Central-Central Highlands region reports good growth in industry & trade

The industry and trade sector in 15 cities and provinces in the central – Central Highlands region registered a good growth rate that is higher than the national average in the first six months of the year. 

The sector reviewed the performance at a conference in the central province of Thua Thien-Hue on July 12. 

It was reported at the conference that in the first half, industrial production in the region hit 179 trillion VND (7.78 billion USD). Several localities registered high growth, including Gia Lai (up 21.6 percent), Quang Tri (15.7 percent), Thua Thien-Hue (13.5 percent) and Da Nang (11.8 percent). 

The total retail and service revenue reached 312 trillion VND (14.1 billion USD), up 14.4 percent year-on-year, achieving 49.6 percent of the yearly target. 

Vice Chairman of the Thua Thien-Hue provincial People’s Committee Nguyen Van Phuong asked the Ministry of Industry and Trade to help with the development of infrastructure in industrial clusters, especially those regarding waste treatment, as well as provide funding for localities to develop trade in remote, mountainous and island areas. 

Between now and the year-end, the regional industry and trade sector targets achieving 189.1 trillion VND worth of industrial production, bringing the total value this year to 368 trillion VND. 

The total retail and consumption revenue is due to hit 317 trillion VND in the latter half of the year. 

The region aims to earn 3.7 billion USD from exports in order to achieve the year’s target of 7.6 billion USD.

Vietnam’s seaport development potential introduced to Dutch firms

Potential for cooperation in developing transport in general and seaport in particular in Vietnam has been introduced to representatives of the Dutch government and enterprises.

Acting General Director of the Vietnam National Shipping Lines (Vinalines) Nguyen Canh Tinh provided information related to Vietnam’s seaport development plans at a working session in Rotterdam on July 11, on the occasion of Prime Minister Nguyen Xuan Phuc’s recent visit to the Netherlands.

According to Tinh, by the end of 2016, Vietnam built 44 seaports with 219 wharfs, serving over 103,000 ships and nearly 460 million tonnes of goods. The volume of goods handled at the ports is forecast to reach over 1,100 million tonnes by 2030. 

Tinh suggested the Dutch side share its experience in seaport management and operation, and coordinate with Vietnam in attracting goods to and from Rotterdam port through transshipment at Cai Mep – Thi Vai port of Vietnam. 

The two sides should consider the possibility of cooperation in investing in and operating a number of wharfs and logistics areas in Hai Phong port in the northern city of Hai Phong and Van Phong port in the central province of Khanh Hoa, he said. 

Vietnam is calling for investment in the fields of oil and gas; seaport, ship building, and maritime transport, he noted. 

Tinh also briefed participants on seaport projects in Vietnam, including Lach Huyen and Van Phong and Vung Tau ports. 

Earlier, at the Netherlands-Vietnam Business Forum on July 10, a memorandum of understanding on cooperation between Vinalines and the STC Foundation (STC) of the Netherlands in personnel training in seaport and logistics at STC’s training centres in Europe or Vietnam.

VietinBank reviews first-half performance

The Vietnam Bank for Industry and Trade (VietinBank) held a conference in Hanoi on July 12 to review its first-half performance and launch tasks for the remaining months this year. 

Speaking at the event, VietinBank Chairman of the Board of Directors Nguyen Van Thang urged branches to fix existing shortcomings to facilitate business activities. 

In the near future, VietinBank will channel credit into manufacturing in value chain, hi-tech and clean agriculture, start-ups and small and medium-sized enterprises. 

The bank will also pay attention to growth in combination with controlling credit quality by accelerating debt collection in line with the National Assembly’s resolution. 

Le Duc Tho, VietinBank General Director said the bank recorded a total asset of 1,030 trillion VND (44.78 billion USD) at the end of June, up 9 percent from December 31, 2016. 

It raised capital worth 947 trillion VND (41.17 billion USD), marking a 9.7 percent increase from early this year while outstanding loans rose 9.6 percent to 767.8 trillion VND (33.38 billion USD). Pre-tax profit rose 12 percent year-on-year, or 54 percent of the target.

Startup competition promotes sustainable growth

The United Nations Development Programme (UNDP) in Vietnam and HATCH! VENTURES – a social enterprise and startup incubator – announced the “Sustainable Development Goals (SGDs) Challenge 2017” competition in Hanoi on July 12.

Taking place in the capital, Ho Chi Minh City and Da Nang, the contest seeks innovative business ideas that promote sustainability and social changes. 

The final round is set to run in HCM City on October 28, with the winner obtaining a chance to undergo HATCH! VENTURES’s 4-month Acceleration Programme, which prepares startups to be investment ready.

Speaking at the ceremony introducing the contest, UNDP Vietnam Deputy Country Director Akiko Fujii said the UNDP wants to connect with the startup community in Vietnam in a bid to highlight the importance of green growth and create positive social changes.

In 2015, the UNDP and HATCH! VENTURES jointly organised the Hackathon for Social Good, a 48-hour coding contest, which gathered over 100 programmers, developers and social activists to create useful technology products with commercial values for society.

In 2016, the sides signed a memorandum of understanding on partnership agreement with commitments to mobilising young people into innovative actions towards achieving the SDGs.

VN’s OSS mechanism sees massive growth     

As many as 180,079 documents of 12,683 businesses were processed through the national one-stop-shop (OSS) mechanism by the end of June 2017, representing year-on-year rises of 107 per cent and 70 per cent, respectively.

The figures were revealed by the General Department of Viet Nam Customs during the second meeting of the National Steering Committee for National and ASEAN One-Stop-Shop (OSS) Mechanisms and Trade Facilitation (Steering Committee 1899) in Ha Noi on Tuesday, which was chaired by Deputy Prime Minister Vuong Dinh Hue.

According to the General Department of Viet Nam Customs, in the first six months of the year, the Viet Nam Chamber of Commerce and Industry was connected to the OSS mechanism, raising the total number of agencies joining the system to 11.

Meanwhile, three more administrative procedures were added to the system, bringing the total figure to 39.

The department is launching an OSS aviation mechanism and a project to supervise import-export activities through the national OSS mechanism in Hai Phong City and Ha Noi, before expanding to localities accommodating major seaports and airports.

Viet Nam is ready to officially connect to the ASEAN OSS Mechanism as soon as the protocol on legal framework for the system becomes effective.

Currently, nine ASEAN member countries, excluding the Philippines, have approved the protocol.

However, Director of the General Department of Viet Nam Customs Nguyen Van Can said that coordination in building legal documents among ministries remained weak, affecting businesses and agencies implementing online customs procedures through the OSS mechanism at nine international seaports. He pointed to the sluggish amendment to legal documents in managing and supervising exports and imports, along with agencies’ failure to recognise each other’s inspection results.

Addressing the meeting, Deputy PM Hue held that some ministries have yet to actively reform administrative procedures, especially customs examination formalities.

He noted that inspection procedures account for 30-35 per cent of total customs procedures, but the ratio of discovered violations is only 0.04 per cent, while the World Bank recommends that the inspection should make up only 15 per cent of customs procedures and base on risk assessment.

Pointing out that 50 per cent of the total inspection procedures of nine ministries do not have specific standards, the Deputy PM said that the application of different standards has caused difficulties to businesses.

He asked relevant ministries, especially the Ministries of Industry and Trade, Agriculture and Rural Development, and Health, to promptly review and revise overlapping regulations on customs inspection, lowering the ratio of inspection to 15 per cent by 2020.

He urged ministries and sectors to make greater efforts to fulfill the plan to add 130 procedures to the national OSS mechanism in 2017. The Deputy PM also requested ministries and sectors to complete their specific action plans to implement the ASEAN OSS mechanism by August this year. 

Iron ore export tax needed to foster investment     

Because the price of refined iron ore is 200 times more expensive than raw iron ore created for export, reducing the export tax on raw iron ore is unreasonable and will discourage investments in ore sorting technology, the Ministry of Finance (MoF) has concluded.

Due to the decreasing domestic demand for iron ore, domestic iron mines have a surplus inventory. Therefore, the Ministry of Industry and Trade (MoIT) proposed the Prime Minister to allow the export of iron ore inventory, limonite iron and magnetite iron ore to remove difficulties for enterprises.

The exports will last until the end of 2017.

The MoIT also proposed the reduction of export taxes on high quality iron ore, if this product is allowed to be exported.

MoF said that the export tax on iron ore and refined iron ore is 40 per cent – equal to the ceiling rate set by the National Assembly.

In order to encourage enterprises to invest in high-grade iron ore production, the MoF proposed a detailed plan for specific tariff for processed iron ore, with export tariffs lower than 40 per cent.

The high export tax rates on raw or simple mineral resources is to limit the export of mineral resources.

MoF will collect recommendations of MoIT to include in the draft decree amending Decree 122/2016, to submit to the Government in September, 2017.

The total capacity of licensed iron ore mines is about 13 million tonnes per year, reported by the MoIT. Domestic blast furnaces are mostly small in size and large in fuel consumption, leading to inefficient operation. Therefore, they have stopped production or produced moderately.

The efficient blast furnaces have a combined capacity of 2.6 million tonnes of steel per year, using about 4.6 million tonnes of iron ore per year.

Iron ore is mainly exploited in the Northern mountainous areas, with difficult exploitation conditions, high transport costs and low ore quality leading to high production costs.

When the global price of iron ore fell sharply last year, Hoa Phat Steel Joint Stock Company shifted to using import sources with a volume of over one million tonne instead of using domestic iron ore.

Due to decrease in domestic consumption, until the end of November 2016, the amount of iron ore inventory in Viet Nam was about 1.9 million tonnes. 

Quang Ngai attracts projects worth $2.81b in H1     

Dung Quat Economic Zone and industrial zones in Quang Ngai Province attracted eight projects worth US$2.81 billion in the first half of this year, according to the provincial People’s Committee.

To date, there are 140 valid projects in the Dung Quat Economic Zone with total registered capital of $10.31 billion, 90 of which are already put into operation.

Quảng Ngãi is expected to draw $13.5 billion into the Dung Quat Economic Zone by 2020, which would create some 35,000 jobs for the central province.

A report of the People’s Committee at the People’s Council’s three-day meeting, which opened on Tuesday, also showed improvements in the province’s economy.

The province’s Gross Regional Domestic Product (GRDP) rose by 1.25 per cent over the same period last year. The agriculture, forestry and fishery sector jumped by 4.47 per cent and services rose by 7.39 per cent. However, the industry and construction sector saw a decline of 3.43 per cent.

The province saw the foundation of 321 new firms in the first five months of this year with total registered capital of nearly VNĐ11.8 trillion ($517 million), representing a whopping 18-fold increase.

Bui Thị Quynh Van, chairwoman of the provincial People’s Council, said the province during this meeting would discuss policies to improve the business and investment climate, boost entrepreneurship, encourage the development of the private economic sector and develop hi-tech agricultural production.

In 2016, the central province attracted 43 projects, eight of which were foreign-invested.

Rice export target set at 5.7 million tonnes     

The Viet Nam Food Association (VFA) has set the target for rice export at 5.7 million tonnes this year, up 800,000 tonnes from 2016, amid rising global demand.

Huynh The Nang, president of VFA, said that since May, the demand for rice in the global market had seen a significant rise, and sellers now had the upper hand.

The current stockpiles of major rice exporting countries were not high, while rice import demands from countries such as the Philippines, Bangladesh and Indonesia were rising, Nang said, adding that the average export price had seen a rise of US$6-7 per tonne compared to the same period last year.

Nang said the Philippines planned to purchase 250,000 tonnes of rice in July and there was a high possibility that Viet Nam would be chosen. The Philippines was also considering importing another 544,000 tones by the beginning of September.

Recently, Bangladesh and Viet Nam also signed a memorandum of understanding on rice trade, in which Viet Nam can sell up to one million tonnes of rice to Bangladesh every year.

A survey by the Ministry of Agriculture and Rural Development (MARD) revealed that local rice prices were increasing this year, by VND300-600 per kg.

Data from the MARD shows that in the first six months of 2017, rice export reached 2.8 million tonnes worth $1.2 billion, up 6.3 per cent in quantity and 4.9 per cent in value over the same period last year. The increase is considered impressive, given that it declined by 26.5 per cent in volume and 22.4 per cent in value in 2016. 

1Pay receives intermediary payment license     

The State Bank of Viet Nam (SBV) granted a license for 1Pay Joint Stock Company’s intermediary payment services on July 12.

Accordingly, the company will be allowed to expand its activities in electronic payments, collection assistance, electronic money transfer and e-wallet services.

Speaking at the ceremony, Hoang Tuyet Minh, deputy director of SBV’s payment department, said that she expects that 1Pay will provide the best payment solutions to customers, boosting the development of modern non-cash payment solutions in Viet Nam, bringing the country’s e-commerce to an international level.

1Pay will also launch an online payment portal service which allows end users to pay online by bank cards or bank accounts on e-commerce sites and focus on developing and launching e-wallet applications soon, so that users with bank accounts can carry out purchases or pay bills online on smartphones.

Launched in January 2013, 1Pay is an intermediary payment platform provider in Viet Nam, enabling local and international businesses to access and integrate mobile payment services simply and automatically.

1Pay, a fintech startup project of MOG Viet Nam JSC, is now one of the successful open platforms for electronic payment in Việt Nam with more than 3,000 customers from eight different countries. 

Hanwha Life reports 60 per cent growth

Hanwha Life Vietnam has reported almost 60 per cent growth year-on-year in premium income to VND653 billion (US$13.25 million) in the first half of this year.

Back Jong Kook, chairman of the members council and general director of the company, attributed the strong growth to the expansion of the Hanwha’s network across the country and its focus on improving customer service and financial consultancy.

It opened 17 customer service centres in the period, raising the total number to more than 94, and plans to have 100 by the end of this year.

Its parent, Hanwha Group, is among the 10 top conglomerates in South Korea.

Hanwha Group plans to invest in more sectors in Viet Nam, including finance, energy, real estate and office for lease, Back said.

Cam Ranh International Airport Co sold out all 1.45 million shares     

Cam Ranh International Airport Services Joint Stock Company sold out successfully all its 1.45 million shares at an auction on the Ha Noi Stock Exchange (HNX) on Wednesday.

At least 63 investors, including two institutions, bought all the shares at an average price of VND50,245 (US$2.2) per share, 67.5 per cent higher than the initial price of VND30,000.

According to HNX, with 244 participants, it is the second auction with the highest number of investors in the HNX in 2017. The total purchase registration volume reached nearly 11.36 million, 7.8 times higher than the shares auctioned. The highest auction price was VND65,000 per share, 116 per cent higher than the initial price.

The company, which has a charter capital of VND60 million, provides passenger services at Cam Ranh International Airport in Khanh Hoa Province, such as restaurants, catering services, business class room and souvenirs. 

Bảo Việt Life Insurance Corp to open subsidiaries

Bảo Việt Life Insurance Corporation will open five new affiliated companies this month, raising its total number of subsidiaries to 75 in 63 cities and provinces nationwide.

The five companies will be located in Hà Nội, Quảng Ninh and Bình Định.

Bảo Việt General Director Phạm Ngọc Sơn said besides enhancing product quality, human resource training, technology and management, Bảo Việt has also considered the expansion of its network, which is one of its key development strategies.

Bảo Việt Life Corporation has, so far, provided financial plans and protection to more than five million customers with nearly 50 products. The corporation paid nearly US$1.5 billion in benefits to customers.

According to the Ministry of Finance’s Insurance Supervisory and Management Department, Bảo Việt topped the country’s life insurance market share in the first quarter of this year, accounting for 28.7 per cent of the country’s total premium income.

MoF maintains raw iron export tax

Because the price of refined iron ore is 200 times more expensive than raw iron ore created for export, reducing the export tax on raw iron ore is unreasonable and will discourage investments in ore sorting technology, the Ministry of Finance (MoF) has concluded.

Due to the decreasing domestic demand for iron ore, domestic iron mines have a surplus inventory. Therefore, the Ministry of Industry and Trade (MoIT) proposed the Prime Minister to allow the export of iron ore inventory, limonite iron and magnetite iron ore to remove difficulties for enterprises.

The exports will last until the end of 2017.

The MoIT also proposed the reduction of export taxes on high quality iron ore, if this product is allowed to be exported.

MoF said that the export tax on iron ore and refined iron ore is 40 per cent - equal to the ceiling rate set by the National Assembly.

In order to encourage enterprises to invest in high-grade iron ore production, the MoF proposed a detailed plan for specific tariff for processed iron ore, with export tariffs lower than 40 per cent.

The high export tax rates on raw or simple mineral resources is to limit the export of mineral resources.

MoF will collect recommendations of MoIT to include in the draft decree amending Decree 122/2016, to submit to the Government in September, 2017.

The total capacity of licensed iron ore mines is about 13 million tonnes per year, reported by the MoIT. Domestic blast furnaces are mostly small in size and large in fuel consumption, leading to inefficient operation. Therefore, they have stopped production or produced moderately.

The efficient blast furnaces have a combined capacity of 2.6 million tonnes of steel per year, using about 4.6 million tonnes of iron ore per year.

Iron ore is mainly exploited in the Northern mountainous areas, with difficult exploitation conditions, high transport costs and low ore quality leading to high production costs.

When the global price of iron ore fell sharply last year, Hòa Phát Steel Joint Stock Company shifted to using import sources with a volume of over one million tonne instead of using domestic iron ore.

Due to decrease in domestic consumption, until the end of November 2016, the amount of iron ore inventory in Việt Nam was about 1.9 million tonnes.

Traditional markets winning retail battle with supermarkets in Vietnam

Hypermarkets and supermarkets in Vietnam witnessed negative on-year growth of 0.6% in 2016, according to the latest Winning Omnichannel report, an annual publication on fast-moving consumer goods (FMCGs) conducted by research firm Kantar Worldpanel.

Vietnam finished in the top five fastest growing markets in the world for traditional trade.

The big-box shopping format is slowly but surely losing its share, the report said.

Traditional markets accounted for nearly 80% of the total FMCG channel in Vietnam, while hypermarkets and supermarkets checked in with just over 10%.

Vietnam’s trade ministry has projected that by 2020 Vietnam will have 1,300 hypermarkets and supermarkets, and 337 trade centers.

However, the rising number of convenience stores together with a taste for online shopping are overshadowing these modern shopping outlets.

“Vietnamese shoppers prefer to shop at local stores where they have good relationship with the owners or they would love to walk around wet markets or stop by on the street with their motorbikes buying things from street vendors,” Peter Christou, an expert on shopper and retail trends at Kantar Worldpanel told VnExpress International in an email. 

“In order to expand in Vietnam, hyper and supermarkets have to overcome a series of challenges. They have to convince the Vietnamese to change their shopping habits,” he added.

According to Christou, hypermarkets and supermarkets are performing much more strongly this year, but traditional trade will continue to dominate in Vietnam over the next five years.

Vietnam’s upscale hotel market rallying: survey

More Vietnamese travelers are staying at four- and five-star hotels in Vietnam despite the cost, according to a recent survey on upscale hotels and resorts in the country.

The findings were announced on July 11 by accounting and consulting firm Grant Thornton Vietnam in their Hotel Survey 2017 report.

The survey has been done annually by the organization for the last 14 years, providing financial, operational and marketing information on a range of Vietnamese hotels.

Within the scope of the firm’s report, ‘hotel’ refers to both hotels and resorts, with the survey covering four- and five-star properties across a number of major tourist destinations in Vietnam.

According to Kenneth Atkinson, executive chairman of Grant Thornton Vietnam, international travelers have been the dominant source of business for upscale hotels in Vietnam over the past three years.

However, the percentage of foreign guests in Vietnamese hotels dropped from 81.1 percent in 2015 to 79.6 percent in 2016, Atkinson noted.

Domestic tourism has grown to make up 20.4 percent of the surveyed hotels' bookings in 2016, a 2.4-point increase on the previous year.

Looking at annual average room rates by star ranking, four-star hotels went up by 3.8 percent, from an average cost of US$72.30 to around $75.

This rate, however, is still considerably lower than that of 2014, when the average room rate of four-star hotels in Vietnam peaked at an average of $87.20.

On the other hand, five-star hotels became cheaper on average by 6.28 percent, dropping from $111.40 to $104.40 on average.

The rising percentage of Vietnamese who can now afford to stay in luxury hotels demonstrates an improvement in the overall disposable income of the Vietnamese population, according to Tao Van Nghe, chairman of Odyssea Hospitality, which runs the Liberty hotel franchise in Vietnam.

The trend is a positive sign for the hospitality industry in Vietnam, which may need to adopt new marketing strategies to target an emerging group of new customers, Nghe asserted.

The year 2016 also saw a recovery of the hotel and resort business in Vietnam, with average occupancy rates rising from 61.5 percent to 67.2 percent for four-star hotels, and from 62.7 percent to 68 percent for five-star hotels.

Upward trends were observed in both the number of tourists visiting Vietnam and tourism revenue last year, growing at a rate of 26 percent and 18.4 percent respectively.

In 2016, Vietnam welcomed over ten million international travelers.

In the first half of 2017, 6.2 million foreign visitors already arrived in Vietnam, with the country anticipating as many as 11.5 million international tourists by the end of the year.

Navigos: Manufacturing maintains lead in recruitment demand

Manufacturing has continued to lead recruitment demand in Vietnam, according to Navigos Search.

In the second quarter of this year, recruitment demand in the senior and mid-levels in the sector dominated, with 40 per cent of all recruitment demand, Navigos’s report on recruitment demand for senior and mid-level managers, based on recruitment requests from its clients, reveals.

Manufacturing, Industrial Construction, Building Construction, and Electricity/Electronics held the largest proportions.

Consumer Goods/Retail, especially the Apparel/Accessories and Food/Beverage categories, followed, with 17 per cent of demand.

The IT industry held 14 per cent, concentrated on Internet Service categories for companies using technology in transport and real estate, e-payment gateways, and game developers.

Following were Banking - Finance - Insurance, Professional Services (Advertising, Education and others), Healthcare, Hospitality/Travel, and Transport.

Data Technology, meanwhile, will be the fast-growing industry over the next three years, according to Navigos Search.

In particular, FinTech companies, which provide financial services based on technology platforms, have high recruitment demand for IT engineers with experience in the data field and financial knowledge. Such candidates are in short supply in Vietnam, however, and these companies must therefore recruit foreign engineers. To meet recruitment demands, FinTech companies have also accepted recruiting fresh graduates and provide their own training.

A technology expert told Navigos Search that Data Technology would be the fastest-growing industry over the next three years. Companies in the industry have high recruitment demand for IT engineers in Data Processing and IT engineers with experience in machine learning, part of the artificial intelligence field and related to technical research and development that allows automated learning from database sources for problem solving.

Vietnam has few professional training universities in this field. Companies providing online products and services therefore have high recruitment demand on such positions but suitable candidates are limited in number.

The report was released by Navigos Search, the leading provider of executive search services in Vietnam and a member of Navigos Group, in Ho Chi Minh City on July 12 and includes highlights on recruitment trends.

Navigos Search, the market leader in providing senior and mid-level management recruitment services, and VietnamWorks, Vietnam’s largest and oldest online recruitment portal, both belong to Navigos Group Vietnam.

Navigos Group has just celebrated its 15th anniversary in the country.

HBC picks up several large projects

The Hoa Binh Construction Group Joint Stock Company (HBC) has secured several major projects worth a total of VND2 trillion ($87.98 million).

It has been entrusted with six new large-scale projects with a total contract value of VND2.075 billion ($91.27 million).

Keppel Land Group has assigned HBC as the general contractor for structures, electricity, and landscape construction at The Riviera Point Phase 2 in District 7, Ho Chi Minh City, with three towers and 518 apartments.

The project is required to build to Green Mark Gold (750 points / 1000 points) standards to ensure safety and environmental sanitation. The total value of the contract is VND1.08 trillion ($47.5 million) and completion is expected within two years.

The Hanoi Real-Estate Business and Services Joint Stock Company under the BRG Group has assigned HBC as the main contractor for the Oriental Garden mixed office and residential complex in Hanoi worth more than VND400 billion ($17.59 million). The 35-story complex is expected to be completed in the second quarter of 2018.

The Cua Duong Star Joint Stock Company under the MIK Group has engaged HBC to build the condotel section of Zone A at the Movenpick Resort and the basic completion of the resort, in a contract valued at VND191 billion ($8.4 million).

The Starbay Vietnam Joint Stock Company under the MIK Group has assigned HBC to build the foundations and structure of Crowne Plaza at Bai Dai Resort on Phu Quoc Island in a contract worth VND174 billion ($7.65 million).

In addition, the Vietnam Land SSG Limited Company signed on with HBC in a package for a tunnel for the Opal Tower project in Ho Chi Minh City. The project is valued at over VND136 billion (5.98 million) and officially began on July 5.

HBC also won a package on electrical engineering with Vingroup for the Vincom Quang Binh project. The total value of the package is VND90 billion ($3.95 million). It has been reported that HBC won the project contract with a total value of VND10.44 trillion ($459.26 million) at the beginning of this year.

Savills: HCMC Q2 apartment transactions highest since 2011

Four new projects and the next phase of seven active projects were launched, providing over 4,700 units, while available apartments across all grades were down 12 per cent quarter-on-quarter and 7 per cent year-on-year at around 37,200 units, according to the Savills’ Q2 report on the Ho Chi Minh City real estate market.

Sales growth rose 33 per cent quarter-on-quarter and 67 per cent year-on-year, with the approximately 11,600 transactions being the highest since 2011.

Impressive Grade B and C performance increased 10 ppts quarter-on-quarter and 13 ppts year-on-year, with 31 per cent absorption. Grade C saw the highest absorption, at 37 per cent, and accounted for 64 per cent of sales.

From the third quarter of this year to 2018, approximately 48,000 units are expected to be launched. Grade C is expected to see the highest proportion, with approximately 46 per cent.

In the townhouse and villa segments, one new project and new phases of seven existing projects provided approximately 390 dwellings. Primary stock was down 20 per cent quarter-on-quarter and 35 per cent year-on-year, to around 2,060 dwellings.

Total villa/townhouse transactions fell 14 per cent quarter-on-quarter and 6 per cent year-on-year. The absorption rate, due to limited new supply, was 37 per cent, up 3 ppts quarter-on-quarter and 11 ppts year-on-year. Townhouses continue to dominate the market with 85 per cent of sales.

In the land plot segment, District 9 continued to lead, accounting for 43 per cent of total sales. Land plots of 50-80 sq m were the most popular.

Stock from the second half of this year to 2019 will be approximately 11,500 dwellings and plots from 33 projects. Eastern districts, with more than 50 per cent of future supply, are expected to lead the market.

First district-level hospital to build examination facility under PPP model

The District 2 Hospital will be the first district-level hospital in Ho Chi Minh City to build a high-tech examination and treatment facility under the model of public private partnership (PPP).

An agreement to this effect was signed between District 2 Hospital and the Ho Chi Minh City Finance and Investment State-owned Company (HFIC) and Y Dao Medical Service Consulting Investment Corporation on July 12.

Director of the District 2 Hospital Tran Van Khanh said that the examination and treatment facility is scheduled to commence construction in late 2017 and will begin operation in early 2019.

The building will cost approximately VND320 billion (US$14.08 million) and will include nine storeys with a capacity of 100 beds.

Under the PPP project, the investors will invest in the building infrastructure and the purchase of medical equipment. Meanwhile, the District 2 Hospital will prepare personnel and carry out professional partnerships with major hospitals and medical schools to provide examination and treatment services for the public and will share the profits with the investor.

The new treatment facility will be equipped with modern diagnostic equipment such as a new generation, magnetic resonance imaging system to early and accurately detect cardiovascular, spinal and intra-abdominal diseases.

It also has a digital subtraction angiography (DSA) system for the diagnosis and intervention of coronary artery, treatment of cerebral emboli and TOCE procedures for the treatment of liver cancer, among others.

Khanh said that the project is expected to ease the overload at the District 2 Hospital and central-level hospitals and provide high-quality medical services for the public with reasonable prices. 

Prices for examinations will be 30-35% lower than other hospitals of the same kind in the city, Khanh noted.

HFIC Deputy Director Dang Ngoc Thanh said that public private partnership is very necessary to the health sector, as it is beneficial to hospitals to be equipped with modern medical equipment in order to meet the higher demand of the public while contributing to reducing overload at central-level hospitals.

Motorcycle sales pick up 6% in H1

Motorcycle sales in the first half of this year grew 6% compared to the same period last year to 1.52 million units, according to a Vietnam Association of Motorcycle Manufacturers (VAMM) report.

Five VAMM members – Honda, Piaggio, Suzuki, SYM and Yamaha Motor – sold around 255,000 units a month, up by 15,000 units year-on-year.

According to industry observers, the sales result is surprising as the domestic motorcycle market had been forecast to stay flat or edge down. Motorcycle sales dipped in 2011-2013, with 2.79 million units finding buyers in 2013, down from 3.11 million units in 2012.

The association said 2015 saw signs of recovery on the local bike market, and consumption reached 2.84 million units, up a mere 4% over 2014. Over 3.12 million motorcycles were delivered to customers last year, a 9.5% increase against the previous year.

Manufacturers said sales of scooters have been higher than those of underbones. For instance, scooters accounted for more than 45% of total bike sales last year. 

VAMM chairman Yano Takeshi said scooters held a local market share of over 45% and that the segment would enjoy strong sales growth in the coming time given rising incomes of local consumers.

The domestic motorcycle market, the association said, is expected to enjoy sustained growth, as scooters and sports motorcycles have gained increasingly popularity among local customers.

Vietnam to send first chicken shipment to Japan

Koyu & Unitek Co Ltd, an Australian-Japanese joint venture in Dong Nai Province, will start exporting 300 tons of processed chicken products a month to Japan in August, Vietnam Plus reports.

The first shipment of Vietnamese chicken products to Japan, which imports 900,000 tons of chicken a year, may pave the way for domestic poultry enterprises to enter this choosy market. Japan has stringent hygiene and safety requirements for chicken products.

Koyu & Unitek has spent three years preparing for exporting chicken products to Japan.

The firm has imported 42,000 breeder chickens from France, and they produce half a million chicks a month, which are raised at two associated farms and slaughtered when they weigh 2.2 kg.

Koyu & Unitek also invested US$6.5 million in a poultry processing plant with a capacity of 50,000 chickens a day. Prices of chicken products shipped to Japan will be 30% higher than local levels.

FPT Software, Arago team up to develop AI solutions

FPT Software, a leading software and technology company in Vietnam, has said that it and Arago GmbH, a pioneer in artificial intelligence (AI) and leader in intelligent automation, have entered into a strategic global partnership.

The two sides will jointly develop outstanding AI-based solutions to meet the challenges of the digital transformation and integrate intelligent automation solutions for FPT Software customers in the field of Industry 4.0, IoT, Mobility, Cloud, Q&A Testing, Legacy Migration, Application and BPO Services.

Meanwhile, Arago will get FPT Software’s backing for its “Scaling-UP” strategy for global expansion by gaining access to highly experienced and globally active service and technology experts which will serve Arago’s customers as system integration (SI) partners worldwide.

The two firms will launch their first joint service offerings in the U.S. by integrating Arago’s AI platform HIRO into FPT’s IT services and automation portfolio, thus allowing customers to benefit from higher automation rates, proactive and autonomous IT management, cost saving potential and knowledge retention capabilities, and increased speed and agility.

Alfred Ermer, Chief Operating Officer of Arago, said in a statement, “FPT is one of the most agile partners in the IT services industry. We are excited to support FPT’s global delivery centers by bringing maximum value to their clients through the integration of our AI platform HIRO into their service offerings. We are also equally very happy to leverage FPT’s global delivery expertise and talent pool for rapid expansion.

“Our partnership with FPT will address the challenges established enterprises are facing on July 12 by providing a powerful tool they need, to not only survive, but thrive in the digital age.”

Arago’s AI platform HIRO autonomously manages and automates every process within a company, integrating machine reasoning and machine learning.

FPT has presented its own beta cognitive platform, FPT AI, which is the first in Vietnam to specialize in automated interaction. Its project is free for all interested in chatbot (automated response technology) and speech technology. FPT will also aim for AI development and deployment domestically and internationally.

HCMC asked to propose tax debt write-offs

Deputy Minister of Finance Do Hoang Anh Tuan has asked HCMC to petition the National Assembly (NA) to write off the tax debts owed by long-disbanded enterprises.

At a mid-year review conference of the HCMC Tax Department last week, Tuan said the ministry had asked for removal of these debts but had come under criticism.

He said a staggering VND22 trillion (US$967 million) in taxes had not been paid as of June 30, with around VND10 trillion from operational production and business activities, and the remainder from those having already gone bankrupt or been dissolved in 2006-2007, when interest rates shot up to 18-20% a year.

This means VND12 trillion in tax debt is uncollectible. “HCMC can ask the National Assembly to write off this debt,” Tuan said at the conference, which was also attended by HCMC vice chairman Tran Vinh Tuyen.

Tran Ngoc Tam, director of the city’s Tax Department, said the department has faced great difficulties in collecting the tax arrears from the disbanded firms as they are nowhere to be found. The longer the tax debt is kept there, the higher the fines for tax payment delays will be, he noted, but in fact they cannot be collected.

Tuan said his ministry and the General Department of Taxation had more than once proposed writing off tax debts owed by certain enterprises.

In August last year, the ministry suggested the Government write off nearly VND8 trillion in tax debts owed by enterprises that had gone bust by early 2014, and freeze another VND6.7 trillion, also owed by such business entities.

Earlier the ministry also proposed writing off tax debts owed by State-owned enterprises that had gone public or been restructured. However, Tuan said, the two proposals came under heavy criticism.

Data of the HCMC Tax Department shows collectible tax debts had totaled VND9.9 trillion as of June 30, down about VND1 trillion from VND10.9 trillion late last year.

The department sent around 1.2 million notices about tax arrears and fines worth VND31.8 trillion to local enterprises, and deducted VND3.6 trillion from their banking accounts.

Bac Giang litchi price surges to 63-year high

The price of litchi grown in the northern province of Bac Giang has shot up to a 63-year high of VND70,000-80,000 per kg, compared to last year’s peak of VND40,000, said Tran Quang Tan, director of Bac Giang Province’s Department of Industry and Trade.

More than 80,000 tons of Bac Giang litchi output of 100,000 tons has been consumed. About 55,500 tons has been sold domestically while the rest has gone to China, Australia, the U.S., Dubai, the Netherlands and Thailand. China has remained the major importer with more than 25,000 tons, while Australia, Thailand and Dubai have for the first time imported Vietnamese litchi this year.

In spite of the poor litchi crop, which has seen a decline of more than 50,000 tons, the high price has compensated this output fall. This year sales revenue is estimated at VND5 trillion, unchanged from the previous year, Tan said. The Bac Giang litchi season lasts until mid-July.

“There are still 200 trucks and 23 Chinese traders waiting in Bac Giang for the last round of harvest,” Tan said, adding the average litchi price on Monday ranged from VND18,000 to VND40,000 per kg.

VNA/VNS/VOV/SGT/SGGP/TT/TN/Dantri/VNEVET