BUSINESS IN BRIEF 12/8 Ba Ria Vung Tau calls for investment in four key areas   The southeastern province of Ba Ria – Vung Tau on August 10 organised a conference in HCM City calling for investment in four major areas.  Those four areas are hi-tech industrial projects with high added value, energy saving, environmentally friendly and highly competitive products; seaport logistics for Cai Mep – Thi Vai international transit port; high-quality tourism projects focusing on sea resort tourism, Meetings, Incentives, Conferences, and Events ( MICE ) tourism, high-quality ecotourism and spiritual tourism; hi-tech agricultural projects with processing facilities and agricultural mechanics.  The provincial authorities said the province would implement many incentive policies to encourage investment, simplify administrative procedures by implementing a “one stop shop” mechanism, improve infrastructure.  Nguyen Van Binh, Head of the Party Central Committee’s Economic Commission, urged the province to build breakthrough policies to develop industry, seaports, seaport logistics and tourism and boost linkages with provinces in the southern key economic zone.  Meanwhile, Deputy Prime Minister Trinh Dinh Dung said the province needs to further improve business and investment environment, perfect referential mechanisms and policies as well as create favourable conditions for investors.  On the occasion, the province signed four memorandums of understanding (MoU) in the fields of seaport infrastructure, transport and tourism with a total of 50 trillion VND (2.24 billion USD). State units divest 2.87 trillion VND in seven months As many as 43 State-owned enterprises (SoEs), including six corporations, were cleared for equitisation in the first seven months of this year, according to the Finance Ministry on August 10. State units divested 2.87 trillion VND (130.4 million USD) in book value and earned 5.632 trillion VND (256 million USD) from selling stocks. State-owned groups and corporations raked in 424 billion USD from selling stakes in five sensitive areas, including securities, insurance, banking-finance, real estate and investment funds, not to mention 1.959 trillion VND (89 million USD) from other fields. In July, the State budget revenue was estimated at 102 trillion VND, up 26.6 percent from the previous month. The figure for January-July reached 583.6 trillion VND, up 5.7 percent from the same period of 2015. The total budget spending hit 107.5 trillion VND, raising the seven-month figure to 662.1 trillion VND, marking a 4.9 percent increase year-on-year. Also in July, four loan agreements worth 669 million USD were signed with the World Bank (WB). On a seven-month calculation, 26 loan deals valued at 4.431 billion USD were inked, mostly with the WB, the Asian Development Bank and Japan. Approximately 150 million USD were disbursed. In the remaining months of this year, the ministry will strengthen inspection on tax payment and customs clearance while asking relevant units to monitor the SoEs restructuring, securities market, pricing and public asset management. Vietfood & Beverage - ProPack exhibition 2016 draws 420 firms The Vietfood & Beverage - ProPack international exhibition opened at the Saigon Exhibition and Convention Centre in Ho Chi Minh City on August 10 with the participation of 420 enterprises from 20 countries and territories worldwide.  As many as 500 booths at the event are displaying a wide range of products with many of Vietnam’s strength such as tea, coffee, fresh and packed seafood, vegetables, fruit, and confectionary.  Vietnam has the largest number of firms attending the event, including big names such as Saigon Beer, Ha Noi Beer, Vifon, Vissan and Duy Tan Plastics, followed by China with 46 enterprises, the Republic of Korea with 30 firms, Taiwan (China), 23 and Poland, 10.  Opening the event, Ho Thi Kim Thoa, Deputy Minister of Industry and Trade, said that the annual event, which was first held in 1996, has become a meeting venue for domestic and international businesses to exchange information and seek partnerships, thus boosting the growth of Vietnam ’s food and beverage and packing industries.  She also suggested that food and beverage firms pay more attention to the packing industry to meet customers’ higher demands in tracing food origins.  In 2015, the beverage sector contributed 34.5 trillion VND (15.6 million USD) to the State budget and created jobs for more than 500,000 laborers.  According to Nguyen Van Viet, President of the Vietnam Beer, Alcohol and Beverage Association, a number of conferences will be held in the framework of the four-day exhibition, aiming to seek ways to boost the sector’s growth. Vietnamese firms to showcase products in Japan Vietnamese businesses will have a chance to display their products at Vietnam Fair in Japan's largest eco-friendly shopping centre - AEON Lake Town Saitama - on September 2-4, baodautu.vn reports.  Vietnamese goods will be showcased at 20 booths and will include garments and textiles, footwear, farm produce, food and home furniture.  During the event, Vietnamese firms will also meet AEON's wholesale importers and other Japanesde businesses while studying the distribution network in Tokyo.  Co-organised by the Ministry of Industry and Trade, the Vietnamese Embassy in Japan and AEON Group, the forthcoming event is part of the Government's plan to help Vietnamese businesses participate in foreign distribution networks between now and 2020.  Previously, the ministry joined hands with foreign retailers to organise trips for Vietnamese businesses to join Vietnamese goods weeks in France, Italy, the Republic of Korea and Thailand.- Deposit insurance should be part of bank restructuring: Deputy PM The Law on Deposit Insurance should be amended to give the Deposit Insurance of Vietnam (DIV), a non-profit State financial organisation, more independence in managing risk at credit institutions.  Deputy Prime Minister Vuong Dinh Hue and many insiders expressed this view at a working session with the DIV in Hanoi on August 10.  By the end of May, the DIV monitored more than 3,000 trillion VND (134.5 billion USD) worth of deposits at 1,252 deposit services providers, including 92 commercial and cooperative banks, 1,156 people’s credit funds, and three micro-financial organisations, according to Chairman of the DIV board of directors Nguyen Quang Huy.  Its total capital was at 30.68 trillion VND (1.37 billion USD), including 5 trillion VND (224.2 million USD) of charter capital. More than 99 percent of the idle capital was invested in Government bonds.  The DIV has so far compensated 1,793 people who saved money at 39 dissolved credit funds.  Deputy Finance Minister Tran Van Hieu said the DIV was initially tasked with dealing with bankrupted credit funds. Its total asset value now exceeds 30 trillion VND, so the DIV should take on more responsibilities. Deputy PM Hue said the DIV is an important institution, but it hasn’t engaged in the restructuring of the banking and credit systems. At present, it is only able to pay compensation for small credit organisations that go bankrupt.  He told the DIV to clarify its role in bank restructuring and bad debt settlement in the development strategy.  Within the next two months, international organisations will submit an official consultation plan to the Vietnamese Government, in which they will suggest revisions to the Law on Deposit Insurance so that the DIV can actively take part in bank restructuring, he added. Alphanam's Luxury Apartment to handover to buyers in Q4 2017 Luxury Apartment, part of Four Points by Sheraton developed by the Alphanam Real Estate JSC in Da Nang is expected to hand over apartments in the fourth quarter of 2017. According to information released by Alphanam on August 9, Luxury Apartment, construction of which kicked off in July 2015, has completed construction of the 29th floor and is now building the 30th floor. Situated in the prime location of Vo Nguyen Giap Street in the central city, Luxury Apartment is within a high-end complex that also includes Four Points by Sheraton Hotel, managed by Starwood Capital. Providing 232 one- and two-bedroom apartments ranging in size from 60 sq m to 100 sq m, Luxury Apartment boasts spectacular views towards Son Tra Peninsula. The complex includes modern amenities such as an infinity swimming pool, top-quality rooftop restaurants, and a fitness centre. One of Vietnam’s traditional holiday destinations, Da Nang saw a second home market emerge in the early 2000s followed by a slowdown from 2010 to 2015. Since the end of last year, however, the city has seen a surge in new products being launched and sold, according to insiders. Da Nang’s apartment stock remained unchanged quarter-on-quarter in the second quarter but was up 7.4 per cent year-on-year with 12 projects providing 575 units to the primary market. Son Tra district was the largest supplier, with a 58 per cent market share, followed by Hai Chau with 39 per cent. The lowest primary apartment price was recorded in Hai Chau district (VND15 million ($672.7) per sq m) while the highest was in Ngu Hanh Son district (VND69 million ($3,094) per sq m). “Developer reputation, construction progress and proximity to the beach were key factors among the best performing projects this quarter,” a Savills Vietnam report noted. “Guaranteed returns have been widely offered in many projects’ pre-sales programs.” Alphanam Real Estate JSC is a subsidiary of the Alphanam Group, a major Vietnamese corporation with 20 years of operations and development. The group is involved in a host of different business sectors, including real estate, construction and engineering. In real estate it has developed notable projects such as the King Palace residential complex in Hanoi’s Thanh Xuan district and Golden City in An Giang province’s Long Xuyen city in the Mekong Delta. Power firm shuns electricity system costs at realty projects HCMC Power Corporation has said electricity generation and selling prices would shoot up if the power sector is required to cover costs of power supply systems installed by housing development projects. The corporation’s deputy general director Pham Quoc Bao made this point after a meeting with the HCMC Real Estate Association (HoREA) held on August 9. Some property firms have asked the power company to cover power supply system costs so that they could lower prices for home buyers. At the meeting, HoREA proposed the power company repay the amount spent on power supply systems to developers of mid-end commercial housing projects. HoREA cited the 2004 electricity law and the law that revised some articles of the electricity law in 2012 as saying those units generating, transmitting and distributing electricity are responsible for setting up networks to sell electricity.  So far, property developers have had to spend on electricity supply networks and water pipelines in and around their project sites and then transferred them to power and water companies for management without any reimbursements. They have had no other choice but to factor those costs into house selling prices. Electricity distribution systems at commercial housing projects account for 1-2% of total investment capital, Bao said. According to Bao, the company cannot bear those costs if houses at commercial projects are sold at high prices and few buyers move in. A HCMC-based lawyer cited the 2014 law on real estate business as saying that a house or a building is only transferred to clients once it and related infrastructure facilities have been completed on schedule and are connected with public infrastructure works. As specified in the 2014 law on construction, technical infrastructure includes transport, communications, energy, public lighting, water supply, and waste collection and treatment facilities. So, property developers are responsible for developing technical infrastructure including electricity systems. Poultry imports from EU surge The import of poultry from the European Union (EU) has been on the rise in both volume and value in recent years, heard a workshop held by the EU and Poland’s National Poultry Council in Ho Chi Minh City on August 9.  Mariusz Boguszewski, Economic Attaché at the Polish Embassy in Vietnam, stated that Europe is implementing a series of activities of a programme to promote poultry products with the Quality Assurance for Food Products (QAFP) certificate in the Vietnamese market.  Therefore, the workshop offered a chance for representatives from the European Commission, the embassy, and Vietnam’s poultry importers to meet and exchange information to boost import and export of this kind of product, he said.  According to the European Commission, Vietnam’s poultry import turnover from the EU spiraled from 7.36 million EUR in 2013 to 15.7 million EUR in 2014 and 23.3 million EUR in 2015, up 113.15 percent and 48.22 percent year-on-year, respectively.  EU experts predict that in 2021, Vietnam’s poultry consumption will rise by 37 percent, in which domestic production will increase by 27 percent and import up 49 percent.  With a population of over 90 million, Vietnam is considered a potential market for high-quality poultry products from the EU.  Per capita consumption of poultry in Vietnam rose from 4.26kg per person a year in 2002 to 7.6kg per person a year in 2012. Myanmar guests learn from Ha Nam’s experience A delegation from Myanmar led by Aung Naing Oo, Director General of the Directorate of Investment and Company Administration (DICA) under the Ministry of National Planning and Finance made a working visit to the northern province of Ha Nam on August 9. The visit aims to learn from the Vietnamese locality’s experience in investment attraction, socio-economic development, land and tax management, and land clearance. Vice Chairman of the provincial People’s Committee Vu Dai Thang briefed the guests on Ha Nam’s prominent achievements in luring investment and promoting socio-economic development, while sharing experience in achieving them. In 2011-2015 period, the province’s average economic growth reached over 13 percent per year. The per capita income hit over 42 million VND per year in 2015, while the rate of poor households fell to 3.9 percent. In recent years, Ha Nam has always been among the country’s top ten localities in investment attraction. The locality is now home to 580 investment projects worth 4.8 billion USD, including 172 foreign-invested projects with a total capital of over 1.4 billion USD. In the first six months of the year, the province lured 41 projects, including 18 FDI ones, According to Thang, to achieve these outcomes, the local authorities have mobilised all resources to invest in developing technical infrastructure and improving the efficiency of industrial parks and clusters. The province has focused on fine-tuning mechanisms and regulations to attract investment in support industry, processing and manufacturing, with priority given to products that use advanced, energy-saving and environmentally friendly technologies, he said. It has also fostered agricultural industrialisation, towards creating breakthroughs in agriculture production, boosting rapid and sustainable agricultural development, and accelerating agricultural restructuring, he added. For his part, Aung Naing Oo spoke highly of Ha Nam’s achievements in investment attraction and economic development, saying that his country is hastening reform in some economic fields, including investment promotion. Ha Nam’s experience will be useful for Myanmar to realise its socio-economic development targets, he said. Insurance ensures social welfare Vietnam’s insurance market plays an important role in socio-economic development, thus implementing social welfare policies, particularly in agriculture, fisheries, and human lives, said an official from the Ministry of Finance.  Nguyen Quang Huyen, Deputy Head of the Ministry’s Insurance Management and Supervision Department made the remark at a press briefing in Hanoi on August 8.  Huyen lauded the contributions of the insurance sector to development, saying that it helped improve the business climate, carry out policies on macro-economic stability and ensure social welfare system.  As of June 30, the total insurance value of 28 coastal provinces and cities was 37.42 trillion VND (1.67 billion USD).  Total premiums in the period reached 387 billion VND (17.27 million USD), covering 14,977 fishing vessels and 145,960 crew, according to Huyen.  The enterprises providing insurance services for offshore-fishing vessels were Bao Viet Insurance, Bao Minh JSC., Petrolimex and PVI Insurance. Food export benefits little from Trans-Pacific Partnership Vietnam’s food exports will benefit little from the Trans-Pacific Partnership (TPP), according to experts.  Food imports, however, will increase strongly, they said at a food processing industry workshop held by the HCM City Department of Trade and Industry in collaboration with the Food and Foodstuff Association (FFA) of HCM City on August 8.  Vietnam has a trade surplus of 3.3 billion USD in food trade with countries in the TPP because of low tariffs on seafood and coffee, Vietnam’s major exports.  They agreed that when the TPP takes effect, rice, vegetables and fruits will benefit but revenue from these commodities are low.  Also, most enterprises in the food industry are small and medium-sized and are limited in terms of capital and technology. They have also been slow to learn about the TPP, so most will not be able to take advantage of the agreement.  According to Dr. Duong Nhu Hung, Vice Rector of the HCM City Economy-Law University, the TPP will open up markets, increasing competition in terms of scale and brand, making it harder for Vietnamese companies, who must compete with big international names.  Ly Kim Chi, Chairman of the FFA, said Vietnamese enterprises need to be more proactive in preparing for development and integration when the TPP takes effect. Standard Chartered anticipates Vietnam’s economic growth at 6 percent The UK’s Standard Chartered Bank anticipates Vietnam’s economic growth will be 6 percent in 2016 and 6.6 percent in 2017, Saigon Giai Phong (Liberated Saigon) newspaper reported.  According to the bank’s latest Global Research, manufacturing and construction are likely to remain the sectors driving growth, despite poor performance in agriculture. The report acknowledged that in the context of a gloomy world economic outlook, Vietnam is one of few attractive investment destinations for foreign investors and expected foreign direct investment to continue to flow into the country in the last half of 2016. However, the report reckoned that the country’s inflation in the remaining months of this year will increase by 2.6 percent due to greater spending. Regarding exchange rates, the bank recognised that VND has continued to demonstrate resilience, despite broader market volatility post-Brexit and the VND/USD exchange rate is expected to remain steady at about 22,400 VND per USD.- Work begins on Dung Quat Industrial Town project Construction kicked off on the Dung Quat Industrial Town project in the central province of Quang Ngai on August 10. The project, spanning 1,303ha in Binh Son District, will be divided into two phases. The first phase is funded by the Hoang Thinh Dat Joint Stock Company, with total capital of more than VND2 trillion (US$89.5 million). It will focus on building the infrastructure for the industrial park, across 319ha, including a wastewater treatment station with a capacity of 25,000cu.m. per day. It is expected to be completed in 2019. The project is to operate for 50 years. According to the current regulations, the project will enjoy duty exemptions on goods imported to create fixed assets. It will also be exempted from paying land and water surface rents. The project aims to attract businesses in the areas of production and assembling of electrical, electronics and telecommunication devices; production of auto and plane components and parts; food and drinks; chemical, medicines and pharmacy; textile, garments and dying; and other light industries and parts supplies.  Hoa Sen switches to property to leverage steel, pipe capabilities Property will become the key business of Hoa Sen Group (HSG) in the next five years, the company's chairman, Le Phuoc Vu, has revealed. At a meeting in HCM City on August 10 to announce an architectural design contest to be held by his company, he said the steel giant would start to invest in real estate from this year. He explained the reason for the switch: "Property is a big market with huge potential thanks to the high population and expanding economy. We are a big producer in Viet Nam of steel, plastic pipes as well as cement." Thanks to that, it can source construction materials for its property projects internally, he said. "We are developing step by step and I think it is sustainable." HSG's baby steps in the property market have been in the form of investments in tourism projects. In May it began construction of the Hoa Sen Hotel in the northern province of Yen Bai. The second project will be a luxury complex with a shopping mall, hotels and apartments in Quy Nhon city in the south-central province of Binh Dinh. Hoa Sen Tower, expected to help boost tourism in the province, will have two buildings and an estimated 500-odd hotel rooms and over 1,800 apartments. Vu said he saw potential in Binh Dinh since the number of visitors there is increasing by 70 per cent a year. To meet international standards, the company launched a design contest for seven famous architecture companies. Vũ did not reveal the budgeted cost of the project, merely saying instead that "with estimated revenues of VND20 trillion (US$909 million) next year, our cash flows are strong enough for this big project." The company would continue to invest in other projects like a spiritual tourism complex in Van Hoi Lagoon in the northern province of Yen Bai and a resort in Binh Dinh province, Vũ added. Explaining the reasons for choosing Binh Dinh and Yen Bai, Vu said for now the company focused on provinces where there is not much competition. Hoa Sen, one of the biggest steel makers in Southeast Asia, has, after 15 years, 40 per cent of the Vietnamese steel market and 20 per cent of the plastic pipe market. It exports its products to 65 nations and territories. Hoa Sen had once invested in the apartment market in HCM City, but pulled out following the 2008 slump.  FMCG growth hits record high in six key cities Growth in fast-moving consumer goods (FMCG) in six key cities in Vietnam hit a three-year high in the second quarter of 6.3 per cent after coming in at just 3.6 per cent in the first quarter, according to Nielsen’s Market Pulse report released on August 10. The six key cities - Hanoi, Ho Chi Minh City, Hai Phong, Can Tho, Nha Trang and Da Nang - saw strong momentum in FMCG growth in the quarter, mainly driven by an increase of 5.2 per cent in volume growth. The recovery is reflected in growth across most categories, such as food, with 4.7 per cent, milk-based products 4 per cent, and home care 4.6 per cent.. Beverages (including beer) continued to be the biggest category, contributing 41 per cent of total FMCG sales and growing a healthy 9.2 per cent, led by an increase of 6.9 per cent in volume growth. Rural areas continue to be a new source of growth for many manufacturers, with a 7.6 per cent increase over the long term (the last 12 months) but slowing slightly in the second quarter, at 5.6 per cent. Urban areas, meanwhile, witnessed a stronger bounce back in the second quarter, with 6.3 per cent growth. The good news is that the pick up in both rural and urban areas are mostly driven by volume increases. Rural areas present many opportunities to businesses. Mr. Nguyen Anh Dung, Director of Retail Measurement Services at Nielsen, said that Vietnam’s rural community accounts for 68 percent of the country’s 92 million people and half of all FMCG sales. “Rural inhabitants are now investing in education and have enjoyed income growth of around 44 per cent over the last three years,” he added. “But this potential remains largely unknown to many businesses.” Despite the potential, expanding into rural areas in Vietnam also poses many challenges, in particular the high cost of serving geographically dispersed districts. “In India and China and now Vietnam it is more important for manufacturers to be able to prioritize their rural expansion efforts,” he said. “Some parts of rural areas offer better prospects than others, so identifying these becomes very important to ensure maximum return on investment.” When it comes to purchase drivers among rural consumers, in addition to valuing the opinions and recommendations of family and friends they also respond positively to recommendations from retailers. Thirty-one per cent of shoppers buy products recommended by retailers. With up to 27.5 million shoppers visiting retail stores every day, retailer recommendations can be a powerful form of brand endorsement. “The mix of challenges and opportunities in