Restructuring SOEs while developing a market economy

Over the past few years, Vietnam has been restructuring its state-owned enterprises (SOEs) in accordance with the market mechanism.

A number of enterprises have been equitized, but the equitization process has been slow and sometimes wasteful. Drastic measures are needed to make it more efficient.

Since the renewal process began more than 30 years ago, SOEs have gone through successive periods of restructuring and the number of SOEs in which the state holds 100% of the charter capital has dropped from more than 12,000 in the late 1980s to about 620 as of the end of 2015.

During the 2011-2015 period, equitization and divestment retrieved nearly US$3.4 billion for the State budget. But the restructuring process has been slow, and the efficiency of SOEs remains low considering the resources they have. That is not to mention that many SOEs have invested outside of their core business, causing waste and inefficiency which has led to capital losses.

To address the issue, the Vietnamese government has implemented drastic measures to reorganize and accelerate equitization of SOEs, with top priority given to improving the capital management of SOEs.

The most urgent issue is to choose an appropriate capital management model that keeps the State from having to interfere unduly in the operation of the SOEs.

Economist Nguyen Cong Nghiep said, “The model for managing state capital in these enterprises must be appropriate for a market economy. Government intervention into businesses’ investment activities needs to be avoided. SOEs currently account for more than 30% of national GDP. If the State capital in enterprises is reduced to 10% of GDP, management will be simpler.”

The Vietnamese government is committed to restructuring SOEs for greater efficiency and sustainable development in line with the current international economic integration. To that end, enterprises must be streamlined, productivity improved, costs reduced, and brands built up to increase competitiveness.

Nguyen Quang Vinh, Deputy Secretary General of the Vietnam Chamber of Commerce and Industry, said, “A sustainable enterprise is sustainable economically, socially, and environmentally. To develop sustainably an enterprise must make a profit, but that profit must be associated with social and environmental progress. A sustainable enterprise should combine technological solutions with stability in social and labor relations.”

240 SOEs need to be restructured or equitized between now and 2020. By then, the State will hold 100% of charter capital in only 103 SOEs and will make them operate efficiently.

SolarBK greening out logistics industry

Vietnam’s first solar-powered green logistics centre, Tan Cang-Song Than ICD, is slated for completion in September 2017 and is expected to contribute to the sustainable development trend in the domestic logistics industry.

Solar ESCO JSC, a member of Vietnamese renewable energy firm SolarBK, and Tan Cang-Song Than ICD signed the contract to lease the solar system to ICD Song Than Logistics Center in the southern province of Binh Duong, with a total capacity of 500.96 kWp.

Under the agreement, Solar ESCO JSC would invest in the solar power system being installed by SolarBK at Tan Cang-Song Than ICD.

This solar-powered model is not only economical but also contributes to environmental protection, helping to reduce CO2 emissions by 518.5 tonnes a year.

Nguyen Thanh Son, director of Tan Cang-Song Than ICD said, “the trend of green logistics has been developing globally for many years, and customers increasingly attach environmentally friendly clauses to business contracts.”

He added that they always expect a holistic solution that can solve both economic and social responsibility issues. On this basis, they found that SolarBK provides tailored solutions to these issues.

In this solar grid solution, SolarBK will provide 1,616 IREX solar panels with a total system peak power of 500.96 kWp. Accordingly, the system will generate about 784,218 kWh of electricity annually. To supply stable power for warehouse service, SolarBK has carefully calculated the optimal settings thanks to its previous experience in implementing large projects.

SolarBK is the leading provider of renewable energy solutions in Vietnam, with a wide range of internationally-certified products exploiting wind and solar energy. It is gearing up efforts to extend the list of solar systems implemented in Vietnam, promoting cleaner and greener development.

Getting ready for the age of robots taking over factory jobs

The prediction of experts at a recent dialogue in Hanoi discussing the fourth industrial revolution is that the factories of tomorrow in Vietnam will be filled with vast armies of robots doing the work once done by humans.

Driven by a desire to reduce high labour costs and replace it with inexpensive automation, factories around the globe are already beginning to see a rapid rise in the number of robots on assembly lines, they said.

It’s a trend most noticeable in China but one that will surely continue to gain ground and take over the industrial and manufacturing landscape of tomorrow, from the emerging economies in Southeast Asia to most the modernized industrial countries such as those in the US and Japan.

The point, said one expert, is that one of the comparative advantages of Vietnam is its deep pool of relatively lower labour costs. But with this trend in automation that advantage could likely be wiped out by as early as 2020.

One of first unmanned factories in China has reportedly already replaced 600 workers at a mobile phone maker with robots. Out of a total of 660 workers now only 60 jobs remain. That’s more than a whopping 90% cutback in jobs.

Even more startling are the claims by the Chinese mobile phone maker that productivity has increased by 250% and product defects have dropped 80%.

Deputy Minister Nguyen Van Thanh of Public Security said this phenomenon has particularly far reaching implications for the clothing, textiles, leather and footwear segments.

According to International Labour Organization figures, Mr Thanh noted that there are 9.2 million Vietnamese workers in these segments and two-thirds of them are at risk of losing their jobs to robots.

According to the ILO, jobs for as many as 86% of workers in on the clothing segment are threatened, he emphasized. Moreover, the employment of millions of workers in the telecom, banking, insurance and securities segments is threatened as well.

Representatives of the Ministry of Labour, Invalids and Social Affairs echoed Mr Thanh’s sentiments, noting that robot technology will force many local companies to shutter their doors over the next decade if remedial action isn’t successfully undertaken. 

First, they said, local companies need to focus on increasing labour productivity and automation, particularly in manufacturing. Secondly, they need to raise the investment in human capital to create value.

The national plan of Vietnam manufacturing is not to become and stay a low-cost manufacturing hub, which is the low end of the ladder. But rather the end goal is to move up the ladder to high value-added, high-end manufacturing.

To transform Vietnam into such a global manufacturing powerhouse in the fourth industrial revolution, Vietnamese factories need to climb the ladder and be at the forefront of automation.

Human labour in Vietnam cannot stay as inexpensive as it is today and remain on a level competing with low end rival manufacturing hubs Cambodia, Thailand and Indonesia.

Manufacturers in Vietnam must plan to transform their production processes using robotics and automation as well as invest in human capital and innovation on an unprecedented scale.

Automation and other innovative technologies must be applied in all manufacturing facilities in the country to maximize efficiency and to carry out every conceivable repetitive task with the end goal of continuously enhancing the quality of products.

And through training, said the Ministry representatives, in line with a national strategy, fewer workers can focus on higher value-added elements in the manufacturing process, such as research and development in addition to quality control.

As part of the national strategy, manufacturing processes and products will become more technologically advanced with automation playing an all-encompassing role with Vietnam at the vanguard of the fourth industrial revolution.

Vietnam opens first functional food factory that meets European standards

Officially inaugurated and operated on May 14, the functional food factory, invested by Savipharm Joint-Stock Company, uses dust-free, non-exposure technology, and is controlled using Scada system.

The factory, equipped with modern facility, has the capacity of supplying 500 million pills per shift per year, and can produce various forms of medicines, including film-coated tablets, sugar-coated tablets, hard gelatin capsules and effervescent tablet. 

Savipharm’s factory meets all standards to produce healthy functional foods that have the same quality with imported products.

According to Savipharm’s director, Tuu Tran, the company is willing to cooperate with domestic functional food companies to develop and create high quality products; it is also willing to cooperate and licensing the factory to foreign companies; and it can handle producing and processing functional foods for domestic and foreign companies. 

Savipharm also aims toward exporting high quality functional food products to the international market.

In Vietnam, the functional food industry has been growing strong for the last 15 years, with more than 20,000 approved products and more than 4,000 manufacturing companies. Approximately 50% of the urban population use functional foods regularly.

Also during this event, Savipharm opened two new assembly lines that will modernize the Pharmaceutical Factory, better manage medicine quality, and better protect workers’ health. Earlier, Savipharm had operated pharmaceutical factory that meets the quality standards of GMP Japan and GMP PIC/S.

Savipharm was founded on August 2015. It operates in three main sectors: (1) producing medicines and medicine-related products, (2) storing and distributing medicines, and (3) participating in research, development and training. Regarding revenue and quality, Savipharm is one of the top 10 leading pharmaceutical firms in Vietnam.

Fitch revises up Vietnam's credit rating

Fitch Ratings has moved up the outlook on Vietnam's long-term foreign-and local-currency issuer default ratings (IDRs) from stable to positive and affirmed the ratings at ‘BB-’.

The ratings on Vietnam's senior unsecured foreign-and local-currency bonds were also affirmed at 'BB-'. The country ceiling stands at 'BB-' and the short-term foreign-and local-currency IDRs at 'B'.

Vietnam’s ratings reflect strong growth performance and prospects, persistent current account surpluses, manageable debt service costs and sustained foreign direct investment (FDI) inflows.

Explaining its revision of Vietnam’s outlook to positive, the New York-based credit rating agency said the country is building a record of policy-making focused on macroeconomic stability. This approach, which includes greater exchange-rate flexibility and an increasing focus on inflation stability, has supported consistently strong levels of FDI and helped maintain robust economic growth.

Vietnam’s economy expanded by 6.2% last year, taking the five-year average gross domestic product (GDP) expansion to 5.9% against the 'BB' median of 3.4%.

Growth remains supported by the country's export-oriented manufacturing sector and steady expansion in services, despite weakness in the mining and quarrying sectors from the ongoing oil and gas industry downturn.

Fitch expects real GDP growth to improve gradually over the forecast period to 6.3% this year and 6.4% next, supported by continued FDI inflows into the manufacturing sector and strong private consumption expenditure.

As for the 'BB-' rating, it said Vietnam’s government debt is above the 'BB' median and has continued to rise.

According to preliminary estimates by the authorities, government debt accounted for 53.4% of GDP at the end of 2016, rising from 50.1% the year before. 

