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BUSINESS IN BRIEF 24/5
Vietnam
attends economic integration talks in Argentina
A
representative from the Vietnam Trade Office in
He also
talked about opportunities to invest in
Two-way
trade turnover increased from US$830 million in 2010 to US$1.9 billion in
2014.
Ambassador
Felipe Frydman who had worked in ASEAN countries for several years spoke
highly of
The
talks draw the participation of a large number of businesses, and experts and
students on trade and economics.
Similar
talks were held by the CEECI with representatives of Russian, Chinese,
Ecuadorian, Bolivian and Venezuelan embassies earlier.
Local
food showcased in IFEX Philippines
A
Vietnamese business delegation is attending the International Food Exhibition
(IFEX) Philippines 2015 held in
Four
businesses namely Vinamilk, Trung Nguyen Coffee, Trung Thanh Food and HOGANO
are showcasing their products in four pavilions.
ViNa Gourmet
Ville –
Vietnamese
businesses introduced the Filipino and international visitors to
Master
Chef Vietnam 2014 Hoang Minh Nhat joined the event and prepared Vietnamese
dishes to serve visitors.
After
visiting the Vietnamese pavilions, Vietnamese ambassador in the Philippines
Truong Trieu Duong affirmed that the Vietnamese embassy in the
The
four-day event was organised by the Philippine Department of Trade and
Industry (DTI) to mark APEC 2015
NA
asked to pass 2013 budget deficit
The
Government requested the National Assembly pass a budget overspending of
VND41.26 trillion (US$1.9 billion) on day one of the legislature’s ninth
session in
On
behalf of the Government, Minister of Finance Dinh Tien Dung told National
Assembly (NA) deputies on May 20 afternoon that the nation’s budget overspending
in 2013 swelled to 6.6% of the gross domestic product (GDP), much higher than
approved by the NA.
Dung
explained that in 2012, the NA issued a resolution approving 2013’s budget
deficit of VND162 trillion (US$7.4 billion), or 4.8% of GDP, but then revised
up to VND195.5 trillion, or 5.3% of GDP.
However,
the State budget overspending amounted to VND236.7 trillion in 2013, or 6.6%
of GDP, Dung said.
The
higher-than-approved overspending indicates the NA’s budget resolution was
not respected.
Explaining
the figure, Dung said the nation had to spend an additional VND29.4 trillion
as reciprocal capital to have official development assistance (ODA) disbursed
and an extra VND13.2 trillion as value added tax rebates induced in 2011.
Of the
extra spending on counter capital in ODA projects, nearly VND28.7 trillion
went to projects whose construction had to be accelerated such as
In a
review of the State budget in 2013, chairman of the NA Finance-Budget
Committee Phung Quoc Hien said the higher-than-approved spending indicated
that there was no fiscal discipline.
However,
Hien suggested the NA approve the overspending.
Minister
Dung said the Government also managed to cut spending from domestic sources
by over VND1.3 trillion to over VND41.26 trillion in 2013.
To
offset the deficit, Dung said the Government borrowed over VND180 trillion
from domestic lenders and external loans of VND56.4 trillion.
Ending
2013, government debt was 42.6% of GDP, foreign debt 37.3% of GDP, and public
debt 54.5%. The figures were still within the limits approved by the NA, Dung
said.
HVG
to buy five million of its own shares
Hung
Vuong Joint Stock Company (HVG) announced that it will buy five million of
its shares on the market for a maximum VND90 billion (US$4.17 million).
HVG can
purchase the shares through a negotiation between sellers and buyers, trading
orders, and in large share packages on the HCM Stock Exchange (HSX).
The
transaction must be completed within 30 days after it is approved by the
State Securities Committee, and HVG is responsible for publishing the
information about the transaction on the market.
In the
first quarter of this year, HVG's revenue was VND3 trillion ($139 million)
and its after-tax profit was VND37 billion ($1.7 million), 16 per cent of
this year's revenue and 7.4 per cent of this year's pre-tax profit.
The
company said its revenue and after-tax profit in the first quarter decreased
when compared with last year's figures as it could not sell products during
the New Year and Tet holiday while it still had to pay salaries, interests,
and other expenses.
Bad
debts decline at Sacombank
The bad
debt ratio of Sai Gon Thuong Tin Commercial Joint Stock Bank (Sacombank) fell
from 1.46 per cent to 1.19 per cent during the first quarter of this year.
Further,
according to the bank's Q1 report, its after-tax profit reached VND637
billion (US$30.33 million), up 3 per cent over the same period last year.
Also, net revenues expanded 24 per cent year-on-year at VND1.94 trillion
($92.38 million).
The
bank's total asset value reached VND198.74 trillion ($9.46 billion) on March
31, an increase of 5 per cent from the 2014 year-end figure. Also, deposits
at the bank grew 5 per cent to VND171.1 trillion ($8.15 billion) and
outstanding loans increased 4.7 per cent to nearly VND134 trillion ($6.38
billion).
However,
operational costs rose by 11 per cent year-on-year to VND1.10 trillion
($52.38 million), and the provisional value extracted by the bank to support
risks was 3.5 times higher in Q1/2015 than that recorded in Q1/2014, reaching
VND332 billion ($15.81 million).
Support
industry gets strong backing
Under a
contract signed by the three parties Wednesday, they will cooperate in
organising two large-scale exhibitions on the support industry – the Viet Nam
Manufacturing Expo 2015 and the sixth Exhibition on Support Industries in Ha
Noi 2015, at the International Centre for Exhibition in Ha Noi from September
10-12.
The Viet
Nam Manufacturing Expo 2015, which will be hosted by Reed Tradex, will focus
on mould making and plastic injection technologies.
Meanwhile,
the sixth Exhibition on Support Industries in Ha Noi 2015, co-organised by
Vietrade and Jetro Ha Noi, will facilitate the procurement processes of
industrial parts and components for automobiles, motorbikes, electronics,
metal, plastic products, and packaging materials.
Dong
Nai stable market leads export turnover rise
Export turnover
in the southern
The
province's export turnover in May is estimated to reach US$1.1 billion, up
7.3 per cent compared to the same period last year.
Some
products are expected to have particularly high export turnover, such as
computer spare parts and transport vehicles (34 per cent), electrical
products (25 per cent) and cashew nuts (40 per cent).
Major
markets including the
According
to the department's director, Le Van Danh, the province aims to bring home up
to $14.6 billion, an increase of 10-12 per cent against the previous year,
from exporting local products.
LienVietPostBank
announces pre-tax profit in Q1
Lien
Viet Post Joint Stock Bank (LienVietPostBank) yesterday announced that its
total pre-tax profit rose by 15.2 per cent to VND212 billion (US$9.8 million)
in the first quarter of this year.
However,
the bank set aside VND98 billion ($4.5 million) from the pre-tax profit for
provision to deal with bad debts and financial risks.
Hence,
the bank recorded a pre-tax profit of VND115 billion (US$5.3 million) in the
first quarter of this year, a decrease of 37.7 per cent over last year.
The bank
also reported that it achieved a credit growth rate of 16.2 per cent in the
first quarter, with a total outstanding loan of VND48 trillion ($2.2
billion).
The bank
reported a total deposit of VND81.3 trillion ($3.76 billion), an increase of
4.5 per cent, while its total assets increased by 2.4 per cent to VND103
trillion ($4.77 billion).
According
to the bank, it recorded further losses in some sectors, including foreign
currency exchange, with a loss of VND4 billion ($200,000) compared to last
year's profit of VND13 billion ($600,000), and securities investment with a
profit of VND9 billion, a decrease of 81.6 per cent over last year.
FLC
makes bid to buy hospital stake
Property
developer FLC Group has proposed the Ministry of Transport to allow it to buy
all the shares of the strategic investors of
The
group, which owns nearly VND4 trillion (US$183.48 million), has pledged to
provide the hospital with capital investments in facilities to improve its
services. In the healthcare field, the group has invested in and owns 100 per
cent shares of Ha Thanh General Hospital in Ha Noi.
FLC
group is one of many investors queuing to buy the hospital's shares. They
include domestic firms Vingroup and T&T Group as well as foreign
investors from
Earlier
in March, the Transport Ministry submitted the hospital's equitisation plan
to the Prime Minister. Under the plan, the hospital will sell a part of
State-owned capital contribution and issue bonds to increase its charter
capital.
The hospital
is worth VND158 billion ($ 7.4 million), which includes 86 per cent of the
State capital. After the equitisation, it is expected to have a charter
capital of VND168 billion ($7.8 million), equivalent to 16.8 million shares.
In the
initial public offering (IPO) launch, the State will hold 30 per cent of
charter capital, while the hospital's staff will have 8.7 per cent. As many
as 30 per cent will be for strategic investors and the remainder 31.3 per
cent will be auctioned in public.
The
seven-storey building, built on nearly 17,000sq.m, has been equipped with
advanced healthcare facilities and 200 beds. It was built on capital from the
OPEC Fund for International Development's official development assistance.
The
hospital will be the first public healthcare centre in
The HCM
City People's Committee has instructed the Department of Transport to
consider a proposal to upgrade a section of the National Highway No 1 A
between the Tan Kien Intersection in Binh Chanh District and the Long An
Province border.
The
proposal by the Infrastructure Development and Investment Joint Stock Company
(IDICO) includes widening of the 8.2km section from 25m to 38.2 m, the same
as the section of the highway between the Station 2 Intersection (in Thu Duc
District) and Tan Kien.
The
section has eight lanes with separators between them, and pavements measuring
3 to 4 metres wide on either side.
IDICO
will arrange an estimated VND750 billion (US$34.4 million) for the work, which
will be carried out under the BOT (build – operate – transfer) mode,
according to Tuoi Tre (Youth) newspaper.
Banks
use profits for risk provision
Large-sized
commercial banks had to set aside nearly half of their profits for credit
risk provision in the first months of the year.
The move
had been in accordance with the State Bank of
Circular
02, which came into effect early this year, strictly regulates asset classifications,
the levels and methods of risk provisioning, and the use of provisions to
handle risks in the operation of credit institutions and the branches of
foreign banks.
According
to banks' statistics, 10 of them had to use nearly VND7.6 trillion (US$350.23
million) as risk provision funds, accounting for 46 per cent of their
pre-provision profits, in the first quarter.
The
ratio has been higher than that of the first quarter of last year, when risk
provision often accounted for roughly 35 per cent of banks' profits. However,
it remained lower than that of the fourth quarter of last year, when banks'
risk provision represented 56 per cent of banks' profits.
In Q1
this year, Techcombank was at the top of the list, with about 77 per cent of
its pre-provision profits, or VND1.387 trillion ($63.92 million), set aside
for risk provision funds. Vietcombank and Vietinbank also used 51 per cent of
their pre-provision profits, equal to more than VND1.5 trillion ($69.12
million) for credit risk provision, while the Bank for Investment and
Development of Viet Nam (BIDV) roughly used 30 per cent of its VND3.251
trillion ($149.815 million) profits on provision.
The SHB
also had to keep VND397 billion as risk provision funds.
Previously,
the Tien phong (Vanguard) online newspaper reported estimates by Saigon
Securities Inc researchers, which said that domestic banks will have to
establish provisional funds, with a total value of about VND37.6 trillion
($1.732 billion), for bad debts this year. The figures were based on bad loan
handling situations and current regulations.
It is
expected that the funds, which equal nearly half of the pre-provision profits
that banks are set to earn in 2015, will help reduce the NPL ratio of the
entire banking system from 3.25 per cent in late 2014 to less than 3 per cent
by the end of this year.
Iran,
Vietnam enhance investment and trade cooperation
Vietnam
Ambassador to Iran Nguyen Hong Thach has made a two-day working visit to
Esfahan province with the purpose of seeking opportunities for investment
cooperation and trade promotion between the two nations’ businesses.
During
the visit, Ambassador Thach toured economic and cultural establishments in
Esfahan’s Mohammadabad city.
Thach
and Mohammadabad Mayor, Mehdi Nasr Esfahani at their meeting informed each
other about the potential strengths as well as the cultural identities of
their respective nation and agreed to sign a Memorandum of Understanding
(MoU) between the Vietnam Embassy in Iran and Mohammadabad City on tourism
cooperation and cultural exchange.
On the
occasion, the Vietnamese diplomat also discussed economic and tourism
cooperation between Vietnam and Iran and the possibility of exploring
sailplane services in Esfahan, and visited asphalt production and steel
facilities, the petrochemical industrial zone and the biggest Hyper Esfahan
trade centre.
Some
Esfahan businesses expressed their desire to step up cooperation with their
Vietnam counterparts and pledged to finance Vietnam entrepreneurs’ trip to
Iran for seeking cooperation opportunities in the time ahead.
JETRO
boosts cooperation with Vietnamese enterprises
Japan
External Trade Organization (JETRO) has issued a list of the 150 outstanding
Vietnamese enterprises with an aim of promoting exports of Vietnamese
products to the Japanese market.
The list
was released by Hanoi JETRO Chief Representative, Atsuke Kawada at the 6th
Vietnam-Japan Exhibition on Supporting Industries which took place on May 20.
Director
of Vietnam Trade Promotion Agency (VIETRADE), Bui Huy Son said that the
agency and JETRO will cooperate to organise another support industry
exhibition from September 10-12.
At the
event, 50 Japanese companies will showcase a number of products they want to
buy from Vietnamese producers.50 local businesses will have a chance to
introduce their quality manufactured goods to Japanese customers.
Son
added that the exhibition will act as an opportunity for businesses to find
industry partners and promote exchange.
Vietnam
food watchdog reassures consumers amid fake rice rumor
The
Vietnam Food Administration (VFA), the country’s food safety watchdog, has
asked members of the public to settle their nerves as a rumor about fake rice
made of plastic is sweeping through several Asian countries.
The VFA
is cooperating with relevant forces to verify the information and will notify
the public as soon as possible, according to an announcement posted on its
website on May 20.
The
watchdog also “recommends that people should not panic,” adding consumers
should notify local agencies immediately if they find anything abnormal in
the rice they eat or sell.
Rice is
present in almost every meal of the Vietnamese, and the Southeast Asian
country is also one of the world’s largest rice exporters.
A rumor
of Chinese-made fake rice has circulated on popular social networks since
early this week, according to Singaporean and Malaysian media.
The
Vietnamese press also reported the news, thus worrying members of the public
and prompting the VFA to reassure them, the food safety watchdog said.
The plastic
rice is reportedly made from potatoes or sweet potatoes, with synthetic resin
molded into the shape of real rice, according to The Straits Times.
The
poisonous fake rice, which is also said to stay hard once cooked, is rumored
to have entered many countries such as Singapore, Malaysia, India, Indonesia,
and Vietnam, the Singaporean newspaper said on May 19.
Food
safety watchdogs in these countries are verifying the news, with Singapore’s
Agri-Food & Veterinary Authority asserting that they have so far “not
received any feedback on fake rice," according to The Straits Times.
Rumors
about fake rice also flew through Vietnam in 2011 and 2012, but authorities
later confirmed these were all false, according to the VFA.
Thai
firm replaces Swiss company to manage HCM City hotel
Thailand-based
Absolute Hotel Services (AHS) has taken over the management role in a
five-star hotel under the management of Switzerland-headquartered Mövenpick
Holding AG in Ho Chi Minh City.
The
takeover was completed with the opening of Eastin Grand Hotel Saigon,
formerly known as Mövenpick Hotel Saigon, on Nguyen Van Troi Street, Phu
Nhuan District on Wednesday, the hotel said the same day in a press release.
Le Duc
Binh, deputy general director of A-1 International Vietnam Corporation, the
Vietnamese owner of the hotel, said at the opening ceremony that this is the
third time in 21 years that the firm has changed the management group for the
property.
The
hotel, opening in 1994 as Ho Chi Minh City’s first international hotel, was
known as Omni Saigon Hotel and changed its name to Mövenpick Hotel Saigon in
July 2008.
“Due to
some specific reasons, like other companies owning many popular hotels in
Vietnam and around the world, we have appointed a new professional management
company to manage our hotel,” Binh said.
“This is
a normal move of the owning company for better performance to meet desired
results,” he added.
Eastin
Grand Hotel Saigon, consisting of 268 well-appointed deluxe rooms and suites,
all of which are equipped with modern amenities and provide large conference
rooms and a variety of dining options.
With the
official opening, the new hotel is now part of the Eastin chain of 61
international hotels and residences covering Thailand, Vietnam, Indonesia,
Myanmar, India, and the Middle East.
CPI
keeps rising throughout Vietnam
The
consumer price index (CPI) for May showed continued growth in Hanoi and HCM
City, reported the cities' statistics offices.
The
Hanoi Statistics Office announced on May 21 that the capital city's CPI
showed a month-on-month increase of 0.12% over April and a year-on-year surge
of 0.93%.
The
office said the increase was mainly due to a surge in petrol price since May
5 that pushed many commodity prices up, especially transport items, which
jumped 1.06% since last month.
Housing,
electricity, tap water, fuel and building materials jumped 1.44% in the last
month because of the rising price and demand for electricity and tap water in
the summer, the office said.
Other
goods also showed growth - 0.47% for drink and tobacco; 0.3% for garments,
hat and footwear; and 0.28% for cultural, entertainment and tourism services.
Only
restaurant and catering services had a price reduction, which was 0.43%
compared to April.
In
contrast to the CPI, the price of gold in Hanoi continued its decline by
0.13% in the last month and the price of the US dollar went up 0.44%against
last month.
The HCM
City Statistics Office said the city's CPI only had a slight increase of 0.3%
over April.
Goods
with price growth included garments, hat and footwear up 0.1%; home
appliances up 0.02%; transport services up 1.05%; and cultural, entertainment
and tourism services up 0.07%.
Housing,
electricity, tap water and fuel jumped 2.18% against last month because of
the new electricity rates and increase in demand due to the hot summer
weather.
Some
goods items reduced in price. Like Hanoi, restaurant and catering services
went down 0.06%. Postal and telecom services declined 0.02%, and the
other-goods and services group fell 0.04%.
Of note,
rice continued its reduction by 0.13% and general food products went down
0.13%.
In HCM
City, the price of gold also dropped 0.4%.
Five-star
hotel inaugurated in HCM City
The
five-star Eastin Grand Hotel Saigon was officially opened on May 20 in Ho Chi
Minh City, marking the first presence of the Eastin brand in the city.
The
hotel, which has 268 deluxe rooms and suites equipped with modern amenities,
provides large conference rooms with precise facilities and dining options.
Eastin
Grand Hotel Saigon is part of the Eastin chain of international luxury hotels
and residences covering Southeast Asia, India and the Middle East.
As of
the end of the first quarter of 2015, HCM City had 99 hotels with a combined 13,100
rooms, according to Savills Vietnam’s statistics.
Four new
five-star projects are expected to come on line this year, raising the total
stock of this segment by 22 percent.
Ministry
works on farm export issues
The
Ministry of Industry and Trade has proposed that the Government should
establish a working group to resolve difficulties faced by enterprises in
consuming and exporting farming and fishery products.
Deputy
Minister of Industry and Trade Tran Tuan Anh said the group would have
regular meetings with enterprises and associations of the farming and fishery
sector to produce timely solutions for difficulties faced by the enterprises
as well as for meeting the needs of the market, reported the Nong thon ngay
nay (Countrysite Today) newspaper.
The group
would ensure efficiency in exporting these products to enable the country to
reach its export target for 2015, Anh said.
The
trade offices of Vietnam via the group would recognise the difficulties faced
by local enterprises in exporting goods to foreign countries and would know
exactly what kind of support the enterprises need, he said. The offices would
also provide market information to the local enterprises regarding the demand
for Vietnamese farming and fishery products.
Tran
Thanh Hai, deputy director of the ministry's Export-Import Department, said
the group would make note of export problems to resolve them as quickly as
possible, including the problem of fruit trucks being held up at border gates
and the problem of goods receiving warnings or being returned or seized by
import markets for not meeting quality standards.
Pham Vu
Ha, General Secretary of the Vietnam Cassava Association, said farming
products have stalled at border gates because the farmers and enterprises had
no knowledge about the import markets, and the policies on support for
enterprises from the production to consumption stages were vague.
Ha fears
the group would be unable to resolve many of the more complicated problems in
consuming and exporting farming and fishery products because of the numerous
challenges involved in exporting those products.
For
instance, trade activities at border gates involve customs officers, border
police and local authorities along the border, he said.
Nguyen
Hoai Nam, Deputy General Secretary of the Vietnam Association of Seafood
Exporters and Producers, said if the ministry and trade offices in foreign
countries provided precise information about the export market, the problem
of farming products being held back at border gates would be resolved.
Economic
expert Pham Tat Thang suggested that the group should cooperate with the
relevant sectors in managing farming production to meet the market demand.
Vietnamese
products showcased in Myanmar
The
Vietnam-Myanmar Trade, Service and Tourism Exhibition 2015 (Ho Chi Minh City
Expo 2015), organized by HCM City’s Investment and Trade Promotion Centre,
opened in Yangon city of Myanmar on May 21, according to Saigon Giai Phong
newspaper.
The
city’s 80 leading enterprises are displaying a variety of products ranging
from processed food, household utensils, garment, textile, electronics, and
interior decorations at 125 stands.
A
highlight of the fair is a “Common House” introducing achievements in
politics, culture and economics of Vietnam and Ho Chi Minh City in particular.
Addressing
the opening ceremony, Vice Chairwoman of HCM City People’s Committee Nguyen
Thi Hong said the annual expo is an effective bridge connecting Vietnamese
enterprises with Myanmar customers, and helps the two countries’ enterprises
exchange information and seek new business opportunities and partners.
The
exhibition will run until May 26.
Vietnam
now ranks eighth among foreign investors in Myanmar with seven projects worth
513 million USD. Two-way trade reached 480 million USD last year and enjoyed
an average growth rate of nearly 40 percent between 2010 and 2014.
Trade
between the two countries is expected to hit 1.5 billion USD in the next two
years and 1.7 billion USD by 2020.
SMEs
called to develop e-commerce
It is
advisable for small- and medium-sized enterprises (SMEs) to utilise
information technology such as e-commerce to increase their competitiveness
in the global economic environment.
Businesses
should also prepare measures to grab opportunities and cope with challenges
posed by new generation free trade agreements (FTAs), trade experts
recommended at a workshop on May 20 in the northern province of Hai Phong.
Participants
heard about the current situation and development trend of e-commerce in Asia
and Vietnam in particular.
They
were told that Vietnam could sign a number of bilateral and multilateral free
trade agreements with foreign partners in 2015, including the Trans-Pacific
Partnership (TPP) agreement, the trade pacts between Vietnam and EU; Vietnam
and the Republic Korea; Vietnam and the Customs Union of Belarus, Kazakhstan
and Russia .
The low
tariff regulated in the deals is expected to help the country to expand trade
relations with overseas partners.
Nguyen
Van Thoan, a representative from the Vietnam Chamber of Commerce and Industry
(VCCI), said sales from e-commerce transactions between businesses and
customers in Vietnam topped 2.97 billion USD in 2014.
E-commerce
is expected to become an important tool to develop SMEs since it helps
connect local businesses with partners and customers around-the-clock and
around the world, while cutting marketing costs.
To grab
this opportunity, businesses should build and develop their own online brand
names.
According
to Nguyen Van Hoc, Director of the southern branch of PA, one of Vietnam’s
leading domain registration and web hosting companies, the selection of the
domain name is the first step to build an online brand name successfully.
Vietnam
Airlines moves to join SkyTeam alliance
Vietnam
Airlines signed an agreement with SkyTeam on Wednesday in a move to join the
global airline alliance, probably next year, enabling the national flag
carrier to fly to more markets and provide more benefits to passengers.
Pham
Ngoc Minh, general director of Vietnam Airlines, described the agreement the
airline signed in Hanoi as important as it was the first step for the carrier
to become a full member of SkyTeam, hopefully in 2010.
“The
agreement confirms Vietnam Airlines’ position as a major airline in the
region and a global reliable partner of SkyTeam in competing with other
global airline alliances,” Minh said in a statement.
Minh
added Vietnam Airlines would be able to provide passengers with thorough
services in accordance with international standards of SkyTeam when the
airline became a full member of the world’s second largest airline alliance
after STAR Alliance.
Vietnam
Airlines said in the statement that it was the only partner airline in
Southeast Asia that SkyTeam had chosen to become its member.
Speaking
to reporters after the signing on Wednesday, the air carrier’s deputy general
director Duong Tri Thanh said joint operations, frequent flyer programs and
airport services would be the three areas of most important cooperation among
alliance members. Thanh said Vietnam Airlines had considered three air
alliances over the past ten years before deciding to apply for SkyTeam
membership.
Dominique
Patry, chairman of SkyTeam Steering Committee, said Vietnam Airlines would
give great support to the flight network of SkyTeam and help expand its
presence, especially in Indochina.
“With
wide flight coverage and services to more than five gateway airports of
SkyTeam, Vietnam Airlines will be a strategic partner of SkyTeam,” said
Patry, who is Air France’s vice president for international affairs and
alliances.
He told
reporters it often took airlines some two years to complete all admission
formalities, but “I hope Vietnam Airlines will complete all formalities
within 12 months.”
Vietnam
Airlines now uses 50 aircraft of different types including Boeing 777s,
Airbus A330s, A321s and A320s for its flights to 20 domestic destinations and
24 international destinations.
Despite
the global economic turmoil, Vietnam Airlines last year posted a year-on-year
revenue increase of 31.32% to more than VND26.6 trillion (over US$1.5
billion), including pre-tax profit of VND240 billion (some US$13.7 million).
The
significant pre-tax profit marked a great achievement for Vietnam Airlines as
this carrier incurred a loss of VND83 billion (more than US$4.7 million) in
the first half of 2008.
Vietnam
Airlines is looking to transport nearly 9.5 million passengers on its
domestic and international flights this year, as against more than 8.8
million passengers last year.
Minh
said earlier this year that 2009 would be a difficult year for the airline
industry but the carrier would continue to improve competitiveness and kept
following a long-term development strategy to become the second largest
airline in the region after Singapore Airlines in the next seven to eight
years.
Established
nine years ago, SkyTeam now has 10 member airlines and three associate
airlines including Air France-KLM, Continental Airlines, China Southern,
Korean Air, and Northwest. These carriers with 2,500 airplanes now operate
flights to 905 destinations in 169 countries and territories, transporting
462 million passengers a year.
Vietnam’s
farm produce to find Japan’s market wide open
Japan
will open its market wider for Vietnam’s farm produce from July this year by
slashing most tariffs to between 0% and 5% and ease many quantitative
restrictions under the Vietnam-Japan Economic Partnership Agreement,
officials said.
Speaking
at a conference organized here on Tuesday by the Ministry of Industry and
Trade and the HCMC government to disseminate information on the agreement,
they said a wide range of products would enjoy preferential tariffs, but farm
produce will benefit most.
Le Trieu
Dung, head of the ASEAN Office of the ministry’s Multilateral Trade Policy
Department, said the agreement provides the most preferential tariffs
compared to other agreements that Vietnam has signed with other countries.
The country is finalizing all procedures for the validity of the agreement,
which was signed on December 25 by the two countries, from early July this
year, he told some 300 business executives joining the conference.
Trade
liberalization between the two countries will be strong for such groups of
items as fishery, garment, steel, and electronics, according to the
agreement, which specifies that over 7,250 Vietnamese products out of the
total 9,100 will enjoy 0% tariff. Shrimps of all types, for example, will see
the tariff from between 10% and 15% now slashed to 0%.
Under
the agreement, Vietnam pledges to liberalize 87.66% of trade turnover with
Japan within ten years while the northeast Asian country will liberalize
94.53% of the trade volume. Almost all the tax rates on Vietnam’s industrial
products to Japan will enjoy a low rate of 0-5%.
Dung
stressed the greater benefits for Vietnam’s agricultural products.
“Japan
will slash 83.8% of tariffs on Vietnam’s farm produce within ten years,” he
said, adding that 23 of the 30 farm and aquatic products that have the
biggest export turnover to Japan will immediately enjoy a tax rate of 0%
within 10 years,” he said.
Some of
the farm and aquatic products that are advantageous to Vietnam such as
shrimp, crab, bee honey, durian, garlic, ginger, and litchi among others will
enjoy sharper tax cuts than the products of other ASEAN countries.
Quantitative
restrictions will also be lifted gradually. For example, Japan will reserve
an import quota of 100 tons of bee honey for Vietnam’s exporters each year,
then raise up to 150 tons annually with a fixed tax rate of 12.8%.
In 2008,
Vietnam’s export to Japan generated revenue of some US$8.5 billion, an
increase of 37% over the previous year. Japan is the second largest export
market for Vietnam after the U.S.
Dao Tran
Nhan, deputy director of the ministry’s Department of Asia and Pacific Ocean,
told the conference that as a whole, Vietnam’s export products have been
accepted in Japan, but with a very modest market share, and the agreement is
poised to help change the picture.
Nhan
said that the market share for Vietnam’s products in Japan is only some 1.19%
of the total import revenue of Japan, while other nearby countries such as
Malaysia, Thailand, Indonesia and China are respectively taking market shares
of 3.05%, 2.73%, 4.27% and 18.83%.
Nhan
predicted some items that Japan will need in large amounts in the coming time
include processed foods, fresh vegetables and flowers, household mechanical
products and household plastic products.
Australian
steel maker launches specialized products
BlueScope
Steel Vietnam on Wednesday launched new Clean COLORBOND steel products for
manufacturing facilities as well as curved roofs and walls of structures in a
move to further tap the local market.
Le Anh
Tuan, vice president of the Australian-invested company, said the pre-painted
steel products were made with zinc-aluminum coating and anti-fungus
performance.
“BlueScope
Steel turns out the products in various colors to meet diverse needs of
companies for developing industrial facilities including retail and wholesale
stores in Vietnam,” Tuan told the Daily before the launch ceremony in HCMC.
He
underscored the importance of having new products to provide project
developers with more options for construction materials in a time of falling
demand due to the impact of the global economic turbulence on the world’s
steel industry.
“Vietnam’s
steel industry is not an exception,” Tuan said. He quoted sources including
the Vietnam Steel Association as saying that steel makers in this market had
seen their turnover fall by at least 30% over the past six months.
Earlier
this year, the association estimated domestic steel production in the first
quarter plunged by 24% year-on-year to 761,000 tons while steel consumption
slumped by up to 71% compared to the year earlier period to around 700,000
tons.
“BlueScope
Steel Vietnam faces the same difficulties,” Tuan said, pointing out the
decline in foreign direct investment (FDI) in the country in recent months as
one of the reasons.
The
Ministry of Planning and Investment’s figures showed Vietnam drew over US$6
billion in FDI including injected capital in operational projects in the
January-March period, down nearly 40% year-on-year.
However,
Tuan said BlueScope Steel was optimistic about Vietnam’s steel market as this
was a developing market and many investors would return and come to build
factories in this market.
“New
opportunities come when investors return to Vietnam again as they will need
steel, especially the quality products,” Tuan said.
Currently,
BlueScope Steel Vietnam turns out pre-painted and zinc-aluminum alloy-coated
steel sheets in addition to other steel materials. The company has operated a
US$105-million metallic coated and painted rolled steel mill in Phu My 1
Industrial Zone in the southern province of Ba Ria-Vung Tau since November
2005.
The facility
includes a 125,000 ton per annum metallic coating line and 50,000 ton per
annum paint line.
Banks
post stronger loan growth
Banks
nationwide had reported credit growth of 3.69% as of May 8 against the end of
2014, much higher than in the same period of previous years.
Data of
the Credit Department under the State Bank of Vietnam showed that credit grew
a mere 1.31% a year ago, Vietnamplus reports.
Bank
loans grew stronger in Hanoi City and HCMC. Total outstanding loans in Hanoi
were estimated at VND1,077 trillion (US$49.5 million) as of April, up 6.6%
against last December, suggesting that local banks saw an improvement in
lending.
Banks in
Hanoi had mobilized a total of over VND1,257 trillion (US$57.7 million) as of
last month, a year-on-year rise of 5.5%.
Earlier,
the central bank’s HCMC branch reported higher credit growth in the city in
January-April than the same period of previous years. Bank loans were
VND1,120 trillion in the first four months, rising 4.14% against the end of
2014. Loans in Vietnam dong grew 4.5% to VND944 trillion. Medium- and
long-term loans inched up 7.6%. Enterprises took out nearly VND31 trillion
worth of preferential loans through the city’s bank-business capital program.
In the
period, banks in HCMC saw capital mobilization increasing 1.91% to more than
VND1,300 trillion in the first four months of this year.
Cao Sy
Kiem, chairman of DongABank, said banks have seen lending pressure subsiding
this year. DongABank obtained higher credit growth than in previous years,
buoyed by a pickup in credit for agriculture, small- and medium-sized
enterprises and small traders in HCMC and neighboring provinces.
The
National Financial Supervisory Commission said more credit has flowed into
priority sectors this year.
Vo Tri
Thanh, vice president of the Central Institute for Economic Management
(CIEM), said credit growth this year was not too high and still under the
central bank’s control.
This
year, credit grew higher than in the two previous years, showing clearer
signs of an economic recovery, especially in the industrial sector.
Besides,
the State Treasury has seen unsuccessful government bond sales in recent
months due to low yields as investors projected inflation to bounce back
slightly but still within 4-5%.
G-bonds
usually have long tenors while commercial banks are interested in terms of
less than five years. Therefore, banks have diverted capital from G-bonds to
manufacturers, traders and consumers, Thanh said.
Credit
demand usually picks up in the second half but the central bank is able to
put credit growth under control, he added.
However,
the Ministry of Planning and Investment warned that too much capital for the
real estate sector would probably heat up the market. Therefore, the central
bank and relevant agencies should closely oversee lending to secure healthy
credit growth, which is put at 13-15% for this year.
Expressways
may be opened to big bikes
The
Ministry of Transport has said it will launch a pilot scheme permitting
motorcycles with engines of over 175cc to use expressways that have so far
been exclusively used by automobiles.
When the
plan translates into reality, Hanoi-Lao Cai, HCMC-Long Thanh-Dau Giay and
HCMC-Trung Luong expressways would be opened to those motorbikes.
Transport
Minister Dinh La Thang gave the nod to the scheme at a meeting in Hanoi on
Wednesday. However, it made no mention of when heavy duty motorcycles are
allowed on the expressways as the ministry is still working on specific
regulations.
Thang
explained that as local firms can import heavy duty motorcycles for local
sale and more people hold driving licenses for these bikes, qualified riders
should be permitted to use the three expressways.
According
to the Directorate for Roads of Vietnam, some Asian nations like China, Japan
and South Korea permit heady duty bikes on expressways but set lower speed
limits than those for cars. For instance, Japan limits motorcycle speeds at
70-90 kilometers per hour for big bikes.
The ministry
called for riders of such motorcycles to strictly respect regulations for
expressways when they travel on the expressways. After the pilot period, the
ministry would weigh whether to ask the Government to revise relevant
regulations.
Speaking
at a seminar in HCMC on May 6, members of heavy duty motorcycles clubs
suggested the National Traffic Safety Committee open expressways to big
bikes. They said their motorcycles cannot travel at 30-40 kilometers per hour
like smaller bikes but if they ride faster than speed limits on normal roads,
they would be fined.
Imported
CBU auto sales up but lower than in 2009
The
sales volume of imported completely built-up (CBU) autos has grown faster
than that of locally-assembled autos since last year but their share of the
total car sales is still lower than in 2009.
Jesus
Metelo Arias, vice chairman of the Vietnam Automobile Manufacturers’
Association (VAMA) and managing director of Ford Vietnam, said auto sales in
2009 reached a record high of around 180,000 units with imports accounting
for 29%. Meanwhile, he added, the current percentage of imported autos in the
total sales is 25-26%.
However,
the domestic auto market has plunged steadily since 2009, so consumption of
CBU autos has also dropped with their proportion falling to 16-17%.
Arias
said CBU auto sales would depend on Government policies for the industry. He
added many domestic assemblers have shifted to importing cars as locally
assembled versions cannot compete with those manufactured in regional
countries like pick-up trucks made in Thailand.
Ford
Vietnam now imports Ranger pick-up trucks and assembles Transit, Everest and
EcoSport as these models still sell well on the domestic market.
Vietnam’s
auto industry development strategy until 2025 with a vision towards 2035 came
out long ago but specific policies to prop up the market have not been
introduced.
Carmakers
are waiting for such policies to decide whether to continue assembling or
shift to importing cars from regional markets. This will affect the volume of
CBU auto sales in the coming time.
Vietnam
has committed to slashing import duties on autos from ASEAN countries to 0%
in 2018 from the current 50%. Therefore, local auto firms will find it hard
to compete with cars made in Thailand and Indonesia in terms of prices.
According
to VAMA, 157,810 units were delivered to customers last year and domestically
assembled vehicles made up 133,588 units of the total. Nevertheless, sales of
vehicles manufactured in Vietnam picked up 32% while imported autos jumped
83% against the previous year.
Besides,
18,178 autos were sold last month, up 60% year-on-year, including 13,980
domestically assembled units, up 9%, and nearly 4,200 units imported, up 19%.
Source : VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR
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Chủ Nhật, 24 tháng 5, 2015
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