Nutifood enters into coffee production

The Nutrition Food Joint Stock Company (NutiFood), known for its Grow Plus milk brand, has entered into the coffee market after acquiring 25 per cent of the Phuoc An Coffee Co., a State-run coffee concern in the central highlands province of Dak Lak.  

With $5.3 million in charter capital, Nutifood announced a partnership with Dak Lak province to invest in high-tech agriculture and become a strategic shareholder in Phuoc An Coffee, with total investment capital of VND1 trillion ($44 million).

It will invest in building a coffee processing plant with a brand associated with Dak Lak’s geography and will also conduct research and surveys on applying high-technology in the dairy cattle industry.  

According to Mr. Tran Thanh Hai, Chairman of NutiFood, Vietnam’s coffee production has a global market share of 20 per cent but only 2 per cent of export value, mainly due to it primarily exporting raw materials. “Nutifood therefore wants to make use of its distribution network to bring Vietnamese coffee to international markets,” he said.

Mr. Nguyen Tuan Ha, Deputy Chairman of the Dak Lak Provincial People’s Committee, praised NutiFood’s investment cooperation in sustainable agriculture development, especially high-tech agriculture. He stressed that the government and the provincial authority prefer investors with sustainable development and high-tech applications and commits to creating the conditions necessary for them to implement their investment effectively.

The US Department of Agriculture (USDA) estimated Vietnam’s coffee stocks at the end of the 2015/2016 season at 230,000 tons, or 3.83 million bags, down 40 per cent from a year previous.

Coffee exports have been rising and Vietnam’s shipments between October 2016 and the start of the current crop year last month totaled 667,000 tons, up nearly 5 per cent year-on-year, based on the latest Vietnam Customs data. The crop year runs through to September. 

Vinamilk to export to China

Vietnam’s leading dairy producer Vinamilk signed a memorandum of cooperation with a Chinese partner on May 12 to export dairy product to the country, witnessed by senior Chinese leaders and visiting State President Tran Dai Quang, who is in China from May 11-15 to pay a State visit to China and to attend a high-level forum on the Belt and Road Initiative.

China is a huge market with a total dairy market value of about $30 billion a year. Vinamilk hopes that the memorandum will be an opportunity to export dairy products in the near future, when a trade agreement between the two countries is signed.

Vinamilk is the largest dairy company in Vietnam and among the Top 50 dairy companies in the world in terms of revenue. Its products are not only consumed in the domestic market but also exported to 43 countries around the world, including the US, Japan, Thailand, and the Philippines, as well as the Middle East. Its export turnover stood at $258 million last year.

It owns ten dairy farms around the country, with over 17,000 heads of cattle. The Ho Chi Minh City Securities Corporation (HSC) estimates that, in 2016, its farms supplied 42,654 tons of raw milk, up 13 per cent and contributing 7 per cent of the country’s raw milk input.

According to HSC, Vinamilk will maintain stable growth thanks to the potential of its core business. It can maintain double-digit revenue growth in 2017 and the dairy sector will continue to grow at an average rate of over 10 per cent.

It forecast that Vinamilk’s average annual growth rate in net sales from 2017 to 2020 will be 10.9 per cent and after-tax profit 9.3 per cent.

Vietnam’s largest dairy producer began operating the country’s first-ever organic dairy farm under European standards in the central highlands province of Lam Dong on March 14.

The farm has investment capital of $8.7 million, is certified by the Netherlands-based global network of inspection operations, Control Union, and has a herd of 500 imported cows. “We apply close monitoring measures to ensure the herd only produces high-quality milk,” said Ms. Mai Kieu Lien, Vinamilk’s CEO.

Yestech Vina fined over wastewater discharge

The Bac Ninh Provincial People’s Committee has fined the Yestech Vina Co., Ltd over its illegal discharge of untreated wastewater into the rainwater drainage system at the northern province’s Que Vo Industrial Zone.

The company was fined VND200 million ($8,815) and must cease further discharges.

The People’s Committee also directed Yestech Vina to install a wastewater treatment system under technical standards within two months of the date of it handing down the decision. 

The company must follow the terms of the decision within ten days. It this period elapses without further action, the company will be subject to additional legal provisions.

Yestech Vina was punished by the People’s Committee for a similar incident in April last year.

Yestech Vina is a 100 per cent South Korean-owned company, established and operating in Vietnam since February 2013.

It specializes in the manufacturing of mobile phone and smart watch components for supply to local and foreign companies, including Samsung.

Previously, Bac Ninh fined the Willtech Vina Co., Ltd, also fully South Korean-owned and specializing in producing and processing telephone components at Que Vo, VND133 million ($5,875) after it released wastewater.

VietinBankSc affirms its position in corporate customer segment

One of the most prestigious securities firms in the country, the Vietnam Bank for Industry & Trade Securities JSC (VietinBankSc), has asserted its position in the industry when engaging in the provision of securities services, offering securities trading, underwriting, depository, and enterprise finance and investment advisory services.

2016 marked an important milestone for VietinBankSc’s operation, with it witnessing booming revenue in enterprise finance advisory services. Unlike ordinary securities firms, which focus on the personal broker service field, VietinBankSc chose a more professional method by utilizing the advantages of its parent bank, the State-owned VietinBank, together with the benefits from having a tight partnership with almost all major banks and financial institutions in the market.

Its finance advisory services are set to be its flagship activity, leading and improving other activities of the company. It recorded 138 successful advisory contracts last year, with total arranged capital of nearly VND23 trillion ($1 billion), bringing total revenue from such services to more than VND60 billion ($2.64 million). This made a significant contribution to the company’s pre-tax profit, which reached VND102.24 billion ($4.5 million) in 2016 and resulted in a profit margin of 57.3 per cent, a three-year high.

The focus on enterprise finance advisory services was set in 2014, with the company achieving breakthrough growth in the field, of 222.7 per cent compared to 2013. In 2015, VietinBankSc won the “Top Consulting Company” award from the Vietnam M&A Forum.

The award was in recognition of its successes in 2015, highlighted by substantial growth in total revenue and profit. The boom in its advisory services took place at a time when revenues in the field and issuing agent services reached VND101.5 billion ($4.47 million), three times higher than in 2014, with a total of 107 successful advisory contracts.

Within its customer list, VietinBankSc has successfully managed to win the trust of the State Capital Investment Corporation (SCIC), Vinafood 1, the Vietnam Railways Corporation, Vingroup, and Novaland, among others. Its thriving consulting services contributed significantly to business performance in 2015, with pre-tax profit reaching VND95.13 billion ($4.2 million), equal to 111.9 per cent of the annual plan.

But it was not just its focus on and the development of its service lines that made VietinBankSc so successful. The investment banking model the company adopted required actual ability, a professional team, solid financial capacity and prestige, and a large customer base. Founded in 2000, VietinBankSc was originally owned by VietinBank, and after being equitized in 2009 inherited the advantages as well as the support of its parent bank, especially in finances, human resources, and customer base.

Thanks to such advantages, VietinBankSc is the leading financial institution in the consulting field, underwriting corporate bonds. Notably, a completely new service in Vietnam’s financial market - leveraged buyout (LBO) - has also been pioneered and successfully implemented by VietinBankSc.

With more than VND904 billion ($39.8 million) in charter capital and VND1.07 trillion ($47.1 million) in owner equity, VietinBankSc holds a special advantage in enterprise finance advisory services, with a full package in most important sectors, including advice in bond and share issuances and on M&A deals, from the initial process of preparing the necessary documents for the purchase, valuing the target enterprise, helping to determine the starting and ceiling price the acquired enterprises can accept from buyers, and advising on negotiations.

These are the services VietinBankSc will continue to focus on in 2017. The arrangement of capital via the issuance of corporate bonds is not a new concept, but has not been given due regard because enterprises have only focused on mobilizing capital from credit sources, yet mobilizing capital from issuing corporate bond has much greater advantages. There has also been a lack of prestigious advising and underwriting entities to create successful deals.

Work starts on Phu Yen component plant     

CCIPY Viet Nam Co, a member of the US-based Coilcraft Group, started construction on an electronic component factory in the An Phu Industrial Zone in Tuy Hoa City of the central coastal province of Phu Yen on Saturday.

This will be the first factory of its kind in Phu Yen. It has a design capacity of 500 million items per year, and it will mainly produce RF wirewound chips and electromagnets, all for export, vietnamplus.vn reports.

Koo Heng Sheong, Director General of CCIPY Vietnam, said the US$5.7-million factory is part of Coilcraft’s goal to develop production in Asia.The facility, which covers an area of 2.7ha, will be put into use in January 2018, offering job opportunities for about 2,000 local workers. 

App challenge targets trade hurdles     

Eleven teams of developers from APEC member economies will be in Ha Noi on May 18 and 19 to participate in a 24-hour challenge to build a new mobile or web solution to one or more key challenges faced by medium, small, and microenterprise owners, who want to expand their businesses through cross-border trade.

The “APEC App Challenge” is a joint initiative by Viet Nam’s Ministry of Industry and Trade, the Asia Foundation and Google.

“Although the Internet has dramatically cut down the exporting costs for SMEs, especially in developed economies, businesses in the region are facing a number of challenges and the benefits from international trade remain elusive,” Lai Viet Anh, Viet Nam E-Commerce and Information Technology’s principle deputy director general, explained. “We hope that these creative young developers will encourage APEC policymakers to learn how to apply technology to some of the real concerns people face when they want to expand their businesses.”

Developer teams are encouraged to think creatively about the challenges faced by local SMEs, the opportunities afforded by online tools and marketplaces and the practicalities associated with developing and implementing their new products.

“The topic of APEC App Challenge is particularly important for the Asia-Pacific region, where SMEs make up some 98 per cent of all businesses and employ two-thirds of the region’s labour force,” The Asia Foundation’s senior director of Digital Media and Technology Programmes John Karr said. “For example, even though Indonesia’s SMEs contribute nearly 60 per cent of GDP, their share of total exports is only 16 per cent.”

“The APEC App Challenge is a unique effort to generate learning and share new ideas across APEC by concurrently building potential solutions to help small businesses overcome existing barriers,” Google Asia Pacific’s head of trade and economic affairs, Andrew Ure observed.

“Ultimately, the goal of the APEC App Challenge is to highlight new ways of promoting inclusive, innovative, and sustainable growth in Asia-Pacific economies and stipulate policies that will promote more innovation to address trade issues,” Alan Bollard, APEC Secretariat’s executive director, added. 

Railroad upgrade needs VND7 trillion

The Vietnam Railway Corporation has proposed the Ministry of Transport spend VND7 trillion (US$308 million) upgrading the north-south railroad so that trains could travel faster.

Under its plan, the money will be spent on four key projects, including VND1.6 trillion for the Hanoi-Vinh section, VND1.8 trillion for the Nha Trang-Saigon section, VND1.8 trillion for rail bridge and pillar upgrade, and VND1.8 trillion for tunnel improvement and three new stations.

Therefore, the enterprise has suggested the Government arrange capital from government bond sales in the 2017-2020 period for the four projects.

When the projects are done, the corporation will be able to improve the transport capacity of passenger and cargo trains, thus boosting earnings and reducing fares.

Currently, the railway industry is standing at a disadvantaged position due to low speed and high fares, amid the rise of local low-cost airlines and faster buses. Therefore, the corporation wants to invest in infrastructure to increase train speed and cut ticket prices in the coming time.

According to the corporation, the current railroad infrastructure has been deteriorating, affording a speed of 50 kilometers an hour for passenger trains and 35 kilometers an hour for cargo trains. Many sections in mountainous areas and bridges have weakened but no investment has been spent so far.

Vietnam exports packaging paper for the first time

Vietnam has exported packaging paper for the first time and this item is expected to be an important export product of the paper industry in the coming time, said Vu Ngoc Bao, vice president and general secretary of the Vietnam Pulp and Paper Association (VPPA).

At a press conference on the Paper Vietnam 2017 exhibition in HCMC on Wednesday, Bao said the export of the first batch of packaging paper by a foreign-invested enterprise in Hau Giang Province is a remarkable achievement of the paper industry this year. So far, Vietnam’s paper exports are limited to tissue paper only, with shipments to easy markets.

More packaging paper projects will be put into operation such as a 500,000-ton carton paper production line of Chanh Duong Paper Mill Co Ltd in Binh Duong Province and the Tan Kim Cuong packaging paper processor with a capacity of 70,000 tons a year, Bao added.

Five companies have started producing carton paper this year with a total capacity of more than 580,000 tons a year.

In 2017, the paper industry is expected to produce an additional 1.56 million tons of packaging paper, taking the total output to over three million tons per year.

Packaging paper is one of the two items with the best growth rate of the paper industry in recent years while the sector has seen a decline in other products such as print and writing paper, especially newsprint. Up to now, two production lines at Tan Mai and Bai Bang Paper have been shut down.

Paper Vietnam 2017 focusing on products, technologies, chemicals and equipment in the pulp and paper industry will be held simultaneously with the Rubber & Tyre Vietnam 2017 and Coatings Expo Vietnam 2017 at the Saigon Exhibition & Convention Center (SECC) slated from June 13 to 15.

Siam Brothers Vietnam to debut on HOSE

Siam Brothers Vietnam JSC (SBV) will debut on the Hochiminh Stock Exchange on May 16 after its successful initial public offering (IPO) with 4.2 million shares sold in November 2016.

SBV will float 20.54 million shares on HOSE at the reference price of VND40,000 each as advised by its consultant HCMC Securities Corporation. The trading band on the first day is +/-20%.

Earlier, SBV was a 100% Thai-invested company specializing in rope and fishing tool production. The firm has total chartered capital of VND205.4 billion with 75% owned by Thai founding shareholders, 10% by Vietnam Holding Ltd and the remainder by other individual and institutional investors.

Over the past 20 years, SBV has been known for its highly durable products on the local market. The company has a 40% market share in the rope market for agriculture, fishery and maritime safety. SBV has been the top choice for 90% of fishing boats in the country.

SBV has posted steady business growth with the compound annual growth rate (CAGR) of revenue reaching 13.42% and net profit 18.7% in the past five years. In 2016, the company obtained VND508 billion in revenue and VND113.9 billion in after-tax profit, soaring 38.6% against the previous year, due to a drop in material prices and SBV’s cost cuts. The earnings per share (EPS) were VND6,100 and a cash dividend payment at 20% was approved at the 2017 annual general meeting.

This year, SBV aims for VND601 billion in revenue and VND149 billion in after-tax profit given increasing market demand. Besides, it plans to launch new products to serve the strong development of aquaculture and agriculture. In the first quarter, a low-season period, SBV reported VND100.3 billion in revenue and VND11.7 billion in after-tax profit, up 28% and 14.7% year-on-year respectively.

Solutions suggested for Ben Tre tourism

Many solutions were suggested for Ben Tre Province’s tourism development at a seminar there on May 11, as the province has set a high goal for the sector.

At the seminar, Tran Duy Phuong, deputy director of the provincial Department of Culture, Sports and Tourism, said that Ben Tre expects to attract 1.2 million tourists including 550,000 international visitors and earning about VND1 trillion (US$43.85 million) in 2017.

Thus, the number of tourists to Ben Tre is expected to increase by 50,000 tourists while revenue is to increase by VND240 billion over 2016.

The provincial tourism sector aims for 22-25% growth in annual revenue and an increase of 12-15% in annual tourist arrivals in 2016-2020. However, the province needs effective measures to achieve these ambitious targets.

The province will have to change the way tourism is developed, restructure the sector, apply the most preferential policies, especially to marine tourism, and develop human resources, Phuong added.

Nguyen Minh Quyen, development manager of Ben Thanh Tourist, said his company has launched many tourism products for its visitors to Ben Tre. With experiences gathered from such tours, Quyen suggested the provincial tourism sector develop different segments for international and domestic visitors and an extra product for students.

Tour operators should know the demand of customers while Ben Tre Province must choose local destinations suitable for each group of foreign or domestic visitors. Then, the province can fine-tune tourism events to attract visitors.

Le Thi Ngoc Diep, deputy dean of the Faculty of Cultural Studies at the University of Social Sciences and Humanities, suggested seven tourism solutions including marketing, promotion of new products, investment in transport infrastructure, environmental protection and public administration, and cooperation with tour operators.

French expert advises city to build one-way tramways

Laurent Auzel, director of international cooperation of France’s Ingérop, has proposed HCMC invest in one-way tramways to help develop the public transit network.

To reduce traffic congestion in the city, there is no choice but to develop public transport to step by step restrict personal vehicles, Auzel stressed.

The city government is investing in metro lines, tramways and rapid bus services. However, in a city with high compression and narrow streets like HCMC, it is difficult to develop a conventional two-way tramway network, Auzel said.

It is only possible to set up a one-way tramway network. Since a one-way tramway does not occupy much space (only 4.2 meters in width, versus eight meters of the conventional one), it can be built above roads of more than 10 meters wide – without much impact on other modes of transport – with no need for site clearance as in the case of metro or two-way tramways.

With investment in one-way tramways to connect different areas of a populous city like HCMC, the problem of urban transport in the city will be solved in the future as the capacity of a one-way tramway is relatively large, an average of 4,000 passengers per hour per direction, said Auzel.

He informed that when the government of Valenciennes, Nord (France) decided to build a tramway to connect the central area with the north of the city, many people living along the route objected for fear their business operations could be affected. Now, the tramway has been of great economic efficiency, so people have accepted it.

The problem is that when developing one-way tramways, it is a must to pay attention to the locations of the stops since they must have two lanes for vehicles traveling in opposite directions. This is just a technical problem, however, said Auzel.

In addition, the expert told the Daily that HCMC with a huge number of personal vehicles was having a good opportunity to develop its public transport network. It is to say the city still has time to invest in public transit, before the problem becomes much more difficult and costlier as in the case of Bangkok, Thailand.

Of course, the municipal government needs to adopt a policy to limit the number of private vehicles now.

Ingérop, the world’s leading construction conglomerate founded in Paris in 1962, focuses on five construction sectors including infrastructure, urban planning/public transportation, water and environment, buildings, energy and industry.

HCMC gets go-ahead to develop major traffic projects

Deputy Prime Minister Trinh Dinh Dung has given the HCMC government the green light to add three large-scale traffic infrastructure projects to its master zoning plan for transport development by 2020 with a vision afterwards.

The first project is to build a bridge replacing the current Cat Lai ferry station. The cable-stayed Cat Lai Bridge is envisaged stretching some 4.5 kilometers including the main bridge and access roads, and having six lanes for automobiles and two mix-use ones.

The bridge will start at My Thuy Roundabout in HCMC’s District 2, and end in Dong Nai Province’s Nhon Trach District.

The project is estimated to cost around VND5.7 trillion, including over VND1.2 trillion for site clearance.

The project was previously not included in the city’s master zoning plan for transport development, as the HCMC-Long Thanh-Dau Giay Expressway is only about three kilometers from the ferry terminal.

The Ministry of Transport was also concerned that the bridge would obstruct the passage of container ships to and from Cat Lai Port.

However, the HCMC government had asked for the Government’s approval to build the bridge, given the increasing volume of traffic in the area.

The second project is to construct Can Gio Bridge to connect the outlying districts of Can Gio and Nha Be.

The bridge and its approach roads will have a total length of around 7.3 kilometers. With 40 meters in width, it will have four lanes for automobiles and two mix-use lanes.

The project requires an estimated VND5.3 trillion, excluding costs for site clearance and compensation.

Can Gio Bridge was also not part of the city’s earlier transport development plan. The reason is that another bridge has been under construction in the Binh Khanh ferry terminal area as part of the Ben Luc-Long Thanh Expressway. However, this bridge will only connect Nha Be District and Dong Nai Province.

Therefore, the municipal government sought approval from the central Government to develop Can Gio Bridge. Once in place, the bridge would replace the existing Binh Khanh ferry terminal, thus shortening the distance and traveling time between the city center and Can Gio, and reducing traffic congestion, especially on holidays.

The third project is to construct a road in parallel with National Highway 50, linking HCMC’s Nha Be District with Can Giuoc District in neighboring Long An Province. The road, with six lanes, is 8.6 kilometers long and 40 meters wide.

The project requires around VND5.3 trillion, with site clearance and compensation costs excluded.

APEC discusses human resources development in digital age

The APEC High-Level Policy Dialogue on Human Resources Development in the Digital Age officially opened in Hanoi on May 15.

In his opening remarks, Minister of Labour, Invalids and Social Affairs (MoLISA) Dao Ngoc Dung said technology and digitalization have made important contributions to improving labour productivity, generating jobs and developing new economic models and new markets.

However, they also pose a lot of challenges to the labour market and labour relations as there is a need for new professions and skills, he noted.

Grasping opportunities from the fourth Industrial Revolution and actively adjusting policies on employment and vocational training will be key to human resources development in APEC economies, he stated.

As the regional economies are making strong efforts to ensure a comprehensive growth, focusing on increasing the labour force’s adaptability to meet technology development requirements, the dialogue reflects APEC’s commitment to strengthening and fostering regional cooperation in line with human resources development demands, he added.

Delivering the keynote speech at the event, Deputy Prime Minister Vu Duc Dam highlighted that human resources are the centre of the development, especially in the digital age. The development of science and technology, particularly information technology, is setting new requirements and creating new conditions for human resources development. 

“Technology not only helps increase labour productivity but also connects all people around the world,” he said, adding that it encourages individuals to affirm their personal creativity and value.

Dam also mentioned the fourth Industrial Revolution with information technology as its foundation, saying that the appearance of new jobs to replace the old ones requires basic changes in education and training, not only for developing countries like Vietnam but also all nations.

He stressed the need to ensure equal access to education for all vulnerable groups in the society, inspire creativity among children, align theory with practice, connect schools and businesses, and most importantly train necessary skills of a global citizen.

Noting the importance of making forecasts on technological developments, Dr. Alan Bollard, APEC Secretariat Executive Director, said this dialogue will discuss a draft framework on human resources development, the labour market and social welfare for disadvantaged people which will be submitted for APEC higher-level meetings for consideration.

VietJet Air to open Hanoi-Yangon route

The low-cost carrier Vietjet Air said it will officially launch a new air route connecting Hanoi and Yangon – the famous tourism city of Myanmar, on August 31.

The airline will conduct round-trip flights every day with flight duration of one hour and 25 minutes. 

The flight from Hanoi departs at 12:05 and arrives in Yangon at 13:30 (local time). The return flight leaves Yangon at 14:30 and arrives in Hanoi at 16:55.

On the occasion, VietJet will offer tickets at price from only 205,000 VND (about 9 USD) for the route. 

This is the second service of VietJet to Myanmar, after the Ho Chi Minh City-Yangon route. 

Vietnam and Myanmar are attractive destinations for investors from many countries, and have strong economic development. The new route is expected to meet the increasing demand of travel of the two countries’ people, contributing to promoting regional trade and integration.

Vietnamese rice logo contest underway

The Ministry of Agriculture and Rural Development is excited to be hosting a logo contest aimed at picking a winning national design to make the Vietnamese rice brand stand out.

Complete details of the contest are available at the MARD website at www.mard.gov.vn and the Department of Agricultural Products Processing and Development at www.chebien.gov.vn. 

In making the announcement, Deputy Minister Tran Thanh Nam of MARD, said entries are being accepted April 26-June 26, inclusive. The winner will be announced sometime later this fall.

Deputy Minister Nam noted the first-place finisher will receive a cash award of US$4,400 (VND100 million) while second through fifth places will each receive US$660 (VND15 million).

Vietnam, China businesses sign big deals on sidelines of President’s visit

Vietnamese and Chinese businesses have signed trade and investment deals potentially worth billions of US dollars on the sidelines of President Vietnam President Tran Dai Quang’s state visit, reports Vnexpress.

Vinamilk, the largest producer of dairy products in Vietnam, has signed a memorandum of understanding with a Chinese stakeholder, said Vnexpress, although the underlying details are understandably sparse.

Even though such a memorandum is not a formal contract and is non-binding on any of the signatories, it shows that the parties are serious about negotiating a legally binding complex and high dollar agreement.

Coilcraft announces plans to construct plant in Vietnam

A local Coilcraft Inc. company official has announced the consumer electronics giant plans to start construction of a US$5.7 million manufacturing facility in Vietnam later this year.

If all goes as planned, the plant will be located on a 2.7 hectare site located at the An Phu Industrial Park in the city of Tuy Hoa in the south central coastal province of Phu Yen.

The Vietnam News Agency quoted the official as saying the plant would create roughly 2,000 good paying jobs.

Vietnam tries to overcome hurdles to realize economic target for 2017

2017 is considered a key to implementing Vietnam’s socio-economic development plan until 2020.

To realize the GDP growth of 6.7% set by the National Assembly will require stronger measures. 

Vietnam faced many difficulties in the first quarter of this year but its socio-economic situation showed some positive signs nonetheless.

The macro economy remained stable, the CPI increased a mere 0.9%, which was less than the same period last year, exports soared almost 13% to more than US$43 billion, and agriculture and services achieved higher growth than last year. Agriculture-forestry-fisheries achieved an annualized growth of 2% and international arrivals grew 29% to over 3.2 million. Generally, GDP growth in the first three months was 5.1%, lower than last year.

Deputy Minister of Planning and Investment Dao Quang Thu blamed the slower growth mainly on a decline in mining, oil, and gas. He said over 15 million tons of oil was extracted last year but this year’s plan is for just 12 million tons. In the first quarter, oil extraction fell by 600,000 tons.

Thu said if oil and gas output had reached the same level as last year, economic growth in the first three months would have been 5.95%, higher than the first quarter last year .

“The decline is part of the government’s fundamental solutions to ensure macro-economic development. Major economic balances, particularly in finance and state budget, continue to be secure while inflation has been under control,” Thu explained.

Economic indicators in the first quarter showed slow growth in industry and construction, 3.85% and 4.1% respectively.  

At the monthly government meeting for March, Prime Minister Nguyen Xuan Phuc reiterated the government’s intention to target a GDP growth of 6.7% for the year.

Minister and Chairman of the Government Office Mai Tien Dung mentioned solutions to achieve the goals: “Top priority should be given to stabilizing the macro-economy. But inflation, public debt, and foreign exchange and monetary policies should be given due attention.”

“We need to boost the development of industry, support industry, and high-tech agriculture. The government is keeping a GDP growth target of 6.7% but this should be sustainable growth with a focus on production growth. The mining industry should be promoted and preserved as a national asset rather than trying to achieve a high growth rate at any cost,” Mr. Dung said.

In the first quarter, Vietnam attracted more than US$7.7 billion in foreign investment, up 78%. 26,500 new enterprises were established, an increase in both number of enterprises and amount of registered capital.  

Sustainable exports towards added values

In the first 4 months of this year, Vietnam earned more than US$43 billion from exports, up 13% from last year.

Vietnam will likely have major opportunities to increase its export revenue when free trade agreements it has signed come into force. But in addition to opportunities, restructuring will be needed to sustainably increase export values. 

In recent years Vietnam has become a country with high export turnover, but the added value remains modest, largely because Vietnam’s main export items are in the form of raw or roughly processed materials.

Nguyen Quang Phi Tin, Sales Director of the TH True Milk Group, said “We are studying several markets, including Laos, Myanmar, and Indonesia, to find new opportunities to expand our trade promotion. When you plan to invest in a group of products, you must abide by international rules and standards. When your products are sold on the world market, they must meet all regulations set by the WTO and the world.”

The group is one of the few Vietnamese enterprises to have successfully promoted its products to 40 countries around the world.

When global demand falls, so does Vietnamese export revenue. Rapid restructuring of export items is called for. Export commodities are already changing. Industrial products now account for 80% of export value.

But industrial goods are processed while agricultural products are mostly unprocessed and therefore have less added value. Some agricultural exports face problems related to food hygiene and safety.

Tran Thanh Hai, Deputy Director of the Export-Import Department of the Ministry of Industry and Trade, said export items must be given greater added value. This has become more urgent than ever and Vietnam is now giving priority to developing its auxiliary industry and applying advanced technology to production and market development.

“For businesses, market development is mainly a matter of trade promotion, advertising, and branding. They should do all this on their own. In addition, they should strengthen links between businesses to strengthen the entire business community,” said Hai.

Economist Vo Tri Thanh said the State should create more incentive policies to boost support industries for mechanical engineering, component manufacturing, garments, textiles, and footwear so as to increase the locally made ratio.

To increase the value of agricultural exports, contracts should be signed between farmers, cooperatives, and enterprises to create production/consumption chains.

Thanh underscored the need to build stable, high-yield materials areas and step up the application of technology to production to raise the value of exported goods.

He said “Trade promotion, especially to bigger, stronger countries, plays an important role. To improve branding and increase the added value of Vietnamese goods - especially exported goods and services - we should improve our resources, create links between localities, and strengthen connectivity with external partners.”

The goal will also require close coordination between ministries and agencies in reforming export-import procedures and creating a healthier, more competitive business environment.

SME development fund offers 560 billion VND aid package

The Small- and Medium-sized Enterprise (SME) Development Fund has launched a financial aid package worth 560 billion VND (24.64 million USD) for SMEs, according to the Ministry of Planning and Investment (MPI).

The package is designed to support SMEs in reform and innovation; assist businesses operating in agriculture-forestry-fisheries, processing-manufacturing, and water supply, waste and wastewater management and treatment.

In 2017, the fund will continue joining hands with localities, business associations, banks, and related financial organisations to organise workshops and consulting programmes for SMEs, helping them design business plans to apply for loans and use the capital effectively.

According to the MPI, a draft law on supporting SMEs will be submitted to the National Assembly’s upcoming plenary meeting in late May for discussion.

Under the draft law, the SME development fund will provide lending and sponsorship for start-ups, invest in startups in innovation and mobilise domestic and international resources to support SMEs.

The fund became operation in April last year.

Vietnamese entrepreneur shares experience at Global Summit of Women

Chairwoman of the TH True Milk Group Thai Huong shared experience in establishing and developing her company into a prestigious brand name at the Global Summit of Women 2017 in Tokyo, Japan, on May 12.

Discussions on the second day of the summit focused on the theme of “Stepping from the Brink: Recovering from Business Setbacks”.

In her speech titled “True Happiness”, Huong said the difficult but full-of-love childhood nurtured her dream of building a modern agriculture to bring prosperity to the Vietnamese people.

She decided to invest in producing fresh milk to provide domestic customers with a high-quality product, ensuring food safety and hygiene.

The TH True Milk Group has a strong determination to create dairy products with international standards in Vietnam, she said, adding that the right moves, the group has overcome obstacles and seized opportunities to reap impressive achievements.

Thanks to the application of European cutting-edge technologies, the company is accounting for over 40 percent of the dairy market in Vietnam. Along with dairy products, others produced by TH True Milk such as FVF vegetables and TH Herbals have been certified as organic products by Europe and the US.

During the session, female entrepreneurs from the US, Japan and the Philippines shared their experience in overcoming difficulties to successfully do business.

The Global Summit of Women is taking place in Tokyo from May 11-15, with discussions on speeding up women’s ascent to business leadership, scaling up the growth of women-owned enterprises, opening up the global market to women in business, moving more women into technology industries and fostering support policies for women. 

As many as 1,300 female delegates from over 60 countries and territories over the world are attending the event.

HCM City seeks Hong Kong investment in infrastructure

Ho Chi Minh City will create favourable conditions for Hong Kong enterprises to invest in the city, particularly in urban infrastructure and transport, affirmed Tran Vinh Tuyen, Vice Chairman of the municipal People’s Committee.

As a major economic-social hub of Vietnam, Ho Chi Minh City needs cooperation and investment for its development from various sources, including foreign investors, Tuyen said at a reception on May 12 for a delegation of Hong Kong businesses, led by Chairman of the Hong Kong Trade Development Council Vincent Lo.

He also suggested Hong Kong firms and local agencies enhance share information and work together to seek a cooperation mechanism that suits Vietnam laws, conditions of the Hong Kong businesses and demands of the city, thus creating long-term relations that benefits both sides.

For his part, Vincent Lo affirmed that Hong Kong firms wish to establish close ties with the city in infrastructure field through investment, consultancy provision, construction and management of public transport, health care and education facilities.

They also want to contribute to development of the city through investment and technology exchange in tourism and commodity productions, he noted.

With 407 projects worth 2.5 billion USD on real estate and processing industry, Hong Kong businesses now rank seventh among countries and territories investing in Ho Chi Minh City. 

In the first four months of 2017, Hong Kong investors received licences for 16 new projects in the city with total value of 11 million USD, tripling the figure for the same period last year.

Mekong delta seafood firms urged to invest in India

Mekong delta An Giang province and India have good prospects for co-operation in aquaculture and processing, a meeting between business executives from the two sides heard in Ho Chi Minh City on May 12.

Smita Pant, the Indian consul general in HCM City, said An Giang and other provinces in the Mekong Delta region possess certain advantages in farming and processing, especially of basa.

Vietnamese fisheries products are exported to many markets and India is a huge market with a population of 1.2 billion.

The Indian Government offers incentives to foreign investors in aquaculture and seafood processing, especially in Andhra Pradesh, Odisha and Tamil Nadu states, she said.

She called on An Giang to send a delegation of leading seafood firms to the three states to do market research and explore investment opportunities, especially in projects to produce basa brood stock.

Ramesh Anand, managing director of Canopus Inter-Trade Pte Ltd, said the Indian market also offers good opportunities for An Giang firms to export basa products.

Vietnamese basa fish fillet is already available at many five-star hotels in India, he said.

Seafood demand is quite high in India, but businesses need to offer competitive prices, he said.

Nguyen Thanh Binh, Deputy Chairman of the An Giang People’s Committee, said his province is strong in agriculture, with rice, fish, fruits, and vegetables being the key items.

The province would send a delegation to India to study the market and boost exports of basa and invest in aquaculture, he told the media on the sidelines of the event.

Besides its traditional markets, the province also seeks to boost basa exports to other markets with high demand, including India, he said.

The An Giang and Indian businesses also discussed co-operation in IT, agro-chemicals, vegetables and fruits, human resource training, and tourism.

An Giang University sought tie-ups for training IT engineers to international standards, carrying out research into the internet of things for agriculture, e-governance and others and exchanging students and researchers.

The province sought Indian investment in tourism, especially in developing four- and five-star accommodation, theme parks, cuisine areas, and trade and convention centres.

Binh said trade between the province and India was worth nearly 8 million USD in 2016, with the province’s exports accounting for more than 2 million USD.

The numbers are modest, and there is room for much greater trade ties, he said.

Such interactions are a good opportunity for businesses from the two sides to exchange information and explore opportunities, he added.

UK agency vows to fund HCM City’s development projects

The United Kingdom Export Finance (UKEF) is willing to provide financial support to development projects in HCM City, including big and long-term ones, said UKEF Chief Executive Louis Taylor.

Taylor made the remarks during the meeting with Permanent Vice Chairman of the Ho Chi Minh City People’s Committee Le Thanh Liem in the city on May 12.

Liem said he appreciates UKEF’s interest in local urban transport development projects such as the city’s metro system project, line 6, asking the UKEF to study an effective funding mechanism for such projects.

The vice chairman also invited UK enterprises with experience not only in urban transportation but also in healthcare and education to invest in the city, placing the emphasis on the private-public partnership (PPP) project to construct an area for medical examination and treatment at Nguyen Tri Phuong Hospital.

He suggested the two sides cooperate in human resources training and transfer of advanced education curriculum.

For his part, Taylor agreed to look into the possibility of participating in the city’s development projects, particularly those in urban transportation, healthcare and smart city.

The UKEF will work with relevant state agencies from the UK and soon contact local authorities to discuss appropriate partnership mechanisms between the two sides in the coming time.

The United Kingdom is now HCM City’s 12th biggest investor. It is also among the city’s large trade partners with two-way trade estimated at 816 million USD. The bilateral trade reached 210 million USD in the first four months of 2017.

APEC committee appraises trade, investment issues in Hanoi

The APEC Committee on Trade and Investment (CTI) commenced meetings on May 13, as part of the second APEC Senior Officials’ Meeting (SOM 2) and related meetings in Hanoi.

At the CTI meetings, participants from APEC member economies are scheduled to discuss content of the statements set to be approved at upcoming meetings, including the Ministers Responsible for Trade Meeting, the APEC Ministerial Meeting, and the APEC Economic Leaders’ Meeting. 

They will also debate APEC’s contributions to the WTO’s 11th Ministerial Conference.

The delegates will give opinions on the schedule for the making of reports on the member economies’ progress in the realisation of the Bogor Goals, APEC’s post-2020 vision on trade and investment, the working plan for 2017 on the Asia-Pacific Free Trade Agreement, and the framework document on the facilitation of cross-border e-commerce.

During three working days, the CTI will also look into the connection of supply chains, including the implementation and supervision of the realisation of the second phase of the Supply Chain Framework Action Plan.

Other issues on the agenda include regional economic integration, trade connectivity and facilitation, and promotion of reforms in APEC.

In a preliminary report on the second phase of APEC’s progress towards the Bogor Goals, the APEC Policy Support Unit said from 1994 to 2014, the trading of commodities in the region grew by 7.8 percent annually on average to 18.4 trillion USD in 2014. Notably, intra-APEC trade surged four times. Trade revenue in the service sector also posted an annual growth rate of 7.6 percent.

The region’s average most-favoured nation tariff fell by almost a half, from 11 percent in 1996 to 5.5 percent in 2014. The rate of products benefiting from zero-percent tariff rate in APEC increased from 27.3 percent in 1996 to 45.4 percent in 2014.

By the end of 2015, APEC member economies participated in 152 free trade agreements and regional trade agreements, 61 of them were inked between the member economies.

Work starts on first electronic component factory in Phu Yen

The CCIPY Vietnam Co., Ltd, a member of US-based Coilcraft Group, started construction work on a factory manufacturing electronic components at An Phu Industrial Park in Tuy Hoa city, central coastal Phu Yen province on May 13.

It is the first factory of its kind located in Phu Yen. It has a designed capacity of 500 million items per year and mainly produces RF wirewound chips and electromagnets, all for exports.

Director General of CCIPY Vietnam Koo Heng Sheong said the 5.7-million-USD factory is part of Coilcraft’s goal to develop production in Asia.

The facility, which covers an area of 2.7 hectares, will be put into use in January 2018, offering job opportunities for about 2,000 local workers.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR