Speculative stock profits soar as blue chips lift markets

Booming transactions of blue chips boosted the benchmark indices to advance last week, while speculative stocks were among those generating the largest profits.

The VN-Index succeeded in regaining its previous high of 596 points, rising as much as 2.95 per cent to finish at 596.83 points, as the HNX-Index also added 2,76 per cent to finish at 84.43 points.

Transactions soared over the previous week, with matching volumes increasing 17 per cent and 32.1 per cent to reach 758.6 million shares and 496.8 million shares, respectively, on HCM City and Ha Noi Exchanges.

On HCM City Exchange, the upward trend was stable during the trading week. Gains mainly came from blue chips, such as Vinamilk (VNM), Masan Group (MSN), Vietcombank (VCB), PetroVietnam Gas Corporation (GAS), Bao Viet Group (BVH), PetroVietnam Drilling Corporation (PVD), property giant Vingroup (VIC) and Sai Gon Securities Company (SSI).

On the southern bourse, the trading value averaged VND2.58 trillion (US$122.8 million) on the exchange with an average volume of 156.6 million shares.

When the market received support from blue chips, speculative stocks were also active, especially those in real estate, construction, securities and mining sectors, which attracted capital inflow last week.

However, profit-taking pressures were seen to intensify on the last two trading days of the week when the VN-Index approached the 596-point level. Fluctuations occurred, but gains from blue chips and significant capital inflow helped clear losses.

On the Ha Noi Exchange, the average trading volume and value reached 101.1 million shares and VND989.2 billion ($47.1 million).

The HNX-Index advanced on most trading days during the week, except Wednesday when it closed down due to high selling pressure.

Also, the capital city bourse's trading value exceeded VND1.1 trillion on Tuesday and Friday. PetroVietnam Construction Joint Stock Corporation posted strong gains last week, rising as much as 28.26 per cent, although there was no information released regarding its business. Experts said that the capital inflow into the stock last week might have been speculative money, with the expectation that the company would clear losses this year thanks to the opening of the Thai Binh Thermoelectric plant.

Additionally, the Prime Minister's approval to the derivatives development projects, as well as the establishment of a board in charge of resolving bad debts, improved investors' confidence last week.

However, foreign investors continued their net selling, placed at VND302 billion ($14.38 million) on both bourses.

On the HCM City Exchange, net selling reached VND163 billion ($7.7 million) on stocks, such as Hoang Anh Gia Lai (HAG), PetroVietnam Fertilisers and Chemicals Corporation (DPM), Kinh Bac Urban Development Company (KBC) and Ocean Group (OCG). However, Masan Group (MSN) and PetroVietnam Gas Corporation (GAS) saw net buying from foreign investors.

Meanwhile, stock analysts were divided on forecasts about what would happen this week.

Bao Viet Securities said that the upward trend would be maintained this week, provided that significant capital inflows were maintained.

Further, BIDV Securities said the net selling of VNM exchanged traded fund would put relatively high pressure on the market and the benchmark indices would fluctuate around 590-600 points.

Of note, losses are expected to occur between trading sessions with gains, according to Military Bank Securities.

This week, many companies will hold their stakeholders meetings, which will attract the attention of investors. 

Market watchdogs ask for city help to fight smuggling

Market-watch officers of HCM City have urged local authorities to allocate more money and staff to fight the onslaught of counterfeit products smuggled into the city.

During a recent meeting with city leaders, representatives from the HCM City Market Management Bureau reported that the city last year discovered 3,495 cases of smuggled fake goods, an increase of 210 per cent against 2012.

Phan Hoan Kiem, head of the bureau, said that most counterfeit and illegally imported products were wine, chemicals, canvas, cigarettes, agricultural materials, fashion accessories and cosmetics.

The fake goods are made both domestically and abroad and then smuggled into the country.

Infringement of intellectual protection rights is occurring more frequently, affecting licensed companies and consumers, Kiem added.

Dinh Minh Tan, a market control officer who is responsible for Binh Thanh District, said last year in the district 141 cases were discovered. The district collected VND5.1 billion from administrative penalties and seized goods valued at VND13 billion ($611,000).

Even though the city has increased the number of inspections as well as fines, the lack of resources and personnel has limited successful implementation.

Officials suggested that the government allocate more funds and personnel, as well as consider giving inspectors commissions for discovering violators.

However, Nguyen Thi Hong, deputy chairwoman of HCM City's People's Committee, said that an increase in violations had shown that capacity had improved.

The market bureau asked the city to impose harsh punishment on makers and traders of fake and low quality products.

Shinsegae eyes hypermarket project in city

Shinsegae is expected to be the second Korean retailer joining Vietnam’s market after Lotte as a leader of the group has arrived in HCMC to seek a suitable location for building a hypermarket.

Lee Sang-eun, vice president taking charge of E-mart segment of the group, arrived in the city early this week to speed up investment licensing.

“Shinsegae has entered Vietnam later than other investors in the sector but we will not rush. As this is long-term business, everything will be carried out carefully,” Lee said via interpreter at the meeting with HCMC’s Vice Chairman Le Manh Ha on Tuesday.

However, the project has just been in the preparatory step. Lee’s visit aims to seek a suitable location for hypermarket construction and speed up investment license procedures.

“We expect to win the license before the end of this year,” Lee said.

A Vietnamese manager of Shinsegae told the Daily that the project has a total investment of around US$65 million and Go Vap District is estimated as the venue for the project.

Shinsegae was separated from Samsung in the 90s. It now the leading retailer in Korea with the hypermarket Shinsegae Centum in Busan City, boasted as the biggest in its kind in the world.

It is reported that Shinsegae has defeated two retail giants Wal-mart and Carrefour on its home ground. The U.S.’s Wal-mart had withdrawn from the nation after incurring loss of nearly US$10 million in 2005 while France’s Carrefour had to sell 32 stores to E-land, a Korean retailer, at US$1.85 billion for the same reason.

Machine suppliers explore opportunities in Vietnam

The growing plastic, rubber, food processing and beverage industries are opening up opportunities for foreign suppliers and manufacturers of equipment and machinery that are joining an industrial exhibition in HCMC.

There are 470 enterprises from 28 countries and territories displaying their machines and equipment at the International Processing, Filling and Packaging Exhibition and Conference (Propak 2014) and the International Plastics and Rubber Technologies and Materials Exhibition (Plastics & Rubber Vietnam 2014) opened on Tuesday in HCMC.

Justin Pau, general manager of Bangkok Exhibition Services as one of the organizers, said Vietnam’s export is forecast to achieve growth of 20% this year, up from 15.4% recorded last year, which is a good prospect for machine suppliers to boost sales in the market.

Vera Fritsche, Markets and Exhibitions Manager, Packaging Machinery, Food Processing Machinery at the German Engineering Federation (VDMA), said Vietnam’s food, beverage, plastics and rubber industries were developing quickly. Domestic demand for packaged and processed food will continue to rise due to the nation’s young population, changing consumer habits, rising incomes and increasing demand for processed food of high quality, she added.

However, according to Fritsche, production at Vietnamese firms still depends much on imported machines, which is the reason why a delegation of 25 German firms is present at the two exhibitions. Vietnam’s imports of machines and equipment from Germany have grown in recent years, with machines used in food packaging and plastics and rubber industries reaching around 45.5 million euros in January-November last year.

Bruna Santarelli from the Italian Trade Commission in Vietnam said that on this occasion, 12 machine and equipment manufacturers from Italy are attending the exhibitions.

According to Santarelli, Vietnam is striving to become an industrialized economy in 2020, and thus domestic manufacturers have higher demand for advanced technologies and production lines.

A representative of the Taiwanese business delegation at the exhibitions said that Vietnam’s industrial production is growing and that there are more Taiwan companies investing in Vietnam. Therefore, machine manufacturers in Taiwan are seeking business opportunities here in the nation, he added.

Meanwhile, the Japanese food packaging and machinery company Ishida considers Vietnam a big market.

Hitoshi Fujieda, general director of Ishida Vietnam Co., Ltd, said the firm has supplied over 300 packaging machines and many other production lines for Vietnamese enterprises such as Kinh Do, Bibica and Vinamit as well as foreign enterprises operating in Vietnam.

Vietnam’s food processing has grown rapidly over the years with an average growth rate of over 10% a year, said Tran Viet Dung, deputy director of VCCI Exhibitions as an organizer of the events.

The two exhibitions under the same roof are taking place at the Saigon Exhibition and Convention Center in District 7 until Thursday.

Non-tariff barriers high in trade with EU

Vietnamese enterprises may find it hard in speeding up exports to the European Union (EU) when the Vietnam-EU Free Trade Agreement (FTA) ic concluded and begins effective, as non-tariff barriers are seen challenging.

During the seminar on impacts of the FTA organized by the WTO Center in HCMC and the EU-Vietnam Mutrap (Multilateral Trade Assistance Project) on Wednesday, experts warned that it would be tough for enterprises to abide by non-tariff requirements in the EU market.

Nguyen Minh Thao from the Central Institute for Economic Management took furniture for example, saying that over 90% of Vietnamese wood products will enjoy the tariff rate of 0% given effects of the FTA. However, if the local woodworking industry fails to overcome non-tariff requirements, the nation will be not able to grasp opportunities in the EU market.

At present, Vietnam imports up to 80% of materials including timber for the woodworking industry. Requirements of the Forest Stewardship Council (FSC), the Voluntary Partnership Agreement (VPA) on forestry and timber products, and the Forest Law Enforcement, Government and Trade (FLEGT) are among most stringent rules and it will be costly for enterprises to follow the standards, she said.

In addition, local enterprises may fail to meet requirements of EU consumers such as material origin rules and the Regulation on Registration, Evaluation, Authorization and Restriction of Chemicals (REACH).

Meanwhile, the fine arts and handicraft industry mainly uses domestic materials such as rattan, bamboo and pottery. Recently, Vietnam has begun to import bamboo from China and rattan from Laos and Cambodia.

To approach the EU market, local producers have to meet standards such as REACH and other rules on packaging and hazard substances in products. There are still a lot of requirements such as BSCI (Business Social Compliance Initiative) and Corporate Social Responsibility (CSR) to protect employees and the environment.

Mutrap experts also said that the garment and textile sector will see positive prospects in the EU market. However, if enterprises cannot overcome challenges of CSR and worker protection rules, apparel export revenues in the market will not improve.

For farm produce and seafood, Do Lien Huong, a Mutrap expert, said that non-tariff measures mean so much in the agriculture sector. Such measures include standards in hygiene, quarantine, packaging and customs checking.

Standards applied by the EU are considered as the strictest and prove most expensive in the world for enterprises.

ACV prepares for airport expansion

Airports Corporation of Vietnam (ACV) is planning to expand Tan Son Nhat International Airport in HCMC in anticipation of a rise in passengers in the coming years while work on Long Thanh International Airport in Dong Nai Province has yet to start.

ACV is formulating a project to expand Tan Son Nhat, ACV general director Le Manh Hung told the Daily after it was reported in the local media that the Government had given the nod to the plan.

The Ministry of Transport and ACV would be tasked with expanding Tan Son Nhat. Nguyen Van Luu, chief of the ministry’s office, said the ministry has yet to receive any notice from the Government on approval of the project.

Given ACV’s calculations, Tan Son Nhat should be expanded to build more aircraft parking spots so that the airport would be able to accommodate 26 million passengers a year.

The domestic terminal would be expanded by 2,000 square meters plus an additional technical area of 500 square meters. Once completed, it would have a total area of over 39,000 square meters to serve 4,500 passengers at a time, raising the total capacity of the domestic terminal to 12 million guests a year.

The current international terminal has a capacity of 10 million passengers a year and is expected to run at full capacity this year. Therefore, ACV plans to widen the terminal to serve 13 million passengers a year.

In addition, the airport must have 60 to 65 aircraft parking spots, up from the current 40. With the remaining area of the airport and a part of military-held land included, 21 parking spots will be built.

However, Le Trong Sanh, former head of the Tan Son Nhat airport flight management department, had earlier said that if local authorities reclaim 157 hectares designated for a golf course in its buffer zone, the land will be able to provide at least 30 new parking lots.

The airport’s annual capacity reached 20 million passengers late last year, one year sooner than earlier estimated. Expansion of both local and international terminals would help serve six million more passengers.

At present, 44 carriers have flights to and from the airport.

Vietnam should have trustees in bankruptcy

Most speakers at a meeting in HCMC on Monday to discuss the draft amendments to the Law on Bankruptcy agreed on the need to have trustees in bankruptcy – a career title not yet available in Vietnam – given that the number of enterprises going bust is in the rise.

It is popular in foreign countries to have a trustee in bankruptcy instead of an organization to supervise and manage the bankrupt enterprise’s assets until liquidation. The job should be assumed by an individual instead of an organization to ensure flexibility and efficiency, according to the meeting convened by the HCMC delegation of National Assembly deputies.

According to Article 10 of the draft, candidates for the position of a trustee in bankruptcy include lawyers, auditors, bachelor of laws and bachelor of economics with at least three years of experience in accounting, auditing, and corporate governance.

Justin Yap, a senior expert on bankruptcy law of the International Finance Corporation IFC, said at the meeting that the trustee in bankruptcy plays the central role in every modern law on bankruptcy. This person will assist in either the process of bankruptcy/liquidation or the process of business recovery.

He added that the bankruptcy trustee must have good reputation and trust from society and the court, which require this person to have sufficient capacity to perform the tasks assigned.

At the conference, the participants agreed that a good salary ladder should be designed to attract capable human resources.

Under the Bankruptcy Law 2004, the asset liquidation team is responsible for the whole bankruptcy procedures. However, the actual practice is still ineffective, prompting the need to have trustees in bankruptcy.

Statistics from the People’s Supreme Court show that since 2004 to date, only 83 enterprises have been declared bankrupt by courts out of 336 filings from enterprises for performing bankruptcy procedures or for court receivership.

Housing stimulus package criticised for slow disbursal

A NA deputy has put up questions about the slow disbursal of the VND30 trillion (USD1.4 billion) real estate stimulus package which was launched in June last year.

The package offers loans to property developers at low interest rates of around 6% per year. However, at the assessment meetings on the adjusted housing laws held on March 6, Ngo Van Minh, a deputy of the NA's Juridical Committee, said that only 9% of the package has been disbursed so far.

"Just where is this package now? If it is not being used then please give it back so we can use it for other purposes," Minh asked members of the Ministry of Construction. He went on to say that the package was meant to support low-income earners, yet many individuals and enterprises cannot get loans because interest rates are high and the loan terms too short. He proposed giving a longer loan terms and lifting the cap on the maximum loan amount.

In response, the Minister of Construction Trinh Dinh Dung, agreed that the terms should be increased from 10 to 15-20 years so customers will be able to make their payments. However, if localities and enterprises do not build low-income housing, he added, the fund would be useless.

"This package was never meant to be divided up as quickly as possible. These loans must also have requirements, and the fund can last for many years, perhaps even until the per capita income of Vietnam reaches USD50,000," he said.

As of February 17, 2014, the State Bank of Vietnam agreed to give over VND1.4 trillion loan to 17 enterprises, and disbursed over VND537 billion to 11 firms. On the other hand, VND550 billion was loaned to more than 2,000 individuals at an annual interest rate of 5%, which is 1% lower than last year.

Japan firm licensed to operate $2 mln Vietnam bus route

A Japanese firm will invest in two eco-friendly bus lines that cost an estimated US$2 million dollars via a joint venture with a local company under a license granted last month by authorities in a southern Vietnamese province.

The People’s Committee of Binh Duong Province issued on February 20 an investment license to Becamex Tokyu Bus Co Ltd, a joint venture between Japan’s Tokyu Group and Vietnam’s Becamex Binh Duong Corporation, which allows it to operate two bus services there.

Becamex Tokyu Bus will spend over VND40 billion ($2 million) on the bus lines which are expected to begin operations in May this year.

The new buses will run on compressed natural gas, also known as CNG, which is more environment-friendly and cost-effective than normal fuel.

They will ply along a 20km route between the current provincial capital Thu Dau Mot City and Binh Duong New City, a 1,000-hectare modern complex set to become Binh Duong’s future administrative center.

Thu Dau Mot City is about 30km from Ho Chi Minh City, Vietnam’s southern economic hub.

Tokyu Group is now investing in Tokyu Binh Duong Garden City in the province, a 110-hectare urban area with a total registered capital of $1.2 billion.

Work on the project officially started in March 2012.

Motorbike market almost reaches saturation in Vietnam: insiders

Motorbike sales will continue to slump as the Vietnamese market has almost reached a saturation point, industry insiders have said.

Vietnam’s motorbike market is in trouble and will continue to slow down in the near future because supply has already surpassed demand, according to Masayuki Igarashi, general director of Honda Vietnam.

Only 335,000 vehicles were sold earlier this year, a 3 percent slide compared to the same period last year, Igarashi said.

Igarashi predicted that motorbike makers will face a myriad of challenges in 2014 as the economy is still in a fragile state.

Moreover, the market is becoming more competitive as motorbike manufacturers have started to slash prices in order to lure customers.

Motorbike retail prices in Vietnam have decreased by VND500,000-2 million per unit and it seems they will only continue to decrease.

Even worse, many motorbike shops have already joined makers in cutting staff to avoid losses.

Kiyokazu Sasabe, deputy general director of Honda Vietnam, said that two Honda factories in the northern province of Vinh Phuc had to lay off 500 employees in 2013 due to a plunge in motorbike sales.

“In the past, we sold around 20 motorbikes per day right after the Lunar New Year. But that number plummeted to 5 – 6 motorbikes per day following Tet this year,” a Honda salesman in Hanoi said.

Motorbike producers have sold 35-37 million products so far in a market of 90 million people, a Japanese expert was quoted as saying.

The Vietnamese market has almost reached saturation, where supply exceeds demand, the expert added.

Motorbike sales totaled 2.8 million units last year, down 10 percent from 2012 and 15 percent from a year earlier, statistics show.

The slowdown in motorbike sales in both 2012 and 2013 has shown a trend of exhaustive purchasing power, according to the Vietnam Association of Motorcycle Manufacturers.

Established on August 26, 2013 in the hope of boosting the local market, the association is comprised of Honda Vietnam, Suzuki Vietnam, Yamaha Vietnam, Piaggio Vietnam, and SYM.

B. Braun expands investment in Vietnam

Germany’s B. Braun Vietnam Co. Ltd announced Wednesday that it would expand its medical facility in Hanoi’s Thanh Oai district.

The company will invest some $50 million in the second phase, which is slated for completion within 18 months.

Speaking at the ceremony, Meinrad Lugan, a member of B. Braun Melsungen AG’s management board said: “Our vision of the future in Vietnam is to bring significant investment over the next nine years, with the opportunity to create 1,300 jobs. B. Braun is proud to strengthen the image of made in Vietnam products with a consistent high level of quality achieved through continual training and skills development of its employees.”

B. Braun completed the first phase of the facility in July 2011 with the total investment of $54 million. B. Braun founded its first representative office in Ho Chi Minh City in 1992. The company inaugurated its first factory in Hanoi in 1997 and in 2008 built the Thanh Oai plant.

Last year B. Braun Vietnam reported its sales turnover of $72 million, including $34.6 million, 48 per cent, of domestic sales and $37.4 million in exports.

Vietnam home to majority of attacked wireless routers: report

A widespread cyber attack has been compromising several hundreds of thousands of wireless routers in Europe and Asia, with a larger majority of affected devices found to reside in Vietnam, according to a report from Internet security research firm Team Cymru.

The report, titled Growing Exploitation of Small Office Routers Creating Serious Risks, said consumer-grade small office / home office (SOHO) routers are victims of the large-scale pharming campaign.

Pharming is a cyber attack intended to redirect a website's traffic to another, bogus site.

The security firm said its report, released on Thursday, detailed the latest campaign in a growing trend it has observed of cyber criminals targeting SOHO routers.

Team Cymru’s Enterprise Intelligence Services have so far identified over 300,000 devices, predominantly in Europe and Asia, which they believe have been compromised since mid-December 2013.

“Our analysis indicated that a large majority of affected routers resided in Vietnam,” the report said, adding other top countries affected included India, Italy and Thailand.

“Attackers are altering the DNS configuration on these devices in order to redirect victims’ DNS requests and subsequently replace the intended answers with IP addresses and domains controlled by the attackers.”

Affected devices had their DNS settings changed to use the IP addresses 5.45.75.11 and 5.45.75.36.

By doing so, the hackers will be able to effectively conduct a Man-in-the-Middle attack.

Man-in-the-Middle attack is a form of active eavesdropping in which the attacker makes independent connections with the victims and relays messages between them, making them believe that they are talking directly to each other over a private connection, when in fact the entire conversation is controlled by the attacker.

“Cyber criminals are turning to new methods to achieve their desired goals, without gaining access to victims’ machines directly,” Team Cymru said.

The affected devices are vulnerable to multiple exploit techniques, while many cyber crime participants have become used to purchasing bots, exploit servers, and other infrastructure as managed services from other criminals.

The reason that makes SOHO-type wireless routers “a very attractive target for cyber criminals,” according to the company, is that most consumers are “unfamiliar with configuring these devices, as well as frequently insecure default settings, backdoors in firmware, and commodity-level engineering standards make.”

The report also indicates that the compromise is not limited to a single manufacturer with a range of router models from several manufacturers apparently compromised.

“As with the DNSChanger malware, unwitting victims are vulnerable to a loss of service if the malicious servers are taken down, as both primary and secondary DNS IP addresses are overwritten, complicating mitigation,” it warned.

Mekong Delta: 2.55 bln USD in shrimp export in 2014

Mekong delta provinces will strive for 2.55 billion USD in shrimp export this year, around 50 million USD more than the turnover obtained in 2013.

The future figure will include the amount of 1.1 billion USD set forth by Ca Mau province alone.

In the first two months of this year, the region raked in 433 million USD from export of the product.

To that end, the provinces have put 596,000 hectares of water area for farming shrimp, of which 478,000 hectares are in coastal localities as Ca Mau, Bac Lieu, Kien Giang, Soc Trang and Tra Vinh.

They have strengthened management over the quality of fries, irrigation systems and the use of chemicals or substances in farming in order to yield healthy shrimp.

Especially, Ca Mau, Bac Lieu, Ben Tre and Kien Giang have also provided loans worth more than 500 billion VND (23.5 million USD) for local farmers to improve aquaculture environment and buy fries and feed.

The Mekong Delta harvested 380,000 tonnes of shrimp in 2013, accounting for 79.8 percent of domestic shrimp production. It earned 2.5 billion USD in export of the product.

Vietnam becomes third largest natural rubber producer globally

Vietnam has surpassed Malaysia and India to become the third largest natural rubber producer in the world, according to the Association of Natural Rubber Producing Countries (ANRPC).

ANRPC reported that in 2013, Vietnam’s rubber output was estimated to hit 1.043 million tonnes, up 20.8 percent from a year earlier.

The country’s rubber production has for the first time in its history exceeded 1 million tonnes, jumping from the fifth position to the third in the global ranking.

China also climbed to the fourth position from the sixth place with 856,000 tonnes, according to the association.

Malaysia , however, fell to the sixth position from its previous third place after experiencing a drop of 11.1 percent in its production to 820,000 tonnes, said ANRPC.

India also suffered similar decrease to 849,000 tonnes, staying at the fifth position, added the association.

ANRPC data also showed that among the world’s nine largest natural rubber producers, India, Malaysia and Sri Lanka saw drops in production in 2013. Meanwhile, Vietnam and China enjoyed a sharp surge.

Chinese firms rev up operation in Nam Dinh

The People’s Committee of the Red River Delta province of Nam Dinh has granted an investment licence to Jiangsu Julun Textiles Group Co., Ltd of China to build a factory worth 68 million USD in the locality.

Covering an area of 80,000 sq. m in the Bao Minh industrial park in Vu Ban district, the factory specialises in producing yarn with an annual capacity of 9,816 tonnes, weaving (21.6 million metres) and dyeing (24 million metres).

Construction of the factory, whose land lease contract is for 46 years, is scheduled to be completed in June 2016.

According to Nguyen Viet Thang, from the managing board of industrial zones in Nam Dinh, another investor from Hong Kong (China) is planning to build a 10,000 ha garment and textile industrial park in Nghia Hung district.

The province will submit the project to the Government for approval, he said.

Nam Dinh province has three industrial parks – Hoa Xa, Bao Minh and My Trung - which house a total of 127 businesses with nearly 25,000 workers.-

Vietnam Access Day to open in HCM City

The international Vietnam Access Day 2014 investment conference next week will offer opportunities for leading Vietnamese companies and portfolio investors around the world to exchange ideas and foster links, the Vietnam Investment Review reported on March 11.

The two-day event, co-organised by Viet Capital Bank and Viet Capital Securities Co. (VCSC), is due to take place on March 18 in Ho Chi Minh City.

It will help Vietnamese companies capitalise on the opportunity to raise awareness with global investors, which could provide them with a leading edge to attract future capital, said VCSC General Director To Hai.

For investors, “we hope that through Vietnam Access Day, they will be provided with a complete panorama of the Vietnamese economy, as well as detailed information about the areas in which they are interested,” Hai added.

Investors will also go on site visits to Dat Xanh Group’s housing projects, Vinamilk’s factories and the Ho Chi Minh City Infrastructure Investment Company’s Thu Duc water plant.

Business leaders and think-tanks will converge to give presentations and host panel-led debates.

Nguyen Xuan Thanh, Director of the Fulbright Economics Teaching Programme, is slated to give an analysis of Vietnam’s economy, whereas Baker & McKenzie principal Frederick Burke will explain what the Trans-Pacific Partnership (TPP) means to Vietnam and Vo Thanh Hung from the Finance Ministry will summarise the government’s budget priorities for this year.

Henry B. Nguyen, McDonald’s Vietnam Executive Director, will talk about McDonald’s first foray into Vietnam and eagerness to open hundreds of franchising restaurants in the years to come. Regarding consumer trends, Ralf Matthaes, Managing Director of Taylor Nelson Sofres Market Research, will discuss Vietnamese consumer habits.

Hot topics include the real estate market presented by CBRE Vietnam Managing Director Marc Townsend and efforts to enhance market liquidity by Deputy General Director of the Ho Chi Minh Stock Exchange Le Hai Tra.

Four panels will discuss issues of micro-economics, consumer trends, risks to the banking system, and derivatives and new products for the stock market.

The event would gather together 200 investors and 38 leading firms, including a majority of Vietnam’s largest businesses. Hai said: “We hope to help make Vietnam become a favorite destination among international investors. As the leading provider of financial services in the market, we believe that our outstanding capability and experience will enable us to act as a bridge to new investment opportunities.”

Vietnam Access Day was held for the first time in 2012 with over 300 attendees, including 210 local and global investors, 60 representatives from Vietnam’s leading companies and 34 guest speakers, making it the largest event of its kind about Vietnam.-

A healthier banking sector with fewer non-performing loans and increased net exports will support strong GDP growth of 5.4 percent in Vietnam this year which will accelerate to 5.7 percent in 2015 and 2016.

The paper said the information was cited from a latest report from the Institute of Chartered Accountants in England and Wales (ICAEW), a world leading professional membership organisation headquartered in London.

According to the report, robust growth will come on the back of the country becoming more open to international investors, which will help attract capital into the economy.

Increases in government spending, partially thanks to the equitisation of state-owned assets, is also expected to support growth rates over the next few years.

Demands on energy will continue to grow with the economic boom and in this regard, Vietnam may soon join its ASEAN neighbours in becoming a net energy importer.

In many ASEAN countries, demand for energy is growing at a faster pace than domestic production and continued economic expansion may well mean these economies becoming increasingly dependent upon international energy markets to meet their needs.

This will mean countries are vulnerable to unexpected price movements which could have an effect on inflation. However, falling global oil prices between 2014 and 2016 – and the entrance of Iran into the global energy market -should help mitigate inflation in the region, the report read.

“Economic growth in Vietnam is set to accelerate as relatively cheap labour, a disciplined labour force and improving conditions for investors continues to attract new capital. As long as this cost advantage remains, Vietnam will benefit from strong growth and investor appeal,” said Douglas McWilliams, ICAEW chief economist and executive chairman of Cebr.

The ICAEW report Economic Insight: South East Asia is produced by Cebr, ICAEW’s partner and economic forecaster. Commissioned by ICAEW, the report provides its 142,000 members with a current snapshot of the region’s economic performance.

The report undertakes a quarterly review of South East Asian economies, with a focus on the following countries as Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.-

Clear business strategies bring small enterprises long term success

Central Institute for Economic Management (CIEM) former Director Le Dang Doanh said that small enterprises could achieve success if leaders adopt clear business strategies and show self confidence, the Vietnam Economic News reported on March 10.

According to the General Statistics Office’s data, in January 2014, Vietnam had 6,900 newly-established enterprises, an increase of 15.7 percent of the number of enterprises.

However, registered capital only reached 43.7 trillion VND, an increase of 11.5 percent compared to December 2013. The number of newly-established enterprises increased while registered capital reduced.

According to the General Statistics Office’s data, in 2013, Vietnam had 76,955 newly-established enterprises, an increase of 10.1 percent compared to 2012.

However, registered capital only reached 398.7 trillion VND, a decline of 14.7 percent compared to 2012.

General Statistics Office General Director Nguyen Bich Lam said that if the average capital size of a newly-established enterprise reached 6.68 billion VND in 2012, its figure declined to 5 billion VND in 2013.

Many ideas showed that production activities and competitiveness capacity of newly-established enterprises were estimated to be worsened. However, according to Le Dang Doanh, a small enterprise with small capital could compete with large enterprises. If leaders focus on researching the market, techniques and technology and staying away from pursuing immediate profits, they can achieve success. In particular, in addition to indulgence, entrepreneurs need to show self confidence to start up a business.

According to Le Dang Doanh, in 2013, many Vietnamese enterprises bankrupted or halted operation while some enterprises still strongly developed such as Minh Long Ceramics and the Rang Dong Light Source and Vacuum Flask Joint Stock Company.

They are not huge businesses, but with the creativity, they have made outstanding achievements in business and production activities. In February 2014, Minh Long Ceramics received an award by the Minister of Science and Technology.

Le Dang Doanh also advised leaders to show self confidence, strength and intelligence. In particular, leaders should focus on researching the market to create necessary goods serving consumer demands.

In addition to self confidence, strength and intelligence, entrepreneurs need to take care of staff, contributing to ensuring better living conditions for them.

Entrepreneurs need to learn experiences from older generations and make a profit to help enterprises in general and staff in particular overcome difficulties. “If entrepreneurs take care of their staff, they can achieve success,” Le Dang Doanh said.

Another important issue to help small enterprises achieve success is aware of their position and spending. Phu Thai Group Chairman of the Board of Directors Pham Dinh Doan said that young entrepreneurs should stay away from pursuing immediate profits.-

Retail banking market continues to grow in Vietnam

The retail banking market in Vietnam has been extremely competitive among more than 100 credit institutions. Therefore, banks must provide customers with the highest value and service from the heart will help to achieve customers’ goals and aspirations.

Head of Retail Banking at Vietnam International Bank (VIB) Rahn Wood spoke with The Saigon Times Daily about retail banking market trend in the country.

Development of the local retail banks in Vietnam is an ongoing trend. As a developing country, Vietnam has low average income, moderate adoption of banking services, whilst its people’s financial needs and demands for payment services have increased extremely fast. Therefore, it is sure that the retail banks of Vietnam will develop strongly over the next decade.

The retail banking market in Vietnam has been extremely competitive among more than 100 credit institutions, especially 48 commercial banks and 53 branches of foreign banks, 28 non-bank credit institutions, two micro-finance institutions and a system of people’s credit funds including one cooperative bank and 1,414 grassroots funds.

Consumer loans (home, auto consumers) and household business loans (personal business) will continue to be boosted. Banks will also focus on promoting the service of payments via card by linking with merchant systems such as game companies, online purchases, electricity/telecom bill payment and supermarkets.

Of course in recent times there have been some economic challenges and we are hopeful that there will be further progress to improve the health of some of the banks that have faced the most difficulties and that consumer confidence in the banking system will return to its usual levels.

In 2015, the retail market is also considered an attractive market for foreign banks who may seek opportunities to participate effectively in Vietnam. In short, the retail banking in Vietnam is not only a challenge, but also an opportunity for those who are willing to invest.-

Ocean Dunes golf course to become urban area

The Binh Thuan People’s Committee has just approved in principle to transform the existing Ocean Dunes Golf Club into an urban development area. Located in Phan Thiet province and operational since 1997, Ocean Dunes is operating at a heavy loss and can no longer bear the expense.

According to Le Tien Phuong, chairman of the Binh Thuan People’s Committee, local authorities have got the thumbs-up to make the move.

The committee will take the necessary steps to submit a final plan to the prime minister for approval.

Nguyen Van Dong, chairman of the Rang Dong Group – the investor in the project – said that when the proposal is finally approved, the group will invest into a multi-function urban area named Blue Sea Street.

What an estimated investment capital of around VND3 trillion ($142.8 million), a third of the investment will be put into infrastructure such as roads, power and water, drainage, parks, and others.

Dong said the changing function of the project will surely increase the efficiency of the land and an estimated VND1 trillion ($47.6 million) in land taxes will go toward the provincial budget.

Dong also said that apart from commercial housing, the investor would develop Blue Sea Street into a modern, environmentally friendly area.

“Blue Sea Street will develop alongside Phan Thiet city and will be a landmark with 30-40 high-rise buildings, villas and houses for living and tourism.

According to a report from Binh Thuan Taxation Department, over the last 10 years total losses sustained by the golf course project have reached VND115 billion ($5.4 million).

Local authorities evaluated the land and found the efficiency of Ocean Dunes was extremely low and making little contribution to the local budget.

At the same time, Phan Thiet city has seen rapid development in terms of both scale and population. The city’s land fund reserved for public purposes is running low on supply, particularly as it was recently upgraded to a second grade city.

The renovation of Ocean Dunes from a golf course to an urban area is a strong move by the city which will resupply the land fund and help support the city’s goal to modernise and attract its core business – tourism.

Korean programme helps agriculture enter value chain

Through a knowledge sharing programme, South Korea is actively supporting Vietnam’s agricultural industry in forming a value chain – an issue paid close attention to by the Vietnamese government.

In a senior policy dialogue on a programme started last year (KSP 2013) at the Ministry of Planning and Investment (MPI) last week, experts from South Korea selected three agricultural products – rubber, coffee and shrimp – to support in joining the global value chain.

According to professor Yong-Taek Kim from Chonman University, KSP 2013 selected these three products as their market shares and export values have risen over the past ten years.

Another reason was that coffee is the biggest forex earner and rubber comes in third of all of Vietnam’s agricultural exports. Shrimp was chosen as it is the country’s most important aquatic export.

Under the KSP 2013, agriculture is targeted due to its central role in the economy. Up to 70 per cent of the Vietnamese population lives in rural areas and 50 per cent of the workforce is in the agricultural industry. At the same time, the country’s agriculture has developed to the point where it is internationally competitive.

Clients may benefit as FPT, Viettel offer pay TV

The local market for pay television services is expected to see fiercer competition and lower fees as major telecom providers FPT Telecom and Viettel join for a piece of the action from April 1 on.

Viettel, a military-run telecom company, has piloted its cable TV services in Hanoi, Ho Chi Minh City, and some other provinces since March 2013.

Though Viettel has yet to announce its official fee rates, sources said that the company will likely charge as little as VND30,000 (US$1.5) a month for its lowest package.

Current fee rates fixed by other cable TV service providers such as HTVC and SCTV are around VND77,000-110,000 a month.

If Viettel’s official fee rates are that low, the pressure on its major competitors including HTVC, SCTV, K+, VTVCab, and VTC will be huge.

One of Viettel’s competitive edges is its availability of some 200,000 km of cables nationwide.

The company said it will cut the average cable coverage distance from its cable connecting points to local households from 350m down to 200m, and even to 100m by 2015.

FPT Telecom, another major provider in cell phone and internet networks, also enjoys several advantages over its pay TV service competitors in having an adequate nationwide network.

The company is also highly experienced in pay TV services; since 2006 it has offered Internet Protocol Television (IPTV) services, a system through which television services are delivered using the Internet protocol suite over a packet-switched network such as a LAN or the Internet, instead of being transmitted through conventional terrestrial, satellite signal, and cable TV formats.

The addition of the cable TV services serves to realize FPT’s goal of offering its clients multiple options including the Internet, interactive TV, High Definition TV (HDTV), and landline and mobile telephone all on a single connection, its representative said.

“We hope to launch our digital pay TV services in Hanoi, HCMC, Da Nang, Can Tho, and some other provinces by the second quarter of this year while making analog pay TV available to the remaining cities and provinces,” said Nguyen Hoang Linh, FPT Telecom’s vice CEO.

According to expert opinions, the local pay TV market will see drastic positive changes in the coming time following the entrance of Viettel and FPT Telecom.

A race to reduce fees among the local service providers is very likely to be in the air, experts predicted.

Some established providers in pay TV services such as K+ and SCTV have recently offered discounts and attractive service packages to keep their current clientele and lure more from their competitors.

The quality of the services will likely improve as competition will be notably fierce, experts added.

However, the leader of a local telecom company asserted that there will not be much competition in monopolizing sports league games, as this would result in unreasonably high prices for the games.

“If local service providers purchase the games’ copyrights together, they will pay lower prices. Then each provider will have their own development of the games’ content in healthy competition among one another,” he noted.

A plan to develop local radio and television services by 2020, which was approved late last year, expects that 60-70 percent of households nationwide will use pay television services by that time.

The plan also highlighted the need for all radio and television services to switch from analog TV to digital terrestrial television by 2020.

According to national statistics announced in 2011, TV viewers nationwide would have to spend a staggering VND9.1 trillion ($433.6 milion) buying new reception devices for digital services.

There are roughly 18.2 million households with television sets in Vietnam. Among them, nearly 12.6 million currently use antennae.

K+ begins competitive drive

The local payTV market is fast becoming more competitive as service providers mount campaigns to take over market share.

On March 6, K+ announced strategic renovations to improve customer experience and options.

The innovative change included reorganising its three current packages, simplifying its subscription fee system and lower equipment prices, applicable nationwide as of March 8.

Accordingly, the previous three subscription packages including Access+, Premium+, and HD+ have been reorganised into two new packages – Access+ and Premium HD+.

The Access+ package consists of 70 channels, including 9 new premium additions such as HBO, Animal Planet, Discovery and Fashion TV.

The Premium HD+ package has 84 channels though those who use SD encoders will only get 74 channels. Others will get the full package.

Also changed is the subscription fee for the packages which now will remain consistent throughout the duration of the contract.

Access+ will go for VND85,000 ($4)/month and Premium HD+ for VND220,000 ($10)/month regardless of contract duration.

Equipment prices will go down to VND990,000 ($47) for an SD equipment set and VND1,800,000 ($86) for an HD set. Down from the previous levels of VND1.5 million and VND2 million.

The move is expected by industry insiders to fuel competition between service providers, primarily through the competitive pricing.

Prior to K+’s move, general director of military-run telco giant Viettel Nguyen Manh Hung said the group was committed to providing customers with the lowest-cost services to satisfy their demands. He emphasised promoting cable television as one of the group’s foremost priorities.

Viettel was licensed to provide cable TV services in April 2013 and pledged to roll out the service within a year.

The telco said it was targeting customers in rural and remote areas, capitalizing on its vast transmission infrastructure advantages.

According to deputy chairman and general secretary of Vietnam PayTV Association Le Dinh Cuong, payTV is a healthy competitive market and the consumer benefits when service providers demonstrate their commitment to offering low-cost quality services.

In respect to service providers’ concerns over the possibility that new-comer Viettel will apply a low-cost tactic to woo customers the way it did, and succeeded with, in the telecom sector, Cuong said, “The association has urged government agencies to finalise a floor-pricing scheme in this year’s second quarter to ensure healthy market competition.”

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