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BUSINESS IN BRIEF 22/3
Higher competitiveness needed to fuel growth
The government of HCMC needs to make greater effort to improve
labor productivity and competitiveness if the city wants to serve as the
strong locomotive of the country’s economy, said the head of the Party
Central Committee’s Economic Commission.
The city is coping with a series of challenges related to
economic growth and urban management, Vuong Dinh Hue told a seminar on HCMC
with 40 years of development and integration, organized on March 17 by the
city government and the Vietnam Fatherland Front Committee in HCMC.
To prop up socio-economic development in the years to come,
the city should focus on a growth model that boosts labor productivity and
competitiveness, research and development (R&D), industrial restructuring
with modern technology and local content in its products, and development of
industrial clusters and supporting industries.
It is important for HCMC to strengthen connectivity with
localities in the Southern Focal Economic Zone in terms of economic growth
and transport infrastructure, as well as develop material supplies for safe
farm produce processing.
Former Prime Minister Phan Van Khai told the seminar that the
city has become an important city of the country. The fast expansion of the
labor force, successful poverty alleviation and the improvement of living
standards in the outlying districts have been among the outstanding achievements
of the city since 1975, when the city was liberated, paving the way for the
reunification of the country.
However, Khai urged HCMC to put urban infrastructure
development on faster track with more resources on zoning and planning
management to support strong economic growth.
Tran Du Lich, deputy head of the HCMC delegation of National
Assembly deputies, pointed out problems with the economic structure, urban
infrastructure and public administration.
Lich told the seminar that the low efficiency and overlapping
functions of the public administration have put the brakes on economic reform
and on development of a healthy business environment.
But HCMC chairman Le Hoang Quan insisted the city had obtained
strong economic growth and economic restructuring had been implemented
effectively in the past years. The city’s gross domestic product (GDP) was
US$5.3 billion in 2000 but rose to more than US$40 billion last year.
As of the end of last year, the city had had three export
processing zones, 13 industrial parks, 37 commercial centers, 175
supermarkets, 240 traditional wet markets, and 723 convenience stores.
The city targets GDP per capita of over US$5,538 this year
compared to US$5,131 last year and the average annual income of VND16 million
per household, equivalent to the world’s level.
Fuji Xerox Haiphong hopes domestically produced parts will
contribute over 90 per cent of the product value generated in its first
Vietnam-based plant.
“It would be nice to have 100 per cent, but the problem is we
cannot source them,” said president Tadahito Yamamoto.
Domestically produced parts now make up 50 per cent of the
value Fuji Xerox generates at
Apart from raising the localisation rate, the firm also
intends to raise the capacity of the plant to its full level from the current
50 per cent and turn it into a production hub that will serve the entirety of
the fast growing Asia Pacific region.
Fuji Xerox Haiphong started production in November 2013. The
plant, which cost $120 million, is located in the
Fuji Xerox targets to raise the portion of overseas revenue to
60 per cent of its total revenue in the course of the next two years,
according to president Yamamoto. To reach the target, the firm is increasing
marketing activities in growing markets such as
MK Smart becomes first JCB card manufacturer in Vietnam
MK Smart JSC, a member of MK Group, recently announced the
company has been certified by JCB International Limited (JCBI), the
international operations subsidiary of JCB Limited, to be the first JCB card
manufacturer in
MK Smart factory based in
Besides, the factory has closed production process, from the
stage of receiving information from client to finished product delivery.
This process is closely monitored by qualified technical
department with hi-tech infrastructure, ensuring efficiency and absolute
security.
“MK Smart’s earning certification by JCBI has confirmed the
leading position of MK Smart in
“This is a strong proof for the quality and technology of MK
Smart products. JCBI certificate allows MK Smart to provide JCB cards
with competitive price and fast delivery,” Ha added.
MK Smart JSC, established in 2003, is the only company in
JCB is a major global payment brand and a leading credit card
issuer and acquirer in
Vietnam is about to finish building an oil and gas platform to
export to Brunei in June in accordance with a US$100 million agreement
approved by the former’s PTSC Mechanical and Construction Company and the
latter’s Total E&P Borneo B.V. in February last year.
Dong Xuan Thang – director of the PTSC Mechanical and
Construction Company, an arm of the Vietnam National Oil and Gas Group
(PetroVietnam) – said his firm has completed the construction of the 1,200
ton base (or jacket) of the platform.
Now, it is building the topside of the platform, weighing
nearly 3,000 tons, in Vung Tau of the southern Vietnamese
The two parts of the platform, named the Marahaja Lela South
(MLS), will be taken offshore and delivered to the investor, Total E&P
Borneo B.V., in June.
In February last year, PTSC M&C and MLS signed a contract
to provide engineering, procurement, construction, and commissioning services
of the MLS platform to be located in water at a depth of 63 meters offshore
Brunei. The value of the contract is $100 million.
In November 2014, PTSC built and exported to
Impact assessments to become the norm
Detailed environmental impact assessment reports will become
the norm for investment projects in certain sectors in
The government has enacted Decree 18/2015/ND-CP on
environmental protection zoning, strategic environment assessments,
environmental impact assessments (EIA), and environmental protection
planning. Under the decree which will take effect on April 1, 113 types of
projects like infrastructure construction, energy, irrigation, mineral
exploitation, oil and gas, and waste treatment will be compelled to undertake
EIAs.
An EIA includes an analysis and prediction of the potential
environmental impact of specific investments, proposing measures to protect
the environment and potential ways of minimising environmental pollution.
EIAs may be carried out by project licence-holders or by organisations that
specialise in conducting such reports.
Investors will also be compelled to carry out public
consultation with communal people’s committees, local organisations, and
members of the public who will be affected by the projects.
Under the decree, EIAs will be appraised by the Ministry of
Natural Resources and Environment, other relevant ministries as appropriate,
and provincial people’s committees.
Although businesses are currently obliged to carry out EIAs,
the enforcement of this regulation has remained lax.
“Many National Assembly members said it is necessary to force
enterprises to carry out EIAs before their projects are implemented. This
will help businesses to understand their commitments to environmental
protection,” said the National Assembly’s Committee for Science, Technology
and Environment vice chairman Vo Tuan Nhan.
He said the flouting of EIAs by businesses had led to an
increasingly bad environmental situation.
“They implement EIAs just for form’s sake, and never put the
EIAs into practice,” he stressed.
Tran Xuan Vinh, vice head of the central province of Quang
“The EIA for one project is simply copied for another project.
For example, the EIA reports for the Song Tranh 2 and A Vuong hydropower
projects are almost identical, and were done within a short period of time,”
he said.
Vietnam Association for Environmental Impact Assessment
president Nguyen Khac Kinh said that forcing enterprises to carry out EIAs
was good, but how to actually force businesses to implement EIAs was another
problem.
Positively grasping opportunities brought by multi-lateral
agreements
Joining negotiations for the Regional Comprehensive Economic
Partnership (RCEP) and the Trans-Pacific Partnership (TPP) not only brings
enormous economic interests to member countries, but also deepens trade ties
between
At a press briefing in February launching the 40th anniversary
of the establishment of diplomatic relations between New Zealand and Vietnam,
New Zealand ambassador to Vietnam Haike Manning affirmed that many products
from New Zealand, such as milk, apples, kiwifruits and wines, can be found in
many supermarkets and retail outlets in Vietnam while the oceanic consumers
are gradually becoming more aware of Vietnam’s farm products, including
coffee, pepper, cashew nuts and tropical fruits.
It can be said that agricultural products play an important
part in trade relations between the two countries. Many competitive
agricultural products from the oceanic country are available in
The first visit to Vietnam of New Zealand's special
agricultural trade envoy Mike Petersen at the end of 2014 affirmed the
oceanic country’s commitment to boosting agricultural commercial co-operation
and supporting agricultural development in the country.
According to the New Zealand Embassy in
The recent notable co-operative project, which has been
jointly implemented by the Institute for Crop and Food Research of New
Zealand and a number of agricultural research institutes of
According to the Foreign Investment Agency under the Ministry
of Planning and Investment,
In 2014,
The processing and manufacturing industry saw the most
Australian projects, totalling 119 with the total US$1.03 billion investment
capital, accounting for 62.7% of
To enhance investment co-operation between
With the policy of multilateralising and diversifying external
economic relations and efforts in improving the investment environment to
attract further FDI and elevate the capital’s use effectiveness, it can be
forecasted that FDI flow into Vietnam will increase in the future, in which
there will be further projects of Australian investors.
The agreements will open up great opportunities for Vietnamese
exports, particularly farm products, textile, garment and footwear, to
penetrate
Quang Tri introduces business opportunities to Thai firms
More than 70 Thai enterprises were briefed on potential
investment opportunities at a conference held by the central Quang Tri
province People’s Committee.
The conference, taking place on March 18 in the capital city
of Dong Ha, aimed to provide Thai companies with a comprehensive
understanding of the province’s advantages and potential to help encourage
relevant and promising business ideas.
Thai investors asked a number of clarifying questions on
land-lease contracts, the province’s policy on natural resources and the
protection of foreign companies, worker salaries, tariffs and procedures for
bank loans.
Responding to concerns from Thai investors, the province’s
Deputy Chairman Ha Sy Dong said that Quang Tri will create favourable conditions
for Thai enterprises to rapidly and effectively implement investment
projects.
Around 1,200 local and foreign enterprises have been
registered in the province with a total capital of US$2.36 billion, yet only
three are Thai businesses.
The ministries of finance, transport, and industry and trade
will review all the surcharges to see if they violate
Following the inspection, the ministries will also seek the
government’s approval for a proposed list of shipping surcharges that can be
applied in
Last August, trade associations and authorities lamented that
many foreign shipping companies levied unreasonable fees on Vietnamese
exporters and importers.
They said there were 10 kinds of surcharges in total, many of
which were unreasonable.
The Vietnam Leather, Footwear and Handbag Association for
instance said its members must pay US$110 million of surcharges each year to
shipping firms.
Bui Thien Thu, deputy chief of the Vietnam Maritime
Administration, told Thoi Bao Kinh Te Sai Gon (Saigon Times) that Vietnamese
companies must resort to foreign shipping firms as the domestic fleet is
incapable of handling all the cargo.
Thu said shipping surcharges are included in transport fees.
Foreign shipping firms usually reduced transport fees to lure
Vietnamese companies, but then they increased shipping surcharges to make up
for the discount, he said.
Licogi to sell 35% stake to Khu Dong
Infrastructure Development and Construction Corporation
(Licogi) announced its strategic investor will be Khu Dong Real Estate
Investment Limited Company, which will buy a 35 per cent stake in the firm.
Licogi also said it would sell 31.5 million shares to the
investor before the initial public offering (IPO) on April 13 in Ha Noi.
As planned, the corporation will offer nearly 21.27 million
shares, or 23.63 per cent, in an IPO on the northern bourse at VND10,000
(US$0.48) per share.
Licogi did not declare the price of shares sold to Khu Dong
Real Estate Investment Company, but said it would not be lower than the
starting price.
After the sale, plus a 40 per cent stake owned by the State,
Licogi would have charter capital of VND900 billion ($42.86 million).
Licogi is headquartered in Ha Noi's Thanh Xuan District and
belongs to the construction ministry. It is involved in construction work in
urban areas, industrial parks and traffic infrastructure, as well as
hydroelectric and thermo-electric projects.
Licogi has also developed several large real estate projects
in urban areas in Hoang Mai and Cau Giay Districts of Ha Noi, Ha Long and
Uong Bi in the
Khu Dong Real Estate Investment Company was founded in
Vinatex to build textile and garment factory complex
The Viet Nam National Textile and Garment Group (Vinatex) will
commence the construction of a factory complex in the central
The model of factory complex in central
Spread over 20ha in Que Son District, the VND1.14 trillion
(US$53.5 million) project will include a fibre factory that will produce
4,600 tonnes of products per year, a textile and dyeing factory with a
5,000–tonne annual capacity, and Huong An garment factory with 20 knitwear
production lines, which will produce 20 to 25 million products per year.
Vinatex will also build a factory that will treat 5,000cu.m of
wastewater per day to serve the production needs at the complex.
After it becomes operational, the complex will supply
materials to cities and provinces nationwide, including
The project's first phase is expected to earn nearly VND1.7
trillion in revenue per year, contributing about VND30 billion ($1.4 million)
to VND35 billion ($1.64 million) to the local budget, and generating stable
jobs for about 2,000 workers with an average income of VND4 million ($187.7)
to VND5 million ($234.7) per head per month.
The group plans to spend VND9.4 trillion (US$4.4 billion) on
textile and garment, weaving and dyeing and infrastructure projects in the
2015-17 period. About 60 per cent of the capital will be poured into weaving,
dyeing and infrastructure projects to lure other businesses.
In 2015, nearly VND2,425 billion ($113.8 million) will be
disbursed for the above-mentioned projects.
Vinatex has equitised its operations from January 1 this year.
It has set a target for its parent company to earn VND900 billion ($42.25
million) in revenue, and an after-tax profit of VND288.4 billion ($135.39
million) in 2015.
What can be seen from February’s economic data?
In late 2014 many experts forecast that the Vietnamese economy
in 2015 would continue to experience high growth and low inflation, something
which may come true given recent economic data.
The consumer price index (CPI) in February, at the time of the
Lunar New Year, fell by 0.05% from the previous month for the first time in
many years — the fourth consecutive decline in recent months. Such data shows
that actual economic developments came in line with the forecast. During the
Lunar New Year, prices did not rise and even fell slightly, which was good
news for wage earners and made consumers in general feel more confident in
the local currency. However from a regulatory view, the underlying cause of
this abnormal phenomenon should be determined and analysed in order to
address concerns that this may signal deflation and a reduction in purchasing
power.
Commenting on this matter, Minister of Planning and Investment
Bui Quang Vinh gave an explanation that has received widespread agreement. He
said the continuous decline of CPI is not the result of deflation but of
sharp cuts to petrol and oil prices as a consequence of falling global
prices.
Energy output accounts for a large proportion of the price of
many goods and services and the sharp and consecutive reduction in fuel
prices have lowered the price index of transport, housing and building
materials. Such a price fall also acts as a stimulus to investment for
development and social consumption, in contrast with deflation. The economy
is considered to be in a period of deflation when supply outstrips demand,
unsold goods rise and services slump, which leads to a downturn in the
production of goods and services. In
It is notable that core inflation, which excludes items such
as food, energy and State-controlled commodities and services, rose 0.36% in
February against the previous month and 0.6% over December of last year.
Average prices in the first two months of 2015 rose 2.4% year on year.
Meanwhile the index of industrial production (IIP) also went up by 12%,
compared with an increase of 5.4% recorded a year earlier.
In addition to the reduction in petrol and oil prices, another
factor causing the CPI in February to go down was the effort of local
authorities who sought to stabilise prices with an abundant supply of goods.
Moreover, price regulation of goods previously controlled by the State has
been shifted to a market-based mechanism with measures relevant to reality
and more respect for market forces. At the same time, the gradual loosening
of credit policy such as cutting medium and long-term interest rates and
increasing loans, has led the economy to grow in an environment of stable
currency values and commodity prices.
A combination of these positive figures reveals an economic
picture with bright prospects, helping to bolster the confidence of investors
and consumers in the most promising period ahead in recent years. However the
opportunity to foster higher and more sustainable growth in this period lies
in the effort of both the business community and the political system.
Small and medium-sized enterprises, accounting for 97% of
total enterprises in
Property prices are another influential factor and should be
brought down closer to real values affordable to home buyers, who should
switch from hoarding money and waiting for further price declines, to seizing
opportunities to purchase necessary goods, especially buying land and homes
or building and repairing homes.
These above-mentioned analyses and comments are increasingly
considered correct and reliable, coinciding with comments from respected
organisations and individuals such as former UK Prime Minister Tony Blair’s
speech during his meeting with Prime Minister Nguyen Tan Dung. The former
VND10.85 trillion for 2015 price subsidization program
Ten banks will provide businesses with a total of VND10.85
trillion (US$505.24 million) in loans to implement the price subsidization
program in
That was announced at a meeting chaired by the city People's
Committee Deputy Chairwoman Nguyen Thi Hong on March 18 to review the
program's implementation last year and launch 2015 plan.
The city Department of Industry and Trade reported that 86
businesses are expected to attend in the program this year including 76 goods
suppliers and ten banks.
The program will be carried out from April 1, 2015 until March
31, 2016.
According to Ms. Hong, the program was appreciated for its
practical efficiency by the city leaders and citizens last year. She prompted
relevant agencies and businesses to better using the program's logo on
products as well as at shops and supermarkets to improve consumers' awareness
of subsidized products.
Workshop discusses university’s role in social enterprise
development
A workshop was held March 16-17 to highlight the role of
higher education and research institutions in the development of social
enterprises in
At the workshop, 120 delegates, including researchers,
lecturers and education managers from universities, and representatives of
civil organisations and social enterprises, had an opportunity to learn about
the role of their own institutions in promoting and supporting the
development of the sector, important in addressing environmental and social
issues.
The event, organised by the British Council and the National
Economic University (NEU), aimed to promote teaching activities and research
on social enterprises in
According to the British Council, the workshop sought to
strengthen the commitment of universities in incorporating content about
social enterprises in their programmes in order to establish an academic
network on this matter.
Participants at the workshop analysed the status of social
enterprises in
NEU Rector Tran Tho Dat said that in order to encourage the
establishment and development of social enterprises in
Through their teaching and research activities, universities
and research institutions can bring social enterprises closer to the
community, help policy-makers introduce appropriate policies to support this
type of business and help entrepreneurs to select effective ways to develop
their businesses.
ECI Saigon, TEC in construction engineers training deal
Saigon Engineering Construction Investment Corporation (ECI
Saigon) on March 18 clinched a cooperation agreement with the HCMC Vocational
College of Economics and Technology (TEC) to help train construction
engineers and employ graduates from the school.
Nguyen Dang Ly, president of TEC, said students of the
school’s construction faculty can work as apprentices at ECI Saigon so that
they can get practical knowledge and experiences and develop important skills
for teamwork and planning.
ECI Saigon will employee graduates with good academic results
as part of the agreement.
Truong Phu Cuong, general director of ECI Saigon, said
university graduates usually lack soft skills and practical experiences.
Therefore, the company hopes the collaboration with TEC will equip students
with practical knowledge and skills so that they can work for the enterprise
immediately after graduation.
According to the HCMC Center of Forecasting Manpower Needs and
Labor Market, local firms in the architecture and construction sectors need
to recruit 11,000 people a year, or around 4% of the total demand. More job
opportunities will be opened for laborers in these sectors when the ASEAN
Economic Community is established at the end of this year.
VietJetAir determined to take over operation rights to airport
terminal
VietJet Aviation Joint Stock Company has shown its determination
to secure the right to operate Terminal 1 (T1) at
The no-frills carrier said it would partner with some local
investors to operate the domestic terminal at the second biggest
international airport in
Nguyen Thanh Ha, chairwoman of VietJetAir, was quoted by local
media as saying that VietJetAir, the second largest airline in
Ha said VietJetAir pledged to operate the terminal in line
with aviation security and safety regulations and ensure the quality and transparency
of services it provides at the terminal.
The airline proposed the ministry permit it to work with the
Civil Aviation Authority of Vietnam (CAAV), Airports Corporation of Vietnam
(ACV) and other entities under its management to collect related data to
complete the scheme.
Last month, VietJetAir requested the ministry to transfer the
T1 operation right to it within 20 years. Days after, the State-owned Vietnam
Airlines Corporation followed suit, proposing buying the whole terminal for
its own flights.
Vietnam Airlines chairman Pham Viet Thanh was quoted by
Vietnam News Agency as saying that owning a terminal would enable it to
reduce operation costs, enhance the business efficiency of waiting lounges,
check-in counters and other facilities, and improve passenger services at the
terminal.
The national flag carrier wants to use its own capital and
raise money from other sources to buy the terminal.
Jetstar Pacific Airlines is seeking the ministry’s nod to own
the operation rights to the old passenger terminal at
The local enterprises have expressed keen interest in
investing in airports after Transport Minister Dinh La Thang told agencies
under the ministry to map out plans to sell the operation rights to Phu Quoc
airport and part of T1 at Noi Bai airport this year to raise funds for other
projects.
* VietJetAir on March 18 announced a plan to operate four
weekly flights between HCMC and
As scheduled, the airline will operate flights from Tan Son
Nhat airport to Chu Lai airport and vice versa on Mondays, Wednesdays,
Fridays and Sundays. Its Airbus A320 plane will depart from HCMC at 7:45 a.m.
and from Quang
VietJetAir will be the first local no-frills carrier to fly to
Chu Lai airport in the central province of Quang
To attract passengers to the new air route, the carrier is
selling fares from VND9,000 on its website from noon to 2 p.m. every day
until March 26. The promotional program is also applied to its HCMC-Dong Hoi,
Hanoi-Quy Nhon, HCMC-Taipei routes.
Rice prices drop in delta before delivery to Philippines
Prices of unprocessed rice and paddy in the Mekong Delta have
fallen although the nation’s rice stockpiling scheme for the winter-spring
crop has not ended and
Rice export firms in the region now buy fresh IR 50404 paddy
(unhusked rice) at VND4,200-4,350 per kilo and unprocessed rice at
VND6,300-6,400, down VND50-100 a kilogram compared to early this week.
As observed by the Daily, prices in the region rose by
VND100-150 to VND4,300-4,450 a kilogram of fresh IR 50404 paddy and
VND6,400-6,500 a kilogram of unprocessed rice several days after the
Government approved the rice storage program between March 1 and April 15.
The prices were equal to the levels prior to the Government’s
approval for the rice stockpiling program and Vietnam Southern Food
Corporation’s (Vinafood 2) winning of a contract to sell 300,000 tons of rice
to the Philippines late last month.
The price drop is attributable to shrinking export prices,
which stand at US$365-375 a ton of 5% broken rice and US$340-350 a ton of 25%
broken rice.
At a tender organized by the National Food Authority of the
Philippines on February 27, Vinafood 2 was awarded the contract when it agreed
to revise down its bids to US$441 a ton for the first 150,000 tons of rice
and US$421 for the remaining 150,000 tons after Thailand secured 200,000 tons
out of the 500,000 tons on offer at the tender.
The winning bids are CIF (cost, insurance and freight) prices
and the export price offered to enterprises chosen for the stockpiling
program is around US$360 a ton, according to Pham Thanh Tho, deputy director
of food at An Giang Plant Protection Joint Stock Company (AGPPS). AGPPS is
one of the enterprises authorized to carry out the contract.
Oversupply is another reason. Enterprises have bought 120,000
tons out of one million tons of rice for temporary storage under the program,
while farmers in the region have harvested 900,000 hectares out of 1.5 million
hectares of paddy in the 2014-2015 winter-spring crop.
The Vietnam Food Association (VFA) estimated
Jan-Feb real estate deals soar in two biggest cities
The number of successful real estate deals in HCMC and
The latest report by VNREA showed that there were more than
2,300 successful land and home transactions in the two biggest cities of
Last month saw some 1,200 land lots and apartments changing
hands in
In HCMC, transactions last month reached around 1,100, triple
the volume of the same period last year. Customers registered to buy land and
homes at the projects with good progress and in good locations in districts
2, 4, 6 and 7.
VNREA said the prices of land lots and apartments in the
period inched up 1% to 10% despite strong demand, especially in the apartment
segment after the Lunar New Year holiday (Tet).
As observed by the Daily, major real estate enterprises in
HCMC have been busy after the Tet break, which ended on February 24.
Successful deals in the first week after the nine-day holiday ranged from 10
to 50 at Hung Thinh Land, Hoang Anh Saigon, Novaland, Nam Long, Him Lam Land,
and Dat Xanh.
Given the recovering property market, Hung Thinh Land plans to
put up for sale 5,000 apartments for medium and high-income earners this
year, while Him Lam Land will have 2,000 apartments and land lots priced at
VND1-3 billion on offer.
Ngo Quang Phuc, deputy general director of Him Lam Land, said
customers will benefit from more products available on the market rather than
property investors.
“To attract buyers, investors must compete with one another,
set seasonable prices and offer the best payment and financial support
policies possible,” Phuc said.
VNREA estimated the value of real estate inventories at more
than VND73.15 trillion as of the end of February, down nearly VND234 billion
compared to the end of January this year. Of which, the inventories of
apartments were 15,000 units and housing land lots over 8.6 million square
meters.
No Government guarantees for finance organizations possible
The Ministry of Finance is considering lifting Government
guarantees for finance and credit institutions as part of a scheme to cope
with the public debt issue.
The Government still provides credit guarantees for
enterprises in all economic sectors, especially the State sector, finance and
credit institutions, and policy banks like Vietnam Bank for Social Policies
and Vietnam Development Bank.
The ministry is reviewing the implementation of the Law on
Public Debt Management and will send a report to the Prime Minister in the
third quarter. The ministry is expected to propose amendments to the credit
guarantee policy. However, credit guarantees for policy banks are not
mentioned in the proposal.
Truong Hung Long, director of the ministry’s Debt Management
and External Finance Department, recently told reporters that public debt may
surge close to the upper limit approved by the National Assembly (NA) this
year. Therefore, the nation must review all loans and borrowers.
In a report the Government sent to the NA last October, public
debt had been swelling fast and had almost hit the safety level of 65% of
gross domestic product (GDP).
Ending 2014, public debt was put at 60.3% of GDP and the
figure may reach 64% of GDP at the end of this year. Of the figure,
government-backed loans had been soaring 50% a year on average.
The Government guaranteed around VND500 trillion worth of
credit last year and expects to guarantee another VND642 trillion this year.
The ministry so far has not broken down credit for each sector as mentioned
above.
At present, the Government mainly backs banks to lend to huge
projects, mostly those in the power sector.
For instance, in August 2014, the Government issued a letter
of guarantee for a loan worth over US$157 million from LienVietPostBank to
finance a hydropower plant in Laos. If the borrower, Viet Lao Power Joint
Stock Company, fails to pay the loan, the Finance Ministry will have to
settle the debt.
According to the ministry, the removal of Government
guarantees for finance institutions will make it possible to focus resources
on key projects approved by the NA or the Government and arrest the rapid
rise of public debt.
In fact, the ministry is building up a medium-term program on
international government bond issue to mobilize long and medium-term capital,
restructure short-term loans, reduce costs and diversify capital sources for
development investment. The ultimate goal is to reduce dependence on the
Government’s credit guarantees.
Korean enterprises propose investment in Ba Son area
The EUNSAN Shipping & Aircargo Co. Ltd and OUE Ltd from
the Republic of Korea have proposed a US$5 billion project in the Ba Son
Shipyard area in Ho Chi Minh city.
HCMC has approved a master plan to develop the premises of the
current military-owned Ba Son Shipyard in a prime location in the downtown
area into a major commercial, financial and services center.
The architecture of constructions there will be in harmony
with Thu Thiem 2 bridge and the Metro line 1 which connects Ben Thanh Market
and Suoi Tien Theme Park in the city.
EUNSAN is a resourceful and proficient NO.1 freight forwarding
company with a worldwide network of agencies.
Meanwhile, OUE Limited is a diversified real estate owner,
developer and operator with a real estate portfolio located in prime
locations in Asia and the US.
If the proposal is approved, the project will be implemented
on Vietnam’s 70th National Day (September 2).
Vietnam looks to develop low-carbon industrial parks
The Danang seafood service and Lien Chieu industrial parks
have been selected to develop a low-carbon model and assist businesses to cut
emissions under a project started in 2012.
Initial results from the project that was designed to run till
2015 showed the reduction of 1,600 tonnes of CO2 emissions through the
implementation of activities to reduce greenhouse gas emissions.
The information was unveiled at a workshop on building
low-carbon industrial parks held in Hanoi on March 19, according to the Quan
doi Nhan dan (People’s Army) newspaper.
Co-hosted by the Industrial Policy and Strategy Institute and
the Asia Fund, the event was part of a project funded by the UK’s Ministry of
Foreign Affairs.
Solutions and assisting policies for enterprises in Vietnam’s
industrial parks in line with the low-carbon model based on the Danang
results were also discussed at the event.
Cam Ranh airport’s new terminal to be built
Representatives of the Khanh Hoa provincial People’s Committee
and the Vietnam Airlines Corporation had a working session on the investments
and construction of a new terminal for Cam Ranh International Airport in Nha
Trang city, on March 19.
The airdrome is one of the country’s four airports seeing a
rapid growth in terms of the number of passengers.
In 2014, the airport welcomed over 2 million visitors,
exceeding its designed capacity of 1.5 million passengers, and the flow is
expected to grow to 4 million passengers in 2020.
The airport is overloaded and is currently unable to meet
demand, Director of Cam Ranh International Airport Phan Le Hoan, said,
stressing the need to build Terminal 2.
According to a preliminary draft project, the new terminal has
a total investment of over VND1 trillion (US$46.5 million) covering
15,000 square metres of land and will be used to serve international flights.
The existing terminal will serve domestic flights.
Chairman of the provincial People’s Committee Nguyen Chien
Thang said the project is in line with the province’s development strategy in
an attempt to bring Khanh Hoa to become a socio-economic hub in the southern
central region.
Earlier, the province implemented a project to build the
runway No.2 for the airport. The project, which has a total investment of
nearly VND1 trillion sourced from the State’s budget, is expected to put into
operation in early 2018.
Bad US weather hurts VN seafood exporters
Vietnamese seafood exporters are expected to encounter
difficulties due to bad weather in the United States and the recent
depreciation of the euro against the US dollar.
Data from the Ministry of Agriculture and Rural Development
showed that the country's seafood exports during the first two months of the
year touched US$907 million, down 9.4% over the same period last year.
Exports to the United States, the largest importer during
January, dropped sharply by 37% to around US$90 million, compared with the
same period last year.
Truong Dinh Hoe, general secretary of the Vietnam Association
of Seafood Exporters and Producers (VASEP), told online newspaper ndh.vn that
the slump was due to seafood demand in the United Stated having been adjusted
in view of increased buying at the end of last year.
In addition, seafood inventory in the United States last year
was deemed relatively high, resulting in imports being halved after reviewing
consumption trends this year.
Another reason was the record cold weather, preventing
Americans from stepping out and shopping.
The latest report from the US Department of Commerce released
on March 12 showed that its retail revenue in February also slipped 0.6%,
marking the third consecutive month seeing a slump.
Domestic seafood exports to the European Union and Japan, the
biggest import market following the United States, were also reduced because
of the depreciation of the euro against the US dollar.
The currency has fallen by more than 12% against the US dollar
over the last two months to its lowest level in 12 years. This has forced
importers to spend more euros to buy US dollar and resulted in Vietnamese
exports becoming more expensive, despite selling prices remaining unchanged
in dollar terms.
Hoe said nearly 90% of Vietnamese seafood export transactions
were calculated in US dollar. This was the reason that any change in foreign
exchange would also impact exporters.
The depreciation in the yen was also creating difficulties for
Vietnam's seafood exports.
Exports to the market during January were 10% lower at US$75
million, than a year ago.
VASEP's Hoe said it was hard to forecast the prospects of
seafood exports. Even though the United States sharply cut anti-dumping
tariffs imposed on Vietnamese shrimp from 6.37% to 0.93%, this would not
boost purchases immediately as the new tariffs would only take effect in
July.
However, the decision had raised the expectations of exporters
for future business. Earlier, VASEP had set a seafood export target of US$8
billion for 2015.
Nine unauthorised cable channels halted
Nine unauthorised foreign channels will stop airing in
Vietnam, stated Truong Minh Tuan, Deputy Minister of Information and
Communications, on March 19.
Three local cable network providers -VTV Cab, AVG, and
Viettel- have long broadcasted those channels without official approval,
including True Sport HD, OPT1, Golf HD, Russia Today, True Tennis HD, and
four VOD piloting channels.
After a careful inspection, the Authority of Broadcasting and
Electronic Information under the Ministry of Information and Communications
required that all three broadcasters halt the telecast of the nine channels
and submit detailed reports.
Source :
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Chủ Nhật, 22 tháng 3, 2015
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