2012 CG meeting opens in Hanoi

The 2012 Consultative Group (CG) Meeting for Vietnam officially kicked off in Hanoi on December 10, with a view to creating firm foundation for sustainable growth.
Addressing the opening ceremony, Minister of Planning and Investment Bui Quang Vinh highlighted Vietnam’s remarkable achievements in recent years and pointed out challenges facing the country in the future.

He affirmed that the Government is speeding up the disbursement process and increase the efficiency of official assistance development (ODA) for national development.

He called on international donors to continue providing Vietnam with more ODA funding, which he said, is a valuable source for the country’s poverty reduction and development programmes.

“We commit to cooperate closely with international donors to improve the effectiveness of ODA disbursement and conduct negotiations in a more effective manner,” Vinh said.

Country Director of the World Bank (WB) in Vietnam, Victoria Kwawa spoke highly of Vietnam’s marcoeconomic achievements over the years. However, she said, the country’s competitiveness remains low, resulting in modest economic growth. It requires stronger commitments from the Government to consolidate people’s trust and get the country out of the middle-income group.

She voiced support for Vietnam’s preferential tariff policies, but urged the country to focus on improving the quality of human resource training and education, and dealing with land-related issues.

Japanese Ambassador to Vietnam, Tanizaki Yasuaki, suggested renewing growth models to ensure sustainable growth. Vietnam should create added values in the industrial sector and use foreign direct investment (FDI) effectively, he said.

There must be a long-term strategy for ODA disbursement in an effective way to help local businesses iron out their snags.

The three-day CG meeting will also hear an important speech by Prime Minister Nguyen Tan Dung and other keynote speeches by representatives of international donors and civil society organizations.

For better work efficiency

Latest research by Regus surveying over 20,000 senior managers and owners in business in more than 80 countries finds that worker’s must-have desk items include non-spill mugs for the butter-fingered among them, cutesy tiny bears, stress balls and motivation charts for the more highly strung.

More traditional responses are family photos, cherished by one in five respondents (18 per cent), useful business cards (13 per cent) and art work (10 per cent) providing inspiration and perhaps some degree of escape from the daily grind.

Religious ornaments and lucky charms ward off negative work vibes, while diplomas, certificates and trophies remind workers of past achievements and spur them on. For the eternally youthful dolls and miniature cars keep playfulness alive on the office desk.

Filippo Sarti, Regus Asia CEO comments: “We spend so much time with our colleagues in the workplace that it is easy to assume we already know all that we need to know about them, but this survey reveals that workers globally rely on number of objects to make them feel more at home, to keep them close to their loved ones or just to help motivate and get them get in the work-zone. This survey confirms the importance of the workspace as a place where workers need to feel at ease and able to express their personalities, even the most unusual traits!”

Regus is the world’s largest provider of flexible workplaces, with products and services ranging from fully equipped offices to professional meeting rooms, business lounges and the world’s largest network of video communication studios.

Over 1,000,000 customers a day benefit from Regus facilities spread across a global footprint of 1,200 locations in 550 cities and 96 countries, which allow individuals and companies to work wherever, however and whenever they want to. Regus was founded in Brussels, Belgium in 1989, is headquartered in Luxembourg and listed on the London Stock Exchange.

Expert claims tycoon arrest disrupts investor confidence

The arrest of banking mogul Nguyen Duc Kien on August 20 indicated the difficulties of Vietnam’s economic situation to investors, one expert said.

Dr. Edmund Malesky, an US economist, made the comment after conducting a survey of over 8,177 domestic private firms and 1,540 foreign companies in Vietnam.

The incident was a great shock to both Vietnam’s stock market and the international financial community, pulling down HoSe and HNX indexes, Malesky emphasised.

“This was a bad day and affected investor confidence in the market. Before the incident, several investors said that they had positive plans or expected to expand business in the time to come. However, many of them have seemed to have changed their minds,” he assessed.

According to him, enterprise confidence had dropped to its lowest point in 2012, at 33%, since the release of the country’s provincial competitive index (PCI). The rate stood at over 47% last year and around 45% before Kien’s arrest.

The number of questioned enterprises that had plans for business expansion next year fell to only 24%, he noted.

“We’ve found that most enterprises were worried about the macroeconomic situation rather than having their assets revoked or financial instability,” he said.

When talking about corruption, before August 20 up to 48% of enterprises admitted that they paid commissions or gave bribes to get purchase contracts with state agencies but they seemed to be reluctant to give answers after that.

Meanwhile, many enterprises avoided the question and considered it too sensitive to discuss. Only 27% of enterprises admitted having paid bribes after Kien’s arrest.

Foreign invested companies were also affected by the incident, including those from the Philippines, Italy and Malaysia, according to the survey’s results.

The larger enterprises, the more they were affected by the incident, he added.

Real estate prices forecast to reach record low in 2013

Prices in the Hanoi real estate market, especially the high rise sector, are dropping, but have yet to attract customers.

Many projects by big investors such as Hoa Phat Group and Construction joint stock company No9 (Vinaconex), even in 'prime locations' are also being sold at discounts of 15-30%.

The Mandarin Garden's apartment complex was selling homes for VND45 million (USD2,160) per square metre in 2010. Now they are being offered at VND26 million per square metre without furniture or VAT. The project was thought to have great potential, but has only sold 110 out of 1,000 apartments.

Afterwards, other projects in the area also started to lower their prices. Prices at the Eurowindow Multi-complex were lowered from VND55 million per square metre to VND25 million with VAT.

Other unfinished projects have also reduced their prices. The investors have reduced the price of apartments in Discovery Complex in Cau Giay District from VND45 million per square metre to only VND27 million.

Despite the lowered prices, customers have not shown much interest.

Even though the price per square metre has been lowered, the total price of such an apartment can still be quite high because many of them are large.

Confidence in uncompleted projects is also low, with many fearing that they will end up losing on their investment in the long-term.

The fact that these apartments are being sold for less than the initial prices does not help in terms of confidence. Also, many fear high and sometimes unpredictable service fees, which can be VND10,000 per square metre, along with the VAT on their home.

Around 20 projects have lowered their prices and in 2013, real estate prices are expected to fall further.

Lacking capital, the investors may have to sell-off their projects in order to avoid defaulting on their debts.

Consumer goods obtain strong sales growth

Fast moving consumer goods (FMCG) such as packaged food products, cosmetics, dairy products and beverages have still achieved high growth in the Vietnamese market despite economic difficulties, according to a survey.

Kantar Worldpanel in its latest survey on shopping behaviors said the growth of FMCG in Vietnam was higher than in regional countries.

The survey revealed that the total volume of FMCG in 12 months to September this year increased by 15.6% in Vietnam from the same period last year and by a couple of percentage points from this year’s two previous quarters.

Meanwhile, many ASEAN countries surveyed posted FMCG growth of less than 10%, with 9% recorded in Thailand, 5.1% in Malaysia and 4.2% in the Philippines. Besides, in the Philippines and Malaysia, FMCG in the third quarter failed to maintain its growth obtained in the two previous quarters.

In Vietnam, the growth of some product groups was quite high, with a year-on-year growth of 14.3% achieved by the beverage group. This figure was much higher than the growth of 10.9% and 11.5% recorded in the first and second quarters respectively.

Products such as energy drinks, nutritional drinks and soymilk increased strongly by 41%, 37% and 37% respectively, showing that consumers have now cared more about their health.

In addition, consumers have bought more products for personal care and home care as well as basic products such as dishwashing liquid and shampoo.

Similarly, basic package products like sauces and instant noodles also rose by over 15% in value.

According to the survey, 60% of FMCG are purchased at grocery stores and markets, and this traditional channel is the main shopping venues of FMCG.

However, Vietnamese consumers are shifting their shopping from this traditional channel to modern channels like shopping centers and supermarkets where they can buy products having a lower price and enjoy many promotions.

This tendency has narrowed down the traditional channel. While the annual growth of traditional trade was 16%, modern trade had a growth of up to 19%.

The group of hypermarkets, supermarkets and convenience stores has maintained its growth of 24% per year thanks to the development of new stores, especially convenience ones in recent times.

FIEs gain US$10.5 billion in trade surplus

Foreign-invested enterprises (FIEs) enjoyed a trade surplus of US$10.5 billion in the year to date, while their local counterparts recorded a trade deficit of US$10 billion.

As of end-November, FIEs had exported US$65.5 billion worth of products and imported US$55 billion.

“The country’s balance of trade does not suffer a severe maladjustment thanks to FIEs,” said Tran Thanh Hai, deputy director of the Import-Export Department under the Ministry of Industry and Trade.

FIEs mainly operate in the processing industry with big export volumes and high added value. They are overwhelming local firms in export of certain items such as cell phones, whose Jan-Nov export turnover hit US$10 billion.

In addition, FIEs make a great contribution to the textile-garment industry with an export turnover of US$13 billion. They also play a major role in export of oil and gas, leather-footwear and electronic components, said Hai at a press conference held by the trade ministry on Tuesday.

On the other hand, Vietnamese enterprises mainly export roughly-processed agro-aqua-forestry products. Therefore, both export values and profits are low.

Even in rice export, the benefits are minimal.

“We are proud of becoming the number-one rice exporter in the world with a growth of 3% in export volume, but the value has fallen by 5%. Moreover, prices of rice and other farm produce frequently fluctuate depending on weather and the global market, and thus both export turnover and added value are low,” said Hai.

The export turnover of Vietnam in November is estimated at US$10.2 billion, down 1.2% against October but up 14.2% over the same period last year. In the first 11 months, the country gained US$104 billion in export turnover, a year-on-year growth of 18.4%.

Meanwhile, the November import turnover is put at US$10.25 billion, up 0.8% against the preceding month and 7% year-on-year. Overall, Vietnam imported US$103.99 billion worth of products in the Jan-Nov period, rising 6.8% over the same period in 2011.

Traders offered high discounts on Tet goods

Local producers such as Vissan, Saigon Food, Bibica and Vinamit offered discounts of up to 20% to small traders and agents at the Tet goods launching day in HCMC on Tuesday.

The event, which was organized at the Continental Hotel by Vietnam High-Quality Goods Business Association, attracted 13 enterprises offering various discounts and gifts to traders.

In the food sector, many companies such as Vissan, Thuan Phat, Lien Thanh, Tai Tai, Saigon Food, D&F and Vifon provided discounts from 5-20% for traders placing orders at the fair.

Vissan gave a reduction of VND8,000 on each kilo of Chinese sausage for orders from now to December 12 and VND6,000 a kilo from December 13-23. However, these discounts were offered to customers making immediate payment.

Meanwhile, D&F pork pies and canned food of Dong Nai Food Processing factory carried discounts from 5% to 10%.

Saigon Food Joint Stock Company gave a 15% discount for customers ordering rice porridge and instant seafood products. Thuan Phat Company offered discounts of 20% for orders placed on the day while Lien Thanh Company gave gifts or reduced prices at the fair.

For consumer goods, Duy Thanh Company applied “buy 10 get 1 free” policy on many products while Sunhouse gas stove producer gave direct discounts on orders from VND6 million each.

Confectionery and beverage producers Bibica and Bidrico applied an 8% discount for large orders. Vinamit Company launched promotions on new products such as dried lotus seed and instant coffee.

Vinamit Company received many orders for its new products but with moderate quantity.

Ngo Thi Hoang Mai, deputy director of Lien Thanh Seafood Processing Joint Stock Company, said that many small traders had bought its Tet gift hampers. Some traders ordered large quantities and were introduced to distributors in their areas.

Some producers such as Saigon Food, Haiyih and Bibica also introduced many new products to agents and small traders at the event.

Card payment more popular among consumers

More Vietnamese consumers are using cards to make payments when shopping, so enterprises should pay attention to this change in consumption habit to adopt better sales policies.

If making good use of this payment method, enterprises will be able to achieve stronger sales and offer more benefits for consumers, said David Chan, vice president of MasterCard International, head of Market Development in South East and South Asia.

“Enterprises can participate in marketing promotion programs for cardholders of banks to sell their products at low prices. Via payment cards, they can also diversify their sales channels by selling their products online,” said Chan at a seminar on year-end sale promotions held in HCMC on Tuesday.

If consumers did not make cash payments, enterprises could cut cost of cash counting and related costs in the current tough times.

Vietnam now has a considerable number of consumers using payment cards, said Chan. The latest statistics of Euromonitor shows that the number of card accepting machines in the country has reached 44,000.

The number of payment cards, including debit cards and credit cards, is around 36.6 million, equivalent to some 175 million transactions. A cardholder on average makes 4.8 transactions, with the value of each transaction at US$36.

Sharing the same view, Nguyen Huy Vu, commercial director in charge of cooling appliances at Nguyen Kim Shopping Center, said the more common use of payment cards is in line with the shift from traditional shopping channels to the modern ones.

In 2009, up to 82% of consumers went shopping at traditional markets and retail shops while only 18% chose to shop at supermarkets and commercial centers. In 2012, the percentage of shoppers in modern supermarkets and commercial centers has grown to 30%.

In 2008, a mere 2% of consumers used cards to make payments at Nguyen Kim, versus a hefty 98% paying in cash. This year, the percentage of those using cards has risen to 10%, and even reached 25% when sales promotions programs took place, according to the statistics of Nguyen Kim.

At the aforesaid seminar, participants called for stronger collaboration among enterprises to spur the demand, offer more benefits for consumers at the year-end period and overcome current difficulties of the economy.

Steven Goh, Executive Chairman of Retail Asia magazine, said that the global economic recession has left a huge impact on the retail of many regional countries, including Vietnam. To overcome difficulties, retail firms should cooperate with each other and make full use of their strengths to better serve consumers.

Specifically, enterprises can take advantage of technology by selling products and sending their messages to consumers via social networks and mobile devices.

Nguyen Huy Vu from Nguyen Kim Joint Stock Commercial Company said the cooperation between enterprises helped Nguyen Kim sell more products. For example, this year, Nguyen Kim has launched a large-scale promotion program with more products and discounts offered by not only electronic groups but also banks, credit institutions and retail group, he added.

The seminar was also attended by representatives from Sony Vietnam, Samsung Vietnam and Intel Vietnam among other high-profile names.

SJC gold reprocessing at snail’s pace

Reprocessing deformed and substandard gold into SJC gold of Saigon Jewelry Company has come to a standstill, arousing concern in credit institutions over low SJC-brand gold liquidity.

At the moment, SJC has reprocessed only 165,000 out of 400,000 gold taels that has got approval for reprocessing. While deformed gold has been wholly reprocessed, it is more difficult to transform non-SJC gold, which is mostly owned by banks, and the progress is moving slowly due to time-consuming evaluation steps.

SJC each day reprocesses only 2,000 gold taels while its capacity is up to 50,000 taels per day. Gold evaluation is very slow as there are not enough testing machines, said Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch.

Banks earlier mobilized various brands of gold but customers now withdraw SJC gold only as per the agreement between banks and depositors. As the ban on gold mobilization has been valid, banks have to prepare a large volume of SJC to repay their clients.

If SJC gold is not reprocessed timely, banks will have to buy gold to pay their clients, piling huge pressure on the market, Minh explained.

Up to now, there has been no approval for temporary export of gold bars to re-import gold bullion to shorten the evaluation time.

Nguyen Thanh Toai, deputy general director of Asia Commercial Bank (ACB), said if this scheme was approved, gold reprocessing would be faster and banks would not have to advance money to buy gold.

For any solutions, banks still suffer losses due to the gold price difference, which is over VND3 million a tael now. A tael is equivalent to 1.2 troy ounces.

Therefore, ACB hopes that the scheme of temporary gold exports will obtain approval to help banks improve gold liquidity, Toai said.

The gold mobilization ban at banks has yet to stimulate gold selling. SJC deputy sales director Nguyen Cong Tuong said that the enterprise still trades between 800 and 1,000 gold taels a day, which is similar to the period before November 25 when the ban took effect.

In related news, Minh added that there were 21 units, comprising 13 enterprises and eight banks, registering to trade gold bars under Decree 24 as of December 3. Eligible units will receive licenses to begin their business early next year.

Information security market will still grow well

 The local information security market will still grow well as companies are prioritizing budgets for information security despite the current economic slump, heard a conference held in HCMC on Tuesday.

At the Southeast Asian Chief Information Security Officer conference, Tran Le Quan, head of the corporate information research department of IDG ASEAN, remarked that local firms are still setting aside budgets to prevent risks

“Given the increasingly-complicated risks in information security, Vietnamese enterprises have still set aside parts of their budgets for the 2013 information security,” he said.

“Our research shows that local companies are increasingly aware of the important role of information security for their business activities,” Quan said. “A large number of businesses said they have plans to increase budgets for information security next year regardless of the difficulties of the economy,” he noted.

The report of IDG indicates that the size of the Vietnamese information security market reaches US$28.5 million this year. The group predicts the value at US$33.64 million in 2013 and at US$67.5 million in 2016, or an annual growth rate of over 15% in the coming years, IDG forecasts.

As much as 72.5% of local entities when asked said they would maintain the investment for information security or even would raise the budget further in spite of the gloomy economic prospects. Banks, financial institutions and consumer goods companies will be those pouring the highest investment into information security next year.

Autos, bikes might be included in hi-tech group

The newly-established automobile and motorbike working group of the Vietnam Business Forum (VBF) which started its annual meeting in Hanoi on Monday has suggested putting the auto and motorbike industries into the high technology group to be given incentives for further development.

According to the group, the auto and motorbike industries now are not subject to any investment incentives in line with the orientation to develop the hi-tech industry. Therefore, the group has suggested adding the industries into the hi-tech group to enjoy other incentives accordingly.

International practices and reality show that the auto and motorbike industries play an important role in technological advancement worldwide, the group said.

Also, the industries’ development is closely related to the development of national technology levels, skills and know-how and the education system. The number of engineers of a country is a vital measure for the renovation ability and competitiveness of that nation.

Especially, investing into supporting industries and manufacturing a number of high-value parts like engines, engine components and electric systems have a very important meaning in helping Vietnam shift from the cost advantage to the technological sustainability.

Metallurgy, mechanics and part production with high precision are the important manufacturing processes of the auto and motorbike industries. But the processes are still underdeveloped in Vietnam due to the absence of technological know-how.

A strong encouragement mechanism will help reduce risks of new local firms joining the market.

At the moment, identifying which levels or what kind of taxes will be applicable depends on the origin of vehicles and this is a challenge. It is because preferential treatment may be effective with the application of different bilateral agreements such as ASEAN Trade in Goods Agreement, Vietnam-Japan Economic Partnership Agreement or ASEAN Free Trade Area.

Consequently, a road map for applying different taxes and policies to the auto and motorbike industries by 2015 will bring about benefits to the industries, customers and the country in general, the group said.

The stable tax regime and policies in the long term will consolidate confidence of investors, thus stimulating the industries’ growth.

More delayed projects set to go

Many localities have shown a strong determination to revoke licenses of investment projects whose deployment has fallen behind schedule.

The central province of Binh Dinh has over the past three months cancelled many foot-dragging projects in the province. According to the provincial Department of Planning and Investment, the local government has withdrawn eight delayed schemes, including four in tourism, two in trading and services and two others in forestry-products processing.

The authority of Nhon Hoi Economic Zone in the province has done away with a number of projects. Binh Dinh will continue to review and evaluate the possibility of revoking slow-moving schemes in the coming time, with many in tourism and industrial manufacturing industries, Huynh Thi Thanh Thuy, deputy director of the planning and investment department, said.

The move is aimed to make the local investment environment healthy, canceling those projects whose investors are financially incapable, she said. The withdrawal of slow projects is also aimed at creating opportunities for other investors to find out good projects and venues to make investments and to do business.

Similarly, the southern province of Ba Ria-Vung Tau is also wiping off slow-moving projects.

The provincial Department of Planning and Investment said the province in the year to date has withdrawn investment licenses of 40 projects due to slow progress. The projects facing the axe include 16 foreign-invested schemes and 24 local ones with total capital of nearly US$90 million and more than VND9 trillion.

Apart from canceling unfeasible projects, the province has held direct talks with investors to learn and remove difficulties they are facing in a timely manner. The province has carried out a host of comprehensive solutions with an aim to support the developers to execute their projects soon.

In the meantime, Long An Province since the year’s beginning has applied stricter punitive measures against foot-dragging projects, especially those failing to develop infrastructure of industrial zones and residential areas on schedule as committed.

Long An has been determined to either take back investment decisions or eliminate planning zones ineffective or having financially-unqualified investors, comprising about 20 local and foreign projects.

The Central Highlands province of Lam Dong authorities have recently adopted a heavy hand to tackle investors slow in implementing projects. Lam Dong has already recalled eight forest-related projects for late execution and deforestation.

The Ministry of Planning and Investment has no longer attached much importance to granting new investment licenses. Therefore, it is easy to understand the aforesaid moves of localities to gradually rule out incapable investors whilst enhancing support to capable ones.

Da Lat software park built next year

Work will start next year on the US$38.4 million Da Lat software park in the central highlands Lam Dong Province.

A construction plan of the park in Lac Duong District, just announced, shows it will be built on 63ha over seven years.

The park will include areas for IT production and training, exhibition, conferences and seminars, a centre for trade, services, entertainment and sports.

A full 50ha of the land area will be used to grow trees.

The development is expected to help the province compete for investment and improve science, technology and the economy.

The provincial authority will co-operate with HCM City on the project. A branch HCM City's Quang Trung software park will be built in the Da Lat software park.

Trade surges in Khanh Hoa

The central province of Khanh Hoa has breached the US$1 billion dollar mark for the very first time with its export turnover this year, leading to a healthy looking balance sheet.

Having recorded US$1.1 billion worth of export turnover in the first 11 months of the year, the province's import turnover hit $577 million during the same period, leading to a trade surplus of $466 million.

The huge trade surplus ranks the province as one of the highest in the country.

The export turnover comfortably exceeds the year's target of $950 million and represents a 22 per cent increase over the same period last year.

The main export commodities are coffee, sea products, vessels, garments and textiles, while import commodities include machinery, equipment, animal feed, tobacco materials and chemicals.

About 37,000 tonnes of coffee, an increase of 56 per cent, 57 tonnes of sea food, a growth of 13 per cent, garments and textiles, an increase of seven per cent, 15 vessels, among others, have been exported.

Local enterprises said they would produce and export as much as possible before Tet (The Lunar New Year) which takes place next February.

NZ goes nuts over VN cashews, other products

Viet Nam exported US$147.71 million worth of goods to New Zealand over the first 10 months of this year, a 21 per cent year-on-year increase, according to statistics from the General Department of Customs.

Items with the highest export turnover included wood and wooden-made products ($14.6 million), footwear ($13.8 million), cashew nuts ($12.3 million), seafood ($10.4 million) and clothing ($6.1 million).

The bilateral relations between the two countries have firmly developed over recent years with Viet Nam experiencing an average export growth of 20 per cent, the department said.

The improvement in trade ties has been made over the last two years of implementing the ASEAN-Australia-New Zealand Free Trade Agreement, said Chu Thang Trung, deputy director of the Asia-Pacific Market Department under the Ministry of Industry and Trade.

Trung said Vietnamese enterprises had many opportunities to export to New Zealand as the market has recovered quite well from the global economic slowdown. The trade pact opened up further opportunities for Vietnamese firms to export traditional as well as new products to the market, he said.

In order to foster exports to New Zealand, he suggest local enterprises learn all they can about buyers in that market. Doing so would help them save money and negotiate better deals.

Exporters of farm produce, seafood and processed food should pay attention to regulations on quarantine, packaging and weight of products in their target countries, he said.

Vietnamese businesses should contact reputable distributors in New Zealand so that they could have their products supplied to supermarkets and other outlets to increase their market share and compete better with products made from China, he said.

Truong Thi Binh from Duc Thanh Wood Processing Co, which exports wooden products to New Zealand, recommended that enterprises concentrate more on market research and design to sharpen their competitive edge.

Room to improve trade with India
India and Viet Nam have yet to exploit efficiently the vast business potential that exists between both countries although they have enjoyed a very close relationship since 1954, officials of both sides said at a seminar yesterday.

"The volume of bilateral trade and Indian investment in Viet Nam is still low though the latter is party to the India–ASEAN Free Trade Agreement which was signed in 2009," they said.

Less than one year after the agreement, India officially implemented the Free Trade Agreement with Viet Nam by slashing duties on hundreds of products, including seafood, chemicals, apparel and tyres.

The trade volume between India and ASEAN in 2011–12 was expected at US$70 billion, but the figure is $80 billion now. By 2015, the trade volume is expected to rise to $100 billion.

However, bilateral trade between Viet Nam and India reached only $3.9 billion last year. The two countries have set a target of boosting the figure to $7 billion by 2015.

Shri Tarun Gogoi, Chief Minister of the northeastern Indian state of Assam, said: "The two countries have set up an ambitious target of bilateral trade of $7 billion by 2015. I am confident that leaders of business communities from both sides will work together to not only achieve but also surpass the target."

During yesterday's business seminar on "Potential Opportunities for Boosting Indo–Viet Nam Trade Investment," Ranjit Rae, Indian Ambassador to Viet Nam, said, "though bilateral trade has been slow recently, it should soar to much higher levels in the future."

"Indian enterprises have invested $800 million into Viet Nam, which is not much because Indian firms are investing everywhere in the world," Rae said. He suggested that both sides look into reasons why they have a very good relationship but the number of investment projects is still limited.

According to HCM City's Department of Planning and Investment, the city received only 22 Indian invested projects out of a total of 381 foreign direct investment projects registered as of November this year.

A department representative said the city had better luck than other localities because it received most of the Indian invested projects in the country.

Le Phuoc Vu, Chairman of the Viet Nam – India Business Forum as also Chairman of the Hoa Sen Group, agreed that there was huge potential for business co-operation between the two countries.

"Viet Nam is highly populated. Labour cost is cheap and workers are clever. The two nations have a very good political relationship," he said, calling for more regular opportunities for enterprises of both countries to meet each other.

Le Trieu Dung, deputy head of the Multilateral Trade Policy Department, under the Ministry of Industry and Trade, said the trade volume between India and Viet Nam has not matched potential. "The rate of tariffs remains high on several types of commodities,"he said.

Pradipta K Mohapatra, leader of the Confederation of Indian Industry business delegation, invited Vietnamese enterprises to co-operate in crafting jewelry with precious stones, in which Indian enterprises have done well with Thai partners.

Viet Nam has invited Indian businessmen to invest in sectors such as healthcare, oil & gas, manufacturing and agro-industry, officials said at the seminar.

Customs calls for easier credit

The General Department of Customs proposed the Government continue creating advantageous conditions for enterprises to access credit sources as a measure to ensure budget estimates this year.

Export policies should be loosened and measures to stimulate investment and consumption and speed up inventory clearance should be implemented, which would help increase import-export turnover.

In order to remove difficulties for enterprises, the customs department also proposed the Government allow enterprises to pay taxes in instalments, ensuring the recovery of tax debts.

Even if they paid taxes in instalments, enterprises would still have to pay interest on late payments.

According to the department's statistics, customs revenue reached VND159.612 trillion (US$7.6 billion) in the first ten months of this year, equal to 71.3 per cent of the 2012 estimate.

Nearly 64.4 per cent of the figure was value added tax collection and the rest was from import and export, special consumption taxes and other sources.

The department estimated the collection of the 11-month period at VND178.612 trillion ($8.505 billion), 9.4 per cent lower than the same period last year.

The customs sector was assigned to collect VND223.900 trillion ($10.662 billion) for the State budget this year: 64 per cent from value added tax and the rest from import-export and special consumption taxes.

Marketers take aim at mobiles
Major enterprises such as Heineken, Ford Viet Nam, Tiger, Vespa, Vietinbank, HD Bank, Sanyo, Sony and Vietjet Air as well as smaller brands are pouring more money into mobile marketing for their advertising campaigns.

As the number of phone users increases, mobile marketing has become a way of improving companies' images and products to customers.

According to the General Statistics Office, the country has more than 120 million telephone subscribers, with more than 8.8 million mobile phone subscriptions.

Currently, about 36 per cent of adults access the internet through mobile phones and smartphones. People aged 15-24 account for 53 per cent.

Tran Thi Lan Thanh, managing director of Goldsun Focus Media Co, said that famous brands in the Vietnamese market were using mobile marketing more frequently.

In the first quarter of next year, the number of subscribers who accessed mobile advertising service Sosmart.vn is expected to reach 1 billion per month.

Sosmart.vn has linked with more than 500 million mobile subscribers per month.

Thanh said more businesses were pouring more money into advertising costs and efficiency based on a "pay-per-click" basis.

For instance, it costs only VND5,000 for a click-on ad banner or VND10,000 for 1,000 views.

Businesses would measure efficiency thanks to control and reports from Sosmart.vn, Thanh noted.

Ford Viet Nam has been successful in mobile marketing on launching the Ford Ranger.

Registration on test driving through mobile and SMS has been used. The campaign attracted more than 195,000 hits and 1,313 registrations after six weeks.

Experts noted that if marketers wanted to be successful with mobile marketing campaigns, they must make relevant ad content for target audiences.

Most mobile advertising takes the form of text messages.

Le Dinh Phuong, business director of VietGuys, which specialises in providing marketing services and solutions based on mobiles, was quoted in thegioibanle.vn as saying that Samsung and Sony Ericsson were using electronic warranty solutions for their mobile products.

When customers buy a product, all the information about time and warranty history will be fully stored on the system, allowing users to know their warranty information just by sending a message or calling up the operator instead of keeping a warranty card as they did before.

The cost of SMS marketing activities is not high, so it is suitable for small – and medium-sized businesses.

SMS marketing is an option worth considering if businesses or retailers use it for customer service or information channels.

To do this well, enterprises should pay attention to build databases of their customers, and carefully consider the content

Cement makers face hard times
Domestic cement consumption so far this year reached 42 million tonnes, declining 10 per cent over the same period last year, the Ministry of Construction said.

The Viet Nam National Coal and Mineral Industries Group (Vinacomin) had planned to sell 2.2 million tonnes of cement this year but had only sold about 1.85 million tonnes to date.

Vinacomin's Quan Trieu, Tan Quang and La Hien cement plants, which had a combined capacity of about 3 million tonnes, were able to sell about 80 per cent of their total capacity.

High inventories and losses during the year caused enterprises to hesitate over business plans for next year, with many waited for the real estate market to revive, the ministry said.

Viet Bac Mine Industry Corp general director Bui Tran Dong told Dau tu (Vietnam Investment Review) that prospects for next year didn't look better.

Hoang Manh Truong, chairman of Vissai, in the northern province of Ninh Binh, said the company expected to sell over 5 million tonnes of cement this year, including exports.

"Next year, sticking to export markets and major property projects, we predict our cement sales will increase only 5 per cent," he said.

"In 2013, if the Government doesn't put policies in place to solve difficulties in the property market, the cement industry will witness a series of firms going bankrupt," Dong said.

"It will be even harder for Vinacomin to avoid financial difficulties."

Overseas remittances to hit US$11 bil this year

Overseas remittances to Vietnam are likely to reach around US$10-11 billion in 2012, according to the National Financial Supervisory Committee.    

This is a positive sign in the context of global economic downturn, say committee experts attributing the country’s steady economic growth to stable inflows of overseas remittances and FDI capital.

They quoted statistics as saying FDI disbursement reached US$10 billion during the past 11 months and is forecast to amount to US$11 billion this year.

A recent World Bank (WB) report has unveiled that overseas remittances to Vietnam this year would be US$9 billion, ranking seventh among the nations receiving the largest amount of money remitted from overseas.

WB said developing countries will receive a total of US$406 billion in overseas remittance this year, up 6.5 percent against last year. India takes lead the list with US$70 billion, followed by China (US$66 billion), the Philippines and Mexico (US$24 billion) and Nigeria (US$21 billion).

The WB’s Lead Economist for Vietnam, Deepak Mishra, said that Vietnam’s overseas remittance reserves are rather small compared to other nations. In addition, the convenient transfer from VND to the US dollar in Vietnam has also affected the country’s money supply in the inter-bank market.

Currently, Vietnam has around 4 million Vietnamese expatriates living and working in 101 nations including 400,000 guest workers.

Eight renewable energy projects get funding

Eight renewable energy projects have received financial assistance in the first period of the Energy and Environment Partnership with the Mekong Region (EEP Mekong) programme, according to the Ministry of Industry and Trade.    

The core activities of the programme include financial assistance for projects, new initiatives, and solutions to facilitate renewable energy development.

EEP Mekong is committed to providing EUR9 million over the 2013-2016 period to renewable energy projects, creating favorable conditions for investors to access technological information and financial assistance.

EEP also helps Vietnamese management agencies develop renewable energy mechanisms and polices.

US$709 million trade surplus with Italy

Vietnam earned US$1,511 million from exports to the Italian market in the first ten months of 2012, up 24.2 percent from the same period last year.  

According to the General Department of Vietnam Customs, the country’s total export earnings from Italy will reach US$1,815 million by the end of this year, bringing the two-day trade turnover to US$2,775 million.

Vietnam’s 10-month imports from the Italian market were estimated at US$802 million, down 3.2 percent over the same period last year. As a result, Vietnam achieved a trade surplus of US$709 million with Italy.

Vietnam’s key export items included telephones and components, coffee, footwear, seafood, machinery and spare parts, and garment and textile products. The country imported equipment, feed for animals, and pharmaceutical products from Italy.

Argentina-Vietnam trade increases sharply

Trade between Argentina and Vietnam is growing robustly, according to new statistics from the Vietnam General Department of Customs.   

It reported that in the first ten months of 2012, two-way trade turnover reached US$875 million, a year-on-year increase of 14.7 percent.

The figure includes Vietnamese exports to Argentina worth US$136 million, up 9.9 percent against the same period last year, and imports of US$739 million, up 15.7 percent.

Vietnam exports computers, footwear, electronic equipment and components to Argentina, while importing raw materials, garment accessories, animal feed, animal fat and vegetable oil.

In 2011, Argentina ranked 29th among Vietnam’s foreign traders but has since moved up to 27th this year.

Cambodia facilitates Vietnamese business operations

The Cambodian Government will ease difficulties, creating favourable conditions for Vietnamese businesses, including rubber producers, to operate efficiently in the country.

Deputy Prime Minister Yim Chhayly made the commitment at a meeting with representatives of rubber companies operating in Cambodia.

He confirmed that his government will remove any obstacles facing the businesses and do its utmost to protect their legitimate rights in the country.

He appreciated the Vietnamese companies for having developed rubber plantation projects in Cambodia, helping foster local economy and reduce poverty in the community.

They have built schools, medical stations, pagodas, water and electricity supply systems, and roads in the areas where the projects were undertaken.

Vietnamese companies have deployed training programmes and created steady jobs for tens of thousands of local workers, he stressed.

To date Vietnamese businesses have planted rubber trees on 81,000 hectares of land, of which 70,000ha came from the Vietnam Rubber Industry Group.

Next year, the Vietnam Rubber Corporation plans to reclaim an additional 30,000ha of land and plant the tree on 25,000ha.

Vietnamese businesses aim to complete the ongoing 100,000 ha rubber plantation plan in 2014, one year ahead of schedule.