Work starts on coated glass factories in southern province

NSG Vietnam, a subsidiary of NSG Group of Japan, kicked off construction of two factories producing transparent conductive oxide (TCO) and ultra-fine flat (UFF) glass in the southern province of Ba Ria Vung Tau on September 6.

Located at the My Xuan A Industrial Park in Tan Thanh district, the two factories will be built at a total cost of $232 million.

The TCO glass factory will be the eighth of NSG Group and the second in Vietnam.

Once completed, the two factories are expected to provide jobs for 500 local technical workers, said Shingo Isshiki, NSG Vietnam legal representative, adding that most of their products will be exported.

NSG Group is a world leading producer of float glass used in buildings, cars and screen equipment with a network of 52 factories throughout the globe.

Moon cake producers hit sales targets

Famous moon cake brand producers, despite slow sales at the beginning of the season, have reached or surpassed their targets due to this year’s higher consumption of corporate customers.

Representatives of many popular cake makers such as Kinh Do, Bibica, Givral and ABC Bakery told the Daily that they had all completed their sales targets as planned.

Le Van Thinh, deputy director of the sales department of Kinh Do, said the company had sold 2,100 tons of moon cakes, 5% above this year’s plan and an increase of 5% from last year. ABC Bakery also surpassed its target with an increase of 20% due to recent strong demand.

Similarly, a year-on-year rise of 30% was recorded at Givral before September 2 while Bibica recorded higher sales this year with 500 tons more than its target sold.

Moon cake consumption in the early season was slow but increased in the ten days before National Day, according to Givral.

Nguyen Thi Hong Thuy, from a local cake maker, said she just expected the same level of sales as last year due to tough economic conditions but the firm had already reached its target and sales were still on the rise.

This year’s high moon cake demand of corporate customers led to strong buying, which was evident in the strong sales growth at most moon cake makers.

Local firms explained that they would give moon cakes as a traditional gift to staff to try to alleviate employees’ concern because of the stagnant trade this year.

Luu Quy Phuong, from Saigon Paper Corporation, said employees with children, which accounts for 50% of its staff, would be given moon cakes, lanterns and toys. The company would also organize activities for its workers in the upcoming Mid-Autumn Festival.
 
HCMC to get animal feed plant

Japanese firms Sojitz and Kyodo Shiryo recently confirmed a joint investment of 2 billion JPY yen ($26 million) into building an animal feed processing plant in the outskirts of Ho Chi Minh City .

The plant is expected to be operational by April 2013 and have a total processing capacity of nearly 200,000 tonnes per year.

By 2020, the joint-venture plans to control a 10 per cent market share in supplying cattle feed to Vietnam, based on revenues expected to have reached 80 billion JPY ($1.04 billion) annually.

Domestic garment exports surge

Vietnam 's garment exports fetched over $8.95 billion in the first eight months of this year, rising by 29.2 per cent over the same period last year, according to the Vietnam Textile and Garment Association (Vitas).

Vitas attributed the good performance to the abundance of contracts won by local producers.

With current export growth, the garment and textile sector will likely exceed this year's export turnover target of $13 billion, reaching $13.5 billion instead, Vitas said.

The past few years have witnessed a shift in garment orders from China to other countries, a tendency that went up sharply since the beginning of this year with Vietnam receiving the highest number of garment orders in the world, said the HCM City Textile, Embroidery and Knitting Association chairman Pham Xuan Hong.

Nha Be Garment Corp general director Pham Phu Cuong said that his company had managed to generate $50 million from exports in the first eight months of this year, in part attributable to increasing efforts in fulfilling FOB (Free on Board) orders from foreign clients, bringing in $30 million in export turnover.

Dong Nai Garment Corp (Donagamex) announced that it had received export orders at prices that had risen by 15-20 per cent compared to 2010, enabling an export target of $45 million for this year (an 18 per cent surge).

While increasing orders offered local garment enterprises a chance to increase production capacities, in order to fulfil these orders, it was vital that firms keep their workforces stable, especially in terms of skilled labour, experts said.

Labour quality remained a leading concern, agreed Donagamex General Director Bui The Kich.

Donagamex, currently employing 3,000 workers, has struggled to manage its workforce in order to effectively increase productivity alongside rising production costs.

A well-managed labour force could help reduce pressure brought on by increasing costs, Kich confirmed.

Dong Binh JSC said that it still lacked 100 employees for its garment plant in northern Bac Ninh province.

Along with difficulties caused by the global economic downturn, poor purchasing power as well as increasing electricity, coal and petroleum costs, labour shortages have caused difficulties for garment enterprises, said the company's general director Tran Van Khang.

Agricultural imports rise 23 per cent

Vietnam saw a year-on-year increase of 22.6 per cent to $10.4 billion in the first eight months of this year in imports of material for production and processing and finished products for the farming, forestry and seafood industries, said the Ministry of Agriculture and Rural Development.

The increase was due to a large surge in the import prices for materials and finished products used by these sectors, the ministry said.

Fertiliser saw the highest increase in import volume and value during the period, the ministry said. Volume surged by 31.1 per cent to 2.6 million tonnes and 64 per cent in value to $1 billion.

Rubber products followed, with the country boosting imports by 40 per cent in volume to 248,000 tonnes and by 56.7 per cent in value to $613 million against the same period last year. The average import price during the eight months jumped by 41.3 per cent in comparison with the same period last year.

The ministry said pesticide imports had a year-on-year surge of 22 per cent in value to $412 million.

Import value for wood and wood products increased by 16.4 per cent to $835 million while the figure , for animal feed was $1.6 billion, equipvalent to 5.8 per cent increase.

Le Ba Lich, chairman of the Vietnam Animal Feed Association, said the animal feed industry must import a huge volume of material every year for processing at an average value of $3 billion.

Therefore, the price of animal feed was always higher here than in other countries, making it difficult for Vietnam's livestock industry to compete with similar products made in other countries, Lich said.

Pham Tat Thang, an economic expert at the Ministry of Industry and Trade's Institute for Trade Studies, said material and product imports for the farming sector would continue in the near future because most key products in the farming sector, such as fertiliser, had to be imported.

Initially, the farming, forestry and seafood sectors should apply modern measures and technologies to produce high value-added export products to reduce the trade deficit, Thang said.

But for the long term, the farming, forestry and seafood sectors should prioritise the expansion of material production for the domestic processing sector and finished products for local consumption, he said.

Exports to Japan fetch $5.4 billion in seven months

Vietnam’s exports to Japan reached $5.4 billion in the January-July period, a year-on-year rise of more than 30 per cent.

The figure accounts for 10.4 per cent of the country’s total exports turnover. Japan is the Southeast Asian nation’s second biggest importer, after the US, and it currently imports many key Vietnamese products, such as rubber, minerals, garments and textile, seafood, electric wires and cables, and footwear.

Textiles and garments continued to generate the largest revenue in the period, with $859 million, up 47.2 per cent, thanks to the Vietnam-Japan Economic Partnership Agreement which took effect in October 2009, that gives Vietnam’s textiles and garments exports to Japan a zero percent tariff rate, Japan is now the third largest importer of the items, after the US and the European Union.

Crude oil comes second with an export value of nearly $716 million, almost six times over the same period last year.

Meanwhile, footwear exports brought home a turnover of $150 million, an increase of 58.3 per cent.

Exporting to Russia with love

Industrialists are looking to boost Vietnam’s poor rate of exports to Russia.

According to the Ministry of Industry and Trade’s European Market Department head Dang Hoang Hai, two-way trade values between Vietnam and Russia stood at $2 billion in 2010.

“The bilateral trade relations between Vietnam and Russia are below expectations when compared to the trade value between Vietnam and a small country within the European Union coming to $4 billion per year,” Hai said.

Russian trade office representative in Vietnam Kardo Sysoev Alexander attributed the two countries’ limited trade exchanges to product poor diversity and geographical distance.

Local exporters, however, said procedural hindrances were the core reasons behind poor bilateral trade.

Pharmaceutical manufacturer Mekophar representative said Russian partners often demanded various kinds of certificates in Russian language granted by Vietnamese competent agencies from exporters.

Thu proposed local certification bodies enact dual language certificates to help firms.

Vinh Long Import Export Joint Stock Company (Imex Cuu Long) representative said it was difficult for preliminarily processed agricultural produce to make a foray into the Russian market since the Russian food security body bars the import of such items.

To help bolster export to Russia, Vietnamese relevant authorities were negotiating a mutual recognition agreement with Russia, according to MoIT’s Dang Hoang Hai.

“The agreement would have been signed in November 2010 but it faced delays,” said Hai.

According to Hai, in 2011 the MoIT would complete the Vietnam-Russia free trade agreement (FTA) pre-feasibility study.

The two governments would embark on negotiating the FTA issues from early 2012 and strive to ratify the agreement two years later, Hai said.

Alexander said Vietnamese firms should take initiative to voice their problems at the forthcoming 15th Vietnam-Russia Intergovernmental Committee in October as reality shows that many business impediments were addressed at the committee meetings.

From the business community, deputy general director Ngo Viet Hoai at Ba Ria-Vung Tau Seafood Processing Import Export Joint Stock Company suggested local exporters seek Russian partners through attending international exhibitions and try to sign a ‘principle’ contract with Russian food quality control body.

“The Russian body and partners will then come to check Vietnamese partner production factories in Vietnam and give a certificate for export to Russia carrying the Russian importer name if they find the Vietnamese factories up to scratch. Exports to Russia will then be simple if Vietnamese firms acquire such certificates,” Hoai said.

Vietnam oil refinery to resume full production next week

Dung Quat Oil Refinery in the central province of Quang Ngai will resume its full production next Monday, three days ahead of deadline, after the first comprehensive maintenance lasting nearly two months.

Vu Quang Nam, deputy general director of PetroVietnam, said Binh Son Refining and Petrochemical Co., a unit of PetroVietnam, had operated some production workshops with a capacity of 70% so far and two workshops were still under maintenance.

The Dung Quat plant, set to have a second maintenance in four years’ time, has refined and produced over 3.3 million tons of oil, earning total revenue of VND68.7 trillion and paying VND8.8 trillion in taxes to the State.

The maintenance was performed with the participation of around 3,600 workers and experts from Binh Son Refining and Petrochemical Co. and some experts from South Korea and Singapore at a total cost of US$25 million.

Dung Quat Oil Refinery, with total investment of US$3 billion and a designed processing capacity of 6.5 million tons per year, has met around 30% of domestic fuel demand.

The refinery was built in mid-2005 by a Technip-led consortium and was completed after 44 months of construction and a test run in February 2009.
 
Gold put on price risk management list

The HCMC Customs Department has placed gold on the price risk management list to thwart any attempts by exporters to falsify price statements for tax evasion.

Domestic traders, for instance, are required to present bills and invoices proving origins of jewelry before exporting the bullion and let customs officers assess jewelry quality if volume is large and export activity is unscheduled. After that, the customs department will compare the result with the world market’s price at the time of exporting to check the accuracy of the firms’ price declaration.

Nguyen Ngoc Que Chi, general director of Sacombank Jewelry Co., (SBJ), said the decision was acceptable, since the price of gold had been strongly volatile. If local traders cheat on price on purpose, tax collections will be impacted accordingly.

Only jewelry having a high gold content, between 80 to 99%, has a tax rate of 10% imposed and is treated as goods whose price needs to be closely managed, Chi explained. Meanwhile, gold bars containing gold volumes higher than the regulated level and allowed for export by the central bank are not taxed and thus, not grouped into the list.

A source from the customs department said this is one of the measures to tighten raw gold jewelry export activity as stipulated by the Ministry of Finance.

So far, the raw gold jewelry volume shipped to other countries from the city has surged, considerably reducing gold holdings at home.

In the first seven months of the year, the whole nation’s gold jewelry exports reached around 40 tons, of which the city accounted for up to 70%.
 
Seafood export poised to beat target

Vietnam’s seafood export this year is expected to exceed the annual target by 10% to hit US$5.5 billion compared to last year’s US$5.2 billion, the Vietnam Association of Seafood Exporters and Producers (VASEP) said on Monday.

Truong Dinh Hoe, general secretary of VASEP, said during an online meeting held by the Ministry of Industry and Trade that the country had earned US$3 billion in the January-August period, up 5% in volume but some 20% in value year-on-year.

Hoe attributed the robust growth to strong export earnings from shrimp and tra fish as well as better prices this year.

Earlier, Vietnam set the year’s seafood export target at US$5 billion compared to last year’s value of US$5.2 billion in anticipation of difficulties ahead, as overseas demand was predicted to fall, especially in debt-hit Europe and the U.S.

However, Hoe said tra fish material sources began running out after the harvest season. Therefore, the need for tra fish material is rising again, causing the local price to surge to over VND25,000 per kilo in the Mekong Delta.

The scarcity in tra fish will continue until the end of this year before the supply is replenished again upon the new harvest in early 2012, affirmed Hoe.

Meanwhile, shrimp export will be stable this year, with an estimated export revenue of US$2 billion for the whole year owing to a surge in white-legged shrimp output.

The massive death of prawns caused by diseases is compensated for by a steep rise in white-legged shrimp output, according to VASEP. Experts said white-legged shrimps will become the substitute for prawns owing to high productivity.

The volume of white-legged shrimps for export this year is forecast to increase by 30% to around 200,000 tons, while that of prawns will decline to 300,000 tons from 350,000 tons last year, Hoe noted.

The general secretary of VASEP also noted more favorable trade conditions for Vietnam’s seafood this year besides better prices.

He noted the U.S. Department of Commerce (DOC) this month announced the result of its review on the antidumping tariffs slapped on Vietnam’s shrimp, with the new tariffs slashed sharply, thus bolstering Vietnam’s shrimp export stateside.

For instance, Minh Phu Co. is now subject to a tax rate of 1.15%, instead of 2.95% as earlier when shipping the seafood to the U.S., while Nha Trang Seafood Co. enjoys 0% compared to the previous 4.89%, and that on Camimex is decreased to 0.83% from the previous 3.92%.

Similarly, the remaining 28 businesses also have the tax reduced to 1.04% from 3.92%.
 
Phu Yen licenses two tourism projects

The central province of Phu Yen province, at an investment promotion conference attended by over 100 foreign and local investors last week, presented investment certificates to two tourism projects.

Xuan Thien Co. from Ninh Binh Province will spend VND18,405 billion building a high-end resort while HCMC-based Tan Viet An Co. will develop an eco-tourism site worth VND150 billion in Song Cau Town.

At the conference in HCMC, the province also gave approval in principle for Vinpearl to make a detailed zoning plan for Dam O Loan Resort that will require total capital of VND11 trillion and for another company to build a complex of beach resort and water park.

The province has attracted 37 foreign-invested projects capitalized at US$6.4 billion and 223 local projects valued at VND50,856 billion, according to the provincial Department of Planning and Investment.

Phu Yen is home to a couple of big-ticket projects, such as the US$1.7 billion Vung Ro oil refinery project, and a US$4.3 billion luxury resort complex.

Provincial authorities are also calling for more investments in 31 projects worth US$4.1 billion, including South Phu Yen Economic Zone, Hoa Tam Petrochemical Industrial Zone, Bai Goc Port, and a rail line from Tuy Hoa City to the Central Highlands.

Investment Law found inadequate

Experts of a group mandated to review economic laws on Tuesday criticized the Investment Law as inadequate and even overlapping other legislations.

Professor Nguyen Mai, chairman of the Vietnam Association of Foreign Invested Enterprises, stressed the need of adjusting the law to fit present situations due to much inadequacy it contained.

The Investment Law, having ten chapters and 89 articles, was issued in 2005 on the basis of combining foreign and domestic investment laws, aiming to create a level-playing field for all enterprises. Policy makers then regarded the law as one of Vietnam’s most liberal ones.

However, the law contained and mentioned too many things, said Professor Mai, an investment policy-making expert, at a conference held on Tuesday by the Vietnam Chamber of Commerce and Industry (VCCI).

“Domestic and foreign investments are different, so are public and private investments. However, they all are put together in a single law,” he explained.

Meanwhile, lawyer Pham Chi Cong from law firm Khai Phong, said the Investment Law overlapped many other related laws, including the Enterprise Law, Securities Law, Land Law, Trade Law, and Intellectual Property Law among others. He questioned the need of having the Investment Law as a separate one.

Besides, the investment certificate should be omitted under present conditions as it did not affect the State management, Cong added.

Phan Duc Hieu, a member of Investment Law reviewing team, said the legal value of investment certificates not clear. The certificate is part of the law but it gives no value to the State as well as investors.

All opinions on the Investment Law will be collected in a report and then presented to the National Assembly, Government and ministries at the end of this year.
 
IDICO awarded highway overpass project in city

IDICO Investment Consultancy Joint Stock Company will invest over VND704 billion to build two overpasses over the HCMC stretch of National Highway 1A to ensure smooth traffic on this busy highway.

The HCMC Department of Transport last week presented an investment certificate to the company and both sides signed a built-operate-transfer (BOT) contract for the two flyovers.

One of the overpasses will pass through Provincial Road No.10 with a total length of 800 m and the other through Provincial Road No.10B with a total length of 680 m.

They will help reduce pressure on traffic at the intersections between National Highway 1A and the two provincial roads, cope with rising road accidents there, and improve transport infrastructure between the downtown area and Beltway No.2, said Tran Quang Phuong, director of the HCMC Department of Transport.

Work on the project will start in the fourth quarter of this year and be completed in mid-2012.

An Lac-An Suong section of National Highway 1A is a part of HCMC’s Beltway No.2 and has eight lanes. Many small roads that lead to industrial parks cut through this highway section, frequently causing traffic jams and accidents.
 
Vincom to build tunnel link with metro line

Vincom Joint Stock Company has got the go-ahead to build a tunnel link with the terminal of Metro Line No.1 in downtown HCMC, according to the HCMC Department of Construction.

Nguyen Van Hiep, deputy director of the department, said the tunnel would start at Vincom’s commercial, apartment, service and hotel complex under construction at a site surrounded by Dong Khoi, Le Loi, Nguyen Hue and Le Thanh Ton streets.

Metro Line No.1, worth US$1.09 billion, runs from Ben Thanh Market in District 1 to Suoi Tien in outlying District 9. Its underground section is 2.6 kilometers long with the terminal at Quach Thi Trang Roundabout.

The city will consider constructing more tunnels connecting high-rise structures and metro stations in the future, said Hiep.

PV