Pilot projects help improve rural incomes, say officials
 
The income of residents in five rural communes in outlying HCM City have improved significantly as a result of a pilot project in the government's national new rural-area programme.

The annual average revenue from one hectare has risen to VND239 million (US$11,400), up VND138 million against 2009, according to Thai Quoc Dan, deputy head of the city's Sub-department of Rural Development.

Dan, who spoke at a seminar in the city last Wednesday, said the commune farmers had switched to cultivating plants and raising animals with high economic value, including orchids and ornamental fish.

In addition, handicraft production and processing of clean salt has brought positive results.

Labourers in these communes earn an average income of VND2.5-3 million ($120-144) a month. The five communes no longer have any families under the Government's poverty line, which is an annual average income of VND4.8 million ($230)or less per person.

Agricultural workers now total 6,343, accounting for 11 per cent of the five communes' total labourers.

More than 90 per cent of working-age people in the five communes now have a job, according to the city's Steering Committee for the Programme to Build New Rural Areas.

The five communes are Thai My Commune in Cu Chi District, Xuan Thoi Thuong in Hoc Mon District, Tan Nhut in Binh Chanh District, Nhon Duc in Nha Be District and Ly Nhon in Can Gio District.

In 2009, the city selected the five communes for the pilot project after Tan Thong Hoi Commune in Cu Chi District had successfully built new rural areas.

Tan Thong Hoi was one of the first of 11 communes nationwide chosen to participate in the rural-area programme, which began in 2008.

The programme requires improvements in infrastructure and production, environmental protection, social security and residents' livelihoods and culture.

Although successful, Dan said that many farmers without assets could not borrow bank loans, which is something the city government had encouraged them to do.

Farmers have earned high incomes from raising milk cows and orchids, but these activities require a large amount of capital.

Growing vegetables, on the other hand, requires little capital. But farmers are reluctant to do so because of the unstable nature of the outlets that buy these products.

HCM City farms look to repeat 6% growth

The impressive 6 per cent growth that HCM City's agro-forestry and fisheries sectors achieved last year will be the target for this year as well, officials said at a review meeting last week.

The HCM City Department of Agriculture and Rural Development said at the meeting this growth was attained in the face of several difficulties.

Department director Le Thanh Liem said this was a result of following an urban agricultural model, reducing rice growing areas of low productivity and increasing the area for cultivating high-value ornamental trees and safe vegetables as well as dairy farming.

The vegetable cultivation area last year reached 14,456ha, up 7 per cent over 2011, of which 14,167ha was devoted to safe vegetable cultivation, a year-on-year increase of 7 per cent.

The city had around 2,010ha under flower and ornamental tree cultivation last year, up 2.4 per cent over 2011, the meeting heard.

The animal husbandry sector posted good growth figures last year as well. The city had a total of 113,500 cows, 363,000 pigs and 187,500 crocodiles last year, a year-on-year increase of 7.1 per cent, 9.2 per cent and 7.1 per cent respectively.

The husbandry sector was the largest contributor to the city's agricultural production value at nearly VND6.1 trillion ($292 million), followed by vegetable, flowers and ornamental tree cultivation sector with more than VND3 trillion($143 million) and the fisheries sector with VND2.6 trillion($124 million).

Last year, average revenue per hectare under agricultural production in the city reached VND239 million ($11,400)per year, up VND43 million ($2,100) compared to 2011.

Liem said the city's agricultural sector will target last year's growth of 6 per cent in agro-forestry and fisheries production value.

To achieve the target, the city would continue its agricultural restructuring programme towards urban agriculture, especially enhancing the application of hi-tech methods including biotechnology in production to provide safe and high quality products, he added.

The city would speed up investment in key agricultural projects such as the hi-tech agricultural park and the application of biotechnology, he said.

Le Minh Tri, deputy chairman of the HCM City People's Committee, asked concerned agencies to check and set aside about 500ha of land to widen the existing Hi-tech Agricultural Park.

