Vinausteel protests unfair land lease fee

Vinausteel, the joint venture between Vietnam Industry Investment Corporation from Australia and Vietnam Steel Corporation, proposed related governmental agencies to cancel the collection of additional land lease fees charged since 2003 to ensure its legal rights and avoid unnecessary complaints.

After receiving the investment certificate to build a steel rolling mill in Hong Bang district, Haiphong city from the Haiphong People’s Committee, Vinausteel was allowed to rent a land area of 55,767 square metres for 30 years from June 28, 1994 in accordance with Decision No.224/QD-DC. The annual land rental fee was $1.8 per square metre, which was then adjusted to $1.35 per sq.m.

However, this adjusted price is still higher than the leasing price applied to other enterprises at similar locations. In accordance with the Vietnamese Land Law 2003 and Article 9 of Decree No.142/ND-CP, effective from December 12, 2006, Vinausteel has the right to receive a much lower rental price equal to only 0.5 per cent of the land value. Specifically, Vinausteel’s current lease charge is 5-9 times as much as the fees paid by other enterprises renting similar locations.

Vinausteel requested related agencies to adjust its land lease fee to be compatible with Decree 142, but the agencies have yet to issue a response.

Furthermore, Vinausteel’s land lease fee rises by 15 per cent every five years, as stipulated in Notice No.277/TB/CCT of the Hong Bang Department of Tax. The land lease fee stipulated by the Haiphong People’s Committee in 2005 was VND21,500 ($0.9) per sq.m, which, after the latest adjustment after 15 years of operation, has been increased to VND45,600 ($2) per sq.m. Vinausteel said that this was wholly unfair and should be revised.

Thus, not only was Vinausteel applied a high land lease fee of $1.35 per sq.m, but it was also charged an additional $230,147 due to the adjusted price after 15 years of operation.

According to Vinausteel, this additional payment is not compatible with Decree No.46/2014/ND-CP on the collection of land and water surface rent. This decree does not explicitly cover collecting land lease fees from 15 years ago, especially when the enterprise is asking for a reduction of land lease payments.

Vinausteel complains that it has suffered a loss of tens of billions of VND due to this unreasonable fee. It submitted a document to the Government Office to consider the issue and direct the Ministry of Fiannce, the General Department of Taxation, the Haiphong People’s Committee, and other related agencies to eliminate the additional charge of $230,147 to maintain a fair business environment and ensure the legal rights of enterprises in Vietnam.

Uber reduces fare gap in Ho Chi Minh City

Uber Vietnam’s representative said that its taxi brand UberX will raise fares in Ho Chi Minh City from August 24, closing up with traditional taxi fares.

In particular, UberX’s fare will increase from VND7,000 ($0.3) per kilometre to VND8,500 ($0.37) per kilometre in Ho Chi Minh City. Fare based on time stays unchanged at VND450 ($0.02) per minute, while the minimum fare and cancelation fee will still be VND15,000 ($0.66).

Earlier, in November 2016, Uber has already raised prices once. Then the minimum fare increased from VND5,000 ($0.22) to VND15,000 ($0.66), and the kilometre charge increased from VND5,000 ($0.22) to VND7,000 ($0.3). Uber drivers still have to pay a 25 per cent commission to the company.

Besides, Uber has a strategy of raising fares based on actual traffic flows to support drivers. In rush hours or during heavy rain, the minimum fare can be 1.3 times as much as the usual. By raising minimum fares, UberX fares may exceed traditional cabs.

Through these two bouts of raising prices, Uber fares are getting closer to traditional taxis. According to the statistics of Ho Chi Minh City Taxi Association, the minimum price of Vinasun’s 5-8-seater passenger cabs is VND11,000-12,000 ($0.48-0.53) and charges VND14,000-16,000 ($0.62-0.7) per kilometre for the first 30 kilometres, after which the charge is VND11,200-VND14,200 ($0.49-062). This price is similar to other taxi brands in Ho Chi Minh City, such as Mai Linh or Savico Taxi. Some less popular taxi brands even offer slightly lower prices.

Uber’s new price may make people wonder about the future policy of its biggest rival GrabTaxi, and whether Uber will be overtaken by both GrabTaxi and traditional taxis due to its new price policy.

Previously, there were concerns that traditional taxi companies, especially Vinasun and Mai Linh Group, are losing the competition with Grab and Uber due to the dizzying rise in the number of Grab and Uber cabs.

According to newswire Vneconomy, in recent years, the number of Uber and Grab taxis has exceeded the figure set by Ho Chi Minh City’s taxi planning. Notably, Uber and Grab’s fleets have reached a total of 21,000 cabs, while Ho Chi Minh City’s taxi demand is 11,000-12,000 only.

Many traditional taxies lead by Vinasun insisted on pressing litigation against Grab and Uber for unfair completion. This campaign has been gradually gaining momentum as other Vietnamese taxi companies from Hanoi and Ho Chi Minh City join.

At present, Uber’s rivals have not released any statement on this new policy. However, it is forecasted that the fierce battles among taxi brands in Vietnam may not stop easily in the coming period. 

Southern lottery companies bow down to Vietlott

Giving in to the dominance of Vietnam Lottery Company (Vietlott), traditional lottery companies in Ha Nam and Thua Thien-Hue provinces decided to co-operate with Vietlott instead of seeking a confrontation.

Nguyen Thanh Dam, deputy general director of Vietlott, told Vnexpress that they have signed contracts with lottery companies in Ha Nam and Thua Thien-Hue provinces. Accordingly, along with traditional lottery business, these companies will become Vietlott’s agents to take the bonus.

According to rumours, Capital Lottery Company also intends to co-operate with Vietlott to improve its business results.

Capital Lottery Company lost its shine since Vietlott’s Mega 6/45 has appeared. The company also launched a computerised lottery to compete with Vietlott, but failed because Vietlott has been offering much higher jackpot prizes.

Besides, the company also saw a decrease in profit. Notably, in 2016, Capital Lottery earned VND728 billion ($32.04 million) in revenue, however its profit was only over VND3 billion ($132,045), equalling a quarter of 2014. In 2017, the company expected to earn VND3.6 billion ($158,454) in profit only.

In its report related to its development strategy by 2020, Capital Lottery set the target to prevent decrease in revenue and profit.

In the race to gain market share, traditional lottery companies in the South were forced to raise their maximum prize to VND2 billion ($88,260) since January 1 from the previous VND1.5 billion ($66,195) in an effort to compete with Vietlott.

In early December, Vietlott officially expanded to Hanoi with 150 agents, hoping to replicate its success of the past few months in the south.

In January 2016, Vietlott signed an exclusive 18-year contract with Malaysian conglomerate Berjaya to launch computerised lottery games.

The Mega 6/45 is the company's first foray into the market. Players select six numbers from 1 to 45 and win a jackpot that starts at VND12 billion ($538,000) by matching all six numbers from the draw. Each ticket costs VND10,000 ($0.40).

The prize will keep growing until there is a winner. The odds of winning have been estimated at around one to 8.14 million, lower than the odds of being struck by lightning.

In 2016, Vietlott reported a revenue of VND1.6 trillion ($70.6 million). This is the highest annual revenue since the company’s establishment in 2011.

CII sells stake to quench capital thirst

Ho Chi Minh City Infrastructure Investment JSC (CII) will sell a large volume of shares to cover its capital demand to develop numerous large-scale projects, according to newswire CafeLand.

Notably, CII will sell 123.12 million shares at the price of VND15,000 ($0.66) for its existing shareholders. CII expected to divest at least 50 per cent worth VND923.4 billion ($40.6 million) via the sale.

After the sale, CII plans to sell 17.71 million individual shares to South Korean Rhinos Asset Management Co., Ltd. (RAM) at the price of VND26,040 ($1.16) apiece.

After these sales, CII’s chartered capital is expected to reach VND4.2 trillion ($184.7 million).

RAM was also a partner in a previous deal. Earlier in November 2016, CII signed a deal to sell a convertible bond volume worth $40 million to KEB Hana Banktrustee and Custodian Business. Under the contract, CII would issue 400 non-guaranteed convertible bonds at the price of $100,000 per unit and an annual yield of 1 per cent for five years.

CII is entitled to redeem bonds from the third year after the sale, but the buyback amount cannot exceed 50 per cent of the total bond volume. Accordingly, RAM is allowed to convert at most 50 per cent of the bonds into shares with a conversion price of VND38,500 ($1.71) per share or resell the bond volume at the initial price to CII and enjoy a yield of 4.5 per cent a year.

CII has a portfolio of strategic infrastructure assets, including water treatment plants. The water company also holds a stake in Thu Duc Water BOO Corp., a water treatment company now 49 per cent owned by Manila Water.

In addition to water infrastructure, CII holds several toll road concessions, such as the 15.7-kilometre expansion of Hanoi Highway, which connects Ho Chi Minh City with southern industrial hub Bien Hoa.

In July, CII signed a memorandum of understanding with Hong Kong Land to jointly develop luxurious high-end apartments on a prime land site that local authorities agreed to give to the company as it conducted the build-transfer (BT) infrastructure project in Ho Chi Minh City's Thu Thiem area.

The joint venture will develop luxury residences, promising to set a new quality standard for Vietnam. The projects will consist of approximately 965 units including luxury apartments, airy villas, and garden apartments enjoying the scenic views of the Saigon River and the surrounding green areas.

These projects will also offer apartment units designed in a variety of sizes ranging from one to four bedrooms, with amenities such as swimming pools, public green areas, and boutique supermarkets to ensure a lush and comfortable living environment.

CapitaLand wades deeper into Vietnamese commercial real estate

To capitalise on the increasing interest of foreign real estate investors in Southeast Asia in general and Vietnam in particular, CapitaLand Limited has set up its first commercial fund in Vietnam named CapitaLand Vietnam Commercial Fund I (CVCFI) with a capital of $300 million.

The fund, which will have a life span of eight years, will be used to invest in Grade A commercial real estate in Vietnam. CapitaLand will hold a 40 per cent stake in CVCFI, while the remaining interest will be held by major institutional investors, the company announced on its website.

Lim Ming Yan, president cum CEO of CapitaLand Limited, said, “We see increasing investor interest in Southeast Asia, particularly in Vietnam. CapitaLand is positive about the growth trajectory of Vietnam and foresees that this trend will continue for at least the next ten years. Besides the growing demand for residential properties with urbanisation, we also see strong potential upside in the commercial real estate sector, given the mismatch between the supply and demand of quality office space.”

“CVCFI brings us a step closer to our goal of raising funds with $7.34 billion in total assets under management by 2020. It comes on the back of our largest private equity partnership, the $1.5-billion Raffles City China Investment Partners III, which invests in prime integrated developments in gateway cities in China,” Lim added.

CapitaLand has been considering Vietnam its focus in recent years, and in January this year, CapitaLand made its first foray into commercial real estate through the acquisition and development of an international Grade A office tower in the central business district of Ho Chi Minh City which will feature a direct connection to an upcoming metro station. With the completion of this development in 2020, CapitaLand plans to continue to diversify their portfolio and strengthen their foothold in the country.

Vietnam is the third largest market for CapitaLand in Southeast Asia, after Singapore and Malaysia.  CapitaLand has nine residential developments, 22 serviced residences with over 4,700 units, and one international Grade A office development across six cities in Vietnam.

Tech Expo 2017 held in HCMC

VietnamWorks, together with TopITworks, both members of the Navigos Group, organized the largest technology career fair - Tech Expo 2017 - in Ho Chi Minh City on August 29.

With the theme “Tomorrow Land”, Tech Expo 2017 saw the participation of 37 sponsoring employers and more than 1,500 jobseekers in the IT sector. Every recruitment booth received between 100 and 200 CVs.

Compared to last year, Tech Expo 2017 was much more dynamic, with candidates being proactive in job seeking rather than just looking around. Many employers scanned profiles and arranged interviews with potential employees.

The KMS Company, one of the leading outsourcing companies in Vietnam, had more than ten recruitment staff at the expo, who received CVs and described job requirements. “Our company often misses its recruitment targets at all levels, as there is a shortage of qualified candidates,” said Ms. Phuong Le, Recruitment Manager at KMS. “Many jobseekers don’t meet our requirements in terms of professional skills, and we must give them two months of training. Young employees are still short of career orientation and engagement, which creates challenges in hiring at KMS.”

KMS has tried to shorten its interview process to two rounds and hoped to recruit potential candidates at the expo who meet its requirements and have the abilities needed to join the company as soon as possible.

There were also representatives from various Japanese companies in attendance, including those seeking candidates in Vietnam and recruitment service companies looking for candidates to work in Japan. “Due to the scarcity of Japanese speakers, we have targeted English speakers as well,” said Mr. Yoshiki Matsubara, Chief Sales Officer at Igs Asia. “Candidates will be trained in the Japanese language. Those possessing Japanese language skills will receive a salary 5 per cent higher than others. For candidates who want to work in Japan, besides specialized knowledge, they must also improve their global mindset and teamwork ability, and be passionate about studying Japanese culture.”

“How to secure a $5,000 IT Job” was the topic of a panel discussion at the expo and received much attention. Ms. Nguyen Phuong Mai, Managing Director at Navigos Search, discussed the obstacles that impact IT employees’ salaries. “IT candidates often demand benefits before contributing to the company, and this attitude leads to concerns about paying high salaries,” she said. “In addition to specialized knowledge and skills, employers also pay attention to a candidate’s attitude. Building a personal image is of overriding importance, since employers can check a candidate’s behavior, even on social platforms. Therefore, it’s important to show your personal image consistently, in reality and on online channels. Candidates must contribute to the company before demanding more benefits.”

According to Navigos Search, one recruitment process for a senior position paying $7,000 involved 15 interview rounds, included specialized knowledge, skills, personal testing, and IQ tests.

International visitors hit record in August

The latest figures from the General Statistics Office reveal that international visitors to Vietnam in August reached a record high of 1.2 million, an 18.5 per cent increase against July and up 35.1 per cent against August last year.

The reason international visitor numbers are rising dramatically is the tourism industry and travel companies adopting many measures and effectively organizing cultural and tourism activities.

Visa-free policies for citizens from the UK, France, Germany, Spain, and Italy have also been a key factor.

International visitors are estimated at 8.5 million in the first eight months of this year, up 29.7 per cent year-on-year.

Visitors from Asia totaled 6.3 million, up 34.8 per cent year-on-year. Chinese tourists numbered 2.6 million, up 51.4 per cent, South Koreans 1.5 million, up 49.3 per cent, and Japanese 518,000, up 7.4 per cent.

Those from Europe were estimated at 1.2 million, up 20.4 per cent year-on-year.

Visitors from the Americas, meanwhile, reached 565,200, up 10.8 per cent, of which those from the US reached 424,000, up 9.8 per cent.

Tourists from Australia and Africa also increased sharply over the same period in 2016.

Vietnam has great tourism potential but the country needs appropriate policies to create breakthroughs to develop it into a spearhead economic sector and affirm the country’s position on the global tourism map, experts told a conference held last month in preparation for the upcoming Vietnam Private Sector Forum (VPSF).

The experts indicated that Vietnam spent $2 million on promoting tourism, which was modest compared with other countries in the region.

According to Mr. Hoang Nhan Chinh, General Secretary of VPSF’s Tourism Working Group, visa policies should aim at creating favorable conditions for foreign tourists and visa exemptions should be extended to a duration of 30 days.

Exemptions should also be granted to tourists from Australia, Canada, the Netherlands, New Zealand, Belgium, and Switzerland, who spend on average $1,200 each, he said.

Higher prices push up cashew nut export revenue

Vietnam exported 188,034 tons of cashew nuts worth $1.85 billion in the first seven months of this year, down 1 per cent in volume year-on-year but up over 25 per cent in revenue.

The cashew nut export price rose 27 per cent over the same period of 2016, reaching $9,842 a ton.

Cashew nut exports to the US were worth $679.67 million, accounting for 36.7 per cent of the total and increasing 37.7 per cent year-on-year. The US is Vietnam’s largest cashew nut export market.

Following was the Netherlands, accounting for 15.6 per cent of the total, reaching $288.02 million, up 44 per cent over the same period last year.

China accounted for 11.7 per cent, standing at $215.92 million, an increase of 11.5 per cent.

Rising revenue was seen in other markets: Belgium, up 95 per cent to nearly $12 million, Russia, up nearly 66 per cent to $30 million, and India, up 40 per cent to $22 million.

Exports to Pakistan and Greece, meanwhile, fell sharply, by 54 per cent and 53 per cent, respectively, in revenue.

Vietnam’s total trade as at mid-August reached about $250 billion. Exports stood at about $124 billion and imports $126.4 billion, up about 19 per cent and 22.3 per cent, respectively, year-on-year, for a trade deficit of $2.4 billion.

New Managing Director for Bosch Vietnam

Bosch, a leading global supplier of technology and services, officially announced on August 28 the appointment Mr. Guru Mallikarjuna as the new Managing Director of Bosch Vietnam.

Mr. Mallikarjuna replaces Mr. Vo Quang Hue.

Bringing with him over 12 years of experience at Bosch, Mr. Mallikarjuna will continue to develop new business opportunities and increase the company’s market presence in all business lines in the country.

“Bosch has maintained an excellent track record in Vietnam in the past decade and become one of the key growth markets of Bosch in Southeast Asia,” the new Managing Director said. “We attribute our robust growth to the strong partnerships we have forged with our customers over the years. It is an honor for me to build on the achievements of my predecessor, who led the company through ten years of remarkable success.”

In addition to his new appointment, Mr. Mallikarjuna will also head Robert Bosch Engineering and Business Solutions Vietnam as Managing Director, a role he has held since 2013.

In his four years leading the Bosch software and engineering R&D center in Vietnam, he built a dynamic corporate culture nurturing diversity and innovation. The center employs more than 1,400 associates in Ho Chi Minh City.  

Bosch in Vietnam has developed from a representative office in Ho Chi Minh City in 1994 to become one of the largest European investors, with more than 3,100 associates in total, which subsequently increases its activities in the four fields of R&D, Manufacturing, Sales, and Services.

Banks to provide $1.15bn in credit for HCMC PPP projects

Investors and banks signed a memoranda of understanding (MoU) on August 24 in Ho Chi Minh City to provide credit to eight PPP projects with total investment of around VND26 trillion ($1.15 billion).

The signing ceremony took place at a meeting between investors and banks, including Vietcombank, BIDV, Vietinbank, Agribank, SCB, TPBank, and OCB,  to implement seven major projects in the city during the 2016-2020 period that will include building the North-South axis road, Nguyen Tat Thanh Road, and Tan Phu Hospital.

Mr. Pham Manh Thang, Deputy General Director of Vietcombank, told the signing ceremony that with limited State budget funds available, public-private partnerships (PPP) are needed for the development of infrastructure and public services.

The Ho Chi Minh City Department of Planning and Investment estimates the city needs around VND850 trillion ($37.7 billion) for the seven major programs. The city’s budget, however, can only cover 20 per cent of required capital.

Mr. Nguyen Thanh Long, Chairman of the Ho Chi Minh City People’s Committee, was quoted as saying that the city is coping with serious challenges in environmental pollution, traffic congestion, flood control, immigration, and climate change. “These problems have directly affected local growth and competitiveness,” he said. “The seven key programs will generate new momentum for the city to develop and address public concerns.”

The seven programs were approved at the city’s 10th Party Congress and include human resources improvements, administrative reform, a more competitive business climate, easing traffic congestion, responding to climate change, cutting pollution, and urban refurbishment and development.

Sixty per cent of the capital will be mobilized for transport infrastructure, the environment, and flooding issues.

Local authorities will work to attract potential investors, with strategies including administrative procedures reform to facilitate investors in accessing opportunities.

According to the Department, there are 23 PPP projects in the city that have completed contracts with total investment capital of over VND71 trillion ($3.2 billion). The city is continuing to implement 130 other projects with total investment of over VND395 trillion ($17.9 billion).

As at July 31, Ho Chi Minh City had 7,065 foreign investment projects with total registered capital of over $42 billion.

Franklin Group & Apax Holdings to offer American high school education

The Franklin Group and the Apax Holdings Joint Stock Company (JSC) under Egroup have worked together to launch American high school education in Vietnam through the Apax Franklin Academy system.

The two signed a memorandum of understanding (MoU) in Hanoi on August 23.

The Apax Franklin Academy will become the first academic system in Vietnam to offer high school education and college-preparatory in accordance with the Blended Learning model - a combination of online teaching and direct support at academic institutions in Vietnam.

The study cost is about 70 per cent of the cost of studying abroad. The Apax Franklin Academy also offers English language study programs, career guidance, and college preparation in the US and other countries, such as the ESL program, English Language Proficiency (ELE), and SAT / ACT / GED certification.

Apax Holdings will also provide opportunities to study in the US right after high school, through short-term cultural exchanges, overseas studies, and scholarships in the US.

Mr. Nguyen Ngoc Thuy, Chairman of Egroup and Apax Holdings, said there are now more opportunities to learn from new sources of knowledge and technology is the foundation for developing an effective learning method consistent with the trend towards globalization.

“With the development of the Franklin system, we expect the curriculum will prepare students for the best possible course of study in the US and Europe,” he said.

Mr. David Hooser, Founder and Chairman of the Franklin Group, said it has had experience in the US since 2009 and he visited Vietnam to inspect education institutions before selecting Apax Holdings as a partner. “We want to create opportunities for students in Vietnam to approach modern education,” he said.

Apax Holdings is an investment company in the field of education and training and is listed on the Icom Stock Exchange. In the third quarter, its shares will be transferred from UPCoM to HSX.

It will launch the five-star Apax English center within a year and will continue to invest in the iGarten Education JSC, which offers bilingual kindergarten studies applying the STEAM teaching method.

It will also cooperate with Egroup to build and finalize the Education Park project, a business training academy that has achieved success in South Korea over the last 30 years.

Impact investment manager to support women-led SMEs

SEAF, a global impact investment manager headquartered in Washington D.C., recently announced the launch of the SEAF Women’s Opportunity Fund (SWOF) for Southeast Asia.

The Fund will seek opportunities to make equity and structured debt investments in small-and-medium-size enterprises (SMEs) led by women in Vietnam, the Philippines, and Indonesia.

SWOF targets transaction sizes of generally between $500,000 and $2 million in growth-oriented companies. As an impact investment fund, it also looks for businesses that have positive social and environmental impacts in addition to financial returns.

“SMEs owned by women account for 25 per cent of the total number in Vietnam and typically focus on services; a ‘greener’ sector of the economy” noted Ms. Dinh Thu Trang, SWOF’s Investment Director in Vietnam.

A 2016 study on SMEs in Vietnam owned by women showed that one of their major disadvantages compared to those managed by men is that it is generally more difficult to access sources of funding as well as markets, due to cultural factors and social obstacles. This is a gap in the capital market but also an opportunity for an impact investment fund like SWOF.

“The Fund’s establishment, together with other sources of funding that prioritize female entrepreneurs, will contribute to economic growth as well as increasing women’s standing and narrowing the gender gap,” Ms. Trang added.

SWOF is managed by SEAF and will comply with SEAF’s global environmental, social, and governance standards. Businesses funded by SWOF will also benefit from post-investment support, particularly in the areas of financial management and corporate governance.

SEAF is an investment management group that provides growth capital and business assistance to SMEs in emerging and transition markets underserved by traditional sources of capital.

Headquartered in Washington D.C., through its network of over 30 offices around the world it invests in entrepreneurs to build successful businesses and hopes to realize both attractive returns for its investors and a measurable development impact on local communities.

Toong & International Enterprise Singapore sign partnership

Vietnamese co-working space operator Toong and International Enterprise Singapore (IE Singapore), the government agency that promotes international trade and partners Singaporean companies in going global, recently announced a new strategic partnership assisting Singaporean companies to enter Vietnam market through its network of co-working spaces and supporting eco-systems.

The agreement is part of IE Singapore’s Plug and Play Network across China, India, and Southeast Asia, which aims at easing market entry for SMEs in over 45 major cities in six key markets.

The partnership will promote cooperation in providing quick and easy market access to Singaporean companies in Vietnam, with Toong providing the necessary ecosystem and resources, including co-location working spaces, a vast market network, and support and training resources to facilitate the growth and expansion of companies in Vietnam.

This is line with IE Singapore’s role in partnering Singaporean companies to expand and invest overseas. Singaporean companies have shown increased interest in Vietnam over the years, and Singapore is now the third-largest foreign investor in Vietnam and its leading investor among ASEAN countries.

Toong will provide business consultation, legal, financial and other advisory services, and facilitate introductions and business matching meetings with local partners. Both Toong and IE Singapore will also organize relevant events and training to share Vietnam’s business landscape and opportunities with Singapore companies.

“This partnership essentially cements Toong as a gateway for Singaporean enterprises looking to expand into Vietnam,” said Mr. Phu Nguyen, Chief Strategy Officer at Toong. “Specifically, Toong will provide office solutions for Singaporean companies and offer specific assistance on potential business connections, and advise them on company registration processes as well as the local business landscape.”

Toong is the first large-scale professional co-working space chain in Vietnam, providing innovative working environment services for SMEs and established enterprises in multiple industries around the country.

After more than two years in operation, the company has five locations, in Hanoi, Da Nang, and Ho Chi Minh City.

Toong quickly received funding after its first site opened in August 2015, from Openasia and its latest investor, Indochina Capital (ICC). It is also the only strategic partner of CapitaLand in developing co-working spaces in Vietnam.

VAMC seizes collateral of Sai Gon One Tower

The Sai Gon M&C complex has been seized due to its owners accruing bad debts of $308 million.

The Vietnam Asset Management Company (VAMC) said it had seized collateral from the Sai Gon One Tower Joint Stock Company (JSC), the complex owner, at 34 Ton Duc Thang Street, District 1, in Ho Chi Minh City on August 21, for the purpose of debt recovery in accordance with the law.

VAMC previously signed a debt purchase contract with a number of credit institutions for the debts of a group of customers, including the Sai Gon One Tower Joint Stock Company (formerly known as the Saigon M&C Real Estate Joint Stock Company), the Lien Phat Investment Joint Stock Company, the Minh Quan Investment and Construction Consultant Joint Stock Company, and the Tan Superdeck M&C Joint Stock Company, with total outstanding debts (principal and interest) at that time of more than VND7 trillion ($308 million).

“Although VAMC has repeatedly urged the group of customers to meet their repayment obligations, they have not done so nor adopted a viable repayment plan,” a representative from VAMC said.

VAMC asked the Sai Gon One Tower Joint Stock Company to hand over collateral to fulfill its obligations, but this was never done. It therefore moved to seize collateral. The process was conducted in accordance with Article 7, Resolution No. 42 from the National Assembly on addressing non-performing loans (NPLs).

The Sai Gon M&C complex has a total area of 6,672 sq m with total investment of $256 million. The Sai Gon One Tower Joint Stock Company was established in 2004.

Digiworld moves into healthcare products

The Digiworld Corporation (DGW) has officially announced its entry into the local healthcare industry with the debut of its first product, Kingsmen, a supplement for men exclusively distributed by the company.

Along with developing its distribution network, Digiworld has set a revenue target for the product line of more than $3.5 million this year, $17.6 million next year, and $44 million in 2019.

Kingsmen is produced by Medistar Vietnam and Digiworld has been directly involved in all steps in its development, including market research and consumer needs and behavior research, and consulted on product and business development strategies as well as multimedia strategies.

Digiworld hopes to diversify its portfolio with this initial investment in the local healthcare retail market. A second product will be introduced later this year.

“Big pharmaceutical enterprises are now both product manufacturers and distributors, while small companies, who produce and distribute on a small scale, don’t have the capacity to expand nationwide,” said Mr. Doan Hong Viet, Chairman and CEO of Digiworld. “This is a niche market full of attraction. Digiworld’s strategy is to choose quality products that have not been fully explored. The healthcare product market is in need of a moderator, a distribution channel that is broad enough for the brand to become popular among local people.”

According to a report released in January by Roland Berger’s, a global strategy consultancy, market expansion services (MES) in Asia have been witnessing strong growth, especially in Southeast Asia. Expected growth from 2016 to 2021 is 8.5 per cent, in which the healthcare industry is growing due to increasing quality of life and people’s rising interest in health, and governments have invested more in the healthcare system at the same time. The report found that predicted growth in MES for the healthcare sector in Vietnam from 2016 to 2021 is 11.1 per cent.

In addition to the potential of MES, Mr. Viet said that the healthcare industry, especially the health protection and functional food sector in Vietnam, is now one of the most promising. It is a highly-fragmented industry, with an expected annual growth rate of about 10.31 per cent in the over-the-counter (OTC) product range from 2015 to 2020, according to Business Monitor International.

Kingsmen is a line of specialized healthcare products for men with pure and natural herbal extracts. It has a special associated formula that is packaged in a modern production line and controlled for finished product quality in accordance with ISO international standards. It helps balance metabolic activities, promote hormones, prevent aging, and promote overall well-being.

Digiworld’s primary business line is electronic product distribution. Its distribution network of 6,000 outlets nationwide and logistics and after sales services help brands penetrate and develop in the market.

Seamless payments to be showcased in HCMC

SmartCard Marketing Systems Inc. has announced the launch of its Fintech ISV Channel partnership in Vietnam at the Intercontinental in Ho Chi Minh City on September 6 and 7.

“Seamless” is a key meeting place in the brave new world of commerce. It is a new event built on 20 years of experience; a seamless continuity from Asia’s largest and longest-running conference focused on cards and payments to a dynamic summit and large-scale exhibition bringing together the converging worlds of e-commerce, retail, and payments.

The events’ host, Terrapin, brings together a great platform to introduce banks, telecoms, retail, and global enterprises to SmartCard Marketing Systems, to build client and partner relationships.

“We enjoy the platform offered to network and engage in their seamless payment events,” said Terrapin’s CEO Massimo Barone. “Vietnam offers a great opportunity to bring our portfolio of products, including our ISV partner portfolio, to showcase to banks, financial institutions, and retailers. We have positioned the company at several of their events to introduce the products and solutions to grow the Fintech ISV accelerator offering with significant success.”

Terrapin has been sparking ideas, innovations, and relationships that transform business for over 30 years. Using their global footprint, Terrapin brings innovators, disrupters, and change agents together, discussing and demonstrating the technology, strategies, and personalities that are changing the way the world does business.

The company’s focus is to develop Issuing & Acquiring relationships with banks in the region, further expanding the company’s footprint in Asia. In addition, it is expanding its China Cross-Border RMB partnership with Axepay Inc. and VeritasPay Philippines, offering a unique global solution for processing and foreign exchange settlements by country.

SmartCard Marketing Systems Inc. is a FinTech advisory company and solutions provider to the payments industry, delivering cloud-based EMV Host Acquiring & Issuing solutions to banks, telecoms, and other enterprises. The company’s in-house lab also offers customers proprietary software solutions, including Genorocity.com, a coupon and incentive platform for the Retail & Events industry, Check21SAAS.com, a Remote Deposit Check solution for X9 clearing, and Mtickets.event, an events and Mticketing platform for the Events Industry.

HSBC Vietnam named Best Foreign Bank in Vietnam

In recognition of its exceptional performance in Vietnam’s banking sector, HSBC Vietnam was named Best Foreign Bank in Vietnam at the prestigious FinanceAsia Country Awards, the eleventh time in 12 years it has won the coveted prize and the second time in three years it has topped the Best Foreign Investment Bank in Vietnam category.

Over the last year, the bank, once again, stood out for its strong financial performance overall, achieving a sharp increase in pre-tax profit and customer loans thanks to strong revenue growth and very low loan impairment charges and careful control over costs.

Against a challenging and volatile market and in spite of stiff competition from both newly-arrived banks and increasingly competitive existing banks, HSBC managed to maintain strong capital and liquidity positions.

“It’s a tremendous feeling to once again win both of these highly-prized awards from one of the leading publications in the financial industry, FinanceAsia,” said HSBC Vietnam’s CEO Mr. Pham Hong Hai. “This recognition underscores the success of our growth strategy in this challenging but exciting market.”

Mr. Hai added that HSBC Vietnam has leveraged its global network to capture business opportunities from robust foreign direct investment (FDI) inflows, resilient manufacturing, and a growing affluent segment.

The award for Best Foreign Investment Bank is also a milestone for HSBC Vietnam and one that proves it can offer clients comprehensive financial solutions besides commercial banking capabilities. “To be acknowledged in this way is a remarkable tribute to the headway we have made in broadening our business and bringing the full spectrum of investment banking, commercial banking, and market solutions to our clients in Vietnam,” Mr. Hai said. “Business with clients from South Korea, China, Hong Kong and Thailand has grown substantially in recent years and HSBC Vietnam has also supported several large State-owned and private companies to expand internationally.”

Leveraging HSBC’s global network and on-the ground insights from local market experts, HSBC Vietnam is able to provide relevant and up-to-date market intelligence tailored to nearly every major industry sector necessary to help deliver the client’s M&A ambitions, whichever direction they choose.

FinanceAsia noted that HSBC Vietnam ranked first in the merger and acquisition (M&A) league tables from 2012 to 2016 with a combined value of completed and announced deals of $3.8 billion, by advising landmark cross-border M&As and helping Vietnamese companies obtain foreign equity and expertise.

It served as joint book-runner, arranger, billing, and delivery bank on major deals in Vietnam and also as sell-side advisor for France’s Casino Group in their divestment from the Big C retail group; the largest ever retail transaction in Vietnam’s history. In the last few years, HSBC Vietnam has also advised on five of the ten largest M&A deals in Vietnam, demonstrating its strength in advising on complex, cross-border transactions relating to Vietnam.

On the loan financing side, HSBC also made the country’s largest-ever domestic currency transaction, a $180 million equivalent, three-and-a-half-year club deal for a telecoms company. “Receiving these two awards fills us with pride and highlights the resilience we have shown in challenging times,” said Mr. Hai. “More than anything, these accolades also further encourage us to work even harder and further raise the bar for banking and investment in Vietnam.”

Shinhan Bank signs MoU with Momo E-Wallet

Shinhan Bank Vietnam announced on August 21 that it has signed a Memorandum of Understanding (MoU) for a cooperative arrangement with the Online Mobile Service Joint Stock Company (M_Service), the owner of MoMo e-wallet.

Prior to signing the MoU, Shinhan Bank and M_Service signed a contract linking the bank’s customer account numbers with MoMo e-wallet, which expires at the end of September.

“One of Shinhan’s 2017 strategies is to globalize digital banking, and with MoMo e-wallet, we believe our strategy will be successfully implemented,” said Mr. Shin Dong Min, CEO of Shinhan Bank Vietnam.

The MoU is necessary to strengthen the relationship between Shinhan Bank and M_Service to develop financial services with digital applications in Vietnam.

The cooperative deal will also open up a new development direction in attracting customers to use Shinhan’s modern and convenient digital banking services. At the same time, existing and prospective customers of MoMo e-wallet will also be offered new banking services from one of the strongest foreign banks in Vietnam.

MoMo e-wallet is a smartphone app with over 3 million users, providing customers with a One Touch Payment experience and more than 200 convenient services, including money transfer, mobile top-up, bill payments, pay-as-you-go, and mobile commerce.

It owns a network of more than 4,000 transaction offices in 45 cities and provinces in Vietnam, allowing more than 2 million customers in remote areas - where banking and smartphone services are still not so popular - to gain access to modern financial services.

Vinalines, Belgium’s Rent-A-Port N.V ink cooperation deal

The Vietnam National Shipping Lines (Vinalines) and Belgian Rent-A-Port N.V signed a Memorandum of Understanding (MoU) on August 30 on the possibility to cooperate in grain specialised port, processing zone and logistics system projects in Lach Huyen port and Dinh Vu industrial zone, in Hai Phong city.

Rent-A-Port is an engineering and investment company, specialised in the development of marine infrastructures and industrial zones worldwide. It offers services ranging from consultancy and full project management to co-investment in marine related projects and industrial zones.

Under the MoU, the two companies will seek collaboration opportunities in a joint venture company to develop grain handling port in Hai Phong International Gateway Port. They are also keen on another joint venture firm to construct a 250 hectare logistic centre opposite the grain port, facilitating grain loading, storage, processing and distributing.

Along with joining the construction of a 630-metre port in Dinh Vu industrial park, which is currently invested by Vinalines Dinh Vu JSC, the Belgian enterprise can buy 10 percent of Vinalines’s charter capital when the company becomes privatised in April, 2018.

Thus, Rent-A-Port N.V will attach its long-term benefits to Vinalines as well as support the Vietnamese company in advanced technology transfer, human resources training, financial capacity improvement, business management, service supply and market development.

With adorable port infrastructure and logistic system coupled with considerable management experience and financial capacity, collaboration between the two enterprises is expected to enhance competitiveness and maintain crucial roles of both sides in marine port and logistic sectors in Vietnam.

Vinalines is a leading marine business in Vietnam, especially in port and marine services in Hai Phong city. The firm will make an initial public offering (IPO) in December this year. Under the IPO plan, the State will hold 65 percent of the company’s registered capital of 12.3 trillion VND (541.2 million USD) while it will sell 35 percent to domestic and foreign businesses.

Vinalines is also allowed to hold 65 percent of registered capital at key ports, including Hai Phong, Sai Gon and Da Nang. 

Vinalines currently manages a fleet of off-shore vessels with total capacity of nearly two million tonnes, occupying some 25 percent of the national fleet’s capacity. It has contributed capital to 14 sea port businesses, which have a total length of more than 13,000 metres, 30 percent of the total length of ports nationwide. They include a number of deep-water harbours that can receive 190,000 tonne vessels.

Vegetable exports in August hit nearly 300 million USD

Vegetable exports in August reached 296 million USD, bringing total revenue in the first eight months of this year to 2.32 billion USD, a rise of 46.5 percent compared to the same period last year.

China, Japan, the US and the Republic of Korea were the leading markets for Vietnamese vegetables, consuming 85 percent of the exports. 

High growth was also seen in other markets, including Japan with 61.7 percent, the United Arab Emirates, 61.4 percent; China, 61.3 percent; and Russia, 49.4 percent.

Vietnam also imported 169 million USD worth of vegetables, bringing the total figure in the first eight months to 1.02 billion USD, up 93.7 percent year on year.

According to the Ministry of Agriculture and Rural Development, in August, the domestic fruit market fluctuated greatly due to changes in markets and heavy rains.-VNA

Derivatives trading: Individual investors must pay 0.1% tax

Individual investors that participate in derivatives trading market have to pay a 0.1 per cent income tax for derivatives trading transactions.

The tax is imposed on the trading prices of derivatives transactions, which could be sell and buy orders and expiry of the futures contracts.

A similar tax rate has also been imposed on foreign institutional investors, while domestic institutional investors have to pay tax in accordance with Việt Nam’s corporate income tax regulations.

The tax rate is regulated under Document 11133/BTC-CST, issued by the Ministryof Finance on August 21, on taxing investors’ income from trading derivatives futures contracts.

Taxation on investors’ income from derivatives trading transactions began on August 10, the day the derivatives market begins operation.

Number of new firms increases by 16%

More than 85,350 firms were established in the first eight months of this year with total registered capital of VNĐ822 trillion (US$36 billion), statistics of the Business Registration Department under the Ministry of Planning and Investment showed.

These figures represented a rise of 16.3 per cent in the number of new firms and an increase of 44.8 per cent in registered capital over the same period last year.

Notably, average capital for a business rose 24.5 per cent over the same period last year to reach VNĐ9.6 billion.

The department said the foundation of new businesses increased in most sectors, especially real estate (up by 65.8 per cent); finance, banking and insurance (up by 33.4 per cent); education and training (up by 30 per cent); and healthcare (up by 29.6 per cent).

The only sector witnessing a decline in the number of new firms was transport and warehousing.

More than 19,150 firms resumed operation in the eight-month period, increasing slightly by 2.4 per cent over the same period last year.

However, 45,770 firms temporarily halted operation in the period, a rise of 13.3 per cent. More than 7,750 firms completed dissolving procedures, 92 per cent of which had registered capital of below VNĐ10 billion each.

VNA/VNS/VOV/SGT/SGGP/TT/TN/Dantri/VNEVET