Trade with Austria has room to grow

Viet Nam and Austria had room to accelerate their bilateral relations, especially in trade and investment, said Viet Nam Chamber of Commerce and Industry vice chairman Doan Duy Khuong yesterday.

During a business conference in Ha Noi, Khuong emphasised the great role of businesses in enhancing and speeding up co-operation between the two countries.

Viet Nam was making efforts to step up economic reforms, with a focus on facilitating the development of the private sector and perfecting the legal system and market economy mechanism to attract more foreign investment, Khuong said.

"During this process, we welcome and are ready to create the most favourable conditions for foreign investors, including those from Austria," he said.

Austrian Federal Economic Chamber general director Walter Koren said Austrian companies had paid increasing attention to investing in Viet Nam,

Fifty Austrian companies at the conference expected not only a better insight into Viet Nam's market potential but specifically to learn the advantages of maintaining a presence in the country, he said.

He also encouraged Vietnamese companies to co-operate more actively with Austrian counterparts to unleash untapped potential.

Vietnamese Trade Counsellor in Austria Nguyen Thi Thu Huong called on domestic companies to increase their exports to Austria and then utilise its ideal location as a hub for their expansion into other markets in Europe.

However, Huong advised firms to work closely with her office in order to find reliable Austrian trade partners and to avoid possible business risks.

Besides trade, she also outlined industry and energy, infrastructure, tourism and healthcare as promising sectors for businesses.

Bilateral trade between Viet Nam and Austria has experienced significant growth over recent years. It reached US$630 million in 2011, a year on year increase of 240 per cent, and $171 million in the first quarter of this year.

Viet Nam mainly exports mobile phones and components, footwear and garments to Austria, while importing mainly machinery and equipment, pharmaceuticals and steel.

Last year, Austria pumped $51 million into 19 projects in Viet Nam, ranking 51st among 94 countries and territories investing in the country. Austrian investment was mostly in manufacturing and processing, accommodation and food services, as well as entertainment.

Stocks reverse previous day's gains

Shares declined again yesterday on the nation's stock exchanges, after posting gains on Wednesday.

On the HCM City Stock Exchange, the VN-Index tumbled 1.4 per cent, finishing at 429.20 points. It lost a cumulative total of 9.2 per cent over the course of the past month.

The VN30 Index, tracking the southern bourse's 30 leading stocks, closed at 507.07 points, a 1.2-per-cent fall-off. Of this group of shares, only those of construction firm Sudico (SJS) and Vinh Son-Song Hinh Hydropower Co (VSH) managed to add points. Others lost significant value, including real estate developers Hoang Anh Gia Lai (HAG) and Vingroup (VIC), and Vietcombank (VCB).

Recently-listed PetroVietnam Gas (GAS), which is not included on the VN30 but has become the second-leading share by capitalisation on the HCM City bourse, also declined.

The overall value of trades in HCM City yesterday reached VND732 billion (US$34.8 million) on a volume of 48.2 million shares.

On the Ha Noi Stock Exchange, however, value rose by 26.4 per cent over the previous day to VND437 billion ($20.8 million), while volume exceeded 44 million shares. The HNX-Index hit 74.07 points, a retreat of over 2 per cent.

VNDirect Securities Co (VND) emerged as the most-active share nationwide with around 3.2 million units exchanged.

"Stock indices will need at least one or two weeks to get rid of the current accumulative phase and see improved liquidity," predicted Bao Viet Securities Co analyst Nguyen Xuan Binh.

According to BIDV Securities Co analysts, the market lacked any increasing impetus and sell pressures remained high. "Based on current market movements, expected profits can't make up for the risks," they said.

Despite the mood among domestic investors, foreign investors continued to be buyers on both bourses by a combined net of VND72 billion ($3.4 million).

WB predicts 5.7 percent GDP growth for Vietnam

Vietnam is expected to achieve around 5.7 percent economic growth in 2012 and 6.3 percent in 2013, according to a recent forecast by the World Bank (WB) in Hanoi.

Year-end inflation is predicted to stay at 8-9 percent in 2012 and fall to 6 percent next year.

According to WB experts, Vietnam’s economic environment has improved in recent times with slowing inflation, stable exchange rates, rising reserves and a reduction of economic risks.

In particular, the nation’s export turnover rose sharply in the first five months of the year, mostly contributed by the export of mobile phones and spare parts (up 154 percent), and electronics and computers (up 100 percent).

However, the WB experts warned that Vietnam’s economy is slowing down as a consequence of the global economic downturn and macroeconomic stability policy.

Over the past two months, the State Bank of Vietnam has constantly slashed its basic interest rates by a total of 3 percent. Yet, the WB experts said the country’s monetary policy is mainly based on administrative orders, not the market.

They warned that loosening the monetary policy too swiftly could make high inflation boomerang one day.

Taxpayers say it’s not easy to get refunds

Within the first four months of this year alone, the Ho Chi Minh City Tax Agency has received 7,000 applications for personal income tax refunds, more than double last year’s figure.

In Vietnam, it is stipulated that individuals be deducted 10 percent of their infrequent incomes, such as bonuses or lottery winnings, on receiving them. At the end of each year, the individuals can receive a refund of the deducted amounts if their total yearly income is under the threshold required to pay personal income tax.

But the road to get the money back is not an easy one , especially for teachers and workers, who still have hadtheir irregular incomes deducted despite earning modest incomes undoubtedly below the tax threshold.

For instance, Nguyen Thi Thu Ha, a taxpayer, said she submitted a refund application to the tax agency in District 1 on March 28, and was told that her application was complete and valid.

In previous years Ha would have to wait only a couple of weeks to receive the notification to get the money back at the state treasury, , but this time she has been waiting for two months and has yet to receive any announcement.

Upon telephoning the agency to question the delay, Ha was told that “it’s due to a personnel change in the agency executive board.”

“I asked them again on May 22 and was told that the person in charge of my application has been transferred to another department, and that I have to continue waiting,” Ha said.

“How on earth could a personnel change delay an application approval for as long as two months?”

Meanwhile, Nguyen Thi Ngoc Ha, who teaches English at a high school in Binh Chanh District, said she went to the district tax agency to hand in the application for a refund of VND185,000 (US$8.8), which was deducted from the wages she received for writing to a newspaper.

Although the newspaper had specified her name, tax code, and identification number in her application, the tax official insisted that the institution also fill in her address and telephone number.

“It means I have to travel a long way from Binh Chanh District to District 3 to fulfill their request,” said Ha, adding that she of course refused to follow their demands.

“I had argued with him for a while before that official’s superior intervened, saying it’s too small a sum to argue about, thanks to which I finally had my application received.”

A representative of Garmex Saigon Co, a garment manufacturer, said that the monthly incomes of its laborers are always under the tax threshold.

But in December, the laborers have to have their wages deducted thanks to the bonus to celebrate the Lunar New Year, or Tet.

Since the laborers will certainly have to get the tax refunds for this deduction, some have refused their bonus for fear of the complex procedures required to get the refunds, the company said.

The accountant of Nissan Co also said many workers at the company also accept losing their bonus for a similar reason.

“[Laborers] have to ask for a day off to go to the tax agency, which means their salary will be reduced, while they can never complete all the procedures within just 1 day,” the accountant explained.

Supermarkets get ready for Children's Day

Many supermarkets nationwide have launched promotions and entertainment activities to celebrate International Children's Day (June 1).

BigC supermarket, for example, is offering discounts of 5 to 30 per cent on more than 950 items for children, including milk, confectionery, toys and clothes under the promotion programme "Dinh duong hoan hao - Nang buoc tre tho" (Perfect Nutrition – Improving Children's Progress).

In addition, Co.opMart supermarkets is offering similar discounts on more than 1,000 items for children. About 500 items, mainly clothes, toys and foods at Vinatexmart, are being discounted up to 50 per cent.

Other supermarkets, including Maximark and Lotte Mart, also offer discounts on goods for children.

At BigC, Co.opMart, Lotte Mart and Vinatexmart, children will also have opportunities to take part in activities, including colouring statues, painting, karaoke and game shows.

Big C will present 2,000 gifts worth VND200,000 (US$9.52) each to disadvantaged children who live in the areas where their outlets are located.

Shops specialising in children's toys and clothes in the city are also offering discounts of 20-30 per cent to boost sales.

Toyshop owners said that fighter robots, remotely-controlled aircraft, yoyos and dolls are among the bestsellers. Along with promotions at supermarkets, many other fun activities will be held for children nationwide.

Vinacomin to issue bonds
 
The country's largest mining firm, Viet Nam National Coal and Mineral Industries Group (Vinacomin), plans to issue 3,000 domestic bonds this year at VND1 billion (US$48,000) each.

The bond term will be for 5-7 years.

Chairman of the group's member council Tran Xuan Hoa said the capital mobilised from the bond issuance would be used to boost investment, business and production operations.

The group pledged it would manage and use the capital in accordance with its set purposes. The 2012 bonds would be a safe and effective investment, it said.

As part of a joint venture, acting as an issuance agent, Deputy General Director of the Viet Nam Bank for Industry and Trade (Vietin Bank) Le Duc Tho confirmed that Vinacomin's 2012 domestic bond issuance would follow the country's regulations as well as correspond with international standards.

The bonds would enjoy floating interest to be paid annually, he said.

Deputy General Director of Vinacomin Nguyen Van Bien said his group would use the capital for projects in the 2011-15 period, which had been already approved by the Prime Minister. These projects were very important in contributing to ensuring the economy's need for coal and natural minerals and national energy security as well as economic development.

A report made after auditing showed the group's revenue reached VND87.6 trillion ($4.3 trillion) in 2011, making a profit of VND8.6 trillion ($413 million). Nearly 137,000 workers had an average monthly salary of VND8 million ($380.95) each.

The group expects to earn VND96 trillion ($4.6 trillion) this year.

At present, Vinacomin has been exploiting 23 open-cast coal mines and 46 coal pits. An alumina production factory, the first of its kind in Viet Nam, will come into operation by the fourth quarter of this year. Another will be operational at the same time next year.

The group has five electricity plants with a combined capacity of 1,110MW and is building four others with a combined capacity of 720MW.

EVN clashes with small power producers   

Small power plants in some northern provinces have been complaining about being squeezed by the Electricity of Vietnam Group (EVN), claiming that they are taking losses.

Vu Ngoc Cu, Vice President of Lao Cai Enterprises Association, said they have received numerous complaints and reports of losses.

The main reason was determined to be material prices, labour costs and an unexpectedly disadvantageous exchange rate. According to the reports, material prices have increased by 30% and interest rates have been raised from 13% to 24%, while the selling price for electricity after one year under operation has remained low at VND922 per kWh. Meanwhile, EVN has continued imports China, selling at VND1,286 (USD0.06) per kWh.

An investor of Nam Khoa 3 hydro power plant in Lao Cai Province, Duong Thi Loi said many small-cale power plants in Lao Cai and Ha Giang Province have been facing great difficulties when their power generation capacity is cut during peak hours, and end up having to take on debt.

"We have sent several complaints to the Ministry of Industry and Trade, Electricity Regulatory Authority of Vietnam and the Northern Power Corporation (EVN-NPC) but they seem to be ignored," Loi said.

EVN-NPC, a corporation responsible for providing electricity to 27 provinces and cities, said that 12 provinces are dependent on electricity bought from China via 110kV and 220kV lines. However, because the electricity grid is old and outdated, when the small power plants generate electricity at the same time, the power they produce becomes redundant, and leaks back to China. The corporation will be fined.

EVN's Deputy General Director, Dinh Quang Tri, said, "Power plants that produce less than 30MW must also provide their own lines to join the electricity grid. However, many enterprises use combine their production capacity in order to force EVN build the connecting lines. Many investors force us to buy their electricity by deliberately building plants even though no contract has been signed. EVN's lines will be overloaded from all theses companies. For this reason we have cut domestic generating capacity for two hours a day. We demand that the Ministry of Industry and Trade clear up the responsibility of investors for their own lines."

VN, Paraguay expand trade, investment promotion

The Vietnamese Embassy in Paraguay and the Paraguay-Vietnam Trade, Industry and Culture Chamber held a get-together in Asuncion on May 29, with businesses of the Latin American country.

Vietnamese Ambassador to Argentina and Paraguay Nguyen Van Dao introduced major characteristics of Vietnam’s socio-economy as well as its trade and investment policies.

He also stressed the developments in trade cooperation between Vietnam and Paraguay and the Latin American countries.

The ambassador also took the occasion to invite Paraguay enterprises to attend the ministerial meeting on trade and investment with Latin America, to boost cooperation potential in that area.

Paraguayan businesses expressed a desire to cooperate with Vietnam. Some of them said they will attend the Vietnam-Latin America Trade and Investment Forum in Hanoi in early July.

According to Paraguayan customs, two-way trade between Paraguay and Vietnam has surged in recent years, reaching a record high of $51 million USD in 2011, of which Vietnam exported $13.7 million.

Vietnam exports sport shoes, electric fans, motorcycle spare parts, water pumping machinery and garments to Paraguay and imports soybean powder and oil, beef, wheat, maize, leather, wood and cotton from the Latin American country.

SJC refuses to buy deformed gold bars

Four days after the new regulation on trading gold bullion took effect, the domestic gold market has yet to stabilize as Saigon Jewelry Co, the country’s largest gold trader, now refuses to buy back deformed SJC gold bullion.

According to the owner of a gold shop in Ho Chi Minh City’s District 8, after receiving some distorted SJC gold bars from customers, he phoned SJC to ask about returning the products, and was told that the company was “temporarily closed for three days to wait for more information from the State Bank of Vietnam,” he said.

The man said earlier it was easy to exchange the deformed gold bullion, as customers had to pay a fee of VND60,000 to reshape the bars.

Other gold shops said this refusal has troubled them with huge stocks of gold, the prices of which have constantly fluctuated.

A gold shop in District 1 said all shops now carefully examine gold bullion before buying it.

“If the bullion has any flaws or spots, it can only be purchased at the price of raw gold,” the shop owner said.

Meanwhile, Nguyen Cong Tuong, SJC deputy head of sales, confirmed that the company has stopped exchanging deformed SJC gold bullion as of May 25 because the central bank has restricted its gold bullion processing following a new management regulation.

“SJC has submitted documents to the central bank to ask for permission to reshape the deformed bars, but has yet to receive any response,” said Tuong.

Gold in Vietnam lost VND300,000 a tael this morning, after fluctuating inconsiderably in previous sessions, following a sharp fall of global prices.

SJC gold bullion was quoted at VND40.91 million a tael this morning, and sold at VND41.21 million a tael. PNJ gold bars from the Phu Nhuan Jewelry Co were bought at VND40.93 million, and sold at VND41.18 million a tael.

Gold for June delivery on Comex dropped by $20.2 to $1,548.7 an ounce over concern about Spanish debt.

On the Asian market, the precious metal settled at $1,547.9 an ounce this morning, down by $6.9 an ounce from yesterday’s closing.

Under this price, gold in Vietnam is currently VND1.7 million a tael higher than its global counterpart.

(1tael = 37.5 grams; VND1 million = $48)

Thai fruit festival to take place in Hanoi

A Thai fruit festival will be held at the Garden Commercial Centre in Hanoi from June 2-5 by the Thai Agricultural Research Development Department.
    
The most delicious fruits will be shipped to Hanoi from the eastern provinces of Thailand, such as Rayong and Chantaburi&Trad and displayed at a Thai styled wooden house.

Visitors will have a good chance to taste and to buy the most favourite fruit products.

The festival will help businesses from Vietnam and Thailand to seek cooperative opportunities.

US$3.34 billion ODA for agriculture and rural development

Total official development assistance (ODA) capital for agriculture and rural development and poverty reduction in the 2006-2010 period reached more than US$3.34 billion.  

Of the figure, US$ 2.65 billion has been disbursed, 21.76 percent of total national ODA disbursement.

They are the initial results of a project on attracting, managing and using ODA capital and preferential loans in the 2011-2015 period, which has been approved by the Prime Minister.

Although the capital is much lower than the target set in the project, it has helped modernise rural infrastructure by developing rural electricity grids, rural transport systems, schools, medical centres, hospitals, irrigation projects, water supply and environmental sanitation networks.

It has also supported the development of agriculture, forestry, and fisheries, accelerating poverty reduction and promoting farming and husbandry technology transfer for the application of clean technologies to improve product quality  and food safety.

ODA capital has also contributed to poverty reduction for people in rural areas, helping Vietnam meet the UN millennium development goals toward reducing the household poverty rate by 50 percent by 2015.

Tosy boosts toy exports overseas

Tosy Robotics Company has experienced substantial growth in its domestic sales, with 40,000 sets of toys sold out in May, thanks to the rising demand on International Children Day (June 1).   

Its popular products, frisbee (TOOP) and gyroscope (AFO) are currently sold for VND 139,000 and VND 129,000 each, respectively.

So far, Tosy has signed big contracts for shipments to France, Denmark, Sweden, Norway and some Middle East countries. Especially, many markets have ordered twice for Tosy frisbees and gyroscopes.

The company is going to negotiate with the world’s largest retailers such as Toys “R” Us and Best Buy to boost its export of Vietnamese toys. It is also preparing to introduce its advanced technological robotic toys after great success at recent international exhibitions.

Tosy gyroscopes have won the 2011 Best Toy Awards by Good Housekeeping Magazine, and have been voted as the Top High-tech Toy at the 2011 American International Toy Fair.

Vietnam attends APEC meeting

Agriculture Minister Cao Duc Phat has joined other ministers from 21 APEC member countries and territories at the Asia Pacific Economic Cooperation (APEC) Ministerial Meeting on Food Security in Russia’s Republic of Tatarstan.

Taking place on May 30-31 in Tatarstan capital city of Kazan as part of activities to prepare for the APEC Leaders’ Meeting in September in Vladivostok, Russia, the event aims to discuss issues relating to ensuring food security.

During the two-day meeting, delegates discussed measures to ensure sufficient provision and quality of food under international standards.

They also worked out solutions for boosting agricultural production through application of advanced technology.

Minister Phat met his Russian counterpart Nikolai Fedorov to deliberate ways to promote agricultural cooperation between the two countries, including Vietnam’s food and seafood exports to Russia.

Businesses eye Hong Kong market

How to successfully penetrate Hong Kong (China) was discussed at a workshop in Ho Chi Minh on May 30.    

The workshop, jointly held by The Vietnam Trade Promotion Agency (Vietrade) and the Hong Kong Trade Development Council (HKTDC) in Vietnam, aims to strengthen trade and investment ties between Vietnam and Hong Kong, and to create opportunities for businesses to enter the Hong Kong market.

Participants were provided with information on building brands and on the current trends for small and medium-scale businesses operating in different industries. Some experts also shared ways of designing and managing brands, helping businesses increase their market, share gain foothold, polish the images and attract customers.

The HKTDC Regional Director for Southeast Asia and India, Loretta Wan said that HKTDC wants to boost cooperation with Vietnamese organizations and agencies in order to effectively attract customers in different fields, especially in services, and organization of exhibitions and fairs.

In recent years, two-way trade between Vietnam and Hong Kong has achieved steady growth. Trade turnover reached US$ 8.4 billion in 2011 and US$ 526.5 million in the first two months of 2012.

Vietnam exports various kinds of goods to Hong Kong such as electronics, machines and components, electric wires, cables, rice and aquatic products.

Workshop highlights Vietnam’s international integration

Leaders from 21 southern provinces and cities gathered in Ho Chi Minh City on May 30 to review international integration in recent times and orientations for 2020.     

The workshop aims to collect ideas for the Politburo’s draft resolution on international integration from now to 2020.

Participants agreed that, in the current situation, accelerating economic growth requires international integration, in which localities play an active role in strengthening cooperation with partners and implementing bilateral agreements. Therefore, they said the Government should have specific orientations for localities to integrate deeply and effectively.

Some participants proposed that the upcoming resolution should detail the finalisation of the organizational structure of localities which have not established external relations offices to help them promote international integration.

Banks won't lend on goods

According to a State Bank of Viet Nam regulation, enterprises have been allowed to mortgage their goods to borrow capital from banks, but most bankers have not been willing to do so despite their abundance of capital.

Bankers said they still accepted collateral of goods, but they were afraid of mortgage of products like coffee, rice, cement and steel because of the high risk of unstable prices.

Some products like coffee and rice do not have a long-term expiry date, they said.

In addition, when accepting this kind of collateral, banks have to pay more costs for storehouse rental, watchmen, management and asset assessments.

Vo Tri Thanh, deputy head of the Central Institute for Economic Management, agreed with bankers, saying that using goods as a collateral, especially farm produce, contains high risk.

In addition, banks may incur bad debts if management of warehouses is not implemented well. Long-term inventory of these goods also leads to bad debt at banks.

However, amid the current economic climate, many enterprises do not have property for collateral, and have to use their goods to mortgage.

According to Vietcombank and ACB, the number of businesses using their goods as mortgage for bank loans is increasing.

Banks must carefully check the quality and value of these goods before deciding to provide loans or not.

Currently, banks provide loans with a maximum limit of 30-50 per cent of the value of mortgaged assets to healthy businesses, with good capital rotation and good prestige.

Bui Kien Thanh, an economist, said the Government should exempt value-added tax to help enterprises cut production costs and solve their inventories.

In addition, because inventories are also enterprises' assets, banks should accept mortgages of this kind of asset to provide capital for enterprises, he noted.

A banking expert said the Government's Resolution 13 with measures to ease difficulties faced by enterprises, including adjusting lending interest rate with a difference of three per cent compared to deposit interest rate, had not helped to solve all of enterprises' difficulties.

The State Bank of Viet Nam should have measures to deal with procedures involving mortgage of inventory goods to support enterprises, he said.

With abundant capital, banks have invested in different sectors, including buying bonds issued by the Government and enterprises.

Bankers said, by buying bonds when they need capital or liquidity, they can use these bonds to mortgage at the central bank or sell the bonds, but they are unable to sell mortgaged goods right away.

For this reason, many banks still opt to invest in bonds.

EU to keep supporting VN's global integration

The European Union will continue to support Viet Nam's integration into the global trading and investment system via a new European Trade Policy and Investment Support project starting this year.

Franz Jessen, ambassador and delegation head of the EU to Viet Nam, made the statement at the closing ceremony of the Multilateral Trade Assistance Project (MUTRAP) held in Ha Noi yesterday.

MUTRAP is indeed one of the longest Trade Related Technical Assistance programmes we have had in Viet Nam. Its key impacts are the country's adoption of laws that aligned with international trade regulations, helping its own economic development. MUTRAP has also created greater awareness among Vietnamese exporters on how to access the European market, Jessen said.

He added that they funded 35 million euros (US$43.6 million) in the project and would add 15 million euros ($18.7 million) to MUTRAP IV, bringing its total fund to 50 million euros ($62.2 million).

Nguyen Thanh Bien, deputy minister of Industry and Trade (MoIT), said after four years of operation, the project has implemented 70 technical assistance activities.

"The project has helped strengthen the capacity of designing legal frameworks and normative documents such as from designing Competition Law to sub-law documents, including decrees, decisions of the Prime Minister and continues to help Viet Nam establish an appropriate legal framework according to its commitments in joining the WTO," Bien said.

He added that MUTRAP III also plays an important role in providing information and disseminating the results of international economic integration and Viet Nam-EU trade, economic relationship for the business community and people.

Truong Dinh Tuyen, former minister of Trade, said the project helped Viet Nam build two important legal documents including the law on Protection of Consumer Rights, from ideas to legal documents and two important development strategies: the export strategy from 2011 to 2020 with a vision to 2030 and the service development strategy from 2011 to 2020.

Tran Huu Huynh, deputy general secretary of Viet Nam Chamber of Commerce and Industry (VCCI), added that support for design strategies and legal documents was one of the most important activities of the project.

Its purpose was to support the MoIT improve law quality related to Viet Nam's trade and make legal documents be consistent with international obligations. While Viet Nam has been in the process of joining the international economy, these activities help it increase professionalism in trade and services as well as strengthen rights and benefits for local consumers.

In its 46 months of operation, the project has disseminated more than 30 publications in English and Vietnamese, some adopted as textbooks for some university courses, seven internet portals and websites.

Motorbike imports down in May

Viet Nam imported 1,000 Complete Built Unit (CBU) motorbikes worth US$1 million in May, hitting its lowest level over the past two years, according to the General Statistics Office (GSO).

During the first five months, the country imported 17,000 CBU motorbikes worth a total $26 million, representing a significant year-on-year decreases of 54 per cent in volume and 49 per cent in value.

$40m factory to produce plastic lids

Ngoc Nghia Industry, Service and Trading Co yesterday received approval from the Tay Ninh Economic Zones Management Board to develop a VND839 billion (about US$40 million) factory producing plastic lids in the province.

Covering in a total area of above 8,400sq.m in the provincial Linh Trung Industrial and Processing Zone, the factory will open its doors in 2015, providing 2 billion products each year.

As of May, Tay Ninh Province had attracted 206 foreign-invested projects worth a total of $1.43 billion. Of the total, 167 are already operational. It also granted business certificates to 3,157 domestic companies with a total registered capital of over VND17 trillion ($813 million).-

Thai firm to study expressway linking Halong, Mong Cai

Italian-Thai Development Public Co. Ltd. of Thailand will conduct study on the Halong-Mong Cai Expressway, under the memorandum signed with the government of Quang Ninh on Monday.

The expressway stretching 151.5 kilometers in Quang Ninh Province is part of the Noi Bai-Halong-Mong Cai expressway project. The expressway starts from the road connecting Halong City to the Hanoi-Haiphong Expressway and ends at Bac Luan II Bridge in Mong Cai City.

The project consists of six traffic lanes, with a road width of 35 meters and a design speed of 120 kilometers per hour. Along the route, there will be 17 large bridges, 42 medium bridges, eight intersection overpasses and 20 overpasses crossing over national highways and provincial roads.

It is expected that the expressway will be completed after three years of construction. The total investment capital is estimated at US$1.5 billion, says a report on the website of the Ministry of Transport.

At the working session, Do Thong, vice chairman of Quang Ninh, emphasized the Halong-Mong Cai Expressway plays an important role in promoting the development of Quang Ninh Province.

Earlier, Premchai Karnasuta, president of Italian-Thai Development, and his colleagues had surveyed the route to be turned into the Halong-Mong Cai Expressway. The company made a proposal concerning the issues of site clearance and change of the investment format.

In response to the proposal, vice chairman Thong asked the investor to speed up the research on the directions and the scale of the expressway, so that both sides can look into funding and investment method matters, aiming to have an investment proposal by late September.

The two sides will form a group in charge of accelerating the project study.

City to recall slow-moving industrial parks

The HCMC government has asked the HCMC Export Processing and Industrial Zones Authority (Hepza) to take tough sanctions against inefficient industrial parks causing a waste of land and polluting the environment.

According to the city’s instruction issued last Friday, Hepza needs to recall the investment licenses and redeem land from investors who are incapable of or intentionally delay implementing industrial parks projects.

This move was made in response to Directive 07/CT-TTg of the Government issued in March on improving the management and operation efficiency of economic zones and industrial parks.

HCMC currently has 14 industrial parks and export processing zones covering a total area of 3,620 hectares with the average occupancy rate of over 60%.

Under the city’s planning until 2020, the city will have 22 such zones with a total area of around 5,900 hectares. Some industrial parks which will be developed in the next few years include Vinh Loc III, Phuoc Hiep, Bau Dung, and Xuan Thoi Thuong with over 2,200 hectares in total.

The city’s government has also asked Hepza to review projects in industrial parks and export processing zones by August 15. Hepza is asked to make a list of slow-moving and inactive projects as well as those having almost gone bankrupt or violating the laws on investment, labor and environment.

The authorities of every district will also have to check the planning and operations of all projects in industrial parks, recall slow-moving and inefficient ones and do not develop industrial zones on rice farming land.

Largest fishing logistic vessel launched in Da Nang City

The largest fishing logistic vessel in Vietnam, and the first of its kind, was launched in Son Tra District in the central city of Da Nang on Tuesday.
 
The logistic vessel was made by a private shipyard, and will stock supplies of food, petrol and ice for fishing boats in the central region.

The 1,160cv vessel was built at a total cost of VND3 billion (US$143,000) by the ship building family of 52-year-old Le Men, owner of Ly Cu Shipyard in Tho Quang Ward.

The 26 metre long and 6 metre broad vessel has 27 cargo holds with capacity of 120 cubic metres. The vessel took three months to be built under the meticulous skills of members of Men’s family.

The vessel can fill up with 5,000-7,000 litres of petrol on a full tank; 1,200-1,500 long ice blocks and 20 tonnes of food stocks on a single trip, to service at least 30 fishing boats out at sea.

On its return trip to shore, to replenish stocks, it can bring back 100 tonnes of seafood.

The vessel is scheduled to launch on its inaugural trip on June 7. A single trip will last from three to six days, covering a radius of about 400 sea miles from the mainland.

BIDV, VIETPAY launch e-payment service

Bank for Investment and Development of Vietnam (BIDV) and Vietnam Electronic Payment Joint Stock Company (VIETPAY) will launch VIETPAY e-payment service at BIDV’s 600 transaction points nationwide from early June.

Customers who are retailers of VIETPAY sim card may top-up their VIETPAY sim accounts via BIDV anytime. Payments can be done via the bank’s online or mobile banking services and VIETPAY’s website.

Nguyen Duy Cuong, director of VIETPAY, said cooperation with BIDV will bring advantages to sim card retailers nationwide. With the VIETPAY sim, retailers can top up accounts for six mobile-phone networks of MobiFone, Vinaphone, Viettel, Vietnamobile, Beeline and S-Fone.

VIETPAY sim card also allows payments for online games of the four largest providers in Vietnam.

Sharp fall in price of fruits grown in Mekong Delta

The Mekong Delta in Vietnam is the country’s largest fruit growing area with a multitude of fruit varieties, yet at the moment as it begins to harvest its next crop, fruit prices are suddenly and sharply plummeting.

This is just the beginning of the mangosteen, durian, mango and rambutan season, and prices have already begun to fall sharply.

Nguyen Thanh Tam, a mangosteen grower in Xuan Hoa Commune of Ke Sach District in Soc Trang Province, said that just one month ago a kilogram of mangosteen fetched VND100,000, which now has plunged to only VND30,000-40,000 a kg.

Along Highway 1A from Tien Giang to Bac Lieu Province, durian is being sold at VND25,000-35,000 a kilogram, a drop of VND15,000-25,000 over the last month.

Price of other kinds of fruits has also dropped to half or one third than one month ago.

The sudden drop in domestic fruit price is being blamed on the abundance of foreign fruits coming into markets in the Mekong Delta.

At present, thousands of tonnes of foreign fruits are being imported to Vietnam each day, including familiar fruits like Chinese apples, pears and mandarins and grapefruit from the US.

Thai fruits like mangosteen, durian, mango and tamarind are also flooding fruit markets in the Mekong Delta.

Foreign fruits attract many local consumers as their price is the same or even less than some domestic grown fruits.

Firms confront decline in export values
 
Viet Nam had a year-on-year increase of 24.1 per cent in export value for the first five months to US$42.9 billion, according to the General Statistics Office.

The growth rate in export value was a positive sign in terms of the world economic crisis and economic difficulties in key export markets of Viet Nam, including the US, the EU and Japan.

However, during the first five months, foreign direct investment (FDI) firms accounted for 60.8 per cent of the total export value in Viet Nam.

The FDI firms gained a year-on-year surge of 36.9 per cent to $26.1 billion while the domestic firms saw a year-on-year increase of 8.4 per cent to $16.8 billion in the first five months.

Vo Tri Thanh, deputy head of the Central Institute of Economic Management (CIEM), said in general, the national export value was a bright point for the economic crisis but the export value of domestic firms was low, with no growth in the first quarter of this year.

Meanwhile, FDI firms had many advantages in exports, including the cheap capital from parent companies, trademarks and a stable consumption market. Therefore, they did not face as severe an impact from the world economic crisis as the domestic firms, Thanh said.

Export statistics figures showed export values made by FDI firms to be much higher than domestic firms' export values. The reason for this was that the FDI firms had large export markets and customers while domestic firms' export contracts relied on foreign partners' signing of contracts.

High input prices and difficulties in the world market were challenges for domestic exporters, said economist Le Dang Doanh.

Pham Xuan Hong, deputy chairman of the Viet Nam Textile and Apparel Association (Vitas), said the domestic exporters of the textile and apparel industry had difficulty in getting export orders, which were reduced by 5-10 per cent against the same period of last year.

Meanwhile, they found it hard to get loans even though lending interest rates fell to 15 per cent per year, Hong said.

The seafood exporters did neither have any new export markets and even some difficulty exporting to their traditional markets, said Truong Dinh Hoe, general secretary of the Viet Nam Association of Seafood Exporters and Producers (VASEP).

Long-term domestic exporters should improve in quality and added value of export products to increase their competitive edge. Not focusing on the competitiveness in export prices was also recommended due to anti-dumping price policies and technical barriers, said Thanh.

Cement inventories pile up

The cement industry failed to sell 3.5 million tonnes by the end of May though production output dropped 17 per cent to 19 million tonnes, according to the Viet Nam Cement Association.

The association's general secretary Do Duc Oanh said that high inventory was currently the biggest issue of the cement industry. The country's cement output this year is expected to reach 60-62 million tonnes while domestic consumption is estimated to hit around 47-48 million tonnes. With roughly 7-8 million tonnes of cement expected to be exported this year, the industry will retain roughly 6 million tonnes of unsold cement.

Industry insiders attributed the abundance to rampant investment over the past years. The country currently has more than 100 cement plants with a total design capacity of 70 million tonnes.

Due to large inventories, cement producers have had to cut their sales prices despite a high rise in input costs, which has pushed them into financial trouble.

Director of the Ministry of Construction's Building Material Department Le Van Toi said that cement producers were faced with major financial hardship as they could not raise sales prices while input costs rose sharply. Coal prices, for example, surged 170 per cent over last year. The rising figures for power and oil were 19 and 40 per cent.

The situation was even worse as most cement producers depended on bank loans while lending interest rates remained high.

Oanh said that most of producers suffered losses this year and several, including Thanh Liem Cement and Ang Son Cement, even had to stop operating.

To help cement producers overcome challenges, the association recommended the Government to restructure repayment periods for foreign and domestic loans.

The association also asked the Government to reduce value added tax to 5 per cent to ease financial hardships.

Besides measures to boost cement consumption, Oanh said the Government should decide whether to extend, postpone or even stop the construction of new cement projects to avoid a higher inventory.

If the industry's development plans were not considered carefully, the country would continue struggling with surplus stock, he said.

The Ministry of Construction recently announced that five out of eight cement plant projects, with a total designed capacity of 7.57 million tonnes, have not been put into operation as proposed under the governments' cement-industry development plan for 2011-20.

The five projects include the Trung Son plant in Hoa Binh with a capacity of 0.91 million tonnes, He Duong II in Ninh Binh with a capacity of 1.8 million tonnes, Ngoc Ha in Ha Giang with a capacity of 0.6 million tonnes, Dong Lam in Thua Thien - Hue with a capacity of 1.8 million tonnes and Vinafuji in Lao Cai with a capacity of 0.6 million tonnes.