BUSINESS IN BRIEF 12/9 HCMC calls for private investment in boat stops along Saigon River   The HCMC government is calling for private waterway transport and tourism services enterprises to invest in stops along the Saigon River to spur waterway tourism in the city. The municipal Departments of Transport and Planning-Architecture, and districts across the city are jointly drawing a plan to develop a waterway system and examine positions for such stops. Bach Dang Wharf on the Saigon River is considered the central station to serve passenger transport activities and waterway tourism. In addition, Nha Rong-Khanh Hoi Port, which is near Bach Dang Wharf, has good facilities and convenient traffic systems for passenger transport and tourism development. Relevant agencies proposed developing the port to cater to domestic and foreign passenger ships. However, the city has difficulty promoting waterway tourism due to a lack of connectivity between waterways and roads, and underdeveloped ports and wharfs. According to a waterway tourism development plan in the 2017-2020 period approved in June, the city will focus on waterway tourism promotion. Accordingly, at least seven waterway tourism routes will be launched in the Saigon, Dong Nai, Nha Be, Soai Rap and Long Tau rivers as well as canals in HCMC, including the Bach Dang-District 7 route, the route from Bach Dang Wharf to Tau Hu in districts 8 and 5, the Bach Dang-District 9 route, and the route from Bach Dang Wharf to Binh Quoi. The city targets to attract 450,000 tourists using waterway services next year and the number will increase 15% annually. Waterborne tourism is expected to fetch VND540 billion (US$24 million) in revenue this year. Nepal seeks tourism cooperation with HCM City Twenty-one Nepalese businesses operating in the aviation and tourism sectors recently visited Ho Chi Minh City to study potential tourism cooperation and sign agreements in this field with the locality. Nepal is home to eight of the ten highest mountains in the world, including Mount Everest, dubbed the “roof of the world,” along with many historical and religious relic sites.  Therefore, the focus of the tourism cooperation will be climbing and spiritual tourism.  Anil Lama, President of the Nepal Society of Travel and Tour Operators, said at an exchange programme in HCM City on September 10 that apart from exploring Mount Everest, visitors can take part in other activities like pilgrimages, boat rides and parachuting. Samsung, Panasonic face US$21mn in back taxes in Vietnam Samsung Vina Electronics and Panasonic AVC Vietnam may have to pay a combined total of over US$21 million in back taxes for incorrectly declaring imported liquid crystal (LC) films. The possibility is being considered by the Ho Chi Minh City Customs Department, which recently requested consultation with the General Department of Vietnam Customs in a dispatch discussing the issue. According to the dispatch, the two companies imported LC films worth a total taxable amount of VND16,056 billion (US$707.31 million). LC film is used in the production of liquid-crystal display (LCD) screens as well as LED displays, yet both firms declared it as zero-rated goods, attracting a favorable tax rate of zero percent. However, according to the municipal customs department, citing an earlier guideline by the General Department of Vietnam Customs, LC screens are listed in a three-percent tax category. Using this rate of tariff, both Samsung and Panasonic would have been taxed VND481.68 billion (US$21.18 million) on their imported LC films. The companies are refuting the suggestion, claiming that the guideline had only been circulated internally within customs agencies and not been made known to the public. Luu Manh Tuong, head of export-import tariff at the General Department of Vietnam Customs, told Tuoi Tre (Youth) newspaper Sunday, September 9, that it had reported the case to the Ministry of Finance and requested further instructions with regard to the potential collection of back taxes from both companies. Tuong said Samsung Vina Electronics and Panasonic AVC Vietnam would not be liable for the amount if they are not found to be at fault for the incorrect declaration. If that is the case, the companies would only need to ensure that future imports of LC films are declared under the new tariff rate, he added. Experts warn of high credit growth risks As the Government is striving to obtain credit growth of 20% to 22% this year, many economic experts voiced their concerns over possible adverse impacts of high credit growth on businesses and the economy. Speaking at a recent seminar organized by HSBC Vietnam Bank, Tran Dinh Thien, head of the Vietnam Economics Institute and a member of the Prime Minister’s economic advisory group, said the Government has raised this year’s credit growth goal from 18% to 20-22%, a record high in five or seven years. It is not difficult to obtain the target, but the Government should clarify the ultimate goal of the high credit growth, Thien said. Loan growth is supposed to speed up economic development. However, spurring credit up in the final months will not support gross domestic product (GDP) growth this year but in 2018. Meanwhile, next year could require different economic solutions. In addition, many enterprises are incapable of turning credit into business growth. Currently, the number of Vietnamese firms able to pay corporate income tax accounts for 33%, down sharply against several years ago, and meaning a vast number does not earn a profit. It is necessary to improve business efficiency first before credit growth could bring about positive results, the expert explained. Besides, high credit growth will place inflationary pressure on the economy. Credit growth may result in high inflation as seen five years ago, when large volumes of loans were injected into the economy. Therefore, the Government is recommended to maintain credit growth at 18% or below to avoid inflation risks. Besides, there is a high risk that credit would flow into the property sector. Speculation remains a big issue in Vietnam, so banks may provide huge capital for the stock market and the real estate sector to achieve high credit growth goals, the expert said. Ngo Dang Khoa, head of trading at HSBC Vietnam, said some VND600 trillion must be injected to the economy in the last four months of 2017 to obtain the credit growth rate of 20-22%. The nation has seen huge dong liquidity but mostly due to VND160 trillion the State Treasury is keeping at banks. Liquidity will decline as the State Treasury will speed up disbursement from now to the end of this year. To secure capital sources for reaching high credit growth, banks will have to hike interest rates to mobilize more from the public. Sustainable development in the future cannot be superseded by short-term growth, Khoa said. VN, South Africa discuss trade ties      The Vietnam Chamber of Commerce and Industry (VCCI) and the South African Embassy in Viet Nam held a conference yesterday in Ha Noi to discuss the promotion of bilateral trade, investment and tourism, and future potential between the two countries. Doan Duy Khuong, VCCI’s Vice Chairman, said during the conference’s opening speech that at the moment, Viet Nam is considered South Africa’s top strategic partner in the South East Asian region. Speaking at the conference, Helen Zille, Premier of the Western Cape Province in South Africa, said that she was delighted to see the two nations reaching new heights in their trade relations. Bilateral trade turnover between the two countries takes the lead among Viet Nam’s exports and imports with African partners; and South Africa is also considered Viet Nam’s hub to reach other African countries, as well as countries from the five major emerging national economies of Brazil, Russia, India, China and South Africa (BRICS), the G-20 and many other important international trade organisations, said Khuong. Over the past 10 years, total bilateral trade turnover between Viet Nam and South Africa has increased five times, from just over US$192 million in 2007 to over $1.03 billion as of the end of 2016; in which exports from Viet Nam to South Africa was worth more than $868 million last year, with imports at approximately $148 million, according to VCCI’s findings. Chief exports from Viet Nam to South Africa include mobile phone parts and accessories, computers, electronics devices, footwear, rice, pepper, cashews, coffee, and furniture. On the other hand, Viet Nam’s imports from South Africa chiefly range from industrial supply, textile materials, leather, chemical products, common metals and iron. Furthermore, in the past five months, South African firms have invested up to more than $100 billion into building infrastructure in Viet Nam, with hope of investing another $400 billion in the next 15 years. Zille expressed her delight at such progress, stating that it would be a good opportunity for Vietnamese businesses to enhance collaboration, and push for imports in more prospective goods such as coffee or industrial cement. She also stated that both Governments encourage firms to actively participate in maritime transportation and logistics to better facilitate bilateral trade. Simultaneously, she hoped that there would be better collaboration on human resource training and investment. The VCCI also said that between the two countries, some industries would have more room for growth than others, such as mining, iron and steel processing, mineral extraction, wood and pulp manufacturing. Viet Nam has been considering a more in depth cooperation with South Africa in the fields of thermoelectric power, automobile assembly, food processing, wine making and shale oil production. Yesterday’s conference also featured discussions on the potential for tourism between the two countries. It is seen as a great chance for businesses to meet, exchange information, build networks and establish partnerships on all trade, tourism, culture and education relations between the two nations. The conference was held on the occasion of Zille’s official visit to Viet Nam with 19 South African business delegates, working in various manufacturing industries ranging from household applications, electronic devices, coal, ore, canned goods to mining, wine making and water processing. Hanoi mulls 6 cross-river projects worth US$2.5bn The administration of Hanoi is seeking government approval for its development of six projects crossing the Red River and Duong River, costing a combined VND57 trillion (US$2.51 billion). The first one is the Tu Lien Bridge, which runs three kilometers across the Red River and connects Hanoi’s Tay Ho and Dong Anh Districts. The bridge is part of a nine-kilometer extension of the Hanoi – Thai Nguyen Expressway. The second project includes the construction of the Thuong Cat Bridge and its access roads, which stretch 5.2 kilometers from an intersection with Belt Road 3 in Bac Tu Liem District to the Bac Thang Long industrial zone in Dong Anh. Tran Hung Dao River Tunnel is the third project, running 3.1 kilometers from the border of Hoan Kiem and Hai Ba Trung Districts to Long Bien District on the other side of the Red River. In the fourth project, the second phase of the existing Vinh Tuy Bridge will be constructed, fully linking Vinh Tuy Ward in Hai Ba Trung District to Co Linh Street in Long Bien District. The Duong Bridge, measuring 1.4 kilometers in length, will be built across the Duong River, connecting Long Bien’s Duc Giang Ward with Yen Vien Town in Gia Lam District. The final project will see the construction of the 5.4-kilometer Giang Bien Bridge and its access roads, running through Long Bien and Gia Lam Districts. According to Hanoi’s administration, the proposed bridges and river tunnels would establish an inter-connection among its belt roads, and speed up the urbanization of its districts situated to the north of the Red River. Hanoi has also requested government permission to employ special mechanisms in calling for private investments in these projects. Winter crops to span 410,000 ha in northern region Northern provinces aim to cultivate the upcoming winter crop on 410,000 hectares, up 10,000 hectares from the same period last year. The cultivation is hoped to yield an average of 65-70 million VND (2,860 – 3,080 USD) per hectare, with total production value hitting up to 28 trillion VND (1.23 billion USD). Weather forecasts for the crop are favourable, with abundant water from reservoirs making up for limited rainfall. At a working session on the 2017 winter crop held by the Ministry of Agriculture and Rural Development on September 11, Nguyen Hong Son, head of the Cultivation Department, urged northern localities to use all necessary measures to attain the production area targeted. Son said apart from maize as the major plant for kernels and byproducts, attention should also be paid to fruit and vegetables with high commercial value. The northern winter crop plays an important role in the agriculture sector in Vietnam.  According to a report by the Cultivation Department, cultivation area of the crop last year shrunk compared from 2015, but returned higher revenue of 25 trillion VND (1.1 billion USD), an annual increase of 2.7 trillion VND (118.8 million USD). Innovation exchange launched to serve Industry 4.0 The Novelind innovation exchange was launched yesterday with that aim of connecting individuals, organisations and companies with scientists to serve community development. It has attracted the participation of more than 200 scientists from about 50 universities, research institutions and companies nationwide. Speaking at the opening ceremony, Dương Trọng Hải, Head of the Industry 4.0 Institution at Nguyễn Tất Thành University, and founder of the project, said that there was not yet a quality standard for research in Việt Nam. The Vietnamese economy requires initiatives serving Industry 4.0, however, the needs have not yet been satisfied. “Therefore, the exchange is a platform in which enterprises, authorities or individuals can seek initiatives by scientists. This is a stepping-stone in the formation of a technological ecosystem based on the three elements of Industry 4.0: research, education and manufacturing. Novelind is expected to create a technological market and favourable conditions to promote creativity and growth of enterprises, contributing to economic development,” said Hải. The exchange is also a destination for technological organisations to find the best technological solutions. Conversely, through Novelind, innovations developed by other individuals or agencies can be connected with those searching. Nguyễn Mạnh Hùng, Principal of Nguyễn Tất Thành University, highly appreciated the idea of Novelind. “It will be a huge success when the exchange attracts scientists in solving social issues. Therefore, Novelind needs the support from universities, research institutions and enterprises,” said Hùng. According to Nguyễn Xuân Hòai, Head of the Institute of IT Research and Development under Hà Nội University, the exchange needs to solve financial, legal, technological and communication challenges. It should be a fair ground which brings equal opportunities for all stake-holders. Vũ Anh Tuấn, Head of the Hoa Sen Group start-up community project, said that though it is an open space, the exchange should be transparent with an independent audit. It does not need rapid development but an excellent and socially-oriented management board.  G-bond capital disbursed slowly Capital mobilised from the issue of G-bonds in the first eight months of this year was very positive, however, it was quite a contrast to the disbursement of the capital source. According to the Ministry of Finance, total capital mobilised from G-bonds in the first eight months of this year reached nearly 144.1 trillion VND (6.34 billion USD). The amount was equal to 78.6 percent of the annual plan. However, unlike the success of the G-bond mobilisation, the disbursement of the capital source in the period was very slow. Just 2.46 trillion VND (108.37 million USD) was disbursed, equal to only 4.9 percent of the plan. Due to the slow disbursement of public investment, including G-bond capital, Prime Minister Nguyen Xuan Phuc had to ask authorities to take more drastic measures to rectify the late disbursement of investment capital for public projects. Thirty ministries and provinces reported the slow disbursement of public investment, mainly due to the lack of proper direction by heads of ministries and localities, in addition to inadequacies of related procedures, slow land clearance and limited capacity of project contractors. The PM noted that slow disbursement of public investment leads to a bottleneck in national economic growth and rising public debt. Vietnamese tea exporters enjoy robust achievements Vietnam’s tea exports in the first eight months of the year reached 90,000 tonnes, earning 142 million USD, up 12 percent in volume and 11.8 percent in value compared to the same time last year, according to the Vietnam Tea Association. Tea was sold at nearly 1,570 USD per ton on average, down 1.5 percent from last year. Pakistan imported the most tea from Vietnam. Other top tea consumption markets included India, the United Arab Emirates and Taiwan (China). Tea exporters said that there is an abundance of raw materials thanks to safe cultivation applied in all tea zones nationwide. Vietnam, South Africa seek to foster trade, investment ties A workshop was held in Hanoi on September 11 to further promote Vietnam-South Africa trade, investment and tourism cooperative relations.  In his opening speech, Doan Duy Khuong, Vice Chairman of the Vietnam Chamber of Commerce and Industry (VCCI), said Vietnam is now a leading partner of South Africa in Southeast Asia, with bilateral trade increasing fivefold in the past decade from 192 million USD in 2007 to 1.03 billion USD in 2016. Vietnam has mainly shipped phones and components, computers, electronic products, footwear, rice, cashew nuts, coffee and wooden products to South Africa, while imported plastics, garment-textile and footwear materials, chemical products, metals and steel from the African country, he said. Vietnam and South Africa still have potentials for stronger cooperation in such industrial sectors as mining, steel manufacturing, logging, and pulp producing. Vietnam is considering the possibility of partnership with South Africa in thermal power, auto production and assembly, foodstuff processing and beverages, among other sectors. Helen Zille, Premier of Western Cape province, who is leading a business delegation to Vietnam, expressed her delight at the fruits of Vietnam-South Africa trade ties, but saying that economic ties have yet to be on par with potentials and expectations of both nations. Zille suggested Vietnamese and South African enterprises work together to tackle difficulties in transport costs and regional economic downturn, and urged them to take the initiative in seeking partners. She said the two governments have encouraged cooperation between marine shipping and logistics firms to facilitate import and export activities.   The official said in the past five years, South Africa has invested more than 100 billion USD in infrastructure development and planned to pour an additional 400 billion USD into this field in the next 15 years. This will open up an opportunity for Vietnamese businesses to boost export of products such as cement, she added. Ca Mau works to promote fishery sector The Mekong Delta province of Ca Mau has applied a number of measures to boost the development of the local fishery sector as part of efforts to optimise local advantages. In implementing a project on restructuring the agriculture sector, with a breakthrough in shrimp farming, the province has encouraged locals to apply ecological shrimp farming models as well as models meeting international standards.  Ca Mau has also offered financial assistance to fishermen in building and upgrading vessels. The province currently has 91 vessels eligible for receiving the support. Commercial banks in the locality have to date signed lending contracts with 32 ship owners with total loans of 325 billion VND. Su Van Minh, Vice Chairman of the People’s Committee of Tran Van Thoi district, said the district has launched 18 ships newly built with the support, joining the fleet of 2,300 ships of the locality. Minh said that the locality will continue upgrading the capacity of the fleet, while setting up fishing cooperatives and multiply outstanding models in the field. According to the provincial People’s Committee, total seafood output of the province in the eight months of 2017 fetched 339,500 tonnes, equal to 64 percent of the yearly target, up 3.5 percent year on year, including 109,330 tonnes shrimps, a rise of 5.6 percent. Alongside, the province’s catch reached 137,200 tonnes, including 9,530 tonnes of shrimp. Total seafood exports of Ca Mau hit over 616 million USD. Japanese firms seek investment opportunities in Ha Nam A business delegation from Hyogo prefecture and Kobe city of Japan held a working session with leaders of northern Ha Nam province on September 11 to inquire about the local investment environment. Speaking at the event, Secretary of the provincial Party Committee Nguyen Dinh Khang said Ha Nam is now home to 60 Japanese firms, accounting for one-third of the total number of foreign-invested enterprises in the province, with a total registered capital of over 560 million USD, mostly in mechanical engineering, automobiles, motorbikes and supporting industry.  Ha Nam highly evaluated the competence and cooperation of Japanese businesses and expected more Japanese investors to carry out projects in the province, Khang said. Vice Chairman of the provincial People’s Committee Vu Dai Thang briefed the guests about the province’s economic potentials and investment attraction policies, with priority given to high-tech and supporting industries.  He said the Dong Van III industrial park with a favourable location and modern infrastructure is reserved for Japanese investors.  In agriculture, Ha Nam has advocated attracting investment in high-tech agricultural zones, apart from health care, education and training, and tourism, he said, adding that upon investing in the locality, businesses will receive assistance in electricity, water, workforce recruitment and security and order in line with the province’s 10 commitments to investors.  Shiro Muramoto, a special advisor of Kobe city’s commercial centre, said the visit aims to seek business opportunities in Ha Nam.  He said a number of firms in Kobe and Hyogo are interested in doing business in the province. APEC members discuss fostering small firms      Fostering micro, small and medium-sized enterprises is considered one of the keys to generating growth and innovation in the APEC region, heard a forum on start-ups and MSMEs held on Monday on the sidelines of the 24th APEC Small and Medium Enterprises Ministerial Meeting being held in HCM City. The forum was a platform for entrepreneurs, business experts, investors and regulators from APEC economies to discuss support for MSMEs and start-up businesses such as enabling them to innovate, integrate and access the global value chain right among other issues. It also enabled the APEC members to share experiences, ideas and tools to support businesses and start-ups to form a vibrant and networked bloc-wide community. There are 110 million MSMEs in APEC, accounting for 98 per cent of all business and 70 per cent of exports and employing 54 per cent of the population. Canadian ambassador to Viet Nam, Ping Kitnikone, said though MSMEs play an imporAPECtant role in the growth of all member economies, they are still facing many challenges as they tend to stay local and small. "Therefore, they need support to realise their growth potential such as on how to take risks, attract businesses, access regional and global markets." According to Hoang Van Dung, chairman of the APEC Business Advisory Council (ABAC), 75 per cent of Viet Nam’s companies are small or medium-sized, and they are facing difficulties in expanding and accessing finance and the global value chain. He made three recommendations to help grow MSMEs in the region, which will be submitted to the APEC Economic Leaders’ Meeting in November 2017 in Da Nang. He said the first is to enhance MSMEs global presence through the digital economy since "e-commerce and ICT services offer MSMEs opportunities to enhance competitiveness and innovation to further access international markets and overcome obstacles in trade." Second is to help MSMEs access finance as it is one of the biggest challenges preventing them from joining the global market, he said. He said one of the ways to resolve this problem is by APEC member economies engaging more in setting up financial services and enabling regional dialogues on fintech and finance education. Third is to foster women entrepreneurship by starting training courses to equip them with skills, enhance their capacity and networking to achieve leadership positions, especially economic roles, and connecting women entrepreneurs in the region to empower more women to build businesses, he said. Reports from the World Bank and ILO show that 47.4 per cent of women in the East Asia and Pacific region partly own firms as compared to the global average of 34.4 per cent. Though in Viet Nam there is 73 per cent participation in the labour force by women, the pay gap between men and women is large and widening. The forum resumes today with more round-table discussions on building a start-up eco-system, entrepreneurship education and training, and finance and business consultancy services for start-ups in the region. After the forum, a joint statement on promoting start-ups and MSMEs will be presented to the SME ministerial Meeting. APEC delegates discuss hurdles to supply chain finance      Providing micro, small and medium enterprises with access to financial services as a means of promoting inclusive and sustainable economic growth and employment is very important since they still find it difficult to get the financing they need to grow and create jobs, the APEC SME Finance Forum heard in HCM City on Monday. Nguyen Hoa Cuong, chair of the APEC SME Working Group and a senior official in the Ministry of Planning and Investment, said in his opening speech: “MSMEs stimulate domestic demand through job creation, innovation and competition, and are thus a driving force behind a resilient national economy. In addition, SMEs in global supply chains promote international trade. “Prioritising SMEs’ development is therefore critical for promoting inclusive economic growth. This priority for APEC 2017 will help maintain important momentum to advance APEC’s work with regard to MSMEs.” But lack of access to finance is a major barrier to their growth, he said. “Given the diversified nature of SMEs, there is no one-size-fits-all solution for SME finance. However lending sophistication and the diversification of financing modalities can help SMEs access the right type of finance for their evolving needs along their growth path.” Julius Caesar Parrenas, APFF coordinator, APEC Business Advisory Council, and senior advisor at the Japanese-based Nomura Research Institute, told Viet Nam News: “The traditional sources of finance have been banks, but it has been very difficult for SMEs to access finance through banks, mainly because most developing countries in the region do not have the financial infrastructure, a system to implement or credit information. “And so from the point of view of banks, it is very difficult for them to lend to SMEs because of the risks involved due to the underdevelopment of the financial market infrastructure. “Now that is being addressed and APEC is doing a lot about it, but in the meantime the question is: what are the sources we can tap to finance SMEs? “And so we are looking at the innovation space. There has been a lot of innovation in the financial sector, which opens up a lot of opportunities for SMEs to access finance.” At the first session of the forum, titled “Challenges of SME finance and the recent innovations around the Asia Pacific region”, speakers reflected on the difficulties faced by SMEs in obtaining funding and took stock of significant recent innovations in the region, especially in digital finance, and discussed the associated challenges. How to organise and optimise receivables and inventory finance by leveraging the chain relationships and the role of supply chain finance in the SME finance market were also highlighted. A session on “Scaling up supply chain finance to strengthen SME competitiveness and innovation” reviewed the developments in supply chain finance in the Asia-Pacific region. It discussed the main lessons from developing a sustainable and inclusive supply chain finance market, the value-addition that supply chain finance provides in building competitive eco-systems, whether supply chain finance benefits SMEs to the desired extent, how supply chain finance can be best used to strengthen SME competitiveness and innovation, and how APEC economies can leverage more cross-border supply chain finance to deepen regional economic integration. At another session on “Developing electronic supply chain finance platforms in the digital age”, delegates discussed the increasing movement of supply chains online together with their financial institutions, as a result of which electronic supply chain finance platforms have emerged strongly in some markets. They also discussed if these platforms have fulfilled their promises in general, made supply chain finance easier and cheaper for SMEs with the digital channels and helped more SMEs participate effectively in global and regional supply chains. The last part of the forum, a panel discussion, considered the way forward and what more could be done to promote the development of supply chain finance and electronic supply chain finance platforms. Delegates heard that these could involve further policy and regulatory reforms and sector capacity building or at the level of specific supply chain finance providers.  Japanese firm gets customs priority status      The General Department of Customs (GDC) has recognised Japanese printer manufacturer Fuji Xerox Hai Phong Co Ltd in the northern port city of Hai Phong, as a priority enterprise. This status gives the company access to special customs incentives, which will enable the firm to conduct fewer procedures, get tax refunds first while checking is performed later, have goods cleared quickly and establish a single goods declaration system for multiple exports and imports. Under Circular 72/2015/TT-BTC, regulating the application of a priority policy for customs procedures, customs inspection and the supervision of exported and imported goods by enterprises, businesses need to have more than US$100 million worth of export and import turnover per year to be considered a priority enterprise. The conditional annual export revenue of an agricultural and fisheries company is $30 million. Meanwhile, companies that manufacture goods for export in Viet Nam can be considered for this status if they earn $40 million in revenue per year. According to the GDC, priority enterprise status applied for Fuji Xerox would last for three years. If this term expires but the company still meets the required conditions, the term can be extended. Fuji Xerox Hai Phong was established in VSIP Hai Phong Industrial Zone in Thuy Nguyen District in 2012 with a capital of $36 million, making it one of the largest foreign direct investment companies in the city. The company specialises in the manufacture and export of laser printers, digital electronic copiers, laser scanners, and related components. The number of employees at the company as of August 2016 was 2,200. Eight enterprises currently enjoy priority status for customs in Hai Phong. According to the post-clearance audit unit under the GDC, some 63 companies in Viet Nam are presently making use of this policy.  State budget collection up 13 per cent Total State budget collection in the first eight months of this year was estimated at VNĐ762.8 trillion (US$33.4 billion), an increase of 12.8 per cent over the same period last year. The amount is equivalent to 63 per cent of the whole year’s estimates, according to the Ministry of Finance. In the reviewed period, domestic collection reached VNĐ603.6 trillion, up 10.7 per cent year-on-year, accounting for 61 per cent of the year’s estimates. The ministry said budget revenues from crude oil exports, estimated at roughly VNĐ29.97 trillion, met 78.3 per cent of estimates, up 11.3 per cent over the same period in 2016. Import-export activities contributed VNĐ190.8 trillion to the State budget, an increase of 9.5 year-on-year and equaling 66.9 per cent of projected revenues. According to the ministry, total budget spending was VNĐ793.5 trillion, up 7.8 per cent year-on-year, completing 57.1 per cent of the yearly target. Of the estimate, budget investment for development was VNĐ137 trillion. Regular expenditures in eight months were estimated at VNĐ585 trillion, equaling 65 per cent of the year’s estimate, up 7.4 per cent over the same period last year. Debt payment and interest expenses during the period totaled VNĐ68 trillion, meeting 68.9 per cent of annual target and increasing by 14.6 per cent year-on-year. SeABank and BRG Group receive ASEAN awards      The Southeast Asia Commercial Joint Stock Bank (SeABank) was recently honoured by the ASEAN Business Awards (ABA) for its social responsibility. SeABank received the honour in the award category “SME Corporate Social Responsibility” at the ABA in Solaire Pasay City, Philippines. The awards were first organised by the ASEAN Business Advisory Council (ASEAN BAC) in 2007 with the goal of recognising businesses that contribute to socio-economic development, work with governments to stabilise the macro-economy and enhance the competitive capacity of the ASEAN business community in the world market. Additionally, Le Thu Thuy, BRG Group vice chairwoman and standing vice chairwoman of SeABank’s management board, was the only Vietnamese honoured with the Legacy Award, which is given to an iconic entrepreneur from each country in ASEAN. Tra fish fair to take place in October      The tra fish and Vietnamese seafood product fair will be held from October 6 to 8 at the Agricultural Exhibition Centre in Ha Noi’s Cau Giay District. The fair is an opportunity for businesses, distributors and consumers to popularise their images and brand names, promote consumption of tra fish and fish products in the domestic market in general and the northern market in particular, and boost the expansion of international and regional markets, partcicularly the Chinese market. In addition, it is also a chance for businesses to expand, connecting distributors, supermarkets and consumers inside and outside the country. The fair is expected to attract over 100 booths of domestic and foreign enterprises, showcasing seafood products such as tra fish, value added products and auxiliary products for tra fish production and other key Vietnamese seafood items. Tran Dinh Luan, deputy general director of Directorate of Fisheries, said the tra fish products exhibited at this fair must be fully labeled and the origin should be easy to trace. The fisheries directorate will support to expand distribution channels to consumers via wholesale and retail centres in the north, thereby boosting sales in the potential domestic market of 92 million people, Luan added. Under the framework of the tra fish and Vietnamese seafood product fair this year, three main events will take place -- a workshop on tra fish production and consumption, an exhibition with over 100 booths and a cuisine programme introducing dishes made from tra fish by famous chefs. Quang Ninh’s efforts pay off in improving competitiveness Unceasing efforts have helped Quang Ninh continue to rise in the ranking of provincial competitiveness index (PCI), from the fifth place in 2014 to the third position in 2015 and the second place in 2016. The northern coastal province particularly recorded remarkable improvements in the sub-indices of entry costs for business startup, informal charge, transparent business environment, proactive and creative provincial leadership, and business support services. Chairman of the provincial People’s Committee Nguyen Duc Long affirmed that the province has made uninterrupted efforts over the past four years to improve its PCI ranking. Quang Ninh’s position among the top five localities reflected the active involvement of the entire political system in the province. According to the chairman, Quang Ninh has developed its own Department and District Competition Index (DDCI), which contributed to enhancing the competition capacity of local agencies and authorities and was applauded by the business community. Chairman of Texhong group Hong Tianzhu said the group chose Quang Ninh for its investment as it received attention and timely support of the local authority, as seen through the rapid land clearance and technical infrastructure building. The group was also satisfied with the short duration of dealing with administrative procedures. In 2017, Quang Ninh attracted a series of tourism projects from major economic groups such as Sun Group, Vingroup and FLC, with total investment capital amounting to 100 trillion VND. The province is accelerating the pace of several transport plans to create stronger momentum for economic activities, such as a highway connecting to the Hanoi-Hai Phong highway, the Van Don international airport and the Van Don special administrative-economic zone. Quang Ninh has emerged as a cradle of daring ideas and reform models, said Vu Tien Loc, Chairman of the Vietnam Chamber of Commerce and Industry (VCCI). He cited as examples the building of a public administrative centre to improve public services and the establishment of an independent investment promotion agency. The province has also been able to get the community and businesses involved in reform efforts by giving them the power to assess the performance of management agencies and authorities through the DDCI. As early as 2015, Quang Ninh deployed the model “Business cafe” which sought to connect State management agencies and enterprises and provide a venue for interaction and open talks between authorities and business community. The model proved to be a success in bringing authorities and businesses closer and promote dialogue between the sides. The provincial authorities have also been holding quarterly discussions with the business community, while assigning People’s Committees at lower levels to hold regular meetings with local enterprises in order to timely address their problems. Chairman of the Quang Ninh Business Association Pham Van The said the meetings at local level give more firms the opportunities to come face-to-face with relevant agencies and have their difficulties heard. In order to maintain its high ranking in the national PCI, Quang Ninh is aware that there is more it has to do. The province can be considered a model of success thanks to its strong shift in the way of thinking, from managing to serving the business community and considering businesses as long-term cooperative partners in local economic development. Quang Ninh drew in more than 47 million USD in foreign direct investment (FDI) in the first six months of 2017. The sum came from two new and six existing projects, raising the number of valid FDI projects in the province to 58, with total registered capital worth over 2.3 billion USD.  The gross regional domestic product (GRDP) of the province expanded by 9.6 percent in the first half of this year as compared with 9.2 percent in the same period last year.  In the first quarter, the province’s GRDP grew 8.3 percent while the figure recorded in the second quarter was 10.7 percent, the fastest pace since 2012.  With the performance, Quang Ninh has been listed as one of the leading cities and provinces in the northern key economic region and nationwide as well.  In order to reach the target of a 10 percent growth rate, the province will focus on drastically instructing the implementation of socio-economic development tasks and solutions set for 2017. VinaCapital follows up strategy by divesting Vina Square VinaLand, the real estate arm of VinaCapital, has announced divesting its stake in the Vina Square project located in Ho Chi Minh City. Vina Square has a total land area of approximately three hectares and was acquired by VinaLand in 2007, when the land was designated as a future development site.  VinaLand is divesting its entire stake in the project to Tri Duc Real Estate Company Limited, a Vietnamese development company for net cash proceeds of approximately $41.2 million, including the repayment of shareholder loans, resulting in an IRR of 3.3 per cent to VinaLand. The total valuation is recorded at 0.3 per cent above the June 30, 2017 unaudited net asset value and 13.5 per cent above the unaudited net asset value at the time of VinaLand’s extraordinary meeting in November 2016. Both figures include adjustments for additional investments up to the date of exit. At the time of this announcement, $41.0 million or 99.5 per cent of the net proceeds have been received by VinaLand. It is expected that the full proceeds will be received by the end of this month.   Speaking of the transaction, managing director David Blackhall stated that, “This divestment is in accordance with the current policy to divest projects in a controlled and orderly manner, and steady progress has been made with further pipeline disposals.”  “The proceeds received from this disposal will, in conjunction with collections from earlier disposals including prepayment advances for future pipeline disposals, will be used to cover VinaLand’s commitments on operating costs, capital contributions, and further distributions to shareholders," he said. AgriTech accelerator for Mekong Sub-region launched A new agritech accelerator will harness entrepreneurship and technology to transform the Mekong region’s agricultural industry into a leading global supplier of “safe and nutritious food for all”. The MATCh: The Mekong Agriculture Technology Challenge Startup Accelerator will support startups in agriculture to develop their products, network and learn from industry players, showcase their solutions, and access markets and funding. It is aimed at innovative early stage agritech startups and traditional agriculture businesses with new, scalable business models in Cambodia, Laos, Myanmar, and Vietnam. “MATCh is an important initiative, as entrepreneurship and technology are key to enhancing the competitiveness, inclusiveness, and sustainability of the Mekong region’s agricultural industry,” said Mr. San Vanty, Under Secretary of State at Cambodia’s Ministry of Agriculture, Forestry, and Fisheries. An additional MATCh Market Access Accelerator will help mature international agritech companies to expand into the Mekong region. Participants will receive mentorship and assistance with their expansion plans, including product adaptation, and forge relationships with potential partners and investors in the region. MATCh will provide awards and prizes to winners of the two accelerators, with awards given for Best Startup, Most Innovative, Biggest Social Impact, and Women’s Leadership. Award winners will be showcased at the 2018 Greater Mekong Sub-region Leaders’ Summit in Hanoi and participate in the Future Food Asia Award Competition in Singapore. MATCh was launched at the Second Greater Mekong Sub-region Agriculture Ministers’ Meeting (AMM) in Siem Reap, Cambodia. It is the latest in a series of innovation accelerators by the Mekong Business Initiative (MBI), which also pioneered the MIST (Mekong Innovative Startup Tourism) accelerator earlier this year. MBI launched MATCh with funding and support from the Australian Government and the Asian Development Bank. “By supporting the innovative business models that this program will create, we can promote efficacy enhancing and environmentally-friendly agricultural technologies that also improve farmer livelihoods,” said Mr. Dominic Mellor, Senior Economist at the Asian Development Bank and Head of MBI. “Future Food Asia, the open innovation platform developed by ID Capital, is partnering with MBI in MATCh because we share a common vision of fostering startup-driven innovations to bring more sustainability in the food system in the Asia-Pacific region,” said Ms. Isabelle Decider, CEO of ID Capital. The Asian Development Bank and the Australian Government jointly launched the MBI in 2015. It catalyzes private sector development in emerging ASEAN markets, focusing on Cambodia, Laos, Myanmar, and Vietnam. The program aims to improve the business-enabling environment in these four emerging ASEAN markets, with particular focus on business advocacy, alternative finance, and innovation. Philippines' AC Energy keen on renewables in Vietnam AC Energy Holdings Inc., the power generation unit of conglomerate Ayala Corp., has unveiled a plan to build renewable energy plants with a combined capacity of several hundred megawatts in Vietnam over the next two to three years. AC Energy’s President Mr. John Eric Francia said the company was in talks with several potential partners in Vietnam to implement the strategy. The move to look for potential renewable projects in Vietnam is part of its thrust to reach 2,000 MW of attributable capacity by 2020, with half coming from renewable energy projects. Mr. Francia said that while the company was open to all types of technologies, it was keenly interested in renewable energy. “The market in Vietnam is growing in the double digits and my view is that there is a need for greater supply,” he said. “They have no reserve margin with double digit growth, so are in need of additional investment.” Affirming that Vietnam was offering positive investment opportunities, he said he was hoping that a deal would be finalized soon. “We are trying our best,” he said. Currently with 1,300 MW of capacity, including 300 MW of renewable energy, AC Energy recently acquired Bronzeoak Clean Energy, one of the leading renewable energy developers, having built over 250 MW of solar and biomass projects, as well as San Carlos Clean Energy. Ayala Corp., the Philippines’ oldest conglomerate, entered Vietnam in 2008 through its subsidiary Manila Water’s $44-million water loss reduction project in Ho Chi Minh City. It became a strategic investor in the Ho Chi Minh City Infrastructure Investment Joint Stock Co. (CII), the leading infrastructure developer in the southern city, in 2012, and now holds an 8.8 per cent stake in CII via its unit VIP Infrastructure Holdings Pte. Ltd. Through Manila Water, Ayala now owns a 38 per cent stake in Saigon Water Infrastructure JSC (SII). Vietnam is trying to generate enough energy to sustain the country’s growth and to connect the millions of people who still do not have access to power, while gradually shifting towards clean and low-carbon energy. Last year, the government revised down its output target for coal-fired power plants to 53.2 per cent of the country’s total power generation by 2030 from the previous 56.4 per cent. The country is aiming to produce 10.7 per cent of its total electricity through renewable energy by 2030, mainly through solar and wind energy, up from 6 per cent previously. In May this year, the government issued long-anticipated regulations on solar energy projects. A raft of incentives to support renewable energy will be in place to June 2019 and have been dubbed a “landmark” in the country’s solar energy outlook. Other than exemptions on import duties and incentives including breaks in taxes and land use fees for solar power projects, raising the bid price to purchase solar energy to 9.35 US cents per kWh is a key measure. Most recently, the Ministry of Industry and Trade has asked the government to raise the buying price for wind power in an effort to help investors cover high input costs, suggesting that the price should be lifted to 8.7 US cents per kWh for wind energy projects on land and 9.95 US cents per kWh for offshore plants. Since 2011, the buying price for wind energy has stood at 7.8 US cents for all land-based projects in Vietnam, with 6.8 US cents paid by State-run power monopoly Electricity of Vietnam (EVN), and the remainder coming from the country’s Environment Protection Fund. For the country’s only offshore plant, in the Mekong Delta province of Bac Lieu, the current price is 9.8 US cents per kWh. Appropriate growth plan considered for 2018 The Ministry of Planning and Investment (MPI) has outlined three scenarios for economic growth in 2018, in preparation for the next year's socio-economic development plan with GDP growth expected to be at 6.4-6.8%. According to the Head of MPI’s Department for National Economic Issues Tran Quoc Phuong, the three scenarios for the 2018 development plan were developed by the MPI on the basis of the estimates made in 2017, forecasts for the global and domestic economy in 2018, and taking into account the objectives of the five-year, socio-economic, development plan during 2016-2020, as well as the direction given by the Prime Minister on the development of the socio-economic development plan for 2018, with expected GDP growth at 6.4-6.8%. The MPI also set a forecast economic growth target of 6.7% for 2017, which is considered to be "achievable", and formally reported to the Government on three economic growth scenarios for 2018. In particular, in a low growth scenario, GDP is expected to grow by 6.4%; in an average scenario, the growth rate will stand at 6.5%; and in the high scenario, the growth rate is expected to be 6.81%. The three scenarios have been developed but amidst the projection for 2018 and the following years, in which the mining sector may continue to decline which will affect the country's growth and while the current economic model cannot move right away, the MPI believes that in the above scenarios, the medium scenario is the most suitable option. This proposal has also received the support of many cabinet members. It is likely that the 2018 socio-economic development plan will be developed with a GDP growth target of 6.5%, a reasonable growth rate. In addition to setting growth targets for the coming year, the focus of socio-economic development in 2018 is consistently identified as "ensuring macroeconomic stability, controlling inflation and creating a stable foundation for economic development," Tran Quoc Phuong added. Meanwhile, the 2018 plan also targets moving gradually towards the implementation of economic restructuring and deploying three strategic breakthroughs in order to create new growth engines, thereby re-impacting and creating macroeconomic stability on a higher scale and level. In addition, it aims to continue to promote the growth of relevant sectors and branches, creating favourable conditions for economic development in the following years, and striving to achieve the five-year, socio-economic, development plan's objectives set for 2016-2020. Although there are positive and optimistic signals for the economy in 2018, it cannot be denied that a number of difficulties and challenges are waiting ahead. One of the most visible challenges is the possibility of achieving a 6.7% growth target this year. If this target is not met, it will affect the set achievement for implementing the economic growth target for the coming year. Therefore, during the regular government monthly meeting for August 2017, the Prime Minister repeatedly emphasised that: "All ministries, sectors, localities and corporations must continue to scrutinise again the set target and drastically strive to fulfill it. Industry, agriculture and services, including tourism, should remain focused; if lagging behind for even one month, the 6.7% target may not be met.” According to the MPI, the difficulties and challenges for 2018, besides the objective factors, are also issues related to the internal weaknesses of the economy, including the economic model being based mainly on cheap labour and at a low-tech level; land and natural resources are gradually depleting, while the efficiency of land use has not increased significantly; whilst domestic enterprises are still limited in terms of scale and operating capacity, leading to restrictions in competitiveness. In addition, new difficulties may also arise, as the synergy for economic growth provided by oil, gas and coal, and Samsung's contribution and remittances are leveraged and unlikely to increase. This issue, in combination with a limited fiscal and monetary policy and difficulty in raising capital for development, will have a significant impact on the 2018 economic growth. In this regard, Director of Central Institute for Economic Management Nguyen Dinh Cung said that the growth of the economy relies heavily on the development of the business sector, but the private sector still faces many difficulties. According to statistics, only one third of private enterprises are profitable. If in next year the salary rate and a series of costs increase, they would affect the business efficiency of this sector; therefore, the number of profitable enterprises would reduce and thus affect economic growth. It is necessary to reconsider the economic efficiency of the "steel fists" of the economy – State-owned corporations, at least to review the business performance of 30 SOEs. In the assigning of next year’s tasks for these units, it should not be in the direction of exploiting how many tonnes of oil or coal, but how much profit and how much the profit rate is, which means focusing more on quality. In addition, the proposal to increase the value added tax (VAT) at this time is also stirring social concerns. This issue should be thoroughly considered and calculated to choose the most appropriate option. Regarding the VAT increase, Tran Quoc Phuong said that the MPI, when reporting the issue to the Government, mentioned that the VAT increase in the time ahead should be thoroughly researched and include an impact assessment for State budget collection, as well as impact on the consumption of the entire population, especially those with low income, on production costs of enterprises, and on labour and employment. Vietnam Railways proposes over VND4.6 trillion investment in modernisation Vietnam Railways (VNR) has proposed an investment of over VND4.6 trillion (US$202.4 million) in order to buy new locomotives and carriages by 2020, with 70% of the total amount to be borrowed from the State-owned Vietnam Development Bank. According to the document sent to the Ministry of Transport, VNR intends to gradually replace technologically backward locomotives, coaches, and waggons with modern ones by 2020 in a bid to reduce costs, improve efficiency and increase the competitiveness of rail transportation. Specifically, VNR will buy 100 new locomotives worth over VND2.1 trillion, 150 passenger coaches worth over VND1.6 trillion, 300 container waggons worth VND270 billion, and 500 waggons, with speeds below 60km per hour, worth VND550 billion. Approximately 70% of the total investment (VND3.2 trillion) is proposed to be borrowed from Vietnam Development Bank, while 30% of the investment will be counterpart funded from the VNR, Hanoi Railway and Saigon Railway. VNR said that it wants to receive the loan from the State-owned Vietnam Development Bank, as the interest rate for investment projects is stable and the borrowing period is lengthy, while enterprises can use assets formed from loans as collateral assets. Meanwhile, loans from commercial banks will bear higher rates in addition to a shorter borrowing period, resulting in low business efficiency, VNR noted. However, it is difficult for VNR to gain access to loans from the Vietnam Development Bank as VNR's projects are not subject to loans from the bank. Based on the provisions of Articles 5 and 6 of the amended Railways Law 2017, the VNR will be provided with preferential credit from the State's investment credit or provided with loans guaranteed by the Government. But, the Railways Law 2017 will not begin to come into force until July 1, 2018. Therefore, VNR has asked the Ministry of Transport to report to the Government for approval of the loans from the Vietnam Development Bank in order to timely meet the investment requirements in infrastructure development. VNR pledged to fully comply with the loan procedures and to perform the obligation to pay principal and interest in accordance with the terms of the loan agreement. Railway industry needs $205 million to renew locomotives, coaches Vietnam Railways has proposed the Ministry of Transport to permit it to get loans from Vietnam Development Bank (VDB) to buy new locomotives and coaches with the total investment capital of VND4,658 billion (US$205 million). The corporation is expected to buy 100 new locomotives, 150 passenger coaches, 300 container coaches and 500 coaches having the speed of less than 60 kilometers an hour to gradually replace old and downgraded coaches from now until 2020. Of the total funds, nearly VND1,398 billion accounting for 30 percent will be reciprocal capital from Vietnam Railways, Saigon and Hanoi Railway Transport Companies. The remaining amount accounting for 70 percent will be bank loans. The investment aims at raising the competitive ability of railway compared to other types of transport. Vietnam Railways says that the project is not subject to borrowers of VDB. According to Articles 5 and 6 of the revised Railway Law 2017, the corporation can get preferential credit source of the state or receive Government’s loan guarantee for the project. However, the law will take effect on July 1, 2018. Therefore, Vietnam Railways has proposed the Ministry of Transport to report to the Government, permitting the railway industry’s investment projects to get loans from VDB so that they will be invested in a timely manner. Massimo Dutti opens first store in Vietnam Massimo Dutti last Friday opened its first store on the first floor of Vincom Center on Dong Khoi Street in District 1, HCMC. Massimo Dutti was present for the first time in the fashion industry in 1985. In 1991, it was acquired by the Inditex Group. In 2003, Massimo Dutti launched a children’s fashion line under the name Boys and Girls. Currently, the brand boasts more than 775 stores in 73 countries around the world. HCMC wants to lure more Chinese tourists Travel companies in HCMC want to woo more Chinese tourists in the coming time to help boost international arrivals to the city and revenue from tourism. At a seminar on solutions to attract Chinese tourists to HCMC held by the municipal Department of Tourism last week, Phan Xuan Anh, chairman of Viet Excursions, said the city holds high potential to attract Chinese tourists, but it should focus on high-spending visitors. HCMC is not as popular as Nha Trang, Hanoi, Halong Bay and Danang among Chinese tourists. Last year, Vietnam welcomed more than 2.69 million Chinese visitors, surging 51.4% versus 2015, but only 400,000 of them came to HCMC, increasing 37.4% year-on-year.  Tourists from the neighboring country are keen on sea travel. Services in Can Gio or Vung Tau can satisfy these requirements. At the seminar, some Chinese experts also provide information about tourist sources, and their hobbies and ways to get tourism information. The city should seek guests from Beijing, Shanghai, Fujian and Guangdong, and other eastern coastal provinces of China who have high demand for overseas travel. According to the Vietnam National Administration of Tourism, Chinese tourists to Vietnam can increase by 1.3 million to four million this year. At present, a huge number of Chinese travel to Nha Trang, Danang and Phu Quoc on chartered flights. Air service between Cam Ranh and Seoul to be launched Representatives of Nha Trang-Khanh Hoa Tourism Association and South Korea’s Jeju Air struck a deal last week to launch a tourism air service connecting Cam Ranh Peninsula in the south-central coast province of Khanh Hoa and the Korean capital Seoul. The service will be launched late this year, with a flight frequency of one trip a day. Each trip will take around five hours. The association will work with local tour operators and hotels to develop services and manpower to serve Korean tourists, as well as to create favorable conditions for Vietnamese to visit the Northeast Asian nation. Earlier, the association has carried out a survey of the South Korean market, and found out that it has great potential for growth. This is why it teams up with the Korean partner to prop up tourism. The move is to diversify source markets for Khanh Hoa’s tourism sector, in addition to China and Russia. On Thursday, the province launched a direct air service to Malaysia. Therefore, some companies are preparing travel programs, including tours to Dalat City of Lam Dong Province, to serve Malaysian tourists. “We are in preparation for the first group of Malaysia tourists to Khanh Hoa, thanks to the direct air service. The tourists will enjoy four days in Dalat and Nha Trang,” said Giang Loi Khon from Hong Thai Travel Co Ltd on the sidelines of the signing ceremony. Cement makers warn city of costs if production is halted HCMC can suffer extra costs of VND1.4 trillion (US$62.15 million) if it invests in cement distribution facilities to replace cement grinding plants which will be shut down to prevent pollution, said a representative of Ha Tien 1 Cement JSC. At a discussion on the development of building materials in HCMC to 2020 with a vision towards 2030, the municipal Department of Construction said the city would not invest in new cement plants, including clinker factories and grinding stations. The city plans to relocate those cement grinding stations meeting environmental standards to industrial parks in the city or other localities. Ba Ta Co JSC, for example, will shut down from next year, while Saigon Development Corporation and Ha Tien 1 Cement JSC will be relocated later. The scheme is not only meant to limit environmental pollution but also to ensure enterprises’ operations. HCMC is now home to ten cement grinding and distribution stations with a total annual capacity of more than 10 million tons, which still falls short of the city’s demand. By 2020, the city may lack 3.3 million tons a year to satisfy its demand. HCMC plans to initially build three distribution stations with a capacity of 1.2 million tons each to replace its grinding stations and cement factories. Thus, total cement supplies in the city will amount to 13.7 million tons in 2020. However, cement makers said such a plan will cost the city dearly in terms of economic value. A representative of Ha Tien 1 Cement JSC said transshipment and loading fees will be huge as the city will require ships to transport cement from northern ports. Total estimated investment may reach US$600 million, equivalent to the investment in 11 cement grinding stations with an annual capacity of 1.2 million. In addition, the city will have to build special-use ports to receive bulk cement shipments from the north as all ports have no facilities for bulk cement handling, except for Cat Lai Port in District 2. Higher prices spur retail revenue Retail revenue from consumer goods in the first seven months of the year increased substantially over the same period last year, but this rise was attributed to higher prices, according to a report of market research firm Kantar Worldpanel. The report on sales of fast-moving consumer goods (FMCG) was issued last Thursday after Kantar Worldpanel had conducted a 12-week market research in four large cities -- HCMC, Hanoi, Danang and Can Tho -- and in rural areas. Retail sales of consumer products grew 10% in January-July, 9.7% higher than in the year-earlier period. Revenues from FMCG sales in both rural and urban areas picked up 5.3% year-on-year. However, the revenue growth did not come from the higher consumer spending. Instead, in some rural areas in the central and northern regions, consumption tended to decrease, especially of dairy products. Higher prices of products were also reflected in the average consumer price index (CPI) in the first seven months which edged up 3.91% over the year-ago period. The rate was only 1.82% in January-July last year compared to the same period in 2015. According to Kantar Worldpanel, the CPI of below 4% may not be kept in the remaining months of the year as food prices inched up in July after going down for six consecutive months and fuel prices have also been revised up. Mavin pledges to inject US$80 million into Nghe An Mavin Group has pledged to pour around US$80 million into the north-central province of Nghe An, mainly in the husbandry sector, said the group’s chairman David John Whitehead at an investment conference in HCMC last Friday. Whitehead told the conference “Nghe An: opportunities for your business growth” that Mavin has been doing business in Vietnam for more than 12 years, and has set up shop in 19 provinces nationwide. The group inaugurated a feed mill in February at a total cost of US$15 million. The facility covers 3.6 hectares and has a designed capacity of 300,000 tons a year. Mavin has recently been awarded a business certificate to develop a swine nucleus farm worth US$18 million, which is part of the firm’s US$80 million investment commitment to Nghe An. Mavin also intends to establish an animal health research center, and carry out a feasibility study for a five-hectare food processing plant which may get off the ground next year.  The facility which has an annual capacity of 200,000 tons costs around US$25 million. It will turn out products from meat, such as sausages and ham, for customers at home and abroad. Whitehead said Mavin has taken into consideration many factors like manpower, market, geography, investment incentives, and transparency before making its investment decisions. The company is committed to Nghe An as the local government has extended a lot of support to it, said Whitehead. Many domestic and international investors have come to sound out business opportunities in Nghe An, according to Nguyen Chi Toan, marketing director of the Vietnam-Singapore Industrial Park (VSIP) for central and southern Vietnam. Since VSIP Nghe An, an industrial park infrastructure development company, started construction in September 2015, more than 90 companies from various countries and territories have come to the province, of which 10 enterprises have pledged over VND400 billion, Toan said. Advance payment for metro project in HCMC yet to be disbursed Although the Government has allowed HCMC authorities to use capital from the medium-term public investment plan for the 2016-2020 period to make advance payments for the Metro Line No.1 project to speed up construction work but the money has not been disbursed, threatening the progress of the project. Le Nguyen Minh Quang, head of the HCMC Management Authority for Urban Railways (MAUR), told a meeting on Saturday that the construction of Metro Line No.1, which connects Ben Thanh Market in District 1 and Suoi Tien Park in District 9, is at risk of falling behind schedule due to slower-than-expected disbursement of official development assistance (ODA) loans from the central Government. Some contractors said they would have to suspend construction work if the city delays payments, so the city has to use its own budget to advance money for the contractors. On August 25, HCMC chairman Nguyen Thanh Phong signed a decision advancing VND500 billion (about US$22 million) from the city’s budget to pay for the contractors of the project. As of early September, the contractors had received nearly VND300 billion. However, this is just a temporary solution. “The city has to pay the metro project’s contractors VND500-600 billion a month. If slow disbursement of ODA loans continues, the construction pace of the project would be badly affected,” Quang said. The city’s government earlier made an advance payment of nearly VND1 trillion for the contractors. According to MAUR’s report, Package 1a for the underground section from Ben Thanh station to Opera House station is 13.5% complete while Package 1b for the underground section from Ba Son station to Opera House station is 51% done. Package 2 for the elevated section from Ba Son to Long Binh is 69.5% finished while locomotives, cars and rails for Package 3 are now being manufactured in Japan. The contractor has plans to import the first train to Vietnam next August. Duong Huu Hoa, director of Metro Line No.1 project, said the contractors will begin to install the rails for the metro line’s elevated section in October 15. Up to 8,000 rails for the track are now manufactured in Long An Province and will be transported to HCMC soon. However, import of machines and equipment that facilitate rail installation is now facing difficulties. Quang said the Ministry of Finance earlier announced that such machines and equipment will enjoy 0% import tax. However, the ministry has issued a new circular saying that those goods might be taxed. According to Quang, another reason for the slower-than-expected construction of the city’s first metro line project is complicated procedures and paperwork on the part of ministries. Metro Line No.1 is nearly 20 kilometers long, passing through districts 1, 2, 9, Binh Thanh, Thu Duc in HCMC and part of Di An District in neighboring Binh Duong Province. It has 2.6 kilometers of underground track and over 17 kilometers of elevated track along Hanoi Highway. The US$2.49 billion project is scheduled for operation in late 2020. Tuna exports to emerging markets on the rise Tuna exports rose by 22% to US$328 million in the first seven months against the same period last year, according to latest statistics from the General Department of Vietnam Customs. Exports of most tuna products enjoy growth, particularly canned tuna saw the highest growth rate of 32.3%, trailed by fresh, frozen and dried tuna products (up 14%). Tuna products have been exported to more than 70 countries in the world. The US, EU, Israel, ASEAN, Japan, Mexico, Canada and China were major importers of Vietnam tuna products in seven months, accounting for 88% of its total export value. Most export markets obtained growth in July. For instance, tuna exports to the US inched up 8% to US$20 million while exports to the EU increased by 23% to US$69 million against the same period last year. It’s noteworthy that exports to Italy rose sharply in July after seeing constant decline since early this year. Exports to the market in the period skyrocketed 166% to US$1.2 million. Israel surpassed ASEAN and Japan to become the third largest consumer of Vietnam tuna in the first 7 months with US$28 million, up 155%. In recent times, as tuna consumption demands in traditional markets like the US, EU and Japan seem to come to a grinding halt, Vietnam tuna exporters shift to emerging markets in the Middle East, especially Israel. The Vietnam Association of Seafood Exporters and Producers forecast that tuna exports to the US and EU will increase slowly late this year while exports to new markets will witness strong rise. French firms learn about investment chances in Da Nang’s hi-tech park Representatives from about 30 French enterprises participated in a seminar introducing investment opportunities in the hi-tech park in the central city of Da Nang held by the French Business Federation (MEDEF) in Paris on September 11. The event was part of the Da Nang Hi-Tech Park (DHTP) Management Board’s investment promotion activities in Europe. At the seminar, Director General of the board Phung Tan Viet informed the participants of the park’s construction process and development plans. Participating businesses were also briefed on Da Nang’s preferential policies and projects which need investment in the DHTP. With a total area of more than 1,100ha, the DHTP is one of Vietnam’s three hi-tech parks, connecting industrial and economic zones in the key economic region in central Vietnam. The park welcomes enterprises to visit and invest in its projects, Viet added. Michel Jonqueres, President of the MEDEF’s International Commission, said that Da Nang and the DHTP’s clear administrative procedures are an advantage that encourages investment. He also expressed optimism about the two sides’ cooperation opportunities, especially with Da Nang hosting the APEC Leaders’ Week 2017 in November and drawing leaders of 21 APEC economies and thousands of official delegates and heads of the world’s leading enterprises. At present, the DHTP has more than 300ha of land available for investment projects. In the first half of 2017, it attracted seven projects worth 158 million USD. Vietnam accelerates fruit, veggie imports from Thailand Vietnam’s fruit and vegetable imports from Thailand in the first seven months of 2017 picked up 3.2 times compared to the same period last year, shows Ministry of Agriculture and Rural Development data. In explaining the sudden upsurge, Hoang Trung, head of the Plant Protection Department under the ministry, said Vietnamese firms bought fruits and vegetables from Thailand to ship them on to China. Thailand remains Vietnam’s largest exporter of fruits and vegetables and accounts for 61.8% of the country’s total fruit and vegetable purchases from abroad, followed by China with 16%. Besides Thailand, India and New Zealand were also major fruit and vegetable exporters to Vietnam, with respective growth of 2.2 times and 53.5% in January-July. According to a report by the Ministry of Agriculture and Rural Development, Vietnam spent US$169 million buying fruits and vegetables in August, taking the total in the first eight months to US$1.02 billion, a year-on-year surge of 94%. Vegetable imports doubled to US$190 million and fruit imports grew 34.6% to US$809 million year-on-year. In the other way around, Vietnam has secured Thailand’s approval to annually export 9,000-10,000 tons of fruits and vegetables to the neighboring country, especially dragon fruit, Trung noted. The ministry report also said Vietnam exported US$296 million worth of fruits and vegetables last month, taking the total in January-August to US$2.32 billion, up 46.5% versus the year-ago period. China, Japan, the U.S., and South Korea were the four leading importers of Vietnamese fruits and vegetables in January-July, representing 85.1% of the country’s total exports. In the first seven months of the year, the country’s major export markets include Japan with 61.7% growth, the United Arab Emirates with 61.4%, China with 61.3%, Russia with 49.4%, the U.S. with 26.7%, Taiwan with 19.2% and the Netherlands with 12.9%. Industry ministry still struggling with 12 loss-making projects The Ministry of Industry and Trade is still grappling difficulties in dealing with the 12 loss-making investment projects though there are bright prospects for some of them. The ministry told Deputy Prime Minister Vuong Dinh Hue, head of the steering committee for handling the 12 projects, at a meeting in Hanoi on September 6 that Viet Trung steel mill and DAP 1 fertilizer plant in Haiphong City had begun to be profitable, reports the Government news website. For the ethanol projects in Quang Ngai and Phu Tho provinces, some investors have shown interest in them. A report delivered at the meeting by the ministry said four fertilizer projects of the Vietnam Chemicals Group have resumed production but one of them, DAP 2 in Lao Cai Province, has stopped operation for maintenance since August 12. However, all of them but DAP 1 in Haiphong City have yet to be financially efficient as input costs have remained higher than expected. For five projects under the Vietnam Oil and Gas Group (PVN), the Dung Quat ethanol plant in Quang Ngai Province has not been able to return to production due to the lack of funding for solving problems with its wastewater treatment facility. Moreover, shareholders have been discouraged by the lower-than-expected fuel prices which might lead to losses for them. Ethanol is mixed with A92 gasoline to make E5 bio-gasoline, a fuel which is cheaper than A92 and A95 petrol but has yet to win consumer confidence due to concerns over quality. The ministry said at the meeting that several investors have expressed interest in getting involved in this ethanol project and that shareholders have been told to work with investors over the possibility of clinching a business cooperation contract to bring the facility back to life. Meanwhile, PVN has told its subsidiary PVOil to draw up plans to divest from an ethanol plant in Phu Tho Province and another in Binh Phuoc Province. The ministry’s report said there has appeared an investor interested in the Phu Tho facility. PVTex, a polyester fiber factory in the northern city of Haiphong, has remained in distress as it has been financially unable to carry out a court decision to pay out more than VND73 billion in water and power bills for the authority of the Dinh Vu Industrial Park where PVTex is located. Meanwhile, the Government is determined to not inject new capital into PVTex. For Dung Quat Shipyard, PVN has asked its affiliates to use services at the shipyard to help keep it afloat and secure jobs for workers there. But there is a high possibility that the shipyard could be disbanded. In two steel projects under the Vietnam Steel Corporation, the ministry said, after the Government took back a VND1 trillion budget for the second phase of Thai Nguyen steel plant, Chinese contractor MCC has returned to the negotiating table to solve the lingering problems with this project. The other steel project, Viet Trung steel mill, has reported profit since March this year, with first-half profit estimated at VND67 billion and full-year tax payments projected at VND290 billion. Deputy PM Vuong Dinh Hue told the State Bank of Vietnam to work with commercial banks over plans to restructure debts owed by the 12 projects. These plans would be used as a basis for the Ministry of Finance to weigh rescheduling the depreciation and amortization process of the 12 projects. Meanwhile, the owners of these projects must find ways to cut costs and implement restructuring plans so that they could get out of the woods, Hue noted. Property market seen undergoing drastic change The HCMC Real Estate Association (HoREA) has forecast there will be a drastic shift in the property market in the 2016-2020 period with demand for small and medium houses for low-income people to surge and supply of high-end apartments to outstrip demand.  The real estate market in HCMC and Vietnam as a whole was opened up in 1987 and officially took shape in 1993 when the National Assembly passed the first law on land use and an ordinance on homeownership. The market development depends on five factors, namely the law of value, competition, supply and demand, government policies and mechanisms, and investment and business activities of enterprises. The property market expanded significantly in 1993, 2001, 2002 and the second half of 2010. But it became frozen from 1995 to 1999, from early 2008 to mid-2009 and in the 2011-2013 period but then recovered robustly in the 2003-2006 period, and from 2009 to mid-2010. Since 2013, the market has remained buoyant. The real estate market in HCMC registered positive growth in the 2006-2015 period despite woes. Since 2016 the market has shown signs of slowing down, especially in the high-end housing and tourism property segments. However, the market fundamentals have stayed solid given strong demand. Vietnam holds strong e-commerce growth potential - report E-commerce in Vietnam has much room for growth but local companies have yet to tap its potential, according to a market research report. The next source of growth is Connected Spenders, who have the ability to access the Internet and are willing to spend their discretionary income, according to the report by Nielsen Vietnam and the Demand Institute. The report predicts these consumers will account for nearly 40% of the global population, thereby contributing more than 50% to annual spending. Thanks to growing access to the digital economy and all that comes with it, the East Asia and Pacific region will witness the greatest increase in the number of Connected Spenders, especially in emerging markets like Indonesia, the Philippines, Thailand and Vietnam. The report says there were 23 million Connected Spenders in Vietnam in 2015 and the figure is expected to nearly double to 40 million by 2025. Their spending will rise from US$50 billion annually to US$99 billion over the same time period and by 2025, they are expected to account for half of the total consumer spending. Around one-third of Vietnamese Connected Spenders are between 21 and 34 years old (34%). By definition, the report says, over three-quarters of the consumers within the higher income bracket are Connected Spenders (76%) and nearly two-thirds of those have middle income, and 43% falls into the lower income group. “Vietnamese Connected Spenders will spend US$0.8 trillion over the next decade. Therefore, for consumer-facing businesses seeking to grow in Vietnam, these are the consumers whose needs will need to be addressed,” said Rakesh Dayal, executive director of Consumer Insights at Nielsen Vietnam. The report stresses Connected Spenders are much more adept at omnichannel shopping. Around 80% of them think shopping online is more fun and convenient. Before buying, regardless of searching online or offline, they gather information from both sources. Around four in five read online reviews (83%) and refer to social media comments (74%) prior to purchasing a product whereas two out of three (66%) check out products in the physical store before purchasing them online. Especially, Connected Spenders are price-conscious, constantly on the lookout for special deals and promotions: more than half of them use price saving apps to search for the best deals even when they plan a shopping trip online or in store. Therefore, Nielsen Vietnam urges local firms to pay attention to Connected Spenders as a new emerging type of consumer. Vietnam has great potential for e-commerce as more than half of the population has access to the Internet, and 44.3% of households own smartphones or mobile devices. Notably, online consumers rocketed 129% in 2011-2015, according to a survey of Vietnamese consumers conducted by Singapore-based market technology company Criteo. However, data of market research firm Kantar Worldpanel Vietnam shows e-commerce, despite exponential growth, accounted for a mere 0.4% of the domestic retail market last year. Of this tiny market share, 43% of goods were sold by traders on Facebook while the remainder were consumed through e-commerce websites. Kantar Worldpanel forecasts e-commerce will amount to 2.2% and online buyers will make up 25% of the total by 2025. Domestic gold prices fall sharply Gold prices slumped in the Vietnamese market on Tuesday morning. On the Hà Nội market, selling price of one tael, or 1.205 ounces, of State-owned SJC’s gold declined by VNĐ190,000 (US$8.3) to VNĐ36.75 million.  On the buying side, the price of each tael also fell VNĐ160,000, trading at VNĐ36.53 million. In the southern cities of HCM and Cần Thơ and central Đà Nẵng City, one tael of SJC’s gold declined VNĐ250,000 during selling, trading at VNĐ36.73 million. Meanwhile, one tael was being bought at VNĐ36.53 million. Bảo Tín Minh Châu Gold Jewellery Company and Doji Gold and Jewellery Corporation (DOJI) listed their selling prices at VNĐ36.68 million and VNĐ36.70 million, respectively. Buying rates of their gold were listed at VNĐ36.62 million and VNĐ36.60 million, respectively. On the Asian market, gold is trading at some $1,325 per ounce, equivalent to VNĐ36.36 million per tael. On global gold trading website Kitco.com, the price of gold slipped 1.2 per cent per ounce to end at $1,330.24 per ounce, the largest drop since July 3. Last Friday, global gold price hit a yearly peak of $1,357.54 per ounce. Thus, the price of one tael of gold in Việt Nam is some VNĐ410,000 higher than that on the world market. Global gold prices declined due to an upward trend in the dollar rate following an uptick in risk appetite fuelled by relief that North Korea did not test-fire missiles or conduct nuclear tests over the weekend as some had feared, Reuters reported. Assets traded primarily in dollars, such as gold, are very sensitive to currency fluctuations. An increase in the dollar rate will lead to gold becoming more expensive compared with other currencies and the demand for gold also decreases, the website said. Meanwhile, the worst-case scenario due to Hurricane Irma’s impact, the most powerful hurricane ever recorded in the Atlantic, looked to have been avoided, easing concerns of investors about the negative impact of the storm on the US economy.  Stocks correct down after 10-year peak The local stock market underwent a downward correction yesterday as investors increased selling pressure to seek short-term cash profits following a 10-year peak. The benchmark VN-Index lost value in the last trading minute, falling off the 10-year peak recorded Friday, closed down 0.47 per cent at 797.47 points. The market breadth on the HCM Stock Exchange was negative with 189 stocks declining, 29 rising and 75 closing flat. Large-cap shares were also on the defensive with 21 of the top 30 largest shares by market value and liquidity (VN30) losing value and only seven advancing. Top shares, such as Vietnam Prosperity Bank (VPB), Military Bank (MBB), real estate giant VinGroup (VIC), PV Gas (GAS), confectionery Kido Group (KDC), steelmakers Hòa Phát Group (HPG) and Hoa Sen Group (HSG) dropped between 1.9 per cent and 3.1 per cent, each. Brewer Sabeco (SAB), insurer Bảo Việt Holdings (BCH), private equity Masan Group (MSN), FLC Faros Construction (ROS) and budget airline Vietjet (VJC) slowed last week’s growth and failed to lift the market. “Profit-taking pressure will remain high in the next sessions after a streak of gains of the VN-Index over the past three weeks,” said Trần Đức Anh, a stock analyst at Bảo Việt Securities Co. The key market index has expanded about 4.2 per cent in the last three weeks. Anh predicted some large-cap stocks would continue to rise but the rally will not be strong enough to support the overall market. According to Nguyễn Hồng Điệp, director of the Sài Gòn-Hà Nội Securities Co’s HCM City branch, the market could see a short-term correction but it would not be long and serious. Điệp said the market rally was driven by growth of some major large-cap stocks while a majority of the market has not been on the same rising wave. This phenomenon was part of investors’ anxiety about the market outlook, which is often volatile in the exchange-traded funds’ portflio restructuring period. However, the 800 point landmark did not indicate a market downturn and the achievement would motivate the market to go further, Điệp was quoted as saying on vietstock.vn. On the Hà Nội Stock Exchange, the HNX-Index also dropped 0.99 per cent to end yesterday at 102.89 points. Liquidity rose slightly, totaling 195 million shares worth VNĐ4.2 trillion (US$185 million) on the two exchanges. VNA/VNS/VOV/SGT/SGGP/TT/TN/Dantri/VNEVET