BUSINESS IN BRIEF 6/8 Kien Giang province eyes $1 billion in export turnover   The Mekong Delta province of Kien Giang is striving to earn at least 1 billion USD from exports by 2020, according to the provincial Department of Industry and Trade.  Farm produce is expected to bring home 495 million USD; aquaculture, 230 million USD; other commodities, 44 million USD and products from state-owned enterprises, 250 million USD. The province will branch out frozen shrimp, frozen squid and rice to markets with strong purchasing power while enhancing the competitiveness and integration capacity of businesses. Maintaining and enlarging the distribution network as well as stabilising traditional markets and expanding potential markets are also among the province’s goals. Along with creating favourable conditions for local enterprises to upgrade their production, the province has encouraged farms to apply advanced technology.  The province wants to export high value-added agricultural products and develop competitive commodities to gain a foothold in foreign markets. In addition to enhancing trade promotion, the province will use market surveys and international and domestic trade fairs and exhibitions to popularise local products. The province’s standout products have been sold in 43 countries and territories. In the past seven months, the locality earned 196 million USD from exports, 44.5 percent of its yearly plan and up 1.8 percent from the same time last year.  Meeting export goals has been challenging due to fierce competition from regional countries, shortage of capital among businesses, restricted markets and lack of materials for aquaculture processing. However, the province still enjoyed a surge in rice exports in July, increasing total rice shipments to 270,000 tonnes in seven-month period. Vietnam-Canada cooperation to benefit largely from TPP Canada and Vietnam will have a lot of opportunities to bolster their cooperation stemming from their membership of the Trans-Pacific Partnership (TPP) agreement. The remarks were made by Canada’s Consul General Richard Bale at a reception hosted by Nguyen Thanh Phong, Chairman of the HCM City municipal People’s Committee in Ho Chi Minh City on August 4. Bale also noted that the relations between Canada and HCM City will also thrive on the back of the two’s TPP engagement. Phong, for his part, asserted that the local authorities have been working to provide all possible favourable conditions for foreign investors as they have made crucial contributions to the City’s development. He spoke highly of the trade ties between the two countries, citing the value of 4.7 billion CAD made in 2015. Vietnam is Canada’s largest ASEAN trade partner. In 2015, Vietnam imported 353.6 million CAD worth of food and seafood from Canada, a rise of 48.1 percent from 2014. Emirates launches flight to Yangon, Hanoi Emirates on August 3 launched a new daily service from Dubai to Yangon (RGN) in Myanmar and Hanoi (HAN) in Vietnam, expanding its network in South East Asia.  Flight EK388 from Dubai to the capital city's Noi Bai International Airport was welcomed with a traditional water cannon ceremony.  "With an extensive global network of 155 destinations in 81 countries and territories, Emirates will help enhance connectivity for Ha n oi and its neighbouring areas, providing more convenience and choice for travellers, additional opportunities for inbound tourism and more export markets for regional products," Haitham Al Battawy, Emirates' country manager for Viet n am, said at the launching ceremony.  "We are confident that the launch of this service will enable us to contribute to the development of tourism and trade in Viet n am, particularly in the country's capital Ha n oi," Battawy said.  Deputy Director of Noi Bai International Airport (NIA) Nguyen Thi Kim Ngan said the launch of Emirates Airlines service had brought the total number of airlines operating at NIA to 50, comprising 45 international airlines and five domestic ones.  This new service expands the airline's network in the Southeast Asian region to 12 cities in seven countries and offers more choices and convenience to passengers travelling between Hanoi and Yangon and to Dubai and beyond.  Hanoi is the airline's new passenger gateway in the country, following the launch of services to HCM City in 2012 and the cargo-only service to Hanoi in 2013.  Flight EK389 departs from Hanoi's Noi Bai International Airport at 10.50pm, and arrives at Yangon at 12.20am. The flight then departs from Yangon at 1.50am and arrives at Dubai International Airport at 5.05am. Inbound, flight EK388 departs from Dubai at 3.30am and arrives in Yangon at 11.40am. It then departs from Yangon at 1pm, arriving at 3.30pm in Hanoi.  A three-class configured Boeing 777-300ER will be operated on this route. However, details of the transaction have not been revealed. Song Da Corp and VIS declined to comment on the transaction, while officials from Thai Hung Trading JSC were not available for comment. Thai Hung Trading JSC is a steel trader and producer based in the northern province of Thai Nguyen and has total fixed asset worth VND4.1 trillion. The company is also said to occupy a market share of 12 per cent in the steel industry. VIS is a steel producer based in Ha Noi. The company has recently announced a year-on-year drop of 80 per cent in its after-tax profit to VND587 million in the second quarter of this year. A sharp drop in the company's profit came after the steel market slowed down in the second quarter, resulting in a lower sales volume for the company. Besides, the inventories remained high as steel prices declined sharply, VIS said, and added that it made the steel firm create a defensive provision worth VND23.3 billion for the inventories and receivables. The VIS share price has jumped 14 per cent in the last four trading days, closing on Wednesday at VND13,000 per share. The share price has more than doubled since March. D'. San Raffles project to become five-star hotel The Tan Hoang Minh Group’s luxury D’. San Raffles project, in a prominent location just minutes away from Hoan Kiem Lake, will be changed into a five-star-hotel from a complex with condominiums, a trade center and office space, as was initially planned. At a Q&A question at the Hanoi People’s Council on the project on August 2, Director of the Hanoi Department of Planning and Architecture, Mr. Le Vinh, said that Tan Hoang Minh previously hoped to build a 12-storey block but the city did not grant approval. After some consideration it recently agreed on an eight-storey building. Chairman of the Hanoi People’s Committee Nguyen Duc Chung said the land will be converted into a five-star hotel instead of a complex of condominiums and a commercial center. “I recommended this plan because the city lacks 20,000 hotel rooms, which is one of the basic elements in turning tourism into a key industry of the city,” he said. Despite the city’s announcement, Tan Hoang Minh’s website still describes the project as a luxury complex with condominiums, a commercial center and office space. The group has confirmed that the project must complete procedures from city authorities on design and planning. The Department of Planning and Architecture granted a planning permit for the project on April 7. “Tan Hoang Minh is now completing legal procedures to be able to start the project in the near future,” a statement on its website said. The site has a checkered history. In November 2004 the Hanoi People’s Committee decided to revoke the license for the 4,000 sq m site at the corner of Hang Bai and Hai Ba Trung Streets to build a commercial center, office space and housing. The plot covers more than 3,600 sq m and contained the Hanoi Plastics Factory and 17 households. Some households within the project sought record compensation of VND1 billion ($45,000) per sq m. Neither the investor nor the city’s authorities agreed and the last of the families accepted a figure of VND500 million ($22,500) per sq m for ground floor space and VND200 million ($9,000) per sq m for second floor space. Site clearance and compensation were completed in 2011 but construction was delayed until the approval of the Hanoi Master Plan and regulations on high-rise buildings in the city center. In order to secure its license, the developer had to negotiate with local residents and win approval from a 27-member council of architects. Five years after the site was handed over it remains empty. Tan Hoang Minh is also pushing forward with the completion of its D.’ Palais de Louis and D.’ Le Pont D’Or projects in the capital. D.’ Palais de Louis, which consists of 244 luxury apartments, is in the finishing stages of construction. The Tan Hoang Minh Group primarily operates in the field of property and finance and owns premium projects in Hanoi such as D’. San Raffles, D’. Palais de Louis (in Nguyen Van Huyen Street, Cau Giay district), and D’. Le Pont D’or (in Hoang Cau Street, Dong Da district), among others. The BRG Group caused a stir in Hanoi’s real estate market recently after announcing it would build a luxury hotel at 22-32 Le Thai To Street, near Hoan Kiem Lake. The project, however, is facing opposition in terms of architectural design because of its sensitive location in the capital. MEF III invests in ABA Corporation Mekong Capital’s Mekong Enterprise Fund III (MEF III) has announced its second investment, in ABA Corporation, a temperature controlled transport provider. The amount of the investment was not disclosed but a representative from Mekong Capital told VET that MEF III typically targets investments ranging from $6-15 million and can make both minority and buy-out investments. Founded in 2008, ABA began as a temperature controlled transport provider and in 2016 entered the cold storage business through the acquisition of a cold storage facility in Hanoi with around 12,000 pallet positions. The company is now rapidly evolving towards providing an integrated cold chain logistics service in Vietnam.    “The company has established itself as a leading cold chain transport service and solutions provider in Vietnam,” said Mr. Chad Ovel, Partner at Mekong Capital. “The company’s competitive edge is its dedicated management team, with a commitment to flawless integrity: right product, right time and right temperature, with a track record in providing high quality services.” Mr. Ovel believes that with Mekong Capital’s well-proven approach towards adding value as a shareholder and its extensive network of international experts and resources, ABA will improve their operations, building a stronger management team while deploying world class transportation best practices. “ABA will grow at a rapid pace and compete successfully against multinational competitors,” he added. ABA’s transport business is divided into three key business segments: temperature controlled transportation services, delivery services, and distribution services. ABA’s cold storage provides cold storage, cross-docking and other value added services. It serves several of the largest modern trade retail and consumer goods companies in Vietnam, including Big C, VinMart, Metro, Unilever, and BEL. “We are excited and confident in this partnership,” said Mr. Luong Quang Thi, Founder and CEO of ABA. “Mekong Capital became ABA’s companion as we share common cultures and values with a long-term strategic vision. This combination facilitates us in strengthening our management team, approaching world best practices and improving service quality to ready us for a rapid and sustainable growth.” Launched in May 2015, MEF III is a private equity fund and currently has $112.5 million in committed capital. It focuses on investments in Vietnamese consumer-driven businesses such as retail, restaurants, consumer products, and consumer services. SHB: Q2 operation costs up, profit down Operational costs incurred by Saigon-Hanoi Bank (SHB) increased significantly in the second quarter of the year while net profits fell, according to its first half report. Operational costs stood at VND542 billion ($24.29 million) in the quarter, 58 per cent higher year-on-year, with net profit at VND179.84 billion ($8.06 million), down 16 per cent. The bank incurred total costs of VND1.04 trillion ($46.62 million) in the first quarter, 25 per cent higher than the figure on December 31, 2015. Net profit increased to VND424.19 billion ($19.01 million), 11 per cent higher. Operational costs for banking services were significantly higher in the second quarter, reaching VND29.47 billion ($1.32 million), up 23 per cent year-on-year. In the first half the figure stood at VND44.37 billion ($1.98 million), 15 per cent higher than on December 31. Operational costs for other business activities were also up sharply. In the second quarter these costs reached VND65.74 billion ($2.94 million), 215 per cent higher year-on-year. The first half figure was VND96.23 billion ($4.31 million), up 37.92 per compared with December 31.     The bank’s bad debt ratio in the first half was not indicated in its report but it noted that VND237 billion ($10.62 million) was set aside for risk provisions, 3.5 per cent lower than on December 31. Loans to bank customers in the first half reached VND141 trillion ($6.32 billion), 8 per cent higher than on December 31, while customer deposits totaled VND159 trillion ($7.12 billion), up 7.5 per cent. Net interest income in the second quarter was VND769.2 billion ($34.48 million), 8.5 per cent lower year-on-year. The first half figure reached VND1.65 trillion ($73.96 million), up 14 per cent higher compared to December 31. Foreign currency trading activities resulted in a loss of VND3.36 billion ($150,628) in the second quarter against a profit of VND10.3 billion ($461,749) in the second quarter of last year. Profit stood at VND22.74 billion ($1.01 million) in the first half, down 51 per cent compared to December 31. The bank’s securities trading activities brought in only VND516 million ($23,132) in profit in the first half while securities investments lost VND564 million ($25,284). SHB is the major shareholder in two securities companies: the SHB Securities Joint Stock Company (SHBS) and the Saigon-Hanoi Securities Joint Stock Company (SHS). In late July it registered to divest its 4.8 per cent holding in SHS on HNX.      Total assets in the first half increased to VND212 trillion ($9.5 trillion), 4 per cent higher than on December 31. Ratings agency Moody’s said in May that SHB was one of a few Vietnamese banks that may be exposed to risks from lending to the Hoang Anh Gia Lai Group (HAGL). SHB has the second-largest loan exposure to the Group, comprising a high 6 per cent of it tangible common equity (TCE) as at the end of March, according to Moody’s.  Furthermore, the negative impact of drought on Vietnam’s agriculture sector will also influence the performance of the bank, given its sizeable loan exposure in the sector. According to Moody’s, 20.5 per cent of SHB loans were in agriculture as at the end of 2015, one of the highest among Vietnam’s commercial banks.   Hanoi's GRDP growth hits 9 percent in 2016-2020 Hanoi People's Council has approved its 2016-2020 social economic development plan. Accordingly, to reach the target, Hanoi will focus on its economic goal with the average Gross Regional Domestic Products (GRDP) growth rate in the 2016-2020 period will be 8.5 to 9 percent. While service sector increase 7.8 -8.3 percent; industry-construction sector up to 10-10.5 percent and agricultural sector will achieve a rise of 3.5-4 percent. The city's economic structure to 2020 is set a target with service accounting for 67-67.5 percent; industry-construction of 30-30.5 percent; agiculture of 2.5-3 percent and the annual average GRDP per capita is projected to reach VND 140-145 million (equal to US$ 6,700-6,800). Besides, the city will mobilize social investment capital of VND 2.5-2.6 trillion. VNPT’s profit increases sharply after restructuring plan The Vietnam Posts and Telecommunications Corporation (VNPT) said after one year of VNPT’s restructuring plan, total revenue of the first half of this year reached VND 63,150billion and total profit of VND 2,160billion. Its contribution to state budget was VND 1,558billion. Of these, Vinaphone’s mobile service maintained a good growth rate, with 6.5 million of new subcribers (an increase of 47.5 percent compared to the same period of last year). The revenue was up 7 percent against last year. Total revenue for the first half of this year from Vinaphone reached VND 25,409billion & profit of VND 569billion equal to 51.76 percent over its yearly target. Mr. Pham Duc Long, General director of VNPT, before adding VNPT’s restructuring plan, VNPT had applied new management system (BSC/KPI) to ensure a balance between the restructuring plan and business development as well as change management strategy & laborers’awareness. HCMC unveils action plan to prop up business The HCMC government will take a slew of measures to support enterprises as part of an action plan aimed to realize the target of having 500,000 firms by 2020, up from the current 281,000. The city revealed the action plan and ways to implement the Government’s Resolution 35/NQ-CP on support for businesses towards 2020 at a press conference on August 2. The city will set aside VND3 trillion (US$135 million) for startups and technological innovations, make procedures and policies transparent, and help household businesses become companies. In addition to 500,000 firms, the city expects the private business sector to contribute 65% of the city’s gross regional domestic product (GRDP) and 64% of total investment in the next four years. In the 2006-2010 period, the private sector contributed 51% to the city’s total investments and 61% in 2011-2015. The proportion is expected to soar to 71% in 2020 instead of 64%, Vo Van Hoan, head of the city government’s office, said at the press conference. Under a business support plan approved by the city government on Monday, there will be at least two dialogues held annually for the city’s leaders and enterprises to solve relevant problems, director of the Department of Planning and Investment Su Ngoc Anh told the conference. Local authorities will improve the one-stop-shop business registration mechanism, create an enabling environment for businesses, and ensure equal access to resources for enterprises, Anh said. Hoan said the city will establish a startup fund worth VND1 trillion and provide VND2 trillion for a technological innovation fund and open a startup support center. Hoan noted that besides the city’s startup and technological innovation funds, universities, enterprises and associations are also encouraged to set up their own funds to support young entrepreneurs. Asked by the Daily about specific solutions to convert household businesses into enterprises and help firms grow, Anh replied that the department will work with districts next week to discuss assistance measures for businesses to join local supply chains.  Agencies and districts in the city will set the action plan in motion next week, Hoan said. Tra fish farming area down, output up Output of unprocessed tra fish (pangasius) in the Mekong Delta region edged up in the first seven months of this year though the farming area for the fish fell sharply, according to the Vietnam Pangasius Association (VN Pangasius). The new acreage under tra fish farming had stayed at 1,705 hectares in the year to July 21, dropping 23% year-on-year and taking the total down to 1,821 hectares, said Vo Thi Thu Huong, deputy general secretary of VN Pangasius, citing statistics from tra fish farming provinces in the delta. However, the output of unprocessed tra fish inched up 1% to nearly 570,000 tons in the period thanks to higher productivity. A hectare yielded 313 tons on average, well above 285 tons in the same period last year, Huong said. Despite the rise in output, tra fish growers still incur losses in the period as prices decreased significantly. A kilo of tra fish sold for VND19,000 (85 U.S. cents) between January and mid-March, VND22,500-23,000 at the end of May and VND18,500-18,900 at present, showed data of VN Pangasius. Nguyen Ngoc Hai, chairman of Thoi An Tra Fish Cooperative in Can Tho City, ascribed the decline in prices to the low export price, at only VND18,500 per kilo. Therefore, tra fish farmers rack up losses of VND1,000-1,500 per kilo but they would suffer more if their fish farms are attacked by diseases. According to the General Department of Customs, Vietnam had earned nearly US$718 million from exporting tra fish in the year to June 15, up 5.5% against the same period last year. Of the total, shipments to the U.S. reached US$169 million, rising by 15.6%; the European Union (EU) US$120.6 million, down 6.9%; and China and Hong Kong US$106 million, surging 69%. In the first six months, the EU imported 16.8% of Vietnam’s total tra exports, down from 18.22% last year; China and Hong Kong 14.7%, up 4.4 percentage points; and ASEAN 8.7%, up from 8.31% in the same period last year. Helpless Eximbank looks to SBV for help Eximbank’s board of directors said it would seek help from the State Bank of Vietnam (SBV) to check rules on the rights of shareholder groups eligible to nominate candidates for the board. Some Eximbank board members met local media on Monday to explain the lender’s decision to delay its extraordinary meeting set for August 2 in HCMC. The SBV last Friday told Eximbank to look into the rights of groups of shareholders that want to nominate candidates for the board and report to the SBV. The central bank will then decide a list of nominees for shareholders to elect additional board members in the 2015-2020 term. This was the reason behind the delay, Dang Anh Mai of Eximbank’s board told the meeting with reporters. He said the board would coordinate with the supervisory and management boards to collect information about candidates for the board and report to the SBV. Eximbank will ask the central bank for help to check relevant rules. Mai said this will make it easy for the SBV to determine the list of nominees for the lender. After the list is decided, Eximbank will choose a new date for the extraordinary meeting, Mai said. Another Eximbank board member, Ngo Thanh Tung, said a shareholder had petitioned the bank to dismiss all board members over suspicion of cheating in the election at the general meeting last December. The supervisory board launched an investigation and then announced that there was no reason to fire Eximbank board members.    At present, Eximbank’s board has nine members including Cao Xuan Ninh, an official of the central bank. Ninh joined the bank in mid-December last year but tendered his resignation for personal reasons at the end of March this year. However, his withdrawal has not been decided since Eximbank shareholders staged protests at the two previous general meetings. In a document prepared for the general meeting planned for August 2, shareholders were expected to select three more members for the board. A source told the Daily that at least one official of the SBV would be nominated to replace Ninh. As of July 14, eight persons had been proposed as candidates. Three firms in supporting industries get loan interest support The HCMC government has agreed to provide full loan interest support for three producers of parts for supporting industries under an investment stimulus program of the city. Nguyen Phuong Dong, deputy director of the Department of Industry and Trade, said on August 2 that investors of 26 projects have so far registered with the Center for Development of Enterprises in Supporting Industries under the department to join the program. There of them have been picked, Dong said at a conference on support for firms in supporting industries and connectivity with American electronics firm Jabil Vietnam in HCMC on August 2. The three are a VND38-billion project to produce bolts and screws by Lidovit Industrial and Trading JSC, a project worth VND264 billion of Minh Nguyen Supporting Industries JSC to make plastic products and a VND32-billion technological rubber project of Thai Duong Rubber Technology JSC.  Samsung is considering selecting Minh Nguyen as a supplier of components for its electronics and household appliances complex at Saigon Hi-Tech Park (SHTP) in District 9. Dong said besides the three projects, the trade department has submitted four other projects whose investors want to join the investment stimulus program. The program is aimed at spurring the development of supporting industries and small- and medium-sized enterprises (SMEs) by giving financial support to SMEs to invest in modern technology.   In 2011, the city government issued Decision 33/2011/QD-UBND on stimulating investments by helping businesses gain easy access to bank loans but it produced lower-than-expected results. Under the stimulus program approved last October, projects in high-tech, manufacturing, supporting industries, trade and agricultural production services, healthcare, education, culture and sport, infrastructure and environment can enjoy loan interest support. In particular, producers in four major industries – mechanical engineering, electronics, information technology, food-foodstuff processing and chemical pharmaceutical-rubber, and textile-garment and footwear – can enjoy all interest rate coverage for loans under the programs. Ca Pass Tunnel to be opened to traffic next year Ca Pass Tunnel linking the central provinces of Phu Yen and Khanh Hoa is scheduled to be opened to traffic next year as Deo Ca Investment Co finished digging the tunnel last week, according to the Ministry of Transport. As calculated by the investor, when in place the tunnel will help reduce the distance between the two provinces to 13.19 kilometers from 21.4 kilometers on the Ca Pass. The time for passing through the tunnel will be only ten minutes, four times less than the road. Traveling on the pass is dangerous, especially in the rainy season when landslides often occur. Ca Pass Tunnel is a major project on National Highway 1A and has a total length of 13.4 kilometers, with Ca Pass Tunnel and Co Ma Tunnel stretching 3.9 kilometers and 500 meters respectively. It also includes more than nine kilometers of approach roads and a bridge and two parallel tunnels having two lanes and 8.5 meters in width. The project is being carried out under the build-operate-transfer (BOT) and build-transfer (BT) with a total investment of roughly VND11.4 trillion (US$510 million). Jan-Jul FDI pledges plunge in HCMC Foreign direct investment (FDI) approvals in HCMC dived in the first seven months against the year-earlier period, according to an updated report on the city’s socio-economic performance.    Though there were more FDI projects approved in the city in January-July, their registered capital neared US$900 million, down a staggering 64% year-on-year. Earlier, the HCMC Statistics Office reported that FDI pledges in the city in the first seven months slid by up to 65.17% year-on-year to US$863.6 million as foreign firms registered over US$638 million for 448 new projects and US$225.5 million for 78 operational projects. The fall in FDI was attributable to limited land for lease at industrial parks (IPs) in HCMC, especially those in good locations. Land rents at IPs in HCMC were also higher than in many other localities.   Inconsistent regulations on site clearance and compensation were also to blame, particularly those for housing projects. In contrast, the number of projects and capital registered by domestic companies in HCMC grew strongly in the first seven months. HCMC had around 20,470 startups with combined registered capital of VND175.9 trillion (US$7.8 billion) in the period, up 19% and 55% year-on-year, respectively. Overall, the city saw new capital of operational and newly established firms in the first seven months soaring 58% from a year earlier.   According to the report, credit institutions in the city had mobilized VND1,697 trillion by end-July, up 8.29% from end-2015 and 19.23% against the same period last year. Deposits in the Vietnam dong rose stronger than foreign currency and accounted for 86.7% of the total. Meanwhile, total outstanding loans had reached VND1,358 trillion by the end of last month, a 20% pickup year-on-year. Medium- and long-term credit made up 57.6% of the total and short-term loans the remaining 42.4%.  By end-May, the bad debt ratio of banks in HCMC had stood at 4.35%, up 0.43 percentage point compared to late last year. The HCMC government said more bank loans had gone to the manufacturing sector. In the January-July period, outstanding loans for the five priority sectors of agriculture and rural development, production of export goods, small- and medium-sized enterprises (SMEs), supporting industries and high-tech enterprises surpassed VND154.24 trillion. Credit for SMEs made up 60% of the sum. Ba Ria-Vung Tau pitches for investment in four areas The southern province of Ba Ria - Vung Tau will focus its investment on hi-tech industry and agriculture, port logistics and high-quality tourism. Hi-tech industrial projects will prioritise energy-saving and eco-friendly products of high added value and competitiveness, while those in the port logistics sector will include facilities in support of the Cai Mep - Thi Vai international terminal. High-quality tourism projects will focus on building seaside resorts and developing ecological and spiritual tourism along with meetings, incentives conferences and exhibitions (MICE). During a local press conference on August 3, Vice Chairman of the provincial People’s Committee Nguyen Thanh Long said the province has made a list of sectors eligible for investment incentives. Ba Ria - Vung Tau pledges all possible support for long-term business operations in the province, he said. An investment promotion conference is slated for August 10 to introduce the province’s potential, incentives and infrastructure to diplomatic agencies, investment and trade promotion organisations, and overseas and domestic investors. The province is a gateway to the southern key economic zone thanks to its convenient location, abundant natural resources and a massive network of seaports. In the first half of this year, the province registered seven foreign-invested projects worth nearly 350 million USD, raising the total number of FDI projects to 297 with a total value of more than 27.16 billion USD. Domestic projects in the six-month period counted 10 with a total registered capital of around 1 trillion VND (45.45 million USD), increasing the total domestically invested projects to 442 worth approximately 241 trillion VND (10.95 million USD). Work begins on Duyen Hai 2 thermal power plant Construction of the Duyen Hai 2 thermal power plant began in Dan Thanh commune, Duyen Hai town, the Mekong Delta province of Tra Vinh on August 3. Covering an area of 60 hectares, the 2.2 billion USD plant has two turbines with a total capacity of 1,200 megawatts. The coal-fuelled plant, invested by Malaysian Teknik Janakuasa Group under a build-operate-transfer (BOT) contract, is expected to become operation in the next five years. After 25 years of operation, the plant will be transferred to the Vietnamese side. It is one of four thermal power plants in the Duyen Hai Power Centre, invested at a total capital of more than 5 billion USD in an area of 878.91 hectares. The thermal power plant Duyen Hai 1 was officially put into commercial operation and connected to the national grid this year. Turbines 1 and 2 at the Duyen Hai 3 power plant are slated to begin commercial operation in late 2016 and 2017, respectively while the expanded Duyen Hai 3 plant is under construction. Jan-Jul industrial production index up 7% in HCMC The index of industrial production (IIP) in HCMC in the first seven months inched up 7.05% year-on-year, with many sectors faring better than in the same period last year. The seven-month period saw the beverage sector expanding by 14.3%, production of non-metallic minerals by 21.3% and machinery by over 32%, according to the city’s report on January-July socio-economic performance. The report showed that in July alone a number of sectors performed better than in the year-earlier period, including motor vehicles with growth of 30%, production of non-metallic minerals 35%, and paper and related products 23%. Meanwhile, the mechanical engineering, electronics, chemical-rubber-plastic and food-foodstuff processing sectors grew by 7.3% versus a year earlier as enterprises in the four key industries of the city spent big on new equipment and improvement of product quality and competitiveness.   In the first seven months, retail sales of goods and services neared VND407 trillion (US$18.2 billion), a year-on-year pickup of 11.4%. Last month’s consumer price index (CPI) was 0.19% higher than in the previous month. HCMC shipped abroad US$17.6 billion worth of goods in January-July, rising by 1.8% from the year-earlier period. Its exports to China climbed 28.8%, Hong Kong 13.7%, South Korea 30.4%, Indonesia 171.2%, the Netherlands 19.4% and India 27.4%. In contrast, shipments to Japan, Malaysia, Australia, the Philippines and Singapore shrank in the first seven months. In the first half, HCMC’s gross regional domestic product (GRDP) totaled some VND477 trillion, a 7.47% increase against the same period last year. HCMC sets 12 major targets for 2016, including GRDP growth of 8%, total factor productivity’s (TFP) contribution to GRDP at a minimum of 35%, development investment accounting for 30% of GRDP and trained workers making up 75% of the total workforce. The city looks to create jobs for 125,000 people, reduce the jobless rate to less than 4.5% and lower the poverty rate by one percentage point. Customs clearance time for businesses to be reduced by 15-30% The Vietnam Customs forecasted that the Vietnam National Single Window (VNSW) will reduce customs clearance time for businesses by 15-30%. The draft plan to implement the VNSW in the 2016-2020 has been completed, which is expected to reduce time and expenditures for businesses and increase transparency and effectiveness for the public and private sectors. As of May 31, 2016, the VNSW officially connects nine out of 14 ministries, including the Ministries of Finance, Industry and Trade, Transport, Science and Technology, Agriculture and Rural Development, Natural Resources and Environment, Information and Communications, Culture, Sports and Tourism and Health with 31 procedures, 90,000 files and 6,000 businesses. In 2015, nine different ministries got involved in the national one-stop shop portal. Except for the Ministry of Finance, 26 administrative procedures of the remaining ministries were handled through the mechanism. The NSW is designed to reduce customs clearance time for businesses by 15-30% and increase their connectivity and information exchanges with State-run management agencies. Vietnam has conducted successful technical connection with Indonesia, Malaysia, Thailand and Singapore through ASEAN Single Window. Daikin to finance VN's largest air conditioner factory Daikin Air-Conditioning Joint Stock Company and Thang Long Industrial Park II Company on Monday signed a land lease contract to build the largest air conditioner factory in Viet Nam. The agreement was signed in HCM City. Located in the northern Hung Yen Province, the 22,000sq.m factory is expected to have a total investment of 10 billion yen (US$93.6 million). The production centre will start operating in April 2018, with an annual capacity of about 500,000 AC units. The capacity will be doubled to roughly a million units by 2020. In addition, the factory will employ about 500 people in the first year of operation, increasing to 1,500 people when it begins full-capacity production. In recent years, economic development has led to strong income growth of the middle class in Viet Nam, driving the demand for air conditioners in daily life. The Japanese company aims to capitalise on Viet Nam's potential for rapid growth specifically, and in the Southeast Asian nations in general. This could be a huge opportunity for the country to promote its infrastructure and create more jobs. Vietfish 2016 opens in HCM City The Viet Nam International Fisheries Exhibition, or Vietfish 2016, themed "Asia's Home of Seafood," opened at the Sai Gon Exhibition and Convention Centre in the city's District 7 on August 3. Vietfish – the only international aquaculture expo of Viet Nam and the ASEAN held by the Viet Nam Association of Seafood Exporters and Producers (VASEP) – attracts more than 200 domestic enterprises and foreign companies each year from 14 countries and territories, such as Malaysia, Thailand, Japan, Germany and the United States. The three-day expo features 350 booths displaying various high-quality fresh and processed fisheries products as well as new processing equipment, machinery and advanced technology serving the sector's requirements for sustainable development. VASEP Chairman Ngo Van Ich said a series of conferences on industry-related topics ranging from fisheries certificates to market trends would be held on the sidelines of the expo. Ha Noi week to promote southern farm products Ha Noi will have 96 sales points in 12 districts to provide special and safe farm products to the local people. The activity is being held as part of a week-long programme for identifying special and safe farm and food products from the southern region, being held in Ha Noi from August 12 to 18. The organisation board said about 100 kinds of special farm products would be sold at 96 sales points during the week, such as Ben Tre green skin grapefruit, Ben Tre coconut, Tien Giang durian and An Giang rice. They all will have safety and quality certificates. The week aims to introduce special and safe farm products from the south to the people in Ha Noi and provide measures to identify the safety and quality of products, Nguyen Van Chi, director of Ha Noi Agriculture and Rural Development Department, said at a conference in Ha Noi on August 2, while speaking about the organisation of the event. The consumers would also get a chance to know about many kinds of special farm products, brands, their origin and geographical indications in the southern region, Chi said. This was also an opportunity for promoting sales of southern farm products because it was harvest time of these products, he said. A seminar on enhancing agricultural trade between Ha Noi and other provinces and a ceremony to sign co-operation agreements in trade promotion between the departments of agriculture and rural development of Ha Noi and of other provinces will also be held.  Co-operation agreements among producers and distributors of special and safe farm products are expected to be signed during the week. The programme is being organised by the Ha Noi Agricultural Trade Promotion Centre and the agriculture and rural development ministrys Agricultural Trade Promotion Centre. Charity in memory of British tourist to support needy children in Vietnam Aiden’s girlfriend Bluebell Baughan has set up a charity in the name of Aiden Webb, who died climbing Fansipan mountain in Vietnam - the highest peak of Indochina in 2016. Aiden plunged to his death after slipping down a steep waterfall. According to Youcaring.com, Aiden Shaw Webb Ascent (ASWA) aims to help relieve some of the consequences of poverty that the Hmong people residing in Xin Chai village, about 30 kilometers trekking from Sapa town, Vietnam’s northern Lao Cai province endure on a daily basis. Primarily, Bluebell Baughan hope to raise enough funds to provide payments for the materials and labour required to conduct essential repairs to the school building and the necessary educational equipment they currently lack. ‘ASWA also aims to be in the position to pay for the provision of public amenities such as the construction of concrete pathways in the place of their current dirt walkways that transform into dangerous gullies during the rainy season’, Aiden’s girlfriend said. Women’s Museum celebrates 49th birthday of ASEAN An exhibition celebrating the 49th anniversary of the formation of the Association of Southeast Asian Nations (ASEAN) has opened at the Vietnamese Women’s Museum located at 36 Ly Thuong Kiet Street in Hanoi. The anniversary offers us an opportunity to reflect on the evolution of ASEAN relations and consider new ideas and initiatives to strengthen, enrich and deepen our future, said Nguyen Nguyet Nga, spouse of Deputy Prime Minister and Foreign Minister Pham Binh Minh at the opening. She said the exhibition running through August 17 showcases more than 300 photos, and nearly 100 news reports and other documents that tell of significant events and track ASEANs history to date. The 49th anniversary on August 8, she said, is truly an important milestone for the rapidly expanding relationship among the member states. She expressed her hope that the project will be an important and useful contribution to strengthening the cultural and ties of friendship among ASEAN members well as be a valuable public-diplomacy, research and education resource. Rowers rent Italian boat for Rio Olympics The Vietnam rowing team has leased an Italian boat to compete at the Rio Olympics, according to Nguyen Hai Duong of the National Sports Administration. He said female rowers Ho Thi Ly and Ta Thanh Huyen arrived in Rio on August 2 and will have a few days to practice in the newly acquired high-quality boat before the competition begins. "These girls have worked so hard over the past four years to compete at this event, so it’s great to see them get the opportunity to use a state-of-the-art boat. This opportunity is fantastic," he said.  School meals assure adequate nutrition for primary students A set of 40 standardised menus, which are both nutritious and delicious, have been created to ensure the good health and stature of primary students in Da Nang, Hai Phong and Hanoi cities. This comes under the school meal project jointly launched by the National Institute of Nutrition and the municipal Departments of Education and Training, after a recent survey revealed that the current food rations for primary students are short of dietary fiber and vitamins. The school meals have been selected based on such criteria as healthy and balanced diets, preparation with a wide range of local food, and reducing the proliferation of processed food, sugar and salt. The National Institute of Nutrition will give support to primary schools in nutrition education through the “Three minutes to change awareness” programme. School meals have crucial roles in improving students’ physical fitness and mental health, the institute said, noting that some developed countries like Japan, the United Kingdom and the United States have mapped out specific regulations on nutrition and food hygiene standards for students’ meals. In Vietnam, fine-tuning children’s nutrition through