-term payments. For the third phase, Happy Valley will first offer 192 condominiums in the K and M blocks with a park and river view. Block K looks over the river and golf course while block M is opposite to Saigon Wonderland Park. The third phase’s sales gallery is already open for the general public. The third phase’s apartments are available in two sizes, 99 square metres and 134sqm. The larger sized apartment can be customised to produce a garden-like entrance or extended living room. The whole 3.4-hectare Happy Valley offers an idyllic combination of architecture and landscaping. Located on Nguyen Van Linh Parkway, Happy Valley includes 818 apartments and 23 retail outlets. Each flat include parking for one car and two motorcycles. There are also additional parking areas for visitors. Buying Happy Valley condominiums, customers may arrange their financial plans more easily because of the long-term payment schedule. Besides, Phu My Hung also sells completed condos that customers can move in immediately such as Riverside Residence, Canh Vien 3 and Sky Garden. Government IT sees vast improvement Vietnam has made important strides towards full government use of technology in the last three years, according to reports at a seminar on e-government development in Hanoi on August 28. Reports from the International Data Group (IDG) presented at the 11th Vietnam E-Government Symposium show that all 22 ministries and ministerial-level agencies have their own e-portals, as do cities and provinces across the nation. The conference reviewed three-year implementation of the National Programme for Information Technology Applications in State agencies during the 2011-2015 period and the overall public administration reform programme during the 2011-2020 period. Meanwhile, 95% of ministries and ministerial-level agencies and 98% of provincial People's Committees use document management software. According to IDG, the satisfaction of citizens and businesses is one of the most important measures in calculating e-Government development level. As a result, the focus of e-Government development has been shifted from ensuring the management and administration of Government agencies to serving the society. Accordingly, efforts continue to be made to enhance the application of modern technologies to improving the operational quality of government agencies, setting up a comprehensive and transparent date infrastructure, and improving public services to engage with citizens and businesses. Entitled ‘Developing E-Government: Driving Collaboration, Transparency and Citizen Engagement’, the annual event aims to discuss development models, share experiences in the field and bring technology solutions to bear on e-Government development and administrative reform in Vietnam. This year’s event is expected to help the public administration sector boost the application of modern IT to improving the quality of public services and to better serve the society in the future. SSC signs stock market development deal The Sate Securities Commission (SSC) and financial company Maybank Kim Eng Holdings on Wednesday agreed to a deal on providing technical assistance to develop the stock market. Under the agreement, the SSC and the company will concentrate on collaboration in sectors of interest to both sides for the purpose of boosting the sustainable growth of the Vietnamese stock market. Maybank Kim Eng will support the SSC in consulting on the establishment of legal documents. In addition, both sides will together organise conferences and workshops, conduct training courses and operational checks, and develop new securities products. The SSC chairman, Vu Bang, said: "We and the stock exchanges have been working with many international agencies and large financial corporations. We welcome the co-operation of Maybank Kim Eng in sharing its experience in building the market and expanding linkages with the region to lead foreign investment into Viet Nam." The company's general director Tengku Dato Zafrul stated that this agreement was important to the development of the Vietnamese stock market, especially when it was integrating more comprehensively into the world. With more than 50 years operating in the global financial market, Maybank Kim Eng is expected to help the SSC fulfill its legal framework consistent with international standards. Commodity exchanges debated The Ministry of Industry and Trade on Wednesday held a conference to discuss setting up a legal framework for transactions by Vietnamese businesses through foreign commodity exchanges. According to Deputy Minister Ho Thi Kim Thoa, transactions through commodity exchanges have a long history in the world, helping prevent risks for trade companies, especially those importing and exporting agricultural products, fuels and metals. The legal framework is necessary for enterprises to deeply integrate into the world market, avoid trade risks, raise competitiveness and penetrate new markets, Thoa said. According to Tran Thanh Hai, Deputy Director of the Import-Export Department, currently the circular would be applied to Vietnamese businesses joining commodity transactions via foreign commodity exchanges. Experts at the conference said that the transactions through foreign commodity exchanges must be tightened, then adjusted to ensure compatibility to the capacity and demand of enterprises. Also, accountability of enterprises joining the exchanges must be detailed, while State management needs to be enhanced to prevent speculation and trade frauds which can damage the market or the enterprises' benefits. Mekong meeting promotes region's eco-system A strategy meeting for the Lower Mekong Initiative's TIGERS@Mekong project was held in HCM City yesterday. The project is a public-private alliance platform aimed at strengthening the start-up and innovation eco-systems in targeted Mekong economies by supporting young innovators and entrepreneurs in the technology sector. The meeting, held by the US Department of State and the technology media, event and research company IDG ASEAN, brought together 50 key government and technology sector stakeholders. The participants discussed for a strategy and planning on creating an effective enabling environment for technology entrepreneurs in the Lower Mekong sub-region. The meeting allowed government officials from Cambodia, Laos, Myanmar, Thailand, and Viet Nam to assess their nations' entrepreneurial eco-systems and the private sector to share insights into developing their components. The participants considered the unique needs of specific groups like women and young entrepreneurs, and identified priorities for future TIGERS@Mekong activities. TIGERS@Mekong will leverage US expertise in fostering entrepreneurship and deploy strategic partnerships between US and Mekong private sectors to strengthen the region's start-up and innovation ecosystems, promote and facilitate connectivity in the region, and foster innovative business models. "In recognition of the Mekong region's potential as a source of innovation and in an effort to boost competitiveness and growth in the region, the US Department of State launched the Mekong Technology Innovation Generation and Entrepreneurship Resources (TIGERS@Mekong) as a signature project under the Connect Mekong framework at the East Asia Summit in 2012," the US Department of State Special Representative for Global Partnerships, Andrew O'Brien, told the meeting. "TIGERS@Mekong is about many, many things, but at its core it is about connecting people and putting like-minded people on the same path to prosperity . The nature of diplomacy has changed very much in recent years - and the greatest thing we can do as allies today is to get on - and stay on - a path towards a shared economic future." A senior official from Foreign Affairs Ministry Nguyen Van Thao said: "The robust globalisation and development of the knowledge-based economy are posing challenges to Mekong countries, and among these are, first and foremost, gaps in knowledge and technology." Viet Nam therefore supports the launch of TIGERS@Mekong and would closely co-ordinate with LMI member countries to implement TIGERS@Mekong and Connect Mekong to make best use of the US's advantages for supporting Mekong countries in integration and bridging the development gap, he said. The project should support the connectivity and development of technology businesses, particularly small and medium-sized enterprises, in knowledge intensive and high value-added industries through inspiring innovation and developing high-quality workforces in Mekong countries, he said. "In an effort to mobilise resources from business sector, we do expect TIGERS@Mekong to serve as a platform for US and Mekong enterprises to involve in public-private partnership projects, particularly those in technology infrastructure connectivity and research- knowledge exchange." With a population of around 90 million people, half of them under 30, Viet Nam is endowed with not only a young and abundant workforce that is dynamic, diligent and capable of absorbing technology, but also a market of great potential, he said. The accelerated industrialisation and modernisation process of the country are opening up new investment opportunities in areas where the US has an edge — like infrastructure, technology, renewable energy, and environment – he said. VN woodwork exports impress Viet Nam is ranked sixth among the world's largest woodwork exporters, according to the Commercial and Industrial Information Centre under the Ministry of Industry and Trade. The country is also the second biggest woodwork exporter in the Asian region and the South East Asia leader, the centre reported. The domestic industry is expecting a 10 per cent surge this year with an income of US$5.5 billion. The industry last year earned $4.67 billion from exports. The Ministry of Agriculture and Rural Development reported woodwork export value in August reached $432 million, bringing the total earning in the first eight months of this year to more than $3.34 billion, up 11.6 per cent year-on-year. During the period, exports of Vietnamese woodwork products to most large markets surged significantly. South Korea saw the highest growth with 48.2 per cent while increases were also recorded in Japan, China and the US. The US remained the largest importer of Vietnamese woodwork products, spending more than $1 billion, up 7.24 per cent. The market accounted for 36.7 per cent of Viet Nam's total woodwork export earnings. The export value of wood products to the US is estimated to reach $1.7 billion for the entire year. China and Japan followed with $491.3 million and $441 million. South Korea, the United Kingdom, Canada, Germany and Australia were other large importers of Vietnamese wooden furniture. However, exports of the staple to Germany and France declined by 14.4 and 2.2 per cent respectively. Dang Quoc Hung, deputy chairman of the Handicraft and Wood Industry Association of HCM City said that the sector expected exports of wood products to rise further in the second half of this year, with Chinese demand surging due to competitive pricing. He said that China will import $800 million of woodchips from Viet Nam this year. Footwear exporters urged to make more of opportunities Vietnamese leather and footwear exporters must become more competitive to capitalise on a shift in demand from China to Viet Nam, advised experts from the Ministry of Industry and Trade. They were addressing recent increases in orders made with Vietnamese producers from countries such as Japan, amid negotiations for the Trans Pacific Partnership (TPP). The ministry experts said foreign importers were shifting orders of leather and footwear products from China to Viet Nam, urging Vietnamese companies to improve their competitiveness on the global market. Viet Nam is finalising its participation in the Trans-Pacific Partnership (TPP) and is negotiating free trade agreements with countries in the European Union to attract further investment to the leather and footwear industry. Ho Thi Kim Thoa, Deputy Minister of Industry and Trade, said Viet Nam will aim to bring modern technology and prominent brands to the domestic industry. The Viet Nam Leather and Footwear Association (LEFASO) said importers of prominent leather and footwear products on the world market were planning to shift their orders from China to Viet Nam to capitalise on cost and labour advantages. The association added that Vietnamese leather and footwear exporters were aware of the opportunities as orders shifted to Viet Nam. However, Dang Van Chien, Director of the Hung Yen Footwear Joint Stock Company, said the trend was merely a ‘signal' and that foreign importers had only visited Viet Nam to conduct market research. Many enterprises have said challenges still remain in attracting foreign orders to the sector, adding that high taxes, production costs and limited capacity needed to be addressed first. Currently, 80 per cent of footwear exporters in Viet Nam are engaged in partial production of footwear products with limited capacity to deliver key aspects of end-to-end production, including design. Domestic producers were also said to suffer from poor management and inadequate investment in new technologies. Chien said that this made it difficult for enterprises to predict trends and demand in foreign markets. He urged the Government to support training programmes that would improve the quality of the labour force and attract more foreign partners. Diep Thanh Kiet, LEFASO's Deputy Chairman, said enterprises should review their market strategies, improve their competitive advantages and build regions specialising in the production of raw materials. In the first seven months this year, Viet Nam's export value of footwear jumped 15.6 per cent from last year to US$4.79 billion. 500kV Vinh Tan - Song May power line begins trial run The Electricity of Vietnam's National Power Transmission Corporation (EVNNPT) successfully moved the 500kV Vinh Tan - Song May power line into its trial run phase on August 28. The 236-kilometre power line runs through Binh Thuan and Dong Nai provinces. Nearly VND2,990 billion (US$140.5 million) has been invested so far. During the first trial run, the line transfers electricity to the Vinh Tan 2 Thermoelectric Power Plant, which is scheduled to become operational by the end of this year. The second trial run is expected to begin in October. The line is one of several urgent projects that contribute to providing electricity to southern provinces during the dry season. It also connects the Vinh Tan Thermal Power Centre in Binh Thuan and other major power sources in the south central region to the national grid. Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR