Sand prices see sharp increase     

Sand prices have soared over the past few days, following the Government’s order to tighten supervision of sand mining, though speculation is more likely to be blamed for the price jump.

Do Thanh Nguyen, owner of a construction materials supply agent in Nam Dinh City, told Nguoi Lao Dong (The Labourer) newspaper that for one week, sand wholesalers had raised prices by 1.5-2 times and are delivering only half the earlier volumes of sand.

According to the wholesalers, the cause of the price hike is that supervision of sand mining has been tightened just as the construction season began.

In Ha Noi, sand prices have also jumped over the past few days. The owner of a building material company in the city said that sand prices now ranged between VND120,000-200,000 (US$5.3-8.8) per cu.m, compared to the previous VND80,000-180,000 per cu.m.

He predicted sand prices would continue to rise, saying that sand mining in the northern provinces of Bac Ninh and Bac Giang had been suspended until inspections had been completed, which has sharply reduced supplies.

Further, the owner of a construction contractor in Ha Noi’s Cau Giay District said that the prices of sand had skyrocketed, causing his business great risks, since it had signed a construction contract before the price hike.

According to the Ministry of Construction’s Department of Construction Materials, the legal sites for mining sand could only meet 60-65 per cent of the needs of large cities. Meanwhile, the nationwide demand for sand has increased sharply, from 92 million cu.m in 2015 to 130 million cu.m by 2020.

Because large amounts of sand come from unlicensed sources, the restrictions on sand mining had reduced the supply of sand, pushing up prices, the department explained.

However, Pham Sy Liem, former minister of construction, said that the shortage in sand was not serious enough to have caused the price hike. The situation was likely due to speculation, he said, adding that authorities needed to clarify why prices saw such large increases.

Nguyen Ngoc Thanh, head of the Construction Materials Division under the HCM City Department of Construction, said that rising sand prices were due to a divergence between supply and demand.

To help people and businesses keep track of prices, the department regularly updates and posts price tables from many construction material suppliers for their reference.

Regarding the question of whether Government supervision has caused sand prices to jump, Thanh said that there was no evidence to support this, since it was difficult to determine the amounts of legal and illegal sand supplies.

Deputy head of Ha Noi’s National Assembly delegation Ngo Duy Hieu said that there should be a mechanism to organise sand-mining bids to legitimate enterprises to prevent sand smuggling, which ultimately would help stabilise the market.

3-bedroom condos scarce in HCM City, to become hot cakes     

Demand for three bedroom condominiums is set to surge in HCM City thanks to the convenience and the high profits they offer, experts have predicted.

A report said that since 2014 developers have brought 110,000 condos into the city property market, some 30 per cent of them with three bedrooms ranging in size from 80sq.m to 100sq.m.

Another 60 per cent are two-bedroom condos measuring around 65sq.m, and the rest are one-bedroom units and others.

According to experts, for a condo with three bedrooms, 100sq.m is the ideal size suitable for a sustainable development trend of Vietnamese families in which they live with their grandparents or baby-sitters.

But it is notable that many developers have reduced the size of three-bedroom condos to around just 80sq.m. The number of condos with three bedrooms and measuring around 100sq.m is limited.

As the size reduces, so does convenience because then the size of each room is very small.

Crystal-gazing experts said the market would soon face a shortage of three-bedroom condos measuring around 100sq.m.

They said those developers building such condos are the intelligent ones because their prices are sure to jump in future due to the dwindling supply.

Saigon South Residences is a clear example of the high demand for three-bedroom condos.

Sold since October last year, the project, the first that Phu My Hung Development Corporation developed outside its Phu My Hung City Centre, has attracted plenty of buying interest.

After four successful phases of sales of its Saigon South Residences, with the rate of purchase being nearly 90~98 per cent in each, Phu My Hung Development Corporation has announced that the last phase will be on April 22 and they will sell units in Block D.

Over four sales phases, nearly 1,500 units have been sold, more than a third of them being three-bedroom condos measuring from 94sq.m to 104sq.m.

The developer said demand for such condos has not been any less than for two-bedroom units.

With three bedrooms, these condos are the best choice for families who live with their parents or have more than one child and babysitters living with them, Phu My Hung said, adding that with these condos, there will be no need for them to change to other accommodation when their family has additional members.

Buying three-bedroom condos is a smart choice, experts said, explaining that their supply in the market is not high. And the supply is even less in projects with full service like Saigon South Residences.

Block D is the last building in the project, with two beautiful views to the north-east and south-west. The north-east view is of the river and Phu My Hung City Centre. The south-west is looking over the amenities site of the project

The building has 321 condos. Of them, 30 per cent are three-bedroom condos measuring 94-104sq.m. It has a yoga room and playing room for children.

Saigon South Residences has been designed by Sino Pacific Construction Company. It has 6 buildings with 19 to 29 floors, including 1,840 condos and 32 per cent of them are three-bedroom condos

The project, covering an area of nearly 33,000sq.m, has earmarked 69 per cent of the land for greenery and amenities.

This is the first project that Phu My Hung has developed with 69 amenities and services.

More importantly, security is ensured throughout the day with a camera system working 24/7.

After four selling phases, many customers cared about the project. They said that they like the way that the developer announces information. It is clear and transparent.

All information about the project including prices and buying application form are published. Furthermore, customers have also been informed about parking lots.

Saigon South Residences is expected to bring high profits to investors since it is located in a place where infrastructure is undergoing tremendous development.

By 2019, when the construction of Saigon South Residences is complete, many transport infrastructure works will also be completed, like a flyover on Nguyen Huu Tho and Nguyen Van Linh streets; widening of many roads like Nguyen Huu Tho, Le Van Luong, and Huynh Tan Phat; and six bridges, namely Nguyen Khoai, Rach Dia 1, Thu Thiem 4, Thu Thiem 3, Phuoc Khanh, and Binh Khanh.

Growth slows on mixed performance of large-cap stocks     

Shares edged up on Tuesday morning, but the mixed performance of large-cap stocks restrained market growth.

The benchmark VN Index on the HCM Stock Exchange inched up 0.2 per cent to 731.1 points.

On the smaller Ha Noi Stock Exchange, the HNX Index rose 0.6 per cent to end at 90.9 points.

A total of 157 million shares worth a combined VND2.5 trillion (US$110 million) were traded in the two markets.

Financial companies lost value in the morning, with the big losers being BIDV (BID), Vietinbank (CTG), Masan Group (MSN), Saigon Securities Inc (SSI) and Sacombank (STB).

At the other end of the spectrum, several large-cap stocks such as Vinamilk (VNM), Kido Group (KDC), PV Gas (GAS), PetroVietnam Drilling and Wells Service (PVD), Hau Giang Pharmaceutical (DHG), FPT Corp and Hoa Sen Goup (HSG) buoyed up the market.

The shares of budget airline Vietjet (VJC) advanced 0.8 per cent to VND131,800 a share, following the company’s proposal to hike its foreign ownership limit to 49 per cent, and pay a 31.6 per cent cash dividend for 2016’s earnings and an estimated 30 per cent dividend for 2017. The carrier will seek its stockholders’ approval at the annual shareholders’ meeting, which is scheduled on April 20.

The afternoon session starts at 1pm. 

Exhibition honors farmers, promotes agricultural products

An exhibition on urban agriculture and Southeastern region's economic trade opened at Le Van Tam Park in Ho Chi Minh City’s District 1 on April 10.

The event features around 300 display booths, including 150 stalls presenting high-tech agricultural products of farmer unions of provinces and cities, traditional craft villages nationwide, such as Ho Chi Minh City, Dong Nai, Ba Ria-Vung Tau, Tay Ninh, Long An, Tien Giang, Ben Tre, Lam Dong, Gia Lai, Binh Dinh and Quang Binh.

The display also honors outstanding farmers for their significant achievements in the integration period and promotes their agricultural products.

The event runs until April 16.

HCMC: Private sector to contribute 65% to GRDP

HCMC is looking to have at least half a million enterprises by 2020, of which major firms and those in the private sector will contribute about 65% to the city’s gross regional domestic product (GRDP) and 64% to the city’s total investments by then.

The city said in a report delivered at a meeting on Wednesday that it was planning to have 60,000 new enterprises this year and increase the number of enterprises citywide to 500,000 by 2020.

Data shows local private and foreign-invested enterprises (FIEs) far outdid SOEs in 2005-2014 in terms of contribution to the city’s GRDP. The gap of GRDP contribution between the state and private corporate sectors has steadily widened.

In 2005, when the GRDP of the city was VND165 trillion, nearly VND58 trillion of it came from SOEs while private enterprises contributed VND43.3 trillion and FIEs VND36 trillion.

In 2014, HCMC’s total GRDP stood at VND852 trillion, with VND202 trillion of it sourced from the foreign-invested sector and VND422 trillion from the domestic private sector.

In 2011-2015, investments by non-state enterprises accounted for some 61% of the total, while SOEs and FIEs represented 21% and 18% respectively, according to data from the HCMC Institute for Development Studies.

To achieve the target of having 60,000 startups this year, the city government has pledged to carry out administrative reforms to make life easier for businesses, said a source from the HCMC Department of Planning and Investment.

City and district authorities will organize regular public dialogues, at least twice a year, between their leaders and the business community.

City agencies will have to abolish about 30% of their meetings to have more time to visit enterprises and listen to their recommendations. Administrative costs should be brought down to ease the business cost burden.

Tran Thi Binh Minh, deputy director of the Department of Planning and Investment, said that to household businesses to upgrade themselves to companies, the city will consider shortening the time required for issuance of a business registration certificate to a single day.

Household businesses will not have to pay any fees for registration of conversion into companies and all costs arising from their tax code registrations will be exempted in the first year. In addition, their staff will be offered training courses to improve their knowledge of startups and accounting while low-interest loans will be made available for them.

HCMC will help all converted enterprises to find outlets for their products on the domestic market, with priority given to small and medium businesses that set up shop in export processing zones and industrial parks in the city, said Minh.

HCMC vice chairman Le Thanh Liem said there were now 302,000 firms active in the city.

Management model of Phu Quoc special zone unveiled

The government model of Phu Quoc special administrative and economic zone would be built based mainly on merging agencies under the Party committee and the People’s Committee of the island district off mainland Kien Giang Province. 

Pham Vu Hong, chairman of Kien Giang Province, reported developments of the scheme to develop Phu Quoc into a special administrative and economic zone to Permanent Deputy Prime Minister Truong Hoa Binh at a working session in the province last Saturday.

Military, security, prosecution, court, customs, State treasury, tax and social insurance agencies in the island district of the Mekong Delta province would be re-organized in accordance with the planned administration model.

The Phu Quoc special administrative economic zone is envisaged operating on a one-level urban government model, and the current communes and town would be transformed into sub-zones. On top of that, the model does not include a People’s Council in the special administrative and economic zone. 

The development scheme has been worked out in more than eight years based on instructions and documents of the Politburo, the Government, ministries, agencies and the authority of Kien Giang, including Announcement No. 21-TB/TW dated March 22, 2017 conveying the Politburo’s conclusion on development schemes for special administrative and economic zones. 

Hong said Kien Giang Province would develop the Phu Quoc special administrative economic zone on the market principle and an economic growth model with a high level of openness backed by breakthrough policy incentives and less State intervention.

The recreational, tourism, resort and financial-banking service sectors and a sea-based economy are expected to play as key drivers for the long-conceived zone. Phu Quoc will be supported to become a major tourism and service hub in not only Vietnam but also Southeast Asia.

Hong said Kien Giang Province will set up a provincial-level steering committee headed by the secretary of the province’s Party Committee to guide on the building of an operation model for the Phu Quoc special administrative economic zone. 

Relevant agencies will prepare proper institutions and build an e-government and a public administrative service center; mobilize finances (an estimated US$40 billion) until 2030 to fund the zone’s development; develop high-quality human resources; boost research, application and transfer of scientific and technological advances; and work out tax incentives and policies to attract talent.

Efforts will also focus on policy incentives for the real estate sector; immigration and residence of foreigners and overseas Vietnamese, as well as measures to ensure defense and security.

Deputy PM Truong Hoa Binh underlined the importance of having a well-functioning government apparatus to effectively govern and map out institutions and policies for administration, investment and trade in line with Vietnam’s law and international standards to enable the Phu Quoc special administrative economic zone to attract investors and compete with similar zones in the region. The institutions and policies must be consistent in the long term.

Binh called for the agency in charge of drafting the law on special administrative and economic zones to attend to the specific characteristics of each zone and weigh breakthrough socio-economic policies in compliance with Vietnam’s law for the zones to compete regionally and globally.  

Binh urged the island district to adopt incentives to speed up infrastructure development and human resource development, and attract investors and high-quality laborers, and streamline administrative procedures. The island should make the most of its advantages to accelerate growth. 

Besides infrastructure development, Binh also requested relevant agencies consider applying breakthrough policies for the tax, customs, financial and banking sectors to make it easy for the Phu Quoc special administrative economic zone to lure investors and skilled laborers. It is crucial to establish a competent judicial agency able to deal with economic and trade disputes as well as crimes related to technology and intellectual property rights.  

More working sessions and comprehensive assessments based on international experiences, zoning and attraction of strategic investors are needed to improve the draft law on special administrative and economic zones before it goes before the National Assembly so that it, once passed, will drive the growth of the zones.  

The Government proposed the legislature add the draft law to its law making program for 2017.

HCMC supports VietinBank to pilot non-cash payment

The HCMC Department of Information and Communications has announced it would cooperate with Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) to connect the public administrative system of the city with the payment system of VietinBank to allow people to pay public administration fees online.

The online payment of public fees and charges will be initially carried out at the city’s Department of Health, Department of Planning and Investment, Department of Natural Resources and Environment, Department of Education and Training, Department of Customs and Department of Taxation. Later, this method will be applied at other units such as SatraMart and Co.opmart stores and wholesale markets Binh Dien, Thu Duc and Hoc Mon.

The non-cash payment measure of HCMC goes in line with Decision No. 2454 /QD-TTg issued on December 30, 2016 by the Prime Minister to promote non-cash payments in Vietnam in 2016-2020.

The plan is aimed at boosting e-payments as Vietnam is still a cash dominant economy. Changing people’s habit of using cash for paying for goods and services will reduce costs associated with cash payments. The proportion of cash in total payments is expected to dip to less than 10% in 2020.

A survey by the E-commerce and Information Technology Agency under the Ministry of Industry and Trade shows that the percentage of online shoppers is still low while cash payments account for 64% of total transactions. Currently, few people choose to pay online using international credit cards such as Visa, MasterCard, JCB and AMEX, debit cards or e-wallets.

Law on special administrative-economic units in progress

Deputy Prime Minister Truong Hoa Binh has asked the Ministry of Planning and Investment to coordinate with relevant agencies and the provincial governments of Quang Ninh, Khanh Hoa and Kien Giang to quickly draw up the Law on Special Administrative-Economic Units.

Van Don (Quang Ninh), North Van Phong (Khanh Hoa) and Phu Quoc (Kien Giang) will become special administrative-economic units when the draft law is passed by the National Assembly (NA), according to the Government Office.

The deputy prime minister wants the law to take into account the characteristics of each unit. The contents, mechanisms and policies on socio-economic incentives must be prescribed in the law, with competition with against the region and the world ensured.

The governments of Quang Ninh, Khanh Hoa and Kien Giang should take the initiative in conceiving master plans and projects for investment and development, focusing on the major sectors in line with the trend of the world, the capacity, comparative advantages and practical conditions of each locality.

The Ministry of Defense and the Ministry of Public Security should coordinate with agencies and localities concerned in formulating schemes for national defense and security as well as social order and safety in special administrative-economic units.

The Ministry of Planning and Investment together with other relevant agencies should heed opinions of the Politburo and finalize the related documents for submission to the NA for the NA deputies to contribute their ideas.

Recently, the planning ministry has published this draft law for comment.

This move of the Government came after the Politburo issued Notice 21-TB/TW on the proposals for the development of the three special economic-administrative units on March 22.

The notice affirms that the development of the aforesaid units is a major policy of the Party. Therefore, it is necessary to resolutely implement it, step by step in a firm manner, with experience drawn in the process.

The notice states that the establishment of these special economic-administrative units under the provincial government has been approved, with an aim of making the best use of the regional potentials with outstanding advantages. Special administrative-economic units are magnet for investment, high technology and advanced management mode for the formation of a high growth area that generates more resources and motivation, accelerating the development and economic restructuring of the province, the region and the country.

The organizational structure and model of such units shall be prescribed by the Law on Special Administrative-Economic Units.

Q1 G-bond sale plan 87% complete

The State Treasury of Vietnam issued VND56.5 trillion of G-bonds in the first three months of the year, meeting 87% of the plan for the first quarter.

The two best-selling types of debt were those with five and seven-year tenors, with total respective sales of VND13.55 trillion and VND12.6 trillion, but they were below expectations for the quarter. Meanwhile, bonds of 15 years or longer were greatly sought after but their volumes were small.

This indicates G-bond sales on the primary market were lower than in 2016. Financial institutions, insurance companies and banks are eyeing long-term bonds given their high coupons.

Interest rates for Vietnamese dong on the interbank market hovered around 5% a year for terms of less than a month, a mild increase driven by the start of a new round of setting aside cash for compulsory reserves, plus the pressure from debts falling due on open market operations (OMO). This led to a minor decline in liquidity on the primary monetary market.

Although the State Treasury recently offered higher interest rates for five-year bonds, sales remained poor due to the interest rate difference between the secondary and primary markets.

At a G-bond auction last Wednesday, the State Treasury offered VND5 trillion of bonds with four tenors: five years with VND1 trillion, seven years with VND1 trillion, 10 years with VND1.5 trillion and 30 years with VND1.5 trillion.

Financial institutions bought VND550 billion of five-year debt, VND550 billion of seven-year debt, VND1.95 trillion of 10-year debt and VND1.95 trillion of 30-year debt. The respective coupons were 5.12%, 5.43%, 5.99% and 7.85% a year, five basis points lower than those at the March 29 auction.

Overall, the State Treasury of Vietnam has in the year to date issued around VND61.5 trillion of debt. On the secondary bond market, foreigners remained net buyers. Since the beginning of the year, foreigners have net bought about VND11.92 trillion of G-bonds.

Bond coupons on the secondary market tend to inch up for terms of two, three, five and seven years, reaching 4.792%, 4.982%, 5.216% and 5.56% respectively.

Meanwhile, the annual rates for bonds with one-year, 10-year and 15-year terms have fallen by 3.4-9.8 basis points to 4.14%, 6.11% and 6.96% respectively.

4IR poses network security risk to Vietnam

The Fourth Industrial Revolution (4IR) is expected to create great opportunities for Vietnam, but it will also pose network security risks, heard a security conference in Hanoi early this week.

Deputy Minister of Public Security Bui Van Nam, speaking at the conference held by the Ministry of Public Security’s Department of Network Security and Department of Information Safety, and International Data Group (IDG Vietnam), said the 4IR would help Vietnam take advantage of information technology (IT), automate business processes, enhance connectivity and access big data.

Nam, however, said this revolution would also expose Vietnam to risks of network and information security breaches.

Nam described the recent hacker attacks in the banking, telecom and aviation sectors as serious, saying hacking and terrorism have become a pressing security issue for all countries.

Data of the Vietnam Computer Emergency Response Center shows more than 134,000 cyber attacks occurred in Vietnam in 2016, a fourfold rise against 2015.

Meanwhile, large numbers of users are still unaware of this danger. “All citizens and organizations need to be aware of information security, find effective security solutions and work closely with network security experts to protect themselves from cyber attacks,” Nam said.

Conversion into firms tough for household businesses

Household businesses in HCMC are still grappling with a number of barriers when they are turned into companies despite the city government’s support for their conversion, surveys have found.

HCMC’s target is to have at least 500,000 businesses active by 2020, with major companies and those of the private sector expected to contribute 65% to gross domestic product (GDP) and 64% to the city’s total development investment.

However, household businesses are coping with challenges regarding applications for new business registration certificates, labor recruitment and investment in new technology.

A report of the HCMC Tax Department indicated there are more than 36,472 household businesses that can be upgraded to firms. The city expects 21,000 of them can become companies this year as they have clear addresses, stable operations and high revenues.

They are divided into two groups. The first group comprises those having annual revenue of more than VND1.2 billion (US$52,884) each and located in districts 1, 2, 7, 10 and Binh Thanh, while the second group consists of households with annual sales of VND600 million or higher.

Household businesses, once turned into firms, will have more opportunities to expand operations and promote brands, gain easier access to preferential bank loans, carry forward losses to the following years, and get other benefits.

However, the surveys showed local household businesses will have to deal with some challenges in the conversion process.

A survey of 1,000 household businesses with annual revenue of at least VND2 billion in District 1 found 420 of them pay taxes of over VND100 million a year each, and many operate in the food and beverage, trading and services sectors. But multiple households in the central business district hesitate to operate as firms for fear of complicated procedures.

Many household businesses must apply for licenses in conditional sectors as well as food safety, star rating and security certificates if they want to become firms.

In District 12, there are more than 16,800 household businesses active in the garment, food portion, grocery, electrical and electronic products, processed food, handicraft, interior decoration and building material sectors. However, many of them mainly sell products to consumers in the outlying district and have not been ready to operate as firms.

On top of that, a large number of household businesses are not financially strong and use unskilled workers and outdated machines.

Minister says no floor airfare for domestic flights

Minister of Transport Truong Quang Nghia has confirmed the ministry will not impose a floor airfare on domestic flights as a measure to regulate prices of air transport services for economy-class passengers on domestic flights and the local aviation market.

Nghia’s confirmation came at a working session of the Party committee of the ministry last Friday, days after Vietnam Airlines and its low-cost affiliate Jetstar Pacific proposed applying the floor economy-class airfare to domestic flights.

Nghia was quoted by a report posted on the ministry’s portal as saying that the ministry never puts the interests of airlines or enterprises above those of the people. It is important to adopt a proper mechanism to support fair competition, profitability and service quality of firms, and all enterprises should compete on an equal footing and in line with law. 

Nghia said the ministry will not change the prevailing regulations on air-ticket prices and will strengthen State management of flight operations.

He affirmed airlines are allowed to lower airfares as much as they could and that relevant agencies should check whether or not they sell promotional airfares in line with the current regulations.   

Nghia called for an improvement of State management of the aviation market, which has grown strongly over the years.

Earlier, Vietnam Airlines and Jetstar Pacific suggested the Civil Aviation Authority of Vietnam (CAAV) weigh the floor economy-class airfare on domestic routes. They said an air ticket price cut race has made inroads into their business efficiency and sustainable development of the local aviation market.

However, Vietjet argued that no floor fare should be imposed in any form as this would run counter to the Competition Law and international practices. The no-frills carrier said the floor airfare would eliminate competition among airlines to cut prices, thus limiting opportunities for people to travel by air.

Experts and consumers objected to any plan to apply the lowest economy-class airfare to domestic services as it would put a dampener on airlines’ efforts to improve service quality and take away discount air-tickets from millions of people.

Dragon Capital partners with Ruby Hill to tap microfinance in Myanmar

Vietnam’s Dragon Capital Group has inked a deal with Myanmar’s Ruby Hill Financial Company, a member of Loi Hein Group, to set up Ruby Hill Microfinance, a microfinance institution based in Yangon, Myanmar.

With initial capital of US$5 million, the joint venture will provide financial services for the burgeoning workforce that is driving Myanmar’s rapid economic development, said Sai Sam Htun, chairman of Loi Hein Group at the signing ceremony in HCMC last week.

Ruby Hill holds a majority stake of 51% in the new institution while its Vietnamese partner owns the remainder.

In 2013, more than half of Myanmar’s population had no access to financial services, and 30% used unregulated services. An estimated US$1 billion in financial needs had not been met, according to the United Nations Capital Development Fund.

Dominic Scriven, chairman of Dragon Capital, said the joint venture with the Myanmar partner is not a move for the company to leave the Vietnamese market. Dragon Capital has plans to join an enterprise to provide services for the Vietnamese insurance sector.

Loi Hein is a leader in the fast moving consumer goods market in Myanmar, with its main products like Alpine water and a wide range of carbonated soft drinks available at over 45,000 outlets.

Q1 credit grows sharply

Unlike in previous years, credit had risen to a record high of 3.14% in the year to March 23 compared to end-2016, up from 1.79% in the same period last year, according to the central bank.

The State Bank of Vietnam (SBV) said on April 5 that first-quarter credit went mainly to production and business activities, with outstanding loans making up about 80% of the total in the banking system.

By March 23, money supply had increased by 3.36% and capital raising by the banking sector had picked up 3.07 % against the end of 2016. Liquidity at banks was guaranteed and interbank operations went well.

At present, the interest rates for deposits of six months or shorter range from 4.8% to 5.4% per year. For savings with tenors from six months to less than 12 months, the rates are 5.6-6.7% while those with a term of over 12 months are 6.7-7.4%.

Lending rates now range from 6% to 9% for short tenors and from 9% to 11% for medium and long terms. For good clients, short-term loan interest rates are 4-5%.

As for the restructuring of banks and the settlement of bad debt, the central bank said solving the bad debt issue continued to be a priority in the first months of 2017. Bad debt accounted for less than 3% of total outstanding loans in the system.

Concerning the VND100 trillion credit package for high-tech agriculture at the request of the Government, the central bank said it would issue a decision telling banks to make loans available from April 2017 with annual interest rates that are 0.5 to 1.5 percentage points lower than normal levels.

This credit program does not enjoy any subsidy from the Government. It favors those having sound projects and business plans, and getting involved in high-tech agriculture and clean industry.

The Government has asked the Ministry of Natural Resources and Environment and the Ministry of Justice to finalize guidelines for the issuance of certificates of ownership of assets on agricultural land so that those assets can be used as collateral for bank loans.

Govt okays funding plan for north-south expressway

The Government has approved a plan to use VND55 trillion from the proceeds of G-bond sales in 2016-2020 to partly fund the north-south expressway project.

The funding will cover site clearance for the project, according to a statement issued by the Government Office to announce Prime Minister Nguyen Xuan Phuc’s conclusion on the project.

In addition to the State budget, the big-ticket project would rely on loans from domestic commercial banks, government-guaranteed loans from the Asian Infrastructure Investment Bank (AIIB) and proceeds from construction bond sales.

The Government also agreed no-bid contracts could be awarded to consulting firms as proposed by the Ministry of Transport. Meanwhile, investors of the project would be picked through tenders and based on the approved technical design of the project.

Site clearance will be done for the entire expressway rather than section by section. The ministry can map out the pre-feasibility study for the project for submission to the Prime Minister for consideration and approval. 

The ministry is assigned to consider developing the trans-Vietnam expressway with 6-10 lanes when reviewing the master zoning plan for expressway development until 2020 with a vision toward 2030.

In March this year, the ministry sent the Government a development scheme for 1,372 kilometers of the north-south expressway at a total cost of an estimated VND314.1 trillion (around US$13.84 billion).

Local firm to develop river bus routes in HCMC

The HCMC government has given the green light to local firm Daily Co Ltd to develop river bus routes as a measure to cope with growing road traffic congestion in the city.

Municipal authorities have asked the company to prepare for the launch of the first river bus service in the city in June, and offer reasonable fares to encourage commuters to use the new service.

The city government said in a statement early this week that the forthcoming river bus service could contribute to easing road traffic congestion.

The company will build river bus routes under the build-operate-own format. The first service will connect Bach Dang Wharf in District 1 and Hiep Binh Chanh Ward in Thu Duc District.

The city has asked the firm to make minor wharf renovations and repairs to keep the landscape in the area intact. Since the wharf area is the converging point of waterways, roads and public transit routes, the company should have traffic jam prevention solutions.

The company has also secured approval to develop three other wharfs, with one in Thu Thiem New Urban Area, one in Thu Duc District’s Truong Tho Ward, and one in Tan Cang Tourist Area.

The company is also weighing two other routes linking Bach Dang Wharf with Mui Den Do and Phu My Hung areas, both in District 7.

The company will operate 10 boats with each able to carry 60 passengers on the 11-kilometer route between Bach Dang Wharf and Hiep Binh Chanh. It will take around 30 minutes to travel the entire route.

The company will conduct two trips a day to transport an estimated 5,000 passengers. Tickets cost VND15,000 per ride.

Tra fish shipments to Spain decline steeply

Vietnam’s export of tra fish (pangasius) to Spain has fallen sharply since Carrefour, Europe’s largest retailer, stopped distributing the fish early this year.

Revenue from tra fish exports to Spain in February plunged a staggering 46.7% year-on-year, according to a report of the Vietnam Association of Seafood Exporters and Producers (VASEP).

In the first two months of this year, tra fish shipments to the European nation plummeted 19.9% year-on-year to around US$6.1 million.

Tra exports to this market amounted to US$121.8 million in 2008 and US$122 million in 2009, meaning the monthly average export revenue reached over US$10 million.

VASEP said the situation had been aggravated by the growing competition between Vietnamese pangasius and white-flesh fish of some European countries like France and Spain since 2009. The European media has reported inaccurately on the Vietnamese tra fish sector, claiming that there is high risk of food hygiene and fish farms are polluted. In January a Spanish TV station aired video footage containing wrong information about Vietnam’s pangasius farming industry but it led Carrefour to cease distributing Vietnam’s tra fish in Spain and elsewhere in Europe.

VASEP General Secretary Truong Dinh Hoe then told the Daily that export sales of Vietnamese tra fish might take a hit. Recent data shows that has become true.

In the year to mid-February, tra exports to the European Union (EU) fell 17.6% to US$25.2 million compared to the same period last year, according to the Vietnam Pangasius Association.

Carrefour’s decision to stop importing the fish from Vietnam is one of the reasons, said Vo Hung Dung, vice president and general secretary of the association. Local enterprises have no other choice but to guarantee high quality to win back EU consumers.