BUSINESS IN BRIEF 27/11 Capital outside banks necessary for real estate market-Central Bank The real estate sector has mainly raised funds from the banking system so it is necessary to seek capital from other channels outside the banking system, said the State Bank of Vietnam (SBV) in a document in response to proposals by the HCMC Real Estate Association (Horea). Previously the association proposed the central bank to have a mechanism to create medium and long term funds for the real estate market and a credit policy for the first house buyers. In response, SBV said that it has already issued a mechanism to raise medium and long term capital by permitting credit institutions to use short term credit source for medium and long term loans. Answering the suggestion of a social housing credit policy for the resettlement of citizens, the central bank said that the social housing policy has been promulgated synchronously by the Government and the National Assembly in accordance with the Housing Law, Government Decree 100/2005 on social housing development and management together with circulars by relevant ministries and agencies. SBV has given Circular 25/2015 guiding assigned banks to provide preferential loans to implement social housing policies and instructed Vietnam Banks for Social Policies to implement the Decree 100. First phase of Phu Lac Wind Power Plant inaugurated The first phase of the Phuc Lac Wind Power Plant has been put into operation in Phu Lac commune of Tuy Phong district, the south central province of Binh Thuan. In the first phase, the plant will use 12 turbines with a total capacity of 24MW using under advanced technology of Denmark’s Vesta and HBB of Sweden. The project has a total investment of nearly 1.1 trillion VND (49.3 million USD), including 85 percent of loans from the German Development Bank (KfW). In September, the plant went into commercial operation and connected with the national grid. The facility is the third operational wind power plant in Binh Thuan, together with those in Tuy Phong and Phu Quy Districts, increasing the province’s total wind power capacity from 36MW to 60MW. Addressing the inaugural ceremony on November 25, Vice Chairman of the provincial People’s Committee Luong Van Hai said that Binh Thuan has carried out numerous incentives to attract investment in wind power. Up to 19 wind power projects have been to date registered in the province. Solar energy pin factory built in Bac Giang   Work on a solar energy pin project started in the Quang Chau industrial park in Viet Yen district, northern Bac Giang province, according to the Kinh Bac City Development Company (KBC). The project invested by the JA Solar Vietnam Company has an initial investment of 320 million USD and is expected to generate 500 million USD in revenue per year upon its completion. In July this year, a contract in principle on land leasing was signed between the Sai Gon – Bac Giang Industrial Park JSC, a member of the KBC and an investor of the Quang Chau IP, and the JA Solar Hong Kong Investment – a subordinate of JA Solar Group. Under the contract, JA Solar will hire 88 hectares of land at the Quang Chau IP to develop the solar energy pin project with a total capital of over one billion USD. The JA Solar project is the one of the biggest investment projects in the industrial park to date and provides jobs for over 3,000 labourers. JA Solar Group is one of the world’s leading solar power pins using green advanced technology. It has eight factories producing solar power products in Europe, the US and Japan. New Lien Chieu terminal to ease Danang Port congestion The Vietnam government is planning construction of a major new expansion to the country’s third largest seaport located in the central city of Danang on the shores of the East Sea, said experts at a recent forum in Hanoi. A pre-feasibility study for the project at Lien Chieu, which has a budgeted cost of roughly US$1.48 billion, is under review by City officials that want to significantly expand the Danang Port’s capacity. The study, prepared by the engineering consulting firm of Tediport, lays out plans for the work to be completed in 3-phases of construction. The first phase projected to cost US332 million would add 1.87 million tons of capacity by 2020. Phases two and three would increase capacity by 17.53 million tons by 2030 and 46 million tons by 2050 at incremental estimated costs of US$353 million and US$792 million, respectively. Unfortunately, said speakers at the conference, the Danang Port is much too far away from Ho Chi Minh City to readily benefit from the overcapacity the country’s southernmost port currently is experiencing. One of the two main terminals at the Danang Port, Tien Sa, is already operating at maximum capacity, with shippers reporting delays as well as over overloading at storage warehouses in the region. Ground was broken on a US$49 million project last July to bump up the capacity of the Tien Sa terminal to 12 million tons of cargo per annum and enable it to handle container ships with deadweight tonnage of 70,000. Official figures showed the terminals at the Danang Port handled a combined 146,000 twenty-foot-equivalent units in the first half of this year, a 19% on-year rise against the same six-month period in 2015. A record setting 6.5 million tons of cargo passed through the port for the whole of 2015, said speakers at the conference. The pre-feasibility study proposed that the new Lien Chieu terminal be developed on a public private partnership basis with funding provided by a combination of funding from the city of Danang along with bank loans and ODA. The study is not clear which country would provide the ODA for the project but speakers at the conference suggested Japan as the most likely prospect to provide the required funds. Their rational was that the Japan International Cooperation Agency (JICA), agreed last April to provide US$781 million for additional port and road infrastructure at the Lach Huyen deep-water port in the northern city of Haiphong. The northern region is home to numerous Japanese foreign-invested manufacturing companies that would benefit from the Haiphong port expansion scheduled to open in May 2018, said the JICA in explaining its reasoning for providing the funding. A similar line of reasoning would apply to the Lien Chieu terminal, said the speakers, as the central region is heavily invested by Japanese businesses who would readily benefit from the expanded capacity. Vietnam is expected to continue to lead Asian trade growth over the coming decades, said the speakers, noting several forecasts that have