BUSINESS IN BRIEF 13/1 Tax payment from state own enterprises sharply reduces in HCMC The tax amount collected from state own enterprises (SOEs) reduced 77.37 percent over 2016 to VND15,768 billion (US$694 million) last year and from local SOEs went down nearly 83 percent to VND6,445 billion, reported HCMC Taxation Department. Conversely, tax payment from foreign invested companies and non-state sector buinesses and service firms moved up 18.88 percent to VND58,019 billion and 13.7 percent to VND48,849 billion respectively. Two revenues strongly increasing from these two economic sectors comprise special consumption tax, up 36.49 percent, and resource tax. Total tax revenue in HCMC was VND238,889 billion, up 16.84 percent over 2016. Of these, crude oil brought VND16,865 billion, raising 18.61 percent. Domestic income excluding oil, lottery and land use fee was VND197,266 billion, increasing 12.1 percent. Da Nang reserves Tet goods worth VND 800bln The Trade and Industry Department of Da Nang city yesterday said that shopkeepers at large scale markets of Han and Hoa Cuong in Da Nang city have prepared for a huge volume of Tet goods with an estimate of VND 150 billion. Additionally, the functional agency also worked with ten enterprises who have reserved 200 tons of rice, 750 tons of meats and 450 tons of dried and frozen foods. The local wholesale markets, shopping malls and supermarkets ensured to reservation of 145 tons of fresh vegetable. Dealers also reserved a huge number of goods for Tet holiday with an estimate of around VND 500 billion. They pledged to keep price stability on the Lunar New Year. Vietnam negotiates trade pacts with 60 economies Vietnam has been negotiating free trade agreements (FTAs) with around 60 economies worldwide, which currently occupy approximately 90% of Vietnam's total trade revenue, heard a meeting in Hanoi, on January 11. The meeting, held by the Inter-sectoral Steering Committee for International Economic Integration, was chaired by Politburo member and Deputy Prime Minister Vuong Dinh Hue. Reports show that Vietnam has so far ratified 10 bilateral and multilateral trade pacts with partners from across the globe, while negotiating the Regional Comprehensive Economic Partnership (RCEP), Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and bilateral FTAs with Israel and Cuba. 2017 marked Vietnam's 22-year membership in ASEAN and the success of the APEC Year hosted by Vietnam, making significant contributions to promoting Vietnam's economic integration. Addressing the meeting, Deputy PM Hue, who is also head of the steering committee, emphasised that 2018 will be an important year for Vietnam as the country strives to fulfil its commitments regarding international economic integration. Vietnam should enhance its competitiveness and complete its institutions in order to actively respond to integration, particularly in the areas facing fierce competition, including breeding and cultivation. Meanwhile, Minister of Industry and Trade Tran Tuan Anh noted that besides boosting international integration, Vietnam should continue promoting domestic integration through the fulfilment of international commitments, institutional reforms, economic restructuring and the renewal of the growth model. Vietnam’s buoyant exports lay firm foundation for 2018      Vietnam’s export revenues rose by over 21% last year to hit approximately US$214 billion, providing a solid foundation for even better results in 2018. Such a strong performance helped Vietnam record a trade surplus of US$2.7 billion, the highest figure in more than a decade. It came partly as a result of the government’s flexible policies, bold efforts to deal with the difficulties facing enterprises and a slew of trade promotion activities. Experts say that local exporters will encounter a great deal of hurdles from continued global uncertainties and growing protectionism, as manifested in more and more anti-dumping cases against Vietnamese goods. Amid a plethora of challenges, Vietnam needs to further step up its international economic integration in 2018 through concrete measures such as accelerating the negotiation, signing and approval of free trade agreements. Such trade pacts will give more room to Vietnamese goods and enhance their competitive edge in the global market. In the meantime, measures are needed to consolidate the presence of Vietnamese goods in established markets, especially those with which Vietnam has continually posted a trade surplus, while also exploring opportunities in new markets by focusing on the goods that are Vietnam’s strength. As for Vietnam’s trade missions abroad, it is advised that they organise more trade promotion events, hold direct talks with Vietnamese exporters and major foreign retailers to advertise Vietnamese goods and seek export opportunities. As a key factor dictating the success of exports, quality needs further improvement by pushing the formulation and application of national quality control standards in harmony with international and regional criteria. The authorities concerned should educate local exporters on the specific rules enforced in major export markets that could potentially become obstacles to Vietnamese goods. For their part, exporters need to customise their products to meet the market demands and proactively adjust their supply chains so that the final products will meet the rule of origin and take advantage of preferential tax rates laid down in Vietnam’s trade pacts with other economies. In addition, they need to familiarise themselves with the unique requirements of each market, fully comply with food safety regulations, and other rules, in order to avoid unanticipated investigations and other trade defence measures. JLL: Supply of southern IPs relatively constant Southern Vietnam’s real estate market witnessed a relatively constant supply of industrial parks in the second half of 2017 compared to the first half, with a total leasable land area of about 24,000 ha, according to the latest report from JLL Vietnam. Of the total, Binh Duong and Dong Nai provinces remained the leading markets, accounting for nearly 60 per cent, given their better accessibility to transportation infrastructure. The vacancy rate at operating IPs stood at approximately 25 per cent as at the end of 2017, down 180 basis points from the same period of 2016 and driven by healthy demand. Healthy performance was observed in existing ready-built factories, which recorded more than 85 per cent occupancy rates due to strong demand and limited leasable stock. As at the fourth quarter of 2017, land rentals in the Southern Key Economic Zone averaged $72 per sq m per lease term, representing an increase of 3.3 per cent year-on-year. By location, rentals in Ho Chi Minh City have long held the lead in the south, at nearly double the regional average. Net land rentals in other southern cities saw an upward trend, within the range of $3 to $5 per sq m for the lease period. Factory rentals were relatively unchanged compared to previous quarters, at between $2 and $5 per sq m per month. The report also noted that more than 1,300 ha of supply now in the pipeline is expected to enter the southern market over the next year, mostly from expansions at existing projects. Occupancy and rental growth rates are both expected to go higher due to active occupier demand and positive economic prospects. Demand for good quality, ready-built space and related services at industrial parks will likely increase strongly. Red Wok invests in Quan Ut Ut chains The Red Wok Cuisine Joint Stock Company has announced an investment in the Quan Ut Ut Barbecue and Bia Craft restaurant chains. This is part of Red Wok’s market expansion strategy, which includes conducting investments in small-scale businesses that have four to ten restaurants and providing support to restaurant chains in terms of management experience to boost its competitive advantages. In addition to its financial investment, Red Wok will also support the restaurant chains in financial management consulting, human resources, IT, marketing, and market development. This will help provide greater competitive advantages for the Quan Ut Ut and Bia Craft chains in the future. The investment is also part of Red Wok’s market expansion strategy from now to 2021, to become the Vietnamese cuisine group with the most popular restaurant chains in the country. “We have always been focusing on building brands based on understanding customer insights,” said Ms. Tran Thi Lan Anh, CEO of Red Wok Cuisine. “We decided to invest in Quan Ut Ut and Bia Craft in the belief that they are popular barbecue and craft beer restaurant chains in Ho Chi Minh City and hold strong potential for developing nationwide.” The Quan Ut Ut Co., Ltd. is the current owner of the Quan Ut Ut Barbecue and  Bia Craft chains, which are popular among the city’s young. The concept of restaurants selling craft beer is an innovation in Vietnam, with beer brewed in microbreweries using traditional brewing procedures combined with diverse ingredients to create a distinctive taste. At Quan Ut Ut and Bia Craft restaurants, all dishes and craft beer are modified to suit the Vietnamese palate. Moreover, its designs are imbued with the liberal style seen on Ho Chi Minh City streets, bringing a comfortable feeling for customers. “Red Wok is a great partner to have on board,” said Mr. Tim Scott, General