return icon Vietnamnet.vn

BUSINESS IN BRIEF 2/2

HCM City banks urged to slash bad debt; New FDI approvals surge 67% in January; Vietnam companies dragged down by old technology; Banks speed up lending ahead of Tet; ANZ: Vietnam consumer confidence drops slightly

HCM City banks urged to slash bad debt

The State Bank of Vietnam has called on banks in HCMC to do all they can to bring down bad debt to below 3% and achieve credit growth of 13% this year.

To Duy Lam, director of the central bank in HCMC, discussed those targets at a meeting on plans for the banking sector this year in the city on January 26. Lam attributed the high bad debt ratio last year to new regulations on debt classification and risk provision in line with international practices.

Bad debt of the banking system in HCMC rose to 5.31% last year from 4.69% in the previous year.

Nguyen Van Dung, head of the HCMC Banking Supervision and Inspection Agency, told the meeting that total bad debt at banks in the city had amounted to around VND56.7 trillion (US$2.7 billion) as of December 31 last year, up over VND12 trillion compared to the beginning of the year. Of the total figure, some VND3.368 trillion was from an agricultural bank and more than VND10 trillion from two branches of a joint-stock commercial bank.

HCMC vice chairwoman Nguyen Thi Hong said a strong spike in bad debt resulted from the Mac Thi Buoi branch of Agribank and Vietnam Construction Bank.

Nguyen Dong Tien, deputy governor of the central bank, said the bad debt ratio of over 5% was still manageable as the percentage at major credit institutions was slightly over 1%, meaning the ratio at small banks was much higher.

Tien said more than half of the 200 bank branches in HCMC have high bad debt.

He acknowledged that the bad debt target of below 3% is hard to obtain and that this would require banks to closely coordinate with the central bank to solve problems related to collateral and debt collection.

Hong said the city government will work with the central bank over the settlement of bad debts at banks in the city.

Banks in HCMC posted credit growth of 12.1% last year.

HCM City’s FDI approvals off to good start

New foreign direct investment (FDI) approvals have amounted to nearly US$364 million in the first month of the year, a strong increase against the same period last year, according to the city’s Department of Planning and Investment.

Speaking at a review meeting on the city’s socio-economic performance in January last week, the department’s director Thai Van Re said the FDI picture in the first month is good with foreign investors registering nearly US$330 million for 23 new projects, up 15 times in capital and 53.3% in project number.

Re said investors have got approval to add a total of US$34 million to eight operational FDI projects in the period, raising the total amount of capital registered for both fresh and operational projects to nearly US$364 million.

Re said the capital pledged by domestic enterprises for new and operational projects this month has picked up 33.2% year-on-year. Meanwhile, the number of business closures has declined by 10% against a year ago, suggesting that the city’s manufacturing sector has improved well at the beginning of the new year.

HCMC chairman Le Hoang Quan told the meeting that the city government will continue creating favorable conditions and incentives to attract more investments this year.

Quan said FDI approvals in the city reached US$3.25 billion last year and are expected to climb to US$3.5 billion this year.

Quan pointed out positive signs from the hi-tech sector and that more FDI is flowing into four key fields: engineering, electronics-information technology, chemical-pharmaceutical-rubber, and food processing.

Regarding budget revenues, HCMC Department of Finance director Dao Thi Huong Lan said the city has collected VND26.8 trillion this month, up nearly 29% year-on-year. Of which, the amount paid by enterprises of different economic sectors is up nearly 32% year-on-year to VND13.35 trillion, and exports and imports have contributed VND7.6 trillion, increasing 48%.

New FDI approvals surge 67% in January

Fresh foreign direct investment (FDI) approvals nationwide in the first month of the year are projected at US$663 million, up a whopping 67.1% against the same period last year.

The Foreign Investment Agency (FIA) under the Ministry of Planning and Investment said 44 new FDI projects had been licensed as of January 20 with total registered capital of over US$392 million, jumping 85.5% year-on-year. Besides, 19 operational projects have got approval to add US$271.26 million to their pledged capital in the period, up 45.8%.

The strong increase in new FDI capital is a good sign for the year.

Last year, FDI approvals stood at US$20.23 billion, 19% higher than the target of US$17 billion, but fell 6.5% against 2013.

