Vietnam lychee sells well in French market

Luc Ngan lychee of the northern province of Bac Giang sold well in supermarkets in Paris and southern Toulouse city, as provided by Thanh Binh Jeune Import-Export company.

Talking to a Vietnam News Agency correspondent in France, General Director of Thanh Binh Jeune Ngo Minh Duong said the first batch of lychee, a 600 kilogramme shipment to France on June 4, sold out within three days and the second batch has also been popular.

He added that his company plans to import two additional batches of lychee this month to meet market demand, revealing that the company will also import longan berries from the northern province of Hung Yen to sell in France.

Duong also underlined the need to build a brand name for lychee and longan berries to generate prestige and improve the goods’ competitiveness.

Apart from overseas Vietnamese living in the country, Vietnamese lychee was also introduced to French consumers on the occasion of the Vietnam-France friendship festival held on June 6 in Montreuil city

Luc Ngan lychee brand name has received protection certification in Japan, the Republic of Korea and Cambodia and it is expected to be guaranteed in China during the second quarter of this year.

Bac Giang province has mapped out a specific plan to develop lychee in Luc Ngan district to ensure adequate supply for export to new markets, developing 150 hectares under GlobalGAP standards in 2016 and 250 hectares in 2020.

Meanwhile, high-quality Vietnamese lychee meets the standards of the Canadian market, according to a Canadian importer.

Rex Yu from Manley Sales Company, who imported the first batch of Vietnamese lychee on June 10, told Vietnamese News Agency correspondents that Vietnamese lychees meet quality requirements of the Canadian Food Investigation Agency (CFIA).

He expressed his hope that Vietnamese lychee would secure a share in the Canadian market as Vietnamese fresh dragon fruits and longan have, both of which are currently imported by his company.

The company plans to distribute Vietnamese lychee across the country, from British Columbia on the west coast to Quebec on the east coast, within a week.

The Vietnamese Embassy in Canada has conducted a number of promotion campaigns to support domestic agricultural products in the host market, said Commercial Counsellor Hoang Anh Dung.

It also facilitates access to local investors and legal information for domestic businesses to ensure product quality, thus enhancing their competitiveness in the Canadian market.

Lychees and longan berries are Vietnam’s key fruit exports, along with dragon fruit, bananas, mangos, star fruit, rambutan and grapefruit.

Vietnam's fruit and vegetable exports reached US$629 million in the first five months of this year, soaring 17.8% in turnover compared to the same period last year.

The country exported nearly 900,000 tonnes of fruit in the past five months, with dragon fruit taking the lead with 350,000 tonnes, followed by watermelons (250,000 tonnes), longans (110,000 tonnes) and bananas (30,000 tonnes)

Vietnamese bananas enter Japanese market

Vietnam recently exported 22 tonnes of bananas to Tokyo, Japan.

This is the first batch shipped under a contract between the U&I Agriculture Corporation (Unifarm) and its Japanese partner.

The bananas were grown at the An Thai hi-tech agricultural park across more than 411 hectares of land in southern Binh Duong province.

The park is expected to become a modern, productive and high-quality agricultural community applying advanced technologies transferred to farmers under contracts with Unifarm. The company intends to replicate the model across Vietnam.

Confidence booms as domestic economy blooms

The government and the national Assembly have expressed their confidence in the country’s economic prospects.

Prime Minister Nguyen Tan Dung said that the economy would grow higher in this year’s second quarter and “will definitely reach its targeted 6.3% growth rate” in 2015. For 2016-2020, the rate would be 6.5%-7% per year, Dung said.

The economy grew 6.03% in this year’s first quarter, according to the government report.

“We succeeded in curbing inflation at a low level of 0.83% in the first five months of the year. We will keep it below 5%, not only for this year, but also for the years to come. This will greatly benefit production and consumption”, he said.

National Assembly Deputy Chairwoman Nguyen Thi Kim Ngan told the legislature that based on positive socio-economic achievements in 2014 and this year’s first five months, many National Assembly members agreed that the economy had rosy prospects ahead.

Deputy Tran Hoang Ngan from Ho Chi Minh City said the economy was strongly recovering with solid growth, especially as the inflation rate remained low over the past four consecutive years.

“Notably, Vietnam’s investment effectiveness has been improved, with the incremental capital output ratio [ICOR] decreasing from 6.3 in the 2006-2010 period to 5.2 in 2014, said Ngan, who is also a senior economic expert.

