Cbank to assign credit growth targets by groups

Next year the State Bank of Vietnam will divide banks into four groups based on their operation effectiveness, and assign different credit growth targets to them accordingly.

The categorization is based on the classification of the bank inspectorates, according to Thoi Bao Ngan Hang (Banking Times) newspaper.

There will be four groups of credit institutions, including those with healthy operation (grade A), average operation (grade B), below-average operation (grade C), and finally, poor operation (grade D).

Banks belonging to higher grades will have higher credit growth targets.

After dividing banks into groups, the central bank will ask them to develop both quarterly and annual plans for credit growth management in 2012.

Nguyen Thi Mai Huong, deputy CEO of Ocean Bank, said the bank expects a credit growth of 15 percent in 2012, while the general target of the whole banking system is 15 to 17 percent.

“According to Ocean Bank’s self-evaluation, we sit between the bottom of grade A and the top of grade B,” Huong said.

Meanwhile, Truong Van Phuong, CEO of Eximbank, said the capital adequacy ratio (CAR) will be a key criterion for assigning the credit growth to banks in groups.

CAR is the ratio which indicates the bank's capacity to meet time liabilities and other risks such as credit and operational risk.

A banking expert said a bank will be rated as having an average healthy operation if it has a 9-percent CAR.

“Banks with a CAR of above 9 percent will be considered healthy, and poor if the rate falls below 9 percent,” he said.

However, Phuoc added that whether the credit growth targets can be met or not depends on the health of the economy.

“The credit growth target this year is below 20 percent, but it is unlikely to be achieved thanks to the exorbitant lending interest rates,” Phuoc said.

Dropping tra fish prices spark concerns

Many farmers are worried they may have to give up Tra or Pangasius farming because of the incessant price drops of unprocessed tra fish recently.

Tra fish farming remains more fragile and vulnerable than other sectors of .aquaculture How to ensure sustainable production is still a big question for tra fish farmers.

Qualified tra for export formerly sold for a record high of VND28,500-29,000 per kg but the price has dwindled by VND3,000-4,000, said Nguyen Minh Sang, a fish trader in Chau
Phu District, An Giang Province.

In particular, white-flesh tra for export now sells for VND25,000-26,000 a kg, while the price of the yellow-flesh type is down to VND24,000-24,500, or even VND21,000-22,000 in certain areas. This is similar to this May when excessive output drove prices down.

Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), attributed the steep price drop to an improvement in supply coupled with a decline in demand in some importing countries that have secured sufficient stock for Christmas and New Year holidays.

However, not long ago, Duong Ngoc Minh, vice chairman of VASEP, said unprocessed tra would be in short supply and there would be a price increase until mid-2012, probably at VND30,000 per kg.

The unexpected price fall is in stark contrast with forecasts by many experts and enterprises, and the situation may lead processing companies to unilaterally terminate the fish purchase contracts they earlier signed with farmers in the Mekong Delta at higher prices.

Nguyen Huu Nguyen, a member of the An Giang Fishery Association (AFA) and a tra fish farmer in Chau Phu District, An Giang, said: “I signed a contract to sell the fish to an enterprise in An Giang at VND26,700 per kg but this business just suspended its purchase.”

Speaking to TBKTSG, farmers expressed their concern about the slump in unprocessed fish prices and the cancellation of fish buying contracts by processing companies.

“If the price dropped further, fish farmers would plunge into a crisis similar to that in 2008,” said Nguyen of AFA.

Calculations by farmers show VND1.5-2 billion is needed for a 5,000-square-meter Pangasius farm. So with fish prices dropping, farmers will certainly rack up losses and in the next crop they will not be able to maintain their farms, said Truong Tan Buu, a fish farmer in Hong Ngu District, Dong Thap Province.

“This means our tra fish farming industry will fall into crisis due to a material fish shortage next year,” Buu said.

Nam Trieu shipyard delivers five vessels

The Nam Trieu Shipbuilding Industry Corporation (NASICO) on Wednesday handed over five ships to its domestic and foreign partners.

These vessels included a 9,200-tonne ship delivered to Hanse Capital of Germany, a 53,000-tonne cargo ship manufactured for the Hoa Ngoc Lan shipping company, and three others for the Nam Trieu shipping company.

NASICO is a subsidiary company of the Vietnam Shipbuilding Industry Group (Vinashin), which is implementing a comprehensive restructuring plan.

The handover of the ships proved the company’s efforts in overcoming difficulties and affirmed the efficiency of the Vinashin restructuring plan.

Zero import tax levied on Lao goods

The Ministry of Industry and Trade has issued a circular on 2012 import quotas, saying that goods imported from Laos will be taxed at zero percent.

Under the circular, the import rate of zero percent will be applied to commodities of Lao origin, including rice of various kinds and tobacco leaves.

In addition, imported goods should have a certificate of origin (C/O), issued by an authorized office of the Laos People’s Democratic Republic and customs procedures cleared at border gates.

At the same time, Vietnamese entrepreneurs are allowed to import rice and paddy products under import quotas. For importers of tobaccos leaves, they must have a license granted with quotas by the MoIT.

The circular will take effect as of January 1, 2012.

Jetstar offers mobile payment

Jetstar Pacific Airlines has agreed to let passengers pay fares on mobile phones, in a deal with online payment service OnePay, mobile phone carrier Vinaphone and M-Service.

The new service enables frequent travelers to book and pay for plane tickets anywhere from mobile phones on the Vinaphone network. Payment is automated by calling 19001550 or at www.jetstar.com after receiving ticket codes through the MoMo-Mobile Money service, part of the M-Service mobile phone application.

This new service makes Jetstar Pacific the first airline in the country to accept mobile payment in addition to online, credit card and face-to-face transactions.

Sufficient goods supply for Tet

There will be no significant goods shortages or escalating prices through the holiday season, especially the upcoming Lunar New Year festival (Tet).

Many businesses in HCM City have stockpiled Tet goods with the amount increasing by 10-15 percent against last year. As planned, food and foodstuff businesses alone are expected to meet 30-40 percent of the city’s consumer demand.

Pham Thanh Hung, deputy director of Ba Huan Co, Ltd says that his company releases up to 2 million eggs per day to the local market.

Nguyen Ngoc An, deputy director of Vissan Company, says that the company’s meat reserves have increased by 10-15 percent, excluding frozen meat, while processed food has risen 15 percent.

According to the Livestock Husbandry Department under the Ministry of Agriculture and Rural Development (MARD), husbandry product supply has recently increased by 8-10 percent in terms of quantity. Currently, the price of pork hovers around VND58,000 per kilo and might rise to VND60,000-62,000 per kilo during Tet.

In 2011, Vietnam imported 107,000 tonnes of meat, up 30.5 percent compared to the previous year.

A representative from Co.op Mart supermarket chain said that HCM City has 22 Co.op Mart supermarkets and 26 Co.op Mart food stores which have participated in the city’s price stabilization programme. In addition, other provinces and cities have been assigned to stabilize prices for Co.op Mart branches in their localities.

However, many businesses are worried that there will be a scarcity of dried and seafood products. In HCM City, the price of seafood has increased by VND1,000-25,000 per kilo, up 4.5 percent. Dried shrimps in various sizes rose by VND50,000-100,000 per kilo (8-23 percent).

A representative from LotteMart says that 80 percent of cookies and beverages are locally made, with prices up 10-25 percent compared to the same period last year. Meanwhile, the prices of soft drinks increased by 2-25 percent, depending on the type, wine up 3 -20 percent and beer up 10 percent.

Huynh Huu Tuan, a manager from Citimart Binh Thanh, predicts that purchasing power will not be higher and there will not be major fluctuations in prices during Tet. However, in many markets in HCM City, confectionaries imported from China are displayed in huge volumes.

Garment surplus hits $6.5b

The textile and garment sector posted an export surplus of US$6.5 billion in 2011, $1.5 billion higher than last year's figure, according to the Viet Nam Textile and Apparel Association (Vitas).

The surplus has brought the industry's localisation ratio – the percentage of materials used by textile and garment companies that are produced locally – to 48 per cent.

In spite of high inflation, the country's garment exports to key markets experienced significant growth, such as Japan (52 per cent), the EU (41 per cent) and the US (14 per cent).

Le Tien Truong, Vitas' vice chairman, attributed growth in the sector to well-conducted market forecasts, efficient investment and production and growing efforts by exporters to win the trust of international partners.

However, experts suggested the industry should reduce dependence on imports.

Greater production of raw materials in the future would help the industry meet major export contracts and reduce business risks due to fluctuations in raw material prices in the world market, they said.

It should also gradually evolve from contract manufactures to original design manufacturers (ODM) to increase value and win more FOB (Free on Board) orders from foreign clients, they said.

By the year-end, ODM contracts earned the sector just $800 million, accounting for 5 per cent of its total export turnover, Vitas said, adding that the industry aimed to raise the ratio to 15 per cent in 2015 and 20 per cent in 2020.

Despite hidden challenges globally, the sector has targeted a $15 billion export turnover in 2012, a surge of 12 per cent against last year's figure.

SCIC plans to divest $10m from TTP

The State Capital Investment Corporation (SCIC) plans to sell 4 million shares in Tan Tien Plastic Packaging Co (TTP), equivalent to 27.3 per cent of the company's charter capital, through negotiation.

It has set a face value of VND52,000 (US$2.48) a share, which nearly doubles its current price of just VND25,000 ($1.19).

Besides SCIC, TTP's other major stakeholders include Le Minh Cuong (chairman and CEO, 11.2 per cent), FTIF-Templeton Frontier Markets Fund (7.4 per cent) and SSI Vision Fund (5 per cent).

Steelmaker to issue 31m shares

Steelmaker Hoa Phat Group (HPG) will issue 31 million shares to pay for the 2010's second phase dividend at the rate of 10 per cent.

The issue is expected to take place in the first quarter of next year and will be extracted from the company's undistributed net profit. After the release, HPG's charter capital will increase from the current VND3.18 trillion (US$151.4 million) to VND3.49 trillion ($166.3 million).

By the end of November, the group posted a total revenue of VND16.56 trillion ($788.6 million) and a total net profit of VND1.25 trillion ($59.6 million), completing 95 per cent of its earnings target and 67 per cent of its profit goal for the year.

PVS profit exceeds yearly target

PetroVietnam Technical Services Corporation (PVS) estimates its net profit this year will reach VND1.25 trillion (US$59.5 million), a year-on-year increase of 10 per cent, exceeding its yearly target by nearly 36 per cent.

The company's total revenue is also projected to surpass its yearly goal by 31 per cent, totalling VND27.5 trillion ($1.3 billion).

Boom in footwear, leather exports
 
Exports of leather products and footwear were expected to reach US$8.5 billion next year, up nearly 9 per cent over 2011, according to the Viet Nam Leather and Footwear Association (Lefaso), which predicted that leather handbag exporters in particular would see growth of about 15 per cent.

Lefaso vice chairman Diep Thanh Kiet said that over half of major leather and footwear firms had already landed export contracts for the first quarter and 25 per cent of the firms had contracts for the second quarter.

The US was forecast to be the largest import market for Vietnamese handbags and footwear since the Trans-Pacific Partnership (TPP) takes effect next year. Under the TPP agreement, Vietnamese products will enjoy a tariff reduction to below the level imposed on similar Chinese products.

However, industry insiders were also concerned about a reduction in exports to one of the industry's leading import markets, the EU, due to the bloc's debt crisis. Exporters have already reported a decline of roughly 20-30 per cent in export contracts to that market.

Moreover, the EU continues to supervise Vietnamese footwear products due to anti-dumping litigation, which will cause Vietnamese product to be less competitive than those of Indonesia, India, Bangladesh and Sri Lanka, which will benefits from preferential tariffs.

On the domestic market, Lefaso forecast little significant change next year as local consumer demand would remain at about 75 million pairs of shoes and 25 million handbags.

PetroVietnam output exceeds target by 30%
 
The Viet Nam National Oil and Gas Group (PetroVietnam) produced 15 million tones of crude oil this year, 30 per cent higher than production targets set earlier this year.

The group exceeded the target despite lower output from some oil fields, which was compensated by technical innovations, which raised the extraction ratio up to 52 per cent.

In second half of the year, PetroVietnam has also begun tapping into two new oil fields and has increased oil production abroad.

Higher production has also helped the group realise its financial plan for the whole year, with total revenue of VND672 trillion (US$32 billion), of which VND170 trillion ($2.8 billion) went into the State budget.

These figures indicate the group's income will account for half of the country's total income.

In terms of payment to the State, the group will constitute around 70 per cent of corporate and group contributions.

PetroVietnam General Director Do Van Hau said the Government had assigned the group to produce 15.8 million tonnes of oil and 9 billion cu.m of gas in 2012.

Unions, co-ops to sell low-cost goods

More outlets for price-stabilised goods in residential areas, traditional markets, industrial parks (IP) and export processing zones (EPZ) as well as in outlying districts in HCM City will be opened to serve low-income workers.

The Saigon Union of Trading Cooperatives (Saigon Co.op), Saigon Trading Group (SATRA Group), the HCM City Chapter of Ho Chi Minh Communist Youth Union and the HCM City Women's Union yesterday signed a co-operation agreement to develop outlets for price-stabilised goods.

Speaking at the signing ceremony, Nguyen Thi Hong, deputy chairwoman of the city's People's Committee, said that the number of supermarkets, commercial centres and food convenience stores in outlying districts and in IPs and EPZs was still limited.

The cooperation between enterprises and unions would help explore existing spaces and infrastructure in residential areas to expand retail outlets for price-subsidised goods and increase access to price-subsidised goods for residents in remote areas.

Under the agreement, members of the unions who had shops in traditional markets or street-front shops and had enough financial capacity would be helped to open retail stores for price-subsidised goods, said Le Ngoc Dao, deputy director of the city's Department of Industry and Trade.

The enterprises will assist participants to set up stalls and offer them essential equipment and training in management skills, enabling them to supply goods at preferential prices.

The HCM City Women's Union has so far encouraged 300 members to participate in the programme, she said.

The Youth Union has cooperated with Saigon Co.op to manage five food convenience stores in IPs and EPZs, she added.

To date, the city has nearly 4,300 stores under the price-stabilised programme, which sell products that are at least 10 per cent lower than market prices.

Petrol tariff rises from zero to 4%

The Ministry of Finance on Wednesday decided to hike import tariffs on petrol products from the current zero per cent to 4 per cent to ensure the interests of the State, enterprises and consumers.

Deputy Minister Vu Thi Mai said to ensure the stability of domestic retail prices for petrol products, the Government had cut import taxes to zero per cent, and had kept it unchanged over the last 11 months.

Speaking about the Finance Ministry's import tariff increase decision, the director of the Price Management Department Nguyen Tien Thoa said the current prices of petrol and oil were not based on all of the factors needed for making a basic price.

All import tariffs of diesel oil, mazut oil and petrol are much lower than the Government's current tax regulation of 10 per cent. In particular, import taxes of mazut and diesel are 5 per cent, while petrol import tariff after being raised remained at only 4 per cent, according to Thoa.

The import price of petrol end-products from the Singaporean market, which is Viet Nam's main fuel exporter, still stood at a stable and low level during the last time.

This means that petrol importers had made significant profits from their business, he told Tuoi Tre newspaper.

The prices of petrol products imported into Viet Nam on December 22 and 23 were US$113 per barrel. Earlier, petrol prices at all transactions in Singapore were about $108 or $109 per barrel. On average, the price of import petrol from December 16 has been $110 per barrel.

In addition, petrol traders have been receiving financial assistance from the petrol price stabilisation fund, which is VND550 per litre.

Meanwhile, the domestic retail price for petrol was VND20,400 ($0.97) per litre. This means that petrol traders can generate a profit of about VND700 per litre, including the fixed profit of VND300 a litre, as stipulated by the Ministry of Finance on the wholesalers'prime cost calculation.

According to Petrolimex, the company had gained a profit of VND800 on every litre of A92 gasoline they sold from December 1 to December 15 when the price of petrol imported from Singapore was $111.06 per barrel.

In November, the company also reaped VND1,000 a litre for gasoline.

According to market watchdogs, the finance ministry's recent changes on the petrol-pricing policies were still only aimed at protecting the interests of the State and enterprises but not consumers.

This was shown when the ministry continued to delay the cut of retail prices for petrol to help consumers ease price pressures.

A source from the Finance Ministry said the agency was preparing to make some adjustments on current regulations related to oil and gas price calculations, such as the formula for prime costs, fixed business expenses and price stabilisation funds.

Delta farms thrive despite disasters, diseases

Natural disasters and disease outbreaks have made agricultural production difficult this year, but provinces in the Cuu Long (Mekong) Delta have still managed to achieve high economic targets.

Le Minh Hoan, chairman of the Dong Thap Province People's Committee, said that the province's paddy output this year would reach a record high of 3.1 million tonnes.

Export revenues from the export of tra fish have also increased significantly, reaching nearly US$400 million, about $80 million more than the province's target, Hoan said.

This year, Dong Thap has achieved a growth rate of 13.55 per cent, 0.55 per cent higher than the annual target, he said.

Kien Giang Province topped the country in paddy output this year, harvesting 3.92 million tonnes, up 420,000 tonnes against last year.

Tran Quang Cui, deputy director of the Kien Giang Department of Agriculture and Rural Development, said the province has expanded the area under the autumn-winter rice crop by 40,000ha this year.

Paddy yield has also increased by 0.3 tonnes per hectare against last year due to proper investment in improved cultivation techniques and agricultural inputs, he said.

Kien Giang's aquaculture and fisheries output topped 529,000 tonnes this year, a year-on-year increase of 7.7 per cent.

The province is estimated to earn export revenues of nearly US$632 million from produce this year, up 34 per cent against last year.

In Ca Mau Province, seafood processors faced a shortage of shrimp for processing this year, but seafood export revenues still reached a high $910 million.

However, the world economy was still in turmoil and the export of farm produce in particular would face several hurdles in 2012, experts said.

Duong Tien Dung, deputy chairman of the Ca Mau Province People's Committee, said next year the province would increase the area under industrial shrimp farming by 1,700 ha to 5,000 ha.

However, Ca Mau now faced several difficulties, including a weak irrigation system which cannot meet the demand for developing industrial shrimp farming, Dung said.

Power supply was still inadequate, he said.

Shrimp farmers and enterprises were facing a shortage of loans for production, he said, calling for the central government's support in addressing these problems.

Ben Tre Province, meanwhile, plans to carry out several measures to promote agriculture production and stabilise the lives of residents.

The Ben Tre Province People's Committee has asked district-level People's Committees, departments and sectors to provide preferential loans for farmers and enterprises to increase production.

The An Giang Province People's Committee has also targeted an economic growth rate of 12.5 per cent next year and an average per capita income of more than VND33.8 million a year.

To meet these targets, An Giang will continue promoting its agriculture advantages, especially producing high-quality rice under the large-scale farm model that it experimented successfully this year.

Think big to get ahead

Firms are mulling plans to enlarge business scales in 2012.

According to a recent survey of Vietnam Chamber of Commerce and Industry (VCCI), 32 per cent of firms expected to expand business in 2012.

Specifically, Doji Gold and Gems Group are eager to embark on new plans in 2012 after getting a big chunk of money from selling a 95 per cent stake in sanitary napkin maker Diana Joint Stock Company to Japan’s Unicharm Group.

“This is a huge and significant amount of money in current tough business climate,” said Doji’s general director Nguyen Minh Phu.

Phu added: “With our current capacity, we are willing to jump into new areas, even in property due to low investment costs against multiple opportunities.”

In the same move, Vinatex Danang is also making plans after Japan’s Apron Company revealed its intention to enlarge the labour protective clothing manufacture contract with Vinatex Danang. The first contract was inked in August, 2011 and yielded upbeat business figures.

“Once the agreement is approved, 6,000 square metre Danang workshop will be expanded. Apron Company will also provide technical experts and pay for employees working there,” said Vinatex Danang’s administrative head Ho Viet Thanh.

Reality shows that after restructuring enterprises saw noticeable improvements in performance leading to scores of firms think of enlarging scale in 2012 irrespective of unsatisfactory forecasts for 2012’s first quarter.

Also according to VCCI’s recent survey, 65 per cent of surveyed firms saw quality improvements after restructuring while 57 per cent of firms enjoyed higher productivity. The survey also showed that 57 per cent of firms believed in stable conditions for doing business in early 2012.

Vietnam to further integrate into global economy next year

Local firms will need to further integrate into the world economy as the nation will conclude talks on a number of new trade agreements next year, said economic expert Pham Chi Lan.

Lan said three important agreements on which Vietnam would complete negotiations were Trans-Pacific Partnership (TPP), and free trade agreements (FTA) with South Korea and the European Union.

TPP negotiations might be finished next year as the member economies want to end them soon and help other countries such Japan and Mexico join the TPP, she said. “Ten years after the signing of a bilateral trade agreement (BTA) with Vietnam, the top concern of the U.S. regarding its relationship with Vietnam is the TPP.”

Although South Korea already has an FTA with ASEAN, it will be better if Vietnam has a bilateral deal with this country. A pre-feasibility study for the bilateral agreement was finished last month, saying that a bilateral FTA would bring more benefits to both countries.

There are some countries wanting to launch FTA talks with Vietnam such as Russia and Belarus and four other countries in the northern and central regions of Europe.

As FTA is a new development trend, requirements of partners such as trade liberalization and policy improvement will be higher, putting more pressure on Vietnam, Lan said.

“Global integration is like riding a bicycle. You cannot stand still but have to cycle; otherwise, you will fall down,” she said.
 
Meat import up over 30% this year

Vietnam has imported some 107,000 tons of meat this year, a year-on-year rise of 30.5%, the Livestock Farming Department said in a recent conference on livestock farming.

This figure went beyond expectations of the Ministry of Agriculture and Rural Development. Hoang Kim Giao, head of the department told the Daily that the earlier estimated meat import volume for this year was less than last year, at 83,000 tons.

Such a high import volume has resulted from pork price hikes in June and July, which led traders to import large quantities of meat to meet local demand, said Nguyen Thanh Son, the department’s deputy head.

When pork prices stayed high in July, a spat over whether to import pork or not emerged. The Ministry of Industry and Trade wanted more pork import to stabilize the domestic market while the agriculture ministry argued the local supply was sufficient.

The Livestock Farming Department will neither issue import quotas nor restrict meat imports but will let the market regulate supply and demand, said Son. “Meat import depends on the market’s demand. We will only assign some companies to import meat when local prices turn strongly volatile.”

A large volume of hens imported from China is not included in the total meat import volume.

Son said previously, hens that are 72 weeks old were sold to Vietnam for meat but their meat was too tough, so local firms switched to importing 64-week-old hens and sell them to food stores in the northern region.
 
VietinBank raises capital by nearly VND3.4 trillion

Vietnam Commercial Bank for Industry and Trade, or VietinBank, has finished the second chartered capital increase this year to VND20.23 trillion from the previous VND16.86 trillion by issuing more shares to its existing shareholders.

VietinBank in a report on Wednesday sent to the Government, the central bank and the Ministry of Finance said that it had issued over 337 million shares with the nominal value of VND10,000 each. Newly-issued shares are distributed to the bank’s present shareholders at a ratio of 1:5 with total mobilized fund reaching some VND3.37 trillion.

In the second share issuance this year, VietinBank has sold 576,435 shares that remained unsold from the previous issue.

The capital increase this time includes about VND2.7 trillion paid by state-owned shareholders. Of which, VND200 billion is collected from recovering the bank’s nonperforming loans while over VND273.5 billion comes from the bank’s equitization and VND1.823 trillion from dividends paid for its state-owned shareholders last year.

Given the charted capital increase, the number of shares held by state-owned shareholders is 1.624 billion shares worth over VND16.245 trillion, accounting for 80.31% of the bank’s total shares. Meanwhile, the remaining 19.69% goes to other private shareholders.
 
Russia considers Vietnam ties top priority in Asia

Russia places on high priority the development of relations with Vietnam, especially in trade, said the Russian ambassador to Vietnam at a press conference in Hanoi on Wednesday.

Andrey G. Kovtun told reporters during the regular year-end meeting that opportunities were opening up to boost trade ties between the two countries now that the country’s access to the World Trade Organization (WTO) is nearing. Furthermore, there is the high possibility of concluding the Free Trade Agreement (FTA) among the tariff union including Russia, Belarus, Kazakhstan and Vietnam, which will further increase the trade between the two countries, Andrey added.

The year 2011 is an important year in terms of implementing trade agreements signed by the two parties in the previous year. However, the results have not been relevant to the trading potential between the two countries, said the Russian envoy.

Data from the General Department of Vietnam Customs show Vietnam’s exports to Russia between January and November rose by some 60% year-on-year to US$1.18 billion, with major commodities being telephones, garment and textile, and aquatic products. However, Russian exports to Vietnam tumbled one-third to only US$612 million, comprising mainly oil and gas, steel, fertilizer, and machinery.

But the ambassador still pinned high hopes on the thriving trade in the coming time, especially once the FTA was concluded. So far, the two parties have conducted three rounds of talks regarding the FTA.

“In the future, Russia is planning to develop such a partnership model with the whole of ASEAN,” said Andrey.

The diplomat also recalled the strategic partnership between Russia and Vietnam established from 2001 when the then President V.V.Putin paid his first visit to Vietnam. This visit as well as other high-ranking visits in the following years has created the foundation for the trading development between the two countries.

“To Russia, developing relationship with Vietnam is still a top priority of Russia’s policy on foreign affairs in Asia in the future,” Andrey noted.