Zing pulls down shopping site

Vinagame company has closed its on-line shopping website Zing Deal after two months of operation - despite the apparent success of the operation.

It said this is because it wants to further develop other e-commerce activities. After two months of operation, the website claims to have sold more than 10,000 on-line coupons that helped buyers save VND1.4 billion (US$67,000) on a wide range of goods.

Bao Anh, an IT expert from Vinagame, declined to comment on the issue apart from saying the closure could lead to new development strategy.

Launched in November, 2010, Zing Deal was an e-commerce website operating on the "Groupon model" (group coupon). In a deal-of-the-day, it featured discounted gift certificates usable at local or national companies.

Backed by a solid financial foundation, experienced technical team and powerful database with great support from users in the social networks such as Zing Me and News Zing owned by Vinagame, the Zing Deal looked initially very promising.

According to an industry insider, Vinagame did not pay enough attention to developing the website.

Vinagames experience in on-line service was apparently not sufficient to run a group purchasing service based on on-line sales rather than technology services. One insider said that even Facebook, the world's most popular social networking site, and Google, had also failed to make a success of similar operations.

Many experts said that the group purchasing model had great potential, but difficult economic times would make it difficult for the 100 or so operating in Viet Nam to succeed.

Truong Si Anh, a market researcher from Kantar Media, said the information about goods and services on Groupon websites was sometimes too vague. If purchases were not guaranteed by website owners, the schemes could quickly unwind.

Many Groupon websites are still active, but many smaller ones have closed without announcement.

This is sometimes linked with the risk of finding that goods received do not match the claims made on-line. Some sites have also been accused of deliberately cheating customers.

Gold closes week lower due to uncertainty in Greece  

Price of gold in Vietnam declined for three consecutive days to around VND44.75 million a tael (1.2 ounces) on February 11 as global price fell due to stagnant Greek bailout talks.  
 
Sacombank Jewellery Company bought gold at VND44.35 million and sold at VND44.75 million as of 8 am Vietnamese time.

Saigon Jewellery Company, Vietnam’s biggest gold processor and trader, collected the metal at VND44.53 million and sold at VND44.83 million as of 8 am Vietnamese time.

Hanoi-based Phu Quy Jewellery Company purchased SJC-brand gold at VND44.65 million and sold at VND44.8 million as of 9.12 am Vietnamese time.

Meanwhile, Bao Tin Minh Chau Jewellery Company quoted price at VND43.75 million for buying, and VND44.05 million for selling at 9.33 am Vietnamese time.

Domestically, gold fetched around VND1.5 million a tael, higher than global price.

Internationally, gold dropped as uncertainty over negotiations for a rescue package for Greece prompted investors to sell gold and hoard cash.

Gold futures for April delivery fell as much as $15.9 an ounce, or 0.9 per cent, to close at $1,725.3 an ounce on the Comex in New York. Trading volume reached the highest level in a week.

Immediate-delivery gold lost 0.6 per cent to close at $1,722.1 an ounce, posting a second straight weekly loss.

Doubt on the possibility that Greece would avoid default increased after European financial ministers asked Greek policy makers to pass the latest austerity package into law before releasing the 130-billion-euro rescue package. The European Union expected the Greek government to specify a further 325 million euros ($430 million) of spending cuts before it agrees to the 130-billion-euro bailout.

However, some lawmakers have said that they would vote against it and thousand of Greeks were out on the streets in protest. Greek lawmakers will vote this weekend on a controversial austerity bill that Athens needs, to avoid a default.

Coal prices to be set under market principles

Electricity rates will rise when coal prices begin to be set under a market principles this year, the deputy director of the Electricity Regulatory Authority of Viet Nam, Dinh The Phuc, said on Monday.

In a press conference held by the Ministry of Industry and Trade in Ha Noi, Phuc said the Ministry of Finance would apply market principles to set coal prices this year, but the Electricity Regulatory Authority had not yet received any official documentation establishing procedures for increasing the prices.

Deputy Minister of Industry and Trade Nguyen Nam Hai said that electricity was a backbone of the economy, requiring rates to be increased incrementally under a roadmap so as not to cause dramatic disruptions to industry or people's lives.

Phuc confirmed that input materials prices were one of three factors that wousld be used to adjust electricity rates pursuant to Prime Minister's Decision No 24, issued last April.

Under that decision, the period between two consecutive electricity rate increases must be at least three months. After three months, if the increase in input material prices would affect overall electricity rates by less than 5 per cent, the increase in rates would not be approved.

Coal prices for steel and cement would still be set under a special price regime that would take into account difficult economic circumstances, e.g., high interest rates.

Addressing power supplies generally, Phuc said, barring unusual fluctuations in hydrography, the power sector would be able to guarantee adequate electrical supplies this year.

However, power supplies for Ha Noi this year would face some challenges due to obstacles in land clearance for an electricity transmission-line construction project.

Dealing with enterprise names that violate IP rights

Circular No 37/2011/TT-BKHCN takes effect on February 11. Issued by the Ministry of Science and Technology on December 27, the new circular provides detailed guidance for implementation of Decree No 97/2010/ND-CP on sanctions for administrative violations of industrial property rights.

Among other significant changes, the circular introduces a detailed procedure for handling infringements of intellectual property rights involving enterprise names.

Decree No 97 provides for measures to revoke enterprise names containing elements infringing protected trademarks, trade names, geographical indicators or other enterprise names that constitute an act of unfair competition.

In addition to Decree No 97, Government Decree No 43/2010/CD-CP of April 2010 also prohibits use of enterprise names infringing on protected trademarks, trade names or geographical indicators; it gives an intellectual property rights owner the power to request the Business Registration Authority to issue a cease-and-desist order to the infringing enterprise regarding use of the name.

In light of the provisions set forth in Decrees 43 and 97, a number of enforcement actions have been carried out against infringing enterprises. For example, in 2011, Vincon Land and Finance Investment Joint Stock Co (Vincon) had to change its name because the name "Vincon" was found to have infringed upon the name "Vincom" which had been protected for similar services.

The new circular contains specific provisions for co-ordination between business registration and IP rights enforcement authorities in handling infringements relating to enterprise names. Under the procedure introduced in the circular, the IP enforcement authority, upon receipt of a complaint from the IP rights owner, and based on the results of its own inspection, may issue either (1) a conclusion that use of the enterprise name constitutes an infringement of IP rights, or (2) a decision of administrative sanctions against the infringer, including a measure of compelling a change of the enterprise's name.

In the first case, the infringer will be given 15 days to negotiate an acceptible solution with the IP rights owner. If the parties cannot reach an agreement within that time limit, the IP rights owner may send a copy of the conclusion to the business registration authority and request them to issue a cease-and-desist order. If the infringer does not comply, the IP enforcement authority will be requested to issue a Decision of Administrative Sanction against the infringer. The Decision of Administrative Sanction may include measures for compelling a change of the enterprise's name.

Upon issuance of the Decision of Administrative Sanction, the IP Enforcement Authority will notify the Business Registration Authority for ordering the infringer to change the enterprise name. However, if the infringer does not comply, the Business Registration Authority will publish the information about the administrative sanction on the National Business Registration Portal.

Although the new circular introduces detailed procedures for handling infringements relating to enterprise names, its provisions are intricate and complicated. It also fails to explicitly give the business registration authority the power to ultimately revoke the business registration of an infringing enterprise that does not comply with cease-and-desist orders. Infringers may still be able to use the infringing name even after a sanction decision has been issued compelling it to change the infringing enterprise name. The circular should be clarified further to allow more effective and expeditious measures against infringingements involving enterprise names.

Tuna exports to US expected to increase

US demand for Vietnamese tuna is expected to increase this year, the Viet Nam Association of Seafood Producers and Exporters (VASEP) announced.

The US must increase tuna imports from Asian countries because of restriction on tuna imports from Mexico, the association said.

Last year, the US was the largest export market for Vietnamese tuna. The export value of tuna in the US increased last year by 31.8 per cent to US$171 million against 2010.

