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BUSINESS
IN BRIEF JULY 17
Minister
visits firms hit by anti-China riots
Minister of
Planning and Investment Bui Quang Vinh yesterday visited foreign companies
affected during the anti-China riots in mid-May in
He was accompanied
by local leaders to the Viet Nam-Singapore Industrial Park in Thuan An
township.
Le Thanh Cung,
chairman of the Binh Duong People's Committee, told Vinh that the province
had acted on the Government's instructions and provided compensation and
support to firms that suffered losses.
It has so far
announced recompense worth VND286 billion (US$13.6 million) for 37
enterprises and support policies in a first phase.
The amount would be
deducted from land rental, cost of services, income and import taxes, and
others, and procedures are being completed to compensate the remaining
companies and would be announced next month, he said.
Thanks to the
prompt assistance, the affected firms have resumed operations, he said.
Vinh praised the
prompt action and also approved a proposal related to paying salaries to
workers for May 12-25 when many factories remained closed.
Kent Teh, general
director of Hongkong-owned Esquel Corporation, which produces T-shirts at the
Viet Nam-Singapore Industrial Park and has been in
Production returned
to normal a week later, he said, adding that last month 100 more workers had
been hired to meet orders.
South Korean-owned
Sewoon Medical Vina yesterday began production at the Viet Nam-Singapore
Industrial Park.
The $7 million
project was disbursed for constructing the factory for producing medical
equipment one year since after investment license was granted.
Cung said the
province encourages investment in projects using advanced technologies and in
the knowledge sector and supporting industries and those that are
environmentally friendly.
Binh Duong was the
top province in terms of foreign direct investment in the first half,
attracting over $1 billion.
This is expected to
rise sharply in the second half.
Brighter
economic outlook accelerates car sales in H1
Low interest rates
and a brighter economic outlook in
This allayed
worries of a market slowdown and set the industry up for a strong second
half.
Sales in the first
six months of 2014 rose 27 per cent over the same period last year to 54,986
units, according to the Viet Nam Automobile Manufacturers Association (VAMA).
Of the figure, cars
were up 36 per cent and trucks up 24 per cent.
The association,
which comprises country's 21 leading auto makers, said in its monthly report
yesterday that this was the 15th consecutive month that sales had been
higher.
VAMA's chairman
Jesus Arias said with this momentum, the full year total industry forecast
for 2014 was adjusted up to 130,000 units, a 18 per cent growth from 2013.
Nguyen Van Dung,
general director of Northern Automobile Corporation, a prominent auto dealer
in
"We've seen
good improvement in manufacturing activity. Consumer sentiment has been good,
and incomes are gaining ground." he added.
Viet Nam's economy
has been stable for the first half of the year with a GDP growth rate of 5.18
per cent and inflation at 1.38 per cent against December last year – the
lowest rise in the past 13 years.
In addition, the
latest forecast from the World Bank shows that
The company, based
in the central province of Quang
Meanwhile, the
country imported 25,000 completely built units (CBU) cars worth US$500
million in the first half, an increase of 44.4 per cent in volume and 53.9
per cent in value year-on-year. About 25 per cent of the imports were luxury
sedans and sports utility vehicles (SUV), according to the Customs Office.
HOSE sees
busy year for securities trading
HCM City Stock
Exchange expects securities trading to thrive till this year-end, riding on
initial public offerings by State-owned enterprises and the operation of the
first domestic exchange-traded fund.
According to Tran
Anh Dao, the bourse's
The first domestic
exchange-traded fund ( VietFund Management VN30 ETF) , which recently
received the licence for its IPO, would also help boost the market liquidity,
she said.
The bourse
statistics showed that the total market capitalisation on the southern bourse
reached (US$46.9 billion) as of the end of the second quarter, 2.2 per cent
lower than the end of the first quarter, but up 21 per cent over the end of
last year.
Notably, the second
quarter saw foreign investment in the HCM Stock Exchange increase from not
only the first quarter but also last year's same period.
Between April and
June they bought securities worth more than VND16.3 trillion (US$777.6
million) and sold VND11.2 trillion worth for net purchases of VND5.1
trillion.
This compared to
VND15.9 trillion and nearly VND15 trillion in the first quarter, and 10.8
trillion and VND11 trillion a year earlier.
Their trading
represented 22 per cent of the transactions on the exchange.
SSI, HSC, and ACBS
were the top brokerages, accounting for 13.22, 13.13, and 6.23 per cent of
the market.
According to
VietstockFinance, with expectations of a recovery in the realty market,
stocks of property sectors were the most heavily traded on the southern
bourse in the first half of the year. FLC Group (FLC), Tan Tao Group (ITA)
and Hoang Quan Corporation (HQC) were the top three with respectively 8.4
million shares, 8.1 million shares and 4.1 million shares averagely traded
per session.
Investors
lack clear regulations
The lack of clear
and specific regulations on incentives offered for agricultural investment is
the biggest stumbling block for foreign investors hoping to enter the
industry.
Managing director
of major US-based investment consultant BowerGroupAsia Inc, Nguyen Viet Ha,
was quoted by Dau tu (Investment Review) as saying that the number of US
investors in the Vietnamese agricultural sector is now negligible, though
many
Currently, only
animal feed maker Cargill and Monsanto are operating in
Ha believed that
policy impediments stopped investors from entering the market.
Foreign
agricultural projects have theoretically got big incentives like exemptions
or reductions in corporate income tax, import taxes, land rental and many
other priorities, but there are no clear and specific regulations on how to
apply these incentives. Most of these regulations are still on paper.
Though land
incentives have been prescribed for foreign agricultural projects, many
projects with regard to planting of forests and sugarcane have only found
small areas of land compared with big areas licensed in their investment
certificates, she said.
Credit policies for
foreign agricultural projects have also become impractical because there is a
belief that foreign investors do not need the credit support; or due to
complicated and unclear procedures. Previously,
Others who came
here were Dantzler, Dragonberry Produce, Intervision Foods and John Deere
along with Novick Industries, PTC International, TRC Trading Corporation, and
Experts hoped that
the Trans-Pacific Partnership would open a new opportunity not only for
agricultural exports and imports between
However, they said,
a lot depends on specific regulations that
Forex rate
tumbles after State Bank announcement
The US dollar prices
in commercial banks fell sharply yesterday after the State Bank of
Accordingly, most
of the commercial banks rated down their prices of the US dollar. The buying
price of the dollar fell by VND70 and the selling price by VND90 in the local
market.
In the morning
session, the commercial banks of Vietcombank, BIDV and VietinBank ACB listed
their dollar buying rate at VND21,160 and VND 21,185, and the selling rate
between VND21,250 and VND21,230.
On the same day,
SBV kept the US dollar's exchange rate at VND21,246, unchanged from its new
rate since June 19. The central bank also set the ceiling price for a dollar
at VND21,458.5, which commercial banks were allowed to apply as an effective
exchange rate, +-1 per cent.
In the flea market,
the US dollar's buying and selling rates were VND21,230 and VND21,260
respectively.
Two days ago, the
central bank released the preliminary report on the currency market in the
first six months. The report said that after the new rate was applied on June
19, the forex rate has stabilised and the market liquidity has been stable.
The report also said that credit rose by 3.52 per cent, while the forex
reserves hit a record US$35 billion.
It also said that
dollarisation continued to decline. By the end of June 2014, the rate of
foreign currency deposits to total means of payment was only about 11.4 per
cent, down from about 12.4 per cent at the end of 2012-2013.
Viet Nam,
Argentina sign MoU
A memorandum of understanding
(MoU) signed with
Under the MoU,
signed by the National Agro-Forestry-Fisheries Quality Assurance Department
of Viet Nam (NAFIQAD) and the National Service of Agricultural Food Health
and Quality of Argentina (SENASA), 204 Vietnamese seafood products would be
exported to
The MoU also
stipulates that each shipment of Vietnamese seafood to
The Viet Nam
Association of Seafood Exporters and Processors (VASEP) said that the new
export market would help seafood businesses maintain production and boost
exports in the context of decreasing exports to the EU and the
Viet Nam Customs'
statistics showed that
Meanwhile,
VN steps up
footwear exports due to preferential tax
Exports attributed
the increase to the Generalised System of Preferences (GSP) tax, offered by
the European Union to Vietnamese exporters since January.
Earnings from
footwear exports to the traditional markets of the
Four FDI
factories licensed in Hai Duong industrial zones
The industrial
management board in Hai Duong granted investment licenses to four FDI
businesses yesterday to build factories in the city's industrial zones.
Believe Zone
Limited Company, a joint venture between
Korean-invested SD
GLOBAL Vietnam Limited Company, with investment capital of $20 million, will
cover 30,000 sq.m in Dai An IZ. Another Korean-invested company, DUSCO VINA
Company in Nam Sach industrial zone, has total investment capital of $5
million and an area of 13,211sq.m.
CHANGHONG Vietnam
Limited Company, funded by the
Much remains to be done to better FDI quality
Much remains to be
done to attract quality foreign direct investment (FDI), and State agencies
will do their best to facilitate FDI firms’ operation and bolster their
confidence in
The agency reported
that registered FDI in the country approximated 6.6 billion USD in the first
half of 2014, representing 64.7 percent of the same period last year’s
figure. The implemented FDI rose by 0.9 percent annually to 5.75 billion USD.
Dang Xuan Quang,
Deputy Director of the Foreign Investment Agency, said existing incentives
have failed to pull the FDI flow along desired directions. He noted that the
flow still focused on certain localities and little went to remote and rural
areas which are in urgent need of investment to improve local socio-economic
situation.
On the other hand,
real estate has attracted a great amount of FDI even though no incentive is
offered for the sector, while important sectors such as agriculture have not
interested foreign investors despite numerous impetus.
Chairman of the
Vietnam Association of FDI Enterprises Nguyen Mai said it is vital to change
investment promotion methods, of which publicising the necessary information
for investors via the Internet is an effective way.
At the same time,
the process of FDI project verification needs to be streamlined so that
investors can quickly begin their projects, he added.
Selecting the right
projects and investors is decisive to the success of FDI attraction,
economist Le Dang Doanh said, noting that authorities should not make
commitments when they haven’t known thoroughly investors’ intention and
potential.
He stressed that
instead of offering too many incentives, localities need to work harder to
improve their investment climate, infrastructure and manpower quality to draw
FDI.
Brian Portelli, an
expert from the United Nations Industrial Development Organisation, said
financial incentives can play an important role in FDI attraction, but they
should not be crucial elements, but supplementary ones.
Reports by the
General Statistics Office said as of the end of December 2013, there were
9,093 FDI businesses in Vietnam, 83 percent of which completely owned by
foreigners.
FDI enterprises
accounted for 45.4 percent of total profit and 30.5 percent of contribution
to the State budget of all enterprises in
Pham Dinh Thuy,
Director of the office’s Industrial Statistics Department, said this year
31.7 percent of FDI firms plan to increase their capital, 79 percent expect
higher revenues, and 81.1 percent hope to gain better yields compared to 2013.-
Trade
promotion programme focuses on agricultural exports
The national trade
promotion programme would priotise the search for new markets for
agricultural products in the coming time, Director of the Vietnam Trade
Promotion Agency Bui Huy Son was quoted by the Vietnam Economic News as
saying.
The national trade
promotion programme has effectively implemented tasks to promote exports,
improve production capacity of the business community and organise trade
promotion activities, supporting enterprises to consolidate their positions
in key markets as well as explore potential markets.
Thanks to the
support from the national trade promotion programme, Many Vietnamese products
are now available in many markets, especially traditional markets like the
US, EU, Japan and China. In addition, the programme has actively supported
exporters to return to traditional markets such as
In addition to
positive results in terms of market expansion, the national trade promotion
programme has also contributed to help enterprises and localities attract
investment, renovate technology and restructure production.
The national trade
promotion programme has made positive contributions to export-import
activities between 2003 and2013. During the period, average export turnover
growth reached 23.6 percent per year while its figure in the 2006-2010 and
2011-2013 period reached 18.3 percent and 22.61 percent per year,
respectively.
In 2013,
In recent times,
the Ministry of Industry and Trade has paid special attention to trade
promotion activities for agriculture, forestry and fisheries products and
focused on promoting agricultural exports to major markets. It can be
affirmed that agriculture, forestry and fisheries products have been a top
priority of the Ministry of Industry and Trade in the national trade
promotion programme.
In 2013, in terms
of agriculture, forestry and fisheries, 23 trade promotion projects in the
national trade promotion programme were approved with a total budget of 28.07
billion VND, accounting for 28.64 percent of the programme’s total budget.
According to
exporters, the national trade promotion programme has contributed to
promoting exports to key markets such as the
As many as 19 trade
promotion projects in the national trade promotion programme for agriculture,
forestry and fisheries continued to be approved in 2014 with a total budget
of 25.64 billion VND, accounting for 36.6 percent of the programme’s total
budget.
In the first five
months of this year, units successfully implemented many projects such as
participating in seafood exhibition in North America, the global seafood
fair, the international fair on food and beverage (Foodex Japan 2014), the
international tea fair in
Through these
exhibitions and fairs, businesses signed contracts worth tens of millions of
dollars, contributing to increase export growth and diversifying and
expanding export markets.
The Mekong Delta’s
Gross Domestic Product totaled VND237 trillion (US$11.14 billion) and
economic growth was estimated at 8.5-9 percent in the first six months this
year, said the Steering Committee for the Southwestern Region in Can Tho City
on July 9.
The economic growth
rate was equivalent to that in the same period last year. Budget revenue hit
VND19,388 billion (US$911.25 million), accounting for 50 percent of the year
estimates.
Deputy Prime
Minister Vu Van Ninh, head of the committee, said that Mekong Delta provinces
have striven to implement the State and Party policies to maintain economic
development and ensure social welfare.
Mekong Delta
provinces should focus on restructuring agricultural restructure, broadening
the market, building sustainable modals of production connectivity and
intensifying science and technology application, he said.
The Government has
instructed agencies to look for domestic material sources and improve product
quality to expand their export markets, he added.
Sabeco
targets two-stage share sell-off and courts strategic partner
The Ministry of
Industry and Trade has just submitted a detailed plan to the government for
the selling off of part of the state’s stake in
Sabeco shares
allured many investors in anticipation of the firm and the beer industry’s
good prospects
Two blocks of
shares will be sold, with the first to reduce the state’s position in the
firm from 89.59 per cent to 65 per cent, and then later down to 40 per cent,
according to a ministry official.
The first sell-off
will see a 20 per cent stake of the company, or 128,257,000 shares, sold to
Sabeco’s strategic partner, which has yet to be named but is familiar with
Sabeco’s stockholders. Around 5 per cent will be sold to the public, raising
some VND2.2 trillion ($104.76 million) for the government.
Sabeco started
focusing on attracting and selecting strategic partners in early 2008, when
it convened a general shareholder meeting to commence operations under a
joint stock model. In late 2012, three leading foreign brewers, including
Heineken, Asahi, and SAB Miller, as well as two other finance and securities
firms expressed interest in investing in the company. But so far Sabeco has
only floated its shares on the Unlisted Public Company Market (UPCoM) and has
not yet announced an agreement on any specific strategic partner.
Under the law, if
Sabeco wants to list shares on the
At present, the
Ministry of Industry and Trade (MoIT) has the power to exercise authority
over the state’s 89.54 per cent ownership in the corporation.
According to the
MoIT’s Vietnam Beer Development Plan 2013, Sabeco is leading in
In terms of its
competition with Heineken, Sabeco has a greater production capacity and has
nearly double the sales.
Asahi and SAB
Miller are also overshadowed by Sabeco. While the formers focus primarily on
Despite global brand
awareness, international firms are struggling to compete with Sabeco, and if
they join the firm as a strategic partner, given the direct competition
between their respective products, there would undoubtedly be conflicts of
interest.
In its first
January 2008 auction, Sabeco successfully raked in VND70,003 (about $3.29)
per share. If a 20 per cent stake is sold, the minimum unit price is likely
to be around this number, which would earn the beer giant VND8.97 trillion
($427 million).
This year Sabeco is
targeting a sales volume of 1.33 billion litres, an increase of 1 per cent
against 2013 with total turnover of VND29.44 trillion ($1.38 billion), up 3
per cent on-year. It forecasted before-tax profits of VND3.67 trillion ($170
million), up 3 per cent on-year.
According to
Sabeco’s quarterly report, the company’s first quarter after-tax profits
reached VND586.49 billion ($30 million), a drop against the same period last
year.
Stringent
tax inspections help spur State budget income
More stringent
inspections at enterprises conducted by taxation and customs agencies in the
year’s first half have helped recover trillions of
Nearly 21,000
enterprises were probed in the first six months of the year, an increase of
over 64% against the year-earlier period, and such an activity helped the
taxman collect an additional VND4 trillion, the ministry said in a report
reviewing tax collections in the year’s first half.
Tax agencies had
also reviewed and settled tax arrears totaling over VND17 trillion as of the
end of 2013 that were carried over to 2014, making up 29% of the total tax
debt.
Along with tax
authorities, customs agencies also tightened their grip over import-export
activities, reviewing 1.3 million customs declarations, inspecting 610,000
declaration documents, and inspecting the cargos stated in 237,000
declarations. Such efforts helped this agency uncover and handle more than 8,900
violation cases with a combined value of VND146 billion worth of goods.
Such inspections by
both the tax and customs departments – two key arms of the Ministry of
Finance – are meant to tighten tax management, recover tax arrears and timely
make up for the State Budget deficit.
Thanks to strict
inspections, the State budget overcame its hardest time, even at the peak in
the end of 2013. The State budget revenue in the first six months of this
year reached approximately VND413.6 trillion, achieving 52.8% of the estimate
and rising 15.8% compared to the same period in 2013.
The Ministry of
Finance noted that the positive results come from the drastic measures of the
tax and customs authorities battling tax evasion.
Spending from the
State budget in the first six months of 2014 is estimated at VND492.4
trillion, making up 48.9% of the estimate and rising 8.8% year on year.
The overspending in
the first six months is estimated at VND78.8 trillion, 35.2% of the level
endorsed by the National Assembly for the whole year. The overspending is
being financed by domestic and foreign borrowings as planned.
As of the end of
June, the Government had mobilized VND196.5 trillion through G-bonds,
equivalent to 62.3% of the whole year’s target.
AGPPS cuts
deal with R&D center for organic agriculture
A strategic
cooperation agreement was clinched on Tuesday between An Giang Plant
Protection JSC (AGPPS) and Plant Protection Research Institute with an aim to
develop solutions for producing organic products.
According to the cooperation,
the research and development (R&D) institute will make studies to create
biological products for use in agriculture and transfer them to AGPPS for
mass production.
Both parties also
pledged to cooperate in creating new products based on AGPPS’ orders.
Huynh Van Thon,
general director of AGPPS, said 78% of the farmers have demand for biological
products in agriculture, citing a survey conducted by the company in the
Mekong Delta and other southern provinces.
Thon stressed that
his company would strengthen cooperation with universities, institutes and
foreign partners for developing organic products, minimizing pollution and
ensuring food safety.
Last Tuesday, AGPPS
opened the first phase of the center for bio-products research and
development in An Giang’s Chau Thanh District. Thanh said this center would
serve as a bridge linking his company and other research centers.
In the first phase,
the center covers an area of 3,800 square meters, which will be expanded to
5,700 square meters in the next phase.
Online FMCG
retail takes fast-track move
The online
Fast-Moving Consumer Goods (FMCG) retail is accelerating in many countries
including
In Vietnam, the
online FMCG market is still in its infancy with only 2% of urban households
going for online shopping, making up a mere 0.1% of the total FMCG
consumption last year. However, it is predicted to develop quickly in coming
years because the young generation has a growing tendency towards online
shopping facilitated by the 63% Internet penetration rate of urban households
in
A survey conducted
among 100,000 Vietnamese households shows the average frequency of online
FMCG buying in each family was two times in 2013. In addition, the online
shopping cart is three times higher than that in other traditional shopping
channels.
According to
Stéphane Roger, Global Shopper and Retail Director at Kantar, selling
products on online stores will help boost revenue rather than reducing
consumption in retail stores.
As reported,
businesses are afraid that online stores will affect the income of other
channels and the customers will be less faithful. However, the survey proved
the reality is definitely against their worries.
Roger announced on
Tuesday the growth of online FMCG market is impressive in many countries
although it only takes a small segment in the total market value. The Asian
FMCG market is predicted to post the highest growth.
At present,
Kantar forecasts
online shopping will generate US$53 billion for the global FMCG market by
2016, rising 47% compared to US$36 billion currently, and contribute 5.2% to
the global FMCG revenue.
The growth in
online FMCG market opens up opportunities for businesses because most online
buyers who have high and median income prefer branded products. The
sharp-witted brand names and retailers who take the advantage to expand their
target market will beat the others, said Roger.
FPT buys
123mua.vn from VNG
Sen Do Company, a
member of FPT Group, on July 9 officially took over the trading floor
123mua.vn of VNG Corporation.
Sen Do Company,
which is operating the online trading floor sendo.vn, after taking control of
123mua.vn will continue to implement all contracts that the trading floor had
signed with partners before.
A source said the
deal includes the network management system and the database of customers,
but it is not clear whether the human resource is transferred or not.
Tran Hai Linh,
general director of the e-commerce floor sendo.vn, said the deal is part of
the development strategy of sendo.vn.
This e-commerce
website will provide new services for its customers, such as goods delivery,
payment by cash and online transactions through the FPT’s system.
Sen Do JSC, an
offshoot of FPT Online Company, was established on May 13 2014 with the legal
representative being chairman Nguyen Dac Viet Dung, former general director
of FPT Online Company.
The e-commerce
floor 123mua.vn has around six million visitors and 2,500 new stalls
registered a month. It has 80,000 products on sale, mainly technology and
fashion items for young people.
PetroVietnam
welcomes new leader
The Vietnam
National Oil and Gas Group (PetroVietnam - PVN) on July 15 announced the
Prime Minister’s decision to appoint Nguyen Xuan Son Chairman of the group’s
Board of members.
Addressing the
ceremony, Deputy PM Hoang Trung Hai expressed hope that Son will work closely
together with the group’s leadership to develop PVN into a powerful, highly
competitive economic group in the world.
He asked PVN’s
leadership and staff to focus on technological and human resource research
and development to surmount difficulties and seize opportunities to move the
company forward.
PVN Chairman Son
vowed to work hard to develop the company steadily. He said PVN’s primary
tasks are to tackle pending issues in a number of its affiliates, speed up
economic restructuring, and concentrate on energy development projects.
Born in Ha Tinh
province in 1962, Son graduated from the US University of South Carolina,
majoring in business administration. He has worked for the oil and gas sector
for almost 30 years.
Tokyo firms
seek cooperation opportunities in Ha Nam
A delegation of
business community leaders from
At a July 15
working session, Mai Tien Dung, chairman of the provincial People’s
Committee, briefed the Japanese guests on investment policies and incentives,
underscoring the point the province strictly adheres to commitments it makes
to foreign investors.
“Most especially
the province will do its utmost to ensure security and safety of foreign
investors and their projects,” Dung said.
A representative
from the Tokyo Chamber of Commerce and Industry (TCCI) Koyama Kduji said
Southeast Asia in general and
All eight
participating business leaders conveyed strong desires to cooperate with
their Vietnamese counterparts, including those in Ha
A representative
from Tokyo Braze Company specialising in welding said his company is desirous
of opening a production branch in
Another
representative from Tokyo Byora Company which trades different kinds of
screws and metal fasteners hoped to locate a partner in Ha
Cooperation will
benefit both sides as Ha
Last but not least,
Yasahiite Company which supplies nurses to take care of the elderly said the
company needs to recruit around 6,000-10,000 nurses each year.
To date it has only
employed a few Vietnamese nurses but wants to employ more in the future.
During this trip to Ha
Textile
investors keen on Vietnamese market
Garment and textile
projects attracted 70.62% of all domestic and foreign investment capital in
According to the Ho
Chi Minh City Export Processing and Industrial Zones Authority (Hepza),
advanced textiles cumulatively surpassed the US$200 million mark, accounting
for 82.44% of all total foreign direct investment (FDI) in its EPZs and IZs.
Tran Viet Ha, head
of Hepza's Investment Department, said that foreign investors are
implementing large investment projects in the textile and garment sector in
the city’s industrial and processing zones at an ever increasingly faster
pace.
The surge in
international investment in these zones is largely attributable to textile
processors’ anticipation of
The projects
include a US$140 million facility producing high-end garments by Worldon
Vietnam Co., Ltd. and a US$50 million factory producing high quality textiles
of Sheico Vietnam Co., Ltd.
Ha added that in
the coming time, there will be more textile investment facilities taking
shape in
With the aim of expanding
investment and channelling it into support and hi-tech industries, Hepza will
also continue to accelerate the establishment of specialized industrial zones
in Vinh Loc, Tan Tao, and Tan Thuan.
Ho Xuan Lam, office
manager of Hepza noted that the authority has on the agenda plans to launch a
Japan-Vietnam support industry forum aimed at enticing Japanese small and
medium enterprises to invest in priority areas.
As of June 30,
Hepza reported total newly registered and supplementary investment capital in
the nation has reached US$333.47 million, up 55.49% over June 30 of last
year.
Export
target tough task for tuna industry
The domestic tuna
industry will find it difficult to reach its export value target for the year
because of reduction in exports since the beginning of this year.
According to the
Vietnam Seafood Exporters and Producers (VASEP), the exports of tuna, the
seafood product having the third largest export value after shrimp and tra
fish, reduced in volume and value two years ago.
Last year, its
export value had a year-on-year fall of 7% to US$526 million, and the value
was initially expected to gain a year-on-year of 6.46% to US$560 million for
this whole year.
However, that
expectation is cut to US$450 million for this year because of numerous
challenges faced by local tuna exporters.
In major export
markets of Vietnamese tuna, including the
In the first five
months of this year,
During the first
five months, the tuna export value to the
The tuna export
value to
The reasons for the
reduction in export value include lack of supply, trade barriers and
competition with other tuna exporting countries.
VASEP said that the
larger markets have asked the exporter to meet the requirements on origin of
seafood including the new EU Illegal, Unreported and Unregulated (IUU)
fishing law and a certification for seafood traceability in the
However, Vietnamese
exporters are finding it hard to meet these requirements due to inadequate
data on journals of seafood exploitation and preservation from fishermen.
The export markets
have also tightened activities on managing food hygiene and safety, making it
difficult for local tuna exporters to increase business in the large markets.
Additionally,
competitive ability of Vietnamese tuna products has also reduced due to low
domestic supply and high import tax for tuna that used to be processed for
export. Now,
Dong Nai
seeks to boost exports to RoK
Dong Nai province’s
exports for June to the
Director of the
provincial Department of Industry and Trade Le Van Danh said that with these
exceptional financial results for June, the RoK has now become the province’s
second largest export market.
Key export products
to the RoK during the six month period included footwear, garments, textiles
and fibre, wood and timber products, and agricultural products.
The significant increase
in gross exports is directly attributable to increased trade resulting from
the ASEAN-RoK free trade agreement, Danh said.
Danh added that
currently Dong Nai is experiencing high demand from the RoK for fruits like
rambutants, mangosteens, jackfruits and bananas and similar agricultural
products.
Last year, the RoK
imported 6,000 tonnes of mangoes and figure is expected to increase to 10,000
tonnes this year.
Provincial
businesses are optimistic about prospects for increased trade and are
scurrying to coordinate a joint marketing effort with Korean partners aimed
at introducing Vietnamese fruits to broader segments of the Korean consumer
market.
Nguyen Thi Le Hong,
General Director of the Dong Nai Food Industrial Corporation (Dofico), said
her company has strengthened coordination with Korean Nam Sa and other
companies to market agricultural products in
As one specific
example, Dofico has teamed up with Korean Nam Sa in an Italian Rygrass
project specifically targeting the Korean husbandry industry market.
Nam Sa General
Director Choi Young Chul said that Korean people need healthy food like
fruits. However, the Korean demand far outstrips the nation’s supply,
creating an opportunity for Vietnamese fruits to penetrate the market.
Nam Sa is bullish
on Vietnamese fruits and is currently investigating several opportunities for
joint projects with Vietnamese businesses, particularly those in Dong Nai.
However, it is
quite difficult to bring Vietnamese fruits to the Korean market as the
country imposes strict requirements on the quality of products.
The Korean
Government requests thorough investigations of each farm exporting products
to the market; including a wide variety of tests covering such areas as soil,
factory processing procedures, preservation, packing and transport processing
procedures.
Nguyen Van Thu,
Director of the G.C Food Company at Giang Dien Industrial Zone, said the RoK
imposes strict requirements for high quality products, including ISO 22000 on
quality management.
All requirements
can be met by G.C Food Company so Korean partners plan to visit G.C Food
factory to sign export contracts in August, Thu said.
Fines
mulled on slow dividend payers
The companies slow
in paying dividends to shareholders will face fines in the coming time as
relevant agencies are mulling this, said a deputy general director of the
Hochiminh Stock Exchange (HOSE).
Tran Anh Dao told
reporters in HCMC on Tuesday that a number of listed enterprises have delayed
dividend payment to shareholders for years and this affects the interests of
the latter. HOSE has warned the firms of their long delays but there has not
been any legal document on punishing them as existing rules regulate the
payment is decided by enterprises based on their profits.
HOSE used to
propose imposing fines on the slow dividend payers and the State Securities
Commission discussed the issue late last year.
If Decree
108/2013/ND-CP on administrative fines in the securities sector is revised,
the fines for late dividend payment will be added. Dao said specific fines
are being considered and will likely be applied next year at the latest.
Dao said HOSE wants
regulations on dividend payment to be made stricter and practical instead of
letting enterprises decide this based on their net profits.
As usual,
enterprises attribute their late dividend payment to late revenue collections
and the profits used to invest in ongoing projects.
At the meeting with
reporters, Dao painted a positive picture of HOSE despite the fact that only
three firms listed their shares on this southern bourse in the first six
months of this year. She expected that things will change in the second half
and next year.
Dao forecast more
than 10 enterprises will get listed on the southern bourse this year compared
to four last year. However, there will be more listed firms next year as
companies still cope with a host of barriers, including those linked to
regulations on return on equity (ROE).
Circular
73/2013/TT-BTC, which took effect on July 15 last year, states that joint
stock companies must post ROE of at least 5% in the year right before their
listings after being merged if they want to get listed on either the northern
or southern bourse. Therefore, many firms wait for more time to have better
business results to improve their ROE.
Incentives
– not the key to attracting foreign investment
Many hold the
misconception that the key to attracting investment is simply to offer more
incentives. The theory is the more incentives offered the more foreign
investors will flock to
However, this
rather simplistic supposition does not always bear out and, indeed, is not
grounded in the reality of
According to many
leading economists and market analysts, incentives are only one factor to
attract investors, and most often not the most important factor.
Dang Xuan Quang,
the Ministry of Planning and Investment (MPI)s Foreign Investment Agency
(FIA) Deputy Head said that in recent years
“However the
effectiveness of these incentives has been noticeably limited,” Quang said.
In support of his
assertion, Quang cites FIA statistics that revealed as of June 2014,
Most of the
projects operated in the larger metropolitan areas of
Other provinces
such as Dak Nong,
In these latter
provinces the government and local officials offered tremendous incentives,
particularly in the agro-forestry and fishery sectors.
However, as of June
2014 these provinces have only attracted a modest number of 508 projects with
investment worth US$3.382 billion in total, accounting for 3.06% in volume
and 1.41% in value of
In direct contrast,
Quang cites the real estate market, which in spite of having received no
special incentives to speak of, has developed into a highly lucrative market
that investors are eagerly pumping money into.
In the first half
of the year, out of the total FDI in
Meanwhile only a
fraction of that total, US$27.38 million, or 0.3% of total FDI, was injected
into the agro-forestry and fishery sector.
This is a clear and
unambiguous example of a situation where investment incentives were not
effective in luring investment.
Dr. Le Dang Doanh,
a leading economic expert, said the key to luring foreign investors, setting
aside the provision of incentives, is improving infrastructure, increasing
the quality of human resource and boosting institutional reforms.
The United Nations
Industrial Development Organisation (UNIDO) recently released a study on
“The survey results
indicated many businesses who did not receive preferential incentives are
operating well and have expansion plans,” Doanh said.
Brian Portelli, an
official of UNIDO, shares Doanh’s views saying that from his knowledge and
experience there have been no clear differences in operation results in
He listed
preferential tax and other incentives, political stability and favourable
business climate as primary factors affecting their decision to invest in the
country. Human resource also plays a vital role, he added.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Tư, 16 tháng 7, 2014
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