BUSINESS IN BRIEF 8/11 Vietnam earns US$6.15 billion from wood exports   The export turnover of Vietnamese wood and wooden products is estimated at US$6.15 billion since the beginning of this year, up 10.1% year on year. According to the Ministry of Agriculture and Rural Development, the US, China, and Japan were the biggest importers of Vietnamese wood and wooden products. In the period, markets posting high growth rates included the US (18.8%), Canada (15.1%), the Republic of Korea (11.1%) and China (9.1%). Experts said that the goal of US$8 billion in wood exports this year is feasible as the main season for wood exports is the last three months of the year. Vietnam imports a large amount of wood materials worth US$1.7-US$1.8 billion annually, equivalent to about 20%-30% of export turnover. Suncity to buy into Hoiana An casino resort Macau’s biggest junket operator Suncity Group is negotiating the purchase of 34% stake in South Hoi An integrated casino resort complex, now called Hoiana, while simultaneously confirming to pour US$26.2 million in the project, according to newswire Dealstreetasia. Accordingly, Suncity will take over 34% stake from Chow-Tai-Fook Group’s subsidiary Golden Yield Enterprise (GYE), which is a partner in the joint venture established to develop the Hoiana project. Suncity entered into a co-operation with GYE and Vietnam-based Vinacapital to develop the US$4-billion Hoiana project in the central province of Quang Nam. The project’s first, US$650-million phase is in implementation. As of now, VinaCapital invested US$89 million into the first phase and will mobilise an additional US$484 million. With the 34% holding in the project, Suncity will have to contribute US$26.2 million to develop the first phase, which is expected to come into operation in 2019. Licensed in 2010, the project was initially developed by VinaCapital and Genting Malaysia Berhad and comprised of five-star hotels, villas, and a casino targeting foreign tourists. However, in September 2012, Genting suddenly announced its withdrawal in the midst of site clearance, forcing VinaCapital to find other partners to jointly develop the project. After finding suitable partners, in late April 2016, the joint venture held the ground-breaking ceremony. The construction was implemented by Vietnamese contractor Coteccons. Investing in the Hoiana project is part of Suncity’s plan to pour billions of dollars into integrated casino resorts in Vietnam and Japan, aiming to realise its ambition of becoming an overseas casino operator on par with Las Vegas Sands Corp. and Wynn Resorts Ltd. In spite of operating VIP rooms where monthly bets recently surpassed US$17 billion, Suncity still plans to seize ownership in casinos and bid on contracts to manage casinos aboard. The ambitious expansion is planned even as Macau’s high-roller business continues the rebound that began last year. “In the future, if we own integrated casino resorts with golf courses, swimming pools, and restaurants, our clients will stick more with us,” said Andrew Lo, executive director of the group’s listed vehicle, Suncity Group Holding Ltd. Suncity selected Vietnam as an overseas investment destination due to its potential in the gaming sector. According to a report published on August 9 by Grant Govertsen, an analyst at Macau-based Union Gaming Securities Asia Ltd., Vietnam could generate as much as US$1.2 billion in gross gaming revenue in the upcoming years. Ben Tre’s vast coconut groves Most of Ben Tre’s vast coconut groves are in the western districts of Chau Thanh, Cho Lach, Mo Cay, and Giong Trom. Annually, the province harvests 600 million coconuts from 70,000 hectares of land to lead Vietnam in both growing area and production output. Ben Tre brand coconut products are diverse and account for 85% of the region’s total output.   Tam Trung’s Dat Dua candy workshop is located in Tan Thanh hamlet. Trung and his family use traditional methods to make coconut candy. Tran Thi Huong, a worker at Dat Dua workshop, described the steps used to make coconut candy while wrapping candies in paper. She said, “First the coconut flesh is separated from the hard shell, ground, and all of the bits of the brown skin is removed. The white coconut is dried on a hot pan for 45 minutes, then cooled, molded into bite-sized pieces and wrapped in paper. All steps are done manually.” Every day, Trung’s workshop welcomes hundreds of foreign visitors who come to see how sticky coconut candies are made and, of course, to buy some candy. Even while attending to crowds of visitors, Trung still has to pay close attention to making his coconut products. “Ben Tre is home to many coconut trees. All parts of the coconut are useful. The tree-trunk is used to make fine art pieces. Coconut flesh is for candies while the hard shell is used to make char coal. Coconut juice is for making coconut jelly. When coconuts turn browner and lighter, we use the flesh to make coconut oil or food for fish,” said Trung. On display at Trung’s workshop are numerous fine art pieces, including baskets, containers to keep teapots hot, clocks, and