Ho Chi Minh Expo kicks off in Myanmar

The HCM City Investment and Trade Promotion Centre (ITPC) in collaboration with officials from Yangon City on May 20 co-organized a fifth Ho Chi Minh Expo at Tatmadaw Hall in Myanmar’s largest and most commercially important city.

The four-day exhibition is part of a series of events aimed at promoting trade and investment in Myanmar to help enterprises expand markets and establish distribution channels for Vietnamese products throughout Myanmar.

Municipal leaders are leading a delegation conducting a market survey in Myanmar that are also providing financial support to domestic enterprises in covering the VND14.5 million cost of leasing their pavilions at the event.

Reportedly, last year, the HCM City Expo in Myanmar attracted the participation of more than 54,000 visitors.

Vietnam attends EWEC development conference

A Vietnam delegation led by Deputy Foreign Minister Ho Xuan Son on May 20 attended the third deputy foreign ministerial conference on East-West economic corridor (EWEC) development taking place Bangkok, Thailand, with the participation of four countries- Laos, Myanmar, Thailand and Vietnam- and Asian Development Bank (ADB) representatives.

The meeting reviewed the implementation of decisions adopted at the previous conferences and devised solutions for overcoming difficulties and obstacles so as to promote the efficient development of the EWEC.

It also adopted a joint declaration, hailing the EWEC development achievements especially in improving infrastructure along the corridor, fine-tuning the legal framework for cross-border transport cooperation.

Delegates lauded Myanmar’s EWEC connectivity efforts through the upgrading and improvement of inland roads linking to the EWEC road network.

The delegates consented to add road No 12 to the Cross-Border Transport Agreement (CBTA) and set up a fixed bus route between the three countries as well as seeking funds for road accidents and maintenance.

The conference agreed to hold a joint meeting of Laos - Thailand – Vietnam experts under the Memorandum of Understanding (MoU) on initial implementation of the cross-border transport facilitation agreement (IICBTA).

Participants asked the ADB to support urban development on the border and along the EWEC.

Myanmar is to host the fourth conference of its kind.

Green, energy-saving solutions on display at Hanoi Expo

As many as 150 domestic and foreign businesses took part in an international fair to introduce their energy conservation, environmental protection and sustainable development solutions.

The three-day International Exhibition Fair for Environment and Energy Technology (Entech Hanoi -2015), which opened on May 20 in Hanoi, features 200 booths.

More than 60 businesses from the Republic of Korea — which recently signed a free trade agreement (FTA) with Vietnam — brought a wide range of new-cutting edge products to the event.

Most of the exhibits are related to engineering; renewable and alternative energy; traffic and transportation; petrol, gas and coal; and industrial waste treatment technology.

Speaking at the opening ceremony, Director of the Department of Industry and Trade Le Hong Thang said that the annual fair, launched in 2009, has over the years drawn more than 800 domestic and foreign exhibitors.

On the occasion, several Vietnamese firms were honored for their outstanding green solutions in energy saving and environmental protection.

Last year, the event led to 640 transactions and 160 signed technology transfer contracts worth 9.5 million USD.

Seminar promotes German investment in Vietnam

Authorities and businesses from Vietnam and Germany gathered at a seminar on May 19 in Berlin, Germany to seek ways to promote German investment in the southeast Asian country.

Speaking at the opening of the seminar, Vietnamese Ambassador to Germany Nguyen Thi Hoang Anh attached significance to the event amid the 40th founding anniversary of diplomatic relations between the two nations.

She highlighted the space for the two nations to strengthen their cooperation and to fully tap the potential of the strategic partnership established in 2011.

Vietnam and Germany aim to achieve bilateral trade worth 10 billion EUR, Anh said.

The Vietnamese Embassy in Germany will ensure its role as a bridge to connect the two nations and actively support bilateral cooperation, Anh affirmed.

Meanwhile, Deputy Minister of Industry and Trade Tran Tuan Anh, who led the Vietnamese delegation to the ongoing “Asia-Pacific Week” in Germany, underscored the two nations’ roles in the economy of the region and the world.

Vietnam has integrated into the global economy by actively playing a role in the World Trade Organisation (WTO), Asian free trade agreement (AFTA), accelerating the signing of other FTAs, and the Trans-Pacific Partnership (TPP), the minister said.

Vietnam will continuously improve its legal framework and administrative procedures opening up opportunities for German investors, particularly in vocational training, technology transference and human resource training and development, Anh added.

He highlighted Vietnam’s business climate with its stable macro economy, young labour force and consistent policies as advantages for international investors while hailing the contributions made by the two nations’ business communities in fostering their multilateral cooperation.

He also expressed his expectation for strong development in cooperation between Vietnam and Germany as well as other partners in the EU in the coming years.

Germany is currently the largest European trade partner of Vietnam with two-way trade reaching nearly 8 billion USD, accounting for over 20 percent of the total trade between Vietnam and the EU.

More than 300 German businesses have been licensed to operate in Vietnam with Siemens, Daimler, Adidas, Braun and Allianz as long-term operators in the country.

Vietnam-EU trade deal broadens opportunities for enterprises

The EU-Vietnam Free Trade Agreement (EVFTA) will create ample opportunities for enterprises from both sides, heard a talk on the deal held in Flamand, Belgium on May 19.

Vietnam’s dynamic economy will open up great opportunities for foreign investors, especially enterprises from the EU, stated Deputy Director General of the European Commission’s Directorate General for Trade Mauro Petriccione, who is also Chief Negotiator for the EU.

He said that during negotiations, Vietnam and the Europe have reached agreements in wooden furniture, services, investments, tariffs, government purchasing, competitiveness and sustainable development.

For his part, Vietnamese Ambassador to Belgium and Head of the Vietnam Mission to the European Union Vuong Thua Phong said that the EVFTA will bring Vietnam and the EU a stable business climate while fuelling economic growth for both sides.

He underscored that the trade deal will help the EU balance its trade deficit with Vietnam, promoting trade through liberalisation and market approaches.

However, the Ambassador pointed to challenges faced by the Vietnamese economy such as low competitiveness compared to European businesses across capital, technology, experience and labour quality.

Vietnam is a trustworthy partner of the EU, Minister-President of the government of Flanders Geert Bourgeois told a Vietnam News Agency correspondent, expressing his hope that the EVFTA will be signed this summer.

On May 18, the Belgium-Vietnam Chamber of Commerce and Industry (CCIBV) also held a conference on Vietnam-EU trade relations.

The EU is one of the large import markets for Vietnamese commodities, particularly leather shoes, garments, farm produce and aquaculture.

In 2014, the EU became the biggest importer of Vietnamese leather shoes when over 2 billion USD worth of goods were shipped to European countries, followed by garments with 1.98 billion USD and aquatic products with 950 million USD.

After signing the trade deal, 90 percent of Vietnamese goods being exported to European markets will go enjoy tariff of zero percent.

Vietnam is the third ASEAN country to hold FTA negotiations with the EU after Singapore and Malaysia.

Vietnam, Japan push forwards trade cooperation

Business operation will be facilitated in Vietnam and Japan through an extended economic cooperation framework agreement between Vietnam’s Ministry of Industry and Trade and the Kansai Bureau of Economy, Trade and Industry, as determined on May 19.

After the agreement was signed in late 2012 in Japan, the two sides have seen numerous achievements, including successful trade collaboration between the two countries’ business communities, development of the support industry in Vietnam and cooperation in environment and energy conservation.

The updated agreement will make great contributions to bilateral trade relations towards enhancing multifaceted cooperation between the two sides.

In the first eight months of 2014, Vietnam saw a trade surplus of nearly 1.86 billion USD from exports to Japan. The country’s imports from Japan hit 7.88 billion USD with the majority in machinery equipment, computers, electronics, steel products and plastic.

After signing the Vietnam-Japan Economic Partnership Agreement (VJEPA) in 2010, a number of Vietnamese export businesses have effectively taken advantage of preferential tariffs to boost exports to the Japanese market.-

Italian enterprises hail Vietnam’s investment climate

Vietnam has set a good example, among members of the Association of Southeast Asian Nations (ASEAN), in facilitating foreign investment, Italian businesses have opined.

A meeting was held by the Italian Ministry of Economic Development on May 19 in Rome to push Italian investment in the 10 ASEAN nations.

Executives from brands including Piaggio, Roberto Colannino, Aniston and Francesco Merloni encouraged other Italian firms to follow their lead by investing in Vietnam. They praised the country as a hub of development, production and distribution which can produce products for all southeast Asian nations.

Speaking at the opening ceremony, Italian Deputy Minister Carlo Calenda expressed his pleasure at the the Italian import value from Vietnam, which is one third of the total amount received by ASEAN members.

He also highlighted the huge potential of the Vietnamese market and the regional market felt by Italian firms, especially with free trade agreements to be signed soon with the European Union (EU) and the USA.

Meanwhile, ASEAN Secretary General Le Luong Minh underlined the roles of the bloc in the global economy as the world‘s seventh largest econo,y. The bloc has always welcomed investors across the world, including those from Italy and the EU, Minh said.

In 2014, the EU invested 29 billion USD in ASEAN, making up of 29 percent of the bloc’s total foreign investment. Two-way trade hit 40 billion EUR, making the EU the second biggest partner of the bloc, according to Minh.

The bloc’s chief expressed his hope of seeing more Italian businesses in regional nations, to promote technology transfers to ASEAN while contributing to Italy’s economic growth.

Romeo Orlandi from Italy’s Asian Observation Agency stressed the need for Italy to develop a long-term development strategy in ASEAN, and diversify its investment aspects to better tap the bloc’s potential.

According to the agency, the bloc is home to as many as 421 Italian firms, with 118 operating in Singapore, 76 in Vietnam, 73 in Indonesia, and 72 in Malaysia.

Two-way trade between Vietnam and Italy posted at 2.98 billion EUR in 2014, the highest value among the southeast Asian nations.

Deputy PM asks for stronger agriculture reform

Deputy Prime Minister Hoang Trung Hai has urged ministries, agencies and localities to accelerate the restructuring of the agricultural sector, saying that this is an urgent task.

During the first meeting of the interdisciplinary steering committee for agriculture restructuring in Hanoi on May 19, the Deputy PM stressed the need to raise public awareness of legal regulations, especially Vietnamese and international commercial laws.

He asked for stronger communication campaigns at all levels in the coming time, mainly targeting farmers.

Speaking at the event, Minister of Agriculture and Rural Development Cao Duc Phat reported that 17 national and 7 regional plans have been established to restructure the agriculture sector.

He said that these projects have contributed remarkably to the sector’s production and business activities. In 2014, the sector’s production value increased 3.9 percent and its GDP growth rate reached 3.49 percent, 0,22 percent higher than the set target.

However, some localities have still neglected to implement the project, with 27 provinces and cities yet to approve action plans for agricultural restructuring.

Concluding the meeting, Deputy PM Hai asked the Ministry of Industry and Trade to enhance closer links with the Ministry of Agriculture and Rural Development to make the project more effective, adding that it should focus on large-scale agricultural production and the development of key products.

Dong Nai holds dialogue with Taiwanese businesses

The People’s Committee of the southern province of Dong Nai on May 20 held a dialogue with over 100 businesses from Taiwan (China) based in the locality.

At the event, participants discussed policies and issues related to investment, export-import, anti-dumping taxes and foreign resident and labour registration.

The provincial Customs Department and the Taiwanese Business Association also used the opportunity to sign a partnership agreement, which will see the two sides share information about policies related to export-import and customs activities.

Currently, Taiwan is the largest foreign investor in Dong Nai, with more than 270 projects worth 4.8 billion USD. Taiwanese businesses are predominantly working in the manufacture of chemical products, garments, footwear and steel.

Third East-West Economic Corridor seeks solutions for development

The third East-West Economic Corridor Conference took place in Bangkok, Thailand on May 20, focusing on promoting the effective development of the region.

The deputy foreign minister-level conference passed a joint statement hailing the achievements made so far, especially in improving infrastructure along the corridor and completing a legal framework for trans-border transport.

It also appreciated Myanmar’s efforts to integrate by upgrading its domestic roads to connect with the road network in the corridor.

Countries agreed to soon hold a meeting among Laos, Thailand and Vietnam experts according to the memorandum of understanding on Initial Implementation of the Cross - Border Transport Agreement (II CBTA ).

The delegates agreed to add road No 12 to the CBTA and set up a fixed bus route between the three countries as well as seek funds for road accidents and maintenance.

The conference called for increasing investment, industrial and service activities along the corridor to create economic and social benefits for transit countries.

The participating nations called on the Asian Development Bank to help develop residential areas along the corridor and its extended roads.

The next conference will be held in Myanmar.

Food ingredients exhibition launched in HCM City

The 2015 Food Ingredients Vietnam (Fi Vietnam) exhibition opened on May 20 in Ho Chi Minh City.

More than 150 Vietnamese and international suppliers of food and beverage ingredients are exhibiting at the three-day show.

The event is expected to provide opportunities for businesses to learn of industry developments, food safety requirements and key market trends.

On the same day, the municipal Department of Trade and Industry held a conference to introduce the 2015 Sales Promotion Fair and 2015 Consumption Promotion Fair.

Each fair is expected to attract 350-400 businesses showcasing their products in more than 400 booths.

As scheduled, the Sales Promotion Fair will be held from August 28 to September 3 while the Consumption Promotion Fair will open on December 27 at the Phu Tho Indoor Stadium in District 11.

Agriculture sector to enhance effectiveness of cooperatives

A conference on cooperatives in the agriculture sector was held on May 20 in Hanoi to review their development and plan ways to improve their effectiveness.

The event was organised by the Ministry of Agriculture and Rural Development (MARD), the Vietnam Cooperative Alliance (VCA) and the World Bank.

Addressing the conference, MARD Minister Cao Duc Phat said that the key solution to develop business cooperatives in the sector is not to increase their number, but to find ways to efficiently manage them depending on their areas of production - for example, cultivation, breeding, aquaculture or forestry - and to provide them with necessary support.

Proper solutions are also needed to engage farmers in value chain production which facilitates more competitive agriculture, the minister added, stressing that businesses should not work independently of thousands of farmers.

He hoped that experience from other countries would help create a better linkage between businesses and farmers.

Ethel Sennhauser, Director of Agriculture Global Practice at the World Bank, underscored the importance of cooperative business in agriculture believed to help farmers access lowered priced supplies of input materials, work in larger scale production and distribute farming products.

During ten sessions of the conference, experts from Colombia, Indonesia and the Philippines gave presentations on the challenges they have overcome in developing their farmer groups and cooperatives. They discussed how cooperatives get access to financial sources, how to operate coffee and aquaculture cooperatives, and governmental support on offer to the groups and cooperatives.

Restructuring agricultural production was determined by the Prime Minister Nguyen Tan Dung as one of two pillars of key agricultural reform, which focuses on enhancing the effectiveness of cooperatives and other forms of cooperative businesses.

Dong Nai inks cooperative agreement with Japanese region

Southern Dong Nai province and the Bureau of Economy, Trade and Industry of Japan’s Kansai region on May 20 signed an economic cooperation framework agreement, with a focus on links in support industry.

Under the document, the two sides agreed to create favourable conditions for Kansai enterprises operating in support industry to invest in Dong Nai, while working together in training human resources for the sector.

Dong Nai will improve the work of its Kansai Desk to assist investors from the Japanese region in operating or seeking opportunities in the province.

Speaking at the signing ceremony, Director of the Bureau Seki Soichiro said that an increasing number of Japanese firms decided to invest into Dong Nai due to the locality’s favourable investment environment.

He noted that the Long Duc Industrial Park (IP) in Long Thanh district is being developed into a model IP for the partnership between Dong Nai and Kansai region. The IP is currently home to 18 Japanese investors, including eight from Kansai.

The Japanese business leader said he hopes the provincial authorities will continue facilitating investment activities of Kansai firms in Dong Nai in the coming time.

According to Chairman of the provincial People’s Committee Dinh Quoc Thai, the locality attracted over 1,000 foreign investors, including 190 from Japan with a total investment of 3.4 billion USD, mainly in support industry, high-technology and environmentally-friendly sectors.

RoK approves 77 million USD loan for Vietnam

The Republic of Korea (RoK)’s Ministry of Strategy and Finance on May 19 approved a 77 million USD loan for irrigational system upgrade projects in Vietnam’s central provinces of Thanh Hoa and Nghe An.

The loan will be provided through the Economic Development Cooperation Fund (EDCF).

The two projects will construct dyke and canals to bring water from Thanh Hoa’s Len river and Nghe An province’s Hoang Mai river to water local fields, while contributing to improving ecological environment, coping with climate change and rising seawater level.

Earlier, a working delegation from EDCF and the RoK’s Bank of Export- Import (EximBank) conducted a field research in the two provinces in late 2014.

EDCF is founded by the RoK government since 1987 and currently run by the EximBank. The fund aims to provide preferential loans for poor and under-developed countries to help them build infrastructure and contribute to bolster economic relations between RoK and other countries.

According to the RoK’s Ministry of Strategy and Finance, which decides the provision of EDCF loans, the country has lent 11 trillion KRW (10 billion USD) via EDCF funding by the end of 2014, and plans to lend another 1.4 trillion KRW this year.

Vietnam, Russia asked to expand trade, investment

The Chief Representative of the Russian Trade Office in Vietnam, Maxim Golikov, has suggested that Russia and Vietnam expand cooperation in trade and investment and carry out more policies to support businesses in order to gain sustainability in trade turnover.

Speaking at a press conference on Russia-Vietnam investment prospects in Hanoi on May 20, he stressed the need to focus on projects that boost socio-economic developments in the two nations, particularly those relating to new technologies.

He also told the media that investment attraction was one of the main issues mentioned at Russian Prime Minister Dmitry Medvedev’s working sessions with Vietnamese leaders during his official visit to Vietnam in April. More than a half of the eight cooperation documents signed at that time related to investment cooperation.

To achieve investment cooperation targets, the two countries have introduced new mechanisms, including the inter-governmental working group on prioritised investment projects. Additionally, the free trade agreement between Vietnam and the Eurasian Economic Union of Russia, Belarus and Kazakhstan, once effective, will create a systematic motivation for investors and new preferential policies for important investment projects, he added.

According to the official, economic-trade-investment ties between Vietnam and Russia have seen positive developments, with two-way trade reaching 2.59 billion USD in 2014.

Vietnam now runs 19 investment projects worth 2.47 billion USD in Russia, focusing on the fields of trade and oil and gas. Energy remains a strategic cooperation field, bringing about significant revenues for both sides.

Deputy PM: Foundation in place to achieve 6.2 percent growth target

Vietnam enjoyed an encouraging socio-economic performance in 2014 and the first few months of 2015, creating a foundation for the country to achieve its 6.2 percent economic growth target this year, read a report delivered at the opening session of the 13th National Assembly (NA)’s ninth sitting on May 20.

The Government’s supplementary report on the implementation of socio-economic development and State budget plans was presented by Deputy Prime Minister Nguyen Xuan Phuc, who said 13 out of the 14 key targets for 2014 were fulfilled or exceeded. The one target missed was for the rate of trained workers.

The GDP growth of 5.98 percent last year, the highest since 2011, surpassed the set target while the CPI expansion was at a record low of 1.84 percent.

Export turnover rose by 13.7 percent, helping the country see a trade surplus of 2.1 billion USD in 2014, the third year of surplus in a row, the official said, adding that Vietnam succeeded in stabilising exchange rates and reducing bad debt.

The household poverty rate was cut down by 1.83 percent nationwide and 5.61 percent in deprived districts during the year, he noted.

Phuc also underscored socio-economic highlights in the first four months of 2015, with a low consumer price index. Notably, GDP in the first quarter grew at 6.03 percent – a five-year high - of which the industry and construction sectors hiked 8.35 percent.

Meanwhile, an array of difficulties faced the agriculture sector, which expanded at a slower pace than the same period last year, the Deputy PM said. He pointed to acute droughts across Vietnam, especially in the southern central and Central Highlands regions.

He also noted problems facing the country. He criticised the sluggishness of several ministries and localities in improving local business environments, bemoaned the national economy’s low competitiveness, and warned about the slow recovery of the stock and property markets. He also revealed that the number of companies that were dissolved or suspended their operations in 2014 increased by 4.5 percent from the year before.

At the opening session, Chairman of the NA Committee for Economic Affairs, Nguyen Van Giau, asked the Government to make drastic improvements to scientific and technological application in production and business activities and the training of skilled labourers.

More efforts are also needed to implement the new-style rural area building programme, create a fair competition environment, ensure the budget for social welfare and increase the State management of national security and social order issues, he added.

Timber furniture industry facing tougher market

Vietnam's timber and timber product exports are up, but the domestic market is buying foreign imports, due largely to a lack of planning and product diversity.

Exports of timber and timber products rose 5.5 percent in the first quarter on a year earlier to USD1.52bn. But locally made furniture accounts for just 20 percent of sales in Vietnam.

Vo Van Quyen, in charge of domestic trade affairs at the Ministry of Industry and Trade, said Vietnam has 4,000 manufacturing facilities, mostly small-scale, with 340 traditional villages, specializing in making timber furniture.

The Handicraft and Wood Industry Association (HAWA) of Ho Chi Minh City said domestic makers are facing increasing difficulties as Vietnam joins trade pacts lowers import duties in line with its obligations under ASEAN trade integration next year.

Huynh Van Hanh, deputy head of HAWA, said, "This is a warning bell. Companies should make plans and find ways to make a strong impression in the marketplace with brand recognition for customers or they'll lose in this integration era."

He said there was a lot of potential in domestic markets, but companies lacked professional distribution, product diversity and brand recognition.

The Vietnam Wood and Wood Product Association said 26 countries are planning, or have made moves, to invest in the timber furniture industry, including China, Thailand, Japan, South Korea and the UK.

Nine enterprises sued for social insurance evasion

HCMC Social Insurance agency has taken legal proceedings against nine enterprises in the city for evasion of social insurance premiums. The HCMC People’s Court will hear the lawsuit.

The enterprises owe nearly VND1 billion each in social insurance premiums despite several warnings from the agency, said Cao Van Sang, director of the agency. Such violations result in many disadvantages for laborers.

Punitive measures amount to a slight VND20 million fine for each enterprise. “The companies may pay the fine and continue to evade social insurance premiums,” Sang said.

Ailing companies were advised by the agency to ask for interest free loans from Vietnam Development Bank to pay the premiums and worker salaries following the Government’s support policies.

The agency asked relevant district level departments to sue companies that owe social insurance premiums amounting to over VND100 million. It also asked the courts to dispose of the case within two months.

“Some enterprises hire a lawyer to prolong the case and insurance payment, which will worsen the disadvantages of laborers,” Sang explained.

The nine enterprises, seven from South Korea, one from Taiwan and one from Singapore, owe over VND5 billion in social insurance premiums. The social insurance premium arrears in the city total around VND80 billion.

The agency took similar legal action against eight companies last year. Four of them have yet to pay their debts but their leaders have disappeared.

Metropolitan building seen becoming all foreign-owned

 The Metropolitan Building, opposite Notre Dame Cathedral in downtown HCMC, can become 100% foreign-invested, according to recent approval by the city government.

City chairman Le Hoang Quan last week approved in principle to allow Saigon Construction Corporation, a local partner of the building’s joint-venture developer, to transfer its stake to the foreign partner, according to the city’s website. It is said the city authorities will meet with the foreign partner to negotiate conditions, including pricing.

The building has been invested by Saigon Metropolitan Tower Limited, a 40-year joint venture between Binh Minh Construction One-Member Co. under Saigon Construction Corporation and Saigon Metropolitan Limited of the British Virgin Islands.

When established in 1995 with registered capital of US$29 million, the local partner was Construction and Building Materials Co. After several changes, the project now has registered capital of US$49.7 million and its local partner is Binh Minh Co. with a 30% stake.

Located at 235 Dong Khoi Street in District 1, the Metropolitan Building was completed in 1997 as a 16-story building with 15,000 square meters of office space. It has attracted multi-national companies such as HSBC and Toyota.

* Broker and consultant Vietnam Finance Investment Co. (known as TigerInvest) has announced it successfully transferred an office building in HCMC owned by Viet Technology Joint Stock Company, VITEK, to another local company.

Accordingly, VITEK has signed a contract to transfer the 10-story building covering 4,350 square meters at 63A Vo Van Tan Street in District 3 to Bitexco Nam Long Manufacturing and Investment Joint Stock Co. The contract is valued at VND135 billion.

TigerInvest specializes in supplying M&A package services, especially in real estate.

Last month, TigerInvest successfully transferred the Hoa Binh Tower of Hoa Binh Real Estate Construction and Trading Joint Stock Co. (HBC) to another local company.

The transfer contract for Hoa Binh Tower, which covers 2,775 square meters in the city’s Saigon South, is worth nearly US$12 million.

SAPro to apply new model for tourism property

Saigon Phuong Nam Property Corporation (SAPro) says it will apply a new method called Vacation Ownership to the property complex Sea Links Golf Resort in the coastal resort town of Phan Thiet in an effort to boost business for tourism property projects.

Le Minh Tri, general director of SAPro, a member of the Rang Dong Corporation which is the complex project owner, told the Daily that the company would issue Vacation Ownership cards next month, targeting local travelers and expatriates who plan to travel every year.

Tri said the company would issue 500 to 1,000 cards whose values range from US$12,000 to US$15,000 each. Card holders are entitled to spend a week in a 300-square meter villa of the resort each year for the next 20 years and may choose any week of the year.

Tri said Sea Links Golf Resort would be linked to other resorts around the world through the Resort Condominium International (RCI) which is an organization for room exchange. RCI will function as a bridge to help holiday-makers take their week-holiday trips to other countries for free.

According to RCI, there are some three million members and 4,000 resorts worldwide in the system. Among Asian countries, Japan, Malaysia, Korea and India top the list of countries applying for Vacation Ownership.

Tri noted that regulations permitted a card holder to bring five family members on each trip. For example, with a US$12,000 card, the holder would spend US$600 a week for his holidays over 20 years. But a three-bedroom villa for six holiday-makers would come to only US$86 per night, or about US$14 per person.

SAPro said card holders could resell, rent or give away their cards.

The company also said Vacation Ownership is a solution for tourism property projects which face a dim outlook due to the global economic downturn.

Most tourism projects on the coast are finding it hard to sell luxury villas which are worth tens of thousands, even millions, of U.S. dollars each.

Small-cap firms to move to northern bourse

Up to 21 firms listed on the Hochiminh Stock Exchange will move to the Hanoi Securities Trading Center within the next three months as they cannot satisfy the requirement for minimum chartered capital as regulated in a new decree.

Nguyen Son, head of the securities market development department under the State Securities Commission, confirmed the number at a conference in Hanoi last week, saying that those listed firms failed to raise capital to over VND80 billion as required in Decree 14/2007/ND-CP guiding the implementation of the Securities Law.

Under the decree, two years after the Securities Law took effect or from February this year, listed firms trading shares on the Hochiminh Stock Exchange must have at least VND80 billion in registered capital, while the level for firms on Hanoi’s bourse is VND10 billion. However, SSC early this year gave six months to enterprises to either spur capital or change bourse.

There are 30 firms on the southern bourse and about five on Hanoi bourse failing the capital level requirements. Tran Van Dung, director of Hanoi Securities Trading Center, said some firms on the northern bourse had registered to increase capital as regulation, while the remainder will shift to trade shares on the market for unlisted public companies (UPCOM) expected to open in June.

As UPCOM has yet to be launched, those firms will temporarily continue trading shares on the northern bourse, Dung said.

Banks race to mobilize money

Commercial banks in the country have pushed up issuing valuable papers with high interest rates to mobilize medium and long-term funds as demand for credits is soaring under the Government’s subsidized lending policies.

While large credit institutions are well-prepared for their issues and have launched many products to draw medium and long-term capital, smaller banks are hesitant about the lending program as they often mobilize 80% to 90% short-term capital.

Vietnam Bank for Industry and Trade, or VietinBank, on Wednesday issued certificates of deposit with interest from 7.9% to 9%, one percentage point higher than other banks. The total value of the issue is VND6 trillion for five terms of six, nine, 12, 24 and 36 months.

However, the bank has regulated certificate bearers not to withdraw money before maturity. The central bank has approved VietinBank to issue VND10 trillion of debt in 2009.

Bank for Investment and Development of Vietnam has issued deposit certificates for one, two, three, and five year terms with this year’s interest rates of 8.2%-8.6%. Saigon Thuong Tin Commercial Joint Stock Bank, or Sacombank, also plans to issue convertible bonds to mobilize medium-term capital.

Do Minh Toan, deputy director of Asia Commercial Bank (ACB), said ACB would set aside around VND10 trillion for long-term credits for big enterprises but may provide VND6 trillion more from funds that were earlier used for loans to small and medium enterprises, for medium-term credits. ACB was recently allowed to issue VND11 trillion of debt this year.

Nevertheless, the smaller DongA Bank has only secured 40% of its short-term capital need to serve medium and long-term credits following central bank regulations. “Issue of valuable papers must offer high interest, thus there are risks,” said the bank’s deputy general director Nguyen Thi Kim Xuyen.

If the Government continues to slash interest rates, banks will incur losses with medium or long-term loans as capital is mobilized at high rates, Xuyen explained. In addition, it is hard for commercial banks to find projects which are feasible enough for medium and long-term loans.

Nguyen Thi Tam, deputy general director of Vietnam Technological and Commercial Joint Stock Bank, said only 30% of the bank’s short-term capital would be used for medium and long-term credits. Though demand for long-term credits increased after the real estate market recovered, Techcombank has yet to prepare for the lending program, Tam said.

PVEP starts 2D seismic survey of central coast

The HCMC branch of PetroVietnam Exploration Production Corporation, or PVEP, has opened a 2D (two-dimensional) seismic survey of the central costal region to serve oil and gas exploration and exploitation.

PVEP has sent in the Panama-flagged 2D seismic investigation ship, named Seabird Aquila Explorer, and four escort ships to carry out the project off Binh Dinh, Phu Yen, Khanh Hoa and Ninh Thuan provinces. The Seabird measures 70 meters in length and 17 meters in width and will carry a six-kilometer seism cable through the sea from April 15 to May 31.

Binh Dinh Province authorities on Thursday asked relevant departments to inform local fishermen of the survey and ask them to yield to PVEP’s fleet.

Furniture producers lack orders

Many local wooden furniture producers are scaling down production due to a sharp fall in orders from customers, said the Handicraft and Wood Industry Association of HCMC (Hawa).

Some are almost out of business while many lack orders for the second haft of the year, said Hawa vice chairman Tran Quoc Manh at a seminar in HCMC on Thursday on how to cope with difficulties in the furniture sector.

Manh said Hawa members had been hit hard as world demand was dwindling as a result of economic recession.

Vietnam now has some 2,530 wooden furniture makers, 80% of them in the southern region, and they employ some 170,000 people, according to him.

He told the seminar, which was organized by the Vietnam Trade Promotion Agency (VietTrade) and Hawa, that most producers were still using outdated technologies, or lacking coordination to create a supply chain in foreign markets.

Hawa figures put Vietnam’s wooden furniture export revenue at US$2.8 billion in 2008, and it is expected to rise to US$3.2 billion this year but this appears to be unattainable as the first quarter of the year saw furniture shipments down by 26%.

At the seminar, wood processors catalogued their difficulties and called for the authorities to help them out of the situation.

Some small and medium wood processors complained that they were finding it hard to access bank loans with four-percentage-point interest rate support from the Government.

Others said foreign importers required them to document the origin of their materials by producing certificates of forest protection from the Forest Stewardship Council (FSC), a non-profit organization devoted to encouraging the responsible management of the world’s forests.

They said it was expensive to apply for such a certificate from FSC while Vietnam lacked standards to authorize certification of forest protection. Lack of this certification is causing difficulties for domestic producers to export their wooden products to Europe, the U.S., Korea and other potential markets.

It is harder for producers to prove this because 80% of materials are imported from other countries, the vice chairman of Hawa told the Daily.

“Since early this year, most of my clients who are the U.S. wooden furniture importers have asked me to show the certificate of forest protection to prove the origin of our products, but I could not meet this requirement,” said Nguyen Xuan Vinh, general director of Nguyen Gia Wood Furniture.

Manh said Hawa had proposed the Ministry of Agriculture and Rural Development and the Ministry of Industry and Trade set standards for issuing this certification for Vietnam’s producers.

Aussie business leaders gauge Vietnam market

Australian business leaders from the Asia Society AustralAsia Center on Thursday joined a video teleconference with Vietnamese executives to look for what Vietnam has to offer, and cannoned their attention to the shortage of electricity in Vietnam among other issues.

The video conference was held between Hanoi and HCMC to provide Australian business executives – currently touring Hanoi – a glimpse of existing opportunities ahead of their participation in the Asia Society’s 19th Asian Corporate Conference in HCMC next week.

As many questions were raised about electricity issues in Vietnam, local counterparts took the occasion to brief them of the situation.

Pham Thi Loan, chief executive officer of Viet A, pointed out electricity was a major concern of companies operating in Vietnam and one of the key challenges to the country’s development.

Due to the shortage of electricity in Vietnam, the electricity sector has to apply power cuts for certain periods across the country, especially during peak hours in the dry season, Loan responded to a question from the Australian delegation.

She explained Vietnam had called for foreign companies to invest in power projects, but such projects were unattractive since the selling price was somehow below production cost.

However, Loan said the Government recently allowed an increase in electricity retail prices as one of the moves to make Vietnam’s power market attractive so that foreign companies could invest in.

“The market is still open and the growing demand is a good opportunity for foreign investors,” Loan said.

Nguyen Chi Dung from Hung Viet Co. said in support of Loan and estimated that the demand for energy increased around 10-15% every year in the past years.

Sources said as Vietnam’s economy had developed rapidly in recent years, the energy sector was struggling to meet the booming demand for electricity. Last year, Vietnam’s power demand grew 16% while the supply rose by only 12%, forcing the country to import electricity to quench the shortages.

Dang Dung, chairman of Hung Viet Co., said that opportunities were waiting for Australian and Vietnamese companies to cooperate on education, banking and finance, mining and other business spheres.

Charles Goode, chairman of ANZ Bank, said retail banking, foreign exchange and distribution were among the areas in Vietnam that the bank had keen interest in.

Australian and Vietnamese business executives also spent time discussing the potential for cooperation on human resource development, environmental issues in Vietnam, and the opportunities for Vietnamese companies to invest and do business in Australia.

The Australian delegation arrived in Vietnam to gauge and explore this growing market as well as to participate in Asia Society’s 19th Asian Corporate Conference due to take place in HCMC from April 22 to 24.

KBC builds budget homes for workers

Kinh Bac City Development Shareholding Corporation (KBC) on Thursday broke ground for a large-scale residential area with an aim to develop low-cost housing for lease and sale to workers and low-income people in Bac Ninh Province.

The project site is located along Road No.18 at Phuong Lieu Commune near Que Vo Industrial Park in the northern province, said Dang Thanh Tam, chairman and CEO of KBC, which is the developer of Que Vo IP and several real estate projects.

The construction density is 50% on the project site of six hectares. KBC will spend VND1.5 trillion, or some US$85 million, developing buildings with an average height of ten floors, supplying 300,000 square meters of floor space equivalent to some 8,000 apartments.

Tam said the budget homes of different types and sizes would either be leased to managerial officers or workers, or sold to them by installments, which he said would be affordable to low-income workers.

Although branded housing for low-income earners, the develop still sets up auxiliary works and standardized supportive areas to meet the buyer’s demand. Included in the project will be supermarkets, clinics, kindergartens, and entertainment centers, he said, adding the project targets workers in Que Vo IP.

Apart from meeting the demand of local and immigrant workers, the project will also address potential social issues that may be triggered by the shortage of accommodations, especially for provinces where investment is increasing strongly like Bac Ninh, he said.

“If there timely measures are not taken, social issues will arise, which will cause problems not only to the employees but also to the local authorities, especially to those provinces that attract a lot of industrial park developers like Bac Ninh,” Tam told the Daily.

According to the developer’s surveys, most immigrants working for the IP have to rent houses in the surrounding areas that are usually below the minimum standards, causing environmental sanitary problems for the surrounding areas and their health. Moreover, with such low income and tough living conditions, employees have no chance for entertainment, relaxation, exchange and study.

KBC has set forth reasonable rents so that employees can buy the apartment by installments, Tam added. A 40-square meter flat will be priced at some VND200 million.

At the ceremony, KBC also signed a contract on leasing apartments to Yamato Industry Vietnam Co., Ltd, a Japanese enterprise investing in Que Vo IP. The enterprise rents the houses for its employees to help them have stable, qualified housing suitable with their income, said Tam.

Yamato has invested US$10 million to build a factory producing cables for the automobile assembling industry. It has plans to put the factory into operation in the middle of this year with 500 officers and workers.

KBC expects to finish the infrastructure system for the residential project within five years.

Currently, Que Vo IP has nearly 60,000 workers employed by some 60 enterprises.

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