Shaking off economic woes, retail sales hit $80 billion in 2010

Despite economic difficulties, the country's total retail sales revenue for commodities and services last year jumped 24.5 per cent against the previous year to VND1,561 trillion (US$80 billion), according to the General Statistics Office (GSO).

Adjusted for inflation, this equated to a 14-per- cent rise, the office said.

The trade sector reported a year-on-year revenue surge of 25 per cent to VND1,229.3 trillion ($63 billion).

The hotel and restaurant sector saw a rise of 21.8 per cent to VND172.4 trillion ($8.84 billion) and figures for the service and tourism sectors increased 23.8 per cent and 28.5 per cent to VND144.6 trillion ($7.4 billion) and VND15.3 trillion ($784.6 million), respectively.

Head of the GSO's Trade Department Le Minh Thuy attributed the surge to increased consumer demand thanks to a series of festivals, including Ha Noi's 1,000th anniversary in October.

The Ministry of Industry and Trade (MoIT) said the Government's consumption demand stimulus policy as well as efficient business practices in taking full advantage of the situation had also contributed to the surge. This policy was manifested in the form of a succession of large promotional offers by both producers and distributors.

According to HCM City's Department of Industry and Trade, businesses that took part in a Sales Promotion Month in September saw sales increase by at least 10-15 per cent compared to the same period last year, including Co.op Mart (up 30 per cent), Vissan (up 23 per cent), Thien Hoa (up 50 per cent) and Fahasa (up 20 per cent).

The Ha Noi Trade Department also reported the capital city's retail sales revenue in November corresponding with the 2010 Ha Noi Promotional Month increased by 16 per cent over the monthly average in 2010. During that time, nine retail companies including Hapro, Huong Anh, Me Linh Plaza, Ebest, Tran Anh and Vissan reported revenue growth of 30-150 per cent.

The retail industry annually contributes more than 15 per cent of the country's gross domestic product (GDP) and employs more than 5.4 million workers, representing over 10 per cent of the total workforce.

MoIT said the domestic market was becoming a fulcrum to foster business and production, and recover growth, thus greatly contributing to the sustainable development of the national economy. With a population of more than 80 million, Viet Nam's retail market remained very attractive to investors, especially those from outside.

A survey conducted in the fourth quarter of last year by auditing firm Grant Thornton Viet Nam showed that the Vietnamese retail market lured more foreign investors than any other market, with 70 per cent of correspondents agreeing that retail was a more fascinating and promising investment field than others such as education, real estate and healthcare.

ANZ co-ordinates loan facility for Hoa Phat

ANZ Bank has co-ordinated a VND600 billion (US$28.57 million) syndycated loan facility for Hoa Phat Energy Joint Stock Co with the participation of Bao Viet Bank, Habubank, Hua Nan Commercial Bank and VIB Bank. Hoa Phat Energy is a subsidiary of the Hoa Phat Group.

Dutch group builds third feed plant

The Netherlands-based feed supplier Group De Heus has commenced construction on a US$15 million feed processing plant in Dau Giay Industrial Park in the southern province of Dong Nai, the group's third feed plant in Viet Nam. On an area of 52ha, the plant is expected to begin operations early next year, with a designed capacity of 300,000 tonnes per year.

Southern Food Corp to export 2.4m tonnes

The Southern Food Corporation predicts that it will export 2.4 million tonnes of rice this year, worth US$1.2 billion. This would represent a significant decline from 2010 exports of 4 million tonnes. Projected exports to the Philippines would total 1 million tonnes, and shipments to Malaysia were expected to reach 400,000 tonnes, with Indonesia and Bangladesh to buy the remainder.

Co-op to export 100 tonnes of mangos

The Hoa Loc Co-operative in the southern province of Tien Giang expects to export 100 tonnes of mangos to Japan in 2011, according to Dang Van Vu of the co-operative's control board. The first products would be delivered after Tet (Lunar New Year), Vu said.

The co-operative, with plantations covering areas of 60ha in total and a yield of 500 tonnes per year, also exported 100 tonnes of mangos to Japan last year, worth a total of VND2.2 billion (US$104,700).

Nghe An attracts $4.9 billion investment

The central province of Nghe An registered 287 projects and attracted total investment of VND99.3 trillion (US$4.7 billion) during 2006-10. Major foreign-invested projects included the $1 billion iron mill of Kobelco Viet Nam and two $4 million projects by Big C and Global Farm Co.

Among domestic projects were the $350 million TH milk plant, the $114.9 million Smart Vinh City, a rubber plantation worth VND704 billion ($35.2 million), and VND1 trillion ($51 million) plantation forest project.

Stabilisation efforts trigger more price cuts for staple goods

Some of the14 enterprises taking part in the HCM City price stabilisation programme will cut the prices of staple goods even further on the days near Tet (Lunar New Year) Festival, according to a recent report in Tuoi tre (Youth) newspaper.

On Wednesday, the chairman of HCM City People's Committee, Le Hoang Quan, led an inspection of goods storage for Tet at three key companies taking part in the price stabilisation programme.

Nguyen Thi Hanh, general director of Saigon Co.op, which is assigned to stabilise the price of seven of the total of eight staple goods, said her company had given around VND200 billion (US$10 million) to suppliers in advance as seed capital.

Of that amount, the company advanced VND22 billion to farmers and co-operatives that produce vegetables and fruit that fluctuate wildly in price.

Saigon Co.op had stored 150,000 tonnes of goods, accounting for VND1.2 trillion in value, Hanh said.

The company would also reduce the price of staple goods, including pork, chicken, egg, vegetables and fruit, on the days near Tet at a rate lower than originally registered, she added.

Pham Thi Huan, general director of Ba Huan Co Ltd, one of the leading fresh egg suppliers in Viet Nam, said the company was providing 1 million eggs a day to the market, and expected to increase the number from 1.5 million to 2 million per day during peak days.

The company has an advantage to purchase eggs because it can exchange foodstuff for eggs from farmers.

The company offers breeding poultry and foodstuff to farmers at a price that is 10 per cent lower than the market price, then purchases eggs at a price higher than the market price by VND200 – 300.

Van Duc Muoi, general manager of Vissan, the city's major food processing company, said the company had stored 58,000 pigs to satisfy the demand of pork before and during Tet.

The company planned to slaughter 30,000 pigs and 1,200 cows to offer meat to the market during the month before Tet.

The slaughter would be increased for five days near Tet to meet market demand and keep the price stable, Muoi said.

Besides preparing enough goods to control the market, enterprises had also developed and expanded the distribution network, the inspector team noted.

Eggs of Ba Huan have appeared at 30 markets, 40 authorised dealers and 400 retail outlets and itinerant shops in the city's outlying districts of Can Gio, Cu Chi and Binh Chanh.

Muoi said his company had increased the number of sales staff, expanded service times, and opened several outlets of Vissan in suburban areas and industrial parks.

"We have plans to transport goods to every distribution channel. In emergency cases, we will appoint motorcycles with frozen casks to bring goods to areas blocked by traffic congestion," Muoi said.

Hanh of the Saigon Co.op said her company had in the last few months sold an amount of goods that was double or triple the volume of commissioned stabilised-price goods.

The chain sold an average of 635 tonnes of sugar per month in comparison with the commissioned 200 tonnes. Similarly, it sold 621 tonnes of cooking oil although the commissioned amount was 450 tonnes.

Because more purchases were expected in coming days, the company planned to extend the service time to 7am – 11pm during a 10-day period before Tet.

It would also re-open supermarkets from the morning of the second day of the Lunar New Year.

Saigon Co.op has more than 150 food stores, including 50 supermarkets and 16 Co.op food stores.

HCM City People's Committee Chairman Le Hoang Quan said the volume of stored goods for Tet had increased by 30 – 40 per cent over last year.

Quan has told enterprises to ensure hygiene and safety for price-stabilised goods, and offer prices 5-10 per cent lower than market price.

He also asked authorities to impose severe sanctions on commercial speculation.

Beginning January 12, the city will have market inspections on price, hygiene and piracy.

According to Quan, the price stabilisation programme for staple goods, which included financial support at no interest to companies, has had very positive results.

It has helped the city's Gross Domestic Product (GDP) expand 11.8 per cent year-on-year and kept the Consumer Price Index (CPI) at 9.58 per cent, much lower than the national CPI of 11.75 per cent.

The programme has also helped enterprises take advantage of opportunities for further growth.

This year, the city plans to expand the price stabilisation programme to ensure that the city's GDP will grow at a 12- per- cent rate and that social stability will continue.

Hard times fall on local cement manufacturers

Domestic cement producers are set for an uncertain future, with supply expected to exceed demand in the coming years, according to Nguyen Nhu Khue, director of Bim Son Cement Joint Stock Company.

According to a report made by the Viet Nam Construction Materials Association, the national cement production would reach 55 million tonnes this year, surpassing demand by between 3 and 4 million tonnes, and under an industry plan, cement output would reach 100 million tonnes in 2020.

In addition, a series of new cement plants and the expansion of existing ones would lead to the stockpiling of cement. It is predicted that the domestic cement industry would see a redundant supply of 7 million tonnes this year and 15 million tonnes in 2012.

The Bim Son Cement company recently put its second production line into operation to raise production capacity to nearly 4 million tonnes per year.

Deputy Minister of Construction Nguyen Tran Nam said next year, local cement production would be more competitive due to redundant output. Along with domestic consumption, the Ministry of Construction proposed that businesses increase exports to reduce competitive pressure on the domestic market.

If businesses looked for new customers, the industry could export between 5- 7 million tonnes next year, said Nam.

Anticipating fierce competition, the Ministry of Construction asked provinces to temporarily stop issuing licences for new cement projects at the end of 2009, and this year, the ministry has continued to enforce licensing criteria with regards to exports from joint venture cement manufacturers.

However, Deputy Minister Nam admitted the reasons that the country's cement exports were limited were high product prices and a large investment ratio, combined with difficulties in infrastructure and inland transport.

The industry as a whole must work hard to boost exports, he said.

Top 2010 securities brokerages announced

Saigon Securities Inc (SSI) held the largest fourth quarter brokerage share in the HCM City Stock Exchange in 2010, according to a report issued by the HCM City Stock Exchange this week.

The report showed that SSI accounted for 11.6 per cent of the market, beating Thang Long Securities (TLS), the market leader in the three previous quarters, by 3.2 per cent.

In second place was HCM City Securities (HSC), with 8.71 per cent, followed by TLS with an 8.4 per cent market share – a decrease of nearly 3 per cent from the third quarter.

VPBank Securities made the top 10 brokerages for the first time in the fourth quarter, coming in seventh, along with the return of Kim Eng Viet Nam Securities and Bao Viet Securities in eighth and ninth, respectively.

Despite being downgraded to third place in the fourth quarter, TLS finished top for the whole of 2010 in the HCM City market. The company accounted for 10.04 per cent of the brokerage market share; followed by SSI, with 8.9 per cent and HSC, with 7 per cent.

Nation achieves average five-year growth of 7%

Viet Nam has taken great strides in ensuring sustainable development over the past five years with an impressive average annual GDP growth rate of 7 per cent, in spite of difficulties and challenges from the world economic crisis, the third national conference on sustainable development heard yesterday.

All economic sectors recorded steady development. Agricultural production in particular continued to develop sustainably, ensuring food security while creating sources of commodities for export, said Deputy Minister of Planning and Investment Nguyen The Phuong.

Regarding social issues, the country fulfilled the target of reducing the poverty rate to below 10 per cent by the end of 2010, equal to 1.7 million households, while social security was particularly focused upon amid the context of inflation, natural disasters and diseases, he said.

Education and training quality had been continuously improved as more focus was put on renewing education content, curricula and teaching methods, particularly in remote, disadvantaged and ethnic minority-inhabited areas. Investment in the sector from the State budget increased from 15.5 per cent in 2001 to 20 per cent in 2007 and the number of trained workers reached 40 per cent in 2010.

"The country formed many policies to create conditions for labourers to catch up with the development of the market economy and international integration with more than 8 million workers employed over the past five years, bringing the unemployment rate down to 4.6 per cent", Phuong said.

"The country has fulfilled all millennium goals and surpassed its commitments to the international community", he added.

Concerning natural resources and the environment, Phuong said a legal framework for managing and protecting resources and the environment was being finalised towards a sustainable development target with the establishment of a system of management agencies from central to local levels and a series of related legal documents.

The co-operation between the resources and environment sector and others helped raise the efficiency of resource management and environmental protection. The speed of pollution was limited, the environment quality in some areas was improved and local residents had a better awareness of their own interests as well as their responsibility for the environment.

Phuong stressed that climate change was considered the biggest challenge for sustainable development at present so the country had to actively integrate the national target programme to cope with climate change with development strategies, policies and planning.

However, Deputy Prime Minister Nguyen Thien Nhan, who doubles as Chairman of the National Council For Sustainable Development, said there remained many shortcomings that needed to be addressed.

There lacked close direction from relevant ministries and agencies, information dissemination was not focused, production output of many sectors tended to decline, environmental pollution failed to be reduced, the income gap had increased and the development of science and technology failed to meet real demand, he said.

He said the country should have both medium- and long-term solutions and roadmaps to ensure macroeconomic stability and balance capital, land, human resources and energy to ensure sustainable development, focusing on balancing human resources.

"It is essential to supervise export development, use the budget effectively, invest in disadvantaged areas, uphold the role of science and technology effectively and provide more support for the development of small- and medium-sized businesses," he said.

"It is also important to have criteria to assess the process of sustainable development, focusing on domestic green products, the supervision of production output, the abidance of laws by organisations and individuals, social security rate and the ability to access information via the internet," he added.

Sharing experience in sustainable development, United Nations Development Programme Policy Advisor Koos Neefjes said the conference was one example of the country's commitment to sustainable development and reconfirmed its strategic orientation toward sustainable development.

"Viet Nam successfully mainstreamed sustainable development in the 2006-10 social economic development plan and the Prime Minister, in his New Year's message just a few days ago, emphasised that the country must continue to transform its growth model and make sure that development is harmonised with economic growth and environmental protection. These three pillars are central to sustainable development," he said.

However, the advisor said, national and global sustainable development were being threatened in several ways which could undermine development achievements. For Viet Nam, it was critical to accelerate performance of millennium goal 7 (MG7) on sustainable development as it lagged behind on MG7 indicators, such as per capita CO2 emissions and the proportion of the population using improved drinking water and sanitation facilities.

"The country needs to step up efforts to reverse these trends in the next five to ten years, for example by strengthening human resources and technological modernisation, especially with green, clean technology," he said.

"Anthropogenic climate change is globally the biggest sustainable development challenge humanity is facing in this century and Viet Nam suffered significantly from human and material losses due to climatic disasters in 2010, which are estimated to have cost the country more than 1 per cent of GDP annually over the past two decades.

"The Prime Minister in his New Year message indeed highlighted the fact that Viet Nam was very vulnerable to climate change. He stressed that Viet Nam would actively implement the National Target Programme to Respond to Climate Change and strengthen international co-operation in this area," he said.

Concluding the conference, Nhan instructed the Ministry of Planning and Investment to promptly finalise reports to submit to the Prime Minister for sustainable development orientation during the 2011-20 period and the national action plan to implement the orientation in February. He also required localities to build and finalise their own action programmes by June this year.

On the sidelines of the conference were five forums on sustainable development in economy, society, education, business and resources and the environment.

ACB bank building $2 mln data center in HCM City 

Ho Chi Minh City-based Asia Commercial Bank (ACB) Thursday launched the project of building a new data center worth US$2 million here, with IBM partnering in the information technology plan.

The Enterprise Module Datacenter, to be situated in the Quang Trung Software City in District 12, aims to standardize the fast expanding banking group’s IT infrastructure, ACB said. 

IBM and Vietnam’s Asia Information and Communications Technology Company (AICT) do the work of design, architecture and construction of the data center, which is set for completion in four months.

“We believe that advanced technology, expertise and experience from IBM as well as AICT will be a key factor to the success of the ACB long-term development strategy,” said ACB vice chairman Le Vu Ky.

He added that his banking group has currently total assets of about VND200 trillion (around US$10 million) and this number is expected to rise to VND800 trillion by 2015, as ACB plans to become a top financial institution in the country by that year.

Mr. Ky said in the next five years, the number of ACB outlets would triple from the current 300, and the number of customers would be 5-7 times higher than now.

PV