BUSINESS IN BRIEF 28/6 FPT earning up in first five months of 2016 Software provider FPT announced its revenue during past five months reached nearly 14.6 trillion VND (653 million USD), earning a before-tax profit of more than 1 trillion VND. Gross profit was 722 billion VND, or 116 percent of the year's plan. Earning per share (EPS) after the first five months was 1,814 VND, equivalent to 116 percent of the year's plan. FPT closed June 24 session off 1 percent to 40,900 VND (2 USD). FPT's retail service also saw a growth rate of 33 percent in revenue and 37 percent in pre-tax profit.- Hanoi’s industrial production gains 7.7 pct in first half   The Index of Industrial Production (IIP) of Hanoi in the first half of 2016 rose by 7.7 percent from the same period last year, with June’s figure picking up 8 percent year on year. Several industries posted growth during the period, including manufacturing and processing (8.1 percent), electricity production and distribution (6.2 percent) and water supply and waste water treatment (0.9 percent). The three sectors also experienced a respectively increase of 8.4 percent, 8.7 percent, and 6.7 percent in June while the biggest gain last month (38 percent) was recorded by the mining industry. The manufacturing and processing industry saw significant growths such products as food (22.6 percent), clothing (38.9 percent), pharmaceuticals and medicine materials (24.1 percent), metal products (21.2 percent) and furniture (20 percent). The IIP of the capital city expanded 7.4 percent year-on-year during the first five months of this year. Tra fish exports reach 616 million USD in first six months Total export value of Tra fish reached 616 million USD in the first six months of this year, according to the Vietnam Association of Seafood Exporters and Producers (VASEP). The VASEP forecast that the Tra fish exports turnover this year would be 1.5 billion USD, a decrease of 5 percent compared to 2015. The decrease would be attributed to the enforcement of trade and technical barriers in many import markets as well as low consumption demands there. Vietnam is now shipping Tra fish to 150 countries and territories worldwide. Of which, the European Union and the US markets account for about half of the total exports. In 2015, Tra fish earned an export value of 1.6 billion USD, which was 10 percent lower than the value recorded in 2014, reported the VASEP.- Fruit exports to US, Japan up 80% Vietnam shipped more than 4,608 tons of fruit to demanding markets like the US, Japan, the Republic of Korea and New Zealand during the first half of this year, up 81% against the corresponding period last year, according to the Plantation Protection Department. The department attributed the upturn in export value to better disease controls on fruit and veggie, ensured quality of products and higher demands in key export markets. It is predicted that exports of fresh fruit will continue to rise in the coming time which is a right time for harvest season. Besides, other fruits like mango and star-apples have been granted licences to export to some other demanding markets. Kido gloves are off in M&A bout Kido Group plans to dominate the consumer foods market in 2016 by making aggressive merger and acquisition deals. During its recent annual general meeting, Kido Group (previously  known as Kinh Do Corporation whose nearly 20 per cents stake was   owned by foreign investors) announced its 2016 plan to continue its “Food and Flavour” strategy with a focus on consumer foods such as instant noodles, cooking oil, soy sauce, and ice-cream. To achieve this, Kido plans to merge with or acquire existing firms in the sector. The firm will use its ample cash reserves of VND3 trillion ($134.5 million) to carry out these mergers and acquisitions (M&A). According to Kido’s Board of Directors, M&As are the fastest and most stable option to venture into the consumer foods market, as the firm can take advantage of existing facilities and insider know-how. Firstly, the group will boost its ownership from 24 to 51 per cent at Vocarimex and nominate new executives to the latter’s board. As a major player in the Vietnamese cooking oil market, Vocarimex currently owns 51 per cent stake in Tuong An Vegetable Oil JSC, 49 per cent stake in Golden Hope Nha Be, and 24 per cent stake in Cai Lan Oil & Fats Industries Company. This means that through the takeover of Vocarimex, Kido will be able to learn the business strategies for the popular cooking oil brands Tuong An, Golden Hope, and Neptune. Secondly, Kido will continue its strategic partnership with Saigon Ve Wong in producing instant noodles. Still according to reports from Ho Chi Minh Securities, instant noodles seem to be the most challenging sector for Kido, as the market has been saturated with strong brands from Masan, Acecook, and Asia Foods. Moreover, according to statistics from the World Instant Noodles Association, the volume of instant noodle consumption in Vietnam has dropped in recent years. Specifically, the number of servings decreased from 5.2 million in 2013 to 5 million in 2014, and maintained the downward trend to 4.8 million in 2015. “As the Vietnamese economy grows quickly, any potential business sector has of course been covered already by many brands. Instant noodles are simply an example of this phenomenon. We’re confident that Kido will find our own segment in the competitive noodles market and reach a top-three position in the long run,” said Kido’s deputy chief executive officer Nguyen Thi Xuan Lieu. Kido is also actively seeking other M&A opportunities in the food and beverage sector. Its board of directors stressed that careful consideration was necessary to ensure long-term co-operation and a stable gain in market share. However, last year, Kido fell through in its well-publicised M&A deal with PhinDeli, a Vietnamese coffee brand with operations in the US. Kido attributed this failure to incompatibilities between PhinDeli’s products and Kido’s distribution network. On the selling side, Kido will withdraw completely from Kinh Do Binh Duong JSC by selling its remaining 20 per cent stake to Mondelez International. The firm’s confectionery arm had already been renamed Mondelez Kinh Do in March. Experts noted that Kido’s M&A strategy was somewhat similar to its rival Masan Group, which also dominates the Vietnamese food and beverage industry through a slew of aggressive M&As. In the past six years, thanks to its huge cash reserves and bank loans, Masan has acquired the café brand Vinacafe Bien Hoa, cattle-feed firms Proconco and Anco, pure water producer Vinh Hao, Saigon Nutri Food, and Cholimex. VSIP unveils innovative living Vietnam Singapore Industrial Park Joint Venture, or VSIP JV, which is well known as an industrial real estate developer in Vietnam, celebrated the structural topping-out of its first ever residential development in the country last week. The Habitat Binh Duong is located at the gateway to VSIP 1 at Huu Nghi avenue in the southern province of Binh Duong’s Thuan An district. The project has been undertaken by VSIP-Sembcorp Gateway Development Company Ltd. According to Nguyen Phu Thinh, general director of VSIP JV, the development is part of VSIP’s integrated township and industrial park concept. The aim here is to allow communities to flourish near their workplace, and to provide a safe haven for their families. “Previously, tenants have used leased land to set up facilities and accommodation for their workers. As VSIP pursues the new concept, we decided to develop residential projects in line with our standards to provide complementary services and amenities for the people working in the park,” Thinh said. “Once the Habitat Binh Duong becomes successful, we will replicate this model in other VSIPs nationwide.” The initial phase of the Habitat Binh Duong comprises two high-rise towers with 267 units offering two- and three-bedroom units, ranging from 58 to 103 square metres, and 15 dual-key apartments. Designed by Singapore’s award-winning RSP Architects, the project has the distinction of being the only residential development with dual-key apartments which comprise two separate units within: a two-bedroom unit and a studio unit. Daniel Lim, general director of RSP Architects Planners and Engineers Vietnam, said that “these apartments provide flexibility for a family to live together with their parents while maintaining privacy. Alternatively, they allow the owner to live in the larger unit and generate rental income from the studio unit at the same time.” Although this residential development caters to the mass market segment, VSIP also provides many value-added facilities, including a swimming pool, a gym, and security features for each tower. In addition, with more than 30 per cent of the site set aside for landscaping, the residences are nestled in an aesthetically pleasing environment. The garden itself is artfully designed with clusters of flowers accentuating a wide selection of lush foliage. Residents of the Habitat Binh Duong are offered peace of mind by virtue of the gated development’s security guardhouse, closed-circuit television  cameras in public areas, and card-controlled access to the two high-rise towers. The apartments come with amenities and standards befitting a premium condominium. The story of VSIP is similar to Singapore’s early years: creating jobs for the people and homes in safe environments for communities to spread their roots and raise their families; encouraging provincial growth with wealth that is funnelled back into the community to improve infrastructure such as schools and hospitals; and finally, fostering environments where businesses can flourish and investments can pour in. VSIP is a joint venture between Vietnam’s Becamex IDC Corporation and a Singaporean consortium led by Sembcorp Development. There are seven VSIPs nationwide with a total area of 6,153 hectares of land. The VSIPs are integrated townships and industrial parks. There are about 616 tenants employing 160,000 workers, and boasting a combined investment capital of more than $8.5 billion. Foreign landmarks rise in second city Foreign developers have been developing many landmark real estate projects across Ho Chi Minh City during the first half of the year. Before the visit of US President Barack Obama to Vietnam at the end of May, Dinh La Thang, Secretary of the Ho Chi Minh City Party Committee hosted US investors who expressed interest in a $4 billion multifunctional complex in the Thu Thiem new urban area, near the Saigon River. The interested parties are Steelman Partners, Cantor Fitzgerald, and Weidner Resorts. According to William Weidner, chairman and CEO of Weidner Resorts, by joining the Trans-Pacific Partnership Vietnam would attract investment from all over the world, and  Ho Chi Minh City in particular had strong development potential. Weidner Resorts is a developer and manager of a multitude of hotels and 5-star integrated resorts in the US and Asia. Meanwhile, Steelman Partners have been operating in Vietnam for several years, and is involved in a range of projects such as the Grand Ho Tram integrated resort in the southern province of Ba Ria-Vung Tau and Happyland Hotel in the southern province of Long An. Cantor Fitzgerald provides investment services and is present in 30 markets worldwide. New investment projects can also be seen coming from long time foreign investors in Vietnam, such as Temasek Holdings, Sembcorp Development Ltd, CapitaLand, Keppel Land, and Mapletree Investments. In April this year, Keppel Land, one of Singapore’s leading real estate investors, entered into a conditional investment agreement to subscribe a 40 per cent equity interest in Empire City Limited Liability Company, at a total cost of $93.9 million, to develop a prime 14.6-hectare waterfront site in Thu Thiem, located in District 2 of Ho Chi Minh City. According to CEO of Keppel Land, Ang Wee Gee, Vietnam, especially the fast-growing Ho Chi Minh City, is one of Keppel Land’s key growth markets. “We are very excited to participate in the growth of the up-and-coming Thu Thiem new urban area, which is poised to become the future central business district of Ho Chi Minh City,” said Gee. Also coming from Singapore, Sembcorp Development Ltd, a subsidiary of Singapore-based Sembcorp Industries, unveiled a plan to construct an innovation park in the city. At a working session with Ho Chi Minh City’s mayor Nguyen Thanh Phong recently, Sembcorp’s CEO Kelvin Teo said such an innovation park would attract scientists, interdisciplinary experts, technology developers, and investors from all over the world to develop value-added products. The park, which will cover an area of between 50 and 100ha, will include a commercial centre, research facilities, and residential quarters offering quality accommodation for scientists and expats. Sembcorp previously implemented similar parks in mainland China. The firm is also studying and searching for sites to develop three new industrial parks (IPs) in Vietnam. Sembcorp has so far invested in seven IPs and townships in Vietnam, worth more than $8 billion. In June, Mapletree Investments acquired Kumho Asiana Plaza Saigon in Ho Chi Minh City from Kumho Industrial Company Limited and Asiana Airlines Incorporated, to the value of $215 million. The takeover of Kumho Asiana Plaza Saigon, according to Mapletree’s leaders, will expand its business in Vietnam and deliver strong  returns. Mapletree’s CEO Hiew Yoon Khong said that this was the group’s largest acquisition involving a completed, income-producing property in Vietnam.  The group began investing in Vietnam in 2005, and today owns and manages a portfolio comprising offices, retail, industrial, logistics, and serviced apartment assets. Mapletree has over $1 billion in assets under management in the country and is also developing Saigon South Place, a 4.4ha  mixed-use project in Ho Chi Minh City, scheduled for completion by early 2018. Challenges faced by garment and textile industry ahead of TPP Vietnam’s garment and textile industry is targeting to earn an export revenue of US$31 billion in 2016, up 10% against the previous year. The figure is expected to be met in the near future, with motivation stemming from the recently-signed Trans-Pacific Partnership (TPP) and European Union-Vietnam Free Trade Agreement (EVFTA). However, many leading businesses in the sector are facing declines in the number of orders and export prices, which makes it very difficult for them to achieve the envisaged goals. Vietnam’s garment and textile exports only reached nearly US$8.5 billion in the first five months of the year, registering a year-on-year surge of 6.1%. As reported by a number of enterprises, export orders tended not to increase, which was accompanied by a decline in export prices and increase in production costs (comprising labour cost, electricity and water, insurance), resulting in a lot of drawbacks in manufacturing and distributing products. Similar circumstances are taking place more severely among small and medium-sized enterprises, which are facing fierce competition with regional opponents from Laos, Cambodia, Myanmar and Bangladesh. This indicates that Vietnam’s garments and textile industry is being confronted with numerous challenges as consumers have been switching part of their orders to several other countries such as Cambodia, Myanmar and Laos due to export tax incentives to Europe and the US – the two largest export markets of Vietnam’s garment and textile sector. Meanwhile, Vietnam’s garment and textile exports to the US and EU are subject to an average taxation of 17% and nearly 10% respectively. If nothing changes, it is not until mid-2018 that the roadmap of tax reduction under TPP and EVFTA will take effect, which will therefore bring about a lot of disadvantages for Vietnamese enterprises in the process of competition with international opponents. Furthermore, China, India and Bangladesh, who are on the “upper floor” compared to Vietnam in the global supply chain, are also implementing a number of active measures aiming to compensate for the downsides caused by their TPP non-membership, driving competition to new heights. Unless effective solutions are taken soon, Vietnam will surely become an “underdog” on the world market. Several FTAs have already been negotiated but are yet to define their validity date, so export activities will see fewer considerable fluctuations. Importers have been looking to manufacturers located in countries with tax and cost advantages. Therefore, Vietnam’s garment and textile exports revenues are expected to reach only US$29.5-30 billion in 2016, lower than the country’s envisaged goal for the year. In order to overcome difficulties, local enterprises must not stand still but take drastic measures to change the situation as well as be well-prepared to seize opportunities as soon as the TPP comes into effect. It is necessary for Vietnamese businesses to strengthen venture, links and investment in a chain; apply modern equipment and machines; and improve the quality of labourers aiming to diversify products to meet the demand for new products and enhance productivity. Besides, state management agencies should also make relevant and timely policy adjustments in terms of transportation costs, unofficial customs costs, tax and administrative procedures, as well as favourable conditions regarding capital, planning and transport infrastructure, aiming to facilitate enterprises to grow and firmly move towards the “larger sea”. Hong Kong businesses look to invest in Binh Duong A delegation of representatives from dozens of Hong Kong companies made a field trip to the southern province of Binh Duong on June 25 to learn about the local investment climate. According to Hong Kong Trade Development Council (HKTDC) Executive Director Margaret Fong, Hong Kong has so far invested more than one million USD in 82 projects in Binh Duong, mostly in the sectors of garment-textile, woodwork and plastic bag production. Vietnam’s signing of the Trans-Pacific Partnership has opened up opportunities for investors, while Hong Kong is working to secure trade agreements with ASEAN member states. In other words, HKTDC considers Vietnam a priority market. She hailed Binh Duong for its marked socio-economic achievements over the past time, saying they serve foundations for Hong Kong firms to invest in the locality. Tran Thanh Liem, Chairman of the provincial People’s Committee, said local authorities are committed to building a favourable and safe business climate for investors. Binh Duong is expected to become a centrally-run city by 2020, with 10,000 hectares of industrial and urban land zoned off in preparation for the future landing of investors. The province has attracted 25 billion USD in foreign investment so far. It contributed 21 billion USD to the country’s export revenue last year. Over 62 trillion VND needed to build power grids in the south The Southern Power Corporation of the Electricity of Vietnam (EVN) needs over 62 trillion VND (2.79 billion USD) to carry out nine power transmission projects in the southern region and fulfil its rural electrification targets in 2016-2020. Speaking at a conference in the Mekong Delta city of Can Tho on June 24, Deputy Director of the corporation Nguyen Phuoc Duc said the money will be sourced from the State budget, official development assistance (ODA) loans, domestic commercial lending, domestic preferential loans and advances from customers. The projects include one to provide electricity to over 6,100 ethnic Khmer households in the Mekong Delta province of Kien Giang, and another using loans from the German Development Bank to reduce emissions in energy supply. It will also build a 110kV power line (152km) and a dozen of 110kV transformer stations, as well as carry out the third phase of a World Bank-funded project to support the development of electricity reform policy. One project using loans from the Japan International Cooperation Agency (JICA) will build medium and low voltage lines. Other schemes involve upgrades to the power distribution network in small- and medium-sized cities across 21 southern localities, especially building and reinforcing the 110kV power grids, and upgrading and expanding medium and low voltage grids. More than 5,800 km of medium voltage line along with over 9,000 km of low voltage line and nearly 511,000 MVA transformer stations will be constructed. A project will be carried out to provide electricity for the island communes of Hon Thom and Son Hai, and Phu Quoc island district in Kien Giang province. Additionally, the Southern Power Corporation will develop the power grid in remote and mountainous areas to meet the target on rural households’ access to electricity by 2020. The company strives to supply efficient electricity for 21 cities and provinces in the south during 2016 and the following years, while ensuring an average power growth of 10.5-12 percent per year and a reduction in power cuts by 2020. Close to 49.4 billion kWh of commercial electricity were supplied to 21 southern cities and provinces in 2015, a year-on-year increase of 10.74 percent. In the first five months of this year, nearly 22 billion kWh of electricity were supplied, representing a yearly rise of 13.31 percent. To ensure supply, the corporation invested over 18 trillion VND (810 million USD) to build power grids in the south between 2011-2015. Raising productivity crucial for stronger competitiveness A critical solution to promote businesses’ competitiveness is to improve labour productivity which is still a weakness of Vietnamese enterprises, an official of the Ministry of Finance said at a workshop on June 24. The average productivity of each Vietnamese worker has increased by nearly 24 percent from 2010, but it is still lower than that in neighbouring countries, Dang Quyet Tien, Deputy Director General of the ministry’s Department of Corporate Finance, quoted the General Statistics Office’s data. Each Vietnamese worker had a productivity equivalent to 79.3 million VND (3,660 USD) in 2015. The average productivity rose by 3.9 percent annually between 2006 and 2015. The 23.6 percent increase from 2010 is lower than the targeted 29 – 32 percent, according to the statistics office. Nguyen Anh Tuan, Director of the Vietnam National Productivity Institute, said labour productivity in Vietnam has grown strongly in recent years, especially in the industry and construction sector. However, productivity in the agro-forestry-fishery sector is equivalent to only one-fourth in industry and construction, and over one-third in the services sector. That has partly affected the overall productivity of the society, he added. Nguyen Thi Tue Anh, Deputy Director of the Central Institute for Economic Management, said a healthy competitive environment is a necessary condition, and manpower quality is a foundation for higher labour productivity. A rigid institutional system will impede productivity augmentation, while a flexible one will give an impetus to productivity growth, she noted. Deputy PM urges reducing coal production cost Deputy Prime Minister Trinh Dinh Dung has required the Vietnam National Coal-Mineral Industries Holding Corporation (Vinacomin) to reduce coal production cost for long-term development, contributing to national energy security. Dung made the demand at his meeting with Vinacomin leadership in the coal-mining Quang Ninh province on June 25. While acknowledging Vinacomin’s success in increasing output, meeting domestic demand for coal and ensuring jobs for more than 100,000 workers, the Deputy PM said the corporation must improve productivity, cut prices and pay more attention to environmental protection, thus enhancing its competitiveness. He asked the group to make survey on natural resources to serve the drafting of development plans for key minerals, first of all coal. The Deputy PM instructed relevant ministries, agencies and Quang Ninh province authorities to study Vinacomin’s petitions and suggestions and timely remove obstacles for the corporation. He also asked Quang Ninh province to tighten the management of coal mining and trading activities alongside environmental protection measures. Work begins on first luxurious five-star resort in north central A ground-breaking ceremony for the north central region’s first five-star complex of hotel, entertainment and resort was held in Cua Lo town, the central province of Nghe An on June 26. Invested by Vingroup, Vietnam’s leading real estate developer, the 39-hectare Vinpearl Cua Hoi project has total investment capital of more than 900 billion VND (40.6 million USD), including high-end resort villas, five-star hotel, restaurants, and other facilities. It is located at Cua Hoi beach, 15 kilometres from Vinh city. Speaking at the ceremony, Chairman of the provincial People’s Committee Nguyen Xuan Duong said that the project is significant to the provincial development. Upon completion, the international standard complex will mark a giant stride in the local tourism sector, he noted, adding that the province commits to creating favourable conditions for the investors to effectively implement the project. Vingroup also launched construction of the 16-hectare Cua Sot villa complex in Loc Ha district, Ha Tinh province on the same day. The two top-notch complexes are expected to mark a major advance in the regional tourism. Also on June 26, the provincial People’s Committees of Nghe An and Ha Tinh started works on Cua Hoi bridge across Lam river, connecting Cua Lo resort town (Nghe An province) and Nghi Xuan district (Ha Tinh province). The 1 trillion VND (45.1 million USD) bridge on the approved route along the central coast line will facilitate socio-economic development and consolidate security defence in the two provinces and the north central region. Conference seeks ways to build trademarks for farm produce The building of trademarks for farm produce are crucial to boost the sales of Vietnamese agricultural products in foreign markets, heard a conference in the Mekong Delta province of Ben Tre on June 23-24. According to Prof. Dr. Vo Tong Xuan, Rector of the Southern Can Tho University, the re-arrangement of agricultural production is necessary as Vietnam has signed bilateral and multilateral agreements with various international partners. Besides improving the products’ quality to meet world standards, Vietnam should also build strong trademarks that affirm prestige for local products, he stressed. Nguyen Thi Hong Thu, Director of the Ben Tre-based Chanh Thu fruit export company, although the firm has successfully exported rambutan to the US, it has faced obstacles in building a “Ben Tre rambutan” trademark. She attributed the difficulties to small-scale production of local farmers as well as their different production techniques and experience, which lead to a difference in quality of rambutan. It is hard for the company to reach large orders with foreign partners, she said. Currently, Ben Tre has made a plan to build a trademark for seven local products – coconut, green-skin grapefruit, rambutan, ornamental flower, beef, pork and sea shrimp. Participants at the event expressed delight that lychee from the northern provinces of Bac Giang and Hai Duong and dragon fruit from the central province of Binh Thuan have reached Australian and US markets, while Cat Chu mangos are sold in Japan. However, Vietnam’s rice has yet to get its trademark, they regretted. VEA to focus on renewable energy planning by 2021 The Vietnam Energy Association (VEA) will focus on evaluating the potential of different energy sources in Vietnam and developing a strategy for investment in new and renewable energy between now and 2021. VEA President Tran Viet Ngai made the statement at the association’s third national congress for the term 2016-2020 held in Hanoi on June 24. The association plans to propose to the government increasing the application of advanced technology to explore crude oil and natural gas at a depth of less than 1,000 metres in the East Sea and on the continental shelf of Vietnam, he said. It will work closer with its members, such as the Vietnam Oil and Gas Group (PVN), the Vietnam Coal and Minerals Industries Corporation (Vinacomin), and the Electricity of Vietnam (EVN) Group, in preparation for new power projects. During the term from 2010-2015, the VEA was involved in designing policies for the infrastructure development of the energy industry, promoted the use of made-in-Vietnam mechanical products and services in many electricity projects, and put forward strategic solutions for the economical and effective use of energy. It has also conducted analysis on the financial issues of power projects and helped them identify barriers to funding access so that proposals for support were sent to the government and related agencies. At the congress, the association and its members were presented with the State’s Labour Order and the Ministry of Industry and Trade’s certificate of merit in recognition for their works. Tran Viet Ngai was re-elected as the association’s president. Foreign direct investment - an economic highlight in first half of 2016 FDI continued to be a highlight for Vietnam’s economy in the first half of the year, with 907 new FDI projects licensed as of late May, totalling nearly US$7.6 billion, up 53.2% in the number of projects, and 155.9% in registered capital compared to the same period of 2015. If counting the 425 projects registering to increase supplementary capital, the total registered FDI capital exceeded the US$10 billion threshold, a year-on-year increase of 136.4%. FDI disbursement in the first five months reached about US$5.8 billion, representing a surge of 17.2% against the previous year. Thus, the FDI sector continued to lead the pace of increasing investment capital in comparison with the State economic sector and the non-State sector, accounting for a record 28% of the total investment in the entire society, which is equivalent to over 32% of gross domestic product (GDP). As the investment sources from both the State and non-State economic sectors remain limited and difficult, the investment resources from the FDI division have contributed significantly to realising the economic growth target as well as shifting the economic structure towards modernisation. The manufacturing industry remained the largest FDI recipient in the five months with registered capital of over US$6.6 billion, making up 65.1% of the total registered figure. Notably, the information and communication industry climbed to second place attracting US$1.3 billion, while the real estate sector dropped to third position with US$542.8 million, representing 5.4% of the total registered FDI capital. Big cities and provinces, which lead the industrialisation pace, continued to be the major attractors of FDI capital in the period. Hanoi occupied the top place receiving registered FDI capital of over US$1.86 billion, equal to 24.6% of the total newly-registered capital, followed by Haiphong with over US$1.6 billion (21.3%), Binh Duong with US$570.2 million (7.5%), Ho Chi Minh City with US$488.6 million (6.5%), Bac Ninh with US$330.1 million (4.4%), Dong Nai with US$289.7 million (3.8%) and Tien Giang with US$259.7 million (3.4%). There were few changes on the list of leading FDI investors in Vietnam. The Republic of Korea remained the largest investor from January to May at nearly US$2.9 billion, accounting for 38.2% of the total newly-registered capital, followed by Luxemburg, Singapore, Chinese Taipei and Japan. The trend of opening the door, promoting international integration and improving the business environment continues to make Vietnam an attractive investment destination to foreign investors. The number of projects as well as the FDI capital scale continue to rise sharply, showing the increasingly significant role and contributions made by the FDI sector to Vietnam’s economy. However, there has yet to be many changes in the quality of FDI attraction and use as the FDI capital structure has yet to see remarkable shifts in terms of sectors, fields, attraction localities and investors. The FDI sector’s contributions to Vietnam’s economic growth and economic structural shift will be much higher if the surge in quantity is associated with the improvements in quality. Vietnam’s Vingroup debuts greenhouse veggies Vietnamese conglomerate Vingroup’s subsidiary has introduced its own greenhouse produce, including baby veggies and other hydroponic greens. VinEco Company of Vingroup JSC put greenhouse vegetables up for sale on June 23, exclusively in the supermarket chains of Vinmart and Vinmart+ in northern Vietnam. Grown with Israeli technology in the northern province of Vinh Phuc, the vegetables are as diverse as 20 kinds of baby veggies, namely baby broccoli, mizuna, mustard plants, kale, watercress, and more. Additionally, VinEco also offers 12 kinds of hydroponic vegetables, including red-brown Batavia lettuce, romaine, and others. The veggie supplier said that the greens are planted in greenhouse systems to keep pests at bay instead of using pesticides, and that the production is self-contained. By the end of 2016, VinEco will have installed 55 hectares of greenhouse and 120 hectares of row covers to cultivate the vegetables in the northern region, the southern area, and the Central Highlands province of Lam Dong. Aeon Mall Binh Tan set to welcome customers The Aeon Co. and the Aeon Mall Co. will open Aeon Mall Binh Tan on July 1 - their fourth shopping mall in Vietnam and the third in Ho Chi Minh City and the nearby area. The mall is about 10 km southwest of the city center, within the International Hi-Tech Healthcare Park in Binh Tan district. With its convenient access the mall is expected to attract customers from the city and surrounding areas. Developed under a concept of being a “New Sensation Entertainment Mall”, it will target young people and families filled with curiosity and a willingness to spend. The mall will offer “New Discoveries”, “New Experiences”, and “New Lifestyles”. Each floor of the mall offers a diverse dining zone with a wide selection of restaurants, from popular local beer restaurants with open terrace seating to a dining area modeled after Hoi An ancient town, a world heritage site in central Vietnam. In response to consumer demand for high quality and highly functional Japanese goods, the mall offers an abundant selection of products from Japan to meet their needs. It will strive to improve convenience in the shopping experience through simple and clear product displays along with “Touch & Try” corners where customers can test products before purchase. The mall is the first of Aeon in Vietnam to use solar power. Based on the Aeon ECO project unveiled in September 2012, the shopping will mall implement three core strategies reducing energy consumption, generating renewable energies, and providing social infrastructure to protect the life of local communities. With these strategies, the mall aims to become a leading “ECO Store” in the ASEAN region. Inflation again a worry The consumer price index has been increasing for the last five months. Following a 1.89 per cent year-on-year rise in April, it rose by 2.28 per cent in May, the highest rate since November 2014. Prices of most goods and services in the basket making up the index have been rising. Food was up by 2.36 per cent, beverages and tobacco by 2.37 per cent, garments by 2.31 per cent, housing and construction by 1.67 per cent, medicines by 26.8 per cent, education by 4.55 per cent, culture and entertainment by 1.57 per cent, and other goods and services by 2.23 per cent. Only transport (9.76 percent) and post and telecom (0.58 percent) prices declined. The inflation rate is likely to be sharply up in the remaining seven months of the year. It averaged 6.73 percent in the two decades from 1996 to 2016, reaching an all-time high of 28.24 percent in August 2008 and a low of -2.60 percent in July 2000. Analysts listed the most likely causes of inflation: The cost of healthcare is set to be adjusted upward in July; global fuel prices are creeping up again and are likely to have a knock-on effect on the prices of many other items, including consumer goods. The global fuel price has increased by 60 per cent in the last two months to US$50 per barrel and is expected to keep rising. A food shortage due to the prolonged drought and pollution could create pressure on the prices of food and beverages. The high budget deficit is another contributing factor. According to the Ministry of Planning and Investment, in the first five months of the year the budget deficit reached VNĐ66.4 trillion (US$2.95 billion) and the figure is estimated to top VNĐ254 trillion by year-end. The strong credit growth is another major inflationary factor. Credit has grown by 5.48 per cent this year, the highest in the last few years, according to the State Bank of Viet Nam’s Credit Department. Year-on-year the growth has been 17.59 per cent. The trend is expected to continue especially after the central bank issues Circulars No.6 and No.7 that are likely to loosen monetary policy. Đồng Nai rambutan protected The National Office of Intellectual Property has granted protection under geographical indication for Long Khánh rambutan, which is grown in the southeastern province of Đồng Nai. The designation was given to nhãn and tróc rambutan grown, preserved and packaged in Long Khánh Town, Xuân Lộc, Thống Nhất and Cẩm Mỹ districts. Nhãn rambutans, which are smaller than other varieties, are considered to have the best taste among rambutan varieties.   Tróc rambutan has a red or dark red peel, long hairs and a sweet taste. The flesh does not stick tightly to the seed and can be eaten easily. Geography, climate and soil have created the specific quality of Long Khánh rambutan compared to rambutan grown in other areas, according to the National Office of Intellectual Property. The provincial People’s Committee will manage the geographical indication protection.     Rambutan is the province’s second fruit granted geographical indication protection, after Tân Triều grapefruit. Đồng Nai has more than 11,000 ha of rambutan grown mostly in Long Khánh Town, Xuân Lộc, Thống Nhất and Cẩm Mỹ districts. More than 6,700ha of rambutan in these areas are under geographical indication protection. Long Khánh Town has about 2,800ha of rambutan. Many areas have used advanced farming techniques to improve yield and quality. Trần Mộng Thành, deputy chairman of the Long Khánh Town People’s Committee, said: “The town has helped farmers establish a model of growing rambutan under Vietnamese Good Agricultural Practices (VietGAP) standards in Bình Lộc Commune.” The model is now used by other farmers. “We are strengthening the link between companies and farmers to guarantee stable rambutan outlets,” he said. Đoàn Quốc Sang, who grows rambutan in Xuân Lộc District, said Đồng Nai rambutan was delicious and well-known in the domestic market, but the outlets were unstable. “We hope the geographical indication protection will result in better prices and stable outlets,” he said. The province’s rambutan orchards are now in peak harvest season, with an average output of nearly 20 tonnes per ha, lower than the previous harvest. Orchard owners attributed the lower yield to the impact of prolonged drought in the dry season. This year rambutan was harvested about one month later than in other years. Đồng Nai rambutan is exported to several countries, including Japan and France. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR