Hanoi offers opportunities for Eropean investors

The Hanoi authorities will create the most favourable conditions for investors to do business in the city, contributing to making Hanoi a city of peace, friendship and dynamic development.

Addressing a meeting held by the European businesses community in Hanoi on Sept. 9, Chairman of the Hanoi People’s Committee Nguyen The Thao affirmed the authorities will unceasingly create a transparent investment climate and further carry out administrative reform.

He briefed the Hanoi socio-economic development master plan till 2020 and orientation to 2030, saying that the city will promote attraction of foreign investment with focus on high-tech, health, education.

For the European Union, the city calls for investment in fields of its strength such as development of high-quality services, financial-banking and trade centres, electronics, informatics industries, high-tech industrial and supporting industry zones, tourism and resort projects, education, health and environment, he added.

Hanoi is home to 2,100 foreign invested projects with a total registered capital of US$19.9 billion. The projects mainly involve in real estate worth $8.1 billion, processing and manufacturing worth $1.6 billion, and entertainment worth $930 million.

The EU alone with 14 countries investing in Hanoi has 226 projects with registered capital of US$1.5 billion. France is leading the bloc with 58 projects, followed by Germany with 35 projects and Denmark with 34 projects.

Investors seek alternative channels as rates drop

With profits from bank savings down as rates on deposits have been cut, many investors are considering transferring their money to other channels such as gold, stocks, and foreign currencies.

For economic expert Dinh The Hien, the reduced deposit rates are good news to stock investors.

Since the saving rates were losing its attractiveness, people would turn to other investment channels, including the stock market, he explained.

“The new investment flow will help increase the stock market’s liquidity,” he said.

Doctor Nguyen Van Thuan from the Ho Chi Minh City Open University said lending rates would soon fall down along with the lower deposit rates.

This would have positive impacts on the operation and production of the businesses and would bring better business results for the listed companies, he said.

However, Thuan added that the stock market still needed other factors for revitalization and it was still not appealing enough.

“The unstable macro-economy, high inflation and the businesses’ internal problems are what make investors hesitant in sending their money to the stock market,” he said.

Meanwhile, many investors have invested in foreign currencies with the hope of earning profits when forex rates soared at the end of the year.

However, analysts warned that it would be unlikely for investors to earn from the exchange rate fluctuation as the State Bank of Vietnam had affirmed that forex rates would be managed in a sustainable way.

The national foreign reserves have been restored and the central bank is capable of intervening to stabilize the market, they said, adding that forex rates would be hiked by no more than 1 percent as ordered by the central bank.

As for gold investment, Tran Thanh Hai, CEO of the Vietnam Gold Business Corporation, also warned investors to be careful as gold recently followed an unpredictable development.

For his part, economic expert Huynh Buu Son said bank savings were still an attractive investment channel.

He said the deposit rate of 14 percent a year was not too low and it was suitable for people with investment of less than VND200 million, which was not enough to invest in real estate.

It was also more profitable than deposits in foreign currencies with the saving rate of only 2 percent a year, he added.

Truong Van Phuoc, CEO of Eximbank, also said lenders could still earn profits with the current deposit rate as inflation was likely to soar in the coming time.

Panasonic considers Vietnam a strategic market

Japanese electronics and home appliances producer Panasonic will build two more factories in Vietnam with a view to turning Vietnam into its key market in Southeast Asia, Nikkei newspaper said.

Panasonic planned to build a refrigerator factory near its existing facility in Hanoi . Once operational in October, 2012, the new facility will raise the group’s annual output in Vietnam to 800,000 units, doubling its current capacity.

The Japanese group will also construct a new washing machine factory in the northern province of Hung Yen with a production of 800,000 units per year. The factory is scheduled to be put into operation in April, 2013.

In addition, Panasonic will open a R&D centre to develop products for domestic customers.

According to Panasonic, Vietnam is an attractive market for Japanese electronics and home appliances producers, as only 10-30 percent of its almost 90 million population have used refrigerators and washing machines.

PetroVietnam launches drilling rig, oil platform

The Vietnam National Oil and Gas Group (PetroVietnam) has launched the first 90m water-depth jack-up drilling rig and the Moc Tinh oil rig at the Vung Tau Petroleum Port.

State President Truong Tan Sang joined leaders of ministries and agencies and representatives from the Russian Embassy and the Russian Consulate General in Vietnam at the launching ceremony, which was held on the occasion of the 50 th anniversary of PetroVietnam (Nov. 27).

The drilling rig is a key national mechanical project with PetroVietnam as the investor and PetroVietnam Marine Shipyard as the EPC contractor.

Vietnam has become one of the three countries in Asia and of ten nations worldwide to build jack-up drilling rig of international standards recognised by the American Bureau of Shipping (ABS),

As one of national key projects, the Moc Tinh oil rig is designed and manufactured by Petroleum Equipment Assembly and Metal Structure JSC (PVC-MS). This is the largest oil platform in Vietnam with a total weight of over 14.000 tonnes.

At the ceremony, the Russian-Vietnamese oil and gas joint venture, Vietsovpetro, signed a contract with PV Shipyards, under which another 90m jack-up drilling rig will be built by the later.

Vietnam rambutan exports rise along with quality

With the adoption of quality agricultural practices in the country, Vietnamese rambutan fruit can now meet the technical standards required to enter exacting markets like the US and the EU.

The Ministry of Industry and Trade said rambutan accounts for the largest export earnings of any fruit, topping US$2.5 million last year and $1.8 million in the first half of this year.

Fruit exporters said many markets, including the United Arab Emirates, Korea, and the Netherlands were eagerly buying Vietnamese rambutan thanks to the improving quality.

Farmers in Mekong Delta provinces are also waiting for their first batches of rambutan to enter the US market since getting export licenses in April.

Nguyen Van Lap, head of the Tan Khanh rambutan cooperative in Vinh Long Province, said its 39 household members tending 31 hectares had obtained Global GAP (good agricultural practices) certificates, enabling export to the US.

In Ben Tre and Tien Giang Provinces, hundreds of farmers are waiting to harvest 80 hectares of Global GAP-certified rambutan for exports.

With quality ensured, exporters said the next thing to consider was the timing of the exports.

Nguyen Thi Hong Thu, head of the Ben Tre-based Chanh Thu Co, said Vietnamese exporters could not compete with their Mexican and Thai rivals during the latter’s main fruit season.

“It costs $6 for a kilogram of [our] rambutan to enter the US, taking the retail price to $10, while the Mexican fruit is sold at only $2 there,” she said.

Vuong Dinh Khoat, director of An Phu Irradiation Co, explained that the Mexican fruit was much cheaper since the exporters did not have to spend much on transportation, while Thailand had 30 years’ experience in exporting rambutan to the US.

So, fruit exporters said, Vietnam should export rambutan to the US at a time when the fruit season was over in other countries.

This was completely feasible since rambutan could be grown at any time of the year in Vietnam, they said.

Thai businesses seek partners in Vietnam

Thai enterprises want to seek Vietnamese relevant partners to set up trade ties, said Dr. Sakda Siriphattrasophon, who is head of a Thai business delegation visiting Ho Chi Minh City from September 8-11.

The delegation includes 40 Thai prestigious enterprises specialising in apparel, cosmetics, food, agricultural products, machinery, equipment, chemicals and materials.

The Thai firms inquired into socio-economic development, business climate, market demand as well as information relating to laws, business, investment, labour, tax, financial management in Vietnam at a talk on opportunities for business and trade exchange between Vietnam and Thailand on September 8.

The bilateral trade ties between Vietnam and Thailand saw unceasing growth over the past years, reaching US$7.2 billion in 2010.

Construction of Hai Duong thermoelectric project starts

The Malaysian owned Hai Duong JAKS Electricity Ltd Company held a ground-breaking ceremony on September 9 to begin the construction of the Hai Duong Thermoelectric power project.

Present at the ceremony were National Assembly Vice Chairperson Nguyen Thi Kim Ngan, Deputy Prime Minister Nguyen Thien Nhan and the Malaysian Ambassador.

During the ceremony Deputy PM Nhan praised Hai Duong’s efforts in attracting numerous foreign investors (currently 216 foreign invested projects). He said that when the project is put into operation it will provide abundant electricity for Hai Duong in particular and Vietnam in general.

He added that the project contributes to strengthening trade ties between Vietnam and Malaysia.

He also urged Hai Duong province to create the best conditions for the project to be completed on schedule, especially land clearance. He noted that both the province and the investor should pay specific attention to social welfare conditions, particularly generating jobs for local people and following Vietnam’s laws.

The US$2.2 billion-project is the largest foreign invested project in Vietnam so far. It will be built on an area of 300 hectares in the villages of Phuc Thanh, Quang Trung and Le Ninh in Kinh Mon district.

The first generator of the project, with capacity of 600MW, will be put into operation in the fourth quarter of 2016, while the second generator is scheduled for operation in the second quarter of 2017.

Vietnamese toys grab home market from Chinese

Vietnamese toys seem to have captured the domestic market from their Chinese counterparts ahead of this year’s Mid-Autumn Festival.

Tran Xuan Noi, owner of toy shop No 49 in Hanoi’s Hang Ma Street, said Chinese still filled shops but the most popular with children were Vietnamese toys like the TOSY spinning top and boomerang, the Winwin Toy, Tiditoy, and ETIC’s wooden toys.

This was for the first ever time that Vietnamese toys outsold Chinese ones, he said.

“This is a good first step for Vietnam to wrest back the market which was long dominated by Chinese toys,” he said.

Though TOSY’s tops made their debut only a month ago, they had achieved impressive sales, he said.

TOSY’s sales of several dozens a day have been much higher than that of the Chinese toys which dominated last summer, like the AI Football GGo, ARMO Hero, and Fruity Robo.

Its producer, Tosy Robotics JSC, said it sold around 40,000 in July alone and had received orders for more than 50,000 from foreign partners during this Mid-Autumn Festival.

Many Hanoi sellers said Vietnamese toys were very competitively priced compared with foreign products.

AI Football GGO and Fruity Robo figures cost around VND899,000 (US$45) and VND395,000, while a TOSY boomerang cost only VND129,000, the top was VND299,000, and the wooden items were around VND300,000, they said.

Other imported toys such as the Japanese Bey Blade spinning top, Denmark’s Lego, and the US-made Barbie dolls cost up to a couple of million of dong.

Vietnamese toy makers also paid much attention to safety, the sellers said.

The wooden toys had their sharp edges carefully pared while the plastic toys were made of high-quality materials that were non-toxic and not as brittle as that used in Chinese toys, they said.

Chinese toy makers usually took advantage of cartoons shown on Vietnamese TV to sell related toys, they said.

AI Football GGo, ARMO Hero, and Fruity Robo were all popular after cartoons with the same names began to be shown.

But while this initially helped, sales slumped after the cartoons went off the air, they said, adding this gave Vietnamese toys the chance to grab market share by focusing on quality, eye design, and competitive pricing.

The Mid-Autumn Festival is being celebrated today.

Approving Dinh An economic zone plan

Deputy Prime Minister Hoang Trung Hai has approved a grand plan for construction of Dinh An economic zone in the Mekong Delta province of Tra Vinh until 2030.

This is one of 15 coastal economic zones in the country, which focus on industry, commerce, services, tourism, urban development and agriculture-forestry-fisheries and other areas closely connected to marine-based economy.

Dinh An economic zone has a total area of over 39,000 hectares, covering Tra Cu and Duyen Hai districts. Its population will reach 206,000 by 2020 and 250,000 by 2030.  

Tran Khieu, Chairman of the Tra Vinh provincial People’s Committee, said Dinh An economic zone will open up many opportunities for economic development in the locality and in the Mekong Delta as a whole.

The province will create favourable conditions for investors to operate effectively and contribute to improving the living standards of local people, he emphasised.

Vietnam prepares for renewable energy phase

Fifty percent of businesses in Vietnam were ready to invest in renewable energy sources, according to the survey report of Grant Thornton auditing and consulting company on Sept. 9.

In its report, the company showed that the insecure situation in the Middle East and North Africa had affected world oil prices, adding that 44 percent of business over the world would support their governments in renewable energy and producing new energy sources.

The report said that the trend opened a great opportunity for Vietnam , a country with regular winds, over 3,300 kilometres of coast and 2,000-2,500 hours of sunlight every year, which were advantageous for producing energy.

Governments in Southeast Asia promoted research to find replacement fuels as well as appealed to people to protect existing resources.

According to Grant Thornton’s survey, Thailand, Malaysia, China and the Republic of Korea had developed sustainable energy sources as part of their national policies in recent years.

Most commercial banks already cut lending rates

There have been 34 out of 42 commercial banks cutting lending interest rates and spreading new guidelines and specific regulations on the matter throughout their networks, said Monetary Policy Department under the State Bank of Vietnam (SBV).

They have also asked their branches to strictly follow the ceiling depositing rates of 14 percent per annum for Vietnam dong and 2 for US dollar set by the central bank, prohibiting any negotiations with customers for higher depositing and lending rates, Saigon Tiep Thi newspaper reported.

Among them, about 20 commercial banks, including Argribank, Vietinbank, BIDV, Vietcombank, Eximbank, Ocean Bank, Navibank, SBV, VietBank, TienPhongBank, PG bank, Seabank, GP.Bank, OCB, SHB, Techcombank, Maritime Bank, VIB, VP Bank and Bao Viet, have issued specific guidance on monitoring and processing the observance interest provisions.

Thus, the branches of those banks must proactively detect the credit institutions of unfair competition with violations in the interest rates in both VND and US dollar to report to the local central bank's branches.

In addition, the banks’ head offices also have to strengthen the inspection mechanims for depositing rates at their branches, and strictly impsoe punitive measures on the managers and personnel of branches and transaction offices failing to abide by the direction of the SBV.

Before the quarterly conference of the banking sector held earlier this month, five commercial banks, including BIDV, SHB, VP Bank, ABbank, and Eximbank, have reduced lending rates for agriculture and rural development, and certain groups of exporters by 1-2 percent to 17 -19 percent a year.

The recent agreement at the conference has added other 6 commercial banks, Vietinbank, Vietcombank, MHB, MBbank, LienVietBank, Maritime Bank, to the group of lenders who will soon cut their interest rates for VND for manufacturing businesses to 17 – 19 percent a year.

Some other banks, such as Agribank, VIB, and Techcombank, are building up their interest rate policies based on the conditions of their business operations to cut the lending interest rates for the manufacturing sector, rural agriculture, and exports following the aforementioned consensus.

Overseas VN workers to send home $1.8 bln

Vietnamese laborers working abroad are expected to send home some $1.8 billion by the year-end, said Overseas Labor Management Department under the Ministry of Labor, War Invalids and Social Affairs.

They sent back $1 billion worth of inward remittance to the country in the first six months of this year, said the department.

The agency forecasts there would be about $10 billion of overseas remittances to be transferred to the country by overseas laborers in 2011-2015.

Though the total amount of money sent home by Vietnamese workers are still small compared to that in some other countries which is even higher than the foreign direct investment (FDI) capital, international aids and higher than the export turnover of some key items, it has help significantly improve the poverty and promote investments, said the department’s spokesperson.

The country has sent over 60,530 Vietnamese laborers to other countries this year. Most of who are working in Taiwan, Korea and Malaysia with 23,673 workers, 14,134 workers and 6,664 workers respectively.

Korea's fund management firm opens rep office in HCMC

Korea Investment Management Co Ltd has been licensed by State Securities Commission (SSC) to establish a representative office in Ho Chi Minh City.

The office will locate at the 7th floor of Diamond Plaza at 34 Le Duan Street in HCMC’s District 1, according to certificate No 01/UBCK-GCN issued by chair of State Securities Commission (SSC).

The new representative office will be put into operation under the authorization of Korea Investment Management Co Ltd addressed at 27-1 Yeouido Yeongdeungpo-gu, Seoul 150-745, South Korea.

It will have operation period of five years, with main functions such as contacting and conducting market surveys, setting up cooperation projects in stock sectors in Vietnam, promoting and supervising the implementation process of signed contracts and agreements between foreign stock trading organizations and Vietnam's economic institutions.

Tourism company to seek investors for major projects

Saigontourist Holding Co. will invite investors to help develop  major tourism projects in HCMC and other provinces that will cost a total US$1.65 billion.

There are two smaller projects to construct four-star hotels, Saigontourane Hotel in the central city of Danang and Saigon-Phu Tho Hotel in the northern province of Phu Tho with a total capital of US$35 million and US$11 million respectively.

The remaining projects are larger. Saigon Sunbay will cover 600 hectares in HCMC’s Can Gio District and need up to US$1.4 billion.

Similarly, the Rach Chiec Residential Multi-Use Complex is set to be a 23-story building with 600 apartments, exhibition-trade centers and a golf course. The complex requires US$75 million.

Saigontourist also plans to deploy the Saigon South Amusement Park and Yacht Marina covering over 10 hectares in HCMC’s Nha Be District. With these projects, there will be a 15-storey skyscraper to be constructed with 300 hotel rooms and condos, 15 villas, yacht terminals and casino services with a total capital of US$64 million.

Meanwhile, the Saigon-Cam Ranh resort in Khanh Hoa Province covering 19.8 hectares will also be turned into 800 apartments, 40 villas, a yacht terminal along with other services, all of which will be worth US$69.7 million.

According to Saigontourist, these projects have all finished their site clearance phases. Most projects are expected to be completed in the 2014-2015 period, except for the massive Saigon Sunbay, which is set to be completed in 2018.

Currently, the company manages over 100 subsidiaries in the field of hotels, resorts, restaurants and logistics with a total revenue of over VND10 trillion.

Guangdong - Vietnam cooperation reviewed

Vice Governor of China’s Guangdong province Zhao Yufang visited Vietnam and attended a conference to review cooperation between Vietnamese ministries, agencies and localities and Guangdong province from Sept. 4-9.

At the conference, the second of its kind, the two sides agreed that together with the Vietnam-China comprehensive strategic cooperative partnership, the multi-faceted cooperation between Vietnam and Guangdong has seen positive developments, especially in the exchange of visits, economic, trade and investment cooperation, along with culture, education, agriculture and tourism.

In the economic field, Guangdong has led Chinese localities in trading with Vietnam, with a total turnover of over US$5.83 billion in 2010, up 31.9 percent against the previous year. The figure reached US$3.56 billion in the first six months of 2011, representing a year-on-year increase of 40 percent.

Guangdong businesses have invested in many projects in Vietnam, particularly the An Duong Industrial Park project in the northern port city of Hai Phong, with a registered investment of US$4 billion.

Many Vietnamese commodities have become familiar to Guangdong customers, especially consumer goods, agricultural products and food.

In 2010, about 100,000 Guangdong tourists visited Vietnam, soaring 40.6 percent, and more than 180,000 Vietnamese visitors chose Guangdong as their destination, up 31.7 percent.

During the conference, the two sides also agreed on several measures to boost the mutually beneficial cooperation and partnership between the two sides in all fields, especially the exchange of delegations, sharing of experience, and trade and investment promotion.

Besides Hanoi, the Guangdong delegation also visited Hai Phong city and Quang Ninh province.

Food, processing & packaging technology on show in HCM City

The International Exhibition on Food, Processing & Packaging Technology (Vietfood & Pro+Pack Vietnam 2011) opened in HCM City on September 8.

The event is co-organised by the Department of Commerce and Industry, the HCM City Food Association, Vinexad and the Vietnam Alcohol, Beer, Wine and Beverage Association.

More than 180 foreign and domestic enterprises are exhibiting their products at  256 pavilions, including processed food, beverages, services, restaurants and packaging.

The event aims to create favourable conditions for businesses to access the latest products and processing technologies in the world, contributing to comprehensive development for the food, processing, and packaging industries in Vietnam and providing a welcome boost in export activities.

Nguyen Nam Hai, Deputy Minister of the Ministry of Industry and Trade said that the event offered a good opportunity for investors to share experiences in their related fields, expand cooperation and sign contracts.

The event will also serve as a bridge to link both local and foreign enterprises, expand the market, boost exports and seek distribution agents, he said.

The Beer and Drink Festival Vietnam 2011 will also be held during the exhibition with the participation of many different trademarks.

PV