Meanwhile, Viet Nam's total tuna export value reached $379.3 million in 2011, 29.4 per cent higher than the previous year, the association said.

Fishermen have had massive tuna hauls so far this year, the association said. However, tuna catches are subject to strict controls and must abide by the Agreement on International Migration of Fish, which comes under the Convention on International Law of the Sea.

When the fish migrate to Vietnamese waters, catches are subject to The Western and Central Pacific Fisheries Commission (WCPFC). The international organisation strictly controls tuna catches worldwide, even though Viet Nam is not a member.

Vietnamese fishermen and tuna-exporting enterprises will face challenges selling their fish abroad, the association said, adding that it would be in Viet Nam's interests to join the WCPFC to develop trade marks for Vietnamese tuna products.

Additionally, tuna-exporting enterprises should invest in cold-storage facilities and large fishing boats, while helping fishermen to reduce costs and boost efficiency.

Those enterprises should also expand export markets in co-operation with foreign partners, the association said.

If these conditions are met, Viet Nam could drastically increase tuna exports this year, VASEP said.

Slight fall in rice prices in Mekong Delta  

Farmers in the Mekong Delta have begun to harvest their winter-spring rice crop, even as rice prices are showing a slight fall along with a slowdown in consumption.  

The IR 50404 rice variety has dropped by VND200 a kilogram to sell for around VND5,500-5,700 in Ca Mau, Soc Trang and Bac Lieu Provinces.

A kilogram of long grain rice is fetching VND5,500-5,700, the lowest since early 2012.

Nguyen Thanh Bien, deputy Minister of Industry and Trade said that after the long Tet holiday season, most of the businesses are concentrating to meeting earlier orders instead of purchasing, which has caused a slowdown in consumption.

The condition may improve in February and March when businesses resume signing of new export contracts. The Ministry of Industry and Trade and other relevant ministries are trying to keep rice prices at profitable margins for farmers.

The Vietnam Food Association has planned to buy rice for stockpiling in case consumption slows, so as to ensure that rice prices do not slide below VND5,000 per kilogram.

According to the association, rice exports of over 279,000 tonnes in January this year reached US$154 billion, accounting to 50 per cent as during the same period last year.
 
Gas price remains high as more commissions granted for retailers

Though the world cooking gas price is on a downward trend, the local retail price still remains high as more commissions are set aside for retailers.

Excluding Vinagas, Gia Dinh Gas and Petrolimex Gas, many other retailers, like Elf, Total, Thu Duc, and Saigon Petro, yesterday raised their commission rates by VND7,000-12,000 per 12-kilogram/12.5-kilogram cooking gas cylinder.

Among them, the rates applied by Thu Duc until the middle of February were VND10,000 and VND38,000 per 12-kilogram and 38-kilogram cylinder respectively.

Those firms told Tuoi Tre the move is aimed at clearing their stocks in the post-Tet (Lunar New Year holiday) period.

In addition, as the world price will probably drop by $40 a ton in March, it is a supportive move for their retailers, they said.

Some retailers in Ho Chi Minh City and neighboring Long An Province told Tuoi Tre their commissions are about VND45,000-50,000 a cylinder.

Cooking gas firms said they have not considered cutting their retail prices.

The recent price hike has resulted in fewer customers, Quy, a retailer in Thu Duc District, told Tuoi Tre.

Cao Tien Chuong, chairman of retailer Binh Minh Gas Co Ltd, said that company sales have dropped compared to before Tet.

Many insiders, however, told Tuoi Tre that it is a usual move by the cooking gas firms to expand their retail networks by offering higher commissions to make the distributers of other networks switch to them.

As HCMC did not license new cooking gas retailers in recent years, cooking gas wholesalers have to adjust the commission rates following the requirements of big retailers so that they won’t switch to the others, director of a HCMC-based cooking gas firm told Tuoi Tre.

Le Thi Anh Man, vice president of Vietnam Cooking Gas Association, said it has suggested that those firms cut the retail price for consumers, but it cannot intervene in commission decided between the wholesalers and retailers.

Many are expecting the government and the Ministry of Finance to cut the import tariff slapped on cooking gas from 5 percent to 2 percent, she said.

If it is realized, the retail price may then be lowered, she added.

The Price Management Department under the Ministry of Finance has asked local finance departments to tighten inspections on cooking gas retailers in an effort to clarify why the price has soared to VND74,000 a 12-kilogram cooking gas cylinder this year.

It will launch an overall checkup of 5 out of 7 cooking gas firms that have registered their selling prices with the ministry.

Regarding the proposed tax cut, department head Nguyen Tien Thoa told Tuoi Tre that it may only be approved when world price surges.

Though the current tax rate is only at 5 percent, the lowering of import duties may also be considered by the ministry.

“I agree with the proposal so that consumers could partly lighten their burden in the face of inflation,” he said.

The granting of high, limit exceeding commissions to fuel retailers was disclosed as a reason for losses incurred by fuel wholesalers in the first half of last year, said Le Hoang Hai, deputy head of the Business Finance Agency under the Ministry of Finance in a press briefing in late December.

Specifically, Petrolimex suffered a VND1.31-trillion loss, Petimex, VND136 billion, Saigon Petro, VND7.5 billion, and PV Oil, VND382 billion.

The Ministry of Finance has stipulated the “fixed” business expenses at VND600 in the fuel retail price calculation, although there is no regulation on the specific commission rate wholesalers are allowed to pay their dealers, said Deputy Minister of Finance Vu Thi Mai.

The expenses include the commission for dealers.

The state audit has found that many wholesalers pay a commission exceeding that limit, because the wholesalers are allowed to negotiate commissions with their dealers.

“While consumers have to suffer from high fuel retail prices, and the government has been made an effort to tame the high inflation, it is unreasonable for wholesalers to offer such high commissions,” Mai said.
 
Increasing private sector’s role in Vietnam Business Forum

The International Finance Corporation (IFC) has transferred the role of the Vietnam Business Forum secretariat to the private sector as of February 8, 2012.

Over the past ten years, IFC has supported periodical dialogue programmes with the Government to improve the business environment in Vietnam.

Established in 1998, the forum has contributed to ironing out snags and improving transparency in business operation and investment.

14 business associations, local and international chambers of commerce and industry have agreed to promote the forum’s activities.

Christopher Twomey, President of the American Chamber of Commerce and Industry in Vietnam said that the new move of the forum secretariat reflects an inevitable step of development in the chamber’s role as a representative for the business community to co-ordinate with the government to remove obstacles to business expansion and job creation in the private sector.

Minister of Planning and Planning Bui Quang Vinh emphasized that he highlighted the active participation of the business community at the forum, especially the role of the forum secretariat. He pledged to continue to support the forum in operating effectively to improve Vietnam’s business environment.

Together with the governments of Netherlands, Ireland, Holland, New Zealand and Switzerland, IFC said that it will continue to support the new Secretariat to fulfill its co-ordination role in the forum’s activities. In addition, the World Bank and IFC will resume its role as co-chair of the forum.

Simon Andrews, IFC Regional Director for Vietnam, Cambodia, Laos and Thailand highlighted the determination of the private sector and the government to improve the business environment and attract investment.

He added that with dialogue mechanism firmly put in place, the forum should promote co-ordinated efforts by the business community to ensure sustainability in the long-term.

The forum is also a model that has been applied to similar dialogue mechanism between the Government and the IFC-supported private sectors in Cambodia and Laos.

The new secretariat includes the American Chamber of Commerce and Industry in Vietnam, the European Chamber of Industry and Trade, the Vietnam Chamber of Industry and Trade, the Australian Chamber of Industry and Trade, the North European Chamber of Industry and Trade in HCM City, the Canada Chamber of Trade in Vietnam, the Korea Trade Investment Promotion Agency (KOTRA) in Vietnam, the Vietnam Footwear Association, Hanoi Young Entrepreneurs Association, the UK Business Association in Vietnam, the Hong Kong Business Association, the Japan Business Association in Vietnam, the Japan Business Association in HCM City and the Singapore Business Association.

Exports to Chile to enjoy zero percent status

Tariffs on most exports between Vietnam and Chile will be lowered to zero percent under the Vietnam-Chile free trade agreement which has just been approved by the Vietnamese Prime Minister.

Under the FTA signed on November 11, 2011, Chile has committed to removing 99.62 percent of tariff lines for imports from Vietnam within ten years. Immediately after the agreement takes effect, 83.54 percent of tariff lines on Vietnam’s exports to Chile will be cut to zero percent.

Meanwhile, Vietnam will also eliminate 87.8 percent of tariff lines for Chile’s goods within 15 years. Among the remaining 12.2 percent of tariff lines, 4.08 percent of tariff lines are included in the exclusion list, 3.37 percent of tariff lines will maintain their base rates and 4.75 percent of tariff lines will have the tax rates reduced.

The two countries will offer incentives to investment and services sectors three years after the agreement takes effective.

According to Vietnam’s Customs General Department, two-way trade between Vietnam and Chile rose from US$18.81 million in 2001 to almost US$475 million over the past decade.

Vietnam’s total exports to Chile reached US$137.5 million last year while its imports from the South American country were worth more than US$335.7 million.

Last year, Vietnam exported textile and garments, footwear, seafood, machinery and equipment and coffee to Chile, and imported metal, scrap iron, wood and wood products, animal feed and fruit and vegetables.

Experts differ about property market’s prospect

Some property experts expect the market to improve early this year though most say it will continue to face difficulties, at least to the end of the second quarter.

Some property experts expect the market to improve early this year though most say it will continue to face difficulties, at least to the end of the second quarter.

The optimists hold that government efforts will help the market recovery, saying now is the chance for buyers with actual demands for housing to make good bargains.

After the long Tet holiday, most property exchanges in Hanoi have resumed operation. Some have signed their first contracts of the year for brokerage of apartments, residential land or semi-detached houses.

A representative of the property exchange Phuc Thinh in Hanoi said his office had successfully brought back two apartment purchase contracts in Dich Vong and Xa La on the first opening day after Tet.

Since early January, the two offices of this brokerage firm have won four apartment and land contracts compared to the five signed in the last quarter of 2011.

Explaining these positive signs, the representative said some investors deemed it good luck to make transactions at the beginning of a new year.

Meanwhile, those in need of housing are also taking advantage of the low season after Tet to look for houses at reasonable prices.

A popular area in Hanoi is Thanh Tri District, which is not too far from downtown.

Residents in Duyen Ha Commune, Thanh Tri District said that after Tet, many people had come to seek residential land and some successful transactions had been made.

Representatives of many other real estate trading floors in Hanoi show optimism about the market’s short-term outlook.

However, property experts say the market may not prosper much this year since funding for the sector still depends heavily on the banking system. If interest rates are still high, the market cannot thrive.

Furthermore, Nguyen Van Duc, director of Dat Land Real Estate Co., said many cash-strapped investors would sell their projects to pay their debts. If the situation worsened this year, many investors would have to restructure their financing sources.

If the central bank flexibly and selectively relaxed its credit policy for the property market, and if proposals by ministries were approved by the Government, the market could make some recovery, but not until the third and fourth quarter of 2012, said a representative of the Vietnam Real Estate Association.

In fact, apart from a few small transactions, many big projects in Hanoi have not recorded positive changes in their sales. A project on Kim Dong Street has attracted much attention because of the selling price of only VND18 million per square meter, coupled with autos as gifts, to improve the sluggish pre-Tet sales.

Some 22,000 apartments of 60 projects will be launched in Hanoi this year, according to a report by CBRE. This will put more pressure on property developers as trading volume is expected to stay low and the percentage of successful deals insignificant.

Besides, they will have to compete with investors involved in land lot selling projects, who have pulled down their prices sharply in last year’s fourth quarter.

CBRE said the future developments of the market would depend much on the recovery of the economy.

By the end of 2012, the housing projects whose prices are VND21 million per square meter will stay resilient. Besides, the luxury projects in downtown Hanoi and HCMC will catch the attention of financially capable investors and families.

Vietnam Airlines transports over 1 mln passengers during Tet

The national flag carrier, Vietnam Airlines, announced on February 7 that it had transported safely over one million passengers during the Lunar New Year festival (Tet) from January 7-30.

This figure represented a seven percent increase over the same period last year, despite adverse weather conditions, especially at Cat Bi, Dong Hoi, Vinh and Hue airports.

Vietnam Airlines handled more than 11,200 tonnes of cargo and parcels during the reviewed period.

Its on-time flight rate reached approximately 89.6 percent, as high as last year, and it ensured aviation safety and security before, during and after Tet.

The carrier has introduced a series of innovations to improve its efficiency and safety.

Taiwanese bank, PVN financial arm to lend $7.2mln to VNA

Taiwanese Cathay United Bank (CUB) and PetroVietnam Finance Joint Stock Corp (PVF) have signed a credit contract in Hanoi to lend $7.22 million to the national flag carrier Vietnam Airlines.

Under the contract, Vietnam Airlines (VNA) will receive the 7-year credit worth up to $7.225 million from two financial institutions to purchase backup engines for Airbus 321 airplanes.

The purchase is a part of the VNA's project to invest in 10 new A321 aircraft which is expected to help the firm take initiative in operating its flights, maintaining service quality and ensuring business stability, according to the Vietnam News Agency.

CUB will be the main financer, while PVFC will be the agency to arrange capital and manage secured assets.

As planned, VNA will expand its fleet to 115 planes by 2015 and 170 by 2020, mainly with aircrafts of the following types: Boeing 777; Airbus A330, A321, A320, A350 XWB; and Boeing 787-9.

The new airplanes are said to be technologically advanced, fuel efficient and eco-friendly.

In May last year, VNA received a loan of more than $7 million from the Ocean Bank to buy standby engines made by the International Aero Engine AG for Airbus 321.

CUB, former United World Chinese Commercial Bank, was established in 1975.

Till the end of 2010, total assets of CUB reached more than 1.600 trillion Taiwanese dollars (around $55 billion); its pre-tax profit was posted at $436 million.

Tuyen Quang to export 70,000 tonnes of barite powder this year

Barite processing businesses in the northern province of Tuyen Quang are allowed to export around 70,000 tonnes of powdered products after meeting domestic use, according to the Government’s direction.

Currently, the province is co-ordinating with the Ministry of Industry and Trade (MoIT) to direct the export of barite powder under the relevant regulations to avoid anti-dumping issues.

Barite is used in the petroleum and glass industries, and is among the major materials to produce many chemical products.

Exporting barite powder will make an important contribution to improving the province’s goods export turnover, expected to hit more than US$15.1 million this year.  

Renowned economists to gather for talk

20 renowned entrepreneurs and economists will gather to speak about international and local economy at the Super Investors Day 2012 in HCMC next Thursday.

The 12-hour event, to be held at Nguyen Du Gym in District 1, will be hosted by Doanh Nhan Magazine, Le Bros Co., Vinabull Fund and InfoTV Channel.

The speakers will address macro-economic issues, economic sectors which can make a breakthrough, financial investment channels for 2012, and business startup and possible obstacles.

Keynote speakers will include American Consulate General in HCMC Le Thanh An, Trung Nguyen Coffee CEO Dang Le Nguyen Vu, Saigon Jewelry Co CEO Le Hung Dung, Vinamit CEO Nguyen Lam Vien, Saigon Paper CEO Cao Tien Vi, Financier David Jensen, and economists Le Dang Doanh and Pham Chi Lan.

“We hope to spread new ideas about how to start up and build up a business in s sustainable way for contemporary and future generations of Vietnam,” said Dr. Alan Phan at the press conference introducing the event.

“I bet on the future development of Vietnamese agriculture and information technology which I think are the main competitive advantages of Vietnam,” he said. “The event is a chance for those who want to pursue a future career in these sectors to learn how to make money from them.”

Regarding investment strategies that will be among the 4 main subjects of the conference, financier David Jensen said the event would focus on long-term investments, rather than short-term speculation.

“In general, about 80% of speculators will fail in the long-term, so we want to make financial investment a safe and sound channel for investors, not only for the year 2012 but for a sustainable future,” he said.

“The year 2012 may be a turbulent year for both domestic and international economies, but it will be a good time for making the right investments, if we know the basics.”

A-grade and B-grade tickets are available at VND1 million and VND500,000 each respectively with special discount of 30% for groups of at least 10 participants, or companies registering for 10 or more employees.

University and college students will have a seat for VND100,000 each.

More information can be found at www.superinvestorsday.com.

Business registrations head south

Industry insiders are worried over a sharp decline in new businesses in 2012.

In January 2012, just 4,117 new businesses were registered to set up with around 18.2 trillion ($866.6 million) total registered capital, down 36 per cent in number and 56 per cent in capital amount against the same period in 2011, according to a Ministry of Planning and Investment (MPI) recent report.

The MPI attributed sharply sliding new businesses to a cold climate for firms’ production and trading activities on the back of flat world economic performance which had detrimentally affected Vietnam’s export market and financial market, a mainstream capital raising channel to firms.

“Besides, enforcement of tight fiscal policies to tame inflation has also hindered firms from getting loans. These are key reasons behind shrinking new businesses and augmenting numbers of firms going dismantled or having to shut up shop,” the report read.

Senior economic expert Hoang Xuan Quyen, however, held a different view.

Quyen assumed new firms’ retreating numbers caused no surprise to economists when the world and local economies were in the doldrums with stagnant production, soaring lending rates and unemployment, and sagging demands.

“Newly established firms factor is just a raw indicator. The quality of firms is more important,” said Quyen, adding that propitious macro-economy often entails a boom in the number of new firms parallel to risks associated with firms’ losses and bankruptcies. This was evidenced by booming presence of property and securities firms in some recent years and their current negative business performance.

“From other angle, declining new businesses reflects firms’ cautious attitudes when the business climate is full of risks with shaky profits. This is deemed by some economists as a necessary correction and a ‘positive’ prudence,” Quyen asserted.

Vietinbank opens branch in Laos

The Viet Nam Jointstock Commercial bank for Industry and Trade (Vietinbank) opened a branch in Vientiane yesterday.

At the inauguration ceremony, Lao State Bank Governor Somphao Phaysith and State Bank of Viet Nam's Deputy Governor Dang Thanh Binh praised the branch and said they hoped it would help promote economic co-operation, trade and bilateral investment between the two countries, as well as foster their special relationship.

Vietinbank CEO Pham Huy Hung affirmed the branch's operations would be transparent and efficient.

It would become a major commercial bank in Laos to contribute to the country's socio-economic development, he said.

This is the bank's second overseas branch. The other is in Frankfurt, Germany.

Listed companies report losses

Over 85 listed companies on both of the nation's stock exchanges have reported losses in the fourth quarter of last year, with many posting losses for the entire year. Many of these operate in the financial, real estate and construction sectors. Only 13 per cent of listed firms so far have released their financial reports for last year.

Securities firm gets longer suspension

The HCM City Stock Exchange has extended the suspension of SME Securities Co (SME) as the company has continued to fail to settle its transactions. The Ha Noi Stock Exchange yesterday also suspend SME's operations on both the listed and unlisted markets until February 15. SME is consulting with its shareholders about halting brokerage operations.

State sovereign fund to form investment unit

A senior official of the State Capital Investment Corporation (SCIC) said it would establish a financial investment company specialising in direct investments in securities, upon final approval of the plan by the Prime Minister.

The official, on condition of anonymity, said that the restructuring would prevent conflicts of interest arising from SCIC from combining its investment activities with its ongoing role as the representative of State holdings in a large number of equitised enterprises.-

Master plan for Gia Lam unveiled

The Ha Noi People's Committee has approved a detailed master plan of the Gia Lam urban area in the outskirt of the capital's Gia Lam District.

The project, which covers 377 ha in Trau Quy Town and the communes of Duong Xa, Kieu Ky and Da Ton, is expected to house a population of between 23,000 and 25,000 when it is completed.

The Viet Nam Infrastructure Development and Finance Investment Joint Stock Company is in charge of construction.-

Plastics firms get plenty of orders

Plastic exporters have already received sufficient export contracts for the first half of this year, with order prices surging 10 per cent over last year, said Ho Duc Lam, deputy chairman of the Viet Nam Plastics Association.

Lam said that key importing markets for Vietnamese packing, canvas, and household plastic utensils were Japan, the US and Germany. Importers of plastics products have begun to move their orders from China to Viet Nam.

VPA estimated plastic export turnover this year would be US$1.7 billion, up 25-28 per cent over last year.

Da Nang cargo port kept busy

Cargo shipped via the Da Nang Port totalled 336,440 tonnes in the first month of the year.

The port authority aims to create a hub for transport shipments and has focused on speeding up the opening of more container ship routes.

It has also targeted modernisation and development of facilities and logistics, as well as the improvement of market policies.

VN-Brazil trade passes $1.4b

Two-way trade between Viet Nam and Brazil reached more than US$1.4 billion last year, up 53.8 per cent over 2010, said Brazil's Ministry of Development, Industry and Foreign Trade.

Viet Nam exported nearly $647 million to Brazil, up 36.6 per cent. Key export staples included footwear, frozen fillet fish, rubber, cement, auto types and electric engines.

Banks may be told to improve liquidity

Banks will be required to improve liquidity under a restructuring plan being considered by the State Bank of Viet Nam.

The State Bank pumped about VND71 trillion (US$3.38 billion) into the banking system via open market operations to shore up liquidity prior to the Tet (lunar new year) holiday, but banks remain under high compulsory reserve requirements and tight restrictions on granting credit.

National Financial Advisory Council vice chairman Le Xuan Nghia said that to improve bank liquidity in the long term, new tools were needed, included re-financing from the State Bank; higher compulsory reserves requirements to help regulate supplies of capital maintained by banks; and allowing banks holding gold on account to use funds raised against these holdings.

Last week, the central bank granted permission to five credit institutions to maintain their compulsory reserves in Vietnamese dong at below regulated levels for a five-month period starting this month.

The Mekong Development Commercial Bank, Mekong Housing Bank, Agribank, LienViet Post Bank and Central People's Credit Fund will be allowed to maintain compulsory reserves 20 per cent below the levels required under current regulations.

The lower compulsory reserves requirements were tied, however, to requirements that would require them to loan the additional funds to agricultural producers, rural development projects and exporters.

At the monthly Government meeting last Saturday, Nguyen Thi Hong, director of the State Bank's monetary policy department, said that the liquidity of credit institutions had improved since Tet, with banks and credit institutions attracting a significant volume of deposits.

When the nation's ongoing problem with inflation is brought under control, deposit interest rates should be deregulated and lending interest rates lowered, giving banks a higher margin on capital, Nghia said, forecasting that this would likely take place early in the second quarter of this year.

At the same time, monetary and fiscal policies should be implemented flexibly and prudently with an aim at giving top priority to key industries, he said, adding that measures also needed to be taken to promote the development of the nation's real estate and capital markets.

Int’l cruise ships dock in Ha Long Bay

Costa Classica and SuperStar Aquarius, two international luxury cruise ships carrying a total of 4,000 visitors and crew members, were received by Vietnam’s leading tour operator Saigontourist in Ha Long Bay on February 9.  

During their stay in Ha Long, visitors will make the tour of the bay and go to Long Tien pagoda, shop at Hon Gai and Bai Chay markets, see a water puppet show and traditional art programme, and explore the daily life of local fishermen.

Saigontourist is scheduled to receive two more cruise ships shortly; the Spirit of Adventure on its voyage from Ha Long to Ho Chi Minh City from February 24-March 1, and the Columbus sailing from Danang to Hai Phong from February 21-23.

Ha Long Bay has been twice recognised as the World Heritage Site by UNESCO.