First fuel price hike in the year

The Vietnam National Petroleum Group (Petrolimex), the country’s largest fuel wholesaler, raised the retail price of several fuel varieties as of 15:00 pm on March 11, the second adjustment and the first rise this year.

Accordingly, the prices of petrol RON95 and petrol RON92 jumped 1,610 VND (0.075 USD) per litre to 17,880 VND (0.84 USD) and 17,280 VND (0.81 USD) per litre, respectively, while bio-fuel E5 price increased by 1,600 VND per litre to 16,950 VND (0.8 USD).

Diesel and kerosene prices rose by 710 VND (0.03 USD) to 15,880 VND (0.74 USD) and 16,320 VND (0.76 USD) per litre, respectively.

Mazut now costs 12,760 VND (0.6 USD) per litre, up 910 VND (0.042 USD).

The same day, the Ministry of Industry and Trade lowered state subsidies for fuel from the Fuel Price Stabilisation Fund.

For example, subsidies for gasoline RON95 and RON92 were cut by 596 VND per litre to 1,852 VND (0.087 USD) while those for diesel fell 462 VND per litre to 888 VND (0.041 USD).

Viet Nam, Malaysia Jan trade up 11.9%

Two-way trade turnover between Viet Nam and Malaysia reached US$671.6 million in January.

This reflects a year-on-year increase of 11.9 per cent, according to officials at the Office of Commercial Affairs at the Vietnamese Embassy in Malaysia.

Viet Nam's imports from Malaysia reached $353.6 million, increasing by 25.9 per cent on the year.

Meanwhile, Viet Nam's exports to Malaysia dropped 0.3 per cent to $318 million.

Viet Nam exports to the Malaysian market in January included crude oil, telephones and components, computers and rubber.

Crude oil exports worth nearly $64.5 million ranked first, followed by telephones and components with $58.4 million.

In January, Viet Nam imported computers, electronic products and components ($84.5 million); machines and spare parts ($43.7 million); animal fats and vegetable oils ($29.8 million); and other products from Malaysia.

Malaysia was Viet Nam's eighth largest investor as of January 20, with 484 projects and nearly $10.8 billion in registered capital.

Meanwhile, Viet Nam has invested in nine projects worth $812.6 million in Malaysia.

PVN to invest $2.3 mil in oil dump, port in Phu Quoc

The Viet Nam Oil and Gas Group, or PetroVietnam (PVN), plans to invest VND500 billion (US$2.3 million) in building an oil dump and port system in Phu Quoc Island District in the southern province of Kien Giang.

During a meeting with provincial authorities, PVN proposed building the project on 32 hectares (ha) of land and nearly 60 ha of sea. The oil dump facility will be designed to contain about 100,000 cubic metres, while the port system will serve vessels with a deadweight tonnage (DWT) of between 15,000 DWT and 30,000 DWT.

Investments can be made until 2017. If the project is approved by Kien Giang authorities, it will operate for 70 years.

Work starts on $187.8 mil urban area in Ha Long

Construction work began in an urban area on the coast of Ha Long Bay in the northern province of Quang Ninh yesterday.

The 18-hectare project, with investments totalling VND4 trillion (U$S187.8 million), will include 70 three-storey villas, a 35-storey building, and a trade and service centre.

The project will be built by Quang Ninh Urban Development Company Ltd and is scheduled to be completed by 2020. It will provide housing and places of work for nearly 4,000 people.

Vingroup announces new retail venture in electronics

A Vingroup official announced the establishment of the firm's new technology and electronics retail brand today called VinPro.

A group representative said opening the chain was part of the group's strategy to become a leading retail brand in Viet Nam, adding that it will open four VinPro stores in Ha Noi and HCM City on March 21.

The chain will have two models: VinPro and VinPro+. VinPro will be based in all Vincom trading centres, while VinPro+ will be built in various places in major cities and provinces across Viet Nam. The chain's products are categorised into seven groups: phones, computers, laptops, electronics, refrigeration, appliances and accessories.

Four-star hotel on Ly Son to serve growing tourism needs

The Muong Thanh Hotel Group will build a four-star hotel on Ly Son Island, 30km off the coast of the central province, as part of its 2020 tourism development project.

Le Dinh Dong, the group's deputy general director, said the project was scheduled to start this year. It would cost VND200 billion (US$9.5 million). The seven-storey four-star hotel would provide 150 rooms and meeting accommodation for tourists.

"It's part of our strategy to boost tourism on the island, as guest houses and homestay services cannot provide enough good accommodation for 3,000 visitors during the busy season," Dong said.

Samsung tops 500 fastest growing firms

The Vietnam Report and VietnamNet on March 9 released the FAST500 ranking list 2015 for the top-500 fastest growing firms in the country with Samsung Electronics Vietnam Co. Ltd taking the first place.

It was followed by Vietnam Electricity (EVN), Vietnam National Coal-Mineral Industries Holding Corporation Limited and Vung Ang Oil and Gas Petroleum JSC (VungAng PV Oil).

The average growth rate of the top 10 companies in FAST500 from 2013-2015 was 102.18%.

Vietnam Report also announced another list of the 500 fastest growing small and medium enterprises (SMEs). The top 10 SMEs reached an average growth rate of 82.29% in three consecutive years.

The FAST500 awards ceremony is set to take place on April 22 in Hanoi.

Japan’s IHI Corporation unveils strategic goal in Vietnam

The Japanese heavy industries leading corporation, IHI inaugurated its factory IHI Infrastructure Asia (IIA) in Dinh Vu Industrial Park in the northern port city of Hai Phong on March 10.

At the inauguration ceremony, IHI leaders unveiled its strategic goal that the move is considered to open up opportunities for the flows of capital and high-quality labour force within ASEAN member nations after the ASEAN Economic Community (AEC) is established late this year.

The US$34 million production facility is expected to meet regional infrastructure development demand and Vietnam’s modernization process.

Representative Director and Executive Vice President at IHI Corp Sadao Degawa  said the group will focus its investment in the fields of energy resources, environment, social infrastructure and offshore equipment in Vietnam.

He said IHI has strengths in multi-functional industrial machines and aerospace and defense equipment and is looking for projects in these fields in South East Asia, particularly in Vietnam.

Regarding huge opportunities created by the establishment of AEC, Mr. Ryutaro Yoshinari IHI Corporation General Manager, Hanoi Representative Office underscored the importance of the geographical location of the new factory in Hai Phong. He noted that IHI’s products from the factory will flow to markets in South East Asia. It will bring IHI huge benefits after the AEC is established.

Addressing the inauguration ceremony, Mr. Sadao Degawa expressed IHI’s pleasure to realise its commitment to accompany Vietnam in the country’s modernization process. He said after the IIA factory is put into operation, it will help IHI meet the demand of high quality steel structure for infrastructure projects in Vietnam.

“We hope to create favourable conditions for Vietnamese staff to manufacture high-quality products for both Vietnamese and global markets”, he emphasized.

Kasikorn Bank extends its Vietnam footprint

Thailand’s Kasikorn Bank recently further extended its footprint into the Vietnam banking and financial services market with the opening of additional branches in Hanoi and HCM City.

The launch of the branches on March 5th and 6th has unveiled the bank’s strategy to increase its presence by specifically targeting the niche market of Thailand businesses that have been rapidly expanding into Vietnam’s commercial and retail sectors.

For the past four years the bank has been nurturing the embryonic development of its banking activities in Vietnam through a strong alliance formed with VietinBank and Agribank under which it had established 147 branches nationwide.

The opening of these two additional branches is testimony to the banks determined commitment to further reach out to the Thai business community operating businesses in the country said General Director Preedee.

We are now in a position to offer a broader suite of banking products and services that will appeal to and better serve them while at the same time deepening and strengthening our presence in Vietnam, he said.

We appreciate the opportunity to have been granted a license to operate these two branches under the permit of the State Bank of Vietnam (SBV).

Deputy Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong in turn thanked Predee and other officials at the bank for making the decision to expand into Vietnam and affirmed that foreign banks have been instrumental to the development of the country’s banking system.

The opening of the branches in the lead up to the formation of the ASEAN Economic Community (AEC) later this year is a strategic move that will serve to strengthen cooperation and trade relations in the field of finance and banking, Hong concluded.

Environmental tax on petrol to jump 300%

An environmental tax on petrol and other fuel in Vietnam will rise by 300% after the National Assembly approved a tax hike to offset an expected shortfall in budget revenue.

The tax on gasoline and aviation fuel will rise from VND1,000 to VND3,000 a litre as of May 1.

The tax on diesel will rise from VND500 to VND1,500 a litre, while on fuel oil and lubricants will jump from VND300 to VND900. The tax on kerosene remains unchanged at VND300 a litre.

Environmental tax on fuel to be lifted by 300% on May 1.

Finance Minister Dinh Tien Dung said Vietnam has had to lower taxes on imported fuel in line with agreements with its partners in Asean, resulting in a significant shortfall in state budget revenue.

Petrol prices in Vietnam are between VND5,000 and VND6,000 a litre higher than in Laos and Cambodia, and also lower than China, which has given rise to smuggling.

“The tax increase on petrol and jet fuel is expected to boost state income by VND11trn a year,” Dung said.

“The move is also expected to encourage people to use biofuel, including E5 and E10 blends," he said. Ethanol is not covered by the tax increase.

"At the same time, petrol import taxes will also be decreased from 35% to 20%," Dung said.

The government wanted to use the extra money for its central budget, but the Assembly determined the additional revenue could only be spent on environmental protection measures.

EU-Vietnam FTA’s positive impacts on bilateral relations

Vietnam and the EU will continue the 12th round of negotiations on the EU-Vietnam Free Trade Agreement (EVFTA) on March 24 in Hanoi, which is expected the last session before the negotiations are concluded and the agreement signed.

The signing of the Agreement of Partnership and Cooperation and the EVFTA negotiations are positive signs in bilateral ties as Vietnam and the EU celebrate the 25th anniversary of diplomatic ties this year, said spokesman for the EC's Trade Office Joseph Waldstein Wartenberg.

Vietnam is a friendly and reliable partner of the EU and the EVFTA will promote growth for both sides, he asserted.

The EU is the second largest trade partner of Vietnam, with the two-way trade turnover reaching 27 billion Euros in 2013. Vietnam is the fourth largest trading partner of the EU in ASEAN and the 30th in the world. The nation’s exports to the EU increased by 28% during the 2009-2013 period.

Mr. Wartenberg added that the country is one of the most rapidly developing ASEAN countries and serves as an outstanding example of an open trade market.

With its young and skilled workforce, the country has great potential for trade and investment partnership with the EU, he said.

The official asserted that the EVFTA is an ambitious and comprehensive deal in terms of goods, services, investment and government purchase. Apart from the removal of tariff and non-tariff barriers, both sides are working to settle other issues related to trade, legal matters, competition, intellectual property, and geographical indication, he revealed.

He also expressed his appreciation of Vietnam’s commitment to economic and political reform, affirming that the EU will continue assisting Vietnam in the process through the EVFTA.

Mr. Warternberg said that besides tax and trade barriers, negotiations would focus on legal issues, competitiveness and other issues related to intellectual property rights.

Other regulations on the labor and investment environment as well as a legal framework involving civil organizations will also be negotiated.

Vietnam should commit to protecting and managing sustainably its biodiversity and forests, preventing illegal logging as part of its efforts to fight climate change, he suggested.

A better future is percolating for Dak Lak coffee

Coffee is grown widely throughout districts in Dak Lak province and a cup of freshly brewed Buon Ma Thuot in particular has a rich coffee aroma and taste that is favoured globally.

According to statistics from the Dak Lak People’s Committee, more than 64% of the province’s population – over 1 million farmers – grow coffee as their primary source of income.

The coffee industry also generates more than 500,000 jobs, in addition to farmers, and the region produces more than 1.5 million tonnes of it annually, contributing to around 40 per cent of the nation’s production.

Last year, coffee from the province was shipped to 60 countries worldwide with an export value of US$650 million and accounted for 90% of the total exports of the province.

Today Buon Ma Thuot coffee benefits not only from its brand name identification but from its geographical identification as well and the region is generally considered the coffee metropolis of Vietnam.

Coffee was first introduced to the region by French colonists in 1857. With ideal growing conditions, coffee from Buon Ma Thuot, known then as CADA coffee farms, gained a reputation for its superior taste characteristics between the 1920s and 1930s.

Vietnam’s global success in coffee, however, was sparked following the Vietnam government’s move to liberalise the economy in 1986. Coffee production has since expanded rapidly.

At present, Phuoc An company owns the areas once known as the CADA farms. The company was established in 1976 and it still preserves some vestiges of the original CADA farm and some processing equipment used during the 1950s.

Phuoc An is a state-owned enterprise that has divided the plantations into areas of a few hectares each and are allocated to worker families under a long-term use contractual agreement.

Phuoc An provides technical services like seedling selection, farming techniques, quality control, providing production materials and possibly credit support to workers paid back by coffee beans.

Working with global companies like Kraft Foods and Nestlé, Phuoc An along with other relevant agencies has been able to modernise its cultivation and processing technologies and spread the concept of sustainability.

Large multinational companies need to ensure they have access to a long-term supply of quality beans for their instant blends. Kraft Foods, one of the two largest buyers of coffee in the world, has pledged to buy all of its coffee for its European brands from sustainable sources by 2015.

The spectacular growth of the coffee industry in Vietnam has been in reality the result of working with global multinationals to ensure quality and sustainability said Trinh Duc Minh, chairman of the Buon Ma Thuot Coffee Association.

This relationship has directly led to Central Highland coffee becoming famous around the globe for its good quality and special flavour.

Provincial authorities in the Central Highland region always pay exacting attention to quality coffee production and sustainability, he said adding they have been successful in launching overseas marketing programmes.

Vice Chairman of the Dak Lak provincial People’s Committee Dinh Van Khiet echoed Minh’s sentiments and said sustainability and global integration have led to a better future brewing for the coffee industry.

There are still many challenges to a sustainable coffee industry in Vietnam, but if all actors in the supply chain work together, they can achieve a thriving, sustainable industry for generations to come.

Nghe An promotes local tourism potential

The 2015 Hoang Mai Tourism Season was launched at a ceremony to introduce coastal Hoang Mai town in central Nghe An province.

The event was held during the Con Temple festival on March 10 that attracted representatives from the Ministry of Culture, Sports and Tourism, local cultural officials and crowds of tourists.

Hoang Mai, home to numerous renowned cultural and relic sites and landscapes, such as Con Temple, has devised incentives to lure investment in tourism development, one of the province’s key economic areas.

A wide range of activities, including photo and bonsai exhibitions and boat races, have been held across the town to mark the season.

Nghe An has targeted around 100 trillion VND (4.7 billion USD) in investment, including 50 trillion VND from foreign direct investment (FDI) from 2015-2020.

To that end, the locality will enact measures to lure investment projects, considering it an essential step to spurring local socio-economic development.

It will facilitate investment operations by zoning off land, providing incentives and assisting in worker recruitment.

Nghe An will also continue improving its investment environment, working towards achieving its goal to rank among the top 30 provinces and cities nationwide in the provincial competitiveness index.

Last year, Nghe An granted investment licenses to 105 projects worth more than 18.5 trillion VND (880 million USD), a 45.83 percent increase in the number of projects and a 43.74 percent increase in value from the previous year.

Some of the large-scale projects include the Hanoi-Kim Liem urban and hotel complex (720 billion VND), Lan Chau-Song Ngu eco-tourism complex (1.97 trillion VND), and Thanh Thanh Dat wharf (560 billion VND).

Ho Chi Minh City boosts trade, investment in Cambodia, Myanmar

The Ho Chi Minh City Investment and Trade Promotion Centre (ITPC) will organise a wide range of activities in Cambodia and Myanmar during 2015 to promote trade and investment in the nations, said ITPC Director Pho Nam Phuong at a seminar on March 10.

Accordingly, the centre will hold a Trade-Service-Tourism Exhibition (Ho Chi Minh City Expo) in Battambang province, Cambodia, from April 1-5.

It will aim to create favourable conditions for the two countries’ enterprises to expand business cooperation for mutual benefit, as well as supporting Vietnamese companies in evaluating the market and seeking cooperation opportunities in Cambodia’s northwest region.

The Ho Chi Minh City Expo in Cambodia is expected to draw 90 Vietnamese enterprises showcasing their products at 150 booths.

Meanwhile, the Expo in Myanmar will take place in Yangon from May 20-24 with over 100 booths for around 80 businesses. This will be the fourth time the ITPC has held an investment and trade programme in Myanmar.

In addition, the centre will also organise seminars to introduce Vietnamese products and exchange programmes with local business associations.

Sharp rise in farmed pigs, chickens in Dong Nai province

The southern province of Dong Nai is currently farming more than 1.4 million pigs and 13 million chickens, an increase of over 1 million apiece from a year before, according to the provincial Veterinary Sub-department.

Such a leap is attributable to price increases over the past year, encouraging farmers to expand their operations.

Each day, Dong Nai farmers supply the market with nearly 7,000 pigs (equivalent to about 700 tonnes), 84,000 chickens (over 120 tonnes), 1.7 million chicken eggs, and 1.1 million quail eggs.

Dong Nai is among the top food purveyors in the south of Vietnam with 60-70 percent of its pigs and chickens sold in Ho Chi Minh City and neighbouring provinces.

Local pork and chicken meat are priced 2,000-3,000 VND (0.09-0.14 USD) per kilogramme higher than those of other provinces due to its superior quality, the Veterinary Sub-department said.

It added that almost all chickens, quails, and pigs in the province are raised at farms, noting that 2,800 books were handed over to local farms by the end of February to assist them in recording their livestock.

The agency has so far recognised 263 farming facilities as free of disease, including 152 chicken farms and 111 pig farms. The recognition was said to help awarded farms secure contracts and easily deliver products.

Quang Binh seeks investment for major projects

The central province of Quang Binh is calling for investment in a dozen major projects in tourism, industrial production and infrastructure, and trade development in 2015.

Specifically, the Bao Ninh ecological tourist site and amusement park in Dong Hoi city need around 35-40 million USD and 80-100 million USD, respectively.

The Da Nhay – Ba Trai resort complex in Bo Trach district requires over 80 million USD in investment capital, while the Bao Ninh – Hai Ninh high-end tourism site in Quang Ninh district needs 100-120 million USD.

The high-tech electronic equipment production park in Quang Ninh district and the Hon La 2 industrial park in Quang Trach district are looking for at least 80 million USD each.

Meanwhile, the Le Thuy seaport and industrial park in Le Thuy district require 1.5-2 billion USD to build infrastructure and serve business services.

Director of the provincial Department of Planning and Investment Le Van Phuc said local authorities will implement policies to support investors in terms of land clearance and human resources training.

Thai Nguyen economy sees strong results in first two months

The industrial production index of the northern province of Thai Nguyen increased tenfold in the first two months of 2015 from the same period last year, according to statistics provided by the provincial People’s Committee.

Of the industries, cement saw a 50 percent annual increase while garment and steel posted rises of 48 and 108 percent, respectively.

In addition, the Samsung high-tech complex in the province achieved substantial growth, producing 15.4 million smart phones and 3.9 million tablet computers.

Over the last two months, the province’s export revenue reached 3.3 billion USD, with smart phones accounting for 72 percent.

State budget collection hit an estimated 1.4 trillion VND (65.7 million USD), up 91 percent from last year and meeting 50 percent of the yearly plan in the first two months alone.

Over 200 new enterprises were established, bringing the total number of newly-established businesses in the province to over 4,000 with more than 30.6 trillion VND (1.4 billion USD) in capital.

To reach the 2015 socio-economic targets, Thai Nguyen will take various steps related to laws and policies, planning, infrastructure, human resources, site clearance and administrative reform, according to chairman of the provincial People’s Committee Duong Ngoc Long.

24,000 firms pay taxes electronically

Nearly 24,000 firms from 14 cities and provinces have paid their corporate taxes electronically since the e-filing system was launched over a year ago, said General Director of Taxation Bui Van Nam.

The platform collected more than 14 trillion VND (667 million USD) for the State budget, said Nam, addressing a signing ceremony between the General Department of Taxation and 15 commercial banks, including HD Bank, A Chau Bank, ABBank, Saigon bank, Maritime Bank, VIB, Techcombank, VIP, SHB, SeABank, Tien Phong Bank, Lien Viet Post Bank, MHB Bank, Sacombank and Ban Viet Bank.

As stipulated in the new agreement, both sides will launch a system to share, receive and process tax payment data.

Nam said the move was made to ensure that 90 percent of enterprises nationwide pay taxes through the e-system this year.

Between now and late 2016, the tax sector aims to sign similar deals with all banks operating in the country, he added.

Work commences on platform supply vessel of Dutch company

The Ha Long Shipbuilding Co. Ltd began construction on a platform supply vessel PSV 3300 for the Netherlands’s Damen Shipyard Group in the northern coastal province of Quang Ninh on March 10.

The ship, designed by Damen, specialises in servicing offshore oil rigs and is able to serve fire fighting and oil collection purposes.

The vessel, 80 metres long and 16.2 metres wide, has a 728-square-metre main deck and deadweight of 3,500 tonnes. It can travel at 13.5 nautical miles per hour and operate continuously for 28 days at sea.

It is said to own preeminent features and only a limited number of shipbuilders in the world are capable of building this PSV 3300 series.

In December 2014, the Ha Long Company, an affiliate of the State-owned Shipbuilding Industry Corporation (SBIC), completed the construction of four tugs for the Damen Group.

The Dutch company formally began its cooperation with SBIC, formerly known as Vietnam Shipbuilding Corporation or Vinashin, over a decade ago.

Rice purchase in Mekong Delta meets 8 percent of plan

Provinces in the Mekong Delta have so far fulfilled only nearly 8 percent of the government plan to purchase and stockpile one million tonnes of rice in the winter-spring crop 2014-2015.

At a meeting on rice production in Can Tho City on March 10, Huynh The Nang, general director of the Southern Food Corporation, reported that 128 traders joining the stockpiling programme have purchased 79,360 tonnes of rice, far behind the pace of harvest.

Nang blamed the slow purchase on the fact that small trading businesses have faced a lot of barriers in getting loans from banks.

He said until now no specific solution has been in sight for the problem.

He recommended that local authorities should get involved more to help remove obstacles and accelerate the pace of the programme, which aims at maintaining rice price at profitable level for farmers during the harvest season.

Dao Anh Dung, vice chairman of Can Tho city’s People’s Committee, added that another difficulty for the programme is a lack of drying facilities.

He also said many local canals have filled up, hindering the movement of boats, a common means of transporting goods in the region.

Total retail sales of consumer goods and services exceeded 542.6 trillion VND (25.83 billion USD) in the first two months of 2015, an annual increase of 11.4 percent, reported the Ministry of Industry and Trade (MoIT).

Nearly 413.2 trillion VND (19.67 billion USD) was generated through trading activities, representing a 10.6 percent annual increase and 76.2 percent of the total figure.

The hotel and hospitality sector contributed over 64.2 trillion VND (3.06 billion USD), or 11.8 percent of the two-month revenue while services accounted for 11.2 percent at 60.8 trillion VND (2.89 billion USD). They posted respective increases of 12.5 percent and 16.5 percent from a year earlier.

Tourism accounted for only 0.8 percent of the total retail sales with 4.5 trillion VND (214.3 million USD), up 0.4 percent from the same period in 2014, the MoIT said.

In February alone, retail sales were valued at more than 276 trillion VND (13.14 billion USD), a 3.7 percent rise from January.

In anticipation of the Lunar New Year, February saw substantial increases in consumer goods purchases such as household utensils, apparel, footwear, food, and soft drinks.

An array of promotional programmes were offered by businesses in February to stimulate purchasing power and the supply of goods and services at supermarkets and traditional markets were ensured, the ministry said.

Industrial output up 12 percent in early 2015

Annual Vietnamese factory production increased 12 percent within the first two months of 2015, according to the Ministry of Industry and Trade.

Increased output was seen in nearly all sectors; the processing-manufacturing and electricity generation-distribution sectors grew between 12-14 percent from the same period last year.

Notably, seafood processing recorded a production growth of almost 21 percent.

February alone saw a 7 percent increase in industrial production index, despite a nine-day Lunar New Year holiday.

As of February 1, inventory was also following the upward trend, with stored optical and paper products soaring by 122 and 57 percent, respectively.

Efforts exerted to equitise 432 State firms

The complete equitisation of 432 State-owned enterprises (SOEs) will be the core task of the Steering Committee for Business Innovation and Development in 2015, announced Committee Head and Deputy Prime Minister Vu Van Ninh during the release of the group’s main tasks for 2015.

This year, the committee will continue consulting with the Government to improve policies on arranging, innovating and restructuring and supervising State firms.

In the first quarter, the group will focus on inspecting and determining the enterprises to be equitised and in the third quarter it will design a master plan on restructuring SOEs from 2016-2020 to be submitted to the Prime Minister.

Accelerating the completion of a master plan on the rearrangement of agricultural and forestry companies by the second quarter of this year will also receive major attention.

The restructuring of the Vietnam Shipbuilding Industry Group (Vinashin) will be the focus of the committee this year.

It will also intensify information dissemination to create consensus among sectors, enterprises and people in restructuring SOEs.

Over 200 enterprises join coffee exhibition-fair

A coffee exhibition-fair 2015 opened on March 9 in the Central Highlands province of Dak Lak as a part of the ongoing fifth Buon Ma Thuot Coffee Festival 2015, drawing the participation of 235 local and foreign enterprises.

Y BhamEnuol, Vice Chairman of Dak Lak’s People’s Committee, said the companies run over 700 booths at the fair, displaying a wide range of goods from coffee beans to production lines.

This is one of activities to promote Vietnamese coffee brands in general as well as Buon Ma Thuot coffee brands in particular to local and international friends, he said.

The event will last until March 12.

Dak Lak, with Buon Ma Thuot as the capital city, is the largest coffee producer in Vietnam, boasting a coffee-growing area of 204,390 hectares and producing 450,000 tonnes of coffee annually.-

Self-assessment tool introduced for business associations in Vietnam

The Vietnam Chamber of Commerce and Industry (VCCI) and the Asia Foundation co-organised a workshop in Hanoi on March 6 to introduce best practices and a self-assessment tool for business associations in Vietnam.

The tool is aimed at helping business associations evaluate their capabilities and make comparisons between their activities and international norms and practices, said Pham Ngoc Thach, a VCCI official.

The assessment tool has been built based on the research team’s consultations with experts and their intensive interviews with 16 local business associations on seven topics: providing services to members; developing an effective operational model; applying information technology and communication; managing the associations; international links; building the sectoral standards; and criticism and contributions to law and policy making.

Vietnamese enterprises, 97% of which are small and medium-sized, need to boost connections to enhance their competitiveness, thereby taking advantage of opportunities to join the global value chain, said Vice President of the VCCI Hoang Van Dung.

The workshop also introduced useful lessons of successful experiences from business associations in Vietnam, so that other associations could use them as reference and apply them to their operations.

At the event, the Asia Foundation announced sponsorship programmes to help Vietnam’s business associations improve their activities through following good practices or realising their own development initiatives. The sponsorships, worth between US$15,000-20,000 each, will be implemented in 12 months from June 2015 to May 2016.

HCM City seeks ministry backing for major transport projects

Leaders of HCMC have proposed the Ministry of Transport fund a number of key infrastructure projects that can help the city deal with traffic bottlenecks.

The projects were put on the table for discussion at a meeting between Transport Minister Dinh La Thang and HCMC vice chairman Nguyen Huu Tin in the city on Wednesday.

Tran Quang Lam, deputy director of the HCMC Department of Transport, suggested the ministry allocate funds for projects to build a road connecting Vo Van Kiet Boulevard and HCMC-Trung Luong Expressway, and upgrade and widen the National Highway 50 section in HCMC, and An Phu and My Thuy interchanges.

The city also wanted to use the loans provided by the Japan International Cooperation Agency (JICA) for metro projects 3A and 3B, and accelerate capital allocation for Binh Loi railway bridge spanning the Saigon River and the elevated rail road section from Hoa Hung to Binh Trieu.

At the meeting, Thang threw support behind construction of the road linking Vo Van Kiet Boulevard and HCMC-Trung Luong Expressway. However, the minister requested the city to draw up a feasible toll collection plan to raise funds for this project and carry it out in phases if the city cannot mobilize enough capital at a time.

The ministry approved adding an expansion of the National Highway 50 section to the ministry’s plan for capital allocation in 2016-2020.

Regarding the My Thuy interchange project, Thang recommended HCMC seek approval from the Government to ease traffic congestion at the interchange.

Thang agreed the municipal government could evaluate the components of metro projects under the management of the ministry so as to speed up their progress.

Foreign investors pull out of major property project

The government of HCMC has agreed on a proposal by a consortium comprising Hongkong Land and Sumitomo & Development to withdraw from developing a land lot at a prime location in the central commercial business district.

In a report issued on Tuesday, the city government confirmed the pullout by the two foreign firms and assigned the HCMC Department of Planning and Investment to report to the Prime Minister and the city’s Party Committee.

The city plans to hold a tender to select new investors for the land lot covering nearly 9,800 square meters at 164 Dong Khoi Street, District 1 at the corner of Nguyen Du and Dong Khoi streets and in front of the Notre Dame Cathedral.

Nearly 70 companies explored the possibility of developing the site in 2009. In July 2013, the consortium of Hongkong Land and Sumitomo & Development was chosen by the city to develop a complex consisting of office space, hotel and sections for financial services and exhibitions. The project was estimated to cost nearly VND7.2 trillion at that time.

The location used to be the premises of the HCMC Department of Culture, Sports and Tourism.

Rice exports tumble in Jan-Feb

Vietnam exported 526,000 tons of rice worth US$243 million in the first two months of this year, plunging by 34% in value and 33.1% in volume compared to the same period last year, according to the Ministry of Agriculture and Rural Development.

Data of the ministry showed that the nation earned only US$90 million from selling 200,000 tons of rice in February.

Enterprises reported lower rice shipments in the first two months. For instance, An Giang Plant Protection Joint Stock Company sold more than 4,590 tons of rice to foreign markets in January, down 18.7% over December last year, according to the news site VnExpress.

Huynh Minh Hue, general secretary of the Vietnam Food Association (VFA), acknowledged that local firms had found it hard to export the food staple due to rising competition, falling demand in importing countries, and the small remaining volume of rice contracted last year.

On top of that, China, the biggest importer of Vietnamese rice last year, has strictly controlled and limited rice shipments via border gates to diversify export sources with low prices from India, Pakistan and Myanmar.

Hue was quoted by VnExpress as saying that it is not easy to predict demand of China this year as the northern neighbor has not announced its rice import quotas for this year. Besides, local exporters are facing a series of difficulties in boosting sales in other major markets of Vietnam.

Africa is among the main importers of Vietnamese rice, but Vietnam lost 60% market share to Thailand and India last year. This year, Vietnam can maintain its market share for fragrance rice while Thailand dominates the African market owing to the competitive prices of its stockpiled rice.

“Now is the start of March but the number of orders has not increased. Therefore, rice shipments in the first quarter of this year may not reach the target set earlier this year,” Hue said.

However, dropping rice exports left little impact on the enterprises assigned to implement government-to-government contracts in the period.

Nguyen Tho Tri, deputy general director of Vietnam Southern Food Corporation (Vinafood 2), said outbound rice sales at the firm were stable as it won contracts to sell 300,000 tons of rice to the Philippines and 30,000 tons to Malaysia.

To support farmers and exporters to sell rice, the Government last month allowed the ministry to implement a major scheme to stockpile one million tons of rice from March 1 to April 15 this year.

Vietnam exported 6.5 million tons of rice with total FOB (free on board) revenue of US$2.84 billion last year. Of the volume, China accounted for 2.1 million tons (32%), the Philippines 1.4 million tons (21%), Africa 800,000 tons (12%), Malaysia 450,000 tons, Cuba 300,000 tons and other markets some 1.1 million tons.

Businesses concern about electricity price increase

According to the Ministry of Industry and Trade, the electricity price increase of 7.5 percent from March 16 will push up production costs at businesses by 0.2-0.8 percent. However, many companies said the ministry’s calculation should comprise the hike in production costs of materials for their production.

Those that will be most affected from the electricity price hike are from steel, cement, paper industries and material producers.

According to Vietnam Steel Association, electricity accounts for 7 percent in production costs of a ton of steel billet, which consume an average of 400-600 kWh of electricity. A ton of steel needs 70-80 percent steel billets. As a result, the electricity price increase will directly impact steel production costs and the product price will be forced to surge in the time ahead.

Mr. Le Quang Hung, director general of Saigon Garment Manufacturing Trading Joint Stock Company, said that electricity price hike will directly affect the enterprise's material supply sources.

For instance, weaving, dying, fiber plants are consuming much energy. Electricity price raise will accelerate their production costs, bringing about higher prices of garment products. Meantime, purchasing power on the market has strongly dropped, making the affect to businesses heavier.

Mr. Nguyen Dinh Dong, deputy director general of the Southern Rubber Industry Joint Stock Company, said that export contracts of businesses had been signed last yearend or early this year. Therefore they can not increase their prices immediately despite of power price increase.

Material suppliers will meet with difficulties when electricity price suddenly moves up but they can not sell their materials at higher prices.

Mr. Tran Anh Hao, official from the HCMC Department of Industry and Trade, said that the impact of up electricity price depends on production technology level of businesses. In fact, Vietnam’s production technology level is low.

A recent survey carried out by the department shows that only one percent of manufacturers in the city have advanced technologies, over 50 percent at medium level and the rest are outdated or very outdated.

This is the main factor that will reduce the competitiveness of businesses in the market.

The electricity price increase is necessary to prompt businesses to improve their technologies, aiming to save electricity. However the Government should minimize impacts from that to production with flexible price management, he added.

Power prices should be edged up during dry season and cut down during rainy season. This will help businesses have more suitable production plans, he proposed.

Deputy Head of the Central Institute for Economic Management Vo Tri Thanh said that it is suitable time for the Government to raise electricity price this month because the world petrol prices have been reducing.

The power price increase will not result in large fluctuation in the market and can speed up investment attraction for thermal electricity, he said.

It is unable to further exploit hydropower sources forcing the Government to develop thermal power. For the last several years, they have called on investors but the investors said that electricity purchasing prices from thermal power plants are low and unattractive.

However the power price should be clearly and publicly calculated and increased in a suitable route so that businesses can regulate their production and business activities, he said.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR