ADB-funded project brings power to Lai Chau province
Households in 31 mountainous communes in northern Lai Chau province on June 19 gained access to electricity as a project to expand and improve the province’s rural power grids started generation.
The generation is part of an Asian Development Bank (ADB)-funded programme to develop renewable energy, expand and improve power grids in remote rural areas.
The two-phase programme has a total investment of over 948 billion VND (45 million USD), including 30 million USD funded by ADB.
Its first phase is expected to complete later this month, with 5,758 households in Lai Chau province and 7,944 others in Dien Bien province gaining access to electricity.
Once becoming fully operational by the end of 2014, the programme will provide electricity to 14,487 households in 48 communes in eight districts of Dien Bien province and 16,207 households in 53 communes in Lai Chau province’s six district, including Than Uyen, Tan Uyen, Phong Tho, Tam Duong, Sin Ho and Muong Te.
It will help raise the number of families having electricity in Lai Chau province from 61 percent to 79 percent and in Dien Bien from 67.9 percent to 81 percent.
Binh Duong export value up 16% in five months
Local export enterprises in the southern province of Binh Duong had signed contracts to export products until the end of the year, said an official from the Binh Duong Province's Association of Exporters and Importers.
Export value from the province in the first five months of this year increased 16 per cent to nearly US$5 billion against the same period last year, according to the People's Committee of Binh Duong.
Domestic invested enterprises achieved a year-on-year increase of 5.2 per cent in export value to $820 million, while foreign invested firms' enjoyed a year-on-year rise of 18.6 per cent to $4 billion.
Key exports including wood products, textiles and garments, leather, footwear and handicrafts had contributed to the surge, despite the economic downturn, according to the Binh Duong Importers and Exporters Club.
Pham Van Xo, head of the club, said the club's 156 members had all signed export contracts until the end of the year, and the apparel, leather and footwear industries had received large orders for cheap, quality goods.
Enterprises must cut production costs, apply modern technology and use a trained workforce to increase profits, Xo said.
This year, local leather and footwear enterprises were producing good designs and applying modern technology in production and management to reduce risks, he said.
Le Hong Phoa, chairman of the Binh Duong Apparel Association, said that local apparel exports increased 7.3 per cent in value in the first five months to $600 million compared to the same period last year, and Binh Duong was considered one of the leading apparel provinces in Viet Nam, he said.
However, the sector still faced many challenges, he said. Those included lack of capital, dependence on material imports and lack of workers.
Additionally, the economic downturn and technical barriers on export markets were also challenges for local exporters, Xo said.
Larger foreign firms were also dominating the market due to larger production scale and financial capacity that left local companies struggling to keep up with global demand.
Local enterprises should invest in infrastructure and technology to increase exports, he said.
Binh Duong exports are projected to increase 20 per cent in value this year to $15-16 billion, and key exports including wood products, textiles and garments, leather, footwear, latex and handicrafts are expected to achieve good results.
Strong growth forecast for high-tech export sector
High-tech products, a key export item for HCM City, are expected to see strong growth in the near future, according to speakers at a seminar held yesterday in HCM City.
The seminar was organised by the Department of Industry and Trade, Sai Gon Hi-tech Park and WTO Centre's Development and Research Institute.
Huynh Khanh Hiep, deputy director of the city's Department of Industry and Trade, said that export turnover of high-tech products reached US$2.46 billion, an increase of three times compared to 2011. This accounted for 11.4 per cent of HCM City's total export turnover (not including crude oil).
The main export markets for hi-tech products are in Asia (Japan, Singapore, mainland China, Philippines and Thailand).
Among hi-tech products, the city's software exports are expected to reach an average growth rate of 40 per cent each year. By 2015, this is estimated to account for 2 per cent of the total export turnover.
However, Hiep said to reach the target, support policies from the government were needed.
He noted that Japan, which imports a great deal of software, especially from China, has shifted its attention to the ASEAN region, including Viet Nam. Domestic demand has also increased as more government agencies and businesses have invested in IT.
"Local companies need to restructure businesses, seek high-quality human resources and cooperation opportunities to strengthen exports of high-tech products," Hiep said.
Le Thi Bich Loan, deputy head of the management board of Sai Gon Hi-Tech Park (SHTP), said that in the first five months of the year SHTP's hi-tech product exports reached $695 million out of $1 billion in total export turnover.
However, most of this came from foreign-invested enterprises.
The localisation ratio of high-tech products was still low, at 18 per cent. It is expected to increase to 35-45 per cent by 2020, she said.
"Currently, domestic enterprises are facing many difficulties including capital shortage. They are still weak in R&D and design. These are key to increase added value added for products," she said.
SHTP, in collaboration with city authorities, has offered incentives on taxes, land rentals and loans, as well as training support for high-tech support industry projects inside the SHTP.
Chu Tien Dung, chairman of the HCM City Computer Association, said the State should issue support policies on infrastructure for production, including land, technology and communications, to save costs and increase competitiveness with other countries.
Human resources are also an important factor to help software companies develop in an international market. Employees are plentiful, but the quality of staff is not high, failing to meet demand, according to Dung. The lack of skilled workers has hindered export growth of companies, he said.
Dung said there was also a need to build national trademarks for high-tech products and hold more trade promotions to introduce products to the global market.
Local products get thumbs up
Vietnamese goods such as Vinamilk dairy products, 333 Beer and Hao Hao instant noodles have been highlighted for their brisk sales in the domestic market.
The latest report from consumer information group Kantar highlighted several Vietnamese products in their rankings of top brands in the health & beauty, home care and beverages and food sectors across the county.
Local products such as Vinamilk, Masan's Chinsu fish sauce, Tuong An cooking oil, Sabeco's 333 Beer and My Hao dish washing and fabric detergent were ranked high.
According to the report, the five most chosen food brands were Vinamilk, Chinsu (Masan), Hao Hao instant noodles (Vina Acecook), Dutch Lady (Friesland Campina) and Tuong An cooking oil.
Vinamilk reaches nearly every Vietnamese household (94 per cent of the population), with 57 million individual sales each year.
The top five brands in health and beauty are P/S of Unilever, Kotex of Kimberly Clark, Clear of Unilever, Lifebuoy of Unilever and Colgate of Colgate-Palmolive. All are from multinational firms.
The beverage sector saw Nestle's Nescafe on top, followed by Sting energy drink from Pepsico, Sabeco's 333 Beer, Coca-Cola and URC Viet Nam's C2 ready-to-drink tea.
The Kantar World-panel Brand Footprint Ranking measures the popularity of brands in 32 countries in four continents.
Long An GDP growth reaches 9.7%
Mekong Delta Long An Province posted a 9.7 per cent increase in Gross Domestic Product (GDP) in the first half of 2013.
However, this year's H1 posted the lowest GDP growth in four years, the provincial Statistics Office has revealed.
In the first six months of 2013, the construction industry soared 13.9 per cent; the trade and services sector increased 11.5 per cent; and agriculture, forestry and fisheries grew 2.9 per cent.
The province also posted total retail sales and services of VND16,681 billion (US$793 million) in H1/2013, up 18.6 per cent year on year.
Long An earned a total of $1.3 billion from exports, up 16.4 per cent year on year, while it spent $1.036 billion to import goods and services, up 7.8 per cent.
Sai Gon Co.op opens supermarket
Sai Gon Co.op opened its 62nd supermarket in central Nha Trang City with investment capital of more than VND120 billion ($5.7 million).
The store covers an area of more than 10,000sq.m and stocks more than 30,000 products including food, cosmetics, garments and household appliances and utensils.
It is the second Co.op supermarket in central Khanh Hoa Province to provide price-stabilised goods for local residents and neighbouring provinces.
On the opening occasion, Co.op mart Nha Trang offered discounts of 50 per cent on thousands of items till June 30.-
Viet Nam to host German businesses
The 14th Asia-Pacific Conference of German Business will be held in HCM City in November 2014, the German Industry and Commerce Viet Nam has announced.
Viet Nam's position as one of Germany's most important partners in Southeast Asa has presented it with the chance to host the conference for the first time.
At the meeting, German enterprises will make exchanges and promote trade with regional firms, economic experts and politicians.
The event will also offer opportunities for Vietnamese businesses to work with German peers to figure out ways to increase the two countries' bilateral trade and seek investment partnerships.
Tra fish exports forecast at $800m
Exports of tra fish are expected to reach around US$800 million in the first half of this year, down 7.3 per cent year-on-year, according to the Viet Nam Association of Seafood Exporters and Producers (VASEP).
Tra fish exports experienced a yearly decrease of 6.7 per cent in the past five months, reaching around $670 million in that time, VASEP said, blaming the unsatisfactory results for declining export value in some markets including the EU, one of Viet Nam's biggest customers.
Over the period, the country exported only $151 million worth of tra fish to the EU, plunging 17.6 per cent against the same time last year.
Truong Dinh Hoe, general secretary of VASEP, predicted that tra fish demand from the EU markets were not likely to recover as expected and Viet Nam's tra fish exports to the EU may not grow in the near future as the bloc's debt crisis had not been overcome, while consumer power was yet to change positively.
On a brighter note, Hoe said exports of tra fish to the US, another important market, could recover in the latter months of this year.
Tra fish exports to the US continued to increase, earning $150.8 million in the first five months, up 3.8 per cent against the same period last year.
Earlier, VASEP forecast that tra fish exports would bring in $1.9 billion by the year-end, surging 5.5 per cent year-on-year.
Tra fish business should meet stricter hygiene and registration conditions to guarantee quality and improve management of the sector, experts have said.
There should also be more co-ordination among tra fish farmers, processors and exporters, they said.
Firms get right to defer tax payments
Enterprises would be allowed to pay their tax debts by installments from the beginning of next month, under a new proviso intended to assist firms in weathering the economic storm.
The concession is set to be added to the amended law of tax management, due to come into force on July 1.
Under the caveat, deferred tax debts must be paid off within 12 months. Enterprises would then have to pay late payment fines at 0.05 per cent of the debt per day.
Enterprises must obtain a guarantee from credit institutions to qualify for the deferred payment. Under the guarantee, credit institutions must confer with tax agencies about the ability of firms to pay the taxes and fines for late payment in case enterprises do not fulfil their obligations.
If enterprises failed to pay tax debts according to the registered schedule, after five days of the deadline passing, guarantee institutions would be responsible for paying enterprises' tax debts and fines for late payment.
However, at a conference held last week by the General Department of Taxation, enterprises said the rate of 0.05 per cent per day for late payment, equivalent to 18 per cent per year, was high in comparison with the current loan interest rate of 12-13 per cent per year.
Enterprises also said that it would be difficult for them to gain such guarantees from credit institutions for deferred payment.
Seafood company delists due to low share value
Seafood processor Gentraco (GFC) will ask its shareholders to delist shares and terminate the status of a public company during its annual meeting tomorrow.
The company said that due to the overall impact of the economy along with its own difficulties, its share price in the stock market constantly declined to the current VND3,000 (US$0.14) per share.
Therefore, Gentraco could not raise capital through the stock market as well as enhance the interests of shareholders because of the low market value.
In addition, the Ha Noi Stock Exchange can delist the stock due to its low liquidity and being put under special warnings and control. Hence, the company will volunteer to cancel listing.
Gentraco expects revenue and profit this year will reach only VND779 billion ($37 million) and VND254 million ($12,000).
Seafood firms sell assets to stay in business
Viet Nhat Seafood (VNH) yesterday announced it had to sell some of its assets to raise capital for its operation.
Specifically, it will sell VND12 billion (US$571,400) in Phu Nhat Canned Food Co Ltd, which has a charter capital of VND36 billion ($1.7 million).
In addition, it had sold a VND54 billion ($2.5 million) property in HCM City to Sai Gon Trading Group earlier this year.
The company expects modest revenue and profits of just VND80 billion ($3.8 million) and VND4 billion ($190,000) for this year.
VNH shares lost 3.8 per cent yesterday to just VND2,500 ($0.10).
FPT earnings up in first five months
Software provider FPT announced its revenue during the first five months of this year reached nearly VND9.8 trillion (US$466.6 million), exceeding the period's target by 6 per cent and completing 36 per cent of the year's plan.
Gross profit was VND968 billion ($46 million), or 37 per cent of the year's plan, while net profit reached VND796 billion ($37.9 million), accounting for 36 per cent of this year's target.
Earning per share (EPS) after the first five months was VND2,162 ($0.10), equivalent to 35 per cent of the year's plan. FPT closed yesterday's session off 0.5 per cent to VND42,800 ($2).
Draft circular regulates asset management
The State Bank of Viet Nam this week unveiled a draft circular regulating the operation of the Viet Nam Asset Management Company (VAMC) which is to become operational on July 9.
According to the draft, lenders with non-performing loans (NPL) ratios of 3 per cent and above will be required to sell the loans to VAMC in either of two ways: at book value by issuing special bonds or at market value by using other sources.
VAMC will use the special bonds to buy only NPLs that are backed by collateral, 65 per cent of which must be real estate. The bad loans and collateral must be legitimate, not used to back other obligations of credit institutions and have full records and legal papers.
To have NPLs bought by the VAMC bonds, the balances or outstanding bad debts cannot be lower than VND3 billion for borrowing firms and VND1 billion for individual borrowers.
The Prime Minister will decide if VAMC buys bad loans that do not meet the conditions as recommended by the central bank.
To have bad loans purchased by VAMC at market value, which must be based on recoverability of the loans and collateral. The purchase price shall not be higher than the market value or the re-assessed value of the debts.
Borrowers must also have prospects of making repayments for the loans besides feasible production figures, business and repayment plans.
The draft circular also stipulates that credit institutions shall make specific provision for special bonds issued by VAMC.
Under the draft, VAMC can earn 2 per cent of total debts recovered and the income will be used to offset associated costs.
VAMC is expected to help the country to resolve roughly VND80-100 trillion of bad loans with a projected loan recovery rate of 20-40 per cent.
Vietnam Co-operative Bank to open
The Vietnam Co-operative Bank (Co-opBank), formerly the Central People’s Credit Fund (CPCF), will officially begin operating on June 24 with chartered capital of VND3 trillion (US$142 million) and an operational duration of 99 years.
The bank’s chartered capital is sourced from the State budget, CPCF members and other legal entities.
The two state capital representatives at the Co-opBank are the bank’s Board of Directors (BOD) chairman Tran Quang Khanh and its Director General, Do Manh Hung.
The bank will be headquartered in Nguyen Thi Dinh street, Cau Giay district, Hanoi and it will comprise a network of domestic and foreign branches.
Transformed from the CPCF, the bank will take responsibility for handling all the CPCF’s problems, in addition to implementing valid contracts and transactions signed by the CPCF.
VietinBank to loan $1.2b to Hoa Sen
The Viet Nam Joint Stock Commercial Bank for Industry and Trade (ViettinBank) will lend VND2.5 trillion (US$1.2 billion) to the steelmaker Hoa Sen Group for the construction of two mills containing cold rolling lines.
The loans will be disbursed in late 2013 and early 2014 under an agreement on strategic co-operation which was signed yesterday, said ViettinBank chairman Pham Huy Hung.
Each cold rolling line will have a designed capacity of 200,000 tonnes of metal per year.
VietinBank has also committed to providing funds for Hoa Sen Group to supplement the company's working capital. They will enjoy preferential lending rates of 8 per cent for short-term loans and 11 per cent for long-term credits, Hung noted.
Prime Minister Nguyen Tan Dung has approved a technical assistance project to develop a power grid in Hanoi and Ho Chi Minh City that will be funded from Asian Development Bank’s non-refundable official development assistance.
The project will cost an estimated US$544,000, of which $500,000 will be contributed by ADB.
The Prime Minister entrusted the Ministry of Industry and Trade to prepare, verify and ratify the aforesaid project abiding by current regulations. The State Bank of Vietnam will coordinate and sign the agreement with ADB.
Increasing fertilizer exports to Myanmar
Fertilizer exports to Myanmar will enjoy a sharp increase in the near future thanks to improved international payment services.
Dam Phu My Joint Stock Company General Director Cao Hoai Duong said Myanmar needs to import around 1.5 million tonnes of fertilizers annually in order to service its large cultivatable area.
The demand for imported fertilizers will continue rising as the Myanmar government has set ambitious targets for higher agricultural output.
Vietnamese fertilizer exporters had previously encountered payment difficulties, requiring the involvement of a third nation like Singapore or Hong Kong.
Duong said the services have now improved, allowing Vietnamese exporters to conduct international transactions with their trade partners directly.
Vietnam’s fertilizer output is predicted to reach an annual average of 2.3 million tonnes from 2013 onwards. Domestic demand is estimated at 300,000 tonnes a year. Fertilizer exports are thus essential, demanding the expansion of traditional markets and the entry into new ones.
Myanmar’s Ministry of National Planning and Economic Development has licensed Dam Phu My Company to establish a representative office in country, enabling it to advertise its products and facilitate its Myanmar market exports.
The company has produced around 438,000 tonnes of fertilizers since the beginning of this year, ensuring an adequate supply for domestic consumption during 2013’s crop seasons.
Japan transfers rice processing technology
Satake, Japan’s leading agricultural processing and sorting machine manufacturing company, has announced plans to transfer its technology to a Vietnamese company.
The group said their cooperation agreement with Vietnam’s An Giang Plant Protection Joint Stock Company (AGPPS) will see the latter receive equipment and technical assistance during the four processing stages of drying, polishing, assessing, and managing rice quality.
The agreement aims to help AGPPS independently manufacture modern dryers capable of producing germinated brown (GABA) rice. This rice variety’s abundance of amino acids is beneficial to consumers’ health.
As Asia is the world’s major rice production region, Satake plans to transfer its technology to local rice processing firms.
Last year, Satake won a contract to build a large-scale rice-grinding factory for a Cambodian exporter and another to increase the production capacity of a Thai rice processing company.
Tapping into the Russian market
Russia is a potential market for Vietnamese exporters, a conference was told in Hanoi on June 20.
The Ministry of Industry and Trade (MoIT) reported that Vietnamese exports to Russia last year almost quadrupled the 2008 figure, hitting US$1.6 billion.
However, the export structure has shifted from agro-forestry and fishery products to phone handsets and their spare parts.
This is not a positive sign for Vietnam’s traditional export items, while Russia still has a large demand for these products, experts said.
MoIT statistics showed that the ratio of agro-forestry and fishery exports to total fell sharply from 50% in 2009 to 20% in 2012.
According to experts, Russia is a huge market which is in dire need of imports. From Russia, products can be re-exported to Belarus, Kazakhstan and other countries of the Commonwealth of Independent States (CIS).
Eligible items are coffee, tea, vegetables, fresh and frozen fruits, meat and meat products, and seafood.
Chu Xuan Kien, Deputy General Director of the Hanoi Trade Corporation (Hapro), said businesses find it difficult to penetrate this market, especially big supermarkets, due to fierce competition and cumbersome administrative procedures, mostly modes of payment.
La Van Chau, former trade councillor to Russia, suggested that businesses renew technology to improve product quality, promote brands, and take part in trade fairs to establish partnerships.
Household utensil, gift fair attracts 100 businesses
About 100 businesses will showcase household utensils and gifts at a week-long special fair in Hanoi, starting on June 22 as part of Vietnam Family Day 2013.
On display at the 2013 Household Utensil and Gift Fair will be fashionable garments, cosmetics, electronic products, toys, stationery, candies, processed food, handicraft products, and souvenirs.
Cultural activities celebrating Vietnam Family Day 2013 (June 28) will run in conjunction with the fair, such as book reading for children and a space dedicated to traditional Vietnamese food.
Organisers will also run a writing competition themed “Great Dad”, a cooking competition, a flower arrangement competition, a ceremony honouring 40 outstanding families, and an art performance.
International Trade Fair Organising Company (IFC) Director Nguyen Cong Tuan said the fair is a practical response to the “Vietnamese people use Vietnamese goods” campaign.
It also provides a good opportunity for businesses to share their experiences in manufacturing and promoting their brands as widely as possible, he noted.
The fair will be held at the Vietnam Culture and Arts Exhibition Center on 2 Hoa Lu Street, Hanoi.
Vietnamese people observe June 28 as Family Day to promote humanitarian values of family in society.
Quang Ninh promotes trade, investment with Indonesia
A high-ranking delegation from northern Quang Ninh province paid a visit to Indonesia on June 19-20 to seek trade and investment cooperation opportunities with local partners.
During the visit, the delegation had a working session with the Batam Free Trade Zone Management Agency in the island province of Riau to study its development policies.
The Quang Ninh officials also met with leaders of Indofood, the largest food corporation in Indonesia with annual revenues of more than 5 billion USD, to learn about its potential, products and investment and market expansion strategy in Southeast Asian countries, including Vietnam .
At the meeting, Secretary of the Quang Ninh provincial Party Committee Pham Minh Chinh highlighted his locality’s strengths on trade and investment cooperation, noting that Quang Ninh is a centre for mineral exploitation, a leading tourist destination in Vietnam, and an important gateway for good trading between ASEAN countries and China .
The Indofood leaders spoke highly of cooperation potential with Quang Ninh in particular and Vietnam in general, affirming that the corporation considers Vietnam one of its strategic markets in Southeast Asia which serves as a gateway for its products to penetrate China’s southern provinces.
As part of the visit, the Quang Ninh delegation also worked with Indonesia’s National Committee for Special Economic Zone (SEZ) to seek ways to develop SEZs. The two sides discussed interests that SEZs can bring about, difficulties, barriers and risks during the establishment and operation of SEZs as well as some emerging issues in SEZ development.
It also studied the Indonesian Government’s policies and experience in developing SEZs, economic and industrial zones, hi-tech parks and free trade areas.-
Bright prospects for cassava exports
Cassava export earnings are likely to reach US$2 billion if local exporters penetrate the European and US markets, according to Nguyen Van Lang, President of the Vietnam Cassava Association.
He noted that while Vietnam has more than 100 processing factories meeting standards of choosy markets, major markets for Vietnamese cassava are currently limited to Asia such as China, the Republic of Korea and Taiwan.
According to the association’s statistics, the country now has 560,000 hectares under cassava cultivation, with an annual output of 9.4 million tonnes. It has planned to use all the cassava output for the production of bio-ethanol.
However, the economic downturn has delayed the operation of ethanol factories, forcing cassava producers to export their products.
Last year, Vietnam shipped abroad over 4.2 million tonnes of cassava products, bringing home US$1.35 billion, a year-on-year rise of over 57 percent in volume and 41 percent in value.
Vietnam is now the second largest cassava exporter in the world after Thailand.
The country’s bio-ethanol development project has set the target of producing 750 million litres of ethanol for domestic use by 2015, which will need about 4.2 million tonnes of raw cassava.
Firms call for media supports in policy response
Businesses want the media to side with them, reflect their hardships and be their voice against unreasonable policies, heard a roundtable on Wednesday
The roundtable themed Media and Business Community – Issues of Mutual Interests was held by Phap luat TPHCM newspaper in collaboration with Thoi bao Kinh te Sai Gon, Sai Gon Tiep thi, Doanh nhan Sai Gon and television channel FBNC.
Speaking at the event, Vu Anh Tam, chairman of Tai Nguyen Co., said policy quality was worth discussing since many of the current policies were ambiguous and impractical. He hoped the media would reflect business opinions about policy quality.
Le Chi Hieu, chairman and general director of Thu Duc Housing Development Corp. (Thuduc House), said legal and policy risks in Vietnam were higher than in many other nations. There are problems in every aspect and every sector, and legal documents are contradicting each other, he remarked.
To cope with this situation, businesses choose the easiest way, which is to give bribes, he said.
Citing real estate as an example, he said this sector was facing multiple problems such as exorbitant prices, huge inventory and poor liquidity. Both enterprises and the State are to blame for this situation, he stated.
High prices are caused by unreasonable regulations on site clearance compensation, land use fees and corporate income tax, along with sky-high lending rates and cumbersome procedures, he explained.
Tran Van Thanh, chairman of House Vietnam Co., said the economy had been infected with a virus named financial distress. Still, policies are confusing and ambiguous, undermining the confidence of the business community.
Pham Duc Binh, chairman and general director of Thanh Binh Co. in Dong Nai, stressed enterprises were struggling with impractical regulations, which they could hardly satisfy. Therefore, they have to suffer, dodge the laws or violate them.
He suggested that when reporting on businesses, the media should only report what had been completely obvious.
Representatives of many companies said a lot of information on the media was untrue, causing them much trouble. They proposed reporters and journalists be more responsible, always confirming the information they hear and having a deeper thought on every issue.
Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said the media should give their opinions on the State policies right in their draft stage rather than waiting until their release.
Tran Ngoc Chau, director of FBNC, said the business community was a source for economic newspapers. Although the media cannot directly remove difficulties for enterprises, they can exert a pressure on the policymakers.
At the roundtable on Wednesday, Le Hoang Chau, chairman of the HCMC Real Estate Association, Le Chi Hieu and Nguyen Thanh Toai, deputy general director of Asia Commercial Bank (ACB), volunteered to join hands with the editors in chief of Phap luat TPHCM, Thoi bao Kinh te Sai Gon, Sai Gon Tiep thi, Doanh nhan Sai Gon and FBNC to organize regular meetings between the media and the business community.
Coteccons wins huge retail construction packages
Cotec Construction Joint Stock Company (Coteccons) has won two bidding packages totaling more than VND1.3 trillion to construct two commercial centers, with one in HCMC’s District 7 and the other in Binh Duong Province, an executive said.
Tran Quang Quan, deputy general director of Coteccons, said his firm had beaten four foreign contractors, including Japanese and South Korean ones, to win the right to develop the SC VivoCity shopping center on Nguyen Van Linh Street in District 7.
The project is invested by Vietsin Commercial Complex Development (VCCD), a joint venture between Saigon Co.op Investment Development Joint Stock Company (SCID) and Singapore’s Mapletree Co. Ltd.
With the bidding package valued at VND1.2 trillion, Coteccons will have to complete the project with total floor space of some 110,000 square meters in 16 months.
SC VivoCity belongs to the Saigon South Place complex project covering 4.4 hectares comprising a shopping center, grade-A office area and high-class serviced apartments with a total area of 267,000 square meters. The complex costs a combined US$360 million in investment.
In the other deal, Coteccons is picked as the contractor for the Aeon Canary Shopping Center project located along Binh Duong Boulevard in Thuan An District in the neighboring province of Binh Duong.
The firm is contracted to build the shopping center on about 70,000 square meters within seven months for a bidding package of roughly VND120 billion.
The US$95-million project is part of a series of shopping centers that Japan’s retail group Aeon is developing in Hanoi, HCMC and Binh Duong.
With the just-awarded packages, Coteccons raises the total bidding value it has obtained since early this year to VND2.7 trillion, which will amount to VND5.6 trillion if last year’s VND2.9 trillion worth of undeveloped works is taken into account.
Most bidding packages of Coteccons are in the shopping center segment, with no housing schemes recorded, Quan informed.
* Savills Vietnam expects the number of projects under construction and retail space supply in HCMC to rise sharply in the near future.
Total retail space supply of the city now is about 796,000 square meters, which is forecast to double in the coming time with supplies mainly coming from districts 1, 2 and 7.
The average occupancy rate in the first quarter of the year remained unchanged compared to the previous quarter while the average rent posted a slight reduction of 2% against a quarter earlier.
Husbandry industry to overcome hardship, says ILRI
Vietnam’s husbandry industry is facing many challenges but the sector still has many opportunities to overcome hardship and grow in the long term, said a report recently announced by the International Livestock Research Institute (ILRI).
Lucila A. Lapar, an agricultural economist of ILRI, said that meat is a necessary product of consumers and that meat consumption will increase following higher incomes of people in the future. Therefore, the husbandry industry of Vietnam still has opportunities to develop.
Besides, domestic consumers are fond of raw meat rather than imported frozen meat. This is an advantage for enterprises in this sector.
ILRI’s study also provided suggestions for husbandry enterprises to overcome difficulties. Because consumers usually diversify their eating habits, using various types of meat such as seafood, livestock, beef and eggs, enterprises should also provide diversified products to meet their demands. This must be included in long-term strategies of enterprises.
The most important factor is price because it will impact decisions of buyers. Therefore, enterprises must find out ways to reduce costs to launch competitive products onto the market, the report said.
Besides, meat consumers still care about problems such as diseases, food hygiene and safety. The study showed that consumers have given negative responses to pig diseases, with roughly 50% stopping or reducing meat consumption and around one-third have shifted to use other types of meat.
Compared to their Hanoi counterparts, many consumers in HCMC have shifted to modern sales channels such as supermarkets and commercial centers to seek safer meat products. If a disease breaks out, up to 50% of HCMC consumers reached by the survey will stop or reduce meat buying, 15% will buy meat at modern sales venues and 29% will use other meat products.
Second IZ for Japanese investors in BR-VT kicked off
Thanh Binh Phu My Joint Stock Company on Wednesday began construction of Phu My 3 Industrial Zone in Ba Ria-Vung Tau (BR-VT) Province’s Tan Thanh District to attract Japanese investors.
This is the second industrial zone project in BR-VT which directs at Japanese investors. Dong A-Chau Duc Joint Stock Company last month had started work on an industrial zone targeting investors from this country.
According to Pham Quoc Dung, chairman of Thanh Binh Phu My Co., Phu My 3 was picked by the province to become a special industrial zone for Japanese investors.
Phu My 3 Industrial Zone covering an area of 999 hectares consists of four main areas - supporting and multi-disciplinary industries, heavy industries, port and logistics, and utility services. Among these, at least 300 hectares will be set aside for Japanese investors.
Dung said Phu My 3 had its planning designed by Nikken Sekkei Civil Engineering and would become an industrial zone having synchronous infrastructure and utilities meeting international standards.
Besides, it can meet demands of many industries such as petrochemicals, chemicals, basic materials, supporting industries, mechanical engineering, hi-technology, and port and logistics, he added.
According to Dung, having an investment of VND7.26 trillion, Phu My 3 has well-equipped accommodation for staff, workers, engineers and experts with hotel, apartment, shopping center, international school, hospital and park to create a good working and living environment for investors and employees. The industrial zone also provides built-up workshops for enterprises with short- and medium-term operations.
Phu My 3 will use natural gas, liquefied petroleum gas (LPG) and condensate to supply stable electricity and water for tenants. In addition, to save time and costs for customers, the industrial zone provides “one stop service” investment support.
According to Nguyen Thi Thao Nhi, general director of Thanh Binh Phu My Co., Phu My 3 Industrial Zone is located in the Phu My port urban-industrial area. With location advantages, the firm will make Phu My 3 a modern industrial zone and help investors cut production costs.
BR-VT has proposed the Government to consider offering special incentives to attract investors in the supporting industries.
Nhi said that all investments in Phu My 3 could enjoy preferential taxes, including a corporate income tax rate of 20% in ten years after enterprises start operations, a corporation income tax exemption in two years after enterprises gain taxable income and a 50% reduction in the next four years.
Dong A-Chau Duc Joint Stock Company last month kicked off construction of Da Bac Industrial Zone in BR-VT which also directs at Japanese investors. The 75-hectare industrial zone will have land and workshops available for investors in the fourth quarter.
Investors on Phu Quoc likely forced to place deposits
Kien Giang Province authorities are examining investment projects on Phu Quoc Island and will likely force owners of idle projects to place deposits if wanting to invest on this tourism island, a provincial official said.
Le Minh Hoang, director of the provincial Department of Culture, Sports and Tourism, said dozens of investors of slow-moving projects on Phu Quoc have been asked if they could continue their projects or not so that Kien Giang Province can decide on such projects.
“Investors have to give their answers within this month. In addition to pledges on implementation timelines, investors are required to prove their financial strength and pay deposits to ensure the execution of their investments,” Hoang said.
According to Hoang, there are many new investors wanting to invest in Phu Quoc but many projects here are moving slowly. The province is considering setting the required deposit amount, he said.
“It is tentatively put at some 3-5% of the minimum investment amount of a hectare. The current minimum investment ranges between US$1 million and US$1.3 million per hectare,” he said.
The provincial government has recently agreed to revoke the approval-in-principle earlier given to the ecological tourism project Asia Pearl worth two billion euros on Phu Quoc Island. The project was proposed by Trustee Suisse Group and Vinaconex Corporation and expected to be developed in an area of over 2,000 hectares.
In related news, representatives of Kien Giang and other provinces in the Mekong Delta, Thailand and Cambodia made a survey trip last month to study routes connecting provinces of the countries. The survey results show that connections to Phu Quoc Island can be made from provinces and cities in Thailand and Cambodia by overland, sea and air routes.
Overland infrastructure is sufficient but there is a shortage of tourist boats which can sail on international routes as well as flights to Phu Quoc. Furthermore, Phu Quoc is also lacking hotels for tourists.
“This is also the reason Kien Giang Province wants to accelerate the implementation progress of tourism projects on Phu Quoc. The authorities will request relevant agencies to consider operating flights connecting Phu Quoc with Thailand and Cambodia to boost tourism growth,” he said.
CII to issue bonds for city’s infrastructure
The HCMC Infrastructure Investment Joint-stock Company (CII) said on Tuesday it would soon issue VND1 trillion worth of bonds to mobilize funds for infrastructure projects in the city.
Le Quoc Binh, general director of CII, said that after the success in mobilizing funds for building Saigon 2 Bridge, the company has decided to attract funds this way to finance other key infrastructure projects in the city.
CII has been entrusted by the city government to upgrade the Thu Duc Intersection, the BOT Binh Trieu 2 Bridge and Road project, and an approach road connecting the East-West Highway and the HCMC-Trung Luong Expressway. All these three projects are to be executed in the coming time and need huge funds, Binh told the Daily at a function to mark the connection of a main span of Saigon 2 Bridge.
The Saigon 2 Bridge project is developed by CII under the Build-Transfer format at a total cost of nearly VND1.5 trillion, or some US$70 million, with VND1 trillion sourced from a bond issue. The bridge, whose construction began in April last year, will be opened to traffic this November.
In related news, the municipal government has asked the Department of Transport to speed up the progress of three steel flyovers at key traffic intersections in the city. These flyovers, at the junctions of Ba Thang Hai-Nguyen Tri Phuong-Ly Thai To; Cong Hoa-Hoang Hoa Tham; and Cay Go intersection, must be completed in the third quarter this year.
FamilyMart convenience stores change name
Many convenience stores bearing FamilyMart brand in HCMC have been renamed B’s mart.
As observed by the Daily, the change of signs at the stores which were formerly known as FamilyMart outlets has started since the end of last week. Some stores have already resumed business while others have still halted operation.
Phu Thai Group Joint Stock Company, which had earlier joined forces with a Japanese partner to operate FamilyMart stores, has distributed invitations for a press briefing on the establishment of B’s Mart Co. Ltd, which is also the brand seen on the new signs. The meeting will take place in HCMC this Thursday.
In the meantime, local retail companies and multiple suppliers for FamilyMart have circulated the rumor that FamilyMart had already withdrawn from Vietnam.
Up to now, related sides have still kept tight lips on the aforesaid information.
FamilyMart, a Japanese retail brand with over 17,000 stores worldwide, has entered the Vietnamese market since 2010 through a joint venture with Phu Thai.
Up till the change this week, there had been more than 40 stores bearing FamilyMart brand in HCMC, compared to a total 300 stores that FamilyMart planned to open in Vietnam.
The website nhuongquyenvietnam.com earlier said that Japan’s FamilyMart had released a statement on the termination of its partnership with Phu Thai.
Vietnam-invested bank in top 5 in Cambodia
Bank for Investment and Development of Cambodia (BIDC) established by Bank for Investment and Development of Vietnam (BIDV) has been listed among the five largest commercial banks in Cambodia.
In a statement released on Tuesday, BIDV cited a report of the National Bank of Cambodia as saying that BIDC held 7% credit market share and 6% total asset market share in Cambodia as of the end of 2012. The bank has been in the top five largest banks out of 32 commercial banks operational in the country.
In this group, BIDC has reported the lowest bad debt ratio at 1% and has been among banks with the best credit quality. The bank ranked sixth in the market in terms of charter capital, 10th in terms of network and eighth for staff scale.
BIDC is one of the two banks in Cambodia having branches overseas.
In July, 2009, BIDV established Investment and Development Company of Cambodia (IDCC) to acquire Cambodia’s PIB Bank. BIDV then raised capital and restructured the bank for establishment of BIDC.
BIDC started operation a month later with a charter capital of US$70 million, focusing on providing financial services for Vietnamese enterprises in Cambodia and serving as a bridge for business activities between the two markets.
As of the end of May, the bank had had total assets of US$540 million, 3.1 times larger than in 2009 while its outstanding loans more than quadrupled to US$380 million. The bank now has six branches and one transaction point in Cambodia.