BUSINESS IN BRIEF 16/12 NCB appoints new General Director Following approval from the State Bank of Vietnam, Mr. Dao Trong Khanh has been officially appointed to the position of General Director of National Citizen Bank (NCB). Mr. Khanh has a Masters of Financial Economics from the National University of Singapore and has worked at banks such as Citigroup, Caylon Bank, and Mizuho Bank. He has also held the positions of General Director and member of the Board of Directors at TP Bank, and was Vice Chairman of the Board at Maritime Bank. Ms. Tran Hai Anh will step down as General Director but continue to hold the position of Vice Chairman of the Board. According to Ms. Anh, NCB has quickly built up a solid technology platform and operates under international standards and practices. “We believe NCB will develop quickly and firmly under the management of Mr. Khanh,” she added. As at November 2015 deposits and customer loans of NCB had increased 76.48 per cent and 54.51 per cent, respectively, against the end of 2014, with bad debts controlled at 2.08 per cent. With a network of over 90 transaction points nationwide and a customer network built over 20 years, NCB will focus on providing strategic retail products specifically for individuals and businesses and packages of flexible financial solutions for small and medium-sized enterprises based on a modern technological platform. Japan puts stress on agricultural deal with Vietnam   A rice field in Ca Mau.  Japan pays heed to the implementation of an agricultural cooperation pact with Vietnam, said agro-forestry-fisheries minister Hiroshi Moriyama. The Minister made the statement during a meeting with Vietnamese Ambassador to Japan Nguyen Quoc Cuong on December 14. Minister Moriyama lauded the high-level dialogue mechanism on agriculture between Vietnam and Japan, and the signing of a joint vision on middle- and long-term farming cooperation during the official Japan visit made by Party General Secretary Nguyen Phu Trong in September. Under the pact, from 2015-2019, a series of action plans will be piloted in Vietnamese localities to improve their agricultural value chain. The pact also mentions of the context of climate change and the training of high-quality human resources for Vietnam. Ambassador Cuong told his host about both sides’ implementation of their agreement on opening market for the two countries’ agricultural products. Vietnam’s Cat Chu mangoes are sold at some Japan’s supermarkets, while Japanese apples will be available in Vietnam starting December 19, he said. Both host and guest further discussed necessary measures to boost market access for Vietnamese and Japanese agricultural goods moving forwards. Korean firm to invest in Quang Nam IP The Republic of Korea’s firm C&N VINA Tam Anh will start construction of its first industrial park (IP) in Tam An commune in the central province later this month, officials said. Director of Chu Lai Open Economic Zone Authority (EZA) Do Xuan Dien confirmed to Vietnam News that the IP has been designed to encourage investment flows from the Republic of Korea (RoK). He said the RoK firm will begin the first stage of construction on 200ha, with a total investment of 25 million USD for infrastructure development, and this phase will be completed in 2017. "We will create favourable conditions for investors to boost the infrastructure development process of the IP, which will host investors from 2017," Dien said. He said the EZA had started granting investment licenses to investors in April. The RoK firm developed the 192ha Minh Hung– RoK IP in southern Binh Phuoc province and the first stage of the Phong Dien IP on 126ha of land in Thua Thien-Hue province. The company has been seeking further investment in infrastructure in IPs in the Dong Nai and Long provinces. The 32,400ha Chu Lai Open EZA has 109 investment projects, of which 29 are FDI projects, with a combined registered capital of more than 1.52 billion USD. Sixty-six projects, worth more than 837 million USD, are in operation, creating 12,000 jobs for the local people. The zone has drawn 252.47 million USD in FDI projects. Chu Lai EZA, one of five coastal economic zones in the country, in cooperation with the Korean Textile Association, has attracted investments from the textile and tourism industries in RoK. The zone also plans to open sea routes from Ky Ha to Busan, Hong Kong and Singapore in 2016-17 and to upgrade Chu Lai Airport to allow more international flights. Non-cash payment method gets popular Non-cash payment has gradually become a trend in Vietnam as cash-used expense saw a remarkable reduction, according to the State Bank of Vietnam’s Payment Department. Cash-used payment has reduced from 14.02 percent in 2010 to 12 percent at present, it reported. A number of payment methods and services based on technology have been introduced to payers and the economy. According to the department, 96.2 million cards have been issued nationwide, up 210 percent from early 2011. There are 60 organisations providing Internet Banking payment services and 30 organisations providing Mobile Banking payment services. The payment infrastructure has been improved, evidenced by the rapid increase of ATMs and Point-of-Sale (POS), by 47 percent and 300 percent, respectively. Commercial banks are interested in developing retail banking services and individual customers with the number of individual accounts reaching 57.8 million. Some commercial banks implemented services for paying electricity and water bills, telephone, telecom, insurance, and cable television fees, among others. TPP to help Vietnam balance trade relations: economists The participation in the Trans-Pacific Partnership (TPP) agreement will provide a chance for Vietnam to balance its trade relations and avoid over-dependence on certain markets, economists said at a recent seminar in Ho Chi Minh City. Deputy Minister of Agriculture and Rural Development Tran Thanh Nam said the TPP will open up an immense export market for Vietnam with a number of its staple agricultural exports benefiting from low taxes. Foreign investment accompanied by advanced technologies and skilled labour will fan production expansion and agricultural restructuring, he added. Under the FTAs, stronger commitments to investment climate improvement and intellectual property protection will surely draw more foreign investors, particularly big groups, to Vietnam, economists added. However, the TPP participation will also pose major challenges to the country’s agriculture when imported products will create strong competitive pressure on domestic goods, Deputy Minister Nam predicted. He forecast more non-tariff barriers to be erected when tariff barriers are removed. As the TPP includes stringent regulations on copyright, labour, origin and the environment, industries with low competitiveness will suffer from losses at different levels. While a majority of businesses shared the view that new FTAs will fuel growth, agriculture companies are concerned that it will be uneasy to make use of opportunities. It will need modern facilities, strict process and skilled labourers to ensure agricultural products’ quality throughout the production and distribution chains. Tran Cong Thang, Deputy Director of the Institute for Policy and Strategy for Agriculture and Rural Development, urged the expeditious dissemination of FTAs’ content and information about their possible impacts on managerial agencies, enterprises, cooperatives and farmers. Vietnam must also build standard systems that meet the requirements of TPP members while preventing imported goods of inferior quality. The country should enhance the trading of its strong farm products and join global value chains, he said, suggesting it design policies to buffer negative influences on vulnerable commodities. At the function, other mid- and long-term measures were also proposed such as accelerating agricultural restructuring, reducing dependence on imported materials, fine-tuning the policy environment, and improving the capacity of applying sanitary and phytosanitary measures. FPT, Fujitsu launch ‘smart' agriculture FPT and Fujitsu have announced the official completion of their FPT-Fujitsu Akisai Farm and Vegetable Factory project, which applies cloud computing technology to develop a smart agricultural model in Vietnam. This is the initial step within a framework of co-operative projects in smart agriculture signed by the two corporations at the end of 2014. The project is also the first time an information technology solution in agriculture from Japan has been applied in Vietnam. With an area of over 400 sq.m in Gia Lam district on the outskirts of Hanoi, the project will introduce new business models from Fujitsu and the application of its modern technology, knowledge, and experience in Vietnam's agricultural sector. There are two models involved, a greenhouse and a vegetable area, conducting trials on introducing high-value vegetables. Information and images about the environment and the growing area are monitored and managed not only in Vietnam but also in Japan, through online information technology systems. A representative from FPT told VET that the group and Fujitsu will use the project as a location to promote smart agriculture co-creation activities, involving the Vietnamese government and companies from a variety of industries, and to contribute to the further development of Vietnam's agriculture sector. Vietnamese cashews marketed to Hong Kong’s biggest fair Vietnamese cashew nuts are promoted at the 50th Hong Kong Brands and Products Expo at Victoria Park, Hong Kong (China) from December 12 to January 4. The expo, featuring about 500 outdoor booths, is the biggest of its kind and the most expected event in the island. In his remarks at the expo’s opening ceremony on December 12, Hong Kong’s Chief Executive Leung Chun-ying said the event has enjoyed special attention from local business society, manufacturers and consumers over the past 50 years. It serves as a bridge between the producers and the consumers, he added. Vietnamese cashew nuts are brought to the fair by Hong Kong-based Viet Kwong Business Development Company. According to Nguyen Ngoc Ha, Director of Viet Kwong Business Development Company, Vietnamese cashew nuts are favoured by many Hongkongers who appreciate the nuts as a source of food for health. Viet Kwong sold more than 200 tonnes of cashew nuts annually, she said. The 50th Hong Kong Brands and Products Expo is expected to attract approximately 3.5 million visitors this year. Last year, it greeted about 2.7 million people. ASEAN+3 young entrepreneurs honoured Thirteen young entrepreneurs from 10 ASEAN member countries and three dialogue partners were presented the ASEAN+3 award in recognition of their contribution to regional sustainable development at a ceremony on December 13 in Ho Chi Minh City. The award aims to encourage young businesspeople to focus more on community-driven and sustainable development in their business operation, said Pham Phuong Chi, Vice President of the Vietnam Youth Federation. They are also expected to enhance the mutual understanding among the young business circles in the ASEAN bloc and the ASEAN+3, thus fostering their cooperation and experience sharing for the sustainable development of each nation, the region and the world. The ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. The three dialogue partner countries are Republic of Korea, Japan and China. To receive the award, candidates should be one of the founders of young businesses or start-ups. Priority is given to those operating in job creation, education, health care or social services. Other criteria also include environmentally-friendly products, creativity and advanced technology application and local potential relevancy. The awards event was jointly organised for the first time as part of the ASEAN+3 Young Entrepreneur Forum by the National Committee on Youth of Vietnam, the Ho Chi Minh Communist Youth Union and the Vietnam Youth Federation. It saw the participation of 65 young businessmen from 10 ASEAN member nations and three dialogue partners. Central bank to cut bank reserve requirement in January The State Bank of Vietnam (SBV) will reduce the reserve requirement ratio for banks that take part in the restructuring of the banking system. Under Circular 23/2015/TT-NHNN, which will take effect on January 28 next year, the SBV Governor will consider reducing the ratio even to zero percent for ailing banks that are under the central bank's special supervision. As for banks, which are under restructuring or are selected by the central bank to take part in the restructuring of other ailing banks, the Governor will decide on decreasing the ratios depending on each case. Currently, the compulsory reserve ratio applicable to demand and below 12-month term deposits is three percent of the total deposits, while the rate for 12-month-plus term deposits is one percent. The ratios for foreign currency deposits are eight and six percent, respectively. The above rates have remained unchanged since 2012. Under the circular, the central bank also said it would impose fines on banks that fail to meet the reserve requirement ratio. Industry insiders said the move was aimed at encouraging banks to take part in the restructuring as the reduction of the reserve requirement ratio would help them have cheaper capital sources. According to the central bank, after four years of major restructuring of the banking system, eight names have disappeared from the market, which are MDBank, MHB, DaiABank, and Ficombank, as well as TinNghiaBank, SouthernBank, WesternBank and Habubank. Economist Tran Hoang Ngan said the current number of banks was ‘reasonable'. However, he said it was not important how many banks were operational, but how to manage the banks in the most effective way. After the restructuring, all weak banks had recovered well in accordance with plans set up by the central bank, Ngan said. Deputy Chairman of the National Financial Supervisory Committee Truong Van Phuoc said despite the huge difficulties in the debt settlement process, the banking system still could make profits. Except three banks that made losses, the system still could make a post-tax profit of 34 trillion VND (1.517 billion USD) in 2014, an increase of 5.3 percent when compared with 2013, and 13.8 percent when compared with 2012. Forum boosts Vietnam-Russia trade links The Vietnam - Russia Business Forum took place on December 14 in Hanoi , discussing the two sides’ economic cooperation within the framework of the Free Trade Agreement (FTA) between Vietnam and the Eurasian Economic Union (EAEU). The event, organised by the Vietnam Chamber of Commerce and Industry (VCCI) in collaboration with the Russian Trade Representative Agency in Vietnam , also aimed at strengthening economic and trade ties between Vietnam and Russia , as well as boosting export-import activities between their enterprises. VCCI’s Deputy Chairman Hoang Quang Phong said business communities would be provided information and consultation on the terms and commitments of the Vietnam-EAEU FTA as well as investment mechanisms and preferential policies. In parallel with the business forum, the EXPO Russia-Vietnam 2015 is being held from December 14-16. About 40 Russian enterprises are showcasing their latest technologies in various fields, including energy, mechanical engineering, transport infrastructure, telecommunication and communications, mining, chemistry, medicine and agriculture, said Zarubezh-Expo Chairman David Vartanov. Vietnam signed a FTA with the EAEU, including Russia , Kazakhstan , Belarus , Armenia and Kyrgyzstan , last May. Vietnam and Russia have implemented their strategic partnership for more than ten years and comprehensive strategic partnership for three years. Two-way trade hit 2.55 billion USD last year and 1.4 billion USD in January-August. Vietnam has invested 2.4 billion USD in 18 projects in Russia. Steel industry growth hits record in 11 months The steel industry has seen a record growth over the first 11 months this year, up 30.1 percent from the same period last year, according to the Vietnam Steel Association. Producers sold nearly 5.9 million tonnes of building steel products to the local market, gaining a year-on-year increase of 24.3 percent in the reviewed period. The two key producers are the Vietnam Steel Corporation with 1.35 million tonnes and Hoa Phat Steel Company with 1.27 million tonnes, together making up of 43 percent of the market share. The Association reported that in November alone, the consumption of building steel saw an increase of nearly 30 percent from the same period last year to hit 593,000 tonnes. Vice President of the Association Nguyen Van Sua said industry insiders have renovated technologies to reduce cost, improve their competitiveness, and better integrate into the international market. He also called for relevant bodies to take technical measures to better manage import-export activities to support domestic steel producers. Businesses need better understanding of AEC Having a deep comprehension of the ASEAN Economic Community (AEC) will help Vietnamese businesses grab opportunities, integrate effectively, and gain initiative in the regional and global playgrounds, heard a forum in Hanoi on December 13. The business community is yet knowledgeable about the market or fully aware of the significant role of the AEC – which is set to take shape later this year, experts said. Deputy Director of the Central Institute for Economic Management (CIEM) Vo Tri Thanh said ASEAN is regarded as an Asian centre of connectivity in the global value chains. Understanding ASEAN thoroughly and making right moves could enable businesses to reap a lot of benefits from the AEC participation, Thanh noted. Meanwhile, chairman of the Vietnam Chamber of Commerce and Industry (VCCI) Vu Tien Loc warned that the formation of the AEC will pose numerous challenges such as highly-competitive goods and services, development gaps, labour supply, and capital flow management. Local firms should, therefore, be well prepared to deal with these challenges while making the best use of opportunities to be brought in by the community, like training prorammes and business support policies and plans developed by global organisations, he suggested. According to Tran Thanh Hai, Deputy Head of the Department of Import-Export of the Ministry of Industry and Trade, the Government paved the way for businesses to make inroads by signing a score of bilateral and multilateral free trade agreements, along with making business-related procedures more transparent. The Government’s follow-up guidance will be significant so businesses can be adaptable and quick to learn as their regional peers and increase their competitive edge, he stressed. The creation of the AEC as part of the three key pillars of the ASEAN Community aims to develop a stable, prosperous, highly competitive economic association. The other two key pillars are the Political-Security Community and the Socio-Cultural Community. The AEC itself was built with four pillars: a single market and production base, a competitive economic region, equitable economic development and integration with the global economy. A scorecard was formulated to track the members’ progress implementing the plans for the AEC. ASEAN member states could enjoy a number of benefits following the establishment of the AEC such as rapid economic growth, more jobs, stronger foreign direct investment attraction, better resource allocation, and sharper production capacity and competitiveness. The bloc’s leaders set an ambitious goal of developing ASEAN into a single market and production base characterised by a free flow of goods, services and investments, as well as free flow of capital and skilled labour. Hanoi’s exports continue rebounding in November Hanoi recorded the third straight month of export increase in November, following a consecutive decline from May to August, according to the municipal Department of Industry and Trade. The capital city’s 11-month overseas shipments rose by 3.1 percent from the same period last year to 10.2 billion USD, compared to the respective figures for the 10 and nine first months of 1.5 percent and 0.2 percent, the department said. As much as 5.05 billion USD worth of goods was sold abroad by foreign invested companies through November, representing 49.5 percent of Hanoi’s total export revenue and an annual hike of 3.8 percent. Key commodities posted rapid export growth rates during the period included textile and garments (15.3 percent) thanks to boosted shipments to the US (up 28.6 percent) and Japan (9 percent). Meanwhile, the overseas sales of electronic components and peripheral devices climbed 2.2 percent due to soared shipments to Hong Kong (23.8 percent), the US (23.1 percent) and Japan (6 percent). A 6 percent augmentation was seen in the shipment of agricultural products, which suffered from considerable declines in the first eight months. The rise was attributable to a 35 percent surge in the pepper and cashew exports, making up for the unrecovered overseas sales of staple goods like rice, tea and coffee. In the 11 months, fair growth pace was also reported in footwear and leather goods (9.2 percent), and glass and glass products (8 percent) due to a rise in import demand from the Chinese and US markets. VN, Russian firms to expand ties Besides traditional co-operation areas, Vietnamese and Russian businesses should take initiative in widening their relations, vice chairman of the Viet Nam Chamber of Commerce and Industry (VCCI) Hoang Quang Phong told a business conference held yesterday in Ha Noi. Viet Nam was now a comprehensive strategic partner of Russia in the Asia-Pacific region. The bilateral relationship between the two countries has developed significantly in trade, investment, oil and gas and electricity, Phong said. The Free Trade Agreement (FTA) signed between Viet Nam and the Eurasian Economic Union (EAEU) in May will open up valuable opportunities for Vietnamese and Russian firms to accelerate their co-operation, he said, adding that the two governments had committed to create the most favorable conditions for enterprises to do business. Duong Hoang Minh, deputy head of the Ministry of Industry and Trade's European Market Department said many opportunities were awaiting Vietnamese exporters in the Russian market especially when the Viet Nam-EAEU FTA came effect in the near future. The pact will result in tax cuts to zero per cent on nearly 90 per cent of tariff lines. However, Minh also warned that enterprises should carefully study the exemption and reduction of specific tariff lines as well as regulations on origin to maximise the cut's benefits. The firms should also pay attention to ensuring product quality and safety if they wanted to deeply penetrate into the lucrative Russian market. In his speech at the forum, the chief representative of the Russian Trade Office in Viet Nam, Maxim Golikov outlined oil and gas, mining, transport, chemical, high-tech industries and agriculture as sectors that Russia prioritised to co-operate with Viet Nam. Two-way trade between the two countries surged rapidly from $500 million to approximately $3 billion in 2014. Trade was expected to hit $10 billion by 2020. In term of investment, as of October, Russian companies had 113 valid projects, capitalised at $2 billion, in Viet Nam. The largest share of Russian investment came into the processing and manufacturing sector with $1.1 billion. Meanwhile, the mining sector attracted $581 million and real estate trading lured $73 million. First in Viet Nam The industrial exhibition EXPO Russia –Viet Nam 2015, organised by Russian-based Zarubezh-Expo, took place on the same day in Ha Noi. Zarubezh-Expo Chairman David Vartanov said the expo, featuring approximately 120 enterprises from Russia, would showcase modern technology in various fields, including energy, mechanical engineering, transport infrastructure, telecommunications, communications, mining, chemistry, medicine and agriculture. Attending the event, VCCI vice chairman Phong said the expo would provide opportunities for Vietnamese enterprises to access the Russian market. The expo would create a favorable environment for the two side's businesses to seek business partners as well as expand collaboration in research and technological transfer, he said. Food safety scheme to launch The HCM City Department of Industry and Trade has chosen Hoc Mon Wholesale Market and Ben Thanh Market to implement a pilot food-safety market model, according to a report in Tuoi Tre (Youth) newspaper. At Hoc Mon wholesale market, slaughtered pigs are transported to the market and then cut up and sold to small traders at traditional markets in the city. The processing phase done at the market is clean and input tests are also done before the pork is sold. "I don't know about other places, but at this market pork must have a quarantine seal," Son, a pork trader at the Hoc Mon Wholesale Market, said. For many traders, the application of the safe food chain model at the market has brought many benefits. Many wholesale buyers previously were afraid of buying pork containing substances that make pigs lean. "Now it is good for me to sell pork with a clear origin and quarantine," said Hoan, another pork trader at the market. Small traders at many other markets not included in the city's pilot programme have strongly backed the new model. "Around the market, especially in the afternoon, a lot of pork is sold and I don't know about its quality. Only pork bought from wholesale markets and having a quarantine seal is allowed to sell inside the market," Truong, a trader at Hoang Hoa Tham Market in Tan Binh District, said. Similarly, traders at Ben Thanh Market were excited about the new programme. Tu Thi Muoi, a pork trader at the Ben Thanh Market for more than 30 years, said that both consumers and traders expected the model to be implemented soon. "Customers at my stall will feel secure about the origin of goods I sell," she said. Many vegetable and fruit traders at the market agreed that both consumers and sellers want to use safe products. Nguyen Ngoc Hoa, deputy director of the HCM City Department of Industry and Trade, said the food safety chain model at the two markets aimed to bring safe products to consumers. The pilot programme chose only two items, pork and vegetables, so that product traceability could be done easily, he said. Identifying safe pork Nguyen Hong Tham, director of An Ha Company, said that last October it opened its first stall selling pork that meets VietGap standards at Hoa Binh Market in District 5. The company purchases pigs from HCM City-based households practicing VietGap standards in their breeding. The company has set aside an area in its slaughterhouse to distinguish pigs that meet VietGap standards from normal ones before distributing the meat to the market. Feedback from customers was positive. Many customers living far from the market also buy safe meat at the market. Tham said it was not easy to distinguish VietGap pork from other pork. But pork containing substances to make the ainmals lean usually has more red colour than those without the substance, she said. Credit growth this year positive at 18% Credit this year could reach roughly 18 per cent, meeting the capital demands of the economy, deputy director of the State Bank of Viet Nam's Monetary Policy Department Nguyen Duc Long said. Long noted that the rise in credit was an indication of positive economic growth and improved consumption in the domestic market. Further, according to Long, the increase in credit was seen in the beginning of the year and continuing every month, instead of only during a few months at year-end, as seen last year. Statistics from the central bank showed that lending rose 14.5-15 per cent in the first 11 months.Also, the SBV reported that credit growth this year has been fundamentally fulfilled. The increases in banking capital this year has halved, though the economic growth rate has been maintained. The credit flow contributed to spurring the nation's GDP growth rate to 6.5 per cent this year. From 2006-10, credit growth surged 30 per cent, but GDP fluctuated at only 7 per cent. This year's capital flow has served production and ensured practical and sustainable economic growth, instead of being directed to vulnerable and bubble sectors, such as real estate and securities, as in the past. However, experts said that although the average lending rate this year has been cut by roughly 0.3-0.5 per cent against last year, it should be further reduced to cut costs for domestic businesses. Of note, economist Le Dang Doanh said that the interest rate gap between loans and deposits was too large, benefiting banks but causing difficulties for enterprises. Doanh said while inflation remained low at only 1 per cent, and deposit rate averages were 5 per cent per year, many businesses still have to borrow at rates of 11 per cent per year. Meanwhile, the rate for borrowing in Thailand and China are only 3 per cent and 4 per cent, respectively. Many banks have also launched preferential credit packages with low interest rates of 7-8 per cent per year, but they have not been easy to access, such as soft loans. Banks also acknowledged that only a few enterprises could qualify for these loans. Registration simplified for unlisted firms The new circular from the Ministry of Finance, providing guidance on trading rules for unlisted securities, is expected to improve the transparency of public companies and better protect investors' interests. The State Securities Commission (SSC) published Circular 180/2015/TT-BTC, dated November 13, under the Ministry of Finance, on the registration of securities trading on the trading system for unlisted securities, which will take effect on January 1, 2016. According to the new rules, the deadlines for trading registration of public companies, delisting or equitised enterprises have been shortened significantly compared with Circular 01/2015, issued early this year. Public companies that are not eligible for listing on the two stock exchanges must register for trading in the Unlisted Public Company Market (UPCoM) system within 30 days from the date of completion of the registration of the public company. Within 30 days of the closing day of the initial public offering, unlisted public companies or equitised enterprises must register for trading in the UPCoM system. The previous deadline was one year. The registration deadline for delisted public companies from the stock exchanges fully meeting the requirements for a public company has also been reduced from 30 days to 10 days (applicable to mandatory delisting, voluntary delisting and delisting due to failure to meet the listing requirements of the consolidated company or the acquired company). "This is positive news for the stock market as it expands the entities of trading registration on the UPCoM market to all public companies," analysts at FPT Securities Co said. The new rules will constrain eligible companies from avoiding listing or deliberately delisting on the stock exchanges, actions that may harm investors' interests. However, the new regulations have limitations, as penalties for companies that do not comply with the rules have not been defined, and this may reduce the enforceability of the circular, FPT Securities Co's analysts said. According to the latest data released by the SSC on November 30, 1,071 public companies had not listed their securities on the stock exchange or UPCoM market. To date, 683 companies are trading on the two national stock exchanges, while the listing number on the UPCoM market stands at 284. Major corporations that have not registered for trading include Vietnam National Sea Products Corporation, Saigon Beer-Alcohol-Beverage Joint Stock Company, Hanoi Beer Alcohol and Beverage Joint Stock Corporation, Cholimex Seafood and Foodstuff Processing Company and Hanoi Construction Corporation Joint Stock Company. DIV, PwC sign contract to expand IT application The Deposit Insurance of Viet Nam (DIV) and PricewaterhouseCoopers Viet Nam (PwC Viet Nam) Ltd signed an IT system consulting service contract in Ha Noi yesterday. The service aims to maximise the benefits of the Financial Sector Modernisation and Information management system (FSMIMS) project to protect depositors through advanced applications on the IT system. The bidding package contract, known as DT#3, verified the independence IT system of third parties under the Financial Sector Modernisation and Information management system (FSMIMS) project. There is a necessity to strengthen and perfect DIV into a powerful and more stable financial institution, of which, the role of modernising IT and communications system in the framework of FSMIMS project is very important, said Nguyen Quang Huy, Chairman of the Board, Head of steering committee of the project.  Inferior steel imports weaken sector Counterfeit and low-quality steel and iron products imported in bulk into Vietnam are tormenting the local steel sector’s major operators. According to the Vietnam Steel Association (VSA), the volume of low-quality imported iron has risen abruptly in recent years. Some 1,755 tonnes of coated steel was locally marketed last year. In this year’s first nine months, imported iron from China into Vietnam rose sharply, holding over 30% of the market share. More critically, counterfeit and low-quality products are seen nationwide now, though in past years, they were mainly restricted to certain localities such as Thanh Hoa, Haiphong, Bac Ninh, Bac Giang, and Thai Nguyen. Local producers reportedly incurred losses of VND935 billion (US$43 million) in this year’s first eight months due to the overwhelming presence of counterfeit and low-quality items. The steel sheet brand of the Hoa Sen Group is being imitated the most throughout the domestic market, as this steel giant currently controls almost 40% of the domestic market share of iron and steel products. Counterfeit items reportedly cost Hoa Sen about VND118 billion (US$5.4 million) last year, equal to a loss of 2.6% market share. Not only leading players like Hoa Sen, Nam Kim, or Dong A, but new brands such as Vnsteel Thang Long have also fallen victim to the harmful repercussions of widespread counterfeiting. “It took us a great deal of money and effort to carve out a niche in the market for the Thang Long and Viet Y steel brands. However, once these products secured an established reputation, counterfeit versions of our products began to appear with increasing frequency and volume, misleading consumers and hurting our operation,” said Trinh Dinh Hung, deputy general director of Vnsteel Thang Long JSC. Hoa Sen’s deputy general director Vu Van Thanh stressed that firms urgently needed support from government agencies such as the Ministry of Industry and Trade (MoIT), or the Ministry of Natural Resources and Environment to tackle the massive import of counterfeit and low-quality steel items into Vietnam. “Although authorised government agencies have joined the fight against counterfeit goods, the situation has not improved much. That is partly because the steel market is managed by several different agencies, none of which can be held accountable for controlling the quality of steel products,” said Do Thanh Lam, deputy head of the MoIT’s Market Management Department. “In addition, businesses need to supply relevant management agencies with the technical specifications and standards of their products to help the agencies differentiate between genuine and imitated versions of their goods,” Lam added. VSA’s deputy chairman Nguyen Van Sua said that the VSA had proposed imposing higher import duties on steel items that were oversupplied in the local market (such as painted steel) to limit such massive import volumes. “Our proposal was accepted by the General Department of Customs, but enforcement will come a bit later, in 2017, as we need to adhere to international commitments,” Sua said. Vietnam successfully produces fertiliser additives The PetroVietnam Fertilizer and Chemicals Corporation (PVFCCo) has inaugurated the unit of UFC85 - an essential additive in urea production at the Phu My Fertiliser Plant in Ba Ria-Vung Tau province. This is the first Vietnamese unit to produce additives for domestic fertiliser plants. The unit, with a capacity of 15,000 tonnes of UFC85 per year, was constructed at a cost of nearly VND500 billion. UFC85 is mainly used in urea fertilizer production as anti-caking and enhancement agent for urea fertilizer, as glue for wood processing, or as preservatives for medical and food industries. Currently, domestic fertiliser plants need around 14,000 tonnes of UFC85 per year, which they used to import. PVFCCo Director General Cao Hoai Duong said after Unit UFC85 is put into operation it will bring about a revenue of VND400-500 billion annually. Small businesses hold the key to unlock Vietnam, Russia trade The Vietnam Chamber of Commerce and Industry (VCCI) held a Vietnam, Russia Business Forum, December 12-14, to discuss measures to propel economic cooperation, trade and investment between the two nations toward their full potential. “The Trade Mission has worked hard to promote business relations between Russia and Vietnam,” said a Russian Trade Office representative at the forum, as it helps companies from both nations find partners in each other’s markets. Development of small and medium-size companies is crucial for Russia's growth, its economic resilience and adaptability as they are flexible and can quickly fulfil demand in new market niches. Additionally the representative underscored the point that small businesses create new sources of economic growth, enhance economic efficiency and create jobs and are the fundamental drivers of the nation’s economy. In this regard, the Trade Mission’s special role is to promote the interests of small and medium-sized Russian companies and to attract Vietnamese small companies to do business in Russia. The forum was timed to coincide with a Russia, Vietnam Industrial Exhibition (Expo Russia-Vietnam) at which more than 40 Russian exhibitors introduced their latest technological advances in a vast array of fields.   World Bank: AEC positioned for stable economic growth A recent report by the World Bank (WB) states the member nations of the ASEAN Economic community are poised to witness robust economic growth over the next two decades. The report says the economies in the region have prospered in 2015 thanks to an increase in foreign direct investment (FDI) and exports by foreign invested companies as well as increased commercial real estate construction. World Bank’s Senior Economist Sebastian Eckardt told a Vietnam News Agency reporter that deeper integration among ASEAN countries into the global economy will serve to further boost economic cooperation, trade and FDI. “Additionally, I think there are opportunities for Vietnam, in particular, to benefit from investment from outside ASEAN by investors who want to take advantage of Vietnam as an entry to the ASEAN market as a whole,” he said. “There are also going to be more opportunities for Vietnamese companies to invest in other ASEAN economies to increase trade links and benefit from new market opportunities in those markets.” However, Eckardt suggested that the Vietnam government continue to improve the business environment, simplify administrative procedures and ensure fair competition among domestic and foreign enterprises if it wants to attract more investment. At the Global Investment Forum held in Vietnam at the end of September, Prime Minister Nguyen Tan Dung stressed “Vietnam is actively and positively integrated into ASEAN, a dynamic market with a combined population of 652 million and gross domestic product (GDP) of about US$2.5 trillion. “With a relatively high economic growth rate, it is expected that by 2030, the bloc’s GDP will reach US$10 trillion,” said Prime Minister Dung The government leader said as part of an effort to entice more FDI, the government is making every effort to improve its market economy regulations, focusing on improving legal frameworks and administrative procedures, especially those pertaining to improving its work forces quality and infrastructure. The Law on Investment and the revised Law on Enterprise, which took effect July 1, 2015, provided information on prohibited and conditional business sectors. Therefore, they act as a guideline for foreign investors who wish to invest in Vietnam. According to economic experts, Vietnam will most likely attract selectively high value-added and quality, modern technology and environmentally-friendly projects, as well as large scale projects with competitive products that participate in global value chains of transnational companies. The country will also encourage, create good conditions for and strengthen connections among foreign invested businesses, as well as between them and domestic ones. In the coming time, especially as Vietnam joins the ASEAN Economic Community (AEC) at the end of this year, the liberalization of trade and services will not only help enhance foreign investors’ trust in ASEAN, but also contribute to strengthening regional investment. A representative of the army-run telecom group Viettel said ASEAN is an attractive market, as ASEAN states have close economic ties with Vietnam. The group is investing in Cambodia and Laos. Of these, Cambodia is its largest market. At the 27th ASEAN Summit in Kuala Lumpur, Malaysia, leaders of the regional countries signed the “2015 Kuala Lumpur Declaration on the Establishment of the ASEAN Economic Community” on December 31, 2015, in the witness of leaders from dialogue partners and the United Nations. The establishment of AEC will become a turning point, marking the comprehensive integration of the Southeast Asian economies says the World Bank. Regional economic competitiveness will improve, making ASEAN a large potential market most lucrative to foreign investors. Over 18,500 foreign stock investors granted trading codes in Vietnam The Vietnam Securities Depository (VSD) has granted trading codes to 18,508 foreign investors so far, including 2,864 organizations and 15,644 individuals, according to the depository. The VSD said in a report earlier this month that it had provided trading codes for 661 foreign institutional investors and 277 international individuals in the first eleven months of this year, the highest number of individual foreign investors licensed since 2011. Vietnam continues to welcome more foreign investors opening securities trading accounts three months after the prime minister’s decision to scrap a foreign ownership cap in many Vietnamese listed firms took effect, the depository said. In July Prime Minister Nguyen Tan Dung decided to scrap the 49 percent foreign ownership limit across many listed firms, starting in September. However the foreign cap of 49 percent will still apply to areas where ‘conditions’ are placed on foreign investments, except for sectors governed by separate ownership regulations, such as banking, where total foreign stakes are limited to 30 percent. According to the VDS, in November alone, the agency supplied trading codes to 95 foreign investors, including 24 organizations and 71 individuals. It has approved changes for 25 foreign investors, including six organizations and 19 individuals, and the cancelation of securities trading codes for one foreign organization. In November, foreign investors on the Ho Chi Minh Stock Exchange (HoSE) and the Hanoi Stock Exchange (HNX) acquired 180 million shares in total, worth more than VND6.46 trillion (US$284.24 million), while selling over 170 million shares, worth nearly VND6.84 trillion ($300.96 million). On the HoSE, foreign investors were in net-selling mood with 744,980 shares worth VND491 billion ($21.6 million) in November, after an opposite move of over VND1.128 trillion ($49.63 million) in October. In the first 11 months, foreign investors maintained their net-buying mood on the HoSE with more than VND4.1 trillion ($180.4 million), corresponding to a net-buying volume of more than 292.8 million shares. Contrary to the situation at the HoSE, foreign investors on the HNX in November remained in positive mood with a net-buying volume of 10.66 million shares worth more than VND114.3 billion ($5 million), up 2.8 times in value month on month. Therefore, from the beginning of 2015, foreigners on the HNX had seven months of net-buying and four months of net-selling, with a total net purchase value of over VND926.4 billion ($40.76), representing a net-buying volume of more than 80.9 million shares. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR