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BUSINESS
IN BRIEF 1/9
1,000
businessmen to attend CEO forum
1,000 domestic and
foreign entrepreneurs will come together in the CEO forum 2014, which will
take place in Ho Chi Minh City on September 24, said the HCMC Young
Entrepreneurs Association yesterday.
With themed “New
game – which moves”, this year program will refer to opportunities and
challenges from global integration, and participation in the ASEAN Economic
Community and the Tran-Pacific Partnership agreement.
The forum is
expected to find out measures for sustainable development and
MoF bends
again on rubber tax, now zero
The abolition of
the export tax on rubber, starting October 2, is expected to ease some of the
difficulties currently plaguing rubber firms.
According to
Circular 111/2014 issued by the Ministry of Finance, the export tax rate on
rubber will be reduced to 0 per cent from the current 1 per cent.
Listed rubber firms
saw a sharp on-year drop in profits in the first half of this year, mainly
due to low global demand.
Phuoc Hoa Rubber
Joint Stock Company (HOSE:PHR), the largest listed rubber firm, earned
VND120.735 billion ($5.8 million) in net profit, down 13 per cent on-year.
The next biggest firms, Dong Phu Rubber Joint Stock Company (HOSE:DPR) and
Thong Nhat Rubber Joint Stock Company (HOSE:TNC), saw their net profits more
than halve to VND70.615 billion ($3.35 million) and VND11.262 billion
($52,000) respectively in the first half.
The Ministry of
Agriculture and Rural Development estimated that
Difficulties are
expected to persist for rubber firms, as there looks to be a surplus of
652,000 tonnes of rubber latex this year, reported London-based consultancy
company Rubber Economic.
Husbandry
sector reliant on imports
In the first six
months of this year,
Van said
"We need to
shift a number of areas used for rice cultivation to planting corn so we can
increase the local supply," he said.
Minister of
Agriculture and Rural Development Cao Duc Phat said that the animal health
sector should also pay more attention to animal disease prevention and
control, management of animal medicine and food safety and hygiene. The
husbandry sector also needed restructuring in order to boost the competitiveness
of its products, Phat said.
Time-honoured
porcelain company a true comeback story
Hai Duong Porcelain
Factory (now Hai Duong Porcelain JSC), born more than half a century ago in
the northern province of the same name when the industry was just fledgling,
once was a cornerstone in the domestic porcelain industry.
The company’s brand
is deep rooted in the mindset of generations of Vietnamese people,
particularly those in northern areas.
The company,
however, has since taken a steep fall due to its obsolete management style
and operating structure when the economy began to function under the market
mechanism.
In 2008 the company
was buried in losses and debts totalling 140 per cent of its charter capital.
At the same time employee wages fell to an average VND1 million ($47) per
capita per month and the brand nearly faded into nothingness.
“At that time there
was an overwhelming supply of unsold porcelain products in the factory’s
workshops, causing tremendous waste of materials and workforce,” recalled the
company’s chairman and general director Nguyen Do Ha.
At the same time,
more than 41,000 square metres of workshop space was in disrepair and
resultantly ineffective production lines.
“How could a brand
that had such a long history and strong track record find itself on the verge
of bankruptcy?” was the question all of the company’s management were asking.
After carefully
considering the situation, the management decided to cut back on production,
focusing only on 44 product lines, rather than the 1,300 at the firm’s peak.
They also went to work restructuring their output market.
The company focused
on serving and deepening its roots in 15
“Not many people
know that in 2008 we were still selling products directly from our production
facility. We then revolutionised our sales strategy and brought products to
the customers, rather than waiting for them to come,” said the company’s
research department head Thu Hang.
The company also
took the bold step of cutting down production lines from three to only one to
bolster efficiency.
Staff training was
also a top priority, alongside applying a cross-check scheme to assess the
work quality of each labourer on a monthly and quarterly basis.
These improvements
breathed new life into the company’s development.
In the first year
after embracing renovation, Hai Duong porcelain was back in the black and
later gradually offset its cumulative losses, paid off its bank loans and
raised its workers’ salaries, which are now four times what they were in
2008.
In March 2014, one
of its main shareholders – the State Capital Investment Corporation (SCIC) –
successfully sold its 36 per cent stake in Hai Duong Porcelain at a public
auction and got a return on investment more than triple what it had paid.
At present, the
company markets about 1.5 million items per month and can only satisfy
one-third of order volume.
Therefore the
management is reportedly mulling ways to make further headway. “Hai Duong
porcelain still has a ways to go in reconfirming its position in the market
and further bolstering its traditional Vietnamese brand,” Ha explained.
Online tax
payments increase efficiency
Online tax
payments, first applied in August 2013, have vastly increased efficiency,
vice director of
Previously,
taxpayers had to go to the State Treasury to submit the required paperwork
and the Government agency had to complete four or five procedures. At
In addition to
halving the amount of paperwork, this also helped avoid overlap when
inputting taxpayer information to the State Treasury and bank systems, Hai
said.
Since last August,
Vietinbank's system was used for about three million tax payments worth
trillions of Vietnamese dong, according to Director General Le Duc Tho.
While the online
system increased efficiency, it was still difficult to deal with foreign
currency and unstable Internet transmission lines during peak times such as
the end of the working day or month, said director general of the State
Treasury Nguyen Hong Ha.
Enterprises will no
longer have to declare and calculate value added tax (VAT) if importers return
their goods or the goods are circulated within sectors of the enterprises
after a new Finance Ministry circular takes effect next month.
The circular also
regulates that enterprises will not have to fill out invoices and declare VAT
if they export machines, equipment, materials and goods for borrowing or
returning.
The move, which
aims to help enterprises save over 200 hours on tax procedures, is part of
the ministry's response to an order by the Prime Minister to cut the time
enterprises take to complete tax paperwork below 300 hours a year by the end
of 2014.
The average
Vietnamese business spends 537 hours each year dealing with tax procedures,
while the average time in other ASEAN member countries is only 171, according
to the World Bank. The Prime Minister urged the tax sector to reduce the
duration of tax procedures to that regional level in 2015.
Leading
urea maker suffers from input price rise, increased competition
PetroVietnam
Fertilizer and Chemicals Corporation (HOSE:DPM) posted a sharp drop in
profits in the second quarter this year due to an increase in the input price
and more fierce competition from domestic and foreign producers alike.
Despite stable
production, DPM’s net profit in the second quarter dropped sharply to
VND279.6 billion ($13.25 million) from VND908 billion ($43 million) in the
same period last year.
The first reason
for the decline in performance was the gas price increase. As required by the
government, starting on April 1 the Vietnam National Oil and Gas Group
(PetroVietnam)’s PVGas calculated the price of gas sold to DPM using a new
formula, which resulted in the price increasing to $7.4/million BTU from
$6.56/million BTU in 2013.
Cao Hoai Duong,
general director of DPM, said gas makes up 70 per cent of DPM’s total input
cost. If the price of gas rises by $1/million BTU, DPM’s input cost will rise
by VND400 billion ($19 million). Evidently, DPM’s Q2 financial statement
shows input cost of VND1.526 trillion ($72.3 million), up from VND1.218
trillion ($57.7 million) in the same period last year.
Another difficulty
DPM faces is surplus of urea. A report by the Vietnam National Chemical Group
(Vinachem) showed that Vietnam’s total supply of urea in 2013 was 3.25
million tonnes, including over two million tonnes produced by the four
domestic urea factories, namely Phu My, Ca Mau, Ha Bac, and Ninh Binh, and
1.2 million tonnes imported from China, much higher than the domestic demand
of 2.2 million tonnes.
The surplus exists
not only in
DPM currently holds
40 per cent of
Hung Nghiep Formosa
Ha Tinh Steel Limited Company (FHS) and its contractors in Formosa Plastic
Group’s steel and Son Duong deep-water seaport complex in the central
Formosa Ha Tinh
project - photo source TienPhong
During a first
check, the Ha Tinh People’s Committee discovered in some of the damage
reports submitted by firms that some of the facts didn’t check out, such as
the amounts of steel, wood, electrical wires and machinery stolen.
From the reports,
the province’s damage assessment committee valued direct damages to FHS and
its contractors at VND616.5 billion ($29.2 million), of which direct damages
to FHS were valued at VND13.5 billion ($640,000). FHS and its contractors
initially reported combined damages of VND4.934 trillion ($208.2 million).
Their reports did not segment out direct and indirect damages.
“The financials
submitted by the firms have not yet been checked,” said a representative of
the province, “as the firms have not yet submitted any documents to back up
their claims.”
The province has
asked FHS and its contractors to soon provide these documents, and asked FHS
to work with its insurance companies to determine which of the damaged assets
are covered and then report back to the committee.
Of the 86
contractors working on the $10 billion complex, 59 reported damages from the
riots that occurred in mid-May following
Ha Tinh has
punished 38 individuals for causing unrest, as well as retrieved some of the
stolen equipment. It has also taken a raft of measures to support damaged
firms, including asking Viet-Lao Vung Ang Port JSC to reduce its port rental
fees for FHS goods and the customs department to accelerate procedures for
the import of FHS machinery and equipment.
Despite given
chances to join Samsung production in Vietnam, local part suppliers are not
qualified to make even the simplest items of the 170 different types of parts
for which the South Korean company is seeking suppliers, a Ministry of
Industry and Trade official has admitted.
Samsung
“But electronics
associations and businesses, even those with up to 50 years of history, all
replied when asked about the list that they are unable to make such parts,”
Truong Thanh Hoai, deputy head of the ministry’s Heavy Industries Department
told Tuoi Tre (Youth) newspaper in an interview earlier this month.
The Vietnamese
businesses said they could not meet the technology specs and prices proposed
by the South Korean electronics giant, which operates a complex in the
What shocks Hoai
the most is that among the parts are simple items such as smartphone
chargers, USB cables, plastic cases, and earphones.
The official said
Vietnamese part suppliers missed a tremendous opportunity for failing to
qualify to be a Samsung partner.
“Samsung said they
need around 400 million chargers of various types a year,” he said.
“Provided that
Being the part
suppliers for global hi-tech giants such as Samsung will help engage
Vietnamese businesses into the global production chain and enhance the
country’s technologies, Hoai added.
The official
admitted that
“This increases
production costs and the possibility of a trade deficit, while reducing
product competitiveness,” he remarked.
Hoai said the
industry and trade ministry has submitted a draft decree on further
developing support industries to the government.
Under the plan,
centers for support industry development will be set up in the country’s key
economic areas.
The centers will
assist part suppliers in designing, testing, and checking product quality in
order to meet requirements from global hi-tech companies.
“We learned this
model from
Experts
optimistic of apartments market
The domestic
apartments market is expected to continue recovery by year-end and beyond
because of the increasing number of advantages for it in market and state
policies, experts said.
A view of the Sai
Dong Urban Area in Ha Noi's Long Bien District.
Savills Viet Nam, a
foreign property consulting service provider, revealed that in the second
quarter of 2014, an estimated 1,900 apartment units were sold in the capital
city, representing a 54 per cent quarter-on-quarter increase resulting from
strong sales in Grade B projects.
The average primary
price was approximately VND28 million per square metre, representing a 15 per
cent quarter-on-quarter increase.
In
Real estate traders
have continued doing business in the seventh lunar month in spite of the
belief about it being an unlucky month for activities such as moving into new
homes, getting married and opening new businesses.
A number of
companies are offering properties for sale this month, especially low-cost
apartments that have attracted customers. These include the Bac Ha Tower of
Bac Ha Construction and Trading Joint Stock Company, the CT9 apartment
building under the Van Phu Victoria project of Van Phu Investment Joint Stock
Company, the Ehome3 project of Danh Khoi A Chau Real Estate Joint Stock
Company, and the 8X Plus project of the Hung Thinh Property Company.
The Dien dan Doanh
nghiep newspaper quoted property expert Do Minh Duong as saying that a survey
on proposed amendments to nine real property laws was conducted at a meeting
of the National Assembly Standing Committee this month.
The National
Assembly is expected to approve the amendments to such laws as the Investment
Law, Enterprise Law and Housing Law.
Also, the Prime
Minister recently asked the Ministry of Natural Resources and Environment and
concerned ministries and sectors to implement land administration reform,
Duong added.
"These are
factors that have a direct effect on the domestic real estate market. If the
state implements these reforms, they will have a positive effect on the
market and boost the confidence of investors and customers who want to
purchase property," the expert said.
Property experts
agree that
In previous years,
domestic demand for real property remained high, resulting in a significant
number of successful transactions in the property market.
Based on official
figures,
In previous years,
land area for housing and apartment construction reached 80 million sq.
metres.
Therefore, demand
for housing and apartment construction remained high, and enterprises should
maximise every opportunity to develop property to meet market demand, Duong
said.
Experts noted that
in
Experts also noted
that domestic and foreign and investors had become more active in monitoring
developments in the real estate market.
Figures from the
Ministry of Planning and Investment showed that the country attracted US$5.7
billion in disbursed foreign direct investments (FDI) in the first half of
the year, showing a one per cent increase year-on-year. FDI poured into the
property sector accounted for approximately 10 per cent of the total, mainly
through merger and acquisition (M&A) activities.
Savill Viet
The Trans Pacific
Partnership Agreement should be signed soon and would support the growth of
the national economy and increase FDI flows into
"The New Land
Law, which took effect last July 1, allows foreign-invested enterprises to be
allocated land for residential housing projects. This regulation amendment is
expected to ensure transparency and offer equal opportunities to local and
foreign investors, making
"The market
continues to see residential development projects changing hands, including
the apartment sector, landed property sector and township projects. Investors
also have a strong appetite for operating assets with stable yields and lower
risks," Savill noted
"The interest
of Japanese and Korean investors, who have accounted for the majority of
M&A activities in the last two years, is expected to remain strong,"
the property consulting service provider said. "Besides, there is
growing demand from Singaporean and Taiwanese groups for both residential and
commercial office buildings. There will be continued activity in these
sectors over the coming months and in 2015."
COFICO
appointed to build Vista Verde
CapitaLand Limited
(CapitaLand) and its joint developer Thien Duc Trading-Construction Company
Limited (Thien Duc) just appointed Construction Joint Stock Company No.1
(COFICO) as the main contractor, to develop Vista Verde, a residential
project on a prime site in the heart of District 2 in
The signing
ceremony with COFICO, held at the project site on August 28, in
Le Dang Xu,
chairman and CEO of COFICO, said: “After the success of PARCSpring in
Comprising 1,152
high-end apartments across four 35-storey residential towers with spectacular
views of the
Policies
needed to make life at sea attractive
Maritime transport
enterprises have asked authorised agencies to create favourable policies to
encourage people to work on their vessels.
They described the
job as a dangerous occupation with a harsh working environment.
Vuong Ngoc Son,
general director of Vinaship JSC, said apart from professional skills, those
who worked as crew members are subject to long hours, a harsh working
environment and prolonged separation from their families.
Due to these
reasons, many countries had created special incentives on healthcare, social
welfare and preferential taxes for crew members, but
Son cited personal
income tax as an example. The current regulation imposes the same tax rate
for all labourers, even if they work at sea.
Deputy Director of
Vinalines Sea Transport Company Hoang Long agreed. He said crew members
should be exempt from tax due to the hardships they suffered.
In terms of food
allowances, Son said crew members were allocated VND93,000 (US$4.3) per day
for domestic routes, and VND170,000 ($8) for international routes.
However, crew
members were asked to pay 30 per cent of the total, and the rest would be
paid by their employers. The International Convention on Marine Labour
stipulates that crew members should be provided food free of charge while
they are working.
Son also said the
convention stipulated that each crew member should be given 30 days off
annually, which was higher than the regulation in
In reply to these
issues, the Viet Nam Maritime Administration said the recommendations made by
maritime transport enterprises were completely legitimate.
The administration
would make proposals to the Government to address these issues soon.
Figures from the
administration showed that last year, 32,000 crew members were licensed to
work aboard vessels. However, 60 per cent of them have left their boats due
to old-age or to find other jobs.
Solutions
sought for steel importers
Seeking to end
regulatory obstacles that might slow their growth, steel importers met with
government officials to discuss concerns about Circular
44/2013/TTLT-BCT-BKHCN.
The steel
importers, along with the Ha Noi Small – and Medium-sized Enterprises
Association (HAMESA), met yesterday with officials of the Ministry of
Industry and Trade (MoIT), Ministry of Science and Technology (MoST) and
other governmental agencies to review concerns they had about Circular
44/2013/TTLT-BCT-BKHCN.
Bui Quang Chuyen,
Deputy Director of the Heavy Industry Department under the MoIT said,
"During the implementation of the Circular, there were some problems
which have caused negative effects in the steel business."
According to officials
in the steel industry, major problems included losses caused by the time it
takes to receive quality certifications, as well as complicated procedures
and the requirements for businesses to work with combinations of governmental
organisations.
Mai Van Doi,
General Director of Viet Nam Boiler Joint Stock Company, said that their
import schedule had been unstable, resulting in the company having to
repeatedly register, which is costing them significant amounts of money.
He added that
Vietnamese enterprises also endured high risks due to trade frauds, but could
not afford to file international lawsuits against foreign companies.
Meanwhile, Trinh
Thanh Thuy, representative from International Son Ha Joint Stock Company,
said that the time required for processing paper work would result in heavy
losses for enterprises and has become a waste of efforts for management
agencies.
Additionally,
customs procedures, testing and accreditation processes should be reduced and
a set of corresponding standards should be developed to compare Vietnamese
steel products with those manufactured overseas, according to Thuy.
Nguyen Thi Nhan,
representative from Thai Hung Limited Company, said that remission
formalities, as well as random testing mechanisms, were unclear and complicated
for businesses and management.
She added that
steel importers had not yet received commitments of accountability, or a
listing of obligations, from governmental organisations.
In addition, Nhan
recommended that customs offices take responsibility for testing and reducing
the term of testing and evaluations of imported products at customs posts.
In response to
questions raised by steel-importing companies, Tran Van Vinh, Deputy General
Director of Quality Testing Head Office, said that his office had set up a
number of quality testing units to meet demands from businesses.
He suggested that
businesses not depend on a specific unit, but report violations that slow
progress.
Head Office
officials also said they were importing evaluation standards from overseas
organisations to speed the customs process.
Bui Quang Chuyen,
representative from MoIT, added that companies that have numerous import
schedules during the year could ask the ministry to confirm their plans, so
that confirmations would be completed within 20 working days.
Further, Dao Trong
Cuong, an expert from MoIT, said enterprises should comply with
administrative formalities to avoid wasting time and efforts.
Also, Tran Van
Binh, representative from Ha Noi Customs Office, said that the Office would
allow steel companies to transport products and materials to their warehouses
in Ha Noi.
The Office believed
that such actions would help companies avoid losses and expirations of goods
and products at customs post, he said.
Land-use
projects stuck in red tape
Enterprises have
not benefitted from the Government's Resolution 43/NQ-CP, issued more than
two months ago to reform the administrative procedures for investment
projects that involve land use.
The resolution was
issued in June, with focus on reforming administrative procedures for
land-use projects, to improve the business environment by reducing the
waiting time and costs for project investors.
With the removal of
12 types of administrative procedures and simplification of many others, the duration
for the implementation of administrative procedures for land-use projects was
cut by half from 155 to 865 working days previously, to 80 to 480 working
days.
This was good news
to investors during a difficult economic situation as the resolution was
expected to help ensure transparency and investors' rights, while the
concerned authorities could have a common voice for controversial issues such
as land auctions.
However, experts
said that many problems still need to be tackled to ensure that the resolution
is applicable in reality for improving the business environment.
According to Deputy
Director of HCM City Department and Planning and Investment Le Thi Huynh Mai,
the resolution failed to define specifically what land-use projects were,
causing difficulties during its implementation.
The resolution has
already repealed the investment certification procedures for land-use
projects which were not included in the provisory investment fields. But it
did not point out whether projects in industrial or export processing zones
needed investment certification, Mai added.
There were also
overlaps in investment procedures regulated by different laws, according to
Deputy Director of the central
The management of
investment projects is currently regulated by many laws, including Investment
Law, Construction Law, Land Law and Environment Law.
Chairman of NHS
Construction Investment Company Nguyen Hoai
In addition, the
lack of coordination among relevant authorities caused difficulties to
project investors.
According to Ngo Da
Tho, president of the Phu Yen Business Association, enterprises are forced to
spend a lot of time with different departments for the implementation of
investment projects, even as business opportunities pass them by.
He said any
disagreements between the concerned departments might cause the projects to
get stuck and investors would be forced to wait.
Chu Duc Luong,
chairman of the Phu My Group, said some projects had to wait for at least two
years to complete administrative procedures, while they needed only nine
months to complete construction and make the projects operational.
A tourism project
of the Sao Viet Company in
In order to assess
the implementation of the resolution, experts said the relevant departments
must coordinate with each other to simplify administrative procures for
land-use projects because just one problem could slow down the process.
Companies
set for share listings
The number of
companies filing to list shares on the stock exchange would rise significantly
next year, deputy general director of the HCM Stock Exchange Tran Thi Anh Dao
said.
One of the most
anticipated listings will be from banks which will be forced to list in 2015
under the direction of the Prime Minister in an effort to strengthen transparency
in the banking sector.
According to Dao,
many banks wanted to make share offering but had to postpone their plans due
to procedural difficulties such as high bad debt ratios which makes them
unqualified for listing, or if they were involved in a restructuring process
such as a merger or acquisition.
"With regard
to these cases, their listings may be delayed but ‘reluctant' banks that do
qualify to float must list shares on the stock exchange next year," Dao
told Dau Tu Chung Khoan (Securities Investment) newspaper.
She said
Techcombank had proposed a listing plan at its annual shareholders' meeting
this year, while others such as Nam A Bank, VPBank and LienViet PostBank were
considering suitable times for their debuts.
As well as banks,
other companies including Thong Nhat Production and Investment Joint Stock
Company, Van Dien Fused Magnesium Phosphate Fertilizer Joint Stock Company
and Thin Viet Securities Joint Stock Company are likely to be approved for
listing by the end of this year.
The exchange this
month received two initial listing registration documents from Quang Binh
Import and Export Joint Stock Company and Southern Fertiliser Joint Stock
Company.
In the first half
of this year, the southern exchange received only seven auctions and three
new listings, a very modest number compared to the previous years.
On the Ha Noi Stock
Exchange, several companies are also preparing to list shares by the year-end
including C.E.O Investment Joint Stock Company and Viet Thanh Electric Cable
Corporation.
According to market
insiders, the market size will expand substantially with more listings as
both stock exchanges are actively taking measures to compel public companies
to join the stock market.
Recent new listings
of Mobile World Joint Stock Company (MWG) and Central Hydropower Joint Stock
Company (CHP) have seen significant growth and this should act as a
confidence for companies to float their shares on the stock exchanges.
Raising capital
through the stock market has also shown positive signs, with total money
raised through this channel increasing to VND127 trillion (US$6 billion) in
the first six months of this year.
Automobile
imports surge despite slow growth
Figures from the
General Statistics Office (GSO) showed that the country imported 6,000 cars
worth US$120 million this month, its highest level since July 2011, when it
imported 7,000 cars worth $122 million.
The figures for this
month brought the total number of car imports in the first eight months of
the year to 37,000 units worth $801 million, representing a 71.6 per cent
increase in quantity and 90.7 per cent increase in value compared with that
of the same period last year.
The country's car
importation also maintained a momentum of growth in quantity in the last
three months, with 5,000 units in May, 5,800 in June, 5,900 in July and 6,000
in August.
"The
struggling economy seems to have no effect on car imports, with most brands
reporting better business in the country," said Luong Dinh Hung, General
Director of ASC Group, a prominent car importer in
Meanwhile, the Viet
Nam Automobile Manufacturers' Association (VAMA) said that it has readjusted
its annual selling rate target to 130,000 vehicles, an 18 per cent increase
over that of 2013, following better-than-expected sales results since the
beginning of this year.
The association,
which represents 21 car manufacturers in
Jesus Aria, VAMA
chairman, noted that sales from January to July this year also increased to
66,159 units, representing a 29 per cent year-on-year rise.
According to Duong
Dinh Giam, Director of Viet Nam's Industrial Policy and Strategy Institute,
the country is expected to go through a period of
"automobilisation" once annual per capita income rises above
$3,000.
"
IMF estimates show
the country's per capita income was $1,901 in 2013, the year that witnessed a
marked increase in the volume and value of
Ha Noi
needs logistics improvements
The capital city
has a high demand for logistics services but is currently facing a shortage
of professional purveyors.
At a conference of
the City's Department of Industry and Trade on Wednesday, Tran Nguyen Nam,
Deputy Head of the Ministry of Industry and Trade's Domestic Market
Department, admitted this and said majority of logistics centres here could
only cover an area measuring less than 10 hectares, meaning they could only
cater to the needs of local businesses.
In addition,
shortcomings in employee qualifications, management methods and the legal
framework, as well as the general course for development, are hampering the
sector's growth, he added.
Domestic businesses
are finding it difficult to compete with multinational groups or companies
backed by international investors. These businesses currently dominate the
logistics market and set themselves apart from domestic logistics services
through professional organisational structures and effective operations.
Official data
estimated the number of logistics purveyors in the capital city, including
State-invested, joint venture and private companies, to be about 800.
Foreign logistics
companies accounting for a mere two per cent of the total number but have an
80 per cent market share. Private companies account for a majority but are
mostly small-scale, with an investment capital of less than VND8 billion (US$377,500).
Nguyen Tuong, a
representative of the Viet Nam Logistics Business Association, pointed out
that the cost of logistics services in
Accoring to Nguyen
Thi Thu Ha of Dragon Logistic Company Ltd, infrastructure shortage is a major
factor behind the price of logistics services in
In addition,
changing customs procedures, coupled with informal charges, have reduced the
competitiveness of logistics firms, a participant said at the conference.
In response, the
city department is urging concerned agencies to develop policies that will
speed up the growth of logistics, promote effective workforce training
opportunities and build a comprehensive development strategy for the sector.
Logistics firms
were also urged to expand their operations, provide improved services at
lower prices and enhance cooperation with each other to expand market share
Tuong said that in
the short term, Ha Noi should initiate a logistics development project with a
vision to 2030, including concrete targets and points of action to turn the
city into a logistics hub for
Meanwhile, Giao
Thong Van Tai (Transport newspaper), a unit under the Ministry of Transport,
cited figures from the Viet Nam Register showing that the number of companies
currently operating in maritime transport have declined from 260 to 140 in
the past two years. .
During the same
period, the number of ships operating on international routes with a loading
capacity of 500 GT (gross tonnage) were also reduced by 73 per cent to 372.
This showed that
maritime shipping was in difficulty in recent years, according to Pham Thanh
Truong of the Viet Nam Register quoted by the newspaper.
The difficulty was
also reflected in the 22 per cent decline in the number of ships undergoing
annual quality inspection, at 797.
Investment
attraction far beyond expectations: HEPZA
The Export
Processing and Industrial Zone Authority (Hepza) on Tuesday announced the
total investment capital reached US$566.05 million as of August 19,
accounting for 103 percent of this year plan and up 48.28 percent over the
same period last year.
Hepza planned to
attract US$550 million investment capital this year and the number has gone
beyond the plan for four months.
Foreign direct
investment totaled US$286 million, up 0.56 percent over the same period last
year. Domestic sector invested VND5,892 billion (US$280.11 million), 188
percent year on year increase.
Seafood
association proposes dialogue on tra fish decree
The Vietnam
Association of Seafood Exporters and Producers (Vasep) has proposed the Prime
Minister and the Ministry of Agriculture and Rural Development to hold a
direct dialogue with tra fish businesses on a decree of tra fish
farming, processing and export.
The government
decree on tra fish farming, processing and export has been issued this year and
is implemented by the ministry in efforts to streamline the overdeveloped and
out of control tra fish industry.
Tra fish processing
and exporting companies in the Mekong Delta have raised objections against
some regulations in the decree.
Vasep has many
times suggested in writing that the Prime Minister and the ministry should
change some unsuitable regulations on the fish quality and procedures.
However, it has not received any respond yet.
Therefore, the
association one again proposed the Prime Minister to instruct related
agencies to organize a public dialogue between leaders from the Ministry of
Agriculture and Rural Development and tra fish enterprises in the Mekong
Delta in early September.
The talk will be
attended by representatives from the Ministries of Industry and Trade,
Finance, and Justice, the Government Office, the Vietnam Chamber of Commerce
and Industry and people’s committees from tra fish farming provinces,
according to the proposal.
The dialogue is to
prevent wrong information and incorrect evaluation about the businesses’
opinions and find reasonable measures.
According to the
decree, tra fish farming locations will be reorganized. By the end of next
year, all farms must meet VietGap quality standards.
Businesses are
required to register their export contracts with the Vietnam Pangasius
Association and get the association’s confirmation for customs clearance.
The decree
comprises a floor price regulation to prevent losses for farmers.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Hai, 1 tháng 9, 2014
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