Seminar discusses technology needs of Vietnamese firms

 The Ministry of Science and Technology (MoST) organised a seminar on technology demand of the business community in Hanoi on January 13, in order to help with the building of a Vietnam-Korea Institute of Science and Technology (V-KIST).

The V-KIST is a joint project between the two governments, aiming to boost sci-tech research and application in Vietnam. 

Kum Donghwa, a representative from the Korea Institute of Science and Technology (KIST) shared experience in the operation of the KIST and affirmed that the institute will support Vietnam in building the Vietnam-Korea Institute of Science and Technology.

Nguyen Dinh Hau, Director of the Department of Science and Technology for Economic-Technical Branches, said the V-KIST is expected to address technological issues facing Vietnamese firms.

Hau said there is a large gap in technology development between Vietnamese enterprises and their international peers, adding that most of advanced technologies available in the country concentrate in the foreign-funded sector.

According to Nguyen Anh Dung, deputy head of the MoST’s support centre for technology transfer, sectors that have highest demand for technological improvement include agricultural produce processing and mechanics.

Remittances support VN development

The increasing quantity of remittances sent back home by overseas Vietnamese over the past few years has helped the country offset its trade deficit, reduce poverty and improve recipients’ living standards.
 
Currently, nearly 4.5 million Vietnamese people are living and working in over 100 countries and territories around the world.
In 2000, Vietnamese expatriates sent US$1.75 billion to the homeland, which increased 117 percent to $3.8 billion in 2005.
 
The volume continued climbing to $8 billion in 2010. Also that year, Việt Nam was ranked the 16th global recipient of remittances by the World Bank, and it was ranked the second in Southeast Asia after the Philippines.

In 2013, Việt Nam entered the top 10 recipients of remittances with $11 billion. The country was ranked third in Asia and 11th in the globe in attracting remittances in 2015, with over $13.2 billion.
 
From 2002-2015, the flow of remittances was equivalent to 6 per cent of the nation’s gross domestic product (GDP) and nearly equivalent to foreign direct investment (FDI), which made up 7.7 per cent of GDP. It doubled official development assistance (ODA) capital, which accounted for 3 per cent of GDP.
 
After a slight decline, the volume of remittances transferred to the country reached about $9 billion in 2016.
Over 70 per cent of remittances are poured into production and business, while 20 per cent are injected into real estate.

The remittances have helped Việt Nam have a stable source of foreign currency earnings, increase the national foreign currency reserves and reduce its dependence on foreign capital and the pressure of the US dollar exchange rate.

HCM City leads the nation in remittance attraction. According to the State Bank of Việt Nam’s branch in HCM City, around 50 per cent of remittances transferred to Việt Nam go to the southern metropolis.

The city received about $5.5 billion from remittances in 2015, a year-on-year rise of 10 per cent. The figure dropped to $5 billion in 2016.

In addition, over 80 percent of the nation’s 1,100 overseas Vietnamese-invested enterprises are operating in HCM City.

Binh Dinh to develop textile industry to global standards
     
Phan Cao Thang, Permanent Vice Chairman of Binh Dinh People’s Committee, has authorised a plan to develop the province’s textile industry till 2025 with orientations to 2035.

The key objectives of the plan are to build Binh Dinh’s textile industry into a key economic driver and one of the province’s chief high-quality export suppliers, to slowly synchronise production from input to output and to implement a global standard environment management system.

Binh Dinh aims to become the central coastal region’s textile centre and to enhance the national textile industry’s performance and competitiveness within the region and the world.

Between 2016 and 2020, the province is determined to increase growth in the textile industry’s production value to around 17.8 per cent. By 2020, the provincial total production value for the textile industry hopes to reach VND3.95 trillion (US$178.2 million), double that of 2015. Between 2016 and 2020, the region aims for a total export value of $495 million and new employment for 18,800 workers, up by 4,800 jobs compared to 2015.

From 2021 to 2025, Binh Dinh province’s textile production value hopes to increase 13 to 14 per cent each year with the industry’s total value reaching VND7.4 trillion to VND7.8 trillion, total export turnover at VND780 million, up by 1.6 times compared to the period from 2016 to 2020 and create employment for 22.000 to 23.000 workers, up by 3.800 to 3.900 jobs from the previous phrase.

Key products for the period 2016 to 2020 and 2021 to 2025 will include tracksuits, children’s clothing, business suits, dresses, uniforms and protective gear. Production quantity aims to increase to 51 to 53 million units in 2020 and up to 64 to 65 million units in 2025. As of 2016, Binh Dinh’s textile industry had produced 20 million units. Suits and uniforms had increased by 14.2 per cent, whereas knitwear increased by 312 per cent compared to the same period in 2015.

In order to achieve these goals, the province has invested in the textile industry to support diversified production that can transition from simple manual labour to complete production chain vertical integration.

$10b pact to develop gas-powered plants signed
     
Affiliates of oil and gas giants PetroVietnam (PVN) and ExxonMobil on Friday signed a US$10 billion framework agreement to build a power plant using natural gas extracted from the Ca Voi Xanh (Blue Whale) field in Quang Nam Province.

The PetroVietnam Exploration Production Corporation (PVEP) and ExxonMobil Viet Nam signed the project agreement in Ha Noi in the presence of Deputy Prime Minister Vuong Dinh Hue.

The two companies also signed a gas and power selling contract.

Speaking at the signing ceremony, Deputy PM Hue appreciated efforts made by PetroVietnam and its US partner since they signed a production sharing contract (PSC) in 2009, including the completion of the latest framework agreement.

He said that to ensure comprehensive development of the Blue Whale gas and electricity complex, the Government and concerned ministries will direct national power utility Electricity of Viet Nam Group (EVN) and the Viet Nam National Oil and Gas Group (PetroVietnam, PVN) to quickly reach a framework agreement on buying and selling electricity generated by the project.

EVN and PVN have also been tasked with selecting investors for four power plants that will be fuelled with gas from the Blue Whale field, Hue said.

“To achieve further success in the future, ExxonMobil and PetroVietnam need to continue efforts to pump the first gas flow by the end of 2023,” the Deputy PM said.

The development of the Blue Whale gas project is expected to be an important contributor to developing the central region and to supply power to the south. In turn, this would create a momentum for development of the national petrochemical industry and an impetus for local industrial development, contributing to national energy security and creating more jobs in the region, Hue said.

The framework agreement will lay a foundation for contractors to optimise the preliminary front end engineering design (Pre-FEED) and FEED work to achieve the project’s targets.

In the first phase, the project will supply raw gas for four gas-powered plants with a total generation capacity of 3,000 megawatts. Two of the plants will be located in the Chu Lai EZ in Quang Nam Province and two others in the Dung Quat EZ in Quang Ngai Province.

Gas production during the expansion phase will provide enough fuel for the fifth power plant with a capacity of 5,750 megawatts. The total investment for the project is estimated at $10 billion and it is expected to contribute nearly $20 billion to the State Budget. 

BIDV wins Best Retail Bank award
     
Bank for Investment and Development of Viet Nam (BIDV) received the Best Retail Bank award for the third consecutive year in Ha Noi on Thursday.

The award, given by financial services company The Asian Banker, honours retail banks for their efforts and achievements in providing financial products and services to individuals, as well as for their position in the market. Typically, banks winning the title have impressive business strategies in the retail sector.

BIDV also won the award for the Best House Lending Product in 2016, based on criteria such as market share, outstanding balance scale, number of buyers, net income, credit quality and procedures.

The bank has been building financial products and services for around 9 million individual customers. It has expanded to around 1,000 transaction points nationwide, all as per international standards, has 32,000 ATMs, 1,000 agents worldwide, and representative offices in Laos, Cambodia, Myanmar, Russia and Czech Republic.

BIDV’s total assets rose 17.5 per cent year-on-year in 2016 to touch around VNĐ1 quadrillion (US$44 billion). Its assets currently account for 14 per cent of the total assets of the entire banking sector, bringing it to the top in terms of operational scale.

Last year, BIDV’s pre-tax profits reached VNĐ7.5 trillion, up 7 per cent year-on-year.

Local investor agree strategy deal with foreign partners
     
The Empire property investor has inked a strategy co-operation deal with Dream Hotel Group of the US and Louvre Hotels Group of France for Empire hospitality management in Viet Nam.

Deputy General Director of Empire Group, Trinh Viet Hung said the agreement will help the group operate hospitality projects in Viet Nam.

He said it’s also the first strategy agreement in hospitality between a local hospitality investor and world brand management partners.

The Empire Group said the world brand hospitality operation will be applied for managing coastal Naman Hospitality in Da Nang.

Last year, the local group started construction on the CocoBay project – the first entertainment-cum-hospitality complex in the central region – in Da Nang with total investment of VND14 trillion (US$622 million).

The Group aims to develop a series of entertainment and recreational centres, resorts, condotels, and a conference centre, in addition to a park and opera house including the Coco Ocean Resort near the Montgomerie Links and Da Nang Golf Club.

Tourist real estate remains a popular investment in the central city, attracting 25 foreign direct investment projects worth US$1.8 billion.

Da Nang has so far developed 16 tourist property projects, consisting of 749 villas, of which 609 are for sale and 140 for lease.

Five-star hotel opens in Buon Ma Thuot
     
The Muong Thanh Hotel Group officially opened a five-star hotel in Buon Ma Thuot City, the central highlands province’s capital, to serve tourism development in the province.

It’s also the 47th hotel and resort that the biggest private hospitality group in Viet Nam has developed in the country.

The group said the Muong Thanh Luxury Buon Ma Thuot hotel comprises 233 rooms and conference halls to accommodate more than 1,000 visitors at a time.

The opening of the hotel will help boost eco-tour services in the province including Lak Lake, Dray H’Linh waterfall, and the national Buon Ma Thuot Coffee Festival in the city on March 8-13.

In 2013, the group opened the VND400 billion (US$19 million) Muong Thanh Da Nang hotel in Son Tra Peninsula in Da Nang.

In 2015, the group also introduced a four-star hotel on Ly Son Island, 30km off the coast of Quang Ngai province, as part of its 2020 tourism development plan.

In 2016, the hospitality group also launched its first international hotel: the five-star Muong Thanh Luxury Vientiane Hotel in Laos.

According to latest reports, the Muong Thanh Group is developing 50 hotel projects to provide 6,000 rooms nationwide, which will account for 10 per cent of the country’s tourist accommodation.

As scheduled, the group will introduce a series of hotel chains in Bac Ninh, Ha Nam, Phu Tho, Nha Trang and Da Nang later in 2017. 

Securing market stability during Tet

The Ministry of Industry and Trade has issued a Decree introducing solutions to secure market stability during the traditional lunar New Year.

Departments of Industry and Trade in cities and provinces are requested to help enterprises access preferential credits and consume their products.

Hanoi’s Department of Industry and Trade implemented a plan to stock commodities to ensure sufficient supplies for the people during Tet. By evaluating market demands and purchasing power, local enterprises have prepared to serve consumers. 

In the markets, commodities worth more than VND680 billion are available to fulfill the Tet demand. This year, the Department of Industry and Trade will sell Tet goods at 20 shopping malls, 119 supermarkets, 454 markets, and approximately 1,000 stalls and convenient shops around the city.

In Gia Lai province, enterprises have increased their commodity fulfillup to 50% to serve the Tet demand. Prices are listed openly. Thanks to incentives, prices will remain stable during the Tet holiday. 

"We always want to give our customers the best products. We have cooperated with prestigious companies to have high-quality products to serve local customers", said Phan Thi Thuy Dung, a trader in Pleiku City, Gia Lai province.

"We have also had access to preferential bank loans with low interest rates which enabled us to buy a large volume of goods to serve our customers”,  she added.

In Danang, enterprises reserved commodities worth more than VND150 billion to meet the demand during Tet. The Co.opmart Danang Company has opened stalls in Hoa Phu and Hoa Ninh communes of Hoa Vang district.

 "The municipal Department of Industry and Trade has implemented a plan to stabilize the market during Tet. Supermarkets, shopping malls, wholesale markets and the enterprises have prepared sufficient goods for Tet", Nguyen Ha Bac, deputy director of the Danang Department of Industry and Trade said.

The Binh Dinh Provincial People’s Committee has provided more than VND31 billion for enterprises in an effort to stabilize the Tet market.

FTAs: Opportunities and challenges for Vietnamese businesses

In 2016 Vietnam signed several new bilateral free trade agreements and began to implement some signed FTAs.

Government agencies and the business community are gearing up to take full advantage of these deals.

Vietnam has signed a number of bilateral and multilateral free trade agreements, completed negotiation of an FTA with the EU, and is negotiating the Regional Comprehensive Economic Partnership. 

Vietnam is also negotiating the ASEAN-Hongkong FTA and bilateral FTAs with Cuba and Israel. In 2016, Vietnam became a member of the ASEAN Economic Community and started implementing an FTA with the Eurasia Economic Union. 

Vietnam’s international integration has expanded from goods to services, including finance, investment, state-owned enterprises, and Government procurement.

The Government last September announced 10 special preferential import tariff rates while the Finance Ministry has implemented or is creating roadmaps for import tariff commitments. 

Vietnam has cut more than 8,500 or nearly 90% of its tariff lines on imports from the Republic of Korea.

“Vietnam is committed to opening its retail market. We are designing a strategy for the retail industry for 2017 with a vision until 2025 and completing appropriate and legitimate technical barriers to protect domestic products,” said Minister of Industry and Trade Tran Tuan Anh.

FTAs have put increasing pressure on domestic businesses. A 2016 survey by the Vietnam Chamber of Commerce and Industry showed that 88% of Vietnamese businesses have plans to improve their performance by raising product quality, applying advanced technologies, and expanding markets to tap the full potential of FTAs. 

Experts say that understanding FTA commitments, particularly to open markets, is a prerequisite for seizing opportunities and handling challenges effectively.

“During integration, Vietnam has realized that internal strength is vital for development. We must reinforce the strength of the national economy and domestic businesses because no country can develop relying merely on external resources. Integration is worthwhile only when it makes Vietnam stronger,” said economist Pham Chi Lan. 

Vietnamese seafood exporters scammed in payment fraud schemes

Industry group VASEP has asked its members to stay vigilant against potential letter-of-credit scams that could cost them thousands of dollars.

The Vietnam Association of Seafood Exporters and Producers (VASEP) has issued a warning to alert its members to possible payment scams.

The warning came after Vinh Hoan, a major seafood producer in the Mekong Delta province of Dong Thap, reportedly became the latest victim of professional scammers.

The exporter entered into an agreement with Cairo-based Al-Reda Group in 2015 to deliver seafood shipments worth a total of US$58,800 through a letter of credit.

Since it successfully delivered the shipments, Vinh Hoan has not been able to collect the money from the buyer, who allegedly faked documents to convince banks that the seller has failed to ship goods.

In its warning, VASEP blacklisted Al-Reda Group.

“Members should be cautious in entering into contracts with this company as well as with other foreign partners to avoid such payment risks,” said VASEP.

It is not immediately clear what legal support the association will offer to its scammed members.

A few Vietnamese seafood exporters are facing the possibility of losing hundreds of thousands of dollars in a similar scheme linked to a Quebec-based importer and a bank based New Zealand. VASEP suspected that the buyer may have colluded with the bank. 

Official figures showed that Vietnamese exporters lost around US$8 billion due to payment fraud in 2015.

Although letters of credit are considered to be the best payment option for many traders, local exporters have been advised to take extra caution with new buyers from overseas.

Beer-thirsty Vietnamese force supermarkets to ration sales before Tet

Panic-buying has ensued with prices expected to rise ahead of Tet.

With people buying up beer in bulk ahead of the Lunar New Year celebrations, a rationing system has been put in place by many supermarkets in Ho Chi Minh City.

When Hanh, a regular at a supermarket in District 2, noticed supermarket staff busy stacking piles of crates of beer, she decided to buy a few just in case beer prices go up before the Tet holidays.

“I bet the price will be even higher next week,” said Hanh “ Just three weeks ago, a crate of Heineken beer only cost VND350,000 (US$15) but now the price tag reads VND397,000 (US$18).”

Hong, the owner of a convenience store in Go Vap District, forecast a surge in demand over the next few weeks.

“Demand has increased at speed in the past few days,” Hong said, attributing the surge to people buying beer as holiday gifts for relatives, colleagues and friends.

This thirst has also forced many restaurants in Ho Chi Minh City to put in place a rationing system, limiting the number of cans a customer can buy per visit.

In an attempt to prevent hoarding, a supermarket chain has even put up a notice asking customers to buy no more than two crates of beer.

However, major brewers told VnExpress that the supply is ample.

“We confirm there have been no changes to our prices. Our stock is enough to satisfy the market demand, which might increase by about 20%,” said a Heineken communications officer.

Japanese brewer Sapporo said it has increased output by 20% from the same period last year to quench the thirst.

Vietnam’s beer market is projected to grow about 40% by 2019, according to Euromonitor.

Over the past five years, Vietnam has doubled its beer consumption to more than 3 billion liters per year. Each Vietnamese person drank on average 27.4 liters, making them the heaviest beer drinkers in Southeast Asia, the third in Asia and in the world’s top 25 heaviest beer drinkers.

Foreign beer giants are aggressively pouring money into Vietnam.

Dutch beverage Heineken has identified Vietnam as the next key driver for its growth in Asia Pacific and is pouring money into the country, which is second only to Mexico in terms profitability, said the company’s Asia Pacific President Frans Eusman.

Japanese brewer Sapporo, which started tapping into Vietnam’s beer market in 2010 by acquiring a local company in a deal worth US$8.28 million, is aiming for a 70% increase in the number of local stores and restaurants carrying its premium brew.

Thai transnational investors look favourably upon Vietnam

Vietnam is considered a favourable and important destination in the ASEAN region for Thai transnational companies to invest and do business, say leading economic experts from both countries.

Recently, Thai transnational companies have focused on industrial infrastructure and retail distribution.

The experts say Thailand and Vietnam share close geographic proximity and cultural similarities and as a result Thai businesses have minimal difficulties operating businesses in Vietnam.

The two countries have also worked closely at regional and international forums to simplify and streamline the process of operating businesses in each other’s economies as well as the ASEAN region.

The Ministry of Planning and Investment in turn says Vietnam hopes Thai businesses will increase their investment in potential fields like infrastructure, construction, consumer products, food, automobiles and agriculture in the future.

Hoa Sen Group plans large-scale restructuring

At its recent shareholders’ meeting, giant steel maker Hoa Sen Group (HoSE: HSG) received approval to restructure the company in the parent and subsidiaries model.

Specifically, HSG is going to establish joint-stock subsidiaries for different regions. The parent company will hold at least 51 per cent in these companies, while the remaining stake would be auctioned among interested investors.

HSG is going to transfer the ownership of all plants and assets to its regional joint-stock subsidiaries. After a while, these subsidiaries are going to be listed on their own.

According to HSG’s annual report for the 2015-2016 fiscal year, the company’s output reached 1.24 million tons, up 22 per cent since last year. Meanwhile, revenue was VND17.9 trillion ($778 million), up 2.6 per cent on-year. 

After-tax profit was VND1.5 trillion ($66.5 million), up 130 per cent from the last fiscal year. HSG is leading the domestic steel and zinc-coated steel markets, while expanding internationally with distribution channels spanning 65 countries and territories, earning nearly 40 per cent of its revenue from exports.

For the 2016-2017 fiscal year, HSG targets VND23 trillion ($1 billion) in revenue, sales of 1.57 million tons, and after-tax profit of VND1.65 trillion ($73.1 million).

Established in August 2001, HSG is a leading steel manufacturer in Vietnam and Southeast Asia. The group makes about 40 per cent of all domestic steel sheets. 

In 2016, HSG started building two million-dollar steel plants and added a mega project to the pipeline. 

In January, HSG started the construction of the 12.4-hectare Hoa Sen Nhon Hoi factory in Nhon Hoi Economic Zone in the central province of Binh Dinh. The facility is expected to commence operation in June 2017 and supply 180,000 tonnes of galvanised steel sheets and zinc-aluminium alloys, 90,000 tonnes of colour-coated steel sheets, and 200,000 tonnes of cold-rolled steel units on an annual basis.

In March, it started construction of the 20.4-hectare Hoa Sen Ha Nam steel factory (capitals?), an investment of $134.3 million in total, which will have an annual capacity of over 800,000 tonnes on completion.  Located in Kien Khe Industrial Cluster in the northern province of Ha Nam, it began construction in March and will be completed in September 2018. 

In August, Hoa Sen was approved to build a giant steel complex with a capacity of 16 million tonnes a year in the south-central province of Ninh Thuan. At a cost of $10.6 billion, the plant will be the largest steel plant in Vietnam and will be built from 2017 to 2031 in five stages. The first stage is expected to begin operation in 2019 with an output of 1.5 million tonnes of steel a year.

Many experts have voiced concerns over the project, saying that there is already a global surplus of steel and that the project is likely to cause environmental pollution, especially after the environmental disaster caused by Formosa’s $10.5-billion steel complex in Ha Tinh.

VinaCapital, one of Vietnam’s largest asset management companies and owner of a 0.5 per cent stake in Hoa Sen Group, said if Hoa Sen went ahead without proof of satisfactory environmental protection measures, it would reconsider continuing to hold shares. Meanwhile, Hoa Sen defended the project with promises to use modern, eco-friendly technologies as well as waste treatment and recycling systems. Officials pointed to the estimated 45,000 jobs the project offers and promised to be stricter in evaluating its environmental impact.

Eight “Made in Vietnam” cargo container cranes arrive safely in Saudi Arabia

Eight rubber tired gantry cranes (RTGC) made by the skilled Vietnamese engineers and technicians at Doosan Vina have arrived safely to Saudi Global Port (SGP) in Dammam City, after 20 days of transit from Doosan Dung Quat Port in Vietnam.

The eight cranes weigh 1,240 tonnes in total and each one is 29 metres high, 27.6 metres long, and 5.6 metres wide.

They can safely and efficiently move, load, and unload standard 40-tonne cargo containers.

This project was signed between Doosan Vina and SGP in March 2016 and the design, manufacture, and assembly took eight months to complete.  With this handover to SGP, Doosan Vina has supplied 65 “Made in Vietnam” cranes to domestic and international customers.

Govt caution seen in SOE restructuring effort

A new decision has shown the Government’s caution to restructure State-owned enterprises (SOEs) in the coming years, especially those in the sectors where full State ownership is not needed.

The caution is reflected in the decision on criteria for the classification of SOEs and businesses with State holdings as well as a list of SOEs subject to restructuring in 2016-2020. The decision was issued to replace Decision 37/2014/QD-TTg.

Questions have been raised for the 103 enterprises whose entire chartered capital is held by the State for reasons like social security as the State does not need to retain this. They consist of 13 firms in the publishing sector, two housing management and development firms in Haiphong and Hanoi, Bien Dong Seafood One-Member Co Ltd and Yen Sao Khanh Hoa One-Member Co Ltd.

There are concerns that the performance of the enterprises would be affected if the State wants to retain full ownership because private involvement is expected to help improve their efficiency. The State should clarify the reasons and benefits for its entire control over the SOEs.

The decision says the State will hold 50-65% of the chartered capital of 27 enterprises including the Northern Food Corporation (Vinafood 1), the Southern Food Corporation (Vinafood 2), the Vietnam National Coffee Corporation (Vinacafe) and nine firms active in the environment, water supply and drainage and other sectors after they go public.

The food wholesale sector has been opened up to private firms and the Ministry of Industry and Trade’s recent move to do away rice trading and export conditions is clear evidence. In other words, the State’s management and intervention through SOEs in this sector has been lessened so retaining the State’s controlling stakes in the two corporations is unnecessary.

Notably, Vinafood 2 is one of the SOEs with poor performance and other problems as it has reportedly racked up big losses in recent years. Therefore, it is likely that the State’s majority stake in the corporation would do more harm and good for the State budget since as a major shareholder the Government will have to fund its losses after its equitization. 

Experts have cast doubt on the State’s owning a controlling stake in Vinacafe as well as the nine entities in the environment, water supply and drainage sectors because the State holds stakes of less than 50% in other enterprises in the same sectors in line with the decision. 

GPBank, Vietnam Construction Bank (VNCB) and Ocean Bank, the three cash-strapped commercial banks which were wholly acquired by the State Bank of Vietnam at VND0, are among the 103 enterprises. According to the decision, all these banks will be under the direct management of the Government in the 2016-2020 period, suggesting that the restructuring of these banks would remain a daunting task in the coming years.

Minister warns of widening gap between VN and regional countries

Minister of Planning and Investment Nguyen Chi Dung has warned the development gap between Vietnam and regional nations will continue widening if no drastic reforms are taken right now.

“It will take Vietnam up to 16 years to catch up with Thailand’s current development pace,” he told a 2016 review conference of the ministry. “Vietnam is also lagging behind the Philippines and the development gap between the two cannot be narrowed anytime soon.”

Dung was quoted by Dan Tri news website as saying that the economy is grappling with a host of bottlenecks, especially those related to the administration, human resources and the old way of governance while the world is changing swiftly.

“The long-unsolved problem that has been haunting the country is growth has not matched potential. The risk that the nation will fall into a middle income trap is in sight,” Dung warned.

He called for urgent solutions to those pressing issues. In Vietnam, growth has long been fueled by expansionary policies, cheap labor and natural resources, he noted.

Vietnam, he said, is no longer a poverty-stricken country but it would be a long way for it to become rich.

It took the country 25 years to be recognized as a lower middle-income economy, he said, and the nation will need a longer period of time, 30 to 50 years, to reach the upper middle-income status.

Planning and investment authorities should have a strong desire to make improvements and carry out reforms, he urged. “There’s no place at the ministry for anyone who keeps reform plans in low gear.”

In ASEAN, Vietnam is currently ranked sixth in economic terms, seventh in per-capita income and fifth in competitiveness. However, Minister Dung said the countries higher up in the rankings will not let Vietnam catch up and those countries in lower rankings are speeding up reforms to outperform Vietnam.

Satra to build two commercial centers

Saigon Trading Group (Satra) will commence construction on two commercial centers in HCMC in the second and third quarters of this year, the firm said at a review conference on January 12.

Ngo Viet Hung, head of Satra’s retail chain Satramart, said work would start in quarter two on Centre Mall covering 12,000 square meters in Trung An Commune, Cu Chi District. A similar facility will get off the ground on Vo Van Kiet Avenue, District 6 in the third quarter.

Hung said the two centers are part of Satra’s plan to expand its retail network. This year, Satra will open 55 Satrafoods stores, including 10 in the Mekong Delta city of Can Tho. 

He said the company would consider franchising its stores to shore up its retail network and improve operation efficiency.

Satra deputy general director Tran Van Bac said at the conference that the company attained revenue of VND55.26 trillion (US$2.4 billion) in 2016, representing 111.5% of the full-year plan, and profit of some VND11.09 trillion, 121.8% of the plan.

It earned export revenue of US$110.34 million last year with major export earners including processed food, rice, seafood and fish oil. Key export markets of the firm were Asia, Europe and the U.S.

Can Tho seeks to set up tourism department

Can Tho City is seeking Government approval for a proposal to establish a tourism department by separating the Department of Culture, Sports and Tourism.

Le Minh Son, deputy director of the department, told the Daily on the sidelines of a review conference on Wednesday that the proposal for setting up the tourism department had been sent to the central Government through the Department of Home Affairs of Can Tho.

A separate tourism department would help enhance the management and promotion of tourism, Son said.

Can Tho’s tourism sector revenue reached VND1.8 trillion (US$80.4 million) last year, 30% above the full-year target. The city received 5.3 million visitors, a year-on-year rise of 14%, with over 590,200 of them international tourists.

Tourism project gets green light

Trung Thuy Group Corporation has got the green light from the HCMC government to develop a tourism project on the Tau Hu-Ben Nghe Canal.

Duong Thanh Thuy, chairwoman of the corporation, said the project would require some VND150 billion (US$6.65 million).

The investor would use eight 25-meter-long ferries to set up a recreational site on the canal. The site would be divided into smaller sections presenting the past and present features of Saigon, such as coffee shop, famous persons, street food and public activities. The area could accommodate around 1,500 tourists at a time. 

The company is working on a model ferry which will be shown to the city government for consideration before starting construction, Thuy told the Daily.

The project is expected to start service on September 2, National Day.

The corporation introduced the project to the city government at a conference on the development of the city’s river tourism in November last year.

Nguyen Thanh Phong, chairman of the city, has asked the tourism department to work with the firm over the project.

Waterway tourists in the city had numbered 257,684 as of the third quarter of last year, up 11,5% compared to the same period a year earlier, according to data of the HCMC Department of Tourism.

Long Thanh airport terminal designs displayed for comment

The Airports Corporation of Vietnam (ACV) is displaying designs of the Long Thanh international airport terminal at the HCMC Exhibition House until January 23 to collect more comments from the public in the city.

The corporation already showcased the designs in Hanoi, the central coast city of Danang and the southern province of Dong Nai to garner public comments on the terminal designs of the airport in Long Thanh District, Dong Nai.

The National Assembly allowed the Government to proceed with the project in June 2015, which is believed to become an aviation hub in the region.    

The project will be developed in three phases. A runway and a terminal for 25 million passengers and 1.2 million tons of cargo will be built in the first phase scheduled for completion in 2025 at the latest.

One more runway and one more terminal will go up in the second phase and the airport’s capacity will rise 50 million passengers and 1.5 million tons of cargo. When phase three is done in 2050, the respective figures would increase to 100 million passengers and five million tons of cargo. 

The Long Thanh project would cost a total of more than US$16 billion, with around US$5.45 billion of it going to phase one.

The Prime Minister requested ACV to use its development fund to map out the feasibility study for the airport in phase one.   

In the first round of an architectural competition, the organizing committee received nine designs of the terminal from 16 consulting firms that have got involved in megaprojects that are similar in scale to Long Thanh airport.

As requested by the Government and the Ministry of Transport, ACV has been displaying the designs for organizations and individuals before the best one is picked for the feasibility study of the airport.

In addition to the exhibitions, ACV is also consulting industry associations including the Vietnam Architects Association, the Vietnam Urban Planning and Development Association, the Vietnam Construction Association, and the Vietnam Association of Aviation Science and Technology.

These designs are also available on the ministry’s portal at www.mt.gov.vn for public comment.

Tet goods increase from 10 to 15 percent

The Ministry of Industry & Trade said goods for Tet this year increase from 10 percent to 15 percent over the previous years.

The essential goods in the Tet holiday are much more diversified including candy, beverage, milk, fresh products…

It is forecast that purchasing power in the Tet holiday will also increase from 8 to 10 percent compared to last year.

The Ministry asked localities, enterprises actively check the supply and demand of Tet goods, building the plan to serve the biggest festival of the year, implementing the market stabilization program to introduce Vietnamese products to rural areas, mountainous region and island districts.

The ministries of Industry & trade and Agriculture & Rural Development are boosting clean agro products to meet people’s demand in the Tet holiday.

Industry and Trade Ministry manages prices of 877 infant formula products

The Ministry of Finance on January 13 handed over documents relating to management of 877 formula milk products for children of less than six years old to the Ministry of Industry and Trade.
 
The Domestic Market Department under the Industry and Trade Ministry will be responsible for price management to these products.
 
At present, the country has 877 registered formula products for children of below six years old. Their registered and maximum prices are publicized in the portals of the Ministry of Finance and local financial departments.
 
Since June 2014, baby formulas have been taken in the list of subsidized products with a cap on ceiling prices of 600 products. The difference between retailed and wholesale prices has not exceeded 15 percent.

Nearly 100 percent businesses do e-tax declaration

HCMC Taxation Department has said it will continue administrative reform as well as tax management modernization this year, maintaining the ratio of businesses doing online tax declaration of over 99 percent and online tax payers of over 94 percent.

In addition, the agency will connect with the Department of Natural Resources and Environment to manage land documents and increase information exchange with HCMC Customs Department.
 
Tax agencies’ electronic mailbox will be sustained for businesses to inform and get guidance of new tax policies in a timely manner as well as tax procedure problems.
 
This year, the tax industry strives to reach the total revenue of VND238,882 billion (US$10.56 billion) or VND226,482 billion excluding crude oil.

Last year, revenue hit VND203,236 billion ($8.98 billion), accounting for 103.8 percent estimates and up 10.48 percent over 2015.
 
Of three main taxes in the economic field, special consumption tax posted the highest revenue increase with 45.52 percent.
 
The achievement was thanks to tax rate hikes in beer, wine, cigarette and automobiles of less than nine-seater with cylinder capacity of from 2,000 cubic meters and more. These commodities contributed up to 90.5 percent of total special income tax.
 
Value added tax went up 13.62 percent over the previous year and corporate income tax surged 9.59 percent.

Other incomings also saw a high increase such as personal income tax rising 14.5 percent, land and water face rent 67.52 percent, state own house sales 46 percent.

So far 99.37 percent businesses have registered to pay tax online.

Catfish exporters warned over unreliable export partners

The Vietnam Association of Seafood Exporters and Producers (VASEP) has warned local companies against trade fraud with an Egyptian company.
 
Eygpt-based Al-Reda Group For Trading and Development bought USD58,881 of frozen catfish from Vinh Hoan Company in June 2015. However, they have never paid for the goods.
Vinh Hoan is one of Vietnam's leading catfish exporters. Their turnover reached VND7.2trn (USD318m) last year, an increase of 11% on previous year. The post-tax profit of the mother company was VND550bn, an increase of 70% compared to same period last year.
However, Vinh Hoan and many other local companies are having problems with foreign partners. Several aquaculture companies have been tricked by Canadian firm Echopack Inc. and may lose hundreds of thousands of USD.
Firms are advised to be careful about the credibility of foreign partners, especially if they are introduced by a third party.
Firms can search for information via open sources or hire other firms such as the National Credit Information Centre of Vietnam or through overseas associations to find out more about their partners. As contracts are used to solve disputes, firms must understand their contract terms in order to ensure their interests.
Local firms are advised to consider using banking service as another protection.

Disbursement of housing stimulus on time
     
The disbursement of the housing stimulus package, valued at VND30 trillion (US$1.4 billion) in preferential loans, will finish on schedule, according to the State Bank of Viet Nam (SBV).

SBV’s statistics showed that, as of the end of November, VND29.239 trillion had been disbursed, with outstanding loans remaining at VND24.116 trillion.

The disbursement is now being hastened and will finish by the end of this month.

The central bank said the housing stimulus package significantly contributed to the recovery of the property market, reducing stockpiles, removing difficulties for developers, as well as for the recovery of the economy.

Of note, the package enabled more than 50,000 households to purchase affordable homes.

Nearly 86 per cent of the preferential loan package was provided to buyers. Disbursements for buyers are to continue until the end of the year, though disbursements ended for developers on June 1.

A total of VND5.395 trillion from the package was provided to developers.

The housing stimulus package began on June 1, 2013, with the aim to encourage development and purchase social housing projects and affordable homes, providing impetus to the stagnant real estate sector.

Disbursements from the package were previously scheduled to finish by June 1, but due to disappointing results the Government extended the deadline until the end of this year.

After the VND30 trillion package, the property market was still awaiting new loan packages for social and affordable housing.

In June, the Prime Minister decided upon a preferential lending interest rate of 4.8 per cent for social housing purchases, to be offered by the Bank for Social Policies by December 31. Although the deadline nears, preferential loans remained inaccessible due to the shortage in sources of capital.

MoIT to tighten control on fertiliser, petroleum markets
     
The Ministry of Industry and Trade (MoIT) will tighten control over the fertiliser and petroleum markets in 2017 to limit fake products and frauds.

The market watch department will conduct regular checks on all producers, importers and traders to ensure that regulations related to business registration, business conditions, quality of inorganic fertilisers, labelling, bills and the distribution system are being followed.

There will also be inspections on the implementation of regulations under Decree No. 83/2014/ND-CP on petrol trading.

During the 14th National Assembly session last month, MoIT minister Tran Tuan Anh said authorities would strengthen their fight against the counterfeit fertiliser market and build a legal framework on standards for sustainable development of the sector.

The fertiliser market has a potential value of US$2 billion and brings huge profits, which is why there are so many fake products. These not only have a harmful effect on crops, environment and people’s health, they also affect the reputation of genuine products.

Statistics from the ministry’s chemical department shows that the country has around 800 fertiliser producers. Counterfeit fertilisers have caused losses to the country’s agricultural production and economy to the tune of VND60 trillion (US$2.64 billion). 

Programme for safe food start-ups unveiled
     
The Viet Nam Social Work Centre for Adolescents yesterday signed an agreement with C.P.Viet Nam Livestock Corporation and a social enterprise, Development Sharing Foods Viet Nam, to organise a programme to provide assistance and practical training to young people who want to start up food businesses.

After the training the start-ups will be franchisees of CPFoods.vn’s safe food chain, which opened its first store yesterday in HCM City’s Binh Thanh District.

The chain, which sells meat and poultry products, uses food with clear origins to feed livestock while its production processes meet food safety and hygiene standards.

Cao Hong Hung, the centre’s head, said through the programme more and more safe food start-ups would be set up in the country to mitigate fears about unsafe foods. 

Strengthening protection for agricultural products

Doan Hung pomelos, Vinh oranges, Buon Ma Thuot coffee, Tan Cuong tea and Cat Loc mangoes are some of the agricultural products that have not only brought in high economic benefits to their producers but also been given protection by law over the past ten years.

Under pressure to protect and promote the brands of their goods, agricultural producers have recently started paying more attention to intellectual property protection. 

Aware of the importance of brand protection to combat against fake products, some localities with famous agricultural products have begun taking necessary steps to file for intellectual property protection, build geographical indications to enhance the value of their products and protect the legitimate rights and benefits of producers.

Vietnam is rich in tropical agricultural products and almost all localities boast some kind of specialty. In recent years, brand building for agricultural products has achieved certain results at a time when Vietnam is integrating deeply into the global economy. 

Nevertheless, many producers, enterprises and localities still pay little attention to intellectual property protection for their agricultural products and few Vietnamese agricultural products are known internationally.

An official survey shows that the majority of Vietnamese agricultural products are exported under foreign brand names. 

Only about 50 geographical indications and 140 brands are registered and protected and only a few of them have been registered for protection abroad. Among about 900 products associated with 700 geographical locations, up to four fifths do not have any branding.

The indifference to brand protection stems from small-scale agriculture; a limited capacity of enterprises; loose connection between local authorities, farmers and enterprises; and producers’ limited trading and marketing skills. In addition, local authorities and farmers are not fully aware of the importance of market development and brand protection while consumers are increasingly demanding more information about the origins of products they are buying.

Geographical indications help increase the value of products and boost local economic development. Furthermore, a product whose origin can be traced will be more competitive. 

However, currently there are still many difficulties when building geographical indications. Some say the largest obstacle is a lack of a common legal framework in managing geographical indications. 

As such it is necessary for the competent authorities to reform geographical indication registration and management. More importantly producers should make efforts to enhance the quality and appearance of their agricultural products to improve their competitiveness and win over consumers’ trust.

Vietnam evaluates trade, investment opportunities in Myanmar

The outlook for the Myanmar market looks good— showing high potential for Vietnam exports and investment, said Bui Huy Son, director of the Vietnam Trade Promotion Agency.

He made the comment in a speech at the opening of a 4-day trade fair running through December 25 showcasing Vietnamese commercial goods at the Tatmadaw Hall in Yangon, Myanmar.

Vietnamese companies and investors should seize the export and import opportunities in construction, agriculture, pharmaceuticals, hospital-healthcare, manufacturing, IT-technology, oil & gas as well as mining and energy, he noted.

Vietnam Ambassador to Myanmar Luan Thuy Duong in turn unveiled plans to organize several additional exhibitions and conferences in Yangon and Mandalay in Myanmar next year, saying the other exhibitions and conferences are awaiting approvals and are in the planning stage.

In the conferences, Ambassador Duong told the audience that Vietnam will have excellent speakers including ambassadors, senior government officials, lawyers, bankers, insurers and investors providing expert advice on trade and investment matters.

Popular brands participating at the trade fair in Myanmar include Vinamilk, Trung Nguyen, Eurowindow, Kangaroo, Sunhouse, Haiha-Kotobuki and Bitas.

Foreign investment could slow due to low localization

Commercial trade growth for the Asia Pacific Region slowed to 2.3% in 2015, far below the expectations of 2.7% that had been forecast, said the Asian Development Bank in a recently released report.

In the Asian Economic Integration Report 2016 the Bank pegged the region’s gross domestic product (GDP) rate for 2015 at 5.3%, which too fell well short of anticipated growth.

In the report, the Bank warned that foreign direct investment (FDI) inflows that it considers crucial to GDP growth may slow in the near-term on the back of rising protectionism sentiments around the globe.

“Rising protectionism has become an increasing concern to international trade prospects,” the report said, citing the number of anti-dumping complaints filed against the region’s exporters as evidence to support the assertion.

The report noted that the number of anti-dumping lawsuits filed had increased roughly 150% in the five years from 2011 to 2015, jumping by 98 in number from 181 to 279, respectively.

The Bank warned of a more challenging commercial trade and investment environment because of a movement away from globalization and free trade pacts to localization and bilateral trade agreements, which potentially it asserts could negatively impact regional integration.

“Recent political events – such as the Brexit vote in June 2016 and Trump’s victory in the US election – suggest a rising tide of anti-globalization and anti-establishment sentiment among parts of the electorate worldwide,” said the report.

“Despite an unfavourable external environment, developing Asia is expected to maintain 5.7% growth in 2016 and 2017,” said the report.

In dealing with the slow global growth, the Bank believes that greater commercial trade openness and investment can strengthen the region’s resilience, given that in 2015 the Asia Pacific attracted roughly one-third of total global FDI.

Per the report, the Asia Pacific region remained the world’s top FDI destination, having attracted US$527 billion in 2015, up 9% from 2014, while global FDI increased to a record US$1.8 trillion in 2015, with around 30% going to the region.

What this means for the domestic sector businesses in Vietnam is that they need to lay out an agenda to increase their localization rate in the global manufacturing supply chain, said experts at a recent business forum in Ho Chi Minh City.

Most importantly, the domestic sector businesses need to be laser focused on accomplishing the initiative, the experts underscored.

If FDI into the Asia Pacific region were to slow down as suggested— that would mean the domestic sector would face increased competition from their counterparts in neighbouring countries for fewer dollars, the experts noted.

They added that automobile giants such as Toyota, Ford and Honda have already announced they have excluded Vietnam from their expansion plans in the region due to its weak support industries and localization participation in manufacturing.

Citing reports by the Asian Development Bank, the experts pointed out, that only 21% of Vietnam companies have joined the local global supply chain compared with 30% of Thai and 46% of Malaysian companies.

The localization rate of the domestic sectors in the countries within the region will most likely become the number one controlling factor for transnational companies in making the investment decision of where to invest, the experts speculated.

A higher localization rate translates directly to lower costs for transnational companies for such items as transport, less money tied up in inventories of raw materials and intermediary goods, and all around less overhead costs, to name only a few of the savings.

The bottom line is that a low localization rate for the Vietnam domestic sector means lower profits for transnational companies looking to set up shop in the Asia Pacific region compared to other countries, resulting in lower FDI inflows, the experts concluded.

New golf centre breaks ground in Ha Nam Province

Town of Ba Sao officials along with representatives from Ha Nam Province joined representatives of Golf Truong An JSC at a ground-breaking ceremony today (Dec. 24) for a new golf centre.

The new 18-hole Kim Bang golf centre located in the town of Ba Sao is expected to be complete by the spring of 2018, said Truong An JSC reps at the ceremony.
  
The new facility will feature a double-decker driving range, community meeting spaces, practice putting green, practice pitching green, a practice bunker as well as lighting and lots of parking.

If all goes as planned, a second 18-hole golf course would be built on adjacent land and opened by 2020, they said. Combined, the entire facility would span 186.46 hectares with a total budget of more than US$44.69 million (VND1,000 billion).

Ba Sao officials in turn commented that the benefits that everyone in the community will have with this new property are incredible. This new facility will be state of the art, it’s an exciting project, they said, noting they can't wait until it’s finished.

Da Lat aims to become top vegetable producer in Southeast Asia

Local authorities of Da Lat city in the Central Highlands province of Lam Dong has approved a plan to turn the city into the top producer of vegetables in Southeast Asia.

The city also aims to become the number-one destination for agricultural tourism in Vietnam.

Accordingly, the city will develop comprehensive and sustainable high-tech agriculture and improve its investment environment in the 2016-2020 period.

The city hopes that high technology will be applied in 65-70 percent of its farming land areas, equivalent to 7,000 hectares.

The agricultural sector’s production value is expected to hit 4,346 billion VND (193 million USD), of which vegetable and flower exports account for 20 percent.

Besides, Da Lat city will develop sustainable agricultural models in combination with tourism and agricultural services.

Binh Duong’s industrial development index sees slight drop

The industry development index of the southern province of Binh Duong stood at 10.1 percent in 2016, down 0.2 percent year-on-year, reported the provincial Department of Industry and Trade. 

Amid difficulties and challenges, local enterprises had to work hard and actively organised trade promotion activities to maintain business and stable growth. 

In 2016, owners of industrial parks (IP) invested over 300 billion VND (13.2 million USD) in building technical infrastructure systems, the department said, adding that local IPs attracted over 1.6 billion USD in foreign direct investment (FDI), accounting for 85.8 percent of the total investment flow in the province.

The export value of enterprises operating in IPs and industrial clusters reached 11.8 billion USD, while their revenues hit 20 billion USD.

Sectors recorded the highest growth rates included water supply and wastewater treatment with 17.3 percent; electricity production and distribution, 13.3 percent; and mining industry, 10.4 percent. 

Meanwhile, the province’s key export staples such as electric equipment, leather products, and garment-textiles maintained stable growth rates, with respective rises of 18.8 percent, 8.6 percent and 6.7 percent. 

The local authorities approved projects to expand the Bau Bang and Cay Truong IPs, which are hoped to lure more investment and promote service and urban development in the locality.

Binh Duong is striving to increase its GDP growth rate to 13.3 percent in 2020 and turning itself into a key industrial centre, which will focus on developing the supporting industries, generating jobs for about 45,000 labourers. 

In 2017, the province will boost export to developing and regional countries along with expanding spearhead industrial sectors such electricity, electronics, telecommunications, mechanical engineering, chemical and processing industry, the department said. 

Binh Duong will give priority to producing high-tech and environmentally friendly products and those with high-added value.

Binh Duong’s export earnings reach 24.3 billion USD

The southern province of Binh Duong earned more than 24.3 billion USD from exports in 2016, up 16.4 percent from the previous year and making up 99.3 percent of the annual target.

According to the provincial Department of Industry and Commerce, domestic enterprises brought home 4.4 billion USD (up 11.2 percent) from exports, while foreign-invested firms raked in over 19.9 billion USD (up 17.6 percent).

The province’s staples, such as wooden products, textiles and garments, leather and footwear, have maintained their export growth, while rubber latex has bounced back in the last months of this year.

Nine out of 23 product groups have enjoyed rises of 10 percent upwards in export turnover. Meanwhile, export earnings of coffee and agricultural products, which dropped in 2015, have increased by 7 percent this year.

Binh Duong has successfully maintained its traditional export markets such as the US, the UK, Japan and ASEAN, with export orders going up by 5 – 10 percent as compared to 2015.

In 2017, Binh Duong expects to record a year-on-year growth rate of 15.7 percent in its export value by increasing trade promotions, expanding markets and offering incentives to businesses while diversifying export goods.

Experts welcome shift in credit policy for hi-tech agriculture

Experts have welcomed a shift in credit policy for hi-tech agriculture to include farmers and enterprises instead of focusing on hi-tech agricultural parks.

However, they warn that without detailed implementation instructions, the move will not be effective.
Prime Minister Nguyen Xuan Phuc has set aside a credit package of 50-60 trillion VND (2.2-2.6 billion USD) to encourage local farmers and enterprises to develop hi-tech agriculture.

Several experts and representatives of enterprises spoke to the Nong Thon Ngay Nay (Today Countryside) newspaper this week about the new policy.

Do Ha Nam, General Director of Intimex Import-Export Joint Stock Company in HCM City, said agriculture firms need significant working capital, but accessing this has proved difficult.

“There must be large credit packages with easy, simple borrowing conditions so that agriculture firms like Intimex are able to use them,” he said.

“Vietnamese agriculture must be treated on par with other industries,” he said.

To ensure efficiency, performance conditions can be set, he said.

For instance, individuals or units should be able to create production values of at least 50 million VND per hectare to get permission to invest in the sector, he added.

Tran Ba Duong, Chairman of the Management Board and CEO of the Truong Hai Automobile Company, which is interested in agriculture, said the sector cannot grow without applying the “industry in agriculture” model.

Capital access, organizational and management skills are needed for hi-tech agriculture to grow, he said.

“Harvesting, transportation and post-harvest processes currently suffer huge losses and low quality of Vietnamese farm produce,” Duong said, suggesting that a post-harvest industrial complex be set for rice production.

Vo Quan Huy, Director of the Huy Long An Company in Long An Province, said one of the biggest difficulties faced by the Vietnamese farmer is mortgage. They are unable to mortgage their produce, factories and farms as collateral, according to the regulation, he said, adding that the amount of money they can borrow is a fraction of real demand.

“In terms of the 50 trillion VND credit package for agriculture, the State Bank of Vietnam must ‘open its arms’ to enterprises and help them with easier access to larger loans.”

The State Bank of Vietnam has lowered interest rates for agriculture loans over the past several years.

Accordingly, the rate dropped from 20 percent per year in 2011, to 12 percent per year in 2013. This year the rate stands at the lowest ever - 6.5 to 8 percent per year.

Since last month, the Agriculture and Rural Development Bank (Agribank) has been preparing 50 trillion VND to serve individuals, households, collectives and enterprises producing hygienic, safe food.

Such individuals and other entities can get loans at interest rates of zero to 1.5 per cent per year.

The aim is to develop a green agriculture sector that provides consumers with high-quality, safe farm produce for consumers.

Three years ago, the State Bank of Vietnam assigned Agribank to lend loans on a pilot basis to enterprises applying advanced technology in agriculture. So far 28 enterprises with 31 projects in more than 22 provinces and cities have been selected to participate in the programme.

Agribank general director Tiet Van Thanh said that the bank has implemented seven credit policies and one national programme for developing new rural areas. Farmers get priority for loans at lower interest rates, he said.

A representative of the Bac A Joint Stock Commercial Bank said that hi-tech agriculture projects need huge capital over prolonged implementation periods, recouping investment takes a long time, profits can be low and there are various risks involved.

“Very few enterprises will be ready to invest in agriculture if there are no supportive mechanisms like more flexible capital policies,” he said.

He said that banks should raise lending to agriculture from the current 18-20 percent to over 30 percent of their credit portfolio.

He also suggested stepping up co-operation among commercial banks in offering loans for big agriculture projects, especially hi-tech ones.

150 businesses join industry-agro-trade fair in Binh Thuan

As many as 150 domestic businesses are displaying various products at over 300 pavilions of at an industry-agriculture-trade fair which opened in the central province of Binh Thuan on December 24.

Most of the enterprises came from Dong Nai, Binh Dinh, Ninh Thuan, Tay Ninh and Khanh Hoa provinces and Ho Chi Minh City.

Visitors to the fair can buy foods, processing foodstuffs, garments, jewelry, cosmetics, footwear, household utensils, electronic commodities, home decorations, and ornamental plants.

A number of promotion programmes are launched to help customers buy products at the best prices.

The trade fair, which will run until January 1 next year, offers an excellent opportunity for businesses to introduce new products and promote Vietnamese brand names.

It also enables participants to seek trade partners and expand markets.

Other activities include art exchanges and games.

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