BUSINESS IN BRIEF 30/11 Vietnam urged to tap wind power potential   Vietnam has great potential for developing wind power but big initial investment, technical complexity and a lack of quality technicians are deterring the development of the sector. At a workshop on wind power held in Hanoi on November 29, Ingmar Stelter, Director of the Energy Support Programme between the Ministry of Information and Communications and the German Agency for International Cooperation (GIZ), said Vietnam has a long coastline with an estimated wind power capacity of 24GW. However, the total capacity of Vietnam’s existing wind power farms has just reached 159.2MW. According to Deputy Minister of Industry and Trade Hoang Quoc Vuong, the main causes hindering the development of wind power are the high production cost while purchase prices are low, which discourages investors. The domestic supply sources for parts, equipment and services are lacking, as are qualified technicians. Vuong said the Vietnamese government is continuing with efforts to perfect the legal framework and improve the organisational structure and management method in the wind power sector. The Ministry of Industry and Trade is revising wind power selling prices for facilities on land and at sea in the direction of increasing the prices according to Decision 37/2011/QD-TTg of the Prime Minister. Naveen Raghavan Balachandran from Vesta, a Danish group specialising in manufacturing wind turbines and supplying related services, said the group will assist Vietnam in training workers and technicians. He also suggested Vietnam revise its policy to attract private investors in the sector. According to the adjusted national power master plan for 2011-2020 with a vision to 2030, total wind power capacity is projected to reach 800 MW by 2020 (0.8 percent of the country’s power output), 2,000 MW (one percent) by 2025 and 6,000 MW (2.1 percent) by 2030. HCM City’s CPI up 0.55 percent in November Ho Chi Minh City’s consumer price index (CPI) in November increased 0.55 percent from the previous month, and 3.77 percent compared to the same month last year, the municipal Statistics Office reported on November 29. Growth was seen in six out of the 11 major goods and services groups with the highest hike reported in transportation at 1.78 percent due to the increased price of fuels. Other groups recorded price hikes were food and catering services with 1.07 percent; housing, electricity and water (0.24 percent); other goods and services (0.13 percent); beverage and cigarette (0.05 percent); and apparel, headwear and footwear (0.01 percent). Especially, in the restaurant and catering service group, foodstuff rose 1.77 percent, dine-out climbed 0.26 percent, while food dropped 0.15 percent. Some commodities experienced a drop in their prices, including cultural, entertainment and tourism products with 0.01 percent, and home appliances, 0.1 percent. Prices of the groups of telecommunication; pharmaceutical products and health services; and education remained stable in the reviewed period. The price of US dollar rose 0.33 percent, while the gold price climbed 0.61 percent against the previous month. Seminar discusses action plan for trade facilitation agreement A seminar discussing action plans for the implementation of the World Trade Organisation (WTO)’s Trade Facilitation Agreement (TFA) took place in Hanoi on November 29. The TFA was adopted by the WTO members at the Bali Ministerial Conference in 2013 and written into WTO rules 11 months later. The agreement aims to set out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues while enhancing technical support and capacity building in the area.     With three sections including 24 provisions, the TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also includes Category A commitments, which will be delivered immediately upon entry into force; Category B commitments, which can be delivered 2-3 years later; and Category C commitments, for which assistance and support are needed. As the TFA is to come into force, participants reviewed the final list of Category A commitments regarding complaint procedures, fees, consultation; reevaluated requirements in Category B and Category C commitments, said Director of the Vietnam General Department of Customs’ International Cooperation Department Nguyen Toan. Asked about e-payment for exports-imports, a senior expert from the World Bank said the use of credit or ATM cards is encouraged and non-obligatory. Several participants proposed Vietnam launch a national e-portal to update the public about trade facilitation issues. Vietnam was the 54th out of the 64 WTO members which approved the TFA. The agreement would come into effect when it was approved by at least two-thirds of the WTO members, or 108 member countries./ Long An rolls out red carpet for foreign investors The Mekong Delta province of Long An has taken many measures to improve its investment environment in order to attract foreign investors. According to Nguyen Van Duoc, Vice Chairman of the provincial People’s Committee, the FDI economic sector has not only directly contributed to the province’s economic growth but also created jobs for locals and those from other localities. The sector created a motive for the province to perfect its investment environment, policies and institutions, administrative procedures, infrastructure and human resources development, he said. According to a provincial report, Long An has had 828 registered FDI projects with a total capital of 5 billion USD. Of which, 459 projects have been put into operation, accounting for 60 percent, and FDI disbursement hit 3 billion USD, or 60 percent of total registered capital. The provincial Party Secretary Pham Van Ranh said Long An sets to become an industrialised province by 2020. It will build high-quality industrial parks to call for foreign investors and create key industrial sectors. Improving the investment environment is one of Long An’s focuses, he said, adding that the province makes specific annual plans on improving provincial competitive index and streamlines administrative procedures, especially those on land, tax and customs. In addition, the province will also concentrate on completing the infrastructure system, particularly transport, electricity and water to provide all necessary conditions for investment projects to effectively operate in the locality. According to Tran Van Can, Chairman of the Long An People’s Committee, the province pledges to create a favourable and healthy business environment for investors, especially foreign ones. However, investment projects must use environmentally friendly technologies, he noted. Long An currently has 28 industrial parks with a combined area of 10,220 hectares, of which 16 are operating with a occupancy rate of 61 percent. Besides, the province also has 32 industrial clusters covering 3,368 hectares, with 14 operational with an occupancy rate of 88 percent. Quang Ninh calls for Japanese city’s investment in agriculture The northern province of Quang Ninh has called on investors from Japan’s Asahikawa city to seek partnership with local firms, especially in agriculture. During a working session with a delegation of Asahikawa’s Government’s officials and businesses on November 28 in Quang Ninh, Dang Huy Hau, Vice Standing Chairman of the provincial People’s Committee introduced the economic and agricultural development in the province. He highlighted that Quang Ninh has a large market both at home and abroad for agricultural products, adding that local farm produces are diverse and abundant, especially aquatic products. Recently, the province has restructured its agriculture sector towards a goods-producing agriculture. However, production has yet to meet the market demands, he said. Hau attributed the situation to the small scale of agricultural production in the locality, along with poor technology, which forced local firms to export only raw material with low value. He underscored that Quang Ninh is keen on cooperating with businesses from countries with developed agriculture to help the locality boost sector’s growth to meet requirements of domestic and foreign markets. This is among priority of the province currently, he revealed. Hau noted that over the past years, Quang Ninh has partnered with a number of foreign firms, including those from Japan in producing safe agricultural products, which has seen a number of achievements. He held that the meeting is a good chance for agricultural enterprises in Quang Ninh to set up comprehensive and effective affiliation with their Japanese counterparts. He proposed that the Japanese Asahikawa delegation will support Quang Ninh’s firms in conducting joint projects in the locality. The Asahikawa delegation made fact-finding tours to Quang Ninh’s Hong Thai Tay high-tech agricultural production area to sea the current production technology in the site. Basing on what the Japanese firms have learnt during the visit, Hau suggested that the Japanese side design financial and human resources plan for cooperation projects, while implementing pilot projects in the field of agriculture in coordination with local firms of Quang Ninh, which will be expanded later. Earlier, the Asahikawa delegation also visited a number of agriculture firms, including Viet Long company, Song Hanh company in Quang Yen town, and Hoa Phong high quality agricultural product production cooperative in Dong Trieu town. On the framework of the visit, leaders and local businesses of Asahikawa city visited a number of markets and trade centres in the locality. Vietjet offers promotional air tickets New-age carrier Vietjet will bring out 1.5 million promotional tickets priced from only 0 USD at www.vietjetair.com on the occasion of its 5th anniversary “Sky Connection” concert in Ho Chi Minh City. The promotion, during the golden hours 12h to 14h daily from November 28 to December 11, 2016, applies for all domestic route within Vietnam and international ones connecting Ho Chi Minh City/Hanoi with Hong Kong, Busan, Seoul (the Republic of Korea), Taipei, Kaohsiung, Tainan, Taichung (Chinese Taiwan), Singapore, Bangkok (Thailand), Kuala Lumpur (Malaysia) and Yangon (Myanmar). Specially, the 50 first persons booking air tickets within the promotion time and making payment right away will win 50 free “Sky Connection” Concert tickets every day. The promotion applies for traveling from December 1, 2016 to March 25, 2017 (for domestic routes) and from December 1, 2016 to November 28, 2017 (for international routes) excluding national holidays. Promotional tickets are also available for booking at https://m.vietjetair.com (for smart phones) or at www.facebook.com/vietjetvietnam (just click the “Booking” tab). Payment can be easily made with debit and credit cards of Visa, MasterCard, JCB, KCP, and American Express and ATM cards issued by 29 Vietnam’s banks that have been registered with internet banking. The “Sky Connection” Concert will bring together multi-generational music idols performing on the same stage, and is the first event of its kind to be held in Vietnam. The event will also contrast the two unique and inspirational performance styles of two world class bands. The event features some of Vietnam’s top singers, including Thu Minh “Sexy Queen” and Son Tung M-TP “Vietnam Idol,” along with the appearance of Vietnamese top model Thanh Hang, supermodel Lan Khue and Miss Universe Vietnam Pham Huong. The concert was designed to be an astonishing gift to music lovers, and is held under the auspices of Vietjet’s 5th Anniversary. With its high-quality services, special low-fare tickets and diverse ticket classes, Vietjet offers its passengers enjoyable flights with dynamic and friendly flight crew, comfy seats, amazing hot meals and special surprises from the airline’s inflight activities. Vietjet is the first airline in Vietnam to operate as a new-age airline with low-cost and diversified services to meet customers’ demands. It provides not only transport services but also uses the latest e-commerce technologies to offer various products and services for consumers. The carrier recently became a fully-fledged member of International Air Transport Association (IATA) after receiving the IATA Operational Safety Audit (IOSA) certificate two years ago. Vietjet was also named as one of the Top 500 Brands in Asia 2016 by global marketing research company Nielsen and “Best Asian Low Cost Carrier” at the TTG Travel Awards 2015, which compiles votes from travelers, travel agencies and tour operators in throughout Asia. The airline was also rated as one of the top three fastest growing airline brands on Facebook in the world by Socialbakers. Currently, the airline boasts a fleet of 40 aircraft, including A320s and A321s, and operates 350 flights each day. It has already opened 53 routes in Vietnam and across the region to international destinations such as Thailand, Singapore, the Republic of Korea, Chinese Taiwan, China and Myanmar. It has carried nearly 30 million passengers to date. Research and innovation critical to future of support industries The Vietnam government has set a lofty target for exports of the electronics segment of the economy for both the foreign and domestic sectors operating within the country’s borders to reach US$40 billion by 2017. However, the development of the domestic electronics industry is still facing significant challenges says the Vietnam Electronics Industries Association as the segment is dominated in its entirety by the foreign sector. More than 90% of all sales – both local and overseas – are attributable to transnational electronics giants the likes of Samsung, Panasonic and LG with local companies largely non-existent in the segment’s support industry. The real challenge that lies ahead over the next decade is how to methodically go about increasing the participation of local companies in the segment’s support industry, said Le Ngoc Son - chair of the Association in a recent widely reported interview. Mr Son commented that, in his opinion, accomplishing the feat would require a great amount of international support in employee and business competitiveness training, technological investment, and refurbishing of manufacturing facilities. The problem is further compounded by the fact that the Government has given large foreign investors –especially those in the electronics segment – preferential incentives, such as it did with Intel in 2006, Samsung in 2010, and in recent years: Nokia, Bosch, and LG Group. It doesn’t provide these same incentives to local companies, Mr Son underscored. One of the benefits often touted in favour of providing foreign transnational companies like Intel, Samsung, Nokia and LG special favours are that they would help the domestic companies in moving from low-value-added to high-value-added manufacturing. Unfortunately, that has not transpired to date as the localization rate of the domestic sector in the electronics support industry is lacklustre, said Mr Son. A new research report by the Mitsubishi Research Institute of Japan backs up Mr Son’s views on the magnitude of the lack of competitiveness of domestic companies in the supporting industries in general in Vietnam. The report found that building the support industries of the future through enhanced productivity will require increased investment in research and development, a commitment to innovation, better links between business and research, focused international collaboration and the effective training and utilization of an innovation-capable workforce. The report commissioned by the Central Institute of Economic Management found that the success of the domestic sector in future manufacturing industries will depend largely on technological innovation, a shift to advanced manufacturing, integration with services, international connectedness and enhanced participation in global value chains. The report concluded that currently even domestic manufacturers prefer to purchase their components and other intermediary goods from overseas as opposed to purchasing them from local support industry manufacturers due to quality and other concerns. The report was rather blunt in its criticism, pointing out that collaboration among manufacturers in the country is largely non-existent, noting that even simple databases of the type normally found in all advanced economies such as those cataloguing businesses by industry type is lacking. A Samsung representative has asked the Government to focus on its underdeveloped electronics supporting industry as the huge transnational electronics company has plans to further expand its operations in the Southeast Asian nation. Currently, limited production capacity hinders the development of the supporting industry, said the report, noting that domestic sector businesses have only been able to perform simple jobs such as packaging and printing service for Samsung. To overcome these difficult challenging limitations, Dr Yoichi Sakurada from the Mitsubishi Research Institute makes some very important conclusions about measures to enhance innovation and therefore productivity. He said the report found that people and skills are key to innovation and investment in their development is lacking in Vietnam.  He noted that small business support centres provided by the Government to date have been largely ineffective. They have just provided information on policies, investment formalities, survey, organization of trade fairs and exhibitions. However, local businesses need much more support in terms of technique and technology. The Japanese expert suggested that successful innovation is driven not only by a mixture of technical and scientific skills, but also by business and entrepreneurial skills and by a culture that is conducive to innovation. Business support centres, he noted, should focus on improving their technical capacity by helping domestic sector companies in the support industries innovate, study and develop new technologies. Budget collection to be on schedule State budget collection will be completed in accordance with the yearly estimate set by the National Assembly, Deputy Finance Minister Huynh Quang Hai said at the Government’s regular metering on November 29. According to the deputy minister, the rate of State budget collection in the first 11 months of this year fulfilled 89.8 percent of the estimate, up 6.3 percent against the same period last year. The Ministry of Finance will work with relevant ministries and sectors to address difficulties and promote production, thus increasing the rate of budget collection. Inspection work will be intensified to prevent fraud, loss of revenue and cut down budget spending, towards balancing the State budget, Hai added. Regarding public expenditure for State officials’ travel, Hai said the ministry is working to consult about modifying regulations related to public cars, aiming to apply fixed expenditures and reduce the number of public cars. Bac Kan moves to turn Ba Be into national tourist site The northern province of Bac Kan aims to develop Ba Be into a national tourist site and make tourism a key sector, thereby boosting the locality’s socio-economic development. Accordingly, the province will develop comprehensive infrastructure, high-quality and diversified tourism products, brand names and high competitiveness. Efforts will be made to preserve and promote local historical values, cultural identity, thus improving the spiritual and material living conditions for residents while protecting natural resources and the environment. By 2030, the locality aims to draw 50,000 international tourists and 1.5 million domestic visitors, earn 4.2 trillion VND (184.8 million USD), and have 6,000 hotel rooms. The sector targets creating jobs for 27,000 labourers. According to Director of the provincial Department of Culture, Sports and Tourism Ha Van Truong, the sector will give priority to developing landscape and tourism products in Ba Be and nearby areas, such as caves, waterfalls, islands, traditional festivals and performances. Investment will also be poured into resorts, entertainment areas and extreme tours in the Ba Be National Park. From 2016 to 2030, nearly 9.4 trillion VND (413 million USD) will be earmarked for tourism development. The province will mobilise different resources for the sector, Truong said. Human resource training and publicity campaigns will be strengthened to enhance community awareness of the role of tourism in development. Promotion events will be conducted to foster links in tourism development. StanChart forecasts Vietnam dong to fall further against U.S. dollar Standard Chartered in a recent report forecast a further depreciation of the Vietnam dong on the broader U.S. dollar’s strength amid sharp rises of the greenback against other currencies, including the Chinese yuan. The bank revised up its exchange rate forecast to VND22,900 to the dollar at the end of this year from VND22,400 previously. The exchange rate is expected to stand at VND23,000 in the first quarter of 2017 and increase steadily to VND23,300 by the end of 2017. According to the report, among the broad-based move higher in dollar versus Asian currencies, the pace of the dong’s depreciation against the dollar has picked up recently. Having held within a relatively narrow range of over 100 basis points in January-August this year, the daily dollar-dong exchange rate fixings by the State Bank of Vietnam (SBV) then began to creep higher. The dollar-dong spot, on the other hand, held steady below VND22,500 per dollar for most of the year, until the past fortnight when it surged above that level and is now trading close to the 3% limit of the trading band. While Vietnam’s economy has been strong, the dollar-dong move echoes similar falls in other Asian currencies. This shows the dong is not immune to broader dollar strength following Trump’s election victory and the depreciation of China’s yuan. This is reminiscent of previous instances where a significant pick-up in yuan volatility has affected the dong. The dollar soared to the ceiling set by the SBV last Thursday and then dropped gradually to VND22,660-22,670 for buying and VND22,750-22,780 for selling. Vietcombank’s dollar buying and selling prices stood at VND22,660 and VND22,760 on November 28, down VND20 from the close last Friday. Meanwhile, the reference exchange rate between the two currencies was VND22,132 per dollar, a 1.1% pickup from VND21,890 early this year. With the trading band of 3% on either side, the dollar could be traded at between VND21,468 and VND22,796 at commercial banks. The dollar has weakened on global markets. According to Reuters news agency, the U.S. dollar index, which tracks the dollar against a basket of six major rivals, dipped to 100.66 on November 27, having soared to a 13-and-a-half year high of 102.05 on November 24. World trade pact to benefit VN       Implementation of the WTO Trade Facilitation Agreement (TFA) will help reduce about 20 per cent of business expenses as well as promote investment and create more jobs for Vietnamese. This was the assessment of Vu Ngoc Anh, Deputy General Director of the Viet Nam Customs, at a workshop yesterday held by the General Department of Viet Nam Customs (GDVC) with support from the United States Agency for International Development (USAID), and in co-operation with the World Bank. “Viet Nam Customs has made efforts to complete commitments, including on animal and plant quarantines, food safety and hygiene control, logistics services, and procedures for the clearance of goods,” Anh told the meeting. The TFA was passed at the 9th WTO Ministerial Conference in Indonesia on December 6 2013 after ten-year negotiations. In November 2015, Viet Nam became the 60th country to ratify the TFA, which will go into force when 109 out of 164 WTO member states ratify it. The commitments are divided into categories A, B, and C. “Viet Nam has already submitted to the WTO its Category A commitments, identifying those that can be implemented immediately upon the TFA coming into force,” Anh told the workshop. Once in effect, the TFA is expected to enhance national and business competitiveness and boost trade and investment by committing Viet Nam to reforms in support of trade facilitation. The workshop, which brought together more than 50 Government officials, completed reviewing the list of Category A commitments, and revalidated the B and C commitments to be implemented after the Agreement comes into effect. The action plan detailed activities, objectives and outputs for each commitment, along with the timeframe, needed technical assistance, responsibilities of each agency, and coordination mechanisms. The workshop was one of a number of activities on which the USAID Governance for Inclusive Growth (GIG) Program is collaborating with the General Department of Viet Nam Customs and other agencies to successfully implement the TFA. Oversight key to SOE reform     Strengthening financial supervision of State-owned enterprises (SOEs) is key to improving their performance and enhancing the efficiency of State investments, experts said yesterday. They told an international conference that this was particularly true in the context of the Government stepping up the SOE restructuring process. The conference, organised in Ha Noi by the finance ministries of Viet Nam and China, discussed the problems and difficulties faced by financial supervisory agencies and shared international experiences on improving supervision mechanisms. Vietnamese Deputy Minister of Finance, Nguyen Huu Chi, said that the financial supervision in SOEs in Viet Nam is a complicated, difficult process because of the large number of SOEs with investments spread over various industries and different bodies representing State ownership in the enterprises. As of early 2016, the Government has capital in more than 1,000 enterprises with total assets of VND3.1 quadrillion (US$136.6 billion). Of these, the State holds 100 per cent of capital in 781 enterprises. Chi said the complications as well as inefficient operations were among the main factors behind the wastage and loss of State-owned assets and investments. In 2014, pretax return on equity of State economic corporations and groups was 16 per cent, and that of enterprises under the ministry and provincial-level People’s Committees was 10 per cent. Supervision of State capital in SOEs has improved in recent years with the Government issuing and updating a number of policies to improve the supervisory mechanisms in a bid to limit risks of State capital losses, the conference heard. For State corporations and groups, the rights and responsibilities of the representatives of State ownership have been more clearly laid out. Management and supervision are carried out in tandem with performance evaluation of firms through various actions including the audit of financial statements, evaluation and classification of enterprises, regular inspections and monitoring of corporate finance. The Ministry of Finance, in co-ordination with other ministries and provincial authorities, has conducted annual reviews and assessments of financial status and performance of SOEs and reported to the Government. The Ministry will also use its assessments to give risk alerts and recommendations. Besides, the ministry has pointed out inadequacies and shortcomings in the current supervisory regime, including loose enforcement of regulations, overlap and dispersion in State management levels and lack of transparency in disclosures by firms, Chi said. Wen Zongyu, deputy director of the Research Institute for Fiscal Science of China’s Ministry of Finance, said SOEs had been playing a key role in the country’s economic reforms and they were expanding. He said Chinese SOEs were subject to public asset management, and had a tight relationship in the reform process, and the improvement of management mechanisms for State assets should be monitored in parallel with the SOE restructuring process. The management system needs to focus on effective financial supervision, as well as timely issuance and enforcement of policies to promote innovation within the enterprises, according to Wen. Record number of new firms set up     The number of newly-established firms in the past 11 months hit a five-year record high of 101,683 thanks to the Government’s incentive policies, the General Statistics Office (GSO) reported. The January-November period also saw another 24,560 firms, which had to close doors previously, resume operation, up 31.7 per cent year-on-year. It raised the country’s total firms that were either newly set up or resumed operation in the past 11 months to 126,200. On average, up to 382 new firms were set up per day during the period, GSO said. It exceeded the total of 94,754 new firms set up last year, GSO noted, adding that compared with 2012, the number even had doubled. “The sharp surge shows that new legal regulations and the Government’s solutions towards supporting and encouraging firms for development are taking effect,” GSO explained, adding that the number of newly-established firms rose in almost all sectors and industries. Total registered capital of the new firms also surged 48.1 per cent against the same period last year to VND797.7 trillion (US$35.29 billion). Average registered capital of a new firm was VND7.8 billion, up 26.5 per cent year-on-year. Several industries saw a robust surge in both the number of new firms and the registered capital, of which real estate reported a rise of 95.6 per cent and 221.2 per cent, information-communications up 13.8 per cent and 144.3 per cent, and finance-banking-insurance up 28.4 per cent and 91.8 per cent. The forestry-fishery sector reported a decline of 13.8 per cent in the number of newly-established firms in the past 11 months, however, registered capital of the firms increased 27.9 per cent. Art-recreation sector also saw a decline of 26.6 per cent and 13.8 per cent in terms of the number and the capital, respectively. In the past 11 months, however, the country also witnessed 10,468 firms dissolving, while another 54,046 firms had to cease operations temporarily. Top Thai expo organisers to come to Ha Noi     Ten leading Thai exhibition organisers will come to Hà Nội for a business-to-business forum to meet Vietnamese enterprises, trade promotion organisations and associations this Friday. The forum, organised by the Thailand Convention and Exhibition Bureau (TCEB), aims to boost trade activities between the two countries, as well as between other countries in the ASEAN region. The forum will discuss business opportunities within the ASEAN region through exhibitions in Thailand; commercial linkages among Thailand, Viet Nam and other countries in the region and from the establishment of the ASEAN Economic Community and the potential and cooperation opportunities between the two countries as well as ASEAN countries. This forum is a new form in the Connect Business campaign of TCEB. The bureau expects the campaign will attract Vietnamese businesses to Thailand to attend international exhibitions by strengthening relationships with organisations, associations, chambers of commerce, unions and non-profit corporations. Thailand expects to welcome 208,000 international trade visitors, creating a total value of US$500 million dollars this year and will continue to support businesses which want to expand their activities through exhibitions in Thailand. Lost oil and fuel duty revenue amounts to VND10 trillion by Oct The Government’s oil and fuel duty policy had led to revenue losses of about VND10 trillion in the year to October, says the General Department of Customs. The customs believes that apart from lost revenue from the world oil price plunge, sharp tariff cuts for fuel imports from a number of countries made up a significant proportion of the VND10 trillion. This is evident in the free trade agreements (FTA) such as Vietnam-South Korea and Vietnam-ASEAN. Importers have been shifting to buying fuels from those markets enjoying low Vietnam duties. Diesel oil 0.05S is mainly supplied by other Southeast Asia countries like Singapore, Malaysia and Thailand given a zero tariff under the Vietnam-ASEAN FTA. Meanwhile, diesel oil 0.05S imports from the Middle East are subject to a 7% duty and 5% from South Korea. Gasoline is mainly imported from South Korea thanks to a Vietnam tax of 10%, ten percentage points lower than in other markets. This is why Vietnam’s fuel imports from the markets enjoying the low tariffs account for over 80% of the total import of 9.53 million tons. Consumers have not benefited from 0% or 10% tariffs because the base fuel prices are currently calculated based on the average import price, tax and other charges, and used as a basis by traders to determine retail prices. Rules allow traders to set a price lower than the base level but 29 major fuel trading firms quote the same price using the benchmark set by Petrolimex which holds a market share of nearly 50%. Consumers actually have to buy fuels at high prices despite tax cuts. Stricter rule copes with bank card fraud Issuing banks must compensate for cardholders in five working days if they are found to be responsible for cash losses from cardholder accounts, according to a new central bank circular that went into force on November 28. The State Bank of Vietnam (SBV) last month issued Circular 30/2016/TT-NHNN in the wake of multiple reports on the disappearance of money from bank accounts, and on card fraud. The circular sets time limits for providers of payment services and intermediaries to investigate, handle and compensate for victims. Banks have so far dictated the time for dealing with customer complaints as the central bank’s Circular 19/2016/TT-NHNN allows the issuing bank and the cardholder to solve complaints based on their contract terms. With Circular 30 in effect, cardholders can request issuing banks to investigate any transactions and can lodge complaints within 60 days or more from the date of the transactions being done. In addition, the maximum time for banks to deal with such cases is no more than 45 working days from the date of receipt of the first request from the holder of the card having a BIN (bank identification number) granted by the SBV. For those with a BIN issued by international organizations, specific negotiations between card issuers and customers in their contracts should be referred to. A BIN is the initial four to six numbers on a card. On the event cardholders are not responsible for their money losses and/or such cases are not identified as force majeure in the contracts, banks must compensate for their customers under the agreement and the current law, within a maximum of five working days from the notification of investigation and complaint settlement results. If one of the parties involved are to blame (such as card switching or card accepting units), the party at fault must pay compensation to card issuers according to contract terms and the law. In case the time for investigation and complaint resolution specified in the contract has run out without a cause figured out, card issuers within the next 15 working days must discuss with cardholders over a solution or temporarily make up for their losses before a final conclusion by competent authorities determines which party is responsible. Circular 30 also provides other procedures, such as receipt of requests for investigation and complaints via a switchboard having a recording function and operating 24 hours, seven days a week, through transaction and business locations and in application of a form for investigation requests and complaints. Thaco exports bus parts to Russia Truong Hai Auto Corporation (Thaco) has exported three sets of bus parts to Russia to gauge the market there and if things go well, the local firm will ship 300 sets by the year-end, said Tran Ba Duong, chairman of Thaco. Speaking at a recent seminar on supporting industries in HCMC, Duong said the company is boosting the manufacture of auto parts to increase the local content of its vehicles to 40% and at the same time export some to foreign markets. Thaco now has four auto production and assembly plants and 16 auto parts factories. In April 2016, Thaco broke ground for a project to expand its automotive engineering complex Chu Lai-Truong Hai in Quang Nam Province to 268 hectares. The project includes a new passenger car factory with an annual capacity of up to 100,000 units. Thaco said the other factories would be able to turn out over 100,000 trucks, 12,000 minivans of 12-16 seats, and 8,000 bigger buses. As part of its business strategy, Thaco will expand Chu Lai-Truong Hai Port and establish shipping routes to ports in Japan, South Korea and China to cut shipping time and cost. According to experts, the auto industry holds huge potential but faces mounting competition as tariffs on completely-built-up autos imported from ASEAN nations will be cut to 0% in 2018. The production cost of autos in Vietnam is nearly 20% higher than in Thailand and Indonesia. Bắc Giang businesses owe VND100b in social insurance Social and health insurance for labourers worth VNĐ100 billion (US$ 4.4 million) hasn’t been paid by 600 businesses operating in northern Bắc Giang Province – accounting for 30 per cent of all businesses participating in the social and health insurance scheme. Some 190,000 labourers – 70 per cent of which are employed by businesses – are covered under obligatory social insurance. Some businesses have incurred a considerable amount of overdue social insurance debt, which proves increasingly difficult to recover, greatly impacting labourers’ interests. The provincial People’s Committee has directed all relevant agencies, departments and businesses to review and better comply with the implementation of the Law on Social Insurance, in addition to admonishing businesses with overdue debt and ensuring they make a binding commitment not to violate terms again. To deal with overdue debt, the provincial social insurance organisation shall inspect, classify and implement enforcement measures via bank accounts or request unions to initiate lawsuits if businesses deliberately evade insurance payment. With these measures, the province’s authorities expect to resolve outstanding insurance debts by 2017. State Bank set limits on credit card compensation     Credit card service providers will have to compensate card owners for any probable loss not caused by the owners, starting November 28, 2016. This is according to Circular No. 30 from the State Bank of Vietnam (SBV). Banks and other financial entities will have a maximum of five days from the announcement of the results of inspection based on the clients' claims to comply with the appropriate contract and legal procedure as stated in the recently issued circular, which includes several additions to regulations on payment and intermediate payment service in Viet Nam. In case the deadline for inspection of claim as stated in the card contract has already passed without a determined cause of loss or the party at fault, within the next 15 working days, the credit card issuer must negotiate with the card owner to find a solution or offer temporary compensation until a final decision is reached by the appropriate authorities on the fault and responsibility of each party. With regard to cheque service and usage, SBV stated there must be a concrete regulation on the time limit for clients to file a claim, which would be no less than 60 days since the cheque is presented for encashment. Meanwhile, the time limit for the cheque service provider to handle the said claim must be no more than 30 working days from receiving the client’s initial claim. For cases of legal breach, investigation must be undertaken by an authorised government agency, whereas cases where no legal breach is involved can be handled by the card issuer and the card owner alone. Circular No. 30 also deemed any probable loss due to concerned parties, such as intermediate payment organisations, international card organisations and card acceptance units, will have to be compensated by the said parties to the credit card issuers in accordance with a mutual agreement. Finance ministry steps up customs, tax reforms The deputy minister of finance urged the general departments of customs and taxation to further administrative reform efforts to facilitate businesses, which still have several questions about tax and customs procedures. “The Ministry of Finance is committed to hasten reforms of tax and customs policies aimed at creating the best business environment,” Vu Thi Mai said at the dialogue held by the ministry and the Viet Nam Chamber of Commerce and Industry (VCCI) yesterday in Ha Noi. The dialogue drew the participation of more than 400 companies and industry associations. Mai said the ministries welcomed all comments from businesses which would contribute significantly to improve policies. During the past five years, the finance ministry has broadened dialogues with businesses, aimed at providing them with updates to address their difficulties. According to VCCI’s Deputy Chairman Hoang Quang Phong, slow tax settlement and slow customs clearance were among the problems that businesses faced. Phong said dialogue and training of the updates to policies must be promoted in addition to transparency in tax and customs procedures. Cao Anh Tuan, deputy director of the General Department of Taxation, said tax policies had been amended to ensure they were appropriate with the global integration trend and the country’s economic development, and would contribute to removing difficulties for taxpayers, coupled with efforts for simplifying tax procedures. Accordingly, tax procedures had already been reduced from 385 to 300. E-tax declaration and payment were applied nationwide, which helped cut tax payment time from 537 hours in 2013 to current 117 hours. In addition, online tax refund was under the pilot phase and would soon be applied widely. Vu Ngoc Anh, deputy director of the General Department of Customs, said customs reforms were made towards facilitating import and export, implementing a national single window and improving transparency. At the dialogue, tax and customs official answered questions of businesses, related to special consumption tax, tax policies on automobiles and regulations on temporary import. According to Mai, the Ministry of Finance will work closely with relevant ministries and organisations to implement measures to support businesses. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR