BUSINESS IN BRIEF 5/5

Asia-Pacific’s growth remains strong for 2016, 2017: IMF

 

Growth in Asia-Pacific economies is expected to decelerate slightly to about 5.3% during 2016–17, according to the latest Regional Economic Outlook for Asia and Pacific, published on May 3, 2016.

According to the report, China’s growth is forecast to reach 6.5% in 2016 and 6.2% in 2017, which will be less than the country’s growth pace of 6.9% in 2015 – the poorest growth in the last 25 years.

Japan’s growth is expected to continue at 0.5% in 2016, before dropping to -0.1% in 2017 as the effect of the widely anticipated consumption tax increase takes hold, as well as an aging population and high public debt.

India remains the fastest-growing large economy in the world with gross domestic product (GDP) expected to increase by 7.5% this year and next, due to the low price in petroleum and a rise in the government’s investment and in domestic consumption which make up for the country’s swooning export activity.

Meanwhile, the Republic of Korea is forecast to climb by 2.7% in 2016 and 2.9% in 2017, thank to a surge in domestic demand. Australia’s economy is expected to remain stable at 2.5% this year.

The IMF said economic stimulation measures by Asia-Pacific governments, have reduced the price of goods, lowered the unemployment rate and helped to boost growth in the region.

The organisation also said that in order to cope with global risks, regional lawmakers should promote restructuring programmes to increase productivity while generating financial sources.

EU trade deal may result in growing Vietnam trade deficits

As part of a continuing effort to support European companies gain access to the Vietnam market, the EU-Vietnam Business Network (EVBN) organized a recent dialogue in Ho Chi Minh City.

The event was the result of a collaboration with the European Chamber of Commerce in Vietnam (EuroCham), a non-government organization with its headquarters in Ho Chi Minh City.

The EVBN is comprised of 19 EU companies from the nine countries of Belgium, Bulgaria, France, Lithuania, Italy, Ireland, Poland, Portugal and the UK. EVBN receives its financial funding from the EU Delegation to Vietnam and the EU Ministry of Foreign Affairs.

The dialogue featured high profile speakers from various EU ministries including the EU Delegation, Ministry of Industry & Trade, Ministry of Agriculture & Rural Development, Ministry of Science & Technology and Ministry of Health, Ministry of Finance as well as representatives from EU member state embassies.

In addition, a large number of Vietnam governmental officials, local businesses, non-governmental organizations and experts in diverse prospective fields were in attendance.

The dialogue was a follow-up to similar ones held subsequent to the launch of the EuroCham Whitebook earlier this year on March 2 and was a valuable opportunity to promote the collaboration between EU and Vietnam in the context of the EU-Vietnam Free Trade Agreement.

Following the EuroCham Sector Committee presentation on regulatory issues and recommendations, EU companies were provided a chance to raise their concerns related to market access during an interactive and fruitful open discussion with representatives from the Ministry of Industry and Trade, Ministry of Health, Ministry of Science & Technology and Ministry of Finance.

The dialogue also addressed key impacts of the EU-Vietnam Free Trade Agreement (EVFTA) on the business communities both in the EU and Vietnam and the readiness of the Vietnam government in preparing for implementing the EVFTA.

Among the many speakers was Miss Miriam Garcia Ferrer, head of the trade section of the EU Delegation to Vietnam, who along with other leaders plays an instrumental role in preparing for implementing the agreement.

Other speakers included Mr Le Trieu Dung, deputy director general of Multilateral Trade Policy Department under the Ministry of Industry and Trade who discussed the changes brought about by the EVFTA and what need be done to prepare for implementing the agreement.

The presentations were followed by a stimulating and constructive panel discussion where an update and recommendation towards the realization of the Vietnam government commitments executed under the EVFTA were openly discussed.

A significant area of discussion was with regard to the free trade agreement and the likelihood that Vietnam local businesses stand to lose their trade advantage and surplus they have enjoyed with the EU over the past 10 plus years.

According to statistics of the General Department of Vietnam Customs for 2015, which were cited by Miss Ferrer, Vietnam exports reached US$30.9 billion for which Vietnam enjoyed a trade surplus.

