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BUSINESS
IN BRIEF 9/3
Vietnamese
enterprises hold high expectation for 2014: VCCI
Vietnamese
enterprises hold high expectation for 2014, with confidence that the economy
will flourish, said the Vietnam Business Forum - a weekly magazine of the
Vietnam Chamber of Commerce and Industry (VCCI), adding that they are ready
for a new stage of development.
As a person in
charge of Vietnam Business Annual Report, Pham Thi Thu Hang, General
Secretary of VCCI, is not surprised at the bright results of the survey in
late 2013. After 7 annual reports, it seems that the businesses feel more
optimistic about the actual situation may seem. The difference is mainly more
or less optimistic, said Hang.
While 2013 saw a
record number of bankrupcies or shut-downs of enterprises, 2014 is expected
to see a record number of revived enterprises. This belief is built on the
basis of expectation that the sales this year will have great improvement
compared with 2013 and average selling prices will also tend to rise.
Nguyen Tuan Hai,
Chairman of Alphanam, after a period of "silence", has decided to
"churn" back on the market with the projects that he viewed as a
grasp of crowd psychology. Although he had not revealed his specific
investment areas, the move to recruit senior personnel from the retail groups
shows that he is looking to take advantage of rich land in big urban for a
breakthrough target in the distribution market.
But what is he
selling and distributing? He hinted that there will be Alphanam Food producing
food and distributing goods for the No. 1 brand in the world. Only time will
tell whether this investment in foods and beverages is a wise decision or
not, but clearly Hai is not the only one making big investment decisions at
this point of time.
Hang also indicated
a more optimistic view: many businesses are confident that the their
machines’ capacity will be much better than 2013. Many businesses after a
period of "hibernation”, start to accelerate restructuring and have more
confidence in the effective use of their resources. They expect that the
number of orders will increase compared with 2013. A lot of businesses are
confident with their plan to recruit more in 2014.
Nguyen Thi Nguyet
Huong, Chairwoman of the Vietnam Investment Development Group (VID), a firm
specialising in the development of industrial parks, export processing zones,
is confident that 2014 will see more businesses expanding their activities,
so her group plans to expand the industrial parks.
Naturally, businesses
which want to develop cannot be separated from the macro- economic
environment. VCCI 's survey showed that businesses which decide to expand
their business scale for many reasons.
In particular, the
reason of favourable economic outlook and availability of skilled labour with
high competitive costs is chosen by many businesses, this ratio is 42.9
percent and 40.1 percent, respectively.
Businesses hold
high expectations on changes in the labour market because this is the easiest
time for businesses to recruit those who can immediately meet job
requirements without being retrained, even for key positions. The second
reason is the opening of markets, tax incentives and improved ability to
raise capital. The third is improved infrastructure and support programmes.
Referring to the
contents of the strategy of the socio-economic development period 2011 -
2020, the majority of businesses (64.6 percent) are aware that the increase
in domestic value, added value and competitiveness of products are important
objectives in strategy.
The rate of added
value on price of one product of respondent enterprises is estimated at an
average of 19.5 percent. This index ranged as low as 0.05 percent and as high
as 85 percent. Notably, there were 77.5 percent of the surveyed enterprises
considered this a key issue and among these businesses, the solution to
improve the competitiveness of products is the most common (up to 74.3
percent enterprise applying the solution).
So far,
Lan is happy to
find that enterprises are now changing their mind, they do not just sit and
wait for the state to support. They have changed the way of thinking and
business strategies to survive and thrive instead of just stopping at the
surface reforms.
Despite high
expectation for the economic performance in 2014, there are still
difficulties that enterprises need to be ready to cope with. Nguyen Dinh
Cung, Director of the Central Institute for Economic Management (CIEM), in a
debate on amendments to the Law on Enterprises emphasized that more than
ever, businesses need to get the positive support from institutional reforms
to create a stable macroeconomic platform for "micro levels" to
develop.-
Driving
force for
The central city of
The decision, which
was made by the municipal People’s Council at its year-end meeting in 2013,
has received consideration from the business circle operating in the city.
They expect 2014 will be a better year as the city will issue more policies
to help enterprises maintain and develop production and business and offer
stable jobs.
Nguyen Duc Tri,
General Director of the Hoa Tho Garment Joint Stock Company, said that the
decision shows the city’s consideration to the business circle.
It will help
enterprises in their business restructuring as well as put forth solutions to
remove their difficulties, thus contributing to the city’s development, he
added.
The city should
strengthen administrative procedure renovation and seek ways to improve its
competitiveness index, said Phan Hai, Deputy Head of the Da Nang Young
Entrepreneurs’ Association.
Meanwhile, Lam
Quang Minh, Director of the Da Nang Investment Promotion Centre, suggested
more favourable conditions for investors, such as incentives, infrastructure
facilities, land, service and financial-banking support.
The 2014
Entrepreneurship Year is expected to create a momentum for the city’s
business and production activities, contributing to making
Da Lat
vegetable growers face profit losses
After the Lunar New
Year of the Horse 2014, many vegetables grown in Da Lat city, Lam Dong
province and neighbouring areas (branded Da Lat vegetables) dropped in price
significantly, said the Communist Party of Vietnam(CPV) online newspaper on
March 5.
It is time to
harvest some vegetable gardens but traders offered to buy at very low price
which is not enough to cover the cost of renting labour for the harvest,
leaving farmers unable to sell their products, according to CPV online
newspaper.
Actually, this is
not the first time growers of Da Lat vegetables have had to leave their
products in the field. The situation of bumper crops resulting in low prices,
and seeing high prices only after poor crops has happened many times in the
greatest vegetable growing area in the country.
The main reason is
the poor linkage between production and consumption networks, and poor market
information.
Da Lat is the
largest and high-quality vegetable production area in the country. With the
favourable condition of climate and altitude, farmers have experience and
access to high technology, so vegetable production in Da Lat is a model for
farmers in other areas.
Da Lat annually
plants over 50,000 ha of vegetables, of which 12,000 ha is applied high
technology.
Productivity,
output and prices of vegetables produced by high technology is increasing.
Revenue of high-grade vegetables is over 400 million VND/ha/year, 1.6 times
higher than the average rate of the province. The trademark of Da Lat
vegetables has been certified and appears throughout the country and in some
foreign markets.
However,
consumption markets for Da Lat vegetable have been precarious for years.
Among about 1.7 million tonnes of vegetables produced annually, 13,000 tonnes
are exported. The rest is consumed locally, and it is mainly sold to traders
in wholesale markets.
Farmers sell kinds
of vegetables they have, while traders only buy sort of vegetables which
bring them high profits, if not they force farmers to sell at low price or
leave farmers flat. Moreover, farmers usually rush to grow high price
vegetables at the previous season but not know that the selling price could
be changed at the next crop.
Although the Da Lat
vegetable market is gloomy, production and consumption of vegetables of many
households, collectives and businesses are still stable, such as Da Lat Gap
Co., Ltd, Xuan Huong collective, and Anh Dao collective.
In these units,
farmers produced vegetables with quantity and types ordered by supermarkets
so they don’t worry about seasonal price dips. Furthermore, the distributors
are active in their source of supply to ensure quality and standards.
This shows that for
agricultural production activities, especially fresh products such as
vegetables, market research and consumption network organisation are urgently
needed. However this is not easy for farmers, and it should be supported by
the State.
Indeed, over the
past time, Lam Dong province had many activities to support farmers such as
approving vegetable production area planning until 2020 for sustainable and
effective development, associating production with processing and consumption
of products.
In addition to
infrastructure investment, promotion of scientific and technological
application to improve the quality of fruits and vegetables, the province
also pays attention to attracting investors in purchasing and processing
products; building links between households, cooperatives, and businesses in
the supply of agricultural materials and consumption of products;
strengthening trade promotion, market development, building transaction
floors for vegetables, fruits and flowers to create favourable conditions for
businesses to participate in trading.
The Vietnam Cashew
Association (Vinacas) targets to export around US$2.2 billion worth of cashew
products this year.
According to
Vinacas at a meeting last Wednesday, to obtain the cashew export of US$2.2
billion, with some US$1.8 billion of cashew nut exports, Vietnam has to
import around 650,000 tons of crude cashew from Africa and Cambodia.
The cashew volume
of the 2014 crop is estimated at 350,000 tons, which can meet only 35% of the
domestic processing demand.
Exports of cashew
nut totaled 264,000 tons worth US$1.66 billion, up over 19% and nearly 13%
respectively. Meanwhile, the total export value rose to nearly US$1.9 billion
inclusive of cashew oil and deep-processed cashew products.
Vinacas forecasts
that the global demand of cashew nut will rise. However, exporting
enterprises will have to face trade barriers in many countries like the amended
Food Safety Modernization Act (FSMA) of the U.S. Food and Drug
Administration.
The
Falling
buying power pushes up sugar inventory
The sugar inventory
volume of factories recorded on February 15 amounted to nearly 420,000 tons,
or 80,720 tons higher than last year’s same period, while the volume sold
between January 15 and February 15 was 163,210 tons, down 8,920 tons year-on-year,
according to the Vietnam Sugar Association.
Explaining the
increasing sugar inventory in the year’s first two months, the head of a
sugar firm said that domestic sugar was facing harsh competition with sugar
smuggled from
Besides, after a
period of boosting production of Tet confectioneries, firms have lowered the
sugar use, affecting the buying power of sugar, he added.
According to sugar
firms, with the current price of over VND12,000 a kilo, sugar factories
suffer losses of over VND1,000 for every kilo they sell. Despite incurring
losses, firms cannot lower the price of sugarcane they buy from farmers.
Sugarcane is now
bought at VND930,000 per ton, equivalent to last year. Meanwhile, a kilo of
sugar was priced at VND14,000 at this time last year.
According to
updated statistics of the Ministry of Agriculture and Rural Development, the
sugar price continues to drop by VND500-1,000 per kilo from last month. The
current wholesale price of white sugar at Nong Cong, Son La, Nghe An, Quang
Ngai, Ben Tre and Con Tho factories ranges between VND12,000 and VND12,600 a
kilo.
Statistics recorded
on February 15 showed that sugar factories had produced 835,000 tons, up
50,500 tons year-on-year.
Housing
price falls, office occupancy rises in city
The housing price
in HCMC continued the downward trend in the fourth quarter last year while
office developers enjoyed a slight rise in occupancy, according to a report
of Savills
Savills
Key factors that
helped attract homebuyers included the reputation of the investors in keeping
their promise on carrying out projects on time, and financial support from
banks who assure borrowers with stable lending rates, the report said.
In the coming
quarters, the housing trading volume is expected to continue rising and the
housing price index will become stable, it said.
Also in its report,
Savills said office rents have almost stood still since the third quarter of
last year. However, the occupancy has risen.
During the fourth
quarter of last year, 18,000 square meters of office area was occupied, a 58%
fall compared to the previous quarter but a rise of more than 35% over the
same period of 2012.
Savills
The office price
index is expected to slightly increase in the first half of this year and
strongly rise in the second half. By next year, the office market will have
recovered.
Thanh Da
condo buildings to be demolished soon
Residents in two
Thanh Da condo buildings No. 4 and 6 in Binh Thanh District will be urgently
relocated and the crumpling structures will be demolished soon, authorities
said after a meeting on the issue on Monday.
“We are working
with the municipal Department of Construction to determine the final
solution, which will be announced right in this month (on the relocation),”
said Duong Hong Thang, vice chairman of Binh Thanh District, after a meeting
with HCMC leaders on Monday.
A well-informed
source said the HCMC government has agreed to buy all 1,050 condos from a
project currently under progress in Ward 12 not far from Thanh Da. These
condos, which will be handed over to the city government this June and
September block by block, will be sold or leased to those people who are to
be relocated from Thanh Da condo buildings.
Late last year,
HCMC Vice Chairman Nguyen Huu Tin assigned Binh Thanh District authorities to
prepare a project to relocate people from the two above-mentioned Thanh Da
condo buildings and to develop a new complex on the premises.
Under the city
government’s decision, Binh Thanh authorities will select a
financially-capable investor to develop new condo buildings on the premises
of the two Thanh Da condo buildings and other nearby buildings.
The city government
has also approved a proposal by the municipal Department of Construction to
cancel a project earlier awarded to Vuon Xanh Real Estate Co. to develop an
apartment complex on the premises of Thanh Da building covering 7.73
hectares.
Regarding the
policy for residents in the old Thanh Da condo buildings, the compensation
will be made with new condos, either at the new apartment complex in Ward 12
or other condos available under the district government.
Residents will not
have to pay extra sums if the new condos are the same in sizes with the old
ones. If the new condos are bigger, they will have to pay the difference at
the market price.
The new apartment
complex project in Ward 12, which started construction in late 2009, covers
nearly 28 hectares bordered by Chu Van An and Nguyen Xi streets. The
facilities there include condo buildings up to 20 stories high with 1,050
apartments of 60 to 90 square meters, a park and green areas covering over
8.1 hectares, a kindergarten, a primary school, a clinic and other public
facilities.
The payment scheme,
starting from this month, allows potential homebuyers to be able to own a
home with a 50% down payment while the remaining amount will be paid over two
years with no interest.
The company says
this “move in with 50% payment” program follows the success of a similar
campaign at The Estella in HCMC’s District 2.
Situated along the
40-meter wide Ca Cam River south of HCMC, Riviera Point is developed in
phrases with a total of 2,400 units spread across 12 residential towers. When
completed, the construction will be the tallest development in District 7.
Doan Anh Hung,
general manager of
Topped up in last
year’s December, the first phrase includes three residential towers comprising
some 540 apartments, with the selling price starting from VND31 million per
square meter. The first phrase is planned for completion in 2015.
“
He said
TMV obtains
high auto part export
Toyota Motor
Vietnam (TMV) on March 3 announced its business results of last year with car
and components exports hitting a record high after 18 years of operation.
TMV’s export of
auto parts exceeded US$39.2 million last year, which is the highest to be
recorded by TMV after over nine years since its auto part export center went
into operation. This helped raise the total export turnover of auto parts in
nine years to US$246 million.
Major exporting
products of TMV include antenna and exhaust valve that have been shipped to
13 countries and territories, including Thailand, Indonesia, the Philippines,
Malaysia, India, Argentina, South Africa, Venezuela, Pakistan, Taiwan,
Brazil, Egypt and Kazakhstan.
Last year TMV achieved
a record export volume with over 31,000 units. Besides, it set a record of
auto sales with 33,288 units, inclusive of completely built-up ones, up 34%
from 2012 and holding a market share of 34.4% in
Yoshihisa Maruta,
general director of TMV, said that this year TMV planned to introduce new car
products with many improvements and offer a series of activities for
customers.
Sacombank
funds tourist building construction
Saigon Thuong Tin
Commercial Bank, or Sacombank, signed a credit contract with private
enterprise Son Thinh last week to fund construction of Son Thinh tourist
service building in
Sacombank will lend
the enterprise VND350 billion in 60 months with an interest rate of 13% per
annum. This is part of the bank’s scheme to give assistance to real estate
enterprises.
The project
includes a commercial center, two basements and 400 condos with the total
investment of over VND780 billion. The flats are from 100 to 160 square
meters each and priced from VND19-25 million each square meter.
Sacombank will also
give financial supports to homebuyers of the project with loans up to 70% of
the condo value.
Phan Dinh Tue,
deputy general director of Sacombank, said in a statement released last week
that the bank launched three preferential housing credit packages for
individual customers in 2013 with the total value of VND3.2 trillion. Earlier
this year, the bank made VND1 trillion more worth of loans available for
homebuyers.
Farmers
earn big bucks from growing grass for cows
Farmers contracted
by the Vietnam Dairy Products Joint Stock Company (Vinamilk) to grow grass
and corn as feed for dairy cows are earning over VND100 million per hectare,
and a senior executive of the dairy company.
Vuong Ngoc Long,
technical director of Vinamilk, said the company last year signed contracts
with farmers to grow grass and corn on more than 1,200 hectares. However, the
amount supplied by domestic farms meets only 50% of feed for the company’s
dairy herd, while the other half including hay and soybean is imported from
the
The average price
contracted with local farmers is VND1,000 per kilo of corn stalks and
VND500-600 per kilo of grass, Long added. Farmers can earn around VND60
million per crop, which enables a profit of up to VND100 million a hectare
each year.
Such benefits have
encouraged many local households in Thanh Hoa, Nghe An, Lam Dong, and Binh
Dinh provinces to switch their farms from sugarcane into grass and corn for
Vinamilk. Recently, the company has invested on about 3,500 hectares for
farming cattle feed.
This year and next,
Vinamilk will develop four more dairy farms with 36,000 head in Tay Ninh and
Thanh Hoa provinces, raising the company’s total herd to 46,000 cows in nine
farms. Still, such a herd can supply only 40% of the company’s dairy
processing demand.
“Due to a lack of
farming areas for fresh feed in
A shipment of 2,000
pregnant dairy cows arrived in
Saigon Co.op, owner
of the Co.opmart supermarket chain, targets to open 10 supermarkets and
commercial centers and 20 food stores while reaching total revenue of VND25
trillion this year.
Speaking at a
review meeting in HCMC on Wednesday, a Saigon Co.op leader said that two more
Sense City commercial centers will be launched into operation in the Mekong
Delta this year with the combined capital of VND500 billion, taking to three
the total number of Sense City centers in the region.
Saigon Co.op will
also open eight Co.opmart supermarkets in HCMC,
In addition, the
retailer has plans to launch 20 more Co.op Food stores in HCMC, taking the
total number to over 90.
Saigon Co.op will
expand cooperation to compete against foreign retailers that have made deep
investment in the domestic market.
To meet target
revenue of VND25 trillion and growth rate of 14%, Saigon Co.op will focus on
restructuring, logistics improvement and manpower management.
For international
cooperation, Saigon Co.op and
It has also
cooperated with Mapletree to develop SC VivoCity shopping mall in District 7
with total investment of US$100 million. The project is expected for opening
in 2015.
Last year, Saigon
Co.op obtained VND22 trillion in revenue, up 13% against 2012.
Sacombank
yet to find strategic partners
Sacombank has
recently announced it will increase foreign room to 30% against the current
level of 10% as it has yet to find strategic investors that can hold a 20%
stake in the lender.
In May, 2013,
Sacombank closed foreign ownership limit (FOL) ratio at 10% instead of 30% as
regulated in prevailing laws. The bank set aside the 20% stake for foreign
strategic partners after ANZ Bank walked away.
Sacombank Chairman
Pham Huu Phu told the Daily that the bank has yet to find any strategic
investors after negotiating with many foreign banks, including a number from
Difficulties of
Sacombank and the entire banking system have obstructed its negotiation
process. Some foreign organizations have given gloomy forecasts about the
local banking network, so Vietnamese banks have been at a disadvantage during
negotiations with foreign partners.
In addition, many
investors are expecting an FOL hike in banks.
“They wish to hold
up to 49% in banks for better management, not just 20% like now,” Phu said.
Therefore, it is
high time to increase foreign room to raise liquidity of shares and give a
boost to share prices, he added.
Sacombank is also
seeking approval to turn its branch in
In 2013, the bank
reported credit growth of 14.8% with total outstanding loans of over VND110
trillion. Sacombank will organize its annual general meeting on March 25.
Foreign,
joint-venture banks post strong growth
Foreign and
joint-venture banks have for the first time taken the lead in assets growth,
which is put at 26.9% in the year to the end of 2013, according to statistics
of the central bank.
Meanwhile, total
assets of State-owned commercial banks picked up a slight 13.7%, and those of
commercial joint-stock banks rose 14.8%. Finance and finance leasing firms
were still in distress as their assets plunged 57.7% during the period.
Industry sources
said they were surprised at the assets growth of State-owned and joint stock
commercial banks. As 2013 was a tough year with credit remaining sluggish and
bad debt staying high, such assets growth rates enjoyed by local banks was
impressive.
A bank’s total
assets do not reflect the true nature of its growth but their growth figures
raised questions.
The return on asset
(ROA) and return on equity (ROE) of the banking sector was 0.49% and 5.18% by
late 2013 respectively, both lower than in late 2012. This suggested the
health of local banks deteriorated last year.
The local banking
system reported total assets of over VND5,700 trillion as of end-2013, rising
over 13% against late 2012. Its total equity surged nearly 10% to around
VND467 trillion, of which State-owned banks reported a jump of 21.3% due to
strong mobilization while joint stocks banks gained growth of just 6.5%.
Total chartered
capital of the banking system was nearly VND424 trillion, up 8.1% against
late 2012. The loan-to-deposit ratio was 84.7% while the capital adequacy
ratio (CAR) was 13.2%.
Dragon
Capital’s bond funds merged
Fund manager Dragon
Capital has merged VDeF-A and VDeF-B under the Vietnam Debt Fund SPC (VDeF),
forming a general portfolio to improve investment and risk management.
The merged fund now
has total asset of US$38.5 million. Converting all bonds in the VDeF-A into
the VDeF-B was approved at Dragon Capital’s shareholder meeting in
Established in
2007, VDeF is an open-ended Cayman Island-registered fund that seeks
sustainable profits in the local debt market. It has been listed on the
The VDeF-A fund
concentrates on government debts and debts of State-owned enterprises.
Meanwhile, the VDeF-B has a broader investment strategy with corporate bonds
included.
VDeF has made
strong growth over the past three years with VDeF-A and VDeF-B rising 9.25%
and 10.36% respectively. With the results, the two funds took the lead in the
Emerging Market Corporate Debt report announced by the analytical service
provider Camradata recently.
Banks awash
with spare capital as demand stays low, SBV says
Local banks have
seen liquidity soaring up due to weak consumption, falling consumer price
index (CPI), sluggish trading after the traditional Lunar New Year holiday,
or Tet, and low capital demand, according to the State Bank of Vietnam (SBV).
Speaking at a news
briefing last week, SBV reported that credit of the banking system as of
February 20 dropped 1.66% against late 2013. In recent years, credit has
always seen low growth or even declined in the early months of year.
Credit in dong
declined 1.94% while foreign-currency credit rose 0.11%.
The forex market
and exchange rate saw stable developments in the first two months of this
year. The central bank continued to buy foreign currencies to supplement
foreign reserves.
As of February 26,
banks’ exchange rates had been stable, fluctuating between VND21,080 and
VND21,120 to the U.S. dollar.
Earlier, speaking
at the Government’s regular meeting, SBV Governor Nguyen Van Binh said that
the central bank bought over US$4 billion to spur foreign reserve in the
first two months.
As banks have been
sitting on huge capital, SBV has not given refinancing loans to lenders over
the past time, Binh said.
Explaining
redundant capital at banks, Binh said the State Treasury is still depositing
over VND57 trillion at credit institutions. The central bank wants to speed
up disbursement and has requested the Government and related ministries to
boost bond issue in the first quarter of 2014.
Mobilization rates
have dropped back after Tet, with those of tenors from one to two months
dropping by 0.3 to 0.5 percentage point. Lending rates have also been
stabilized.
Doan Thai Son,
deputy head of legislation under the central bank, said that SBV is still
supervising restructuring plans of nine weak banks. Aside from eight banks
that have presented their restructuring schemes, the remaining bank has also
submitted its plan with participation of foreign investors.
As foreign
ownership limit is still low, the Government will consider restructuring
projects on a case-to-case basis. If the plans are not approved, credit institutions
will have to undergo more drastic measures.
Meanwhile, Nguyen
Quoc Hung, vice chairman of Vietnam Asset Management Company (VAMC), said
that VAMC has bought VND39 trillion worth of bad debts from banks versus its
2013 target of VND30 trillion. The enterprise has issued VND31 trillion worth
of special bonds.
Some banks have
sought approval from the central bank to provide them with refinancing loans
basing on value of the special bonds issued by VAMC. However, no banks have
obtained capital via this channel so far.
VAMC is appraising
VND7 trillion worth of debts and has plans to buy around VND10 trillion in
the first quarter.
Banks cut
interest rates to boost sluggish lending
Local banks have
slightly lowered lending rates to step up sluggish demand for loans following
a reduction of deposit rates.
Speaking at a
business matching session between companies and banks last Thursday, Nguyen
Van Binh, governor of the central bank, said he would call for banks to
further cut lending rates.
Interest rates for
depositors last year dropped to below 7% per annum for tenors of less than
six months, so it is tough for the central bank to go for another rate cut as
inflation control remains a priority this year. However, banks should find
ways to lower lending rates to buoy consumption given the low consumer price
index (CPI) in the first two months this year.
“This is an
opportunity for banks to cut lending rates by 0.5 percentage point. The
central bank has lowered the lending rate for the VND30-trillion home loan
program to around 5% a year, so banks should follow suit to support
enterprises and citizens,” Binh said.
Short-term lending
rates offered within the bank-business connectivity program hovered at around
9% in late 2013. Banks should reduce short-term lending rates to 7-8% while
maintaining medium and long-term rates at around 10%, compared to the 10-12%
range last year. Binh said that if it was done, lower rates would benefit
corporate borrowers and the economy as a whole.
The central bank
has also proposed the Government support the agricultural and rural sector,
especially enterprises applying high technology. In recent times, the central
bank has given assistance to TH True Milk Company and An Giang Plant
Protection Company.
In fact, the
current lending rates offered by banks are lower than those before Tet
holiday.
Pham Linh, deputy
general director of Orient Commercial Bank (OCB), said OCB reduced lending
rates by 0.5 percentage point after Tet. At present, the bank’s short-term
lending rates range from 9.5% to 11% and medium to long-term rates from 11%
to 12%.
Phan Huy Khang,
general director of Sacombank, said the bank’s medium to long-term rates are
11-12% and short-term rates 9-10%.
During the meeting,
four banks in HCMC – Sacombank, Agribank, VietinBank and Vietcombank – signed
credit contracts to lend over VND800 billion to 11 corporate clients. The
interest rates range from 6 to 8.5% for short-term loans and 9-11% for medium
to long-term loans.
Last year, the city
government organized 28 business matching sessions between banks and
businesses, with over VND13.7 trillion loans lent to 654 enterprises,
family-run businesses and cooperatives. VND12.3 trillion of this amount has been
disbursed.
Nguyen Hoang Minh,
deputy director of the central bank’s HCMC branch, said banks would continue
lending this year, with priority going to high-tech firms. Local banks expect
to lend VND156 trillion this year.
Admin
procedures for businesses to be handled faster
The technical
system connecting ministries participating in the first phase of the national
one-stop service mechanism was officially launched last week in
The Ministry of
Finance, the Ministry of Industry and Trade, and the Ministry of Transport
will perform procedures via the one-stop service mechanism, also called
single-window system, including e-customs declaration form, clearance
decision, goods clearance, notice of ship arrivals and departures, departure
permit, and transit permit. The mechanism will also include registration to
import ozone-depleting substances, application to import industrial
explosives, application to have
Deputy Prime
Minister Vu Van Ninh said that the technical connection with the three
ministries was an important beginning for ministries and agencies to conduct
administrative procedures on the national one-stop service system
sufficiently and comprehensively. This is also a good preparation for
deploying the following phases before conducting international connection, he
added.
The event
demonstrates the Government’s commitment to ASEAN countries when ratifying
the agreement on implementing the national single window mechanism and the
ASEAN single window mechanism as well as shows commitments of ministries on
innovation to support businesses.
Ninh requested
ministries, agencies and localities to promote administrative reform and
simplify procedures while still ensuring the State management and legitimate
interests of businesses and the people.
Duties and tasks of
ministries and agencies involving in the implementation of the single window
mechanism should be defined. Besides, the implementation should be reviewed
after a period of time before being expanded in accordance with the road map
set by the Government and the national steering committee.
The ASEAN single
window mechanism and the national single window mechanism are regarded as the
first and important step of ASEAN member countries in reforming and
simplifying administrative procedures concerning export-import activities to
meet the integration and development demands of each country as well as to
boost connection and cooperation among the countries.
The test use of the
national single window mechanism started under Decision 48/2011/QD-TTg of the
Prime Minister on August 31, 2011.
The project to
build Quang Trung 2 Software City will be presented to the HCMC government
this June, said deputy director of Quang Trung Software City (QTSC) Nguyen
Hai Long.
The project aims to
attract investments of local and foreign enterprises in outsourcing,
researching and developing information technology (IT) products and
solutions.
“We have finished
making the detailed planning and will present it to the city government in
June,” Long said.
According to Long,
three locations where the project can be developed are being considered.
QTSC is also
working with Lam Dong and Nam Dinh provinces on small-sized software parks.
Besides, QTSC is coordinating with
Total revenues
earned by IT enterprises in QTSC were estimated at VND2.865 trillion last
year, up 35.5% from 2012. Last year’s export value rose by 39.7% to US$70.85
million.
QTSC attracted 21
IT enterprises last year, raising the total number of enterprises operating
in QTSC to 108.
Private,
FDI sectors boost city’s budget revenue
The budget revenue
of HCMC amounted to VND23.9 trillion in the first two months of 2014, with
revenues collected from domestic private enterprises and foreign-invested
enterprises accounting for 53.4%, said the city’s Department of Finance.
The department
noted that revenues from the business community surged 21% year-on-year,
indicating economic recovery. Of the total revenue, centrally-governed
State-owned enterprises contributed VND3.11 trillion and local State-owned
enterprises some VND2.31 trillion, but over VND6 trillion and VND6.76
trillion came from the domestic private sector and FDI enterprises
respectively.
The department said
at a meeting on the January-February socioeconomic situation last week that
most of the target for budget collection has been achieved. The 21% rise in
tax payment from enterprises has indicated a sharp recovery in enterprises’
operations.
However, investment
in the city’s economy this year to date has shown contrasting developments,
said Thai Van Re, director of the city’s Department of Planning and
Investment. Re said that foreign investment is rising while domestic investment
decreased.
In the two-month
period, the domestic investment has declined 14% with only VND131.6 trillion
of fresh investment registered while the city’s FDI rose 226% year-on-year to
nearly US$217 million.
Re said that export
value of the city totaled US$4.1 billion in two months, down 2.5%
year-on-year. In January, the city’s export value reached almost US$2.4
billion, dropping 10.3% year-on-year.
A fall in export
value is due to the lower export volumes of many kinds of core export
products including coffee, computer, electrical products and components,
shoes and clothing.
IP tenants
fret about relocation
Enterprises at Bien
Hoa 1 Industrial Park in
Most tenants in the
IP have objected to the plan, citing huge damages to the production, while
the park owner Sonadezi has reiterated its plan to develop a commercial-urban
complex on the premises of the IM now.
Nguyen Thi Kim
Vinh, deputy general director of Dien Quang Lamp Joint Stock Company, told
the Daily that the company had two workshops at Bien Hoa 1 IP with 500
workers. If the workshops are moved to Giang Dien Industrial Park as
suggested, the distance from there to the company’s main office in HCMC as
well as its other factories is longer, not to mention costs for new
workshops, she added.
According to Vinh,
what is more concerning is the loss of laborers. Workers of Dien Quang are
experienced and well-trained but most of them may not work for the company
any more if the workshops are relocated. Meanwhile, if Dien Quang operates
shutter buses, production costs will be pushed up, making it hard for the
company to compete with cheap imported products.
For others, the
relocation would mean a waste of existing facilities.
Bien Hoa Steel
Joint Stock Company (Vicasa) has recently spent VND40 billion on an emission
treatment system. If Vicasa moves its factory from Bien Hoa 1 to
According to Le Van
Cam, general director of Vicasa, the company has hired 26 hectares at Nhon
Trach for its relocation plan.
However,
Vicasa earned only
VND500 million in profits last year. Due to the steel oversupply, its factory
runs at a capacity of 120,000 tons per year compared to the designed capacity
of 180,000 tons.
Vicasa forecasts to
lose over 140 among some 490 skilled local laborers if the relocation is
enforced.
“The company will
comply with the province’s relocation plan but enterprises need supporting
policies,”
A survey of
Sonadezi, investor of Bien Hoa 1 Industrial Park, shows that only 15% of the
enterprises operating at this industrial park agree to move while 44% do not
want to.
Many enterprises
say they are anxious when moving to Giang Dien or other industrial parks,
which are 20-60 kilometers away. They also worry over moving and installing
equipment and machines, and having no products for customers or losing the
market when conducting the relocation.
Speaking to the
Daily, a leader of Sonadezi said that Sonadezi would start to change the
functions of Bien Hoa 1 Industrial Park into an urban-service-commercial area
in the middle of this year with an initial investment estimated at some
VND14.65 trillion.
Sonadezi is currently
seeking opinions of ministries and agencies about tax and credit policies for
relocated enterprises, solutions regarding capital sources, and land for
their relocation.
Bien Hoa 1
Industrial Park established in 1963 covers an area of 324 hectares and currently
has 104 enterprises with over 26,000 laborers.
Each day
sees 100 cars imported into Vietnam
This month’s auto
imports are estimated to amount to 3,000 units, or 100 units a day,
equivalent to that in January but up by around 2,000 units from a year ago,
according to the General Statistics Office.
The import value is
down to US$48 million this month from US$65 million recorded in January.
Around 6,000
completely built-up cars have been imported into the country in the first two
months with a total value of some US$113 million, up 39.8% in volume and
26.1% in value.
Auto traders expect
a possible pickup in business this year as the city government has lowered
the automobile registration fee for under-ten-seat vehicles to 10% from the
previous 15%.
The auto market has
been warming up since the tax on completely built-up cars imported from
The
Auto imports last
year reached nearly 34,500 units worth US$709 million, up 25.9% and 15.2%
respectively.
Daklak to
register Buon Me Thuot trademark in China
After winning the
Buon Me Thuot trademark back from an enterprise in
Daklak has asked
for a financial support of VND100 million from the Vietnam Coffee and Cocoa
Association (Vicofa) to pursue the process of registration for geographical
indications of Buon Me Thuot across China, the EU and some other important
markets, said Nguyen Viet Vinh, general secretary of Vicofa. Buon Me Thuot is
the capital city of the province.
Vinh said about
five Vietnamese coffee trademarks will join an upcoming trade promotion
program in
Meanwhile, the EU
has been supporting
On Sunday, Vicofa
got the official judgment from China’s Industry-Trade Ministry on cancelling
the trademark of Buon Me Thuot Coffee registered by a Chinese firm named
Guangzhou Buon Me Thuot Coffee Co. in this market.
That Chinese
ministry’s judgment was given on the basis that Buon Me Thuot is a famous
place in
In addition,
Guangzhou Buon Me Thuot Coffee Co. did not lodge any appeal to a higher court
in
CJ,
Sumitomo cooperate in flour production
The venture called
CJ-SC Global Milling LLC commenced work on the wheat flour factory at My Xuan
B1-Tien Hung Industrial Zone in Ba Ria-Vung Tau Province on Thursday.
The US$44 million
facility will be equipped with CJ Cheil Jedang’s production technologies. It
is expected to be up and running in May 2015 and its markets will be
CJ Group already
has a Tous Les Jours bakery chain in
Nearly
US$70 million for refinery maintenance
Dung Quat Oil
Refinery will stop operation from May until early July for routine
maintenance at a total cost of nearly US$70 million, said Nguyen Hoang Yen,
head of science and technology at Vietnam Oil and Gas Group (PVN).
This is the second
routine maintenance since the refinery started operation in February, 2009,
Yen told the Daily on Monday. The maintenance this time costs much more than
the first one in July, 2011, which was at around US$40 million.
According to Yen,
routine maintenance is performed every three years. Contractors participating
in maintenance are from
With this
maintenance, the refinery’s annual production volume will be reduced by
around one million tons.
Dung Quat Oil
Refinery having a production capacity of 6.5 million tons per year is
operated by Binh Son Refining and Petrochemical Co., Ltd.
According to PVN,
Binh Son earned VND2.806 trillion in after-tax profit last year and has paid
over VND26 trillion to the State budget.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Bảy, 8 tháng 3, 2014
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