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Indices rise as shares soar
Nearly 55 per cent of shares increased on both national exchanges this morning, bringing to a halt the prolonged downturn.
On the HCM Stock Exchange, the VN-Index rose 0.43 per cent after eight consecutive sessions of decline, closing today at over 366 points. Advancers largely overwhelmed decliners by 180-50.
Heavy purchases by investors helped boost trading volume by 61 per cent and the value of trades by 41 per cent with up to 65.3 million shares, valued at VND972.2 billion (US$46.3 million), exchanged.
Most blue chips posted gains, with property developer Hoang Anh Gia Lai (HAG), Vietcombank (VCB) and PetroVietnam Finance (PVF) hitting their daily limit of 5 per cent while others were up from 0.7-3.7 per cent.
Among the 10 leading shares by capitalisation, only food producer Masan Group (MSN) dropped 4.7 per cent and real estate developer Vincom (VIC) closed down 2 per cent after three sessions of rising to their ceiling prices.
Financial Ocean Group (OGC) was the most active code today on the southern bourse with nearly 2.3 million shares changing hands, also hitting the ceiling price of a 5 per cent rise to VND8,900 a share.
On the Ha Noi Stock Exchange, the HNX-Index finished at 59.83 points, a jump of 1.58 per cent over yesterday, with gainers tripling losers.
Value of trades decreased 18 per cent, however, to about VND254.6 billion ($12.1 million) on a volume of 29.7 million shares.
Shares of securities companies were still the most heavily traded codes in Ha Noi, with VNDirect (VND) and Kim Long (KLS) seeing the most trades of 3.22 million shares and 2.83 million changing hands, respectively. Both VND and KLS closed up 3.3 per cent at around VND9,500 a share.
Stocks plunge to their floor prices
Over 160 of 680 listed stocks plunged to their floor prices yesterday, continuing to drag down benchmark indices on both national stock exchanges.
On the HCMC Stock Exchange, the VN-Index lost another 0.84 per cent from yesterday’s close to conclude the session at 364.48 points, with decliners outnumbering advancers by over two-to-one.
Decreased purchasing power also pushed market volume down by 30 per cent to about 40.5 million shares, while the value of today’s trades dropped by 19 per cent from the previous session to VND688.4 billion (US$32.8 million).
Blue chips were mixed. While shares in property developer Vincom (VIC) hit the ceiling and steelmaker Hoa Phat Group (HPG) gained 1.6 per cent, two heavyweight stocks – insurer Bao Viet Holdings (BVH) and food producer Masan Group (MSN) – fell by almost 5 per cent. Other large-cap shares retreated more modestly or closed unchanged.
Sacombank (STB) was again the most-active share, with over 3.4 million changing hands; however, STB closed unchanged for a third session in a row at VND14,800 ($0.70) per share.
On the Ha Noi Stock Exchange yesterday, the downward spiral continued, with the HNX-Index closing off 1.24 per cent to 58.90 points. Losers overwhelmed gainers by 209-37.
Many investors started a strategy of bottom-fishing on the northern bourse yesterday as they increasingly expected another snap rebound following the current prolonged downturn. This helped increase the overall value of trades by over 10 per cent to VND311 billion ($14.8 million), with nearly 38.7 million shares changing hands.
Kim Long Securities Co (KLS), the most-active share nationwide on a volume of 4.2 million shares, continued to decline, however, closing at VND9,200, a loss of 4.2 per cent.
In contrast to local investors, foreign investors increased their buys yesterday, picking up a combined net of over VND60 billion ($2.9 million) worth of shares
Leaders of the State Securities Commission have confirmed this week that the settlement period for securities trades would be reduced early next year from the current three days after the transaction date (T+3) to T+2.
“Though this has been long awaited, its implementation takes time due to the current infrastructure inadequacy,” analysts of FPT Securities Co wrote in a market report. “Therefore, any positive impacts of this information are not significant enough to push up the market.”
SJC sells 975 kg gold on slipping gold prices
Saigon Jewelry Co (SJC) sold 26,000 taels of gold, or 975 kilograms, in the last 3 days when the world gold price started its downward trend.
The trader, owning a 90 per cent market share in gold bullion, sold 7,000 tales on Thursday morning, 11,000 taels yesterday, and 8,000 taels a day before, while buying just some a dozen taels.
“Previously, we sold averagely 2,000 taels a day,” Nguyen Cong Tuong, deputy head of SJC sales department, told Vietnam Economic Forum, an online publication of the Hanoi-based newswire Vietnamnet.
All SJC shops in HCMC were in a state of overcrowding with hundreds of customers queuing up and waiting on plastic chairs arranged in a U-shaped circle around the cahiers.
“For those who buy less than 10 taels, the payment was conducted immediately, but for those buying up to some hundreds of taels, we have to ask them to pay at bank branches near our shops since we were incapable to handle their huge piles of cash,” Tuong told newswire Vneconomy.
Strong local demand is said to have pushed the price up and widened the price gap between international and domestic gold price to some VND2.2 million ($105) a tael. The closing price on Wednesday was 43.79 million and VND44.04 million a tael for bid and ask, up VND240,000 a tael from the two-month low set in the morning.
The downward trend of world gold price and the surge in local demand make it impossible for us to reduce the domestic prices since it will boost demand and thus, put a huge pressure on our stock, a SJC representative told Thoi Bao Kinh Te Saigon online.
If world price remains unchanged in coming days, the domestic demand will gradually cool down, he added.
Meanwhile, the Ho Chi Minh City-based Phu Nhuan Jewelry Co (PNJ) sold some 900 taels, mostly SJC gold bullion, while the sales of its own PNJ-DAB gold billion brand was small, Nguyen Thi Cuc, deputy general director of PNJ told Thoi Bao Kinh Te Sai Gon online.
The announcement of Nguyen Van Binh, governor of the State Bank of Vietnam – the central bank of Vietnam, that SJC gold bullion would be the national brand has soared up the demand for SJC gold and undermined the demand for other brands of gold bullion.
The SJC gold bullion may be transformed into SBV gold bullion brand in the future, he said in a meeting with the Vietnamese National Assembly late last month.
The HCMC-based Sacombank Jewelry Co (SBJ) and the Hanoi-based Bao Tin Minh Chau Co (BTMC) were also on the same boat with PNJ.
“We sold around some hundreds of taels, down 4-5 fold against that before the release of governor Binh’s statement”, said Nguyen Ngoc Que Chi, general director of SBJ.
Bao Tin Minh Chau saw customers flocking to buy gold rings, with only a few of them buying its own Bao Tinh Minh Chau gold bullion brand, said Nguyen Thi Huong, deputy head of BTMC sales department.
SJC spot gold Thursday morning stood at VND43.05-43.45 for bid and ask, down VND600,000 a tael day on day. The price slumped VND1 million within two days.
World spot gold stood at $1,578.6 an ounce after slipping to $1,562.1 an ounce, a 11-week low, while gold future was quoted at $1,586.9 an ounce.
Some expert has forecast the gold to fall to $1,475 an ounce, down 20 per cent compared to its record high of $1,923.7 an ounce set in September.
A metal trader in Hanoi told newswire Vnexpress that a commercial bank has asked him to sell the US dollar at VND21,410 a dollar, up VND150 a dollar day on day.
The real selling price of the greenback was VND390 a dollar higher than the officially listed price at banks, said the newswire.
Some experts said the falling of gold is also a reason for the strengthening of the greenback in local market since they were stocking the currency to buy gold illegally for reselling.
The bid and ask price at Vietcombank today were quoted at VND21,015 and VND21,021 a dollar, up VND2 a dollar day on day. The ask prices for the greenback at other commercial banks followed suit VCB move, though their bid prices were VND5-20 a dollar lower.
Interbank rate stay at its one-year high of VND20,813 a dollar.
The dollar in the free market in Hanoi were at VND21,250-21,300 for bid and ask.
The government has announced that Vietnam’s current account may ran a surplus of over $3 billion this year due to rising oversea remittance inflow of over $9 billion.
Shareholders approve merger of three banks
Shareholders of TinNghiaBank, Saigon Commercial Bank, and De Nhat, or Ficombank yesterday approved a merger between the three lenders.
They also voted at their respective shareholder meetings in HCM City to call the new entity Saigon Commercial Bank, which will take over the operations of all three banks.
One temporary board will be set up to complete the necessary procedures for the new bank to begin operations.
After the State Bank of Viet Nam approves the merger in principle, the new entity will hold a general shareholders meeting, possibly on December 23.
The bank will have a chartered capital of almost VND10.584 trillion (US$504 million), the aggregate of the three banks’ capitals.
Shareholders of the three banks will get one share in the new bank for every share they hold.
The bank, which will have a network of 230 branches and transaction offices, plans to look for strategic foreign partners to increase its charter capital to VND16 trillion ($760 million) by 2014.
Khanh Hoa okays 5-year plan for ethnic groups
The central province of Khanh Hoa will set aside VND540 billion (US$25.7 million) for socio-economic development in ethnic minority and mountainous areas in the 2011-15 period, according to the newly approved development programme for these areas until 2015.
The programme sets a target to reduce the rate of poor households among ethnic minority people by 6-7 per cent annually and double the per capita income of ethnic people by 2015 from the current level.
To realise these goals, the province will continue to invest in infrastructure construction to facilitate traffic in all communes.
It will work to bring a national grid to more than 98 per cent of households in mountainous areas and clean water to 95 per cent of the population.
The provincial People’s Committee said starting from next year, the programme will build models to support minority households in economic development. Accordingly, each commune will select five poor and near-poor households to provide them with plant and animal seeds, fertilisers, production techniques and help them find outlets for their products.
The model will be expanded to 760 households in the next three years.
Dairy product prices on the rise
The price of powdered and fresh milk has increased in two successive days, dairy shop owners in Ha Noi and HCM City have said.
“Abbott was the first company to announce the new price with an increase of around nine per cent,” a shop owner in Ha Noi’s Lo Duc Street said.
The price of milk products from other companies is expected to increase in the coming days, she said.
Owner of the Hong Thanh shop on Son Tay Street in Ha Noi said that Abbott had increased the price of some of their products over the last few days.
“Vinamilk, Mead Johnson and Nestle have also informed us prices of some of their products will rise by up to 19 per cent in the coming days,” he said.
Information from local shops matched the changes submitted to the Price Management Department under the Ministry of Finance which was given to the media. When answering questions from local media several days ago, deputy department head Nguyen Anh Tuan said the ministry had received correspondence on price increases from four companies including Mead Johnson, Abbott and Nestle.
According to Tuan, Mead Johnson registered to increase prices of their 35 products by up to 19 per cent, while Abbott wanted to lift prices by nine per cent. Nestle plans to increase their prices by 2-10 per cent effective of December 20.
Tuan said the reasons companies gave for raising prices were the high input costs involved in production.
Higher costs for labour, high exchange rates and material costs had forced companies to raise prices, Tuan added.
Changes to the tax code also factor in these changes as tax applied to some products has increased.
After receiving proposals from milk companies, the department affirmed they would examine the factors affecting prices and violators would be fined according to the Government’s regulations, Tuan said.
Halt called on second-rate petrol processing
The Ministry of Industry and Trade (MoIT) had ordered a halt on production of petrol A83 after HCM City authorities found 11 enterprises selling A83 mixed with A92 or A95 for the latter’s price, said a ministry official.
According to Industry and trade minister Vu Huy Hoang, who cited the HCM City Department of Science and Technology’s Directorate for Standards, Metrology and Quality (STAMEQ), 11 businesses in the city turned a profit by selling petrol A83 mixed with petrol A92 or A95 at the retail price of the higher quality product.
Hoang made the announcement and asked HCM City’s industry and trade department to penalise seriously sub-standard petrol dealers.
A83 is poor-quality petrol with an octane index lower than regulated, incompatible with most vehicles on the city’s roads that have been designed to use petrol with high octane indices, like A92 and A95.
The ministry has repeatedly proposed stopping producti on of petrol A83, since there is low market demand, but many other ministries have not agreed and Saigon Petro continues to process it with a total capacity of 200,000 tonnes per year.
The HCM City Industry and Trade Department must explain to the People’s Committee about reasons for continuing the production of petrol A83, Hoang said.
Deputy minister of industry and trade Nguyen Cam Tu said the processing of petrol A83 should cease because no petrol stations advertise it, and its continuing availability encourages fraud.
Huynh Khanh Hiep, deputy director of the HCM City Industry and Trade Department, said that in the aftermath of the announcement, his department had required all petrol traders in the city to check their supplies carefully for A83.
The department would penalise violators and possibly revoke trading licences from the petrol stations, Hiep said.
Dam Thi Huyen, deputy general director of Viet Nam’s National Petroleum Corporation (Petrolimex), which holds 60 per cent of the domestic petrol and gas market, denied that petrol stations owned by her company have sold petrol A83.
Until now, the State has permitted production of petrol A83 in combination with other kinds of high quality petrol products and has not performed regular checks on stations. As a result, trade fraud in petrol quality has gone undetected, she said.
Petrol A83 mixed with petrol A92 or petrol A95 has often been sold in HCM City and Cuu Long Delta provinces for profit at VND500 per litre, said Huyen, adding that the low-quality product would also prove popular in the north because of high transport fees and low benefits.
Oils and aromatic spice industry needs help
The Government should issue policies to support the development of the domestic oil, aroma and cosmetic industry, delegates said at the third congress of the Viet Nam Association of Oil, Aromas and Cosmetics last Saturday.
Tran Binh Duyen, chairman of the Mediplantex National Pharmaceutical JSC, said there was a huge demand for essential oils and aromatic spices both in domestic and foreign markets.
Viet Nam has favourable conditions to grow various kinds of oil plants, including peppermint, holy basil, cinnamon tree and anise, he said. Previously, the country had exported thousands tonnes of essential oils per year. However, the situation has completely changed in recent years since the cultivation areas for these plants shrank severely, he added.
Duyen attributed the situation to the lack of a long-term development plan as well as Government support.
In addition, the current high tariffs imposed on essential oil products have made locally made products less competitive than imported ones, he said, requesting the Government to reconsider its policy in this regard. However, other delegates at the congress disagreed, saying a reduction in taxes might be impractical because it would have to extend to other agricultural commodities as well.
Hoang Van Duoc, the association’s chairman, said with the current situation of small-scale production and backward production technology, enterprises involved in the industry are only able to produce raw products with low export value, while refined essential oils were imported at much higher prices.
As a result, the industry has a very high annual trade deficit of about US$65-100 million, mostly because of the import of cosmetics and aromatic spices, he said.
Nguyen Minh Khoi, head of the National Institute of Medicinal Materials, said the industry should seek ways to find more outlets for essential oil products that Viet Nam has an advantage in.
It should also focus on growing high quality seedlings to replace poor quality plants, he said.
Delegates suggested that the association works with relevant ministries and localities to set up zoning plans for the industry.
The association, which has 80 members, said it would soon submit to the Government a five-year (2011-16) -development plan for the industry.
It will also work to set up a stable material zone for high value oil plants in the coming years, Duoc said.
The association will co-operate with local and foreign organisations to hold more seminars, training courses and trade promotion events to support its members.
It plans to set up a portal to provide more information to its members, he said.
Provinces pull the plug on slow projects
Inefficient projects in the provinces of Lam Dong and Kien Giang have had their permissions of investment revoked, according to the provincial People’s Committees.
The People’s Committee of Central Highland Lam Dong Province has revoked permission of investment from 33 domestic projects, including 24 projects that had already been granted investment licences with a total charter capital of VND7.4 billion (US$352,380).
The majority of those projects had not been implemented as scheduled or lacked workers, the People’s Committee said.
Those projects were mainly in the hydropower, tourism and forestry sectors. Some had already received extensions from the committee but investors had failed to live up to their commitments.
Many investors had been fined billions of dong for damaging forests, the committee said.
Lam Dong expected to withdraw investment permission from 44 other projects next year.
Meanwhile, Kien Giang had also withdrawn investment permission and land use rights from seven projects in Phu Quoc and Kien Luong.
Those projects had been implemented slowly with insufficient investment capacity, and land had not been used in line with development plans approved by the Prime Minister. Most of them were in the tourism, property, forestry and farming sectors.
Kien Giang has already withdrawn investment licences from 13 projects using farming land for inefficient or inappropriate use and slow development.
Ben Tre looks to increase cocoa production
Farmers in the southern Ben Tre Province plan to increase cocoa cultivation because of the local product’s unique aroma.
“A Belgium company, the chocolate producer Grand Place, wants to have a chocolate brand from local cocoa beans because of its unique aroma, different from beans grown in other Vietnamese localities,” said Phan Van Khong, director of the province Centre for Agriculture and Forestry Promotion.
Khong said the company had registered to invest in a factory in the province’s Ben Tre Industrial Park.
Grand Place currently runs a chocolate factory in the VSIP Industrial Park in the southern province of Binh Duong.
Pham Van Minh, director of Pham Minh Cocoa Company, a local cocoa purchaser, said his Japanese and Russian partners preferred cocoa from Ben Tre Province.
The company’s factory, located in Ben Tre Province’s Chau Thanh District, will be put into use in the next few months. It will process locally grown cocoa.
Huynh Quang Duc, deputy director of the centre, said both the provincial authority and agricultural authority want to expand cocoa cultivation.
The province People’s Committee has set a target to grow 10,000ha of cocoa. Since 2004, 9,000ha have been cultivated.
Cocoa trees are mainly planted under the shade of coconut trees as experts say cocoa is a shade-preferring tree.
Authorities want to produce cocoa products that meet international quality standards.
With that aim, the local Centre for Agriculture and Forestry Promotion is carrying out a production programme under criteria required by UTZ Kapeh Viet Nam, which certifies international quality of agricultural products.
Duc said the programme began early this year with assistance from Helvitas Swiss International Viet Nam, which provides tools and training in production techniques, post-harvesting techniques and work safety.
Nine clubs of cocoa farmers have been set up in the province’s Chau Thanh, Mo Cay Bac, Mo Cay Nam and Giong Trom districts, involving 135 households with a total area of 135 ha of land.
UTZ production requires strict control of pesticides and chemical fertilisers; local monitoring and tracking systems for the origin of products; farmers grouped in clubs; and production diaries kept by farmers.
“By 2014, when the programme ends, we will have 60 clubs and 900ha of cocoa production developed under the criteria for UTZ-certified products,” Duc said.
Bui Van Hoang, a farmer in the Club Huu Dinh in Chau Thanh District, is growing 700 cocoa trees on a 1ha-farm that also has coconut trees.
He said the cocoa earned him around VND25 million (US$1,100) a year, much higher than earnings from coconuts, the main tree on his farm.
Ben Tre is well-known for its coconut products and brands.
Dr Mai Thanh Phung, director of the Viet Nam Committee for Coordination of Cocoa Development, has told the local agriculture authority and farmers to place equal emphasis on both trees, and not just focus on one.
Khong of the Centre for Agriculture and Forestry Promotion said the local authority would create a brandname for products made from the locally grown cocoa.
Fast food foreign firms race to dominate Vietnamese market
International fast food chains are penetrating Vietnam, opening branches nationwide and dominating the market.
Two of the largest are KFC and Lotteria. One KFC representative commented, “This expansion is happening much faster than we expected."
International fast food chains are penetrating Vietnam, opening branches nationwide and dominating that market.
Rho Il Sik, General Director of Lotteria in Southeast Asia, said that, initially his firm expected to launch 70-80 shops in Vietnam, but they have now reached 100.
Lotteria can be found all over the country, especially in cities such as Haiphong, Hanoi, Danang, Vinh, as well as An Giang and Kien Giang provinces.
KFC products are also sold across the country. Their goal is to increase the number of shops to 116 by the end of 2012.
Jollibee, a company from the Philippines, has 25 branches in Vietnam.
There is no doubt that foreign firms own most of the market share in this area. According to a preliminary report, the fast food industry in Vietnam could be worth up to VND870 billion (USD41.4 million) this year.
Despite the money to be made in this market, many Vietnamese firms do not seem to be very interested.
Ly Quy Trung, owner of Pho24 brand, claimed that there is a difference between "fast food" and Vietnamese chains that serve traditional food, such as bowls of Pho, rice and cakes to customers who do not have more than five minutes to wait.
He added that Vietnamese fast food companies are at a disadvantage because of bad management and a lack of financial capacity and professionalism.
Ms. Kim Oanh, owner of Wrap & Roll restaurant network, said her restaurants specialise in selling rolled rice pancakes and Goi (a dish made of raw fish and vegetables). She also made a distinction between her business and "fast food".
Vo Tran Anh Thy from K-Do Barkery, said that the fast food business is not the strong suit of Vietnamese companies. After two years in operation, K-Do shifted their business model and development strategy, focusing on fresh cakes and coffee instead of food.
According to Mr. Trung, fast food customers go, not only for the food, but for the novel service and the brands. This, he said, poses a big challenge to Vietnamese companies.
Foreign producers interested in local building market
International producers of building machinery and equipment still see opportunities and growth potentials in the local construction market regardless of the economic woes.
The foreign enterprises participating in ConBuild Vietnam 2011 said they are offering the latest building technologies and products for local firms to approach the advanced technology on the spot, saving time and money in business trips abroad.
ConBuild Vietnam 2011, an international trade fair for construction, building and mining machinery, equipment, materials, vehicles, technology and services, is taking place at the Saigon Exhibition and Convention Center in HCMC’s District 7 until this Saturday.
Joong Hyun Ryou, global sales division general manager of South Korean firm Soosan Heavy Industries Co. Ltd., said the fast-growing Vietnamese economy had led to the surging demand for infrastructure development and construction.
According to the Ministry of Planning and Investment, construction projects in the next 10 years would require some US$160 billion to build some 5,000 kilometers of expressway, 300-400 kilometers of railway and seaports.
Exporters want stronger voice in coffee prices
Coffee growers and exporters are seeking ways to join forces with one another in the 2011-2012 crop to have a stronger voice in the pricing of coffee for global markets.
At the Coffee Outlook Conference organized by IBC Asia in HCMC on Thursday, enterprises and officials from the world’s leading coffee exporters like Brazil, Vietnam and Columbia sat down together to discuss strategies toward this goal.
Do Ha Nam, vice chairman of the Vietnam Coffee and Cocoa Association (Vicofa), predicted the price of robusta coffee to hover around the US$1,700-2,100 per ton range in the 2011-2012 crop. However, an effective stockpiling scheme will help buoy up prices, he said.
Nam cited an example how coffee prices have moved up recently when local coffee farmers restricted selling their produce given the low price over the past month.
Coffee prices might surge above US$2,100 per ton after the first quarter next year, he added, when enterprises receive supporting loans from banks to buy coffee in stock from farmers.
“Local coffee export firms have received commitments from several banks to offer them sufficient capital to stock up on coffee. The exporters would access this capital source from early 2012,” Nam said.
In addition, 20 coffee enterprises of Vietnam have pledged not to sign any new export contract with large volume in anticipation of better prices.
“To avoid repeating the situation early in the 2010-2011 crop when many traders delivered a large amount of coffee to foreign partners, leading to the local undersupply and causing coffee prices to surge as a result, we have agreed on the monthly export volume of 100,000 tons to regulate the market during this year’s crop,” Nam said.
Vietnam is the world’s second biggest coffee exporter and biggest exporter of Robusta beans. Therefore, if local exporters join hands, coffee prices will become favorable to both exporters and farmers.
The International Coffee Organization (ICO) has forecast the world coffee output at 132 million 60-kilo bags in the 2011-2012 crop, while the demand is put at some 135 million bags. In the past ten years, the global coffee consumption has always hovered around 130 million bags a year.
According to Vicofa, Vietnam would be able to produce some 1.25 million tons of coffee in this year’s crop, a rise of 100,000 tons against last year.
Coffee export reached an estimated 30,000 tons in November at a total value of US$70 million. The respective figures in the first 11 months were 1.1 million tons and US$2.3 billion, a modest increase in volume but a rise of 1.5 times in value year-on-year.
The U.S. is the largest importer of Vietnamese coffee, followed by Germany and Belgium, said the Ministry of Agriculture and Rural Development. The ministry expected the total export value of coffee to reach US$2.5 billion by the year’s end.
Gov’t to equitize 27 State groups from 2015
The Government has set a goal of equitizing 27 State conglomerates and corporations, including well-known giants, in 2015-2020.
The giants readied for going public in the period will include Vietnam Oil and Gas Group (PetroVietnam), Vietnam Coal and Mineral Industry Group (Vinacomin), and Vietnam Electricity Group (EVN), said the Central Steering Committee for State-owned Enterprise Reform and Development.
At a review conference on the performance of State-owned enterprises in the past 10 years and projections for the next five years held in Hanoi on Thursday, the committee said the State would retain majority stakes in these giants, though. The State will own 65-75% of the above firms as well as eight other large groups and corporations, while holding non-majority stakes in the remaining 16 corporations.
By 2020, only 17 groups and corporations would remain under the State umbrella alongside some 200 monopolies operating in the fields of national defense, security and public service.
Meanwhile, certain State firms would be excluded from the equitization process, such as the military-run mobile service operator Viettel, the State Capital Investment Corporation (SCIC) and the Vietnam Railway Corporation (VRC).
* Also at the review conference on Thursday, Tran Xuan Hoa, chairman of Vinacomin, continued to seek approval for hiking coal prices for the power industry.
Hoa complained the cheap coal supply for electricity generation had resulted in VND5 trillion in lost revenue for the State budget this year. Coal is now sold to power generators at about 60% of market prices, he said.
“According to our calculation, some 12 million tons of coal has been sold to the power industry this year, at a price of VND580,000 per ton while the production cost amounts to VND950,000 a ton,” Hoa noted.
In addition, the audit of the year’s first half showed that the gap between coal prices for electricity production and for export led to a loss of VND2.4 trillion for Vinacomin. Hoa revealed the export coal price was now VND2.4 million per ton.
Ninh Thuan urged to unveils development master plan to 2020
The central province of Ninh Thuan made public its socio-economic development master plan to 2020, which gives priority to six sectors of energy, tourism, agro-forestry-fisheries, and processing.
Addressing the conference in Phan Rang-Thap Cham city on December 10, Prime Minister Nguyen Tan Dung said Ninh Thuan has great potentials for development, particularly wind and solar energies, tourism and salt production.
Therefore, in Vietnam ’s marine strategy, Ninh Thuan is expected to become an economic hub in the south central and Central Highlands region, he said, adding that the province has been selected to house the country’s two first nuclear power plants.
“This is a good opportunity for Ninh Thuan province to create a breakthrough in its development,” PM Dung noted.
He recommended that the province improve its investment environment, assist investors and invest in human resources to meet demands in the next period.
On the same day, Prime Minister Dung inspected a project to build the province’s coastal road.
VCCI, Canada-Vietnam Business Council ink deal
Vietnam Chamber of Commerce and Industry (VCCI) and the Canada-Vietnam Business Council signed a cooperative agreement in Hanoi.
Addressing the function, VCCI Permanent Deputy Chairman Hoang Van Dung said Vietnam-Canada economic and trade cooperation does not match the two countries’ potential and strengths.
The signing of the agreement will help boost trade relations between the two countries via market approaches and providing information on economic, trade and investment development policies, as well as setting up a working group to maintain regular information exchange, he said.
Dung pledged Vietnam will support and create all favourable conditions for Canadian businesses to invest in the Southeast Asian country as well as deal with difficulties the two sides have faced in the past.
According to the President of the Canada-Vietnam Business Council, Danny Leung, the signing of the agreement is a positive signal in economic development between the two countries.
The document will serve as a legal corridor for both sides to seek effective measures to strengthen economic and trade cooperation in the future, he said.
Restructuring public investment a must
The Prime Minister has recently asked ministries, agencies and localities to tighten management of State capital sources in an effort to stop scattered investment and optimize the efficiency of State-funded projects.
Vietnam needs more than VND500 trillion to complete projects approved by the National Assembly and the Government in the 2011-2015 period. However, only VND225 trillion, less than half of the total amount, has been allocated for key projects including those to build transport infrastructure, irrigation works, hospitals and schools. This means nearly two thirds of the on-going projects will be put on hold.
For a long time the State budget has been considered the main source of capital to implement development projects and many sectors and localities want to divide the cake. Scattered and inefficient investment results from the confusion of concepts between administrative boundaries and economic space. Every province wishes to become a comprehensive economic entity that boasts integrated agriculture, industry and services, along with universities, ports, airports and economic zones, although many of them fail to meet necessary conditions for investment.
Vietnam has a high incremental capital output ratio (ICOR) compared to other countries in the region and the world. Despite a decline in recent years, public investment still accounts for nearly 30 percent of total social investment capital. Without tight controls, the country will be faced with huge public debts in the coming years. The current public debt crisis in Europe has taught Vietnam an invaluable lesson.
Studies show that the crisis stems from improper public spending and investment. In awareness of that fact, the Government has ordered no new projects using capital sourced from the State budget and Government bond sales, except for natural disaster mitigation and key national projects, aimed at stabilizing the macro-economy and bringing inflation under control.
In fact, 6,730 out of 25,200 ongoing projects got off the ground in the first half of this year. Worthy of note is that the number of new projects is much higher than last year’s six-month figure, and many projects are slow going.
A recent Party resolution stresses that public investment restructuring is one of the three key areas that need to be addressed in the next five years to spur the national economy. The Government has identified a roadmap for realising the Party resolution by strengthening State management of investment sources from the State and Government bond sales. This is an urgent task that should be done promptly and efficiently.
It is necessary to revitalize the way the leaders think of and manage the implementation of socio-economic development tasks in order to mobilise, allocate and use domestic and foreign resources effectively. In other words, it is time to change the leadership’s thinking. Only when the leaders work for common national interests, is State capital used effectively.
Domestic airfares discounted to VND 650,000
Low cost carrier Jetstar Pacific launched a promotion offering discounted airfares for tourists booking tickets from 00:01 am on December 9 to 11:59 pm on December 12.
Passengers traveling from April 4 to 19, 2012, will be offered a discounted fare of VND 650,000 (around US$31), not including duties and other charges, for one-way domestic flights from Ho Chi Minh City to Hanoi, Hai Phong, and Vinh.
Tickets can be booked via Jetstar’s official website http://www.jetstar.com and paid for online with credit cards (Visa, Master, JCB, AMEX) or with debit cards from local banks.
Jetstar will also offer discounted international air fares on its Hanoi/ Ho Chi Minh City - Singapore route from VND 450,000 (around US$21) to VND 750,000 (around US$36) for passengers travelling from April 11 to May 23, 2012.
Workshop held on promoting Vietnam Sea Tourism in Europe
Vietnam Airlines will co-ordinate with the Vietnam National Administration of Tourism and localities with potential for sea tourism to offer attractive tourism products to European visitors.
Vietnam Airlines will co-operate with ten leading European tourism magazines to introduce and promote the best travel destinations in Vietnam in 2012.
It will also increase the number of its flights to European countries and improve infrastructure at airports and international seaports to facilitate sea tourism.
Target markets include France, Germany, the UK, Belgium, Spain, and the Netherlands, as well as Denmark, Sweden, Switzerland, Austria and Poland.
The seminar, held by the Vietnam Airline Corporation (Vietnam Airlines), was attended by more than 50 delegates from domestic and foreign travel businesses, European tourism magazines and localities with sea tourism potential such as Quang Ninh, Da Nang, Hoi An, Nha Trang, Mui Ne and Con Dao.
HCMC stocked with commodities for Tet Lunar New Year
Ho Thi Kim Thoa, Deputy Minister of Industry and Trade expressed her appreciation at the efforts made by Ho Chi Minh City to make the price subsidized program a success, at a meeting of the People’s Committee on Saturday.
Ms. Thoa praised the city for preparing well in time for the coming Tet holiday season by stockpiling essential commodities under the gov’t price subsidized program. This showed concern for city residents by the city leaders, she added.
She said that with the successful implementation of the price subsidized program in the city she plans to replicate the program in other provinces and cities during Tet.
According to the Department of Industry and Trade, food items have been under preparation since April this year to ensure quality and a wide variety of products at reasonable prices. The bulk of the supply will come from companies participating in the price subsidized program and wholesale markets.
The city has channeled 878 shops to sell subsidized goods from 151 markets. Le Ngoc Dao, Deputy Director of Department of Industry and Trade said the department will work with districts to organize a ‘Vietnamese goods market day’, a spring festival and other activities to sell Tet goods.
Saigon Co-op supermarket chain and shops implementing the subsidized program will open longer than normal hours during Tet holiday season and reopen on the second day of the Lunar New Year after closing for one day of Tet, to convenience shoppers.
So far, businesses have stockpiled goods 3-4 times more than planned at a total value of around VND5,566 billion (US$265 million).
The HCMC Food Association and businesses affirmed that prices of beverages, cakes and candy produced domestically for Tet will be sold 15-20 percent lower than imported brands.
Tuna exporters on crest of wave
Vietnamese tuna has been exported to 87 markets, nearly double the number earlier this year, thanks to high demand from international markets at the end of the year, according to Viet Nam Association of Seafood Export and Processing (VASEP).
The General Department of Viet Nam Customs said tuna exports reached US$314 million in October, a year-on-year increase of 28.6 per cent.
The US is the main consumer of Vietnamese tuna, leading the top three importers, which also include Europe and Japan.
The US makes up 46 per cent of the total exports, with exports to the market in the past 10 months totalling nearly $145 million.
Vietnamese tuna is shipped to 21 countries in the EU bloc, with Germany, Italy and Belgium being the biggest importers.
In October, Italy surpassed Germany, which previously led the bloc in Vietnamese tuna imports, to become the biggest consumer, with a growth of $2.9 million in export value, up 258 per cent over that of the corresponding period last year.
Vietnamese tuna has met the EU’s strict requirements, according to VASEP.
Tuna exports to Japan is on an upward trend, according to VASEP, with a growth rate reaching its highest level, of over 82 per cent, equal to $36.6 million.
The association said the Japanese economic recovery from the tsunami later in the year had led to the increase.
Switzerland is another potential market for Viet Nam’s tuna products. Tuna exports to the country saw a high growth rate, with $3 million, a year-on-year increase of over 52 per cent.
In contrast, tuna exports to Taiwan have weakened since early this year. The export value last year was 127 per cent higher than 2009, but it fell continuously this year, with a 60 per-cent drop in one month.
The association said the promotion of export activities in localities, including the establishment of a joint-venture between Japan and southern Phu Yen province in trading, processing and exporting tuna, was not enough to raise exports.
VASEP urged the Government to introduce more proper and comprehensive policies to further promote co-operation between fishermen and tuna-processing firms, which would help improve the competitiveness of Vietnamese tuna in the international market.
Pepper exports double this year
The Ministry of Agriculture and Rural Development estimates the total volume of exported pepper this year to reach nearly 130,000 tonnes, which is worth more than US$775 million.
"If the predication is true, the export turnover in 2011 will have doubled last year's figure," the ministry said.
The ministry also reports that in November of this year, the pepper export volume was 6,000 tonnes, valued at $40 million. With this, the total pepper export volume and value in 11 months was 122,000 tonnes and $713 million respectively.
"Compared to the same period last year, the volume is up by 10.5 per cent and the value has surged by 83 per cent," the ministry added.
The US is still the leading importer of Vietnamese peppers.
Strengthening financial cooperation between Vietnam and Laos
Vietnam and Laos signed two financial agreements in Hanoi on December 12 to boost bilateral cooperation in the coming years.
They included an agreement on financial regulations and the management of Vietnamese non-refundable aid for Laos, and a cooperative agreement between the two financial ministries for the 2011-2015 period.
Signatories to these documents were Vietnamese Financial Minister Vuong Dinh Hue and his Lao counterpart Phuphet Khamphounvong.
Minister Hue noted financial cooperation between Vietnam and Laos has been strengthened and developed strongly. He said the many agreements signed recently will help promote mutual understanding between the two finance ministries and improve the capacity of the Lao ministry.
For his part, Minister Phuphet praised Vietnamese experts for assisting the Lao financial sector and expressed his hope that the two sides will continue to promote their friendship and cooperation.
Both host and guest briefed each other on the economic and financial situations in their respective countries and discussed measures to boost future bilateral cooperation.
On behalf of the Lao State, Minister Phuphet presented the Isala Medal (Independence Medal), third class, to the Vietnam University of Finance and Marketing.
Agricultural fair sees contracts worth VND300 bln in total
A batch of agreements and transactions worth nearly VND300 billion has been reached at the International Agricultural Fair that closed in the Mekong Delta city of Can Tho on December 12.
The week-long event attracted the participation of more than 270 domestic and foreign businesses from Thailand, China, India, the US, Japan, the Republic of Korea and Singapore.
Products on display at 560 booths included machinery, production lines for processing and preserving agricultural products, as well as animal feed, seafood, rice, vegetables and fruit, animals, fertilisers and pesticides.
During the fair, the Mekong Delta Rice Research Institute, Can Tho University and the provincial Department of Agriculture and Rural Development organised a programme to provide consultation for nearly 2,000 farmers on how to cultivate, harvest and preserve agricultural products.
The organisation board also presented 12 gold medals to products of high quality and a total financial aid worth VND50 million to ten farming households.
Vietnam, Japan cooperate in finance
Vietnam has urged Japan through its cooperative agency, JICA, to support the Finance Ministry in implementing a number of programmes such as the tax management (phase III) and electronic customs projects.
In his meeting with Japanese Deputy Finance Minister Nakao Takehiko in Hanoi on December 12, Finance Minister Vuong Dinh Hue asked the Japanese Finance Ministry to assist Vietnam with key issues such as financial system and public investment restructuring, and State-owned enterprise restructuring.
He also asked the Japanese ministry to provide more funding for Vietnam’s 10th Poverty Reduction Support Credit (PRSC).
The Minister thanked the Japanese Government, including the Finance Ministry, for its help to Vietnam. In particular, the Japanese Government committed to provide US$1.9 billion in ODA to Vietnam for the 2012 fiscal year at the recent consultative group meeting, despite facing difficulties caused by the March earthquake-tsunami disaster.
He provided a briefing on Vietnam’s macroeconomic situation and the Government’s solutions to curb inflation, maintain macroeconomic stability and social welfare.
In reply, Deputy Minister Nakao Takehiko expressed his pleasure at Vietnam’s economic achievements in controlling inflation and maintaining macroeconomic stability, especially through an increase in export revenue.
Japan will continue to help Vietnam achieve its targets for infrastructure construction and poverty reduction, he said.
Can Tho to host Mekong Delta Exhibition
The southern city of Can Tho will host an exhibition on 10 years of development in the Mekong Delta in April 2012, along with the 37th anniversary celebration of the total liberation of Southern Vietnam.
This information was released at a December 12 press briefing held by the Ho Chi Minh City People’s Committee, in collaboration with the Southwest Region Steering Committee and the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank).
Addressing the press briefing, Deputy Prime Minister Vu Van Ninh, Head of the Southwest Region Steering Committee, said this will be a major event highlighting the development and achievements recorded by the Mekong Delta region over the past ten years, and calling for more investment to ensure sustainable growth in the region.
The exhibition will offer a good opportunity for organizations, businesses and investors to promote their trademarks, products and operational capacity in a variety of fields
The event is expected to have 500-700 stalls featuring the region’s culture and beauty and introducing its major projects with the aim of boosting the Mekong Delta’s deep integration and sustainable development.
A series of events will also be held during the April 27-May 1 exhibition, including conferences on connectivity for sustainable agricultural development and on promoting investment and development, as well as a seminar on developing the credit market and banking services in the Mekong Delta region.
“The World in 2012 - The Economist” makes first debut in Vietnam
”The World in 2012” publication in Vietnamese will officially make its first debut on December 17.
“The World in 2012” is renowned as one of the most successful of the Economist Magazine - the world’s No 1 economic magazine.
The publication, issued at the end of each year, forecasts socio-economic, cultural and technological situation in the world with the participation of the world’s leading journalists and editors.
Under the sponsorship of the Vietnam Chamber of Commerce and Industry (VCCI), Vietnam CEO Corp will co-ordinate with the Business Forum Newspaper and the Entrepreneur Magazine to organize a seminar entitled “The World and Vietnam: Forecasts 2012” in Hanoi on December 17.
Scholars and policy-makers, leading economist and leaders from big enterprises will discuss and forecast the economic trends in the world and Vietnam.
They will also propose solutions for the Vietnamese enterprises in three major areas including outlets for Vietnamese goods and retail market, how to solve the problem of capital sources in the context that the government has tightened financial and monetary policies, and solutions to restructure businesses.
In addition, “The World 2012” will provide an overview on the world economy from the perspective of politicians including Henry Kissinger, Hillary Clinton and David Cameron, as well as Bill Gates, Carlos Slim and other well-known figures.
The World 2012 has been published in 31 languages with more than one million issues circulated each year in 90 countries across the continents.
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