BUSINESS IN BRIEF 19/3
VN's President commends Nikkei Group
President Truong Tan Sang has cordially acknowledged the contributions of Japan’s Nikkei Group in bolstering trade between the Vietnamese and Japanese business community.
At a March 17 reception for Nikkei Group President Tsuneo Kita in Japan, President Sang also spoke highly of the role the Japanese press has played in elevating Vietnam’s image and boosting socio-economic development.
The Nikkei Group has played an instrumental and active role in disseminating information validating the positive impact of Vietnam-Japan cooperative relations in forums, such as the Future of Asia conference, which contributes to peace, cooperation and development in the region, he said.
Mr Kita affirmed that Nikkei Group has always monitored and disseminated information on Vietnam-Japan relations and Vietnam’s socio-economic situation as well as highlighting the country’s efforts in maintaining macro-economy, promoting economic restructuring and making positive contribution to the region.
As Japan’s leading media group, Nikkei will continue to provide updated information on the Vietnamese business environment for Japanese businesses as a way to consolidate friendship and improved multi-faceted cooperation between the two nations, he concluded.
SBV cuts interest rates
The State Bank of Vietnam (SBV) on March 17 announced a reduction in maximum interest rates for bank deposits in VND and USD.
Accordingly, the maximum interest rate for non-term and under-one-month term bank deposits will drop by 0.2% to 1% per year, while the rate will reduce from 7% to 6% per year for deposits left between one and six months.
The SBV will also apply a reduction from 1.25% to 1% per year to deposits in USD made by individuals and will retain the rate of 0.25% for businesses and organisations.
At the same time, the annual interest rate for longer-term deposits from 6 month and over will be fixed by credit organisations based on the demand and supply of the capital market.
The short-term lending interest rate for five priority areas, namely agriculture, export, supporting industry, small and medium-sized enterprises and high-tech firms will be cut from 9 to 8% per annum.
Vietnam attends Seafood Expo North America
Vietnamese ambassador to the US, Nguyen Quoc Cuong cut the ribbon to kick off opening ceremonies of– Seafood Expo North America 2014– in Boston, Massachusetts.
Eighteen seafood pavilions at the event aim to introduce Vietnamese high quality products and find deeper inroads into foreign markets of the US and other participating nations.
In his opening statements, Cuong said that after 20 years of normalized economic - trade relations, the Vietnam-US trade turnover has increased 130 fold, reaching US$30 billion in 2013. Of the figure, Vietnam’s US exports fetched a healthy US$23.9 billion.
Most notably, aquatic products rank fourth among Vietnam’s exports to the US, hitting a record of nearly US$1.5 billion last year, accounting for 22.6% of the country’s total seafood exports.
He also spoke about recent legislation passed by the US government, including US Farm Bill 2015 and its positive impact on Vietnam’s tra fish and shrimp exports.
The ambassador affirmed that the Vietnamese Government and State have always stood shoulder to shoulder with the US to protect the legitimate rights of Vietnam companies, including thousands of jobs in Vietnam’s aquatic industry.
The event has attracted roughly 19,000 buyers and providers of seafood and frozen products as well as manufacturers of modernised specialized machinery and equipment from over 100 nations around the globe.
Norwegian businesses keen on Vietnamese market
The Norway business community is keen on bolstering economic trade and cooperation with Vietnam, said Finn Kristian Aamodt, acting President and CEO of Innovation Norway.
“Norwegian businesses are especially interested in cooperation in hydro-electricity, oil and gas, shipbuilding, maritime, and aquaculture”, he continued.
Aamodt made the comments on the eve of the departure of Norwegian Crown Prince Haakon Magnus on a working visit to Vietnam from March 18-21, for which leaders are expected to hold high-level discussions on boosting cooperation.
Aamodt said the Vietnamese marketplace has drawn a great deal of attention from Norwegian investors who are looking for a lucrative market to expand their business operations overseas.
“The two countries have many things in common, including a long coastal line that promises a huge potential for bilateral cooperation in the maritime industry,” he emphasised.
Adding that, he believes Vietnam and Norway have a potential for two-way trade turnover of US$550 million this year.
He also recommends Vietnamese businesses invest in Norway, a view shared by Astri Sophie Platou, Director of International Business Section under Oslo Chamber of Commerce, which provides assistance to foreign firms running business in Norway.
For her part, Astri Sophie Platou emphasized that although Norway is not a member of the European Union (EU), it participates in the European Economic Area (EEA), which works to create favourable conditions for Vietnamese investors and is currently engaging in FTA negotiations.
Kjell Martin Grimeland, Vice President of Norway’s SN Power renewable energy company, said his firm has been operating successfully in Vietnam for more than five years, having officially established a representative office in Hanoi in 2010.
The Vietnamese market’s robust growth has offered many excellent opportunities for SN Power, he said, adding that his company is pouring investment in Vietnam’s hydro-electric power sector.
SN Power aims to become an active and long-term trade partner of the Vietnamese electricity sector, he retorted.
“In recent years, the Vietnamese Government has made adjustments in the power market that stimulated SN Power’s operations in the country,” he concluded.
Vietnamese ambassador to Norway Le Thi Tuyet Mai said Vietnam and Norway are expected to complete the FTA negotiations for the early signing of the deal which will be the core link to bilateral cooperation for broader trade ties.
Vietnam and Norway will also promote business exchange and organize trade promotion forums in areas which are favoured by both sides, such as navigation, seafood, oil and gas, and clean energy, Mai noted.
200 businesses to join southeastern trade fair
More than 200 local and foreign businesses will participate in the Southeastern Region Industry and Trade Fair & Exhibition 2014 in Phan Thiet city, the southern Binh Thuan province on April 17.
The information was unveiled at a press conference in Binh Thuan province on March 17.
Deputy Director of the provincial Department of Trade and Industry, Ngo Minh Hung, said that the event aims to introduce the economic development accomplishments, advantages and preferential policies of Binh Thuan and other provinces in the Southeastern economic region.
It will give priority to introducing Vietnamese goods and 90% of products showcased at the fair will be – Made in Vietnam – products and services.
The fair is part of the Economic Cooperation Programme in the southeastern region and the National Trade Promotion Program.
The organizing board expressed hope that the event will help improve businesses’ production capacity and competitive edge in the international economic integration as well as promoting trade exchange among businesses to seek new partners and expand consumption markets.
NZ, Vietnam target US$1bil in trade value
Vietnam currently ranks 20th among trade partners of New Zealand and bilateral trade is expected to reach US$1 billion by 2015.
This figure was unveiled by New Zealand ambassador to Vietnam Haike Manning on the occasion of the scheduled visit to HCM City from March 18-20 by Steven Joyce, New Zealand’s Minister for Economic Development cum Minister for Tertiary Education, Skills and Employment.
The visit will open up opportunities to strengthen cooperation in trade, investment and education between the two nations.
With the removal of tariffs and trade barriers under the ASEAN-Australia-New Zealand Free Trade Agreement (FTA) and the effects of the Double Tax Avoidance Agreement next month, New Zealand expressed hope for further investment in both markets.
The Trans-Pacific Partnership (TPP) agreement, which is expected to conclude later this year, will bring further investment opportunities for both nations.
New Zealand has been always a reliable partner of Vietnam in the areas of its strength such as food, drinks and beverages, education, aviation, agriculture, forestry and tourism, said the New Zealand diplomat.
During the working visit to HCM City, Minister Steven Joyce will meet Chairman of HCM City’s People’s Committee, Le Hoang Quan to discuss economic and trade issues and the important role of New Zealand’s business community in HCM City in stepping up cooperation between the two nations.
He will also meet Vietnam’s leading entrepreneurs and the New Zealand business community in HCM City.
Vietnam, Japan bolster trade links
Leading business representatives from both chambers of commerce and industry attended the Vietnam-Japan business forum on March 17 with the hope of deepening future economic ties between the two countries.
In his speech at the forum, Vietnamese head of state Truong Tan Sang suggested Japanese enterprises intensify long-term business and investment in Vietnam to help the country join the global value chain at a higher level.
He described the participation and commitment of Vietnamese and Japanese entrepreneurs at the biggest forum a testimony to the attention and support from the two countries’ business communities for Vietnam-Japan economic cooperation and bilateral ties.
Over the past 40 years and in particular since both nations established a strategic partnership in 2009, their economic ties have seen vigorous growth in various fields including politics, economic, culture, tourism, labour, education-training and science-technology.
The strengthened partnership and stronger mutual trust have helped bring cooperation between agencies, sectors, localities, businesses and associations closer, Sang said.
In economics, Japan has secured its position as the top economic partner, biggest ODA provider, No 1 foreign investor and fourth biggest trade partner of Vietnam.
Two-way trade experienced a five-fold increase within 10 years, from US$5 billion in 2002 to nearly US$25 billion in 2012.
Many leading Japanese groups have been doing long-term business effectively and stably in Vietnam, contributing to the country’s socio-economic development, industrialisation and modernisation.
The State leader said Vietnam is sparing no efforts to cope with challenges from the global economic instabilities, particularly economic recession. However, the country boasts huge potential for promoting sustainable growth in the Doi Moi (Renewal) process.
Vietnam is going ahead with economic restructuring in combination with renewing growth models based on strategic breakthroughs- fine-tuning market economy institutions, modernising infrastructure facilities, developing high-quality human resources and boosting national industrialisation and modernizsation.
In addition, Vietnam is in the process of broader international integration. With the establishment of an ASEAN economic community by 2015, the country will serve as an important gateway of the Mekong sub-region and become a nucleus of this potential economic centre.
Vietnam’s ongoing free trade agreement (FTA) negotiations with world leading economies will benefit the country’s long-term equal, constructive and mutually beneficiary partnership with other countries.
Vietnam attaches high importance to the Trans-Pacific Partnership (TPP) negotiation process with Japan aiming to create an economic connectivity in the Asia Pacific region.
With the prospect for finalization of 14 FTAs in the 2015-2020 period, Vietnam will become a vital link of the large economic connectivity network with 55 partners including 15 from G-20 members.
This will pay the way for Vietnam to enhance regional connectivity, international economic integration and become deeply involved in the global value chain.
President Sang called on Japanese businesses to expand long-term investment in Vietnam in key areas such as, high technology, energy, shipbuilding, automobile and auto spare parts production, support industry, information & technology, electronics, agriculture, human resources training, environmental protection, public-private partnership (PPP).
With the resolve to expedite comprehensive international integration, more effective measures will be taken to perfect market economy mechanisms, legal regulations and policies and improve competitiveness with a view to building a stable, favourable and transparent investment environment.
This will offer the best possible conditions for Japanese investors to run long-term and effective business in Vietnam for mutual benefit and in the interests of a united and prosperous Asia, he concluded.
At the forum, President Sang also witnessed the signing of a Memorandum of Understanding (MoU) on cooperation between the Japan Chamber of Commerce and Industry (JCCI) and the VCCI.
Can Tho ready for new air routes
The Steering Committee for Southwestern region and the Ministry of Transport in coordination with the Can Tho City People’s Committee on March 17 hosted a conference to discuss ways of accelerating the opening of air routes to Can Tho.
Steering Committee for Southwestern region deputy head Nguyen Phong Quang said the conference provided a good opportunity for airport management agencies to review their activities, and help investors devise plans to open future domestic and international air routes to Can Tho city.
The event also gave the Mekong River Delta region the chance to exploit their potential, attract tourists, and encourage international investors to seek investment opportunities in Can Tho and the Mekong Delta provinces.
Representatives from the Civil Aviation Authority of Vietnam and the Airports Corporation of Vietnam briefed participants on current activities within Vietnam’s aviation sector as well as preferential policies for investors when opening air routes to Can Tho International Airport.
Participants were introduced to localities’ future tourism plans, economic potential and the requirement for domestic air routes such as Can Tho-Da Nang, Can Tho-Lam Dong, Can Tho – Khanh Hoa and international routes such as Can Tho – Siem Riep, Can Tho-Phnom Penh, Can Tho-Bangkok, Can Tho-the Republic of Korea and Can Tho-Taiwan.
Management agencies and investors signed a Memorandum of Understanding (MoU) on the exploitation of flights to Can Tho International Airport.
French businesses tap medical market in Vietnam
Representatives from French medical businesses are due to visit Hanoi and HCM City from March 24-27 to meet and liaise with potential customers, according to the French Trade Promotion Agency (UBIFRANCE Vietnam).
The working visit, organized by UBIRANCE, will provide an opportunity for French businesses to introduce and share their technologies, services and experiences with Vietnamese partners.
These businesses specialize in plastics and cosmetics surgery and providing medical equipment to treat allergic and respiratory diseases.
UBIFRANCE Vietnam said that Vietnam’s medical equipment imports from foreign markets were estimated at over US$634 million last year and is likely to reach a staggering US$1 billion by 2015.
At present, 90% of medical equipment used in hospitals and medical stations across Vietnam are imported from abroad.
Vietnam delivers tanker to Australia
On March 17, the Vietnamese Song Thu Company, under the Ministry of Defence and in co-ordination with the Damen Shipyards Group from the Netherlands, handed over a patrol vessel to an Australian partner in Danang city.
The tanker named Mowamba measures 54 metres in length and 12 metres in width.. Its transport capacity is 800 m3 and it is capable of travelling up to 10 nautical miles per hour, with horse power of up to 1,500.
Mowamba, is the third of four contracted tankers by the Vietnamese company and is equipped with two main engines to serve both port and coastal services.
The vessel demonstrates the skill and capability of Vietnamese shipbuilding engineers and marks the successful development of cooperative relations between Vietnamese enterprises and large foreign groups.
Dong Nai eyes accessing US market
The southern province of Dong Nai is implementing a variety of measures to support productivity and market expansion into the US, aiming to raise overall export growth by 10-11% in 2014.
This year, it will carry out programs on trade promotion, economic restructuring, industrial promotion, and those on labour and credit to ease business difficulties.
It will organise business conferences to capitalize on free trade agreements (FTAs) and the Trans-Pacific Partnership (TPP) agreement due to be signed later this year.
The provincial Department of Industry and Trade (DIT) Director Le Van Danh says the US economy is expected to pick up stream this year, creating numerous prospects for Vietnam’s exports to find a niche in the marketplace.
He says the department is striving to keep regular contact with businesses to more timely address their concerns so as to boost exports to the US.
To this end, it will conduct trade promotion programs and strengthen links with representative offices of economic groups in HCM City to provide more exposure for their export products in anticipation of expanding the market.
Recently, the provincial People’s Committee sat down with the American Chamber of Commerce (AmCham) in Vietnam to work out detailed plans for expanded cooperation in overseas investment and exports, especially in human resource training.
Nguyen Ngoc Tuan, Vice Chairman of the Dong Nai Import-Export Association, says this year the US will remain the No1 importer of Dong Nai products and the business community needs to be keenly aware of technical barriers that the US imposes.
Since late 2013, the purchasing power of products, such as garments, footwear, ceramics, timber products, and machinery and equipment has been on the rebound, especially in the US market.
Based on the number of signed contracts for these products so far this year, this trend is anticipated to continue and bodes well for exports throughout the remainder of 2014.
In 2013 US imports from the province were US$3.17 billion in value, the largest importer and accounted for 30% of the province’s total exports.
When the TPP is signed, the US market will open wide for Dong Nai businesses as tariffs will dramatically decrease, allowing for more competitive pricing and giving Made-in Vietnam products an edge.
Key products which have a tremendous opportunity of finding a footing in the US include footwear, garments, cashew nuts, wood and timber products, steel, agricultural products and seafood.
From now until 2015, the province aims to develop corollary markets, such as Cambodia, Japan, the Republic of Korea, India, Australia, Chile, Myanmar, Sri Lanka, and the United Arab Emirates which have high demands for key provincial products.
Deputy PM makes case for Long Thanh International Airport
Deputy Prime Minister Hoang Trung Hai has emphasised the necessity of building Long Thanh International Airport in Long Thanh district, Dong Nai province as the Tan San Nhat International Airport is overloaded.
He made the remarks while leading a Government delegation to the potential construction site on March 14.
Vice Chairman Tran Van Vinh of the Dong Nai provincial People's Committee, said the project, which was approved by the Government in June 2011, will be capable of receiving 100 million passengers and five million tonnes of cargo each year.
The project requires around VND20.7 trillion (US$973 million) for the clearance of 5,000 hectares of land, which will affect around 5,300 local households.
Deputy PM Hai said that the project is of great importance for the socio-economic development of Dong Nai, Ho Chi Minh City and the Southeast region in general. He said relevant agencies should expedite preparations and plans for the project so that it can be carried out as soon as possible.
He noted that households affected by the project should be paid adequate compensation to allow them to purchase houses in other residential resettlement areas. In addition, the provincial people's committee and the project investors must work together to develop vocational training programmes and find new employment for the 10,000 people of working age who will be affected by the project.
The deputy PM also asked the authorities of Dong Nai Province to call for additional investment in the Dong Nai-Agropark industrial and farm complex project, as it is one of the first modern models of agricultural-industrial development in the country.
Saigon New Port honoured as leading container terminal operator
Saigon New Port Corporation has been recognised as a leading business in developing container terminals, applying modern technology in operation and effectively ultising all available resources.
Deputy Prime Minister Hoang Trung Hai presented company representatives with the title of Labour Hero in recognition of this status at a ceremony held by the corporation on March 15 to mark its 25th founding anniversary.
The Deputy PM commended the achievements the corporation has recorded the past 25 years, making it a successful example of realising Party resolutions on reforming and developing State-owned enterprises.
Though it started as an old riverside port with just four wharfs, Saigon New Port now comprises 14 terminals and two inland container depots. Over the past 25 years, the port has received nearly 36,800 cargo payloads with a total weight of 259 million tonnes.
In 2013, the corporation contributed VND504 billion (US$23.7 million) to the State budget. The import-export container throughput of the port has accounted for more than 80% of market share in the Ho Chi Minh city area and nearly 50% nationally.
Reward interest rate falls to 6 percent
Reward interest rates for VND will reduce from 7 percent to 6 percent per year for short-term deposits of six months or less.
The reward interest rates for US dollars will decrease from 1.25 percent to 1 percent per year, said Governor of the State Bank of Vietnam Nguyen Van Binh.
The State Bank also cut lending interest rate for VND from 9 percent to 8 percent per year in several areas. The rate will be only 7 percent in an agricultural field.
Management interest rate of the State Bank has kept unchanged over the last month but commercial banks have continuously reduced their reward interest rates for VND.
Short term deposits have the reward interest rate lower than the ceiling rate of 7 percent as per regulation. The rate was as low as 5 percent at Bank for Foreign Trade of Vietnam and 5.8 percent at Bank for Investment and Development of Vietnam.
Processing, manufacturing industry attract most FDI projects
Processing and manufacturing industry has attracted the most foreign direct investment (FDI) projects in 2014, according to the Ministry of Planning and Investment’s Foreign Investment Agency.
About 62 newly-registered FDI projects reached US$1.178 billion, accounting for 76.5 percent of total investment capital in January and February.
The country has 122 newly licensed projects with total investment of US$831 million, equal to 80 percent compared to same period last year as of February 20. Forty-one project investors increased capital to US$709 million, equal to 23 percent of the same period last year.
However, FDI projects have disbursed US$1.12 billion, up by 6.7 percent against the same period last year.
SBV to spend VND8 trillion on rice
The State Bank of Vietnam will set aside VND8 trillion (USD380 millon) in preferential credit to buy rice from farmers under a state-backed rice storage programme, said one official.
Governor of State Bank of Vietnam, Nguyen Van Binh, made the announcement on March 15 at a conference on rice production and consumption in the Mekong Delta.
The Vietnamese media have reported that rice prices in the Mekong Delta, considered "rice bowl" of the country, have dropped to some VND3,800-4,000 per kilogramme, a record low given the high volume of the harvest. The state-backed rice storage programme is aimed at helping keep rice prices from falling further.
Minister of Agriculture and Rural Development, Cao Duc Phat, predicted that paddy rice prices will continue to fall, and proposed that the government buy one million tonnes of rice between March 15 and April 30.
Also speaking at the conference, Prime Minister Nguyen Tan Dung approved Minister Phat’s proposal. The PM added that if the government were to buy rice, the programme should ensure a profit of at least 30% for farmers.
Government leaders agreed on the recommendation of local authorities that agricultural restructuring is needed by a reduction of agricultural areas devoted to rice cultivation and an expansion of other crops. However, the PM said that localities must carefully consider which crops should replace rice.
Vietnam ranks as the second largest rice exporter worldwide, but successful branding of Vietnamese rice still lags behind other countries. The PM urged localities and management agencies to pay attention to this dilemma.
VND10 trillion for livestock farming revamp
The Ministry of Agriculture and Rural Development has plans to set aside over VND10 trillion to support local households to switch to a larger-scale livestock farming model until 2020, said Hoang Thanh Van, head of the ministry’s animal husbandry department.
Speaking at a seminar in Hanoi City, Vu Van Tam, Deputy Minister of Agriculture and Rural Development, said the sector would suffer adverse impacts from the country’s signing bilateral and multilateral agreements such as the Trans-Pacific Partnership (TPP) and ASEAN Economic Community (AEC).
Meanwhile, households still make up a high proportion in the nation’s livestock farming sector and are vulnerable to market shocks arising from the country’s integration process, Tam said.
This supporting scheme encourages households to develop breeding in a professional and grand way to increase productivity, lower prices and improve economic efficiency. In addition, farmers will be able to secure food hygiene and safety and environmental protection.
The project will apply to all farming households, excluding those providing breeding services for large groups.
Farmers eligible for the project will get assistance in breeder animals, veterinary medicine, animal feed growing and production, facilities, supply chain development and trade promotion.
Van said the nation still has around 12 million livestock farming households and that it is difficult to help all of them shift to larger-scale farming by 2030. Therefore, they still need support in production and veterinary medicine to survive competition from imported products.
To prevent farmers from turning back to the small-scale family-run business model, Nguyen Thanh Son, head of the National Institute of Animal Sciences, said the ministry should set out conditions. For example, farmers must raise animals in specific areas to prevent pollution, meet animal quantity criteria and present long-term farming schemes to local authorities.
ATM site rentals high
Local banks are paying high rentals for locations to set up their automated teller machines (ATMs).
Saigon Forestry Import-Export Company offers a space for two ATM machines in HCMC’s Binh Thanh District at VND10 million a month while banks will have to pay electricity bills.
Sacombank earlier removed two ATMs from the area due to the central bank’s restrictions on ATM numbers, a source from the company said.
Some sources from large banks told the Daily that there was a price frame for ATM space rentals earlier but now rentals should be negotiated. Rents depend on various factors such as location, street, leasing duration and area.
Rentals have declined in recent years due to the sluggish real estate market but those in the downtown area remain high. For instance, an ATM booth in the center of town costs VND16-18 million a month while rents in outlying districts such as 12 and Binh Chanh are just half this level, said an executive of Eximbank.
Suspended resort projects in Ke Ga to get compensation
Binh Thuan Province’s Department of Finance will evaluate damages which 12 resort projects have suffered as a result of their interruption prompted by a now-suspended port development project in the Ke Ga area.
Speaking to the Daily on March 13, the director of the department, Tang Viet Cuong, said the department would meet with investors of those resort projects on March 20 to assess damages.
Last week the Government Office announced Deputy Prime Minister Hoang Trung Hai’s decision to suspend the Ke Ga port development project as proposed by the Ministry of Industry and Trade.
Besides, as instructed by the Deputy Prime Minister, the government of Binh Thuan will coordinate with Vietnam National Coal and Mineral Industries Group (Vinacomin), the Ke Ga port project owner, in the damage assessment and compensation process.
Cuong said that after damage checks are complete, the provincial government will work with the investors of the 12 projects to set compensation rates before reporting to the Prime Minister.
Vinacomin earlier announced a suspension of the deepwater seaport project in Ke Ga, citing insurmountable technical and economic issues involving the project designed to exclusively export alumina. The first phase investment needed for this project amounted to VND8 trillion.
The 12 resort projects in the area were forced to stop construction and relocate to make room for the port project. When the port project was suspended, the provincial government and Vinacomin agreed to compensate 100% of damages for those resorts whose remaining asset value is below 30%.
In a complaint sent to the provincial government in mid-2012, the investors put their damages at an estimated VND800 billion.
According to Nguyen Ngoc, vice chairman of Binh Thuan Province, after the Ke Ga port project was suspended, the investors can resume work on their resorts.
Investors of some resort projects told the Daily on March 13 that they still wanted to press on with their projects if compensation rates are acceptable.
Nguyen Duc Dang Toan, investor of Blue World Resort, one of the most affected projects, said his resort had suspended operation since December 2007.
Fish farmers earn profits but still in trouble
Prices of Pangasius, or tra fish, in the Mekong Delta have inched up recently, giving a small profit margin to farmers, after staying low over the past two years.
Farmer Nguyen Van Doi from Tien Giang Province said tra fish is now sold to export processing enterprises at about VND24,000 a kilo, a rise of VND1,000 to 1,200/kg against last week.
Ha Van Tinh, general director of Dai Thanh Seafoods in Tien Giang Province, confirmed the price increase after a long time of staying low. His company now buys the fish at VND24,000 a kilo if payment is made within a week and VND24,200 from the second week to one month.
According to statistics of An Giang Seafood Processing and Feeding Association, the standard tra fish for export is priced at VND22,500-VND24,000 a kilo depending on the method of payment.
Nguyen Ngoc Hai, chief of Thoi An Cooperative, said prices in Can Tho’s O Mon District range from VND23,000 to VND24,000 a kilo. “At this rate, farmers can earn little profit but the abandoned fish farms still account for 40% of the total area due to poor prices over the past two years,” he added.
According to Tien Giang’s Fishery Office, after deducting all the relevant costs, farmers can earn VND1,000 to VND2,200 a kilo. The average productivity is nearly 800 tons in seven or eight months for each hectare. As such, farmers can earn between VND300 million and VND650 million a hectare at this point.
Nguyen Van Sang, a merchant of tra fish in An Giang Province, said from the beginning of this year, prices have undergone minor fluctuations and now are still low.
Statistics of Dong Thap’s Department of Agriculture and Rural Development show the area for farming Pangasius reached 988 hectares in the first two months of this year, a decline of 4% year on year. Output however has reached 27,800 tons, a rise of 6% compared to a year ago.
The Ministry of Agriculture and Rural Development said as of end-February 2014, the production of tra fish and prawn had reached 323,000 tons and no decrease was recorded.
Though farmers can make a small profit, small-scale farming households do not have products to sell partly because of previous losses which left them no capital for the next season. Therefore, a shortage is predicted to take place this year, experts said.
Tinh of Dai Thanh Seafoods added the prices might edge up to VND25,000 a kilo due to limited supply. Enterprises are lacking material and now they have to scale down operations while the demand in other countries is recovering.
Duong Ngoc Minh, vice chairman of the Vietnam Association of Seafood Exporters and Producers (VASEP), said prices of imported ingredients to make feed have risen 10% to 20% in the first months of 2014, which will lead to higher production costs for farmers and higher tra fish prices in 2015. Therefore, farmers must be wary and cooperate with enterprises to avoid risk.
Pepper producers urged not to hastily sell product
Local pepper farmers should not sell out their stock now as the period between February and April is the annual harvest of pepper and importers normally seek to buy large amounts of the product at low prices, said the pepper association.
According to the Vietnam Pepper Association (VPA), prices of Vietnam’s pepper have tumbled from VND160,000-170,000 a kilo at the end of last year to around VND120,000 now.
Meanwhile pepper prices in India, Indonesia, Malaysia and other big consuming markets like Europe and America have since early last year stood at US$8,000-US$10,000 per ton, or VND170,000 to VND210,000 a kilo.
When the harvest just starts, farmers tend to sell out their farm produce to cover the investment cost and a large amount of the product will be sold on the market, causing a reduction in prices, while importers may take advantage of this by setting out higher quality requirements to push down the price, said VPA.
In recent years, Vietnam has emerged as the biggest exporter of pepper in the world. Last year, its pepper output accounted for 30% of the world’s total while its supply made up 50% of global commercial volume. Therefore, the association said, Vietnam now has advantages to sell pepper at higher prices in the world market.
Early this month, VPA did research in six provinces in the Central Highlands and southern provinces including Ba Ria-Vung Tau, Dong Nai, Dak Nong, Dak Lak, Gia Lai and Binh Phuoc as the key pepper-growing areas in Vietnam.
It predicted this year’s domestic pepper output at around 120,000-125,000 tons, the same as last year. VPA chairman Do Ha Nam said the global pepper yield this year would be the same as last year, at 340,000 tons.
Information from the Ministry of Agriculture and Rural Development showed that in January, Vietnam exported 19,000 tons of pepper worth US$132 million, down 8% in volume and 5.5% in value versus the same period last year. Half the amount went to Singapore, the U.S. and India during the period.
Exports of local firms rise slowly
Exports of domestic firms in the first two months of this year increased by a slight 4.4% compared to 21.1% recorded by foreign direct investment firms.
According to the latest statistics from the General Department of Customs, domestic enterprises obtained a total export turnover of US$8 billion while FDI firms netted US$13.2 billion in export revenue.
FDI firms took the lion’s share in most products that had high export revenue and growth during the period. For example, 99.7% of export turnover of mobile phones and components, which posted total export value of more than US$3.4 billion in the two months, belongs to FDI firms.
They also made up 60% of US$2.9-billion export turnover of apparel and 75.3% of US$1.4-billion turnover of footwear and leather exports during the first two months while these products used to be the main export products of domestic firms.
HCM City approves landscapes for two artery roads
The HCMC government on Tuesday approved two urban blueprints of scale 1/2000 for Hanoi Highway and Tan Son Nhat – Binh Loi – Outer Ring Road Highway.
The former is 15km long starting from District 2’s Saigon Bridge to District 9’s cultural park with 10 functional sections.
Along Hanoi Highway, a new urban complex with a total area of 106 hectares featuring industrial facilities will be developed at Phuoc Long Port Complex in Thu Duc District. Many manufacturing facilities causing pollution will be relocated such as plants of Ha Tien Cement and Southern Steel.
In addition, Hanoi Highway landscape will be harmonized with some specialized centers along the route such as Rach Chiec Sports Center, District 9’s Saigon Hi-tech Park and Cultural Park as well as the Vietnam National University campus.
The latter, official named Pham Van Dong Street lately, is 15.33km long, running through five districts including Tan Binh, Go Vap, Phu Nhuan, Binh Thanh, Thu Duc with 10 functional sections.
Areas along the highway will be oriented towards modernization with industrial parks to be relocated and residential quarters upgraded, while residential buildings in combination with trade centers will be developed.
The landscapes along Tan Son Nhat – Binh Loi – Outer Ring Road highway will be preserved to promote historical and cultural constructions such as areas along the Saigon River.
Companies set to pay dividends
Sai Dong Urban Joint Stock Corporation (SDI) will spend VND997 billion (US$47.5 million) in cash to pay dividends to its shareholders at a ratio of 83 cent.
This means that each stakeholder will receive VND8,310 ($0.39) per share. SDI shares were traded at VND21,600 ($1.02) yesterday.
Approval of the corporation's shareholders assembly will be solicited from Sai Dong Urban's Management Board at the extraordinary meeting scheduled at the end of this month.
As a member of the real estate giant Vingroup, Sai Dong Urban Corporation, with charter capital of VND500 billion, invested in the Vinhomes Riverside project in Ha Noi's Long Bien District.
In 2013, Sai Dong Urban Corporation reported revenue of VND5.019 trillion ($239 million) and after-tax profit of nearly VND1.16 trillion ($55.23 million). This was 56.8 per cent and 274.5 per cent higher, respectively, than the previous year. The earnings per share of SDI was VND9,666 ($0.46).
Technology giant FPT's management board also passed a resolution to pay cash dividends at a ratio of 30 per cent for 2013, 10 percentage points higher than the goal of 20 per cent set at the FPT's annual shareholder meeting held that year.
Half of the dividends (15 per cent) were advanced last year. The rest will be paid to shareholders in the second quarter of this year if the general shareholders assembly approves the ratio.
Also, FPT's management board has targeted a dividend payment ratio of 20 per cent for 2014, together with a plan to issue shares for its workers from 2014 to 2017, with a value below 0.5 per cent of its charter capital each year.
FPT shares were traded over seven consecutive days, showing gains before stagnating yesterday.
A string of listed companies also announced dividend payout ratios recently, including CNG Viet Nam, Kinh Do Group, Song Hong Construction Company and Vicem Packaging Bim Son Joint Stock Company.
Local commercial banks are also gearing up to announce a dividend payment plan for 2013.
Sai Gon Thuong Tin Bank, or Sacombank, took the lead, with a dividend payment of 16 per cent. Half of this will be paid in cash and the rest in shares, so as to receive additional capital of VND1 trillion.
The Bank for Foreign Trade of Viet Nam, or Vietcombank, is expected to pay dividends in shares at a rate of 12 per cent.
Last year, Viet Nam Bank for Industry and Trade, or Vietinbank, also took the lead to pay dividends in cash at 16 per cent. This year, it is expected to pay a dividend in shares of 10 per cent only.
According to Phan Dung Khanh from Maybank Kim Eng Securities, dividend payments in shares are advantageous to businesses. Instead of having to set aside a huge sum of cash for shareholders, businesses can keep part of the cash to increase charter capital and can use that cash for other purposes.
Low profits were another reason why bankers are cautious as they set out to pay dividends for 2013. Le Hung Dung, chairman of Eximbank, told Vnexpress online that this year, his bank expected to pay dividends between 4.8 to 5 per cent.
He attributed this low dividend value to the pressure for capital preservation and said that this year, the bank had to set aside a large amount of capital for it. He assured investors that dividends would be higher next year.
According to many experts, unlike previous years, investors are likely to prefer receiving dividends in shares, thanks to the recovery of the stock market. He added that if the stock market recovers, the value of shares will also be higher.
Despite positive profits in 2013, some commercial banks have not yet announced their dividend payment plans. Senior leaders of the Military Bank and Sai Gon Ha Noi Bank have said that payment plans are being considered.
REE Corp targets higher turnover in 2014
REE Corporation aims to earn VND2.654 trillion, or $126.3 million, in turnover and VND892 billion, and $42.4 million, in after-tax profit in 2014.
This represents an increase of 10 per cent in turnover, but a drop of nearly 8.6 per cent in profit over last year's results.
The corporation also plans a dividend payout ratio of over 12 per cent of its charter capital.
Song Da 19 in danger of being delisted
The Ha Noi Exchange has asked Song Da 19 Joint Stock Company (SJM) to explain the losses it incurred in 2011, 2012 and 2013.
According to the 2013 financial report that Song Da 19 recently submitted to the capital city's exchange, its after-tax profits were negative for three consecutive years.
According to the Decree 58/2012/ND-CP, a stock would be delisted compulsorily in case the company incurs losses for three consecutive years.
The exchange had to explain the causes and measures taken to deal with the condition of compulsory delisting, the exchange said.
Real estate, construction stocks lead the way
Real estate and construction stocks attracted investors and comprised seven of the top 10 stocks by liquidity on both the national stocks exchanges in the first two months of 2014.
According to VnExpress.net's survey, these stocks included PetroVietnam Construction Joint Stock Corporation (PVX), Tan Tao Group (ITA), FLC Group (FLC) and Sacomreal (SCR).
The rest three of the top 10 stocks were from the financial sector, including the Sai Gon – Ha Noi Bank (SHB).
A total of 6.3 billion shares changed hands on the both bourses in the first two months of this year, equivalent to 25 per cent of the total figure last year.
Bond index to be launched in Q2
The Ha Noi Exchange said that the draft construction and management principles of the bond index have been completed and that the index would be launched in Q2 2014.
The index for treasury bonds are also being drafted and is expected to be introduced in the second quarter.
After nine years of operations, the northern exchange now has 377 listed companies with a total value of VND87.5 trillion, or US$4.16 billion. The average trading value in the first two months of this year reached VND650 billion, or $30.9 million.
Ha Noi approves two new urban areas
The Chairman of the municipal People's Committee Nguyen The Thao has approved the plans for building two new urban areas in Dong Anh District's Tien Duong and Uy No communes.
Under the plan details, the Tien Duong Urban Area would be built in an area of 125 ha with a population of 15,500 people, while the Uy No Urban Area would have 81 ha and 12,200 people. The two urban areas come under the capital's plans for 2030 as approved by Prime Minister Nguyen Tan Dung, with a vision for the year 2050.
Da Nang to recall land from slow business projects
The central Da Nang City has announced that businesses, which were allocated lands for production but are going slow on starting operations, would have to return those areas.
The city also asked those who have invested in seaside tourism areas to start construction by the end of the first quarter of 2015.
Building corporations to submit debt resolution
The Ministry of Construction earlier this week sent a document to its building corporations, asking them to submit plans for debt resolution to the ministry before April 25.
The State holds 100 per cent of the charter capital in the building corporations. The frozen property market in the past few years has made several State-owned (SOEs) Construction Corporations suffer big debts due to high inventory. The Government therefore issued the Decree 206/2013/NÐ-CP, dated December 9, 2013, on debt management at SOEs.
The ministry also asked the corporations to implement the decree within 90 days.
Phu Quoc Island to get five-star resort
The Hoa Binh Tourism Company and Blue Ocean Company have begun construction of a resort and an ecological tourism area in the southern Kien Giang Province's Phu Quoc District.
Covering an area of five ha, the five-star Hoa Binh resort is owned by the Hoa Binh Tourism Company which has invested VND1 trillion, or US$47.6 million, in it. The resort will have more than 300 rooms and a 12-storey commercial centre which will offer shopping and entertainment sections.
The Blue Ocean Ecological Tourism Area will have 40 villas in an area of 10 ha. The first phase of the two projects is likely to be completed by the end of next year.