He also asked the agricultural sector to work with banks to create favourable conditions for farmers and agricultural enterprises to access credit. In addition, "the city's agricultural sector should co-operate with other provinces and cities to find stable outlets for agricultural produce," he said.

Nguyen Van Truc, general director of the Saigon Agriculture Company, asked the Government to take measures to prevent the import of poor quality agricultural products and support enterprises in promoting their products in foreign markets.

Campaign promotes green technology
 
The fourth annual "Green Consumption" campaign, which seeks to improve people's awareness of environmental protection by consuming green products and help businesses who invest in green technologies will soon be launched in HCM City.

Last year around 200 firms were investigated and 67 of them were found violating environment laws. They were fined over VND3 billion (US$148,000), and eight of them were shut down.

Despite the fact that the penalty has increased sevenfold to VND500 million ($23,800), many companies continue with their polluting ways.

In the last three years the campaign attracted more than 9,000 youths people who participated in it and over 1 million other people who pledged to use green products.

Sales of green products increased by 40-60 per cent at Co-op Mart supermarket during the campaigns.

"This year's campaign will be divided into different categories for different customers," Nguyen Van Lai, director of the city's Department of Industry and Trade, was quoted as saying by Sai Gon Giai Phong (Liberated Sai Gon) newspaper.

A new feature in this year's campaign will be a public vote for best green products and enterprises.

Every city resident will be encouraged to join the campaign by sharing images of things they did to participate. The best photos will receive prizes.

"Co-op Mart pledges to display green products in best places, donate 10,000 vouchers for green products for customers, and offer promotions and discounts for green products," Nguyen Thanh Nhan, deputy director of the supermarket chain, said.

"Green Consumption" has proven to be an effective campaign and there are hopes it will spread nation-wide.

Foreign enterprise found violating environmental regulations

The Environmental Police Department caught red-handed last weekend a foreign-invested enterprise in the northern Bac Giang Province which was seriously polluting the environment.

Italisa Vietnam Co, Ltd – a wholly owned subsidiary of a brass alloy manufacturer in China – was found directly releasing its untreated waste water in the Song Khe-Noi Hoang Industrial Zone.

Police founded a 15-metre plastic tube connecting the company's electroplating area to the common drainage system without treatment process, which was already installed underground to cover.

Previously, police had discovered waste water outside the company premises with a pollution level hundreds of times higher than regulated.

Italisa Vietnam manufactures alloy sanitary products using bronze, silica and other chemicals. The company is reported to use 3,000 tonnes of materials a year and release some 150cu.m of waste water a day.

Investigation of the case is ongoing.

Ministry asks for unchanged fuel prices

The Ministry of Finance on January 15 issued an official regulation letter ordering traders not to raise retail petrol prices.

At the same time, it and the Ministry of Industry and Trade allowed key petrol traders to use the fuel price stabilisation fund as of January 15 afternoon in line with the current circumstances.

The two Ministries decided to restart the use of fuel price stabilisation fund for petrol, kerosene ands mazut oil with support of 300 VND per litre while diesel oil is not covered under the latest compensation allowance.

Thus, as of mid-November 2012, retail fuel prices remain unchanged.

The RON92 fuel costs 23,150 VND per litre, after dropping 500VND per litre on November 11, 2012.

Last year, the petrol retail price was adjusted 12 times with six increases and six decreases. In the first two weeks of this month, the global oil price has shown signs of a slight increase.

Prospects for gold price market in 2013

The pace of increase in gold prices has slowed down to 7.83% in 2012 compared to the annual rate 24% in years earlier, according to the data of the General Statistics Office .

This is an encouraging signal which would help restore market confidence and stabilize the macro-economy as the disparity between local and foreign markets has been narrowed, leading to a slight decrease in dollar price.

The signal was attributed to various reasons, including tamed inflation and shrinking consumer price index.

The declining gold prices in 2012 also stemmed from high deposit interest rates and effective management of the gold market and gold bars.

However, the disparity between local and foreign markets is still high as Viet Nam’s average gold prices sometimes closed at VND5 million per tael and remained there for long period of time.

To address the issue, the Government promulgated Decree 24/ND-CP dated April 3, 2012 to manage gold business activities in production and processing of gold jewellery and fine arts, purchase and sale of gold jewellery and fine arts, purchase and sale of gold bars among others.

The Foreign Currency Management Department under the State Bank of Viet Nam said that gold speculation has declined after the licensed gold bar market operated officially since January 10, 2013.

In Viet Nam, national gold reserve is modest. However, gold volume held by the public is estimated at 250-300 tons, equivalent to US$15 billion.

Hoa Lac Hi-Tech Zone attracts more than VND20 trillion

The Hoa Lac Hi-tech Zone has so far licensed 68 projects with a total registered capital of more than VND52 trillion, of which, 20 projects are already operating and 13 are under construction.

In 2012, seven projects were granted investment licenses and received decisions of land delivery, with total capital of more than VND20 trillion and covering more than 110 hectares. Over the past year, major projects in the hi-tech zone include the National Satellite Centre, the Military-run Telecom Group, FPT University, Vietnam Techno Nissan Company Limited, and Vietnam Universe Centre.

In early 2013, the management board has issued licenses to the investors of six projects: the Hanoi Science and Technology University, Vinaconex Corporation, Hanoi Department of Science and Technology, FPT Software Outsourcing, Green Hoa Lac, and Felix Vietnam Companies.

Shoe exports expected rise by 10% in 2013
 
The footwear industry will aim for export turnover of US$8 billion this year, an increase of 10.4 per cent over last year, according to the Ministry of Industry and Trade.

The ministry said that sport shoes and sneakers would remain the industry's key export staples this year besides leather handbags and briefcases.

To achieve this goal, the ministry has urged the footwear industry to increase the production of raw materials so that 60-65 per cent of the industry's demand can be satisfied by domestic materials. Currently, the footwear industry still relies heavily on imported parts, causing it to face difficulties as the world market remains volatile.

The industry is also closely working with the garment and textile industry and other relevant industries to create an industrial complex specialising in producing footwear accessories.

According to the Viet Nam Leather and Footwear Association, the industry also plans to build research and trade promotion centres to become more competitive.

Despite these economic hardships, the industry's export value still surged 10.6 per cent last year to $7.2 billion. Domestic footwear exporters said that the number of orders businesses have received from traditional importers had fallen 25-30 per cent against the previous year. Some footwear makers said that they had to adjust production, cut costs, increase product quality and even accept breaking even just to survive.

To gain last year's $7.2 billion, instead of only focusing on traditional markets in the EU, US and Japan, the footwear industry successfully won export contracts from new markets in South America and other Asian countries.

Last year, the industry also co-operated with large footwear material producers of India and Brazil to churn out footwear accessories.

PVN signed EPC contract for Nghi Son project

Viet Nam Oil and Gas Group (PVN) yesterday issued a Letter of Award and signed EPC (engineering, procurement, and construction) contracts with five contractors for the Nghi Son oil refinery plant project.

The consortium consists of JGC Corporation (Japan), Chiyoda Corporation (Japan), Technip Group (France/Malaysia), SK Group (Korea), and GS Group (Korea).

The US$9 billion project, based in the central province of Thanh Hoa, includes a $5billion EPC package.

Approved in 2008, the 400ha plant was designed with total annual capacity of 10 million tonness or 200,000 barrels of oil per day.

Involved parties have contributed capital to set up a company named Nghi Son Oil Refinery and Petrochemicals Company (NSRP) to operate the refinery, with PVN holding 25.1 per cent, Kuwait's Petroleum Group 35.1 per cent, Japan's Idemitsu Kosan Petroleum Group 35.1 per cent and Mitsui Chemicals 4.7 per cent.

The plant is set for completion in 2016 and will start production in 2017 with a focus on producing liquefied petroleum gas (LPG), gasoline products A92, A95 and A98, jet fuel and diesel oil.

It is the second largest oil finery plant project in Viet Nam in terms of the scale after the Dung Quat oil refinery plant.

When in place, the facility is expected to meet 40 per cent of local fuel demand.

Kuwait's Petroleum Group will supply crude oil to the project at about 10 million tonens per annum in the first phase.

The group will possibly increase the volume to 20 million tonnes annually after the project is expanded in the future.

Outline of NSRP

Location: Nghi Son Economic Zone, Thanh Hoa Province, Viet Nam

Establishment: April 14, 2008

Capital: $200 million

Investment ratio: Mitsui 4.7 per cent, Idemitsu 35.1 per cent, KPI 35.1 per cent, PVN 25.1 per cent

Refinement capacity: 200,000 barrels/day

Mid 2013 Finance close, EPC commencement

End 2016 Mechanical completion

Mid 2017 Commencement of commercial operations
 
Fuel prices to stand

The Ministry of Finance yesterday issued an official regulation letter ordering traders not to raise retail petrol prices.

At the same time, the two ministries of Industry and Trade plus Finance allowed key petrol traders to use the fuel price stabilisation fund as of yesterday afternoon in line with the current circumstances.

The two ministries decided to restart the use of fuel price stabilisation fund for petrol, kerosene and mazut oil with support of VND300 per litre while diesel oil is not covered under the latest compensation alllowance.

Thus, as of mid-November 2012, retail fuel prices remain unchanged. The RON 92 fuel costs VND23,150 per litre, after dropping VND500 per litre on November 11, 2012.

Last year, the petrol retail price was adjusted 12 times with six increases and six decreases. In the first two weeks of this month, the global oil price has shown signs of a slight increase.

World Bank expert urges banking system reform

The problem of dealing with the mounting level of bad debt weighing on the nation's commercial banks continues to stymie policymakers and affect the liquidity of the banking system, a World Bank expert told a meeting here yesterday.

There were emerging signs of systemic stress, including rapid credit growth, a leading indicator of potential financial crisis, said the World Bank's financial and private sector co-ordinator for Viet Nam, Sameer Goyal.

Banks in Viet Nam had limited buffers to address problems going forward, said Goyal. "There is a need for systemic restructuring to reduce the possibility of a financial crisis situation."

Deleveraging could be significant after credit booms, he warned. The fiscal cost of addressing a banking crisis was also typically high, pointing to the experiences of other countries in the region, including Indonesia, Thailand and South Korea.

The inter-connectedness of State-owned enterprises and banks in Viet Nam was another source of concern, given the weaknesses in the State-owned sector.

"There is also concern about under-reporting," Goyal said. The State Bank of Viet Nam has reported non-performing loans of 8.6 per cent but the actual figure could be much higher by International Financial Reporting Standards.

Government policies for addressing the issue of non-performing loans were inadequate, Goyal suggested, noting that the current restructuring plan for the nation's banking system "provides only guiding principles."

He pointed out several issues that needed further consideration, including a specific timeline for an actionable plan, conditions for merging weak banks, how the various actions would be financed, the role of foreign investors, and restructuring of the Viet Nam Development Bank and Viet Nam Bank for Social Policy. A road map for the Asset Management Corporation was also needed.

Firms prepare for fierce competition

Vietnamese firms will have to brace for tough years ahead and aggressively promote and develop markets at home and abroad, business leaders said yesterday.

The message came at a press conference held by the Business Association of High-Quality Vietnamese Goods.

Nguyen Lam Vien, the association's deputy chairman, said that this year would continue to be a difficult year for Vietnamese companies due to the impacts of the global economic downturn.

In addition, the time for the ASEAN-China Free Trade Agreement to take effect was drawing near, he said.

By 2015, goods imported from ASEAN countries and China will enjoy zero tariffs, setting the stage for very fierce competition between local and foreign firms in the domestic market.

"Time is running out for Vietnamese businesses to consolidate their position in the domestic market," he warned.

For this year, the association would implement four programmes, including one to raise the competitiveness of small firms through co-operation with the Co.opMart and Big C supermarket chains. This programme would help Vietnamese firms gain a strong foothold in the local market, Vien said.

Vu Kim Hanh, the association's chairwoman, said, "With small-scale production and limited financial capacity, local firms face many difficulties in promoting their products in supermarkets compared to multinational companies."

Hanh said through the programme implemented by the association, selected firms would be provided advice on choosing product portfolios, registering trademarks, building brand names, negotiating with supermarkets and other activities and strategies.

"It is not an easy task, but we must do it to create conditions for Vietnamese products to access modern supermarkets in a sustainable manner," she said.

She added that the association would continue organising fairs to promote locally made products in rural areas, and carrying out activities to link local producers with distributors in large provinces and cities nationwide, and with small traders at traditional markets.

With regard to the international market, Vien said: "This year the association will strengthen promotion programmes to help Vietnamese high quality goods to further penetrate ASEAN and Chinese markets."

The association and the HCM City WTO Centre have signed an agreement to carry out intensive market research in key markets like China, Indonesia, Cambodia, Myanmar and Thailand.

Vien said the research would help Vietnamese firms overcome legal and technical barriers in the process of distributing their products in those markets.

Prices of unprocessed shrimp skyrocket

Prices of raw shrimp are increasing sharply due to short supply.

Tiger prawn prices in the Mekong Delta were up by VND10,000 (US$0.48) per kilo against last week, to the highest price within a year.

Twenty-pieces-per-kilo size tiger prawn costs VND240,000 ($11.54) while 30 and 40 ppk sizes cost VND160,000-170,000 ($7.7-8.2) and VND150,000 ($7.21) per kilo respectively. Prices of white-legged shrimp also rose to VND125,000-130,000 ($6-6.25) per kilo of 40 pieces and VND110,000 ($5.29) per kilo of 60 pieces.

Nation sees first trade surplus with Malaysia

Two-way trade turnover between Viet Nam and Malaysia reached US$7.3 billion in the first eleven months of last year, up 7.5 per cent on the same period in 2011.

According to figures released by the Viet Nam Trade Office in Malaysia on Monday, Viet Nam's exports to Malaysia were estimated to be $4.16 billion and its imports from the country, $3.1 billion.

Viet Nam mainly exported crude oil, computers, electronic products and spare parts, rubber, rice, steel, glass products and vehicles and components to Malaysia while its main imports included electronic appliances and spare parts, vegetable oil, unprocessed plastic, fuel, chemicals, machinery and household electrical equipment.

Dairy firms pledge to stabilise prices
 
Several big dairy companies in HCM City are expanding capacity this year to meet demand for products offered through HCM City's price-stabilisation programme.

Although the current phase of the city programme ends in about three months, the dairy companies have already been working with partners to ensure good prices on imported raw materials. In addition, one company will open a new plant.

Tran Thi Le, general director of Dong Tam Nutrition Food Joint-Stock Company (Nutifood), told Sai Gon Giai Phong (Liberated Sai Gon) newspaper that Nutifood had signed contracts to buy 2,000 tonnes of milk powder from New Zealand and the US, most of which would be used by the end of April.

This year, Nutifood said it would increase the number of its products in the price-stabilisation programme from nine to 17. The company also targets a 50 per cent growth in turnover this year.

Meanwhile, the biggest domestic dairy company, Vinamilk, is planning to open a new milk-powder production plant in Binh Duong Province. The new plant's capacity will be double that of the company's previous factory.

With the new plant, its price-stabilised products will sell for prices between 29 per cent and 47 per cent lower than the price of imported milk, according to Do Thanh Tuan, head of the company's foreign relations department.

Last year, the current phase of the city programme began the first day of April, and will start again at the same time this year.

Since April of last year, dairy companies have reported an increase of up to 50 per cent in turnover earned from price-stabilised products.

Le said that 2012 was the second year that Nutifood participated in the price-stabilisation programme.

She said the company's total turnover last year was more than VND1.6 trillion (US$76.19 million), a year-on-year jump of 35 per cent, and turnover from nine price-stabilised products rose by 30-50 per cent.

Like Nutifood, Vinamilk also reported high turnover growth due to price-stabilised products.

Tuan said the company's turnover last year for such products, including powdered milk and fresh milk, rose 20 per cent year-on-year.

Since the programme began, the two dairy companies have provided more than 9,200 tonnes of price-stabilised milk to the HCM City market.

Can Tho industries lack investors
 
High land prices and frequent changes in compensation and resettlement policies have kept investors away from industrial parks in the southern city of Can Tho, the Dau Tu (Viet Nam Investment Review) newspaper has reported.

Nguyen Tien Dung, director of Can Tho Branch's BMC Building Material and Commercial Company, said his company had invested VND170 million (US$8,173) in Hung Phu 2A Industrial Park but had only 30 ha of land, with four operating projects.

Tran Thanh Can, deputy chairman of Cai Rang District's People's Committee, said that the park had not cleared much land last year as investors lacked financial capacity.

The Can Tho People's Committee has agreed to offer tax exemptions or cuts as well as preferential loans and lower land rentals.

Vo Thanh Hung, head of the management board of Can Tho Industrial Park and Export Processing Zone, made the suggestion to the People's Committee.

Vo Thanh Tong, deputy chairman of Can Tho City People's Committee, asked agencies to review the financial capacity of investors and revoke their licenses if they delayed projects.

Currently, Can Tho City has five operating industrial parks, attracting 206 secondary investment projects, with total capital of $1.848 billion. There are 22 foreign invested projects worth $180.8 million.

Exports to EU face uphill battle on weak demand

The Ministry of Industry and Trade (MoIT) has urged exporters to better exploit the European market as exports to the outlet this year were forecast to increase by only 10 per cent against last year's 16 per cent.

The ministry said the country's staple market exports had shown signs of difficulties this year.

According to the Viet Nam Textile and Apparel Association, textile and garment exports to the EU would be hard hit as market demand was forecast to decrease while textile and garment exporters from other countries would offer cheaper products to boost their competitiveness.

EU textile and garment importers are tending to import products from Cambodia, Laos and Bangladesh in stead of Viet Nam as the three countries' exports enjoy a zero per cent import tax while Vietnamese products currently face a 10 per cent levy.

The Viet Nam Association of Seafood Exporters and Producers has been also concerned about a decrease of export value to the EU market, predicting the trend will last for the entire year.

However, the MoIT also expected that the Viet Nam -EU Free Trade Agreement would be signed to help exporters boost their shipments to the market.

To further aid exports, experts recommended domestic should gain better market research as the EU has increasingly applied more quality regulations on products.

They said domestic exporters must accept the costs of quality certificates and hygiene regulations required by the market, which is considered fastidious and demanding.

According to the MoIT's statistics, bilateral trade between Viet Nam and the EU last year surged 16.5 per cent against the previous year to reach US$28.3 billion, of which Viet Nam's export value to the EU was $20 billion. Viet Nam's key export staples to the market included mobile phones, computer components, footwear, garments and textiles.

Delta looks to boost farm produce

A plan to increase production of rice, fruit and aquatic products in Cuu Long (Mekong) Delta's 12 provinces and Can Tho City will be submitted for approval to the Ministry of Agriculture and Rural Development.

The US$16.6 million plan was developed by the Southwest Region Steering Committee, Can Tho University, the Cuu Long Delta Rice Research Institute and the Southern Fruit Research Institute.

Under the proposal, vocational training for the region's labourers would also be offered during the 2013-17 period.

The plan also calls for stronger cooperation among localities in projects related to agriculture, farmers and rural businesses.

Implementation will be carried out by the steering committee in cooperation with ministries, the Delta's 12 provinces and Can Tho.

On Sunday, Deputy Prime Minister Nguyen Xuan Phuc met with the steering committee, which reported that the Delta region had a growth rate of 10 per cent last year compared to 2011.

The Delta region, the country's largest rice, fruit and aquatic producer, cultivated 24 million tonnes of paddy last year, up 2 million against the previous year.

Last year, the Delta's export value reached US$10 billion, up 10 per cent against 2011.

Culture, education and poverty reduction activities also saw progress, with the annual average income per capita in the Delta reaching VND32 million last year.

Ten per cent of the area's households are considered poor, a drop of 1.29 percent against 2011.

Seafood company sells subsidiary shares

Seafood processor Hung Vuong Corp (HVG) announced the completion of its share sales in its three subsidiary companies, which brought the company a total of VND107.8 billion (US$5.2 million).

HVG sold all of its 90 per cent stakes, worth VND37.8 billion ($1.8 million), in An Lac Co Ltd, reduced holdings in Hung Vuong Vinh Long Co Ltd from 90 per cent to 31.7 per cent, earning VN35 billion ($1.7 million) and decreased its stakes in Hung Vuong Sa Dec Food Processing Plant from 70 per cent to 11.7 per cent, fetching another VND35 billion ($1.7 million).

All transfer values, realised in cash, were equal to the book value of these investments in the financial statement. By the end of the third quarter, HVG's available cash totalled VND541 billion ($25.9 million). — VNS

Au Viet Securities plans to dissolve

Au Viet Securities Co (AVS) has surprised the market by asking for its shareholders' opinions on the company's plans to dissolve and delist its shares on the Ha Noi exchange given the market's improved performance since the beginning of the year.

According to AVS chairman Doan Duc Vinh, the company will terminate its services of brokerage, underwriting, stock depository and investment consultancy. It will also sell assets and leave the stock market.

"I think the dissolution is the right decision in the context that the top 10 brokerage companies account for up to 60 per cent of the market share. Small brokerages cannot compete and exiting now will save money for both myself and shareholders," Vinh said.

Fertiliser firm to part with treasury stocks

Phu My Fertiliser (DPM) plans to sell all of its treasury stocks (the company's stocks that were bought back by the company itself) comprising 2.45 million shares in the next 2-3 months, the company announced. The sales will be carried out by the order matching method.

DPM performed very well last year given the widespread economic woes. The company estimated a total pre-tax profit of VND2 trillion (US$95.7 million), exceeding its yearly target by 80 per cent.

Bridgestone tire plant opens in South

Bridgestone Tire Sale Viet Nam Limited Liability Company has opened its first plant in Viet Nam, applying state of the art technology at My Phuoc 3 Industrial Park in the southern province of Binh Duong.

The Bridgestone Bandag Retread plant will implement the entire retread process, including inspecting casing conditions, repair work, new treads and a final check before they return to the market.

According to Bridgestone, using Bandag retread tires can save up to 35 per cent of the cost compared with new ones.

 Nation vaults past neighbours in FDI
 
Relative to GDP, Viet Nam attracts the second highest amount of FDI after Singapore in the ASEAN grouping, an HSBC study has found.

It attributed this to the country's wages being the lowest among major ASEAN members and its business environment being more competitive than that of India, the Philippines, and Indonesia, though it still trails significantly behind Thailand and Malaysia in the latter aspect.

The country's urbanisation rate is still low at 30 per cent and should continue to accelerate in the coming years. This means that the increase in productivity due to farmers moving into cities in the past two decades is still far from ended.

More than 60 per cent of its population is under 35, and the labour force is likely to expand in the next two decades, meaning more domestic demand and less wage pressure.

In the past couple of years the country has lost its lustre as one of the best-performing countries in the region due to raging inflation and inefficient management of the economy. This has slowed FDI inflows but they remain robust for a country of its size.

The US chip giant made a US$1 billion investment in Viet Nam in 2009. The inflow of high-tech FDI into the country caused an increase in demand for skilled labour.

To meet the standards required, Intel has been sending Vietnamese employees to other facilities in Asia as part of its hiring strategy. The company has also begun to address the shortage of skilled labour by talking to US universities to establish campuses in Viet Nam.

This example shows that MNCs can raise both the supply and demand of skills in the host country. But what ultimately would maximise the technological knowledge in the host country is the absorptive capacity of the economy.

This has allowed the country to gain market share in low-skilled manufacturing such as apparel and footwear.

Its exports are also increasing in value, boosted by foreign investment in electronics by Korean and Japanese firms.

The rapid increase in Japanese involvement in Viet Nam is considered positive for future productivity and growth in manufacturing.

In 2011 Japanese FDI made up 25 per cent of total inflows into Viet Nam, and in January-October 2012 this had risen to 58 per cent.

According to a survey by the Japan External Trade Organisation (JETRO), Japanese investors find Viet Nam attractive because of its low production costs, abundant labour force, and political stability, considering it to be cheaper and more stable than Thailand or China.

But Viet Nam lags behind the other two in terms of its links to regional markets and the performance of Japanese firms investing there.

The appreciation of the yen against the dong is another positive, along with Japanese Government support for investment in Viet Nam.

The survey suggests that should Viet Nam keep improving its economic structure, FDI inflows are likely to accelerate.

Areas of concern include infrastructure, access to raw materials, customs duties, administrative procedures, corruption, and intermediary goods for production.

Even in the current environment, many Japanese firms are flocking to Viet Nam to reduce costs and expand their production base.

With the government making economic stability a bigger priority than rapid growth, there is hope that more progress can be achieved.

In the coming decade, as production costs rise in China and Thailand, Viet Nam looks well-positioned to fill the gap and move up the value chain.

Ministry to support salt producers
 
The Ministry of Agriculture and Rural Development has urged salt-producing provinces to support salt farmers and ensure a good harvest this year.

It also spelled out the measures they had to implement.

Local authorities had to help the farmers improve their salt fields and keep a close watch on weather changes and regularly apprise the farmers.

They should also help the farmers with acquiring and applying advanced technologies, and help them acquire more lands so that they can switch from manual to industrial production.

Localities should persuade industrial-salt production units to upgrade production and harvesting technologies to improve quality and meet the requirements of the chemical industry, reducing salt imports.

They had to especially focus on environmental protection in the salt production process, resolve difficulties faced by salt producers, and retain existing salt fields to ensure stable production.

They should get salt production and processing establishments to sign long-term contract for buying salt from farmers.

They should enable salt production and trading establishments and farmers to get cheap credit to carry on with their activities efficiently.

They should invest in improving the infrastructure for salt production.

Last year the country's total salt production area shrunk to 14,157ha from 14,500ha in 2011, while output was an estimated 807,000 tonnes.

Thousands buy into low-cost domestic tourism campaign
 
The HCM City Tourism Association reviewed a domestic tourism stimulus campaign instituted last year at a conference last week.

Tran The Dung, deputy head of the HCM City Tourism Stimulus Group, said the eight-month programme saw 15,810 people buying low-cost tours to Phu Quoc, Con Dao, Da Lat, Buon Ma Thuot, and the central and northern regions.

Twenty city-based companies took part.

The association's deputy chairwoman, Nguyen Thi Khanh, said the tour prices were discounted by 35-40 per cent thanks to the support offered by Vietnam Airlines, which cut fares by 45-52 per cent, and Vietjet Air.

On behalf of travel companies, Dung called for starting the programme earlier this year.

The co-operation between the association and Vietnam Airlines has had a remarkable effect on other airlines, making them cut fares to compete, he said.

Besides, the programme has had a beneficial effect on Ha Noi and Da Nang, he said.

"They also began tourism campaigns with support from local tourism associations.

"They have initiated negotiations with airlines for lowering fares for tourists coming from the northern and central regions to the south and the Central Highlands."

The programme persuaded service providers to cut prices or at least not hike them last year, helping stabilise prices in the tourism industry, he said.

It also helped to an extent reduce the illogical gap between the prices of domestic and outbound tours – the former have for long been higher — he said.

Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR