World Bank programme requests research proposals
The Ministry of Planning and Investment (MPI) has invited proposals for World Bank (WB)-funded Vietnam Inclusive Innovation Project.
To be implemented during the 2013 to 2018 period, the project will aim to support Vietnamese research organisations, enterprises and individuals and help them adopt, upgrade, develop and commercialise technologies to deliver high performance products and technological solutions at an affordable cost for the benefit of the poorest.
It will also prioritise technological solutions for traditional herbal medicine, information and communication technology applications, as well as agriculture and aquaculture technologies.
The project's total investment is 55.625 million USD, with preferential loan worth 55 million USD drawn from the WB's International Development Association (IDA) and 625,000 USD from the Vietnamese government's corresponding capital.
MPI's Enterprise Development Agency will be responsible for the management and execution of this project. The National Foundation for Science and Technology Development (NAFOSTED) will manage capital allocated for participating organisations and individuals. Vietcombank and Vietinbank have also been selected to manage the loans of enterprises.
The closing date for the first call is March 31. The second and third calls will conclude on June 30 and October 31, respectively. However, the project's management board will start considering proposals after receiving 100 submissions.
Speaking at the opening of the first call for proposals in Hanoi on February 10, MPI Deputy Minister Dang Huy Dong emphasised the importance of the first invitation for proposals related to the project. He also expressed his belief that the project would attract considerable participation from research organisations, enterprises and individuals.
"I hope that during the first call for proposals, the project will select many outstanding ideas with advanced technologies and excellent innovation," he said.
WB Country Director in Vietnam Victoria Kwakwa said the project focusing on small- and medium-sized enterprises would support Vietnam's efforts to strengthen its domestic private sector and boost growth.
GE Hitachi, Vietnam nuclear safety agency ink MoU on technology training
An American provider of advanced reactors and nuclear services will help the Vietnam Agency for Radiation and Nuclear Safety (VARANS) enhance its understanding of boiling water reactor technology under a Memorandum of Understanding signed Tuesday.
GE Hitachi Nuclear Energy (GEH) will promote the training and development of qualified human resources in the field of nuclear safety analysis, the Wilmington-based company said the same day on its website.
The document was signed by GEH Senior Vice President and Chief Commercial Officer David Durham and VARANS director general Vuong Huu Tan at the Ministry of Science and Technology in Hanoi.
“This agreement will enhance the capability of VARANS staff to perform technical assessments and safety evaluations,” Durham said.
“Through this agreement and others we look forward to continuing to support the building of Vietnam’s nuclear power infrastructure.”
VARANS head Tuan viewed the MoU as a major event in Vietnam-U.S. nuclear cooperation since the signing of the bilateral 123 agreement.
The 123 agreement was signed by U.S. Secretary of State John Kerry in October 2013, and approved by the U.S. Senate Committee on Foreign Relations on July 23, 2014, according to the Nuclear Energy Institute’s website.
“Since [the signing], the bilateral cooperation between the two countries in this field has generated many positive results,” Tuan said in a statement posted on the VARANS website.
“The U.S. has supported Vietnam in legal framework development, personnel training and nuclear safety ability improvement.”
The VARANS head underlined that Vietnam is building its first-ever nuclear power plant and is thus in need of cooperation and support from international partners.
This is the third agreement GEH has signed in Vietnam in recent months, according to the U.S. firm.
GEH inked MoUs last fall with the Hanoi University of Science and Technology and Electric Power University to cooperate in the field of nuclear engineering and technology. Under the documents, students from the two universities will intern this summer at GE Hitachi’s world headquarters in Wilmington, North Carolina.
Vietnam is planning to build more than 10,000 megawatts of nuclear generating capacity by 2030, according to GEH.
“As the provider of the world’s safest reactor technology designs, GEH believes it is ideally positioned to help Vietnam meet its rapidly growing energy demands,” the company said.
GEH is among the world’s leading providers of advanced reactors and nuclear services, according to the company’s website.
Established in June 2007, GEH is part of a global nuclear alliance created by GE and Hitachi to serve the global nuclear industry.
The nuclear alliance executes a single strategic vision to create a broader portfolio of solutions, expanding its capabilities for new reactor and service opportunities. It also offers customers around the world the technological leadership required to effectively enhance reactor performance, power output and safety.
VARANS is a regulatory body under the Ministry of Science and Technology that is responsible for helping the Minister of Science and Technology manage radiation and nuclear safety, nuclear security and safeguards, the agency said on its website.
Vietnam invests nearly 20 billion USD abroad
By the end of 2014, Vietnam has had 930 investment projects underway in foreign countries with a total registered capital of 19.78 billion USD, according to the Foreign Investment Agency under the Ministry of Planning and Investment (MPI).
During 2014 alone, the MPI licensed 109 Vietnamese-invested projects in 28 countries and territories with a total registered capital of 1.047 billion USD.
Of the 109 projects, Vietnamese enterprises have invested in 23 projects in Cambodia, accounting for 21 percent of the total projects.
Other major Vietnamese investment destinations include Myanmar, Laos, the US and Singapore.
Power sector urged to boost production
Deputy PM Hoang Trung Hai has urged the National Power Transmission Corporation under the Electricity of Vietnam (EVN-NPT) and power plants to enhance production and operations and ensure safety and incomes for workers.
Deputy PM Hai made the statement while visiting the Mong Duong 1 and 2 Thermal Power Plants and the Quang Ninh 500kV Substation under the Dong Bac 1 Power Transmission Company in the northern coastal province of Quang Ninh on February 9.
He praised the contributions of power production and transmission units in the northeast region to the national power network, meeting the country’s power demand.
Earlier, the Government official had a working visit to the Cua Ong Coal Company, Nam Khe Tam mine and workers’ accommodation from the Dong Bac Corporation.
After hearing the corporation’s report on its operations, Deputy PM Hai acknowledged the outcomes and stated new tasks for the coal sector to realise 2015 targets and get ready for the 2016-2020 plan.
He reminded the corporation about boosting technological innovation, maintaining working discipline to ensure extraction safety and effectiveness, and continuing to improve living standards for the workers.
Economy benefits much from oil price slump
Experts at a seminar in Hanoi last week stressed that the benefits of diving oil prices for the economy far outweigh the lost revenues of the State and Vietnam National Oil and Gas Group (PVN).
If the oil price falls by US$1 a barrel, PVN may lose VND2.5 trillion in revenue, said Le Viet Trung, director of the Research Center for Petroleum Economics and Management under the Vietnam Petroleum Institute at the seminar in Hanoi last Friday on the world oil price prospects in the medium term and scenarios for Vietnam’s economy.
However, Trung said the oil price plunge benefits the nation’s economy. “Lower material cost is the first benefit of falling oil prices and will stimulate domestic production and consumption. This is good for the economy,” Trung said.
Trung noted that declining oil prices do not bring out immediate impacts on the economy as fuel prices and transport cost on the domestic market take more time to decline.
Luong Van Khoi, head of global economy department at the National Center for Socioeconomic Information and Forecast, shared Trung’s view, saying that oil price declines will do more good than harm for Vietnam’s economy when scenarios are taken into account.
Khoi said if a barrel of crude oil is priced at US$50, Vietnam’s GDP could grow an additional 0.48%, inflation will fall by 1.14%, tax collections will go down VND6.66 trillion and foreign reserves will fall by US$1.04 billion.
Last year, the country’s GDP was estimated at US$184 billion, and a further GDP rise of 0.48% would generate an additional US$900 million, equivalent to VND19 trillion.
If the oil price is US$40 a barrel, GDP would increase by a further 0.61% while inflation, tax collections and foreign reserves would drop by 1.11%, VND7.64 trillion and US$1.12 billion respectively.
In case, the oil price is US$30 per barrel, GDP is projected to expand by an extra 0.75%, inflation would go down 1.07%, tax collections would fall by VND8.663 trillion and foreign reserves would shrink US$1.45 billion.
These scenarios do not include the oil crude pumping of PVN.
Economic expert Luu Bich Ho said the oil price slump is not too worrisome as earnings from crude oil account for only 12% of total budget revenues.
To beef up growth, Khoi called for the central bank to loosen monetary policy and further cut interest rates for loans.
Higher taxes for HCMC restaurants, household businesses
The HCMC Department of Tax has adjusted up tax rates for restaurants, wedding service centers and household businesses on major streets as part of its new tax scheme applicable to nearly 130,500 individual and household tax payers in the city this year.
Tran Thi Le Nga, deputy director of the department, said the scheme is expected to help the city increase tax collections by 16-17% this year as assigned by the Ministry of Finance.
Nga stressed that the agency has made careful tax adjustments to ensure fairness for tax payers, particularly household businesses.
The agency has not changed tax rates for individual traders at traditional small- and medium-scale markets given their sales declines. Some have even benefit from lower tax.
Nga said the agency has classified and considered multiple cases to apply reasonable tax rates. For example, household businesses with total annual revenues of VND101-108 million do not have to pay certain taxes.
Statistics of tax authorities in HCMC’s 24 districts showed that about 130,500 out of 181,000 household businesses have annual sales of more than VND100 million, and their combined personal income and value added taxes are estimated at VND2 trillion this year, accounting for 1.2% of tax revenue from domestic sources. Each of these individuals and household businesses has to pay monthly taxes of about VND1.3 million.
The owners of housing for rent to students and workers were subject to tax exemptions and reductions last year, but have to pay personal income tax this year if their revenues are more than VND100 million a year. The personal income tax rates are 2-5% of revenue.
Local firms may lag behind regional rivals
Domestic enterprises may be left behind if they do not quickly prepare plans to catch up with regional rivals and make the most of the country’s deeper integration into the region, warned experts at a conference in HCMC last week.
Local companies will also have to cope with fiercer competition as Vietnam is opening its doors wider by participating in more bilateral and multilateral free trade agreements in the coming years.
Speaking at the conference on major challenges for Vietnamese businesses from 2015, ambassador and head of SOM ASEAN Vietnam Nguyen Vu Tu said the ASEAN Economic Community (AEC) will be established on December 31, 2015.
Under the ASEAN Trade in Goods Agreement (ATIGA), Brunei, Indonesia, Malaysia, Singapore, the Philippines and Thailand already cut tariffs on goods imports among these markets to a 0% tax rate in 2010 while Cambodia, Laos, Myanmar and Vietnam will have to exempt their import duty rates from this year.
Vietnam brought down import taxes on 80% of the tariff lines to a 0% rate in 2010. The country will add 10% to the list this year and maintain 7% at rates of 0-5% in 2017, meaning Vietnam will have to further open its market to goods imports from ASEAN.
However, when import tariffs are exempted, countries may resort to technical barriers to control imports from ASEAN, Tu said.
Trade and services within the bloc, including aviation, information technology, healthcare, tourism and logistics, will increase this year as member countries have to fulfill commitments to the ASEAN Framework Agreement on Services (AFAS). The bloc is expected to conclude negotiations soon over the ASEAN Trade in Services Agreement to fuel growth in these fields.
Regarding investment, Vietnam has liberalized almost all sectors for ASEAN investors since 2013 and will do this for investors outside the bloc this year. Currently, member nations are working towards the ASEAN Comprehensive Investment Agreement (ACIA) to attract investors.
ASEAN countries have committed to allowing skilled workers to find jobs within the bloc but the commitments have not affected Vietnam’s labor market as the implementation has progressed slowly.
ASEAN nations have pledged to build close links among banking and securities sectors to boost capital flows. They have negotiated on financial service liberalization and are now developing a framework on capital flows.
Tu described 2015 as an important transitional year for Vietnam to open up its market, especially for ASEAN companies. One of the major challenges for domestic enterprises is that they have to meet higher requirements, especially for food safety and hygiene.
The Government will face more pressure to improve the business and investment environment as well as social welfare.
Between now and 2020, Vietnam will implement and wrap up negotiations over 15 trade agreements with 57 countries and territories which account for 65%, 95% and 84% of the world’s population, gross domestic product, and trade respectively. In 2018, Vietnam will fully implement its commitments to the World Trade Organization (WTO).
Nguyen Nguyet Nga of the APEC Secretariat 2017 under the Ministry of Foreign Affairs said competition will be the biggest challenge for Vietnamese enterprises, particularly husbandry, dairy, steel, automobile and sugar sectors which have been protected over the years.
Nga said weaknesses of local enterprises will exposed in the next 5-10 years and they might lag far behind regional counterparts if they cannot find effective solutions to these problems.
Companies in Brunei, Indonesia, Malaysia, Singapore, the Philippines and Thailand have invested heavily to capitalize on increasing trade within ASEAN while Vietnamese firms have paid more attention to markets outside the bloc.
Bold measures needed to fuel growth - experts
Vietnamese and foreign experts have called for Vietnam to take bold measures to fuel economic growth in the years to come.
Economic expert Pham Chi Lan said at a seminar on Vietnamese firms in a new era of global economic integration in HCMC last week that it would be difficult for the nation to achieve high economic growth if it lacked strong actions.
Lan mentioned two scenarios for Vietnam by 2035. First, the nation could obtain breakneck growth of 9% a year and drastically raise people’s incomes, and second, the country could be satisfied with the current growth rate of 5-6% and the current average per capita income of around US$10,000.
She said the competitiveness of local economy and enterprises has not improved much and Vietnam has remained on the lower end in the region two decades after the country became a member of the Association of Southeast Asian Nations (ASEAN).
In the past years, the country’s growth has hinged mainly on low labor cost and outsourcing rather than high labor productivity and creativity. There has been a slow increase in labor quality since 2006 and unskilled workers still take the lion’s share of the country’s manpower.
On top of that, 70% of Vietnam’s export products are items of low value, and this proportion is better than Laos with 79% and Cambodia with 94%.
Herb Cochran, executive director of the HCMC Chapter of the American Chamber of Commerce in Vietnam (AmCham), pointed out that most of Vietnam’s exports are low-value goods like garments and footwear and foreign-invested enterprises account for 68% of the country’s total export sales.
The nation’s economic growth was only behind China’s before the global financial crisis but has since been lower than the Philippines and Indonesia.
In terms of economic incentive beneficiaries, the local private sector is placed after State-owned enterprises and foreign direct investment firms. Economic woes have forced private companies to scale down their operations and labor force.
Cochran suggested the Government support small enterprises by granting them contracts and creating a supply chain for them to join. Policies should be worked out based on the actual situation of the local economy.
Commenting on economic growth this year, Nguyen Xuan Thanh, director of the Fulbright Economics Teaching Program in Vietnam, said a gross domestic product growth rate of around 6% in 2015 is achievable in accordance with projections by many foreign organizations.
Thanh noted that there were grounds for Vietnam’s GDP growth of nearly 6% last year as manufacturing and processing sectors improved, industrial production grew month-on-month to more than 8%, and crude oil exports rose by nearly 9% though oil prices slumped on global markets.
Despite a 5-6% pickup in domestic sales in 2014, exports increased by 13.6% year-on-year to a US$150-billion milestone and helped the country enjoy a trade surplus of US$2 billion.
After years of tightening, public investments rose more than 11% in 2014 coupled with increases in the FDI sector.
Thanh predicted that monetary and fiscal policies would be loosened in 2015 and inflation would be 5%, the same as the Government’s expectations.
Public debt including the loans guaranteed by the Government rose to almost 60% of the country’s GDP last year and Thanh forecast it would reach 64% this year before easing off in the following years.
At a conference in Hanoi last week, Minister of Planning and Investment Bui Quang Vinh talked about the possibility of adjusting up the public debt ceiling in order to raise funds for development projects and public debt rising to 64.9% of GDP next year, which almost hits the allowable upper limit of 65%.
VN Pangasius seeks to improve distribution
The Vietnam Pangasius Association (VN Pangasius) has underscored an urgent need to improve the distribution efficiency of tra fish products in order to help the sector spur competitiveness and earn more revenue.
Vo Hung Dung, general secretary of VN Pangasius, told a seminar on restructuring of the tra fish sector in the Mekong Delta province of Dong Thap last week that identifying what needs to be restructured will help the sector solve shortcomings.
Dung pointed out there are problems with breeder fish, breeding, processing and distribution in the tra fish sector. However, he stressed the sector should focus more resources on developing distribution channels and finding ways to directly sell products to foreign importers.
Dung said enterprises in developed countries spend heavily on building and expanding outlets for their products but local companies cannot do this due to their weak capacity and supporting policies.
Le Vinh Tan, deputy head of the Party Central Committee’s Economic Commission, shared Dung’s view, saying that consumption is a big problem for the country’s agricultural sector in general and the tra fish sector in particular.
“Developing export markets is crucial for the success of the local tra fish sector,” Tan said.
Tra fish exports have jumped to US$1.7-1.8 billion a year as currently, and distributors and retailers in foreign markets have benefited much from this strong growth and have financial capacity to acquire tra fish firms in Vietnam.
Therefore, experts at the seminar urged the tra fish sector to quickly expand export markets, improve technology to produce breeder fish, and enhance governance at local enterprises.
“The governance models that local enterprises apply will likely turn outdated when the country further integrates into the regional and global economies,” Dung said.
Local tra fish enterprises should identify market segments for their products and improve their market forecast capacity and competitive edge at a time when Thailand, Indonesia, India and even Cambodia are investing much in similar products.
NFSC puts CPI at 3% this year
The National Financial Supervisory Commission (NFSC) has projected Vietnam’s consumer price index (CPI) at around 3% and gross domestic product (GDP) growth at 6.2% this year.
The commission’s projections are the same as the Government’s GDP growth target but lower in terms of inflation. At a meeting in late January, the Prime Minister told ministries and agencies to rein in inflation at around 5% this year.
In a recent report sent to the Government, NFSC said the CPI estimate is based on the World Bank’s forecast for the average price of crude oil at US$96.2 per barrel last year and US$53.2 per barrel this year.
The commission said there have been more signs of recovery in the economy. The index of industrial production (IIP) last month rose by 17.5% against the same period last year. Notably, processing and manufacturing expanded 19.4%, higher than the increase of January last year and the average monthly rise in 2014.
According to a recent report of HSBC, the Purchasing Managers' Index (PMI) of Vietnam’s manufacturing sector stood at 52.7 points last December, the highest level since April of the same year. This suggested better performance of the sector.
Meanwhile, the index of input prices in December 2014 was below 50 points, the lowest rate in two and a half years.
Consumption rose strongly in January, less than one month before the Lunar New Year (Tet) holiday. As a result, total retail sales of goods and services climbed 11.95% (price factors excluded) against a year ago and higher than in previous years.
January’s retail sales of goods and services increased 8.9% in 2011, 4% in 2012, 1% in 2013 and 7.2% last year.
The Business Climate Index (BCI), an indicator of European firms’ confidence in Vietnam’s outlook, reached 78 points in the fourth quarter of last year, the second highest since 2010.
The VN-Index edged up 8% last year despite the impacts of worker protests against China’s illegal installation of a giant oilrig in Vietnam’s waters in May last year and global economic downturn.
As of January 27, the winning streak had extended and the main index had gained 6% year-on-year thanks to falling fuel prices on the world and domestic markets and foreign buying. This meant investor sentiment and stock trading improved remarkably.
NFSC estimated the country’s GDP growth at 5.4% in the first quarter of this year and the uptrend would continue in the next quarters. Therefore, the GDP growth target of 6.2% this year is obtainable.
HCM City urged to find proper growth driver
HCMC needs to identify a proper driver for future growth as it now cannot compete with cities in the region, heard a seminar yesterday.
Speaking at the seminar on the city’s economic restructuring in 2013-2020 held by the HCMC Institute for Development Studies, economic expert Huynh The Du said he is conducting a study on the competitiveness of HCMC and that this city’s competitive edge is much lower than Manila of the Philippines and Bangkok of Thailand.
Du cited Lee Kuan Yew’s autobiography which says that HCMC was able to compete with Bangkok in 1975, but was left 20 years behind in 1992.
With Bangkok’s GDP per capita growth of 4.3% per year and HCMC’s 8.7%, it would take HCMC 20 more years to catch up with Bangkok. In terms of infrastructure, HCMC will not have the first metro line finished until 2018 while Bangkok had the track in 2000.
Du said the HCMC government should work out solutions and find driving forces to help the city move forward.
Du said when studying the competitiveness of HCMC, he realized three basic problems. Civil servants have a low motivation for work or have no motivation at all, statistics are unreliable, and development planning is not of help.
“These are three common problems of the country,” Du said.
Tran Anh Tuan, deputy head of the institute, said the economic structure of HCMC was based on the two main pillars: service and industry-construction in 2001-2014. In this period, the number of service enterprises in HCMC accounted for 70% of the total, the industry-construction sector took up 26% and the agricultural sector made up the remainder.
The service sector will continue to play a key role in the city’s economy in the 2013-2020 period with a focus on financing, banking and insurance; trade; transportation, warehouses and ports; post-telecom and information technology-communications; real estate; consulting, sciences and technology; tourism; healthcare; and education.
A report of the HCMC Department of Planning and Investment released early this year showed that the proportion of the service sector is expected to rise from 53.6% of the city’s GDP in 2010 to some 59.9% this year while that of the industry-construction sector will fall from 45.4% in 2010 to 39%. Besides, the agricultural sector’s proportion has been just around 1% in the past years.
Many power companies fare well
Sales and profit of a lot of hydropower and thermal power plants grew in 2014 after years in difficulty.
Southern Power Corporation posted revenue of nearly VND65.78 trillion (US$3 billion) last year, up around 14% year-on-year. Six companies under the corporation reported sales rises by 20-30% while 15 other subsidiaries in the southern region recorded revenue increases of below 20%.
Figures showed 2014 was a successful year for many hydropower and thermal power plants as their profit doubled and even tripled compared to the previous year, and a number of enterprises rode out of losses.
For instance, net profit of Central Hydropower Company nearly doubled to around VND213 billion last year. In 2012, the enterprise incurred losses of nearly VND7 billion.
Southern Hydropower Company posted net profit of nearly VND215 billion in 2014, nearly doubling the year earlier.
Ba Ria Thermal Power Company saw after-tax profit last year triple to nearly VND150 billion and net profit of Ninh Binh Thermal Power Company rose by VND9 billion to VND45 billion.
At a meeting with the Ministry of Industry and Trade on December 31 last year, representative of Vietnam Electricity Group (EVN) said this State-run corporation obtained profit of some VND300 billion in 2014.
However, EVN declined to give specific information about bonuses for its employees on the occasion of the Lunar New Year holiday (Tet).
As observed by the Daily, employees of the electricity sector can get the average Tet bonus of VND20-30 million, which is much higher than employees of other sectors like transport, apparel and footwear.
According to the Ministry of Labor, Invalids and Social Affairs released last month, the average Tet bonus for an employee is VND5 million and the lowest is VND30,000.
State capital divestments in HCMC lower than expected
Fifteen State-owned corporations in HCMC had pulled a mere 15% of VND3.81 trillion capital set for the 2014-2015 period out of the fields of banking, insurance, real estate and investment funds by the end of last year.
Huynh Trung Lam, deputy head of the HCMC Steering Committee for Enterprise Reform and Development, told the Daily about the slow divestment on the sidelines of a review meeting on equitization of State-owned enterprises (SOEs) in the city on February 5.
Lam said the committee has reported to the HCMC government that divesting 85% of the State capital from non-core businesses in 2015 is a tough task and completing this requires great efforts of all the SOEs concerned.
Local SOEs have no choice but to pull all capital out of real estate, insurance and banking sectors this year to concentrate their resources on core operations.
Lam said the combined divestments of SOEs in 2013 were modest, at only VND30 billion.
Most of the SOEs in the city ran at a profit last year but their revenues dropped in the past years. For example, their total sales were nearly VND157.38 trillion in 2011 but fell to over VND122.5 trillion in 2012, and almost VND84.75 trillion in 2013.
At the meeting on February 5, 19 SOEs in HCMC signed agreements promising to go public this year. Last year, a dozen SOEs finished their equitization.
Nguyen Van Du, deputy general director of Saigon Water Corporation (Sawaco), which plans to equitize four subsidiaries, complained about time-consuming and complicated procedures for land value evaluation and asset liquidation at entities subject to equitization.
Du said the allowable fees for equitization should be revised up as the current levels are too low.
Nguyen Thi Mai Thanh, chairperson of REE Corporation, said one of the keys to equitization success is to develop enterprises into attractive companies for employees, board of directors and shareholders. This is the reason why REE applied for equitization in 2002.
REE now has 10,000 shareholders and equity of VND6 trillion, 400 times higher than 1993. Its profit soared to more than VND1.05 trillion last year from VND975 billion in 2013.
“It is important to manage operations, identify possible risks and leave loss-making businesses,” Thanh said. “We cannot supervise our operations if we do not have good corporate governance.”
Alumina route upgrade to finish this month
BT20-Cuu Long Joint Stock Company has urged contractors to accelerate work on National Highway 20 and complete upgrading the section of this road used for alumina transport this month.
A new La Nga Bridge on the national highway was opened to traffic on February 5, allowing bigger vehicles to transport alumina from Lam Dong to Dong Nai Province.
The investment cost of the 330-meter bridge in La Nga District in Dong Nai Province is worth VND170 billion (US$8 million) and part of the upgrade project for the national highway.
Tran Van Vinh, vice chairman of Dong Nai Province, told the opening ceremony that trucks of 25 tons or heavier now can run through the new bridge.
Concerning the road upgrade, contractors have covered asphalt on 40% of the road section in the first phase and plan to finish work within this month, according to Do Ngoc Dung, general director of BT20-Cuu Long Joint Stock Company.
The National Highway 20 upgrade project comprises of two phases. The first phase covers the section from Dau Giay in Dong Nai Province to Bao Loc City in Lam Dong Province and is carried out under the build-transfer (BT) format at a cost of nearly VND4.5 trillion.
The remaining national highway section of the second phase is estimated to cost VND3.1 trillion and will be upgraded when investors are found.
National Highway 20 is the key road connecting Dong Nai Province and Dalat City in the Central Highlands Province of Lam Dong.
S.Korea firms stop wood pellet imports from Vietnam
Local producers of wood pellets have been lost in dismay as companies in South Korea, a major pellet importer of Vietnam, have stopped buying the product.
By the end of last year, Vietnam had become the biggest wood pellet supplier of Korea with its shipments twice as big as those of Canada, the second biggest provider of Korea, said Nguyen Dinh Quan, chairman of the Southern Wood Pellet Club.
Korea mainly imported wood pellets from China, Malaysia and New Zealand before 2010, and started purchasing the product from Vietnam in 2011. In 2013, enterprises in South Korea increased wood pellet imports from Vietnam after their government had a policy to raise the ratio of biomass power in the country’s total new and renewable energy to 30% in 2030 from 6% in 2007.
However, a halt in shipments of wood pellets to South Korea since last December has led to a sharp fall in prices and a upsurge in inventories.
Explaining the suspension, Quan said the supply of pellets in the Korean market has outpaced the demand due to a large volume of pellet imports in previous years.
On the other hand, Korea has extended the deadline for shifting to renewable energy by five more years, resulting in a drop in the demand for using wood pellets among other renewable energy there.
The surge in wood pellet producers in Vietnam is also to blame. Data of the wood pellet club shows there were 150 firms active in this sector in 2012-2013 but the number soared to 400 last year with combined output of 200,000-300,000 tons per month.
As of September last year, Vietnam had exported nearly 500,000 tons of wood pellets worth US$170 per ton to Korea. After that, that market reduced shipments from Vietnam, throwing local wood pellet firms into a difficult position. Many of them have stopped operations.
To find the way out of the roadblock, local enterprises are encouraged to explore opportunities in new export markets, including China, Japan and Europe as well as the home market.
Nguyen Khanh Ha of the Vietnam Wood Pellet Association expected wood pellet producers can sell up to one million tons to households a month based on the number of some 12 million cookers fueled by coal and wood in the country.
“This is a big market for wood pellets,” Ha said.
Dak Nong spends big on Macadamia development
The Central Highlands province of Dak Nong will invest more than 1.13 trillion VND (52.7 million USD) in an ambitious plan to plant macadamia trees across more than 12,000 hectares in five communes of border district Tuy Duc by 2020.
Around 85 billion VND will be sourced from the State budget and the remaining bulk is to come from loans and businesses’ investment.
The locality will devise incentives encouraging the participation of enterprises and communities in the project including interest subsidy for loans taken for the purpose. In addition, each ha of newly-planted macadamia will receive a grant of 15 million VND in line with the Government support policy.
The provincial administration will invest in two nurseries to produce high-quality macadamia seedlings that meet international standards and a processing plant with a design annual capacity of nearly 20,000 tonnes of macadamia products.
Tuy Duc district, one of four border districts in Dak Nong, has ideal conditions for the growth of the tree, revenue from which will contribute to poverty reduction and raising the local living condition while protecting forestry and ensuring social and political order and security.
The macadamia nut is dubbed “the Queen of Nuts” for its extraordinary nutritional value.
Experts said compared to other common edible seeds, such as almonds and cashews, macadamias are low in protein and have the highest mono-unsaturated fat content.
The plant, indigenous to Australia , was introduced to Vietnam in 2002 after local scientists took soil samples and discovered that the northwest and Central Highland regions had ideal growing conditions for the plant.
Notably, Vietnam’s macadamia trees have since produced equivalent or higher yields than Australian trees, the world’s number one macadamia cultivator.
Mekong Delta strives for 10.2 bln USD in aquatic, rice exports
The Mekong Delta generated 850 million USD in aquatic and rice exports in January, equal to 8.3 percent of the annual target and 75.2 percent of the region’s total export revenue, according to Can Tho city’s Statistics Office.
The region looks to garner around 10.2 billion USD from the export of the two products alone this year. It currently uses 800,000 hectares of water surface for aquaculture and 4.2 million hectares of land for rice cultivation.
The aquaculture products industry targets an output of 3.7 million tonnes to meet the demand of 198 local processing plants, and rice farmers intend to ensure 80 percent of their crops are considered high-quality rice.
Mekong Delta localities will also increase the quality of trade promotion activities by assisting businesses to conduct market surveys and advertise their products in Asian, African, Oceania, European and North American countries.
Enterprises will be provided with global experience in risk management during the import-export process and applying special financial conditions.
They will also be provided with 56 billion VND (2.63 million USD) in loans to invest in technological renovation, production scale expansion, and process industry restructuring to improve their market competitiveness.
Last year, regional localities boosted trade promotion activities in many Asian, European and North American nations, while improving the production of high-quality rice for export to particular markets like Japan, the EU, the US, Singapore, and Australia.
The region’s aquatic products and rice exports were valued at 8.9 billion USD in 2014, an increase of nearly 700 million USD from the previous year.
Vinachem to sell its Hanoi Soap Company shares
The Viet Nam National Chemical Group (Vinachem) is set to sell all of its shares in Hanoi Soap Joint Stock Company (XPH), according to Hanoi Stock Exchange.
The shares, amounting to more than 10.37 million, or an 80-per cent stake in XPH, will be auctioned on March 17 this year. The investors can register and pay in instalments from February 9 to March 30 this year.
However, foreign investors are not permitted to buy the shares or register to participate in the auction.
The XPH has registered capital of more than VND129.7 billion (US$6.08 million), and the company specialises in producing multi-purpose detergents and in trading imported chemicals, materials, and detergents; packages; and labels.
The company began listing on the unlisted public company market (UPCoM) managed by the Ha Noi Stock Exchange on November 25, 2014, with a reference price of VND18,000 ($0.80) per share. At present, the XPH shares are being purchased for VND13,200 ($0.60) each.
Hitachi works on expanded sewage treatment facility
Hitachi, Ltd. (TSE: 6501 / “Hitachi”) today announced to have received an order from the Urban Civil Works Construction – Investment Management Authority of Ho Chi Minh City for an expansion work project to a large-scale sewage treatment facility in the city.
The ground-breaking ceremony to this expansion project was held at the Binh Hung Sewage Treatment Plant in Ho Chi Minh City on February 7. The order was awarded to a three-company consortium represented by POSCO Engineering & Construction, a major South Korean construction company, and comprising OTV, a subsidiary of the major French environmental services group Veolia Water Solutions & Technologies, and Hitachi. This project worth around $130 million in total will be funded by loan assistance from the Japanese government.
As the largest city in Vietnam, Ho Chi Minh City has seen its volume of industrial and domestic wastewater surge in step with rapid industrialisation and urbanisation. Concerns that this surge could worsen the water quality of rivers and affect the sanitation and health of the residents are mounting, due to the inadequate development of sewage treatment facilities.
This project aims to improve Ho Chi Minh City’s urban and domestic sanitation by expanding the daily processing capacity of the existing sewage treatment facilities from 141,000 to 469,000 cubic metres. The expanded capacity would be sufficient to meet the wastewater treatment needs of approximately 1.4 million people, and would make the plant one of the largest sewage treatment facilities in Southeast Asia.
Plans are currently under way for future sewage infrastructure development projects in Vietnam, and Hitachi will continue its participation in this business in the future. Hitachi aims to contribute to Vietnam’s development by putting in place water infrastructure and maintaining and improving Vietnam’s water environment.
Kunizo Sakai, president and CEO of Hitachi’s Infrastructure Systems Company said, “Hitachi is honored to be involved in the expansion work project to a large-scale sewage treatment facility in Ho Chi Minh City in collaboration with POSCO E&C and Veolia. Hitachi has an extensive track record and expertise in the delivery of water treatment plants throughout the world, and we look forward to contributing to the maintenance and improvement of the water environment in Vietnam by putting in place reliable water infrastructures.”
The expansion project in Ho Chi Minh City is the second large-scale project awarded to Hitachi and OTV, following orders received in 2014 for a 199,000 cubic metres per day desalination plant and pre-treatment facilities in Basrah, Iraq, the largest of its kind in the country.