With the good start this month, analysts projected that fresh FDI approvals in 2015 could be higher than last year.

According to FIA, foreign investors have registered in 11 fields this month, with processing-manufacturing attracting the most capital, US$605.7 million, 91.3% of the total, in 18 fresh and operational projects.

Wholesale, retail and repair come in second with US$30.79 million (4.6%) while the power and water distribution stands third with US$10.44 million.

Foreign investors have disbursed some US$505 million this month, a year-on-year rise of 8.6%.

Regarding exports, the FDI sector has posted US$8.49 billion in January, including crude oil, rising 8.2% year-on-year and accounting for 66.8% of the nation’s total. If crude oil is not taken into account, the sector’s exports total US$8.2 billion, up 0.9%.

FDI enterprises have spent US$7.8 billion on imports this month, up 41.4%, leaving a trade surplus of US$690 million.

Companies from 15 countries and territories have had their projects approved in Vietnam this month. British Virgin Islands takes the lead with fresh and additional capital pledges of US$331.32 million (49.9%), followed by South Korea with US$110.25 million (16.6%) and Hong Kong US$105.5 million (15.9%).

The big projects licensed this month are Worldon Vietnam Co. Ltd. worth US$300 million, Regina Miracle International Vietnam Co. Ltd. with investment adjusted up to US$90 million and Taekwang MTC Vietnam having investment of US$43.2 million, according to FIA.

Serviced apartment rents hard to rise this year - brokerages

Property service provider CBRE Vietnam projected in its recent report that rents for serviced apartments in HCMC would rise this year but brokerages have cast doubt on this possibility.

CBRE Vietnam explained that the supply of serviced apartments in the city was limited last year while demand showed some sign of recovery. This is why the company forecast rents could increase 10-20%.

The company said in its review report on the fourth quarter of last year that customers’ budgets for leasing houses improved in the period. The requests for serviced apartments at a monthly rent of under US$1,000 fell but those for US$2,000-4,000 grew. Some customers were willing to pay more than US$6,000 per month for a rented home.

The monthly rents of serviced apartments in HCMC are US$25-32 per square meter, a slight rise over the third quarter of last year.

However, according to brokerages, the investors of serviced apartments do not have plans to adjust up rents as occupancy is about 80%.

A representative of a property service provider told the Daily that investors will have a sound reason to raise rents if the percentage is higher, so rents may not edge up at least in the first half of this year.

As observed by the Daily, the monthly rent of less than US$1,000 for apartments in the city is sought after by customers.

Mai Xuan Phu of Bloomhouse Real Estate Company specializing in serviced apartments said 98% of his customers are foreigners working in Vietnam.

Meanwhile, the sales manager of a property brokerage in HCMC’s District 1 said the majority of his customers choose serviced apartments from US$1,500-2,000 per month, while those with fewer customers ask for apartments with monthly rent of US$2,000-3,000.

More investors have spent on the projects of serviced apartments with monthly rents at around US$500 in Phu Nhuan, Tan Binh and Binh Thanh districts to attract cost-conscious customers.

According to CBRE Vietnam, the common leasing contracts for serviced apartments are signed for periods of six months to one year.

The Q4 report of Cushman & Wakefield Vietnam showed more foreigners prefer small serviced apartments for short and medium leasing periods as companies have stopped providing or reduced housing rent for their employees due to economic woes.

The company estimated HCMC now has 30 projects with nearly 3,000 serviced apartments and 44% of them are located in District 1.

Some serviced apartment projects to be up and running in the city in 2015- 2016 include Ascott Waterfront Saigon, Saigon Plaza, and C.T Plaza Saigon.

Vinpearl beach villas attract buyers

Vingroup has quickly found buyers for dozens of luxury seaview villas bearing the Vinpearl Premium brand in Nha Trang, Phu Quoc and Danang since a sale launch Sunday.

Vacation villas of the Vinpearl Premium Nha Trang Bay, Vinpearl Premium Golf Land-Nha Trang, Vinpearl Premium Phu Quoc and Vinpearl Premium Danang are now available for sale in Hanoi and HCMC.

As many as 1,200 customers, including foreigners from Europe, Japan and South Korea, got detailed information about the Vinpearl Premium villa chain and advice on the profit sharing policy for buyers at the sale events. Many of them registered to buy seaview villas with separate gardens and swimming pools.

The four international-standard villa complexes overlook the beaches of Danang, Nha Trang and Phu Quoc. In addition to free stays during their vacations, buyers of Vinpearl Premium villas are offered an investment opportunity on the vacation property market, with 85% of the profits from leasing these villas going to them and a profit guarantee of 8% per year.

Owners of Vinpearl Premium villas can get 15-30 free nights a year at any resort of the five-star Vinpearl chain. Besides, they can enjoy food and entertainment services at Vinpearl resorts and Vinpearl Land recreation park, and golf course.

Fully-furnished Vinpearl Premium villas cover 333 square meters to 1,300 square meters, and consist of two to four bedrooms.

According to statistics of the Foreign Investment Agency, foreign investors registered US$20.23 billion for projects in Vietnam last year, with US$2.54 billion of it for property projects.

Experts predicted the vacation property market would get bustling when the amended housing law that allows foreigners to own properties in Vietnam takes effect this July.

Banks speed up lending ahead of Tet

Local banks are stepping up lending to individual and corporate customers to cash in on the traditional spending spree in the lead up to the Lunar New Year holiday, or Tet.

Vietnam Prosperity Bank (VPBank) offers business installment loans and unsecured cards for enterprises wanting to raise capital and invest in fixed assets such as factories, machines and equipment, Vietnam News Agency reports.

For the business installment loan product, each firm is entitled to a credit limit of VND5 billion (US$234,500) with a tenor of three years. Meanwhile, with the unsecured card, VPBank offer loans of up to VND2 billion each and other incentives for corporates.

The bank said the two products are designed for businesses in sectors such as wood processing, textile, garment, consumer goods and electronics.

Meanwhile, VietABank has launched a credit package for individual customers who want to do business, construct or repair homes, and buy cars.

The bank applies an interest rate of 7.7% per annum and flexible lending terms. Loans are available from now to March 31.

Trinh Minh Thao, deputy general director of VietABank, said the bank would simplify procedures.

Smuggling situation remains unanticipated

Before Tet holidays, rising demand for goods and big profits prompt traders to increase smuggling of Chinese-made goods through northern borders in Lang Son, Quang Ninh and Lao Cai provinces. This year, smuggling tends to decrease, thanks to strong measures taken by police, but remains unanticipated.

Prior to Tet holidays, smugglers not only smuggled essential goods such as: clothes, garments, footwear, and electronic appliances, but also forbidden goods like firecrackers, counterfeit money, cigarettes, fake alcohols, and foods with unclear origin. Especially, they use every sophisticated and vicious trick to cope with authorities.

With a long border of tens of kilometers from Tan Thanh Border Gate to Coc Nam Border Gate, Lang Son Province’s Van Lang and Cao Loc districts are considered as hot spots for smuggling of Chinese goods. In addition, this area also has several trails and shortcuts for smugglers to take advantage of.

Senior lieutenant colonel Ninh Van Hop, a commanding officer of Huu Nghi Border Post in Lang Son Province, said that his post is responsible for a boundary of about 4 kilometers. However, it is very difficult for them to prevent smuggling because there are trail and shortcuts that lead to China’s Nonghuai Market in Pingxing after passing a few mountain ridges. During peak time, there are up to 300-500 people carrying smuggled goods from China into Vietnam and around 200 motorbikes and cars use for transporting.

Meanwhile, at Tan Thanh Border Gate, the largest open economic zone in the northern border area, trade is humming with lines of container trucks cramming the border gate.

According to customs officers at Tan Thanh Border Gate, the border gate sees the highest amount of goods exported and imported at this time because consumption demand of both Vietnam and China strongly raises on the occasion of lunar New Year. Vietnam mainly exports fruits, farm produce, and seafood to China while importing many various kinds of goods from China.

At Tan Thanh Market, kiosks display all kinds of goods, including clothes, footwear, electronic products, cosmetics, medicines, and foods. Traders at Tan Thanh Market are both Vietnamese and Chinese. Although having owned two fabric and clothes stores in China’s Po Chai Market, Tong, a Chinese trader, still goes to Tan Thanh Market for trading and seeking business partners every day.

Tong revealed without hesitation that all kinds of goods can be found at border area, even forbidden goods, such as: counterfeit money, firecrackers, swords, and stun guns as long as buyers have enough money. Quality and price are also diversified.

He also unveiled that big Vietnamese traders, nowadays, rarely go to China or border gate. All steps of the transaction, comprising of selecting goods, ordering, and paying are conducted via the Internet or phones. Even transporting goods from border to Lang Son Province or Ha Noi City, the hardest step, takes no sweat.

Lieutenant colonel Vu Quoc An, commissar of Tan Thanh Border Post, said that due to high demand and big profits, smugglers have used every sophisticated and aggressive trick to bring smuggled goods into the country.

Smuggled goods usually are gathered at trails near the border, and then are split into small package for easily carrying. At the right time, hundreds of porters will carry goods cross the border into the inland. Traffickers also place outguards to monitor and block anti-smuggling force and hire local residents to transport goods. Noticeably, porters are not only youngsters but also old people and kids. They even force porters to deposit money when they are hired to transport smuggled goods so if porters are caught they will dump goods or fight against police to get their goods back.

Border Command of Lang Son Province said that in order to prevent smuggling, border guards have to place obstacles and keep close watch on trails that are usually used by porters despite severe weather.

According to Mr. Hop, Huu Nghi Border Post has raided and tackled 24 warehouses contained smuggled goods and uncovered 354 cases of smuggling, of which, there were seven cases of firecracker smuggling with nearly 400 kilograms of various kinds of crackers.

However, he also said that current anti-smuggling measures are merely palliative. It requires measures to resolve internal issues and promote domestic production in order to prevent smuggling thoroughly in long term.

ANZ: Vietnam consumer confidence drops slightly

Despite the tumbling global oil price, Vietnam’s consumer confidence index is slightly down to 135.4 (down 0.2 percentage point) in January and now staying above the 2014 average of 133.3, ANZ Bank said in a report released on January 28.

Vietnamese consumers have started 2015 with confidence largely intact after a tumultuous 2014, Glenn Maguire, ANZ Chief Economist for South Asia and ASEAN & Pacific, said in the ANZ-Roy Morgan Vietnam Consumer Confidence Index report.

“The most interesting aspect of the Vietnamese consumer confidence readings is that the very large decline in international oil prices has not been able to arrest a modest deterioration in Vietnamese consumer confidence in recent months. Indeed, we note that both assessments of the one-year and five-year economic and financial outlooks for Vietnam have been in a modest decline for three months now,” it said.

In terms of personal finances now, 33% (down one percentage point) of Vietnamese said their family is ‘better off’ financially than a year ago compared to 21% (down one percentage point) who said their families are ‘worse off’ financially.

Of the respondents, 53% (down five percentage points) of Vietnamese expect their families will be ‘better off’ financially this time next year compared to just 6% (up one percentage point) who expect to be ‘worse off’ financially.

Meanwhile, exactly half of respondents (unchanged) say Vietnam will have ‘good times’ financially during the next 12 months and only 14% (down one percentage point) expect ‘bad times’ financially.

In addition, 43% (up three percentage points) of Vietnamese said now is a ‘good time to buy’ major household items (the highest for this indicator since January 2014) compared to 11% (down two percentage points) who said now is a ‘bad time to buy’ major household items.

“We suspect that the ongoing slowdown in China and the interaction of that slowdown with the decline in the international oil price may hold the key to unraveling why Vietnamese consumer confidence appears to be underperforming the pick-up in confidence amongst regional peers,” Maguire said.

It is interesting to note that the large decline in recent oil prices has had less impact on consumer confidence than the deterioration (negative) and subsequent improvement (positive) in relations with China through 2014. This may reflect the fact that the decline in domestic pump prices (down a cumulative 12% since July 2014) has been much smaller than the decline in international oil prices.

Vietnam companies dragged down by old technology

Many Vietnamese private companies are using technology 50 years out of date, and as a consequence Vietnam was lagging far behind its competitors in the region, senior officials said.

Even though small- and medium-sized enterprises (SMEs) account for up to 98 percent of all non-state firms in Vietnam, most of them are still using technology from the 1960s and 1970s, said Bui Thu Thuy, deputy director of the Ministry of Planning and Investment (MPI)’s Department of Enterprise Development.

Thuy said non-state enterprises, especially SMEs, play a significant role in the country’s economy, with non-state enterprises contributing as much as 50 percent to Vietnam's GDP during in the period 2009-2012, and one third of the state budge in the 2011-2012 period.

They also account for some 30 percent of total investment and 45-47 percent of all jobs.

“Despite their important role in the country’s socio-economic development, SMEs in Vietnam are too modest in business size, and backward in technology and management, which results in weak competitiveness and inefficient operations,” Thuy said.

Most SMEs lacked adequate funding and mainly rely on bank loans to finance operations because of the lack of investment capital. Many SMEs have reported a considerable decrease in revenue and profit in recent years.

“Due to the lack of funding, private firms, especially SMEs cannot afford sufficient investment in technology," Thuy said.

"Most of them are using technologies that are from two to three generations older than the world average,” she emphasised.

According to her, as much as 80-90 percent of technology was second-hand and imported from foreign countries. Up to 75 percent of business and production machinery belonged to the 1960s and 1970s, and 75 percent of equipment has already been depreciated to zero, with only half the machinery replaced.

Thuy said such enterprises were spending only 0.2-0.3 percent of revenue on updating technologies, compared with five percent in India and 10 percent in South Korea.

Only 20 percent of Vietnam's enterprises have applied high-tech in their business, compared with 73 percent in Singapore, 51 percent in Malaysia and 31 percent in Thailand. As a result, Vietnam ranked 102nd out of 148 economies in the world and ninth out of ten countries in ASEAN in terms of technology application.

SMEs are facing increasing difficulties in getting access to bank loans due to their modest size and the lack of confidence in their capacity.

Tran Thi Hong Hanh, general secretary of the Vietnam Banks Association, said integration has brought about several business opportunities, but it was necessary to pay more attention to enhancing the competitiveness of local enterprises in order to ensure sustainable development.

Electricity price hikes to cover losses by state generator

Vietnam may face more power price rises this year and into the near future as state-owned Electricity of Vietnam Group (EVN) continues to incur big losses.

Deputy Minister of Industry and Trade Do Thang Hai told reporters there were three options on the table for higher  power prices this year, but the final decision would be based on the ability of people to pay a market-based price balanced against the country's economic growth.

If power prices remain low, EVN may have to file for bankruptcy as it doesn't have the financial resources to continue selling electricity at below cost, Hai said.

EVN has reported a group loss of more than VND8.8trn due to foreign exchange rate fluctuations, noting it had been ordered by the government to get its balance sheet in order by 2015.

Hai said it was inaccurate to claim a hike in power prices was designed to help EVN offset its losses, maintaining that power prices were much lower than its cost of production.

“The foremost purpose of price increase is to build up a competitive power market upon the government’s policies," Hai said.

“Many people disagree with sharp power price hikes, claiming that Vietnam is still an average-income country. However, I wonder whether people really have so little money when they consume a lot of electricty,” he said.

Hai expected that higher electricity prices would encourage people to use energy more efficiently.

Several international organisations have urged Vietnam to increase electricity prices by 40 percent over three years, so the country can build a competitive power market in order to attract investment and raise competitiveness in the power sector.

Due to low power prices and increasing demand, EVN has had to import electricity from foreign sources, including China. The government subsidises electricity, which can be seen as supporting energy exporters to the detriment of local consumers.

The European Chamber of Commerce in Vietnam (EuroCham) recently published a "white book" on energy in Vietnam, in which it saw great potential for wind energy, and stressed the need for transparency and competitiveness in Vietnam’s electricity industry.

Retail sales and consumer services rise slightly in January

Revenues from retail sales and consumer services in January increased by 2.2% against the previous month and 13% over the same month last year, according to the General Statistics Office.

Total revenues in January were estimated at VND275.5 trillion (US$12.9 billion), a rise of 11.9% from January of 2013 when adjusted for inflation.

The national statistical agency said revenues from domestic private enterprises accounted for 86% while the State and foreign sectors made up 10.8% and 3.2% respectively.

A breakdown shows that retail sales revenues went up 3.1% from December to more than VND211 trillion (US$9.9 billion), driven by solid sales of garment products and household appliances.

Revenues from accommodation and restaurant services rose by 2.9% while revenues in the tourism sector fell 1.8%.

Last year, revenues from retail sales and consumer services rose 10.6% to reach more than VND2,945 trillion (US$138.4 billion).

Finance ministry considers bio-fuel import tariff hike

The Ministry of Finance is seeking to increase the tariff on E5 bio-fuel imports to 35% from the current 5% to encourage local fuel enterprises to produce this fuel.

The ministry is currently collecting comment from relevant agencies on the planned import tax hike for the bio-fuel, a mixture of 95% RON92 petrol and 5% ethanol.

According to the ministry, import tariffs on materials for producing the bio-fuel are much higher than the tax on imports of the finished product, thus encouraging bio-fuel import.

Earlier, Binh Son Refining and Petrochemical Co. Ltd. wrote to the ministry suggesting a tax rise on E5 imports for fear that its own bio-fuel cannot compete with the imported product in the coming time.

The company said as the current import duties on imports of E5, RON92 and ethanol are 5%, 35% and 20% respectively, the price of locally made E5 is much higher than the imported, making life tough for local enterprises to sell the bio-fuel on the domestic market.

Therefore, the current tax policy for fuel imports discourages the local production of the bio-fuel but even affects the implementation of the Government’s Decision 53 on the production and trading of the product, according to the company.

Binh Son can produce two million tons of RON92 gasoline annually and meet 30% of local demand for E5 bio-fuel.

Besides, several wholesale fuel enterprises import RON92 petrol to mix with ethanol to create E5 petrol for domestic sale.

Measures proposed to back supporting industries

Business executives and experts have called for State agencies to select contractors using domestic products and services as this is one of the effective measures to prop up underdeveloped supporting industries.

Developing supporting industries for the mechanical engineering sector is one of the priorities of the government of HCMC, heard a seminar on Tuesday. However, most enterprises active in this field are grappling with a host of difficulties in production and consumption.

It is not easy for an engineering company to find customers, said Do Phuoc Tong, vice president of the HCMC Association of Mechanical Engineering, at the seminar on supporting industries held by the city government.

The chairman of Duy Khanh Co. said customers will decline to cooperate if the production capacities and facilities of domestic enterprises are poor. Others are concerned about the quality of products and the honoring of contract terms.

Though the city government has helped build a bridge between enterprises in supporting industries and customers, results have not been as good as expected due to the limited capacities of domestic firms.

The city should set specific percentages for local content at projects so that investors will have to place orders with Vietnamese enterprises, Tong proposed.

Tong suggested the city give more opportunities for mechanical engineering enterprises to participate in projects funded by the State budget and request contractors to hire local sub-contractors or use certain volumes of domestic products as bidding criteria.

In addition, Tong proposed HCMC ask the Government to review and apply new import tariffs in machine and equipment imports to support domestic producers as the exisiting import duty policies are unreasonable.

For instance, most imported machines and equipment enjoy a zero tax while local companies have to pay 20-25% for parts they import for manufacturing mechanical products. This has eroded the competitiveness of local manufacturers, according to Tong.

According to industry insiders, many policies are hindering the development of enterprises not only in mechanical engineering but also in other sectors such as apparel, footwear, automobile and electronics.

Experts and enterprises at the seminar pointed out the lack of investment capital for enterprises, human resources and incentives as major problems for supporting industries.

Supporting industries are in a weak position, HCMC vice chairman Tat Thanh Cang said, because policy incentives for them are not working. These incentives are not better than those for other fields.

Enterprises warned of cyber attacks

Government officials have called for local organizations and businesses to prepare measures to counter cyber attacks and cushion their impact if hacked.

Huynh Ngoc Son, vice chairman of the National Assembly, told a conference in Hanoi on January 28 that computers and the Internet have contributed a great deal to socio-economic development in many nations but hacking has threatened peace and security in the world.

The number of hacker attacks on the databases of many countries has been on the rise.  

“The latest incidents have showed the serious impact of cyber attacks. Thousands of websites in Vietnam, including those of State agencies, have been hacked in recent years, causing great damages,” Son said.

Hoang Phuoc Thuan, head of the Department of Network Security under the Ministry of Public Security, said many countries consider hacker attacks as a leading threat to their security.

Le Ba Quoc Thinh from the Department of Information Security under the Ministry of Information and Communications said there were some 275,000 website attacks in HCMC alone last year, up three times against 2013.

Nguyen Minh Tuan from the Ministry of Defense said cyber attacks have been detected not only in the political field but also the economic one. Therefore, Vietnam should enhance international cooperation and join international cyber security organizations to cope with threats from the Internet.

Thinh suggested the Government develop special units and boost personnel training to cope with hacker attacks.

EVN to sell VND1 trillion worth of non-core stakes this year

Vietnam Electricity Group (EVN) will sell some VND1 trillion worth of share holdings in non-core businesses this year as part of a Government-approved plan to restructure State-owned business groups and corporations.

EVN said in a document sent to the Daily that it divested VND691 billion (over US$32.3 million) from non-core operations last year, or 40.8% of the State capital it is required to divest in line with its restructuring scheme.

The group completed offloading shares at Saigon Vina Real Estate Joint Stock Company and Central Power Real Estate Joint Stock Company last year.

EVN said as uncertainties on the local stock market remain, it has drawn up plans to boost capital divestments from non-core business operations via auctions and negotiations with partners for capital transfers.

EVN plans to complete divestments from real estate, banking, insurance and stock sectors this year to focus its resources on electricity generation and trading.

In August last year, the Government approved a financial management mechanism allowing EVN to invest State capital and other sources in business activities, except for real estate, banking, insurance, and securities sectors. Special investments in these four sectors require approval from the Government.

As regulated, EVN’s financing sources include State capital and funds the group mobilizes from different sources in line with existing rules, apart from the funds it is managing.

US$273 million loans for power grids in Hanoi, HCMC

Prime Minister Nguyen Tan Dung has okayed the use of nearly US$273 million lent by the Asian Development Bank (ADB) and the ASEAN Infrastructure Fund (AIF) for development of power grids in Hanoi and HCMC.

Hanoi Power Corporation (EVN Hanoi) and HCMC Power Corporation (EVN HCMC) will be re-borrowing the loans in line with terms and conditions of ADB and AIF plus the Government’s lending cost of 0.25% per annum. The 20-year loans have a grace period lasting until March 15, 2020.

Vietnam Electricity Group (EVN) has committed to repaying the loans for EVN Hanoi and EVN HCMC in case the two companies default.

The project aims to reduce power outage, ease overloads for the 220kV and 110 kV transmission lines, cut electricity losses, improve power supply quality, and meet the fast-growing demand in the country’s two biggest cities between 2014 and 2016 with a vision to 2020.

Last year, EVN spent VND125.5 trillion on many electricity source and network projects to secure stable power supply for Hanoi, the southern region and key economic zones. The investment rose by 28% compared to 2013.

More firms to enjoy customs priority

Enterprises having annual imports and exports of US$100 million or above and abiding by regulations will get customs clearance priority.

According to the Government’s Decree 08/2015/ND-CP with effect from March 15, fewer customs procedures will be applied to exporters with revenues of US$40 million per annum or higher and those of Vietnamese farm produce and seafood with annual revenues of US$30 million or above.

Besides export revenue, exporters must have observed customs and tax laws for two consecutive years, have used recognized auditing standards, and have had an internal control system in place for import and export goods.  

Under the current Circular 86/2013/TT-BTC of the Ministry of Finance, only those companies having general goods imports and exports of US$200 million a year are entitled to priority customs clearance. To enjoy this treatment, exporters of farm produce, seafood, apparel and footwear must have annual revenues of US$50 million.

Once recognized as priority firms, they will be exempted from customs inspections at border gates.

The priority enterprises may be recognized by other member states of the Trans-Pacific Partnership (TPP) once this multilateral trade pact is signed.

Hai Duong’s FDI hits 88 million USD in January

The northern province of Hai Duong attracted 88.1 million USD in foreign direct investment (FDI) in January, a 20 percent increase from the same period last year.

According to the provincial Department of Planning and Investment, the local authorities aim to lure a total of 200 million USD of investment capital in 2015.

To realise these targets, the locality will intensify investment promotion campaigns targeting large and multinational groups as well as working closer with central ministries.

Administrative reform, the simplification of investment procedures, and increased management will be carried out to create improved conditions for foreign investors to operate in the province.

The locality will also focus on strengthening links with investors to increase confidence.

Hai Duong is home to 292 foreign-invested projects from 24 countries and territories worth 6.5 billion USD, of which 2.9 billion USD has been disbursed.

The projects have created over 140,000 jobs.

HCM City boosts trade promotion in key markets

The Investment and Trade Promotion Centre (ITPC) of Ho Chi Minh City will focus on key markets like Russia, China’s Hong Kong, Cambodia, Myanmar, Indonesia and Laos in 2015 to expand market share of Vietnamese goods abroad.

ITPC Director Pho Nam Phuong said that the centre will accelerate the organisation of fairs and dispatch of more delegations to study these markets.

It will also promote activities to attract foreign investment in hi-tech industry and agriculture and support industry.

According to an ITPC report, last year, the centre welcomed 91 delegations from numerous countries, including the US, Japan, Germany, Russia, Indonesia, and France, coming to the city to seek business and investment opportunities.

It also organised six made-in-Vietnam goods fairs in districts across the city, drawing the participation of 300 enterprises and over 100,000 visitors.

In 2014, Ho Chi Minh City ranked second in foreign direct investment attractions with the total capital of 3.2 billion USD, a surge of 91.6 percent against the previous year. Its export value hit 32 billion USD, up 8.8 percent year-on-year.-

 

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

MORE NEWS

VIETNAM NEWS HEADLINES SEPTEMBER 29

Buckwheat Flower Festival returns to Ha Giang in November

Vietnam welcomes 1.87 million foreign visitors in nine months

Vietnam welcomed about 1.87 million international arrivals in the first nine months of this year, 16.4 times higher than the same period last year but much lower than that in the same time in 2019 before COVID-19 broke out.

Close to 123,000 sea turtles released back to sea

The Con Dao National Park in the southern province of Ba Ria-Vung Tau released 122,867 baby turtles into the ocean between January and September.

Vietnamese, Danish friendship blossoms over the years

Many foreigners have enjoyed diverse landscapes, authentic local food, endless love, eternal friendship, and a favourable investment environment in Vietnam.

China imports less glutinous rice from Vietnam

The proportion of glutinous rice in total rice exports to China has fallen from 74 percent to 48 percent.

Vietnamese artists to appear in Norwegian play

Several talented local artists from the Vietnam Youth Theater have been invited to perform in 'Hedda Gabler', a classic play which is considered to be one of the outstanding works of Norwegian writer Henrik Ibsen.

Minor improvements seen in the transparency of provincial budgets

The average ranking of budget transparency for localities in 2021 was 69.53 points out of 100, a rise of just 0.44 points compared to 2020.

Pianist Nguyen Dang Quang returns home for concert of classical music

Piano player Nguyen Dang Quang, son of composer Quoc Trung and renowned artist Thanh Lam, is a fresh and promising presence at the event.

VN central bank acts to tighten the Vietnamese dong liquidity

A recent money market report of Saigon Securities Incorporation (SSI) showed the SBV last week net withdrew a total of VND34.6 trillion through the OMO channel.

Vietnam needs to improve human resources in digital age: World Bank

To reach the goal of becoming a high-income country by 2045, Vietnam needs to quickly improve the quality and quantity of its human resources.

Vietnam’s GDP rises by 13.67% in third quarter: statistics office

Vietnam’s gross domestic product (GDP) grew by 13.67% in the third quarter, according to the General Statistics Office (GSO).

Ministry of Culture demands strict supervision of beauty contests

Culture, Sports, and Tourism Minister Nguyen Van Hung has signed a directive strengthening state supervision of a variety of cultural and artistic activities, including beauty pageants and modelling contests.

VIETNAM BUSINESS NEWS SEPTEMBER 29

Vietnam to become “new Asian tiger”: Italian journal

Vietnam to become the worlds chip production center

In the first eight months of this year, phones and electronic components have the most prominent export turnover in our country, reaching nearly 40 billion USD.

Currency stable amid fresh Fed hike

Despite the US Federal Reserve’s latest interest rate hike, the Vietnamese currency has seen only limited depreciation when compared to the currencies of its regional partners.
back_to_top