However, after the free trade agreement is fully implemented the current trade surplus will most likely turn into a trade deficit as more and more EU businesses migrate to operate their companies in Vietnam.

The bottom line is that Vietnam is a choice location of EU investors, and as a result more companies will likely migrate here making it more difficult for local companies to compete, unless they can up their game and become more competitive.

The areas Vietnam companies are weakest in competing said Miss Ferrer, are those related to quality, food hygiene and safety— for which the EU requirements are some of the strictest in the world.

Canada energy firm eyes US$150 mln solar power plant in Vietnam

Canadian company CMX Renewable Energy Inc. has sought a license to build a 150-megawatt solar power plant in the central province of Ninh Thuan at an estimated cost of US$150 million, news website Dau Tu has reported.

Around 1% of the plant's output would be provided free to locals, a company executive was quoted as telling the province's authorities at a meeting.

CMX is the latest foreign investor to have expressed interest in producing solar energy in Vietnam even as the government is drafting policies to encourage private investment in the sector.

According to one of the plans being considered by the government, state monopoly Electricity of Vietnam and other electricity distributors will be obliged to buy all the output from solar power plants in 10-20 years, the government's website reported.

The plants are also expected to get special treatment with respect to taxes and land, it said.

With around 2,000-2,500 hours of sunlight annually, Vietnam's solar energy potential is considered to be the equivalent of 43.9 million tons of oil a year.

However, the country's first solar power plant will not go on stream until next year. It is a 19.2-megawatt plant being built in the central province of Quang Ngai by Vietnamese investor Thien Tan Group at an estimated VND862 billion (US$36.12 million).

Last year South Korea's SolarPark Korea Company sought to build a 300-megawatt plant in another central province, Ha Tinh, at US$650 million.

Another Korean investor, conglomerate Hanwha, also reportedly planned to invest US$200 million in developing a 100-200-megawatt plant in Thua Thien-Hue.

Retailers exit shopping malls in HCM City

Individual shopping mall vendors in across Ho Chi Minh City have been leaving, due to continuously rising costs and weak sales.

At midday on a recent weekend in Now Zone shopping mall, located in District 5, even discount signs of up to 50% off fail to attract the attention of passing shoppers.

“There’re slow days on which only one to two items are sold. Our average monthly sales oscillate between VND30 million (US$1,345) and VND45 million (US$2,018), which means a loss, Q., owner of a stall selling famous Korean cosmetics, lamented.

Retailers at Saigon Pearl, a recently opened mall in Binh Thanh District, are not faring any better.

A number of unoccupied spaces stick out across its three first floors, despite the mall’s auspicious location.

A shop assistant takes a nap during working hours at a deserted Saigon Pearl Plaza stall in Binh Thanh District, Ho Chi Minh City.

The eye-catching jewelry, clothing and sports shops remain unnoticed, even by window shoppers.

Though shops at established malls including Vincom A, Vincom B, Diamond Plaza, Parkson Ly Tu Trong, Parkson Truong Son, and Crescent Mall appear busy, most visitors are cinema goers or diners.

Despite its bustling appearance, investor V.’s mall chain, scattered across District 1, have also languished and contain a large number of unoccupied stalls.

According to investors and stall owners, weak sales at shopping centers has existed since mid 2015, with only a slight improvement recorded before this year’s Tet (Lunar New Year), which fell in early February this year.

The investor of a T. cosmetics chain added that the number of customers has slumped since Tet, including on weekends, though the situation brightened up substantially on Valentine’s Day and International Women’s Day (March 8).

Year on year sales have plunged by 20%-30% against the same period last year.

Shop owners at less luxurious malls have also complained that they maintain their loss-making business mainly to collect debts from their clients.

Cosmetics vendors at Now Zone center bemoaned their monthly revenues vacillating between VND70 million (US$3,097) and VND140 million (US$6,193), or a 10%-20% drop against previous years.

Three sales clerks idling around at Now Zone mall in District 5.

The quality of products at malls, however, is not always guaranteed.

Apart from righteous shop owners, more than a few others cunningly sell shoddy goods or even copycats at the sme price as foreign brand items, according to investors.

Kha Tu, a long-time supplier of clothing items at shopping malls, revealed that a number of shop owners choose to purchase low-quality goods from local or Chinese producers before labeling them with famous brand names.

Exorbitant prices have also driven customers further away from extravagant shopping centers.

Surveys conducted by Tuoi Tre (Youth) at a number of malls revealed that items displayed at these centers fetch prices 10%-20% higher than those at other places or even more.

Exorbitant leasing fees have also driven retailers to turn their back on luxury malls.

According to the Tuoi Tre surveys, shop owners pay rents of US$20-US$37/m² per month for spaces in inner-city areas, and as low as US$10/m² per month in suburban districts, excluding value-added tax.

Tran Thuy Khanh, sales manager of T. fashion brand, said her company had finally given up on a shop housed inside Vincom mall in District 1 over steep rent and plummeting sales.

Part of Now Zone mall in District 5, which is empty of customers despite numerous discounts

“We paid US$5,000 for our 80m² shop each month, but the shop earned us less than one-fifth of the sum in turnover,” she explained.

“We persevered for one year before finally succumbing,” Khanh added.

Meanwhile, Tuong Vi, owner of K.N. furniture brand, said that she is considering insisting on lower rents from owners of shopping malls in inner-city areas because of intolerably sluggish sales since Tet.

The brand is currently sold in eight shops nationwide, though even the best selling store at Vincom B Mall in downtown Ho Chi Minh City continues to make a loss.  

Nguyen Huu Phung, chair of Viet Fashion Corp., acknowledged that despite heavy losses and costly rents, local retailers try their best to run their shops in malls in a bid to increase their coverage and better promote their brands.

“Meanwhile, it’s not difficult for foreign players who boast abundant capital to rent auspicious locations while waiting for the local economy to spring back to life,” he noted.

Le Hoang Chau, president of the Ho Chi Minh City Real Estate Association (HoREA), asserted that the metropolis, with its population exceeding 10 million, is a haven for shopping malls.

However, residents’ low incomes have stifled their purchasing power, and kept them from consistently shopping at malls.

Despite overwhelming hurdles, many businesses keep on with the shops at the malls for long-term growth.

“Many local and foreign retailers have been racing for the best retailing spaces. Several brands, mostly foreign ones, have dominated the retailing market,” Chau stressed.

Apartment buildings with malls integrated fetch higher prices than their counterparts without these structures.

In recent times, a number of commercial centers have carried out revamps to better tailor the centers to today’s shopping trends.

Large-scale centers offering a wide variety of items and recreational services have taken the lead.

New commercial projects have dedicated major areas to customer magnets including restaurants, cafes, game areas, and electronic showrooms.

Among them is Vincom Mega Mall, situated in District 2, which operates the city’s first ice-skating rink.  

Aeon Mall Celadon, in Tan Phu District, has lured young visitors with hi-tech games.

9 foreign funds buy into Vietnam's top mobile retailer

Nine foreign funds have acquired more than 4.4 million shares, or a combined stake of around 3%, in one of Vietnam's biggest mobile retailers - The Gioi Di Dong (Mobile World Group).

The funds, including the US's Chambers Street Global Fund and Thailand's Thanachart Securities Pcl, bought the shares from British Virgins Islands-incorporated CDH Electric Bee Limited, Vietnam Securities Depository reported on April 29.

The deal was reportedly worth around VND334 billion (US$14.8 million) in total.

Electric Bee, which bought nearly 20% of the company in 2013, now owns a stake of 5.27%, following several sales over the years.

Reports by market research firms and The Gioi Di Dong suggested the company now controls around 30% of Vietnam's mobile retail market with 646 stores around the country.

The retailer, which also runs a chain of 91 home electronics stores and online sale services, reported revenues of more than VND9.6 trillion (US$425.6 million) in the first quarter, an increase of 75% from the same period last year.

Its online sales doubled to VND680 billion (US$30.14 million) in the first three months, or around 7% of the total revenues, according to the company's new data.

In a January report, London-based market research company Euromonitor named The Gioi Di Dong as Vietnam's biggest online retailer with a market share of 10%, local media reported. It was followed by Germany's Rocket Internet with popular e-commerce businesses Lazada and Zalora, and tech giant FPT.

Bac Lieu expands brine shrimp farming area

The Mekong Delta province of Bac Lieu aims to expand Artemia (brine shrimp) farming from 200 hectares to 500 hectares, mostly in coastal localities by 2020, according to local authorities.

More than VND17 billion (US$765,000) will be invested in infrastructure facilities, technology transfer, breeding and marketing, said Chairman of the provincial People’s Committee Duong Thanh Trung.

Focus will also be put on establishing cooperatives and expanding consumption for the product, Trung said.

According to Cao Thanh Van, Chairman of the Artemia Vinh Chau – Bac Lieu Cooperative, there are 140 Artemia farming households in the province, with a combined areas of nearly 200 hectares, up nearly 50 percent from last year.

A three-month crop of Artemia can produce between 100 – 150 kg of eggs per hectare breeding Artemia, generating some VND40 million-50 million (US$2,250) for farmers.

Artemia eggs can be used to feed aquatic species, particularly young shrimp.

Artemia is a genus of aquatic crustaceans, known as brine shrimp. It can tolerate varying levels of salinity, suitable for the coastal province of Bac Lieu. Atermia eggs are mostly shipped to European nations and Japan, Thailand and Turkey, Van said.

Vietnam expects to become world’s banana leading exporter

Vietnam’s banana has successfully conquered Japan’s market with first bunches hitting shelves of Don Kihote chain of supermarkets.

Around 15 tons of bananas exported by Huy Long An Company are being sold at Don Kihote supermarket in Tokyo, Saitama and Chiba.

The Japanese importer plans to double volume and expand distribution networks in the coming time.

Hidekatsu Ishikawa, President of the Japanese importer, VIENT Company spoke highly of Vietnamese bananas. He said that they are suitable to the taste of Japanese consumers and have competitive prices.

He revealed that other local supermarkets in Niiggata also sell Vietnamese bananas.

Vietnam began to export bananas to Japan in early 2013 but did not enter strong supermarkets like Don Kihote.

This official presence of Vietnam’s bananas at Japan’s retail network provided a number of opportunities for Vietnamese exporters to expand distribution networks and improve the quality of products.

According to the Ministry of Agriculture and Rural Development, China, Singapore, the Republic of Korea and many Eastern European countries has suddenly increased their imports of Vietnamese bananas.

China is demanding for 20-30 tons of bananas per day while Japan needs around 15-20 tons, however, Vietnam is unable to meet their demands yet.

The Pilipino Banana Growers and Exporters Association (PBGEA) said Vietnam is likely to replace the Philippines to become a leading exporter of bananas.

Seafood export forecast to surge

Vietnam Association of Seafood Exporters and Producers (VASEP) forecast seafood exports will jump high this year thanks to stable supply and demand recovery in major export markets.

Of which, tuna exports are expected to rise by 12% to US$507 million, squid and octopus exports by 10% to US$470 million and crab and sea fish by 13% to US$1.3 billion.

According to statistics from the General Department of Vietnam Customs, seafood exports rose by nearly 6.4% to US$1.45 billion in the first quarter of this year, of which two key products – shrimp and tra fish grew 8% and 2.4%, respectively.

VASEP reported that raw material supply for the seafood processing industry and exports are sustainable as fishing output rises and fishermen are supported by the Government and authorities to apply advanced technologies in fishing and fish preservation to improve the quality of products.

Seafood output in the first four months of this year is estimated to reach more than 1 million tons, up 3%.

Ocean tuna output also jumped high. In the first four months, 8,413 tons of tuna were caught in major fishing grounds in the provinces of Binh Dinh, Khanh Hoa and Phu Yen.

China invests over US$56 bil in Vietnam

As many as 4,759 investment projects by China (including Taiwan, Hongkong and Macau) in Vietnam capitalized at US$56.7 billion remained valid by the end of last year, according to Foreign Investment Agency under the Ministry of Planning and Investment.

Of the figure, Taiwan invested in 2,478 projects capitalized at nearly US$31 billion, China with 1,296 projects valued at roughly US$10.2 billion projects, Hong Kong with 975 projects valued at US$15.5 billion and Macau with 10 projects capitalized at US$57 million.

China takes the lead in total investment value, followed by the Republic of Korea with US$45.2 billion, Japan with US$38.9 billion and Singapore with US$35.1 billion. However, each China invested project is valued at only US$12 million compared to the average value of US$19 million.

Most of Chinese investors focus on processing and manufacturing industries, construction and real estate.

Their attractive investment destinations are HCM City, Binh Thuan, Ha Tinh, Dong Nai, Binh Duong, Lao Cai, Hai Phong and Quang Ninh provinces.

With Vietnam’s entry into Trans-Pacific Partnership (TPP) and Free Trade Agreements (FTAs), it is predicted that China will pour investment in dyeing and processing industries in the country in the coming time.

Vietnam driving consumer electronic sales in Asia Pacific: GfK

Half of all internet users in the Asia Pacific region purchased at least one consumer electronics product online in the past year, with Vietnam one of the region’s strongest drivers of consumer electronic sales, a recent study by GfK has revealed.

85% of consumers polled across the Asia Pacific have purchased an electronic item in the last 12 months, with half of them having made the purchase online, GfK said on May 3, citing its own survey findings.

Smartphones were the most bought item both online and offline across the ten markets surveyed, with India, Vietnam and Indonesia at the top of the list, according to the German market research firm.

“Within the Asia-Pacific region, developing countries like India, Vietnam and Indonesia have been strong drivers of consumer electronic sales in recent times,” noted Jake Shepherd, GfK’s head of retail in the region.

“The huge, yet largely untapped potential of the e-commerce industry in these markets is now growing rapidly on the back of deepening internet penetration and the adoption of connected technology.”

The Asia Pacific is forecasted by GfK to be the fastest growing region in the world for smartphone sales in 2016. The research firm also said that the explosion of digital devices and the proliferation of the internet has, and are still in the process of altering the way consumers in the region shop.

However, according to survey findings, although all product categories reported some online sales, offline sales still tend to dominate in most product categories.

For instance, while 69% of Vietnamese consumers bought a consumer electronic product in the last 12 months, only 20% made the purchase online—suggesting an opportunity for the remaining consumers to take their transactions online.

According to GfK, travel and bill payments are the two key areas where online has significantly surpassed offline transactions.

While half of all consumers in the Asia-Pacific bought a travel product online in the past year, only one in five used an offline channel, according to the survey’s findings. The highest incidence of travel-related sales was seen in Hong Kong, Singapore, Malaysia, and Indonesia at 69%, 68%, 67% and 67%, respectively.

“Consumers tend to prefer acquiring tangible products at a bricks and mortar store due to the ‘touch-and-feel’ factor, and travel is a unique category that is unlike a physical product,” explained Jake Shepherd.

“Besides, the availability of a wide range of reputable online travel agents offering competitive prices at the click of the mouse makes it even more compelling for consumers to book their travel online.”

The GfK survey was conducted online between February and March 2016 with nearly 6,500 regular Internet users between 18-55 years across ten Asia Pacific countries and territories-Australia, Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, Taiwan, Thailand and Vietnam.

The study provides a product level understanding of online and offline shopping behaviour (over the past 12 months as well as future intention) for 65 product categories, as well as ‘deep dive’ insights on the online purchase journey for smartphones, tablets and panel TVs.

Fruit exports to increase 11% to US$2 billion

Vietnam’s fruit exports to foreign markets are expected to surge 11% to US$2 billion this year, according to the Ministry of Agriculture and Rural Development (MARD).

Vietnam’s fruits are currently available in 40 countries in the world including some demanding markets. Especially, Vietnamese exporters have tapped new markets such as the EU, Canada, ASEAN, Eastern Europe, the Middle East and South America.   

Since the beginning of the year, the Plant Protection Department has submitted a request for fruit exports to Argentina, Brazil and Peru. Currently, these nations are considering necessary procedures for Vietnam’s fruits entering their markets.

Tough road ahead as HCM City considers clearing makeshift markets

You may not be unfamiliar with hundreds of makeshift markets in operation across Ho Chi Minh City, where vendors make use of any available street space to sell a wide variety of produce.

The municipal health department has been making plans to consign such markets to history, with a detailed proposal already submitted to the city’s administration.

The proposed measures include setting up an agency in charge of ensuring food safety in the city and creating a campaign to remove the so-called ‘temporary markets’, though authorities are aware that it will not be easy.

Most vendors who sell goods on the street say they know they are occupying the pavements or public space, but they have no other choice and will defy all regulations to earn a living.

Despite the pushback, no market exists without shoppers, and even with questionable hygiene and safety standards, makeshift markets are never short of customers, as people find it more convenient to drop by a vendor sitting on the street to buy the food needed for their dinner.

This saves buyers a lot of time as there is no need to park their motorbike, or stand in line at the supermarket.

Tran Thi Thao, 54, has been selling pork at a makeshift market inside an alley in Binh Thanh District for ten years, as she cannot afford a booth inside an official market.

She pays VND2 million (US$90) a month to lease a ‘premise,’ spanning a few square meters in front of a motorbike repair shop, and puts the meat on a plastic cloth.

“If all makeshift markets are cleared, I will not know what to do to earn a living,” she said.

Vendors on makeshift market streets have to look for buyers and at the same time prepare themselves to run when local police officers come.

They put all their stuff into bags and run into the nearest alley for shelter, but soon return and put everything back on the plastic cloths once officers are out of sight.

“No one would sell on the street if they could afford a booth inside official markets,” Nguyen Minh Hoang, a vegetable vendor, said.

Several consumers told Tuoi Tre (Youth) newspaper that they usually drop by makeshift markets to buy food because it is “fast and convenient,” while prices are much cheaper than in supermarkets.

“I have never been to a supermarket,” Van, a frequent buyer from a makeshift market in Go Vap District said.

“The food is fresher and cheaper here, and you do not have to park your bike.”

Makeshift markets are also known as temporary, jerry-built and pavement markets, and are not recognized by the law but preferred by market-goers, according to an official from the city’s trade department.

The temporary markets serve busy people who do not have time to shop at traditional markets or supermarkets, he said.

“But these facilities are not under the management of regulatory agencies and do not pay taxes, which affects the city’s revenue,” he added.

“They also pose pollution and food safety threats.”

It has until now been impossible to crack down on makeshift markets.

“We do run campaigns to remove those vendors and fine them, but we cannot do this on a daily basis,” Le Thanh Tai, chairman of Ward 13 in Go Vap District, said.

Tai said it is an even more difficult issue to handle given 80% of the vendors are migrants.

Vietnam benefits from TPP, EVFTA to grow in two next year

The Trans-Pacific Partnership Trade Agreement (TPP) and the EU-Vietnam Free Trade Agreement (EVFTA) will give Vietnam more opportunity in attracting foreign investment, expanding markets and exports, reported the UN Economic and Social Commission for Asia and the Pacific (ESCAP) yesterday.

In the report released yesterday in Hanoi ESCAP forecast that Vietnam’s economic growth is expected to edge up further to 6.8-6.9 per cent in 2016 and 2017.

However, experts also warned that Vietnamese enterprises will face more stringent environmental and labor requirements may raise production costs in the short run.

Productivity improvement is an urgent matter for the Southeast country at present, said a representative from the Central Institute for Economic Management.

The sustainability of the economic growth greatly depends on the foundations of productivity, the representative said.

So Vietnam should continue the economic reform for raising productivity, focusing on the long term reform, easing regulations on business boundaries and invesment, renew ways to conduct reform; and encourage businesses and laborers to share benefits from the economic growth process, the representative added.

BASF Vietnam has new managing director

Tanachart Ralsiripong has been appointed as managing director of BASF Vietnam Limited, based in Ho Chi Minh City on May 1.

He succeeds Petrus Ng, who will become managing director of BASF Thailand.

Tanachart started his career with BASF in 2003. Subsequently, he held several management positions in the areas of sales, business development and marketing across Hong Kong, Thailand and Germany. Prior to this role, he was based in Thailand as local business manager – ASEAN, Intermediates.

He holds a Master’s degree in management and bioengineering from the University of New South Wales in Australia.

BASF has been active in Vietnam since the establishment of its representative office in 1994. BASF Vietnam Limited was set up in 2009 and the company has one production site for construction chemicals.

BASF Vietnam also maintains three sales offices in Ho Chi Minh City, Hanoi and Danang. It provides a wide range of products, including plastics, petrochemicals, construction chemicals, fine chemicals, performance chemicals, paper chemicals, and crop protection.

Investment into Ha Nam rises eight-fold

The northern province of Ha Nam lured more than 1.07 billion USD in investment since the beginning of 2016, an eight-fold increase from the same period last year.

According to the provincial Department of Planning and Investment, the money was poured into 27 projects, including ten foreign direct investment and 17 domestic investment ones, tripling last year’s number.

The locality currently hosts 562 valid projects with a total registered capital of 4.57 billion USD, 165 of which are funded by foreign investors.

One of the largest projects is a 135 million USD factory of the Hoa Sen Group that manufactures steel pipes, uPVC and HDPE pipes at the Kien Khe I Industrial Park. It is expected to offer approximately 1,000 job opportunities.

Highlights include those in the hospitality sector, for example, a 44.8-million-USD hotel and health care complex HJC and a five-star hotel by Muong Thanh Group worth 27 million USD.

The rise in investment was largely owing to the province’s efforts to improve the local business climate and investment policies. It has also worked hard in land clearance and infrastructure development as well as in providing support for investors.

In the following years, the locality aims to attract more strategic investors with more focus placed on potential investors from Singapore, Thailand, Taiwan and European countries.

Firms tend to cater to the young

 Nguyen Thanh Truc of HCM City's Binh Thanh District was looking to buy porridge for her sexagenarian parents at a supermarket.

But after spending more than 15 minutes to read the information on the packaging of several products, she could not find even one suitable – for instance, containing less salt and sugar and less or no fat — for people aged 56 or above.

The same is the case with bottled nutritional beverages, she said, adding only dairy products are available for a wide range of customers.

Nguyen Thi Thao, 73, of District 11 said she is unable to find a place that sells clothes for people her age, since most fashion companies only make products for people aged up to 50.

For the past decade she has had to go to tailors, she said.

Pham Xuan Hong, chairman of the HCM City Association of Garment, Textile, Embroidery and Knitting, said for long the garment industry has not made products for older people and its product segments are for children, teenagers, males, females and the middle-aged.

According to the United Nations Population Fund (UNFPA), Viet Nam entered the ageing phase in 2011 and is in fact among the most rapidly ageing countries in the world.

For the moment it is in a golden demographic period, with two-thirds of its population being of working age, but the over-60 population is expected to double from 10 per cent in 2011 to 20 per cent in 2030 and increase to 30 per cent in 2050, it said.

The ageing population has led to a tremendous demand for products and services required by that age group, but the Viet Nam Chamber of Commerce and Industry admitted products and services targeting the segment are limited.

Le Thanh Lam, deputy general director of Saigon Food, said the few food products in the market for older people are mostly imported.

Local products, even if good for older people, do not state so clearly since their producers are often afraid this would turn away people of other ages, she said.

Saigon Food has bird nest porridge that is suitable for older people, but the label does not say so.

Central city to build two green urban projects in second quarter

The central city will start construction of two green urban projects – Dragon City and Bau Tram Lakeside – in Lien Chieu and Hoa Vang districts in the second quarter this year.

The two projects will cover 154ha with an initial investment of VND1.3 trillion (US$57.7 million), and include apartments, villas, public entertainment areas, trading centres and living quarters with standard waste water treatment and communications.

Sai Gon-Da Nang Investment Company, the project's investor, said the two latest projects will provide green space and living areas in according to the city's Master Plan on westward development.

The two urban projects are scheduled to put into operation in 2019.

The company has invested in four urban areas and two industrial parks, along with one resort and a trading complex project in the central city.

Last week, the city also inaugurated the FPT Complex project within the ‘green' urban project invested in by the FPT Group.

