Gold makes correction   

The price of gold in Vietnam fell by VND80,000-100,000 a tael (1.2 ounces) on January 20 as global prices remained hovering around US$1,370 an ounce.

Gold was bought at nearly VND35.55 million and sold around VND35.65 million at most gold shops as of 10 am local time.

Sacombank Jewelery Company bought gold at VND35.56 million and sold at VND35.62 million.

Meanwhile, Hanoi-based Phu Quy Jewelry purchased SJC-brand gold at VND35.55 million and sold at VND35.65 million.

The US dollar exchange rate almost unchanged as of the previous day on free market this morning. Dollars were bought at VND20,970 and sold at VND21,010, an increase of VND10 per dollar in selling price over the previous day.

Internationally, gold sometimes exceeded $1,380 an ounce in the trading session in New York as the US dollar debased against the euro. However, bullion closed at $1,371.5 an ounce, up $2.8 an ounce, due to profit-taking.

In Asia, the metal marched south this morning. Spot gold stood below $1,269 an ounce as of 10 am Vietnamese time.

Statistics released yesterday showed that the US new home construction in December sank to one-year low, citing that a gloomy housing market will be a brake to the US economic recovery.

The greenback exchange rate against the euro recovered to $1.34 a euro in Tokyo this morning before falling to nearly $1.35 the previous day.

Holdings at SPDR Gold Trust, the largest exchange-traded fund backed by bullion, dropped by 5.5 metric tons to 1,251.4 metric tons, the lowest level in the past eight months.

Crude oil futures for February delivery finished at $90.86 a barrel in the New York Mercantile Exchange, the lowest level since January 10, under negative effect caused by the US housing market.

Crude oil continued sliding to around $90.4-90.5 a barrel this morning.

Fund exits hit 150 in seven years

Despite some rumours that foreign investment funds had faced difficulties in divestment, a new survey conducted by Grant Thornton Viet Nam found that 150 full and partial exits were achieved during the 2003-10.

Some successful exits included those of Dragon Capital, which successfully sold its stakes in VP Bank and Vinamilk, and VinaCapital, which divested from Masan Group and the Hilton Ha Noi.

The value of full and partial exits fell to US$150 million last year, Grant Thornton reported, after peaking during the financial crisis at $230 million in 2008 and $242 million in 2009.

Stock exchanges continued to be the predominant method used by fund managers to divest, accounting for 60 per cent of all exits.

The average holding period for each exited investment was about three years, the survey found, although the trend had been for longer-term investments.

"The average holding period has been trending upwards over the survey period, with exits in 2010 taking, on average, between four and five years" said Grant Thornton Viet Nam managing partner Ken Atkinson. "Based upon the large number of investments made in 2007, the next two years should result in a growing number of investment exits."

Over $1.8 billion worth of private equity investment has been made in almost 200 Vietnamese companies since 2003. The number and value of those invesments fell sharply beginning with the global financial crisis in 2008, dropping from $752 million in 2007 to just $71 million last year.

State Bank to curb illegal dollar trades

The State Bank of Viet Nam will crack down on the foreign exchange black market in HCM City to keep exchange rates under control, an official says.

Nguyen Hoang Minh, deputy director of the central bank's HCM City branch, said the move followed a directive from the central bank governor on January 4 to step up monitoring of the illegal forex trade.

Last year, the branch and the city police uncovered 37 cases of illegal trade in foreign currencies and listing of commodities prices in foreign currencies, he said.

Offenders in 36 of the cases were fined a total of more than VND2 billion (US$105,000).

Together with the Market Watch Division, the branch uncovered a further 16 such cases and fined them VND400 million.

"The foreign exchange rate on the black market remains much higher than at banks since demand from importers always spikes ahead of Tet (the Lunar New Year)," Minh said.

To control the black market, especially for US dollars, the central bank needed to have effective intervention measures like selling and swapping foreign currencies, he said.

The SBV should allow banks to sell foreign currencies to more categories of customers and give priority to selling dollars for import of essential goods, he added.

Off-season fruit harvests have been poor in most provinces in the Cuu Long (Mekong) Delta, but prices have risen as export demand soars and sales for Tet (Lunar New Year) holiday increase.

Cao Van Hoa, deputy director of Tien Giang Province's Department of Agriculture and Rural Development, said the off-season durian crop had been affected by inclement weather and, as a result, prices had soared.

With the current durian price, farmers are earning VND500 million (US$23.81 million) per ha, twice the amount for the same period last year, Hoa said.

With Tien Giang's 6,000ha of durian, most farmers produce off-season durian to earn higher prices by using special farming techniques.

However, this year, when the durian flower blossomed, there were heavy rains, which prevented the plant from bearing fruit, according to agriculture officials.

In Dong Thap Province, which has 7,000ha of mango, prolonged rains and hot weather have also caused a poor crop of off-season mangos.

Meanwhile, farmers in An Giang Province's Tinh Bien and Tri Ton districts are harvesting a good crop of off-season mangos.

Traders have purchased the two districts' mangos to export to Cambodia and China.

The two districts grow a total of 2,000ha of mangos and most of them belong to three mango varieties, Thanh Ca, Hoa Loc and the grafted variety.

This is the first year that the two districts' mangos were exported in large numbers, reaching hundreds of tonnes over the past few months, according to the An Giang Department of Agriculture and Rural Development.

Traders are purchasing Hoa Loc mangos at orchards for VND20,000-30,000 ($1-$1.5) a kg, up VND5,000-7,000 against the same period last year.

Tran Van Mi, head of the Tri Ton District Agriculture and Rural Development Bureau, said this season traders bought all mangos in the district for export and domestic consumption, especially the Thanh Ca mango, a speciality of the province.

The price of many fruits used extensively during Tet have risen in the Delta as traders have begun to buy more fruit for the country's biggest holiday season, which begins on February 3. Traders are buying Nam Roi grapefruit at orchards in Vinh Long and Hau Giang provinces at a price of VND100,000 ($5.1) for 10, up VND30,000 compared to last month.

Nguyen Van Khanh, who grows Nam Roi grapefruit in Phu Huu A Hamlet in Hau Giang Province's Chau Thanh District, said: "Inclement weather has made grapefruit yields low compared to previous years. Traders are now buying grapefruit to stock for Tet."

About 50 per cent of Nam Roi grapefruit in orchards in Phu Huu A Hamlet have been bought in advance by traders, according to growers.

Tran Van Sang, chairman of the My Hoa Nam Roi Grapefruit Co-operative in Vinh Long Province, said: "The price of Nam Roi Grapefruit is at VND8,000 ($0.4) a kg, the highest over the past year.

Farmers are very glad because the price of grapefruit for Tet has risen a lot."

The co-operative is estimated to supply about 100 tonnes of grapefruits for supermarkets and trade centres in HCM City, and southeastern and northern provinces this Tet. It will also supply 100 tonnes of grapefruit for wholesale markets this Tet. The price of Lai Vung mandarin, a speciality of Dong Thap Province, has increased by VND6,000-7,000 ($0.3-$0.4) a kg compared to the same period of last year. The price of King oranges at orchards in Hau Giang Province is VND17,000 ($0.8) a kg. Farmers said with this price, they could earn a 50 per cent profit.

Footwear industry urged to focus on local market

Major opportunities will be presented to local footwear producers to further develop as local demand is forecast to increase by roughly 8 per cent yearly to 355 million pairs by 2020, according to the Viet Nam Leather and Footwear Association (Lefaso).

The association estim-ated that footwear demand in the domestic market in the coming years would increase by more than 10 million pairs yearly thanks to an annual population growth rate of 1.1 per cent.

In Viet Nam, each person buys an average 1.5 pairs of footwear a year, meaning the whole country uses more than 130 million pairs per year. However, the lack of awareness of Vietnamese brand names, poor distribution and a lack of innovative designs are the main reasons causing Viet Nam-made products to be considered inferior to imports.

Chairman of Lefaso Nguyen Duc Thuan said that the industry first of all must develop a trademark and gain a substantial foothold in the domestic market if it wants to ensure the sustainable develop-ment of the sector.

Thuan said if local footwear producers dominated the domestic market, paid more attention to building trademarks and produced high-grade products, they could do less outwork for foreign companies, build their reputation in the inter-national market and increase exports to make higher revenue.

Echoing Thuan, Lefaso deputy chairman Diep Thanh Kiet said to achieve the target, domestic enterprises needed to plan their activities and to build their brands which play an important role in holding domestic market share.

In addition, it was necessary to set up a large distribution system where enterprises could gather to sell products at certain sale points, like Viet Shoes Plaza.

Kiet said with Viet-namese products gathered in the same place, consumers would know where to go to purchase Viet Nam-made shoes.

He said it was also necessary to establish a centre in charge of inspecting locally made footwear and granting quality certificates.

This would help footwear producers advertise and give Vietnamese consumers confidence in the quality of domestic products.

Firms to receive IT, financing assistance

The HCM City Business Association would assist businesses with finance and technology this year, chairman Huynh Van Minh told a meeting held in HCM City yesterday.

Since banks had hiked interest rates to 18-20 per cent and businesses found it difficult to get loans, the association would guarantee loans obtained by small-and medium-sized enterprises from the SME Support Fund.

Interest rates should be adjusted to enable businesses to expand production and exports.

Support policies for SMEs needed to be updated if they were to develop, especially after the success of the 11th National Party Congress.

Technology and technical skills were key factors for domestic businesses to improve their competitiveness, and they needed to upgrade technologies.

The association would undertake practical technology-renovation programmes to help businesses improve product designs and quality to increase consumers' trust.

It would also expand trade promotions at home and abroad and organise more business trips to help businesses understand about potential markets.

Last year the association had organised business trips to the US, Canada, South Korea, China, and Singapore.

It would disseminate market information as well as support policies to enable businesses to take full advantage.

It planned to establish an Export Goods Introduction Centre to popularise Vietnamese export products.

Security expo to be held in Ha Noi

The sixth Security World Conference and Expo 2011 will be held in Ha Noi in early April with the theme "Secure your organisation in a connected world".

The conference will introduce security strategies for coping with new threats, information security reports, and solutions for multi-functional and interactive software products. A security expo will be held along with the conference to showcase the latest software products and equipment. Attendees will also have the chance to share their experiences with each other.

The annual event is jointly organised by the Ministry of Public Security and the Viet Nam Computer Emergency Response and International Data Group (IDG).

Three banks raise charter capital

The State Bank of Viet Nam has approved the plans of three banks to raise their charter capital. The increased capital will help the banks raise their financial capabilities, invest in infrastructure and technology, and expand mid-to long-term loans.

The charter capital of the Housing Development Bank (HDBank) will increase to VND3 trillion (US$142.85 million) from VND1.55 trillion ($72.8 million), Indovina Bank Ltd's to VND3.2 trillion ($165 million) from VND2.5 trillion ($125 million), and Tien Phong Bank's to VND3 trillion ($142.85 million) from VND2 trillion ($95.23 million).

Work begins on Vung Tau urban area

Khang Linh Real Estate Co Ltd has started construction on the Metropolitan Vung Tau urban area in the southern province of Ba Ria-Vung Tau with a total investment capital of VND2.5 trillion (US$119 million).

The project, covering an area of 43ha, includes buildings, villas, apartments, a trade centre, offices for lease, and a school. Due to be completed in 2012, the urban area will house 8,000-12,000 people.

State Bank, Ernst & Young sign deal

The State Bank of Viet Nam (SBV) last week signed a contract with Ernst & Young Company stating that the company would provide consultancy and technical assistance to modernise the bank.

The US$5 million deal, which is part of a project sponsored by the World Bank and the Japanese Government, aims to develop the SBV's information technology capacity to serve as a foundation for improved management.

This will allow the management of the SBV to meet international norms.

It will also improve the quality of the SBV's information analysis to formulate and implement monetary policies, as well as ensure the safety of the banking system.