Son La Province invites investment for 21 projects

The Son La Province is seeking investment for 21 key projects, especially in the sectors of tourism, trade and services, agro-forestry-fishery, and processing and manufacturing, the Voice of Vietnam (VOV) reported.

To this end, the northern mountainous province will continue to speed up administrative reforms, improve infrastructure to draw investors, VOV quoted the Deputy Director of the provincial Department of Planning and Investment Tran Thanh Hai as saying.

Last year, Son La had granted licences to 21 projects, lifting the number of projects in this locality to more than 210, capitalized at approximately VND28 trillion (US$1.3 billion).

Growth in 2016-2020 unlikely to surpass 6%

The country's average annual economic growth rate for the 2016 to 2020 period is unlikely to exceed 6 per cent due to little improvement in growth motivation.

This has been forecast by a research group under the Vietnam Institute for Economic and Policy Research (VEPR).

The group said the high growth rate of 7.5 per cent seen during the 1990s and in early 2000s will not return going forward.

The institution noted that if there is no new growth motivation stemming from an improvement in labour productivity, it will make it difficult for the country's economic growth to avoid a long-term slippage.

It added that a credit growth of 12 to 15 per cent will help maintain an inflation target of 6 per cent. However, a credit growth of around 20 per cent will lead to a risk of high inflation (over 10 per cent).

To improve the growth rate and quality of the economy, research group VEPR stated that it is necessary to boost productivity of the total economy and restructure it for higher quality.

Innovations in economy and administration are also decisive actions, the group said.

VEPR also forecast that GDP will increase by about 6.2 per cent this year. This ratio is 0.2 points more than the estimated growth rate for 2014.

The inflation rate by the end of 2015 is expected to reach to 4.09 per cent, higher than 1.84 per cent in December 2014.

According to VEPR, the inflation rate has allowed the Government to adjust the prices of public services, including electricity prices. The increase in electricity prices will affect manufacturing costs, but will be limited to consumer prices.

In addition, if crude oil prices continue to decrease sharply, the balance in the economy will be affected. Therefore, the growth rate will possibly lose 1 to 1.5 percentage points, while the inflation rate will lose 4 to 6 percentage points, VEPR pointed out.

In the case of an easy monetary policy, combined with the sensitivity of consumers and investment with low interest, the growth rate could possibly increases by 0.1 to 0.2 percentage points, while the inflation rate will remain below the target of 5 per cent.

Financial attacks against Android users triple

The number of financial malware attacks against Android devices grew by 3.25 times last year, topping 2.3 million, according to a new report by security software provider Kaspersky Lab.

Kaspersky Lab's Android products last year blocked a total of 2,317,194 financial attacks against 775,887 users around the world.

Most of these (2,217,979 attacks against 750,327 users) used Trojan-SMS malware, and the rest (99,215 attacks against 59,200 users) used Trojan-Banker malware.

Although the Trojan-Banker contribution against Android users was relatively small, it continued to grow, it said.

Kaspersky Lab products detected 20 different malicious Trojan-Banker programmes, but most attacks by Android banking malware were by only three malicious families - Faketoken, Svpeng and Marcher.

Vingroup to open VinMart+ convenience stores in HCMC

Vingroup launched the VinMart Dong Khoi supermarket in HCM City on Sunday, and will open the first 10 VinMart+ convenience stores in the city two day later.

On the occasion, the group announced discounts on thousands of items, as well as other incentives for its customers in the city.

Vinmart Dong Khoi, the second Vinmart in the city, is spread over two floors with a total area of more than 4,000sqm in Dong Khoi Street, one of the most crowded locations with thousands of visitors every day.

Meanwhile, the convenience stores in District 1, 2 and 4, Phu Nhuan, Binh Thanh and Tan Binh, as well as Go Vap, Thu Duc and Nha Be will cover smaller areas, carry the slogan "Nearer and Faster" and supply essential goods that will be arranged according to customers' convenience.

They are among 100 VinMart supermarkets and 1,000 VinMart+ convenience stores that Vingroup plans to construct nationwide by 2017.

Cambodia holds sixth HCMC expo

Around 90 Vietnamese companies will set up 150 booths at the sixth HCM City Expo to be held in Cambodia's Battambang Province from April 1 to 5.

Organised by the HCM City Investment and Trade Promotion Centre (ITPC) annually since 2010, it is meant to support the municipal companies trying to enter or expand their business in Cambodia and popularise Vietnamese products there.

The expo will feature three parts. The first will highlight the city's cultural and socio-economic achievements and the co-operation between the two countries. The second will be a place to display agricultural and industrial products. The last will be for showcasing services.

During the five days of the event, HCM City leaders will meet with leaders from six north-western provinces of Cambodia to draft plans to strengthen business and investment co-operation between companies from the two countries.

Binh Duong exports earn $2.94b

The southern province of Binh Duong recorded nearly US$2.94 billion in export revenue in the first two months of 2015, an annual increase of 14 per cent.

According to the municipal Statistics Department, the foreign-invested sector contributed $2.38 billion to the sum, a 15.1 per cent increase over 2014.

Major exports reflecting significant growth include woodwork products, apparel, footwear, phones and electronic devices.

During the same period, the province imported commodities valued at $2.52 billion, a 14.7 per cent annual increase. It saw $415 million in trade surplus.

Also in January and February, Binh Duong attracted nearly $180 million in foreign direct investment (FDI). This year, the province aims for $1 billion in FDI.

FLC posts 231% profit increase between 2013 and 2014

FLC Group posted an audited aggregrate profit of VND454 billion (US$21.2 million) for the whole of 2014, an increase of 231 per cent over the previous year and VND22 billion ($1.02 million) higher than the unaudited financial report.

The group's turnover last year reached VND2.06 trillion ($96.2 million), an 18 per cent year-on-year rise, making its earning per share VND1,953.

FLC saw a breakthrough development last year because it has completed a capital-increase target and developed several big property projects, including FLC Garden City, FLC Complex 36 Pham Hung, FLC Star City and FLC Complex Thanh Hoa as well as investments in other sectors, such as industrial zones, build and transfer projects.

It targeted a profit of VND1 trillion ($46.7 million) this year with the sale of the projects outlined. FLC is expected to ask the shareholders' meeting to pay a bonus at 20 per cent of charter capital.

HAI Agrochem expects to see $1.5m in profit by June

HAI Agrochem Joint Stock Company is expected to achieve a profit of VND33 billion (US$1.5 million) in the first half of the year, double that of the previous financial year.

The company said it would have a turnover of VND700 billion ($32.7 million) in the period. In the first quarter of the year, it had a profit of VND10 billion ($467,000), which was mainly from restructuring its financial investment and other assets.

This year, it will focus on overall restructuring by increasing charter capital to expand operation in high profit sectors and developing products and services in the agriculture industry. HAI's management board approved the plan to sell 15 million shares at VND12,500 each.

SASCO plans to list on HCM Stock Exchange in 2015

The Southern Airport services Join Stock Company intends to list on the HCM Stock Exchange this year.

SASCO, which held an IPO last September at the exchange for an average price of VND19,330 and has a chartered capital of VND1.315 trillion ($61 million), is now wrapping up procedures for listing on UPCoM in the second quarter.

The Government owns 51 per cent of the company, leaving the rest to strategic partners (almost 24 per cent), the public and employees.

The company's interests include duty-free shops, foreign currency exchange, transportation and others.

This year it expects to earn a profit from operations of almost VND165 billion, rising to VND176 billion in 2016. Last year's earnings were VND86 billion.

Ha Noi urged to better socio-economic development

PM Nguyen Tan Dung has urged Hanoi to better implement socio-economic tasks during a meeting with the capital’s leaders on March 5.

The meeting saw the presence of Deputy PMs Nguyen Xuan Phuc, Hoang Trung Hai, Vu Van Ninh and Vu Duc Dam and leaders from several ministries and central agencies.

On behalf of the Government, PM Dung praised Ha Noi’s achievements in socio-economic development and expressed his hope that the city would promote ít strengths, uphold responsibility and overcome shorcomings to realize targets set for 2015.

The Government leader also urged Ha Noi to make new development steps in the five coming years to become a role model for the whole country.

The Government, ministries and sectors will uphold their responsibilities in building the capital city while in certain areas authorized for the city as regulated, Hanoi should promote creativeness and dynamism during implementation, PM Dung said.

He asked for the meeting’s draft conclusions which will be discussed at the Government’s next regular meeting.

During the meeting, PM Dung, the Deputy PMs and leaders from several relevant ministries and agencies responded to ten suggestions of the capital city about finance, business support, development investment, planning, urban development and organization.

According to Chairman of the Ha Noi Municipal People’s Committee NguyenThe Thao, in 2015, Ha Noi will strive for a growth rate of 9-9.5%, a VND75-77 million income per capita, a 11-12% rise in social investment, an 8-9% increase in export turnover and 55 more communes to be recognized as new-style rural areas.

Leading Vietnamese realty firm opens more retail outlets in Ho Chi Minh City

Leading Vietnamese realty firm Vingroup has opened another Vinmart supermarket in downtown Ho Chi Minh City and will inaugurate 10 Vinmart+ convenient stores at the same time in the same city on Tuesday, newswire Vietnamplus reported on Monday.

The listed realty conglomerate put the Vinmart supermarket into operation yesterday at the shopping mall Vincom Center B at 72 Le Thanh Ton Street in District 1.

The supermarket is located on two floors with a total area of over 4,000m².  

It is the second such supermarket Vingroup has opened in Ho Chi Minh City and the 14th nationwide.

The realty group, coded VIN on the Ho Chi Minh Stock Exchange, will launch 10 Vinmart+ convenient stores at the same time tomorrow,Vietnamplus said.

The Vinmart+ chain, including mini-supermarkets and convenient stores, is located in central business districts, such as District 1 and District 4, and key residential areas in outlying areas like District 2, Phu Nhuan, Binh Thanh, Tan Binh, Go Vap, Thu Duc, and Nha Be.

Vingroup has planned to open 368 Vinmart+ stores nationwide in 2015.

The opening of the Vinmart supermarket and Vinmart+ convenient stores is part of Vingroup’s development strategy to expand in the retail market in which it set foot in 2013.

In October 2014, Vingroup announced the acquisition of a 70 percent stake in Ocean Retail Co., which was under Ocean Group, getting involved deeper in the lucrative retail market.

After the acquisition, Ocean Retail Co. was renamed Vinmart Supermarket and Vingroup introduced two new brands, Vinmart supermarkets and Vinmart+ convenient stores with plans to build a distribution network of 100 supermarkets and a chain of 1,000 convenience stores across Vietnam in the next three years.

As of October 2014, Ocean Retail had 13 stores and planned to add 40 venues across the country.

One month earlier, Vingroup announced the purchase of a 10 percent stake in the state-run Vietnam National Textile And Garment Group (VINATEX), the owner of the VinatexMart supermarket chain with many outlets in 26 provinces and cities throughout the country.

Vingroup stepped into the retail market with a string of shopping centers for children. It has also set up companies specializing in e-commerce, VinE-Com, and in fashion, the VinFashion firm.

The group has its shopping malls situated at prime locations in the country’s two biggest cities, namely Vincom Centers in Ho Chi Minh City and Vincom Mega Mall at Royal City and Times City in Hanoi.

HPG enters fodder industry

Steelmaker Hoa Phat Group (HPG) has officially launched a new subsidiary, which will produce fodder in the northern province of Hung Yen.

Steelmaker Hoa Phat Group has officially launched a new subsidiary, which will produce  fodder on March 9. Photo khoahocchonhanong.com.vn

HPG Vice Chairman Nguyen Viet Thang has been appointed as the Hoa Phat Fodder Production and Trading Ltd. Co.'s director and other officials of the group have also been selected for key positions in the company, which will operate with the charter capital of VND300 billion(US$14.08 million).

According to the group's representative, with a design capacity for 300,000 tonnes of fodder, the company is estimated to report revenue of VND3 trillion ($140.8 million) during the next three years.

The representative said steel making is the core business of the group, adding that entering manufacturing in the agriculture industry will be the long-term strategy of the group's development. Thus, HPG will set a priority in finance and human resources for the new field.

HPG Chairman Tran Dinh Long said even though the competition in the agriculture industry is hard, he believed the group will be successful.

The first batch of fodder is expected to be dispatched to the local market in June 2015, while the company's fodder factory is set become operational in 2016.

Last year, HPG reported a net revenue of VND26 trillion ($1.22 billion) and an after-tax profit of VND3.2 trillion ($150.2 million), reflecting a 62 per cent year-on-year growth.

Vingroup asks to buy Vietnam’s largest ports: media

Real estate conglomerate Vingroup, owned by the only Vietnamese billionaire in Forbes list, has told the Minister of Transport it wants to buy a stake in each of the country’s largest seaports, local media reported Friday.

Vingroup seeks to become the strategic investors of the Saigon Port in Ho Chi Minh City and Hai Phong Port in the namesake city in the north, according to the Vietnam News Agency.

The ports are under the management of the Vietnam National Shipping Lines, commonly known as Vinalines.

This is the second time Vingroup made the proposal to the transport ministry, according to the Hanoi-based newswire.

Vingroup is chaired by Pham Nhat Vuong, the wealthiest individual in Vietnam and the only Vietnamese representative in the 2015 Forbes Billionaire List released Monday, with a net worth of US$1.7 billion.

The company has proposed to acquire an 80 percent stake of Hai Phong Port at a price that is no less than the average successful bidding price.

Vingroup also wants to own 80 percent of the Ho Chi Minh City-based port at a price that is no less than the IPO price, and join in developing the privatization plan for the port.

“Vingroup is committed to follow all government’s policies and principles in the planning and management of seaports,” Vingroup general director Duong Thi Mai Hoa was quoted by the Vietnam News Agency as saying.

Vingroup has said it wants to operates, manages and explores the ports if the stake acquisition is approved. The company will employ the modern administrative management models for the ports to increase its unloading capacity and business effectiveness.

Newswire VnExpress said a high-ranking official from the transport ministry confirmed Vingroup’s proposal on Thursday.

If approved, it will be the largest-ever deal in regard of seaports in Vietnam.

Saigon Port was valued at VND4 trillion ($186.41 million) in early 2014, with the government holding a total capital of VND2.16 trillion ($100.66 million), according to VnExpress.

Hai Phong Port, the largest of its kind in northern Vietnam, went public after an IPO last year and has a total registered capital of VND3.27 trillion ($152.39 million). The government owns 95 percent of the port.

Under the plan to privatize the country’s seaports and airplanes, the minimum stake the government should hold in the facilities is 51 percent.

The proposition to acquire as much as 80 percent of the port of Vingroup thus requires the decision from the Prime Minister.

Business opportunities in the US alongside potential challenges were the main focus of a workshop in Hanoi on March 9 which aimed to get Hanoi businesses prepared for the Trans-Pacific Partnership (TPP) agreement.

According to former Deputy Chairman of the Hanoi Young Entrepreneur Association (HYEA), Dang Duc Dung, the TPP will assist Vietnamese businesses in gaining access to a market with over 800 million people and accounting for 40 percent of the global GDP.

Dung also noted that through the agreement, Vietnam can establish linkages with country members and have increased opportunities to receive investment and advanced technology from partner countries.

Bill Delaney, a lawyer on international commerce, said in order to invest and run businesses effectively in the US, entrepreneurs need to meet state-wide and national laws and business regulations.

A representative of Harwood law firm added that international commerce is complicated, presenting sophisticated rules and barriers on loading and finance.

The lawyers advised businesses to seek assistance from professionals to cut costs and avoid potential threats.

Power price hike to raise 2015 CPI by 0.23 percent

The 7.5 percent increase in electricity prices from March 16 is forecast to raise this year’s consumer price index (CPI) by 0.23 percent, said Nguyen Anh Tuan, Director General of the Ministry of Industry and Trade’s Electricity Regulatory Authority.

The hike will translate into an additional 4,800 VND (0.22 USD) for each household consuming 50 kWh of power a month, while those using 100 kWh a month will pay about 9,800 VND (0.46 USD) more, he said.

Tuan added since the price rise will affect low-income and disadvantaged families, State financial support for the electricity bills of these households will be increased by 153 billion VND (7.28 million USD) a year from the current 1 trillion VND (47.61 million USD).

A survey by Vietnam News Agency reporters shows that the price augmentation will have its largest impact on big power-consuming industries.

Truong Quoc Huy, General Director of the Vicem But Son Cement Joint Stock Company, said his firm uses about 100 kWh of electricity to produce one tonne of cement. Since power prices for manufacturing are higher than those for households, the power price hike will likely affect production costs and selling prices.

Electricity expenses account for about 7 percent of steel billet production costs. Between 400 and 600 kWh of power are needed to produce one tonne of steel billet, according to Chairman of the Vietnam Steel Association Ho Nghia Dung.

He estimated the 7.5 percent hike will raise steel production expenses by 80,000-100,000 VND (3.75-4.68 USD) per tonne, adding that it will be a burden for steel makers amid an a array of challenges such as decreasing prices of steel billet from China and Japan.

Vu Ngoc Bao, Vice Chairman and General Secretary of the Vietnam Pulp and Paper Association, said the power price escalation will cause a 0.5-0.8 percent rise in the industry’s manufacturing costs.

Huy and Bao suggested businesses minimise other expenses and consider accepting a profit decline to account for the power price increase.

Vincom tops two Asia Pacific Property Awards’ categories

Vingroup-run Times City urban area and Vincom Mega Mall Times City trade centre have been honoured with Vietnam’s “Best Mixed-used Development” and “Best Retail Development” awards 2015 by the Asia Pacific Property Awards.

The 36-hectare Times City won for satisfying strict criteria in architecture, planning, and environmental protection.

Meanwhile, the Vincom Mega Mall Times City, covering 200,000 square meters inside Times City, surpassed other trade centres nationwide thanks to its outstanding features and leading shopping, entertainment and food facilities.

Vingroup has been honoured six times by the International Property Awards in the past three years. In 2012, the firm won “Best Mix-used Development – Asia Pacific” for its Vinhomes Riverside urban area.

Last year, its Vincom Mega Mall Royal was also honoured with the “Best Retail Development” award.

The Asia Pacific Property Awards are part of the 20-year-old International Property Awards, widely considered one of the most prestigious awards in the world.-

Vietnamese exports to Italy surge in January

Vietnam exported almost 249 million USD worth of commodities to Italy in January, an annual increase of 36.39 percent, according to the Information Centre under the Ministry of Industry and Trade.

Major exports included phones and phone components, footwear, and coffee, growing between 14 and 66 percent from January last year.

Trade between Vietnam and Italy has increased steadily by 25-30 percent annually, hitting 3.6 billion USD in 2014.

The figure is expected to reach 5 billion USD in 2016, as the southern European nation is now an important export market for Vietnam.

Vietnam, Singapore enjoy strong trade growth

Bilateral trade between Vietnam and Singapore continued to experience strong growth during January, hitting 2.178 billion SGD (1.577 billion USD), a year-on-year increase of 5.2 percent, says Singapore Department of Statistics (DOS).

Vietnam’s exports to the partner rose by 6.2 percent against the same period last year to 458 million SGD (331.6 million USD).

Some key export products maintained high growth, for example, oil and gas amounting 133 million SGD (96.3 million USD) while several faced a drop, including coffee and tea, down 51.4 percent to 11.2 million SGD (8.1 million USD), and seafood, down 13 percent to 7.2 million SGD (5.2 million USD).

Meanwhile, Singapore shipped to Vietnam 1.72 billion SGD (1.24 billion USD) worth of commodities with the bulk of its products seeing a jump during the period, notably beverage, up 192.5 percent to 87.4 million SGD (63.3 million USD), chemicals, up 182 percent to 31.8 million SGD (23.02 USD), and telephones and components, up 146.3 percent to 680 million SGD (492.3 million USD).

Of the imports, made-in-Singapore products accounted for 621 million SGD (450 million USD), increased by 5.8 percent).

Can Tho city eyes 1.45 billion USD in exports

The Mekong Delta city of Can Tho will accelerate exports of eight major products in a bid to generate 1.45 billion USD in export revenue this year, according to the municipal Department of Industry and Trade.

The eight products in question are rice, aquatic products, processed agricultural goods, textiles and garments, pharmaceuticals, leathers, fine arts and handicrafts, with rice, aquatic products, and textiles and garments as the largest commodities.

To boost rice shipments, Can Tho plans to help businesses apply modern processing and packaging line technologies to improve rice quality and gain access to strict markets like the EU, Japan, and North America.

It will revamp processing firm operations and re-organise the rice purchasing, processing and preserving system. It will encourage companies to buy at least 700,000 tonnes of rice produced by local farmers and source rice from neighbouring provinces with the ultimate aim to export 850,000 tonnes in 2015, the department said.

The city will simultaneously work to tighten control over aquatic product quality, enhance trademark development, work directly with foreign partners without intermediaries, and expand production scale to minimise costs and meet foreign demand.

High-quality product manufacturing will be strengthened with additional focus on processing shrimp, especially global favourites black tiger shrimp, frozen fish, and instant packaged mollusc.

Assistance will also be provided for seafood processors in training personnel, improving communication skills in foreign trade relations, and expanding partnerships with firms in Denmark, Sweden, the UK, Belgium, the US, Australia, Singapore, and Indonesia.

The department added that Can Tho is now striving to raise the localisation rate of its apparel products by 5 percent to 55 percent, modernise the sector, and develop human resources both quantitatively and qualitatively, boosting competitiveness and integration capacity.

It will divide its markets into ‘strict’, including the EU and the US, and ‘less strict’ like the Republic of Korea, Angola, and India, to determine relevant product designs.

Promotional activities will be stepped up in Vietnam and internationally with the aim to sell 8 million apparel items in traditional markets such as the EU, the US, the Republic of Korea, and Japan, and 1 million items in new markets like India, Canada, New Zealand, Australia, and the Middle East.

In the first two months of 2015, the city earned 147 million USD in exports, down 5.8 percent annually, with several exports recording sharp revenue decreases such as handicrafts (down 64.7 percent), rice (13.2 percent), and seafood (11.2 percent).

Vietnam seeks to tax e-commerce, Facebook retailers

A draft circular that envisages requiring online retailers to register with the ministry and pay taxes has drawn mixed reviews.

The Ministry of Industry and Trade circular would require e-commerce and social media site retailers to register their transactions in order to facilitate the collection of taxes, starting on January 20, 2015.

The regulation attracted broad public attention in Vietnam, where online shopping has recently flourished.

Many have questioned the extent to which the regulation is feasible.

Tran Thanh Hai, general director of Vietnam Gold Business, said it is not easy to tax retailers who use sites like Facebook because the host server is outside Vietnam and the retailers may be based overseas.

These individuals can shut down problematic Facebook pages at any time and the authorities can’t track down their owners or operators, he said.

Lawyer Nguyen Thanh Ha, chairman and CEO of S&B Law, said millions of people sell goods online using anonymous accounts, making it very hard to regulate their activities.

Developed countries with better IT infrastructure are more capable of monitoring and regulating such activity, he said.

But Nguyen Thi Thanh Nhan, the owner of Nang Ganh (a popular online restaurant in Ho Chi Minh City), hailed the regulation as “necessary” since it will protect consumers and businesses alike.

“When the sellers register with the trade ministry, they can be held responsible for their products and services, so customers will be better protected and served,” she said.

She said that many Vietnamese consumers have recently lost trust in e-commerce after receiving something that's of lower quality than what they viewed online.

In order to tax sellers, the trade ministry must gather information about individuals or organizations who opened accounts to run online retail businesses from the Ministry of Information and Communications, a Ministry of Finance official told Thanh Nien.

At the same time, commercial banks must monitor online shopping revenues and deduct taxes from such transactions, he said.

Le Thi Thu Huong, deputy head of the Ho Chi Minh City Tax Department, said that in order to make the regulation feasible, the ministries of trade and information, the banks, and the tax departments must work together closely.

The Ministry of Industry and Trade said it is still polling public opinions about the circular before officially issuing it.

Rambutan mango, longan exports surge

Two month- exports of dragon fruits, rambutans, mangoes and longans to the four demanding markets-the US, Japan, the Republic of Korea (RoK) and New Zealand swelled 25.8% to 945 tonnes.

According to the Plant Protection Department (PPD), dragon fruits exports, accounted for 80% of total export turnover. The US remained the biggest importer of dragon fruits with 450 tonnes, trailed by Japan and the RoK.

Local businesses predicted that fruit exports to the lucrative markets this year will pick up as longans and lychees are shipped to the US.

Mango exports to the RoK showed positive signals with 46.8 tonnes of mango exported to the market, equal to last year’s figure.

The PPD said this year the country is set to ship more mangoes and star apples to the US, lychees, mangos and dragon fruits to Australia and mangoes to Japan.

Hongkong Land, Sumitomo back out of Vietnam ‘golden’ property project

Authorities in Ho Chi Minh City have allowed UK-owned Hongkong Land and Japan's Sumitomo Realty & Development to withdraw from a coveted property project at one of the best locations in the city downtown.

Local media reported on March 5 that it is unclear why the companies wanted to quit the US$331.3-million-plus project, less than two years after securing land rights in July 2013 following a competitive bidding process.

Upon the land assignment, the city's authorities said if the investors failed to carry out the development without justifications, they would lose their deposits and would be banned from bidding for other projects within three years, news website VnExpress said.

They were not allowed to transfer their contracts to another investor either, it added. In the meantime, authorities said they will to organize a tender to choose new investors.

The city’s plan was to have a complex including a shopping mall, a hotel, a financial center and a gallery built on the 9,800-square-meter land on Dong Khoi Street in District 1.

It is often dubbed a “golden” lot of land because of its sought-after location. Under the original plan, a total of over VND7.16 trillion would be invested in the project. Around half of that amount was believed to be earmarked for land-related costs alone.

Nearly 70 investors expressed their interest when the project was first announced in 2009.

Coffee hoarding: Vietnamese speculators pressure global robusta deficit

Vietnamese speculators are stashing away bags and bags of robusta, a caffeine-rich bean used in instant coffee and blends.

The hoarding, the scale of which traders have never seen before, has cut exports and threatens to deepen a global deficit.

People in the market say that in recent weeks speculators - ranging from traders in fertilizer and petrol to government employees with idle funds - have been stocking up on beans whenever prices dip below psychologically key levels.

"When prices are below VND40,000 (US$2) per kg, purchases for speculation happen," said Do Ha Nam, deputy chairman of the Vietnam Coffee and Cocoa Association.

The hoarding may cut Vietnam's international robusta shipments in March for the second consecutive month, worsening a wider shortage.

In October-February, exports fell 11% from a year earlier to 8.94 million bags. Even if March exports match February loading, shipments in October-March would still be around a quarter less than a year prior.

The downtrend in exports could increase a global deficit that some estimates hold may be the deepest in almost a decade.

Domestic robusta prices climbed to a seven-week high of VND41,100 per kg on Feb. 24. But speculators did not take the bait, reckoning the market could rise to VND45,000, following a disappointing 2014/2015 crop ravaged by dry weather and disease.

Traders say speculators may not release their stocks until late May or even June, when rains are expected to arrive in the Central Highlands coffee belt. Rains would bode well for the 2015/2016 crop, replenishing inventories and lowering prices. Speculators would have less incentive to hoard.

The smaller 2014/2015 harvest in Vietnam, on top of lower yields in Brazil and Indonesia, may lift benchmark ICE robusta futures to US$$2,115 a tonne by the end of calendar 2015, according to a Reuters poll in January.

That is more than 10% above current prices. But it is premature to say if a cup of instant coffee would cost more this time next year.

The hoarding in Vietnam has made it difficult to gauge the volume of beans left unsold in the country and forecast their impact on the wider market when the speculators release their stocks.

It is also too early to assess the size of the next crop due for harvest in October, traders say. (US$1 = VND21,320)

Banks cut rates on the back of low CPI

Deposit interest rates are set to fall across the board for the local banking sector, including a prediction that there should be a cut in a open-market operations interest rates to at least 4.5 % a year by the end of 2015.

Eximbank, for instance posted a new deposit rate of 7.5 % a year instead of the previous 7.7% for deposits upward of VND500 million (US$23, 364). The bank’s 12-month term deposit was recorded at 6.1% per year, a significant fall of 0.28% a year. Meanwhile, its six to 11-month term deposit rates also fell 0.1-0.18% a year and one-month term deposit rate dropped a marginal 0.08 % a year.

Techcombank also cut deposit rates by 0.1-0.3% a year while the Saigon Commercial Bank (SCB) trimmed its deposit rates down 0.1-0.2% a year and according to a SCB representative, the deposit rates were likely to fall further in the future.

According to the socio-economic reports for February and the first two months of 2015 by the Ministry of Planning and Investment (MPI), the consumer price index (CPI) in February decreased 0.05% compared to January and 0.25% compared to last December.

The figure however increased 0.34% in comparison to last February. On average, the CPI for the first two months crept up just 0.64% compared to the same period last year.

Declining inflation therefore has provided very favourable conditions for interest rates cuts while still maintaining rates sufficiently attractive to maintain deposits.

SCB general director Vo Tan Hoang Van said that given the current stable macro-economic state, steep declines in input costs and with bad debts under control, cutting interest rates was totally acceptable.

Meanwhile, HSBC expressed the view that the State Bank’s (SBV) monetary moves in recent years, particularly its open market operations (OMO), would determine whether the interest rate was likely to be further trimmed in the coming months.

HSBC chose the OMO as it carried adequate historical data and impact with regard to the short-term interest rate in the market. According to HSBC, the real interest rate had in fact increased in recent months; and the bank therefore predicted that the SBV would be likely to cut the OMO by another 0.5% down to 4.5% by the end of the year.

“We expected that the SBV will announce another 0.5% OMO interest rate cut and it could be as soon as this week”, said HSBC Asia Economist Trinh Nguyen.

“However, there are uncertainties that the SBV could be cautious in its operations decisions including the precarious oil and gas prices, the likelihood of the Federal Reserve increasing interest rates this year and whether demand becomes more stable.

In addition, in the second half of the year, there should be unfavourable price conditions awaiting”, added Nguyen.

Market abuse a concern as Vietnam mulls sales of airport terminals

Vietnamese experts have begun to voice their concern about potential market abuse that may arise from the government's plan to open up the aviation sector.

As the transport ministry is considering selling the rights to operate major airport terminals, experts say it is vital to have regulations to protect consumers.

They fear that once a company has been allowed to take over a certain terminal, it will try to capitalize on its market monopoly.

Earlier this week, Vietnam Airlines offered to buy Hanoi’s sole domestic terminal at Noi Bai International Airport.

The state-own carrier was the second airline to make such an offer, after low-cost carrier VietJet Air.

Economist Nguyen Van Ngai said privatization does not necessarily mean giving one investor the license to operate a complete terminal.

The ministry should consider selling operating rights to different investors, which is the best way to protect airport terminals from being monopolized, he suggested.

Bui Trinh, another economist, also said if the ministry allows a single investor to become the sole manager of a terminal, it will look like the state allows that investor to have a monopoly.

He and many other economists urged the ministry to introduce regulations, including those related to service quality, so that investors are legally bound to operate terminals exactly as they have promised to.

Without clear regulations, the privatization of airports can lead to bad consequences, particularly risks that an airline with management rights will "bully" other carriers, economist Le Dang Doanh said.

He said the transport ministry must take national security and consumer interest into account when creating legal mechanisms for privatization.

Dinh Xuan Thao, chief of a policy research institute under the National Assembly, said it is also important to evaluate the terminals and decide how much they should be sold for, so that the state will not suffer losses.

The prices must be publicized, he said.

Tran Huu Huynh, chairman of Vietnam International Arbitration Center, agreed, saying investors must be chosen through public and transparent calls for bids.

Vietnam needs to learn from other countries that have already succeeded in privatizing their airports, Huynh said.

Under a tentative plan, the transport ministry wanted to transfer the rights to operate a number of terminals at major airports, including Noi Bai, Cam Ranh near the central resort town of Nha Trang, and Danang, in order to attract more funds into the aviation sector.

It also considered putting the sole airport on the resort island of Phu Quoc up for sale, as a whole.

The privatization plan is now being drafted by the Airports Corporation of Vietnam, which currently manages 22 international and domestic airports across the country.

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