rural areas requires manufacturers have a great understanding of rural consumers and a proper market plan,” Mr. Dung said. “Especially important is connecting with and nurturing your brand’s super consumers to leverage the power of word of mouth, leveraging retailers as brand ambassadors, and tapping into the power of TV for mass reach while keeping digital channels in the mix for connecting with younger consumers.” Exporters warned of stricter rules ahead of TPP The Trans-Pacific Partnership (TPP), if ratified, will require Vietnamese exporters to meet more stringent requirements and struggle with new non-tariff barriers, said the director of the Center of Integration WTO Technical Assistance of HCMC. Pham Binh An said the trade pact signed by 12 Pacific Rim countries including Vietnam would gradually bring tariffs to zero, but local firms should keep in mind that stricter controls will apply to the origin of products, aside from other barriers that might be put up by importing countries. Intellectual property is another factor which they need to pay attention to, An said at a conference on opportunities and challenges for the food processing industry in HCMC on August 8.  Domestic firms are expected to face a slew of difficulties due to complicated regulations on geographical indications, brand names and labels, he told the event held by the city’s industry-trade department and the WTO Center in HCMC. He also suggested Vietnamese exporters heed the labor commitments in accordance with regulations by the International Labor Organization (ILO). They include freedom of association, right of collective organization and bargaining, and elimination of forced labor, child labor and workplace discrimination. Last but not least, local enterprises should strictly follow environmental rules in their production process, An said. “Challenges will emerge at first but in the long run, TPP will bring countless benefits to local firms.” Experts in the food processing industry said managing material sources could be the biggest obstacle. This stage requires producers to have a certificate of origin for their input material, and to ensure that their production process meets technical standards and food safety requirements. TPP is now waiting for ratification by the legislatures of the member states, but analysts say rising U.S. opposition to TPP in the election year may put the deal in jeopardy. Interest rate lowered by 0.5 percent State-owned commercial banks and a number of commercial joint stock banks lowered annual rates for short-term loans by 0.5 percent in late April in order to remove difficulties facing businesses. They also adjusted the rates for medium and long-term loans for production and business activities to no more than 10 percent per year while offering various preferential programmes, according to the State Bank of Vietnam (SBV). The central bank said thanks to synchronous measures, interest rates have remained stable after increasing by about 0.2-0.3 percent in the first three months of this year. It will keep a close watch on developments of the macro-economy, the monetary market and banking activities while continuing to instruct credit institutions to take measures to balance capital sources, it said. HCM City calls for Japanese investment in infrastructure Chairman of the Ho Chi Minh City People’s Committee Nguyen Thanh Phong has called on Japan to invest in local infrastructure.  During a reception for a delegation from Japan’s Ministry of Land, Infrastructure, Transport and Tourism led by Minister Keiichi Ishii on August 7, Phong expressed his delight at the fruitful development and the huge potential for bilateral cooperation between the city and Japan in infrastructure, transport and urban development.  He also expressed thanks to the Japanese Government for providing official development assistance (ODA) for local key projects, including the metro line 1 from the Ben Thanh market to Suoi Tien Park and the first phase of the metro line 3A from the Ben Thanh market to the Mien Tay (Western) Coach Station.  He called on Japan, via the Japan International Cooperation Agency (JICA), to provide technical assistance for the phase 2 of the metro line 3A project from the Mien Tay Coach Station to Tan Kien.  Phong suggested the Japanese ministry continue its assistance for the city during the operation of the metro line 1. For his part, Minister Keiichi Isshi wished to continue cooperating with HCM City in developing high-quality infrastructure and training human resources.  He also called on local authorities to accelerate the implementation of the Ben Thanh underground trade centre to ensure comprehensive connection with the metro line 1. Vietnam attends investment promotion event in India A conference held in Kolkata, capital city of the state of West Bengal in India, last week aimed to promote investment opportunities in CLMV countries which comprise Cambodia, Laos, Myanmar and Vietnam. The event was held by the Export-Import Bank of India (Exim Bank), the Vietnamese Embassy to India, and the Bharat Chamber of Commerce in Kolkata to help disburse the 85-million-USD package from the Indian government to CLMV countries. It attracted about 70 Indian enterprises, including the Nipha Group, Atha Group, Emami Group, Schneider Electric India, and Haldia Petrochemicals. Speaking at the event, Vietnamese Minister Counsellor Tran Quang Tuyen spoke highly of India’s investment in the CLMV region, particularly Vietnam. He pointed out Vietnam’s advantages over other nations, noting that the country enjoys social and political stability, competitive labour costs and is trade partners with several developing economies. Exim Bank General Director Mukul Sarka said Vietnam has huge potential for development with improved infrastructure, transportation and labour. He encouraged Indian businesses to invest in Vietnam to take advantage of the Free Trade Agreements between Vietnam and large trade partners.-VNA Vietnam Medi Pharm Expo planned in HCM City The Vietnam Medi Pharm Expo 2016 will be held at the Saigon Exhibition and Convention Centre, Ho Chi Minh City, from August 11 to 13, 2016. This year, 280 businesses with 350 displays will be participating in the expo, including giant corporations, leading global companies from countries and territories such as the United States, France, Germany, and Italy, in addition to Japan, Pakistan, Ukraine, and Belarus. Egypt, India, Hungary, Kazakhstan, and Iran, apart from Singapore, the Republic of Korea, Taiwan, Thailand, and China will also be taking part. The highlight of the exhibition will be the display areas of Kazakhstan, Japan, the RoK, and Malaysia, in addition to Iran, China, Taiwan, India and Pakistan. Hosts Vietnam will also have a presence at the exhibition. The popular annual event takes place twice a year in HCM City in August and Hanoi in December, respectively. The expo has been organised for the past fifteen years to promote trade activities in pharmacy and medical equipment, strengthening local and foreign business, to business operations. The exhibition is a platform for the globally advanced medical technologies and equipment companies to access local private and public hospitals and local pharmacy companies which Vietnam has the advantage to initiate exchanges. Hua Phu Doan, vice president and general secretary of HCM City Medical Equipment Association, said that Vietnam has been an emerging and attractive destination for foreign investors, particularly pharmacy and medical equipment companies. According to estimates, revenue from domestic medical equipment market reach 800 million USD every year, are expected to reach 1.2 billion USD this year and 1.8 billion USD in 2018. The average growth would be 18 percent to 20 percent b etween 2016 and 2020. MSB sees strong 1H performance The business performance of the Maritime Commercial Bank (MSB) in the first half of 2016 was better than expected. Revenue in the first half was reported at VND1.28 billion ($57.4 million), up 41 per cent compared to the same period last year, according to the bank’s January-June report released in mid-July. Pre-tax profit stood at VND151 billion ($6.9 million), up 163 per cent year-on-year. The first half saw improvements in the bank’s technology infrastructure and the expansion of its network and human resources. These were to enhance the quality of its customer services, establish new products, and increase corporate governance. As at the end of June, charter capital stood at VND114.5 trillion ($5.2 billion), up 9 per cent compared to the end of 2015 and 20 per cent higher than in the same period last year. Total deposits were VND74.6 trillion ($3.4 billion) at end-June, up 13 per cent compared to the end of 2015 and 20 per cent compared to the same period last year. Total lending stood at VND33.6 trillion ($1.53 billion), a 20 per cent increase against the end of 2015 and up 65 per cent year-on-year. By enhancing the management of its charter capital its capital adequacy ratio (CAR) remained well above the 9 per cent threshold, reaching 22.12 per cent as at the end of June. The liquidity reserve ratio was also higher than requirements, at 19.03 per cent by end-June, according to the report. Along with its positive performance in the first half MSB was also named “Best Commercial Bank in Vietnam in 2016” by International Finance Magazine and won the “Vietnam Domestic Foreign Exchange Bank of the Year” award from Asian Banking & Finance magazine. “We will strengthen our commitment towards sustainable development goals by focusing on the increase of customer satisfaction with the bank’s products and services,” said CEO Huynh Buu Quang, who was previously a senior official at HSBC Vietnam. MSB has been in the media recently as Ms. Nguyen Thi Nguyet Huong, the wife of Chairman Tran Anh Tuan, was dismissed from her role as delegate for Hanoi in the 14th National Assembly (NA). Ms. Huong, born in 1970 in Nam Dinh province, was found to hold dual citizenship and was therefore ineligible to stand under Vietnamese law, according to the National Election Council. She was a delegate for Hanoi in the 13th NA and was recently returned for the 14th NA in the 2016-2021 tenure, but was dismissed on July 17, shortly before the NA’s first session opened on July 20. Hanoi is also considering dismissing Ms. Huong from her role as delegate in the city’s People’s Council. “There are new developments from the police investigation regarding Ms. Huong’s dual citizenship and asset declaration,” Mr. Nguyen Hoai Nam, Head of the Legal Committee at the Hanoi People’s Council told a press conference on July 28. “Ms. Huong’s dismissal is likely to be considered in early August at the People’s Council meeting,” Mr. Nam added. The meeting will last four days, from August 1 to 4. Ms. Huong, Chairwoman of Vietnam Investment Development (VID), a private concern specializing in developing industrial parks in the north, is also Chairwoman of TNG Holdings Vietnam - the investor in several urban area and apartment projects in Hanoi. Dong Nai wants funds for airport resettlement Leaders of the southern province of Dong Nai have asked for the Government’s permission to use 1 trillion VND (44.76 million USD) from the State Capital Investment Corporation (SCIC) to build two resettlement areas.  The resettlement areas will be for people being shifted from the site of the international Long Thanh International Airport to be built in 2019. The airport will be the largest in Vietnam.  The amount is part of the 5.44 trillion USD project to build resettlement areas and to compensate for the removal of a cemetery from the airport construction site, according to the province’s estimates.  To ensure enough funds for the projects, the provincial authorities also asked the Government to issue Government bonds, which should have terms of one year and more, with the interest rate being included in the project’s investment capital.  About 5,000ha will be cleared in six communes of Binh Son, Suoi Trau, Cam Duong and Long An, besides Long Phuoc and Bau Can in Long Thanh district, to permit the construction of the new airport. This will affect about 4,730 households, comprising 15,000 people, besides other organisations, businesses and religious establishments.  According to the province’s survey, households and individuals own nearly 3,000ha of the 5,000ha of land.  Site clearance is a huge challenge for local authorities as they have to hand over at least 2,500ha by the beginning of 2019. The airport’s first phase is scheduled to become operational by 2025.  Funding for the resettlement plans is part of the province’s proposal for a special mechanism for the project, focusing on land acquisition, compensation and relocation policies as well as the construction of infrastructure for relocation, job training and sources of funding.  In particular, Dong Nai asked the Government to compensate the Dong Nai Rubber Corporation, which will have to give up 1,777ha for the airport project. About 600 million VND is proposed to be given as compensation for each hectare that is contributed.  The province also proposed regulations to help pay the school fees of children of households that would be relocated and also the lunch costs for kindergarten children. Each person in the affected areas will get a health insurance card for three years.  Long Thanh Airport is expected to handle 100 million passengers and five million tonnes of freight per year when it is fully completed by 2050. The first phase, including the construction of a terminal and a runway with a capacity of handling 25 million passengers per year, is expected to be finished in 2025, after several threats of delays.  It’s expected to ease pressure on the overloaded Tan Son Nhat Airport in HCM City, which has been handling 20 million passengers a year since 2013 and is expected to exceed its maximum capacity of 25 million passengers this year. HCM City registers growth in industrial production index The Index of Industrial Production (IIP) in Ho Chi Minh City expanded by 7.05 percent in the first seven months of 2016. Notably, key industrial sectors, including mechanics-manufacturing, electronics, chemical-rubber-plastic and food processing, posted a year-on-year rise of 7.3 percent, higher than the common growth of industry as a whole. This was attributed to their efforts to expand markets, update new equipment and improve product quality and competitiveness, according to the municipal People’s Committee. High growth was seen in food and beverages production (14.3 percent), non-metal products (21.3 percent), and machinery and equipment (32.1 percent). In July alone, the city’s industrial production index rose by 3.1 percent. During the month, processing and industrial parks focused on drawing hi-tech investment projects and supporting business activities to record 3.16 billion USD in export and 3.17 billion USD in import turnover. The IIP in the first seven months of last year grew by 6.6 percent. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR