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BUSINESS
IN BRIEF 15/9
Quang Ninh
highway work starts
Prime Minister
Nguyen Tan Dung on Saturday gave the order to start construction of a highway
linking Ha Long city in the northern coastal
The 19.5km highway
will be built at a total cost of over VND6.4 trillion (US$300.8 million) from
The four-lane
highway has been designed for vehicles to run at a maximum speed of 100km per
hour.
When completed in
2016, it will shorten the distance between Ha Long and Hai Phong from 75km to
25km.
Dung hailed Quang
Ninh's efforts in mobilising resources for the project. He said this was the
first highway construction project started by a locality by mobilising local
resources.
He said it was
significant in economic, cultural and social development terms and also for
security and defence for the province and the nation.
Dung praised the
province for strictly complying with Government regulations on land clearance
and compensation.
He said by time
work started, all land clearance work had been fully completed. He also
expressed his appreciation to the more than 900 affected households for
co-operating with the project in the common good.
He asked the
Ministry of Transport and the Ministry of Planning and Investment and other
relevant agencies to facilitate work with Japanese partners so that an early
start could be made on construction of the Bach Dang bridge that will link
the Ha Long-Hai Phong highway to the Ha Noi-Hai Phong highway.
Work on Bach Dang
bridge is expected to begin in the first quarter of 2015. The bridge will be
5.45km long and cost VND7.2 trillion (more than US$342.85 million) under the
build-operate-transfer form by Japanese group SE.
The new highway
will help increase the flow of goods between Quang Ninh and
Dung also attended
a conference in Quang Ninh to announce the province's seven strategic plans.
The plans, which
cover the period to 2020 with a vision until 2030, include overall
socio-economic development for the province, construction for areas within
the province, tourism development, environmental goals, land-use, scientific
and technological development, and human-resources development.
Dung praised
provincial authorities and people for their remarkable achievements in
socio-economic development. He cited the province's high annual GDP growth
rate of 9 per cent - and the sharp decline to 2 per cent in the number of
poor households.
At the same time,
Dung urged the province to ponder its failure to take full advantage of its
potential. As an example, he said agriculture contributed to only 6 per cent
of the province's GDP, yet it used 40 per cent of the province's workforce,
indicating that this mismatch was unsustainable.
He also said many
issues related to environmental pollution remained unsolved, and labour
productivity was still low.
Dung urged the
province to pay special attention to administrative reforms so prospective
investors would be impressed.
He also instructed
the province to build a strong, transparent and effective political system,
strengthen national defence and security, safeguard national sovereignty and
promote relations with neighbouring
Trade
surplus forecast on export growth
If so, this will be
the third consecutive year that the country has achieved a trade surplus.
Figures from the
Ministry of Industry and Trade (MoIT) showed that the country's trade surplus
in the first eight months of the year reached $1.7 billion, or 1.8 per cent
of total export value.
But the MoIT noted
that most of the exports came from foreign-invested enterprises.
In the first eight
months, Vietnamese enterprises reported a $10.16-billion trade deficit while
foreign-invested enterprises reported nearly $11.86 billion in surplus.
Vietnamese
exporters have to import a large volume of imported input materials. Although
Its dependence on
imports has incurred for the country a trade deficit with
To boost exports of
high value-added products, the MoIT said it was co-ordinating with the
Ministry of Agriculture and Rural Development in adopting restructuring
measures to increase the added value of
The Government has
also issued a decree to enable domestic enterprises to invest more in support
industries so that components, equipment and machines produced at home could
gradually replace those imported from abroad.
Producers of the
country's key exports such as textiles and garments, mobile phone and
electronics products, footwear and agricultural products have so far remained
optimistic about their prospects in the last months of the year.
After surpassing
mobile phone and electronics products as the country's top export earners,
textiles and garments are expected to continue its leap into the last quarter
of the year, when demand is expected to rise sharply ahead of holidays such
as Christmas and New Year.
A good number of
garment export producers say they have cornered enough orders for the whole
year. The country's textile and garments industry targeted $23 billion in
revenues from exports this year. In the first eight months of the year, its
revenues reached $13.65 billion, a 19.7 per cent year-on-year increase.
Export value to major markets rose significantly by 36 per cent in
Industry insiders
say garments exporters are also benefiting from a decrease in the world price
of imported input materials such as cotton. In the
Producers of
agricultural exports are likewise optimistic. Tran Anh Tuan, MoIT deputy
minister, said rice exports this year would meet Government targets.
According to the
Viet Nam Food Association, rice exports this year will surpass the 6.2-million
tonne export target and earn $1.83 billion.
With 4.2 million
tonnes of rice exported in the first eight months of the year and a forecast
of 1.9 million tonnes for the third quarter and 1.4 million tonnes for the
fourth quarter, the country's rice exports for 2014 will likely reach 6.3
million tonnes, excluding unofficial exports in small quantities through the
borders, the association said.
Rice demand in
import markets from now till year-end are also trending upwards, the
association added. It cited the
The Viet Nam
Association of Seafood Exporters and Producers also predict the industry's
export revenue this year to increase by 13 per cent more than that of last
year to $7 billion. Shrimp is expected to be the industry's biggest earner at
$3 billion.
Export
forum focuses on prospective markets
They also need to
focus on improving quality to meet the demands in importing countries,
according to attendees at the Export Forum.
Nakajima Satoshi,
the Japanese consul in
But to export
there, Vietnamese companies had to strictly follow its quality, hygiene, and
safety requirements, he said.
Bui Trung Thuong of
the Viet Nam Trade Office in
The Indian
Government annually adjusted its trade policy and so Vietnamese exporters
should monitor it, he said.
"Indian
consumption habits are quite different from that of
Others spoke about
the pros and cons of exporting to
But exporting to
the market is complicated, requiring many kinds of licences, and firms need
to understand its regulations.
Latin American
countries also have similar demand for consumer goods, but the lack of market
information, high transport costs, fierce competition with Chinese and Indian
goods, and trade barriers in some markets in the former are among
difficulties Vietnamese firms could face, Tran Duy Dong, deputy head of the
America Market Department, said.
More effort should
be made to provide Vietnamese exporters more information about these markets,
he said.
Delegates said
businesses should take part in foreign trade fairs and exhibitions to do
market research and look for new business partners.
Minh said they
should also invest in improving their design and packaging.
Free trade
agreements the country has signed or plans to sign offered great
opportunities for Vietnamese firms to boost exports, attendees said.
Guillaume Crouzet,
director of the French Chamber of Commerce and Industry in Viet Nam, said,
"Trade between the EU and Viet Nam will be boosted by the FTA under
discussion."
Delegates urged
Vietnamese companies to reform export-promotion activities and do research on
customer preferences.
While focusing on
exports, local firms should not ignore the domestic market either, Tran Du
Lich, member of the National Assembly's Economic Commission, said.
"A product
looking to compete in foreign markets must firstly be competitive in the
domestic market both in terms of quality and price," he said.
The problem now is
not that what products are to be exported, but how to create differentiation
of products to improve competitiveness, he said, adding that this is a
challenge to Vietnamese firms trying to expand exports.
They should
diversify exports to five key markets — the US, EU, ASEAN,
They should
continue to try and expand market share but not to excessive levels in any
market because that would then prompt the importing country to erect barriers
such as anti-dumping duties to protect local production, he warned.
The forum was
organised by the Investment and Trade Promotion Centre of HCM City.
According to the
Ministry of Industry and Trade, despite many difficulties
The ministry
promised to keep a close watch on the global economic situation and provide
information about export opportunities.
Trade deal
to widen access to EU
A bilateral Free
Trade Agreement with the EU will yield tangible and intangible benefits for
both
"The FTA
currently under negotiation targets to reduce at least 90 per cent of tariff
lines on Vietnamese exports," Dr Franz Jessen, ambassador and head of
the EU Delegation to
"This implies
that greater opportunities lie ahead for Vietnamese business to penetrate
deeper into the EU market."
Viet Nam's exports
to EU account for around a fifth of all its exports, but only 40 per cent of
them are tax free or subject to preferential lower rates while the remaining
attract ordinary import duties.
For instance,
Vietnamese producers could have saved 150 million euros (US$194.4 million) a
year on footwear products and 180 million euros ($233 million) on textiles in
each of the past three years if an FTA had been in place.
Footwear products
attract 3.5-4 per cent import duty and textiles, 9.6 per cent.
In return, European
drug producers pay import duties of 5 – 8 per cent on shipments to
"Furthermore, the
EU with advanced technologies, abundant capital, and management expertise can
offer what Viet Nam is not yet able to produce at home," Jessen added.
"The FTA will
create wider impacts on
A study by the
EU-Viet Nam Multilateral Trade Project in 2011 found that an FTA between the
EU and Viet Nam would have a "largely positive impact on the country's
GDP" estimated at around 2.7 per cent a year in case of rapid
dismantling; in case of progressive dismantling, there will be a gradual
increase from the second year to 3.7 per cent in 15 years.
If the
implementation is properly managed, the FTA can trigger necessary reforms in
During a recent
visit to
Leading
businesspeople and representatives of EU member states and national business
groups attended the luncheon meeting.
In June 2012 the EU
and
The negotiations
cover tariffs as well as non-tariff barriers to trade and other trade-related
aspects such as public procurement, regulatory issues, competition, services,
intellectual property rights, and sustainable development.
It is expected to
be signed next month.
Lenders
fail to jumpstart sluggish borrowing in August
Vietnamese banks
are likely to promote lending programmes that hopefully will help them to
either unleash idle capital or boost the sluggish credit growth toward the
end of the year.
State Bank of
Given the minimum
10 per cent rate, banks still need to add 5.5 per cent to make it up.
"Capital
demand may increase in the last few months of the year when businesses get
busy, preparing for Tet festival," said Cao Sy Kiem, chairman of the
management board of DongA Bank. "However, a 12 to 14 per cent target is
very difficult to achieve."
"The 10 per
cent target is only achievable if the government's programmes to bolster the
total demand are laid out clearly with every single effective step and taken
seriously, while banks and enterprises are able to work cooperatively to pump
and absorb capital," Kiem said.
Some bankers said
the competition was likely to become tougher that would keep all lenders on
their toes.
DongA Bank, which
achieved 4 per cent credit growth in the last eight months, now aims to
provide loans to borrowers from rural and agricultural businesses, private
sector and households who evidently have high capital demand, good capital
utilisation and low risk of bad debts.
Sacombank earlier
this week launched a priority package of VND2.5 trillion (US$118 million) for
importers, exporters, and those in aquaculture, pharmacy, gasoline,
transport, tourism, textile and garment, shoes, electronic components, food
and consumer goods sectors. The minimal lending rate is 7 per cent in the
first six months.
One of the big four
banks by assets, Vietcombank has just announced a VND3-trillion ($141.5
million) credit package, with the lending interest rate set at 7.99 per cent
per annum.
MaritimeBank offers
VND1 trillion ($47 million) loans to Ha Noi-based companies at a borrowing
cost of 7 to 8 per cent per year for short-term credit and 9 to 11 per cent
for mid and long-term loans.
Tran Xuan Quang,
CEO of SME Banking at Maritime Bank, said that banks were always willing to
help enterprises to overcome economic difficulties. However, enterprises
themselves needed to improve their financial management to get their money's
worth.
HDBank has made a
similar move by giving VND1.5 trillion ($70.7 million) to individuals, and for
consumer purposes and production plans, and by setting aside VND5 trillion
($235.8 million) for small and medium-sized enterprises.
ABBank has joined
the race by offering personal loans worth VND1 trillion ($47.07 million) at
8.5 per cent for the first 12 months.
LienVietPostBank
announced to lend VND2 trillion ($94.3 million) for various terms at interest
rates starting from zero per cent.
Under the current
circumstances, bankers expect an improvement in the total demand, purchasing
power and employment rate, which are important factors to bolster businesses
and production.
The tourism sector
will carry out measures to attract more Russian visitors to
The Russian market,
which has more than 11 million outbound travelers per year, is a major market
of the country's tourism sector, said Nguyen Quoc Hung, deputy head of VNAT.
Many more hotels
and resorts with a wide range of high-quality services will be built to meet
the demand of Russian vacationers who usually spend seven to 14 days for
their vacation with high spending, he said at a workshop held yesterday (Sep
11) in HCM City.
Marine tourism
products will be diversified to attract Russian vacationers to beaches in Nha
Trang, Mui Ne, Phu Quoc, Ba Ria-Vung Tau, Ninh Thuan,
The unrest in
Various promotional
programmes have also been carried out in
A delegation led by
officials from HCM City's Department of Culture, Sports and Tourism will take
part in the 20th International Trade Fair for Travel & Tourism- OTDYKH
Leisure 2014 in Moscow from September 16-19.
The departments of
culture, sports and tourism from Ha Noi,
The Vietnamese
delegation will also meet with local partners from
In March next year,
the Viet Nam National Administration of Tourism will lead tourism and travel
agencies and enterprises to promote the country's tourism industry at Moscow
International Travel & Tourism Exhibition (MITT).
The number of
Russian tourists rose to 298,000 last year from 174,000 in 2012 and 101,000
in 2011.
In the first eight
months of the year,
Marks &
Spencer opens with a bang
British retailer
Marks & Spencer, which opened in
At the official
opening ceremony of its first store in
The result has
surprised them, he said, adding that 80 per cent of customers were
Vietnamese, proving that the Vietnamese retail market is very promising.
Marks &
Spencer's first outlet in the country is in
Talking about
future plans, Bruce Findlay, the retailer's regional director for Asia, told
Viet Nam News that "there is great potential in the Vietnamese retail
market … We see about 20 stores in the next five or six years. We will open
another store here in
The second and
third stores will open in 2015 before going to other major cities in 2016.
The company plans
to update its products every month, and customers can also order online and
get delivery from the store.
Marks and Spencer,
one of the
In
Housing law
restricts foreign homebuyers
Foreigners entering
The National
Assembly's Standing Committee was still discussing the latest version of the
law last Wednesday and was expected to submit the final draft to the National
Assembly for approval by year-end.
The amended law,
which will take effect on July 1, 2015, aims to tighten regulations on the
right of foreign individuals and organisations to own houses in
The regulation
allowing all Viet kieu (overseas Vietnamese) and foreigners to own houses in
the country was seen in the previous draft, along with the Standing
Committee's comments, during a meeting last month.
At that meeting,
National Assembly Chairman Nguyen Sinh Hung said foreigners who bought houses
for accommodation, doing business, studying or settling in Viet Nam would be
encouraged, but those who would enter the country for several days and leave
after buying a house would be discouraged.
The draft sets
clear conditions for foreigners to buy houses in
In addition, the
number of apartments in a building or area that will be sold to foreigners
will be capped to ensure security.
Payments must be
done through banks and credit institutions accredited for the purpose to
prevent speculation and money laundering.
Foreigners will be
allowed to own their houses for a maximum of 50 years from the date the house
ownership certificate was granted.
Extensions will be
allowed but must be in compliance with existing laws.
In the years
preceding 2010, it seemed that enforcement efforts were effective, with huge
amount of cigarettes were destroyed. However, since then the amount of
smuggled tobacco has increased by 50%. One official from Market Control
Department commented that their staff, customs officials and police were
discouraged because of low funding.
According to the
Vietnam Tobacco Association, 30% of
There are some who
argue that revenues from tobacco sales contribute a great deal to state
coffers, and that ways should be found to support the domestic industry,
which would aid in the anti-smuggling efforts.
One suggestion was
that smuggled tobacco of genuine origin be re-exported after it is
confiscated, instead of being destroyed.
They claim that
this could save the state budget up to VND100 billion in expenses for
destroying smuggled tobacco, not to mention the funds from re-exportation.
Many experts have
gone on record as saying the best way to fight tobacco smuggling is to
improve the domestic industry. There is somewhat of a consensus that the
government should create more favourable conditions so that Vietnamese
producers can compete with foreign brands.
Vietnam
tops US investment choices in SEA
AmCham
The survey showed
that as many as 37% of companies who responded said they had plans for future
business expansion in
Among the
respondents, 75% said that they would choose
Of those asked, 79%
of companies said that the Trans-Pacific Partnership (TPP) agreement with the
participation of 12 countries, including Vietnam and the US, would have
positive impact on American trade and investment activities in Vietnam.
More than half,
57%, said that
The respondents
pointed out some particular advantages of investing in the country, including
cheap labour, tight security and political stability. Still, some had worries
about issues such as corruption, lack of infrastructure. The anti-China
protests caused particular worry.
According to the
Ministry of Planning and Investment, the
Source: VNN/VNS/dtinews/VIR
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Chủ Nhật, 14 tháng 9, 2014
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