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BUSINESS IN BRIEF 28/1
Piaggio VN recalling scooters for service on fuel pipe defects
Piaggio Viet
The Piaggio series being recalled this time includes the
Beverly, Vespa GTS and the Vespa LXV. Specifically, Piaggio Viet
The Italian motorbike manufacturer's periodic quality checks
had revealed that there is some problem with the rotor of the fuel pipe in
these particular scooters. The defect might cause difficulties in starting
the engine or even stopping it when the vehicle is used constantly and the
surrounding environment's temperature is high. The free service is being
provided since January 23 at all Piaggio branches nationwide.
Power lines to reach poor households
Of that amount, the country would receive VND3.059 trillion
($145.6 million) in Official Development Assistance funds to work on
installing power lines from 2013 to 2020, he said.
The ministry will need to raise VND27 trillion ($1.28 billion)
from private enterprises, foreign investors and the Government to install the
necessary power systems and improve the quality of existing lines in
disadvantaged areas.
It will cost the ministry VND5 to 10 billion ($238,000 to
$476,000) to give power to one commune that already meets new standards for
rural areas on upgraded infrastructure and living conditions. However, he
said, it would be more difficult and costly to bring power to mountainous,
less developed areas. It would cost about VND100 million ($4,760) per
household.
Prime Minister Nguyen Tan Dung on January 15 approved EVN's
plan to spend $3.3 million to create power systems and improve existing ones
for more than 61,600 households in disadvantaged areas in 10 provinces,
including Dien Bien, Lai Chau, Son La and Gia Lai.
The project, set to end in 2016, aims to improve people's
working and living conditions by installing power lines for them.
According to EVN,
Deputy PM greenlights Vinatex-Mart supermarket chain
equitisation
Deputy Prime Minister Vu Van Ninh has approved a plan to
equitise Vinatex-Mart supermarkets in 2015.
The Vinatex-Mart supermarkets chain, owned by the Viet Nam
National Textile and Garment Group (Vinatex), was established in 2001 to sell
Vinatex's products and several other local textile brands.
By 2013, 58 Vinatex-Mart outlets had been opened across 26
cities and provinces nationwide. Vinatex-Mart supermarkets stock 60,000 items
of five main categories of goods, including garment and textiles, fresh food,
cosmetics and home appliances.
Majority of listed companies report Q4 gains in Hanoi
More than 30 companies, listed on the Ha Noi Stock Exchange,
have announced their operational results for the fourth quarter of 2014, with
most of them reporting positive results.
According to data from the exchange, the number of companies
reporting losses fell, compared with the same period in 2013, especially in
terms of the number of firms and the extent of the losses being reported.
At least 13 listed companies saw their profits swell, notably
Central Hydropower (CHP), PetroVietnam Nghe An Investment and Trading (PXA),
Saigon Petrolimex Gas Taxi (PGT) and PetroVietnam Coating (PVB).
CHP earned a net profit of VND215.8 billion (US$10.13 million)
in the fourth quarter, making up for the losses reported during the first
nine months, adding that its accumulating profit jumped 69 per cent from 2013
to VND213 billion ($10 million). This clearly surpassed an earlier target of
VND115 billion ($5.4 million) fixed by the company.
Other companies reporting gains included PXA and PGT, which
also turned their loss-making operations profitable to avoid being delisted.
While PXA reported a profit of only VND317 million ($14,880), PGT pegged its
profit at VND10.2 billion ($478,870).
As for PVB, its profit during the fourth quarter of last year
rose to VND15.3 billion ($718,300), pushing the annual profit to VND147.5
billion ($6.9 million), which was 2.5 times more than 2013.
Some 17 other enterprises also announced profitable results,
but they pointed out that their profits had declined, from a year ago. Some
reported a drop of almost 100 per cent, including Kon Tum Sugar (KTS) and
Viet Nam Construction No 7 (VC7).
Meanwhile, three firms reported losses. They are PetroVietnam
Gas City Investment and Development (PCG), Song Da Yaly Cement (SDY) and HCM
City Textbook Printing (SAP).
Rural areas could see Tet shortages
The supply of essential goods for the Tet festival is expected
to be enough for the local market, though there might be shortages in rural
and remote areas, experts said.
Vo Thanh Do, deputy head of the department of processing and
trade for agro-forestry-fisheries products and salt production, said that
there will be an estimated high volume of 1.5 million tonnes of rice
available for the Tet festival in February.
The rice prices will be stable and even fall slightly by
VND200 to VND300 per kilogram in the south due to the harvest season of the
winter-spring rice crop.
The official from the Ministry Agriculture and Rural
Development said that the demand for rice will reach an estimated 70,000
tonnes in Ha Noi and about 1,200 tonnes in
Supplies of fresh food such as meat and seafood are expected
to be high, said Do.
Fresh food prices have been stable over the recent past, and
could fall due to petrol price reductions, he added.
The livestock department said that in the first two months of
this year, the total supply of meat, eggs and milk for Tet will increase by
20 per cent against normal months. The total output of meat has reached
580,000 tonnes.
Tong Xuan Chinh, deputy head of the livestock department, said
that the rising demand for these products will lead to a slight increase in
their prices. However, their supply will meet the local market demand.
The total area used for growing vegetables has reached 180,000
ha, 15,000 ha more than the same period last year, the department of
plantation said.
Therefore, the supply of vegetables for the Tet festival will
meet the local demand, if there is no bad weather.
However, there is likely to be a shortage of essential goods
during Tet in some rural and mountainous areas as well as industrial zones,
and so the state offices should regulate the market to ensure circulation of
goods, said Do Thang Hai, Deputy Minister of Industry and Trade.
Plastic industry leans on imports
Increasing exports notwithstanding, the plastic industry faces
some serious difficulties, including a continued shortage of raw materials,
according to the Viet Nam Plastic Association (VPA).
The industry is highly dependent on imports, buying about 80
per cent of the polyethylene, polyvinyl chloride E, and polyvinyl styrene it
needs (around three million tonnes a year), mostly from South Korea, Taiwan,
Thailand, Singapore, Saudi Arabia, Japan, and Malaysia, the association said.
It can only source certain raw materials like polyvinyl
chloride, polyethylene terephthalate, and polypropylene locally.
Speaking at a review meeting organised in
The products are shipped to many markets like
The Viet Nam-EU Free Trade Agreement, for which negotiations
are underway, could be an opportunity for Vietnamese plastic firms exporting
to the EU, which bought 25 per cent of
However, the EU has some non-trade barriers in place, which
could deprive Vietnamese exporters of tax breaks, Lam said.
For instance, the EU requires exporters to clearly state the
origin of the chemicals they use and do research on the impacts caused by
their products, which would also result in higher production costs, he said.
Failure to satisfy the conditions would not only mean they
cannot benefit from lower tariffs under the FTA, but could even be banned in
that market, he said.
The consumption of plastic products has shot up in the past
few years. For instance, it was 22kg per capita per year in 2008 while by
2013 it was up to 35kg.
It is expected to rise to 45kg by 2020, according to industry
insiders.
This has sparked a scramble among producers to improve
technologies and thus their products so that they can capitalise on this
demand.
Ford
Ford
The new additions have been invested in with more than VND120
billion (nearly $6 million), helping to bring the total number of dealerships
in the Ford Vietnam network to 27.
“This dealership will not only be a place where our customers
come for advice on a car that can cater to different needs in their lives,
this will also be where they become members of the extended Ford family and
experience the best services from Ford,” said Dave Schoch, Ford Motor
Company’s group vice president and president in Asia Pacific. “Bringing the
best to the Asia Pacific is a key part of Ford’s 2020 global growth goal, and
Located on
The new Binh Duong Ford dealership has the total investment
capital of VND78 billion (nearly $3.9 million) and uses advanced equipment
and well-trained staff, making it fully in compliance with Ford Motor
Company’s global standards.
In addition, Ford Vietnam has also upgraded its Pho Quang
branch (part of its Saigon Ford network) into a sales, service and spare
parts outlet, providing customers with an expanded range of service options.
Saigon Ford also announced that its new boutique will open on
“Ford
The Ford Motor Company recently announced that its overall
2014 retail sales for the ASEAN region rose more than 5 per cent from the
previous year to a record 100,824 units. The company’s ASEAN sales were
driven by record full-year performances in the
In
Hepza to attract $700 million in 2015
Last Friday, Hepza released a report on the investment
attraction of industrial and export processing zones (IZs and EPZs) in 2014
and the development plan for 2015, showing that Ho Chi Minh City lured in a
total of $752.39 million worth of investments signifying a 23.52 per cent
increase compared to the previous year and exceeding its referent target by
136.8 per cent.
Foreign direct investment (FDI) capital in the second city’s
IZs and EPZs hit $347.5 million in 2014, a slight decline of 4.39 per cent
compared to 2013. Meanwhile, the domestic investment sum was estimated at
more than VND8.5 trillion ($404.89 million), a 64.8 per cent increase
over the previous year.
Tran Cong Khanh, a senior official of Hepza said that the
total export revenue of IZs and EPZs increased by 7.84 per cent compared to
2013, totalling at $5.5 billion in 2014.
According to Hepza’s Investment Management Office director
Tran Viet Ha, most foreign invested projects in 2014 were in textile and
garment, services, electronics, machinery, tobacco and foodstuff
plastic and rubber processing sectors.
Imperia sets sights on Hanoi
HBI Joint Stock Company – the developer of Imperia An Phu in
Located on a 42 hectare site in Thanh Xuan district,
It is adjacent to the ring road, and the elevated railway
system which is currently under construction. This offers convenient access
to the city centre and other new urban development areas. Other on-site
facilities include a four-season swimming pool, healthcare services, a beauty
spa, a gym, a supermarket and intelligent parking services. Ranging from 65
to 174 square metres, each apartment is designed according to modern and
eco-friendly standards.
Ascott opens its first serviced residence in Haiphong
CapitaLand’s wholly-owned serviced residence business unit,
The Ascott Limited (Ascott), has opened its first
The 132-unit Somerset Central TD Haiphong City is located on a
prime urban area in the city’s new central business district. The new
property is the first international branded serviced residence in
“Ascott has established a presence in
To celebrate the opening of Somerset Central TD Haiphong City,
Ascott is offering special introductory rates starting from VND1,650,000++
per night or VND30,450,000++ per month for a Studio Executive from now until
April 30, 2015.
For reservations or more information, please visit
www.somerset.com, call (84-31) 3810000 or email
enquiry.haiphong@the-ascott.com.
Besides Somerset Central TD Haiphong City, Ascott operates
three properties in
Beating a path to regional Integration
As
The East-West Economic Corridor (EWEC) is an economic
development programme initiated in order to promote development and
integration of
In order to bring into
play the special friendship between
Vietnam and Laos and promote the potential of
the EWEC, the Vietnamese government has established Lao Bao Special Economic
and Commercial Area (SECA).
Lao Bao is also the gateway of the EWEC to Vietnam, the
shortest and most favourable route to expand the
exchange of goods, tourism and services
with Laos, Thailand, Myanmar and other countries in
the Greater Mekong Sub-region (GMS). It has an industrial zone, export
processing zone, economic border gate zone and special non-tariff area. The
SECA offers the highest investment and business incentives currently
available under Vietnamese law.
The establishment of Lao Bao has positively contributed to the
economic growth of Quang Tri and the EWEC. During the 2004-2010 period,
around 56,000 to 58,000 vehicles annually travelled along the EWEC road
through the Lao Bao Border Gate. Cross bordered freight
turnover increased dramatically from $58 million
in 2000 to $251 million in 2010.
As the ASEAN Economic Community will be established in 2015,
trade of goods and services between ASEAN members along the EWEC will be
intensified.
The province wants more from the growth of the EWEC, and so
the Quang Tri Provincial People’s Committee plans to develop Lao Bao as an
economic hub in the west of the province, making it home to industrial
manufacturing, agricultural and forestry processing, and tourism services.
In addition, the province is conducting a $101.6 million Asian
Development Bank-funded project helping transform the corridor towns of Dong
Ha and Lao Bao economic hubs by improving urban-environmental infrastructure
and strengthening institutional capacities of the local authorities.
This project aims to enhance the competitiveness of towns and support the
development of the Greater Mekong Sub-region’s transport routes into vibrant
economic corridors.
Quang Tri rolls out investment invite
The central province of Quang Tri – home to one of the
bloodiest battlefields during the American War – is now renowned as one of
the country’s top investment locations.
The Electricity Generating Authority of Thailand, better known
as EGATI, is making Quang Tri its chief focus as it develops its overseas
business in
According to the Quang Tri Provincial People’s Committee, the
$2.26 billion power project will operate under the build-operate-transfer
(BOT) model. Once completed, it will play a key role in ensuring national
power security as well as bolstering the local socio-economic development.
EGATI is not the only investor setting up shop in Quang Tri.
Data from the province’s Department of Planning and Investment shows that by
October 2014 the province had attracted more than 200 private investment projects,
with the total investment capital of more than $2 billion.
Some projects operating there have achieved remarkable
success, including Geruco MDF wood processing mill, Phong Phu garment and
textile factory, Hoa Tho garment and textile factory, Super Horse energy
drink plant, Camel motorbike tyre plant, ICall mobile assembling plant and
Uni-President Ltd’s facility.
Situated in central
Although the province recorded an average per capita income of
just VND19.5 million (around $900) in 2013, the province’s economic structure
has greatly improved in recent years, with industry and construction
accounting for 38 per cent of the province’s output, followed by agriculture,
forestry and fisheries at 23.8 per cent, and services accounting for the
remaining 38.2 per cent.
Despite the fact that Quang Tri remains one of the poorest
provinces in
According to the government’s gas industry development master
plan, a gas transmission system to Quang Tri will be constructed during the
2014-2016 period. This system will be capable of transporting 1-3 billion
cubic metres of gas per year. Once completed this will obviously provide
favourable conditions for the development of the gas-nitrogen industry and
hi-tech product processing in the province.
Quang Tri also has 8,400 square kilometres of fishing grounds
for raisin tiger shrimp, cuttlefish, greater amberjack fish and sea-cucumber,
providing an annual catch of some 17,000 tonnes. The province has another
4,000 hectares of water surface for shrimp and crab farming. More than 3,000
hectares are already being used for aquaculture with the annual output of
7,500- 8,000 tonnes.
Low oil prices both good and bad for Vietnam
Vietnamese authorities are trying to find ways to cope with
tumbling world oil prices, but are optimistic about long-term benefits for
the economy.
World oil prices have dropped UD10 a barrel for RON92 to USD54
in the past month, hitting a six-year low of USD46 on January 13.
Vietnam Petroleum (PVN) contributed 26 percent of the overall
state budget in 2014, and declining fuel prices will have an impact on state
spending. The Minister of Planning and Investment, Bui Quang Vinh, said if
the price dropped to USD40 a barrel, the state budget might lose VND70trn
(USD3.3bn) in revenue.
"If the price stays at USD60 a barrel then there's not
much of a disturbance, but when the oil price drops to USD40, Vietnam will have
to reduce its oil production by 1.8 million tonnes," he said.
The Ministry of Industry and Trade planned to export 14.74mn
tonnes of oil this year, and a price drop to USD40 would affect many
investment plans. The target GDP growth of 2015 would fall by one percentage
point to 5.2 percent.
PVN cuts oil production
PVN already cut oil production this year by some 450,000
tonnes in oil fields with production costs of USD60 to USD70 a barrel.
The Minister of Finance, Dinh Tien Dung, said there were
positive factors even if oil stays under USD50 or falls to USD20.
"It would be a start of an economic boom in the
long-term, which would be good for Vietnam," he said, "The ministry
also has other plans to balance the budget."
Vietnam imports more oil than it exports, and a consequence of
lower prices would be a decline in transportation costs and price falls in
other areas, which would be a boost to the economy.
But authorities are worried about a boom in gasoline
smuggling, because fuel in Vietnam, is already cheaper than neighbouring
countries such as Cambodia, China, Thailand and Laos.
Finance ministry wants better controls on transport charges
The Ministry of Finance has requested the Ministry of
Transport and local governments to slap fines on transport enterprises which
hesitate to reduce charges in accordance with fuel price cuts in the country
in the past months.
The finance ministry made the request after local fuel trading
firms slashed retail prices on Wednesday afternoon, with the prices of RON92
petrol and diesel falling by VND1,900 per liter to VND15,670 and VND1,460 per
liter to VND15,170.
In Document 931/BTC-QLG sent to the transport ministry and
local governments, the finance ministry wanted violators to have their names
published on mass media in addition to heavy fines.
According to the finance ministry, inspections by relevant
agencies showed that a large number of transport enterprises have not
adjusted down their fares despite multiple fuel price cuts in the past
months. Therefore, the transport ministry and the agencies concerned were
urged to check the situation and impose fines on firms slow in registering
for charge reductions in line with prevailing regulations.
Local authorities should check those transport companies which
have already made fare reductions but lower than required and can fine
violators.
Article 11 of Decree109/2013/ND-CP regulates fines of VND5
million to VND30 million for enterprises which violate regulations on price
registrations. Besides, violators must revise their prices in line with the
regulations.
Lending rates may inch up in Q3
Lending rates are likely to rise in the third quarter of this
year if monetary and fiscal policies are not implemented consistently, warned
a member of the National Advisory Council for Financial and Monetary
Policies.
Dr. Le Xuan Nghia told a seminar on this year’s economic
scenarios in HCMC on January 22 that inflation is not worrisome this year as
it is forecast to grow between 3% and 3.3% if the pricing factors from fuel
and foods are excluded.
But the lending rates will depend much on inflation and money
supply of the central bank, Nghia said. Early this year, the central bank set
a target of bringing the medium-term and long-term interest rates down to
below 10% per year, and may control money supply to achieve the target.
Nghia noted such a target is not easy to be reached. If
government bonds continue to be issued in bulk like now and there are no
consistent policies, the lending rates will possibly go up in the third
quarter.
The new rates may be not much higher than the existing levels
but will hit enterprises which are still in difficulty. Therefore, the
Government needs to implement policies harmoniously, otherwise the rates will
move up, affecting policies for economic reform and recovery of enterprises,
the according to Nghia.
Last year, the borrowing and lending rates declined by 1.5-2
percentage points and two percentage points per year respectively. The common
lending rates of last year were 7-9% for short-term loans and 9.5-11% for
medium- and long-term ones.
According to figures Nghia mentioned at the seminar, the
government bonds still take an lion’s share of the total bonds in circulation
in Vietnam with a rate of 75.38% (equivalent to over VND496 trillion),
followed by bonds guaranteed by the Government with 22.12% (over VND145.5
trillion) and municipal bonds with 2.5% (over VND16.4 trillion).
Some 35.2% of the G-bonds carry a two-year term, 34.5% three
years, 21.8% five years, 6.1% ten years and 2.3% 15 years. The average term
of G-bonds is 2.35 years and the Government wants to raise it to 3.5 years.
Trade ministry okays tenders for sugar import quota
The Ministry of Industry and Trade has agreed on picking
importers for the annual sugar import quota via tenders this year rather than
appointments as in previous years.
Ha Huu Phai, chief representative of the Vietnam Sugarcane and
Sugar Association (VSSA) in Hanoi, told the Daily that the ministry approved
in principle such tenders for the import of 81,000 tons of sugar this year as
committed to the World Trade Organization (WTO).
Phai said the trade ministry gave the nod at a meeting with
the ministries of agriculture-rural development and finance and VSSA on
Tuesday. But relevant ministries and agencies and the association will have
to discuss detailed procedures for the tenders.
Earlier, VSSA had many times proposed the ministries of
industry-trade and agriculture-rural development adopt a new mechanism to
select candidates to fulfill for the sugar import quota instead of appointing
importers.
In previous years, Vietnam had to import at least 70,000 tons
annually in accordance with the country’s commitment to the global trade club
WTO and importers were appointed to fulfill this quota.
VSSA chairman Nguyen Thanh Long said Vietnam imported 72,200
tons of sugar last year and the trade ministry picked processing firms to buy
40,000 tons of the volume and the rest for sugar mills and enterprises,
including Bien Hoa Sugar Company (15,000 tons), Thanh Thanh Cong Tay Ninh (10,000
tons) and Lam Son Sugar Company (5,000 tons).
Long said the old mechanism triggered unhealthy competition
among domestic sugar companies as the chosen importers would benefit much
from the price difference of locally-refined and imported sugar products.
Phai calculated the price of imported sugar was VND2,000-4,000
per kilo lower than that of local sugar in previous years, and 15,000 tons of
sugar could bring about tens of billions of dong in profit for the importer.
“This sparks unhealthy competition among sugar enterprises,”
Phai said.
This is the reason why VSSA has requested the trade ministry
to change the appointment mechanism to stop an ‘ask-and-give’ mechanism
between sugar enterprises and administering agencies.
Indian apparel firms come knocking
Representatives of nearly 40 Indian enterprises have paid a
five-day trip to Vietnam to sound out business prospects on this market,
especially the apparel sector.
Milind Hardikar, managing director of Welspun Group, one of
the world’s leading producers of household apparel products, said the group
is considering investing in apparel projects in Vietnam to turn out products
for export to the United States.
Welspun has seen new opportunities in Vietnam as the country
is determined to join the Trans-Pacific Partnership (TPP) agreement, he told
the Daily on the sidelines of the Vietnam-India trade forum in HCMC on
Wednesday.
The delegation, led by Indian Deputy Minister of Commerce and
Industry Rajeev Kher, also included companies operating in the fields of leather-shoe,
pharmaceutical, agriculture, food processing, banking and engineering. As
scheduled, they wrapped up their Vietnam trip on January 22.
Kher said India is a big producer of cotton and fiber while
Vietnam is strong in textile and garment. Therefore, Indian producers can
provide materials for Vietnam and guarantee stable supply for enterprises in
this market.
Siddhartha Rajagopal, managing director of the Cotton Textile
Export Promotion Council of India (Texprocil), told the Daily that Indian
firms are serious in exploring investment opportunities in Vietnam’s apparel
sector and are making efforts to boost trade and investment ties with
Vietnamese counterparts.
Do Huu Huy, head of the West Africa and Southwest Asia Markets
Department under the Ministry of Trade and Industry, said the ministry and
India’s Ministry of Commerce and Industry on Tuesday signed an agreement to
prop up trade cooperation between the two countries.
Vietnam requested India to remove barriers to imports of
Vietnamese products into India such as high tariffs on cashew nuts and
safeguard and anti-dumping investigations into several products imported from
Vietnam.
India pledged to provide a US$300-million credit to support
cooperation between the two countries in the apparel sector.
Two-way trade between Vietnam and India stood at US$5.6
billion last year, including US$2.5 billion worth of Vietnam’s exports. The
two countries target US$7 billion this year and US$15 billion in 2020.
Many firms slow in social insurance payment
More and more enterprises have been slow in paying social
insurance premiums for their employees due to business difficulties, Vietnam
Social Insurance (VSI) agency said.
Do Van Sinh, deputy general director of VSI, told a recent
review conference in Hanoi that business difficulties have forced many
enterprises to scale down and suspend their operations, and go bankrupt.
VSI reported that the total insurance premium arrears of
enterprises neared VND7.3 trillion last year, equivalent to 4% of the amount
the agency should collect in the same year. Of which, overdue social
insurance premiums accounted for nearly VND5.6 trillion, unemployment
insurance debts for VND336 billion and health insurance debts for over VND1.3
trillion.
Localities with high social insurance arrears last year were
Lai Chau Province (12.6%), Hanoi (6.7%), Hoa Binh Province (6.4%), Binh Dinh
Province (6.2%) and Phu Yen Province (5.1%).
Cao Van Sang, director of HCMC Social Insurance agency, said
enterprises based in the city had social insurance premium arrears of over
VND1.4 trillion last year. To protect legitimate rights of laborers, the
agency took legal action against over 1,700 companies and collected a total
of VND129.9 billion.
According to VSI, 50 municipal and provincial social insurance
agencies sued over 5,830 companies for slow health insurance premium payment
of VND2.445 trillion but got only VND621 billion, equivalent to a mere 8.6%
of the insurance premium debts.
VSI said agencies collected insurance, health and unemployment
insurance premiums of nearly VND198.2 trillion last year, or 2.52% higher the
year’s target.
Local enterprises unprepared for further regional integration
The chairman of the Hanoi Young Business Association has
pointed out the fact that the majority of Vietnamese businesses are not yet
well prepared for more competition triggered by the country’s further
integration into the region, especially after the ASEAN Economic Community
(AEC) is formed this year.
Le Vinh Son quoted a survey of the association as saying that
up to 80% of corporate respondents do not pay attention to the country’s
regional integration and only 20%, mainly big enterprises like Viettel and
BIDV, do.
“We find that Vietnamese enterprises lack knowledge of
the integration. Most of them are rather passive and don’t know what will be
happening to them ahead though the integration (the AEC establishment) is
very close,” Son told an online dialogue organized by the Government portal
on January 22.
He said the concerns are that Vietnamese businesses,
especially small- and medium-sized enterprises will be affected when with the
AEC is established as more enterprises of ASEAN and ASEAN+ which are more
active and more competitive will enter the local market.
“I’m really concerned about that. Though it’s late now, it’s
necessary to make local enterprises aware of the integration,” Son said.
The Government should have helped enterprises and business
associations to better know what to prepare for the nation’s further
integration, Son added.
Nguyen Hong Son, rector of the Vietnam National University’s
University of Economics and Business (UEB), shared the same viewpoint, saying
that Vietnamese enterprises’ preparations for AEC are below average.
A survey of UEB showed that 60% of Vietnamese enterprises do
not know about AEC.
According to Son, integration will pose more challenges for
producers of consumer goods.
“As we can recognize, more Thai goods are entering the
Vietnamese market. In addition, the middle-class consumers favor foreign
products thanks to higher quality,” Son said.
The second challenge is the skilled labor shift. “Only 20% of
Vietnam’s human resources are skilled and they may shift to the foreign
direct investment (FDI) sector or other ASEAN countries while foreign,
skilled laborers will move to Vietnam,” he analyzed.
Meanwhile, Deputy Minister of Industry and Trade Nguyen Cam Tu
is optimistic about the future when he said that “Just look at the big things
we have done, from zero to what we are having now, to instill confidence in
integration.”
According Tu, the gap between Vietnam and other ASEAN
countries 10-15 years ago was huge. In the past, Chinese goods flooded the
Vietnamese market, but now there is no place for Chinese beer or Thai sugar.
“We have a growing economy, a large number of enterprises,
diverse and competitive products,” Tu said when he tried to prove Vietnam has
been ready for further regional integration.
“We should see in that way so that we are confident that we
will integrate successfully,” he continued.
Vietnam and Singapore score over 90 out of 100 points in
adopting priority measures for the AEC integration while the average score of
ASEAN countries is 82, according to Tu.
“We have built a system of legal documents suitable for a
market economy… Our legal system is more comprehensive than that of many
other countries,” Tu said, implying the Government has made preparations for
integration.
At the dialogue, participants agreed that further integration
would speed up internal reforms and make the country prosper.
Japanese firms in need of many workers
Japanese companies in the south are seeking to recruit more
than 6,000 employees to work in different fields, including component
assembly, software programming, design and translation.
Some 23 Japanese firms operating in HCMC, Dong Nai and Long An
took part in a job bazaar in HCMC on Wednesday to look for thousands of
qualified candidates. Most of them are small and medium, and the companies in
need of many workers included Wonderful Saigon Electrics Co. Ltd. and Nidec
Seimitsu Vietnam.
According to Masaaki Shooka, senior manager of Global
Recruiting Division, local laborers have many opportunities to work for 1,500
Japanese companies in Vietnam. But he noted they should improve their soft
skills such as Japanese proficiency and computer skills, and change their
working attitude to meet the needs of employers.
Kenta Chisaka, a representative of Pasona Global, told the
Daily that most jobseekers focus on big and well-established companies while
new and small companies offer them more job opportunities.
According to employers, many applicants could not pass tests
on what they did write in their job applications because they falsified their
skills.
Vuong Quoc Bao of the 100% Japan-owned Wonderful Saigon
Electrics, advised applicants to state what they could do for employers to
arrange proper jobs for them.
One more foreign ice-cream brand introduced
Orana Vietnam has inaugurated a facility producing ice-cream
with the Osterberg brand in HCMC after 13 years of processing products from
fresh fruit.
In addition to ice-cream, the US$2-million facility produces
jam, fruit juice and syrup products with the Osterberg brand.
The new investment will enable Orana Vietnam to turn out
around 6,000 tons of products per year, doubling the company’s current
output.
Orana Vietnam will make ice-cream base for sale at the
Osterberg shops to be opened in the city, with 60-70 tons planned this year.
In 2013, the parent company Orana opened ice-cream shops in
Copenhagen, Denmark. In Vietnam, the first Osterberg ice-cream shop will be
in place in District 1 after the Lunar New Year holiday, also known as Tet.
The current foreign ice-cream brands in Vietnam include Dairy
Queen, Baskin Robbins and Swesens.
Located at Tan Thoi Hiep Industrial Zone in HCMC’s District
12, Orana Vietnam is a joint venture between Orana Denmark and local firm Phu
Cong Minh. It now supplies materials for dairy companies.
Seafood, agro-forestry exports drop 14% in January
Vietnam earned an estimated US$1.95 billion from exports of
agro-forestry-fishery products in January, a year-on-year decline of 13.8%,
according to the Ministry of Agriculture and Rural Development.
Of the figure, farm produce exports were valued at US$859
million, down 11.8%, while exports of seafood saw a decrease of 25.6% to
US$412 million and forestry product export generated US$520 million, down
8.2%.
Export items saw an increase included tea, cashew nuts,
cassava and cassava products.
In January, Vietnam shipped abroad 9,000 tonnes of tea, raking
in US$17 million, up 1.4% in volume and 5.7% in value year on year.
Meanwhile, cashew nuts brought home US$29 million from 18,000
tonnes, representing respective year-on-year increases of 16% and 20%.
However, rice exports generated US$152 million, a year-on-year
decrease of 12.7% for a volume of 312,000 tonnes, down 14.5%.
Coffee exports were US$202 million, down 23.6% in the reviewed
period.
Germany inaugurates coffee processing plant in Dong Nai
A US$12 million coffee processing plant was officially
launched by the German group Neumann Gruppe on January 26 in the An Phuoc
Industrial Zone, Long Thanh district, southern Dong Nai province.
Covering an area of 5ha, the plant is designed to process
around 26 tonnes of coffee per hour or 100,000 tonnes per year by 2017 with
finished coffee to be shipped worldwide.
The newly-built plant is the second of its kind invested by
Neumann Gruppe in Vietnam, after the first constructed in 1992 in southern
Binh Duong province.
Vice Chairman of the Dong Nai provincial People’s Committee
Nguyen Phu Cuong expressed his hope the plant will help expand local coffee
growing areas, and vowed to facilitate the company’s operation.
The German group currently has 46 coffee processing plants in
28 countries around the world which contribute to 10% of global coffee
exports.
Vietnam’s livestock sector in a changing landscape
Vietnam’s livestock sector has always been considered by most
leading economists to be particularly vulnerable to regional and global trade
liberalisation, largely because it is dominated by smallholder production
systems typified by the traditional family farm.
The argument has been that agricultural trade liberalisation
would give undue advantage to large commercial scale production systems such
as those in neighbouring Thailand at the expense of the family farmer
resulting in a deterioration of the trade balance for the industry.
However, other economists have said not so fast, regional
trade liberalization in particular would bring with it a reduction in costs
for the smallholder in Vietnam along with an increase in sales prices
relative to costs and thereby increase their income.
It would also provide the opportunity for those able to
reinvest those profits or corral alternative sources of investment to boost
research, modernise their equipment and scale up their systems enabling them
in the long run to compete on an equal footing.
We are now beginning to see early signs that the latter
economists may have been on target with their analysis.
Take for example, Ba Huan Co, Ltd, a smallholder egg supplier
in Vietnam. It was able to muster investment for a modern factory in Long An
province it just inaugurated in early 2015, which incorporates all the latest
technologies.
Earlier, the company erected a VND100 billion factory to
process eggs in the Binh Chanh district, HCM City and a standard breeding
farm in Binh Duong after it was able to round up VND320 billion.
With an investment of VND60 billion, the company also
implemented a new factory in Long An province specialising in producing fresh
chicken, chicken sausages, chicken and duck eggs, flan cakes, and some fast
food products made from of chicken.
In addition, it has plans to forge a fresh path with a new
line of products, which details it is keeping closely under wraps for now,
with the support of food experts, technological engineers, marketing staffs
and well-trained workers.
The company is well on its way to becoming the largest
supplier of egg products in Vietnam with aims of dominating the ASEAN
marketplace in the future.
As another case on point, Thuong Chi Thien, director from of
the Vinh Thanh Dat joint stock company said after pumping all the available
monies they could get their hands on into research, the company assembled
sufficient monies to launch a novel new line of instant egg products.
These products have increased the life of their products on
the supermarket shelves from four to six months thereby gaining a competitive
advantage. Thien said the launch of new product line gives them a sizable
advantage in the domestic market, which will carry over to the ASEAN market.
Vietnam Meat Industries Limited Company (VISSAN), a
smallholder member company of Saigon Trading Group (SATRA), in turn has
experienced success through efforts to put a food investment in a processing
industrial complex into operation in Long An province soon.
The company is cooperating with Hoang Anh Gia Lai group and
moving with haste to launch an unprecedented beef product line later this
year. Vissan General Director Van Duc Muoi is banking these on the products
becoming a sensation and really soaring when the AEC takes effect.
Recently, the Thailand's Department of International Trade Promotion
(DITP) has invited a large number of Vietnamese enterprises companies to
participate in the VIV Asia 2015 – the Asian region’s largest trade show for
the international feed industry which will be held for Bangkok this upcoming
March 11-13.
This invitation demonstrates Thailand’s avid interest in
cooperating with Vietnam in the livestock industry. It also
demonstrates Vietnam smallholders can be competitive in the region given the
right entrepreneurial spirit mixed with investment and research.
Dr. Tong Xuan Chinh, deputy head of the Animal Husbandry
Department under the Ministry of Agriculture and Rural Development, cautions
that too many smallholders may be taking a lackadaisical approach to the
formation of the AEC.
Chinh said there remains considerable lack of preparedness for
the establishment new ASEAN regional marketplace and these smallholders are
particularly vulnerable. They most likely will suffer and go out of
business.
Only those smallholders who take a proactive approach to the
AEC formation have any chance at succeeding he said.
Mr Chinh suggests smallholders in the livestock industry speed
up trade promotion activities touting the advantages of high quality produced
in
They need to start looking to forming cooperation agreements
and forming supply chains with other ASEAN member nations to collectively
cooperate in the
Source :
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Thứ Ba, 27 tháng 1, 2015
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