Prestigious taxi firms in Hanoi found cheating

Authorities in Hanoi have just announced that many prestigious taxi companies in the capital were also found with various violations.

These companies included Mai Linh, Au Lac and CP Hanoi, said the municipal Department of Transport.

According to the department, up to 85 taxi firms with 267 vehicles have been found cheating.

In several cases, drivers put a chip into the meter forcing costumers to pay higher fees.

Department inspectors have made a list of 14 violating firms and submitted it to the department so that it could review the possibility of revoking their operating licenses.

Hoang Van Manh, Deputy Chief Inspector at the department, said, “In order to prevent possible cheating, costumers should pay proper attention to the meter, the driver’s card, vehicle number and taxi brands. Anything that seems abnormal should be reported to one of the municipal traffic inspectorate’s two hotlines at 04.38217922 and 0913587191.”

He added that the inspectorate would increase punishments for violators. Inspection would be conducted at firms with repeated violations. If they make no improvements they would have their licenses revoked.

Low occupancy rates drive away hotel investment

Many hotels in Vietnam have been put up for sale, one of the signs that there are fewer investors interested in this sector in Vietnam.

Among those on or going on the market in Vietnam is the Metropole Hanoi. VinaCapital Vietnam has hired Jones Lang LaSalle Company to sell 50% of their stake in the hotel at USD58.7 million.

In addition, several hotels are in need upgrades and are seeking foreign and domestic investors to achieve this goal. Lotte has bought the five star hotel Legend Saigon in HCM City.

According to CBRE, in the first six months of this year, hotels in Hanoi welcomed 929,000 foreign guests, up to 21.5% on-year. However, local three-to-five star hotels’ occupancy rates only reached an average of 57%. Room rental was at around USD73 per night, down 3.5% from the quarter before and 5.1% from last year.  This has resulted in an on-year drop of 4.6% in Revenue Per Available Room (RevPar) to USD41.

The situation is forecast to worsen as the hotel room supply would reaches nearly 10,000 rooms by the end of the year, up 13.5% compared to the same time of last year. Two big hotel projects, namely Intercontinental Hanoi Landmark (359 rooms) and JW Marriot (450 rooms) are expected to be launched.

Richard Leech, Managing Director of CBRE, said the investment withdrawal can be mostly attributed to the decrease in hotel occupancy rental rates.

Meanwhile, the Vietnamese tourism sector is less competitive than that of many regional nations. A four-day and three night tour to Cambodia is roughly USD200 per person, but return airfare from on the Hanoi-HCM City route can cost up to USD300.

$100m spent on highway upkeep

Over VND2.137 trillion (US$100.5 million) from the Road Maintenance Fund has been used to maintain the nation's highways over the first six months of this year.

Transport Minister cum chairman of the Central Road Maintenance Fund Management Council Dinh La Thang, said that the fees were collected in a transparent manner, with vehicle owners and drivers responding quite positively in general.

The fund helped to ensure that road maintenance work on the highways were carried out on schedule, he said, adding that if spending is targeted, the fund could improve the quality of many roads and restore public confidence in the policy.

Since January this year, more than 35 million motorbikes and 1.5 million cars, lorries and buses nationwide have been required to pay a road maintenance fee. Annual fees are VND50,000-150,000 ($2.3-7.1) for motorbikes, with 11 different rates for other vehicles. These range from VND1.5 million ($71) for cars with less than 10 seats to VND12.5 million ($600) for lorries and commercial vehicles over 27 tonnes.

A central management council has also been set up to ensure that the new local councils use the road maintenance fund effectively.

According to the central council, in the first half of this year, the Register's Agency collected road maintenance fees to the value of VND2.714 trillion ($127.7 million ) from cars, coaches and trucks. The Finance Ministry has also allocated VND375 million ($17,650) to the fund.

The funds will be distributed across the councils, with 65 per cent going to central level and 35 per cent to local level, with local transport departments proposing needed road maintenance projects. Moreover, localities are now empowered to charge motorbikes and are being encouraged to start collecting the fees.

However, until now, just 37 out of 63 cities and provinces nationwide have established local fund management councils and 15 localities are responsible for motorbikes. Only ten localities have opened a bank account to receive funds from the central management council.

Minister Thang also urged the Viet Nam Roads Administration to finish putting together their road management software programme as soon as possible, which will help to distribute the funding effectively.

At present, Viet Nam has over 256,600 km of roads, including 17,200km of national highways and 23,530km of provincial highways. Previously the Government could only afford to maintain up to 1,000km of national highways and 10,000km of bridges and urban roads yearly.

Vietcombank, Agribank slash deposit rates

Vietcombank and Agribank have further slashed their deposit interest rate for one-month terms to 5 per cent per year, while the common interest rate continues to range between 6.5-7 per cent at other banks.

Two-month and nine-month terms on deposit interest rates offered by Vietcombank ranged between 6.5 to 7 per cent per year, the ceiling for less than six-month terms is still at 7 per cent per year.

Agribank's one-month term deposit interest rate was also reduced to 5 per cent per year yesterday, and the highest interest rate on one-year term deposits was kept at 8 per cent.

The interest rate at other banks such as Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), the Bank for Investment and Development of Vietnam (BIDV) and other joint stock banks remained unchanged yesterday.

Furniture sector hit by price hikes

Local producers of wooden furniture are struggling due to an increase in the price of imported wood that has negatively affected their operations.

According to the HCM City Wood Processing Association (HAWA), the cost of timber imported from the US, Europe and Africa rose by 20 per cent in the last five months.

"Normally, import prices fluctuate from 5-7 per cent, but 20 per cent is a big hit and is eating into producers' profits," said HAWA's vice president Huynh Van Hanh.

Hanh said producers had already fixed sale prices for the next 3-6 months, so the sudden hike in input materials was causing big losses.

Hanh attributed the rise in import prices to the ongoing recovery of the US construction industry which had increased demand there, and the narrowing supply from Africa.

Nguyen Chien Thang, director of Scansia Pacific, a prominent furniture producer and exporter based in HCM City, said his company was faced with big challenges.

"The demand for high grade wooden furniture is rising, especially from Japan. This price hike is hurting our business," Thang added.

Vo Truong Thanh, chairman of the Truong Thanh Wood Group, said the price of local timber remained stable, so his company would use it as a substitute.

"However, we have to talk to our clients about changing the material," he added.

According to the General Department of Customs, the export volume of wooden furniture in the first six months of the year reached US$2.23 billion, up 11 per cent year-on year, while the import volume of wood fell 5 per cent to $617 million.

HCM City wholesale, retail buildings on rise

HCM City's retail networks, especially modern facilities like shopping malls and supermarkets, have developed rapidly in recent years, according to the local Department of Industry and Trade.

In the first half of this year the department issued licences for six supermarkets and one mall.

Together with the Department of Finance, it also offered on lease 59 lots of public lands for building supermarkets, convenience stores, and price-stabilisation shops.

The city has three wholesale markets, 234 traditional markets, 30 shopping malls, and hundreds of supermarket outlets and convenience stores besides thousands of mom-and-pop stores.

The city was one of the first in the country to set up agricultural wholesale markets and operate them effectively, according to the department.

Under a road map for developing wholesale and retail distribution systems it approved in 2009, the city offers many incentives to attract investors, like rent and tax breaks.

It includes encouraging the setting up of supermarkets and convenience stores in outlying areas, industrial parks, and export processing zones, and creating modern retail facilities near the parks and zones to replace the impromptu markets that spring up there now.

Le Ngoc Dao, deputy director of the department, said the plan is progressing well.

As of the end of June there were 7,317 price-stabilisation shops, the city People's Committee said. There were supermarkets and retail shops in all 24 districts.

Domestically made products account for 90-95 per cent of those sold in supermarkets.

Besides, in the last year city-based retailers opened 35 supermarkets, shopping malls, and convenience stores in 20 southern provinces at a cost of VND750 billion (US$35 million).

Commercial bank loans help firms in City District 11

Six commercial banks on Tuesday signed loan agreements worth more than VND255 billion (US$12.14 million) with 17 enterprises and four households in District 11.

Joining the lending spree was Sacombank with VND50 billion ($2.38 million) lent to 11 businesses and one household at annual interest rates of 9 per cent and up.

The other five banks that signed the low-interest loan agreements are Vietinbank, BIDV, DongA Bank, Eximbank, and LienVietPostBank.

Dao Nguyen Vu, deputy general director of Sacombank, said the banks were determined to support businesses in accessing capital so that they could reduce inventories and increase production and trading in challenging times.

This would help the businesses continue to develop in the coming years, he said.

Since the beginning of this year, Sacombank has implemented 15 preferential credit packages worth VND1.7 trillion ($80.95 million) and $105 million to support businesses and individuals following policies issued by the Government and the State Bank of Viet Nam, he said.

Besides, to support businesses who join the city's price stabilisation programme for 2013 and the Lunar New Year 2014, Sacombank will set aside VND200 billion ($9.5 million) to be lent at preferential interest rates of 6 per cent and up per year, Vu said.

Tuesday's signing ceremony was chaired by the HCM City branch of the central bank, the city's Department of Industry and Trade and the District 11 People's Committee.

Profitable firms to pay cash dividends

Eleven companies have announced their cash dividend payouts this month, a move to boost investor psychology given the current downturn on the stock market.

The firms, which have all announced profits, include the Global Electrical Technology Corporation (GLT). The firm is a top payer with a cash rate of up to 50 per cent, paid on July 31 in the second phase of the company's dividend payout for the year 2012 of a total 65 per cent. Last year, GTL paid 15 per cent.

Nghe An Bus Station Co (NBS) and Development Investment Construction Hoi An Corp (DIH) followed with a rate of 30 per cent and 25 per cent, respectively. Payouts will be made in August.

Three companies decided to a pay cash rate of 15-17 per cent, including Thac Ba Hydro-power Co (TBC), Thac Mo Hydro-power Co (TMP) and Southern Industry Corp (CSM), of which CSM will pay another 15 per cent in the form of stocks.

Others will pay from 5 per cent to 10 per cent, including Viet Thang Feed (VTF), Sieu Thanh Corp (ST8), Bien Hoa Packaging (SVI), Mekong Fisheries (AAM) and SMC Investment Trading Co (SMC).

Payouts will be made from this month to September.

All dividend payers are profitable, of which the two hydro-power companies Thac Bac (TBC) and Thac Mo (TMP) were the biggest gainers with each reporting a net profit of over VND146 billion (US$7 million) and VND128 billion ($6 million) last year, respectively.

Da Nang grants investment licence

The Hi-Tech Park management board in central Da Nang City has granted an investment licence for Niwa Foundry company from Japan with a total capital of US$21.87 million.

The project covers 2ha and will manufacture casting parts for hydraulic components and high precision machining technologies.

It will begin production next year with 2.4 million products per year.

Last year, Tokyo Keiki Inc invested in a $40 million project to produce electro-magnetic and hydraulic equipment in the park.

The city currently has 60 investment projects from Japan, worth $320 million.

Sugar producers face hard times

Domestic sugar producers are facing low prices, high stockpiles, and illegal imports from China, said the Viet Nam Sugarcane and Sugar Association (VSSA).

At a conference to review the first six moths of the year in Ha Noi on Wednesday, Doan Xuan Hoa, deputy head of the Department of Processing and Trading Agricultural Forestry and Aquatic Products, said the country's sugarcane covered 298,000 hectares.

Hoa said producers still bought sugarcane at the high price of VND1 million per tonne although selling prices were VND2,000-3,000 per kilo lower than last year.

"This was the highest buying price in the area. If producers did not buy at the price, farmers would not plant sugarcane and the factories would face shortages," he said.

He said the sugar industry had established concentrated production areas and had close links to farmers.

Producers tried to buy sugarcane at high prices despite decreasing sugar consumption to help farmers retain their planting areas.

However, the sector faced a paradox. Farmers' incomes were still low despite high prices.

In addition, local sugar prices were much higher than other countries in the region.

Nguyen Thanh Long, VSSA's chairman said the reason was that Viet Nam's businesses had high production costs.

Long said high buying prices and imported chemicals used in sugar production contributed to the higher prices.

He added that the sector had struggled to stop illegal imports of sugar from China.

"While locally made sugar is being illegitimately exported, a large volume of foreign sugar is being illegally imported into Viet Nam, putting increasing pressure on local producers," he said.

Do Thanh Lam, deputy head of the Ministry of Industry and Trade's Market Management Department, said figures showed that authorities had seized 1.3 million tonnes of sugar since 2010.

In the first half of the year, the department seized 362 tonnes of sugar in southern An Giang Province.

Meanwhile, the volume of unsold sugar at local plants totalled about 490,000 tonnes in June, lower than the peak level of about 579,800 tonnes in May but still high compared to the same period in 2012.

The association forecast the total yield of the sugar crop for 2012-13 would be a record of more than 1.5 million tonnes while local demand is put at 1.3-1.4 million tonnes this year.

Improved import, export figures boost State budget

State budget revenues in the customs sector in the first half of 2013 fell short of the year's plan but results were encouraging in the context of a struggling economy, the General Department of Customs has said.

The six-month total revenue was estimated at VND96 trillion (US$4.57 billion), accounting for only about 40 per cent of the year's target.

But with improved import-export values, a rise in petroleum tariffs and some rallying major firms boosting foreign trade activities, the revenue figure showed an increase of 5.5 per cent compared to the same period last year. Customs departments in many provinces, including Dong Thap, Khanh Hoa, Hai Phong and Can Tho, posted remarkable year-on-year rises in State budget revenues.

As of June 15, budget revenues in Dong Thap reached VND231.6 billion ($11.03 million) – up 89.94 per cent; Khanh Hoa VND1.74 trillion ($83 million) – up 63.03 per cent; Hai Phong VND14.63 trillion ($697 million) – up 14.83 per cent; Can Tho VND261.59 trillion ($12.46 million) – up 4.81 per cent.

These positive figures come after a resurgence in the last few months, with greater authority efforts to facilitate importers and exporters, the general department said.

In a difficult January-April period, the department collected VND56.29 trillion ($2.68 billion), accounting for 23.7 per cent of the plan, down 5.25 per cent year-on-year.

The figure rose to VND74.5 trillion ($3.55 billion) in the January-May period, accounting for 31.4 per cent of the plan, down 1.4 per cent year-on-year.

For the remainder of the year, the general department said it would continue to help import-export businesses solve difficulties, expand the application of electronic customs procedures and carry out appropriate measures to prevent tax revenue losses.

In the first half of this year, the total import-export value was estimated at $125.51 billion, up 16.8 per cent year-on-year.

Leather and shoe products on show in HCM City

As many as 160 international and domestic manufacturers, representing 16 countries and territories from around the globe, have attended the opening of the 15th International Shoes and Leather Exhibition in Ho Chi Minh City on July 11.

The three-day event is co-organised by the Vietnam Leather and Footwear Association (LEFASO Vietnam), Top Repute Co. Ltd, and the Association of Garments, Textiles, Embroidery, and Knitwear (AGTEK).

The exhibition showcases the latest material technology and leather products from Argentina, China, Germany, India, Japan, Spain, Thailand, Turkey, and the US.

Vietnamese manufacturers and enterprises can use the event to learn from international experiences, promote their products, and forge new business partnerships.

The exhibition’s framework also encompasses a number of other activities conducive to the Vietnamese footwear industry’s development.

The 2014 International Footwear Design Competition will be officially launched as well as seminars held on the opportunities and challenges facing the domestic leather sector with the imminent Trans-Pacific Strategic Economic Partnership Agreement and the European Union free trade agreement.

Switzerland helps SMEs improve export competitiveness

Can Tho City on July 11 launched a Swiss-funded programme designed to improve the export competitiveness of small and medium-sized Vietnamese enterprises (SMEs) through a local trade promotion system over the 2013–2016 period.

The US$3.9 million programme, sponsored by the Swiss Government, will be implemented by the Trade Promotion Department.

It hopes to raise export turnover and develop key Vietnamese export industries via a nationwide trade promotion scheme.

It will also build upon the Government’s current policies striving to expand the domestic consumer market, help businesses liquidate excess stock, and encourage a thriving business environment.

Trade Promotion Department Deputy Head Do Kim Lang said the program will focus on bolstering capacity for local trade promotion centres and other trade promotion organisations, establishing the National Export Council, and consolidating the Trade Promotion Department’s own initiatives.

Market prices under scrutiny

The Finance Ministry’s National Institute for Finance and Economics has hosted a July 11 seminar reviewing Vietnamese market prices during the first half of 2013 and discussing their implications for previous whole year forecasts.

Economic experts warn the global economy will continue to suffer difficulties and electricity, petroleum, oil, and fertiliser prices are all likely to rise.

The consumer price index (CPI) edged up only 2.4 percent from December 2012 to June this year. This result, the lowest increase in ten years, is mainly due to the uniform measures the Government mandated in Resolution No. 1 and international fuel and food price fluctuations that forced import-export costs down.

Seminar participants said that low CPI in the first six months of 2013 is a positive sign for consumers and shows dramatic advances in the Government’s efforts to improve macro-economic management and keep inflation in check.

They noted, however, that risks including disappointing purchasing power and slow credit growth will put additional pressure on production already struggling with high bad debt ratios, inefficiency, and sluggish economic restructuring.

Nguyen Tien Thoa, head of the Finance Ministry’s Price Management Department, said minimising budgetary spending and keeping inflation at 4.8 percent are the two most important priorities for the time being.

Deputy PM focuses on human resources for Vung Ang economic zone

Deputy Prime Minister Nguyen Thien Nhan on July 11 chaired an online working session with central Ha Tinh province to review the results of human resources training for Vung Ang economic zone.

The 22,000 ha Vung Ang area was established in 2006 as one of five key coastal economic zones in the country.

As many as 226 enterprises have been granted business and investment licences in the zone, including 26 operating projects and 28 others in the progress of construction.

At present, nearly 12,500 labourers work in the area, while labour demand in the zone is forecast to reach 67,000 in 2015.

Training workers for Vung Ang economic zone has received the support of the Government, ministries, the provincial authorities, businesses and training centres.

The Ministry of Education and Training has coordinated with Ha Tinh authorities in enrolling and training students who will work in the economic zone in the future.

In addition, the province has issued special job-training policies to attract a high quality workforce for the zone during 2011-2015 period and established an investment and manpower promotion centre.

More than VND585 billion (US$27.54 million) from the State budget was allocated to schools in the province from 2009 to 2013. Additionally, VND164 billion (US$7.72 million) from the provincial budget was invested during the 2010-2012 period.

However, training assignments in 2012 were not as successful as expected due to the lack of school coordination mechanisms for labour training, weak communication with local students, and low investment in key training centres.

Concluding the working session, Deputy Prime Minister Nhan stressed that Ha Tinh province should cooperate with businesses to review labour demand and supply information every three months for training units to build their plans.

It also needs to coordinate with the Ministry of Education and Training, schools and businesses to help workers at foreign-invested companies learn foreign languages, he said.

Additionally, the province should promote its communication with students in Ha Tinh to work in the economic zone after they graduate, Deputy Prime Minister Nhan added.

Boosting exports to Laos

Vietnam considers its neighbouring countries as potentially lucrative export markets. After securing a firm foothold in Cambodia, domestic businesses are gearing up to promote trade and investment in Laos.

According to Vietnam Customs statistics, exports to Laos in the first five months of the year hit US$205.3 million. Main commodities included fruits and vegetables, coal, petroleum, paper, garments and textiles, iron and steel, machinery and equipment, spare parts, electric cables, transportation vehicles, and components. Imports from Laos were estimated at US$228.4 million including corn, wood products, and metals.

State management agencies confirm that trade turnover between Vietnam and Laos has increased remarkably in recent years, by 38.13 percent to US$274.10 million in 2011, compared to the previous year’s level. Last year, Vietnam earned US$421 million, a 53.3 percent year-on-year increase in export earnings from Laos.

Pho Nam Phuong, Director of the HCM City’s Investment and Trade Promotion Centre (ITPC) said that bilateral trade turnover in the first half of 2013 already reached US$520 million, up 11.6 percent compared to the same period last year.

One advantage for Vietnamese exporters to exploit is that there is a large Vietnamese community in Laos, not to mention this country has to import most of consumer goods from other nations.

The Vietnam trade office in Vientiane said Vietnamese goods currently make up just 16.4 percent of Laos’ total import volume. But some Vietnamese brands and products have proved a hit with Lao customers.

A batch of cars including Mazda 2, Mazda 3, and CX-5 models assembled at a factory in Quang Nam province’s Chu Lai Open Economic Zone will be exported to Laos on July 14 under the terms of an automobile cooperation contract signed between Vina Mazda and Japan Mazda Motors on June 27.

The ITPC has closely coordinated with the Lao People’s Republic’s Consulate General in HCM City to hold a seminar on Laos’ market trend and the city’s trade, investment, and tourism promotion program.

Lao Consulate General Southideth Phommalat said that apart from its hydroelectricity potential, Laos is rich in mineral resources like gold, coal, and iron. In the current process of regional and international economic integration, Laos is set to promote its diplomatic contacts with a view to attracting foreign investment and expanding import-export and tourism activities.

Laos has already introduced its incentive policies for investors in agriculture, forestry, and processing industries, and tourism, he said.

Mr Phommalat recommended Vietnamese businesses deepen their understanding of Laos’ legal system, policies, and administrative procedures, including taxation and labour management. As a reward for such efforts, more opportunities will be opened for them to expand production and business operations.

HCM City will host an investment, trade, and tourism exhibition scheduled for July 22–26 and conduct a Laos market survey from July 22–25. HCM City plans on tailoring the promotion program to businesses operating in garments and textiles, cosmetics, household utensils, food and foodstuffs, electronics, and construction materials.

Lao Government statistics show that since late 2012, Vietnamese businesses have invested in 224 valid projects in 16 out of Laos’ 17 provinces with a total capitalisation exceeding US$4.2 billion.

Two-way trade turnover between Vietnam and Laos is expected to reach US$2 billion by 2015.

Switzerland helps SMEs improve export competitiveness

Can Tho City on July 11 launched a Swiss-funded programme designed to improve the export competitiveness of small and medium-sized Vietnamese enterprises (SMEs) through a local trade promotion system over the 2013–2016 period.

The US$3.9 million programme, sponsored by the Swiss Government, will be implemented by the Trade Promotion Department.

It hopes to raise export turnover and develop key Vietnamese export industries via a nationwide trade promotion scheme.

It will also build upon the Government’s current policies striving to expand the domestic consumer market, help businesses liquidate excess stock, and encourage a thriving business environment.

Trade Promotion Department Deputy Head Do Kim Lang said the program will focus on bolstering capacity for local trade promotion centres and other trade promotion organisations, establishing the National Export Council, and consolidating the Trade Promotion Department’s own initiatives.

Swiss-Belhotel International opens 4 - star hotel in Lao Cai

The first international 4-star Swiss-Belhotel Lao Cai, under the management of Swiss-Belhotel International, was officially inaugurated on July 15.

The hotel was invested by Vietnam Biti’s-a leading footwear production and trading company with a total capitalization of VND 500 billion.

Swiss-Belhotel Lao Cai has 186 modern guestrooms and an array of sophisticated facilities including conference rooms, business centre, fitness centre and lobby lounge and bar and upmarket restaurants.

Attached to the newly built commercial centre, Swiss-Belhotel Lao Cai is very convenient for those interested in dining, entertainment and shopping.

According to Vuu Khai Thanh, General Director of Biti’s, the hotel operation is part of a strategic plan to develop the Kunming - Hanoi- Haiphong Economic Corridor connecting Asean countries by Asian Highway.

Swiss-Belhotel International currently manages a portfolio of more than 120 hotels, resorts and projects located in China, Vietnam, Philippines, Malaysia, Indonesia, Australia, Kuwait, Qatar, Bahrain, Iraq, Oman and Saudi Arabia.

Awarded Indonesia's Leading Global Hotel Chain for three consecutive years and Most Favourite 4-Star Hotel, Swiss-Belhotel International is one of the world’s fastest-growing international hotel and hospitality management groups.

Restructuring agriculture: Where to start

Transformation of the structure of agricultural products has been taking place slowly in Viet Nam over the past years, leaving big challenges for restructuring the sector.

Agriculture expanded 4.5% between 1995 and 2000 and 3.8% in the period of 2000-2005. The figure only fell 0.4% to 3.4% in the following five years and reached 2.7% last year.

Compared to other neighboring countries, prices of farm produce, particularly food, are relatively low, which helps magnet foreign investment.

Viet Nam has emerged to become a top exporter of rice, rubber, coffee, pepper, cashew kernels, aquaculture and timber products. In 2012 alone, export value of farm produce hit a record high of US$27.5 billion. Agriculture was the only sector earning net trade surplus in the context of slow economic growth.

However, agricultural structure is problematic with crop plantation accounting for over 50% of agricultural products, especially rice takes the biggest share.

Despite low efficiency of rice, the country has still maintained a large land area for rice cultivation to ensure food security, so peasants are not keen on rice production and extensive cultivation.

Meanwhile, livestock husbandry has been developing quickly yet unsustainably. Low productivity, high costs, dependence on foreign animal feeds supply, weak disease control capacity are among main features.

Fisheries field also encounters challenges, including unstable feeds supply, limited disease control capacity, and weak trademarks.

Besides, forestry’s share of economic outputs remains modest in comparison to its potentials.

In the early days of the renewal process, changes of economic institutions ushered in booming developments in agriculture. Since 1995, the sector’s growth has mainly been driven by exploitation of natural resources but technological and institutional renovation has been slack.

The quality of growth can be viewed from the perspectives of post-crop losses, product quality, food hygiene and safety, and added value.

These above challenges should be addressed through restructuring the sector towards higher value and sustainable development, according to Dr. Nguyen Do Anh Tuan from the Institute of Policy and Strategy for Agriculture and Rural Development.

Mr. Tuan said the first solution should be a shift from low-quality products and low market potential to high-quality products and high market potential.

He emphasized the need to make planning schemes and supervise the implementation of the schemes for key exports like coffee, rubber, tea, pepper and cashew.

Inefficient rice lands should be converted to other uses, giving room for such fields like husbandry, fruits and vegetables, aquaculture among others.

The State should protect agricultural land while allowing flexible land-use changes and maintaining proper land area for special-use and preventive forests.

Special incentives are needed to lure private investments into industries which support agricultural production and processing. Meanwhile, public investments should be steered to technological development in favor of post-crop stages, market analysis and forecast.

Public-private partnership should be encouraged to develop commercial infrastructure for trading activities.

The State will focus on advocating research and development activities and technology transfer; creating favorable conditions for market and production development; and providing information and services to help relevant stakeholders manage risks better.

It also needs to restructure State-owned enterprises, agricultural and forestry farms and offer incentives for peasants and enterprises to renovate production.

Purchasing power expected to increase

$0 Economic experts at a July 11 seminar on Vietnam’s market prices have predicted that the country’s purchasing power is likely to increase in the remaining months of the year.

Nguyen Ngoc Tuyen, Director of the Institute of Finance and Economics, cited some reasons that will lead to a CPI rise, including the high demand period from September, measures to loosen financial and monetary policies, and growing consumer spending on education.

According to experts, economic and banking system restructuring, adjusted interest rates, measures to encourage social investment and favourable tax policies all will push up supply and purchasing power.

Statistics from the Ministry of Planning and Investment show that the country’s total purchasing power in the first six months of 2013 was down due to weak demand.

Total retail sales and services revenue in the period was estimated at 1,275 trillion VND, a year-on-year increase of 11.9 percent. The growth rate for 2012 was 16 percent.-V

Masan borrows US$175 million from JP Morgan

JP Morgan and associate companies have provided Masan Industrial, a unit of Masan Consumer, with a US$175 million loan, according to Masan Group.

The loan comes with a three-year term and is used to pay the existing loan of US$108 million and invest in the consumer goods field of Masan Group. The interest rate is not revealed but lower than that for the US$108-million loan.

US$150 million of the fresh loan is guaranteed by the Multilateral Investment Guarantee Agency (MIGA), which is a member of the World Bank Group and specializes in promoting investments to help support development targets.

Masan is the first private business in Vietnam and Southeast Asia to receive support from MIGA with a financial business loan. Moreover, the loan provided for Masan is the biggest MIGA has ever provided for a private firm globally.

Masan Consumer, a leading consumer goods producer in Vietnam, produces and distributes foods and drinks, such as fish sauce, soy sauce, chili sauce, instant noodle, instant coffee and instant cereal.

Masan Consumer earned nearly VND10.4 trillion in revenue and VND2.82 trillion in profit last year, up 62% and 115% respectively. Thanks to its impressive performance in the past time, Masan has attracted many foreign investments.

Early this month, Masan announced TPG Growth, the global growth equity platform of the private investment firm Texas Pacific Group (TPG), spent US$50 million buying a 49% stake in Masan Agriculture, another unit of Masan Consumer. Before that, KKR invested an additional US$200 million in Masan Consumer after pouring US$159 million into the local firm in 2011.

Meanwhile, Masan Consumer has struck some deals to buy other firms such as the animal feed producer Proconco, Vinacafe Bien Hoa Co., Vinh Hao Mineral Water Co. and Phu Yen Beer and Beverage Co.

LLD opens fourth decorative lighting showroom

Long Life Development Co. (LLD), the official distributor of Philips decorative lighting in the country’s south, opened a large-scale showroom in HCMC on Monday, taking to four the total number within one month.

With a total area of more than 130 square meters at 18A Nguyen Van Troi Street in Phu Nhuan District, the showroom is one of the four Philips decorative lighting centers to be opened by LLD and its sale agents within one month. The three others are The He Xanh showroom at 73 Dinh Bo Linh Street in Binh Thanh District, Nam Minh Long showroom at 61-63A Vo Van Tan Street in District 3 and Le Vo showroom at 158 Le Hong Phong Street in Vung Tau.

These facilities are designed in line with a high-class and modern model meeting new criteria and style of the Philips global showroom system, LLD said. Besides showcasing products, the showrooms provide spaces for customers to experience lighting technology applications. These centers are also where experts and consumers can refer to new global design trends and decorative lighting technologies.

The showrooms feature middle- and high-level decorative light brands of Philips such as Ledino, EcoMoods, LivingColors, Aquafit, Kidsplace, Roomstylers or Linea along with many other multifunctional items.

LLD has developed eight decorative lighting showrooms in southern cities after it became the official distributor of Philips Electronics Vietnam Co. Ltd. in August 2012.

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