toy animals – all made by Tan Thanh villagers. Tu Dang who has created statues from coconut tree trunks, said “In the past growing coconut trees didn’t produce much income. But it always offered a stable livelihood because all parts of coconut trees are useful. To make fine art pieces, the trees must be 40 years old or more.” Phan Thu Nguyet, who has long been involved in coconut-based fine arts, told VOV: “Our living conditions have much improved thanks to making fine arts products. We, for example, can utilize the most of free time to make decorative lanterns from coconut stems.” For some locals, the coconut tree has been closely linked to their lives for years. It has entered Vietnamese literature and poetry and helped the villagers achieve heroic feat of arms during times of national defense. Nguyet said the coconut tree symbolizes the Ben Tre people, who are also sturdy and proud, adding: “Generally coconut trees are close to the locals. In the lyrics of a song called ‘Posture of the Coconut Tree’, the tree represents the friendliness and hospitality of Ben Tre people.” Ben Tre is famous for its coconut industry. Everything that comes from coconut trees, including the trunk, the leaves, hard-shells, the fiber – even coconut worm larvae - can be used in cooking or made into something for export. Ben Tre’s products are available in 68 countries and territories bringing the province revenues of US$200 million a year and comprising 40% of the province’s total exports turnover. Potential impact of EU-Vietnam FTA The EU-Vietnam Free Trade Agreement (EVFTA), which is going to be signed in 2018, will boost Vietnam’s GDP by US$3.2 billion by 2020, US$6.7 billion by 2025, and US$7.2 billion by 2030. The EU is an economic union consisting of 28 member states and a population of 508 million people, and an aggregate GDP of US$18 trillion, making it the largest unified market all over the world. The EU is one of Vietnam’s leading trade partners, accounting for 19% of Vietnamese exports. Vietnam-EU’s export turnover was US$20.6 billion in 2015. The EU ranks second among the official development assistance (ODA) donors of Vietnam with more than 40% of non-refundable aid. “The EU is a very important partner for Vietnam in every field of the economy, with strong impact on the country’s development. The EVFTA has become more important to the development of Vietnam after the US’ withdrawal from the TPP,” emphasised Truong Dinh Tuyen, former Minister of Trade. EVFTA negotiations were closed in 2015, the document has been translated into 23 languages and are going to be signed in 2018. Upon entering into force, it will impact the development of modern market institutions and Vietnam’s international integration via the multiple commitments to open up the market to ensure the freedom of movement for goods, services, as well as investment and factors of production, promoting transparency and stability. The FTA will also impact Vietnam’s growth through investment and export expansion. Following a 7/10 roadmap, the EU will remove all import taxes on Vietnamese goods within seven years, while Vietnam will do so in return within 10 years. This arrangement means the EU will remove taxes faster, and many of Vietnam’s flagship export products will be able to enter the EU completely exempt of tariffs after the EVFTA comes into effect or a short time later. These advantages will create new motivation for Vietnamese exports to the EU. According to a report of economist Pham Thi Lan Huong, a researcher of the European Trade Policy and Investment Support Project (EU-MUTRAP), presented at the workshop consultation on the potential impact of the EVFTA held on November 2, 2017, Vietnam’s export turnover towards the EU will gain approximately US$33 billion by 2020, US$42 billion by 2025, and US$47 billion by 2030. Specifically, 50% of the tariff lines on aquatic products will be removed right after the FTA comes online. 0% tax will be applied to rice imports (within a quota of around 20,000 to 30,000 tonnes per year). Goods like coffee, pepper, cashew nut, honey, fresh vegetables, fruits and their processed products or juice will see tariff exemption instantly, while they are imposed rather high tariffs at the moment (up to 17-20% for some products). Apparel and footwear are two of Vietnam’s major export goods to the EU, with annual turnover of US$3.5 and 4 billion, respectively. These product categories will see tariffs cut by 42.5% and 37%, respectively, after the enforcement of the FTA. Wood and wood products, computers, electronic products, and components will also see tariff cuts. Vietnamese businesses could bid to provide goods, services, and to be involved in construction projects in EU member states. This is an opportunity for them to approach the EU markets. However, firms must follow the original rules applied to each specific product in the FTA, while conducting export or import activities, as well as understand EU regulations and frequently update on information to enjoy the best tax incentives. Hung Yen creates favorable conditions for investors Hung Yen province’s economy has improved in recent years thanks to more investment in local industrial zones and incentives for domestic and foreign enterprises. Hung Yen plans to build 10 industrial zones on an area of 2,400 ha. Four industrial zones have been put into operation attracting about 380 projects. Around 70% of these industrial parks have been filled, thanks to their favorable location. Nguyen Duc Thang, Director of Thang Long Industrial Park II Company of the Japanese Sumitomo Group which has been operating in Hung Yen since 2006, said "Sumitomo Group invested in Hung Yen because of its favorable geographical location and developed transport infrastructure. It’s easy to go to Hanoi or to major sea ports in the north including Hai Phong and Cai Lan. We have received much support from the provincial People’s Committee, particularly in land clearance." Hung Yen has particularly focused on luring high tech and environmentally friendly projects and those on mechanics, electronics, and support industry. Pham Thai Son, the Director of the Management Board of Industrial Zones in Hung Yen, said, "Every year since 2014 Hung Yen has attracted US$300 to US$350 million worth of foreign investment.  They include high tech projects from Japan’s Nikiso Group, Hoya Glass Disk Vietnam, and TOTO Vietnam Company with registered investment capital of between 70 and US$100 million each. Some Vietnamese companies including Hoa Phat Group and Nutifood have invested in Hung Yen." Son said Hung Yen province is speeding up land clearance and constructing three more industrial parks. “Hung Yen plans to develop a 3,000-hectare urban industrial park which is close to the Hanoi-Hai Phong Highway and the new Road 39 to attract more investment. The province is calling on Vietnamese, Japanese, and the Republic of Korean investors to invest in the local infrastructure. We hope to draw American and European investors whose investment in the province remains modest," Son added. By September, FDI projects in Hung Yen came from 17 countries and territories with a total registered investment capital of more than US$3 billion.  Japan is the biggest investor with 107 projects worth more than US$2 billion, followed by the Republic of Korea with 37 projects worth more than US$412 million. The achievements are attributed to the province’s specific solutions to create a favorable environment for investors. Hung Yen has invested in electricity, transport, water supply, and drainage, and speeded up administrative reforms. Nguyen Duc Thang, Director of Thang Long Industrial Park II Company, praised local support for enterprises, adding, "The province has created favorable conditions for Japanese investors in Thang Long Industrial Park II. They talk with businesses every year to promptly address problems and difficulties encountered by enterprises in the production and business process." "The provincial People's Committee has also supported investors with streamlined administrative procedures. It takes only one to three days to get an investment license or business establishment certificate. If we have any administrative difficulties, we discuss with the provincial People's Committee for a prompt solution," he added. New regulation puts the squeeze on Vietnamese car importers While erecting technical barriers to hinder the flow of imported cars, Vietnam plans to cut taxes imposed on locally-made vehicles to boost its auto industry. Nguyen Dinh Thanh, the owner of a car dealership in Hanoi’s Long Bien District, is in danger of going out of business when a new decree regulating automobile imports takes effect next year. The decree stipulates that traders will only be permitted to import automobiles if they can provide valid vehicle registration certificates issued by authorities from the countries of origin. Original quality control certificates for each vehicle and letters of authorization regarding recalls of defective vehicles from the manufacturers will also be required, along with copies of quality assurance certificates provided by the countries of origin. “The requirements are too strict for car dealerships to meet,” Thanh said, worrying that the dealership that has fed his family and dozens of workers over the last 10 years will have to close. “We will import 40 more units before the decree takes effect (January 1, 2018). When they are sold out, maybe in two months, we will have to shut down the business.” Thanh is not the only car dealer concerned about the new regulations. Nguyen Tuan, director of auto dealership Thien Phuc An, said: “It is very difficult to get copies of quality assurance certificates for imported cars from foreign authorities. Only official distributors and subsidiaries of manufacturers in Vietnam can get them.” “Small traders who import cars through sub-agents or a third country are unable to do this,” he added. Another requirement that requires enterprises to have one car from each batch of imports technically accredited in Vietnam will cost importers more time and money, he said. “Businesses may have to spend weeks and up to VND100 million (US$4,340) to complete the accreditation procedure.” Under current regulations, only one certificate is required for each model of car, regardless of how many batches are imported. Pham Anh Tuan, head of the strategic planning department at Toyota Vietnam, said foreign authorities only provide quality assurance certificates for cars sold in their own countries, not for those that are exported. This is the same in Vietnam. In some countries, authorities do not issue these certificates at all. In the United States, for example, car manufacturers are responsible for quality control, and government agencies only take over after the assembly line, he said. Thanh urged the government to change the policy so that car dealerships can survive. He said it would be a waste of money if car dealers had to shut down after making huge investments. Thousands of employees would also lose their jobs, he added. Private economy thrives in southern localities The increasing number of newly-established firms in the southern region in recent years has demonstrated their stronger confidence in Party and State policies designed to support the development of the private economy. The private economy is defined as an important contributor to the economic development of cities and provinces and the country as a whole. Therefore, such southern localities as Ho Chi Minh City, Dong Nai and Binh Duong provinces have attached great importance to promoting private firms and creating all possible conditions for their development. Following the spirit of the 12th Communist Party of Vietnam (CPV) Central Committee’s Resolution on developing the private economy, the southern economic hub of Ho Chi Minh City has put forth a number of policies to support businesses’ operation, including taxes, customs and production premises, according to Huynh Thanh Dien, member of the city’s Support Industry Development Project. Statistics from the municipal Department of Planning and Investment showed that more than 309,000 enterprises are active in the city with a total charter capital of over 3.5 trillion VND (154 million USD). The number of businesses is forecast to double by 2020. Similarly, Binh Duong and Dong Nai provinces have devised numerous policies to develop the private economy, especially improving administrative procedures and investment promotion efficiency. As a result, more than 29,000 enterprises have registered to operate in Binh Duong with a total capital of over 200 trillion VND, generating jobs for 15,000-20,000 workers annually. The province targets additional 23,000 new firms in 2016-2020. The number of newly-established businesses in Dong Nai is increasing with an average of over 2,000 firms each year. Synchronous measures from both State and businesses are essential to create a driving force for the private economy, including the reduction of production costs. Nguyen Dinh Tue, Director of HCM City Centre for Supporting Small and Medium Sized Enterprises, said the southern metropolis is leading the country in promulgating policies to support businesses.  He advised the city to create fundamental changes in administrative reform and improve the business environment. For Dong Nai, the province has given priority to improving the quality of administrative procedures and ensuring transparency in addition to encouraging businesses’ innovation and application of science and technology into production and supporting individuals and start-ups. Vice Chairman of the Binh Duong People’s Committee Dang Minh Hung said the province aims to become a developed industrial locality in the Southeast Asian region by 2020.  The promotion of start-up movement is considered a key strategy, he said, adding that local authorities have approved a plan to implement a project on national innovative start-up ecosystem through 2025. APEC 2017: Vietnam affirms active role in APEC Hosting the Asia-Pacific Economic Cooperation (APEC) Forum for a second time shows that Vietnam is an active and responsible member of the group, making effective contributions to APEC’s development after 19 years of membership. Vietnam’s admission to APEC in 1998 marked an important milestone in the country’s external policy of expansion, diversification and multilateralisation of relations and international economic integration.  APEC was the first economic cooperation mechanism in Asia-Pacific Vietnam joined after entering the “Doi moi” (reform) process, with a focus on long-term cooperation frameworks with partners in the region. Over the past 19 years, with the motto of cooperating to jointly build a peaceful, stable, developing and prosperous Asia-Pacific community, Vietnam has proved an active member via promoting economic connectivity and reinforcing the regional multilateral trade system.  Vietnam has not only participated in APEC cooperation programmes in various fields and implemented APEC cooperation commitments but also put forth proposals and initiatives to facilitate trade and investment in the region. The country’s practical and remarkable contributions to APEC during its 19-year membership have increased trust from other economies. Notably, Vietnam made positive impressions during its first time hosting APEC in 2006, which mapped out long-term cooperation plans for APEC, especially the Hanoi Action Plan to implement the Busan Roadmap towards the Bogor Goals on trade and investment liberalisation by 2020. The hosting of APEC 2006 and other forums in recent years has helped Vietnam gain experience in preparing for and contributing ideas, initiatives and major orientations for the APEC Year 2017.  The country selected “Creating New Dynamism, Fostering a Shared Future” as the theme of APEC 2017 to promote growth via extensive and intensive economic cooperation and integration in Asian-Pacific. Vietnam proposed four main priorities, including promoting sustainable, innovative and inclusive growth; deepening regional economic integration; strengthening competitiveness and innovation for micro-, small-and medium-sized enterprises in the digital age; and enhancing food security and sustainable agriculture in response to climate change. The 25th APEC Economic Leaders’ Meeting this week in the central coastal city of Da Nang will contribute to maintaining the role and position of APEC as well as building a self-reliant, dynamic and prosperous Asia-Pacific. Established in 1989, the Asia-Pacific Economic Cooperation (APEC) forum comprises 21 economies, including Australia, Brunei, Canada, Chile, China, Hong Kong-China, Indonesia, Japan, the Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Chinese Taipei, Thailand, the US, and Vietnam. APEC represents about 39 percent of the world’s population and contributes 57 percent to global GDP and 49 percent of international trade. VPBank posts $246.8m pre-tax profit      Viet Nam Prosperity Joint Stock Commercial Bank (VPBank) posted a pre-tax profit of VND5.6 trillion (US$246.8 million) in the first nine months of the year, a 79 per cent year-on-year increase and reaching the top three of country’s banks following Vietcombank and Vietinbank. VPBank’s third-quarter business results included impressive growth in profit, total assets, equity, and capital adequacy ratio, showing that the bank is likely to reach its ambitious VND7.2 trillion profit target by year’s end. Its profits have been mainly generated from total operating income, which increased by 48 per cent compared with the same period last year and reached VND17.5 trillion. Net interest and similar income in the first nine months was VND14.9 trillion, up 41 per cent year-on-year. Meanwhile, operating expenses grew at a rate of only 33 per cent, much below the growth rate of total operating income. The non-performing loans ratio of the bank remained at 2.6 per cent.  Japanese firms eye big opportunities in Vietnamese water sector As many as 23 Japanese firms are expected to take part in VietWater 2017, Vietnam’s leading international water supply, sanitation, water resources, and purification event this week on November 8-10. Accordingly, the Japanese Pavilion will be launched for the sixth consecutive year, promoting Japanese's high-technology in machinery and water treatment services. The firms include Ogiso Kentiku Co., Ltd., Takasago Industry Co., Ltd., TAK Manufacturing Co., Ltd., Kowa Trading Co., Ltd., Miura Chemical Equipment Co., Aplus Trading Co., Ltd., and Marusan Kinzoku Corporation. Five of the Japanese participants are planning to establish units in Vietnam. At VietWater 2016, a similar number of Japanese companies attended the event with 863 trade exchanges recorded and 87 trade agreements signed worth a total value of JPY500 million ($4.4 million). "VietWater 2017 is expected to open up wider business opportunities for Japanese firms," said an official of a Japanese firm. Due to the rising population, economic development, and industrialisation, the demand for daily waste and industrial waste treatment in Vietnam has grown significantly. This has made the country more appealing to foreign investors in the field. To be held in Ho Chi Minh City, this year's event will attract over 480 exhibitors from 38 countries and regions, as well as 14 international pavilions, including Australia, Belgium, China, the EU, Finland, Germany, Hungary, Singapore, Korea, Taiwan, Thailand, and the UK. A wide array of cutting-edge technologies, solutions, products, and equipment in all subdivisions of the water and renewable energy industry will be showcased at this business platform. They will give great opportunities to connect and find solutions for managing, operating, and controlling water and energy projects. My Thuy Port might be kicked off in 2018 With foreign investors lining up, My Thuy International Seaport in the central province of Quang Tri will likely be kicked off in early 2018, according to the Quang Tri Department of Planning and Investment. The Ministry of Transport (MoT) has green-lighted the development of My Thuy International Seaport project which will take place in three stages to ensure its feasibility. In a document sent to Quang Tri on October 31, MoT agreed with the plan to first develop four piers by 2020. In the second stage three other piers will be built by 2030, and three more in the third stage. This adjustment was made following comments from MoT, which said that the earlier-proposed project is too much bigger than the detailed planning for ports of the central region including Quang Tri. According to a VIR source, the investor, My Thuy International Port Joint Venture Company (MTIP), has finished the feasibility study of the project. "As many as 14 investors have showed interests in the project. If everything goes smoothly, we plan to kick it off in early 2018," a senior official of the province told VIR. Getting in-principle approval from the government in April 2017, the project has been stuck since then as Quang Tri and MoT failed to reach a consensus on the capacity of the $630-million project. MoT suggested that the province carefully consider the volume of goods forecast to be shipped via the port. Particularly, the volume of goods from industrial zones (IZs) in the South East Economic Zone and other IZs in the province, as well as goods in transit for Laos, the East-North region of Thailand in the East-West Economic Corridor. According to MoT, the volume of goods shipped via My Thuy Port is estimated to be 18.36 million tonnes by 2020 and 35.75 million tonnes by 2030, much higher than the 1.1 million and 1.5 million tonnes projected in the detailed planning for ports of the central region. Located in Hai Lang district, My Thuy Port will work as a transshipment port for goods in the East-West Economic Corridor, thus creating a driving force to attract more investors to the province. At present, many projects in the South East EZ are awaiting the project’s approval. About 10 projects have been so far registered in the EZ with a total investment capital sum of VND62.3 trillion ($2.83 billion), focusing on seaport services, thermal power, energy, and infrastructure. Solar market embraces local-international partnerships High-quality partnerships of local know-how and international experience are key to unlock Vietnam’s solar potential. Solar energy market embraces stronger partnerships between local and international experience  This insight was shared today with more than 100 representatives from provincial authorities, investors, and other stakeholders at the workshop entitled “Introduction of Circular No.16/2017/TT-BCT on Solar Power Project Development and Standardised Power Purchase Agreement for Solar Power Projects.” Solar power is high on the agenda in Vietnam since the publication of the prime minister’s Decision No.11/2017/QD-TTg in April, which sets the feed-in-tariff at  9.35 US cents/kWh. However, the decision also sets June 2019 as the deadline for the solar power plants to be built and connected to the grid in order to receive this feed-in tariff (FIT).  ”In this context, the workshop is a very important initiative as it provides guidance to investors, local governments and financial institutions. It is also an opportunity for local governments to better understand the circular and gain insight into the latest solar developments, which will be helpful to better assess and approve solar power plants at provincial levels,” said Sonia Lioret, head of GIZ’s 4E project at the workshop. As part of the workshop, representatives from the Electricity and Renewable Energy Agency explained the content of Circular 16 and answered questions from participants. Consultants from GIZ shared international observations on solar power development in Vietnam, together with a presentation about international and regional experiences regarding the technical and financial assessment of solar power projects. Solar projects require high upfront investment. In some provinces land availability or grid capacity limit the number of projects that can be approved by local and central authorities. It is therefore important to carefully assess the general viability of these new solar projects. This includes the choice of the site, the experience of all parties and contract partners involved in the project, as well as the quality of the equipment and the installation process in order to avoid project failures or economic underperformance.  "As solar power is still quite new in Vietnam, bearing in mind that all projects have to be built and connected by June 2019, we believe that the combination of local knowledge and international experience will be a great recipe for successful projects,” said Rainer Brohm, a German solar energy expert who held a presentation at the workshop. RoK’s SY Group opens representative office in Bac Lieu The SY Group from the Republic of Korea has opened a representative office in Bac Lieu city of the Mekong Delta province of Bac Lieu. SY operates in multiple industries such as construction materials, architecture, colour-coated steel and energy. At an inauguration ceremony for the office last week, Deputy Director of the provincial Department of Planning and Investment Tran Thanh Hai said Bac Lieu will provide the best possible conditions for the group. The province will support businesses and investors since their development also means growth for the locality, he stressed. The SY Group is carrying out a solar power plant in Long Dien Dong commune of the province’s Dong Hai district. Covering 400ha, the project will be implemented from 2017 to June 2019 at a total cost exceeding 10.24 trillion VND (450 million USD). It will have total capacity of 300MW when fully operational. This is the biggest solar energy project in Vietnam so far, according to Chairman of the SY Group Hong Young Don.   Vietnam reports US$5 billion phone exports in October Export revenue from phones and phone parts last month rose a staggering 76.4% year-on-year to an estimated US$5 billion, according to the General Statistics Office. Phones and phone parts were the biggest export earner of Vietnam last month. Their outbound sales were roughly two times higher than those of electronics, computers and accessories (US$2.43 billion), and textile and garment products (US$2.3 billion). Total export revenue from phones and phone parts in January-October increased 28.8% year-on-year to over US$36.5 billion. ASEAN and the European Union, the United Arab Emirates, and the United States were the main buyers of phones and phone parts from Vietnam. There were four other groups of items bringing in export revenue of over US$10 billion each in the period, according to the statistics agency. Textile and garment products earned US$21.5 billion, a year-on-year rise of 9.5%; electronics, computers and accessories US$20.9 billion, up 38.8%; footwear with US$11.6 billion, up 11.9%; and machinery, equipment and accessories with US$10.3 billion, up 28%. The nation’s January-October export turnover expanded 20.7% year-on-year to an estimated US$173.7 billion while its import bill reached US$172.5 billion, up 22%, resulting in a trade surplus of US$1.23 billion. Finance Minister: Ratio of budget revenue to GDP not too high  Minister of Finance Dinh Tien Dung, speaking at the ongoing National Assembly (NA) session in Hanoi, said the ratio of State budget revenue to gross domestic product (GDP) is not too high compared to other countries, says a report on VietnamFinance news website. A NA deputy earlier said Vietnam ranks third in the world after Japan and China in terms of the ratios of fee and tax revenues to GDP. Dung said State budget revenue accounts for 23.9% of GDP this year, of which taxes and fees make up 19.7% of GDP. Meanwhile, a report of the International Monetary Fund issued last month showed that the 2016 proportions were 44.3% in European Union (EU) countries, 25.5% in developed and emerging Asian countries, 28.2% in China, 21.3% in India, 22.4% in Thailand and 20.4% in Malaysia. In Vietnam, revenues from crude oil exports, land use fees and proceeds from the sale of state-owned houses go straight to the State budget while in some other countries, such revenues are not included. Some developing countries even include social insurance revenues into their budget revenues, which is not the case in Vietnam. The country has cut taxes more considerably than expected to help enterprises overcome difficulties, thus fueling economic growth. Tax reductions, together with falling crude oil export revenue, have affected tax and fee collections. Fee and tax collections are expected to account for 19.7% of GDP next year, down from 20.1% this year and failing to meet the 21% target for the 2016-2020 period. Dung was quoted by VietnamFinance as saying that the ministry will adjust tax management policies to create favorable conditions for taxpayers and at the same time prevent tax evasion. The Government has asked the ministry to make preparations for sending the amended Tax Law to the NA next year. State budget revenue growth this year is expected at 10.1% over last year. Of which, revenue from domestic production and business activities will edge up 14.1%, offsetting the decline of budget revenue caused by tax deductions and lower crude oil export earnings. In addition, revenue from State-run, foreign-invested and non-State-owned enterprises are not as high as expected as the target this year is much higher than last year, 8.8%, 22.9% and 23.8% higher than last year. Vegetables emerge as major export earner Vegetables have become a major export earner of the country as their export revenue is even higher than that of crude oil, said Nguyen Thien Nhan, secretary of the HCMC Party Committee, at a National Assembly session on November 1. The country last year exported crude oil worth US$2.4 billon, rice US$2.15 billion, coffee US$3.3 billion, fisheries US$7 billion, and vegetables US$2.45 billion, Nhan said, stressing this was the first time export revenue from vegetables was higher than that from crude oil. He said outbound sales of crude oil in 2005 totaled US$7.3 billion, 31 times higher than vegetables (US$235 million). However, the current figure for crude oil represents 98% of that for vegetables. Export revenue from crude oil has dipped by US$5 billion in the past five years. Meanwhile, vegetable exports have soared 30% a year, and the export value of this commodity is forecast to amount to US$10 billion. He proposed adopting policies to prop up vegetable farming to facilitate the export of this produce. Minister of Industry and Trade Tran Tuan Anh said Vietnam has seen strong export growth of agricultural and aquatic products. For example, Vietnamese fruits like dragon fruit, rambutan, longan and litchi have made their way to the U.S. market. Toyota Vietnam lowers auto prices Toyota Vietnam has cut prices of domestically assembled autos by 3% to 9% since Wednesday this week, according to a report on Vietnamnet news website. The Japanese automaker has adjusted down prices of Vios, Innova and Corolla vehicles, except for the Camry, said the report. Toyota Vios TRD has declined by VND58 million (US$2,553) to VND586 million (US$25,820), said Vietnamnet. Other models of the four-door subcompact car like Toyota Vios G, E CVT and MT have marked down by VND48-53 million to VND484-586 million per unit. Toyota Corolla subcompact and compact cars have seen their prices falling by VND24-31 million to VND678-936 million per unit. Notably, Toyota Innova retail prices have dipped by VND42-50 million to VND817-995 million per unit. The special consumption tax for autos with engine capacity of two liters or below is set to be slashed by 5% next year. Vietnam will also reduce import tariffs on auto parts from the Association of Southeast Asian Nations (ASEAN) to 0%, said the Vietnamnet report. Therefore, the average tax on auto parts will be around 5% next year, down from the current 15%, which might result in the automaker revising down its retail prices. Some dealers of Toyota Vietnam in Hanoi were quoted by Vietnamnet as saying that the firm’s selling prices are now equivalent to those of other dealers. This has prompted many customers to buy its vehicles since Wednesday. In a related development, some foreign-invested companies have decided to cancel their import orders for completely-built-up (CBU) autos next January as they have yet to meet the new requirements provided in Government Decree 116/2017/ND-CP on manufacturing, assembly and import of autos, and auto warranty and maintenance services that came into force on October 17. Specifically, they are required to provide the scanned copies of quality certificates for their imported autos issued by competent authorities in exporting countries. Farm exports face more technical barriers Vietnamese exporters will face more technical barriers to trade when they send farm produce to foreign markets in the coming time, according to the Ministry of Agriculture and Rural Development (MARD). At a conference on farm export jointly organized by the Plant Protection Department (PPD) under MARD and CropLife Vietnam in HCMC on November 2, a representative of MARD said that as of October, MARD had received 35 notices from foreign countries about the Maximum Residue Level (MRL) standards for farm produce. PPD’s report shows the contribution of farm exports to the country’s total outbound sales declined from 13% in 2012 to 8.6% in 2016. One of the reasons is Vietnamese farm produce could not meet MRL standards in importing countries. According to PPD, it takes a long time for Vietnam and importing countries to reach agreement on MRL standards and other issues before importing countries allow Vietnamese fruits to enter their markets. Vietnam needs at least two years to wrap up negotiations. Particularly, it took Vietnam eight years to strike a deal to ship dragon fruit to Australia. Japanese tourism promoted in Can Tho The Japan National Tourism Organization (JNTO) on November 2 organized a seminar in Can Tho City in a bid to promote tourism exchanges between Japan and Vietnam’s Mekong Delta. This was the first time the Japanese tourism promotion agency has held such an event in the Mekong Delta city of Can Tho to promote travel to Japan. Takahashi Ayumi, chief representative of JNTO in Vietnam, said at the Visit Japan seminar that there has been an upsurge in Vietnamese tourists to Japan since the Vietnam office of JNTO was opened in March this year. Japan welcomed 230,000 tourists from Vietnam in all of 2016, but in the first nine months of this year, the same number of Vietnamese visitors came to Japan, up 30% year-on-year, the highest growth rate ever, he noted. As for this year, Japan looks to attract up to 300,000 Vietnamese tourists, Takahashi Ayumi said. Among around 20 travel firms showing up at the seminar on November 2 were JTB-TNT, Song Han Tourist and Tagger Travel.  “As Can Tho is the biggest city in the Mekong Delta and a fast-growing market, we hope both sides need more specific information about each other to boost tourism,” he noted. Can Tho City vice chairman Truong Quang Hoai Nam said at the seminar that more than 740,000 Japanese visited Vietnam last year. “However, the number of Japanese arrivals to Can Tho is still small due to a shortage of information for tourists and poor traffic infrastructure in the region.” Nam added the Visit Japan seminar and the Vietnam-Japan culture and trade event which is set to take place in Can Tho this weekend are expected to help both sides attract more tourists. VNA/VNS/VOV/SGT/SGGP/TT/TN/Dantri/VNEVET