He cited the International Monetary Fund, which recently announced that the government’s current account enjoyed a surplus over the past four consecutive years, currently at 5.4% of gross domestic product (GDP). Meanwhile, the 2006-2010 period suffered from a deficit of 6.5% of GDP.

“Additionally, economic restructuring has helped reduce the number of weak banks and bad debts. Credits grew 5% in the first five months of this year, the highest rise over the same period in the past years’, Ngan said.

Dung stressed that in 2016 bad debts would be reduced to only 3%.

“We are applying study solutions to solve these issues.”

According to the Vietnam Consumer Confidence Index for May 2015, released this month by ANZ-Roy Morgan Research, the index stayed at 140.2 points in May, far higher 123.3 points in the same period last year, and higher than the long-term average of 131.8 for May every year prior.

Regarding private financial health, 36% (up 1% on-month) of respondents said they were better-off financially than one year ago. Only 18% said they were worse off.

Some 56% said they and their family expected to be better-off financially by May of 2016, versus only 5% who expected to be worse off over the next year.

Thinking of economic conditions in Vietnam over the next 12 months, 53% said they would have good times financially. Only 12% said “bad times”.

Additionally, 61% said they would see the economy have “good times” over the next five years, while only 5% said “bad times”.

Sacombank, KCCI team up for customer network expansion

Saigon Thuong Tin Commercial Bank (Sacombank) and the Korea Chamber of Commerce & Industry (KCCI) signed a cooperative memorandum of understanding (MoU) on June 10 to develop their customer networks in the coming years.

Both sides will join hands to help Korean enterprises and Sacombank clients explore cooperation and investment opportunities in Vietnam. Meanwhile, KCCI will introduce Korean firms in the country to use Sacombank’s services such as payment accounts, credit, international payments and cash management.

Sacombank and KCCI will also support each other in market surveys, and investment and trade information.

KCCI has two representative offices in China and Vietnam to help Korean firms invest in the two countries and other markets in Southeast Asia.

According to a statement released on June 10 by Sacombank, Korean investors registered US$7.32 billion for 505 new projects and 179 operational projects last year. These projects are in manufacturing, processing, real estate, hotel and other sectors.

Auto imports contribute much to city’s tax revenue increase

HCMC’s tax collections in the year’s first half are estimated to rise to VND46.5 trillion, with completely built-up auto imports contributing a major part.

The HCMC Customs Department put imports of under-nine-seat CBU autos in January-June at US$330 million, up a staggering 200% against a year ago. This strong increase contributes an additional VND5 trillion to the city’s tax revenue in the period.

HCMC is one of the localities with high CBU auto imports. Imported autos are currently subject to import duty, special consumption tax, value-added tax (VAT) and registration fee.

Besides, the higher tax revenue in the city in the period is credited to more tax collections from steel, apparel, footwear, computers and components. For example, steel imports have gone up by around US$60 million year-on-year, resulting in a tax increase of some VND300 billion.

Fuel imports have seen a decline of 20% as the world oil price has dropped significantly. However, tax and fee collections from fuels remain stable as their environmental protection fees have tripled for certain products since May 1.

The department said of the VND46.5 trillion, export and import tax collections account for VND19 trillion and VAT VND27.5 trillion. The total figure represents nearly 52% of the whole year’s target.

However, the city has seen tax collections in some areas shrinking. The VAT exemption of imported fertilizers, animal feed and materials, agricultural machines and tools, and offshore fishing boats since the beginning of this year has led to a loss of some VND1.6 trillion.

In addition, budget collections will lose approximately VND1 trillion as Vietnam is lowering import tariffs to fulfill its commitments to the free trade agreements with other countries.

This year, the Customs Law allows enterprises to conduct export and import procedures at any customs offices. Therefore, HCMC cannot collect taxes for the goods which are imported via ports in HCMC but importers register for customs clearance in other localities.

Vietnam urged to boost institutional reform

Vietnam needs to speed up institutional reform and adopt a new growth model to support the economy to expand 7.5-8% in the next 10 years, local and foreign experts said in a new policy study of the Fulbright Economics Teaching Program.

Called “Institution Reform: From Vision to Reality” the study was discussed at a seminar organized by the Fulbright School in HCMC Wednesday. It was conducted by a group of local and foreign experts including Vu Thanh Tu Anh, Laura Chirot, David Dapice, Huynh The Du, Pham Duy Nghia, Dwight Perkins and Nguyen Xuan Thanh.   

Speaking at the opening of the seminar, Pham Duy Nghia described Vietnam’s economy as a patient whose diseases have been identified. Prescriptions have been made but there are certain hurdles affecting the treatment process, he noted.

Nghia said measures have been worked out to solve the country’s economic woes but have not been implemented effectively. “I think institutions have failed to keep up with reality.”

Institutional reform requires legislative and judicial reforms. The 2013 Constitution and political declarations in the past time have revealed a grandiose reform program, but what Vietnam really needs is laws that lay the groundwork for national governance in the next decades.

“We have talked much (about reform). Now is the time to take actions,” Nghia said.

Huynh The Du said the biggest question is how to reform and where to reform, not what to reform.

Du proposed establishing a reform alliance grouping the Party, the legislature, judicial and administrative agencies, the private sector and civil society. The leadership and guidance role of the Party should focus on policy orientations for national development. Public feedback is important to the process of adopting good policies.

The Party needs to create a fair competitive mechanism for selecting talented and ethical leaders, promote the rule of law in the country, build an administration able to govern the nation and consider the private sector as a partner in an alliance to make the country prosperous.

At the seminar, economic expert Tran Dinh Thien, lawyer Tran Huu Huynh and other experts were of the opinion that law enforcement agencies now have a stronger voice than the legislative and judicial bodies. Therefore, they underscored the importance of setting up a new mechanism to ensure a balance among these bodies.

GMS nations agree on stronger cross-border transport, trade

Countries in the Greater Mekong Subregion (GMS) have agreed on measures to promote the development of economic corridors, facilitate cross-border transport and trade, and enhance cooperation and private sector participation.

Government ministers and senior officials of Cambodia, China, Laos, Myanmar, Thailand and Vietnam reached agreement at the GMS Seventh Economic Corridors Forum in China on June 11, according to a statement released by the Asian Development Bank (ADB) in Vietnam. The countries share the Mekong River.

Stephen Groff, vice president of the Asian Development Bank (ADB), said GMS leaders strongly committed their countries would promote trade, tourism, industrial development, and other economic activities along GMS economic corridors.

“The development of new special economic zones, support for e-commerce, and other activities that will be undertaken following on June 12’s forum will have a transformative impact on businesses and communities in every GMS nation,” Groff said.

In a joint statement, ministers and senior officials from the six GMS countries called for a Transport and Trade Facilitation Action Program to enhance the cross-border flow of goods and people, and for a coordinated approach to developing urban areas throughout the region.

They also endorsed the Framework on GMS Cross-border E-commerce Cooperation, which seeks to advance the development of cross-border e-commerce through shared consumer markets.

The GMS representatives emphasized the importance of involving local authorities and communities, as well as the private sector, in corridor development.

According to ADB, the Sixth Economic Corridors Forum (ECF-6) with the theme “Developing Economic Corridors through Transport and Trade Facilitation & Economic Zones” was held in Hanoi City in August last year.

Danang’s tourism industry badly affected by MERS-CoV

The outbreak of Middle East Respiratory Syndrome caused by Corona virus (MERS-CoV) in the Republic of Korea (RoK) has badly affected travel agencies in Danang city.

According to the city Department of Culture, Sports and Tourism, the RoK has been among top 10 countries with a large number of tourists to Danang. The RoK ranked second with 107,008 arrivals to the city last year.

On average, some 11,000 RoK tourists arrived in Danang Airport a month.

Representatives of Vietnam TravelMart, Omega, Vietravel and other travel agencies said that the number of Korean inbound visitors and the city’s outbound tourists to the RoK show a decline.

By June 11, the number of Korean tourists to Danang city through Omega Travel had been down by 30-40%, Chang by 50%, and Vitours by 5-10%.

Meanwhile, 95% of Danang tourists cancelled their trips to the RoK in June.

Maize imports rise as rice exports fall

Maize imports in the first five months of 2015 are on the rise but rice exports are on the decline, according to figures from the Ministry of Agriculture and Rural Development.

Viet Nam imported 2.87 million tonnes of maize, worth US$622 million, up by 30.3 per cent in volume, and an increase of 16.8 per cent in value compared with the same period last year.

The country also imported 700,000 tonnes of beans and other materials for processing of animal feed worth nearly $1.4 billion.

Meanwhile, exports of rice from Viet Nam over the same period reached 2.08 million tonnes, worth $875 million, a decline of 255,000 tonnes in volume and $138 million in values over 2014.

In all, the value of imported animal feed and other materials for the food processing industry in the first five months amounted to nearly $2.3 billion, nearly triple the total value of rice exports over the same period.

Authorities have been urged to re-structure the country's planting systems, aiming to reduce material imports while easing the pressure on rice consumption.

The programme to re-structure rice plantation to other crops including maize began in 2013 when the country's rice exports were stagnant.

However, the programme has faced challenges in many localities across the country.

The slump in the world's farm produce prices, including maize prices, has caused local agricultural products to be less competitive than imported goods.

Maize prices have dropped to less than VND5,000 per kg since the end of 2014, making maize growers' profits lower than rice growers'.

It has forced many farmers to return to rice cultivation.

Huynh The Nang, chairman of Vietnamese Food Association, said that global demand for rice had changed greatly compared to five to 10 years ago. Rice growing countries have increasingly raised their output, while rice buyers have also been promoting rice production.

"It's time for Viet Nam to re-consider rice production and exports with an aim to raise the added value of this product and a bigger effort to change rice into more necessary crops," he said.

Wartchdog warns of TV shopping risks

The Viet Nam Competition Authority has warned consumers to be careful when shopping via television channels (TV shopping) as it may pose a threat to their consumer rights.

TV shopping has become increasingly popular in recent years in Viet Nam.

However, the competition authority has pointed out that the greatest problems posed by TV shopping are false advertising, lack of clarity in the origin of products, deceptive reward programmes, and ignorance of consumers' complaints.

The authority said that when shopping via TV channels, consumers have no opportunity to test the products directly, so they may end up disappointed by the products' quality or usefulness, which could differ greatly from what was advertised.

Many products sold through TV channels have been found to be of unclear origin and poor quality, the authority said. According to consumers' claims, some of the rewards they had received from TV shopping networks were fake or low-quality products, or the customers had to pay a sum of money to receive the rewards.

In addition, some firms were also ignorant of customers' attempts to return products even though regulations stipulate that consumers have a right to unilaterally terminate the contract within ten days if the product is not the same as what was advertised.

A variety of products are sold via TV shopping, such as cosmetics, jewellery, supplementary foods, watches and gym equipment.

According to the competition authority, consumers should verify information in advertisements before purchasing products via TV shopping networks.

In particular, customers should be careful with products for daily use which are sold at extraordinarily high prices, such as shampoos, rinses, skin creams and home appliances, as well as products which were advertised as premium quality.

Consumers can dial 1-800-6838 for support from a consultant, or they can send their claims to the competition authority via the website www.bvntd.vca.gov.vn or email bvntd@moit.gov.vn.

Binh Duong sees $21.5b in foreign direct investment

Binh Duong received nearly 2,550 foreign direct investment projects between 2010 and 2015, bringing the total registered capital to US$21.5 billion, the provincial People's Committee's Chairman Tran Van Nam said.

He said foreign direct investment (FDI) capital in the southern province was estimated to exceed $1 billion this year.

The provincial Department of Investment and Planning said the FDI projects had an average capital of less than $10 million each, and the largest among them was a $1.2-billion real estate Binh Duong New City project, invested by Japan's Tokyu Corporation.

About 12,370 firms received business licences between 2010 and 2015, raising the total number of local companies to nearly 19,640, a two-fold increase from the beginning of the decade.

The total registered capital increased to more than VND146 trillion ($6.7 billion), 2.2 times higher.

During the period, the total investment in the province reached VND263 trillion ($12.06 billion), eight per cent of which was contributed by the state budget, while 43.1 per cent came from FDI.

The industry will continue to be the locality's key economic driver to boost urban, services and trade development in the next five years.

The province's exports are also expected to expand at an average rate of 19.5 per cent annually. Its foreign trade revenue is forecast to exceed $20 billion this year, with $16 billion worth of imports and $4 billion of exports.

Vinamilk inks dairy deal with Lam Dong

The Viet Nam Dairy Products JS Co. (Vinamilk) has signed a framework agreement for co-operation with Lam Dong Province for breeding dairy cows in the province through 2020.

The deal will help Vinamilk set up an area from where it will obtain fresh milk and build large farms and a new milk processing factory to develop new products.

Lam Dong has an "Agriculture – Farmer – Rural development" policy and the co-operation will help make dairy cows a "key domestic animal" in its agricultural sector, increase the ratio of animal husbandry and contributing to local economic development.

Lam Dong authorities have promised to create the best conditions for Vinamilk to build two to three milk cow husbandry farms with a total of 10,000 cows and modern technologies.

The company will set up a model cow farm for local farmers to study and learn.

It also plans to build a breeding centre which will provide imported purebred Holstein Friesian cows to local farmers and households to increase productivity and quality.

Vinamilk will set up milk buying centres to purchase at least 90 per cent of the produce of farmers at specialised dairy farming zones set up by the province.

The centres would also provide advanced farming techniques, feed, and cows for breeding, training in animal breeding and veterinary medicines to local farmers, the company said.

Vinamilk has provided 150,900 euro for building 30 model household cow breeding farms.

Vinamilk's purchase of fresh milk in Lam Dong has increased from 3,000 tonnes in 2008 to 16,000 tonnes last year.

Quang Binh pledges funds to lift industry

Central province Quang Binh issued Decision No 1490/QD-UBND on Wednesday regarding a programme to stimulate the local industry on an estimated spending of VND40 billion (US$1.83 million) by 2020.

The sum includes VND30 billion ($1.4 million) from the provincial budget, while the remaining amount will come from the national industry boosting programme.

The provincial programme focuses on offering vocational training to more than 3,000 local workers and improving the vocational and management capabilities of another 500 workers, alongside building 16 technology demonstration models expected to introduce advanced technology and new products.

Additionally, it provides financial support for industrial businesses and helps them attend domestic and overseas trade fairs to promote their products.

The locality is also drawing up detailed plans to develop local industrial clusters and economic zones and invest in infrastructure development.

A highlight of the programme is support for some 130 industrial businesses in rural areas to expand their businesses and transfer advanced technology to improve production.

The spending is part of the provincial efforts to boost the industry and handicraft sectors towards sustainable development in a bid to enhance competitiveness and contribute to economic restructuring.

Maritime Bank gets nod to acquire finance firm

Maritime Bank has received approval from the State Bank to acquire the Textile and Garment Finance JSC, an affiliate of the Viet Nam National Textile and Garment Group.

State Bank Governor Nguyen Van Binh issued the decision last Friday, saying that it would take effect on July 6. The company will be renamed Maritime Bank Finance Company Limited.

A shareholder meeting was told in May that the acquisition would turn the firm into a consumer finance company.

The bank will also complete a merger with the Mekong Development Bank in the second quarter.

The new institution will have VND11.75 trillion ($560 million) in equity and VND113 trillion ($5.38 billion) in total assets.

Da Nang, Soc Trang sign IT deal

The central city and southern Soc Trang Province signed a co-operative agreement on information technology (IT) application and development for the 2015-2020 period.

The central city has promised to help Soc Trang develop e-government services and encourage administrative reforms, the provincial competitive index and IT.

Vice-Chairman of Da Nang City's People's Committee, Phung Tan Viet, said the agreement would help reduce the need for funds from the state budget since the two sides will support each other.

The central city developed an impressive IT park by centralising IT centres and two software parks that include 140 IT companies and more than 2,000 employees.

New luxury tax proposal may raise car prices by 30%

Automobile manufacturers and importers in Vietnam have protested a new proposal from the Ministry of Finance which seeks to change how luxury tax on cars is calculated.

Under the ministry's plan, the special consumption tax on all vehicles with fewer than 24 seats will be based on their retail prices, with rates ranging from 15% to 60%.

The proposal, set to take effect on January 1 next year, is aimed to create a level playing field for importers and producers since their cars will be treated the same, the ministry said.

Currently, the luxury tax on imported cars is calculated on the Cost, Insurance Freight (CIF) price rather than the final retail price, a policy that manufacturers said could give importers an unfair advantage.

They said local products could not compete with imported cars since local cars are taxed based on retail prices, which include a number of additional costs.

Many automobile importers, after learning about the new proposal, said they are asking the government to keep the current policy unchanged so that the market and business environment is not disrupted.

If sales go down, tax revenues will also fall, they said.

It is "reasonable" and "accurate" to tax imported cars on their CIF prices because the prices already carry the taxes that foreign manufacturers have paid before shipping the cars to Vietnam, news website VnEconomy quoted VIVA, the association of car importers in Vietnam, as saying.

Strangely, even local carmakers are not happy with the proposal. The new policy, with tax rates as high as 60%, it is not exactly what they want, which is to lower the luxury tax to spur consumption.

The Vietnam Automobile Manufacturers’ Association has been urging the government to calculate the tax on delivery cost, before sale and post-sale costs are added.

The Ministry of Finance, however, is leaning towards collecting more taxes from importers.

Speaking to Thanh Nien, representatives of many importers and manufacturers in Ho Chi Minh City said the new tax scheme, if applied, will increase car prices by 20%-30%.

This will have an adverse impact on the market, they said.

"When taxes go up, we are forced to hike prices. In the end, no one other than consumers will be hurt," a representative of a distributor who wished to stay unnamed said.

Nguyen Minh Dong, an industry expert, also said increases in taxes will not help boost the economy, but may hamper its growth.

In fact, "the biggest problem" with Vietnam's auto industry is that here a car is subject to a wide range of taxes and fees, making it "extremely expensive" for the majority of consumers, he said.

The Japan Business Association in Vietnam has recently warned that if local policies for the auto industry continue to be ineffective, the industry will hardly survive when cars brought from other Southeast Asian countries are free of import duties in 2018 under a regional agreement.

Increased imports will create trade deficit and in the end, hinder economic growth, VnEconomy quoted the association as saying at a recent meeting.

Vietnam's carmakers posted sales of 157,810 units last year, compared to 1.3 million in Indonesia, nearly 900,000 in Thailand, and 700,000 in Malaysia.

Imports have been increasing considerably as the government has reduced import duties gradually in accordance with trade pacts that Vietnam have signed with other countries.

Vietnam imported 72,000 complete-built-unit cars last year, twice the number of 2013, the association quoted official statistics as saying.

A total of 45,000 cars, worth over US$1.2 billion, were brought into the country in the first five months of this year.

Vietnam coal exports grapple with El Nino year

China, Japan and other Asian buyers of Vietnamese coal can expect more uncertainty in the volume of shipments this year as scorching weather linked to the El Nino phenomenon raises domestic power consumption to a record, adding pressure on regional supply of the fuel.

Electricity demand hit 14.96 billion kilowatt-hours in May as households and businesses turned up air-conditioning to beat a heat wave that has enveloped the country since early last month.

That led to an 11.31% increase in power consumption in the first five months from a year earlier, with the share of coal-fired output rising to more than a third of overall generation.

During the period, Vietnam's coal exports to countries including India and the Republic of Korea fell a record 77.2% to 895,000 tonnes.

Coal demand in Asian countries such as India and Vietnam has also been boosted by the loss of hydropower owing to the heat wave, forcing utilities to turn to other fuels - largely coal.

Benchmark Australian prompt coal export prices have climbed 6.5% since the beginning of the month to US$61.70 a tonne.

The cut in Vietnam's coal exports is also part of a downtrend of about 10% a year that began in 2010.

Indeed, Vietnam is expected to start importing thermal coal from 2017 as ever-increasing demand for power exceeds domestic availability.

Since 2010, Vietnam has been a net consumer of oil, another fuel. Oil demand grew 7.5% annually in the 20-year period ended 2013, the region's fastest and more than China's 6.5%, ANZ said in a report early this year.

"Vietnam will need to import coal from 2017 for power generation, while we see no need to do so anytime sooner," said an official at Vinacomin, the country's top coal mining group, declining to be identified as he was not authorised to speak to the media.

Mixing diplomacy with trade

Business executives met with Vietnamese commercial attaches and counsellors who will soon be stationed in India, the US, Belgium, Sweden, Egypt, Mexico, Morocco, and Japan at a meeting in HCM City on June 16.

The meeting was meant to help the diplomats understand businesses' requirements and how they can help promote Vietnamese investment and trade in the countries they are headed for.

Dang Hoang Giang, deputy chairman of the Vietnam Cashew Association, said his business group hoped they would help link Vietnamese businesses with foreign partners, especially in the US and EU.

Recently many Indian cashew businesses had made a beeline for Vietnam to take advantage of lower costs, and the Vietnamese commercial counsellor in India should apprise firms there about investing in Vietnam.

He as well as several others said commercial counsellors and attaches should regularly update Vietnamese businesses on new hygiene and food safety requirements in the US.

Dao Tien Dung, office manager at the Handicraft and Wood Industry Association of HCM City, said he wanted the diplomats to promote Vietnam's wood products and its annual exhibition in foreign markets.

Attendees said besides working on increasing trade, the diplomats should also keep on top of trade barriers in foreign countries and keep Vietnamese businesses informed.

Dinh Hong Ky, chairman and CEO of Secoin Building Material Corporation, said since e-commerce plays an important role in connecting Vietnamese businesses with foreign partners, the country's commercial agencies abroad should set up specific e-commerce portals for each country.

He also wanted the diplomats to help assess Vietnamese businesses' foreign partners.

Thai Van Truong, the Vietnamese commercial attache in Washington, said trade between Vietnam and the US had shot up in recent years and the US had become one of Vietnam's most important trade partners.

The US had large investments abroad but not in Vietnam, he said, adding the upcoming Trans-Pacific Partnership would open up opportunities.

Ta Quang Hoa, commercial attache in Morocco, said the African country had much demand for products exported by Vietnamese companies like seafood, computers, and copra.

"Those businesses that are interested in the [Moroccan] market can contact me, and I'll wholeheartedly support them."

The meeting was organised by the Investment and Trade Promotion Centre of HCM City.

Kien Giang works to expand marine-based economy

The southern province of Kien Giang has grown by an average of 11.4% between 2011 and 2015, with marine-based economy making up 75.6% of its gross domestic product (GDP) .

Its GDP per capita is estimated at US$3,154 this year, twice that of 2010.

According to Le Khac Chi, Deputy Chairman of the provincial People’s Committee, the focus of its maritime strategy was coastal and maritime tourism, particularly in Phu Quoc Island.

The island has attracted 189 of the 242 tourism projects of the province over the past five years, including 37 currently operational ones worth over VND1.8 trillion (US$83.1 million), mainly hotels, resorts and shopping malls.

A highlight is the 300-hectare Vinpearl Phu Quoc eco-tourism complex which offers a 750-room five star hotel, an entertainment centre and a world class golf course.

This year, the province expects to have 370 accommodation options with 7,750 rooms and suites, 71 percent higher than 2010, including twelve 3-5 star hotels located primarily in Phu Quoc, Rach Gia and Ha Tien.

Additionally, the locality has worked to develop fish farming and processing for export purposes.

Quang Trong Thao, Deputy Director of the provincial Department of Agriculture and Rural Development, said the area for coastal fish farming has expanded from 119,000 hectares in 2010 to 173,000 hectares this year, including 95,000 hectares for prawn farming.

The province plans to scale up prawn areas in Tu Giac Long Xuyen region and boost prawn outputs in U Minh Thuong region while increasing the application of advanced technology and adopting domestic and global standards for prawn farming, such as GAP, GlobalGAP, ASC and MSC, he added.

During the period, 14 seafood processing plants were built with a combined capacity of 138,000 tonnes per year, bringing the local capacity to nearly 283,000 tonnes per year in total.

The locality is forecast to produce 58,000 tonnes of frozen seafood this year and generate an export revenue of US$170 million, up 56.5% and 7.8%, respectively.

Since 2011, Kien Giang has invested VND111 trillion (US$5.2 billion) in its marine-based economy, 30 percent of which was sourced from the state budget.

The province has upgraded its transport and irrigational infrastructure, including a number of roads, fishing ports, storm-proof docks and breakwaters, among others, said the local Department of Investment and Planning.

It will continue to develop marine-based industries by 2020 by expanding its networks of roads, power and water supply as well as airports and docks while attracting more tourism investments in Phu Quoc, Rach Gia and Ha Tien alongside seafood processing projects.

Preferential policies will be adopted to encourage the private sector’s involvement in marine-based development and marine resources management.

Conference discusses ASEAN Economic Community

A conference was held in Hanoi on June 16, scrutinising the establishment of ASEAN Economic Community (AEC), a pillar of the ASEAN Community that will be formed by the end of this year, and Vietnam’s preparation for its involvement in the community.

Hosted by the National Assembly’s Committee for External Relations, the event was in preparation for a hearing on the process of building the ASEAN Community, which is scheduled to be organised on August 18.

Addressing the event, Deputy Minister of Industry and Trade Nguyen Cam Tu briefed participants on the nature of AEC, saying that the community is a framework for deeper economic integration among ASEAN member nations, formed as the result of integration initiatives for 12 priority fields within ASEAN. The 12 fields comprise seven commodities, including farm products, aquatic products, electronics, wooden products, rubber, automobile, and textiles and garment, and five services tourism, health care, aviation transport, information technology and logistics.

Deputy Minister Tu highlighted that the formation of the AEC aims to turn ASEAN into a common production base and market with free circulation of goods, services, investment, skilled labourer, and capital flow; while promoting balanced development among the group’s member states, improving competitiveness of the regional economy, and boosting the regional economic integration into the global economy.

A member of the ASEAN since 1995, Vietnam has fully participated in and had many initiatives contributed to the group. The country has also strictly implemented the commitments of the AEC formation, and is among members having completed the most commitments, according to the Deputy Minister.

At the conference, representatives from the NA’s Committees for External Relations, Economy, and Finance-Budget reported the building and implementation of legal documents related to Vietnam’s integration process and legal harmonization within ASEAN.

Participants discussed challenges and opportunities facing the ASEAN after the ASEAN Community is formed, concurring that the establishment of AEC in particular and ASEAN Community in general, will further forge links within the bloc.

They also underlined the need for Vietnam to step up communication efforts to enhance public awareness and social consensus on the ASEAN Community, proactively participate in programmes enhancing links within ASEAN, and speed up administrative reform, especially in trade.

Founded in 1967, the Association of Southeast Asian Nations (ASEAN) groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

The Hanoi Promotion Agency was officially founded at a ceremony on June 15 in the presence of the Chairman of Hanoi Municipal People’s Committee, Nguyen The Thao.

Its task is to propose ideas to city authorities on how to attract investment opportunities, as well as further promote tourism in Hanoi.

The agency will also help provide information on foreign and domestic markets for local enterprises and introduce potential partners.

Municipal People’s Committee Chairman Nguyen The Thao said that the establishment of the agency will assist the capital city to accomplish its targets for the 2015-2020 period and following years.

He requested all agency staff closely coordinate with related bodies to do the best job possible.

EU - a tough market for Vietnam’s seafood industry

A proposed free trade agreement (FTA) between Vietnam and the European Union (EU) is expected to reduce tariffs and make the sales prices of fish and seafood exports more competitive.

However, businesses operating in the fishing and seafood industry have their work cut out to meet with the strict food safety requirements of the EU said speakers on June 4 at a conference in HCM City.

At the conference sponsored by the European Trade Policy and Investment Support Project (EU-MUTRAP), speakers said though the volume of exports to the EU has been steadily rising, so have the number of safety violations.

The FTA is expected to be signed in the near future and that will open up many opportunities for fish and seafood exports said Claudio Dordi, technical assistance team leader for the EU-MUTRAP project.

However, the technical standards of the European Commission (EC) market will remain unchanged, he said, suggesting that Vietnamese businesses need to be proactive in getting their operations up to snuff and in compliance with the regulations.

Fish and seafood have been cited a top product in the EU, however, the number of warnings issued and flat out rejections of product by customs have been steadily inching up Dordi cautioned.

In 2012, 64 seafood product shipments were returned, a sharp rise from 2002’s figure of 26. From 2010 to May of this year, 183 seafood shipments were issued warnings, and there were 41 shipments rejected in last year alone.

According to Le Thanh Hoa, vice director of the Vietnam Sanitary and Phytosanitary Notification Authority and Enquiry Point (SPS Vietnam), most batches subject to warning failed to meet the physical, chemical or biological standards.

The EU requires compliance with the GlobalGAP (good agriculture practice) standards for all imported products, while Vietnamese utilizes a lower VietGAP standard, Hoa said.

Nguyen Tu Cuong, head of the Seafood Development Committee at the Vietnam Fisheries Association, in turn said there are a large number of complex requirements for products to enter the EU.

Vietnamese businesses will need to get up to speed on the regulations related to materials, chemical compositions and labels if they want to take full advantage of the opportunities presented by the FTA.

He advised businesses to innovate and modify their operations to improve the added value of their products.

Echoing Cuong’s sentiments, Dordi also suggested businesses in the industry pay more attention to labelling with a view to raising added value and promoting the Made-in-Vietnam brand.

According to the Ministry of Agriculture and Rural Development, Vietnam’s standards are currently lower and out of sync with those of the EU— creating a new standard consistent with that of the EU would benefit trade.

At the conclusion of the conference it was announced that officials from EU-MUTRAP will submit a draft report detailing EU SPS policies with recommendations for improvements in Vietnam’s regulations.

The EU is a trading bloc of 28 nations. Although the EU is a common market regulated by the EC, member markets have differing separate regulations requiring strict food hygiene and safety.

To gain access to these markets, fish and seafood businesses need to perform their due diligence investigations of the markets with care to insure they meet with all of the prerequisite regulations.

Previously state-owned Vinatea equitised

The State will hold zero percent stake in the Vietnam Tea Corporation (Vinatea), according to a recently-approved plan for equitising Vinatea.

The corporation's chartered capital was 370 billion VND (17.3 million USD). Its equitisation will include the sale of all State-owned capital and the issuance of corporate bonds to raise chartered capital.

Accordingly, the corporation's chartered capital will include roughly 63.74 percent of the stake owned by strategic partners, and the remaining shares stake held by investors, including Vinatea’s workers.

As scheduled, Vinatea will launch its initial public offering within three months. The starting price will be 10,000 VND per share.

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