projected solid growth for the next two decades. These projections combined with those forecasting record growth among ASEAN show sufficient cargo volumes would be available to justify the large infrastructure and port investment in the Lien Chieu terminal. The decision to move forward with the project by the government is prudent, the speakers at the conference concluded. Economic restructuring, growth model reforms for sustainable development Vietnam’s economic restructuring program for the past 5 years brought about noticeable results. The progress has provided a basis for Vietnam to continue its restructuring plan until 2020. Vietnam’s restructuring program in the 2011-2015 period has focused on macro-economic stabilization and restructuring of the national economy in combination with growth model renovation. The monetary market was kept stable and inflation was under control. These achievements have created the momentum for Vietnam to continue the master-plan on economic restructuring until 2020, focusing on renovation of the growth model to improve quality, economic efficiency and competitiveness, people’s living conditions, and Vietnam’s status in the global arena. Many deputies at the 14th National Assembly (NA) session which included on November 13, underlined that economic restructuring can hardly succeed without a favorable, open, and transparent business environment. “While the market is the driving force for commodities production, businesses should be the backbone of that process. The involvement of enterprises will attract investment from society and link scientists, producers, and the application of advanced technologies for effective production”, said Nguyen Thi Thanh, a deputy representing Ninh Binh province. One of the missions of economic restructuring is to improve the development of economic sectors by using high tech to create high added values. In the next five years, the government should avoid scattered investment, minimize the waste of resources, and tap the potential of key economic zones. “We should improve forecasting and rapid response to changes in domestic and global markets. The master-planning on regional connectivity should be strictly implemented with a focus on defining the core industries and principal products that can compete regionally and internationally. Economic development should go hand in hand with the settlement of social and environmental issues”, said deputy Chu Le Chau, who represents Lai Chau province. Under the restructuring program until 2020, Vietnam attaches special importance to building an independent economy, integrating into the global market, and consolidating its status in the international arena. Economist Nguyen Tri Hieu suggests some solutions:“Vietnam should improve its reliability and prestige in the world market to consolidate foreign investors’ trust in its economy. More importantly, we need to improve people’s lives, increase competitiveness, and raise our credit rating in the world.” Cathay Pacific sees good growth potential in Vietnam Hong Kong-based airline Cathay Pacific has seen good growth opportunities in Vietnam in the years to come as this ASEAN market is expanding fast, especially in air passenger traffic demand. Chris van den Hooven, Cathay Pacific’s country manager for Vietnam, underlined the growth potential at a media briefing in HCMC yesterday. The event was organized to review the airline’s performance in this market and to announce the official rebranding of Dragonair under Cathay Pacific as Cathay Dragon. Cathay Dragon said in a statement that the rebranding would bring the award-winning airline closer to Cathay Pacific in a launch that will provide customers with a more seamless travel experience across the airlines’ respective regional and international networks. Cathay Dragon now operates 10 weekly services from Hong Kong to Vietnamese capital Hanoi and seven flights a week to Danang, a central coastal city which has emerged as an attractive destination for Chinese-speaking travelers including those from Hong Kong. Meanwhile, Cathay Pacific offers 18 flights a week between Hong Kong and HCMC, using its modern Airbus A350 aircraft for the route on most days of the week. Van den Hooven described the past 25 years active in Vietnam as “a successful story” for Cathay Pacific and added that the airline saw an opportunity to expand in this market, supported by high economic growth and stronger demand for air travel. Data of the General Statistics Office showed Vietnam welcomed more than 28,560 visitors from Hong Kong in the first 10 months of this year, up a staggering 72.5% compared to the same period last year. Cathay Pacific’s business in Vietnam has fared better in the year to date, he said, and the carrier embraces a long-term commitment to the Vietnamese market because of its growth potential. Asked how Cathay Pacific can deal with rising competition from other airlines, particularly carriers from the Middle East, he said that Cathay Pacific’s advantages lie in its flight network and frequency as well as in-flight offers. Cathay Pacific and Cathay Dragon offer seamless connectivity at their hub in Hong Kong, where they can find good connecting flights to other parts of the world including North America, according to him. Vietnam's 4th wind power plant starts generation The country plans to have 800 megawatts of wind power by 2020, but pricing remains an issue. A wind power plant in the central province of Binh Thuan started its commercial run on November 25, after more than a year of construction. Binh Thuan Wind Power Company said the Phu Lac plant has 12 turbines with a combined output of 24 megawatts, local media reported. The project costs more than VND1 trillion (US$48 million), including a $37 million grant from German government development bank KfW. Vietnam is operating three other wind power plants including two in Binh Thuan and another in the Mekong Delta’s Bac Lieu Province. The country now depends on thermal and hydropower for almost all of its electricity demand, while wind power has only contributed 0.3%, according to a report this week from state-owned utility Electricity of Vietnam. Thermal power plants make up more than half of the total generation, and among them, coal-fired plants account for 34%. The country has been taking steps to develop cleaner and more sustainable energy sources. It plans to have 800 MW of wind power by 2020, compared to 140 MW as of March this year, according to a post on the government's website. Investors have committed to more than 45 wind power projects to generate more than 4,800 MW in total, but most of them are still on paper. Binh Thuan alone has 16. Various media reports suggest that investors in general are reluctant to develop wind power projects because prices in Vietnam are not high enough to cover the costs. In Vietnam, state-owned Electricity of Vietnam, which controls the national grid, reportedly pays US$7.8 cents or VND1,731 per kilowatt-hour for wind power, much lower than the rates in China, Japan and the Philippines. Binh Thuan Province's Wind Power Association has requested the government to raise prices to 12 cents in 2017. FLEGT—A passport to the EU for Vietnamese timber products Vietnam and the European Union (EU) have agreed in principle on a Forest Law Enforcement, Governance and Trade Voluntary Partnership Agreement (FLEGT VPA). It is expected to promote sustainable forest management and wood processing in Vietnam, as well as to earn Vietnam a passport for its exports of timber and timber products to the EU market. This means that the high standards of accountability and traceability demanded by the EU Timber Regulation will no longer be required of Vietnamese timber exports recognised under the FLEGT VPA. With this outcome in mind, Vietnam and the EU have been negotiating the VPA since October 2010. Last week in Hanoi, the two sides announced the conclusion of their negotiations on the core terms of the agreement after six years of deliberations including dozens of high-level and technical meetings. This marks a step forward for the two sides’ cooperation to combat illegal logging, to strengthen forest governance and to promote bilateral trade in legal timber products. Once the agreement is signed and ratified, it will open the door for Vietnam’s wood processing industry to expand its exports not only to the EU, but to other markets as well, benefiting the economy, the environment and society, as well as enhancing Vietnamese wood brands. Vietnam’s exports of wood and wood products have gone to more than 90 countries around the world with their total value exceeding US$7.1 billion in 2015 and nearly reaching US$6 billion in the first ten months of this year. Wood processing now has one of the highest export values of any agroforestry and fisheries sector, contributing to an increase in the nation’s foreign currency collection and its socioeconomic development, while gradually asserting the industry’s position on the international market. Obtaining such a passport has been no easy task, but retaining it will be still more difficult. There are currently nearly 3,900 wood processing enterprises of all types across the nation, of which 95% are owned by the domestic private sector and foreign investors, with the State owning only 5%. Regarding the scale of capital investment, more than 93% of timber processing enterprises are considered to operate on a micro or small scale, 5.5% on a medium scale and only 1.2% on a large scale. Consequently, it is necessary to review and replan the organisation of timber processing facilities in line with export planning so as to ensure the quality of Vietnamese timber exports, especially those from micro- and small-scale enterprises. Moreover, it is necessary to improve the quality and design of wood products so as to suit both domestic and foreign customers’ tastes, while developing sustainable brand names and issuing certification for exports. Each region of the country should choose a wood processing village or business as its leader in gathering others to coordinate production and seek markets for their products, in addition to developing products to fit each market segment and promoting trade to stabilise and expand the market. Finally, to avoid using illegal wood sources and to mitigate risk in the production and consumption of wood products, businesses, producers and craft villages need to say “no” to illegal timber. They should also consult relevant organisations to actively explore the terms of the VPA and to make the necessary preparations to sign onto it in the near future. Standard Chartered PE pours US$40 million in Vietnamese lifestyle platform Standard Chartered Private Equity (SCPE), the private equity arm of Standard Chartered Bank, has poured $40 million into acquiring a significant minority stake in N Kid Corporation (N Kid), a Vietnamese lifestyle platform for kids and teenagers. The information was published on the website of BDA Partners, the exclusive financial advisor to N Kid. According to BDA Partners, N Kid selected SCPE as its preferred partner after several rounds of discussions. SCPE will bring invaluable operational expertise and wide-scale global network to the partnership. Proceeds from the transaction will be used as expansion capital to support the further roll-out of family entertainment centres and retail outlets across Vietnam, the expansion of distribution channels, and the development of new adjacent businesses. Established in 2009, N Kid is the leading integrated children’s lifestyle platform in Vietnam, with operations spanning across the distribution, and retail segments. The company now operates 30 family entertainment centres across the country under the brand names tiNiWorld and T-CLB, Phuong Nga Toys, mom and baby products distribution stores and altogether 20 Toyland and Babyland retail outlets. Meanwhile, SCPE provides companies with expansion capital as well as acquisition and management buy-out finances. It has invested over $6 billion in 100 companies worldwide. Pouring capital in N Kid marks SCPE’s second investment in Vietnam in the course of 2016. Earlier, in March, SCPE invested a combined $25 million in Vietnamese start-up M-Service, the operator of mobile e-wallet MoMo. In September 2014, SCPE spent $35 million to acquire a significant minority stake in Mekong Capital’s restaurant chain Golden Gate. Only two weeks later, it completed the purchase of another significant minority stake in An Giang Plant Protection JSC, a market leader in the Vietnamese agricultural sector. New loan packages for social housing     Two new preferential loans, unrestricted by scale and deadline, for social housing and cheap commercial housing projects will be provided to low-income earners. The new packages are expected to continue the VND30 trillion housing stimulus package. Nguyen Tran Nam, chairman of Viet Nam Real Estate Association (VNREA) told the association’s meeting held earlier this week that the Law on Housing 2014 and Decree No 100/2015/ND-CP on social housing and cheap housing stipulates that capital for the two packages would come from commercial banks and the Viet Nam Bank for Social Policies. Commercial joint stock banks with controlling State stake-holdings would have to spend 3 per cent of their total outstanding loans for developers and buyers of social housing projects. The second source for loans for social housing projects would come from the Viet Nam Bank for Social Policies. The bank would use 50 per cent capital from the State budget and the moblise the remaining capital to provide loans for people to buy social housing with a maximum interest rate of 5 per cent. However, the policies have not taken effect yet as it was infeasible for commercial banks to set up a fund for loans for social housing projects. Most commercial banks have faced difficulties in providing preferential loans to social housing projects. Secondly, the Viet Nam Bank for Social Policies has not only focused on loans offered to low-income earners but other programmes such as agriculture, maritime economic development and supporting students. VNREA in June sent a document to the Prime Minister, State Bank of Viet Nam and the minister of Construction to ask for specific laws enforced to provide capital for social housing. The chairman affirmed that there would be money inflows in the social housing segment in 2017. VNREA targeted establishing a pilot property investment fund to have independent capital mobilisation for the market without depending on bank loans. It also proposed mechanisms and policies to encourage the development of social housing and cheap commercial housing segments with areas of less than 75sq.m and selling prices of less than VND15million per sq.m. The association suggested reducing VAT and corporate income tax to facilitate real estate firms to build cheap apartments. Several real estate firms and specialists said that the Government should have stable solutions to increase the supply of social housing and cheap housing projects. VNREA said there have seen negative signs in the estate market, especially the unbalanced housing structure. Up to 70 per cent of property products in the market are high-end apartments while most people need low and medium houses. It has been hard to create apartments with selling prices of less than VND20 million per sq.m in Ha Noi and HCM City. Since the end of VND30 trillion stimulus package, estate firms have not attention to social and cheap commercial housing. Nguyen Van Duc, deputy director of Dat Lanh Real Estate Company said thhat Government support in taxes, capital and administrative procedures were necessary for the development of social housing programmes. PM urges e-payment development     Deputy Prime Minister Vu Duc Dam has said there is a need for all ministries and relevant agencies to co-ordinate and connect with specific policies to promote electronic payments. He said there was a need to minimise cash payment, and make e-payments compulsory while encouraging its use. Deputy PM Dam made the comment during a Viet Nam E-payment Forum on Thursday in Ha Noi to discuss three major topics that included combining efforts by Government departments to promote online tax collecting, tax payments and encouraging online payment in e-commerce and retail, promoting online payment in transport and the ability of connecting to other payment activities in Viet Nam, and opportunities and challenges facing Viet Nam’ banking sector brought by Fintech companies. The deputy PM said that currently Viet Nam had about 125,000 public services provided by the government and authorised agencies. Of these, only 1,200 services had implemented e-technology in their services. The Government has approved a master development plan of e-commerce from now until 2020. However, the implementation of e-payment is still limited and the habit of making cash payments was not easy to change, Dam told the forum. To promote e-payments, Bui Quang Tien, Director of the State Bank of Viet Nam (SBV)’s Payment System Department said the central bank has made many important recommendations by asking the Ministry of Finance to propose tax policies to encourage e-tax payment and e-payment in e-commerce development in retail shops. The SBV will complete a legal corridor and initiate policies to encourage e-payment via the automated clearinghouse (ACH) and ask National Payment Corporation of Vietnam (NAPAS) to build ACH system, and continue to complete financial switching system to promote and improve the efficiency of e-payment in e-commerce and e-tax payment. Lai Viet Anh, Deputy Head of Vietnam E-Commerce and Information Technology Agency (VECITA) said that 7 per cent of payments were made online in e-commerce. She said more efficient solutions should be envisaged apart from incentives to exempt or refund tax for businesses who use e-payment service. Instead of using administrative measures, the participation of intermediaries such as companies who provide intermediate e-payment services should be encouraged. When users recognised substantial benefits from e-payment service, they would automatically begin e-payment. Also at the forum, Nguyen Manh Thang Deputy Director of Directorate for Roads of Viet Nam, said that promoting online payment in transport was a need and toll collection without asking drivers to stop would benefit them in many ways. However, in Viet Nam, this plan was encountering problems. He attributed the problems to obsolete technology which was inconveniencing users and co-ordination between road project investors and authorised bodies was still poor. Nguyen Hong Truong, deputy minister of transport, said the transport sector had many services relating to e-payment. The transport ministry had conducted a roadmap for toll collection. It would make efforts to remove barriers at toll stations by 2019. The government recently has also asked his ministry to study post-paid electronic toll collection. Vu Quang Lam, from VETC Vietnam Joint Stock Company, said there were currently several types of e-payment smart cards for toll collection. Drivers should only have only one type of smart card thus making it easy for them. Truong said in time to come, there will be only one kind of smart card for toll collection which would make it convenient for users. At the forum, Truong Gia Binh CEO of FPT Corporation proposed four solutions to the Government and relevant ministries to improve e-payment in toll collection. He wanted the government to soon issue regulations and a roadmap for users to implement compulsory e-payment in toll collection and payment in public transport. The Ministry of Transport and local authorities have been asked to work with the SBV to soon have a standard e-payment solution with the ability of connecting to other payment activities in the public sector to avoid wasting resources. The Ministry of Transport has been requested to instruct relevant bodies to agree sharing revenues from toll collection between Build-Operate-Transfer (BOT) investors and Build-Own-Operate (BOO) investors so as to spur the development of automatic electronic toll collection nationwide. The SBV and Ministry of Transport have been asked to offer incentives and enhance mass media to boost e-payment in transport. Jewellery market shines ahead of year-end festive season     Tran Thi Lam of HCM City has come to a Sai Gon Jewellry Company showroom to buy rings. Her son is set to get married and she is studying the market and prices. There are many collections and designs, and she loves one of the latter, but since the prices are too high she is considering more, she says. The year-end is the wedding season and Lam’s family is one of many to celebrate a wedding this year by buying jewellery, mostly gold. The year-end is also a time of festivals and people like to buy jewels for their relatives and friends. Demand for jewellery in HCM City is sharply up already. A jeweller in District 1 said in fact demand started to rise in the middle of last month. Jewellery shops in districts 1 and Thu Duc said to meet the year-end demand they have introduced new designs and collections. A Sai Gon Jewelry Company (SJC) spokesperson too said the company has added many new products and collections. Ten new collections have been introduced at prices of VND60-100 million (US$2,700-4,500), she told Sai Gon Tiep Thi newspaper. Bracelets, necklaces, rings and other jewels costing VND5-20 million ($220-800) have also been launched, she said. She revealed sales had surged this year compared with the last, reaching VND300 billion in the first 10 months, nearly double that of last year. She expected the sharp rise to continue through the end of the year. Ho Thanh Tuan, director of Hoang Gia Pearl, said in the last three months his company has launched 30 new collections with nearly 300 designs. The pearl jewellery market in Viet Nam has grown strongly, he said. The fact that it is not just older people but also young ones who now like pearl jewels is pushing up the market, he told Sai Gon Tiep Th?. HCM City’s trade pacts with provinces a success A trade co-operation programme between HCM City and other cities and provinces over the last five years has significantly improved product quality, met consumer demand and promoted socio-economic development, city officials have said. Begun in 2011, the programme focuses on providing information on authorities’ oversight of commerce, supports firms in creating links in production and distribution, strengthens oversight to ensure product quality, and improves human resources training. Speaking at a conference in HCM City yesterday, Nguy?n Qu?nh Trang, deputy director of the Department of Industry and Trade, said the programme had helped HCM City distributors and retailers find suppliers of quality products, including regional speciality products. It has also helped manufacturers find steady outlets for their products and feel secure about investing more in expansion and improving product quality. More businesses have signed up for the programme, with 1,349 contracts worth more than VNÐ22.13 trillion (US$977.1 million) signed as of last month, she said. HCM City firms had bought goods worth VNÐ15.49 trillion ($684.2 million) and sold  VNÐ6.63 trillion of goods.. The event this year for the first time attracted the participation of businesses from the northern provinces of Hà Giang and Hòa Bình. Vu Th? Thu Hà, deputy director of Kim Bôi Agro-Forestry Joint Stock Company in Hòa Bình Province, said many specialities of the northwest region like n?m huong (thin top-mushroom), n?m mèo (wood-ear mushroom) and táo mèo (an apple-like fruit) were sold only in supermarkets and restaurants in the north. “I hope that via this event, we can distribute these products in HCM City,” she said. “Consumers in HCM City as well as in southern provinces should feel secure when using our products, which meet hygiene and food safety standards.” Nguy?n Th? Thu Th?y, deputy general director of Saigon Co.op, said her company regularly participated in matching supply/demand events in an aim to find quality and regional special products for its retail chain. Lê Thanh Liêm, deputy chairman of the HCM City People’s Committee, said the city had huge demand for many kinds of products like fruits and vegetables, pork and seafood, but could only meet 20-30 per cent of demand. The city has signed co-operation agreements with many provinces, including Lâm Ð?ng, Ð?ng Nai, Ti?n Giang, Long An, Kiên Giang and Bà R?a-Vung Tàu to ensure supply of goods to the city market, especially during T?t (Lunar New Year) when demand jumps by 20-30 per cent, he said. Deputy Minister of Industry and Trade H? Th? Kim Thoa urged HCM City to expand the co-operation model to other places, and said she hoped more businesses would join the programme to increase the supply of quality goods. Despite achievements, the programme has some shortcomings, including 187 principal contracts that either have not been implemented or have been carried out ineffectively. Trang of the Department of Industry and Trade said the weaknesses were caused by various factors, including not meeting retailers’ demand and failing to negotiate discount rates and payment methods. Ph?m Thành Kiên, director of the HCM City Department of Industry and Trade, said the department would continue to co-operate with its counterparts in other cities and provinces to exchange information about supply/demand connection programmes, and support firms in creating links in production and distribution, as well as strengthen inspections to secure product quality. He urged businesses to focus more on developing their material zones to ensure consumer access through more supply and expand.distribution networks. At the event, 369 contracts were signed between distributors, export companies and eateries in the city, as well as specialty manufacturing establishments and agricultural co-operatives, among others. Nearly 1,000 producers, distributors, wholesale markets, restaurants, hotels, banks and eateries from 38 provinces and cities took part in the two-day event, which included an exhibition featuring more than 350 booths displaying products of different regions in the country. Dry ports to reduce traffic jams HCM City has proposed the construction of two dry ports in the city’s High-tech Park in District 9 and Ðông Nam Industrial Park in C? Chi District. The port in the High-tech Park will be 10ha in area with an expected capacity of 150,000teu by 2020. The one in the Ðông Nam Industrial Park will be built on a 6ha area. Lê Thành Ð?i, deputy head of the High-tech Park’s management board said that since there were some 800 containers travelling from the park to the Cát Lái port in District 2 everyday, the new inland port will not only serve the activities of the park but also help reduce congestion between the two destinations. Lê Hoàng Minh, deputy director of the city’s transport department, said that the new port in Ðông Nam Industrial Park will reduce the pressure of inland goods delivery for the park and the Tây B?c Industrial Park. It will also help facilitate the goods delivering process from the South-eastern provinces of Tây Ninh, Bình Phu?c and Bình Duong to the Sài Gòn River, he said. There are currently 11 dry ports connecting the Vung Tàu sea port with the city, 7 of which are located in the city. The construction of a new flyover was started yesterday as part of the city’s efforts to reduce traffic jams. The flyover costs some VNÐ169 billion (US$7.4 million), connecting the Nguy?n Van C? flyover with Võ Van Ki?t street. It will help facilitate traffic from districts 1, 4, 5, 7, and 8 to the southern area of the city and vice versa, according to the management centre of the Saigon River Tunnel. VN tops Asia in relationship fulfillment Vi?t Nam ranks first out of 10 Asian countries surveyed in relationship satisfaction, according to the inaugural Prudential Relationship Index, the first of its kind in Asia, which was released in HCM City on Wednesday. The score for Vi?t Nam, taking into account all relationships, not only spousal, is 83/100. It means in Vi?t Nam people’s primary relationships fulfil 83 per cent of their desired relationship needs on average. The survey lists the keys to a good relationship - being easy to get along with (77 per cent), being fun (71 per cent), having similar lifestyles (65 per cent), respecting individuality (63 per cent) and having compatible personalities (61 per cent). Vietnamese have fewer arguments with their spouses than in any other country. More than anywhere else, husbands and wives join hands to resolve financial issues. Up to 79 per cent of married Vietnamese have joint bank accounts. The digital technology revolution has greatly affected to relationships in Vi?t Nam, with couples and even parents preferring their mobile phones rather than talking to family members. Thirty two per cent of Vietnamese couples said one of the reasons for arguments is their partners spending too much time on mobile phones and computers. Vietnamese are likely to have better relationships with their children than with parents or friends, and score 58/100, the second highest in Asia. The average relationship score for adults and their parents is 52/100. With best friends, it is 49/100. In Asia, Vietnamese parents most want to enjoy the companionship of their children, with 97 per cent thinking that frequent interaction is one of the most importance aspects in an ideal relationship with children. They are less likely to get angry with their children than parents in other countries. The index surveyed 5,000 respondents aged 25 to 55 in Cambodia, China, Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, South Korea, Thailand, and Vi?t Nam in July. In Vi?t Nam, 500 were polled. But Phuong Ti?n Minh, CMO of Prudential Vietnam, said despite ranking high in relationship fulfilment, in Vi?t Nam “gaps are also present in the level of relationship satisfaction, with family demands, financial uncertainty and technology causing rising tension and stress.” Binh Dinh approves VND31 billion for Tet food stabilisation     The People’s Committee of Binh Dinh Province has approved a VND31 billion fund to stabilise prices of essential goods during Tet festival 2017. This was announced by Man Ngoc Ly, director of Binh Dinh Department of Industry and Trade. The fund is aimed at achieving domestic price stabilisation for the products. It is used to avoid sudden increases in prices of the products and avoiding speculation and price increases, especially in the province, he said. It will also supply essential goods for people in mountain and remote areas during the Tet festival. These included rice, sugar, confectionery, cooking oil, fish sauce, in addition to meat, eggs, vegetables and various fruit. Those goods must meet standards on quality, food hygiene and safety, as well as have quarantine certificates from relevant offices. Further, companies must sell goods at prices 3 to 8 per cent lower than market prices. This year, the companies that accept loans from the provincial stabilisation fund include Sai Gon Co.op Binh Dinh Co. Ltd – owner of Co.op mart Quy Nhơn and Co.op mart An Nhon, the Anh Nhat Import-Export Manufacture and Trade Limited Company in Quy Nhon, addition to three good suppliers including Van Canh JSC, Vinh Thanh JSC and An Lao JSC. The three-month price stabilisation programme will start on December 15, 2016 and continue until March 15, 2017. Petro Vietnam takes credit loans for power project     Vietnam National Oil and Gas Group (PetroVietnam) on November 23 signed a contract with the Export-Import Bank of Korea (Korea Eximbank) for funding the Song Hau 1 thermal power project. Under the contract, PetroVietnam is also taking loans from nine other foreign commercial banks, in an arrangement made by Citibank US. The contract is valued at US$1.2 billion, with credit insurance provided by the Korea Trade Insurance Corporation (K-Sure) and the Korean export credit contract provided by Korea Eximbank. The project requires a total investment of $2.05 billion, of which 70 per cent, an estimated $1.43 billion, will be in loans. PetroVietnam has arranged for a Korean export credit agency loan of $987 million with a 17-year term, and another international trade loan of S213 million that has a 10-year term. Young-Pyo Hong, deputy president of Korea Eximbank, expressed his confidence in the project at the signing ceremony, while Nguyen Vu Truong Son, general director of Petro Vietnam, appreciated the co-operation between his company and foreign banks. The Song Hau 1 thermal plant project, with the capacity to generate 1,200MW (with two units of 600MW), will be spread over 115 hectares in southern Hau Giang Province. One of the key projects approved by the prime minister, it is part of the national power master plan VII, which aims to construct power plants between 2013 and 2020 to meet the rising demand in southern Viet Nam. PetroVietnam’s experience with major power projects such as Vung Ang 1, Thai Binh 2, Ca Mau 1 and 2, Nhon Trach 1 has helped it successfully negotiate and arrange loans with international banks within a period of one year. Sơn and Hong expressed hope that in the future, PetroVietnam and Korea Eximbank would have the opportunity to work together. Completed on time, this project will provide Việt Nam with much-needed electricity and contribute to regional economic development. Also present at the ceremony were members of PetroVietnam’s board of directors, representatives from the Song Hau 1 power project management board and officials from Korean Eximbank, K-Sure and Citibank. Credit growth in Hà Nội rises 15.6% Outstanding loans of Hà Nội-credit institutions are estimated to touch VNĐ1.43 trillion (US$63.27 million) by the end of November, up 15.6 per cent since last December, reveals the latest report by Hà Nội Statistics Office. Compared with last month, the loans rose 2.2 per cent. Of the total, short-term loans rose 12 per cent, while medium- and long-term loans surged by 20.4 per cent. Despite a decreasing deposit interest rate, by the end of November, the city’s credit institutions are estimated to have mobilised a total capital of VNĐ1.64 trillion, up 11.2 per cent against last December. The Hà Nội Statistics Office also reported that the capital city’s export turnover in November is estimated to reach $901 million, up 15.5 per cent against the same period last year. The city’s total export turnover in the past 11 months rose 12 per cent year-on-year to $9.685 billion. In November, the capital spent $2.258 billion on imports, bringing the total import value in the past 11 months to $22.281 billion, down 4.6 per cent against the same period last year. Hà Nội’s trade deficit in the past 11 months stood at $12.596 billion, the report noted. Hà Nội to host January online financial fair Consumers who seek information about financial and insurance services can receive advice from service providers at the Online FinFair Việt Nam Week from January 3 to 7, 2017. Customers will be able to access www.thebank.vn to chat online with advisers or watch video clips introducing products and services, as well as attend online conferences, said Phạm Thanh Hà, director of the Megalink Joint Stock Company – one of the event’s organisers. The online fair, the first of its kind, is expected to link 30 service providers, including commercial banks, life and non-life insurance companies, and financial firms, with one million consumers. Five workshops discussing issues about life insurance, health insurance, credit cards, collateral lending and trust lending will also be held.   The Online FinFair Việt Nam 2017 will be organised by Samo Communications and Technology Company, in collaboration with the Megalink Joint Stock Company and the Hà Nội Information Technology and Communication Transaction Centre. The online fair is being sponsored by the Việt Nam Internet Association and the Hà Nội Association for Communication and Public Relations (HANICA). Vietnam holds successful trade seminar in Czech Republic A seminar on investment and business opportunities in Vietnam attended by dozens of entrepreneurs and government representatives was held on November 23 in Prague by Ambassador to the Czech Republic Truong Manh Son. Ambassador Son opened the seminar by emphasizing the readiness of the Embassy and the Vietnam Ministry of Industry and Trade to promote the collaboration of enterprises and institutions in both countries. The Ambassador reminded the gathering that after more than six decades of mutual diplomatic and trade relations between both countries, Vietnam is still a country of high economic growth and good investment opportunities. He told those in attendance that he considered the seminar an excellent opportunity to further deepen the existing collaboration between businesses and institutions of both countries considering the upcoming Vietnam-EU free trade agreement that will come into effect in 2018. In addition, he mentioned that total commercial trade between the two countries has remained much too modest and only amounted to a fraction of its potential, noting that the total exports and imports of Vietnam with the Czech Republic amounted to just US$755 million in 2015.  vietnam holds successful trade seminar in czech republic hinh 1 In his speech, Vietnam Ambassador Son stressed the benefits of the coming trade pact and the positive developments he expects it will have on bilateral trade and talked specifically about segments of the economy of the greatest interest for the business community of Czechoslovakia. Czech entrepreneurs in attendance in turn told the Ambassador that they had an interest in the automotive industry, medical and pharmaceuticals, agriculture, food, energy and construction in Vietnam. During the second part of the seminar the Ambassador and entrepreneurs had the opportunity to discuss the possibilities of collaboration and business and investment opportunities the Czech Republic offers Vietnamese companies. CNS inks strategic partnership with card developer Saigon Industry Corporation (CNS) has announced its strategic partnership with NXP Semiconductor to supply smart cards and solutions related to security cards. Under the partnership, the Dutch card manufacturer will offer and assist CNS in the development of new-generation smart card solutions. Chu Tien Dung, general director of CNS, said, “CNS is adopting solutions for the development of IC products in collaboration with foreign partners, including NXP. We are also working with many developers of cards, card readers and non-cash payment solutions. These are the contributors to the building of our IC factory in the city in the future.” In addition, CNS aims to become a supplier of IC products, solutions and applications integrated with smart cards, security control cards and membership cards. Together with NXP, CNS will carry out many projects of smart city and smart government, responding to the strategic development of the Internet of Things in Vietnam. On this occasion, CNS also signed cooperation agreements with many other partners including card developers like VietCard, SmartWorld, Greentech and WireCard, to jointly offer solutions and applications for various fields like education, healthcare, and transport. The IC factory of CNS will go up in the Saigon High-Tech Park in HCMC’s District 9. This is the “core” of the IC development program in the city with estimated investment of VND6.6 trillion. The facility is designed with a capacity of some 5,000-10,000 semiconductor wafers per month. With the use of locally-produced IC, electronic and telecommunications products made in Vietnam may have their added value increase by 15-30%. Vietnam ministry defends computerized lottery against traditional rival The newly-launched American-style computerized lottery in Vietnam is running with transparency and doing no harm to its traditional counterpart, the Ministry of Finance asserted on November 23. In July, Vietlott, a company fully owned by the finance ministry, introduced its Mega 6/45 computerized lottery, with the jackpot initially set at VND12 billion (US$537,600). The jackpot is rolled over if no winner is found. The computerized lottery is a result of cooperation between Vietlott and an indirect subsidiary of Malaysia-based firm Berjaya Corp Bhd (BCorp), which was granted an 18-year investment license to operate the computerized lottery in the country in January. Vietlott has since found four jackpot winners, with the respective pretax prizes of VND56.1 billion (US$2.48 million), VND71 billion (US$3.17 million), VND65 billion (US$2.9 million) and VND92 billion (US$4.11 million). With three jackpots having been won this month alone, while the jackpot probability is one in 8.1 million, the computerized lottery has come under suspicion over its transparency. It has also been blasted by traditional lottery companies, who say the new lottery is eating up their market share, especially in southern Vietnam. The traditional lottery has a top prize of only VND1.5 billion (US$67,000), with 21 lottery companies operating in southern Vietnam recently announcing a joint plan to raise the prize to VND2 billion (US$89,300) next year. All of those issues around the new kind of lottery were addressed at a media meeting held on Wednesday by the finance ministry at its headquarters in Hanoi. The ministry has indeed received a number of questions from the press regarding the operation of the computerized lottery. One of the questions was why a foreign partner is allowed to jointly run the computerized lottery, whereas the law says that lottery is a service exclusive to the state. In response, Vietlott deputy CEO Nguyen Thanh Dam said Berjaya Corp is only indirectly cooperating with Vietlott through its local subsidiary Berjaya Gia Thinh Corp, under a business cooperation contract (BCC) worth some US$210.58 million. Dam claimed the BCC between Vietlott and Berjaya has nothing to do with the equity of the company, which is still 100 percent owned by the finance ministry, adding that the foreign partner is only in charge of equipment investment and procurement in the joint venture. “By the time Vietlott was launched in Vietnam, not a single local manufacturer had been able to produce the machines, equipment and technology solutions needed to run the computerized lottery,” Dam said. Nguyen Hoang Duong, deputy head of the finance and banking bureau under the finance ministry, also said the ministry had to partner with a foreign entity to run the computerized lottery because “Vietnam is inexperienced in this new business model.” “The cooperation helps Vietnam leverage the experience and technology of the foreign partner as well as sharing losses if the business proves unsuccessful,” Duong said, adding that the finance ministry obtained government approval for the partnership in 2011. Duong, however, refused to disclose the share of revenue the Malaysian partner enjoys from the Vietnamese business, saying it is “confidential information both sides have agreed not to make public.” As per current law, traditional lottery companies have to give 100 percent of their revenue to the budget of the local administrations where they are based. Duong said Vietlott will do the same, but in a different manner. “Vietlott is required to pay a 15% excise tax and a 10% value-added tax,” he said. “After excluding these taxes and tax-deductible expenses, the company will continue paying a 20% corporate income tariff for the remaining revenue.” Duong said Vietlott will also contribute the post-tax revenue to the local budget of the provinces or cities its agents are based. The company is present in nine cities and provinces, including Ho Chi Minh City, Can Tho City, An Giang Province, Binh Duong Province, Dong Nai Province, Ba Ria-Vung Tau Province, Khanh Hoa Province, Dak Lak Province, and Da Nang City. Vietlott raked in VND734.4 billion (US$32.79 million) in revenue between July 18 and November 20, and has paid its winners a total of VND226 billion (US$10.09 million), according to Duong. The company’s tax payment had topped VND85.5 billion (US$3.82 million) as of the end of last month. Addressing concerns that Vietlott would ‘steal’ buyers from the traditional lottery, Duong said the computerized lottery in fact “has little impact” on its well-developing traditional counterpart. “Twenty-one traditional lottery companies in southern Vietnam post a collective revenue of VND240 billion [$10.71 million] a day, while Vietlott sells only four million tickets per draw,” Duong said. The Vietlott jackpot combination is randomly selected every Wednesday, Friday, and Sunday. With the computerized lottery fetching VND10,000 each, the revenue in its each selection is VND40 billion ($1.79 million). “Vietnam’s lottery sector is estimated to rake in VND75 trillion [$3.35 billion] this year, and computerized lotteries only account for 1.3 percent of the total figure,” Duong concluded. Vietnamese fruit sent to tough markets Vietnam exported nearly 10,000 tonnes of fresh fruit to choosy markets such as the United States, Canada, the Republic of Korea and Japan in the first 10 months of this year. This export volume doubled the figure from the whole of last year. According to Director of the Ministry of Agriculture and Rural Development’s Plant Protection Department Hoang Trung, some 5,100 tonnes of dragon fruit and 1,550 tonnes of mango were shipped to these countries. The United States led the import of Vietnamese fruit, with 2,600 tonnes of dragon fruit and 1,200 tonnes of mango, followed by Japan, Canada and the Republic of Korea. The country exported nearly 2.1 million tonnes of fruit and vegetables, making a turnover of some 2 billion USD during the period. Meanwhile, it imported nearly 420,000 tonnes of fresh fruit. Trung said his department was conducting an experimental project on exterminating fly disease on red dragon fruit, following the requirements of Japan. Japan will officially open its doors to the Vietnamese fruit by early 2017. Vietnam expects to increase its exports to Australia and Taiwan in the future, after the two markets begin allowing businesses to import Vietnamese fresh mango and dragon fruit, respectively, this year. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR