BUSINESS IN BRIEF 27/11 Vietnam attends International Pepper Community’s annual meeting Vietnamese agricultural officials and business people joined over 250 representatives from leading pepper export countries worldwide at the 43rd Annual Session of the International Pepper Community (IPC), which took place in Karnataka state, India from November 22-26. The event was jointly organised by the IPC, India’s Ministry of Commerce and Industry and the Indian Spices Board to discuss prospects and headwinds facing world pepper growers and traders. The participants focused their attention on pepper consumption and stocks, pepper prices and market situation as well as measures to stabilise markets. Specialised talks were also held on pepper cultivating techniques, processing and preservation technology, and regulations on food hygiene and safety. On the occasion, Deputy Minister of Agriculture and Rural Development Tran Thanh Nam, who was accompanied by 14 Vietnamese large pepper businesses, met with officials from Indian Ministry of Commerce and Industry and the ministry’s Spices Board. The two sides shared information on cooperation opportunities and sought ways to boost trade in spices, especially pepper. The Indian side said they are ready to help Vietnam to set up a pepper trading floor. Vietnamese pepper has been shipped to 97 countries and territories. India, together with the US, Singapore and the United Arab Emirates, are the biggest pepper importers of the Southeast Asian country. Vietnam, EEU target further trade ties A Vietnam-Eurasian Economic Union business forum was held in Hanoi on November 25 to help the two sides’ enterprises study the markets and seek investment opportunities. The Eurasian Economic Union (EEU) comprises Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan which are Vietnam’s traditional trading partners. Trade between Vietnam and the EEU posted an annual growth rate of about 5-6 percent, reaching 4.2 billion USD in 2014. However, the figure remains modest as compared to their great potential and demands for further trade ties. Speaking at the event, hosted by the Vietnam Chamber of Commerce and Industry (VCCI), Duong Hoang Minh, deputy head of the European Market Department under the Ministry of Industry and Trade, said businesses from the EEU, especially those from Russia, have strength in manufacturing and export of machinery, industrial equipment and chemicals, energy facility construction and mining. Meanwhile, the Southeast Asian nation boats huge potential in farm produce, garments-textiles and household electronics. As such, Vietnam and the EEU can support and supplement each other in goods imports and exports, he noted. Economists said the signing of a free trade agreement (FTA) by the two sides has created favourable conditions for their businesses to increaseimport-export and investment activities in the coming time. Through Vietnam, Russian firms can integrate into the ASEAN market more easily, they said, suggesting both sides’ businesses study regulations set in the FTA as well as consumption demands of each particular market. Stressing the great potential for cooperation between Vietnam and Russia, a representative from Russia’s Ministry of Economic Cooperation, said thecollaboration is bound to advance in the near future thanks to their Governments’ incentives.- Five key fruits developed in southern region The southern region has focused on growing five key fruit trees on hundreds of thousands of hectares, said an agricultural official. The region has grown dragon fruit trees on 37,000 hectares, mangoes on 22,700 hectares, durian on 10,500 hectares, longan on 25,600 hectares and rambutan on 7,800 hectares, according to Pham Van Du, Deputy Director of the Department of Cultivation under the Ministry of Agriculture and Rural Development. Over the past year fruit exports have increased, which has encouraged domestic fruit production, Du said. In the first 10 months this year, fruit exports earned 1.5 million USD, up 30 percent on the year. The improved rural infrastructure has also facilitated production, transport and consumption, while technology transfers and the application of international standards have helped improve product quality and expand markets. According to Nguyen Van Hoa, Director of the Southern Fruit Research Institute in Vietnam, advanced technology has helped reduce production costs and technical assistance has helped improve productivity. The connections between stakeholders such as authorities, scientists, enterprises and farmers have also boosted production efficiency. Cooperatives, or groups of farmers, have also been established in a bid to enhance production capability and competitiveness, thus raising local farmers’ incomes. Fruit and vegetable exports are likely to achieve the Government's target of 1.65 billion USD this year, according to the Ministry of Industry and Trade. More and more countries have opened their doors to Vietnamese fruits and vegetables, including selective markets like the US, Australia, the EU and Japan. Earnings from fruit and vegetable exports have increased in recent years, from 460 million USD in 2010 to 1.47 billion USD last year, according to the Vietnam Fruit and Vegetable Association (Vinafruit). Businesses pushed to save energy With many companies in Viet Nam remaining energy inefficient, the demand for consultation on energy saving solutions is high. The HCM City Energy Conservation Centre, for instance, has been offering consultation to more than 200 companies a year. Ninety per cent of them achieved satisfactory results, Huynh Kim Tuoc, the director of the centre, revealed at the inaugural ceremony of a programme to encourage energy-intensive companies to adopt energy-saving strategies in HCM City yesterday. At an interaction later with business executives, Le Phu Hung, deputy head of the General Department of Energy, said power consumption in Viet Nam has increased sharply in recent years and is expected to surge further in the coming years. In 2013 energy consumption was the equivalent of roughly 36 million tonnes of oil, and in 2020 this is expected to go up to 77.6 million tonnes, with industry using 50 per cent, he said. Transportation is the second biggest consumer at around 30 per cent, he said. The poor technologies used in Viet Nam cause high energy consumption, he said. Compared with Japan, for instance, its energy efficiency is a mere sixth, and other countries in the region like Thailand, Indonesia and Malaysia are also more energy efficient, he said. The programme does not have a target for the number of companies participating, amount of energy to be saved or amount of emission to be reduced. Nguyen Phi Hung of the HCM City Energy Conservation Centre cited the success of Colusa-Miliket in adopting solutions to save energy, saying from consuming 0.278 tonnes of oil to produce one tonne of product in 2010, the company brought it down to 0.204 tonnes in 2013. Tan Phu Plastic Company saved 43 per cent in 2013 after adopting his centre's solutions, he said. The 2012-16 Clean Production and Energy Efficiency Project by the Ministry of Industry and Trade's General Energy Department is expected to save over 360,000 tonnes oil and reduce emissions by 1.25 million tonnes by its conclusion. Vietjet and Lufthansa Technik AG sign technical service agreement Vietjet and Lufthansa Technik AG, a member of Lufthansa AG, yesterday inked a technical service agreement for Vietjet’s current A320-family aircraft engines. Mr. Nguyen Thanh Hung, Vice Chairman of Vietjet and Mr. Bernhard Krüger – Sprengel, Senior Vice President Engines of Lufthansa Technik AG, signed this landmark agreement in the presence of H.E. Frank-Walter Steinmeier, Germany’s Foreign Minister, and H.E. Truong Tan Sang, President of Vietnam, who is on an official State visit to Germany to celebrate the 40th anniversary of bilateral diplomatic ties between Germany and Vietnam. Accordingly, Lufthansa Technik AG will provide Vietjet with top-of-the-range solutions on technology, maintenance service and technical maintenance as well as consultation on key technical projects, technical training for staff and other consulting services. The agreement will pave the way for both groups to mutually construct a platform to develop facilities and technical expertise up to top-rated domestic and international quality standards. From Vietjet’s side, the Vietnamese airline will support Lufthansa Technik AG to better access the large markets in the Asia-Pacific region – one of the areas with the most potential in the field of aviation. Mr. Bernhard Krüger – Sprengel, Senior Vice President Engines of Lufthansa Technik AG, said: “We are delighted to accompany Vietjet in technical services and engine maintenance, which are expected to lay a solid foundation for the spectacular and long-term development of Vietjet. Lufthansa Techinik AG is committed to providing its world leading technical management services for Vietjet, helping to improve the quality and safety of the flight in serving its passengers. We are also committed to supporting Vietjet in new technology training for safety and security assurance as well as researching opportunities for providing aircraft spare parts locally.” Also witnessing the signing ceremony, Nguyen Thanh Ha, Chairwoman of Vietjet, said: “Vietjet highly appreciates the support from such an experienced company in Germany such as Lufthansa Technik AG. It will help Vietjet meet the needs of the operation and rigorous maintenance of the fleet, ensuring all new flights of Vietjet will operate at the highest levels of safety and maintenance.” The Lufthansa Technik AG, with more than 30 subsidiaries and about 26,000 employees worldwide, is one of the leading providers of services for the aviation industry. Lufthansa Technik AG is licensed internationally as a repair, production and development enterprise. The Group’s portfolio encompasses the entire spectrum of services in the areas of maintenance, repair, overhaul, modification and conversion, engines and components.  Firms study EEU deal opportunities Numerous Vietnamese firms and member states of the Eurasian Economic Union (EEU) gathered at a business forum yesterday in Ha Noi to study opportunities from the free trade agreement (FTA). The business forum, which was co-organised by the Viet Nam Chamber of Commerce and Industry, the Ministry of Industry and Trade and the Eurasian Economic Commission, aimed to create conditions for businesses to exchange information, for seeking co-operation and investment opportunities. Signed in May, the Viet Nam-Eurasian Economic Union Free Trade Agreement became the tenth FTA that Viet Nam had signed, but the first agreement that EEU had signed with a trade partner, offering great opportunities and advantages for hundreds of Vietnamese businesses in expanding exports in this huge market which included Russia, Armenia, Belarus, and Kazakhstan, along with Kyrgyzstan. All member states in the EEU were Viet Nam's traditional trade partners, especially Russia. The bilateral trade between Viet Nam and EEU reached US$4.2 billion in 2014 with an average annual growth rate between 5 per cent and 6 per cent, which was still modest in comparison with the anticipated potential, the forum heard. Duong Hoang Minh, deputy director of the Department of European Market under the Ministry of Industry and Trade, said that there was no conflict between the export products of the two sides, so there would be huge room for expansion when about 90 per cent of tariff lines are cut to zero. He pointed out that businesses from the EEU had advantages in machinery, industrial equipment, chemicals, and energy, in addition to mineral mining, while agricultural, garment and textile products were to Viet Nam's advantage. At the business forum, the two sides expressed the hope that co-operation would receive a boost in future with the support of all governments with regard to in tax and customs procedures. Experts urged businesses to study the FTA, demands and requirements of each member market and consumer tastes carefully, to be able to grasp opportunities. In addition, attention should be paid to enhancing product quality, especially food and seafood products. Vietnam urged to fight counterfeit goods Fighting against counterfeit goods has been a big challenge for Viet Nam, especially since violations of intellectual property rights (IPR) have become more sophisticated and complicated, a government minister said. Do Thang Hai, deputy minister of Industry and Trade, told the Anti-counterfeit Goods Day held in Ha Noi yesterday that market watch forces nationwide should strictly implement legal regulations while improving the capacity to fight against the proliferation of fake goods. Giles Lever, ambassador of the United Kingdom (UK) to Viet Nam, said IPR has been an important issue in promoting economic co-operation between the UK and Viet Nam. This year, the UK took second place in the Global Innovation Index and has witnessed outstanding characteristics in term of innovations in science and research. He said this was the reason why the UK had paid special attention to IPR and was ready to share with Viet Nam its experience in this field. Sharing the ideas, Le The Bao, chairman of Viet Nam Association for Anti-counterfeiting and Trademark Protection, said the event aimed to increase people's awareness about fake goods and intellectual property rights as well as responsibility of businesses in fighting unhealthy competition. Manufacturers should find solutions to fight against counterfeit goods and register for intellectual property protection. In the first 10 months of the year, the market watch agencies conducted checks and resolved more than 16,870 violations while imposing fines worth VND53.2 billion (US$2.36 million). Vinamilk praised for governance The Viet Nam Dairy Products Joint Stock Company (Vinamilk) was regconised as the publicly listed companies with the best corporate governance in Viet Nam. The award was granted during the first ASEAN Corporate Governance Conference and Awards ceremony held recently in Manila, Philippines. At the event, the top 50 publicly listed companies of the Association of Southeast Asian Nations (ASEAN) were recognised for their remarkable efforts in practicing good governance. According to a report by the ASEAN Capital Markets Forum (ACMF), the three companies with best corporate governance in Viet Nam are the dairy producer Vinamilk, the Ho Chi Minh City Securities Corporation, and the PetroVietnam Fertiliser And Chemicals Corporation, whose tickers on the HCM Stock Exchange (HOSE) are VNM, HCM and DPM, respectively. The ACMF's report is a compilation of corporate governance assessments of publicly listed companies in six ASEAN countries using a scorecard system, called ASEAN Corporate Governance Scorecard (ACGS), based on international best practices. The assessments were made based on publicly available information such as annual reports, corporate websites, notices and circulars. This year Viet Nam had 55 public companies undergoing the assessment, of which 50 are listed on the HOSE and the rest on the Ha Noi Stock Exchange. The Asian Development Bank and the ASEAN Capital Markets Forum created ACGS project in 2012 in the hope of raising corporate governance standards of publicly listed companies in ASEAN countries and increase their visibility to investors. In Viet Nam, Vinamilk is the only brand in the dairy sector that was honoured as the National Brand by the Government four times in a row. It also tops the list of 50 most valuable brands listed on Vietnamese stock markets, which was released by UK-based Brand Finance at the recent Viet Nam Brand Matters Forum.  CFOs get a glimpse into the future In today's complex world, chief financial officers need to consider risk holistically, support enterprise strategy through smart business partnering, and be open to new technologies, a British financial expert said. Joseph Alfred of the Association of Chartered Certified Accountants UK (ACCA) Singapore, speaking at the 7th Vietnam CFO Forum in HCM City on Tuesday about the role of CFOs in moving towards sustainable enterprise development with Viet Nam and the region poised on the threshold of greater integration, said finance would also be people- and data- centric. A CFO should be an integrated thinker with a focus on value drivers, he said. In a 2014 survey of more than 1,600 members worldwide of the ACCA and Association of Accountants and Functional Professionals in Business IMA, 79 per cent agreed that finance in the future would be focused on broader business risks rather than just finance risks since forex risks do not exist in a vacuum but within the universe of business risks, he said. CFOs would hence need to understand this universe and analyse correlations between forex risks and other operational risks, he said. He cited Barry Greene, managing director for finance and operations at public-private health partnership Gavi, the Vaccine Alliance (Switzerland), as saying a CFO needs to be very focused on how the financial organisation is aligned with emerging business priorities. CFOs can support business strategy by delivering richer information insights across the organisation, communicating forex risks to CEOs, guiding sales and purchase teams to be smart about transaction currencies in contracts and setting a smart budget rate for forex transactions as late as possible, he said. Smarter CFOs have the responsibility to ensure that social networks and mobile, cloud, and analytics technologies become strategic tools in driving enterprise change and new business models, and improve the contribution of the finance organisation to support enterprise strategy and compliance with regulatory obligations. Prioritising investment in technology would provide richer information insights and improve decision making, and analytics would help uncover idle balance sheet accounts that can be tied up to eliminate forex exposures, he said. Future finance functions would also focus more on integrated reporting than delivering pure financial reporting as the market value of a business is increasingly reflected by the intangible assets that it holds such as data, brand, talent, and its capacity to innovate, he said. Integrated talent management practices are the next stage in the evolution of talent development and are essential for CFOs who aspire to run good finance functions, he said. He pointed out the most important business knowledge needed by finance – business value drivers, broader industry trends, risk landscape, technology, and digitisation. Vietnam CFO Forum, titled "Financial Management Faces Current Currency Context" this year, was hosted by Viet Nam Chief Financial Officers (VCFO) in co-operation with Japan Association for CFOs (JACFO) and (ACCA). It attracted more than 300 chief financial officers, senior financial analysts from the International Association of Financial Executives Institutes (IAFEI), VCFO, JACFO, ACCA, experts from domestic and international financial institutions, and chairpersons and CEOs of some of Viet Nam's largest companies. Mirae Asset now fully HK owned after takeover Hong Kong-based Mirae Asset Wealth Management Limited has bought out the 51 per cent stake held in Mirae Asset Securities Wealth Management company (MiraeAsset) in Viet Nam by two local partners, making it a wholly foreign invested company. Early this week, the State Securities Commission approved the sale of MiraeAsset shares by the two companies. P/E Investment and Construction JSC had held 13.8 million shares or 46 per cent, and Minh An Investment Corporation, 1.5 million shares. The value of the deal has not been disclosed. Securities brokerages with 100 per cent foreign ownership in Viet Nam include Maybank Kim Eng (fully Malaysian-owned) and Korea Investment Securities Viet Nam (92.3 per cent Korean-owned). The Mirae Asset Wealth Management Limited belongs to the Mirae Asset Global Investments Group, an international asset management company and one of Asia's largest independent financial services groups. Founded in 1997 in the wake of the Asian currency crisis, it is credited with creating the asset management industry in Korea. The branch in Viet Nam was founded in 2007. The Hong Kong-headquartered company now has a presence in Australia, Brazil, Taiwan, India, the UK, Canada, the US, mainland China, and Viet Nam in addition to Korea. At the end of Q3 the unlisted company had assets of VND305.9 billion (US$13.5 million) and Q3 revenues of 8.61 billion ($381,987). Businesses pushed to save energy With many companies in Viet Nam remaining energy inefficient, the demand for consultation on energy saving solutions is high. The HCM City Energy Conservation Centre, for instance, has been offering consultation to more than 200 companies a year. Ninety per cent of them achieved satisfactory results, Huynh Kim Tuoc, the director of the centre, revealed at the inaugural ceremony of a programme to encourage energy-intensive companies to adopt energy-saving strategies in HCM City yesterday. At an interaction later with business executives, Le Phu Hung, deputy head of the General Department of Energy, said power consumption in Viet Nam has increased sharply in recent years and is expected to surge further in the coming years. In 2013 energy consumption was the equivalent of roughly 36 million tonnes of oil, and in 2020 this is expected to go up to 77.6 million tonnes, with industry using 50 per cent, he said. Transportation is the second biggest consumer at around 30 per cent, he said. The poor technologies used in Viet Nam cause high energy consumption, he said. Compared with Japan, for instance, its energy efficiency is a mere sixth, and other countries in the region like Thailand, Indonesia and Malaysia are also more energy efficient, he said. The programme does not have a target for the number of companies participating, amount of energy to be saved or amount of emission to be reduced. Nguyen Phi Hung of the HCM City Energy Conservation Centre cited the success of Colusa-Miliket in adopting solutions to save energy, saying from consuming 0.278 tonnes of oil to produce one tonne of product in 2010, the company brought it down to 0.204 tonnes in 2013. Tan Phu Plastic Company saved 43 per cent in 2013 after adopting his centre's solutions, he said. The 2012-16 Clean Production and Energy Efficiency Project by the Ministry of Industry and Trade's General Energy Department is expected to save over 360,000 tonnes oil and reduce emissions by 1.25 million tonnes by its conclusion. US Group to manage Radisson Blu Cam Ranh Bay EurowindowNhaTrang Tourism Investment Joint Stock Company and US- based Carlson Rezidor Hotel Group – one of the world’s largest hotel groups on November 25 signed a contract to manage Radisson Blu Cam Ranh hotel project. Radisson Blu Cam Ranh will have 250 rooms, 38 villas and other five-star standard facilities like conferences, spa and entertainment services. Eurowindow NhaTrang Tourism Investment Joint Stock Company is a major investor of the eco-tourism area and luxury resort EurowindowNhaTrang projectin the central province of Khanh Hoa with a total investment of VND1,500 billion aiming to develop the North Cam Ranh peninsula tourist site into a national tourism site by 2020. Under the signed contract, Carlson Rezidor Hotel Group will manage 11.4 hectares of the Radisson Blu Cam Ranh Bay. Eurowindow NhaTrang is also expected to sign another contract next month, allowing a European company to manage remaining 22.34 hectares of the project with more than 100 villas and 300 hotel rooms. Thailand eases regulations for Vietnam workers Thailand has decided to loosen work permit regulations for migrant workers, including those from Vietnam under a regulation adopted by Thai cabinet on November 24. Accordingly, Vietnam workers who last entered Thailand before August 10, 2015 (Previously February 10, 2015) may be granted one-year temporary work permits if their residence registration expired and they have labour contracts with Thai employers covering four fields- housework, restaurant, construction and seafood processing. Particularly, those involved in the construction and seafood processing industries can apply for work permit extension. Registration procedures can be made at Thailand’s municipal labour departments within 30 days and all regulations, procedures, fees and registration time will be announced by the Thailand Embassy at the earliest time. China steel dominates home market Vietnam imported 7.7 million tonnes of steel worth US$3.49 billion from China in the 10 months leading up to November, accounting for 61% of the country’s total steel imports, according to the General Department of Vietnam Customs. Steel product imports from China hit US$1.13 billion, up nearly 40% year on year, thus elevating the ten-month imports to more than US$4.6 billion. Late October, the EU Ambassador to Vietnam sent a document from the European Anti-Fraud Office (OLAF) to the Ministry of Industry and Trade in which it suspected Chinese businesses of bringing steel products with huge volumes into Vietnam to avoid anti-dumping duties imposed by the EU. The OLAF detected that many steel products bearing Vietnam labelled brands originated from China. US - major suitcase, bag import partner of Vietnam The US is presently considered a big importer of Vietnam suitcases and bags, accounting for more than US$1 billion out of total US$2.4 billion in export value, far exceeding other key markets-the EU and Japan. In the first ten months leading up to November, suitcase and bag exports expanded 14.3% to more than US$2.4 billion, said Leather, Footwear and Handbag Association (LEFASO) Vice Chairman Diep Thanh Kiet Foreign direct investment (FDI) businesses from the Republic of Korea (RoK)- a key factor in bolstering exports in this filed- constituted roughly 80% of total export earnings. Meanwhile domestic businesses (except only 1- 2 firms meet criteria for global production chains) principally manufacture and outsource products. Int'l cashew processing exhibition opens in Long An The third International Cashew Processing Equipment Exhibition opened on November 22 in the southern province of Long An, according to the Vietnam Cashew Association (Vinacas). The event saw participation from 100 cashew manufacturers from 40 countries worldwide. According to Chairman of Vinacas Nguyen Duc Thanh, most members of the association have used processing machines to manufacture quality products, meeting requirements of international customers such as the EU, the US and Japan. Domestically made machines help cut processing costs and time from 16 days to 10 days, with the rate of broken nuts at only 10%, he added. Vietnam has several cashew processing machine brands, including Khuong May Viet, Hong Hai, Phuc Thang, Cao Phat, My An An and Mekong. The machines have been exported to many countries such as India, China, Indonesia and Africa. In the first 10 months of 2015, Vietnam exported 272,000 tonnes of cashew nuts for a turnover of US$1.9 billion, up 6% in volume and over 18% in value compared with the same period last year. The cashew sector is expected to bring home US$2.5 billion in 2015, of which US$2.3 billion is from cashew nuts. Vietnam continued accounting for over 50% of the globe’s cashew nut trade value of about US$5 billion, and maintained its title as the world’s leading cashew nut exporter for the 10th consecutive year. Vietnam's FPT eyes US to increase global presence: report Vietnamese top IT company FPT has identified the US as an important market to expand its overseas presence, according to a Nikkei Asian Review report. FPT hopes to have some mergers and acquisitions worth US$50-100 million in the US, where its revenue growth is about 45% this year, chairman Truong Gia Binh was quoted as saying on November 19. The projected growth rate is higher than that of Japan, currently FPT's biggest overseas market which accounts for about 50% of its annual revenue. M&As will be the key way for FPT to accelerate its growth, he said, adding that it plans to invest about US$50 million in one or two M&As to capture new markets and build up expertise every year. Besides big markets, FPT also targets developing countries such as Cambodia, Laos and Myanmar, mainly through World Bank projects, according to the chairman. The Vietnamese government plans to sell its 6 percent stake in FPT, along with stakes in another nine companies including dairy giant Vinamilk and insurer Bao Minh. The 50.17% state-owned stake in FPT Telecom, a subsidiary of FPT, is also expected to be sold. Foreign investors now own nearly 49% in FPT, which posted a pre-tax profit of VND1.35 trillion (US$59.25 million) last year, up 10%. Taiwan tourism promoted in Hanoi The Taipei Economic and Cultural Office in Vietnam and the Taiwan Tourism Bureau (TTB) launched a tourism promotion program in Hanoi on November 23. Representatives from 26 Taiwan travel agents, hotels, airlines and relevant associations joined the event. They gave latest information about Taiwan’s tourist attractions and incentive travel in the hope to attract more Vietnamese visitors. The number of Vietnamese tourists to Taiwan has increased sharply since the two countries signed a memorandum of understanding on tourism in 2012. Both sides expect to welcome 500,000 tourists this year As from November 1, Taiwan has been piloting a preferential visa policy for high-end tour groups from Vietnam as well as those from the Philippines, Thailand, Indonesia and India with the aim of increasing tourist arrivals. Meanwhile, the fourth Vietnam-Taiwan Tourism Cooperation Conference will take place in HCM City on November 26 to update participants on regional integration and share information about the ASIA Cruise Services Network (ACSN) alliance. Art performances and the tourism programs launched in Hanoi and HCM City demonstrates Taiwan’s due attention to Vietnam market. FDI farming, mining projects reach 213 million USD Vietnamese companies invested over 213 million USD in mining and farming projects abroad in the first 10 months of 2015, according to figures released by the Foreign Investment Agency under the Ministry of Planning and Investment. The overseas mining and farming projects accounted for nearly half of total registered capital of the Vietnamese investors' new overseas FDI projects licensed by the Vietnamese authority over the same period. The department licensed 102 new foreign direct investment (FDI) projects capitalised at 441.9 million USD, plus capital expansion of 192.8 million USD for 53 operational FDI projects, in the first 10 months of the year. In all, agencies licensed a total capital of 625.4 million USD invested by Vietnamese firms outside Vietnam in the first 10 months of 2015. Major investments were channeled into traditional markets such as Cambodia (with 194 million USD for 23 projects); Laos (with total investments of 126 million USD for 18 projects); and the US (with 102 million USD for 22 projects). In addition, Vietnamese investors were also licensed for FDI projects in Russia, Singapore and Germany. The mining sector attracted the biggest investments from local firms, up to 107 million USD, accounting for 16.8 percent of total investments, followed by the farming, fishery and forestry sector with investment of 106 million USD. In the past few years, investments have also been poured into sectors such as information technology, communications, power generation, real estate, financial services, insurance and banking. This indicates the diversity of FDI sources from Vietnamese investors, according to the Foreign Investment Agency. HBC wins two contracts worth $125.4 million The Hoa Binh Construction and Real Estate Corporation (HBC) and Keppel Land Limited signed a VND1.9 trillion ($84.493 million) contract on November 23 for the construction of the second phase of the Saigon Centre building in District 1, Ho Chi Minh City, with the former to be the general contractor. HBC’s responsibilities include full construction and electricity connections for the 37 storey building. The building has the largest basement in Vietnam, with six levels. Construction is proceeding on schedule and is expected to be completed by the end of 2016. After this second phase is finished the Saigon Centre will have 40,000 sq m of office space of Grade A standard and 50,000 sq m of retail space from the first to seventh floors as well as 200 serviced apartments. HBC announced that about 90 per cent of the retail space has already been leased. Takashimaya, one of world’s largest department store chains, is the largest lessee, renting 15,000 sq m. The Chairman of Keppel Land in Vietnam said that with the number of retail outlets, entertainment options, and global brands appearing for the first time in Vietnam, the Saigon Centre will be a destination for shopping and suitable with lifestyles in Ho Chi Minh City. HBC was also selected by Keppel Land and the Tien Phuoc Real Estate JSC to be the general contractor for the Estella Heights luxury apartment project in District 2, Ho Chi Minh City, which has VND920 billion ($40.9 million) in investment. It will be in charge of construction, electricity connections, and landscaping, and expects to complete the project by June 2017. Building of large fishing centers cost US$649.32 million Construction of six large fishing centers in Vietnam is estimated to cost VND14.6 trillion (US$649.32 million), reported the Directorate of Fisheries in Hanoi on November 23. An artist’s impression of Khanh Hoa fishing center The report was made at the meeting chaired by the Ministry of Agriculture and Rural Development to implement the Prime Minister’s instruction on planning and building large fishing centers in Vietnam. According to the directorate, of the total capital, VND5.2 trillion will come from the state budget, VND1.6 trillion will be raised with Public Private Partnership mode and VND7.7 billion from businesses. Among five localities selected to pilot building of the centers in association with Vietnam’s main fishing grounds, the Government has offered the south central province of Khanh Hoa a special mechanism via transferring entire investment capital to the province. The fishing center project in the central city of Da Nang is waiting for approval. Leaders of the chosen localities said at the conference that so far only Khanh Hoa has determined the fishing center’s location at Da Bac fishing port. Other five have yet to find out positions. They have made commitments to speed up necessary works in order to start building fishing centers in 2017 and complete those in 2019-2020, said Deputy Minister of Agriculture and Rural Development Vu Van Tam. Satra, SBS Holdings join hands in logistics Saigon Trading Corporation (Satra) and Japanese SBS Holdings yesterday signed a memorandum of understanding on cooperation in logistics field to improve the corporation’s goods receiving and delivery ability. The two sides will work on a pre-feasibility study of a joint venture project to create a chain covering input materials, processing, preservation, transportation and delivery. Satra is the owner of Vietnam’s top prestigious brands in food processing field such as Vissan, Cau Tre, Agrex Saigon, Cofidex, APT and Vietnam Brewery Limited. The corporation is also runner of the country’s largest wholesale market Binh Dien providing seafood and farm produce, two supermarkets, one trade center and 66 convenient stores Satrafood and many other stores. SBS Holdings is a prestigious logistics group in Japan with annual revenue of US$1.3 billion. Its main businesses comprise seaway and airway transportation. The cooperation with Satra is part of the group’s strategy to wait in front for the about to be signed Trans-Pacific Partnership. Mekong Delta needs huge capital for growth The Mekong Delta’s 13 provinces are calling for investment in 177 projects worth a combined VND150 trillion (US$6.7 billion) to develop infrastructure and improve residents’ lives, heard a conference in Can Tho City last Friday. The projects include investment in mass cultivation of rice, farm produce processing, seed production, infrastructure, industrial parks, power stations, entertainment and recreation facilities, and new urban areas. Among the projects are an amusement park in An Giang Province which needs a total of over VND28 trillion and a customs-free zone in Nam Can economic zone of Ca Mau Province with a total investment of VND8 trillion. Vo Hung Dung, director of the Vietnam Chamber of Commerce and Industry (VCCI) of Can Tho City, said the fact that there are many projects in need of investment capital is an indication of huge potential in the region. Vietnam imports from Africa surge Africa is a potential farm produce market for countries like Vietnam but the country is having a trade deficit with this continent, heard a conference on south-south trade and cooperation between Africa and the Francophone Mekong countries. According to data of the West African Economic and Monetary Union (UEMOA), Vietnam’s imports from the African market surged strongly in the 2007-2014 period. Hoang Duc Nhuan, deputy head of the West Africa and Southwest Asia Markets Department under the Ministry of Industry and Trade, told the conference in HCMC last week that Vietnam had a trade deficit with UEMOA in 2011-2014. UEMOA groups Ivory Coast, Benin, Burkina Faso, Guinea Bissau, Mali, Niger, Senegal and Togo. In 2013, Vietnam exported US$382.8 million worth of merchandise from UEMOA but imported US$552.4 million worth from this market. In 2014, Vietnam’s exports to the region fell to US$293.3 million while its imports climbed to US$560.8 million. Vietnam mainly sells rice, which accounts for 50-70% of the country’s total exports to the region. Rice exports amounted to US$51.7 million in 2007 and jumped to US$135.5 million in 2014. Other exporting items are clothing, components, spare parts, motorbikes and tobacco material.    Meanwhile, Vietnam bought cashew and cotton, which make up 89% of its total imports from UEMOA, as well as scrap steel and wood. Vietnam’s exports to the Central African Economic and Monetary Community (CEMAC), which consists of Cameroon, Central African Republic, Congo, Gabon, Guinea Ecuatorial and the Republic of Chad, have dropped sharply while its imports have shot up over the years. In 2007, Vietnam’s exports to CEMAC reached US$37.6 million and topped US$153.65 million in 2013. In the following year, the figure declined to US$64.72 million while its import bill increased. The nation mainly exports rice (50%) and imports wood products. In doing business with West and Central Africa comprising 14 countries, Vietnam’s exports have plunged while its imports have gone up.     Nhuan of the Ministry of Industry and Trade said Vietnam’s rice exports to CEMAC declined from US$85 million in 2013 to US$25.1 million in 2014 due to tough competition with Thailand. Thai Kieu Huong, vice president of the Vietnam-Africa-Middle East Business Forum, said Africa is a potential growth market but Vietnamese firms have little knowledge about it, so doing business there is risky.    The conference took place on November 19 and 20 in HCMC with 30 businesses from West and Central Africa and 100 Vietnamese enterprises attending. SMEs care little about technical barriers to trade Many local enterprises, especially small and medium ones, are paying little or no attention to technical barriers to trade (TBT) though these barriers will directly impact their operations in the coming time. Nguyen Van Ha, head of the HCMC Standard, Measurement and Quality Control Authority, said at a conference last Friday that many firms in the city know little about TBT, which consists of technical regulations, standards and conformity assessment procedures that are set by World Trade Organization member countries but that are non-discriminatory and do not create unnecessary obstacles to trade. He told the conference which reviewed the implementation of the TBT agreement in HCMC in 2011-2015 and discusses ways for its execution in 2016-2020 that almost all SMEs ignore the matter of TBT, so they sometimes face TBT-related problems with their exports. Ha said it might be because SMEs lack finances and human resources to learn about technical barriers to trade in importing nations. There are offices in provinces and cities where exporters can get information about TBT but he said some offices do not have information about TBT for certain groups of goods. A number of importers have shipped goods back to Vietnamese firms as items did not meet technical or food safety requirements. Lawyer Pham Ngoc Hung, vice chairman of the HCMC Union of Business Associations, said just a number of major enterprises have paid due attention to TBT while SMEs lack knowledge of this. Relevant authorities should also be responsible for this situation as they have not actively helped SMEs get updates about TBT. However, many companies and industry associations do not know about the presence of TBT offices in provinces, said Le Bich Ngoc, deputy director of the TBT representative office in Vietnam’s southern region. The TBT offices have got few queries from businesses though they are directly affected by TBT. Ngoc said perhaps most of the companies export raw materials or outsource for foreign companies, so they feel they are affected by TBT. According to authorities and enterprises, there will be more TBT in the years to come as the ASEAN Economic Community will be launched by the year-end through an agreement signed in Kuala Lumpur on November 22 by leaders of 10 Southeast Asian nations, and Vietnam has got involved in a number of free trade agreements, particularly the Trans-Pacific Partnership. Hau Giang to host 2016 economic forum The Mekong province of Hau Giang will host the Mekong Delta Economic Cooperation (MDEC) Forum 2016 which will feature discussion about the Delta's international integration and sustainable development. The forum will include the Mekong Delta Week to be held from April 22 to 26 in Ha Noi. The week will include a show of cai luong (reformed theatre) at My Dinh Stadium and a conference on the cooperation between the Mekong Delta and Ha Noi and other cities and provinces in the North. Nguyen Phong Quang, deputy head of the steering board of the Southwest Region and head of the Hau Giang MDEC Forum 2016, spoke at a press meeting in Can Tho City yesterday to introduce the forum. Quang said the conference would include a seminar on agricultural production in the Delta in response to climate change and rising saltwater as well as a trade-fair to promote products and services from the region. In the past several years, bank credit had significantly contributed to socio-economic development of the Delta, he said. Credit growth in the region had been higher than in other regions across the country. Credit policies issued by the State Bank have helped direct credit influxes into a number of economic sectors, aiming to create a "breakthrough" in restructuring the region's economy and its agriculture, as well as to build a model of new rural areas in the Mekong Delta, according to the official. In addition, banks have also taken an active part in social welfare programmes in the region. Quang said the financial support of VND480 billion (US$21.4 million) provided by donors to the Mekong Delta during the MDEC Soc Trang 2014 included VND393 billion ($17.5 million) contributed by commercial banks, plus VND50 billion the banks provided to the construction of Tran De Hospital in Soc Trang Province. HCM City supports loan interest with investment stimulus Domestic investors will receive no-interest loans of VND100 billion (US$4.5 million) and less under a HCM City People's Committee's investment stimulus programme. Eligible investment projects must be in sectors of high technology, industry, industrial support, trade, agricultural production, healthcare, education and training, culture and sports, infrastructure and environment. The investment projects will be supported 50-100 per cent of loan interest for a period of up to seven years. Investment projects that borrow loans worth more than VND100 billion or have a borrowing period of more than seven years will be decided case by case by the municipal People's Committee. The programme aims to encourage companies and co-operatives to upgrade their production facilities, replace import products and produce value-added products. It also encourages the development of private investment in industrial support sectors, healthcare, education and training, culture and sports. The People's Committee has carried out several measures to enhance production, including a plan to build three- to eight-floor factory buildings in industrial parks and export processing zones in the 2015-18 period. A number of buildings have been built in Dong Nam and Hiep Phuoc industrial parks, Linh Trung and Tan Thuan export processing zones. The buildings, which have a floor area of 10,000-40,000 sq.m each, house factories covering 100 – 3,000 sq.m each. The buildings help the city use land with optimal effectiveness, and meet the diverse demand of investors, according to the People's Committee. Companies that invest in such buildings have received preferential loans for the cost of new buildings and other support facilities. Over the past three years, the city's bank-enterprise linkage programme has provided soft loans worth more than VND120 trillion ($5.4 billion) to thousands of enterprises. With the implementation of several measures, the city's industrial production scale has expanded in recent years, according to the city's Department of Industry and Trade. The city's industry has also increased the proportion of processing and manufacturing and reduced the proportion of mining, said the department. Huynh Van Minh, chairman of the HCM City Enterprise Association, was quoted as saying in Sai Gon Giai Phong (Liberated Sai Gon) newspaper that the People's Committee had issued policies that provide financial support for enterprises in the initial stage of reform. Thanks to the support, enterprises had favourable conditions for research, and produced new products or improved technologies, he said. But in the long term, he said the city should strengthen measures to support goods consumption and develop distribution channels. The city should set up a market that provides information for enterprises, helping them make decisions about production, he added. The city's investment stimulus scheme has been implemented since 2000, providing soft loans for about 880 projects which have investment capital VND35 -80 billion each, according to the city's Department of Planning and Investment. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR