Site clearance for the Long Thanh International Airport project in the southern province of Dong Nai is facing a shortfall of a hefty VND18 trillion (US$793 million), according to a report which Minister of Planning and Investment Nguyen Chi Dung has sent to the National Assembly (NA).

He said in the document that his ministry would be working with the ministries of finance and transport to find ways to cope with the capital shortage, and that the ministry might ask the Government to seek the NA’s approval to tap medium-term public investment reserves if need be.

Resettlement and site clearance compensation for the big-ticket project will need over VND23 trillion, according to a report of Dong Nai Province. Earlier, the NA allowed the project investor to use VND5 trillion from G-bond sales in the 2017-2020 period. 

In the report, Minister Dung said it is difficult to mobilize VND18 trillion, and that medium-term public investment capital allocated to the Transport Ministry has not matched growing demand, especially of major projects.

As covered by the Daily, the airport project is divided into three stages. During stage one, a runway and a passenger terminal along with other components will be developed, with a capacity of 25 million passengers and 1.2 million tons of cargo a year. They would be up and running by 2025.

A second runway and a second terminal will be constructed in the second stage to raise the airport’s annual capacity to 50 million passengers and 1.5 million tons of cargo. In the final stage, the remaining components will be put in place, and the airport will be able to handle 100 million passengers and five million tons of cargo a year.

The total cost of the entire project is estimated at VND336.6 trillion, with the first stage requiring VND114.45 trillion.

The Transport Ministry is responsible for the project’s pre-feasibility study which will be presented to the NA for consideration. It is scheduled to get off the ground in 2019, and come into operation in 2023.

S.Korea firms say customs rules still bothersome

South Korean business executives in a dialogue on June 13 with the HCMC Customs Department complained the prevailing customs regulations are difficult to comply with and requested such rules be further streamlined.

Nguyen Manh Hao of Samsung Electronics said the current rules require the company to declare purposes of using materials in the customs form but this is an impossible mission since the company uses up to 50,000 different types of material in its production process. Hao said the company cannot give exact calculations for each purpose, i.e. for export or for domestic sale.

He therefore suggested that all materials imported by Samsung be first assumed as for export processing. By the end of each month, depending on domestic sales, the company would make clear the volume of material used to make goods for local consumption.

Another enterprise mirrored another problem when complying with the Vietnam-Korea Free Trade Agreement (VKFTA). Under this FTA, commodities subject to preferential tariffs must be transported direct between the two countries but given the absence of direct shipping services between the two countries, commodities often come to Vietnam through a third country.

When customs officers scrutinize shipping invoices and find out that shipments are not transported direct from Korea to Vietnam, they will deny preferential tariffs for importers, the representative said.

In addition, some companies complained about the inconsistent interpretation of regulations in different parts of Vietnam.

Speaking at the dialogue, Hoang Viet Cuong, deputy director of the General Department of Vietnam Customs, said all complaints lodged by enterprises in the dialogue would be forwarded to the General Department and the Ministry of Finance for resolution.

Kim Heung Soo, chairman of the Korean Chamber of Commerce and Industry (KOCHAM) for the southern and central regions in Vietnam, said at the meeting that Korean firms are much upbeat about the business climate in Vietnam. In HCMC, there are over 1,000 active Korean enterprises.

A survey conducted by KOCHAM shows 46.1% of Korean companies say they will expand business in Vietnam, while 71% say they are happy with their business performance in Vietnam.

Power consumption seen surging to record high

The nation’s electricity consumption in June is forecast to amount to a record high of 31,500 MW as hot weather has driven up demand for air-conditioning and ventilation, said Vietnam Electricity Group (EVN).

Electricity supply reached an all-time high of 30,182 MW on June 2.

EVN said the 500kV north-south power line has been operating at full capacity to ensure sufficient power for production and household activities. Coal and gas-fired power plants in the country’s south have been mobilized to meet the surging power demand.

Coal-fueled power stations in the south, especially Vinh Tan 2, Duyen Hai 1 and Duyen Hai 3, have been put on standby.

The group said it would also commission the second generator of Vinh Tan 4 thermal power plant, the fourth generator of Trung Son hydropower plant and the first generator of Thai Binh thermal power plant.

To prevent local power lines from being overloaded, electricity companies will not cut power supply for grid repair. EVN encourages households to use electricity economically by restricting the use of high-capacity devices and setting the optimal temperature for air-conditioners at 26 degrees Celsius.

According to the national weather center, northern and central provinces may have one or two heat waves in June. At the beginning of the month, a hot spell from the west and hot and dry winds in northern and central provinces from Thanh Hoa to Phu Yen led temperatures there to shoot up to 37-42.5 degrees Celsius.

Techmart Online features tech solutions

The HCMC Center for Science and Technology Information has launched Techmart Online at techmartvietnam.vn where equipment and tech solutions can be bought and sold.

The website is aimed to facilitate online transactions of equipment, tech solutions and research, according to the center. Requests for equipment and solutions from enterprises will also be posted on the site.

The center aims for 5,000 products on the site next year.

As a business-to-business platform Techmart Online is where the seller and the buyer can conduct commercial transactions.

The site also allows users to contact around 100 consultants active in law, technology assessment and evaluation, and intellectual property.

The platform assists individuals and startups with novel business ideas or projects to sound out business opportunities with other companies and investors.

BIDV MetLife & ISA hold digital insurance workshop

A digital insurance workshop was co-hosted recently by the Insurance Supervisory Agency (ISA) and BIDV MetLife, to discuss the challenges and opportunities in the development of Vietnam’s insurance industry, at which global giant insurer MetLife and related parties committed to contribute to the development of digital insurance in the country.
Figures from MetLife Asia shows that Vietnam’s middle class will increase 2.5-fold by 2020 to 34 per cent of the population and will therefore lead to higher use of smartphones.
Vietnam is expanding its 3G network and transitioning to 4G. About 52 per cent of the population have access to internet, which will be as high as two-thirds by 2020.
Two-thirds of existing internet users spend five hours a day surfing the web for news, exchanging information, and communicating on social networks. Eighty per cent read online news, communicate on social networks, and use e-commerce.
Vietnam has among the fastest growth in people using social networks in the world, at 31 per cent during the 2016-2017 period, behind only India and Indonesia, with 40 per cent and 35 per cent, respectively, and well above the global average of 21 per cent.
While growing rapidly, e-commerce still accounts for only a small amount of total retail sales in Vietnam, standing at 1.2 per cent in 2017 and projected to increase to 1.5 per cent by 2020.
Regardless, when users adapt to using digital services, especially e-commerce, the financial services being provided will develop and become popular, including insurance services.
By 2020, Asian life insurers will digitally communicate with customers, with 100 per cent of communication being via phone and email, 90 per cent via mobile phone apps, and 80 per cent via social networks, according to MetLife Asia’s research.
But there are five immediate steps needed for digital insurance to develop in Vietnam: raising customer awareness, and improving distribution channels, types of insurance products, requirements regarding technological foundation, and the legal framework.
MetLife stands ready to provide specialists to support ISA during the process of developing the legal framework and technical systems to implement digital insurance in Vietnam.
Founded in 2014, BIDV MetLife Life Insurance is a joint venture between MetLife, BIDV, and BIDV’s affiliate, the Bank for Investment and Development of Vietnam Insurance JSC (BIC). BIDV MetLife offers a comprehensive range of innovative life insurance and wealth protection solutions distributed through BIDV’s large branch network of over 700 distribution points nationwide.
This cooperation between BIDV and MetLife is set to combine and uphold the advantages of all parties. The understanding of the domestic market held by BIDV, together with the solid financial capacity and global experience of MetLife, provides the foundation for BIDV MetLife to become a trusted and modern insurance provider in Vietnam.
MetLife is among the largest global providers of insurance, annuities, and employee benefit programs, with nearly 100 million customers in over 50 countries, with a leading position held in Japan, Latin America, Asia, Europe, and the Middle East.

NEU & BTCI to cooperate in banking and finance training

The National Economics University (NEU) and the Institute of Manpower, Banking and Finance (BTCI) signed a cooperation agreement on practical training for the banking and finance industry on June 14 in Hanoi.
Together with representatives from the NEU and the BTCI, the signing ceremony was witnessed by representatives from The Banking Strategy Institute, the State Bank of Vietnam (SBV), the World Bank (WB) in Vietnam, the International Finance Corporation (IFC), and other related parties.
The NEU will provide BTCI’s “Future Bankers” training program to students in its Advanced-Educational Programs.
The “Future Bankers” program gives students the opportunity to be exposed to practical studies in banking jobs and is unlike other forms of internships, which lack tutoring and real-life practice.
Students are supported directly by experienced bankers in classroom training and on-site coaching at bank branches and transaction offices in the roles of personal relationship managers, tellers, and assistants for corporate banking relationship offices.
Associate Professor and Principal of NEU, Dr. Tran Tho Dat, told the ceremony that this is a major step in linking human resources and training units in the banking and finance sector. “The program will help students have better job opportunities at commercial banks, while banks will have better human resources in the future,” he added.
The BTCI program being recognized by a prestigious university is a significant step forward in its mission of matching business requirements and the training of human resources.
“Future Bankers” is a pre-employment training program developed in line with the quality accreditation process and guidelines of the Dutch Institute for Banking Insurance and Investment (NIBE-SVV) in 2010 under a TA project funded by the Netherlands Development Finance Company.
The program is designed on the basis of competencies and skills required for certain jobs in the banking environment, ensuring “Future Banker” graduates will perform well immediately upon being employed, thus optimizing their performance while saving substantial cost, time, and resources for banks.   
BTCI was established by ten commercial banks on November 30, 2001 as an initiative of the Mekong Private Sector Development Facility (MPDF), the IFC, and the SBV. Over last 15 years, it has trained an impressive 100,000 bankers through thousands of international-standard training courses.

Kahuna to make waves at Ho Tram

Ho Tram Project Company (HTP) today announced the development of the third phase of its Ho Tram Strip project, its residential tower, condotel and villa development.

Kahuna Ho Tram Strip, is a 244-key development located adjacent to the north-side of The Grand and will feature a combination of 164 one and two bedroom condominiums as well as eight penthouses located inside a 12 storey tower, as well as 44 premium beach villas, ranging in size from 218 to 223 square metres.

Named for the legendary waves of Hawaii, Kahuna continues HTP’s long history of bringing world class entertainment and hospitality offerings to Vietnam.

“The company that first brought Vegas to Vietnam, brought the best Asian Tour event that the golfing world has seen is today thrilled to announce that we are riding that Hawaiian wave across the Pacific and on to the shores of Vietnam with our new residential development,” said HTP’s executive chairman Michael Kelly.

“We have made it our primary focus to ensure that Ho Tram is Vietnam’s entertainment capital, and in line with this, The Grand has unveiled countless new lifestyle amenities. We are viewing Kahuna as an extension of this.  This is not just another residential development, this is a chance to be a part of all of the energy that has made the Ho Tram Strip what it is today,” Kelly continued.

The company, which also offers the course-side residential Gallery Villas, located on its adjacent golf course, The Bluffs, has been extremely active in the past year. Its second hotel tower – The Beach Club - is quickly rising and is set to begin welcoming guests to its 559 rooms early in 2018; and plans are underway for the commencement of facilities ranging from waterparks and amphitheaters to HTP’s planned international private airport. 

Pricing for condominiums begins from $88,800, while villas begin at $350,000.

Kahuna has been designed by leading Ho Chi Minh City-based architectural firm Korn Architects and anticipates breaking ground in the fourth quarter of this year.    

HTP - a wholly owned subsidiary of Asian Coast Development Ltd. - is the largest international investor in Vietnam’s rapidly expanding tourism industry, and among the largest private-equity US investors operating in the nation today. 

It has thus far deployed and committed over $1.1 billion of the total $4 billion investment it intends to make into the Ho Tram Strip project. The Grand Ho Tram Strip houses Vietnam’s first international-standard casino which was the first official facility licensed to offer live gaming to foreign patrons from the resort’s opening four years ago. 

Hanoi’s notorious apartment project to be revived?

The Daewoo Cleve project located in Van Phu Urban Area in Hadong district of Hanoi has come back with a new name, a new look, and a new investor after a long hiatus. However, the fate of the project is still not clear.
Daewoo Cleve, developed by Hi Brand Vietnam Company Limited, a subsidiary of South Korean construction company Inpyung, has an investment value of $421 million. The apartments in the project were launched at the end of 2011 at the price of about VND30 million ($1,320) per square metre.

According to the introduction of the developer, the project includes 15 high-rise apartment buildings of 36-40 stories, with areas of about 93-163.1 sq.m of each unit inside. The construction started in October 2010. The developer expected to complete CT2A and CT2B buildings at the end of 2013 and the beginning of 2014, respectively, and the whole 15 buildings were scheduled for completion by 2018.

The project is located at a prime location in Hadong district and is developed by a famous South Korean company. Buyers of the project were also offered attractive sales policies in which they could borrow up to 25 per cent of the apartment value at preferential interest rates. Since January 2012, buyers in the project could also borrow 25 per cent of the apartment value from the developer at 1 per cent a month, or 12 per cent a year, while bank lending rate at that point was 20 per cent a year.

However, the project was launched when the high-end apartment market was in difficulty and amidst financial troubles at the South Korean parent company, so the project ran out of capital. When construction reached the sixth floor at the two buildings at the end of 2012, it stopped and never resumed. In mid-2014, buyers in the project protested because the developer was slow to hand over the apartments as committed.

In July of the same year, Hi Brand Vietnam announced that it would resume construction before December 2014 and hand over apartments to buyers in the fourth quarter of 2016.

In the end, the developer failed to honour these promises. In August 2014, Hi Brand Vietnam asked for permission of the Hanoi People’s Committee to decrease the number of stories and received authorisation in September. People thought the developer would resume the project, but then the company removed all the machinery from the construction site and stopped all activities.

When the Hanoi real estate market recovered at the end of 2014 and grew more in 2015-2016, many projects resumed construction. Daewoo Cleve was not one of them.

In May this year, CEN Group subsidiary Century Real Estate Investment and Development Joint Stock Company (CENInvest) and Hi Brand Vietnam out of the blue announced signing a cooperation agreement on developing The K-Park Hadong project. This project has three high-rise apartment buildings of 23, 25, and 27 stories with a common basement.

Pham Thanh Hung, deputy chairman of CEN Group, said this is a part of the Daewoo Cleve project that CEN Group bought from Hi Brand. At the same time, Hi Brand announced the La Casta detached housing project with 359 low-rise houses, including 199 shophouses. This new project is another part of the Daewoo Cleve project.

Real estate agents said in case CENInvest successfully implements the three buildings of The K-Park, it will consider buying further parts of the suspended Daewoo Cleve.

CENInvest is residential property developer in the north and south of Vietnam, including Thang Long Garden, CT2A, HHB Tan Tay Do, Helios Tower, Park View Residence, The Golden Palm (Hanoi) or the Le Thanh apartment building in Ho Chi Minh City.

Whether CENInvest will be able to revive Daewoo Cleve remains to be seen.

“Projects that have been on hiatus for a long time often have deep problems. Maybe the product is not correctly targeted and it cannot be changed. Maybe there are a lot of debts to banks or old customers, or the old developer has low capacity,” commented a manager at a real estate developer that recently revived a project on Pham Hung Street of Hanoi. “Therefore, the new investor has to solve these problems from the root. That is the only way to ensure liquidity.”

HCM City to host seeds exhibition
     
A seeds exhibition will open at HCM City’s Biotechnology Centre in District 12 on June 22, with more than 140 exhibitors from 12 cities and provinces showcasing their products.

It will have 350 booths also displaying aquaculture and livestock brood stock and farming machinery and equipment.

Tran Tan Quy, deputy director of the city’s Department of Agriculture and Rural Development, said the exhibition would showcase quality seeds and brood stock suitable for local conditions.

Several seminars and conferences are scheduled to be held on the sidelines of the event, including a conference on investment promotion and technology transfer in agricultural production to be held on the opening day.

The exhibition will also feature orchid and bonsai competitions.

Quy said it would offer opportunities to localities, businesses and co-operatives to meet, compare notes and explore opportunities in agricultural production and trading and promote Vietnamese agricultural brands.

The event, organised by the department, will run until June 26.

TPBank launches eBank BIZ 3.0
     
Tien Phong Bank Joint Stock Commercial Bank (TPBank) on Wednesday launched its eBank BIZ version 3.0 offering several breakthroughs in ebanking services for businesses.

Companies using the eBank BIZ 3.0 can implement almost banking transactions with digital signatures without going to the bank.

The eBank 3.0 has been supplemented with many new functions such as international money transfer – eGlobal, credit granting, guarantee and open letter of credit (LC) aiming to become TPBank’s key products in digitalizing banking transactions.

The biggest breakthrough was to integrate digital signatures in e-transactions instead of traditional certifications of Hard Token, eToken and SMS OTP to increase security.

In addition to normal services including deposits, payments and money transfers, businesses will not need to go to the bank for credit granting, guarantee and LC. Foreign currency trading will be also implemented online. TPBank is the first local bank in Viet Nam to provide international money transfers online.

TPBank’s general director Nguyen Hung said all of the transactions could be implemented online on a computer or mobile phone.

The eBank 3.0 is available on the App Store and Google Play. 

Viet Capital Bank’s cheap loans for small firms
     
Viet Capital Bank has earmarked VND600 billion (US$26.38 million) for lending to small and medium-sized enterprises based in HCM City and the north at an interest rate of 7 per cent.

Under a programme called ‘Connecting Viet Capital Bank with SMEs,’ new SME customers and those who have repaid their old loans at least six months ago can borrow up to 80 per cent of the value of their mortgage.

There is no penalty for early loan repayment.

The programme will be implemented from now until December 31.

For more information, customers can contact the bank’s hotline at 1800 555 599 or its branches around the country. 

Garment, footwear exports fetch $15bn in five months
     
Exports of garment and footwear products reached US$15 billion in the first five months of this year, accounting for 19 per cent of the country’s total export turnover.

This was revealed by the latest statistics from the General Department of Customs.

Of the total revenue, the five-month garment export hit $9.39 billion, surging 9.1 per cent against the same period last year, the major markets being the US with a turnover of $4.58 billion, up 6.9 per cent; the EU with $1.3 billion, up 4.9 per cent, and Japan with $1.14 billion, up 10.3 per cent.

Meanwhile, footwear export in the period saw a yearly rise of 12 per cent to $5.65 billion. The leading importers of Vietnamese footwear products included the US with a value of $1.99 billion, up 13.2 per cent; the EU with $1.8 billion, up 8.7 per cent, and China with $418 million, up 29.1 per cent.

By the year-end, local garment industry is eyeing 6.5 per cent to 7 per cent export growth to more than $30 billion, while the footwear sector hopes to bring home $18 billion, a yearly rise of 10 per cent. 

Emirates Airline offers discount tickets on flights between Vietnam and EU

Dubai’s Emirates airline has announced a promotion program with discount tickets on flights between Hanoi and Ho Chi Minh City to European destinations.

Accordingly, the discounts will be applied to tickets bought from now through June 30 for departures before August 23, 2017.

The cheapest tickets applied to flights from HCM City to Moscow and St Petersburg in Russia, and from Hanoi to Stockholm and Copenhagen in Sweden are from US$617 (VND14.2 million), including taxes and fees.

Airfares will be more than US$652 (VND15 million) for flights from HCM City to Oslo, nearly US$695 (VND16 million) for flights from Hanoi to Milan, US$730 (VND16.8 million) for flights from Hanoi to Bologna and US$756 (nearly 17.4 million) for flights to Nice.

Summer is a good time to visit Europe as a wide range of festivals will take place across the continent like the Genzano Infiorata Flower Festival in Italy and Outline Festival in Russia.

Emirates Airline is conducting daily flights departing from Hanoi and Ho Chi Minh City. It has offered direct flights between HCM City and Dubai since 2012 and will open direct flights between Hanoi and Dubai on July 2, 2017. From Dubai, passengers can then fly directly to destinations in Europe.

Who owns the Tan Son Nhat Golf Course?

Members of the public have been wondering who the real owner of the headline-grabbing Tan Son Nhat Golf Course is.

Developed by the Hanoi headquartered LOBICO, the course is situated on a 157 hectare property adjacent to the city’s Tan Son Nhat international airport, and is now accused of hindering its expansion.
LOBICO was founded in 2006 with Ministry of National Defense-run development company, Truong An Development and Investment construction JSC, among its shareholders.

However, according to data reviewed by Tuoi Tre (Youth) newspaper, by the time the golf course was opened to the public in August 2015, Truong An had divested its share, and ownership was spread amongst several different shareholders.

LOBICO obtained its founding license from the Hanoi investment department in May 2006. According to the license, the company had an initial registered capital of VND200 billion (US$8.81 million), with four major stakeholders, the military-run Truong An Development and Investment Construction JSC, the Him Lam Co. Ltd., the Thanh Nam Trade Construction Co. Ltd., and the Bao Loc Investment Construction Co. Ltd.

The Him Lam Co. Ltd is now known as Him Lam Corporation.

By November 2007, LOBICO had doubled its chartered capital and as of March 2014, had only three shareholders, including Truong An and two private individual investors.

At that time, Truong An JSC owned 15 percent of the business, while Tran Van Tinh, Him Lam Corp’s general director, possessed a 48.5 percent stake, and Duong Thi Liem, a member of the Him Lam Corp board of directors, had 36.5 percent.

As of November 2014, LOBICO increased its registered capital again to VND950 billion ($41.85 million), with Tinh maintaining his 48.5 percent share. Liem’s stake in the company had reduced to only 10 percent.

At this point in time, the defense ministry-run Truong An JSC was no longer a LOBICO stakeholder. The company instead attracted two new private shareholders, Le Thi Bich Ngoc, the director of business at Him Lam Corp, who held 26.5 percent, and Him Lam Real Estate Business, which owned 15 percent.

This meant that LOBICO effectively became part of the “Him Lam family,” with all four stakeholders having a relationship with Him Lam Corp.

It should also be noted that Tran Van Tinh is the cousin of Him Lam Corp chairman Duong Cong Minh, and Duong Thi Liem is Minh’s younger sister.

And so it was that nine months after coming under the full ownership of the “Him Lam family,” LOBICO inaugurated the Tan Son Nhat Golf Course, answering the question of who owns it.

Now, having come under such scrutiny, experts say the land should have been used to make more space available for the overloaded Tan Son Nhat airport.

Vietnam’s busiest airdrome receives 32.5 million passengers per year, which is well in excess of its design capacity of 25 million.

Amid growing concern that a golf course has effectively hindered the airport’s expansion, Prime Minister Nguyen Xuan Phuc has requested that an urgent feasibility study be conducted on adding a new runway to the international terminal.

Results of the study must be reported to the government within six months, the premier said on June 12.

Consumer loans rise nearly 30% by end May

Consumer lending by end May rose 29.7 per cent against the end of 2016, the National Financial Supervisory Commission (NFSC) has said.

consumer loans rise nearly 30% by end may hinh 0 Of the total consumer loans, home renovation loans and home purchase loans accounted for 52.8 per cent, compared with 49 per cent in the end of 2016.

As per the NFSC’s report, credit growth of the entire banking system was positive, reaching 6.8 per cent in May, compared to 5.7 per cent in the same period in 2016. In particular, the lending terms have changed towards fewer medium-term and long-term loans. The proportion of short-term loans was estimated at 45.4 per cent, against 44.9 per cent in late 2016. Meanwhile, the proportion of medium- and long-term loans fell to 54.6 per cent, against 55.1 per cent.

Lending in Vietnamese d?ng accounted for nearly 92 per cent, while lending in foreign currencies fell slightly to 8.2 per cent of the total lending from 8.4 per cent in late 2016.

At the end of the first quarter of 2017, the banking sector continued to be the economy’s main source of capital supply, accounting for nearly 60 per cent of the total capital supplied via the financial market.

The NFSC reported that as of now, liquidity troubles have declined. The ratio of loan to deposit (LDR) of the entire banking system was 87 per cent as of May, slightly lower than earlier. Inter-bank interest rates have also fallen to 4-4.2 per cent per year from the previous 5 per cent. The State Bank of Vietnam withdrew VND28 trillion (US$1.22 billion) in May.

According to the NFSC, the positive liquidity status is because of a rapid rise in State Treasury deposits as budget disbursement remains slow. As of late April, State Treasury deposits reached VND122 trillion, up 28.4 per cent against the beginning of the year.

Coffee exports reduce in volume but grow in value

Coffee exports dipped 13.9% to nearly 709,000 tons with revenue jumping 13.7% to US$1.6 billion in the first five months of this year, according to the General Department of Vietnam Customs.

coffee exports reduce in volume but grow in value hinh 0 Major coffee importers in the period included the EU (332,000 tons valuing US$734 million, down 10.2% in volume but up 16.8% in value), the US (down 1.6% to 105,000 tons with a value up 30.6% to US$238 million) and Japan (down 6.8% to 41,000 tons with a value up 19.4% to US$95 million).

The Ministry of Agriculture and Rural Development said the average export price in the first four months was US$2,267 per ton, up 33.5%.

In the domestic market, the price of coffee bean also rose 4 cent (VND900) to US$1.8 (VND43,000) per kilo.

Last year, Vietnam exported 1.79 million tons of coffee to get US$3.36 billion, up 33.6% in volume and 25.6% in value against 2015.

It is predicted that this year coffee exports will drop in both volume and value as a result of extreme weather. Coffee output is expected to hit around 1.3 million tons, down 20-30% compared to last year.

Early this year, the International Coffee Organization predicted that the world coffee industry will continue to witness output decline for the third consecutive year.

Vietnam looks to improve bidding transparency

The bidding grievance handling mechanism needs to be renovated to ensure transparency and keep pace with the country’s rapid international integration, said Deputy Minister of Planning and Investment Dao Quang Thu.

Thu addressed an international workshop on independent procurement grievance handing mechanisms in Vietnam co-organised by the Ministry of Planning and Investment and the World Bank in Hanoi on June 14

The workshop was an opportunity for policymakers to study international practices in grievance handling mechanism so as to raise amendments to the bidding regulations towards compliance with modernity.

Thu said that grievance handling mechanisms in Vietnam were revealed to have shortcomings, while the country’s rapid international integration requires more transparency in bidding or public procurement.

Le Van Tang, former Director of Bidding Management Department, said that it is critical to improve bidding transparency and the economic efficiency of using the State budget.

The Bidding Law 43/2013 already has significant improvements but still needs to be amended to keep pace with integration, Tang said.

A World Bank research shows that public procurement accounts for the biggest proportion of annual Government spending, at around 15-20 percent of gross domestic product (GDP) of countries around the world.

In Vietnam, public spending jumped from 28.5 percent of GDP in 2001-05 period to 29.73 percent in 2006-10. From 2011-13, the Government tightened spending with aims to stabilise the macro-economy and curb inflation, but spending remained high at 28.15 percent of GDP.

Tang said that an independent mechanism in grievance handling is critical to ensure transparency and efficiency in public procurement.

Nguyen Thi Thu Hien, deputy dean of International Trade Law Faculty, said that several bidding regulations remain muddled and obscure. “Vietnam needs to review and improve bidding regulations,” Hien said, adding that the foundation of an independent administrative agency for handling grievance should be put into consideration.

Accountability in bidding must also be enhanced, Daniel I. Gordon from George Washington University Law School added.

Dak Lak promotes sustainable coffee production

Coffee growers in the Central Highlands province of Dak Lak have applied internationally-recognised programmes on sustainable coffee production to raise their incomes, according to the provincial Department of Agriculture and Rural Development.

More than 40,500 coffee farming households in Dak Lak have produced coffee in line with programmes such as UTZ certificates, Common Code for Coffee Community (4C) and Rainforest Alliance Certified Coffee (RFA).

They have produced 226,000 tonnes of coffee beans on a combined area of 65,000 hectares each year, accounting for over 50 percent of the annual output.  

All ten units granted with the Geographical Indication of Buon Ma Thuot coffee have also joined certified coffee production programmes.

In Cu M’gar district, the main coffee growing locality in Dak Lak, almost 10,000 coffee farming households have taken part in certified coffee production programmes with 15,000 hectares, making up 45 percent of the district’s total coffee area.

These households have been provided with techniques in growing, caring, watering, fertilizing, harvesting, processing and preservation. They have been also instructed on how to reduce production costs and use fertilizers in order to minimize impacts on the environment.

Dak Lak province has led the nation in terms of both coffee area and output with more than 203,000 hectares and an annual output of at least 450,000 tonnes.

EVNGENCO 1’s output hits 12.4 billion kWh in five months

The Electricity of Vietnam (EVN)'s Power Generation Corporation 1 (EVNGENCO 1) produced nearly 12.4 billion kWh of electricity in the last five months, fulfilling 40.8 percent of the target set for the year.

In May alone, the company’s output approximated 2.5 billion kWh, up 20 percent over the same period last year.

The firm set to produce nearly 2.9 billion kWh of electricity in June.

EVNGENCO 1 said in May the corporation ensured the progress of investment projects such as the expanded Da Nhim hydropower plant, the 220kV Dai Ninh transformer station and the Duyen Hai thermoelectricity plant.
 
Total values of investment and disbursement for its construction projects in the first five months of this year reached 8.68 trillion VND (381.9 million USD) and 8.27 trillion VND (nearly 363.9 million USD), respectively. 

Notably, in May, EVNGENCO 1 arranged enough capital for the Ban Ve, Song Tranh 2, Dong Nai 3 and 4 hydropower plants, the coal port of the Duyen Hai electricity centre, and other infrastructure facilities. 

This month, the company continues ensuring the progress of its projects such as Dai Ninh station, the expanded Da Nhim hydropower plant, and Uong Bi thermal power plant. 

It will approve a feasibility report of a project to upgrade exhaust treatment system of the Uong Bi thermal power plant, while ensuring stable operation of turbines at the Duyen Hai 3 thermal power plant. 

EVNGENCO 1 will also work with the EVN to verify balance reports for projects to develop infrastructure at the Duyen Hai electricity centre, the expanded Uong Bi thermal power plant and the Song Tranh 2 hydropower plant, as well as submit a balance report for the phase 1 of the Duyen Hai electricity centre’s seaport project to the group .

Domestic gold prices rise slightly after Fed’s rate hike

The domestic gold market did not show much fluctuations on June 15 after the Fed raised its prime rates, with gold prices moving around the mark 36 million VND (1,586.5 USD) a tael (37.5 grammes).  

At 9am, major gold trader Doji group listed the buying price for SJC 24k gold bars at  36.34 million VND a tael and the selling price at 36.42 million VND a tael, up 50,000 VND (2.2 USD) a tael compared to late June 14.   

At the same time, the prices for SJC gold bars at Bao Tin-Minh Chau Company were 36.35 million VND (buying) and 36.41 million VND (selling) per tael, both up 20,000 VND (0.88 USD) from the closing prices on the previous day. 

Meanwhile, gold prices on the New York market dropped after the Fed’s move on June 14 while the greenback gained compared to other key currencies.

Also at 9am on June 15 (Hanoi time), the world gold price was at 1,265.6 USD per ounce. 

At the June 15 exchange rate of Vietcombank, the domestic price for one tael of gold is 2.5 million VND (around 110.17 USD) higher than the world price, excluding tax and other fees.

Foreign cosmetic exhibitors introduce products in HCM City

Nearly 200 cosmetics producers and firms from Japan, the Republic of Korea (RoK), Singapore, Hong Kong (China) and India are displaying products and services at the Mekong Beauty Show in Ho Chi Minh City.

The three-day event, which opened on June 15, aims to help exhibitors establish partnerships with potential importers, thus expanding markets for their products. 

Notably, 80 enterprises from the RoK – famous for its cosmetics, attended the event for the first time. 

Vietnam is considered one of the most promising cosmetic markets in the Mekong Sub-region as some 60 percent of the country’s population are young people under 35. 

The International Monetary Fund forecasted that four nations in the region including Vietnam, Cambodia, Laos and Myanmar, will reach a combined GDP of 441 billion USD by 2020. The region is an emerging market for consumption of beauty products with annual estimated growth of 30 percent.

According to Nguyen Van Minh, Vice Chairman of the Vietnam Association of Oil, Aromas and Cosmetics, the Vietnamese market consumes 2 billion USD worth of cosmetics per year. 

The number of middle-income consumers, who have high command for cosmetics in the country, is predicted to rise to 33 million by 2020.-

Vinh Long, Dutch firm boost cooperation in agriculture

The Mekong Delta province of Vinh Long and the Netherlands share numerous similarities that facilitate bilateral cooperation in food processing, agricultural food and food service supply.

Chairman of the provincial People’s Committee Nguyen Van Quang made the remark at a workshop on establishing linkages in agricultural production based on a model of Food Valley Group from the Netherlands on June 14.

At the event, Roger Van Hoesel, CEO of the Dutch firm introduced their linkage chain and discussed cooperation opportunities with the province, including human resource training, technical transfer, food processing techniques and farm management.

Despite strengths in agriculture, the province should work to enhance product quality while applying more automatic processing chains, he added.

Quang expressed his hope for more visits and working sessions between the company and the province to share information and experience, thus setting up a Food Valley Group-based linkage chain in local agricultural production.

PPP –optimal solution to infrastructure investment in HCM City

Public-private partnership (PPP) is one of the optimal solutions to investment attraction for infrastructure projects in Ho Chi Minh City, said Chairman of the municipal People’s Committee Nguyen Thanh Phong.

The city has so far launched 153 PPP projects worth 451 trillion VND (19.6 billion USD) , 23 of them valued at 71 trillion VND have been completed while others are in the preparatory phase, he said at a conference on June 14 to review investment attraction for PPP infrastructure projects. 

HCM City has issued a number of policies to improve business climate, notably the establishment of the PPP Steering Committee, he said, adding that it is working to set up the Project Development Fund (PDF) and the Viability Gap Fund (VGF) to provide funding for PPP projects, he said. 

According to Phong, from 2006-2020, the city’s capital demand amounts to 850 trillion VND but the municipal budget only meets 20 percent. 

Total investment for transport, environment and flooding control projects is estimated at over 500 trillion VND, but the city’s budget satisfies a mere 31.8 percent, he further said.

Nguyen Thi Thu Hoa, Deputy Director of the municipal Department of Planning and Investment, said the city recorded 18 projects worth more than 59 trillion VND in the build-operate-transfer, build-transfer, build-transfer-operate, and build-own-operate models during 2004-2015, 15 of them are in transport field. 

After the government issued Decree 15/2015/ND-CP on February 14, 2015 on investment in PPP, the city embarked on five projects with a total investment of around 12 trillion VND. 

A representative from the Ho Chi Minh City Finance and Investment State-owned company (HFIC) suggested the city step up administrative reform, provide transparent planning information, and soon establish PDF and VGF to channel funding into PPP projects.
 
New market rule to improve trading quality

A new rule issued by the Hanoi Stock Exchange, allowing brokerages to become securities market members, is expected to improve the trading quality of Vietnam’s securities market.

The new market maker regulation, which will come into effect in July, is expected to help improve market trading liquidity and help listed companies draw higher capital flows from investors.

In addition, the regulation will help Vietnam’s securities market develop further in scope and quality, and meet international securities trading standards.

Market makers play an important role in connecting demand and supply between buyers and sellers in the securities market to boost trading liquidity of securities products.

By working with market members, investors can easily create trading orders to purchase and/or sell securities products, especially those that have low liquidity or no liquidity at all.

When an investor decides to buy and/or sell a securities product, in which other investors have no interest, market makers must create their own sell/buy orders so that the targeted product becomes tradable.

The purchasing price is the highest price level a market maker is willing to pay for the targeted securities product, and the selling price is the lowest which a market maker is willing to accept.

In some big stock exchanges around the world, such as the US Nasdaq Stock Market and the New York Stock Exchange, the London Stock Exchange and the Frankfurt Stock Exchange, there are always market makers. On the Nasdaq Stock Market, there are 14 market makers for each securities product.

Market makers can be brokerages, banks and investment funds. Securities issuers can assign one market member or more to carry out the trading of its securities products.

In order to become a market maker, a financial firm must meet requirements set the Hanoi Stock Exchange (HNX), such as keeping the ratio of accumulated loss over charter capital at under 50 percent, ensuring total loans do not exceed equity ownership capital by more than three times, and maintaining the ratio of available capital above at least 220 percent during the last 12 months.

Banks and investment funds that want to become market makers for fund certificates of exchange traded funds (ETFs) must be selected by the fund management firms. The approval of market maker membership for those financial firms is carried out by reviewing their profiles, not inspecting their facilities.

In early May, the HNX issued a decision regulating the rights and obligations of a market maker for the derivatives market, which is expected to go into operation this quarter. The northern exchange also granted market membership to six brokerages, but since the product and market are quite new to investors and trading firms, none of those six companies have registered to become market makers for the derivatives market.

Solar energy provider ET Solar wishes to invest in Can Tho

The multinational group ET Solar held a working session with authorities of the Mekong Delta city of Can Tho on June 14 to seek business opportunities in solar energy supply. 

Speaking at the event, ET Solar chief representative for the Southeast Asia Liming Wang, said ET Solar wants to build a system of solar power plants which are capable of generating nearly 200MW of electricity in Vietnam, especially localities with great potential such as Binh Thuan and Can Tho. 

ET Solar has been successful in 15 countries and become a prestigious share on the US securities exchange. In Vietnam, ET Solar expects to build a plant, sell products to market and transfer technology to localities. 

Director of the municipal Department of Science and Technology Tran Ngoc Nguyen said Can Tho is calling for investment in biology, automation, new materials and energy. In particular, renewable energies such as solar batteries and power have been included in the city’s planning until 2020 with a vision till 2030 to increase power supply, especially in remote areas. 

Can Tho also reduces land use fees for foreign enterprises, and offers land tax waive for projects in the list of priority investment. Investors could enjoy corporate tax exemption in the first four years of operation, 5 percent tax in the next 9 years and 20 percent tax in the 16th year and later. 

Foreign firms operating in high technology are entitled to import and value-added tax exemption, access to preferential loans, equipment and human resources from research and development centres in hi-tech areas. 

The same day, the ET Solar working delegation took a fact-finding trip to Hung Phu industrial zone and expressed belief in bilateral partnership in the future.

Dak Nong authorities pledge optimal conditions for enterprises

The People’s Committee of the Central Highlands province of Dak Nong organised the second dialogue with enterprises on June 14 to collect feedback and address their difficulties in a bid to help them improve the efficiency of production and business activities.

Participating enterprises highlighted a range of difficulties and challenges hindering their operations, mainly related to land, natural resources, policies, credit, finance, taxes and agriculture.

They pointed to difficulties in getting access to loans of commercial banks as well as state mechanisms and policies, complicated tax payment formalities, high land rentals, troublesome administrative procedures and low transparency of the local business environment.

At the dialogue, Vice Chairman of the provincial People’s Committee Tran Xuan Hai pledged to support local enterprises overcome these difficulties and obstacles.

The Centre for Public Administrative Services has been put into operation for nearly one year, marking one of the province’s efforts to speed up administrative reform to better serve local enterprises and residents, Hai said.

Groups of measures will be taken in the time ahead to create favourable conditions for enterprises to expand and improve the efficiency of production and business, thus generating more jobs for local labourers and bolstering the province’s socio-economic development, he added.

Dak Nong is now home to nearly 3,500 enterprises with a combined registered capital of nearly 30 trillion VND (1.32 billion USD). So far this year, 177 new firms have been established.-

Ways to ensure sustainable economic growth in mid term sought

Removing business barriers, clarifying responsibility of management units and dealing with bad debts are among solutions raised at a workshop in Hanoi on June 15, aiming to ensure the rapid and sustainable economic growth in the mid term. 

Nguyen Anh Duong from the Central Institute for Economic Management (CIEM), said Vietnam’s economic growth has remained sluggish over the past years, suggesting a close and flexible combination between fiscal year and capital and monetary markets. 

It is necessary to take into account the greatest benefits while engaging in the Trans-Pacific Partnership (TPP) agreement and materialsing free trade agreements in general. 

Other delegates at the even proposed the Government well implement its commitment to building a facilitating Government that supports businesses.  

They also called for efforts to curb with bad deeds like corruption, wastefulness and group interests to ensure a fair and transparent business environment. 

The Government should consistently pursue its viewpoints on sustainable development and manage the economy on the basis of market rules, they said. 

Dr. Dang Thi Thu Hoai, from the CIEM, said reforming the growth model is an urgent task to serve the target of rapid and sustainable growth in the context of integration. 

She underscored the need to identify both opportunities and challenges facing the economy. 

Hoai noted that it is necessary to improve added values of products, especially those belonging to promising sectors, and quality of human resources, looking towards higher productivity. 

“The Government should take measures to ensure equal access to resources of businesses, avoiding wastefulness, conflicts or overlapping of interests,” she said.