Japanese brewers’ thirst for highly fancied Sabeco

Japanese brewers Kirin Holdings and Asahi Group Holdings are licking their lips at the thought of investing in Vietnam’s state-owned brewer Sabeco.

Representatives from the two beer makers last week separately met leaders of Ministry of Industry and Trade (MoIT) to look at investment in their local counterpart.

“Kirin said it wanted to become a strategic partner of Sabeco, while Asahi expressed a desire to become a stakeholder of Sabeco,” said Phan Chi Dung, director of MoIT’s Light Industry Department, who attended the meetings with both brewers.

Sabeco, which is under the MoIT management, is one of the largest beer producers in Vietnam. The firm last week reported total revenue of around $1 billion in 2011, up 13 per cent against 2010.

But Dung said it was too early to say whether Kirin and Asahi would invest in the local Sabeco beer-maker, adding that the potential investors would now have to submit specific investment plans to the MoIT for further discussion.

The moves of both Kirin and Asahi – the two largest brewers in Japan – follow recent announcements of their plans to expand into South East Asia, including Vietnam, by acquiring stakes at existing local breweries. Three years ago, Asahi had plans to acquire a 10 per cent stake in Sabeco, but the deal never came to fruition.

Kirin last year listed Vietnam among the top 25 beer-consuming markets in the world. In 2010, the country was ranked as the 15th biggest beer producing nation in the world, with 15.2 per cent growth against 2009.

The MoIT forecasts demand for beer in Vietnam will rise to 5.8 million kilolitres by 2020 from 2.6 million kilolitres in 2010.

Growing beer consumption in Vietnam has attracted the attention of many foreign brewers. Another Japanese beer maker, Sapporo Holdings, late last year started production of its international strategic Sapporo Premium product at its first factory in southern Long An province.

Yoshiyuki Mochida, president of Sapporo International, said the firm may decide to open a second factory in Hanoi in 2014 as consumption in Vietnam is forecast to overtake that in Japan by 2020 if current trends continue.

Singapore’s Asia-Pacific Breweries Ltd announced in May 2011 that it would increase production capacity at its brewery in Ho Chi Minh City from 2.8 million hectolitres to 4.2 million hectolitres to further strengthen its position and sharpen its competitive edge in Vietnam.

Sales slow at markets on City outskirts

With just a few days to go for Tet, the usual hustle and bustle associated with the Lunar New Year is missing at traditional markets and shops on the outskirts of HCM City.

Sales of fresh foods like meat, seafood, fruits, and vegetables have been low-key at Ba Diem market in Hoc Mon District and Cau market in District 12.

Only stalls selling dried items such as bamboo shoot, vermicelli, rice, sugar, and green peas reported higher sales than on normal days.

Dung, who runs a dried foodstuff stall at Ba Diem market, said that while buying went up significantly this week, it was much less than at the same time last year.

"Last year besides the two [regular] shop assistants, I also had to get my two grandchildren to help me, but not this year."

At fruit stalls in Ba Diem, watermelon and tangerine are displayed in large quantities, but people just come to see and not buy.

Nguyen Thanh Tai of Dong Thap Province in the Mekong Delta said he had sent more than 400 watermelons to the market but sold only 20 in the last two days compared to 100 last year.

Most customers came to inquire about prices and left, he said.

At confectionery and soft drink shops on Nguyen Van Qua Street in District 12, sales of beer, soft drink, and sweets have been much lower than in previous years.

Minh Tri, owner of a soft drink shop, said in past years some customers bought more than 10 cases of beer to gift others, but this year they bought only half, replacing the other five cases with soft drinks to save money.

Le Van Dich of District 12, who makes and distributes tofu to wholesale markets, said in the past he would usually buy more than 10 cases of beer as gifts for his major clients, but this year he would gift them soft drinks.

But the scene could not be more different in the city's downtown areas, with shopping malls, supermarkets, and garment and footwear shops being packed with shoppers.

Nguyen Thi Dien, director of An Phuoc Company, said sales had jumped 40 per cent this week.

Phan Van Kiet, deputy general director of Viet Tien Garment Company, said sales was up 25-30 per cent compared to the same period last year.

There were an equal number of people buying for their own use as there were for gifting, he added.

Dang Quynh Doan, director of Viet Thy Fashion Company, said turnover was up 15-20 per cent over the same period last year.

The jump was not as high as that of last year, she said, but amid the economic downturn, the increase was a big surprise to the company.

Several supermarkets and shops that signed up for the city's price-stabilisation programme have reported a daily rise in sales, saying shoppers thought that their prices were stable compared to shops in traditional markets.

Shares post gains despite slow trade

Stocks continued to post gains yesterday, with benchmark indices on both of the nation's stock exchanges closing up by over a percentage point.

"I am glad to see that the stock market has closed in the green for several successive sessions," said Minister of Finance Vuong Dinh Hue during an online exchange on Tuesday. "This year may be a promising year for the market."

As the Tet (lunar new year) holiday approaches, inflation data for January is being eagerly anticipated. In a hint of where things were headed, the Department of Industry and Trade in Long An Province announced a monthly inflation rate of 0.93 per cent over December.

Inflation could spike nationwide in January and February due to seasonal demand but would slow down thereafter, predicted Vu Hoang, an analyst for the financial information website vietstock.vn.

Hue also noted the economic risks posed by the possible insolvency of securities companies, may of which are subsidiaries of commercial banks. "These securities firms are in fact entrusted with their parent bank's investment operations, which has distorted the financial system," Hue said.

On the HCM City Stock Exchange yesterday, the VN-Index added nearly 1.1 per cent to close at 362.66 points. The value of trades was essentially unchanged from Tuesday's level, totalling nearly VND347 billion (US$16.5 million), while market volume slowed to just over 18 million shares.

Insurer Bao Viet Holdings (BVH), one of the leading shares by capitalisation, hit its ceiling price, closing up 5 per cent to VND48,500 per share. Many other blue chips rose by 0.6-3 per cent. Overall, advancers outnumbered decliners by 142-65.

With over 77,000 shares changing hands, Sacombank (STB) was the most-active share on the HCM City bourse.

On the Ha Noi Stock Exchange, the HNX-Index also edged up 1.2 per cent to 57.22 points. Nearly 150 out of 393 listed codes saw gains.

Trading was sluggish, however, with market value reaching just VND128 billion ($6 million) – a decrease of 19 per cent from the previous session – on a volume of just over 15 million shares.

VNDirect Securities Co (VND) was again the most-active share nationwide with 1.65 million changing hands.

Foreign investors were net buyers on both bourses by a combined net of VND21.3 billion (about $1 million).

Foreign goods everywhere

Goods of different kinds which were decoratively designed for Tet celebrations have flooded the market in Vietnam.

On sale in Ho Chi Minh City are bundles of red and yellow envelopes in plastic bags, parallel sentences and drawings of 12 animals of different shapes and sizes.

Hoa, a shopkeeper on Hau Giang road says most of the goods were made in China, but prices have gone up by 10-15 percent compared to last year.

Besides, a lot of artificial flowers, hand-made ornamental trees such as apricot, banana, papaya and mandarin were also imported from China, Thailand, Taiwan and Japan.

“The expensive flowers look and smell like real ones,” says Minh, a shop-owner on Pasteur street.

Domestic businesses have launched onto the market some items of goods which were purely designed and unable to compete with those imported from China.

Tran Viet Tien, Director of Gia Long Fine Art JSC, says over the past three years, the company has focused on designing some special items of Vietnamese culture to attract consumers such as images of the dragon in the Ly, Tran and Le dynasties, kettledrums and trays of five fruits (bananas, oranges, kumquats, pomelos, finger citrons). All these have pride of place in Maximart, Lottemart and An Dong market this year.

However, most of other Vietnamese goods are poor in design, says a business manager. Domestic businesses should further improve the design and quality of their products to gain a competitive edge over the imported goods, he suggests.

Hanoi protects consumer rights

The Hanoi municipal People’s Committee has decided to spend VND1.3 billion on a programme of action for consumer rights from March 1 to June 30.

Of the total, VND1 billion will be sourced from donors and the rest from the state budget.

The programme is in response to the World Consumer Rights Day (WCRD) (on March 15).

A selling week will be held from March 16-23 to encourage consumers to buy essential goods and vote for favourite brands and services.

In addition, ten meetings will be held to present the law on consumer rights protection.

Binh Thuan dragon fruit brand protected in the US

The United States Patent and Trademark Office (USPTO) has granted the patent to “Binh Thuan Dragon Fruit”, said President of the Binh Thuan province Dragon Fruit Association, Bui Dang Hung, on January 16.

The protected brand name includes the words Binh Thuan and Dragon Fruit as well as the image of the dragon fruit.

In the face of intellectual property rights disputes, the US organization’s recognition will help Binh Thuan Dragon Fruit to secure a firm foothold in this large market, protecting its prestige and US consumers’ rights, said Hung.

According to patent, the right to use the brand name belongs to individuals and organizations that grow and trade dragon fruits having a certificate of origin from the southern Vietnamese province of Binh Thuan. Producers also must ensure production conditions that meet the requirements of the brand name protection.

The current certification is valid for ten years and can be extended several times, according to US Trademark Law.

Vinamilk gains a foothold in Thai market

The Vietnam Dairy Products Joint Stock Company (Vinamilk) has announced it will begin exporting dairy products to Thailand in the first quarter of this year in a US$10 million deal signed late last year.

In 2011, Vinamilk exported US$140 million worth of products to 15 countries all over the world, making an increase of 72 per cent against 2010.

Last year, the company recorded US$1 billion in turnover and contributed VND2400 billion (US$120million) to the State budget. The figures represented a 37 per cent and 38 per cent increase, respectively, compared to 2010.

With more than 170,000 retail points set up across Viet Nam, Vinamilk's powdered milk now holds a 30 per cent market share.

In 2012, the company will strive for 30 per cent annual growth and will continue to diversify its product lines to meet increasing consumer demand.

Its main products currently include Dielac powdered milk, Ridielac, cereal powder for kids, condensed milk, yoghurt, soy milk and Vfresh fruit juices, which are exported to the USA, Australia, Canada, Russia, Turkey, Iraq, South Korea and Cambodia.

Last August, a powdered milk plant in New Zealand, in which Vinamilk has a stake, became operational. Vinamilk has a 19.3 per cent stake in the NZ$90 million (US$74.43 million) Miraka Milk Powder Plant owned by the New Zealand-based Miraka Limited.

The plant, which is located on the North Island and is Vinamilk's first overseas investment, buys fresh milk from farmers in the Taupo region and produces dairy products for export. It has the capacity to produce 32,000 tonnes of powdered milk a year.

The Miraka project is part of Vinamilk's long-term strategy to achieve its target of becoming one of the world's 50 largest dairy producers by 2017 with annual revenues of US$3 billion.

Haiphong aims for US$500 million in FDI

Industrial zones (IZs) and Economic Zones (EZs) in the northern port city of Haiphong aim to boost both foreign and domestic investment significantly this year.

Specifically, they aim to attract US$500 million in foreign direct investment (FDI), a 42 percent increase over last year, while domestic direct investment (DDI) is expected to reach VND8 trillion ($381 million), a 21 percent increase over 2011, said the city's head of IZs and EZs Management Board Pham Thuyen.

FDI enterprises operating in the EZs and IZs will strive to achieve $1.38 million in turnover, 20 percent more than last year. An 82 per cent increase in DDI is expected, equivalent to VND10 trillion ($476 million), he said.

This year, the global economy is forecast to continue encountering difficulties while the domestic economy will also have a tough year, Thuyen said, adding that the set targets will be achieved because the city has attracted a huge inflow of FDI, especially from Japan.

Unilever to purchase Vietnam’s black tea

The Ministry of Agriculture and Rural Development (MARD) has signed a cooperative agreement with Unilever Vietnam for a project to develop Vietnam’s tea industry.

Under the agreement, by 2015, Unilever will purchase 25,000-30,000 tonnes of Vietnamese black tea, meeting the quality standards of the Rainforest Alliance.

The project aims to help Vietnam increase its black tea exports by supporting producers and growers in improving the competitive edge of their tea.

In addition, the project also aims to attract the participation of 50,000 - 70,000 households in Unilever’s tea supply chain, which will help the company achieve its target to have 500,000 households and small distributors as part of its supply chain by 2020.

Korea Life expands business in Can Tho city

The Korea Life Insurance Co, Ltd has officially opened a branch in the Mekong Delta city of Can Tho as part of its strategy to expand and develop its business network.

The opening of the new office brings the total number of the company’s branches nationwide to 17. It will also provide customers with a wider access to its latest products and services.

The company has been quite successful in expanding its business network almost 170 percent more than other life insurers.

Korea Life Vietnam expects to expand its network throughout the Mekong Delta in the future.

SMEs to enjoy tax payment extension

Vietnam’s small and medium sized enterprises and labour-intensive businesses are set to enjoy a three-month extension on 2012 corporate income tax (CIT) payments.

SMEs and labour intensive firms in the manufacturing, processing, agriculture, textile, and garment, footwear, electronic components and civil engineering sectors will be beneficiaries of a three-month CIT extension for tax to be paid in the first and second quarters of 2012, according to Resolution 02/NQ-CP dated January 1, 2012.

Real estate, banking, insurance and securities companies will not benefit and neither will importers of luxury goods.

For those beneficiaries, however, the tax payment for the first quarter in 2012 shall be paid in July 2012, while second quarter payment shall be done in October 2012.

This move is one of the measures introduced by authorities to reduce the financial burdens for enterprises in what is expected to be a difficult 2012.

In a report proposing this tax extension, the Ministry of Finance said the move would help create favourable conditions for enterprises to spend more capital to stabilize and develop business and production activities but would not badly impact on state budget collection in 2012.

“Together with measures on monetary and credit policies, the extension will be really efficient in supporting enterprises to overcome difficult stages of the economy in the coming time,” said the report.

January CPI predicted at 1%: NDHMoney

Vietnam's consumer price index (CPI) this month is forecast to increase 1 percent month on month, said newswire NDHMoney.

If the forecast, based on Leontief and ARIMA models, is realized, January’s CPI rise will hit a record low compared with other Januaries which are adjacent to the Lunar New Year (Tet Holiday) in the last 10 years.

The lowest rate was the adjacent month of the Lunar New Year in 2009 with a 1.17 percent rise, while the rest ranged from 2 percent to over 3 percent.

The CPI acceleration started from October and November last year with an increase of 0.36 percent and 0.39 percent month on month respectively.

However, the forecast CPI rise for this month has indicated that there are some certain improvements in the correlation between money and goods, said NHDMoney.

In January, along with foods and food stuffs, which are under increasing pressure due to the high demand for the Lunar New Year, other commodities, including tobacco, fashion, household appliances and goods, beauty services, and interior decoration, also post a high rise index in the Tet period.

Inflation expected to hit 8-9 percent in 2012

Vietnam's inflation is targeted at 8-9 percent in 2012, said Vietnam's National Financial Supervisory Commission (NFSC) in its latest report on "Vietnam Economic Outlook in 2012-2013", which mainly refers to developments of inflation in the country.

The inflation outlook in 2012 is forecast to be positive as the consequence of Resolution 11 in 2011 and orientation for further policy tightening, signaled by credit growth of about 15-17 percent for the whole year of 2012, and the impact of weak demand-pull inflation factor tending to decrease and stabilize in 2012.

In addition, external factors, like downward trend of world commodity prices due to the decrease in demand for goods and raw materials, are also expected to have positive impacts to the control of inflation in Vietnam.

However, higher wages and increased prices of some basic commodities such as electricity, coal and others are said to be a negative factor to inflation in 2012.

As calculated by the NFSC, CPI in the first two quarters of 2012 – regardless of seasonal factors -- the Lunar New Year -- and assuming no upward adjustment in prices of basic commodities and exchange rate - will range from 3-4 percent.

If adjusting up electricity prices by 20 percent in 2012, CPI may increase by extra 1.43 percent in 2012.

From the above analysis, NFSC said that inflationary pressures in 2012 will ease significantly in 2011 due to both demand pull and cost-push factors, showing positive signals.

NFSC forecast that CPI growth rate in 2012 will be around 9-10 percent. If international prices go down further, Vietnam's CPI will likely be controlled at 8-9 percent. In 2013, inflation pressures are forecast to continue to decline, ranging from 6 percent to 7 percent.

The direct cause of the country's inflation is the imbalance of money – goods, as once the money supply exceeds the goods supply, inflation is likely to occur.

The evidence is that the total money supply has always increased faster than the country's GDP (gross domestic product) growth rate since 2007, Do Thuc, director of General Statistical Office (GSO) said.
 
Pepper yield may decline this year: ministry

The export pepper yield this year was forecast to fall due to unfavourable weather conditions, according to the Ministry of Agriculture and Rural Development.

"The total pepper exported this year may reach 86,000 tonnes, worth nearly US$619 million. These figures would be down by 30 per cent in volume and 16 per cent in value," the ministry said.

Head of the administrative office under the Viet Nam Pepper Association, Tran Duc Tung said bad weather had strongly affected crops, and many older plants had died.

Since 2001, Viet Nam has been the largest pepper producer and exporter in the world.

The ministry reported that in 2011, the country exported 125,000 tonnes of pepper, valued at $736 million. Although the volume year-on-year increased by only 7.2 per cent, the value surged by 74.6 per cent.

Demand for pepper has risen year-on-year in most markets.

Demand from Spain increased the most, at 270 per cent, earning the country's pepper industry $25.6 million in 2011.

Spain was followed by Singapore with growth of 231.4 per cent, worth more than $21 million. Other markets experiencing significant growth were Egypt at 212 per cent, the US at 158 per cent and India at 101 per cent.

Last year, the price of pepper climbed sharply in both the domestic and export markets, thanks to high demand and low supply.

The price of black pepper soared to a record high of VND161 million ($7,600) per tonne in September 2011, up by 116 per cent against the same period in 2010. The price of white pepper also soared by 99 per cent reaching VND197.5 million ($9,300) million per tonne.

On average, the price of pepper last year was roughly $5,870 per tonne, up by 66.3 per cent over 2010.

However, since the beginning of this year the price has fallen by $800 per tonne.

"The domestic price is falling in line with the world market," the ministry said.

The ministry estimated that the price would continue to decline due to low demand.

Banks profit despite economic woes
 
Benefiting from high interest rates, most of the nation's major commercial banks managed to post healthy earnings and remain profitable during 2011 despite restrictions on credit growth and ongoing economic difficulties.

Vietinbank was the nation's most profitable commercial bank last year, according to its chairman, Pham Huy Hung.

Vietinbank reported earnings of over VND8,000 trillion (US$381 million), an increase of 76 per cent over 2010 totals. Profits, however, fell below the target set for the year, reaching just VND8.5 trillion ($404.8 million). Hung, however, said the bank had targeted 20-per-cent higher profits in 2012.

Nguyen Ngoc Bao, chairman of Agribank, the largest State-owned bank, told the online newspaper vnexpress that Agribank's pre-tax profits in 2011 were at a level equivalent to those of the previous year. Agribank was able to maintain good liquidity despite economic obstacles and was able to lower its bad debt ratio to from 6.67 per cent in 2010 to below 6 per cent last year.

Vietcombank has announced a 2011 profit of VND5.7 trillion ($271 million), an increase of 4 per cent over the previous year, while several other commercial banks – including Eximbank, Sacombank, Asia Commercial Bank, Millitary Bank and Techcombank – were expected to post profits of over VND3 trillion ($143 million). VP Bank's earnings topped VND1 trillion ($47.6 million), a year-on-year surge of 70 per cent.

Many banks continued to worry, however, that their earnings on equity remained low. An official of a Ha Noi-based bank who asked to remain anonymous said that, compared to other businesses which were heavily dependent on borrowing, bank profits seemed meagre.

Former State Bank of Viet Nam Governor Cao Sy Kiem said that the evaluation of a bank's success should be based on assets and capital. By that measure, only a third of commercial banks were able to post solid profits, while another third demonstrated low liquidity and higher levels of bad debt.

Current State Bank of Viet Nam Governor Nguyen Van Binh told the National Assembly in December that annual profits of VND1-2 trillion ($47.6-95.2 million) should be considered low for a bank with charter capital of VND3-5 trillion ($143-238 million) and assets of VND50-60 trillion ($2.38-2.86 billion).

The profits of Vietnamese commercial banks were only adequate compared to those of other business groups, he said, adding that the real profit of a bank was the final residue after deducting all expenses – including provisionary funds for bad debts, allocation for mandatory reserves, and tax payments.

Thailand market promising for VN

Viet Nam's exports to Thailand last year were up sharply in terms of both volume and value, and they could increase further if businesses made better use of market opportunities, a trade official said.

Vietnamese goods sold in Thailand included processed foods, confectionery, processed fruits, food, fresh and dried fish, and building materials, Nguyen Thanh Hung, Vietnamese trade counselor in Thailand, said.

They were present in most northern Thai provinces, even in remote areas, and ethnic Vietnamese living in Thailand liked Vietnamese dried fruits produced by Vinamit Company and office stationery made by Thien Long Group Corporation.

The historic flooding in Thailand last year greatly affected manufacturing activity there, causing Thai companies to revert to imports, including from Viet Nam, to meet domestic demand as well as for re-export.

Thai firms were seeking to import Vietnamese farm produce, fruit and vegetables, especially kohlrabi, longan, and Thieu litchi.

With the harvest seasons occurring at different times in Viet Nam and Thailand, Vietnamese goods had the opportunity to enter the market with efficient trade promotion.

There was great potential even for export of auto, motorbike, and electronic parts.

Thai consumers appreciated Vietnamese goods since they were of better quality than Chinese products.

But Vietnamese firms had to improve design of their goods and diversify products.

They should be more active in participating in international trade fairs since this offered a good opportunity for them to market their products not only to Thais but also other foreign buyers.

They should also ensure stable supply of their products, something some companies had failed to do by not delivered goods in time or in the contracted quantity, causing difficulties for importers.

Vietnamese firms had to join hands to penetrate other markets rather than undercut each other.

Need for support industries

The lack of support industries continues to hamper the nation's manufacturing sector, which still fails to produce high value-added goods or attract sufficient investment, says Industrial Strategy and Policy Research Institute director Phan Dang Tuat.

"Without support industries, Viet Nam still can only depend on agriculture," Tuat said.

Without support industries providing accessories and spare parts, the nation would continue to fail final-product manufacturers, agreed a representative of the Japan External Trade Organisation (JETRO).

Legal incentives were simply not sufficient to stimulate growth in these sectors, said Tuat.

The Government issued Decision No 12/2011/QD-TTg in February 2011, and the Ministry of Finance promulgated Circular No 96/2011/TT-BTC to guide the implementation of that decision, but the extent of the policies has left investors disappointed.

"The policy regimes and incentives are too general and similar to those already in place for small- and medium-sized enterprises," said Truong Thi Chi Binh, director of the institute's Support Industries Enterprise Development Centre. "There are no new or attractive elements that are strong enough to encourage enterprises tap into these sectors."

Former Minister of Trade Truong Dinh Tuyen said that policymakers have failed to target a specific sector for development, allowing limited investment to be spread across various areas. Hs suggested that a few sectors with competitive advantages be selected as spearheads, in co-ordination with final-product manufacturers.

Le Xuan Sang from the Central Institute for Economic Management agreed, noting that the nation had promulgated up to 74 generalised plans and strategies for development of supporting industries.

PetroVietnam unveils new oil survey branch

PetroVietnam Technical Services Corporation (PTSC) unveiled a new company branch yesterday which specialises in geophysical exploration services for the oil and gas industry.

The new branch, a 51 per cent and 49 per cent joint venture between PTSC and CGG Veritas (CGGV), provides 2D&3D (two dimensional and three dimensional) seismic acquisition services.

The joint venture will operate for 20 years, according to PTSC, a subsidiary of Viet Nam's leading oil and gas company PetroVietnam.

The company said the joint venture would help it provide full technical services packages for petroleum exploration and development in Viet Nam as well as in the regional market.

PTSC, which owns VND17 trillion (US$809 million) in total assets and employs 9,000 personnel nation-wide, provides diversified technical services for the oil and gas industry inside and outside Viet Nam.

Headquartered in Paris, the 79 year old CGGV boasts 50 years of seismic survey services in Viet Nam.

PetroVietnam given presidential blessing
 
President Truong Tan Sang yesterday visited the headquarters of the Viet Nam National Oil and Gas Group (PetroVietnam) to deliver seasonal greetings to its leader and staff members.

Sang wished the group more successes in the new year by making the most of new opportunities and hoped it would become the country's leading economic group and reach out to the world.

The group chairman Phung Dinh Thuc said it would continue cutting investment in its non-core businesses this year.

The group would not inject capital into the 79-floor PVN Tower, he affirmed. The tower is one of the highest buildings in Viet Nam with an estimated investment capital of US$600 million. The project is being implemented by PetroVietnam Construction Corporation (PVC), an affiliate of PetroVietnam.

"Last year, PetroVietnam reviewed its non-core projects and it cancelled 12 and delayed 44. As a result, we saved VND7.2 trillion ($151.2 million). Thus, the group's total investment capital last year was about VND90 trillion ($4.3 billion), 27 per cent lower than earlier expectations," said Le Minh Hong, the group's deputy director general.

The group will spearhead five core business sectors, including oil and gas exploration and exploitation; petro-chemical refinery; gas; power; and high-quality oil and gas services.

The group plans to churn out 15.8 million tonnes of crude oil and 9 billion cubic metres of gas this year earning VND660 trillion ($31.4 billion), VND135 trillion ($6.4 billion) of which will go into the State budget. It plans to pump more than VND108 trillion ($5.1 billion) of that revenue into investment, slightly less than last year.

The group reached a total revenue of VND675.3 trillion (US$32.1 billion) last year, of which VND160.8 trillion ($7.6 billion) went into the State budget.

Thuc attributed the good performance last year to higher production, higher oil and gas prices, and better revenues from oil and gas services.

The group's lower business expectations this year stem from the ongoing global economic crisis.

Sang also visited the Party Central Committee's Commission of Inspection, Central Committee of Organisation and the Ministry of Culture, Sports and Tourism.