HCM City plans to develop education zone
The Tay Bac Urban Zone, stretching over 9,000 hectares across HCM City’s Hoc Mon and Cu Chi districts, would be put under a socialised programme, according to the municipal People’s Committee.
Investors in the urban zone’s infrastructure will enjoy land use fee reductions as encouragement.
According to the planning, the zone will be developed into a centre of education through the construction of many universities.
Da Nang gets strict on apartment transfers
Da Nang’s Construction Department said that it would tighten the management of apartment transfers and strictly handle any illegalities.
Department statistics showed that 117 apartment buildings were under construction in the city with a total of 14,962 apartments.
IPO Vinasugar I sells handful of stakes
Only 436,600 shares, just 3.3 per cent of Vinasugar I stakes, were sold at the company’s initial public offering (IPO) on Wednesday.
The successful bidding price on the Ha Noi Stock Exchange was over VND10,100 (US$0.48) a share.
The result is disappointing in the context that the company put more than 13.3 million shares on sales, about 22.24 per cent of its charter capital.
Sugar remains Vinasugar I’s main product and it occupies 19.23 per cent of the market share.
In addition, the company imports and exports confectionery products, spices and beverages, of which Hai Chau is its most famous brand.
Two companies put under alert status
The Ha Noi Stock Exchange announced shares of Vinaconex Xuan Mai Concrete&Construction (XMC) were put under alert status from yesterday due to incurring large losses in 2012.
XMC was VND10.1 billion ($481,000) in the red last year after audit. In addition, its short-term liabilities exceeded its current assets by nearly VND206.6 billion ($9.8 million). The exchange said XMC will be put out of alert status after the company has rectified these shortcomings.
On the same day, the HCM City Stock Exchange also revealed shares of House Viet Nam Co (NVN) will be put under alert status from Monday as the company incurred losses of over VND51.3 billion ($2.4 million) in 2012.
SBV says home loan term reasonable
The State Bank of Viet Nam (SBV) said that it was reasonable to offer a preferential interest rate of 6 per cent for three years to low-income house renters and buyers.
It added that this would not increase the credit limit, which currently totals VND30 trillion (US$1.428 billion).
The support package would only be provided to low-income earners, State staffs and armed forces with hire or hire-purchase contracts of social houses or apartments smaller than 70sq.m and priced below VND15 million ($715) per square metre.
People who bought social houses would not be eligible for the support.
SBV defined low-income earners as people whose average monthly income was not subject to personal income tax.
Only investors of social projects and projects converted to social purposes according to the Ministry of Construction would get the preferential loans.
The construction ministry is currently working on a circular that includes detailed regulations on who can receive the support package.
The central bank said it would not be feasible to divide the fund into two parts with rates of 65 per cent and 35 per cent as mentioned in several proposals, due to the continuous fluctuations of outstanding loans in the banks.
SBV said the VND30 trillion package was reasonable with regards to preserving macro-economic stability and curbing inflation in both the short-term and medium-term.
Apartments in the CT11 building in Kim Van-Kim Lu Urban Area, located near Belt Road 3, were released for sale last week.
Their prices range from VND10 million ($477) to VND14.5 ($690.5) per square metre depending on size. Their areas vary from 45.5 to 77.6 square metres.
Two days later, they were completely sold out, according to an official from the Muong Thanh Real Estate Trading Floor.
The sale’s popularity indicates how many people long to own a house in the big city but are limited by monetary constraints.
Nguyen Chi Kien, deputy director of Him Lam Thu Do Company, said that investors are now responding to this demand by focusing on apartments with prices below VND15 million ($715) per square metre, according to Cong An Nhan Dan (People’s Police) newspaper.
Buyers with a budget below VND1 billion are generally forced to look at apartments farther from the city’s centre.
But there’s such a thing as prices being too low. One woman said in an online forum that the prices were so low that she worried about the quality of the building.
According to Pham Sy Liem, vice chairman of the Viet Nam Federation of Civil Engineering Associations, prospective home buyers should read up on projects and investors carefully and even consult lawyers before making a purchase.
Do Ngoc Mai, who now rents a house in Cau Giay District, said the prices of the apartments were reasonable, but she still hesitated because she did not know much about the project or the investor.
The CT11 project was carried out by Lai Chau Construction Company No1.
According to information on the website of Muong Thanh Real Estate Trading Floor, the building was designed with 40 floors and 18 apartments on each floor. The project commenced on January 11 and is scheduled to be completed by 2016.
Ministry urges cuts to real estate projects
The Ha Noi People’s Committee has decided to set up a group to take charge of supervising structural adjustments to apartment and their purposes.
The department will work with the Housing and Real Estate Management Department and the departments of Finance, Planning and Architecture and Natural Resources and Environment to check and classify these projects.
The city’s People’s Committee has stopped granting licences for commercial housing projects until the end of 2014.
A report by the municipal construction department showed that the city has more than 5,780 empty apartments and hundreds of vacant villas and townhouses. — VNS
About 30-40 per cent of real estate projects should be closed to ensure a balance between supply and demand, according to the Ministry of Construction.
The ministry said that cutting real estate projects would reduce inventories and prevent land from being wasted after unfinished projects had left the land fallow.
Deputy Minister Nguyen Tran Nam said that many developers did not have the resources to complete their projects.
“Even if they did have the finances to implement the projects, the demand simply isn’t there,” he added.
In Ha Noi alone, there are 720 licensed projects covering a total area of more than 300,000 hectares. It’s estimated that these could satisfy demand until 2050.
The figures were alarming given the declining market and difficulties people were facing accessing credit, the ministry said, adding that without proper management, a scenario of a city full of unfinished projects could happen.
Nam said that allowing localities to decide which projects to cancel would cause problems because during the real estate boom, many of them had teamed up with enterprises on development projects, causing a conflict of interests.
Most localities proposed to revoke licences from just a few per cent of projects, rather than the 30-40 per cent that is needed to find a balance.
The ministry plans to set up a group in charge of checking, stopping and revoking real estate licences nationwide.
One expert said that the issue wasn’t pressing because in the medium term, the market would not be flooded as investors were encountering cash flow difficulties.
He recommended simplifying procedures while allowing the construction of affordable housing for low income earners in order to reduce inventories.
Foreign currency loans down in HCM City
Banks in HCM City saw foreign currency loans decrease by 3.68 per cent in the first quarter, according to the State Bank of Viet Nam.
The central bank’s HCM City branch said outstanding dong loans increased by 1.38 per cent in the period, meaning overall credit growth was a mere 0.26 per cent.
Outstanding foreign currency loans have begun dropping since last year after the authorities tightened such lending through the introduction of several new regulations.
Now lenders are allowed to provide foreign currency loans only to exporters who can demonstrate they have the wherewithal to repay in foreign exchange. Consequently, many firms, particularly importers, cannot borrow and have to buy from banks though they are always in need of foreign currency.
Companies meet 70% of demand for fertiliser
The subsidiaries of PetroVietnam Fertiliser & Chemicals Corporation (PVFCCo) have met 70 per cent of demand for fertilisers, helping to ensure national food security, a ministry official has said.
Speaking at a ceremony to receive the Labour Medal, First Grade, awarded to PVFCCo last Wednesday, Deputy Prime Minister Hoang Trung Hai said the country imported 25 per cent of fertiliser and spent billions of US dollars on imported chemicals last year.
Located in Phu My IP in Ba Ria – Vung Tau Province’s Tan Thanh District, the Phu My Fertiliser Plant produces 40 per cent of fertilisers needed for agricultural production in the country.-
World rice price slump hits exporters
The price of rice continued declining during the first quarter of this year, creating problems for rice exporters despite an increase in rice export volume.
Rice prices were down 14 per cent against last year in the first quarter, while rice exports in the first three months grew by 34.3 per cent in volume. The result was a 5.7 per cent drop in export turnover to US$616 million, as prices fell to $450 per tonne.
According to Viet Nam Food Association chairman Truong Thanh Phong, the fall in prices due to abundant supplies.
India, for example, now has 35 million tonnes in stock while it only needs 14-15 million tonnes to ensure domestic food security.
Thailand is also capable of supplying 21 million tonnes to the world market in the next crop while its inventory is 14 million tonnes.
“Many enterprises have made heavy investments in an effort to obtain licences to export rice. But I think they should not invest more because demand is too low,” Phong told Viet Nam News.
Agricultural production is by its nature not stable. Therefore, prices will be adjusted following market movements, said the chairman.
He predicted that farmers’ earnings this year may be lower than 2012 given tough competition from Thailand.
India is now also offering rice at US$30 a tonne higher than that of Viet Nam, so it is difficult for Vietnamese firms to raise their prices, he added.
Last year, the nation had 144 rice exporters, with the 71 largest exporters accounting for 91 per cent of the country’s total rice export turnover, said Phong.
By the end of this month, Viet Nam had signed contracts to export 3.5 million tonnes and has already shipped 1.1 million tonnes, up 20 per cent and 12 per cent respectively on last year.
REE to quit non-core business, focus on power, coal, water
Refrigeration Electric Engineering Co (REE) would divest from its non-core business to focus investment on the electricity, water and coal industries this year, shareholders heard at their annual meeting last week.
The company finished restructuring its securities investment last year.
Its portfolio currently included shares in three companies valued at VND20 billion (US$0.95 million), and REE would divest from these firms this year, according to company chairwoman and CEO Nguyen Thi Mai Thanh.
She said REE would need around VND1 trillion ($47.6 million) to invest in the electricity, water and coal sectors.
Last year, REE invested VND584 billion ($27.8 million) in electricity and coal companies, in which the largest investment accounted for VND429.5 billion in Pha Laii Thermal Power (PPC).
The remaining investments in Vinacomin Nui Beo Coal (NBC) and Vinacomin Deo Nai Coal (TDN) were VND23.6 billion and VND39 billion.
“PPC shares last year had pretty good price of around VND7,000-8,000, while the company’s potential remains enormous,” Thanh said. In addition, the value of the Japanese yen was declining, which was very beneficial for PPC loans.
“The coal industry is also a high profit sector,” she added. Electricity prices tended to go up with coal prices. “Therefore, becoming a shareholder of companies in the sectors will be a huge advantage for REE in the long term.”
Divestment from Sacombank (STB) and Asia Commercial Bank (ACB) in the past year brought more than VND782 billion to the company. The investment in ACB was not profitable, losing VND100 billion with a lot of provisioning used.
REE also said yesterday it would add electricity and water to its business registration certificate.
By the end of last year, the company’s investment in the banking and financial sector decreased by 2 per cent and property by 12 per cent, while the infrastructure and coal sector was up 80 per cent.
REE targets revenue of VND2.4 trillion this year, rising only 0.2 per cent compared to last year, while net profit is expected to slightly decline to VND650 billion.
Last year’s dividend will be paid at 16 per cent, while the minimum ratio for this year’s payment will be 12 per cent.
VietJetAir to open new domestic route
VietJetAir has announced one more route to be added to its domestic network. The route connects HCM City with Buon Me Thuot in the Central Highlands of Viet Nam.
It will open on May 20 with one round trip daily. Ticket prices start from VND390,000 (US$19). The flight will set off from Tan Son Nhat’s domestic terminal in HCM City at 6.30pm and arrive in the country’s “coffee capital” just 55 minutes later.
Talks aimed at encouraging ASEAN trade
The Invest ASEAN-Viet Nam 2013 forum of ASEAN exchanges took place on Saturday in HCM City, aimed at drawing investment capital to the region.
Speaking at the event held for the first time in Viet Nam, HCM Stock Exchange chairman Tran Dac Sinh noted the purpose of the event was to promote cross-border trading in the ASEAN community and attracting investment funds to the region.
“The event is to strengthen the awareness of the capital markets in ASEAN in the world’s financial market as well as to form identical capital markets in this area,” Sinh said.
Various regional initiatives had been worked out and implemented, including the website , broker networking programme and ASEAN Trading Link. Exchanges of Malaysia, Singapore and Thailand kicked off this link last year.
Chang Chiou Yi, regional strategist of CIMB Group (banking), Malaysia considers the ASEAN market has potential as the regional economies demonstrated resilience, powered by domestic demand, unemployment rates lowered.
The regional headline inflation was still manageable. Viet Nam had cut the rate down to 7 per cent in the first two months of 2013, from up to 18.7 per cent in 2011.
But she warned that pressures might build up to 8.3 per cent this year for Viet Nam, or to 4.3 per cent from 3.6 per cent for Singapore.
The ASEAN-Viet Nam Investment forum of ASEAN 2013 exchanges which took place on Saturday in HCM City, aims at drawing capital to the region. — Photo Vietnam+
Phan Thi Tuong Tam, CEO of the city stock exchange said though it was a founding member of the link, Viet Nam had yet to participate in the trading. She expected the event would help relevant authorities and market players have more understanding about the role and benefits of the link, thus would work more actively toward the destination.
She said the fully extended ASEAN Trading Link would make it an asset class, thus more attractive to investors.
It took the three exchanges several years of preparation before joining the link, she said.
Nguyen Son, Head of market development of the State Securities Commission told reporters outside the conference that a specific date for Viet Nam had yet to be fixed and it needed a proper roadmap for Viet Nam to participate in the ASEAN Trading Link to ensure financial securities as the country’s growth level was still slower than several others in the region like Singapore.
“There exist gaps between our criteria on information disclosure, accounting and auditing and the international standards while Singapore has already adopted the international standards,” he said.
The participation also depended on the restructure/merger of the two exchanges in Ha Noi and HCM City, according to Son.
The foreign currency management regulations that tightly governed the capital flow in and out of the country would be an issue to address as well, he said.
He however noted that preparation had been under way, including the selection of bluechip companies to post on the joint website.
Viet Nam selected 15 companies from each of its exchanges, including the Asia Commercial Bank, Vietcombank, Bao Viet, Kinh Do Corp. and Hoang Anh Gia Lai.
The website – www.aseanexchanges.org allows investors to gain access to aggregated ASEAN market data and analytics, market performances of the seven ASEAN exchanges individually, broker research reports and FTSE (Financial Times Stock Exchange)/ASEAN Indices Weekly Report.
The website is built around the ASEAN Stars, the 180 blue-chip stocks (from six countries of Thailand, Singapore, the Philippines, Malaysia, Indonesia and Viet Nam), which represented the 30 most exciting companies of each ASEAN country as ranked by investability in terms of market capitalisation and liquidity.
The seven ASEAN exchanges (Viet Nam has two exchanges) have a combined market capitalisation of over US$1.6 trillion and more than 2,250 companies listed. Some of these companies are the largest and most dynamic companies in the world, including leaders in finance and banking, energy, telecommunications, commodities, automotive manufacturing and other industrial sectors.
Singapore Airlines slashes prices for holiday period
Singapore Airlines will offer discounted fares of 20-60 per cent for travel from April 5 to May 30 from HCM City to Indonesia, the Philippines, Europe, Australia, South Africa and India, on the occasion of the anniversary to commemorate the Hung Kings and April 30 holiday in Viet Nam.
Tickets must be purchased from April 1-14.
VN steel firm to build plant in Thailand
Hoa Sen Group, a leading coated-steel sheet producer, on Saturday signed a memorandum of understanding with Thai companies Asava Metal Ltd Co and BK Metal Sheet Ltd, Part to build a factory in Thailand for producing corrugated iron.
It also signed an agreement with Asava, a leading manufacturer and distributor of metal sheets and steel products in Thailand, to promote its brand in that country.
On the same day the group began operating a 120,000-tonne galvanizing line at its Hoa Sen Phu My Steel Sheet Plant in Ba Ria-Vung Tau Province’s Phu My 1 Industrial Park. It is the company’s fourth production line using N.O.F (non-oxidising furnace) technology, the most advanced in the coating steel sheet industry.
HCM City to replicate price control initiative
HCM City’s annual price stabilisation programme will this year focus on the same four groups of goods as last year – essential foods and foodstuff, materials used by students, drugs, and dairy products – the Department of Industry and Trade has said.
Speaking at a meeting on Saturday to review last year’s programme and make plans for this year, Le Ngoc Dao, the department’s deputy director, said 64 companies had registered to take part, a third more than last year.
Five credit institutions – Agribank, Eximbank, Sacombank, BIDV, and Vietinbank – had joined for the first time, she said.
The programme, to last from April 1 to March 31 next year, would see the participating businesses sell at 5-10 per cent lower than market prices, she said.
They could hike prices if their costs increase by 5-10 per cent, but would have to get express approval from the Department of Finance, she said.
“Unlike in previous years, when the businesses got interest-free loans from the city, this year they will get loans at reasonable interest rates from the credit institutions taking part in the programme.”
The five lenders have earmarked VND860 billion for short-term loans at 6 per cent and VND1.1 trillion for long-term loans at 10 per cent, she added.
The city will subsidise investment by the participating firms in technology upgrading and expansion of breeding farms, linking them with distribution networks, and providing free advertising.
Nguyen Thi Hong, deputy chairwoman of the city People’s Committee, called on relevant agencies and enterprises to ensure the cheap goods under the programme reach company canteens, markets, supermarkets, and other retail centres.
Deputy Minister of Industry and Trade Tran Tuan Anh said: “The city will set up more outlets in outlying districts and industrial parks to provide sufficient goods to low-income people at reasonable prices.”
Hong said the price stabilisation programme has benefited both consumers and enterprises in the last 11 years.
Last year the volume of goods sold under the programme accounted for 25-40 per cent of total demand in the city, an increase of 15-30 percentage points over 2011, she added.
HCM City to host int’l conference on aviation logistics
International logistics scholars and representatives from aviation agencies and logistics companies will meet in HCM City on April 25-26.
The international conference is co-organised by the Vietnam Civil Aviation Administration, the International Air Transport Association (IATA) and the International Federation of Freight Forwarders Associations (FIATA) to discuss Vietnam’s aviation logistics in 2013.
Participants will work out proper solutions to link businesses in the logistics sector for the benefit of future development.
They will consider new opportunities and challenges for the sector as far as its security regulations are concerned.
According to the Vietnam Civil Aviation Administration, last year, the sector last year carried 17.5 million of passengers (up 5.2 percent) and transported 201,000 tonnes of cargo (up 1.98 percent) compared to the previous year.
This year, the sector plans to carry 19.2 million of passengers, (up 9.8 percent) and transport 214,000 tonnes of cargo, (up 9.9 percent).
Vietnam’s agricultural and seafood exports to Japanese market
Due to different crop and weather patterns, Vietnam has plenty of opportunity to export agricultural and seafood products to the Japanese market. But there remain snags in meeting Japan’s strict food safety and hygiene requirements.
According to the Vietnamese Embassy in Tokyo, Vietnam-Japan economic relations showed impressive growth in 2012. Trade exchange between the two countries rose fast to US$25 billion from US$21 billion in 2011, with exports to Japan reaching US$13 billion (up 21 percent), Vietnam had a continuous run for trade surpluses with Japan to US$1 billion last year.
Vietnam’s exports to Japan are likely to increase by 20 percent to more than US$15 billion in 2013.
In recent years, a host of successfully negotiated important economic agreements has created favorable conditions for Vietnam to increase its agricultural exports to Japan. A sharp reduction in tax rates for all farm produce has opened opportunities for Vietnamese businesses to gain ground.
Under the Vietnam-Japan Economic Partnership Agreement (VJEPA), Japan is committed to reducing its levies by nearly 84 percent of Vietnam’s agricultural export value. When the VJEPA went into effect, Japan immediately rescinded 784 out of 2,020 agricultural tax lines—36 percent of the total agricultural tax previously levied and 67.6 percent of Vietnam’s export value.
The VJEPA roadmap until 2020 specifies that more than 800 kinds of Vietnamese agricultural and seafood products exported to Japan will be granted tax exemptions. Fourteen products like glutamate, soya beans, ginger, rambutan, and banana are eligible to enjoy tax reductions within 3-5 years.
Japan will continue reducing and removing import tariffs levied on 72 agricultural tax lines for seven years while a roadmap to reduce and abolish tariffs will be applied to 210 tax lines for ten years.
Vietnamese export businesses are taking advantage of opportunities to export processed vegetables and fruits, corn, and spices to Japan. Sixty-four out of 330 seafood items are subject to tax reductions, accounting for 71 percent of Vietnam’s seafood exports to Japan. As of January 2013, Japanese import tariffs have been lowered to zero percent.
At a recent seminar on food safety and agro-forestry and seafood exports, Deputy Minister of Agriculture and Rural Development Nguyen Dang Khoa said that since the signing of VJEPA in 2008, up to 86 percent of Vietnamese goods exported to Japan have enjoyed preferential tariffs. The VJEPA is considered a real boon for Vietnamese seafood exporting and processing enterprises which are set to improve the quality of products in line with strict food safety and hygiene requirements.
Khoa said Vietnam’s agro-forestry and seafood products are exported to more than 160 nations. Vietnam is one of the world’s leading exporters of rice, coffee, cashew nuts, and shrimp, which earned US$27.5 billion last year including US$2 billion from the Japanese market alone although the figure was still fall short of both countries’ expectations.
Sharing this view, Vietnamese Ambassador to Japan Doan Xuan Hung remarked that many of Vietnam’s high-quality agricultural and seafood products are not available in the Japanese market. Hung said Japan is Vietnam’s biggest ODA provider, leading investor and important trade partner. However, in fact, Vietnam’s exports to Japan are worth just 1.7 percent of Japan’s total import volume. The two governments are encouraging businesses from both countries to increase trade exchange and cooperation in the food safety and hygiene area.
The ASEAN-Japan Centre’s Secretary-General Yoshikuni Onishi said that with an average income of US$1,500 per capita, Vietnam has become an attractive destination for Japanese enterprises. To mark the 40th anniversary of diplomatic ties between Japan and Vietnam, the Centre has introduced a series of initiatives aimed at promoting bilateral economic, trade, investment, and tourism cooperation.
Wood exports to reach US$5.5 bln in 2013
With earnings topping US$1.2 billion in the first quarter, exporters of wood and wood products are hoping to rake in US$5.5 billion this year, according to the Ministry of Agriculture and Rural Development (MARD).
With 3.5 million hectares of forest, the country harvests approximately six million cu.m. of wood each year, 80 percent of which is exported in the form of wood chips, while only 20 percent is processed into other kinds of products.
The US, China and Japan are the major markets for Vietnamese wood and wood products.
Last year, Vietnam became the largest wood exporter in Southeast Asian with total export turnover at US$4.67 billion, a year on year increase of 18 percent.
However, Vietnamese wood product exporters are still facing various difficulties such as unhealthy competition in material purchase and product sale, and the lack of distribution networks in foreign markets.
Germany shares economic model with Vietnam
The Germany’s model of social market economy was highlighted at a presentation in Hanoi on April 2 on the occasion of German State Secretary of Labour and Social Affairs Ralf Brauksiepe’s visit to Vietnam.
At the event which was organised by the Vietnam Academy of Social Sciences and the Konrad Adenauer Foundation (Germany), scientists shared their experiences in research and policy consultation in economic management and national development.
Ralf Brauksiepe said Germany has gained many successes thanks to the social market economy it has been pursuing for the past 60 years.
According to the secretary, the model of social market economy is a combination of economic efficiency and social equity. Its target is to maintain the balance among economic factor, freedom and social equity.
Norway seeks closer trade ties with Vietnam
-Norway always supports Vietnam’s negotiations on the signing of a free trade agreement (FTA) with the EFTA bloc, said Norwegian Minister of Trade and Industry Trond Giske.
During his meeting with Vietnamese counterpart Vu Huy Hoang in Hanoi on April 1, Minister Trond Giske said that the bilateral FTA will create new cooperation opportunities for both countries thanks to tariff reduction and removal of trade barriers.
Minister Hoang thanked the Norwegian Government for its constant assistance to Vietnam’s development process, both in the past and at present. He said Vietnam always treasures its cooperation with Norway – one of its key trade and economic partners in Europe.
According to the General Department of Vietnam Customs’ statistics, the two-way trade turnover between Vietnam and Norway in 2012 reached US$257 million, up 0.5 percent compared to the previous year. Vietnam’s export earnings from the Norwegian market in 2012 were estimated at US$125 million, a year-on-year increase of 40 percent.
However, the two ministers agreed that such results were far from meeting bilateral expectations.
The European Free Trade Association (EFTA), being comprised of Norway, Switzerland, Iceland and Liechtenstein, has recognized Vietnam’s market economy status and is in the process of FTA negotiations.
The fourth round of negotiations between Vietnam and EFTA will be held in Oslo, Norway, in June, in the hope of creating a legal framework for both sides to increase business cooperation and investment.
HCM City Tourism Festival gets underway
The annual HCM City Tourism Festival seeking to promote the local tourism industry by introducing new products and services will start tomorrow and run until Sunday at the September 23 Park in District 1.
The “HCM City Tourism: Trademark – Integration – Development” will be hosted by the city Department of Culture, Sports and Tourism along with other agencies.
La Quoc Khanh, deputy director of the department, said the main goal of the festival is to stimulate domestic tourism by acting as a bridge between travel companies and customers.
The highlights of this year’s event will be a tourism fair and a fete to honour prestigious tourism names.
Some 120 booths will be set up by 80 travel companies, while Vietnamese and international cuisines will be showcased at 10 other booths. The first HCM City Young Tourism Ambassadors competition will be another major attraction.
Bank forecasts strong year for exports
Stronger exports this year can help lift Viet Nam out of its malaise, HSBC Vietnam says in its “At a Glance” report that was released yesterday.
The report says both the improved new orders sub-index of the Purchasing Manufacturers’ Index and the acceleration of imports show that exports should have a strong year, especially in electronics and manufacturing.
Year to date, the country has a trade surplus, thanks to continued foreign investment inflow into Viet Nam.
In Q1 2013, registered FDI increased almost 30 per cent year-on-year to US$2.9 billion, and pledged FDI rose to $6 billion, a 63 per cent increase.
Manufacturing attracted $5.4 billion, 90 per cent of total FDI. This means that while domestic demand is sluggish, the export sector (63 per cent of which was driven by foreign firms in 2012) will continue to expand and provide much-needed jobs and income.
Should the Government continue to stabilise the macro economy, invest in infrastructure projects that improve productivity and reduce red tape for efficient firms to flourish, Viet Nam could emerge in several years as a leaner economic machine after the country has made the necessary reforms, the report says.
Apart from the jump in new export orders, March also saw employment sub-indices rise to above 50 (the neutral level).
Demand from the region is rebounding, particularly in China, Japan and Thailand.
The report says that since May 2012, the new export order sub-index has been contracting; as such, its improvement, should it be sustained, will continue to bolster the manufacturing sector.
The new order (both domestic and export) index has also risen sharply, with evidence that both local economic activity and foreign demand are increasing. The rate of expansion of the output sub-index is the fastest in a year and a half, the report says.
The expansion of the employment sub-index in five out of the past six months highlights manufacturers’ positive outlook despite challenging domestic conditions.
The report says planned expansion and higher sales volumes were responsible for higher headcounts in March.
Retail sales are normalising, although they are still low compared with the historical average. On a trend basis (% three-month/three-month seasonally adjusted annualised), retail sales are rising slowly, indicative of a stabilisation in domestic activity “where consumption has recalibrated to new expectations,” the report says .
The consumption slowdown is not necessarily a negative event in the medium term, it notes, suggests that both the private and public sectors are more conservative, avoiding investing in activities that would not generate productivity in the long run. A return to fundamental investments after years of fruitless ventures is a step in the right direction.
By a natural selection process, in which inefficient firms wither away slowly and effective ones flourish, Viet Nam could find its way out of its debt problem.
The report also notes that exports may increase as a share of GDP to almost 90 per cent by next year’s end. The continued rise in exports, with imports primarily used for production, will allow Viet Nam to have a current account surplus in the next two years, supported by remittance inflows.
High-frequency data show that exports may have another strong year, the HSBC report says. Year to date (January- March), the country has enjoyed a trade surplus of $382 million, with exports expanding 19.7 per cent y-t-d and imports rising 17 per cent.
“Given that the Government is committed to keeping the economy stable, with domestic demand still weak and commodity prices contained, we expect inflation to be contained in 2013.
Unless there is a commodity price spike or further increases in public service costs, such as healthcare similar to Q3 2012’s, we think inflation should slow in Q3 2013, which would allow the State Bank of Viet Nam to lower the OMO rate by another 50bp at end-Q2 2013,” says the report.
Tien Giang cuts back ineffective projects
The Mekong Delta Province of Tien Giang plans to withdraw investment certificates from ineffective industrial park (IP) projects this year.
Binh Dong IP has already had its investment certificate revoked because implementation was delayed, according to Nguyen Xuan Truong, deputy director of the provincial IPs’ Management Board .
The local people’s committee is considering stopping another IP project in Tan Phuoc District.
Tien Giang Province now has three completed IPs.
Clams die en masse in southern Tra Vinh
Clams died en masse in the southern province of Tra Vinh last month, causing serious financial losses for local shellfish breeders.
The worst-hit field – in Duyen Hai District’s Dong Hai Commune – suffered losses totaling around 90 per cent.
Hot weather, high amounts of salt and changes in water were blamed for the deaths, said Dao Van Chinh, vice chairman of the Dong Hai communal people’s committee.
The province has proposed the State offer assistance to affected breeders and investigate the reason for the death.
Seafood exports down 8% in Q1
Seafood export turnover in the first quarter of this year is estimated at US$1.2 billion, a drop of 7.5-8 per cent year-on-year.
According to the Viet Nam Association of Seafood Exporters and Producers (VASEP), seafood exports in March reached about $450 million, down 17-18 per cent against the same month in 2012.
Domestic shrimp producers are facing difficulties due to decreasing demand and Japan’s strict ethoxiquyn limits.
VASEP estimated that shrimp exports fell by 10 per cent to $160 million in March and 8 per cent to $400 million in the first three months of the year.
The export of tra fish saw a year-on-year decrease of 13 per cent to $140 million, driving down total tra fish export earnings in the first quarter to $393 million, a fall of 7.6 per cent from a year ago.
Tuna exports rose to $145 million in March, up 12 per cent compared to last year’s figure. However the first quarter’s value down 16 per cent year-on-year.-
Electricity prices unlikely to rise
The price of power will not rise this month, said director of the Ministry of Industry and Trade’s Electricity Regulatory Department Dang Huy Cuong.
Cuong also confirmed at the ministry’s meeting on Monday that there would be sufficient power for consumption and production for the next three months, despite a drought in many localities.
The electricity production was 10.2 trillion kWh last month, and 27.8 trillion kWh in the first three months of this year, an increase of 8.1 per cent compared with the same quarter last year.
The power produced by Electricity of Viet Nam (EVN) in the first three months reached 10.6 trillion kWh, making up 38.3 per cent of the electricity sector’s total output, up 2.2 per cent in comparison with the first quarter last year.
The output basically met demand, the ministry said.
However, the electricity sector will still face difficulties in producing power due to unstable weather conditions.
Reservoirs do not have enough water after discharging for irrigation. As a result, the electricity output will lack at least 1.4 billion kWh, said EVN.
The dry weather in central and Central Highlands provinces means that 1.5 billion kWh may have to be produced by oil and diesel oil this year.
The Viet Nam National Coal-Mineral Industries Group and PetroVietnam will ensure coal and gas are available to operate thermoelectric plants when hydro plants lack water.
The ministry also required electricity companies to join hand with local departments of industry and trade to save on electricity.
If such measures were implemented, high-price electricity made by oil would be reduced, along with the likelihood of a power price rise, said Cuong.
Rubber demand likely to rise
Demand for natural rubber is expected to increase, Tran Thi Thuy Hoa, General-Secretary of the Viet Nam Rubber Association (VRA), said.
She was speaking at a recent conference on sustainable rubber development in southern Binh Phuoc Province.
The conference drew the participation of more than 550 delegates from relevant ministries, departments, institutions, groups and associations.
According to Hoa, the rubber growing areas have developed quickly thanks to high rubber prices in foreign markets.
To meet the rising demand, the industry needs to further expand growing areas and ensure the quality of products, she said.
According to the VRA, Viet Nam is now the third-largest exporter of natural rubber in the world behind Thailand and Indonesia, with its output bouncing up to 1.01 million tonnes last year – an increase of 23.8 per cent from 2011.-
Chamber honours businesses
The Corporate Social Responsibility Awards honoured 41 enterprises for their contributions to society.
The Viet Nam Chamber of Commerce and Industry (VCCI) held an awards ceremony in Ha Noi on March 30.
According to Nguyen Quang Vinh, Director of the VCCI’s Business Office for Sustainable Development, the awards were presented to firms that improved working conditions and protected workers and the environment using advanced energy-saving and environmentally-friendly technologies.
VCCI Chairman Vu Tien Loc stressed that the organisation will continue to support businesses in carrying out their social duties through various activities, including information dissemination and human resources training.
Binh Duong attracts $600m in FDI
Southern Binh Duong Province attracted some US$579 million in foreign investment in the first quarter of this year, according to the provincial Department of Planning and Investment.
The Viet Nam-Singapore Industrial Park alone received 11 FDI projects with total capital of $368 million. Three newly licensed projects have combined capital of $258 million and eight operational projects raised over $110 million in capital.
Binh Duong plans to attract over $1 billion in foreign investment this year, mainly in industries with high added value such as electricity, electronics and pharmaceuticals.
The province has recently received many delegations of foreign investors, including many from the Republic of Korea and Japan, who came to seek out opportunities in the fields of construction, entertainment, culture and education.
Binh Duong drew nearly $3 billion in foreign investment in 2012, up 253 per cent against 2011. This accounted for 17.1 per cent of Viet Nam’s total FDI last year.
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