Hanoi hosts VietAd and VPSE 2017

The 8th Việt Nam International Advertising Equipment and Technology Exhibition (VietAd), the premier event of the country’s advertising industry, opened on Wednesday at the Hà Nội International Exhibition Centre. This year it is being held for the first time in conjunction with the Việt Nam International Packing and Label Printing Exhibition (VPSE).

The three-day event includes 180 booths, featuring the latest products and technologies in ultraviolet printing (UV flat, UV coil), thermal transfer printing, bending technology, LED advertising, automatic stamp and number, motion cutting technology for digital products and other new technologies, the organiser said.

The events are organised by Đông Nam Advertising and Commercial Promotion JSC, under the auspices of the Việt Nam Advertising Association (VAA). They are designed to provide opportunities for firms to exchange experiences and open up co-operation opportunities in the advertising industry.

Nguyễn Thanh Đảo, general director of Đông Nam JSC, said that VietAd had become one of the most important events for Việt Nam’s advertising industry after eight years of development. It has been held annually since 2010 and expanded to meet the requirements of enterprises and the advertising market in the North.

Holding VietAd with VPSE is designed to create an effective trade channel for enterprises supplying machinery, materials, equipment and services for packing and label printing. The exhibition is an opportunity to foster the development of the country’s advertising industry which currently imports most of the required machinery and equipment, Đảo added.

Financial Ministry rejects taxi association's call to slash VAT

Vietnam’s finance ministry has turned down a request made by local taxi companies to lower taxes to form a fair and competitive environment in the ride services market.

The Taxi Association of Ho Chi Minh City had previously sent a proposal to the ministry asking for its VAT duty to be slashed from 10% to 5% so that traditional taxis can compete with foreign ride-hailing services like Uber and Grab, which are subject to a 3% rate.

In response to the taxi association, the finance ministry claimed that it is following a tax reform plan which will gradually apply a 10% VAT fee on nearly all types of goods and services by 2020. 

Only essential goods will be subject to the lower rate of 5%, while exports will be exempt from this duty.

The finance ministry's decision comes at a time when Vietnam is facing declining tax revenue in the wake of a dozen free trade agreements. The government has also come under pressure to deal with growing public debt, estimated at 64.73% of the country's gross domestic product at the end of 2016, and close to the 65% ceiling set by legislators. 

In terms of the alleged higher taxes and fees traditional cabs have to pay, the ministry said that this conclusion is totally “without foundation”.

They cited figures showing that most major taxi firms in Ho Chi Minh City are paying corporate income tax rates of 0.01-0.06%, and some are even receiving rebates. Meanwhile, a 2% rate is currently applicable to mobile ride-hailing services.

Uber and Grab entered the Vietnamese market three years ago to provide transportation services via mobile apps.

Grab, a Malaysian-based company, is the only foreign-run transport service allowed to operate in five cities across Vietnam using registered private vehicles between 2016 and 2018.

Uber, however, has been singled out for providing ride-hailing services without legal permission.

The growing popularity of the two services has led to a fall in profits for traditional cabs, by at least 10% last year in Ho Chi Minh City, according to the association.

Reference exchange rate stays flat for third day

The State Bank of Vietnam kept the daily reference exchange rate at 22,262VND per USD for the third consecutive day on March 15.

With the current trading band of +/-3 percent, the ceiling rate for commercial bank is 22,930 VND and the floor rate 21,594 VND per USD.

The opening hour rates at commercial banks saw slight fluctuations. 

Vietcombank listed its rates at 22,785 VND (buying) and 22,855 VND per USD, both up 15 VND from the day before. 

BIDV also raised both rates by 20 VND, to 22,785 VND (buying) and 22,855 VND per USD.

Meanwhile, the buying rate at Techcombank was up by 10 VND to 22,760 VND and selling rate was kept unchanged from the day before at 22,850 VND per USD.

Blue chips drive market, but volatility looms

Shares advanced steadily on March 14 on the HCM Stock Exchange, boosted by strong large-cap stock growth. However, analysts have warned about volatility ahead of the US Federal Reserve’s next meeting.

The benchmark VN-Index edged up 0.64 percent to close at 714.71 points. The southern market index decreased 0.3 percent on March 13.

Six of the top 10 biggest stocks by market value gained, including brewery giant Sabeco (SAB), dairy firm Vinamilk (VNM), PV Gas (GAS), FLC Faros Construction (ROS), private equity Masan Group (MSN) and real estate developer Novaland Investment Group (NVL).

The listing value of these six stocks accounted for over 36 percent of the HCM City exchange’s total market value.

Money also flowed into realty stocks. The top five most heavily-traded codes on the southern exchange were real estate firms: They were FLC Group (FLC), Hoang Quan Consulting Trading Service Real Estate (HQC), FLC Faros Construction (ROS), Hoa Binh Construction (HBC) and Duc Long Gia Lai Group (DLG).

FLC was the most active with over 17 million shares traded and an increase of 0.3 percent. Others saw 4-7 million shares exchanged on each stock.

Despite positive movements on March 14, stock analysts have warned about an uncertainty.

“In the short-term, the market is unlikely able to move beyond this range, as there are many upcoming factors that could affect trade, such as the Fed’s meeting result, falling oil prices or portfolio review of exchange-traded funds,” analysts at MB Securities Co wrote in a note.

Investor caution could weaken liquidity and make it difficult for investors to identify market trends, they said.

The Fed will hold a meeting on March 16 night, and the result of the two-day meeting will be revealed on Thursday morning in Vietnamese local time. The positive report on the US unemployment rate has strengthened forecast for an interest rate rise.

The Fed’s decision may have a negative impact on emerging and frontier markets including Vietnam in terms of foreign withdrawal and forex movements.

On the Hanoi Stock Exchange, the HNX-Index inched up 0.2 percent to close at 87.2 points. The northern market index slumped 1.3 percent on March 13. 

Overall liquidity decreased with 179 million shares worth a combined 3.7 trillion VND (163 million USD) traded on the two exchanges, down 6.3 percent in volume and 7 percent in value compared to March 13’s figures.

Binh Dinh aims to lure 5.5 million visitors in 2020

The south central province of Binh Dinh aims to serve 5.5 million visitors in 2020 to earn 10 trillion VND (450 million USD), said Vice Chairman of the provincial People’s Committee Nguyen Tuan Thanh.

In 2017, the province hopes to attract 3.55 million visitors and earn tourism revenue of 1.62 trillion VND (71 million USD), he said.

Thanh also revealed that along with destinations that are already planned, the province will make tourism planning to 2020 with a vision to 2030 for localities in the north of the province, including Hoai Nhon, Phu My, Hoai An and An Lao districts, focusing on promoting beaches, spiritual and historical tourism sites.

Thanh said that the four northern districts of Binh Dinh boast high potential for tourism development, as they have diverse terrain including sea, rivers, lagoons and mountains.

Meanwhile, Nguyen Van Dung, Director of the provincial Department of Tourism, said that the province will review its tourism planning for suitable investment.

At the same time, the province will improve its infrastructure and transportation connectivity, while strengthening land management and growing tourism through mobilising investment.

Binh Dinh will develop four major tourism products, including beaches and resorts, culture and festivals, ecotourism and trade villages, he said

The province will connect tours in each district and destinations of the four districts, while striving to promote one destination linked with local tours inside and outside the district in 2017.

The localities have also been asked to strengthen communications on tourism, while enhancing State management in the field.

Vietnam promotes trade in New Zealand

Representatives from dozens of New Zealand firms doing business in Vietnam have met with the Vietnamese Embassy’s trade official in Hamilton, Waikato to learn more about Vietnam’s business and investment environment.

The event was jointly organised by the Trade Office under the Embassy of Vietnam in New Zealand, the Voice of New Zealand Exporters (ExportNZ) in Waikato, and the ASEAN – New Zealand Businesses Council (ANZBC).

Commercial Counselor Nguyen Kim Phuong briefed the participants on Vietnam’s recent economic development, business climate, and assistance provided by her office.

Meanwhile, ExportNZ and ANZBC informed them about their support for businesses doing business in the ASEAN and Vietnam markets, and their plan to send a delegation of 15 – 20 members to explore Vietnam’s market in 2017.

Other investors in Vietnam also shared their experience in doing business in Vietnam.

Waikato is the fourth biggest region of New Zealand with 2.5 million hectares. Its major export lines are milk, meat, farmed fish, forestry and wood products, farm products, among others.

Vietnam participates in Global Entrepreneurship Congress

A Vietnamese delegation led by Deputy Minister of Science and Technology Tran Van Tung is taking part in the Global Entrepreneurship Congress 2017 (GEC 2017), which opened in Johannesburg, South Africa on March 14.

The event attracts more than 1,500 delegates who are entrepreneurs, researchers, and policy makers from over 100 countries.

South African Vice President Cyril Ramaphosa said entrepreneurship, especially by young firms, is a right direction amid the world’s current economic situation, particularly in Asia and Africa.

The congress, which will last through March 17, opens up new opportunities for regional and global businesses to enhance experience sharing, seek investment opportunities and boost cooperation. It will provide favourable conditions for participants to get connected, collect information, learn about new initiatives, and continue business ideas, he said.

Organisers said at the GEC 2017, participants can attend plenary sessions on policy making, new initiatives and development cooperation opportunities. They can also participate in discussions about start-up and business or gain an insight into projects and new business chances in the world and different regions or in a certain country they are interested in.

The event also features an exhibition on successful start-ups, big economic projects to be implemented around the globe, and activities of outstanding small- and medium-sized firms.

Reference exchange rate stays flat for third day

The State Bank of Vietnam kept the daily reference exchange rate at 22,262VND per USD for the third consecutive day on March 15.

With the current trading band of +/-3 percent, the ceiling rate for commercial bank is 22,930 VND and the floor rate 21,594 VND per USD.

The opening hour rates at commercial banks saw slight fluctuations. 

Vietcombank listed its rates at 22,785 VND (buying) and 22,855 VND per USD, both up 15 VND from the day before. 

BIDV also raised both rates by 20 VND, to 22,785 VND (buying) and 22,855 VND per USD.

Meanwhile, the buying rate at Techcombank was up by 10 VND to 22,760 VND and selling rate was kept unchanged from the day before at 22,850 VND per USD.  

Can Tho wants to work with Canada in hi-tech agriculture

Secretary of the Can Tho city Party Committee Tran Quoc Trung has called on Canadian firms to invest in hi-tech agriculture in the city.

He met with Canadian Ambassador to Vietnam Ping Kitnikone on March 14, saying the city is working on the planning of three hi-tech agricultural production areas for submission to the Government for approval.

Hi-tech agriculture will help the city improve the quality and value of its agricultural exports while bettering its adaptation to increasing climate change impacts, such as salt water intrusion, landslides and fresh water shortages in the Mekong Delta region, Trung added.

He also expressed his hope that Canadian firms will explore investment opportunities in manufacturing farming machines given the city is the nation’s biggest hub of producing and exporting farm products.

The city also wants to join hands with Canadian companies to develop high added-value export product chains and in information and communication technology, and education and training.

Addressing the event, the Ambassador said in 2016, the bilateral trade value between the two nations hit 5 billion USD, of which a majority of goods shipped from Vietnam to Canada is agricultural and fishery products.

The two nations also shared a similar economic structure, with more focus on small and medium-sized enterprises than large-scale factories, she said, adding that Canadian investors’ overseas investments help create high added-value and establish win-win value chains.

Canadian wants to explore further the city’s hi-tech agriculture potential to expand their market and products. The country wants to connect with multiple nations in the Asian – Pacific region, the diplomat noted.

Supporting centre for youth’s startup makes debut

The Vietnam Youth Union (VYU) Central Committee on March 14 launched its Supporting Centre for Youth’s Startup, which is hoped to foster startup activities among young people. 

Speaking at the event, First Secretary of the Ho Chi Minh Communist Youth Union (HCYU) Central Committee Le Quoc Phong, who is also President of the Vietnamese Students Association, highlighted the significance of the centre’s formation, expressing his belief that the centre will promote support for youths’ startup in the future. 

He expected that through the centre, youths nationwide will have opportunities to learn experience and receive assistance from entrepreneurs for their startup plans. 

The centre will provide advice and support, and connect youths’ ideas for setting up shop, focusing on managing investment capital and loans of the VYU and HCYU Central Committees, and cooperating with ministries, sectors and organisations in implementing ideas related to startup and creativeness of young people. 

It will also act a bridge to connect youths with enterprises and organisations, which will help them develop business ideas. 

Earlier the same day, the VYU Central Committee  and UBer BV Company signed an agreement  on cooperation in organising the programme UberEXCHANGE - Smart startup, which aims to provide information and experience concerning management, law, communications, policy-making, and product development, for startup businesses of Vietnamese youths.

Uber links up with youth federation to help startups

Ride-hailing firm Uber sealed a cooperation deal on March 14 with the Vietnam Youth Federation (VYF) to mentor start-ups.

The agreement is part of Uber’s start-up initiative in Vietnam called UberExchange.

UberExchange is part of Uber’s mission to create a startup ecosystem with the VYF. All start-ups across the country are encouraged to apply for the programme through an online application process and global leaders at Uber will provide mentorship sessions from April to August 2017 with selected start-ups.

The sessions will culminate in a finale with Uber short-listing 10 start-ups who will present their business ideas. The startup with the most impressive presentation will be flown to San Francisco to meet Uber’s senior leadership and potential investors.

Addressing the event, Deputy Minister of Planning and Investment Dang Huy Dong said Vietnam has a large number of young people who have passion, creativity, and good IT background.

He noted that startups will be one of the drivers of economic development and the State has adopted many policies and created a legal framework for the building of a startup ecosystem.

“Uber’s goal is to stand side by side with the Vietnamese entrepreneurs on the way to start their new business, helping them open their minds, as well as develop strategies for entrepreneurship, contributing to making Vietnam become a regional start-up hub,” said Mike Brown, Uber regional general manager for Asia-Pacific.

“Vietnam is a young country with many great young minds and an incredible focus and passion for education and innovation. Our goal is to help the young people to achieve their dreams. The way that people measure our success on this programme is by the number of young startups that we can assist and support,” Brown said.

President of the VVYF Nguyen Phi Long expressed belief that UberExchange will be an effective platform for Vietnamese youths and businesses to learn and share experiences, build a culture of entrepreneurship with practicality and creativity, encourage creative thinking, which acts as a springboard for a strong and sustainable development of Vietnam in the future.

Vietnam is the second country in the world and the first in Southeast Asia that Uber introduced the UberExchange programme. The first country Uber launched the initiative in was India.     

Vietnamese, Japanese localities boost links in clean agriculture

Representatives from the People’s Committee of the Mekong delta province of Soc Trang and those from Japan’s Hiroshima prefecture have agreed to enhance cooperation in many fields, especially in clean agriculture and the environment, which began in 2014.

At their working session in Soc Trang on March 14, Vice Chairman of the provincial People’s Committee Le Van Hieu said Soc Trang wishes to expand link and sign cooperation with Hiroshima in high-tech agriculture, the manufacturing industry, and preserving and processing technologies for aquatic products. 

He suggested Hiroshima further cooperate with and support Soc Trang in treating wastewater produced by shrimp breeding as the locality has high demand for products and technologies for the work in order to prevent the discharge of wastewater into the environment. 

According to Hieu, Soc Trang boasts over 45,000 ha of shrimp farming area, and the many breeders are still discharging untreated wastewater into the environment. 

Soc Trang has about 200-300 ha for agricultural development, Hieu said, adding that the local authorities want to cooperate with Hiroshima’s businesses to build a model producing high-quality rice, towards making it easier for local farmers to sell their products. 

Participants expressed the hope that the two sides will maintain effective cooperation to bring development to enterprises and people of the two localities.

Yoshio Sato from the Hiroshima Department of Foreign Business took the occasion to invite officials of Soc Trang to visit a number of Japanese enterprises, which specialise in the environment, in Hiroshima in this June.

He said he hopes Hiroshima will continue coordinating with Soc Trang, Can Tho city and the Steering Committee for the Southwest region to organise a seminar to promote trade connections between the two sides’ enterprises in this September.

Soc Trang and Hiroshima established cooperative ties in 2014, focusing on the fields of environment and clean agriculture.  

Emerson Network Power rebrands as Vertiv in Vietnam

Vertiv, formerly Emerson Network Power, on March 14 officially launched under its new branding in Vietnam, aggressively expanding into key local industries.

Vertiv is the new name, but the company is still an established global industry leader. It’s a trusted partner for the operators in data centres, communication networks and commercial and industrial facilities, and one with newfound speed, focus and flexibility as a standalone company.

With offices in both Hanoi and Ho Chi Minh cities, Vertiv in Vietnam will build on the broad portfolio of product and service offerings for power, thermal and IT management capabilities it previously offered  as Emerson Network Power, including its industry-leading  flagship brands ASCO, Chloride, Liebert, NetSure and Trellis. 

This follows the global campaign to rebrand Vertiv as a standalone company after completing the sale to Platinum Equity. 

Truong Quang Dzung, country manager of Vertiv in Vietnam, said that the company will be aggressively expanding into the telecommunications, banking, healthcare and transportation industries.

“We are seeing strong demand for our products, solutions and services from these industries,” he said, “In the telecommunications industry, for example, local operators are now aggressively increasing their bandwidth and coverage on fixed-line broadband and mobile networks, as well as 4G technologies.” 

“Digital transformation is also taking place in the banking and healthcare industries with the increasing deployment of e-services. For many years, Vertiv has been the preferred provider of robust and reliable infrastructure not just in telecom networks, but also in data centres in these industries,” he added.

In addition, Vietnam is also seeing growth in the manufacturing sector, as the country eyes to become a global manufacturing hub. 

Apart from its industry leading power, thermal and infrastructure management solutions, Vertiv also has its turnkey data centres, which combine power, thermal and monitoring in a rapidly deployable solution that is more cost effective and efficient than traditional data centre builds. 

“We are excited to be Vertiv and we will continue to work closely with our customers and partners in enabling Vietnam’s digital transformation initiatives,” added Dzung. 

“Vietnam is a key market for us here in Asia. As Vertiv, we will continue to build on the unmatched legacy and strong foundation we’ve established over the years. We are committed to helping our customers achieve their goals and enable their digital strategies,” Paul Churchill, vice president of Southeast Asia sales at Vertiv, said of the rebrand.

Vietnam's top fuel distributor Petrolimex seeks domestic listing

Petrolimex, Vietnam's largest fuel importer and distributor, has sought permission to list all its shares on the Ho Chi Minh Stock Exchange, the government said, nearly six years after its initial public offering.

The Hanoi-based firm, fully known as the Vietnam National Petroleum Group, has sought to list all the 1.29 billion shares, representing its registered capital of VND12.94 trillion (US$568 million), the Industry and Trade Ministry said in a statement.

Petrolimex submitted its listing application on March 10, the exchange said but gave no dates for the debut.

Earlier this month Petrolimex Chairman Bui Ngoc Bao told Reuters the firm expected to debut around April 10-12, while it has yet to set the starting price for the stock.

At its IPO in late July 2011, Petrolimex raised US$20 million via selling nearly 27.43 million shares, or 2.56% of the company, valuing itself at around US$780 million. 

Last year, Japan's JX Nippon Oil & Energy bought 8% of stake in Petrolimex for $178 million, making it the strategic investor in the Vietnamese firm and raising the firm's value to US$2.23 billion. 

The government still owns a majority of shares in Petrolimex.

Vietnam separates IPOs and stock debuts as two processes. Investors' interest has waned in many major firms because they have largely avoided a government requirement to list within one year of their partial-privatization, which Hanoi describes as "equitization".

Last October the government urged privatized state-owned enterprises to speed up share listing, signalling effort to address investors' complaints over the slow process and to increase corporate transparency.

With a nationwide sale network, Petrolimex owns half of Vietnam's market for distributing oil products. It also deals with insurance and invests in producing equipment for the energy sector.

Last year Petrolimex bagged VND5.17 trillion in its net profit, a jump of 49% from 2015, based on the firm's financial report.

Petrolimex has projected a gross profit growth of 10% this year, the industry ministry's statement said.

Long road ahead for entrepreneurs

It will take another five to 15 years for Vietnamese entrepreneurs to become global business leaders, according to a study by the Human Capital Leadership Institute.

The study, “Leadership Mosaics across Asia,” sought to discover the different ways of leadership in Asia based on the in-depth conversational interviews with 165 top executives in nine countries -- China, India, Indonesia, Japan, Malaysia, the Philippines, Singapore, Thailand, and Vietnam.

It found that while Vietnam’s business leaders are able and adept at dealing with situations of volatility, their general lack of exposure to other cultures and approaches hampers their potential for global leadership.

Speaking at a panel discussion in HCM City last week, Su-Yen Wong, HCLI’s CEO, said there are four very important factors in assessing the readiness of emerging Vietnamese leaders to become global leaders.

The first is being able to deal with complexity because regional and global roles are much more complex and ambiguous.

The second factor is the ability to build relationships across external and internal organisational boundaries.

The third factor is the ability to adapt.

“When you take on a regional or global role, regardless of where you are, you need to work with different types of people, with different styles, different assumptions, different histories; so you need to be able to adapt cross-culturally.”

The fourth factor in becoming a regional and global leader is the personal aspiration to move across borders.

Talking of the advantages Vietnamese business leaders possess, she said “One of the aspects that Vietnamese leaders do very well based on our research is the ability to drive complexity. This is something that Vietnamese leaders should focus on leveraging as they go into other markets to expand their businesses.”

Tieu Yen Trinh, CEO of Talentnet, said there has been a good evolution of high-level human resources in the past five years, with an increase in the number of Vietnamese taking up high positions in large foreign companies in Vietnam.

But Vietnamese need some more time to accumulate experience to take on regional and global roles, she said.

To become global business leaders, the first step is recognising the importance of being global, having global experience and developing a global mindset, Su-Yen said.

The second is being open to various kinds of experiences, which could be relocation or working on regional projects, and this can help learn how to become adaptable, she said.

Pham Hong Hai, CEO of HSBC Vietnam, saying leaders need to be positive and persistent with their vision and purpose, called on Vietnamese to connect and support each other to go global.

Attendees said as Vietnam continues to integrate globally, it is imperative that its senior business leaders prioritise corporate governance, professional management, employee up-skilling and scaling up their business effectively.

Praneeth Yendamuri, managing director of Kimberly-Clark Vietnam and Indochina, said while it may be some time before Vietnamese global leaders emerge and achieve critical mass, senior executives should focus on leadership development and take accountability for building the next level of leaders.

Trinh said Vietnamese are very talented, intelligent, hardworking and willing to learn.

Young Vietnamese leaders should strengthen their regional and global networks and visit other countries to be more confident about connecting with the world, she said.

BIDV offers VND10 trillion loan for high-tech agriculture     

The Bank for Investment and Development of Viet Nam (BIDV) will offer preferential loans up to a total of VND10 trillion (US$439 million) this year to support high-tech agricultural businesses.

Customers can choose from different loan packages, with the interest rate of 6.5 per cent per annum for loans less than 12 months and 7.5 per cent for more than 13 months.

Companies and agricultural production establishments will be given loans to invest in agricultural machines and equipment, expand production scale, buy fertilisers and spend on irrigation, harvesting and plant protection products.

The development of hi-tech agriculture is considered as one of the Government’s key agendas.

Last month, Prime Minister Nguyen Xuan Phuc asked the State Bank of Viet Nam (SBV) to increase the preferential credit package for high-tech agricultural firms to VND100 trillion from VND60 trillion. Agriculture is one of the pillars of the country’s economy, and the central bank should direct commercial banks to provide more support and raise the limit of credit packages, the PM said.

Phuc said he wanted more attention paid to developing human resources geared towards high-tech agriculture, and to expanding markets, promoting trademarks and improving packaging, thus ensuring stable consumption.

The SBV is also required to amend and supplement the Government Decree No 55/2015/ND-CP dated June 9, 2015, on credit policy for agricultural and rural development, which aims to motivate enterprises investing in agriculture, especially high-tech agriculture, and issue medium-term credit for agricultural investors. 

LienVietPostBank funds VND3 trillion for macadamia plantation     

Lien Viet Post Joint Stock Commercial Bank (LienVietPostBank) will provide preferential credit of VND3 trillion (US$131.8 million) to plant macadamia and cash crops (coffee and pepper) in the Tay Nguyen (Central Highlands) province of Dak Nong.

This money will be used to support macadamia farmers, organisations and firms purchasing and processing macadamia and developing cash crops in this Central Highlands province.

The bank last year provided a VND10 trillion loan to promote macadamia plantation in Lam Dong Province and co-ordinated with insurance agencies to introduce an agricultural insurance scheme for macadamia.

In addition, the Him Lam Joint Stock Company has committed to invest VND1 trillion in planting macadamia, developing raw material areas and constructing a macadamia processing factory in Lam Dong Province.

With this credit package, LienVietPostBank is considered one of the leading firms in promoting the Vietnamese macadamia industry.

The macadamia nut is dubbed as the "Queen of Nuts" for its outstanding nutritional value and high concentration of mono-unsaturated fats.

The plant, indigenous to Australia, was introduced to Viet Nam in 2002 by former deputy prime minister Nguyen Cong Tan through a trial cultivation in some central provinces, including Lam Dong, Dak Nong and Dak Lak. After more than a decade under trial cultivation, it was found that Viet Nam produced a higher yield of macadamias than other countries.

Local scientists have tested and found that the north-western and Central Highlands regions have conditions best suited for the plant’s growth.

By September 2014, the plant covered 1,600ha in the Central Highlands region. 

VCCI warns about severe corruption

About 49% of the FDI firms still have to bribe authorities, the Vietnam Chamber of Commerce and Industry (VCCI) reported at the launch of the provincial competitiveness index (PCI) on March 14.   

Several surveys have been carried out with FDI firms to ask what obstacles they faced during investment in Vietnam such as 'greasing fees' when asking for permits, joining agreements to provide goods and services for state agencies or when doing customs and court procedures.

However, most of the firms were reluctant to answer or didn't answer truthfully for fear of being harassed later, especially firms from countries that signed the OECD Anti-Bribery Convention.

25% of firms admitted that they had given bribes for investment permits and 13.6% said they gave commission money to compete for contracts from state agencies. Both of these rates were lower than 2015.

32% of firms said they always faced difficulties when refusing to give bribes, 26% often and 30% sometimes have those difficulties.

According to the VCCI, the total amount of money lost to corruption should not include only direct bribery money but also the lost effectiveness of the project when weak contractors are selected. The cost of projects have increased against estimates, while the quality is often poorer.

The survey also points out that 49% of firms confirmed that they had given bribes when doing customs procedures, a decrease of 10% from previous year. 56% agreed with the statement that state officials used the excuse to monitoring the law compliance to ask for bribes. 19% said they decided against lawsuits for fear of bribery in court.

On the other hand, there are also many firms actively give bribes to officials. 45% gave bribes during inspections last year to reduce the probability of fines. They think that bribery is common now; it's an unwritten rule so they actively give bribes without being asked for.

"Such perceptions show the severity of corruption in Vietnam and the difficulty of the fight against corruption. It has become so common that both sides don't even need to mention it anymore," VCCI said in the report.

Ha Tinh targets Vung Ang Economic Zone investment

Local authorities in the central province of Ha Tinh believes that a new investment wave in Vung Ang Economic Zone can save many firms from bankruptcy. 

Vice chairman of Ha Tinh Provincial People's Committee, Duong Tat Thang, who is tasked with managing the Vung Ang Economic Zone,  talked with Dan Tri/DTiNews about the problems on March 12. 

Vice chairman of Ha Tinh Provincial People's Committee, Duong Tat Thang, (left) talked with Dan Tri/DTiNews reporter on March 12.

Thang confirmed that investors and firms in Vung Ang are facing many difficulties, which he said is now among the most concerned matters of leaders of the province.

The vice chairman pointed out four causes leading to these difficulties.

The first cause relates to the Formosa Company which is the largest firm in Vung Ang with many projects including steel, ports and thermoelectric power plant ending the first phase. When these contractors left, firms operating in construction materials, transportation, and accommodation services here have all lost their partners and will be heavily affected.

The second cause, which also relates to Formosa, is the environmental disaster which occurred last April. Formosa had to stop nearly all their activities to solve the problems, leading to the leaving of many investors.

The third cause is the vast investment without careful consideration. 

"There has been a big investment wave in Vung Ang with trillions of VND from the state budget and billions of USD from domestic and foreign investors being poured to the zone," Thang explained, adding that many investors had just followed one another and only sought short-term benefits without seeing the potential risks.

Talking about the last cause, Thang admitted responsibilities of the local authorities when approving too many investors which led to unhealthy competition. 

"Many quarrying companies are facing bankruptcy due to our approving of nearly 60 licences at the same time," Thang admitted. "They have had to face rising competition due to falling demand."

According to Thang, Vung Ang Economic Zone needs a second investment wave to rescue the firms here besides suitable supporting policies from local government.

"There is still big investment potential in Vung Ang," Thang noted. "With a total area of 700 hectares in addition to many ports and other infrastructure being planned, we can still hope for new investors."

The official admitted that it could be a hard job attracting more investment at this time after the Formosa disaster but they will try.

"We're co-operating with the Ministry of Natural Resources and Environment to and other agencies to solve the environmental consequences left by the Formosa Company," he said. "In the meantime, we're trying to improve our investment environment here so as to attract new investors which can help us reduce our dependence on Formosa."

According to the management board of Vung Ang Economic Zone, to date, the zone has attracted 29 projects; but, up to nine of them have their investment licences revoked, including four foreign-invested projects due to the long delay or ineffective operations.

Three other projects in the zone with a total investment of millions of US dollars will have their investment licences withdrawn, including two foreign-invested firms due to stagnant or poor performance.

Government SOE initiative international ovation

The government’s latest order to further control the business and production performance of state-owned groups and corporations has received the international thumbs-up.

In a resolution on solutions for macro-economic monitoring released on March 10, the government ordered ministries and localities’ people’s committees to “strengthen the inspection and supervision of the operational effectiveness of all state-owned groups and corporations.”

The groups and corporations will also have to periodically report their operational results to the government.

The government’s tough move, aimed to make groups and corporations more transparent, has been highly commended by foreign experts.

Hong Sun, general secretary of the Korea Chamber of Business in Vietnam, told VIR that the move “will help strengthen foreign investors’ confidence in the government’s efforts to make state-owned enterprises (SOEs) operate transparently.”

“SOEs’ money is by nature that of the public. Thus it is quite necessary to have close control over their operations,” he said.

“International financial organisations and foreign firms are greatly interested in Vietnamese SOEs’ operations, because they want SOEs to quicken their equitisation,” he said. “However, over the past many years, such operations have never been made transparent.”

Echoing this view, Aaron Batten, country economist from the Asian Development Bank’s Vietnam Resident Mission, also told VIR that the Vietnamese government should have closer control over SOEs. It is also necessary to “reduce, and eventually remove state ownership in many commercial sectors of the economy, to allow the private sector to grow and compete on a level playing field.”

According to Batten, Vietnam currently adopts a decentralised system of ownership over SOEs. The system is common in countries that have favoured economic intervention by the state and with a large number of SOEs, as it allowed the line ministry to use sector expertise to implement an active industrial policy.

“However, decentralisation also causes fragmented ownership, weakening the power of the state to push ahead with SOE reforms. Lacking clear accountability lines and being difficult to coordinate can contribute to inefficiencies within SOEs,” Batten said.

Meanwhile, Warren Mundy, managing director of Australia’s BlueStone Consulting Pty., Ltd. and former commissioner of Australia’s Productivity Commission, told VIR that in Vietnam, SOEs dominate many important markets, such as electricity, gas, oil, minerals, telecommunication services, domestic air transportation, credit financing, and railways, which is unfair to private firms.

“Transparency, openness, and a strong commitment to robustly reforming SOEs and institution are central to ensuring a level playing field for all enterprises, and that Vietnam can lure more foreign direct investment,” stressed Mundy, who used to work with Vietnam’s Central Institute for Economic Management on economic reforms.

The International Monetary Fund suggested that Vietnam should accelerate the reform of the SOE sector. Key elements include: faster and more comprehensive equitisation, while ensuring due process; transparency of equitisation procedures and their use; enforcement of disclosure and reporting requirements; governance reforms to address conflicts of interests between regulations and SOE management, along with strengthened accountability; continued divestment from non-core areas; restructuring and eventual exit of unprofitable SOEs; and the creation of a level playing field with the private sector by curtailing SOEs’ preferential access to credit and other resources.

New Name, same trusted capabilities: Emerson Network Power Rebrands as Vertiv in Vietnam

Vertiv, formerly Emerson Network Power, on March 14 officially launched under its new branding in Vietnam, aggressively expanding into key local industries.

Vertiv is the new name, but the company is still an established global industry leader. It’s a trusted partner for the operators in data centres, communication networks and commercial and industrial facilities, and one with newfound speed, focus and flexibility as a standalone company.

With offices in both Hanoi and Ho Chi Minh cities, Vertiv in Vietnam will build on the broad portfolio of product and service offerings for power, thermal and IT management capabilities it previously offered  as Emerson Network Power, including its industry-leading  flagship brands ASCO, Chloride, Liebert, NetSure and Trellis. This follows the global campaign to rebrand Vertiv as a standalone company after completing the sale to Platinum Equity. 

Truong Quang Dzung, country manager of Vertiv in Vietnam, said that the company will be aggressively expanding into the telecommunications, banking, healthcare and transportation industries.

“We are seeing strong demand for our products, solutions and services from these industries,” he said. “In the telecommunications industry, for example, local operators are now aggressively increasing their bandwidth and coverage on fixed-line broadband and mobile networks, as well as 4G technologies.” 

“Digital transformation is also taking place in the banking and healthcare industries with the increasing deployment of e-services. For many years, Vertiv has been the preferred provider of robust and reliable infrastructure not just in telecom networks, but also in data centres in these industries,” he added.

In addition, Vietnam is also seeing growth in the manufacturing sector, as the country eyes to become a global manufacturing hub. 

Apart from its industry leading power, thermal and infrastructure management solutions, Vertiv also has its turnkey data centres, which combine power, thermal and monitoring in a rapidly deployable solution that is more cost effective and efficient than traditional data centre builds. 

“We are excited to be Vertiv and we will continue to work closely with our customers and partners in enabling Vietnam’s digital transformation initiatives,” added Dzung. 

“Vietnam is a key market for us here in Asia. As Vertiv, we will continue to build on the unmatched legacy and strong foundation we’ve established over the years. We are committed to helping our customers achieve their goals and enable their digital strategies,” Paul Churchill, vice president of Southeast Asia sales at Vertiv, said of the rebrand.

Niwa Foundry Vietnam inaugurates new plant at Danang Hi-tech Park

On March 10, Niwa Japan inaugurated the new plant of Niwa Foundry Vietnam at Danang Hi-tech Park.

Niwa has been operating in Vietnam for four years, supplying cylinder-block engine castings. “Niwa has received a great number of purchase orders over the last 10 years. This is a fruitful achievement for constant efforts to build reputation and credit of the company,” chairman Tatsumi Niwa said in his opening remark.

Niwa Foundry Vietnam was built on a 3.11 hectare site at Danang Hi-tech Park in Hoa Vang District with total investment capital of approximately $30 million. The plant will manufacture engine castings for hydraulic parts, and high precision mechanical parts used for industrial machinery including excavators and bulldozers and agricultural machinery including harvesters and tractors. The plant will provide products to businesses of both Japan and Vietnam.

“Niwa Foundry Vietnam will continue to strive to be worthy of Danang Hi-tech Park’s stature,” chairman Niwa said.

“As one of the 10 leading companies in foundry firms of Japan with over 60 years of experience, Niwa Foundry Vietnam will provide products appropriate for the development of national and municipal supporting industries, especially when there are limited suppliers for supporting products,” said Ho Ky Minh, vice chairman of Danang People’s Committee at the ceremony. “At the same time, Niwa Foundry Vietnam is expected to be a driving force for supporting industries of Danang and central Vietnam.”

Sacombank and Maritime Bank thick as thieves with Paradise Bay Resort?

Sacombank and Maritime Bank are likely cooperating at Paradise Bay Resort Co., Ltd., developer of Alma Resort in Khanh Hoa Province, in order to trick customers that signed the company’s vacation right ownership contracts.

After our articles on false advertising and other opacity surrounding Paradise Bay Resort Co., Ltd. and Alma Resort, VIR continued to receive letters from customers who claimed they were tricked out of their money.

T. from Ho Chi Minh City said that at the conference held by the company to introduce the project, after he heard all the good things about the project and the benefits of exchanging vacations, a salesperson introduced to him a scheme through which he could open a Sacombank-Alma credit card reserved for customers with incomes of at least VND5 million ($219) a month, through which customers can borrow up to VND1 billion ($44,000).

This arrangement also allows a customer that signs the contract to own vacation rights at Paradise Bay Resort Co., Ltd. to deposit less than the minimum amount stated by the company, while the rest will be a debt taken from the credit card. According to this arrangement, the card holder will not have to pay interest for 10 months.

T. said he and many other guests trusted Sacombank and were lured by the 10 months of zero interest, so they signed the vacation right ownership contract before reading the fine print.

Since 2013 Paradise Bay Resort Co., Ltd. has invited numerous people to join these conferences to “introduce and gather opinion about the vacation right ownership model” at its three branches in Hanoi, Ho Chi Minh City. and Nha Trang, with the promise that participants will be given vouchers. These sessions were not just to introduce and gather opinions though.

T. said that at first they did introduce and asked for participants’ thoughts in earnest, but then groups of two were led to small rooms to meet with salespersons. There they were invited to sign a “placeholding” contract and were requiredto pay a very small fee, after which the salesperson would follow them home to collect the remaining “placeholding” amount.

The salesperson explained some terms in the contract and handed it to them to sign. Then two weeks later T. received the contract signed and sealed by the company. He read it again and found unreasonable terms and conditions. He asked the company to nullify the contract, which they refused. Then a few days later he was called on by the bank to carry out procedures to disburse the loan.

Customer M. from Ho Chi Minh City said she attended a conference of Paradise Bay Resort Co., Ltd. in Ho Chi Minh City and was told that Maritime Bank would let her borrow 50 per cent of the deposit with zero interest for the first 24 months.

M. said she signed the contract and paid VND1 million ($44) upfront. Then the salesperson from Paradise Bay Resort Co., Ltd. followed her home to collect another VND115 million ($5,000). 10 minutes later she suddenly changed her mind and called the salesperson saying she wished to nullify the contract but was told it was impossible.

VIR will continue investigating the cooperative relationship between Sacombank and Maritime Bank with Paradise Bay Resort Co., Ltd.

Customers told VIR that one of the reasons they signed the contract was the trust they placed in Sacombank and Maritime Bank. They said they thought these banks had already performed a legal check on Paradise Bay Resort Co., Ltd. and these contracts.

In an interview with Khanh Hoa newspaper, Tran Minh Hai, deputy director of the Khanh Hoa Department of Planning and Investment, said that the department had asked Paradise Bay Resort Co., Ltd. to respond to the recent complaints from customers. The company sent back to the department a few hundred pages of contracts.

“This kind of contract is a landmine for the average person,” Hai said.

Lawyer Tran Duc Phuong from the Ho Chi Minh City Lawyers’ Association assessed that these banks should re-evaluate their relationship with Alma in order not to harm their own reputation.

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