rational school meals is a significant content in the National Nutrition Strategy and comprehensive plan on developing Vietnamese people’s physical strength and stature for the 2011-2030 period. According to the institution, Vietnam is facing a double nutrition burden as the country continues to record high malnutrition rates in rural areas, while the number of obese children continues rising in the cities. Moreover, a shortage of micronutrients is common in both rural and urban children. By studying children’s nutritional status in six cities and provinces accross Vietnam, the Southeast Asian Nutrition Survey showed that anaemia among primary students was 11.8 percent, vitamin A deficiency 7.7 percent and vitamin D deficiency ranging from 46 to 58 percent. Saigon Centre retail mall opened in town Keppel Land Limited said on August 1 that it had opened a major retail mall in Saigon Centre in downtown HCMC, with Japanese retailer Takashimaya among its anchor tenants. The new seven-floor shopping center is integrated with the existing tower as part of the second phase of the Saigon Centre project. Its entire 55,000 square meters of retail space has been leased out. The mall stocks over 400 international and local brands, including leading Japanese retailer Takashimaya’s first department store in Vietnam covering 15,000 square meters. Tatsuo Yano, director of Takashimaya Singapore Co Ltd, said the third overseas store of Takashimaya has a parking lot for about 5,000 motorcycles and 500 cars. The investor said about 25% of tenants in Saigon Centre are new entrants. Well-known international brands debuting in Vietnam include luxurious fashion brands of Carolina Herrera, Kenzo, Moschino, Stuart Weitzman and Armani Exchange. Nearly 30% of the retail mall’s space is set aside for dining, with about 50 food outlets and cafes. Food brands appearing in the city for the first time include Oedo Japanese food village, which is inspired by an old town in Tokyo and comprises seven outlets, Ember Grill & Italian serving Eurasian dishes and more than 100 types of cocktails, and Logic Pizza with its open kitchen style. Japanese Ike Ike Maru will also be opening its first branch here. The shopping center provides free customer support services like phone chargers, personal storage, strollers and wheelchairs. The first and second phases of the Saigon Centre project are co-owned by Keppel Land, Toshin Development Co Ltd, and Vietnamese firms Southern Waterborne Transport Corporation (Sowatco) and Saigon Real Estate Corporation (Resco). Keppel Land holds a 45.3% stake in the project. Bad debts remain below 3% target Non-performing loans (NPLs) as of the end of May accounted for 2.78 per cent of the entire banking system's total outstanding loans. This was still under the three per cent threshold targeted by the Government, Deputy Governor of the State Bank of Viet Nam Nguyen Thi Hong said during a Government press conference on August 1. The move was made after concern was expressed about an upward trend in NPLs, as reported recently in H1 financial reports of several commercial banks. Hong said the central bank would still consider the handling of bad debts one of top priorities during the last five months of the year. She said the central bank had instructed commercial banks, whose NPLs were more than three per cent, to report measures to resolve the bad debts issue to the central bank. "Besides a strict control on credit growth to ensure credit quality and to avoid raising new bad debts, the governor has also asked credit institutions to make provisions for their risky loans," Hong said. She said the governor had also asked the Viet Nam Asset Management Company (VAMC) to further deal with bad debts in a move to control the total bad debts under three per cent. In July, financial statements released by some large commercial banks showed that bad debts increased in the first half of the year. Notably, bad debts skyrocketed at Eximbank, surging sharply from 1.86 per cent at the end of last year to 5.3 per cent by the end of June. Of Eximbank's total bad debts worth VND4.285 trillion (US$191.29 million), subprime debt surged 13 times to reach VND2.415 trillion, while the increasing rate of doubtful debt and potentially irrecoverable debt was 34.8 per cent each to touch VND797 billion and VND1.073 trillion, respectively. Due to the high NPL rate, Eximbank had to double its provisions to touch VND324 billion in H1, causing pre-tax profits to fall sharply to end at VND79 billion, down 88 per cent year-on-year. The Bank for Investment and Development of Viet Nam (BIDV) -- the country's largest commercial bank in terms of assets -- also reported that its bad debts increased from roughly 1.6 per cent at the end of last year to two per cent by the end of June. The increasing bad debts in H1 were worth more than VND3 trillion, bringing the bank's total bad debts to reach VND13.183 trillion. Of these debts, potentially irrecoverable debts and doubtful debts rose from VND5.190 trillion and VND887.76 billion to touch VND6.343 trillion and VND2.326 trillion, respectively. Sacombank's bad debts, as of the end of June, also increased to 2.83 per cent from 1.85 per cent at the end of last year. Due to the large number of bad debts, Sacombank's provisions surged 86 per cent in H1, causing the bank's pre-tax profit to drop 76 per cent year-on-year to touch VND363 billion. Experts attributed the increase in bad debts in banks in H1 to the fact that the VAMC bought only a small amount of bad debts in the first half of this year, after meeting the target for controlling bad debts of the entire banking system under three per cent at the end of September last year. According to a Government report on the country's socio-economic results in H1 2016, VAMC has so far bought VND241 trillion of bad debts. The number of bad debts was nearly the same as compared with those released late last year. It meant that the new bad debts that arose in commercial banks in H1 remained with the banks, instead of being transferred to the VAMC, as was done in previous years.  VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR