Traders overstock foods due to typhoon Haiyan

Many trades in Hanoi built up large inventories of vegetables for fear of the food scarcity because of typhoon Haiyan, and are now sitting on large amounts of product that is difficult to move.

By late November 11, the vegetable stall of Mrs Hoa in Thanh Xuan District was still full of different kinds of varieties of products. Still, that day the amount she sold was lower than normal for an average day.

She said, “I thought when I saw many people trying to stock up on food in case of the effects of the storm that I would have enough to provide their needs. Now I have a big inventory that may go rotten."

According to Hoa, after storms, vegetable prices usually increase due to heavy rains. However, the typhoon Haiyan only directly affected the northern province of Quang Ninh, which is more than 100km far from Hanoi, Hanoi was not seriously effected. Most of vegetables in Hanoi come from some northern localities, including Hai Duong and Hung Yen.

At Trieu Khuc Market, traders also faced the slow sales of vegetables. One seller said many people had already bought food for storage and did not need to stock up.

Traders said their business situation would become better after some days to come when people will have used up their stored food.

Nguyen Thi Nga, from Dong Da District, Hanoi, said, "I'm happy that the storm has passed, but the family would still needs food until the end of this week.”

Mrs. Nguyen Thi Ly at Nam Dong residential area said her family’s refrigerator is full of various kinds of foods. This food can be enough for her family to last until next week.

Some days ago after hearing about the typhoon, many people in Hanoi rushed to markets and supermarkets to buy food for storage. Many local supermarkets were still crowded at closing time.

HCM City impatient with resettlement housing projects

Investors of resettlement apartment projects in Thu Thiem new urban area may face stricter sanctions in the future as the HCMC government has urged implementation acceleration of such projects.

The implementation process of resettlement projects is slow and only 1,132 completed resettlement apartments have been transferred to residents in the new urban area. There are still up to 1,993 apartments falling behind schedule by over four months.

Investors of these apartments are Nam Rach Chiec Co. with 712 units, Duc Khai Corp. with 1,080 units and the Vietracimex-POSA.C joint venture with 201 units.

Such low implementation, according to the city government, is unacceptable as it wastes money and lengthens the temporary residence of the people.

The Department of Construction is required to deal with slow implementation of investors based on signed contracts. The apartment transfer deadline has also been extended to June 30, 2014.

Those able to follow the schedule are allowed to keep working on their projects, while those who are incapable have to return the projects to the city.

Expert: Home loan rate of 3% impossible

Although the HCMC Department of Construction has suggested that lending rates from the VND30-trillion loan package should be slashed from 6% to 3% to support homebuyers, an expert from the central bank said that the lending rate could never be that low.

Nguyen Viet Manh, head of Credit Department under the central bank, told the Daily that the current rate of 6% per annum is reasonable as it is far lower than lending rates of commercial banks. The Government can consider revising the lending rate at year-end but still relies on interest rates on the market. Therefore, the lending rate of the VND30-trillion package may not drop strongly.

In addition, the lending rate is not the culprit of slow disbursement of the package. Currently, lending activities are facing problems due to low budget home supply. Meanwhile, many investors have yet to convert commercial projects into low-cost home projects while verification of residence reality remains slow, Manh said.

Besides, verification of income for debt payment is also a time-consuming step, making disbursement slower. Like other commercial credits, banks must consider home loan applications carefully to prevent further bad debts.

When the program kicked off, many people were concerned that banks would focus on giving credits to enterprises while ignoring homebuyers. However, banks up to now have disbursed just over VND80 billion for enterprises while they have given over VND200 billion to individuals, Manh added.

Le Hoang Chau, chairman of the HCMC Real Estate Association (HoREA), said that homebuyers will benefit from lower lending rates but in fact, there are no foundations for the lending rate to drop to 3%.

In March, HoREA suggested banks joining the home loan program to reduce management fees of 1.5% to share the burden of enterprises and homebuyers. If banks cut the fees from 1.5% to 0.5%, credits from the loan package will bear a lending rate of 5% per annum.

At the suggestion, Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch, said that it is difficult for banks to reduce the management fee as it supports lenders in extending the loan package to borrowers and compensates for risks. Therefore, the proposal may not be met.

The central bank has sent a document to five banks appointed to join the loan program to ask them to speed up disbursement. Up to now, only 1% of VND30-trillion worth of credits has been disbursed to borrowers.

POS transactions increase

Statistics of the Payment Department under the central bank showed that transactions via points of sale (POS) increased steadily in the January-September period.

In the third quarter, transaction value via POS surged by 21.9% against the previous quarter while the second quarter had already posted up a 14% increase. Meanwhile, transaction value via automated teller machines (ATMs) reported a low growth rate at 3.7% in the third quarter and even declined by 1% in the second quarter.

The average transaction value also increased during the period, standing at VND4.79 million each transaction in the first quarter, VND5.24 million in the second quarter and VND5.85 million in the third quarter.

However, total transaction value via POS in the third quarter was over VND36 trillion in the third quarter, which is much lower than the VND246 trillion via ATMs.

As of the end of the third quarter, over 57.2 million domestic payment cards were issued nationwide versus 5.7 million international credit and debit cards and the nation had in total over 14,500 ATMs and 119,000 POS.

To develop a non-cash payment economy, the central bank is studying measures to encourage payments via POS. The nation expects to have 250,000 POS by the end of 2015.

EuroCham: customs reforms needed to back auto industry

Vietnam’s automotive industry has fallen behind regional countries and will have to compete with imported vehicles in the future when many tariffs are cut to 0%, and reforms including customs ones should be enacted to support the industry, said the European Chamber of Commerce in Vietnam (EuroCham).

EuroCham on Monday released the White Book 2014 which was conducted with 800 European enterprises and included issues concerning trade/investment and recommendations.

According to the White Book 2014, Vietnam started to assemble vehicles twenty years ago and has imported vehicles on a large scale since 2003. After Vietnam joined the World Trade Organization (WTO) in 2007, official importers started to be present in Vietnam.

The automotive market achieved considerable growth in the past five years despite high taxes but saw a decline last year. This resulted from potential customers cutting spending due to tightened credit and high fees.

The inventories of both assemblers and dealers are not stable. To facilitate the industry, the authorities have lowered the registration fee to 10-15% for new cars (depending on each province and city) and 2% for cars with second registration.

Besides, the report indicates that the Vietnamese assembling automotive industry is likely to achieve a growth rate of only 3% per year due to the formation of the ASEAN Economic Community (AEC) in 2015 which will make local assemblers import vehicles from ASEAN as well as countries like Japan, South Korea and China.

The import tariff imposed on completely built up vehicles from ASEAN countries will be cut to 50% as from next year, 35% from 2015, 20% from 2016 and 10% from 2017 and zero percent in 2018. This will make imported vehicles more competitive compared to locally assembled ones.

According to Michael Behrens, a member of the EU automotive business group, the first thing to boost the Vietnamese automotive industry is reform customs procedures.

Although EuroCham recommended reducing procedures in the White Book 2013, Vietnam required importers to provide a copy of the car import contract in mid-2013.

According to members of EuroCham, unnecessary additional costs should be avoided as they increase the retail prices of cars in Vietnam.

Capital punishment suggested against corrupt exec

Prosecutors on Monday suggested the death penalty against Vu Quoc Hao, former CEO of the State-run Agribank Finance Leasing Company 2 (ALC II), for corruption and intentional violation of the law, causing losses totaling VND530 billion.

The prosecutor representing the HCMC People’s Procuracy at the fifth day of the first-instance hearing proposed harsh sentences against Hao for different counts, including capital punishment

for embezzlement of State assets, 20-year imprisonment for intentional violations of the law causing grave consequences, and 15 years behind the bars for abuse of power when performing public duties.

According to the verdict, Hao and his accomplices between April 2008 and March 2009 signed ten finance leasing contracts to give loans of over VND795 billion to four companies, although ALC II as a subsidiary under the State-run Agribank is not permitted to make loans.

Hao and other culprits in signing such agreements embezzled some VND140 billion, but their violations caused losses of over VND530 billion to the State.

In this court case, the prosecutor also proposed the death penalty against Dang Van Hai, former chair of the board of representatives of Quang Vinh Construction Co. Ltd., for similar offenses to Hao’s.

The prosecutor also proposed jail terms of between 10 to 20 years against six defendants as former mid-level and senior executives at ALC II, and jail terms of between six and ten years against executives of other companies involved in the law-breaking loan agreements.

Regarding civil responsibility, the prosecutor proposed the presiding judge to force Vu Quoc Hao to pay VND83.8 billion as compensation to ALC II. The court was also asked to force Hao and nine other accomplices to jointly pay compensations of VND387 billion to the finance leasing firm.

The hearing in HCMC is expected to last several more days.

HCM City farmers set to hone skills overseas

The People's Committee of HCM City has approved a six-year (2013-18) project to send farmers abroad for study tours and training courses.

With a total investment of over VND4.7 billion (US$222,700), the project aims at making the city's New Rural Areas programme a success and contributing to the plan for restructuring its agriculture sector.

The project is also expected to strengthen the city's integration with the regional and global communities, introduce advanced farming technologies and expand overseas markets for the city's farm produce.

Under the project, between 2014 and 2015, the city will send 100 to 125 farmers and managers from farms and agricultural co-operatives in HCM City to Thailand, South Korea, Malaysia, Singapore and China for overseas study.

The study tours will focus on how to build new rural areas; models of economic co-operation in agriculture; commercial promotion; and measures to link farming with product consumption.

They will also cover topics like the building of brands for farm produce, using advanced methods to produce plant varieties and breed animals.

City authorities have asked the HCM City Farmers' Association to establish a management board for the project with the association's Chairman as the head of the project management unit.

HCM City has 12 districts engaged in agricultural production involving over 90,000 households.

European Parliament hearing on EU-Vietnam FTA

A hearing on the EU-Vietnam Free Trade Agreement took place at the European Parliament in Brussels on November 12.

This was the European Parlimanent’s second hearing on the EU-Vietnam FTA.

Mauro Petriccinone, Chief Negotiator for the EU-Vietnam FTA negotiations announced the results of the fifth negotiation round held in Hanoi from November 4-8.

During the negotiation round, both sides agreed on four contents including the building of an equal playing field for state and private enterprises, intellectual property rights related to copyright and author’s rights, geographical indications, and sustainable development.

Petriccinone was optimistic about the negotiation process and affirmed that Vietnam is an EU’s important ASEAN partner and also a potential export and investment market of the EU. Vietnam provides gateway for the EU to approach other ASEAN countries.

He also highlighted Vietnam’s recent economic achievements and efforts to build a set of regulations relating to trade and investment.

Vu Ba Phu, Minister Counsellor to Belgium and Luxembourg, said the hearing proved positive with Petriccinone declaring for the first time that both sides were strongly  

commited to concluding negotiations late next year, well ahead of October 2014 in order to release an official statement when the tenth Asia-Europe Meeting (ASEM 10) is held in Milan, Italy the same month.

Leaders of both sides are scheduled to take part in online conferences, and sideline meetings in order to address technical matters in the negotiation process.

The EU is also in the process of FTA negotiations with some other ASEAN countries after concluding FTAs with Singapore, Thailand and Malaysia. Vietnam is the EU’s important partner in terms of politics, economics, and trade and its fifth largest partner in Asia.

The EU has been Vietnam’s largest export market with bilateral trade turnover growing considerably. In the first half of the year, Vietnam’s exports to the EU increased by 25% and EU’s exports to Vietnam by 20%.

There is high hope that the EU-Vietnam FTA will help Vietnam attract more foreign investment, enhance its competitiveness and create dynamic industries and use human resources effectively.

New opportunities arising from RoK-ASEAN FTA

Local businesses should seize new opportunities offered by the free trade agreement (FTA) between the Association of Southeast Asian Nations (ASEAN) and the Republic of Korea (RoK), said participants in a seminar in HCM City on November 12.

They said since the FTA was signed five years ago, bilateral trade ties have grown significantly, with two-way trade turnover reaching US$131.2 billion last year.

Vietnam-RoK trade value had increased by four fold to US$21.7 billion in 2012. However, they said, the figure has not yet met both sides’ huge potential.

They suggested Vietnamese and Korean businesses focus on removing trade barriers, managing product origins and conducting market surveys to take full advantage of free trade markets.

They highlighted the significance of the FTA that helps increase global competitiveness, promote exports, boost economic growth and overcome the negative impact caused by the financial crisis. As of October 2013, as many as 346 FTAs were signed, they noted.

The seminar was jointly held by the Vietnam Chamber of Commerce and Industry (VCCI) and the RoK Consulate General in HCM City to encourage the business community to seize new opportunities and deal with challenges posed by the RoK-ASEAN FTA.

Japanese businesses keen to invest in Vietnam

A seminar themed “M&A in Vietnam: Investment Attraction from Japan” was held in Tokyo on November 12.

This was part of activities to mark the 40th anniversary of Vietnam-Japan friendship, and encourage Japanese busineses to invest in Vietnam in the form of Merger and  

Acqusition (M&A) as well as Vietnamese businesses to select strategic partners.

Japan’s Former Prime Minister Fukuda said that Vietnam-Japan relations have developed strongly and stably in the form of people-to-people exchange.

He expressed his belief in Vietnam’s fast economic growth in the future and prospects for closer economic cooperation between the two countries.

He emphasized Vietnam’s advantages including geographical location, hardworking labour force, and improved infrastructure.

Vietnamese ambassador to Japan said that the Vietnamees Government will create favourable conditions for Japanese businesses to invest in Vietnam in the form of M&A.

Many Japanese businesses, especially small and medium-sized enterprises are interested in investing in Vietnam after the Vietnamese Government unveiled an industrial strategy with six priority areas needing Japanese support.

Vietnam’s commercial bank blips stunt credit growth

Experts have forecasted lower-than-expected credit growth for 2013 amid mixed results reported by the country’s commercial banks.

Sai Gon-Hanoi Bank recently said it was approved by the State Bank of Vietnam (SBV) to raise its credit growth quota for this year from 12 percent to 20 percent, after its lending increased 8.7 percent in the first nine months – significant progress compared with 2.7 percent recorded for the first half.

Ho Chi Minh City Development Bank (HDBank)'s outstanding loans were up about 20.4 percent in nine months and expected to reach 26 percent by year-end. A bank representative told VnEconomy that sharp interest rate declines, better financial capacity and rallying business performances were facilitating lending.

A Government's October report said about 11,750 enterprises were reopened in the first 10 months, and the number of newly-registered firms increased 9 percent over the same period last year.

HDBank said it is offering 1 trillion VND (47.6 million USD) with interest rates of 8-8.5 percent per year to help producers, importers and exporters supplement their capital.

Some banks, including Sacombank and Asia Commercial Bank (ACB), were reported to be gradually increasing deposit rates to the 7-9 percent range following forecasts of improved lending between now and the end of the year, especially by importers of goods for the New Year season.

SBV officials said the central bank is considering allowing banks to raise lending limits at a time when general credit growth is targeting an 11-12 percent annual goal, while it reached only 7.89 percent at the end of October.

Meanwhile, nine-month lending growth reached only 4 percent at Vietcombank, 1.2 percent at DongA Bank and "a few percent" at Vietinbank and Eximbank. Loans even declined at Southern Bank, Navibank and PGBank, according to Dau tu Chung khoan (Securities Investment).

Eximbank Deputy General Director Tran Tan Loc said the bank's nine-month outstanding loans reached only half of its annual target, although it cut lending rates for some import and export loans to below the 7-percent deposit rate cap.

ACB Deputy General Director Bui Tan Tai said enterprises are being more careful with borrowing decisions not because of interest rate pressure, but due to weak demand on the market.

"Lending has improved, but it's not easy to attain credit growth of 1.5-2 percent per month for the remainder of the year to fulfill the annual goal," said Nguyen Hoang Minh, deputy director of SBV's Ho Chi Minh City branch.

Former SBV Governor Cao Sy Kiem said general credit growth could reach 10 percent by year-end if lending progressed well in the fourth quarter. He added that more Government policies are needed to stimulate demand, although it would take time for them to take effect.

"The overall lending situation will be brighter in 2014 when business performances show clearer signs of recovery. However, the more important thing is still how to solve bad debts and clear capital flows," he said.

"The Vietnam Asset Management Company is undertaking an important role in dealing with bad debts, but a debt trading market is needed for more success," he noted.-

Preferential tax rates to rise for range of imports

The Ministry of Finance will raise taxes by up to 10 percent for 462 preferential import tariff lines next year.

The ministry reviewed 3,425 tariff lines for all kinds of products based on lists of domestically-produced goods, discouraged imports and the import value of all goods in 2012.

The review also takes into consideration its WTO commitment for 2014 and the import-tax rate. The proposed increases will be on such products as mackerel, rock lobsters and sea shrimps, crabs, soft shell crabs, white-legged shrimps, animal fat and oils.

To encourage the use of Vietnamese products, the rates will rise by 2-3 percent for domestically-produced materials and by 1-3 percent for imported mineral products.

The ministry will also increase import tax rates for imports carrying tax rates that are 0.5-1 percent lower than WTO commitments. Imports limited by quotas will surge by 5-10 percent, again to encourage the use of local goods.

The import rates on another 2,963 imports not produced domestically will be left the same. They include agricultural, forestry and aquatic products, processed farm goods, animal feed, animals and plants that are not developed domestically, raw minerals, basic chemical products and high-tech equipment that can't be made domestically.

The ministry has been collecting opinions on the increases from ministries, sectors, the Vietnam Chamber of Commerce and Industry and associations.-

Private investors fund number of road projects

The Ministry of Transport raised nearly 90 trillion VND (4.3 billion USD) from private investors to build major transport infrastructure projects in 2011-13, officials have said.

Nguyen Hoang, head of the ministry's Planning and Investment Department, said the projects include expansion of the National Highway N°1 and National Highway N°14.

Private investment has been given under several financial/management models, including build- operate- transfer (BOT), build and transfer (BT) and public private partnership (PPP).

Investment for the BOT projects to expand National Highway N°1 totalled 43.7 trillion VND (2.08 billion USD).

With private investment capital during this period, many transport projects were built according to schedule or completed early, Hoang said.

Capital was raised from many sources, including from non-State sectors, for National Highway N°1 and N°14, according to Dinh La Thang, Minister of Transport. This has helped reduce the burden on the State budget, he said.

Vietnam needs 480 trillion VND (22.86 billion USD) for the 2011-15 period and 730 trillion VND (34.76 billion USD) for 2016-20 to build roads and bridges, according to Resolution 13 NQ/TW issued in January last year.

State funds for the transport sector fell from more than 40 percent of gross domestic product (GDP) in 2010 to under 30 percent this year. The Ministry of Transport has created many preferential policies to call on private investment since 2011.

Tran Xuan Sanh, head of the ministry's Transport Engineering Construction and Quality Management Bureau, said the transport sector should create favourable conditions to attract more private investment, even though it had risen greatly in recent years.

But experts said that was made more difficult because of current policies and regulations about the period to recoup investment capital for investors. They said the transport sector should set a minimum investment level for potential investors interested in projects.

Legal rules related to these kinds of investments have not been clear and lack guiding documents, leaving investors feeling insecure, they said.-

Content marketing vital for brand success

Content marketing is helping brands attract consumers by harnessing creative platforms to promote information, according to Yahoo! Inc's senior vice president of the Asia Pacific region, Rose Tsou.

Speaking at the 28th Asian Advertising Congress in Hanoi on November 12, the Yahoo! Inc executive referred to the increasing number of internet devices and the daily habits of users, adding that brands could now utilise daily access to consumers.

Tsou also highlighted how much time consumers spent on communications and entertainment on mobile devices, emphasising that brands could not ignore the opportunity to engage more profoundly with consumers.

"Recently, e-marketers have established a poll to learn what is most important for marketers to think about. Content marketing is number one. For a long time, the advertising industry has focused very much on creative advertising rather than just looking at brands and communications in conventional ways," she said.

The industry has seen a dramatic shift in the way marketers approach consumers in the market place, according to the senior vice president, who said that the two million devices connected to the internet was estimated to double by 2017.

Tsou urged participants to set view content marketing as a staple to marketing efforts in an increasingly connected marketplace, saying that content marketing would merge brand messages and stories organically, to appeal to consumers.

"Social tools will help you share the messages and stories more widely and amplify the impact. Word of mouth is also very effective to drive more users to follow your brands. Of course, they will drive them for the purchase and transaction," she said, adding that "social marketing is one of core strategy."

Appearing on Youtube from November 2012, the "Dumb Ways to Die" video part of a campaign to educate people on train safety, has attracted 64.2 million views so far.

The marketing campaign, from an Australian advertising agency, snagged a record of five Grand Prix awards at the Cannes Lions International Festival of Creativity this year.

Taking this campaign as an example, Google Asia-Pacific chief creative officer John Merrifield emphasised the creativity and objectives of every campaign. "If you want your company to be among the top 10 brands in the country, I think it needs an amazing campaign," he said.

He said that he did not know how many likes converted into actual sales, but said these kinds of campaigns would help companies engage with audiences. Merrifield added that if a brand did not have its points of view, it would fail to attract attention.

"Did you make something easier? Did you make something better? Take something that consumers have already been doing and make that experience better," he said. "You treat them with respect and bring them into your world in the way they want to come into. That will give rewards in the future," he said.

Tsou and John were among a high-powered medley of speakers who chaired conferences during the three-day event, which attracted nearly 400 international participants to the National Convention Centre.

VAMC buys nearly 600 million USD in bad debts

The Vietnam Asset Management Company (VAMC) bought over 12.4 trillion VND (591.9 million USD) in non-performing loans from 15 commercial banks by November 10.

VAMC vice chairman Nguyen Quoc Hung said 23 banks had applied to sell 38 trillion VND (1.8 billion USD) of bad debts to the company, and application assessing was underway.

Earlier this year, the company purchased debts from Maritime Bank, Techcombank, Global Petro Bank, Agribank, Viet Nam Construction Bank, Southern Bank, Sai Gon Commercial Bank, Sai Gon-Ha Noi Bank and Petrolimex Group Bank.

The State-owned VAMC was established in late July with charter capital of 500 billion VND (23.5 million USD) to remove bad debts from the banking sector. It is expected to buy around 30-35 trillion VND (1.42-1.66 billion USD) in bad debts by the end of this year.-

Tra Vinh hopes to welcome more Japanese investors

Japanese investors are ready to set up long-term cooperation with the Mekong Delta province of Tra Vinh which possesses abundant marine resources.

Japanese Consul General in Ho Chi Minh City Hida Harumitsu made the statement at a November 12 conference held in the city to promote investment in Tra Vinh.

At the event, the provincial leaders pledged to address weaknesses including undeveloped support industry, asynchronous infrastructure system, along with improving administrative procedures and human resources quality to meet the need of investors.

The province is calling on Japanese firms to invest in several key industrial parks and projects majoring in processing farm produce for export and clean water supply.

Located 130km from Ho Chi Minh City in the south, down the Mekong River, Tra Vinh province has potential in industrial, agricultural and tourism development. However, the locality has so far secured only one Japanese-funded project worth 48.6 billion USD in registered capital.

The locality wants to set up twin relations with Japanese localities in the context that they are likely to expand investment in Vietnam .

Japan now ranks first among foreign investors in Vietnam with 5.1 billion USD in FDI capital poured into the country in 2012 and 4.7 billion USD in the first three quarters of this year.-

Japan conference highlights Vietnam’s M&A

Vietnam welcomes and will create all possible conditions for Japanese businesses to invest in Vietnam , including through merger and acquisition (M&A).

Vietnamese Ambassador to Japan Doan Xuan Hung made the affirmation during a November 12 conference in Tokyo themed “ Vietnam M&A: Attraction from Japan ” jointly hosted by Tuoi Tre (Youth) newspaper and its Japanese counterpart Mainichi with the support of Iwakaze Capital Inc and BWLaws.

He said currently, the Vietnam-Japan cooperation environment is favourable as Japanese companies, especially small and medium-sized ones, are paying much attention to Vietnam , and the Government has announced its industrialisation strategy with six prioritised areas engaging Japan .

The diplomat affirmed that all Vietnamese localities are eager and ready to welcome Japanese investors.

Speaking at the conference, which was among activities to celebrate the 40 th anniversary of Vietnam-Japan diplomatic ties, former Japanese Prime Minister Yasuo Fukuda held that bilateral relations between the two countries are growing strongly and stably, and have expanded to people-to-people exchanges.

He said it’s time for the two sides to boost bilateral economic cooperation, citing Vietnam’s strengths in attracting Japanese investment, including an abundant labour force, favourable location and increasingly completed infrastructure.

Meanwhile, Deputy Director General of the Ho Chi Minh City Stock Exchange Le Hai Tra briefed the general situation of M&A in Vietnam over the past year, as well as successful and unsuccessful affairs, legal barriers, and the process of loosening regulations for foreign investors in Vietnam .

Nguyen Trung Dung, Trade Counsellor at the Vietnamese Embassy in Japan presented Vietnam ’s M&A competition policies, and the M&A trend of Japanese enterprises in Vietnam .

Representatives from many businesses also clarified their trend of choosing partners and areas of their interest.-

HCM City, European Commission enhance industrial ties

Chairman of the Ho Chi Minh City People’s Committee Le Hoang Quan has affirmed that HCM City will create all possible conditions for European businesses to invest in the city.

Quan made the affirmation at a reception on November 12 for Vice President of the European Commission Antonio Tajani, who is leading a delegation of European businesses visiting Vietnam.

He expressed his delight at the growing cooperation between Vietnam, including Ho Chi Minh City, with the European Union in politics, economics, trade, science and education.

Over the past years, the city has also received much attention and cooperation from EU member countries, Quan said, adding that in the first half of 2013, the city imported more than 4.6 billion USD worth of products from the EU, while earning 11.7 billion USD from exports to the region.

Antonio Tajani stated his delegation’s visit aims to intensify ties in industrial development, affirming that European companies want to establish relationships with Vietnamese partners in this field.

He also stressed the EU’s hope to hold more mutual visits and exchanges to further promote cooperation in food, minerals and jewellery.

During the meeting, the two sides also exchanged information related to the investment environment and cooperation opportunities between their businesses in fields of mutual concern.

Hanoi catches up southern hub for retail investors

The latest figures on retail estate space suggest that Hanoi may be catching up with Ho Chi Minh City as the country’s most attractive destination for retail development. Report by the Vietnam Investment Review.

According to the latest report from CBRE Vietnam, Hanoi has more total retail space than Ho Chi Minh City despite the smaller population. Hanoi is home to around one million square metres of retail space, while Ho Chi Minh City has less than half of this total, at just 450,000 square metres.

The gap between the two cities will become even larger in 2015 when Hanoi is due to have up to 2.2 million square metres, triple Ho Chi Minh City’s predicted total.

This low quantity of retail space in Ho Chi Minh City has led to higher than average rents and limited choice for those seeking retail outlets.

Foreign companies looking to enter the Vietnam market, have typically begun their operations in Ho Chi Minh City due to its reputation as the country’s economic hub. However, these traditional conceptions may be changing due to the recent growth of Hanoi.

“Hanoi is the rising star, and we see that there is a shift of investment trend to the northern provinces of Vietnam, particularly Hanoi,” said Richard Leech, executive director of CBRE Vietnam.

Both Starbucks and Burger King are continuing their expansion plans, while Auchan, one of the world’s largest hypermarket chains, is considering channelling 500 million USD into Vietnam over the next 10 years. Meanwhile, burger giant McDonald’s will enter the Vietnam market in 2014.

Leech revealed that in March next year, Central Group, a renowned Thai retailer, will setup operations in Hanoi’s Vincom MegaMall Royal City.

“This will cause a remarkable change to Hanoi’s retail market because Central Group will bring hundreds of famous brands,” he predicted.

A number of large-scale retail developers are present in Vietnam. The domestic firm Vincom, owner of the new Vincom MegaMall Royal City enjoys very high occupancy rates of around 95 percent.

In Ho Chi Minh City, Coopmart is listed among the top 500 Asian retailers. The group is expanding to Hanoi later this year when they will open their second centre in the country which will supply more than 10,000 square metres of retail area.

Singaporean retailer Fairprice and Saigon Co.op have also received approval for a commercial joint-venture and will open two supermarkets named Co.opXtra and Co.opXtraPlus in the near future.

The Korean company Lotte has been gradually consolidating its presence in Vietnam with four centres already operating in Ho Chi Minh City, Dong Nai and Da Nang. The fifth Lotte centre will be opened at the beginning of next year in Hanoi’s Mipec Tower, while the Lotte Hanoi Centre, its first private Hanoi complex, will be opened in the second quarter of 2014. Lotte also has unveiled its plan to open 60 supermarkets in Vietnam by 2020.

Vietnam Business Network inaugurated in HCM City

The EU-Vietnam Business Network (EVBN) was inaugurated in Ho Chi Minh City on November 12, serving as a bridge connecting business communities of Europe, Vietnam and ASEAN region.

Speaking at the inaugural ceremony, Antonio Tajani, Vice President of the European Commission (EC) and Commissioner for Industry and Entrepreneurship said the EVBN is also expected to help EU businesses operate effectively in Vietnam and expand to other countries in the region.

The establishment of the EVBN is within the framework of a project on helping business players from the European Union (EU) to seek investment opportunities in Vietnam , which is a joint effort by the EU Delegation to Vietnam and the French Chamber of Commerce and Industry in Vietnam.

The EC Vice President is leading a business delegation on a visit to Vietnam on November 12 and 13 as part of EU’s efforts to deepen economic relations with countries in the ASE AN region, including Vietnam.

Also on November 12, the EU delegation attended a business forum and trade exchange, where they got updated on the local market and sought partners in the fields of their interest, such as pharmaceuticals, medical equipment, food and drinks, garment and textiles, and information technology.

Rice exports see sharp increase

Vietnam shipped abroad over 5.7 million tonnes of rice for nearly 2.5 billion USD in the first ten months of this year, according to the Vietnam Food Association (VFA).

The export volume included more than 537,000 tonnes shipped in October, about 10,500 tonnes higher than the figure from the previous month.

The rice exports to Europe drastically increased by 161 percent against the same period last year, followed by America (nearly 26 percent) and China (14.8 percent).

The price of rice exported increased by around 30-40 USD per tonne last month whilst that of the five-percent broken rice climbed to 365-405 USD each tonne.

The surge is attributed to a rise in price of domestic rice exports due to the great volume of rice exported to China . However, the price stood firm at 390 USD per tonne at the end of last month.

The export volume is expected to reach one billion tonnes in the remaining months of this year, raising the total volume of Vietnam’s rice exports in 2013 to around 6.7 million tonnes.-

Tra Vinh invites Japanese investors

An investment promotion seminar was held in Ho Chi Minh City on November 12 to attract more Japanese investors to the Mekong Delta province of Tra Vinh.

Tra Vinh always creates favourable conditions for foreign businesses, especially in infrastructure, human resources, and administrative procedures.

It has a number of projects on support industry, agricultural product processing, clean water supply, and rice consumption.

With its great potential for the agricultural, industrial and tourism development, the province is expected to cooperate with Japanese prefectures and enterprises who are keen on the Vietnamese market. It already has a Japanese-invested project with a total registered capitalization of US$48.64 million.

Hida Harumitsu, Japanese Consul General to HCM City, described Tra Vinh as an attractive investment destination in the Mekong Delta, saying the province has valuable natural resources and diversified cultures. Many Japanese investors want to run long-term businesses in Tra Vinh, he said.

Hida Harumitsu highlighted the fruitful results of Vietnam-Japan strategic partnership, noting that Japan granted US$3 billion in official development assistance (ODA) to Vietnam in 2011, and US$2.2 billion last year.

Currently, Japan ranks first among Vietnam’s largest international donors, with direct investment reaching US$5.1 billion last year. The figure was estimated at US$4.7 billion in the first nine months of this year.

Italian economists appraise Vietnamese market

A leading economic expert has called on Italian businesses to invest in the Vietnamese market, and considered a gateway to the Southeast Asia market.

Vice President of European Chamber of Commerce, Tomaso Andreatta, told The Sun24 hours” that Vietnam has served as an important bridge for Italian businesses to penetrate the East Asia region, particularly the ASEAN market with a population of 610 million.

He said it is high time Italian businesses realized the importance of this potential market in the years up to 2015 when ASEAN becomes a common economic bloc to expand trade ties with other major economies in the region.

He emphasized that Vietnam is now one of the fastest growing economies with skilled workers in Southeast Asia. It is pity that Italian businesses cannot seize such good opportunities and lag behind other businesses.

Italy’s leather and footwear sector is moving its plants from China to Vietnam. Its two-way trade exchange with Vietnam reached US$2.8 billion last year and US$2.3 billion  

in the first eight months of the year. However, Italy is placed 29th among 98 nations and territories investing in Vietnam.

EU-Vietnam Business Network debuts in HCM City

The EU-Vietnam Business Network (EVBN) has inaugurated its Ho Chi Minh City branch on November 12 with the aim of linking business communities in Europe, Vietnam, and the broader ASEAN region.

Addressing the inauguration ceremony, visiting European Commission Vice President and Industry and Entrepreneurship Commissioner Antonio Tajani, said the EVBN also expects to help EU businesses achieve success in Vietnam and expand into other regional markets.

The EVBN’s establishment is part of a joint project from the European Union’s (EU) Vietnam Delegation and the French Chamber of Commerce and Industry in Vietnam.

Vice President Tajani is leading a business delegation’s November 12 and 13 Vietnam visit as part of EU efforts to deepen economic relations with countries in the ASEAN region.

The EU delegation attended a business forum and trade exchange on the same day, updating their local market information and exploring potential partnerships in pharmaceuticals, medical equipment, food and drinks, garments and textiles, and information technology.

HCM City, EU promote business cooperation

Ho Chi Minh City’s dynamism is impressive and inspires efforts to expand industrial cooperation between EU and Vietnamese businesses.]

European Commission (EC) Vice-President Antonio Tajani told HCM City People's Committee Chairman Le Hoang Quan at their meeting on November 12.

Tajani described HCM City as Vietnam’s industrial leader, saying that EU businesses are expecting more meetings and representative exchange visits to promote cooperation in food, mineral ore, and jewelry.

Mr Quan believes Vice President Tajani’s visit will only add to HCM City-EU relations, especially as it related to industry. HCM City is committed to facilitating EU business investment activities.

He expressed delight at recent results from HCM City and EU collaborations in politics, economics, trade, science, and education.

HCM City imported more than US$4.6 billion worth of goods from the EU during the first half of 2013. Its half-yearly exports to EU markets were valued at US$11.7 billion.  

The city is home to 364 offices representing EU companies and groups.

HCM City leaders and EU business representatives used the reception to discuss the city’s investment environment and its various opportunities for future cooperation.

Vietnam, Kazakhstan eye all-around cooperation

Vietnam and Kazakhstan have committed to enhancing cooperation in various areas ranging from politics to economics, trade, industry, customs, judiciary, investment, culture, sports, tourism and aviation.

The commitment was made at the sixth session of the Vietnam-Kazakhstan Inter-governmental Committee on Economic, Trade and Scientific-Technological Cooperation in Hanoi on November 12.

Vietnamese Deputy Minister of Industry and Trade Le Duong Quang and Kazakh Deputy Foreign Minister S. Sarubai co-chaired the event.

The two sides assessed the implementation of the previous session’s minutes, the Joint Action Plan for the 2011-2013 period, and outcomes of bilateral economic, trade, scientific and technological cooperation over the past time.

They also discussed issues affecting their cooperation while proposing concrete solutions to enhance the linkage in the time to come.

Deputy Minister Quang said political and diplomatic ties have developed fruitfully.

He said the visit to Vietnam by Kazakh President N. Nazabaev at the end of 2011 and the visit to Kazakhstan by President Truong Tan Sang in September last year have created an impulse for further economic and trade links between the two countries.

Vietnam and Kazakhstan have signed several important cooperative documents in various realms during the 2011-2013 period, including agreements on animal quarantine  

and protection, investment encouragement and protection, tourism cooperation and judicial assistance in civil and trade sectors, he said, adding that many others are under consideration.

Deputy Minister S. Sarubai announced Kazakhstan’s decision to open its Embassy in Vietnam next year to boost bilateral ties.

In an effort to create a legal framework for economic and trade cooperation, the two sides have also taken the initiative in negotiating the free trade agreement between Vietnam and the Customs Union of Belarus, Kazakhstan and Russia since early this year.

They also accelerated cooperation in culture, sports, tourism, aviation and investment, he said, citing direct flights from Almaty to Ho Chi Minh City launched by Kazakhstan’s national flag carrier, Air Astana.

Statistics released by the Vietnam Ministry of Industry and Trade show that two-way trade between Vietnam and Kazakhstan have recorded remarkable growth with export-import value reaching US$85.6 million last year, up 176 percent against the previous year.

In the first half of this year, bilateral trade revenue hit US$74.7 million, representing a year-on-year increase of over 200 percent.

Vietnam’s major exports to Kazakhstan include phones and attached accessories, farm produce, garments and textiles, machinery and steel while importing chemicals, metals and ore from the country.

Tax and customs revamp urged to reduce red tape

Enterprises had asked customs and taxation departments to simplify procedures, according to an official from the Viet Nam Chamber of Commerce and Industry (VCCI).

The VCCI found that more than 70 per cent of the 1,500 enterprises surveyed in 2013 complained that customs clearance was too slow, said Hoang Quang Phong, head of the VCCI's Membership and Training Division.

He was speaking at a meeting with enterprises on administrative procedures and tax and customs policies held in Ha Noi on Wednesday.

Phong said 69 per cent of those enterprises had to wait for over 30 minutes for feedback on declarations, and needed help to complete simple customs procedures. The customs department has been targeted with a time of less than 30 minutes.

The enterprises said one of reasons for the slow customs clearance was that there were often errors on the e-customs system.

They also complained that there were often overlapping regulations that cost them time and money.

Phong said most enterprises agreed that customs and taxation offices had simplified some administrative procedures, but a deadline was needed to speed them up with a clear legal framework to facilitate global economic integration.

The State should set preferential tax policies for enterprises with an annual revenue of under VND20 billion (US$943,300) to help small enterprises.

The customs office should apply IT to clear goods and save time and money.

The enterprises said the two offices should offer support for small and medium sized enterprises, and train them on customs and tax policies and regulations.

They asked the Ministry of Finance to set uniform standards across the board for customs and tax procedures. They also asked the finance ministry to increase the efficiency of the customs and tax hotline.

Deputy Finance Minister Do Hoang Anh Tuan agreed with the survey, and said that the customs and taxation sectors had created favourable conditions for enterprises to solve administrative procedures.

The two sectors would continue to review procedures and make adjustments where necessary, Tuan said.

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