Retail giant Lock & Lock introduces new product line in Vietnam

Iconic brand Lock & Lock known for its innovative and airtight food containers held a grand opening to introduce its newest product line – P&Q (Price and Quality) – on May 19 at its store in Ho Chi Minh City, VnExpress has reported.

The new line of daily necessities, stationery, fashion accessories, toys and souvenirs are both safe and convenient to use, said Lock & Lock representatives at the grand opening, adding that they have been thoroughly tested and pose absolutely no health hazard to customers. 

Lock & Lock’s movement to go beyond containers, quality cookware and glassware, and now offer daily necessities is our response to Vietnamese growing concern for their health combined with their need for convenience in all facets of daily life.

Through this new P&Q lines, we harness technology to be able to create innovative products that can quickly and conveniently create healthy meals as well as lifestyles for the entire Vietnamese family, the representatives shared.

Kien Giang branches out marine economy

The marine economy has potential for the Mekong Delta province of Kien Giang financially and can contribute to protecting national sea and island sovereignty.

According to Chairman of the provincial People’s Committee Pham Vu Hong, the province has integrated sea economy development with ensuring defence.

In addition to fulfilling its potential, the province has cooperated with regional countries to improve seafood management, protection and exploitation.

Developing hi-tech fishing teams and constructing sea ports and fish markets in the locality are key goals, he said.

To enhance local fish farming efficiency, the province aims to set up strong seafood enterprises, plan marine economic activities and zone off areas for local processing businesses.

With 200 kilometres of coast ideal for developing the fisheries sector, the province has seen annual growth of 5.24 percent in seafood exploitation. It produces 200,000 tonnes of seafood in an area of 2,200 hectares and earns 147 million USD in export revenue every year.

Local brands offer affordable, high-end children’s clothing

Vietnamese brand names and clothing shops in HCM City are offering new collections for the style-conscious young consumer this summer. 

Designers for Kim, a brand name owned by designer Phúc Trần, combine simplicity and practicality at their shops in District 3.

They offer a new collection titled My Summer for boys and girls aged 10 to 14, using pastel, neon, black and white on cotton, linen and denim.

With more than 40 designs this season, Kim’s items sell from VNĐ200,000 (US$9) to 500,000 ($22).

Limited edition items for children under 12 years old are from Kelly Bùi Kids, owned by female designer Bùi  Minh Trang.

Sold in shops in Hà Nội and HCM City, they provide a taste of animated Hollywood film characters.

Featured clothes are on quality materials like lace, silk and taffeta, printed with Ninja turtles.   

The designs go with accessories such as belts, sunglasses, gloves and fishnet socks. 

“Clothes from Kelly Bùi are high-end and pricey, over VNĐ1 million ($45) each, but customers with deep pockets are satisfied,” said regular customer Trần Ánh Tuyết, mother of son and two daughters.  

“I like clothes by Vietnamese fashion designers like Kelly Bùi and Phúc Trần because they give my children a trendy outlook suited to their age,” she added. 

Other fashion shops have also upgraded their goods. Phương Nguyen Silk and Rabity offer ready-to-wear collections for boys and girls.  

While Phuong Nguyen Silk’s popular clothing line starts at VNĐ200,000 ($9), Rabity’s customers should be prepared to pay VNĐ300-1.2 million ($25-$100) per item.

In their collection called Summer Garden, Rabity uses silk and satin to highlight the innocence of children who look beautiful in white and cream.  

Phuong Nguyen Silk uses cotton and khaki and embroidery in hot colours, such as pearl blue and lemon green, to launch a trend of simple, high-end styles.

A full range of accessories of handbags, scarves, swimwear and jewellery made by local craftspeople are also offered.

According to a representative of Kelly Bùi, to satisfy the needs of the market in summer, domestic brandnames are also spending more to grab the attention of children and their parents.

They have also worked to ensure their services and promotions are the best for customers.

“We plan to launch an online service in the near future,” she said.

Xuân Lan, a member of the second Vietnam Junior Fashion Week 2017 (VJFW)’s organising board, said: “Vietnamese fashion houses, companies and designers have worked to develop their business in children’s clothing in recent years.”

“Our two-day VJFW 2017 in March featured 90 amateur fashion models aged from four to 13, who wore more than 100 designs offered by foreign and domestic brandnames in HCM City,” she said.

Several thousand parents and children shared their comments on the event’s websites and online forums.

“We have worked with dozens of foreign and domestic fashion companies to organise the VJFW each year,” Land said.

Lan owns CA3, an institute of modelling and acting, which offers training courses for fashion modelling, catwalk and photography.

“We will seek new talents for the catwalk through the VJFW. We will help them become more professional in their work in the future,” she said. 

Quang Ninh builds high-quality shrimp breeding complex

The northern province of Quang Ninh has began building a high-quality shrimp breeding and aquatic processing complex in Dam Ha district.

The project, worth 500 billion VND (22.03 million USD), was funded by the Vietnam-Australia Corp, a strategic partner of Quang Ninh.

The complex covers some 187 hectares in Tan Lap and Dam Ha communes and includes a shrimp breeding area, a food manufacturing plant, a hi-tech intensive shrimp farming greenhouse, and a shrimp processing plant for export.  

It is expected to produce about 5,800-17,400 tonnes of commercial shrimp per year. 

The project is divided into two phases, focusing on building technical infrastructure, commercial shrimp breeding areas and waste treatment plants, among others. 

The Vietnam-Australia Corp aims to use advanced technologies to increase added value and ensure sustainable development for the seafood industry. 

The project is part of a research cooperation deal between the group and Quang Ninh authorities. 

It aims to turn Quang Ninh into a shrimp development centre of the north. 

Chairman of the provincial People’s Committee Nguyen Duc Long said the project also aims to provide safe and hygienic shrimp varieties for local farmers, as well as northern localities and Chinese border provinces.

Customs to cut clearance time     

The customs authority has striven to shorten the time for carrying out customs clearance of goods across borders to 70 hours for export goods and 90 hours for import goods by the end of this year.

The General Department of Customs (GDC) on Wednesday said in its report that the authory would continue its renewal and modernisation process while reducing paperwork and cost of administrative procedures to follow Government’s Resolution No 19-2017/NQ-CP on improving the business environment and enhancing national competitiveness in 2017 and orientation to 2020.

Accordingly, the time for customs clearance of goods across the border would be shortened to 60 hours for export goods and 80 hours for import goods by 2020.

The set targets were much higher than those of 2016, requiring the sector to make greater efforts.

According to the Viet Nam Logistics Association’s (VLA) statistics in 2016, the time to clear exports is still high -- up to 108 hours -- and 138 hours for imported goods.

The GDC will also improve all of its online public services to level 3, which allows applicants to fill and submit forms online. Some 70 per cent of its key services would move up to level 4, which allows them to not only submit required forms but also make payments and receive results online.

In addition, the authority will continue to complete its Viet Nam Automated Cargo and Port Consolidated System/Viet Nam Customs Information System (VNACCS/VCIS) and will prepare for the second phase of the system as soon as it receives approval from the Japanese government.

It will also submit to the Government a proposal for the building of a national one-stop-shop mechanism, ASEAN one-stop-shop mechanism and special checks to create favourable conditions for import-export products.

In the report "Assessing the reform of customs procedures: the satisfaction of enterprises in 2016," conducted by the Viet Nam Chamber of Commerce and Industry, some enterprises said the inspection has resulted in too many overlapping legal documents. Further, there was no close coordination between the customs and specialised management agencies and too many licences are required.

It was the reason the GDC was co-operating with relevant ministries to promote socialisation of special checks on import-export goods to meet the set targets. 

VNA launches daily HN-Dong Hoi flights     

National flag carrier Vietnam Airlines (VNA) will work with the Viet Nam Air Service Company (VASCO) to operate two daily flights connecting Ha Noi and Quang Binh Province from May 29, the carrier announced on Thursday.

The VNA flights, using Airbus A321s, will take off at 6:30am from Ha Noi and 8:30am from Dong Hoi City.

Meanwhile, passengers on ATR72 aircraft, operated by VASCO, will leave Ha Noi at 2:30pm and Dong Hoi at 4:30pm.

Promotional air fares on the route, priced from VND299,000 (US$13.2), are available for flights departing between May 29, 2017 and March 31, 2018.

Earlier in March, Vietnam Airlines transferred the Ha Noi-Dong Hoi air route to VASCO to operate seven round trips per week, using the 68-seat ATR72 aircraft. The move is part of Vietnam Airlines Corporation’s plan to improve operational efficiency of its subordinate airlines -- Vietnam Airlines, VASCO and Jetstar Pacific Airlines -- and expand VASCO’s business to meet increasing demand.

Vietnam Airlines has, so far, transferred the HCM City- Rach Gia-Phu Quoc, HCM City-Phu Quoc-Can Tho and Ha Noi-Dien Bien flights to VASCO. Meanwhile, air routes between Ha Noi/HCM City-Tuy Hoa and HCM City-Chu Lai were transferred to Jetstar Pacific Airlines. 

Viet Nam Airlines offers cheap tickets to Hong Kong     

Viet Nam Airlines has launched a special offer on HCM City-Hong Kong flights, with a round-trip ticket costing only VND2.35 million (US$104).

Tickets are being sold and valid from now until December 31.

The route is operated by Airbus A321 with international four - star service quality, and is completed in 2 hours and 45 minutes.

Being one of the Asia’s leading financial and shopping hubs, Hong Kong is known for its dynamism and popular attractions such as the Disneyland, Sky Tower, the Peak and Star Avenue. 

Vissan buys more pigs to support cash-strapped farmers     

To reduce oversupply and help farmers, Vissan Co. Ltd will buy and slaughter an additional 200 to 300 pigs a day, raising the company’s additional purchases over the normal number to 500-600 pigs a day.

Speaking at a meeting with the media in HCM City on May 18, Nguyen Ngoc An, the company’s general director, said the move had raised the total number of pigs slaughtered at its facilities to 1,600-1,800 a day.

The company will use cold warehouses of APT Logistics and SATRA to freeze the additional pork, he said.

Nguyen Phuc Khoa, Vissan’s chairman, said his company had stopped pork imports since February and had increased local purchases.

The pigs meet VietGap standards, or are bred under the Livestock Competitiveness and Food Safety Project (Lifsap), and are from farms participating in a HCM City programme to trace their origin, he said.

To stimulate demand, Vissan will continue to offer 10-15 per cent discounts on certain pork products at Saigon Co.op’s outlets, Vinmart, Vinmart+ and other supermarkets, that sell its pork products.

In addition, it will cut prices by 5-10 per cent on some processed food.

The price of live pigs has dropped sharply because of oversupply, causing big losses for farmers. 

Thanh Hoa promotes inclusive growth     

Thirty two projects with a total investment of more than VND135.3 trillion (US$6.1 billion) in Thanh Hoa Province were granted licences at the province’s investment promotion conference held in Sam Son on Thursday.

The major investment promises to turn the north central coastal province into a destination for huge projects, mainly in the manufacturing and processing industries, urban development and tourism.

“With its ample advantages, Thanh Hoa should work to become a model to attract investment,” Prime Minister Nguyen Xuan Phuc said.

The PM described Thanh Hoa as a miniature Viet Nam, with a dynamic economy full of potential. He urged hastened efforts to improve the investment environment and to ensure a level playing field for businesses, creating favourable conditions for firms to operate at low land-use costs and with simplified administrative procedures.

He also agreed with local plans to develop oil refining, aquatic processing and tourism. The PM suggested studying the development of hi-tech agriculture and focusing on products with high economic value.

He encouraged businesses to invest in agriculture and infrastructure while diversifying services and taking advantage of heritage sites such as Ho Citadel and Lam Kinh historical relic site, as well as community-based and craft village tourism.

Phuc said at the event that to increase enterprises’ competitiveness and to build a strong business community, the province should train skilled workers, help businesses make long-term investments and join the global value chain.

He noted that the province could not pursue business at any cost but instead must pay special attention to protecting the environment.

“The Government will provide opportunities for Thanh Hoa to become an exemplary locality to achieve its investment targets,” Phuc stressed

Various Government projects are planned for the province, such as the Ha Noi – Thanh Hoa – Nghe An expressway, a coastal route to prevent natural disasters, and upgraded seaports and airports.

“With determination and innovation in thought and action, Thanh Hoa will succeed in achieving inclusive growth,” Phuc said.

Chairman of the provincial People’s Committee Nguyen Dinh Xung said that Thanh Hoa will apply preferential policies and investment incentives at the highest level for investors.

“Investors will enjoy the highest incentives at the lowest obligations in the regulatory framework,” Xung stressed.

Xung pledged to create the best conditions for businesses, including labour training, land clearance and transparency. The province will have dialogue with firms on the 21st every month to tackle their difficulties.

Xung said that the province calls for in investments in five core pillars: processing and manufacturing, agriculture, tourism, healthcare and urban and infrastructure development.

The province is concentrating resources in completing the infrastructure system for Nghi Son Economic Zone, which has already attracted $17 billion worth of investments and industrial parks.

Being the largest investor in Thanh Hoa--which poured around VND20 trillion (US$877 million) in 10 projects in the province--FLC Group praised the province’s large potential and favourable business environment.

Thanh Hoa covers more than 11,000sq.m. and has a population of 3.6 million people, ranking fifth nationwide in natural area and third in population.

The province has immense potential for tourism, with more than 150 kilometres of coastline and dozens of heritage sites.

Per capita average income was US$1,620 at the end of 2016, the highest level in the north central region. It is expected to reach $1,750 in 2017.

The province is striving to record economic growth of 12 per cent this year. 

Habeco targets 9 per cent increase in revenue

     

Ha Noi Beer Alcohol and Beverage Joint Stock Corporation (Habeco) targets total revenue of over VND8.8 trillion (US$390 million) in 2017, up 9.1 per cent year-on-year.

The brewer plans to earn pre-tax profit of VND1 trillion this year, up slightly from 2016, and dividends are projected at 20 per cent.

The company’s revenue in 2016 grew by 8 per cent to reach VND8.1 trillion. Pre-tax profit reached VND997.3 billion, up 0.6 per cent year-on-year.

With this result, the dividend rate was adjusted upwards to 18 per cent, equivalent to VND417 billion. The company paid 10 per cent dividend in 2015.

The Ministry of Industry and Trade (MOIT), Habeco’s biggest stakeholder with 81.79 per cent capital, is expected to collect VND341 billion.

At its 2017 annual general meeting of shareholders held last week, two members of the board of directors were dismissed, including Nguyen Thi Nga representing the Ministry of Industry and Trade and Tayfun Uner, CEO of Carlsberg Viet Nam, which currently holds a 17.08 percent stake of Habeco.

Do Xuan Ha was appointed to replace Nguyen Thi Nga from May 11 until the Ministry of Industry and Trade has made a decision on personnel.

Habeco only elected one new member to the board, namely Soren Ravn, Business Development Manager of the Carlsberg Group. With this change, Habeco temporarily has just four board members.

Headquartered in Ha Noi, Habeco is the largest beer producer in the North and the third-largest beer company in Viet Nam, with popular brands such as Ha Noi Beer and Truc Bach Beer. It owns 17 subsidiaries and nine affiliated companies. 

Quoc Cuong Gia Lai plans paying 8.6% dividend     

Property developer Quoc Cuong Gia Lai JSC is planning to make an 8.6 per cent in-cash advance dividend payment to shareholders for 2017's business performance.

This would be the first dividend payment that the company has made in the last six years. The first dividend payment was made in 2011, one year after the firm was listed on the HCM Stock Exchange, at a rate of 5 per cent.

The expected dividend payment will be discussed at the company’s upcoming annual shareholder meeting, which has been organised to sum up the firm’s performance in 2016 and discuss business plans for 2017.

Quoc Cuong Gia Lai will finalise the list of shareholders that are eligible to attend the annual shareholder meeting on June 2. The schedule and venue for the meeting will be published later.

Shares of Quoc Cuong Gia Lai JSC, under code QCG, soared 4.5 times to close on Friday at VND19,750 per share from their all-time low range of VND4,300 per share, hit on March 21.

Following the first three months of 2017, Quoc Cuong Gia Lai recorded VND269 billion in its first-quarter net combined revenue, triple the revenue recorded a year ago.

However, its net profit was only VND2.5 billion as the company suffered from rising costs of goods sold and double lending interest.

Quoc Cuong Gia Lai has been warned by the HCM Stock Exchange on a national scale as the company violated the market regulation on information disclosure at least three times in one year. 

Forum updates Indonesian firms on Vietnam’s business climate

A Vietnam-Indonesia forum on trade, business and investment promotion has been held in Surabaya city, the capital of Indonesia’s East Java province to update local firms on the business climate in Vietnam.

The event saw the attendance of about 100 representatives from local enterprises operating in the fields of food, beverage, pharmaceuticals, cosmetics and steel-iron.

This was the first Vietnam-Indonesia business forum held in Surabaya, the second largest city of Indonesia after Jakarta, which possesses great potential for development of investment, trade and services.

Addressing the forum, head of the Vietnamese Trade Office in Indonesia Le Hong Minh gave the attendees a brief overview of the Vietnamese market and its policies on taxation, wages, office rental as well as investment incentives offered by some cities and provinces.

He also estimated the difference in costs for operating a business in Vietnam in comparison with other markets such as Thailand, Hong Kong, China, New Zealand and Australia.

During the event, Vietnamese Ambassador to Indonesia Hoang Anh Tuan and representatives of the Vietnamese Trade Office answered enquiries raised by participating enterprises on Vietnam’s laws and regulations regarding quarantine, trade barriers, import-export, and anti-dumping duty on steel products.

East Java province is Vietnam’s biggest trade partner in Indonesia, Tuan told Vietnam News Agency reporters, expressing his hope that similar forums would be held to attract investors from Surabaya and Indonesia as a whole to Vietnam.

Vice President of the Chamber of Commerce and Industry (Kadin) in East Java Johan Suryadarmar said Kadin has maintained a good contact channel with the Vietnamese Embassy to further enhance business cooperation between the two countries.

Leny Surya from Arrayana food company said the forum provided Indonesian firms with better understanding about the Vietnamese market and hoped to have an opportunity to do business in Vietnam.

Viglacera builds apartments for workers at industrial park

The State-owned glass and construction ceramic corporation Viglacera began the construction of a complex of apartment blocks for workers at Dong Van 4 industrial park in the northern province of Ha Nam on May 19.

The project spans 16.69 hectares and is capable of accommodating over 9,100 people.

It comprises of social housing units for sale or rent, a public service centre, a kindergarten, a clinic and green space.

It is expected to address housing problems for workers and experts at the park and help them cut travel cost.

Owning 10 industrial parks that cover a total of 3,580 hectares, Viglacera is the third biggest industrial park builder in Vietnam.

According to Deputy Minister of Construction Bui Pham Khanh, around one million workers in 320 industrial parks nationwide have demand for accommodations.

To serve that demand, 167 projects, with combined capacity of about 126,800 apartments, have been carried out. Of the total, 97 projects have become operational, offering 38,800 apartments.

Work starts on Nha Be garment factory in Soc Trang

The Nha Be Textile Garment Company (NBC) kicked off construction of a new garment making factory in the Mekong Delta province of Soc Trang on May 19.

The factory, with total investment of more than 300 billion VND (13.2 million USD) will generate jobs for 4,000 workers, said Pham Phu Cuong, Chairman of the Board of Directors of the NBC.

The first phase of the factory is scheduled to begin operation in February 2018, employing 2,000 workers, while the second phase of construction will begin in 2019.

The factory has a design capacity of 25-30 million products per year, with estimated export turnover reaching 90-100 million USD per year in the first years in ooperation.

Tran Van Chuyen, Chairman of the provincial People’s Committee said the new factory will create jobs for local residents and contribute to socio-economic development.

The NBC is one of the leading businesses in Vietnam’s textile-garment sector, with 37 affiliated companies and nearly 30,000 workers. 

Export turnover of the NBC hit 729 million USD in 2016 and expected to reach 820 million USD this year.

Vinamilk to invest in milch cow farm in Ha Nam

The northern province of Ha Nam has given nod to a milch cow farming project in Thanh Nguyen commune, Thanh Liem distrtict invested by the Vietnam Dairy Products Joint Stock Company (Vinamilk). 

At the 73rd meeting of the standing board of the provincial Party Committee on May 19, Vice Chairman of the provincial People’s Committee Truong Minh Hien said the authorities agreed to grant Vinamilk a 40-year lease for a farm covering an area of 150ha with 4,000 heads of cow, and another 500ha for grass and corn cultivation. 

A station will also be built to purchase fresh milk from local farmers. 

Vinamilk is eligible for a 10 percent preferential tax, two-year tax waiver and 50 percent tax reduction for the next four years, tax exemption for animal export-import. 

The province also ensures sufficient infrastructure for the project, offers vocational training support, and pledges to fulfill 10 commitments to investors. 

Secretary of the provincial Party Committee Nguyen Dinh Khang asked relevant departments and agencies to complete administrative procedures, ensuring that the project meets schedule.

Hoa Binh company expands to the Middle East

The Hoa Binh Construction & Real Estate Corporation (HBC) signed a cooperation agreement with HOT Engineering & Construction Company of Kuwait in Hanoi on May 19, as part of its strategy to expand into the Middle East. 

Accordingly, HOT Engineering & Construction will exclusively sponsor HBC in civil construction and infrastructure in Kuwait. 

The two companies will join biddings for the government and private sector’s projects in Kuwait as well as others that HOT won contracts. 

Following the signing ceremony, they will continue with detailed plans on procedures for concrete projects between now and the next five years and join the Kuwait government’s construction projects to materialise the 2035 Vision “Turning Kuwait into a financial and commercial centre in the region”. 

The Kuwait firm also stands ready to help HBC become a major bidder for its construction works. 

HOT Engineering & Construction is currently one of the largest multi-disciplined engineering construction and maintenance companies in oil and gas, industry, civil infrastructure construction in Kuwait and the Middle East.

Petrol prices continue to decrease

Prices of oil and petrol products continued to decrease from 3:00pm on May 20, according to the latest adjustment of the Ministry of Industry and Trade and the Ministry of Finance the same day.

The prices of RON 92 slightly dropped by 211 VND per litre, while that of E5 bio-petrol and diesel oil declined by 197 VND and 343 VND per litre, respectively.

Following a joint decision by the ministries, RON 92 and E5 bio-petrol is sold at no more than 17,063 VND (0.75 USD) and 16,871 VND (0.74 USD) per litre, respectively.

Meanwhile, the new ceiling prices of diesel 0.05S and kerosene are 13,260 VND (0.58 USD) and 11,792 VND (0.52 USD) per litre.

The average global price of RON 92 during the last 15 days to May 20 was at 61,084 USD per barrel, down 1 USD compared to the previous price adjustment.

The prices of petrol and oil are adjusted every 15 days by the two ministries depending on changes in the world market.

Vietjet opens Da Nang – Seoul route

The budget carrier Vietjet Air on May 19 opened a new route connecting Vietnam’s central city of Da Nang with Seoul, the capital city of the Republic of Korea (RoK). 

The airlines will conduct round-trip flights everyday from May 31 with one-way ticket costing from 630,000 VND (28USD). 

The flight from Da Nang departs at 23:45 (local time) and arrives in Seoul at 6:00 (local time). The return flight takes off at 7:00 (local time) and lands at 9:40 in Da Nang. 

The new route launching aims to offer more opportunities for Vietnam and international tourists to travel while boosting trade and investment between localities of the two countries, said Vietjet Managing Director Luu Duc Khanh.

Da Nang is Vietnam’s fouth destination to be connected with Seoul, following the routes from Ho Chi Minh City, Hanoi and Hai Phong, increasing the total routes operated by Vietjet between Vietnam and the RoK to five.

Vietnam province mulls clearing protection forest to build industrial park

A considerable area of a 30-year-old protection forest with mangrove trees towering five meters high in the northern Vietnamese province of Thai Binh now risks being cleared to make space for an industrial park.

Authorities in Thai Binh, some 120km south of Hanoi, have plans to reclaim 320 hectares of coastal area in Thai Thuy District to make way for an industrial park on the reclamation ground.

The project includes the destruction of 150 hectares of forests originally planted to protect the mainland from erosion and landslides, according to the environmental impact assessment submitted by the provincial administration to the Ministry of Natural Resources and Environment.

News of the possible destruction has infuriated villagers around the forest, sparking fears of potential devastation as “the forest is considered far more precious than gold to villagers like us,” Le Ngoc Cung, one local, said.

Cung still recalls that the first trees were planted in the forest in 1986, when a local dike broke.

“The forest has since become a golden shield for thousands of households against storms,” Cung told Tuoi Tre (Youth) newspaper.

“We also use its water to catch seafood in order to earn a living.”

The villager added that the new minister of environment Tran Hong Ha attended a tree planting ceremony in early February in celebration of the World Wetlands Day, “and now they are planning to empty 150 hectares of forest.”

The 320 hectare land plot proposed to be used for the project lies entirely within the biosphere reserve of the Hong (Red) River, according to data reviewed by Tuoi Tre.

The particular150 hectare area marked for clearance was grown as part of a government-backed plan to add five million hectares of forest to Vietnam.

Thai Binh officials are also wary of the plan, warning that the project’s environmental impact assessment notes that clearing 150 hectare forest might create an environment which would allow seawater to reach the mainland and destroy local dike systems and aquatic farms in the event of strong storms.

The report does not mention any specific impact the deforestation may have on the local area.

The Thai Binh administration assigned the provincial agriculture department as the developer of the controversial land reclamation project.

The developer, in turn, tasked the monitoring agency under the province’s environment department with preparing the environmental impact assessment.

In the document, the agency says the reclamation will affect areas now used as aquatic farming grounds for 80 households in the Thuy Xuan and Thuy Hai communes, adding that the impact is ‘small’ as these farms yield poor economic outputs.

However, Tuoi Tre was told a much different story from local villagers.

Nguyen Duc Anh, who runs a large aquatic farm, said he was shocked at the assertion that there are only 80 aquatic-farming households in Thuy Xuan and Thuy Hai.

“The data is certainly inaccurate,” he said.

Bui Ngoc Hien, chairman of Thuy Xuan Commune, also said the number of aquatic-farming households in the two communes could not possibly be as low as 80.

Hien’s counterpart in Thuy Hai Commune asserted that in his locale alone, “right now there are as many as 297 households with aquatic farms.”

According to data gathered by Tuoi Tre, there are 354 aquatic-farming households in Thuy Xuan and Thuy Hai, 4.5 times higher than the statistic in the project’s environmental impact assessment.

The developer held two separate meetings seeking feedback from Thuy Xuan and Thuy Hai leaders and residents about the project.

However, Tuoi Tre discovered that invitations for both meetings, held in December 2016, were not extended beyond local leaders.

Simply put, the aquatic farmers – the people most affected by the project – never received an invitation.

The communes’ leaders confirmed that the developer has yet to meet with farmers.

Even so, the environmental impact assessment stated clearly that “following the public meetings, local residents have shown support for the project and its potential to help boost the industry-service development [of the province].”

Quang Tri: Huong Linh 2 wind power plant joins national grid

The Huong Linh 2 wind power plant invested by Tan Hoan Cau Company in the central province of Quang Tri joined the national grid on May 19, one year ahead of schedule.

The construction of the plant, the first of its kind in Quang Tri and the central region, began in Huong Linh commune, Huong Hoa district in 2015 at total cost of more than VND1.4 trillion (US$61.57 million). 

The wind farm consists of 15 turbines with a combined capacity of 30 MW, of which five become operational. The turbines were provided and installed by Denmark’s Vestas Company.

The operation of Huong Linh 2 has created a large source of energy for the country and contributed to local socio-economic growth.

Also under construction in the commune is the 30MW Huong Linh 1 wind power plant, which spans 15 hectares.

Huong Hoa, Gio Linh and Con Co districts have been earmarked for the development of wind-power in Quang Tri toward 2020.

APEC – driver of world economy: Trade Minister

The Asia-Pacific Economic Cooperation (APEC) region will maintain its motive force position in the global economy and continue contributing to the world economic growth through its huge production, consumption, and services supply power.

Minister of Industry and Trade Tran Tuan Anh made the statement in an interview granted to Vietnam News Agency on the threshold of the 23rd Meeting of APEC Ministers Responsible for Trade (MRT 23) to be held in Hanoi on May 20-21.

He affirmed that over the past 28 years, APEC economies have recorded impressive growth. The region’s gross domestic product (GDP) increased from US$16 trillion in 1989 to over US$20 trillion in 2016, with per capita income rising by 74%.

Regarding trade, Anh noted that the region’s average tax rate declined from 11% in 1996 to 5.5% in 2016, which reflected efforts made by the region and each economy to implement cooperative activities on trade liberalisation and trade and investment facilitation.

The International Monetary Fund’s Regional Economic Outlook for Asia and the Pacific estimates growth for the region to increase this year to 5.5% from 5.3% in 2016, he revealed.

The minister emphasised the need for APEC economies to coordinate harmoniously in building a general trade system towards equality and balance, for interests of people and businesses and for prosperity of society.

“Specially, we need to always define shortcomings of globalisation and trade liberalisation so to take thorough and sustainable moves that ensure each economy’s benefits harmoniously,” he said.

In fact, Vietnam also has economic sectors where people and businesses are vulnerable to negative impacts of the globalisation process. Therefore, it is necessary to consider demand, capacity and specific conditions to ensure the integration are feasible, effective, and transparent.

“Once equality in the integration framework and commitments to joining the globalisation process are achieved, each economy’s sustainable development, social equality and prosperity will be guaranteed,” he added.

Regarding the MRT 23, Minister Anh said that Vietnam gives high priority to main outcomes that need to be reached during the event with a hope to coordinate with other APEC economies in building a peaceful, stable, and prosperous Asia-Pacific region.

Within the MRT 23 framework, Vietnam wants ministers to review achievements and discuss responsibly cooperative agreements and orientations on trade development towards trade liberalisation, he added.

Forum updates Indonesian firms on Vietnam’s business climate

A Vietnam-Indonesia forum on trade, business and investment promotion has been held in Surabaya city, the capital of Indonesia’s East Java province to update local firms on the business climate in Vietnam.

The event saw the attendance of about 100 representatives from local enterprises operating in the fields of food, beverage, pharmaceuticals, cosmetics and steel-iron.

This was the first Vietnam-Indonesia business forum held in Surabaya, the second largest city of Indonesia after Jakarta, which possesses great potential for development of investment, trade and services.

Addressing the forum, head of the Vietnamese Trade Office in Indonesia Le Hong Minh gave the attendees a brief overview of the Vietnamese market and its policies on taxation, wages, office rental as well as investment incentives offered by some cities and provinces.

He also estimated the difference in costs for operating a business in Vietnam in comparison with other markets such as Thailand, Hong Kong, China, New Zealand and Australia.

During the event, Vietnamese Ambassador to Indonesia Hoang Anh Tuan and representatives of the Vietnamese Trade Office answered enquiries raised by participating enterprises on Vietnam’s laws and regulations regarding quarantine, trade barriers, import-export, and anti-dumping duty on steel products.

East Java province is Vietnam’s biggest trade partner in Indonesia, Tuan told Vietnam News Agency reporters, expressing his hope that similar forums would be held to attract investors from Surabaya and Indonesia as a whole to Vietnam.

Vice President of the Chamber of Commerce and Industry (Kadin) in East Java Johan Suryadarmar said Kadin has maintained a good contact channel with the Vietnamese Embassy to further enhance business cooperation between the two countries.

Leny Surya from Arrayana food company said the forum provided Indonesian firms with better understanding about the Vietnamese market and hoped to have an opportunity to do business in Vietnam.     

Samsung Vietnam back to high export growth path

Samsung Vietnam’s export growth has regained some momentum as it looks to obtain US$11 billion from exports in the second quarter of 2017, said general director Han Myoung Sup.

At his meeting with Prime Minister Nguyen Xuan Phuc at the Government Office in Hanoi on Tuesday, Han briefed the Government leader on his company’s business performance, the Government news website reports.

Samsung Vietnam expects to fetch total revenue of US$60 billion this year, including more than US$50 billion from exports. Samsung Display Vietnam (SDV), a subsidiary of Samsung Vietnam, is forecast to export about US$10 billion worth of products this year. With an investment of US$6.5 billion, SDV is expanding its production.

According to a report by Samsung Vietnam, its revenue amounted to US$46.3 billion in 2016 though it stopped Samsung Note 7 smartphone production over issues with overheating and fires. Its exports totaled US$39.9 billion, growing 9.9% over 2015 and accounting for 22.7% of Vietnam’s export turnover.

Six Samsung factories in Vietnam are employing 107,000 Vietnamese workers. The company plans to increase employment to meet the high demand for the firm’s newest smartphone models, Samsung Galaxy S8/S8+.

Han said he expected the Vietnamese Government, ministries and agencies would provide continued support for Samsung Vietnam and SDV to perform well in Vietnam.

Prime Minister Phuc said he wanted Samsung to expand investment into power generation, port infrastructure, science and technology and health care.

He also asked Samsung to help develop supporting industries in Vietnam, transfer technology to domestic enterprises in supporting industries, especially small and medium enterprises, and buy input materials for its projects in the country.

The Vietnamese Government will create favorable conditions for foreign investors like Samsung to do business, Phuc said.

Samsung factories in Vietnam specialize in electronics and household appliances. Samsung Vietnam exports its products to 52 countries and territories.

Hindrances to business pinpointed

Business executives on May 17 indicated a host of legal impediments to their operations during a meeting between the Prime Minister and the business community in Hanoi on May 17.

Jonathan Moreno, chairman of the Board of Governors of the American Chamber of Commerce in Vietnam (AmCham Vietnam), proposed the Government eliminate costly barriers to trade ties between Vietnam and the United States.

He also suggested amending Government Decree 181 which guides the implementation of the Advertising Law to help reduce costs for small and medium enterprises. Some provisions in the law prevent them from promoting their products and services on the Internet.

AmCham Vietnam objects to a draft decree on road transport business which requires transport service providers to inform the ministry of every trip operated, he said, adding that this would be a costly administrative burden for the sector.

He proposed the Government review mandatory fees if it is to maintain and boost the competitiveness of local businesses.

Le Hoang Chau, chairman of the HCMC Real Estate Association, hailed the Government’s decision to inspect 60 large-scale property projects suspected of irregularities but suggested allowing investors to continue work on those projects to avoid any interruptions. If any problems with financial obligations are found, they should be forced to fulfill these obligations to move on with their projects.

He proposed amending the Law on Public Procurement, especially provisions on the land use right auction mechanism, to ensure transparency, and other legal documents to facilitate the equitization of State-owned enterprises.

Nguyen Huu De, chairman of the Vietnam Private Hospital Association, stressed the need to proceed with a personnel reshuffle to improve the efficiency of State agencies.

There should be incentive policies for attracting the private sector to develop and operate hospitals as public hospitals are overwhelmed with patients.

Le Van Kiem, chairman of Long Thanh Golf Investment and Trading Joint Stock Company, said the Government should provide exchange rate guarantees for investors involved in road projects which often take a long time to recoup investment capital.

His company and its Japanese partners are interested in developing big-ticket road projects like the North-South Expressway and taking over some roads which have been built in build-operate-transfer format from State-owned enterprises.

SBV says interest rates now reasonable

Interest rates of 6-11% per year for Vietnam dong loans and 3-4% for those in foreign currency are reasonable, according to the State Bank of Vietnam (SBV).

Delivering a report at a meeting between the Prime Minister and private business in Hanoi on May 17, SBV governor Le Minh Hung said that compared to regional countries, those rates are acceptable as the rate is 13% in Myanmar, 11.9% in Indonesia, 6.3% in Thailand and 5.4% in Singapore.

The central bank received a total of 29 proposals from businesses in the run up to the meeting, he noted.

Regarding a proposal for lending rate cuts, Hung said interest rates had stayed stable since 2016. In late September 2016, a number of banks lowered deposit rates by 30 to 50 basis points and lending rates by 50 to 100 basis points for priority production and business areas. The current interest rates are much lower than in 2011.

In regard to Resolution 24/2016/QH14 of the National Assembly on the goal of making the average domestic lending interest rate competitive with the rate of ASEAN-4 by 2020, Hung said the central bank will try to keep interest rates stable in line with the inflation control objective. Banks can still bring down interest rates if they cut costs and improve business efficiency.

On the exchange rate, he said the exchange rate between the Vietnam dong and the U.S. dollar had gone up 1.1% to 1.2% on average. But the foreign exchange market in Vietnam is much more stable than elsewhere in the region and the world.

The central bank has bought large amounts of foreign currency, thus taking the nation’s foreign reserves to a record high, he noted.

The central bank will find ways to meet the demand for short-term foreign currency loans to bolster production and business activities in supporting industries, high-tech, agriculture and rural areas, export, and small and medium enterprises (SMEs).

Credit will be prioritized for the manufacturing sector with a ratio of about 80%, Hung said, and key projects will account for 50% of total outstanding loans.

Currently, medium- and long-term loans make up 53% of total outstanding loans, while medium- and long-term capital raised by credit institutions accounts for only 15% of the total, putting pressure on the banking system.

To help inject more funds into the economy, the central bank allows credit institutions to use up to 50% of their short-term capital to make medium- and long-term loans available for corporate borrowers.

Credit grew 18.25% in 2016. This year, high credit growth has been maintained. By the end of April, loans had edged up 5.76% over the end of 2016, higher than the same period last year, with loans in Vietnam dong up 5.87% and those in foreign currency up 4.64%.

In the coming time, the banking sector will continue to concentrate capital on the preferred areas,

The SBV asked the Government and the National Assembly to issue a resolution on settlement of bad debt to create new financing sources for lending to production and business and support businesses to solve their bad debts, said the governor.  

More specific rules on veggies traceability needed

The veggies traceability program has produced some encouraging results in HCMC since its launch on January 18 but there are suggestions that specific regulations on traceability should be issued.

Competent agencies should update and supplement regulations on produce traceability, said Nguyen Thi Hong Minh, chairwoman of Traceability Solutions and Services Joint Stock Company.

Minh said the Food Safety Law and Circular 74 of the Ministry of Agriculture and Rural Development require producers to provide information on goods origin. However, they lack details.

“In order to obtain detailed information on food traceability, information about farming and harvesting procedures is needed,” she said. Therefore, she proposed State agencies introduce more stringent regulations on origin traceability.

She noted producers may not mention all details about origin traceability on packaging and that consumers may not notice them. However, they are obliged to store such specific information in their systems so that authorities can check it when food poisoning incidents occur.

She urged State agencies to introduce a standard logo for goods that meet Vietnam Good Agriculture Practice (VietGap) standards.

A representative of the Saigon Union of Trading Co-operatives (Saigon Co.op), which is known for the Co.opmart supermarket brand, said the program has gradually improved consumer confidence.

Tran Ngoc Ho, deputy director of the HCMC Department of Agriculture and Rural Development, said the city government plans to expand the current food origin tracking program in the coming time.

VCCI calls for realistic startup targets

The Vietnam Chamber of Commerce and Industry (VCCI) has warned against setting unrealistic targets as provinces have scrambled to announce their lofty goals of having new enterprises coming in being in the next three years.

The central Government has set a target of having one million active enterprises by 2020 but the number of enterprises which cities and provinces have registered has now reached a staggering 1.5 million.  

VCCI Chairman Vu Tien Loc said in a report prepared for a second meeting between Prime Minister Nguyen Xuan Phuc and the business community in Hanoi on May 17 that some provinces have set general goals of doubling the current numbers of businesses.

In 2016, the number of newly-registered enterprises hit a record high of 110,100, with total capital of VND891.1 trillion, up 16.2% and 48.1% respectively from 2015, according to VCCI. In the first four months of this year, 39,580 new businesses came into being, bringing the total number of registered enterprises by April 30, 2017 to a little more than one million.

With those firms suspended, disbanded and resuming operation in 2016 taken into account, the nation had an estimated 546,281 active enterprises on December 30, 2016.

However, a high level of insolvency is still cause for concern. In 2016, over 73,000 enterprises turned inactive or were dissolved, down 9.5% from 2015, of which around 12,500 completed dissolution procedures and the remainder stopped operating.

Loc said, “So far this year, the number of newly-established enterprises has increased but the companies that have suspended operations and been disbanded make up about half the number of newly established entities.”

These are signs of unsustainable business development, according to the VCCI report.

Labor use efficiency went down in 2007-2015 and capital use efficiency dipped as well. The percentage of loss-making businesses rose in 2011-2015 with an average of 40.9%. The return on equity fell from 6.6% in 2012 to 3.2% in 2015.

Business size has not improved much, with the average number of employees per enterprise staying at around 30, far below the criterion for small businesses with fewer than 50 employees.

For three consecutive years (2014, 2015 and 2016), domestic firms were outperformed by foreign-invested enterprises. It was domestic enterprises that caused the trade deficit, and contributed less to the nation’s total exports, only 28.4% in 2016.

Corporate governance at Vietnamese enterprises remains woefully poor. Worse still, they can turn out large volumes of goods but their quality is low.

Thanh Hoa attracts US$6 billion in 32 investment projects

More than 30 projects in the north central province of Thanh Hoa worth a total of VND135.3 trillion (US$6 billion) were given the green light at an investment promotion conference held on May 18.

More than half of investment pledges will go to the manufacturing sector, followed by tourism and urban infrastructure development, which drew VND22.8 trillion and VND21.5 trillion respectively.

The remaining capital is earmarked for agriculture and healthcare projects.

Speaking at the conference, Prime Minister Nguyen Xuan Phuc praised Thanh Hoa province for attracting selective investment in priority sectors, emphasising that with its dynamic economy and great potential, Thanh Hoa will soon become a model province.

He urged the province to continue improving its business environment, increase transparency and reduce costs for enterprises, adding that local authorities should be more active in attracting investment and utilise its competitive advantages.

The Prime Minister asked Thanh Hoa to consider developing a high-tech and large-scale agriculture, diversify its tourism services and enhance the competitiveness of locally based enterprises.

He emphasised that the province needs to give priority to the development of human resources and large enterprises as well as combine fostering economic growth with protecting the environment.

PM Phuc revealed that the government would soon build the Thanh Hoa-Nghe An Expressway, expand rail links, and upgrade Tho Xuan to an international airport.

Earlier the same day, PM Phuc met with the leadership of Thanh Hoa, where he commended the province for determining tourism and related services as a key sector.

The government leader also asked Thanh Hoa to tap into its other strengths to increase the province’s appeal to investors.

Mondelez International invests in cake-making line

Mondelez International is investing in a new cake-making line at its Hung Yen facility to increase its capacity to meet robust market demand. The world-class line is aimed at making Vietnam a key manufacturing country in Asia-Pacific.

According to Mr. Stephane Gripon, Managing Director of Mondelez Kinh Do Vietnam, this investment is a key milestone in the success of Kinh Do’s integration with Mondelēz International. “This investment is part of our integration masterplan and will bring our beloved brands to more consumers across Vietnam and Southeast Asia,” Mr. Gripon told local media. “As the snacks market grows, we aim to increase our production capacity in line with the highest quality standards to systematically anticipate demand in the region. Therefore, we believe it’s the right time to invest.”

The new line follows Mondelez’s global quality standards and strictly follows Good Manufacturing Practices (GMP) to produce various brands of sponge cakes. It has also received Halal “A” certification from the Indonesian Council of Ulama (MUI).

Its integration with Kinh Do since 2015 has been a game changer for Mondelez in Vietnam, creating a business with an annual revenue of more than $200 million and combining shared values and a passion for brands people love.

Mondelēz International completed the acquisition of an 80 per cent stake in Kinh Do in July 2015. First announced in November 2014, the combination brings together Kinh Do’s well-loved local snacks, including Kinh Do mooncakes and biscuits, Cosy biscuits, Solite soft cakes, and AFC crackers, with Mondelēz International's iconic global brands such as Oreo cookies, Ritz crackers, and Cadbury chocolate.

Mondelez’s team has worked hard to renovate their portfolio and innovate in new segments such as premium gifting with brands such as Lu, Cosy, Solite, and AFC. Oreo has also benefited from its strong distribution system in traditional trade channels.

Lu La Collection Française, the company’s new French butter cookies product, found success during the last Lunar New Year (Tet) holidays with very strong demand, and the Kinh Do brand has also been very dynamic across its fresh bread and mooncake offerings.

Mondelēz International, Inc. is a global snack powerhouse, with pro-forma 2014 revenue of more than $30 billion. Creating delicious moments of joy in 165 countries, it is a world leader in biscuits, chocolate, gum, candy, and powdered beverages, with billion-dollar brands such as Oreo, LU and Nabisco biscuits, Cadbury, Cadbury Dairy Milk and Milka chocolate, Trident gum, and Tang powdered beverages. 

SolarBK greening out logistics industry

Vietnam’s first solar-powered green logistics centre, Tan Cang-Song Than ICD, is slated for completion in September 2017 and is expected to contribute to the sustainable development trend in the domestic logistics industry.

Solar ESCO JSC, a member of Vietnamese renewable energy firm SolarBK, and Tan Cang-Song Than ICD signed the contract to lease the solar system to ICD Song Than Logistics Center in the southern province of Binh Duong, with a total capacity of 500.96 kWp.

Under the agreement, Solar ESCO JSC would invest in the solar power system being installed by SolarBK at Tan Cang-Song Than ICD.

This solar-powered model is not only economical but also contributes to environmental protection, helping to reduce CO2 emissions by 518.5 tonnes a year.

Nguyen Thanh Son, director of Tan Cang-Song Than ICD said, “the trend of green logistics has been developing globally for many years, and customers increasingly attach environmentally friendly clauses to business contracts.”

He added that they always expect a holistic solution that can solve both economic and social responsibility issues. On this basis, they found that SolarBK provides tailored solutions to these issues.

In this solar grid solution, SolarBK will provide 1,616 IREX solar panels with a total system peak power of 500.96 kWp. Accordingly, the system will generate about 784,218 kWh of electricity annually. To supply stable power for warehouse service, SolarBK has carefully calculated the optimal settings thanks to its previous experience in implementing large projects.

SolarBK is the leading provider of renewable energy solutions in Vietnam, with a wide range of internationally-certified products exploiting wind and solar energy. It is gearing up efforts to extend the list of solar systems implemented in Vietnam, promoting cleaner and greener development.

Crocodile breeders face huge losses amid falling prices

Crocodile farmers in the southern region of Vietnam are suffering from heavy losses in the context of excessive supply but weak demand, resulting in a record low price.

To date, hundreds of thousands of crocodiles in the southern region, including HCM City and Binh Duong and Dong Nai provinces, have been unable to be sold.

Nguyen Minh Tuan, the owner of Thuy Loi crocodile farm in Dong Nai Province’s Dinh Quan District, said that a kilo of crocodile is now sold at VND50,000 (USD2.27) compared to VND200,000 (USD9) last year.  

Nguyen Huu Bang, who has 10 years of experience in crocodile breeding in HCM City’s Hoc Mon District, said that his farm now has more than 200 crocodiles which are old enough to be sold, but he is reluctant to sell because of the low price.

“I’ll wait a bit longer and if the situation doesn’t improve, I’ll be forced to sell them at a cheap price to cut my losses. If 100 crocodiles are sold at VND70,000 per kilo, I’ll face a loss of VND40 million,” Bang estimated.

Some years ago, traders rushed to buy crocodiles for sales mainly to China, pushing the prices up, to VND230,000 (USD10.45) a kilo. The number of crocodile farms in the southern region sharply increased. Besides, it is quite simple to rear crocodiles which do not often catch diseases. One person can care for around 400 crocodiles.

To date, Dong Nai Province only is home to 300 crocodile farms with more than 100,000 crocodiles in total. Ca Mau has around 300,000 and HCM City and Bac Lieu has 200,000 each.

According to Nguyen Ngoc Thanh, head of the South Eastern Crocodile Co-operative, HCM City set up Saigon Crocodile Village which ensures to find outlets for breeders at the stable price of VND120,000 per kilo. However, when traders offered much more attractive prices, many farmers broke the contracts signed with the co-operative for the sales to traders.

Thanh suggested the establishment of Vietnam Crocodile Association to protect the domestic crocodile industry from unfair competition by traders. The association should also contribute their opinions to work out measures for the crocodile breeding sector. 

K-Park aims to build ‘little Seoul’ in Ha Noi     

CenInvest Company and Hi Brand Viet Nam Company on Wednesday signed a co-operation agreement to develop the K-Park apartment project in Ha Noi’s Ha Dong District.

Speaking at the signing ceremony, Han Seung Mok, deputy general director of Hi Brand Viet Nam, said they chose CenInvest as their long-term strategic partner due to its experience in the local real estate market.

The K – Park will have a green and modern living space with South Korean style apartments suitable for young residents.

People can easily reach the city’s centre and entertainment areas. Especially, the project is surrounded by two big parks and big lakes.

European businesses unhappy with tax authorities’ handling of filing errors   

How to improve the business environment in Viet Nam with respect to customs, trade facilitation measures and the tax regime by capitalising on the opportunities thrown up by the EU -- Viet Nam Free Trade Agreement were discussed at a European Chamber of Commerce in Viet Nam (EuroCham) meeting in Ha Noi on Tuesday.

The meeting, titled “The changing landscape of trade, customs and taxation in Viet Nam,” was attended by hundred of government officials, experts and business executives who expressed concern about customs audit and penalties for administrative inconsistencies in tax declarations.

Pham Ngoc Thach of the Viet Nam Chamber of Commerce and Industry (VCCI) said while companies were increasingly happy with the improvements in customs and administration, they could not keep abreast of the many amendments to regulations, resulting in delays in filing customs declarations.

Thach quoted a 2016 VCCI report on administrative and customs procedures that said over 20 per cent of companies faced difficulties with procedures related to tax exemptions and refunds.

Business executives warned that setting the rules to impose taxes and apply penalties to administrative mistakes would worsen the investment environment in Viet Nam.

Nguyen Thi Thu Cuc, chairwoman of the Tax Consultants Association, said the Government was making efforts to improve administrative and taxation procedures.

To attract more investors, it needed to have a transparent legal system, and the investment environment should be better and the cost of entering the market lower, she said.

Delegates referred to challenges faced by businesses with respect to customs-related legal documents: For instance, customs authorities’ ability to reject the value declared by a business or their competence in handling businesses’ administrative errors in declarations.

Many businesses have been audited by the customs authorities and had their customs declarations rejected and penalties slapped for administrative errors found in declaration from several years ago.

Shivam Misra, co-chairman of EuroCham’s Wine & Spirits Sector Committee, said: “The European business community is very concerned about the customs framework and its manner of execution, especially if administrative errors are used to open up valuation methods or impose heavy non-merit based penalties. This undermines the confidence that businesses have in Viet Nam and its investment environment. Companies might be forced to reconsider investing and also downsize operations if the environment is not conducive to business operations. We want to co-operate with and support the Government, but it becomes difficult if businesses are not given a fair chance to conduct their operations smoothly.”

Thomas McClelland, chairman of the EuroCham Tax and Transfer Pricing Sector Committee, said: “Viet Nam’s tax framework is increasingly focusing on substance over form as indicated in recently issued tax regulations, for example the recent Decree 20 on transfer pricing.

“However, in practice, our members have experienced that administrative breaches seem to be increasingly the focus of many tax and customs audits.

“The nature of the administrative breaches, such as inconsistencies in a customs declaration or what is considered a failure to follow a non-tax procedure, is simply an administrative mistake which should not be used as the legal basis for the customs or tax authorities to apply tax arrears and penalties or deny a tax refund.

“We see more reasonable and positive treatment when the matter is considered at the higher level such as Ministry of Finance. However, by this time taxpayers have often spent a significant amount of time to try and resolve the issue.” 

Gov’t issues tra fish rules     

The Government has issued a decree on aquaculture management, and tra fish products processing and export, the Government Office reported this week.

According to the decree, which will be effective on July 1, 2017, activities involving the farming of commercial tra fish must meet four conditions.

Individuals and organisations rearing tra fish must have their location and area suitable with land use plans of the provincial People’s Committee.

They must have infrastructure that meets technical conditions for farming commercial tra fish such as water supply system seperating from waste water system and waste treatment area meeting conditions on protecting environment and veterinary hygiene.

Aquaculture facilities must meet regulations on food safety and have certificate on identification number for ponds farming tra fish according to existing regulations.

The decree also has regulations on commercial tra fish processing conditions. The individuals and organisations farming tra fish must satisfy conditions of investment and business according to the July 1, 2016 decree.

They must implement regulations and technical standards on food safety for seafood processing and have a certificate of eligibility for food safety granted by relevant State offices.

They must have a traceability system meeting regulations and ensuring ability of traceability at the facilities.

Tra fish products that are exported must be processed at tra fish processing facilities meeting all the conditions mentioned above.

If individuals and organisations exporting tra fish products do not have processing facility as per the requirement, they must have contracts on purchasing tra fish products from facilities meeting those conditions or contracts on processing the products from eligible facilities.

Decree 55/2017/ND-CP has specific regulations on registering identification number for ponds farming tra fish and regulations on quality and food safety for commercial tra fish products.

It also stipulates responsibilities of the Ministry of Agriculture and Rural Development, Ministry of Industry and Trade, Ministry of Foreign Affairs, and Ministry of Finance to implement this decree, supervise implementation of this decree and solve commercial disputes related with tra fish export products.

The people’s committees of central-level provinces and cities have been given directions on implementing this decree in their provinces and cities and have land use plans for farming tra fish and reports on farming, processing and exporting of tra fish. 

European businesses unhappy with tax authorities’ handling of filing errors     

How to improve the business environment in Viet Nam with respect to customs, trade facilitation measures and the tax regime by capitalising on the opportunities thrown up by the EU -- Viet Nam Free Trade Agreement were discussed at a European Chamber of Commerce in Viet Nam (EuroCham) meeting in Ha Noi on Tuesday.

The meeting, titled “The changing landscape of trade, customs and taxation in Viet Nam,” was attended by hundred of government officials, experts and business executives who expressed concern about customs audit and penalties for administrative inconsistencies in tax declarations.

Pham Ngoc Thach of the Viet Nam Chamber of Commerce and Industry (VCCI) said while companies were increasingly happy with the improvements in customs and administration, they could not keep abreast of the many amendments to regulations, resulting in delays in filing customs declarations.

Thach quoted a 2016 VCCI report on administrative and customs procedures that said over 20 per cent of companies faced difficulties with procedures related to tax exemptions and refunds.

Business executives warned that setting the rules to impose taxes and apply penalties to administrative mistakes would worsen the investment environment in Viet Nam.

Nguyen Thi Thu Cuc, chairwoman of the Tax Consultants Association, said the Government was making efforts to improve administrative and taxation procedures.

To attract more investors, it needed to have a transparent legal system, and the investment environment should be better and the cost of entering the market lower, she said.

Delegates referred to challenges faced by businesses with respect to customs-related legal documents: For instance, customs authorities’ ability to reject the value declared by a business or their competence in handling businesses’ administrative errors in declarations.

Many businesses have been audited by the customs authorities and had their customs declarations rejected and penalties slapped for administrative errors found in declaration from several years ago.

Shivam Misra, co-chairman of EuroCham’s Wine & Spirits Sector Committee, said: “The European business community is very concerned about the customs framework and its manner of execution, especially if administrative errors are used to open up valuation methods or impose heavy non-merit based penalties. This undermines the confidence that businesses have in Viet Nam and its investment environment. Companies might be forced to reconsider investing and also downsize operations if the environment is not conducive to business operations. We want to co-operate with and support the Government, but it becomes difficult if businesses are not given a fair chance to conduct their operations smoothly.”

Thomas McClelland, chairman of the EuroCham Tax and Transfer Pricing Sector Committee, said: “Viet Nam’s tax framework is increasingly focusing on substance over form as indicated in recently issued tax regulations, for example the recent Decree 20 on transfer pricing.

“However, in practice, our members have experienced that administrative breaches seem to be increasingly the focus of many tax and customs audits.

“The nature of the administrative breaches, such as inconsistencies in a customs declaration or what is considered a failure to follow a non-tax procedure, is simply an administrative mistake which should not be used as the legal basis for the customs or tax authorities to apply tax arrears and penalties or deny a tax refund.

“We see more reasonable and positive treatment when the matter is considered at the higher level such as Ministry of Finance. However, by this time taxpayers have often spent a significant amount of time to try and resolve the issue.” 

CSR holds key to sustainable growth for mining industry

Sustainability has remained a top priority for the mining industry and the Government.

The topic has also been much discussed over the years by experts and specialists in the field, including from the APEC Mining Task Force (MTF), which was established in 2007.

It was again on the agenda at the APEC Mining Policy public-private dialogue held as part of the second APEC Senior Officials Meeting (SOM 2) in Ha Noi recently.

One of the questions asked was: Can mining companies change the negative image of their industry as one that leaves social and environmental scars and achieve sustainable growth?

The answer is yes if they can communicate the value of mining to targeted communities and optimise socio-economic benefits to boost sustainable community development.

One of the ways to do this is through corporate social responsibility (CSR) programmes.

The Government constantly encourages enterprises to deliver on CSR and make it a key to gain a competitive edge.

In his closing speech at the fifth plenary meeting of the 12th Communist Party of Viet Nam Central Committee in Ha Noi, General Secretary Nguyen Phu Trong had stressed the need to comply with CSR laws.

CSR is especially important for mining companies given the industry impacts surroundings and local communities.

According to Nguyen Quang Vinh, deputy general secretary of the Viet Nam Chamber of Commerce and Industry, CSR programmes are highly beneficial for all companies.

If they realise that, then they would be very successful and could achieve sustainable growth, he said.

Nguyen Minh Duong, chairman of the Viet Nam Association of Mineral Processing, said no company can survive without fulfilling its responsibilities to the local community.

After realising the importance of CSR, some companies have begun to engage in community development activities.

Luu Ngoc Anh of Viet Nam Apatit Limited Company said during its 60 years of operation his company has contributed billions of dong to build new schools and participated in building new-style rural areas.

Nguyen Van Chau, deputy director of Bim Son Cement Co, said his company always tries to give back to the community and pays taxes and fees.

Another example is Masan Resources which owns the polymetallic Nui Phao Mine in Thai Nguyen Province’s Dai Tu District.

The mine, which has one of the world’s largest identified tungsten reserves of 66 million tonnes, was visited by 21 APEC delegates, including some from the APEC mining task force, after the dialogue meeting.

The delegates were impressed most by what Masan has done for the local community.

It has provided jobs to people whose lands were acquired. They in fact account for 56 per cent of the company’s employees, while nearly 20 per cent are from six ethnic minorities.

Vu Hong, deputy general director of Masan Resources, said the company always prioritises locals when hiring staff.

“We are committed to providing vocational training to local people.”

He added that 230 people from families whose lands had been acquired had been trained for 18 months and paid US$150 per month during the training.

Masan has the highest rate of women employees in the mining sector: 24 per cent.

“This is quite high and surprising to me because even in developed countries like Canada and Australia, this rate is usually below 20 per cent,” an APEC delegate from the Philippines, who is also a researcher in the mining sector, said during the site visit.

The company has established an economic restoration programme to create livelihoods for local people.

Under it, six enterprises and co-operatives have been set up, including a packaging firm by Dinh Thi Hai Thuy, a former Nui Phao employee. 

APEC aims to enhance supply chain connectivity

The third Public-Private Dialogue on Advancing Trade Facilitation and Supply Chain Connectivity through Asia-Pacific Model E-Port Network took place in Hanoi on May 19 as part of events in the APEC Year 2017.

Opening the dialogue, Deputy Minister of Industry and Trade Ho Thi Kim Thoa said the Initiative on Asia-Pacific Model E-Port Network (APMEN) was adopted at the 24th APEC Economic Leaders’ Meeting in November 2014 in Beijing, China, with the aim of forming a regional trade and supply chain network. 

The initiative focuses on identifying measures to increase transparency of supply chains through information technology and communication systems.

It practically contributes to APEC’s connectivity priorities, especially enhancing supply and value chain connectivity, thus promoting trade facilitation – one of the most important pillars of APEC.

The dialogue discussed the role of the APMEN in realising the Trade Facilitation Agreement (TFA) and the second phase of the APEC Supply Chain Connectivity Framework Action Plan 2017-2020.

Representatives from APEC member economies and the business circle agreed that increasing information and experience sharing and policy consultancy plays a key role in the region’s policy cooperation process.

The activities of the APMEN, including this dialogue, make important contributions to the sustainable and inclusive development of the Asia-Pacific region in general and each member economies in particular.

ASEAN working group for health supplements meets in Da Nang

The ASEAN Traditional Medicines and Health Supplements Product Working Group (TMHS PWG) convened its 27th meeting in Da Nang city on May 18.

The event attracted more than 150 delegates from traditional medicine and health supplement management agencies and observers in Vietnam and other ASEAN countries.

Speaking at the event, Deputy Minister of Health Truong Quoc Cuong said Vietnam has made substantial contributions to the food and pharmaceutical industries as well as economic growth in ASEAN.

The growing number of health supplements and traditional medicines has helped diversify the food and pharmaceutical market. Therefore, the harmonisation of domestic relevant regulations and standards with those in the region and the world is among top priorities of the Vietnamese Ministry of Health, he noted.

He added the ministry has actively taken part in ASEAN working groups, including the TMHS PWG. It has drawn up guidelines on good manufacturing practice (GMP) for health supplements basing on ASEAN guidelines, and plans to have them compulsorily applied in Vietnam in 2020.

The 27th TMHS PWG meeting was an occasion for ASEAN countries to learn more about the management and development of the health supplement and traditional medicine industry in the region, while seeking coordination to fully tap the sector’s potential.

Cuong called for ASEAN’s investment and cooperation with Vietnam in the industry, thus helping Vietnamese people access more products with good quality and reasonable prices.

At the two-day meeting, participants are set to review the working group’s performance and shared experience in ensuring food safety. They will also discuss the content of an ASEAN agreement on GMP in health supplement and traditional medicine production. 

From May 15-17, representatives of regional countries convened a meeting on the ASEAN regulatory framework on traditional medicines and health supplements, a meeting on GMP in traditional medicine and health supplement production, and another also on traditional medicines and health supplements of the ASEAN Committee on Science and Technology.

ASCOPE enhances cooperation as oil prices decrease

The ASEAN Council on Petroleum (ASCOPE) has agreed to enhance cooperation in the context of decreasing world’s oil prices.

The commitment was made at the end of the 83rd meeting of ASCOPE National Committee, which took place in Vietnam’s central Da Nang city from May 15-17.

During the meetings, members of the council agreed to continue the draft of a guidebook on searching and survey activities in ASCOPE. 

All sides also agreed to bolster cooperation on various issues such as the reuse of waste catalyst and the upgrade and expansion of oil refineries.

Besides, ASCOPE will devise a strategy for response to urgent shortage of gas, as part of the coordinating mechanism in case of emergencies on energy between ASEAN members.

According to Nguyen Quynh Lam, Deputy General Director of the Vietnam Oil and Gas Group (PetroVietnam), Chairman of the ASCOPE National Committee for Vietnam, said Vietnam proposed initiatives on the provision of means and logistics in country members, along with many other ideas towards ensuring implementation of ASCOPE guidelines and benefits of members.

Vietnam joined ASCOPE in 1996, with PetroVietnam being the representative.

Germany’s Bremen State seeks stronger economic ties with Vietnam

Germany’s Bremen State and Vietnam see great potential for cooperation in trade, high technology, renewable energy, seaport, and vocational training, heard a conference held in Bremen, the largest port city in northern Germany, on May 17.

At the event, titled “Vietnam – future market of Bremen’s economy”, experts and representatives from Bremen State’s Ministry of Economy, Labour and Port, and Chamber of Commerce and Industry, as well as about 50 enterprises from the state and neighbouring areas, spoke highly of Vietnam’sinfrastructure, human resources and investment support.

Bremen’s economic experts highlighted the northern port city of Hai Phong as an attractive investment destination in Vietnam thanks to its favourable transportation with a highway system linking with Hanoi, airports and industrial parks. Hai Phong and Bremen also share many similarities, they said.

Businesses’ queries on administrative procedure and non-official fees were thoroughly answered.

The experts also pointed out a number of Vietnam’s weaknesses such as poor capacity in investment promotion.

Addressing the event, Vietnamese Ambassador to Germany Doan Xuan Hung updated the participants on the political and economic situation of Vietnam as well as the Vietnam-Germany partnership in economy and trade.

He said economic and trade cooperation between the two countries has yet to meet potential as two-way trade reached only 10 billion USD, accounting for under 0.4 percent of Germany’s foreign trade revenue, and German investment in Vietnam was just 1.4 billion USD.

He also lauded Bremen’s efforts to promote economic ties with Vietnam.

Bremen has planned to launch its representative office in Vietnam. Earlier in November 2016, Bremen Senator of Economic Affairs Martin Gunthner also led a delegation of 30 local enterprises to Vietnam to seek partnership opportunities.

Ca Mau targets shrimp exports of 2 billion USD by 2020

The Mekong Delta province of Ca Mau aims to earn 2 billion USD from shrimp exports by 2020, according to the provincial Department of Agriculture and Rural Development.

Shrimp will be bred in a total cultivation area of 280,000 hectares, including 267,000 hectares of improved extensive farming, 12,000 hectares of semi-intensive and intensive farming and 1,000 hectares of super intensive shrimp farming.

The province hopes to achieve 280,000 tonnes of output per year.

The goals are part of a project to enhance shrimp productivity and quality and promote sustainable development of shrimp farming. The province also targets raking in 3 billion USD from exporting 415,000 tonnes of shrimps by 2030.

To realise the goals, the province will enhance the capacity of officials and shrimp breeders and study high-efficiency farming models.

The province will set up monitoring systems and build plans to prevent diseases in shrimps.

A consulting group will be established to support enterprises with administrative procedures, farming techniques and to evaluate shrimp cultivation’s impacts on the environment.

The province also hopes to build a brand name for Ca Mau shrimp, choose prestigious agricultural material suppliers and encourage enterprises to provide disease-free breeding for shrimp growers.

Shrimp farming in the locality has been hampered by its small scale and diseases in shrimps.

Vietnam Airlines launches two daily Hanoi-Dong Hoi flights

The national flag carrier Vietnam Airlines will work with the Vietnam Air Service Company (VASCO) to operate two daily return flights connecting Hanoi and the central province of Quang Binh from May 29, the carrier announced on May 18.

The flights, using Airbus A321, will take off at 6:30 from Hanoi and 8:30 from Dong Hoi city. Meanwhile, passengers on ATR72 aircraft will leave Hanoi at 14:30 and Dong Hoi at 16:30.

Promotional air fares on the route, priced from 299,000 VND (13.18 USD), are available for flights departing between May 29, 2017 and March 31, 2018.

Earlier, Vietnam Airlines authorised VASCO to operate seven round trips on the Hanoi-Dong Hoi air route per week, using the 68-seat ATR72 aircraft.

The transfer is part of the Vietnam Airlines Corporation’s plan to improve the operational efficiency of its subordinate airlines, Vietnam Airlines, VASCO and Jetstar Pacific Airlines and expand VASCO’s business to meet increasing demand.

Vietnam Airlines has so far transferred HCM City- Rach Gia-Phu Quoc, HCM City-Phu Quoc-Can Tho and Hanoi-Dien Bien flights to VASCO.

Meanwhile, air routes between Hanoi-HCM City-Tuy Hoa and HCM City-Chu Lai were transferred to Jetstar Pacific Airlines.

Nestlé opens new factory in Hung Yen

A new MILO producing factory of the Nestlé Vietnam Group opened in Thang Long II Industrial Park in the northern province of Hung Yen on May 18.

The factory will create more than 200 new jobs and many indirect jobs for locals while enabling the firm to develop new innovations and nutritional beverages for Vietnamese consumers, said Nestlé Vietnam’s Managing Director Ganesan Ampalavanar at the event.

The inauguration of the factory underlines the company’s commitment to developing nutrition in Vietnam and to improving life quality and contributing to a healthier future, he added.

Nestlé is the world's largest food company, employing more than 328,000 employees worldwide.

In Vietnam, it operates six factories with more than 2,000 employees nationwide and total investment of 520 million USD.

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