Gucci Vietnam voiced no involvement in Hafasco’s Gucci products liquidation sale

Hanoians jostle for cheap Gucci

Gucci Vietnam Limited  (Gucci Vietnam), a wholly-owned subsidiary of Italy-based group Gucci, today announced that neither it nor any of its authorised representatives were involved in the ‘liquidation sale’ of purported Gucci products by the Hanoi Trading Service Fashion Company (Hafasco), which will be conducted in Hanoi from August 15 and 18.

The liquidation sale was reportedly the consequence of the seizure of Gucci products in 2012 by the Hanoi Market Management Bureau (MMB). On January 8, the MMB requested Gucci's representatives to ascertain the products’ authenticity.

From that time onwards, Gucci Vietnam claimed it would not hold any responsibility and/or liability for the storage and security of the products seized in 2012 by the MMB.

Gucci Vietnam also declined any responsibility and/or liability for the authenticity, origin or quality of the products, whether they relate to the 2012 MMB seizure or not, and the related services offered to the public during this liquidation sale.

In the statement, Gucci Vietnam also affirmed its commitment to Vietnamese customers by activating business operations in Vietnam in the near future in order to assure that the company’s loyal customers can buy authorised and authentic Gucci products and enjoy their satisfaction to the high level of service and quality.

Petrolimex cuts petrol price by VND600

The Viet Nam National Petroleum Group (Petrolimex) yesterday reduced the price of RON 92 gasoline by VND600 (2.8 US cents) to VND24,210 ($1.01) per litre.

The move followed a joint decision by the ministries of Industry and Trade and Finance, which asked fuel dealers to cut retail prices.

This is the third time that the retail price of petrol has been reduced this year, with a total reduction of VND1,430 per litre after five consecutive increases.

The price of diesel was cut by VND80 to VND22,090 ($1.05) per litre. The price of kerosene was also reduced by VND70 per litre to VND22,250 ($1.06), while that of mazut was reduced by VND60 to VND18,380 ($0.88) per kilogramme.

The two ministries also asked traders to stop using the stabilisation fund together with the reduction.

Local petrol wholesalers were reported to be making high profits of VND500 to VND630 per litre, depending on the fuel, as the world fuel prices have been falling.

Estimates by the Viet Nam Petroleum Association showed that as of August 14, the average basic price of the A92 gasoline in the 30-day period was US$113,38 per barrel, while in the 10-day period it was $109,57 per barrel. The domestic retail petrol price is VND24,810 ($1.18) per litre, while the basic price is VND24,473 ($1.17) per litre.

The association said the traders made a profit of VND337 per litre of petrol, plus VND300 per litre received from the price stabilisation fund. In total, the traders made a profit of VND637 per litre.

The association also estimated that Viet Nam consumes 40 million tones of petrol a day. Wholesale dealers would make profit of several billion dong a day, as per the current profit of VND637 per litre.

Under the Government's Decree 84/2009/ND-CP, traders can adjust petrol prices up to 7 per cent in line with the world prices, according to the minimum calculating period of 10 days.

Nguyen Anh Tuan, director of the Finance Ministry's Price Management Department, said management of petrol prices follows the decree to ensure benefits to all parties including the State, businesses and consumers.

Tuan said the retail prices of petrol were adjusted without considering taxes and inflation. The joint ministries of Finance and Industry and Trade would use the stabilisation fund base on the price situation in the market.

Ngo Huy Loi, director of the Tax Policies Department, said under the import-export tax regulations, the maximum tax on imported petrol was 40 per cent.

The current import tax was 18 per cent for gasoline and between 14 and 16 per cent for kerosene. The current retail price includes 32.1 per cent taxes and fees or VND8,300 per litre.

Saigon Tax Trade Center to close down

A lot of people on August 18 continued to buy discount fashion products at the Saigon Tax Trade Center before this shoping mall is shut down in September for new projects in District 1, Ho Chi Minh City.

Most clothes, shoes and jewelry stalls give 20-50 percent discounts for clearing their stocks.

The center management board said that it would be closed by the end of September to hand over the space for construction of Ben Thanh-Suoi Tien metro route and a new commercial center project.

The HCMC People’s Committee has approved a Saigon Trading Group’s project to build a 40 storey office and hotel center. Construction is expected to start by the first quarter next year to replace the Saigon Tax Trade Center.

889 FDI projects licensed

The Foreign Investment Agency (FIA), under the Ministry of Planning and Investment on August 14 organized a meeting on foreign investment in the South.

Nearly 17,000 projects have been operating nationwide as by July this year with a total registered capital of more than US$240 billion.

As of July 20, as many as 889 Foreign Direct Investment (FDI) projects, worth US$6.8 billion were licensed. A total number of 300 projects were poured an additional capital of US$2.6 billion.

The Southeast region took lead in attracting FDI, accounting for 43% of the total, followed by the Red River Delta 25%, the North Central Coast and the Central Coastal region 22% and the Mekong Delta 5%.

Japan, the Republic of Korea, Singapore and Taiwan are the largest investors in Viet Nam.

At the meeting, representatives of each locality presented advantages of each region and experience in attracting foreign investment as well as issues related to the implementation of foreign investment and production situations.

Boosting inplementation of VN-Chile FTA

The PM has recently decided to appoint Deputy Minister of Industry and Trade Tran Tuan Anh as the Chairman of the Vietnamese side in the Viet Nam-Chile Free Trade Council.

The Viet Nam-Chile Free Trade Agreement was inked in 2011 and took effect since January, 2014.

Under the deal, the two countries committed to removing tariffs for over 9,000 products in different roadmaps and granting numerous incentives in service and investment over the next three years.

The agreement also covers regulations on market access, origin, quarantine, technical barriers and defense.

The FTA set an important landmark  in the bilateral trade ties and helped strengthen economic integration strategies for Chile in Asia and Viet Nam in America.

TPP opens the door to market expansion

The Trans-Pacific Partnership (TPP) agreement is a double-edged sword that brings both challenges and opportunities to the country, said experts at a seminar in Hanoi on August 16.

Speakers explained that when the agreement comes into effect, tariffs on 90% of Vietnamese exports will be reduced to zero, which provides a tremendous opportunity for businesses to greatly expand into other TPP member nations markets.

This should especially benefit key export products such as garments, footwear, timber and agricultural products and provide weaker exports a chance to penetrate foreign markets of other TPP members.

Currently, Vietnamese garments imported into the US are subject to tariffs ranging from 17% to 32%. The rates will be slashed to zero as soon as the TPP comes into effect, leading many economists to believe that Vietnamese exports could see exponential growth.

Dr Vo Tri Thanh, Vice Director of the Central Institute for Economic Management (CIEM) in turn said the TPP negotiations are of critically important to Vietnam as the trade pact not only opens the doors for goods and services, but spills over and effects non-commercial issues as well.

Participating in the “huge” playground the TPP creates also means opening broader doors in the domestic market and allowing foreign companies greater access, which puts domestic businesses under mounting pressure to survive fierce competition.

Speakers at the seminar cautioned that even products now considered strong exports may weaken when faced with tougher competition.

For example, to enjoy the benefits of reduced tariffs, the garment sector must comply with strict requirements on certificate of origin (C/O). Materials for garment production must be imported from other TPP member countries or produced domestically.

Tariffs are not a barrier for seafood products, however, quarantine measures will most certainly be more burdensome and rigid, they added.

Dr Tran Du Lich said that increasing the competitiveness of domestic businesses is of prime importance. He suggested the State should create an institutional and business environment where businesses promote the highest innovativeness and creativeness to that end.

The 12 TPP member economies now account for nearly 40% of the world’s population, produce over 50% of global GDP, and include some of the fastest growing countries in the world. They are currently speeding up the negotiation process, hoping to sign the trade pact late this year or early next year.

At the seminar, experts encouraged domestic businesses to devise and implement proper strategies for improving their competitiveness to best grasp the opportunities from the expanded global marketplace created by the TPP and the challenges of increased competition it brings.

Australian live cattle imports explode

The number of live cattle imported into Vietnam from Australia over the past two years has increased nearly 90fold since the 2011-2012 fiscal year, according to the Meat and Livestock Australia (MLA).

The latest statistics released by the MLA show that the number of cattle shipped to Vietnam has risen from just 1,500 to a staggering 131,000 head over the past three years.

CEO of the Northern Territory Livestock Exporters Association Ben Hindle said Darwin alone exported 49,000 head of cattle to Vietnam in the reviewed period, accounting for 38% of the total.

In its annual plan announced in January 2014, MLA forecast that exports to Vietnam would see a slight decline in 2014. However, the record high figure last year made Vietnam the second largest customer of the Northern Territory’s livestock industry.

Nearly US$600 million for expressway construction

The Transport Ministry has signed a deal with a consortium of contractors to build a 77km expressway linking Thua Thien-Hue province and Danang city in central Vietnam at a total cost of nearly US$600 million).

The La Son-Tuy Loan section, part of a Ho Chi Minh Highway project – another trans-Vietnam highway, will be carried out over three years in the form of build-transfer (BT).

The Ministry of Transport’s proposal to build the expressway received an approval from the Prime Minister in May 2014.

According to plan, contractors will build a two-lane section in the first phase and upgrade it to the four-lane in the second phase.

Lam Dong Aluminum output sets new record high

Since operations began in December 2013, the Lam Dong Aluminum-Bauxite Complex Project of the Vietnam National Coal and Mineral Industries Group (Vinacomin) has exported over 411,000 tonnes of alumina products.

In the past seven months alone, the company shipped abroad a record high 251,000 tonnes of alumina products, reported an August 15 conference in the Central Highland province of Lam Dong.

The company’s export markets included Switzerland, the Republic of Korea, Singapore, Hong Kong, and China. It is currently expanding into Malaysia and Middle Eastern countries.

Meanwhile, Alumin Tan Rai Plant has produced nearly 352,000 tonnes of alumina products and 533,000 tonnes of hydroxide alumina since it began operations in November 2013.

Alumin Tan Rai Plant is projected to surpass the benchmark of 500,000 tonnes of alumina products (equivalent to its 75–78% designed capacity) by the end of this year.

ASEAN Community’s impact on EWEC cooperation in spotlight

A workshop was held in the central city of Danang on August 15 to examine the possible impact that the formation of the ASEAN Community would have on cooperation in the East-West Economic Corridor (EWEC).

At the event, which was a sidelines activity of the 2014 International EWEC Trade and Tourism Fair, participants discussed how the ASEAN Community will affect policies on tax, trade and goods of EWEC countries.

Vice Chairman of Danang People’s Committee Huynh Duc Tho said a locality at the end of the EWEC, Danang has been proactive in raising its position as well as improving infrastructure to serve the route’s economic purposes.

The city has made cooperation with other localities in the corridor to forge regional friendship and coordination.

The 2014 International EWEC Trade and Tourism Fair opened in Danang the same day.

VFF President visits Samsung Electronics Thai Nguyen

Vietnam Fatherland Front (VFF) Central Committee President Nguyen Thien Nhan on August 15 visited Samsung Electronics Vietnam Thai Nguyen (SEVT) in Thai Nguyen province to survey the company’s operations.

Nhan highlighted the achievements made by Samsung Vietnam and the group’s factory in Thai Nguyen. He affirmed that the group’s success was vivid proof of the solid strategic partnership between Vietnam and the Republic of Korea (RoK).

The investment in the construction a modern production factory with state-of-the-art machinery and equipment in Thai Nguyen along with a housing area providing social welfare programmes has contributed significantly to the improvement of workers’ living conditions.

He expressed his wish that SEVT will continue to promote its achievements and initiatives and become an exemplary model company for other foreign-invested businesses in Vietnam to emulate.

Since the factory in Thai Nguyen was put into production in March, it has produced over 6 million mobile phones with revenue reaching US$2.6 billion through and including July. The company is expected to generate US$8 billion in gross sales by the end of 2014 and some US$12 billion in 2015.

At present, the company’s revenue comprises 95% of the province’s total export turnover and it exports products to 52 nations and territories around the globe, making it Samsung Group’s second largest mobile phone factory.

The number of workers in the factory is expected to increase to 22,000 late this year from its current number of around 16,000.

Endowed with beautiful beaches and modernised seaports, the central region has many advantages to transform into a thriving and prosperous coastal urban area, said Deputy Prime Minister Nguyen Xuan Phuc.

Phuc made the remarks while addressing a central region economic forum held in Danang city on August 15, drawing the participation of many senior officials and leading economic experts nationwide.

The Deputy PM affirmed that the central region is seizing tremendous opportunities but simultaneously facing numerous challenges caused by territorial disputes at sea, including, but not limited to, China’s illegal acts in the East Sea.

Thanks to its favourable geographical location, the region enjoys convenient sea routes conducive to boosting foreign trade in the region and the world as a whole, Phuc said.

He stressed the need to improve the cohesiveness of central provinces and cities for stronger and sustainable economic growth.

Phuc’s view was echoed by Party Central Committee's Commission for Economic Affairs (CEA) Chairman Vuong Dinh Hue, who suggested fostering cooperation among localities to increase investment efficiency and create a healthier business climate in the region.

It is also essential to complete institutions for regional economy development and boost economic restructuring process in line with the shift of growth model, Hue added.

Dr. Tran Dinh Thien, Director of the Vietnam Economic Research Institute, spoke of the important role the central region play in speeding up the pace of national economic development apart from the country’s two largest economic hubs – Hanoi in the north and Ho Chi Minh City in the south.

He highlighted the central region’s enormous potential for tourism development. With its beautiful natural landscape, intimate beaches and mountains, the central region should cooperate with the Central Highlands to create a special connection between its “blue beaches” and “massive green forests”, he underlined.

Thien described central Vietnam as a rich gold mine full of miraculous treasures thanks to its seaports that enable the region to easily connect to foreign countries greatly facilitating international integration.

He also cited ocean tuna fishing following Japanese technology as another advantage for sea-borne economic development in the central region. To effectively explore sea potential, more support should be provided for local fishermen who also play an important role in protecting the national sovereignty over sea and islands, Thien noted.

Economist Tran Du Lich placed special emphasis on establishing island economic zones on Cu Lao Cham, Ly Son, Hoang Sa (Paracel) and Truong Sa (Spratly) in order to combine economic development with national defence.

The central region should focus on developing coastal urban areas in a number of tourist attractions such as Chan May, Danang, Hoi An, Can Tuong, Quy Nhon, Tuy Hoa, Nha Trang and Phan Thiet, he elaborated.

To this end, Lich said it is necessary to speed up the development of the Danang high-tech park and increase the effectiveness of key economic zones, including Chan May-Lang Co, Chu Lai, Dung Quat, Nhon Hoi, Nam Phu Yen, and Van Phong.

Sea-based tourism development is pivotal to the transformation of the central region as the spearhead economic sector, he said, adding that the region should invest heavily in developing high quality entertainment services on a par with international standards.

Most central provinces achieved an average annual GDP growth of more than 10% in the 2009-2012 period, much higher than the national average (5.96%).

In the first half of this year, the economic growth rate in nine central provinces was rather high, with Quang Nam, Khanh Hoa and Ninh Thuan taking the lead (over 11%).

In the reviewed period, Thua Thien-Hue, Quang Nam, Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa and Ninh Thuan attracted nearly US$200 million in foreign direct investment (FDI).

Cashew nuts, tea a hit at Hong Kong fair

Vietnamese tea and cashew nuts were amongst the most sought after products at the jointly staged Hong Kong International Food Exhibition and Tea Fairs, which kicked off on August 14.

Vietnamese Long An Food Processing Export JSC (LAFOOCO) reports that its cashew nuts were of interest to people of Hong Kong and foreign business owners.

Meanwhile, Tan Cuong-Hoang Binh Tea JSC in Thai Nguyen showcased a series of its finest tea products, which also garnered a great deal of attention from fairgoers.

The two events organised by the Hong Kong Trade Development Council (HKTDC) are taking place from August 14-18 with the participation of more than 1,400 businesses from dozens of regional countries and territories.

New customs system will launch soon

Viet Nam will soon start operating its national customs "single window" system, which will later be connected to those in other countries.

The mechanism, expected to be ready by the end of this year under a newly-approved plan by the National Steering Committee, is especially important as the ASEAN community grows .

The mechanism expedites the customs process, allowing importers and exporters to submit information and documents online to just one destination.

Customs agencies will make the final decision on the import, export and transit of goods and vehicles. The committee is currently organising training courses for enterprises and staff to operate the system. It will complete documents regulating the responsibility of relevant parties next month.

The General Customs Department has already launched e-customs clearance procedures and the Ministry of Industry and Trade (MoIT) created a system to grant certificates of origin online. However, these systems are not yet connected.

By the end of this year, the ministries of Health, Agriculture and Rural Development and Natural Resources and Environment will join the system. The other ministries and agencies involved in granting import and export licences will join next year.

Around 49,200 enterprises used e-customs services as of late July, accounting for 95.84 percent of the total involved in import-export activities, the Government news portal reported.

All customs departments in 34 cities and provinces provided e-customs services and 148 of 170 branches processed them. The number of import-export declarations going through e-customs procedures amounted to 5.23 million, representing 93.14 percent of the total.

Trade turnover conducted through e-customs was valued around US$239 billion, 95.3 percent of the total.

Moreover, 60.4 percent of enterprises passed customs clearance without further examination while 10.2 percent were asked to undergo additional checks.

The e-customs system runs automatically round the clock, including Saturday and Sunday.

Mekong Delta seeks to draw investment

Provinces in the Cuu Long (Mekong) Delta region would improve their competitiveness this year and the next to create a more attractive investment environment.

According to the Viet Nam Chamber of Commerce and Industry's branch in Can Tho City (VCCI Can Tho), Kien Giang, Dong Thap and Ben Tre provinces would strive to maintain a high level of competitiveness, while Tra Vinh Province and Can Tho City would aim to improve their level of competitiveness from ‘good' to ‘very good'.

VCCI Can Tho said Bac Lieu, Vinh Long, Long An, Hau Giang, An Giang, Soc Trang and Tien Giang provinces would raise their level of competitiveness from ‘mediocre' to ‘good', reported the Vietnam News Agency.

Vo Hung Dung, director of VCCI Can Tho, said that to achieve these targets by 2015, the provinces and cities would focus on training human resources.

These provinces and cities have so far attracted foreign investment of US$9.5 billion in 178 projects, he said. They would promote administrative procedures to reduce the time taken to grant investment licences and to improve the management ability of the leaders.

The region would also increase capital to VND87 trillion ($4.1 billion) for building transport systems on land, water and air to create favourable conditions for investors in production and business, he said.

The authorities of provinces and cities would implement programmes to support enterprises in improving their financial ability and management skills, getting market information and transparency in quality, treating waste products, ensuring food hygiene, building systems of trade promotion, advertising, marketing and distribution, and developing trademarks.

Nguyen Phong Quang, deputy head of the South West Steering Committee, said the Cuu Long (Mekong) Delta region had been applying investment incentives to attract foreign investment.

The incentives included 50 per cent reduction of the land use fee, and exemption from paying rent for land and water during the first 11 years after the projects become operational, and from land rent for workers' houses, trees and public construction.

The provinces and cities would also get financial support for vocational training, advertising on public media, accessing market information and consultation on investment and legal systems.

The provinces and cities exempted foreign investors from paying corporate income tax during the first two profit-making years and also halved the tax for the following three years.

Foreign investors could cite the value of land-use rights and assets on the land during the rent period as security for taking loans from Viet Nam's credit organisations, branches of foreign banks operating in Viet Nam and joint-venture banks between Viet Nam and foreign countries.

Therefore, the region had attracted VND 416 trillion ($19.6 billion) from 1,600 domestic projects and $11.8 billion from 836 foreign projects this year, Quang said.

Wood processors log continued growth

The wood processing industry is expected to earn an export turnover of US$20 billion by 2020, experts said.

Nguyen Quoc Khanh, chairman of the Handicrafts and Wood Industry Association of HCM City (Hawa), was reported as saying by the online Business Forum newspaper that Viet Nam is the sixth largest exporter of wood and wood products in the world, after the US, Italy, Germany, Poland and China.

The sector has had surprising growth. Several years ago, the industry had a yearly export turnover of just $200 million, compared with Malaysia and Indonesia which has export turnovers between $1.5 billion and 1.8 billion.

Khanh said the sector's achievements meant that the Vietnamese firms learned the ropes quickly and expanded their markets.

The industry should move toward big profits, high surplus and had many opportunities to achieve its targets, he said.

Viet Nam has more than 3,000 businesses in the sector, the majority being small-and-medium sized firms.

The companies believe that their scale should not be seen as a disadvantage as it allows them to be flexible and adaptable, instead of large firms which have higher costs.

In addition, the industry has higher productivity than garment and textile, leather shoes and seafood sectors, even though it uses fewer labourers. The annual productivity in the wood processing sector would be $18,320 per person, while those of the above-mentioned industries are $7,156; $13,943 and $8,978 respectively.

The domestic wood processing sector has been highly valued by international groups and organisations. The interior woodwork and design of two of the largest hotels in Egypt, namely Le Gray – Lebanon and Sofitel Legend Old Cataract Aswan, have been produced by Viet Nam's AA Construction and Architecture Company.

Hawa chairman Nguyen Quoc Khanh added that Viet Nam would become a production centre of interior-design products as the country's wood products are sold in 120 countries. "Vietnamese wood products attract interest in the world because they are environment friendly," he said.

The sector also sees an opportunity in meeting the market demand of the 90-million-strong domestic population and the huge 600-million-strong ASEAN population.

Khanh said that Vietnamese wood processing firms should not only aim for high productivity, but also appropriate management and machines to achieve their target.

The sector had not had the right conditions to improve the quality of its machines, which would enable it to transfer technology and support human resources training, despite having big opportunities.

Khanh suggested that the Government should consider allowing enterprises in the wood processing sector to import used machines to take advantage of cheap prices.

Pham Thi Thu Hang, general secretary of Viet Nam Chamber of Commerce and Industry (VCCI), agreed, adding that the industry should build a brand name by improving and diversifying products.

Hang said the opening of the ASEAN market would increase competition in the sector in the region.

The sector had three important advantages, namely wood products, bamboo and products for interior decoration. These should be built as brands through trade promotion, marketing, branding with modern and high-end designs and improved value-added products, she said.

She added that better value-added products would bring more export orders for the firms.

Fruit, vegetable exports grow as practices improve

Fruit and vegetable exports in the first seven months of the year were worth an estimated US$781 million, up 28.8 per cent over the same period last year, according to the Viet Nam Fruit and Vegetables Association.

They were sold to more than 50 nations and territories, with China, Japan, South Korea, and the US being the main buyers.

China continued to be the biggest market, accounting for 31.8 per cent of the exports in the first half, Nguyen Van Ky, general secretary of Vinafruit, said.

Vietnamese exporters have started to use advanced preservation methods like irradiation in recent years to satisfy demanding markets like Japan and the US, the association said.

With importing countries tending to increase their quality, hygiene, and food safety requirements, the sector has no choice but to apply Good Agricultural Practices, it said.

Viet Nam's varied geographic and climatic conditions mean it grows a diverse range of fruits and vegetables.

Global fruit demand is expected to continue rising in the coming years, giving the country an opportunity to boost exports, the association said.

Exports are expected to fetch $1.2 billion this year compared to $1.04 billion last year, it said.

The country also imported fruits and vegetables worth $313 million in the first seven months, a year-on-year increase of 41.6 per cent, the association said.

Thailand, China, Myanmar, and the US were the main suppliers, according to the Ministry of Agriculture and Rural Development. —

PetroVietnam hits 65% of yearly goal

Oil and Gas Group PetroVietnam achieved 65 per cent of its 2014 target after it earned VND434 trillion (US$20.4 billion) in profits in the first seven months of the year.

From January to July, the State-owned company produced 16.09 million tonnes of oil equivalent (TOE), which was 2.2 per cent higher than that of the same period last year. In July alone, total production volume was 2.22 million TOE.

The group produced 2.88 million tonnes of oil and petroleum in the first seven months while Dung Quat Oil Refinery Plant provided 2.68 million tonnes and Phu My Condensate contributed 200,000 tonnes.

At an online meeting of the Ministry of Industry and Trade on August 5, Nguyen Vu Truong Son, PetroVietnam Deputy General Director, said his group contributed VND96.3 trillion ($4.5 billion) to the State budget from January to July, or 1 per cent more year-on-year.

In the latter part of the year, the group aimed to promote production and business and continue its restructuring plan (including the withdrawal of capital from its non-core businesses), equitisation and adjustment of its development strategy by 2015 and towards 2035, Son said.

It would continue developing consumption markets for new products, including fibre and bio fuel, the PetroVietnam Deputy General Director added.

This year, the group plans to produce 26.63 million tonnes of crude oil and gas, of which 16.83 million tonnes will be crude oil, and 4.76 million tonnes of petroleum and oil products. The group needs VND100 trillion ($4.74 billion) in capital for these projects.

PetroVietnam is expected to gain a year-on-year increase of 6.8 per cent in its total revenue to VND673.3 trillion ($31.91 billion) for this year.

Binh Duong provides firms assistance

The southern province of Binh Duong plans to earmark VND1 trillion (US$47.6 million) to assist local companies facing financial difficulties.

Le Thanh Cung, chairman of the province People's Committee, mentioned the proposal while talking to executives of 100 companies at a recent meeting held to review the assistance given to those affected in the anti-China riots three months ago.

The package will offer subsidised loans for companies to lease and buy equipment and upgrade facilities starting in September.

Cung said the province will assist 50 percent of the investment package and also provide a 50 percent interest subsidy.

According to a report from the People's Committee, the province has provided support to companies in 11 different areas, refunded tax worth VND525 billion to 203 enterprises, and waived tax and land rentals worth VND155 billion (US$7.3 million) for 594 enterprises.

But Cung, admitting that insurance companies have been slow in assessing companies' losses in the riots and making settlements, promised to help speed things up by reporting to the government.

Mobile World revenues, profits skyrocket

Giant mobile phone retailer, The Gioi Di Dong (Mobile World) Investment Joint Stock Company has posted a first-half profit of nearly VND312 billion (US$14.8 million), nearly five times the figure a year ago.

Revenues topped VND7 trillion ($333 million), a 68 per cent rise.

The company said that product returns directly affected revenues, rising from VND21.5 billion from a year ago to VND36.4 billion this year.

Kinh Do sees financial benefits of restructuring

Confectionery producer Kinh Do Corporation has reported a net profit of VND93 billion (US$4.4 million) in the first half, 22 per cent year-on-year growth.

In its latest financial statement, the company attributed the high growth to a surge in second quarter profits to VND60 billion ($2.8 million), a 31 per cent increase.

It was the result of improved operational efficiency, cost management, and better focus on more profitable categories after its restructure.

Foodpanda gets $60m infusion to expand market

Food delivery company foodpanda and its affiliated brands hellofood and Delivery Club have received US$60 million worth of funding from a group of investors to expand operations in promising markets, including Viet Nam.

The company said the infusion of funds is from two of its existing investors, Falcon Edge Capital and Rocket Internet AG, and others it did not want to reveal.

Since being set up in 2012, foodpanda and hellofood have raised over raised over $100 million.

July automobile sales zoom to new highs

Viet Nam's demand for automobiles roared ahead in July thanks to healthy summer sales incentives, with top auto makers posting near double-digit increases over last year, an industry group reported.

Car makers sold 12,609 vehicles last month, up 35 per cent from a year earlier, with cars accounting for 7,913 units and trucks for 4,696 units, up 7 per cent and 5 per cent respectively.

The July figures lifted the seasonally adjusted annualised selling rate to 130,000 vehicles, up 18 per cent over 2013, according to data released yesterday by the Viet Nam Automobile Manufacturers' Association (VAMA).

"This is the 16th consecutive month when the industry volume has been higher than the same period last year," said VAMA's Chairman Jesus Arias.

Meanwhile, the sales in the January-July period this year rose 29 per cent from a year ago to 66,159 units, VAMA said in its monthly report. The association's data includes SUVs, passenger cars and commercial vehicles manufactured by 21 member companies.

Japanese firm Toyota beat Truong Hai to take the lead with 3,759 units sold in July, up 26 per cent over the corresponding period last year.

Local manufacturer Truong Hai, which assembles trucks, buses and sedans, had topped the rankings in May. However, the Quang Nam-based auto maker, which sold 3, 232 vehicles in July, reported a huge net profit of VND1.245 trillion (US$59 million) in the first half of this year. This is higher than last year's profit of nearly VND1.140 trillion ($54 million).

Meanwhile, Viet Nam imported 6,000 cars worth US$122 million in July, up 122 per cent in value, according to the General Office of Statistics.

With the July figures, the total number of car imports this year[P1] is 31,000 units, worth $667 million, up 59 per cent in volume and 78 per cent in value.

Viet Nam, which has a population of over 90 million, has around 2 million cars and 37 million motorcycles.

Handicraft export orders rise

Handicraft orders from China and Japan have shifted to Viet Nam, offering a good opportunity for the domestic handicraft sector to achieve its export target of US$1.6 billion in 2014.

The Viet Nam Handicraft Exporters Association (Vietcraft) General Secretary Le Ba Ngoc attributed this trend to foreign importers increasing their trust in the quality of Vietnamese handicrafts.

In recent years, many handicraft producers have focused on middle and high-end market segments, resulting in big changes in the quality of their products as well as the positioning of Vietnamese handicrafts on the world market, Ngoc said.

Vietcraft's statistics revealed that the export value of handicraft products reached nearly US$900 million over the first half of this year, up 10 per cent against the same period last year.

Besides exports to traditional markets such as the US, Japan and EU, Ngoc said, enterprises in the handicraft sector were told to exploit opportunities in the five countries in the BRICS bloc – Brazil, Russia, India, China and South Africa.

He described the bloc as a potential market for the handicraft sector thanks to the favourable geographical location. Except for Brazil and South Africa, Viet Nam has strengths for market research and transport for the bloc's three remaining countries.

In order to archive higher export turnover, Ngoc suggested that small scale enterprises strive to capture the mid-market segment in accordance with its production capacity, raw materials and skilled workers rather than the cheap segment.

Sharpening competition and expanding co-operation channels were also needed, he said.

Director of Ha Noi Industry Promotion Centre Hoang Xuan Thuy advised domestic businesses to register copyright as a move to protect their design and avoid duplication.

SOEs slash costs by $638.5 million under gov't plan

State-owned enterprises (SOEs) cut their operating costs last year by more than VND13.6 trillion (US$638.49 million).

According to People's Police newspaper, it was in a Ministry of Finance's report to the Prime Minister on the result of implementing a plan requiring SoEs to cut management costs in 2013.

The ministry's data was based on reports from eight ministries, People's Committees of five provinces and cities, 108 State-owned groups and corporations, and 7 joint stock groups and corporations in which the State holds dominant stakes.

The Government, early last year, launched a programme that required SOEs to make commitments to cut management costs and other spending on materials and energy by 5 to 10 per cent. At that time, the SOEs assured a slash in their expenses by over VND12.145 trillion ($570.18 million).

Many CEOs from these SOEs said that the activity would not only help raise production and make businesses become more efficient, but would also reduce the burden on the State budget and create more financial sources that could be invested in social welfare.

The activity was one among the Government's premier tasks to restructure the economy as well as focus on public investment, SOEs and the financial system, and to increase the efficiency and competitiveness of the economy. It was said more should be done to promote the role the State economic sector plays and SOEs must contribute to sustainable economic development.

Binh Thuan dragonfruit price tumbles

The price of dragonfruit in the central province of Binh Thuan, the country's largest dragon fruit cultivation area, has fallen significantly over the past 10 days as disease has hit some crops. The fruit is also competing with other kinds of fruit that are now in their peak harvest season.

Traders are buying dragonfruit for VND2,000-4,000 (US$0.09 - 0.19) a kilo, Pham Huu Thu, head of the province's Department of Agriculture and Rural Development's Plant Cultivation Division, said.

At this price, farmers are taking a loss of about VND2,000 a kilo, he said.

Farmer Pham Ngoc Son, who has recently harvested 100 kilos of dragon fruit with poor quality in Phan Thiet City's Tien Loi Commune, said rainfall over the past week had had caused fungi on the plants, resulting in a decline in quality.

In Ham Thuan Nam District's Ham My Commune, traders buy low-quality dragonfruit at a price of VND1,500-2,500 a kilo.

Tran Minh Tien, head of the province's Sub-department of Plant Protection, said in Ham Thuan Nam, Ham Thuan Bac and Bac Binh districts, many areas of dragonfruit have been infected with anthracnose and white-spot diseases.

These fungal diseases normally occur in the rainy season and farmers were instructed to use medicines to spray on infected plants, he said.

"But this year there were too many rains, so the spraying was not effective, causing disease outbreaks," he said.

Of 4,000ha of disease-infected dragonfruit in the province, 70 per cent of them had anthracnose disease and the rest white-spot disease, he said.

Many dragonfruit orchard owners said these diseases usually occur in orchards that do not follow global or Vietnamese Good Agriculture Practice (GAP) standards.

Binh Thuan had more than 7,000ha of dragonfruit planted under these standards last year.

The province has about 21,000ha of dragon fruit, which is 71 per cent of the total cultivation area in the country. Binh Thuan has an annual output of more than 400,000 tonnes.

Property price indices rise in major cities

Residential markets in Ha Noi and HCM City would see positive development by the end of the year due to increases in the property price index.

According to Savills Viet Nam Company Ltd, in the second quarter of this year, the Savills property price index (SPPI) for Ha Noi's residential areas was 100.3, marginally up by 0.3 percentage points quarter-on-quarter (QoQ), but down 4.4 percentage points year-on-year (YoY).

"This was a slight QoQ increase after 11 quarters of continuous fall," said Savills Viet Nam.

The inventory ratio declined sharply by 5 percentage points QoQ and 7 percentage points YoY, thanks to the strong performance of the entire market. This quarter, the absorption rate in Ha Noi was 14 per cent, up 6 percentage points QoQ with over 1,900 sold units.

The average price in the second quarter was VND24.68 million ($1,164) per square metre, almost unchanged QoQ. Projects in Hai Ba Trung and Thanh Xuan districts, with quick construction progress and many facilities, had high prices. "Speculation has also revived, indicating the possibility that the market has become more attractive not only to end-users but also investors," said Savills Viet Nam.

Meanwhile, in the same quarter, the residential index for the HCM City market was 89.6, increasing by 0.6 index points QoQ and 0.3 index points YoY.

The overall absorption rate was 16.9 per cent, up a remarkable 6.6 percentage points QoQ and 8.9 percentage points YoY. There was a significant increase in transaction volume and YoY growth with approximately 2,550 absorbed units, up 60 per cent QoQ and 115 per cent YoY, the highest transaction volume in the last three years, it said.

"During the last four quarters, the residential index has increased slightly each quarter," noted Savill Viet Nam. "A number of critical factors, including better financial support, construction commitment from developers and appropriate products targeting buyers, have resulted in higher market liquidity and price improvements."

"These positive signs of a recovering market are expected to continue to increase the QoQ index in the future," it added.

Ha Noi plans new urban areas

The capital has planned a VND20-trillion (US$940 million) project to develop urban areas along the Nhat Tan – Noi Bai axis.

This is expected to become a driving force for the development of the city's northern region.

Currently, the city is preparing to launch the project in 2015. It is expected to be completed within 10 years.

Under the project, the urban areas would cover more than 2,000 hectares along 12 kilometres of Dong Anh and Soc Son districts, which have a total population of 140,000.

The urban areas would consist of a gateway focusing on industry, trade and agriculture, an ASEAN city, a riverside urban zone, and an ecological urban area. An ASEAN cultural village and exhibition centre and a financial tower will be also constructed.

According to Chairman of the municipal People's Committee Nguyen The Thao, as the project is significant for the development of the city's strategic region, all relevant departments and agencies have been asked to work together to ensure its progress.

Prime Minister Nguyen Tan Dung has asked the Ha Noi People's Committee to develop the road from Nhat Tan Bridge to Noi Bai International Airport as a modern and model road of the city's gateway.

The 12.1-kilometre road, extending from the Nam Hong intersection to National Highway 12 and the North Thang Long-Noi Bai intersection, is expected to become operational this year, together with the Nhat Tan Bridge and Noi Bai Airport's T2 Station.

Capital seeks permission to make buildings taller

The city government has proposed that the number of storeys of old apartment buildings scheduled for renovation be increased to attract more tenants and ensure profits for investors.

The proposal comes amidst a slowdown in the renovation of degraded old apartment buildings in major cities due to the lack of consensus among investors, residents and the government.

Figures from the Ministry of Construction showed that nearly 1,690 apartment buildings, mostly located here and in HCM City, needed upgrading. In the capital city, where the problem is at its worst nationwide, only 14 of nearly 1,000 degraded apartment buildings were rebuilt after 10 years.

A massive effort is needed to meet the goal, contained in the National Government's Resolution 34 and the City Government's Decision 48, of renovating all degraded apartment buildings by 2015.

Trinh Dinh Dung, the Minister of Construction, said the renovation of degraded buildings was the shared responsibility of both the government and the residents.

Projects for the renovation of degraded old apartment buildings tend to repel investors, who fear the risk of huge financial loss.

Under Resolution 34 and the Decision 48, investors are provided with support for infrastructure investment and land use fee incentives, but from the investors' viewpoint, the risk of losing money still outweighs the opportunity to make money under this scheme.

Pham Quy Tien, Deputy Director of the Municipal Department of Finance, cited the renovation project for Nguyen Cong Tru collective zone's N3 building as an example. The project required an investment of VND503 billion (US$23.7 million), but the residents were able to raise only VND200 billion ($9.4 million).

Nguyen The Thao, Chairman of Ha Noi People's Committee, said that it would cost the city around VND1.8 trillion ($84.9 million) to develop infrastructure for the renovation of the entire Nguyen Cong Tru collective zone.

According to the master plan for the capital city, which the Prime Minister has approved, population density in the core urban area would be reduced from 1.2 million to 800,000 people per square kilometre.

This has made the renovation of degraded apartment buildings difficult, as the process must ensure that investors end up making money and residents end up with their own homes. This cannot happen if the number of storeys of these buildings remains limited.

Experts say that the most important factor for the success of renovation projects for degraded old apartment buildings is the harmonisation of benefits for residents and investors with government targets.

Thao said that an increase in the number of storeys of degraded old apartment buildings, coupled with the development of relocation areas that would attract residents, would solve the problem.

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