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BUSINESS
IN BRIEF 30/10
Nearly 600
int’l importers register for Hanoi Gift Show
Nearly 600
international importers from the
On display at 550
pavilions during the event were handicraft and fine art products, interior
and exterior decorations, furniture, textile and embroidered products,
household utensils, gifts and jewelry..
A fair called “One
Village One Product” (OVOP) is held in the framework of the show. The fair
will introduce to visitors special and unique items from all Vietnamese
localities and
During the event
foreign importers will be invited to handicraft villages by the Hanoi
Department of Industry and Trade to seek for trade partners and facilitate
their business.
This is the fourth
year the Department conducted Hanoi Gift Show which is expected to become an
annual event for both local producers and foreign importers.
The fair will run
through to October 30.
Vietnam
seeks to boost aquacultural exports to Canada
Vietnamese seafood
products, especially frozen tra fish (pangasius) fillets, are amongst the
best-selling imported products in
According to Hua
Van Hao, President of Kien Fat Trade Company in
Meanwhile, Lenny
Wong, Executive Director of Ocean Parkers Inc., highlighted the large
potential on the local market for Vietnamese seafood products, adding that
his company imported and distributed 600 containers of tra fish and ba sa
fish all over
Wong also suggested
The Government
recently issued Decree 36/2014/ND-CP, which requires breeders, processors,
and exporters of tra fish to meet the Vietnam Good Agricultural Practice
(VietGap) standards or international standards such as GlobalGAP and
Aquaculture Stewardship Council (ASC), in a move to strengthen its exports to
large markets such as the EU and the
Government
bonds less attractive
The State Treasury
was unable to sell out VND5 trillion worth of government bonds at an auction
on the Hanoi Stock Exchange (HNX) on Wednesday despite higher coupons.
According to
VietnamPlus, the State Treasury offered VND2 trillion worth of five-year
bonds and VND3 trillion of 10-year bonds.
Some 17 members bid
for the five-year bonds with a total valid bidding volume worth nearly VND2.8
trillion. They offered coupons ranging from 4.6% to 6.5% per annum.
However, only
VND900 billion of five-year bonds were sold with a coupon of 5.01% per annum,
0.21 percentage point higher than the session on October 13.
Besides, only seven
members joined the auction for 10-year bonds and bid to buy over VND1.9
trillion of bonds at 6.19-7.25% per annum. Ending the session, VND900 billion
worth of bonds were sold at 6.3%, rising by 0.11 percentage point against the
previous auction.
Figures of HNX
showed that the State Treasury has mobilized over VND182 trillion from
G-bond issues since early this year.
Ocean Bank
offers preferential loans
Ocean Bank has set
aside VND1 trillion to make preferential loans available for corporate
clients in need of capital to expand their production and trading operations.
The low-interest
loans are available until March 31 next year.
The bank offers
six-month loans with an annual interest rate of 6.99% for the first three
months and loans of six-month to one-year terms with an interest rate of
6,99% per annum for the first six months.
Ocean Bank said the
credit package is part of the bank’s support program for enterprises this
year. Apart from preferential interest rates, the lender will launch
promotion programs and offer incentives to corporate customers.
Printing-packaging
sector forecast to grow 12% in 2015
The printing and
packaging industry is projected to grow by 10-12% next year thanks to the
fact that many firms are investing in technology to enhance product quality
and bolster exports.
A number of local
printing companies have been influenced recently by the global economic
crisis, the domestic economic difficulties and the development of online
communications, said Nguyen Van Dzong, chairman of the Vietnam Printing
Association. However, he told the Daily at the Vietnam International
Packaging and Printing Industry Exhibition 2014 (VNPrintPack) taking place
until this Saturday that the printing and packaging industry is still
expected to grow 7% for the whole year and 10-12% next year.
There are more than
1,000 printing and packaging firms nationwide earning total revenue estimated
at over US$1 billion a year, with the domestic market accounting for a lion’s
share, Dzong said.
Au Tung Mau, deputy
general director of Hung Nghiep Formosa Co., Ltd, told the Daily that the
company’s operation is running well this year with two production lines
producing BOPP films and two others for PVC films with maximum output of
5,000 tons and 500 tons a month respectively.
The local
consumption of these two types of film is faring better and forecast to enjoy
good growth next year. Mau’s company has 2,200 workers with half output for
domestic consumption and the other half for export, Mau added.
Hung Nghiep
Nguyen Thanh My,
board chairman of My Lan Group, said the group is acquiring more production
lines for printing materials using environmentally-friendly technology.
Given that local
printing and packaging companies are in fierce competition with Chinese
imports, the group is boosting its exports to the
If local firms want
to keep long-term business with customers from the U.S and
VNPrintPack
2014 opens in city
* As many as 230
local and foreign enterprises are attending Vietnam International Packaging
and Printing Industry Exhibition 2014 and Vietnam International Food
Processing Industry Fair now taking place until this Saturday.
The two exhibitions
are organized by Vinexad in collaboration with Chan Chao International
Company at the Saigon Exhibition and Convention Center (SECC) in HCMC’s
District 7.
According to the
organizers, this is a good chance for local and foreign companies to sound
out business opportunities and look for partners, and exchange and apply
advanced technology to printing and packaging industry.
Over 1,100
firms to join connectivity program
The HCMC Department
of Industry and Trade said more than 1,100 enterprises have put their names
down to participate in a supply-demand connectivity program to be organized
for companies in HCMC and other provinces next week.
Le Ngoc Dao, deputy
director of the department, said enterprises based in HCMC account for 847 of
the number and the rest from other provinces such as Long An, Tien Giang, Ben
Tre, Vinh Long, Ninh Thuan, Lam Dong, Ba Ria-Vung Tau, Hai Duong and Ha Tinh.
Distribution and
retail firms enterprises make up 782 out of the total number and the
remainder are manufacturing enterprises.
The one-day program
will feature the displays of products and the signing of deals between
suppliers and distributors. There will be seminars for producers to speak out
their challenges when selling products to distribution chains and for
distributors to make clear policies for goods purchases and discounts.
The conference will
help suppliers and distributors find cooperation opportunities to boost their
domestic sales and exports. It will create a chance for farmers and
agro-aqua-forestry cooperatives to find local and foreign distributors.
Through the event,
HCMC expects to secure supplies of goods with reasonable prices and meeting
food safety requirements for the kitchens in economic zones, industrial
parks, factories and schools in the city.
Dao said the city
would arrange a trade promotion trip to
Prices of
low-grade rice seen slipping
Prices of medium and
low-grade rice are forecast to decrease in the coming time as their supply
will increase strongly while demand will stay the same on global markets,
according to economic expert Nguyen Duc Thanh from the
Thanh, who is also
head of the paddy and rice research team of the
Thanh said paddy
output and yields of
Low-grade rice now
accounts for over 40% of
Luong Van Tai, a
farmer in An Giang Province, said paddy output in the Mekong Delta province
has increased but prices have stood at around VND5,000 per kilo for years.
But prices of input materials such as fertilizer, pesticides and paddy seeds
have kept rising.
Thanh said local rice
exporters will face fiercer competition on global markets when supply of
medium and low-grade rice surpasses demand, and this will push down paddy
prices on the domestic market.
Some policies
encourage farmers to produce low-grade paddy. For example, Decree 109
containing conditions for rice exports prevents a number of firms from
producing and trading specific rice products, which can bring about high
profits for both exporters and growers, Thanh said.
Agronomist Vo Tong
Xuan told the conference that the decree should have particular regulations
for enterprises to tap the niche market by exporting high-grade rice and
specialty rice.
It is important to
create a level playing field for enterprises in order to improve the brand,
quality, diversity and prices of
Consumer
confidence slightly softer in October
The Vietnam
Consumer Confidence index announced by ANZ Bank and Roy Morgan in October has
fallen slightly by 0.3 percentage point from the previous month to 134.7,
primarily driven by survey participants’ falling confidence in the next 12
months.
In terms of
personal finances, 53% (down five percentage points month-on-month) of
Vietnamese respondents expected their family will be better off financially
this time next year compared to just 7% (up two percentage points) opting for
worse off financially, ANZ said in a report released on October 22.
Of the respondents,
33% (up two percentage points) said their families are better off financially
than a year ago compared to 23% (up two percentage points) who said their
families are worse off financially.
Considering the
Vietnamese economy, 51% (down three percentage points) thought
In addition, 61%
(up one percentage point) predicted
Meanwhile, 42% (up
two percentage points) said now is a good time to buy major household items,
the highest for this indicator since January 2014, compared to only 14% (down
seven percentage points) who said now is a bad time to buy major household
items.
Glenn Maguire, ANZ
Chief Economist for
“As we previously
highlighted, wealth effects from the equity market are a key determinant of
consumer confidence in
In addition, with
consumer price inflation having continued to soften recently, price savvy
consumers are now recognizing the present as a good time to purchase a major
household item.
As the survey
showed, 42% of Vietnamese, the highest level so far this year, believed now
is a good time to purchase a durable item.
Simplified
licensing could bring home prices down
Home prices are
quite low at the moment and could not be lower but investors believed they
could bring down prices further if the licensing procedures for housing
development projects are streamlined, according to experts.
Economic expert Vu
Dinh Anh told a seminar on real estate recovery in HCMC on Tuesday that the
current house prices are too low and that land prices may double next year,
pushing up the investment of housing projects.
Nguyen Vinh Tran,
general director of Nam Long Investment Company, said home prices could
decline if land prices drop but it is difficult for the company to lower
house prices.
However, Nguyen Van
Duc, deputy director of Dat Lanh Real Estate Company, said it is possible for
enterprises to cut prices by around 20% if they carefully select building
materials and apply high technology to reduce investment. Besides, they will
be able to slash another 10% of their total costs if administrative
procedures are simplified.
Complicated
procedures have pushed up investment costs, Duc pointed out.
According to Tran
Trong Tuan, director of the HCMC Department of Construction, it takes a
company 21.5 months to start work on a small-scaled property project and 26.5
months for a big project from the date of applying for a construction
license.
Le Huu Nghia,
director of Le Thanh Construction and Trading Company, said the company has
developed eight projects and none of them was licensed in fewer than 30
months. Some projects even took the company up to four to five years.
Nghia shared Duc’s
viewpoint, saying that if administrative procedures are processed quickly,
enterprises would spend less time on their projects and make better profits.
Tuan said the
department has tried its best to reduce administrative paperwork in response
to property enterprises’ complaints.
Tuan said the
licensing of a property project involves not only the department but also
other departments. He also said some enterprises are not financially capable
or do not comprehend relevant regulations.
“We are willing to
work with enterprises on reviewing administrative procedures concerning the
issuance of construction licenses. If it is our fault, we will admit it,”
Tuan said.
Many energy
centers ineffective
Although there are
more than 14 energy saving promotion centers and over 40 centers for
industrial promotion established nationwide to support power efficiency, half
of the total are performing ineffectively as they just do jobs concerning
promotion of energy saving.
Trinh Quoc Vu, head
of the Science Technology and Energy Conservation Department under the
Ministry of Industry and Trade, raised the point at a recent conference on
energy in the Mekong Delta
Vu said such
centers were opened to advise local governments on their energy audit and
efficiency policies with an aim to ascertain how much power is wasted and
find solutions to the problem so that enterprises can adopt proper measures
to save power and gain more profit.
In reality, half of
the centers have actually helped companies make changes to save as much
energy as possible and the remainder simply introduces the benefits of saving
power for locals and firms via issuing leaflets. The reasons for the
ineffective centers are that they lack experts in power technology and
equipment.
Huynh Kim Tuoc,
director of the Energy Conservation Center HCMC, pointed out a lack of
finance as one of the causes of the situation. He said many banks have not
been able to work out evaluation criteria for the loans provided for
enterprises to execute energy-saving plans.
Fortunately,
Vu said the
Ministry of Industry and Trade will set up a fund worth US$200 million lent
by the World Bank in 2016 to back enterprises’ efforts to change technology
in order to save energy.
Brokerage
firms fare well in Q3
A number of
securities enterprises reported positive earnings results in the third
quarter of this year thanks mainly to the strong rally of the local stock
market.
HCMC Securities
Corporation (HSC) obtained over VND640 billion in revenue in
January-September, including VND216.7 billion in the third quarter, surging
by 47% and 52.8% respectively against the same period of 2013.
Of the
VND640-billion revenue between January and September, HSC earned VND223
billion from brokerage and services, VND177 billion from securities
investment, VND9.8 billion from advisory services and nearly VND230 billion
from others.
The enterprise’s
pre-tax profit in the first nine months rose 71% year-on-year to VND409.8
billion, including VND134.6 billion recorded in July-September. Its after-tax
profit exceeded VND320 billion, jumping by 78% year-on-year.
At an analyst
briefing early this week, HSC explained the difference between the growth of
before- and after-tax profit resulted from a corporate income tax reduction
from 25% to 22% this year.
At the end of the
third quarter, the enterprise fulfilled 86% and 94% of this year’s revenue
and after-tax profit targets respectively.
In the third
quarter, HSC ranked second on the Hochiminh Stock Exchange in terms of
brokerage market share with 12.34% after Saigon Securities Inc. (SSI) with
13.27%. But the firm ranked first on the Hanoi Stock Exchange with 8.37%.
Bao Viet Securities
Company (BVS) posted revenue of VND78.6 billion, up 52.8% year-on-year.
Explaining the
strong rise, BVS said in a statement sent to the Hanoi Stock Exchange that
the improvement of the stock market sent trading volume and value up strongly
in the third quarter. Its after-tax profit also gained 30% to nearly VND28.6
billion in the period.
From January to
September, BVS obtained around VND218 billion in revenue and VND90 billion in
after-tax profit, up 42.4% and 14.5% respectively compared to the same period
last year.
IB Securities
Company (VIX) saw its after-tax profit in the third quarter soar 251%
year-on-year to VND13.5 billion due to better proprietary trading.
Thanks to the
strong rise of the market, VIX attained VND20.6 billion in proprietary
trading revenue compared to over VND1.9 billion in the same period of 2013.
The firm also earned around VND2 billion from advisory and issue guarantee
services compared to zero earnings in 2013’s third quarter.
Its revenue jumped
325% to VND24.3 billion in the period while its operating cost leapt 290% to
VND7.4 billion due mainly to rising spending on proprietary trading and
manpower. The firm still obtained good profit as its revenue growth was
higher than that of operating cost.
Despite the good
business results, experts warned that securities firms are still facing risks
due to margin loans extended to investors.
There were still
enterprises with poor business results in the period. For example, Wall
Street Securities Company racked up losses of VND21.4 billion due to rising
operating cost and share price decline provisions.
AIA
Life insurer AIA
Vietnam reported its new business premium growth of 92% in the third quarter
of this year over the same period last year.
Its annualized new
premiums in the period increased by 24% versus the same period last year. The
firm also boasted a new milestone in August when it reported annualized new
premium sales of over VND111 billion in a single month.
Stephen Clark, CEO
of AIA Vietnam, said the company has focused on improving the quality of
sales advice, services and products in this increasingly competitive life
insurance market.
AIA Vietnam is also
continually improving in important areas such as sales compliance, ethical
behavior and adherence to regulatory guidelines and rules.
Automakers
report surging demand
Automakers in the
country are running their factories at full capacity to meet surging demand,
which is in stark contrast to somber forecasts made earlier this year.
The Japanese
automaker has sold 6,300 Vios 2014 units since this model made its debut in
the first quarter of this year but there are now more than 1,700 firm orders
for the company to fulfill.
The number of Yaris
2014 units sold in June-September was 908, tripling the average sales of the
old Yaris model.
In the first nine
months of this year, Ford
Jesus Metelo Arias,
general director of Ford
The customers who
have placed orders for Transit, Ranger and EcoSport models have to wait until
this December to take delivery.
Honda Vietnam has
had more than 1,000 orders for its compact City car, which doubled the
company’s earlier estimate for the model introduced one month ago.
Truck sales are
also faring well. Buyers of Isuzu
According to the
Vietnam Auto Manufacturers Association (VAMA), the nation’s auto sales
amounted to 106,700 units as of the end of last month, rising 39% against the
same period last year with sedans and trucks accounting for 40% and 36%
respectively. The association estimated the whole year’s sales at nearly
145,000 units.
Max speed
sparks concerns
Several transport
experts have expressed grave concerns over a decision by the Ministry of
Transport to revise up maximum speeds on certain expressways, such as 120kph
on HCMC-Long Thanh road.
Relevant agencies
should thoroughly check safety conditions on such roads before approving the
new maximum speeds as designed on such roads, they said.
Pham Sanh, an
expert in transport, said he supported the ministry’s move to raise the speed
limits on expressways, but he was concerned about the current situation of
traffic on expressways, which to a certain extent is still chaotic.
Before allowing for
an increase of the speed limit to 120kph, the Transport Ministry should
conduct a study on traffic safety when vehicles drive at such a high speed,
Sanh told the Daily.
“Currently, safety
issues on expressways are still not well controlled. The accident between a
coach and a watering vehicle on the HCMC-Trung Luong Expressway that killed
seven people in April indicates this problem. In my opinion, the max speed
should not be raised to 120kph for now if a safety study has yet to be
conducted,” he said.
Sanh suggested that
there should be more regulations on vehicles passing each other, and the
speed should be regulated the same on different traffic lanes of the same
expressway.
Vu Xuan Hoa,
director of Bach Khoa Construction Consulting Co., said the transport ministry’s
move to allow for a maximum speed as designed for certain expressways is
reasonable. However, further calculations should be made first.
In addition,
expressway management agencies must also ensure the highest quality of the
road. A small hole on the expressway can trigger a serious accident when
vehicles run at 120kph, Hoa said.
Previously,
authorities allowed for the maximum speed of 120kph on the HCMC-Trung Luong
Expressway, but later reduced it to 100kph after several tragic accidents on
the road.
As covered in the
Daily on October 21, the Transport Ministry has just revised up the maximum
speed to 120kph on HCMC-Long Thanh in the south and Thang Long Boulevard in
The Indian
government is calling for Vietnamese enterprises to invest in the world’s
second most populated country as part of a campaign entitled “Make in
The Consulate
General of India in HCMC last week held a function to promote the campaign
initiated by Indian Prime Minister Narendra Modi to develop the country into
a global manufacturing hub.
Under the
initiative, local and foreign investors are encouraged to establish firms or
joint-ventures to turn out products in
Smita Pant, Consul
General of India in HCMC, told the event that “Make in
The campaign aims
to create a friendly environment for investors with transparent procedures.
In a few years to
come, stronger ties between
The potential for
enterprises of
A memorandum of
understanding on twinning HCMC with Mumbai is under discussion. An Indian
bank is also making great efforts to open a branch in the city.
“We call for
investors to look at
Mohan Ramesh Anand,
chairman of the Indian Business Chamber in
The Indian food
processing industry is estimated to reach US$320 billion next year.
Therefore, Anand urged
Vietnamese
enterprises have invested more than US$8 billion in over 500 overseas
projects. Apart from the traditional markets of
However,
No State
money for bad debt
The Government has
told the Ministry of Planning and Investment to withdraw its proposal for
using the State budget to settle bad debt of State-owned enterprises (SOEs).
In an urgent
document sent to the ministry, the Government Office said Deputy Prime
Minister Vu Van Ninh has ordered the ministry to take back the proposal for
using the State budget to finance bad debt of SOEs.
Earlier, the
ministry submitted a draft report on the restructuring of public investments,
SOEs and the banking system to the National Assembly Standing Committee in
mid-October with the proposal written on page 67 of the report.
The suggestion
immediately sparked public concerns that it is not fair to use taxpayers’
money to assist loss-making and inefficient businesses run by the State.
There are about
1,000 SOEs in operation. Total debt of this sector is estimated at VND1.600
trillion, equivalent to US$80 billion.
Many Finnish
companies have expressed their strong interest in cooperating with HCMC in
implementing urban area projects, especially the Thu Thiem New Urban Area in
District 2, the Finnish Minister of Employment and Economy said.
Jan Vapaavuori told
a conference on Finland’s hi-tech solutions for a smart city in HCMC on
October 21 that in addition to urban area projects, Finnish firms want to
invest in wastewater treatment as well as bridge and road development in the
city.
HCMC vice chairman
Le Manh Ha said with a population of over 10 million, the city is grappling
with a host of challenges involving environmental pollution, traffic
congestion and flooding.
Various solutions
have been deployed, including the application of technologies in traffic
management, but the results are still limited, Ha said.
Vapaavuori said
after reaping success in the northern city of
Attending the
conference in HCMC on October 21 were representatives of 23 Finnish
enterprises operating in various sectors, including information techonology,
telecommunications, hi-tech and education.
At the conference,
Finnish firm Viope and Vietnamese company Gsoft clinched a cooperation
agreement in information technology.
On Monday, Minister
of Transport Dinh La Thang and the Finnish minister signed an agreement on
air transport between the two countries. The pact is about transport rights;
the airlines chosen to operate services between the two countries; taxes and
charges for airlines, competition and cooperation to ensure aviation
security.
The 26-article
agreement is expected to promote economic, trade and tourism ties between the
two nations once it takes effect.
Thang said the
Government has indentified infrastructure development, particularly in transport
as one of the breakthroughs for
Thang said with its
technology and science strengths,
Caesar
Caesar Vietnam
Sanitary Wares Joint Stock Company has inaugurated a showroom featuring
hundreds of sanitary products at
The showroom having
an area of over 600 square meters displays a wide range of items like
washbasin, automatic hand dryer, bathtub, urinal and other bathroom
accessories. The facility also showcases a new collection of items applied
with modern technologies such as water-saving urinal and electronic toilet.
According to David
Chen, deputy general manager of Caesar
Taiwan-invested
Caesar
Can Tho to
have credit guarantee fund for SMEs
A credit guarantee
fund for small- and medium-sized enterprises (SMEs) will come into operation
in Can Tho City on December 1 this year, according to the city’s vice
chairman.
Nguyen Thanh Dung
told a meeting with commercial banks in the Mekong Delta city on October 21
that the city government will be responsible for managing this fund.
Tran Quoc Dien,
director of the fund, said this fund has initial chartered capital of VND60
billion sourced from the city’s budget. Can Tho needs support from banks to
raise the amount to VND100 billion next year.
In response to
Dien’s suggestion, most of the banks at the meeting agreed on contributing
capital to the fund but did not detail their contribution ratios.
Dien said the fund
will provide guarantees for SMEs to take out bank loans for their production
and trading activities.
Dung said 90% of
the firms in the city are SMEs and find it hard to gain access to financing
sources. “Therefore, the fund will support enterprises’ production plans
which in return help create more jobs for locals and the city government
increase budget collections,” he said.
Dung said the
management of the credit guarantee fund plans to seek more money to raise its
charted capital to VND200-300 billion to assist more companies.
Equitization
of 432 SOEs to finish next year
The Government has
pledged to speed up a national equitization scheme to ensure that 432
State-owned enterprises (SOE) will go public by the end of next year as
scheduled.
Presenting a report
on socio-economic development in 2014 and tasks for 2015 at the eighth
session of the 13th National Assembly in
Besides, the
Government has focused more to SOEs’ divestments from non-core business
operations, improvement of business governance and efficiency, and removal of
difficulties during the equitization and divestment processes.
Between January and
September this year, 71 enterprises went public (compared to 74 firms last
year) with 35 launching initial public offerings (IPO) on the local stock
market. The value of 123 other candidates was determined and around 200 SOEs
are expected to go public this year.
Among the 432 SOEs
entitled to the equitization scheme, 368 companies have set up steering
committees, 257 firms are assessing their value and 123 firms have got
decisions to publicize their value.
The report said
most SOEs are profitable, contributing more to the State budget.
Last year, total
assets of State-owned groups and corporations increased 10.4% against the
previous year, equity up 15% and revenue up 5%. According to the report, 101
out of 108 enterprises reported combined pre-tax profit advancing 21%.
In the first half
of 2014, SOEs’ revenue, pre-tax profit and tax payment met 50.5%, 57% and 54%
of the year’s respective targets.
In 2015, the
Government aims to finish the equitization of 432 SOEs and continue divesting
capital out of the sectors that the State does not need to hold a majority
stake.
The Government will
also encourage private investment in production and trading, support the
development of private companies and cooperative economy.
Ministry,
firms at odds over housing inventory
The property market
has shown signs of warming up in the final months of the year; however,
statistics on the inventory volume are still a mystery due to different ways
of calculation.
According to recent
statistics of the Ministry of Construction, the value of property inventory
was VND82.295 trillion as of August 20, down VND12.163 trillion (12.88%)
against December.
There are still
around 17,000 unsold apartments, equivalent to VND26 trillion, while the
unsold land lots total over 8.7 million square meters worth VND28.5 trillion.
However, the owner
of a big property company refused to comment on the reliability and accuracy
of such figures, simply saying the ministry’s calculation is different from
the company’s. While the ministry reports declining inventory over the time,
housing developers are not that optimistic.
Both property
investors and market observers believe there is huge inventory, mainly at
high-end projects.
Nguyen Van Duc,
deputy director of Dat Lanh Real Estate Company, proved this point, saying
HCMC alone currently has up to 1,000 property projects which have been
developed or are underway.
According to Duc,
only 50 to 60 of those projects are offering their products for buyers and
earning good sales while others whose combined value may be worth trillions
of dong are standing still.
The latest
statistics of the HCMC government do not indicate positive findings either.
There are currently over 1,400 housing projects in HCMC covering a total land
area of over 11,800 hectares and comprising more than 506,500 units.
Nevertheless, only 426 projects have been finished, 201 others are under
construction and up to 689 projects have been suspended.
Duc said suspended
and unfinished projects should be counted as inventory. Besides, investors of
such projects had to take out bank loans and the inventory value picks up 12%
a year equivalent to the normal lending rate.
Meanwhile, Doan Chi
Thanh, general director of Hoang Anh Sai Gon Real Estate Company, said a
housing product is considered inventory when the investor finishes building infrastructure
of a land lot project or foundation of an apartment project under the
existing regulations.
Thanh admitted
property inventory has declined from last year’s quarter three and good signs
are seen in the low-end housing segment. However, there is no scientific
basis to rely on the ministry’s inventory figures, he added.
Pham Thanh Hung,
general director of Cen Group in
Developing a
property comprises several phrases, and if each sides view inventory in
different phases, inventory statistics are different, Hung said.
Gov’t aims
to cut bad debt ratio to 3% next year
The Government is
planning to slash bad debt in the banking system to around 3% next year,
according to its web portal at chinhphu.vn.
In a report on
The Government has
basically restructured weak banks with seven credit institutions merged into
others. Commercial banks have improved financial capability and secured
network safety.
Between January and
September, Vietnam Asset Management Company (VAMC) bought over VND50 trillion
worth of bad debt, taking to VND90 trillion the total value of bad debt it
has purchased.
Meanwhile, banks
had set aside VND78.5 trillion credit risk provisions as of August to continue
dealing with bad debts.
Next year, the
Government will continue the restructuring of the banking sector and complete
the operation mechanism of VAMC.
HSBC
projects robust export growth for VN
HSBC Bank predicted
that
In its Asia
Economic quarterly report released on October 20, HSBC said after years of credit-intensive
growth with most capital channeled into the inefficient State-owned sector,
the country is taking a breather and focusing on a more sustainable growth
strategy – exports.
Despite the global
slowdown,
“We expect export
growth of 15.9% this year, taking the export-to-gross domestic product (GDP)
ratio to 81.4%. The economy will likely expand by 5.7% this year and
accelerate slightly to 5.8% in 2015,” the bank said in the report.
Some good news for
the export sector is ahead at the end of 2014 and next year. Negotiations on
the free trade agreement between the European Union (EU) and
Firms that want to
take advantage of the country’s trade liberalization policy are setting up
shop and increasing foreign direct investment (FDI) inflows. Agricultural
exports are also gaining momentum although more work is needed to raise the
added value of farm produce rather than competing on pure volume.
HSBC also mentioned
other positive factors in the report, including the Government’s improving
fiscal management. In the past decade, the economy suffered from too many
wasteful projects that did not improve productivity.
Public projects are
increasingly more scrutinized and more demand-driven. The Government is
focusing on key infrastructure projects to alleviate bottlenecks such as
highways and distribution.
However, a high
non-performing loan ratio and the still inefficient State-owned sector remains
a concern.
The State Bank of
Vietnam (SBV) will likely accelerate restructuring banks towards the end of
the year and next year, although the reform will probably increase the SBV’s
supervisory capability within the regulatory framework.
The Government
plans to boost the equitization of key enterprises in the last quarter of the
year.
With low global oil
prices and stagnant domestic demand, price pressures are subdued. Coupled
with this, a favorable base effect will likely push inflation to a new low in
the fourth quarter.
Therefore, SBV
would have room to cut the open market operations (OMO) rate by another 50
basic points to 4.5%, HSBC projected.
Agricultural
firms hard to access bank loans
Agricultural
enterprises have voiced a series of difficulties in accessing bank loans as
apart from the challenges caused by the economic slowdown, they are facing
more weather and market risks than those in other sectors.
Nguyen Thi Hang,
general secretary of the Vietnam Beekeepers Association, told a forum on
agricultural enterprises in
Vo Quang Huy,
deputy chairman of the My Thanh Shrimp Association in the Mekong Delta
Huy suggested that
the central bank should have appropriate policy to support shrimp farms.
Tran Van Chien,
head of Co Dong Livestock Cooperative in Son Tay District of Hanoi City, said
the livestock sector has struggled with many woes in the past three years,
leading to many farms shutting down. It is very hard for farm owners to take
out bank loans to resume operations.
“Our members need
to invest billions of dong in their farms but cannot borrow money from banks.
Banks only lend those already having contracts to sell their products to
livestock companies. This forces farm owners to be employees of foreign
firms,” Chien said.
Dao Cong Thang,
director of Agricare Vietnam Co. Ltd., said his company has not been able to
take out any bank loans or benefit supporting policies from the Ministry of
Agriculture and Rural Development.
Thang also bemoaned
policy changes that put agricultural firms on tenterhooks. “Policies change
so quickly that we do not have enough time to respond. Our violations are
inevitable and too many fines make our life very difficult,” Thang
complained.
TPBank
launches mobile payment service
Tien Phong Bank, or
TPBank, on October 20 introduced its mobile payment service to small and
medium-sized enterprises (SMEs) and stores.
TPBank will provide
users with a device to connect to smartphones and to enable cell-phones to
operate as points of sale (POS). Customers will have to deposit VND1.5
million to borrow the device and install software to their phones.
Unlike a
traditional POS terminal, the new service does not require minimum monthly
revenue. Usual POS service forces users to obtain a minimum transaction value
of around VND50 million a month, so it is only suitable to large companies
and stores.
TPBank is the
second bank in
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Tư, 29 tháng 10, 2014
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