Tiki reports second year of losses

Tiki’s consecutive losses raise the question whether these are still planned losses or are a result of losing the e-commerce race to competition.

Tiki was established in 2010 as a startup e-bookstore but has since diversified operations to sell phones, tablets, digital devices, electrical appliances, toys, and souvenirs.

In August 2013, Tiki signed a strategic partnership with Japan’s Sumitomo Corporation and became the first e-commerce company in Vietnam to receive investment from the Japanese company.

Under the partnership, Sumitomo would hold a 30 per cent stake in Tiki to become its second strategic investor, after Japanese investment fund CyberAgent Ventures (15 per cent).

In May 2016, VNG Corporation, Vietnam's top provider of Internet content, completed a VND383-billion ($17.02 million) deal to acquire a 38 per cent stake in Tiki. Accordingly, VNG spent VND104,000 ($4.57) per share, with the expectation to acquire benefits from one of the largest e-commercial platforms in Vietnam.

With backing from Japanese investors Sumitomo Corporation and CyberAgent Ventures, which own a combined stake of 45 per cent, in collaboration with the investment from VNG, Tiki was expected to become a heavyweight in the e-commerce sector in the country. However, the firm has been reporting losses for two consecutive years now.

Notably, according to the financial statement of VNG Corporation, a shareholder of Tiki, in 2017 Tiki reported a loss of VND282 billion ($12.38 million), triple its charter capital and seven times higher than the loss in 2016. Hence, Tiki’s total losses two years after receiving investment from VNG were VND320 billion ($14.05 million).

Tiki CEO Tran Ngoc Thai Son stated that the losses are a part of the firm’s long-term development plan. Tiki is expanding its scale of operations via investing in infrastructure, warehouses, human resources, and technology.

In reality, according to the statistics of Euromonitor, Tiki ranked sixth among the online shopping sites of Vietnam in 2017 with the visitor volume of 15.08 million. However, according to customers, there is a painful lack of transparency in Tiki’s promotion programmes. Notably, the firm often increases selling price quietly to then provide discounts at the original price.

Earlier this year, Tiki received $54 million in Series C investment made by Chinese internet giant JD.com and South Korea's STIC Investments. The additional capital is expected help Tiki to consolidate its market presence.

At present, the Vietnamese e-commerce sector holds great potential but is also a playground ruled by strict competition by numerous heavyweights.

The fierce competition was shown after a series of e-commerce floors had to shut down because of big losses. Beyeu, Deca, and Lingo left the market after long struggles to survive.

According to industry insiders, companies need to allocate enormous expenses for their e-commerce business from sales and marketing to warehousing and logistics, so it can easily eat up profits. Also, many platforms suffered losses from special discount offers and promotion campaigns to snag new customers.

At present, it is still early to conclude that the consecutive losses of Tiki is a show of weakness, however, Beyeu, Deca, and Lingo are signals that the market is not for players lacking financial potential or methodical development strategies.

VINACAS Golden Cashew Rendezvous to be held in Halong Bay

The 10th Vietnam Cashew Association (VINACAS) Golden Cashew Rendezvous (GCR-2018), a Vietnamese national trade promotion program, will be held from October 5 to 7 in Ha Long Bay. Ha Long Bay is a UNESCO World Heritage Site and an iconic tourism destination of Vietnam.

The program is organized by the Vietnam Cashew Association (VINACAS) and is supported by the Ministry of Industry and Trade and Ministry of Agriculture and Rural Development of Vietnam.

As the world’s cashew hub, the GCR-2018 is the place where more than 500 esteemed cashew stakeholders can find real cashew partners and deals and acquire the most reliable cashew information and forecasts from qualified panelists from all over the world.

VINACAS hopes that all cashew kernel buyers, raw cashew nut sellers, and other cashew stakeholders will have a wonderful time and enjoy Vietnam’s unique atmosphere, splendid scenery and traditional cuisine. 

One day prior to the event, a wonderful tour called “Cashew Roadshow” will be held from Hanoi to Ha Long Bay. Along the Cashew Roadshow, attendees will have the opportunity to visit the sites and culture of Vietnam’s capital, Hanoi. These places include Hanoi Old Town, Hanoi Water Puppet Show, and Bat Trang Pottery Village, which are on the list of top ten destinations by TripAdvisor. Upon arrival at Ha Long Bay, the attendees can enjoy the marvelous “Ha Long Bay Sea-Caravan Tour.”

In addition to the pre-tour, the organizers will bring the participants on a memorable trekking post-tour from Ha Long Bay to Sapa - a mountainous region in the north of Vietnam where there are a few nearby cashew processing units.

Sapa, one of the most attractive tourism destinations in the country, is a precious gift that Mother Nature has given Vietnam. Located here is Fansipan or "The Roof of Indochina," where one can view many picturesque sights.

UOB to debut in July

The Singapore-based United Overseas Bank (UOB) has received a business registration license and is scheduled to open on July 2.

Under the license, the bank will be able to expand its network in the country enabling UOB to extend financial support and offer best-in-class products and service to consumers and businesses beyond Ho Chi Minh City.

UOB Vietnam has a charter capital of VND3 trillion ($131.3 million) and has permission to operate in the country for 99 years.

This is the first Singaporean bank in Vietnam and is the ninth bank with 100 per cent foreign capital in Vietnam.

On March 23 last year, during Singaporean Prime Minister Lee Hsien Loong’s visit to the country,  the State Bank of Vietnam announced that it had given preliminary approval for UOB to set up in Vietnam. The bank received its in-principle license in July of the same year.

Previously, UOB had launched a business banking service dedicated to helping small businesses in Vietnam grow. This followed the State Bank of Vietnam’s licensing of UOB as a foreign-owned subsidiary bank on September 26, 2017.

The bank recently signed a memorandum of understanding (MoU) with Toong to provide UOB’s small and medium-sized enterprise (SME) customers with preferential rentals at any of Toong’s five co-working office spaces in Vietnam.

UOB customers will enjoy up to 20 per cent off rentals and have access to Toong’s business partners, including legal and accounting firms, who can advise them on issues such as local incorporation.

The bank has also partnered with the Foreign Trade University (FTU) to launch the finance industry’s first tertiary education program designed for small business bankers in Vietnam.

Aside from UOB Vietnam, the eight other foreign banks in Vietnam are Standard Chartered (UK), Shinhan Vietnam (the Republic of Korea), Hong Leong Bank, CIMB, Public Bank Berhad (Malaysia), CitiBank (US), HSBC (Hong Kong), ANZ (Australia).

Online counterfeit goods trap consumers

Fraudulent trading and counterfeits have been complicated in the southern province of Dong Nai. Violations have become more diverse, highly sophisticated, and uncontrolled, especially trading and rampant advertising cosmetics and pharmaceuticals via the social network.

Some traditional medicines labeled as "Ethno medicine" for various illness including joint treatment, cough, diabetes, and even gynecology are advertised widely on Facebook, said the Dong Nai province Department of Market Management.

Without prescribing or consulting with doctors, consumers can click through to purchase and receive folk medicines at home with a guarantee of "a full refund if they do not work" offered by "online pharmacists".

However, not only is it hard to check the origin and use of these drugs but also they pose a lot of potential health risks. For example, some mothers have recently passed on the use of a cough medicine for kids which was widely advertised on Facebook. It was said to be an application for pain relief, swelling, cough, cold, healing, burns, insect bites, acne, and itchy rash. The online pharmacists also asserted that the drug was 100 percent natural, formulated by the Dao, and safe for all ages, including infants.

However, the medicine was detected falsely labeling its features and use which were originally in the form of emulsion, deodorant, and anti-odor to assist with massage and skin care.

It is hard to monitor the quality of the folk medicines heavily advertised online. These products represent both a cost to consumers' pockets and a risk to their health as they are often mixed with modern ingredients to bring immediate effects such as pain relief, acne clearing, firm and youthful skin maintaining, appetite increasing, and weight gain, according to the authorities.

"The use of traditional medicines actually takes a certain amount of time and does not work immediately. That some people trust in the misleading advertisement for drugs derived from nature and use for a long time causes a danger to their health", a traditional medical practitioner warned.

During the first quarter of 2018, the authorities carried out over 630 inspections, detected 280 violations, fined, and remitted about VND 2.6 billion to the state's budget, the department reported.

In particular, counterfeits accounted for the highest rate with 114 cases, food safety 94 cases. The rest included smuggled goods and undocumented foreign goods with low quality.

Cosmetic counterfeits are the most common. The Feb.2 inspection of the HMH Trading & Services Co., Ltd (Tam Hiep Ward, Bien Hoa City) came upon more than 600 products without challan, most of them were cosmetics, such as toner, moisturizer, face cleanser, shampoo, conditioner, and lipstick.

Previously, the authorities also conducted a spot check on the branch of HV Cosmetics Company (Trang Dai Ward, Bien Hoa City) and found out thousands of undocumented cosmetics, including 18,000 bottles of body lotions, 224 bottles of body shower, 432 bottles of whitening cream, and 40kilogram of cream ingredient and other additives.

According to Mr. Huynh Kim Hoa, Head of Professional and Staff Division under Dong Nai Department of Market Management, the department directed the relevant teams to enhance market inspection and control as well as to propagate business households and individuals to strictly comply with the provisions of law to combat against smuggling, counterfeits, and commercial fraud.

However, the obstacles to access product information and establishments, and those trading online resulted in the limited number of cases detected and handled by authorities, Hoa concluded.

GDP grows 7.38% in Q1

This year’s first quarter saw the nation’s gross domestic product (GDP) growth hitting 7.38%, or 30 basis points higher than in the final quarter of 2017, heard a meeting of the National Assembly Standing Committee.

Ha Ngoc Chien, head of the NA Ethnic Council, was quoted by VnEconomy as saying at the meeting on May 14  that the higher GDP growth rate of last quarter was a good result, as GDP growth in the first quarter of the previous years was often lower than in other quarters.

Deputies attending the meeting spoke highly of positive socio-economic results of last year.

Chairwoman of the NA Justice Committee Le Thi Nga said the Government had acted promptly upon pressing issues, and relevant agencies have managed to live up to commitments by the Government. Such performance is made possible owing to a working group having been established to oversee the implementation of conclusions of Government leaders, she added.

According to Nga, much red tape has been removed. In addition, the Government has operated in a more transparent manner when dealing with cases such as the MobiFone-AVG deal and the 12 loss-making projects under the management of the Ministry of Industry and Trade. 

However, while factors behind good results were analyzed in detail in socio-economic reports, areas with poor performance have not been brought to light, head of the NA Committee for Legal Affairs Nguyen Khac Dinh commented on the Government’s reports.

According to Dinh, export growth has still depended greatly on foreign direct investment (FDI) enterprises. Besides, the capital of investment projects licensed in January-March averaged out at only US$3.4 million, equivalent to one third of the projects in 2014.

Head of the NA Committee for External Relations Nguyen Van Giau asked the Government to pay special attention to dealing with weaknesses and drawbacks of the economy, including low labor productivity.

CAAV rejects service discounts for Etihad Airways

The Civil Aviation Authority of Vietnam (CAAV) has requested the Ministry of Transport to not offer service discounts on flights to Vietnam as requested by the UAE’s Etihad Airways.

According to the CAAV, the price range for air services is stipulated in Decision 2345/QD-BGTVT dated August 8, 2017, which does not provide special price policies for airlines operating flights to and from Vietnam. The discount request by Etihad Airways cannot be accepted.

Since October 2013, Etihad Airways has been operating flights to and from Vietnam’s Noi Bai and Tan Son Nhat international airports. Of these, Abu Dhabi-Tan Son Nhat flights are operated on a regular basis.

In fact, discounts have been offered to airlines but at some smaller airports only.

In 2013, the Ministry of Transport provided special service prices for international airlines flying to Phu Bai, Cam Ranh, Lien Khuong, Can Tho and Phu Quoc airports, with discounts of up to 50% on landing, takeoff and security screening services in up to three years.

The discounts were applicable to new airports which have handled a small number of international flights. As for Noi Bai and Tan Son Nhat airports, only special cases can enjoy service discounts.

In related news, the Ministry of Transport has permitted Thai Vietjet to continue operating flights between Lam Dong Province’s Dalat City and Bangkok of Thailand. The Ministry of National Defense earlier agreed on Thai Vietjet operating regular flights between Dalat and Bangkok to promote the province’s economy and tourism, attract investors, and stimulate trade between the two countries.

Dalat-Bangkok flights were operated between December 18, 2017 and March 24, 2018 with four flights per week using A320 and A321 aircraft.

Forum spotlights business development in digital age

Telecom and Internet providers in Vietnam have recorded 6.1 billion USD in revenue and created more than 851,000 jobs, as heard at a forum on enterprises in digital age held in Hanoi on May 17.

The forum took place in conjunction with the announcement of the Vietnam Chamber of Commerce and Industry (VCCI)’s annual report on Vietnam business for 2017/2018.

As heard at the forum, IT and telecom sector’s production value contributed over 0.7 percent to the nation’s GDP on average. In 2016, the number of IT/telecom businesses surpassed 11,000, accounting for 2.2 percent of Vietnam’s total figure. 

Apart from the application of advanced technologies in traditional sectors, the digital age has given birth to a number of non-traditional business models in Vietnam, like online car hailing and financial technology (fintech) services.

Expert said fast changes of these new models have sometimes left legal regulations behind, thus causing difficulties for their providers and benefit conflicts between them and their traditional peers.

VCCI Chairman Vu Tien Loc said last year, the Prime Minister issued Decree 16 on capacity building for the 4.0 industrial revolution.

He said the decree put forth key measures on IT infrastructure development, and prioritised the building of digital industry, smart agriculture, and smart cities.

He noted companies ought to design their relevant action plans and join the public sector’s efforts in building strategies for smart governance and innovation.

Loc also acknowledged achievement of the business sector last year, with the establishment of 126,859 new firms, the highest number recorded to date.

Pham Thi Thu Hang, head of the Vietnam Business Insight Survey – a VCCI initiative, said the year saw improvements in the private sector, but the trend of smaller-scale firms persisted and the rate of performance failure among small scale businesses remained high.

Seminar collects opinions on inspection on exports-imports

A seminar took place in Hanoi on May 17 to collect opinions on building the draft Decree on the national one-stop shop mechanism and specialised inspection on exports-imports. 

Co-organised by the United States Agency for International Development (USAID) and the Finance Ministry’s General Department of Vietnam Customs, the event attracted over 100 delegates from ministries, agencies, local customs and businesses. 

Speaking at the event, Deputy Director General of the Vietnam Customs Nguyen Cong Binh said administrative reform on exports-imports has been the top priority of the Government in recent years, adding that the Decree No.19 on improving business climate and national competitiveness requests reducing the rate of goods under specialised inspection in customs clearance to below 10 percent from 25 – 27 percent at present. 

Despite achievements in administrative reform, the World Bank’s Doing Business Index pointed out that Vietnamese enterprises still meet difficulties in abiding by regulations on specialised inspection on exports-imports, he said. 

Pham Thanh Binh, advisory expert for the USAID’s GIG project, said regulations on specialised inspection on exports-imports are set in laws, decrees and circulars of ministries and agencies, leading to overlapping in management. 

Launched in November 2014, the national one-stop shop mechanism has so far connected with 11 out of 14 ministries and departments and 47 out of 284 administrative procedures on specialised inspection. However, a number of procedures on specialised inspection are yet to be conducted online. 

The draft Decree on the national one-stop shop mechanism and specialised inspection on exports-imports will help simplify customs clearance procedures and establish an inter-sectoral mechanism to ensure effective coordination among units via the national one-stop shop.

The Vietnamese Government is also working with the USAID via the Governance for Inclusive Growth Programme to facilitate sustainable and inclusive economic growth in the country.

Tien Giang expands fruit production as prices rise

Tien Giang province, the Mekong Delta’s largest fruit producer, has increased its fruit cultivation area to nearly 75,000ha this year, up three percent against the same period last year.

Farmers have planted 1,300ha of new dragon fruit, 1,200ha of pineapple and 400ha of new green-peel and pink-flesh grapefruit this year.  

Under its agricultural structuring plan, the province has encouraged farmers to turn farmland unsuited to growing rice into fruit orchards.   

Cao Van Hoa, Director of the province’s Department of Agriculture and Rural Development, said the province had set up concentrated fruit planting areas to produce specialty fruits for domestic and export markets.

Specialty exports include Lo Ren Vinh Kim milk apple in Chau Thanh district, Ngu Hiep durian in Cai Lay district, and citrus fruits in flood-prone districts.

The province has also established a 7,000 concentrated durian planting area in Cai Lay district, the largest durian planting area in the Mekong Delta.

The milk apples, which are exported to the US, offer high profits for farmers.

Advanced farming techniques, especially for off-season fruits, and good quality seeds have helped farmers increase profits by 300 million – 500 million VND (13,200 – 22,000 USD) per ha of specialty fruit a year. Some farmers can earn a profit of up to 1 billion VND (44,000 USD) per ha a year.

Huynh Van Kem, who plants 7,000sq.m of two specialty durian varieties - Ri6 and Mong Thong - in Cai Lay district, said he harvests an average of 20 tonnes of durian a year and earns a profit of 1 billion VND.

Durian yields high profits, but farmers must choose good seedlings, use advanced farming techniques and produce off-season fruits, according to Kem.

Le Van Can in Cho Gao district said he earns a profit of 100 million VND a year from planting 4,000sq.m of dragon fruit.

This profit is four times higher than from rice, he said, adding that he planted rice on his farmland.

Concentrated fruit planting trees have helped farmers increase their income, according to the province’s Department of Agriculture and Rural Development.

The province has also started production chains for durian, Hoa Loc mango and dragon fruit cultivation to 2020.

The development of new fruit orchards has increased the demand for fruit seedlings.

Ut Phuong, a fruit seedlings producer in Cai Lay district, said the price of seedlings of Ri 6 and Mong Thong durian varieties had risen to 100,000 VND a seedling, up two times against the same period last year.

Vietnam continues to enjoy large trade surplus in UK market

Vietnam enjoyed a 1.5 billion USD trade surplus with the UK for the first four months of 2018 as the country exported 1.75 billion USD worth of goods to the market and imported 238 million USD.

According to the General Statistics Office (GSO), Vietnam’s export revenue to the European country in the first three months of 2018 reached 1.31 billion USD, up 30.6 percent over the same period last year.

Meanwhile, Vietnam imported 185 million USD worth of goods from the UK, up 17.6 percent year on year, resulting in a big trade imbalance.

From January until the end of April, Vietnam mainly exported to the UK telephones and spare parts, footwear, garment, and aquatic products, with respective export value exceeding 705 million USD, 201 million USD, 215 million USD and 78 million USD.

At the same time, Vietnam imported from the UK 67 million USD worth of machineries, equipment and spare part, 45 million USD of pharmaceuticals and more than 13 million USD of chemicals.

Earlier in 2013-2017, the UK was among the 15 largest trade partners of Vietnam with average annual growth of nearly 5 percent. Two-way trade grew a total 44 percent in the review period to 6.15 billion USD in 2017 from 4.27 billion USD in 2013.

Last year, the UK was the eighth biggest export market of Vietnam, one position higher than 2016. Meanwhile, it was Vietnam’s 26th biggest import market, down two positions compared to the previous year.

In the past five years, Vietnam’s exports to the UK surged 46.4 percent to 5.42 billion USD, accounting for 2.5 percent of the country’s total export volume.

In the same period, the Southeast Asian’s import revenue in the UK market increased 30 percent, reaching 733 million USD in 2017.

Vietnam continuously enjoyed a large trade surplus with the UK, with last year’s figure hitting 4.68 billion USD.

The UK is also the third biggest trade partner of Vietnam among EU countries.

Proposed regime for reporting market prices

The Ministry of Finance (MoF) has drafted a circular on rules and methods of collecting information and reporting market prices of some domestic goods and services.

The move aims to facilitate the synthesis, analysis and projection of commodities prices by central and local agencies, in order to standardise information and gain a better picture of the national inflation situation.

The list of commodities and services subjected to the newly-recommended market price reporting regime includes essential commodities that can represent groups of goods and services relating to food, construction materials, medicines and medical services, transportation, education, entertainment and tourism.

The draft recommends that the Departments of Finance of centrally-run cities and provinces nationwide send monthly, quarterly and annual reports on market prices of commodities in their localities to the MoF’s Price Management Department.

Reports will include information on the evolution of the consumer price index (CPI) calculated within each locality, together with analysis on the status and the causes of the factors affecting CPI.

The reports also evaluate the efficiency of local management and administration of prices, including the price management of some important and essential goods in the locality and the promulgation of legal documents related to commodities’ market prices.

In addition, the reports will also forecast the CPI and the market price situation in the next period.

In case of abnormal fluctuations in prices, the provincial and municipal Department of Finance have to make irregular reports on price fluctuations of some essential goods and services in the locality.

The commodities included in the price report include rice, pork, beef, chicken, fish, shrimp and seasonal vegetables (for food), cement, construction steel, sand, bricks (for construction materials), car fare, bus fare, taxi fare (for transportation services), tuition fees of public kindergartens, public school fees and university fees (for education).

The Ministry of Finance is gathering public comments on this draft by posting the draft in the Ministry’s e-Portal.

HCMC boosts supporting industries

HCM City is enacting policies to aid businesses in the supporting industry by encouraging investment, networking between firms and banks, and creating special zones.

The city’s People’s Committee has approved 15 investment projects related to the mechanical, plastic and food industries, with total investment of VND938 billion (US$41 million), VND581 billion of which would be supported by the government in the form of paid interest on loans, according to the city’s Department of Industry and Trade.

A city multi-disciplinary team has also appraised nine projects, at a total of VND943 billion. Two of them have been approved by the city.

The HCM City Export Processing and Industrial Zones Authority (HEPZA) is working with related authorities to form supporting-industry zones in Hiep Phuoc Industrial Zone and Le Minh Xuan 3 Industrial Zone.

Nguyen Phuong Dong, deputy director of the Department of Industry and Trade, said that to provide space for businesses to operate, HEPZA was also building factories at Tan Thuan Export Processing Zone and Linh Trung 1 Export Processing Zone.

Factories in the former are already being rented, while those in the latter are expected to start construction within this month.

In addition, the Department of Industry and Trade is working with the State Bank of Viet Nam - HCM City Branch to connect banks with businesses and encourage credit unions and financial institutions to offer credit packages to businesses in the supporting industry.

Also, in accordance with Circular 29/2018/TT-BTC issued by the Ministry of Finance to manage funding for supporting industry development, nation-wide cities and provinces including HCMC can use state funds to provide financial aid to companies and organisations so they can organise exhibitions and conferences on attracting investment.

Accordingly, the companies and organisations in the city would be given up to 70 per cent of the total costs for such activities, or up to VND12 million per participant, as well as help in promotion and brand registration, up to VND50 million per brand.

Also, according to the circular, the costs for sending business delegations to events in other countries will also be covered up to VND70 million per participant, depending on the country.

In addition, the costs for appraisal, counselling and certification for businesses in the supporting industry would be fully covered by the State Budget.

All of these efforts are part of HCM City’s plan to develop its supporting industry. The city targets meeting 45 per cent of national demand for manufactured inputs by 2020 and 65 per cent by 2025.

The supporting industry has not grown as quickly as others, affecting the city’s economic development as a whole.

Vietnam Airlines to build logistic hub in Can Tho

The Vietnam Airlines Corporation plans to build a logistics centre in the southern city of Can Tho this year, said Deputy General Director Trinh Hong Quang at a meeting with local leaders on Friday.

The 30ha centre will be built next to Can Tho International Airport to meet the increasing demand of goods transportation by international and domestic airlines, with a capacity of transporting at least 600,000 tonnes of goods per year.

Along with the construction of Can Tho logistics centre, Quang said the corporation will open new routes from the city to other destinations in Viet Nam and abroad.

He said the corporation opened three logistics centres at Noi Bai, Tan Son Nhat and Da Nang international airports, however expanding these centres was difficult due to a lack of land.

According to General Director of Tan Son Nhat Cargo Service Joint Stock Company Nguyen Cao Cuong, cargo throughput at Can Tho International Airport is currently 4,200 tonnes per year. Meanwhile, the output of agricultural and fishery products and other products of Can Tho through Tan Son Nhat International Airport is 150 tonnes per day.

Speaking at the meeting, Vice Chairman of municipal People’s Committee Dao Anh Dung said the city was ready to create good conditions for Vietnam Airlines to build a logistics hub.

He expected the corporation to work with Can Tho City to complete the procedures soon to receive an investment licence in August, when the city will host an investment promotion conference.

Hoa Sen puts up steel construction pipe plant in Yen Bai

Steel maker Hoa Sen Group on Friday inaugurated a plant that can produce 60,000 tonnes of steel construction pipes annually in the northern province of Yen Bai.

The 20ha Hoa Sen Yen Bai cost VNĐ1.05 trillion.

It is expected to meet the demand for steel pipes in the north-west.

The production lines incorporate modern technologies imported from foreign countries, the company said.

In the first phase, the plant would employ 100 workers, it said.

Expanding production is one of its strategies now, it added.

Hoa Sen has 11 plants around the country equipped with modern technologies.

Spreading them around the country helps the company save transport costs and reduce delivery times.

It is also focusing on developing its distribution system by opening more branches and sales points. It now has 400 branches.

The giant steel maker exports its products to many markets around the world.

VN records huge trade surplus in UK market

Viet Nam recorded a trade surplus of US$1.5 billion with the United Kingdom in the first four months of 2018.

The country exported $1.75 billion worth of goods to the market and imported $238 million.

According to the General Statistics Office, Viet Nam’s export revenue to the European country in the first three months of 2018 reached $1.31 billion, up by 30.6 per cent over the same period last year.

Meanwhile, Viet Nam imported $185 million worth of goods from the United Kingdom, up by 17.6 per cent year-on-year, resulting in a huge trade imbalance.

From January until the end of April, Viet Nam mainly exported telephones and spare parts, footwear, garments and aquatic products, with the respective export values exceeding $705 million, $201 million, $215 million and $78 million.

At the same time, Viet Nam imported $67 million worth of machineries, equipment and spare parts, $45 million worth of pharmaceuticals and more than $13 million worth of chemicals.

During 2013-17, the United Kingdom was among the 15 largest trade partners of Viet Nam, with an average annual growth of nearly 5 per cent. Bilateral trade grew by a total of 44 percent in the reviewed period to $6.15 billion in 2017 from $4.27 billion in 2013.

Last year, the United Kingdom was the eighth-largest export market of Viet Nam, moving up one place from 2016. Meanwhile, it was Viet Nam’s 26th largest import market, down by two places compared to the previous year.

In the past five years, Viet Nam’s exports to the United Kingdom have surged by 46.4 per cent to $5.42 billion, accounting for 2.5 per cent of the country’s total export volume.

In the same period, Southeast Asia’s import revenue in the UK market has increased by 30 per cent, reaching $733 million in 2017.

Viet Nam has continuously enjoyed a huge trade surplus with the United Kingdom, with last year’s figure hitting $4.68 billion.

The United Kingdom is also the third-largest trade partner of Viet Nam among the EU (European Union) countries.

AES Corporation keen to invest in thermal plant

US-based AES Corporation wants to invest in Son My 2 thermal power plant in the central province of Binh Thuan under the form of Build-Operate-Transfer (BOT).

The proposal was made by AES Vietnam President David Stone at a meeting with Deputy Prime Minister Vuong Dinh Hue in Ha Noi on Thursday.

Stone said AES was listed among the 200 global energy companies ranked by Fortune magazine. The company currently owns a liquefied natural gas (LNG) project in the Dominican Republic and had invested in an LNG depot in Panama.

At the meeting, Stone said his company was carrying out researches for investment in Son My 2 gas-fired thermal power project in the form of BOT and hoped its participation would contribute to boosting trade and investment between Viet Nam and the United States.

The project consists of three LNG-powered plants, with a designed capacity of 750MW each. Built at the Son My industry-services-gas complex in the central coastal province of Binh Thuan, the facilities are set to become operational in 2023-25.

Hue said he supported the LNG terminal project, urging both sides to speed up the signing of a partnership contract to implement the project at the earliest.

Regarding the Son My 2 project, he requested AES to work with PV Gas to identify the most suitable investment model, adding that the Vietnamese Ministry of Industry and Trade will directly address difficulties, if any, arising from the cooperation.

AES is known for its 1,242MW Mong Duong 2 power plant in the northern province of Quang Ninh in Viet Nam. The coal-fired power plant was built under a BOT agreement and will be transferred to the Government after 25 years. It has been constructed in collaboration with PetroVietnam Gas JSC to carry out a liquefied gas depot project in Ham Tan District in Binh Thuan Province.

StoxPlus: Cement industry to recover through robust export activities

As stated in StoxPlus Cement Market Report 2018, the Viet Nam cement and clinker sales volume reached 80.3 million tonnes in 2017, posting an increasing growth rate for three years in a row. Although the domestic consumption contributed to more than 70 per cent of the total sales for several years, the recent years have witnessed a sluggish growth rate from 9.5 per cent (2015) to 1.4 per cent (2017). While domestic consumption sustained its growth, the export activity drove the market with the export volume surging up to 19.7 million tonnes, leading to a robust growth of 27.7 per cent year on year, thanks to the increasing demand from key markets, including Bangladesh and the Philippines.

Additionally, China emerged as a potential export market as the Chinese government has implemented an unprecedented pollution crackdown in November 2017, with the country shutting down tens of thousands of cement factories in an effort to address China’s air pollution. Compared to 2016, the cement export volume fell sharply by 21.4 per cent, while clinker posted a strong growth of 53.8 per cent, making it the key driver of cement exports in 2017. This could be explained by the fact that foreign countries tend to favour clinker imports over cement due to the cost, and this trend will continue to shape Viet Nam’s cement exports in the long-term prospects.

Supply: While local private companies continued to launch “mega” projects, the foreign giant strengthened its presence via M&A activities

According to StoxPlus database, there are some 107 cement facilities with a total capacity of 120.9 million tonnes per year (MTPY) belonging to 93 companies in Viet Nam, of which VICEM and foreign-owned companies recorded high utilisation of more than 80 per cent. In 2017, private companies continued to operate five new “mega” projects with total capacity of up to 18.5 MTPY, resulting in a surge in the total production capacity by 18 per cent. The projects are developed not only by giant local private companies such as Vissai or ThaiGroup, but also by other local players, especially Thanh Thang and Long Son, which indicated a trend in favour of large-scale projects.

In line with StoxPlus’s analysis, cement facilities can hardly operate efficiently if the designed capacity is under one MTPY, especially when taking into account the electricity cost, maintenance expenses and other fixed costs. With regard to foreign players, 2017 witnessed active M&A prospects when SCCC and SCG invested heavily through the entire ordinary share acquisition of LafargeHolcim and VCM, respectively.

Positive signal from regulatory framework

In December 2017, the Vietnamese Government issued Decree No 125/2017/ND-CP, which is expected to boost Viet Nam’s cement export activities. The entitled zero per cent export tariff for cement has sharpened Viet Nam’s competitiveness, especially in the fierce race with ASEAN countries apart from China. It is estimated that export companies can now enjoy higher profit by US$3-4.5 per tonne under the new tariff.

Additionally, enterprises are being encouraged to participate in export activities thanks to the VAT reimbursement scheme. New regulations have taken effect immediately, which is indicated in the 4M/2018 export results. In 4M/2018, the total cement sales reached 29.83 million tonnes, recording a growth rate of 13 per cent year on year, mostly owing to the active export activities which increased by 29 per cent year on year.

Based on StoxPlus analysis of macroeconomics and the historical cement demand since 2000, associated with the impact of related factors such as the status of infrastructure development and the residential house construction recently, the demand for cement is projected to grow at a rate of 5 per cent until 2030. Viet Nam is expected to face continuous supply surplus before reaching the equilibrium in 2027 at 130.8 million tonnes of cement, if the uncertain cement projects in Viet Nam are not taken into account. Even though Viet Nam’s cement sector still moves in tandem with the real estate boom and burst, this industry is still expected to enjoy healthy growth in the years to come.

Telefilm expo attracts 250 exhibitors

The sixth Vietnam International Exhibition on Film and Television Technology (Telefilm) will be held next month in HCM City, showcasing products, services and technologies used in film and television.

It has attracted more than 250 exhibitors from 15 countries and territories and more than 2,000 film and television technology professionals.

On display will be TV programmes and serials; value-added and support services; technology and solutions for the TV, media, and communications industries and for image processing and transmission; and post-production services,

Several seminars will be held on the sidelines on current television trends amid rapid digitisation in the TV industry globally and in Viet Nam.

As a prestigious international exhibition specialising in film and television, Telefilm will offer visitors the opportunity to meet potential partners and learn about the latest international film and television trends.

Organised by Viet Nam Television and the ADPEX Joint Stock Company, the exhibition will he held from June 7 to 9 at the Saigon Exhibition and Convention Centre in District 7.