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10 products participate in US$3bln export club; Textile firm raises VND119 billion from IPO; HCM City targets 13 percent credit growth rate in 2015; Seafood exports to US hit record high; More conditions for rice exporters

10 products participate in US$3bln export club

Ten items joined the US$3 billion export club in 2014, together making an export turnover of US$104.14 billion, accounting for 69.3% of the total and representing a rise of 13.9% from 2013.

Those witnessing high growth rate included garment up 16.8%, footwear up 23.1%, aquaculture up 17.1%, machines, equipment and tools up 21.4% and coffee up 30.9%.

Among the 10 items, six belonged to the manufacturing and processing industry, three in the agricultural-forestry-aquaculture sector, and crude oil.

The nation recorded 10 localities having export turnover exceeding US$3 billion in 2014, seeing  three more new provinces of Thai Nguyen, Long An and Ba Ria-Vung Tau.

These 10 localities posted a total export turnover of US$116.15 billion in 2014, accounting for 77.3% of the total.

The southern province of Binh Duong announced the highest trade surplus of US$3.86 billion, followed by the northern provinces of Bac Ninh and Thai Nguyen with US$3.35 billion and US$1.2 billion, respectively.

Viet Nam gained US$95.32 billion from exporting to 12 markets in the US$3 billion export club. The US, China, Japan and the Republic of Korea remained the largest exporters of the nation.

In 2015, an ASEAN Economic Community (AEC) will be formed, allowing Viet Nam to restructure its export and import markets and increase the competitiveness.

In 2014, Viet Nam’s export turnover to ASEAN nations reached more than US$19.12 billion, much higher than the figure of US$1.112 billion in 1995.  

The nation signed Free Trade Agreements (FTA) with the EU, the Republic of Korea and the Customs Union of Russia, Belarus and Kazakhstan this year, expecting that these will push the country's deeper global integration.

Textile firm raises VND119 billion from IPO

Textile firm Minh Khai under Hanoi May 19 Textile Group (Hatexco) mobilized nearly VND119 billion from the sale of over 1.6 million shares at its  initial public offering (IPO) at the Hanoi Stock Exchange last Friday.

Thirty investors bid for more than 26.7 million shares at the IPO auction, 16 times higher than the volume put up for sale, according to Vietnam News Agency.

Notably, an investor wanted to acquire all the offered volume at the highest bid of VND72,000 per share, seven times higher than the starting price of VND10,100 each.

Closing the auction, three individual investors bought all the 1.6 million shares with the average winning price of VND71,991 per share, and Minh Khai Textile Factory raised earned VND118.7 billion from the auction.

Fuel firms report profits despite price plunge

Local fuel traders Comeco and Saigon Fuel Joint Stock Company (SFC) have announced strong profit rises in the final quarter of last year although fuel prices have tumbled since last July.

Comeco’s net profit reached VND13.95 billion, a year-on-year surge of 126.5%. Overall, its net profit amounted to more than VND42 billion for all of last year, up 66% against 2013.

However, Comeco’s revenue was lower than in the fourth quarter of 2013. Le Tan Thuong, general director of Comeco, attributed the revenue drop of 6.02% to the shrinking fuel prices.

Meanwhile, SFC’s unaudited net profit exceeded VND10.5 billion in the fourth quarter of last year, doubling that of the previous year’s same period. Overall, its net profit surpassed VND37.2 billion for the whole year versus 2013.

Similar to Comeco, SFC’s revenue went down in October-December compared to the same period of 2013 due to lower fuel prices than those recorded in the final quarter of the previous year.

Both SFC and Comeco buy products from wholesalers for distribution and earn discounts offered by those wholesalers.

As reported by the Daily, the discount rates ranged from VND800 to up to VND1,200 per liter in the final quarter of last year. The wholesalers offered high discount rates in order to woo fuel retailers on dropping retail prices.

HCM City IPs told to welcome major apparel projects

The authorities of HCMC have urged the industrial parks (IPs) to attract major projects in the textile and garment sector despite the city’s restrictions on labor-intensive projects.

Tran Viet Ha, head of the Investment Management Department of the HCMC Export Processing and Industrial Zones Authority (Hepza), explained the world’s apparel industry is forecast to grow strongly.

The Trans-Pacific Partnership (TPP) agreement could be concluded this year, offering great opportunities for companies in the industry to benefit from zero tariffs on apparel exports to TPP member countries.

Projects in the textile and garment sector need a lot of labor but experts said as apparel is a major export earner of Vietnam, it is one of the countries to benefit most from the opportunities to be brought by the multilateral trade pact.

Therefore, Ha said some IPs such as Hiep Phuoc and Dong Nam have opened their doors to apparel projects, Ha told the Daily on the sidelines of a recent meeting of Hepza in the city.

Ha said projects in the textile and garment sector licensed by Hepza produce luxury items and use modern technology.

Among the apparel projects licensed in the past year is Worldon Vietnam Ltd. Co. in Dong Nam IP. It has recently increased its pledged investment to US$300 million from US$140 million.

Ha said the Worldon Vietnam project, which also has a design center, makes products for world-known brands such as Nike, Adidas and Puma. The investor needs an area of 52 hectares and 7,000-8,000 employees.

Forever Glorious of Taiwan’s Sheico Group has pledged US$50 million for a project to produce almost everything from fiber to finished garments, with a work force of more than 3,500 people at Dong Nam IP.

Last year, the IPs and export processing zones (EPZs) in the city saw a year-on-year fall of a slight 4.39% in foreign direct investment (FDI) approvals at US$347.5 million thanks to large-scale apparel projects.

Consumers pay the price

The country is shifting to a market economy in which market forces dictate consumer prices. This is evident in the 15 bouts of fuel retail price cuts since July last year in response to the world oil price plunge, which has in turn sent consumer prices in January diving 0.2%, a 17-year January low.

However, the consumer price index might have been lower if transportation service prices had been slashed in proportion to the fuel price reductions. Consumers are hoping for lower transportation prices as fuel costs account for around half of those prices. Surprisingly, transportation firms, including those providing taxi services, have shown little sign of making real concessions.

Consumers, economic experts and even authorities at local and central levels have frowned on the reluctance of transportation businesses to make a significant move. As the cup of endurance is over, Prime Minister Nguyen Tan Dung has intervened by ordering relevant ministries and agencies to inspect transportation fees to see whether they are overpriced. The Ministry of Transport will be coordinating with the Ministry of Finance to send out inspection teams at the request of the Government leader.

This is a clear indication that transportation businesses are not playing by the rules of the market. Given growing pressure, some companies in 43 of the country’s 63 cities and provinces have revised down their transportation charges but an insignificant range of 1-25%. The many firms that have kept their fees unchanged reason that in previous fuel price cuts, they already lowered fees, leaving little room for further reduction. This argument is not justifiable. Why? Because fuel prices have dropped 15 times but the number of fee cuts by transportation firms is neglectable.

Economist Dr. Ngo Tri Long describes the inaction of multiple transportation companies as unusual. He calls for pricing authorities to promptly conduct inspections and publicize all those businesses found to overprice their services, thereby stepping up pressure on them to act for the benefit of consumers.

Hopefully the Government intervention will end up preventing the consumer from paying the price for what is unacceptably overpriced.

PM decides specific mechanisms for Quang Ninh province

The Prime Minister has approved several economic mechanisms designed specifically for the northern coastal province of Quang Ninh and its Van Don economic zone.

Accordingly, Quang Ninh is allowed to establish a State-owned financial investment company following the model of Ho Chi Minh City to mobilise funds for infrastructure building. The provincial People’s Committee is to work on details of the company and submit the scheme to the PM for consideration.

The province will receive capital from the central budget and other sources to help with the construction of major local projects during 2015-2020 such as a road connecting Ha Long city with Hanoi-Haiphong Highway, the Ha Long-Van Don-Mong Cai Highway, Hai Ha seaport and environmental protection programmes in Ha Long and Bai Tu Long Bays.

Priority will be given to Quang Ninh in terms of ODA and preferential loans of donors to carry out several key projects in socio-economic development and environmental protection including the environmental protection plan in Ha Long City and urban development along the Greater Mekong sub-region corridor.

The government will also consider assisting Quang Ninh province in the form of Public-Private Partnership (PPP) to implement a number of important infrastructure projects.

Regarding local Van Don economic zone, the PM decided to include it in the list of coastal economic zones prioritized for development using State funding during the 2013-2015 period.

Besides general incentives applied for those economic zones, Van Don will be given priority in terms of ODA attraction for the construction of its key infrastructure.

Some infrastructure projects such as the Van Don airport, communication facilities, an international hospital and cross-island roads will receive investment from the State budget, government bonds and ODA capital.

Van Don, the biggest island in the northern region, was selected by the Vietnamese government to develop into a special administrative and economic zone. With its location in a corridor linking China and Southeast Asian nations, the island has easy access to other economic and political centres in Asia.

Dong Nai support industry earns 3.2 billion USD in exports

The annual export value of Southern Dong Nai province’s support industry reached 3.2 billion USD, according to the provincial Department of Industry and Trade.

Industrial parks in the province have attracted 422 Foreign-Direct-Investment (FDI) projects with a total capital of 6.9 billion USD to the support industry in various sectors including garments and textiles, footwear, electronics, auto and bike spare parts, and mechanics and equipment.

Support companies account for 23.5 percent of all enterprises and employ more than 200,000 employees—or 37 percent of those working in industrial parks.

The support industry continues to be the province’s priority for attracting FDI capital.

During the first 20 days of January, the province granted investment licences to two support industry projects worth one million USD.

So far, investment licences have been given to 1,473 projects with a combined capital of 26.19 billion USD.

Report announces cross-sector financial capacity improvement

Tourism, chemical, light industry and other cross-sector enterprises saw the highest improvement in their financial capacity, increasing by over 60 percent, as released in a report on the health status of businesses. “The 2014 Business Index – Corporate financial capacity”, published by the Institute of Business Studies & Development (INBUS) under the University of Business and Technology, was made public on January 27.

The report compares enterprises’ financial capacity across sectors and demonstrates their business performance improvement over the past year.

As many as 109 firms in transport, construction materials, mechanics, pharmaceuticals and healthcare services, garments and textiles, books and school equipment, construction, and minerals sectors increased by roughly 50-60 percent.

INBUS Head Nguyen Manh Quan said the institute will continue supporting businesses to enhance their performance in accordance with the international standard confidence index system (CIS) and Business Profile, as well as assisting in the international integration process.

The business index provides necessary information to stakeholders and reveals businesses’ contribution to their sectors and the economy, said President of the Vietnam Association of Accountants and Auditors Dang Van Thanh.

Central Highlands strive for socio-economic growth

In 2015, the Central Highlands aim to maintain social and political stability as well as enhancing economic growth, as said at a conference held in Buon Ma Thuot City, Dak Lak province on January 27.

To realise these targets, the regional steering committee has concentrated on monitoring the effective implementation of several local development projects. The committee has also called for more favourable policies to support major local products, particularly in agriculture, forestry and tourism.

It is working to devise an efficient mechanism to bolster the mobilisation of funds for transport and other public infrastructure improvements. Some of the region’s key projects include upgrading Pleiku airport and building the Ho Chi Minh road.

Managing migrant populations and properly handling shortcomings in hydropower projects are also key 2015 priorities.

In 2014, the Central Highlands’ total GDP increased by 8.74 percent with an annual export revenue exceeding 2.5 billion USD.-

Solutions for enterprises’ challenges in 2015

A workshop on 2015 challenges for enterprises was held in Hanoi on January 27 by ‘Dien dan Doanh nghiep’ (The Business Forum) newspaper to assess obstacles and limitations and seek solutions facilitating enterprise development in the context of increasing international integration.

Reports at the workshop revealed that small- and medium-sized enterprises (SME) in Vietnam, comprising 98 percent of total enterprises, are restricted in accessing loans and support from the government. In addition, reform progress in those businesses moves too slowly.

Dr. Vo Tri Thanh, Deputy Director of the Central Institute for Economic Management said that Vietnam struggles to participate in supply chains due to the small number of SMEs and large enterprises in relation to other countries.

However, he highlighted that Vietnam should work to stimulate innovation and cooperation with other countries to leverage its high potential in garments and textiles, leather footwear, fisheries, tourism and services.

Enterprises should familiarise themselves with the legal procedures of the integration process, Thanh said, adding that small-sized enterprises should collaborate with large businesses for capital access and efficient management.

Meanwhile, Nguyen Thi Thu Trang, director of the World Trade Organisation Centre under the Vietnam Chamber of Commerce and Industry, underscored that enterprises should focus on a number of issues including labour, the environment and the quality of products and services.

Apart from efforts made by enterprises, Deputy Director of the Business Development Department under the Ministry of Planning and Investment Bui Thu Thuy stressed the role of the government in simplifying loan procedures and promoting the establishment and utilisation of an SME development fund.

HCM City targets 13 percent credit growth rate in 2015

The State Bank of Vietnam’s Ho Chi Minh City branch has set targets of 13 percent credit growth rate, 12 percent deposit growth rate, under 3 percent bad debt ratio and better-than-last year business results in 2015, said the branch director To Duy Lam.

The banking industry will drastically implement the credit institution restructuring program and tackle bad debts, Lam was quoted by Saigon Giai phong newspaper as saying. They will focus on completing bank merger plans, he added.

Stating at the conference on January 26, permanent deputy Governor of the State Bank Nguyen Dong Tien instructed credit institutions to fulfill merger plans before June 2015 and keep close eyes on the progress to ensure that merged banks will stably operate in the second half of the same year.

In addition, Tien said that the banking system’s average bad debt has been under control.

In fact, many banks have a very low deep debt ratio--about 1 percent.

However, he said, the 3 percent bad debt ratio target will put a heavy pressure on banks. They thus should have financial preparations for risks and ensure effective credit growth.

The target of 13 percent credit growth is suitable but the State Bank’s HCM City branch should pay heed to credit quality, he added.

Last year HCM City banking system achieved positive results. Capital mobilisation went up 15 percent against the previous year to reach 1,344 trillion VND (62.97 billion USD ). Liability increased 12 percent to hit 1,068 trillion VND (50,036 million USD). The monetary market was stable and banking service quality was improved.

The Bank - Business Connectivity Programme has loaned 1,143 customers including businesses, traders and cooperatives with a total capital of 40,057 billion VND (1.88 billion USD).

Egyptian investors take interest in Vietnam

Egyptian investors showed strong interest in Vietnam’s business market during a dialogue jointly organised by the Vietnamese Embassy in Egypt and the Chamber of Commerce of Alexandria city in Cairo on January 26.

The event, with the participation of representatives from 17 local firms in various fields, was part of focused activities organised by the Embassy to introduce and promote Vietnamese products in a five million population market, said Vietnamese Ambassador in Egypt Dao Thanh Chung.

Vietnamese trade counsellor in Egypt Pham The Cuong also briefed local businesses on high-potential fields in Vietnam, such as agro-forestry-fishery product cultivation and processing, garment-textiles, leather footwear, rice and furniture.

General Director of the Egyptian engineering company Heshem Tawfik hailed Vietnam’s strategic vision, praising the efficient and well-orchestrated event.

In 2014, trade between the two countries was valued at 320 million USD, a substantial increase from 220 million USD in 2013. The figure is expected to grow even further to reach 400 million USD this year.

Binh Duong to make VSIP industrial-urban-service complex

The southern province of Binh Duong and the Vietnam-Singapore Industrial Park (VSIP) Group have agreed to expand the industrial park, which will include urban and social services in the future.

The consensus was reached during a meeting between Chairman of the provincial People’s Committee Tran Van Nam and Co-Chairman of the VSIP Group Kavin Teo on January 26.

Nam hailed the contributions of businesses, especially those from the two VSIPs, to the local socio-economic successes in 2014.

The province continues to promote sustainable development towards becoming a centrally-run first-tier city by 2020, he said, adding that it will prioritise projects with advanced technology and competitive products.

The provincial leader also pledged to further improve infrastructure and support investors.

Kavin Teo said effective management by the provincial authorities has increased investor confidence in the local business environment, noting that in 2014, the VSIP Group attracted 600 million USD in investment to 21 new and 26 current projects.

After nearly 20 years of development, the group has contributed to boosting local socio-economic growth, he said, adding that it now focuses on upgrading the VSIPs into urban-services-social welfare complexes.

Teo asserted that the success of the VSIPs in Binh Duong can serve as a foundation for the expansion of the model to other localities across Vietnam.

Vietnam forges new global market

The Tra Bac Joint Stock Corporation (TRABACO) has exported its first 100 tonnes of activated carbon for 2015 made from coconut husks to the Japanese market.

Activated carbon is used in gas purification, decaffeination, gold purification, metal extraction, water purification, medicine, sewage treatment, air filters in gas masks and respirators, filters in compressed air and numerous other applications.

The global market for activated carbon is forecast to reach a market size of 2.3 million metric tons by the year 2017, energized mainly by the anticipated spurt in demand for activated carbon in the US market, according to a new report by Global Industry Analysts, Inc.

In the future, apart from the traditional application areas, several new focus spheres are expected to arise from rigid governmental regulations in the US such as the Safe Drinking Water Act and the Clean Water Act among others.

The US and Asia-Pacific, (currently powered mainly by China, Indonesia, Philippines, Sri Lanka and Thailand) have traditionally dominated as two of the largest activated carbon producers around the globe.

TRABACO is forging a new pathway into the market and anticipates exporting 4,200 tonnes of activated charcoal in various types to foreign markets such as the EU, Asian nations, the US, South America and Australia and expand its outlets to the Middle East for 2015.

Nguyen Khac Nhu, TRABACO general director said this year, the company will focus on developing its brand name for Made-in-Vietnam high quality principally in the US and the South American markets.

Seafood exports to US hit record high

Vietnam’s seafood exports to the US for calendar year 2014 jumped 25.6% on-year, tallying in at US$1.709 billion, according to the Vietnam Association of Seafood Exporters and Producers (VASEP).

VASEP reported the US remained the country’s largest seafood market, accounting for 21.82% of the total market share.

Vietnamese seafood exports to Japan, the Republic of Korea and China increased by 7.55%, 27.85% and 11.38% respectively.

Vietnam was also the third largest supplier of seafood to Australia, trailing New Zealand and China.

In 2014 the country’s total seafood export value reached nearly US$8 billion, exceeding the target by US$1 billion.

HCM City prepares for 2015 Vietnam Food Expo

The Vietnam International Food Industry Exhibition 2015 (2015 Vietnam Food Expo) will be held from May 13-16 in Ho Chi Minh City, according to the Vietnam Trade Promotion Agency (Vietrade), under the Ministry of Trade.

The event is expected to feature 500 booths displaying various food and beverages, and packaging technology from 15 countries and territories.

According to Deputy Director of Vietrade Ta Hoang Linh, the 2015 Vietnam Food Expo will be an effective and high-profile bridge connecting Vietnamese manufacturers and agricultural product traders with domestic distributors and retailers as well as foreign importers.

The event looks to drive technological innovation and improve labour productivity to enhance the competitiveness of the country’s agricultural industry , he added.

Numerous programmes and activities will also be held during the four-day event, including the International Vietnam Food Industry Conference, an international cooking competition, and other trade promotion activities.

The annual Vietnam Food Expo is the leading trade fair for the food industry.

AES Mong Duong managing director elected in VCBSD’s Executive Board

Managing director of AES-VCM Mong Duong Power Company Limited, David Stone has been elected a member of the Executive Board of Vietnam Business Council for Sustainable Development (VCBSD) for the 2015-2016 term.

VBCSD is a Vietnamese business-led organisation and strives for excellence in sustainable development. The council is a member-driven organisation whose aim is to encourage the council members and the business community to participate and contribute to sustainable development. Being a business platform for sustainable development, the VBCSD shall continually promote the best business practices and apply ecologically efficient, environmentally friendly international business standards.

The Mong Duong 2 power plant with two units and the total gross capacity of 1,240MW is currently under construction in the northern province of Quang Ninh. The total investment for the project is approximately $2 billion, implemented under the build-operate-transfer (BOT) model. It is considered the largest BOT power project in Vietnam which utilises pulverised coal-fired boiler technology with advanced state of the art environmental controls to not only increase reliability but meet local Vietnamese and international standards in order to minimise the impact to the environment.

AES Mong Duong focuses on providing safe, reliable and sustainable energy solutions, as well as making a lasting difference in the communities they serve.  The project is one of only a limited number of plants in Vietnam with international financing and associated designs meeting both Vietnam and international environmental, health and safety standards.

The company has also developed a robust corporate social responsibility (CSR) programme that engages the community leading to the development of key initiatives and projects to improve the livelihood and the environment in the communities. Some of the initiatives to date include significant investment in the upgrades to medical and educational facilities and targeted environmental projects. AES Mong Duong is also very engaged in educating the community through site visits and community outreach programmes such as safety and values days at local schools.

EU investments stymied

The Eurozone crisis may hamper investments from Eurozone nations to Vietnam, as the euro’s depreciation makes investments in Vietnam more expensive.

The EU is among the largest sources of foreign direct investment inflows into Vietnam, with figures from the Ministry of Planning and Investment revealing that EU firms had registered to invest in 1,566 projects in Vietnam as of the end of December 2014, worth some $19.1 billion.

Vietnam was eagerly anticipating a flood of European investments following the near conclusion of a lucrative bilateral free trade agreement. Late last year, Prime Minister Nguyen Tan Dung even toured a series of EU nations including Germany, Belgium and Italy seeking  investment opportunities in Vietnam. But if the Eurozone continues to be dogged by problems, this will hamper investment inflows in Vietnam.

“The substantial devaluation of the euro against the US dollar has already made European products very competitive against those coming from other areas, especially those whose currency is linked to the US dollar, including Vietnam,” said Tomaso Andreatta, vice chairman of the European Chamber of Commerce (EuroCham) which has more than 700 European corporate members.

In mid-January, the euro dropped to an 11-year low against the US dollar after the Swiss National Bank made a decision to stop buying euros to anchor the Swiss franc.

Analysts believe the euro will keep on depreciating, pushing the Eurozone back into crisis like in 2009, with the threat of deflation. The situation currently suggests the European Central Bank may have to implement quantitative easing to spur economic growth.

Andreatta, who is also head of Intesa Sanpaolo Bank’s office in Ho Chi Minh City, said the investments from the Eurozone became more expensive in Vietnam. “An investment decided last year will see an automatic adjustment, as it was decided in terms of euro, so now, once translated into Vietnam dong, it is smaller,” he said.

In addition, Andreatta believed companies in the Eurozone were now poorer in terms of US dollars and they may decide to postpone or review investments previously planned.

Last but not least, the incentives for European business to outsource products from Vietnam has reduced, as the Vietnam dong is linked to the US dollar and has appreciated, thereby reducing the attractiveness of Vietnam’s low labour costs.

“There are parts of Europe with relatively low labour costs like Portugal or Romania, where productivity is higher than Vietnam and they are very close to the core of the EU market, which will now be considered as first choice for new production facilities for sales in Europe,” said Andreatta.

However, the current Eurozone crisis can only inhibit investments from this zone to Vietnam in the short term, given the potential growth in this market and EU monetary authority policies that could boost European economies.

“The overall economic development is affected by disappointing growth in the Eurozone and the geopolitical events. However, following extensive reforms, we can say that Europe and the euro are in better and more stable shape. The euro countries are undertaking comprehensive reforms,” said Thomas Hundt, director of Germany Trade and Invest in Vietnam.

Hundt believed European businesses would strengthen their competitiveness by investing in countries with the highest comparative advantage. The comparative advantages between European countries and Vietnam arise from differences in factor endowments or technological progress.

“There are still many potential gains to be made from free trade and open investment conditions between Vietnam and the EU. The upcoming Vietnam-EU free trade agreement will boost European investments in Vietnam in the long term. Other attractive factors for European investments this year are the expected accelerated Vietnamese GDP growth and today’s excellent business climate among European companies in Vietnam,” he added.

InterContinental finally moves into Keangnam

Three years after the Keangnam Hanoi Landmark complex was initially put into operation, InterContinental Hotel Group’s second hotel in Hanoi will finally come to fruition later this year.

Keangnam president Lee Hyo Jong told VIR last week that after a period of negotiations, InterContinental Hotel Group (IHG) and Keangnam had come to an agreement, and were making preparations to open the InterContinental Hotel at Keangnam in the second half of this year.

The reason for the delay, Jong said, was that the two sides had to resolve their differences in terms of their creative vision for the hotel’s overall style and facilities.

“One of the reasons why starting our hotel business has been delayed is the negotiating process on brand-standards with IHG. In order to satisfy the brand-standard required, it required large additional investment so it took quite a long time to deal with IHG. However, now all unclear issues are settled and it will begin operating within the second half of 2015,” Jong said.

InterContinental Hanoi Landmark 72 was initially due to be opened at the end of 2013, however the operation, it seemed, had been delayed to the point where even the billboard naming Intercontinental as the operator of the hotel was removed from the wall of Keangnam’s Landmark building.

VIR was told that all members of the team responsible for the pre-opening activities had been disbanded.

Clarence Tan, chief operating officer for Southeast Asia & Resorts of IHG confirmed to VIR that IHG was still working with Keangnam to open the hotel.

InterContinental Hanoi Landmark 72 looks set to be a 5-star luxury hotel, and the tallest hotel in Southeast Asia. At the very top of the Landmark 72 building, perched between floors 62-71, the 359 rooms will have spectacular views, not to mention access to a variety of restaurants and state-of-the-art meeting facilities.

“We know that the hotel segment is struggling through difficult times with supply greater than demand. However, we still have faith in our hotel, because we have our target customers, who are within the business circle from neighbouring industrial zones and MICE activities,” Jong said.

Moreover, being a multi-function complex, Keangnam’s president also believed that the demand of companies and their partners in the building could supply a stable source of customers.

Keangnam Landmark Tower is the tallest building in Vietnam, consisting of six separate components: apartments for sale, serviced residence, offices for lease, a retail podium, a living and entertainment serviced area, and a hotel. The hotel is the latest component to be into operation.

Bank-Business Connectivity Program well implemented in HCMC

The Bank-Business Connectivity Program has been implemented in Ho Chi Minh City for the last three years and provided low interest loans to over 4,500 businesses with a total amount of VND67.5 trillion (US$3.16 billion).

That was revealed at a conference hosted by the State Bank of Vietnam (SBV) in Ho Chi Minh City and the city People’s Committee yesterday.

Last year the program organized 31 events to connect banks with businesses. Nearly 1,200 businesses, households and traders and 62 cooperatives were loaned VND40,056 billion (US$1.88 billion), triple the number in 2013 and double initial norm set by the city.

Banks disbursed as per pledges, businesses used capital for right purposes and made payment on time.

The banks also restructured debts for 10,590 customers with a total liability of VND218 trillion, reduced interest rates for 177,481 customers with the total loan of VND439 trillion.

HCMC People’s Committee Deputy Chairwoman Nguyen Thi Hong said that the program purpose was to provide low interest bank loans to businesses, especially those in five priority fields and small and medium enterprises.

The committee has instructed SBV’s HCMC branch to coordinate with the Department of Industry and Trade, HCMC Business Association and district administration to take the imitative in looking for and accessing enterprises in need of capital and indentify their difficulties.

District people’s committees gathered information about businesses and proposed the State Bank to consider providing them with low interest loans.

Although the number of businesses able to get loans is not high but the program’s achievements are remarkable, said Ms. Hong.

At the conference she announced a new credit package of VND128 trillion (US$5,997 million) for the program this year with 19 commercial banks signing an agreement to join in.

SBV deputy governor Nguyen Dong Tien said that together with the price subsidization program, the Bank-Business Connectivity Program showed HCMC efforts to solve difficulties for businesses, help them reduce production costs, improve financial ability and competitiveness, boost production and trading to develop the economy.

The city’s economy has showed signs of recovery with the Gross Domestic Product growth reaching the highest rate for the last three years of 9.6 percent.

The State Bank Governor considered the city’s program as a typical modal to multiply nationwide. So far the country has mobilized VND250 trillion (US$11.71 billion) for programs to bring together banks and businesses. Over 300 talks have been held to listen to and solve businesses’ difficulties.

Fisheries output increases despite unfavourable weather

The nation’s total fishing production in January is estimated to reach 409,000 tonnes, up 2.3% compared to the same period in 2014, despite unfavourable weather conditions.

According to the Ministry of Agriculture and Rural Development (MARD), total production is forecasted at 223,000 tonnes, up 2.8%; while aquaculture output is also up by 1.8% to 186,000 tonnes.

A representative from the Directorate of Fisheries under the MARD said that fishermen in northern localities on their fishing season enlist to offshore operation, generating in a considerable output.

Local fishermen are encouraged to team up for offshore fishing and focus on catching high-value fish such as tuna, scad, squid, and shrimp, while increasing investment in boats to increase offshore capacity.

In particular, for tuna fishing, some provinces have seen significant increase in the total of produce caught, including Khanh Hoa with 450 tonnes, up 7.1%; Binh Dinh 240 tonnes, up 4.3%; and Phu Yen estimated at 550 tonnes, equivalent to the same period last year.

Aquaculture output in January also rose, estimated to reach 186,000 tonnes nationwide, up 1.8% year-on-year.

Accordingly, the farming area of tra in the Mekong Delta in January is estimated at 2,100 hectares, up 0.8% compared to the same period of last year with an estimated production of 24,000 tonnes, up 10.5%.

Several provinces like Tien Giang, Ben Tre, and Vinh Long have seen an increase in both acreage and yields, of which Ben Tre recorded the largest production area with an increase of 15% compared to the same period in 2014.

More conditions for rice exporters

Enterprises will have to meet stricter conditions if they want to get approval to export rice, according to a new decision of the Ministry of Industry and Trade.

The decision, effective from early March this year, governs a roadmap for paddy production and consumption in the 2015-2020 period with an aim to balance risks and benefits for rice traders and growers.

In the five-year period starting from 2015, enterprises should develop paddy farming areas with output equivalent to the volume they exported in 2011-2013. Those firms with export volume of less than 50,000 tons per year in the period will have to invest in 500 hectares of paddy in the first year, and increase the acreage by 300 hectares each year from the second year.

Meanwhile, exporters of 50,000 to less than 100,000 tons of rice per year will have to develop paddy fields of 800 hectares in the first year and expand the area by 500 hectares in each following year. The area must be 1,200 hectares in the first year and is increased by 800 hectares per year for those shipping 100,000-200,000 tons of rice per year.

The respective figures for exporters of more than 200,000 tons of rice per year in 2011-2013 will be 2,000 hectares and 1,500 hectares.

In its decision, the ministry clarifies three methods to develop paddy fields for rice exporters to choose. They are allowed to invest in large-scale paddy fields, sign contracts to buy rice from farmers, or produce paddy on the fields they lease from the Government, farming households or organizations.

Hoang Lam, director of An Giang Province-based Hung Lam Joint Stock Company, said the company has prepared procedures for a large-scale paddy field project for months but the project requires huge funding.

HCMC banks make US$6 billion loans

Nineteen banks in HCMC will lend nearly US$6 billion to local companies, family-run businesses and individuals this year, double the target set by the city government for the year.

At a launching ceremony of the 2015 bank-business connectivity program on January 26, the banks inked deals with the central bank’s HCMC branch and the HCMC Department of Industry and Trade to provide corporate and individual borrowers with loans amounting to over VND128 trillion (around US$6 billion).

The major lenders include Vietcombank with VND30 trillion, BIDV with VND20 trillion and Sacombank with VND10 trillion.

Earlier, the central bank’s branch in the city expected banks would lend VND60 trillion with preferential interest rates to businesses through the program this year, up 50% from the previous year.

This year, lenders will apply short-term lending rates of no higher than 7% per annum for designated borrowers and medium- to long-term rates of around 9% per annum.

The lender banks may also consider lowering the interest rates for old loans to help struggling borrowers.

Nguyen Hoang Dung, deputy general director of VietinBank, told the ceremony that the lender would consider reducing long-term interest rates by one to two percentage points against common levels within the next seven to 10 days.

Last year, VietinBank reported total outstanding loans of over VND20 trillion for the program. The bank applied short-term rates of 5.5-6% per annum and medium- to long-term rates of 7-10% per annum.

VietinBank has had no debt problems with the participating corporate borrowers of the program over the past three years as industry associations have provided it with enough information about those borrowers, Dung said.

Between 2012 and 2014, over 4,500 customers took out loans worth VND67.5 trillion thanks to the program, said Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch.

No overdue debts have been reported so far. However, many enterprises have not benefited from the program. Despite their feasible business plans, some have not been able to gain access to bank loans in the program given the lack of collateral, Minh said.

Banks should consider providing unsecured loans for certain enterprises. Minh said businesses could also mull borrowing from the city’s credit funds for small and medium-sized enterprises.

Last year, over 1,140 customers took out loans totaling over VND40 trillion from the program, up 1.3 times and three times from the previous year respectively.

Nguyen Dong Tien, deputy governor of the central bank, said the city’s lending model has been deployed nationwide. Up to now, enterprises have borrowed over VND250 trillion (US$11.7 billion) from the program.

PetroVietnam to focus on five business areas

Deputy Prime Minister Hoang Trung Hai has asked the Vietnam National Oil and Gas Group (PetroVietnam) to focus on five business areas this year, with oil and gas survey and exploitation as the core.

The primary goal is to increase the output and reserves of oil and gas, contributing to national energy security. Any underfunded projects should be brought to the attention of the government to develop creative solutions, he said.

The Ministry of Industry and Trade was assigned to ensure the progress of relevant projects in the gas industry as PetroVietnam effectively operates gas facilities and steps up power generation projects, especially in the supervisory, construction and bidding stages.

PetroVietnam is responsible for upgrading the Dung Quat refinery plant, accelerating projects on the Nghi Son oil refinery and petrochemical complex and the Long Son refinery complex, and safely operating other refinery and bio-fuel plants as indicated in its 2015 targets.

PetroVietnam’s firms in oil and gas should work to improve their capacity and extend cooperation with overseas markets.

The Deputy PM demanded PetroVietnam fine-tune its 2025 development strategy, including specifying its comparative advantages and disadvantages with regional partners, especially with the Malaysia oil and gas corporation Petronas, and devising ways to eliminate development gaps.

It was also urged to rapidly restructure its operations, per mandates from the Prime Minister.

PetroVietnam’s crude oil, gas, electricity, fertiliser and petroleum generated 745.5 trillion VND (35.5 billion USD) last year, 11.8 percent over its yearly target.

Central Highlands examines how to attract more foreign investment

The Central Highlands region lags behind other areas in the country in attracting foreign investment due to its poor infrastructure and lack of skilled labour.

According to the Foreign Investment Agency under the Ministry of Planning and Investment, the region, which comprises Kon Tum, Gia Lai, Dak Lak, Dak Nong and Lam Dong, had 148 valid foreign-investment projects with a total registered capital of 819 million USD by the end of last year.

Of these provinces, Lam Dong led with 122 projects capitalised at approximately 500 million USD and accounting for 82 percent of the region's total foreign-invested projects and 61 percent of total registered FDI, the agency noted.

Dak Lak ranked second with six projects, valued at 150 million USD, while Gia Lai placed third with 11 projects valued at 80 million USD. The two remaining provinces of Kon Tum and Dak Nong had nine projects with a combined capital of 89.6 million USD.

Of note, Hong Kong (China) was the region's leading foreign investor with 150 million USD, making up 18 percent of its total FDI. It was followed by Taiwan (China), with 122 million USD or 15 percent, and Japan with 103 million USD or 12 percent.

During the reviewed period, the agro-forestry-fisheries sector absorbed the largest share of FDI with 350 million USD, accounting for 42 percent of the region's total FDI, following by processing and manufacturing industries with 198 million USD, or 24 percent of FDI pledged in the region.

To attract more FDI, the agency suggested that these five provinces accelerate investment promotions to publicise their investment climates, potentials and prioritise sectors to alert foreign investors about investment opportunities.

Top priority should also be given to further upgrading infrastructure and improving human resources to better attract investors, it added.




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Police forces break down nearly 200-kilogram gold smuggling ring

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Vietnam's CPI rises over 3% in Q3

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Vietnam enjoys trade surplus of 6.52 bln USD in Jan-Sep

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Vietnamese, Cuban PMs discuss measures to boost cooperation

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Foreign service providers fulfill tax obligations in Vietnam

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Foreign Minister Bui Thanh Son pays official visit to Austria

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40 deaths by rabies in Vietnam this year

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Vietnamese fruit exporters enter world’s largest durian market

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Garment, textile, footwear industries face declining in orders

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Strict punishment for online copyright infringement needed

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Carbon market to help achieve net zero emissions

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Buckwheat Flower Festival returns to Ha Giang in November

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