Viet Tien Garment targets $13.6 million profit

Viet Tien Garment Joint Stock Corporation planned to reach a pre-tax profit of VNĐ305 billion (US$13.6 million) this year, up one per cent over last year.

The company's general director, Bui Van Tien, announced the plan at its shareholders' meeting late last week.

The firm also projected a turnover of VND6.7 trillion for 2016, a year-on-year increase of 6.2 per cent. It was expected to pay dividend at a rate of at least 25 per cent, and assure an average workers' income of VND8.8 million per month.

Tiến said the company would spend some VND700 billion on investments this year and next year to enhance production capacity, by improving human resources, innovating technology and intensifying distribution channels and promotion affairs.

Thach Thi Phong Huyen, the head of the company's supervisory board, said its financial situation was healthy, with the condition of equity, loans, debts, liquidity and provisional funds remaining good.

Viet Nam Textile and Apparel Association Chairman Vu Duc Giang noted that there was harsh competition in the Asian garment and textile market, and Viet Tien should have strategic measures for sustained development.

Viet Tien, which has recently increased its charter capital from VND280 billion to VND420 billion, is an affiliate of the Việt Nam Garment and Textile Group (Vinatex).

As many as 28 million shares of the subsidiary began to be traded on the Unlisted Public Company Market (UPCoM) on March 10, today closing up 0.3 per cent at VND61,500 per share.

Viet Tien celebrated its 40th year of establishment in HCM City on January 23, when officials from the company said it was expected to reach an export revenue of $1 billion by 2020, with an average export growth rate of 15 per cent per year.

The HCM City-based company has branches in Ha Noi and the central cities of Da Nang and Nha Trang. It owns brand names such as TT-up, San Sciaro, Manhattan, and Smart Casual, in addition to Viet Long, Viet Tien Slim Fit and Camellia.

Lobster farming to become key economic sector in central region

A Ministry of Agriculture and Rural Development master plan to develop lobster cultivation to 2020 with a vision to 2030 aims to make lobster farming a key economic sector in the central region.

Four types of lobsters, including Panulirus ornatus, P. hormanus, P. longipes and P. polyphagus, will be bred in Quang Binh, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan and Binh Thuan provinces as well as Da Nang city.

The ministry targets having 1 million cubic metres of lobster cage rasing, which creates a total output of 1,940 tonnes worth 3.2 trillion VND (143.6 million USD) every year. It expects that the country will rake in 4.3 trillion VND (192.9 million USD) from 2,680 tonnes of lobsters by 2030.

According to Deputy Minister Vu Van Tam, lobster farms will use advanced and environmentally friendly technology, aiming to produce high-quality products for domestic consumption and export.

The ministry also said that 4.5 million lobsters fry will need to be bred by 2020 while 5.5 million will be needed by 2030.

HCM City to host country's most exclusive real estate conference

The Property Report Congress Viet Nam 2016, the country's most exclusive real estate conference where Asian real estate leaders meet, will be held in HCM City on June 10.

The event will feature keynote addresses and panel discussions on burning issues facing the country's property market, such as infrastructure development, green building and the rise of secondary cities.

At least 25 speakers from Asian markets are expected at the one-day event.

Delegates will have a chance to learn from industry leaders who are redefining the property landscape, and, together with like–minded professionals, find solutions to these issues.

They will also have a chance to meet and mingle with the biggest names in Indonesian real estate, including winners and judges of the Indonesia Property Awards, and engage in a meaningful and informative discussion with them.

They can network with the biggest players in the Vietnamese real estate industry and their partners in architecture, design, construction, electronics, technology, marketing and new media advertising.

Fees for the congress, including the Vietnam Property Awards Gala Dinner, are US$200 (single ticket) and $300 (bundle ticket).

The event is part of the annual Vietnam Property Awards held by the Property Guru Group, Asia's leading property media group, with support from the Viet Nam National Real Estate Association and the country's only English language national daily Viet Nam News.

It will be held at the InterContinental Asiana Saigon.

For tickets or speaking opportunities and general inquiries, please email amy@propertyguruinternational.com or call +66 – 22049541 or +668 – 4492525.

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