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BUSINESS IN BRIEF 18/12
Authorities mitigate impact of falling oil price to State
budget
The government will implement comprehensive measures to meet
next year's annual state budget collection target of VND911.1 trillion
(US$42.774 billion), notwithstanding the insignificant effect of the global
oil price decline.
Some experts are concerned about the reduction of the state's
budget next year as the export value of crude oil, which has fallen by 30% to
a four-year low of roughly $60 per barrel, contributes significantly to the
nation's coffee.
However, Deputy Finance Minister Do Hoang Anh Tuan said that
as of 2014, the state coffer has not been heavily dependent on the
fluctuation of the world's oil price due to a shift in the state's budget
collection sources.
Tuan explained that the oil export revenue is estimated to
account for only approximately 10.2% of the total state budget in 2014
compared with the previous 20–25% rate.
State budget collection from domestic production makes up more
than 70% of the total budget, which diminishes the gravity of the impact of
oil export collection.
Dr. Tran Hoang Ngan, a member of the National Assembly's
Economic Committee, also expressed continued optimism despite the predicted
oil price fluctuations, saying that the gains will be larger than the losses.
Therefore, an ongoing decline in oil prices will result in
lower prices of petroleum products. In turn, this will help enterprises cut
back on their production costs.
Hence, enterprises can expect higher profits, which will
consequently add to their taxes to be paid to the state coffer. Ultimately,
this will help increase the state's revenue.
Finance Minister Dinh Tien Dung also said that the ministry
will focus on eliminating obstacles and creating favourable conditions for
firms to assist them in boosting production and business.
The measure will create a long-term collection source for the
state budget, Dung said. He also explained that the firms will only be able
to meet their tax obligations when their businesses and production
performances are good.
Moreover, the finance ministry has worked closely with other
relevant departments and agencies to employ relevant measures to guarantee
the achievement of the state budget collection target, Dung said.
One of the measures is to increase the collection of tax
arrears, which has reached more than VND60 trillion (US$2.816 billion) thus
far.
To increase the state budget collection next year, experts
also recommended that the government should effectively manage state budget
collection and reduce spending, including administrative and regular
expenditure as well as public debt payment.
Strict punishment should be meted out against those
responsible for improper, wasteful and ineffective expenditures, the experts
asserted.
Chile introduces market potential in Vietnam
Although Vietnam-Chile Free Trade Agreement came into effect
as from January 1, 2014, investment and trade cooperation between the two
countries still faces obstacles.
Together with the Governments’ determination, the business
communities from the two countries should pay more effort to lift bilateral
trade and investment cooperation into a new height.
These statements were made by Nguyen The Hung, Vice Director
of the Vietnam Chamber of Commerce and Industry (VCCI) branch in HCM City at
December 16 seminar to introduce Chile market.
Hung said
Nguyen Thanh Quang, a representative from Chile Consulate
General in
Vietnamese businesses can invest in
Over the past three years,
In the first ten months of this year, it grossed more than
US$710 million, of which
EU supports enforcing Competition Law
The Vietnam Competition Council (VCC) and the European Trade
Policy and Investment Support Project (EU-MUTRAP) reviewed ten years of
implementing the Competition Law in the country and lessons learnt at a
seminar in
EU-MUTRAP Technical Assistance Team Leader Claudio Dordi said
the Competition Law has been implemented over the past 20 years and proved
effective. Notably, it has played an important part in Free Trade Agreements
(FTAs) negotiations among concerned nations.
Mr Dordi added that
So far,
Dr. Tran Mai Hien, VCC Director General emphasised businesses,
especially exclusive enterprises need to possess detailed knowledge of what
should be done to avoid violating the Competition Law.
Dr Trinh Minh Hien, an EU-MUTRAP expert, stressed that state
management agencies should limit the fields of business with the involvement
of exclusive enterprises. Violations should be publicised and handled as soon
as possible to help businesses to create a healthy competition environment in
The Competition Law was issued on December 3, 2004 with the
purpose of restricting unhealthy competition.
The Vietnam Embassy on December 15 sponsored an international
marketing seminar in
Speaking at the seminar,
The two-way trade turnover surpassed US$1.8 billion this year,
Lan said, adding that this represents a ten-fold increase over the past
decade, yet the two nations have barely scratched the surface of their
potential.
During the seminar, representatives from the Association of
Professional Promotion of Mexico (AMPPRO) and other businesses spoke highly
of
The representatives said the gap between the nations in
distance and in cultural understanding are the biggest hindrances for Mexican
businesses optimally realizing trade and investment opportunities.
To overcome these obstacles, Mexican businesses pledged to
seek new outlets in the Vietnamese market with the support from the Vietnam
Embassy and expressed hope that
After hearing reports on investment and tourism opportunities
in
On the occasion, the Vietnamese embassy also held a photo
exhibition on Vietnamese culture and people to introduce Mexican people to –
dynamic
UAE a leading trade partner for Vietnam
The United Arab Emirates (UAE) is one of
Deputy PM Phuc, who is on an official visit to the UAE, made
the statement at a Vietnam-UAE economic forum held in Dubai that was attended
by hundreds of governmental dignitaries and entrepreneurs from the two
countries.
In the last decade, trade between the two countries has
exploded more than 63 fold Deputy PM Phuc said and cooperation has expanded
across the board in all areas of politics, diplomacy, economics and culture.
As of November 2014,
Deputy PM Phuc said he hoped that the forum would help
businesses from the two countries find yet even more areas for expanded
cooperation for mutual benefit to further stimulate trade and investment
between them.
Also on December 15, the Deputy PM took time to visit with
Overseas Vietnamese (OVs) at the Vietnamese Embassy in
Vietnam- Algeria bilateral trade aims for US$1 billion by 2020
Speaking before representatives from around 30 Vietnamese and
Algerian businesses, the ambassador highlighted the potential for economic
cooperation between the two nations, particularly in construction,
agro-fishery product processing, consumer goods, pharmaceuticals and tourism.
In the first 10 months this year, Vietnam earned nearly US$315
million from export to Algeria, including more than US$116 million worth of
coffee and US$23.6 million worth of rice. However,
Ambassador Vu The Hiep also urged both sides’ enterprises to
further their cooperation in labour, as
Commercial Counsellor Nguyen Van Mui briefed the participants
on economic development and the international integration process in
Director of the Department of International Relation under the
Algeria Chamber of Commerce and Industry (CACI) Belhoul Ouiahiba introduced
Vietnamese businesses to investment opportunities in
Participants proposed that the two Governments sign agreements
on two-way trade, labour cooperation and investment as well as hold more
trade and investment promotion activities to help their businesses find
partners and opportunities.
Wood product exports expect to grow next year
The export value of wood products is forecast to reach 7
billion USD next year, said General Secretary of the Vietnam Timber and
Forest Products Association (Vifores) Nguyen Ton Quyen.
This is five years earlier than the target set in the national
forestry strategy in the 2006-20 period, as approved by the Prime Minister.
Quyen added that the forestry industry expects to increase
exports when
According to the Ministry of Agriculture and Rural
Development, the eighth joint expert meeting and fourth negotiation session
on the VPA/FLEGT recently took place with the aim of ensuring that all
Vietnamese timber and timber products that are exported to the European Union
are legally sourced and produced. The two sides showed their willingness to
complete the negotiations over the FLEGT-VPA in 2015.
Quyen revealed that the forestry industry is also considering
increasing its previous export target in the 2006-20 national forestry
strategy by 5 billion USD to touch 12 billion USD by 2020.
If suitable measures and effective support policies are taken,
the annual export turnover of the industry will likely reach 15 billion USD
to 20 billion USD in the next 10 years, Quyen said.
However, he added, the scale of the world demand for wood
products is roughly 300 billion USD per year, which means
This year, Viforest estimated that the export of wood products
will reach 6.2 billion USD, five times higher than that of five years ago.
Exports to the main markets, such as the
Experts attributed the preference for Vietnamese wood products
in large markets to their good quality and competitive prices.
They said that many importers have turned to
Vietnam is the sixth largest exporter in the world and the
second largest exporter of wood interior decoration products, claiming nearly
four percent of the world market share.-
Tra fish exporters adapt to tougher markets
Deputy Minister of Agriculture and Rural Development Vu Van
Tam has urged tra fish processors and exporters to tighten quality control
over fish fry at farms and input materials to meet international quality
standards in the context of forecast difficulties for tra fish export next
year.
Industry insiders have said farming costs are expected to go
up and the purchasing power in foreign markets remains uncertain in 2015.
At a meeting with seafood exporters from Mekong Delta
localities in An Giang on December 15, Nguyen Huy Dien, Deputy Director General
of Fisheries Directorate, said the Mekong Delta recorded a total tra fish
farming area of over 5,430ha this year, exporting more than 718,000 tonnes
for 1.58 billion USD, up 0.5 percent in volume and 0.04 percent in value.
He noted that poor quality fry have resulted in low living
rate during the farming process, while the prices of feed and other input
materials are on constant rise.
At the same time, many foreign markets have tightened quality
control of imported tra fish, he said, adding that the European Union,
Deputy Minister Vu Van Tam asked localities to improve
cultivation and processing process up to VietGap standards for a start. The
Directorate of Fisheries were requested to appraise the quality of breeding
and feed-making facilities.
Tam praised An Giang and Dong Thap for their preferential
credit model and production chain. He also promised all possible State
support in extending markets, including lower interest rates and tax
incentives, among others.
The
Vietsovpetro fulfils yearly plan
The Vietnam-Russia Oil and Gas Joint Venture (Vietsovpetro)
has fulfilled its yearly plan of exploiting 5.1 million tonnes of crude oil,
the Vietsovpetro’s 44th Council meeting reported on December 15.
Vietsovpetro plans to pump up an additional amount of 260,000
tonnes of crude oil in the remaining half of this month, increasing this
year’s total output to 5.36 million tonnes. However, the figure is 196,000
tonnes lower than that of 2013.
Besides, the venture provided over 1.4 billion cubic metres of
gas, up 0.2 billion cubic metres as planned.
Vietsovpetro also fulfilled its yearly target revenues of 3.86
billion USD and expects to rake in 4.34 billion USD for the whole year.
Japan’s Hamamatsu City promotes investments in Vietnam
The Ministry of Planning and Investment and the Japanese City
Hamamatsu signed a memorandum of understanding that will look to reel in more
investments from
The document was inked by Deputy Minister of Planning and
Investment Nguyen Van Trung and
Under the pact, both sides agreed to create favourable
conditions and provide available information for their businesses,
particularly those operating in the support industry.
They will work together in organising conferences and
delegation visits to seek investments or establishing business support
centres to aid enterprises’ search for partnerships and investment
opportunities.
Addressing the signing ceremony, Minister of Planning and
Investment Bui Quang Vinh stated that
The Hamamatsu Mayor expressed his belief that the cooperation
will bring a lot of benefits, pledging to facilitate investments by his
city’s businessmen in
Located in western
The Mekong Delta city of
The money will be soured from the local and central budgets,
the Government bonds, and the official development assistance (ODA) capital,
said Vice Chairwoman of the municipal People’s Committee Vo Thi Hong Anh.
The submergence has become more serious in the city since 2008
due to the impact of climate change, according to the Southern Institute for
Water Resources Planning.
Ninh Kieu, Binh Thuy, Cai Rang, O Mon, and Phong Dien
districts are the most vulnerable, being submerged under 20-50cm of water
within several hours as a result of tidal surges and floods.
In addition to building new sewage pits and reinforcing
breakwater and embankment systems, Can Tho aims to complete the dredging of
canals inside and outside the city to protect farming areas and aquatic
breeding facilities.
Comprising 12 provinces and one centrally-run city, the Mekong
Delta plays an important role in the nation’s economic growth. However, the
region is threatened by climate change impacts such as rising sea level and
saltwater intrusion.
Scientists predict that a one-metre rise in sea level could
let saltwater in 70 percent of the Mekong Delta’s area. As a result,
Vietcombank gets
The Bank for Foreign Trade of Vietnam (Vietcombank) has won
the ISO/IEC27001:2013 certificate, an internationally acclaimed standard for
information security management, by
Vietcombank is the first bank in
Getting the certificate is considered to be one of the bank’s
commitments to building an information security system following
international standards and regulations.
The application of the international standards will also bring
helpful information to the bank and protect its system better.
Additionally, the certificate will help the bank to know about
its rivals in the banking and finance sector, and reduce the costs and
shortcomings in information.
To earn the recognition, Vietcombank has implemented a large
project on international communication to improve its staff's awareness and
obedience of information security in the whole system. It has also invested
in infrastructure to ensure business activities and meet the required
standards.
The bank is the pioneer in building and applying information
security system in all its business activities and products in the country.
It was the first and only Vietnamese bank listed among the Top
500 leading banks in the world for two consecutive years. Last month, it was
also voted as one of the top three favourite e-banks in 2014.
This year, the bank opened 15 new branches and 38 transaction
offices nationwide to expand its network.
TUV Rheinland is a global leading provider of technical,
safety and certification services , with more than 500 branches in 66
countries and territories.
The Ho Chi Minh City-based Phu Cuong Corporation has unveiled
plans to invest 436 million USD in building a 170MW wind power plant in the
Mekong
Speaking on the sidelines of a wind-power conference held by
the Swedish consulate in
Initially 15 turbines with a total capacity of 30MW will be
built in the coastal town of
He said Phu Cuong Group has plans to build wind power plants
with a total capacity of 800MW.
At the conference, Vestas Wind Systems, a Danish company
producing wind power equipment and parts, signed an agreement to supply
equipment for the Vinh Chau plant.
A master plan for the development of wind power in Soc Trang
has been approved by the Ministry of Industry and Trade, and the provincial
People's Committee has issued a licence for Phu Cuong's project, Dau Tu
(Vietnam Investment Review) newspaper reported. According to the ministry's
General Department of Energy, nearly 50 wind power plants with a total
capacity of 4,876MW have been licensed in the last three years. However, just
three plants are up and running so far.
Seafood
exports to achieve US$7.7 bln in 2014
The nation is currently among the world's leaders in
aquaculture and ranks fourth in aquatic exports. The Vietnamese aquatic
products have been exported to 165 nations and territories around the world.
When bilateral agreements between
Hai Phong attracts US$5.4 bln in FDI in three years
The northern city of
The sum came from 124 licensed projects and 91 operating ones
that increased their investments. These projects mainly focused on the
processing and manufacturing sectors such as the Bridgestone Factory Project
with a total investment of US$574.8 million, Nipro Pharma Corporation with
US$250 million and LG Electronics Viet Nam Hai Phong with US$1.5 billion.
Besides high-tech projects, in 2011-2014, a number of
investors from Japan and the US arrived in Ha Phong to seek opportunities in
the construction of commercial houses, hotels and commercial centers.
To improve its FDI attraction, the city will enhance
investment promotion activities, step up the reform of administrative
procedures, speed up the implementation of crucial infrastructure projects
and train human resources.
Attracting FDI to the agricultural sector
According to the Foreign Investment Agency under the Ministry
of Planning and Investment (MPI), the country has 516 effective foreign
direct investment (FDI) projects in agro-forestry-fisheries sectors with a
total registered capital of US$3.6 billion, accounting for 3% of all projects
and nearly 1.5% of the total registered capital. Drastic changes in both
thinking and approaches are required to attract further FDI capital in the
sector.
It is not difficult to recognise causes leading to the recent
reduction of FDI in agriculture. Poor structuring of the system for
agricultural investment has discouraged investors while the number of skilled
agricultural workers is still low. In addition, there are too many steps in
licensing investment, production and general business among the MPI, the
Ministry of Agriculture and Rural Development (MARD) and the Ministry of
Industry and Trade.
In the above-mentioned situation, FDI attraction to
agriculture is still assumed to be positive and able to increase sharply in
the future. When negotiating the Trans-Pacific Partnership,
To find appropriate solutions to revive the agricultural
sector’s attraction of FDI, a series of macro-level policies and actions have
been taken. The MARD has boosted the implementation of a scheme on
agricultural restructuring. Notably, the scheme on improving the attraction
and management of FDI in agro-forestry-fisheries in the 2015-2020 period with
a vision to 2030, has drawn great attention from international organisations
and foreign enterprises and groups. Many countries consider
FDI in agriculture has seen positive developments with
numerous new projects in agriculture in the north, the south and the Mekong
Delta region in particular. Agriculture has become attractive to many
businesses from
Explaining Japanese enterprises’ recent great attention to
Meanwhile, the Korea Rural Community Corporation (KRC) of the
Republic of Korea and the Dong Thap provincial People’s Committee have
recently signed a public-private partnership agreement on agriculture, in
which the KRC is responsible to mobilise the RoK’s official development
assistance sources and multilateral funds to provide equipment to mechanise
rice production on a 20,000ha area in Dong Thap province.
According to Vice Chairman of the Ben Tre provincial People’s
Committee Cao Van Trong, among 47 effective FDI projects in the province were
two projects of
Ben Tre province has improved the quality of administrative
reforms to attract foreign investors while actively contacting each investor
in certain projects without organising promotion activities such as general
workshops and conferences, keeping in touch with investors and providing
necessary information promptly. Promotional activites are only conducted for
feasible projects.
Drastic restructuring in agriculture and flexible solutions
for localities are expected to be the golden key to the flow of FDI into the
country’s agriculture.
Master Dang Kim Son from the
Foreign residents can buy residential and commercial property
in
Ownership, by foreign individuals or companies, would be on
the basis of a renewable 50-year lease, but property purchases would have to
go through recognised legal entities, such as real estate firms or
developers.
Foreign ownership would be restricted to no more than 30
percent of an apartment building, or 250 houses in a residential street.
“Foreigners who are allowed to enter
Inpyung beheads Daewoo Cleve apartment blocks
Korean property developer Inpyung has decapitated apartment
blocks in its Daewoo Cleve development in
The gigantic 30 to 40 storey blocks have been dramatically
scaled back to 23 to 27 storeys. The height adjustments were announced by the
Hanoi Architecture and Zoning Department, applicable for the entire Van Phu
New Residential Area where Daewoo Cleve is situated.
Inpyung has made the cuts as costs rise on higher blocks. The
cost-cutting has also followed a decline in apartment values in the area over
the last two years, causing Inpyung to restructure its designs and prices to
woo customers.
The decision to reduce the heights of buildings at Daewoo
Cleve may include in a plan to restart the project, which has been delayed
for the last three years.
Once slated as the biggest apartment project in the west of
Beginning construction in 2010 with a plan of constructing 15
high-rise buildings including more than 4,500 apartments, Daewoo Cleve’s
first two blocks were planned to be handed over to buyers by the end of 2013
and the whole project will be finished in 2018. However the project was
stalled after a year of construction, at six storeys and had remained
untouched since then.
Daewoo Cleve is one of many Korean real estate developments
affected by the down-turn in
Meanwhile, other on-going foreign-invested projects face
different troubles. Posco E&C, a partner in a joint venture to develop
the $2.1 billion Splendora development in
Customers in another Korean backed project – Hyundai
Hillstate, are suing the developer – Hyundai RNC Hatay over management fees,
the deliberate miscalculation of apartment space and low quality
construction.
Many others face worse fates. Daewon Binh Khanh Investment
Company, an affiliate of
In another project, GS Cu Chi Development Co., a subsidiary of
Ba Ria-Vung Tau calls for investment in logistics potential
The southern
As the province aims to develop Tan Thanh district into a
modern port city in the near future, it is orienting the district towards
developing logistics and port services as well as industrial parks. Ba
Ria-Vung Tau intends to adopt many incentives for investment projects in
these services at the Cai Mep-Thi Vai port complex.
“Tan Thanh district aims to become one of the most important
port centres of Ba Ria-Vung Tau by 2020,” said Le Van Xuong, Chairman of the
Tan Thanh District People’s Committee, “In the 2015-2020 period, the district
is going to invest in infrastructure, trade and services in order to orient
its economy towards services.”
Tan Thanh has National Road 51 – the road linking Ba Ria-Vung
Tau with provinces in the southern economic zone – running through it. The
district has a system of national and international deepwater ports to meet
the demand for goods transportation for firms in nearby industrial parks,
many of which operate in heavy industry and energy.
“The Cai Mep-Thi Vai port complex is one of the two most
important international transit port groups of
As of now, Ba Ria-Vung Tau’s ports have the total capacity of
87.1 million tonnes. The total cargo volume through the province’s ports in
2014 was estimated at 57.8 million tonnes, up 15 per cent on year, of which
import-export container cargo would increase by 22.5 per cent to 9.36 million
tonnes, equivalent to 1.38 million TEUs (twenty-foot equivalent units).
Meanwhile, dry bulk estimatedly went up 18 per cent to 17.2 million tonnes,
liquid bulk up 1.5 per cent to 13.1 million tonnes, and transit goods up 18.5
per cent to 18.11 million tonnes.
Between 2011 and 2020, Ba Ria-Vung Tau plans to develop
international-standard logistics services at two port complexes, namely the
Cai Mep-Thi Vai and the Sao Mai-Ben Dinh.
Tra fish export to US reduces due to antidumping tax
High antidumping tax rates imposed by the
Despite of a reduction in volume, average export price
increased nearly 4 percent.
The
Motorbike manufacturers increase export
Domestic vehicle production output reached 5 million units
this year, nearly doubling the market demand. However, companies still
expanded their scale with expectation to turn
Though motorcycle manufacturers’ turnover decreased
drastically recently, manufacturing capabilities increased sharply. As per a
statistic, the companies have produced nearly 5 million a year. Furthermore,
many manufacturers have continued expanding scale.
Honda Vietnam has recently put into operation of the third
motorbike factory with capacity of 500,000 units a year. Similarly,
Yamaha has also spent nearly US$30 million on its factory to raise its
manufacturing capability to 1.5 million vehicles per year.
Along with expansion of scale, the companies have introduced
more new vehicles to promote local consumption. In addition, they have also
raised export of vehicles and vehicle parts. For instance, since the second
quarter this year Honda Vietnam has achieved export turnover of nearly US$
200 million. The company has expected to reach US$247 million for export in
2014.
The manufacturers have explained the turnover decreases was
due to the economic crisis and consumers tightened spending. They have
predicted that in the coming years motorcycle consumption would increase as
the world economy recovered.
Economist Bui Hai Minh said that Japanese, South Korean and
Annually, around 43 million motorbikes are sold in the world;
of which, 10 million, 5 million and 5 million motorbikes are sold in
So
PM approves Licogi’s equitization plan
Prime Minister Nguyen Tan Dung has approved an equitization
plan for Infrastructure Development and Construction Corporation (Licogi)
operating under the umbrella of the Ministry of Construction.
Licogi will sell part of State-owned capital and issue shares
for investors to raise its chartered capital.
The firm now has chartered capital of VND900 billion,
equivalent to 90 million shares at the price of VND10,000 each. Of the
amount, the State holds 36 million shares, accounting for 40% of the
enterprise’s chartered capital.
Licogi will sell nearly 1.17 million shares (1.3%) to its
employees, 63,000 shares (0.07%) to its trade union, and 31.5 million shares
(35%) to strategic investors. The remaining 21.27 million shares (23.63%)
will be auctioned.
PM Dung has ordered Minister of Construction Trinh Dinh Dung
and Licogi to decide the starting price for its shares, select a financial
institution as a consultant and a stock exchange for the IPO, and make
preparations for issuing shares on a stock exchange in line with current
regulations.
PM Dung has authorized the construction minister to decide
criteria and select strategic investors for the corporation in accordance
with Decree No. 59/2011/ND-CP issued on July 18, 2011 on converting
State-owned enterprises into join stock companies.
Licogi now has 510 employees and 442 of them will work for the
company after the equitization. Established in 1960, Licogi has 28 member
companies.
The enterprise has taken part in many projects, particularly
power and infrastructure fields. The projects include Ham Thuan-Da Mi
Hydro-electricity Plant in
The government of HCMC will continue to rely on bank loans to
implement development projects but only projects that are gauged as effective
can have access to loans, HCMC chairman Le Hoang Quan said.
At a question-and-answer session at the HCMC People’s Council
meeting last Friday, he said the key task for the city next year would be to
successfully carry out the 2011-2015 socioeconomic development plan and
prepare a new plan for the 2016-2020 period.
Deputy Vo Van Sen asked why the city had kept public debt at a
low level, and whether this tight budget policy had affected the city’s
economic recovery.
Chairman Quan said controlling public debt plays an important
role in stabilizing the macro economy, thus contributing to the nation’s
financial sector stability.
HCMC needs credit for development investment but has to
prepare various resources for loan repayment. The city has handed over land
to investors to develop infrastructure, including four major roads, at an
estimated cost of VND12 trillion, Quan said.
As the city’s economy is facing a host of challenges,
efficient public debt control is a top priority. Therefore, it is impossible
to borrow money for ineffective investment, Quan stressed.
Meanwhile, deputy Lam Thieu Quan said the city sets aside
nearly VND20 trillion for development investment a year. However, most
projects have lagged behind schedule, piling pressure on the city budget if
loan interest is taken into account.
The deputy wondered whether the city had calculated the
average length of delay in a project or planned rewards for investors and
contractors who complete projects ahead of schedule. He also asked whether
the authorities had taken actions to speed up construction progress.
Explaining the situation, Le Hoang Quan admitted slow progress
at many projects, saying relevant agencies have adopted measures to cope with
the problem.
The city now is managing three finished projects funded by
official development assistance (ODA) loans, and supervising debt payments at
19 other ODA-funded projects under construction with a combined investment of
nearly VND120 trillion (including VND98.5 trillion worth of ODA loans and
VND21.3 trillion worth of counter capital). Of which, total disbursements are
estimated at VND6 trillion this year.
Next year, the city targets a GDP growth rate of over 9.5%,
development investments at 30% of GDP and export growth from 8-10%, State
budget collections at over VND265.7 trillion and 120,000 new jobs.
Believe it or not
Governments use import tariffs to restrict trade since they
cause prices of imported items to surge, thereby making them less affordable.
This is clearly a tool of a country’s authorities to regulate trade flows in
a given period of time.
Nonetheless, a report by the online version of Tuoi Tre
newspaper published last Saturday reveals that PV Oil, an oil products
trading arm of Vietnam National Oil and Gas Group (PVN), had been behind a
December 6 decision jointly issued by the ministries of industry-trade and
finance to hike import tariffs on fuels by up to 10 percentage points.
The report says that just before the two ministries announced
the tariff spike, PV Oil had written to the two ministries indicating that
the requirement for fuel trading houses to store volumes of fuels enough to
cover 30 days of distribution while world oil prices are in decline has eaten
into their profits.
In the statement, PV Oil says that since August this year it
had racked up losses. To support PV Oil and other fuel traders, it proposes
the two ministries temporarily keep fuel retail prices at high levels by
raising fuel import tariffs by 5-7 percentage points.
So when world oil prices edge higher, the tariffs would just
be reverted to the previous levels or lowered a little to give fuel traders
scope to hike retail prices. This practice would prevent the market from a
sense of strong price volatility.
Bui Ngoc Bao, chairman of Petrolimex, the country’s leading
fuel trading firm, throws support behind the fuel import tax hikes.
Fuel traders have to store fuel volumes sufficient for 30 days
of sale, meaning they import fuels at higher prices but sell them at lower
prices due to steady price cuts in line with global market movements. The 11
rounds of fuel price cuts this year have delivered a blow to traders, he
reasons.
If this principle of reasoning applies to previous years when
fuel prices kept rising, traders must have earned hefty profits because they
import fuels at low prices but sold them at high prices due to the 30-day
storage rule.
The chairman of Petrolimex even sounds hypocritical when
saying he worries the State would lack money for social welfare if it did not
raise fuel import tariffs.
This is the job of others, not for-profit businesses like
Petrolimex.
VN backed to improve competitive edge
The Vietnam Trade Facilitation Alliance (VTFA) will come into
existence to help the nation enhance its competitiveness and the customs and
other agencies to find and remove barriers to trade and business in the
market.
The United States Agency for International Development
(USAID), the American Chamber of Commerce in
The VTFA will provide policy and technical support for the
General Department of Customs and related trade promotion agencies in
The alliance will also back the implementation of the Trade
Facilitation Agreement (TFA) in
One of the main objectives of the cooperation program is to
back
Source:
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Tư, 17 tháng 12, 2014
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