Director of the Quan Ut Ut Co. “Through this collaboration and by leveraging each company’s strengths, we look forward to innovative growth, new perspectives, and challenging the status quo. We are excited about the opportunity to bring our American BBQ and craft beer concepts to an even wider audience.” According to Mr. Chad Ovel, Partner at Mekong Capital, in 2017, Red Wok completed its transformation from a company with a single restaurant concept, Wrap and Roll, to a multi-concept restaurant group. “Red Wok has demonstrated that it can both successfully launch its own concepts and grow together with other restaurant entrepreneurs by providing them with growth capital and valuable coaching from proven and tested restaurant leadership veterans,” he said. “Red Wok is highly committed to the future growth of Quan Ut Ut and Bia Craft given the strong fit of these concepts with Vietnamese consumer preferences and the big vision of the company’s founders.” In 2016, Mekong Enterprise Fund III - managed by Mekong Capital, a private equity fund manager - invested $6.9 million in the Wrap and Roll Restaurant Joint Stock Company. Vietnam again fifth in consumer confidence in Q3 2017 Consumer confidence in Vietnam stood at 116 in the third quarter of 2017, down 1 point from the second quarter, seeing it remain the fifth most-optimistic country globally, after India, the Philippines, Indonesia, and the US, according to the latest Consumer Confidence Index from market researchers Nielsen. “Overall, consumer confidence in the Southeast Asian region strengthened modestly,” said Ms. Nguyen Huong Quynh, Managing Director of Nielsen Vietnam. “In Vietnam, our consumers are optimistic, maintaining confidence throughout 2017. This consistent trend is enhanced by consumers’ optimistic perception of their personal finances and immediate spending intentions, and may be also buoyed by the good momentum in GDP growth in the first nine months of the year, with surging inflows of foreign investment, growth in household income, and a falling unemployment rate.” “Many respondents in Vietnam said they expected their personal finances to be good or excellent in the coming year and expressed optimism about job prospects,” Ms. Quynh went on. “These perceptions are reflected in the overall trend towards high confidence observed over past years. Reasons may be related to the fact that Vietnam is a country where young consumers share a view of hope for better living conditions, higher incomes, better education for their children, and expectations of improvements in the next year.” Saving continues to be an integral part of Southeast Asian consumers habits, with more than three in five respondents (67 per cent) putting their spare cash into savings. “Consumers in Vietnam are certainly consistent in their desire to build a nest egg for the future, and quarter after quarter we observe this trend,” Ms. Quynh said. “So, saving is a way of life for a majority of Vietnamese consumers because of this ingrained desire. However, they are also more willing to open their wallets for discretionary spending on holidays, recreational activities, upgrading technological gadgets, making home improvements, and so forth, in order to reflect their eagerness to have a better life.” “It is understandable that consumers want to secure their position at the workplace, as working is the only way to make all their desire becomes a reality,” said Ms. Quynh. “Also, in the current context, when being bombarded with a great deal of information on the internet and media about food safety and quality, leading a healthier life becomes a top-of-mind mandate for all consumers so that they can have greater longevity.” Tax authorities puzzled over Airbnb tax obligations Despite Airbnb being present in Vietnam since 2015 and operating with profit, it is difficulty for tax authorities to tax the company as it does not yet have a business registration licence or a representative office and legal representation in Vietnam. Airbnb has been available in Vietnam since 2015, connecting people seeking accommodation with those looking to rent via a technology platform, taking a fee after transactions. The number of rooms for rent increased from the initial 1,000 to 10,000 by the end of last year, primarily in Hanoi and Ho Chi Minh City, according to the latest research from Grant Thornton Vietnam. Meanwhile, thousands of apartments and villas in Halong, Sapa, and Danang are for rent on the platform, with prices 30 per cent cheaper than comparable hotels. Hanoi has been ranked sixth among the 10 destinations with the highest increase in bookings in 2017, according to Airbnb. Airbnb joined Uber and Grab as the most recognisable new “sharing” business models that have changed the way people around the world access and use services. It not only has a large-scale business network with reasonable fees, it also creates a connection between hosts and customers. Notably, hosts are willing to help and take care of customers in case they have a health problem. Beside, comment threads between hosts and customers are published on the Airbnb website and only the company has the right to delete these comments. It makes it easy for customers to select the best accommodation and help the host avoid bad customers. Regarding the fees, customers will have to pay between 10-15 per cent of the booking price to Airbnb and the host 3 per cent. For example, the listed price at accomodations for rent is $50 per night, however, customers who book accomodation via Airbnb will have to pay between $60-75. Payments can only be made via credit card. Despite Airbnb’s operating in Vietnam since 2015, the Ho Chi Minh City Department of Taxation and the Ho Chi Minh City Department of Tourism have yet to extend supervision over Airbnb’s operations. Even a number of tourism companies were unaware of Airbnb's services in Vietnam, despite its fast growth. Le Thi Thu Huong, deputy director of the Ho Chi Minh City Department of Taxation, told VIR that since May 2017, the department had been trying to bring the company’s operations under management and requesting the company to pay tax, with no effect. Huong stated that in Ho Chi Minh City alone, there are 2,074 hosts looking to rent out space via Airbnb, which is a large number, thus tax collected from Airbnb would contribute a part to the city’s budget. According to lawyer Nguyen Huu Phuoc, founder of Phuoc & Partners Law Company, Airbnb has yet to register its business in Vietnam, however, Circular No.103/2014/TT-BTC dated August 6, 2014, shows that foreign business organisations, regardless of having permanent establishments in Vietnam or not, as well as foreign business individuals, regardless of their place of residence, (foreign contractors and foreign sub-contractors) who do business in Vietnam or earn income in Vietnam from contracts, agreements or commitments with a Vietnamese entity, are subject to tax. Thus, regarding the law, there is ample legal basis to identify tax obligations for Airbnb. However, Phuoc added that in reality, it is still difficult to manage and ask Airbnb to pay tax because the payments are only made via credit card without any bills. Vung Ro Petroleum shakes hands with DenimoTech Vung Ro Petroleum Co., Ltd. (VRP), the operator of Vietnam's third oil refinery located in the central province of Phu Yen and backed by the UK-based Technostar Management Limited, today signed a co-operative agreement with DenimoTech, a Denmark-headquartered firm, aiming to provide turnkey solutions for the petroleum by-product sector and aid the implementation of VRP’s new manufacturing plant in Vietnam. Specifically, the Danish industrial product manufacturer committed to team up with $3.2 billion Vung Ro oil refinery in the construction of a high-tech state-of-the-art bituminous binders processing plant, utilising green technology from Denmark. The plant will have a storage capacity of 12,000 tonnes with a second phase upgrade to 30,000 tonnes. It is expected to be a top-notch environmental friendly bitumen emulsion and polymer modified bitumen plant, which is also a state-of-the-art packing facility to facilitate exports of hi-tech bituminous products to regional markets. Kirill Korolev, general director of Vung Ro Petroleum told VIR that it is expected to start the first phase development this year. He said that this plant is part of Vung Ro Petroleum’s attempt to produce its own high-quality bituminous binders compliant to Vietnamese standards, American Superpave Performance Grade standards and other standards required by customers in the region. He added that “this project will contribute significantly to Vietnam’s infrastructure development. The road, airport and port infrastructure of a country are barometers for its advancement, wealth and prosperity.” “We, at Vung Ro Petroleum, are proud to contribute to this development with our full commitment and selecting the world’s best technology providers to bring possibly the best materials and science to the Vietnamese market,” Korolev added. While, Bernd Schmidt, CEO of Bitumina Group and chairman of DenimoTech, asserted that “Together with our partners, international vendors and some of our best scientists from Denmark, we will deliver a cutting-edge facility and technology for Vung Ro Petroleum and help bring in pavement design which has longer-life and can solve the local engineering problems of the Vietnamese construction and industrial sectors.” Trà Vinh Province seeks investment in 10 agricultural projects Trà Vinh Province is calling for investment in 10 agricultural projects that are part of a plan to develop the area’s agriculture and improve the lives of farmers. The projects, worth a total of VNĐ969 billion (US$42 million), include a freshwater pond in Duyên Hải District’s Đôn Châu Commune; a quality assurance programme for agriculture and aquatic products; animal husbandry projects; new factories for processing meat and fodder; and other programmes to boost agriculture and fishery. The province’s Department of Agriculture and Rural Development targets increasing agriculture earnings by 4 per cent by the end of the year. Agricultural businesses currently account for only 6 per cent of businesses operating in Trà Vinh. M&A deals increase Chinese investment in Vietnam Chinese businesses tend to make their stronger presence in Vietnam through mergers and acquisitions (M&A) deals, especially in real estate. Chen Dehai, Chinese Consul General in Ho Chi Minh City, said at a recent meeting to promote investment opportunities in the city that Chinese investment into Vietnam has surged high since 2016. Businesses have poured much capital in different projects in thermal and wind power, solar energy pin, garment, and tyre production, even up to US$2 billion in one project. According to the Foreign Investment Agency under the Ministry of Planning and Investment, China ranked fourth among foreign investors with the highest amount of investment capital pledged for Vietnam last year. 2017 also witnessed many M&A deals between Chinese businesses and Vietnamese partners in real estate. Chinese businesses have not only focused on M&A deals and real estate but also increased their investment in industrial production. They tend to invest in garment, fibre and footwear to take advantage of tax incentives when exporting to the EU and US as Vietnam have signed free trade agreements with these countries. A clear proof for the move is that the Bank of China, Ho Chi Minh City branch and China’s Shenzhen Stock Exchange signed a cooperation deal in December 2017 to further attract Chinese investment into Vietnam. High-tech bitumen plant to be built in Phu Yen Danish global machinery equipment maker DenimoTech and Vung Ro Petroleum Company Limited on January 11 signed an agreement to build a high-tech bitumen plant in the central coastal province of Phu Yen. The construction of the plant will be divided into two phases. The first will be implemented in a year, and the second will begin in the middle of the year and last for 26-28 months. During the first phase, the plant will import high quality bituminous binders from the world’s leading manufacturers and process them into advanced construction materials for both the Vietnamese market and exports to neighbouring countries. The plant has been designed to have a storage capacity of 12,000 metric tonnes (MT) with a second phase upgrade to 30,000 MT. It is expected to be a top-notch environmentally-friendly bitumen-emulsion and polymer-modified bitumen plant. It will also be a state-of-the-art packing facility for exports of hi-tech bituminous products to regional markets. It will have its own port facility. The plant is part of Vung Ro Petroleum’s attempt to produce its own high-quality bituminous binders compliant with Vietnamese Standards, American Superpave Performance Grade Standards and other standards required by customers in the region. Kirill Korolev, CEO of Vung Ro Petroleum, believes that the project will contribute significantly to Vietnam’s infrastructure development. “The road, airport and port infrastructure of a country are barometres for its advancement, wealth and prosperity. We are proud to contribute to this development. We are selecting the world’s best technology providers to bring the best materials and science to the Vietnamese market,” Kirill said. Vung Ro Petroleum’s CEO said he was not authorised to disclose the full amount of the investment, but said it was above 500 million USD. “Together with our partners, international vendors and some of the best scientists from Denmark, we will deliver a cutting-edge facility for Vung Ro Petroleum and help solve the engineering problems of Vietnamese construction and industrial sectors,” said Bernd Schmidt, chairman of DeminoTech. Vung Ro Petroleum shakes hands with DenimoTech Vung Ro Petroleum Co., Ltd. (VRP), the operator of Vietnam's third oil refinery located in the central province of Phu Yen and backed by the UK-based Technostar Management Limited, signed a co-operative agreement with DenimoTech, a Denmark-headquartered firm on January 11. The agreement aims to provide turnkey solutions for the petroleum by-product sector and aid the implementation of VRP’s new manufacturing plant in Vietnam. Specifically, the Danish industrial product manufacturer committed to team up with $3.2 billion Vung Ro oil refinery in the construction of a high-tech state-of-the-art bituminous binders processing plant, utilising green technology from Denmark. The plant will have a storage capacity of 12,000 tonnes with a second phase upgrade to 30,000 tonnes. It is expected to be a top-notch environmental friendly bitumen emulsion and polymer modified bitumen plant, which is also a state-of-the-art packing facility to facilitate exports of hi-tech bituminous products to regional markets. Kirill Korolev, general director of Vung Ro Petroleum told VIR that it is expected to start the first phase development this year. He said that this plant is part of Vung Ro Petroleum’s attempt to produce its own high-quality bituminous binders compliant to Vietnamese standards, American Superpave Performance Grade standards and other standards required by customers in the region. He added that “this project will contribute significantly to Vietnam’s infrastructure development. The road, airport and port infrastructure of a country are barometers for its advancement, wealth and prosperity.” “We, at Vung Ro Petroleum, are proud to contribute to this development with our full commitment and selecting the world’s best technology providers to bring possibly the best materials and science to the Vietnamese market,” Korolev added. While, Bernd Schmidt, CEO of Bitumina Group and chairman of DenimoTech, asserted that “Together with our partners, international vendors and some of our best scientists from Denmark, we will deliver a cutting-edge facility and technology for Vung Ro Petroleum and help bring in pavement design which has longer-life and can solve the local engineering problems of the Vietnamese construction and industrial sectors.” HCM City retail grows by more than 11% in 2017 HCM City’s retail sector has been growing steadily, achieving an 11.3 per cent increase by the end of 2017 compared to 2016, according to the city’s Department of Industry and Trade. According to the department, the total revenue of the retail sector last year was over VNĐ923.84 trillion (US$40 billion). Revenue from retail sales was VNĐ594.65 trillion, accounting for 64.4 per cent of total retail revenue (retail sales and retail services). The city had 207 supermarkets in 2017, an increase of 18 compared to 2016. At least 116 of them are domestic supermarkets, while 91 are foreign-owned. In addition, there were around 43 shopping malls in 2017, three more than in 2016. Fourteen of them are foreign owned. There were around 1,100 convenience stores in 2017, 218 more compared to 2016. HCMC to host Blockchain Week     The 2018 Vietnam Blockchain Week will be held in HCM City in March to promote the potential of blockchain and 4.0 technologies. Organised by Infinity Blockchain Labs (IBL), the event also aims to highlight Viet Nam’s position as a global hub of 4.0 technologies and advocate support from Vietnamese regulators to create a facilitating and nurturing environment for blockchain and 4.0 technologies. The event expects to attract 1,500 participants to demonstrate how blockchain is transforming the global economy and how Viet Nam is poised to become the next global blockchain and 4.0 technologies hub. By inviting only top tier speakers, thought leaders, business leaders and regulators from Viet Nam and the world in various realms of blockchain and other 4.0 technologies such as AI, VR/AR, and the Internet of Things, the organisers hope to use the event to help the Vietnamese tech community position itself in the global market. It will be held on March 7 and 8 at Riverside Palace in District 4. The blockchain concept is one of the most transformative and game-changing ideas since the Internet. It is a public transaction ledger built in a network structure based on cryptographic principles which removes the need for intermediaries while generating massive transactional applications to establish trust, accountability and transparency at lower costs, with fewer legal constraints and with less system friction. Blockchain technology goes well beyond cryptocurrencies, fintech, public voting, data sharing networks, and decentralised marketplaces and interacts with other cutting-edge technologies such as artificial intelligence, the Internet of Things and Big Data. Blockchain is in fact heralded as the backbone of 4.0 technologies. Currently tech juggernauts such as IBM, Microsoft and Google and international banks are engaged in a blockchain research and development race on a global scale. Thanks to its geopolitical stability and one of the world’s highest growth rates, Viet Nam has gained a global reputation in the ICT industry though still only as an outsourcing hub, according to IBL. The inherent novelty, tremendous potential and range of possibilities of blockchain and other 4.0 technologies will undoubtedly enable Viet Nam to thrive, especially its ICT industry, it said. HDBank, a good stock for investment     With HDBank listing 981 million shares on the HCM Stock Exchange on Jan 5, the Vietnamese market now has another quality stock for investors. On the first day of trading, HDB gained 20 per cent to reach the ceiling price of VND39,600 (US$1.75). Volumes topped 32.3 million, with foreign investors snapping up more than five million shares. The bank's strong growth outlook is what makes the stock highly attractive to investors. Prior to its market debut, HDBank, formally known as the HCM City Development bank, had increased its chartered capital to VND9.8 trillion. Last month it raised more than $300 million by selling a 21.5 per cent stake to 76 foreign investors, including from the UK, Hong Kong, the US, Japan, Singapore, South Korea, and Australia. The remaining 8.5 per cent of the bank’s shares open for foreigners to buy is making HDB a buy when other listed banks have no further room for foreign investors. Another factor is that HDBank has become well-known thanks to the high profile of its board, which includes deputy chairwoman Nguyen Thi Phuong Thao, who is also the founder of no-frills airline Vietjet Air, and chairwoman Le Thi Bang Tam, who also chairs Vinamilk — the largest firm by market cap on the Vietnamese stock market. On the first day of trading of HDB, Thao said: "We have built a foundation for the 2017-2021 plan which includes annual targets of 25 per cent growth and 37 per cent growth in profits and serving 15 millions customers by 2021. "In the last 10 years HDBank's total assets have grown 18-fold and we believe in our ability to grow the assets another 2.5-fold by 2021 in addition to keeping the lowest bad debt ratio in the whole [banking] sector." Speaking on the listing day, deputy governor of the State Bank of Viet Nam, Nguyen Dong Tien, said HDBank is a successful case of the country's banking sector reforms in 2012-2015. HDBank has done a remarkable job to become one of the top banks in the country, he added. "Being the first credit institution to list on HoSE in 2018 not only marks a new chapter for HDBank, but also reaffirms its leaders' commitment to work towards transparency and ensuring the best interests of its customers, which is also in the best interests of the market, its investors, and shareholders." HDBank's successful listing on the stock market and status as one of the largest firms by market cap has created a positive outlook for the country's financial system and reaffirmed its attraction to international investors, he said. Established in 1990, merged with Dai A Bank in 2013 and buyer of France’s Société Générale Viet Finance, HDBank has become among the largest lenders in Viet Nam. As of December 2017 the bank had total assets worth more than VND191 trillion and capital in excess of VND15 trillion. Its pre-tax profit last year was VND2.42 trillion following a 110 per cent jump from 2016. It has a low bad debt ratio of 1.1 per cent, which rises to 1.5 per cent if non-performing loans (NPLs) at its retail financial company HD Saison are taken into account. Even during the dark days for the financial system a few years ago the bank always ensured it paid a 10 per cent dividend to its shareholders. Recently it announced a cash dividend and bonus payout of 25-30 per cent at this year shareholders meeting. HDBank targets 26 per cent growth in assets annually for the next five years with total assets rising to $20 billion and return-on-equity of 26 per cent. It also does not rule out the possibility of more M&A deals in the near future. HDbank has garnered many domestic and international awards, including the award for “Best Cash Managing Bank in Viet Nam” from AsiaMoney Magazine for five straight years (2012-16) and "Best Managed Company in Asia" award in 2015 and 2016 from British magazine Euromoney. Moody’s Investors Service assigned HDBank a first-time credit rating of B2 with a stable outlook for 2016. HDBank has been named among the 500 strongest banks in the Asia Pacific region and among the best commercial banks in Viet Nam by the Asian Banker. Company reports must meet world standards     Credit-risk management should be enhanced to make sure business information was transparent and reliable to improve Viet Nam’s trade, economic and investment conditions, according to Nguyen Quang Thuan, CEO from data analysis firm StoxPlus. Thuan said credit-risk management was normally referred to as a core business activity done only by the banking-financial sector. However, he said potential risks may also pose threats to the country’s trade and investment environment if they were not fully addressed. Transparent business and economic information and data would help strengthen international trade between Viet Nam and other economies, draw more attention from foreign investors, improve the performance of local businesses and help them accessl foreign capital markets, Thuan said at a workshop yesterday. At the moment, “the reliability of data inputs in Viet Nam is still weak given the fragmented data-source infrastructure and poor financial reporting environment,” Thuan said. In addition, better credit risk and business data management would provide local banks better insight of the finance and operation of local businesses, he said. “As banks conduct insightful reviews of company profiles, they are able to determine whether the businesses are strong enough and whether lending rates should be high or low based on the financial risks that the business may encounter,” Thuan said. Credit risk and data management would help local authorities prevent foreign companies from transfer pricing, which is used to avoid taxation, and improve the quality of foreign investment in the economy, he added. In fact, there was a big difference between a company’s financial statement sent to the tax authority and the one sent to credit institutions for making loans, Thuan said. “We find out in some cases that if companies do not issue tax invoices for the products sold in the market, they do not have to record the transactions in the financial reports for tax purposes to avoid business income tax. But they can record the transactions in the financial statements submitted to the banks for credit purposes.” Therefore, Thuan urged authorities to empower independent third-party vendors that have technological advances, such as StoxPlus, to collect and analyse financial and economic data so that the information was transparent and reliable for investors. Agreeing with StoxPlus CEO, World Bank Vietnam lead financial sector specialist Alwaleed Alatabani said that the local authorities must compel companies to improve their financial statements and reports to meet international standards. He said that local authorities also needed to work with financial institutions on corporate earnings reports so that the country would provide better business environment and give foreign investors better insight into the Vietnamese economy. Complast plastics exhibition opens in HCM City     Hundreds of new plastic products and the latest equipment and machines are on display at the 3rd international complete plastics exhibition (Complast Vietnam 2018), which was opened on Wednesday in HCM City. Smart Expos and Fair (India) Pvt. Ltd (SEFIPL) organised the fair in co-operation with Viet Nam Plastics Association (VPA) at the Saigon Exhibition & Convention Centre (SECC) in District 7. Processing machines and technologies as well as chemicals, additives, test equipment and recycling services will be on display, among many other items. The three-day expo includes hundreds of exhibitors from 21 countries and regions, including India, Taiwan, China, South Korea, Japan, Singapore, Malaysia, Thailand, Philippines, Indonesia, Laos, Cambodia, Africa, the Middle East, Egypt, Iran, Turkey, Greece, UAE, Australia, Italy and Sri Lanka. Visitors can interact with global corporations and hundreds of plastic industry solution providers. A seminar will be held on the sidelines of the expo on 3D printing technology for making tools, advanced recycling of plastic waste, and knowledge sessions on recycling plastics in Viet Nam. Investment opportunities in the industry are promising as the country has high-growth prospects, significant dependence on imported raw materials and processing machineries, and a high level of plastics exports. PricewaterhouseCoopers said that Viet Nam could become one the fastest-growing of the world’s emerging economies by 2025, with a potential growth rate of almost 10 per cent per annum. Customs revenue surpasses target      Revenue from the General Department of Customs (GDC) in 2017 hit VND297 trillion (US$13 billion) last year, a year-on-year increase of 9.5 per cent and equivalent to a 4.3 per cent increase on the annual target. This was revealed at a press conference by the GDC in Ha Noi on Thursday. Regarding post-customs clearance inspections, the GDC has instructed local customs departments to focus on common, illegally trafficked products with high turnover, high tax rates and high risk of wrong codes and prices, such as automobiles, liquors, beer, paper and cosmetics. In 2017, the GDC carried out nearly 9,000 post-customs clearance inspections, including 1,300 inspections at companies and more than 7,200 at local customs offices. The department also boosted inter-sectoral co-operation to prevent and detect smuggling and trade fraud. There were fewer smuggling cases unearthed in 2017, but they were high in value. Customs officers last year discovered 15,184 violation cases, down 1.97 per cent annually. However, the value of smuggled goods was more than VND789 billion, up 89.58 per cent year-on-year. A total of VND334.8 billion of this was added to the State budget, marking a 95 per cent surge from 2016. At border gates, smuggled goods were mostly foreign currencies, counterfeit money, alcoholic beverages and beer, cigarettes, sugar, poultry, food, apparel, footwear, mobile phones, and toys. Meanwhile, at sea ports, petroleum, timber, minerals, wildlife and second-hand electronic and refrigeration appliances continued to be smuggled. Banned goods of high value, such as addictive substances, weapons, gold, and wildlife products were found among goods transported by air and post. The customs sector launched criminal probes against 51 cases and transferred 68 others to other units for prosecution. Luu Manh Tuong, director of the Import-Export Tax Department, said import tariffs would be cut following Viet Nam’s commitment to the ASEAN Trade in Goods Agreement (ATIGA) as well as with many other free trade agreements, including the ASEAN-China Free Trade Area and the ASEAN-Republic of Korea Free Trade Agreement. This, Tuong said, would significantly reduce import tax revenues and affect State budget collection. Addressing the conference, Minister of Finance Dinh Tien Dung asked the customs sector to raise State budget collection by 3-5 per cent higher than the amount assigned by the National Assembly. To realise the target, Dung asked the GDC to tighten post-clearance inspections and intensify the fight against trafficking and trade fraud, along with accelerating the collection of overdue tax. The minister stressed the role of a legal framework for the national single window and information exchange with trade partners. He also instructed the efficient implementation of the project on monitoring seaports and infrastructure improvement for customs management. Quang Nam strengthens ties with foreign localities The central coastal province of Quang Nam will enhance relations with foreign localities and develop sound ties with foreign diplomatic agencies and international and non-governmental organisations in the province in service of its socio-economic growth. Chairman of the provincial People’s Committee Dinh Van Thu made the statement at a meeting on January 11 with 350 representatives from foreign organisations and businesses having investments in the locality. Despite complex developments in the world and regional politics and security, climate change and natural disasters in 2017, Quang Nam province made concerted efforts, overcame challenges and gained remarkable achievements, he noted. The locality successfully organised a wide range of important diplomatic events which left overwhelming impression on international visitors and friends like the 6th Quang Nam Heritage Festival, Korean culture day in Quang Nam, Hoi An-Japan Cultural Exchange, Quang Nam-Sekong high-level meeting and events held within the framework of the APEC Year 2017. Thu stressed that twining relations between the locality and Laos’s Sekong province are developing with many activities to celebrate the 55th anniversary of diplomatic ties and 40 years of signing the Treaty on Amity and Cooperation between the two countries. Also, the province inked and is carrying out cooperation deals with the Republic of Korea’s Osan, Yongin and Gwangyang cities, Japan’s Nagasaki prefecture, Thailand’s Ubon Rathchathani and France’s Cotes d’Armor. During 2016-2017, it welcomed 70 foreign delegations with more than 700 visitors. It granted investment licences for 30 new FDI projects with total registered capital of more than 200 million USD, helping create jobs for 20,000 local labourers. The province has accompanied non-governmental organisations in 240 programmes and projects with total sponsored value of 20 million USD. National one-stop-shop portal facilities chemical declaration Imported chemicals will be declared via the national one-stop-shop portal from January 11, 2018. The Departments of Chemicals, and E-commerce and Digital Economy under the Ministry of Industry and Trade officially launched the service in Hanoi on January 11. Addressing the event, Deputy Minister of Industry and Trade Do Thang Hai said with the freshly-launched procedure, the ministry has, to date, carried out 24 public services allowing individuals and organisations to pay fees online, including six administrative procedures implemented via the national one-stop-shop mechanism.  Nguyen Van Thanh, head of the Chemical Department, said it takes businesses only about 15 seconds get the results of declaration via the portal as compared with at least five days in the past. According to statistics released by the department, about 70,000 chemical declaration dossiers of nearly 4,000 enterprises are submitted to the ministry annually. The declaration process had been conducted online or at the ministry’s headquarters traditionally, and the results had been given back to enterprises were in papers. Efforts called for stronger int’l economic integration Deputy Prime Minister Vuong Dinh Hue has stressed a strong change in international economic integration in 2018, focusing negotiations on and signing of new free trade agreements (FTAs), and improving legal frameworks towards realising signed trade pacts with foreign partners. Speaking at the first meeting of the Inter-sectoral Steering Committee for International Economic Integration for 2018 in Hanoi on January 11, the Deputy PM asked the committee to coordinate with the Ministry of Industry and Trade, other ministries and sectors in effectively tapping signed FTAs, and proposing measures to promote the signing of new pacts. According to Deputy PM Hue, who is also head of the committee, they need to keep close watch on policy-related changes of partners and response from foreign markets in order to give timely warnings to local businesses. More efforts should be done to improve Vietnam’s integration capacity, while attention should be paid to outlining trade protection policies, he noted. He highlighted the carefulness in the negotiation process to ensure the best benefit for the country. The Deputy PM called for measures to ensure tax collection in the context of the country’s deeper international integration which will cause tariff reduction. Participants underlined the significance of coordination in negotiating new FTAs and performing ones signed in 2018 - the year they described as an important time for implementing Vietnam’s international economic integration commitments. Vietnam has so far approved 10 bilateral and multilateral FTAs with regional and international partners. The country basically finished FTA negotiation with the European Union. It is promoting negotiations on the Regional Comprehensive Economic Partnership (RCEP), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and discussions towards bilateral pacts with Israel and Cuba. The implementation of FTAs remarkably contributed to pushing the national economic development and expanding export markets, thus helping Vietnam deeply join the global value chain and production network. It also helped accelerate economic restructuring, improve business climate and competitiveness, and effectively take advantages of investment flows, technology and knowledge, and create more jobs, thus raising management capacity. Vietnam witnessed fruitful economic development in 2017, with export-import turnover hitting 425 billion USD. Vietinbank lowers interest rates for loans to five priority fields The Vietnam Bank for Industry and Trade (VietinBank) has decided to reduce interest rates for short, medium and long term loans to five sectors deemed as priority by the Government. The decision is taken in line with the Government’s Resolution No. 01/NQ-CP dated January 1, 2018, and the direction of the State Bank’s Governor. Accordingly, as from January 11, interest rates will be cut by 0.5 percent per year for short, medium and long term loans in Vietnamese dong to firms operating in agriculture-rural development, for-export production and business, small- and medium-sized enterprises, support industry and hi-tech production. Start-up firms with feasible business and production plans and household businesses that were upgraded into official firms, are also eligible for the preferential loans. Besides, credit programmes with special interest rates will continue to be applied to businesses with good financial status and effective production and business activities. Lending to five priority sectors of the Government account for nearly 60 percent of Vietinbank’s total outstanding loans, which demonstrated the bank’s vanguard role in implementing policies of the Party, the Government and the State Bank, as well as in providing capital to the national economy’s key fields. Customs sector aims to raise state budget collection in 2018 Minister of Finance Dinh Tien Dung has asked the customs sector to raise state budget collection by 3-5 percent higher than the amount assigned by the National Assembly. The official made the requirement during an online conference held on January 11 to review the sector’s work and launch new tasks in 2018. To realise the target, Dung asked the General Department of Vietnam Customs (GDC) to tighten post-clearance inspections and intensify the fight against trafficking and trade fraud, along with accelerating the collection of overdue tax. The minister stressed the role of a legal framework for the national single window and information exchange with trade partners. He also instructed the efficient implementation of the project on monitoring seaports and infrastructure improvement for customs management. In 2018, the NA tasked the customs sector with the collection of 283 trillion VND (12.46 billion USD) for the State budget in the context of import tax reduction for many commodities under free trade agreements Vietnam has signed with partners. GDC Director General Nguyen Van Can said the GDC will take measures to prevent tax losses and evaluate impacts of Vietnam’s commitments on international integration on budget collection. Besides, it will devise appropriate solutions to recover tax overdue, while intensifying the fight against smuggling and trade fraud. GDC statistics showed that customs sector collected over 297.08 trillion VND (13.08 billion USD) for the State budget at the end of 2017, a rise of 9.47 percent year-on-year and 4.24 percent higher than the estimated figure adopted by the NA. Complast plastics exhibition opens in HCM City     Hundreds of new plastic products and the latest equipment and machines are on display at the 3rd international complete plastics exhibition (Complast Vietnam 2018), which was opened on Wednesday in HCM City. Smart Expos and Fair (India) Pvt. Ltd (SEFIPL) organised the fair in co-operation with Viet Nam Plastics Association (VPA) at the Saigon Exhibition & Convention Centre (SECC) in District 7. Processing machines and technologies as well as chemicals, additives, test equipment and recycling services will be on display, among many other items. The three-day expo includes hundreds of exhibitors from 21 countries and regions, including India, Taiwan, China, South Korea, Japan, Singapore, Malaysia, Thailand, Philippines, Indonesia, Laos, Cambodia, Africa, the Middle East, Egypt, Iran, Turkey, Greece, UAE, Australia, Italy and Sri Lanka. Visitors can interact with global corporations and hundreds of plastic industry solution providers. A seminar will be held on the sidelines of the expo on 3D printing technology for making tools, advanced recycling of plastic waste, and knowledge sessions on recycling plastics in Viet Nam. Investment opportunities in the industry are promising as the country has high-growth prospects, significant dependence on imported raw materials and processing machineries, and a high level of plastics exports. PricewaterhouseCoopers said that Viet Nam could become one the fastest-growing of the world’s emerging economies by 2025, with a potential growth rate of almost 10 per cent per annum. Friends for life: Vietnam insurance demand rises Life insurers are gearing up for a busy year ahead as the market for insurance products in Vietnam is expected to boom in the near future. 2018 is slated to be a promising year for foreign life insurers in Vietnam. The life insurance market already grew by 30 per cent in 2017, backed by Vietnam’s stable macro-economics, emergent middle class, and strong consumer demand. Industry insiders expect the same growth rate for this year, which is prompting insurers to up their game right as the business year begins. AIA Vietnam is one such example. The insurer signed a new bancassurance deal with Viet Capital Bank last week, following a series of partnerships with other lenders such as HSBC, DongA Bank, and VPBank in 2017. Wayne Besant, CEO of AIA Vietnam, told VIR that bancassurance will be an important distribution channel for the firm, as more Vietnamese open bank accounts and expect more sophisticated services from financial firms. “We expect to ‘walk on two strong legs’, which means we’ll continue the traditional agency distribution method as well as boost bancassurance partnerships,” said Besant. The CEO revealed that in 2017, bancassurance was the fastest-growing channel for AIA in Hanoi and Ho Chi Minh City. It is easy to see that bancassurance will continue to be a buzzword for the industry in 2018. Traditionally, foreign insurers opt for agents, which still account for 90 per cent of new business premiums in Vietnam. However, the sector’s over-reliance on agents, especially general agents without any exclusive ties to any insurer, has caused problems in the agent selection process, staff turnover rates, and quality assurance. This has required life insurers to seek out bancassurance partnerships, in addition to this channel helping the core mission of educating Vietnamese consumers on personal finance. Insurers hope that as more Vietnamese become acquainted with the concept of life insurance, the insurance market will grow. Room for market expansion is huge, as only 6 per cent of the Vietnamese population currently has an insurance contract, which is among the lowest rates in the Asia-Pacific region. Larry Madge, CEO of Sun Life Vietnam, believes that Vietnam’s stable interest rates, strong GDP growth, and better financial literacy will bode well for life insurers. “We believe that in 2018, Vietnamese consumers will have stronger demand for tailored products on personal finance,” Madge said. Similarly, managing director of Manulife Vietnam Paul Nguyen pointed out that Vietnam’s middle class is growing rapidly, which means more people will be willing to use part of their income to invest in retirement or financial protection solutions, including life insurance. The ageing population here will also drive up demand for wellness and retirement products.    Nguyen said that in the next three years, Manulife Vietnam will strive to be “the trusted partner that helps people live positively”. Unlike other insurers who use general agencies, Manulife Vietnam prefers to have a tied agency system in order to control the quality of its agents. Bancassurance will be another focus, with the insurer aiming to build an omnichannel approach with digital services. “Vietnam is a key part of our Asian goal. Our plan to expand the office network to more cities across the country will help bring us closer to customers and serve them better. We are also investing in key initiatives such as new technology to improve the client experience,” said Nguyen. PwC Vietnam and VNCERT form strategic partnership for cyber security incident response In order to promote the development of national cyber security emergency response networks, PwC Vietnam is collaborating with the Vietnam Computer Emergency Response Teams to strengthen training activities and raise the capabilities for timely response to information security incidents in Vietnamese organisations. PwC Vietnam and the Vietnam Computer Emergency Response Teams (VNCERT) have entered into a strategic partnership in cyber security incident response during 2018-2020. Today, the two parties signed a memorandum of understanding (MoU) to officialise this partnership. As cyber-attacks grow more complex and sophisticated, it has become a strategic requirement for all organisations to equip themselves with the necessary talent, processes, and technology to resolve and respond to cyber security incidents. Cyber security incident response can be considered the last line of defence in the IT system, aimed at minimising the damage to the organisation should attacks happen. Incident response is crucial to ensuring information security and requires collaboration and information sharing between many organisations and enterprises. Speaking at the signing ceremony, VNCERT’s director Nguyen Trong Duong said: “Vietnam now has a nationwide network for cyber security emergency response, and as the national co-ordinator, VNCERT expects all organisations to join hands in promoting incident response activities and ensuring network security. Our co-operation with such a prestigious and professional firm as PwC Vietnam will be one of the first steps towards forging a network of incident response that involves all organisations, with an aim to safeguard information security in Vietnam.” Robert Trong Tran, Cyber Security and Privacy leader at PwC Vietnam, emphasised: “Based on the international experience and local knowhow of our expert team, we are committed to helping Vietnamese organisations build up professional, timely, and effective incident response capabilities that follow international practices.” According to the MoU, PwC Vietnam and VNCERT will co-operate in organising training courses and drills on a regional, national, and international scale; standardising incident response practices; as well as developing the market of information security products and services. In addition, both parties will co-ordinate in sharing cyber threat intelligence; developing professional working guidelines for problem rescue teams (CSIRT/CERT); establishing criteria for assessing and verifying the professional competence and ethical qualities of personnel involved in CSIRT/CERT. Dinh Thi Quynh Van, general director of PwC Vietnam, said: “The global PwC network is proud to be one of the pioneering professional services firms to offer information security solutions. We have assisted thousands of corporate and governmental clients across the world to respond to cyber incidents and implement information security strategies over many years.” “With this in mind, we firmly believe that the partnership between PwC Vietnam and VNCERT will produce many practical results and contribute to improving the information security systems of individual organisations and the nation as a whole,” she stated. Nearly US$500 million spent on importing meat Vietnam imported 262,321 live buffaloes and cows and nearly 42,000 tons of beef and buffalo meat at a value of more than US$410 million last year, according to the Department of Animal Husbandry under the Ministry of Agriculture and Rural Development. The country also bought in more than 6,500 tons of pork worth US$11.07 million and 81,000 tons of poultry meat worth over US$75.7 million from overseas. The Department says imported meats are sold at market for cheap prices. As an example, the prices of US and Australian beef vary from VND100,000 to VND500,000 per kg, while Indian buffalo meat is priced at VND90,000-150,000 per kg, and a kg of chicken costs VND35,000-60,000. According to the General Department of Vietnam Customs, the average price for US chicken imported to Vietnam is at roughly VND19,000 per kg and pork at VND27,000/kg. HCM City to host int’l exhibitions on agriculture Agriculture Hub comprising three international exhibitions on livestock breeding, cultivation, and agricultural machinery and equipment, is set to take place at the Saigon Exhibition and Convention Centre (SECC) on March 14-16. Organized by Minh Vi Exhibition & Advertisement Services Co (VEAS) and its partners from the Netherlands, Thailand and China, Agriculture Hub converges the 1st exhibition and conference on Horticultural and Floricultural Production and Processing Technology, the 7th International Livestock, Dairy, Meat Processing and Aquaculture Exposition and the 1st international exhibition on agricultural machinery, equipment and techniques. Agriculture Hub is expected to lure around 420 foreign exhibitors from 35 countries around the world to showcase their products. It will offer a chance for domestic businesses to seek partners for market expansion and update state-of-art technologies from world leading countries. Da Nang & Vietnam Airlines come together The Da Nang People’s Committee and Vietnam Airlines held a signing ceremony for a cooperation agreement to promote tourism in the central city and routes flown by Vietnam Airlines to the destination, contributing to the development of the local tourism and aviation sectors in particular and the country in general. Da Nang will have a policy for stimulating demand for Vietnam Airlines’ flights to and from the city and at the same time will lead in connecting Vietnam Airlines with travel companies. Vietnam Airlines committed to accompanying Da Nang in organizing cultural, sports, and tourism events at the national and international level. The city’s travel and trade promotion delegations will also be given special privileges by the national flag carrier when using its services. The agreement also aims to promote the destination of Da Nang and the image of Vietnam Airlines, including on outdoor billboards, on TV, in the city’s newspapers and publications, and at Vietnam Airlines’ global fairs. The two sides also agreed to coordinate the creation of tourism packages to Da Nang and other cooperation in the field. Mr. Nguyen Ngoc Tuan, Deputy Chairman of the Da Nang People’s Committee, told the signing ceremony that the partnership will be important for both the central city and the national flag carrier. “This will be an opportunity to strongly promote tourism and activities overseas, call for investment, and encourage cultural exchanges between regions and countries,” he said. “I hope that the content of the cooperation agreement will be effectively implemented, bringing practical benefits to both sides towards the development of culture, society, and tourism in Da Nang in particular and the central region in general.” Mr. Trinh Ngoc Thanh, Deputy General Director of Vietnam Airlines, said the cooperation agreement is a great step forward, creating favorable conditions to promote Da Nang’s tourism and trade and enhancing the role, position and image of Vietnam Airlines in cities and provinces in the country, the region, and the world. “In the time to come, with a strategy of expanding its network, Vietnam Airlines will conduct more international flights to and from Da Nang,” he said. “Vietnam Airlines is committed to accompanying Da Nang with the greatest sense of responsibility, contributing to making the city a safe, friendly, and attractive destination.” Binh Thuan pledges to roll out red carpet for investors The south central coastal province of Binh Thuan always creates the optimal conditions for enterprises and investors to do business and develop sustainably in the locality, said a local official. At a dialogue with entrepreneurs on January 11, Chairman of the provincial People’s Committee Nguyen Ngoc Hai said Binh Thuan will take numerous measures to improve its business environment and competitiveness. Administrative reform will be accelerated to shorten the time for procedure processing while authorities will increase dialogues with local firms to address their petitions, Hai added. According to Nguyen Van Khoa, President of the provincial Tourism Association, Binh Thuan welcomed over 5 million tourists in 2017, up 13.6 percent from 2016. The surge shows a positive signal of the tourism sector as well as the province’s sound orientations for tourism development, he said. Khoa also highlighted difficulties facing local tourism firms due to overlapped planning schemes for tourism, seafood and mining projects, as well as limited tourism infrastructure system, particularly in the key tour of Ham Tien – Mui Ne. He suggested the province review its planning schemes to facilitate the implementation of coastal tourism projects, while investing in a national tourism area in terms of environment, infrastructure, and transport. Meanwhile, Do Khac Dong Quan, Vice President of the Binh Thuan Young Entrepreneurs Association, called on the province to continue accelerating administrative reform as well as exempting, reducing and putting off taxes for newly resumed firms. The province should also facilitate access to preferential loans for small- and medium-sized enterprises, particularly micro-sized businesses, he noted. During the event, participants also called on local authorities to deal with trade frauds and overlapped inspections by management agencies, which, they said have troubled enterprises. In 2017, Binh Thuan recorded 716 newly-established firms, up 26 percent from 2016, with a total registered capital of nearly 17 trillion VND (748.0 million USD), raising the total number of businesses in the province to 5,624, with a combined registered capital of nearly 76 trillion VND (3.34 billion USD). Last year, 158 projects were licensed, raising the total number of investment projects to 1,386. Many firms also expanded their operations, contributing to the province’s economic development. Vietnam Airlines uses Airbus A350 on route to Germany The national flag carrier Vietnam Airlines has put into service  Airbus A350 on route between Vietnam and Germany. Vietnamese Ambassador to Germany Doan Xuan Hung, Consul General in Frankfurt Nguyen Hong Linh, Trade Counselor Nguyen Huu Trang, and chief representative of Vietnam Airlines Ngo Tri Hung attended a ceremony at the Frankfurt international airport on January 9 to launch the service. Since January this year, Vietnam Airlines has increased frequency from nine to ten flights per week and used Airbus A350 to replace Boeing 787 – which was put into operation from late 2015. This aims to serve better the travelling of passengers and promote trade, tourism and cultural exchanges between the two countries. Vietnam Airlines is the only airline to operate the direct air route between Vietnam and Germany at present. Airbus A350-900 is considered one of the most modern and convenient planes at this moment, which is expected to help Vietnam Airlines serve passengers better. According to a representative from Vietnam Airlines, about 200,000 German tourists visited Vietnam using Vietnam Airlines services in 2017, a year-on-year rise of 14 percent. In recent years, the number of German visitors to Vietnam has recorded a two-digit growth. Currently, Vietnam Airlines is operating 10 Airbus A350s and 11 Boeing 787s. It expects to have 14 Airbus A350s and 18 Boeing 787s by 2020. Vietnam Airlines has been certified as a 4-star airline for two consecutive years by the international air transport rating organisation Skytrax. Wood industry urged to embrace automation Vietnamese enterprises, regardless of size, should use enterprise resource planning (ERP) solutions to optimise their resources and improve their efficiency, heard a seminar organised by the Handicraft and Wood Industry Association of HCM City on January 9. Phi Anh Tuan, deputy chairman of the HCM City Computer Association and CEO of PAT Consulting, said ERP could be used to collect, store, manage and interpret data from many business activities. The challenge facing wood processing firms is to meet the increasing requirements of buyers in terms of quality, delivery time, and traceability, and cutting costs to improve competitiveness, according to Tuan. The more orders a company gets, the busier its managers are and they do not have time for planning strategy, considering measures to improve productivity and optimise production. With ERP, data is easily available and routinely updated and the management can make the best decisions for the company. They can also get a better overall picture of how the business is operating, which is vital when it comes to responding to changes and improving overall financial planning of the business. Le Duc Nghia, general director of An Cuong Wood Working JSC, said at a time it had 700-800 workers the company had difficulties in managing things. Then its payroll grew to over 1,000 staff and revenue to 1 trillion VND (44 million USD), and the company did not know how to manage, and restructuring became the only option, he said. But then it adopted SAP’s ERP, and management had become smooth, he said. Now it had more than 5,000 workers and revenues of over 3 trillion VND, but management was no longer difficult, he said. “Since applying SAP’s ERP in January last year, our revenues went up by 40 percent, and I just need to work five days a week instead of seven as I used to.” The solution allows him to manage his company’s resources at any time and from anywhere recognise potential risks, and make decisions at every level quickly and precisely. The solution is no longer just for large organisations and in fact ERP for small businesses is quickly becoming popular among organisations to look for greater productivity and more streamlined data that is available to all departments at all times. With proper use, an ERP system can boost productivity, reduce costs, streamline data flow, encourage collaboration, deliver business insights and improve decision-making, according to Tuan. If they streamline their management, Vietnamese businesses can save up to 76 percent of administrative costs. Hoang Dinh Trong, chairman of PDCA Training Consultants Limited Company, said automation would help liberate top management from mundane tasks to focus on their key mission of planning. However, the number of businesses embracing automation remains modest in the wood industry because at most companies the managers used to be skilled workers like carpenters who established a company and so sometimes lack management skills, he said. But many delegates agreed that businesses should definitely adopt appropriate ERP solutions. Da Nang, Vietnam Airlines shake hands in tourism, trade promotion The central city of Da Nang and the national flag carrier Vietnam Airlines signed an agreement on cooperation in tourism, trade and investment promotion on January 9. Under the deal, Da Nang will give support policies to Vietnam Airlines’ flights to the locality, while coordinating with the carrier and travel agencies to promote ticket sales. Meanwhile, Vietnam Airlines will assist Da Nang in hosting national and international cultural, sport and tourism events by giving special preferential policies to passengers flying to Da Nang for tourism and trade promotion activities. Both sides will strengthen advertisement of each other, while working together to build tourism products for Da Nang. Addressing the signing ceremony in the city, Nguyen Ngoc Tuan, Vice Chairman of the Da Nang People’s Committee said that the deal opens new chances for the city to bolster its tourism as well as external relations, helping the city call for investment and strengthen cultural exchanges with localities in other regions and countries. For his part, Vietnam Airlines Deputy General Director Trinh Ngoc Thanh said that the agreement is a giant step in promoting Da Nang’s tourism and trade development. The image and role of Vietnam Airlines in localities nationwide and other countries will also be strengthened, he said. In the coming time, Vietnam Airlines plans to operate new international routes to Da Nang, he revealed. Da Nang, the tourism hub of the central and Central Highlands regions, welcomed 6.6 million visitors in 2017, up nearly 20 percent compared to 2016. Tourists flew to Da Nang in the year was nearly 1.6 million, a surge of 74.4 percent year on year. Da Nang has launched its T2 terminal with a capacity of serving 6 million passengers per year. EIB executive visits Vietnam to seek increased partnership A high-level delegation from the European Investment Bank (EIB) – the world’s largest international public bank – led by its Vice President Jonathan Taylor is on a working visit to Hanoi from January 8-10, the Delegation of the European Union to Vietnam said on January 9. This is the first high-level visit of the EIB to Vietnam in the past five years. Jonathan Taylor, Vice President responsible for operations in Asia, is accompanied by the EIB’s Director for operations outside Europe and senior colleagues responsible for lending in the region. The EIB visit’s agenda includes visits to the site of the lender’s most recent climate related investment in Vietnam, the Hanoi metro project, and meetings with senior government ministers, city leaders and representatives of financial institutions and diplomats. “The EU Bank is committed to strengthening climate related investment worldwide and Vietnam is a key partner for the European Union in Asia. In recent years the European Investment Bank has supported transport, renewable energy and energy efficiency projects across Vietnam. I look forward to seeing at first hand the transformational impact of past EIB investment and discussing with Vietnamese government, city and financial counterparts how the EIB’s future engagement can be strengthened,” said Jonathan Taylor, ahead of the visit. “The European Union and Vietnam cooperate closely to address global challenges and share a commitment to tackle climate change. As the EU Bank, the European Investment Bank has unique technical experience and finance expertise that are already contributing to sustainable development here in Vietnam and across Asia. I am confident that as the world’s largest financier for climate related investment the strengthened EIB engagement in Vietnam will unlock new investment across crucial sectors in the years to come,” said Ambassador Bruno Angelet, Head of the Delegation of the European Union to Vietnam. Past transport financing by the European Investment Bank in Vietnam is supporting construction of new urban rail infrastructure in Hanoi and Ho Chi Minh. In recent years the EIB has also financed small scale climate related investment, including renewable energy projects and cutting energy use in industry, in partnership with Vietnamese banks. The European Investment Bank is owned by 28 EU members. Since 1998, the bank has approved investments worth over 710 million EUR in Vietnam, mostly in projects on transport, climate and renewable energy. Agriculture sector acts to lure more investments The Ministry of Agriculture and Rural Development (MARD) will continue reforming administrative procedures and improving the business environment to lure more investments into the sector this year, particularly hi-tech and organic agriculture. According to Deputy Minister of Agriculture and Rural Development Ha Cong Tuan, the MARD will review 508 administrative procedures and propose simplifying or cutting out 287 out of these administrative procedures, or 56.5 percent. It will also review a total 345 business and investment conditions and propose that 118 of which be amended and cut out, equivalent to 34.2 percent. Eighteen out of 40 specialised inspection procedures will be reviewed, while quarantine and clearance time will be shortened from 24 hours to no more than four hours for goods transported by land or air and no more than 10 hours for those transported by sea. The ministry will continue the second phase of the National Single Window and ASEAN Single Window mechanisms at its five units, aimed at streamlining administrative procedures. In 2017, the MARD actively implemented Resolution 35/NQ-CP on supporting and developing enterprises by 2020, and Resolution 19-2017/NQ-CP on the further implementation of key tasks and measures to improve the business environment and enhance the national competitiveness in 2017, with a vision to 2020, according to Tuan. It focused on connecting enterprises on the basis of sectors, value chains, and scales, and between local and international firms, while providing assistance for social businesses and startups. Level 4 online public services were offered at the ministry’s Department of Plant Protection and Department of Livestock Production, one-stop-shop online administrative procedure services were launched to support enterprises, and interactive services were enabled on the online portal of the ministry and its units’ websites to timely receive and address petitions. The sector saw an increasing number of newly established firms with 1,955 companies in 2017, raising the total number of businesses investing in agriculture to 5,700. Many major groups poured billions of USD into hi-tech and organic agriculture as one of their key orientations and gained significant achievements in the sector. VNN