VUF conference on Viet Nam cities climate change resilience

The capability of Viet Nam’s cities to respond to the natural disasters caused by climate change will provide grist for discussion at the Vietnam Urban Forum (VUF), held today in Ha Noi.

Around 20 speakers will discuss possible responses to climate change and ways to reduce its effect on urban development.

The group has also planned several symposia on urban development that will take place later this year, as well as a celebration to mark Urban Day on November 8th and another event celebrating the 10th anniversary of the VUF.

BIDV finances resettled residential project

The Bank for Investment and Development of Vietnam (BIDV) will finance a residential project in HCM City with VND4.914 trillion (US$234 million).

According to a credit contract signed yesterday, the term of the loan may reach 24 months.

The international development company 21st Century (Cong ty Phat trien Quoc te The ky 21) plans to develop more than 4,200 apartments on a 32 hectare lot in the Thu Thiem New Urban Area of the city’s District 2.

The Prime Minister instructed the Central Bank to provide further support to theVND6.143 trillion project, part of an HCM City programme to resettle those forced to move by major development projects.

Curb on licences for titanium exploitation

The central province of Binh Thuan will stop granting investment certificates to new titanium ore exploitation projects outside specific areas, following the zoning plan for titanium extraction approved recently by the Prime Minister.

Under the plan, enterprises in Binh Thuan will only exploit and process titanium in the Luong Son area of Bac Binh District, located in the northern part of the province.

Projects elsewhere that have already received investment licences will be allowed to continue, but no new projects will be developed in other areas, said Nguyen Ngoc, vice chairman of the provincial People’s Committee.

Binh Thuan provides 92 per cent of the country’s titanium reserves, with approximately 560 million tonnes of the metal, according to the Ministry of Natural Resources and Environment. The province’s northern part alone contains 142 million tonnes of titanium.

In the national plan, the province was also urged to export more processed titanium ore, rather than raw titanium as it does currently.

In order to limit exports of raw titanium, the province proposed establishing two industrial zones (IZs) - one 250ha IZ in Bac Binh District and one 40ha IZ in Ham Tan District – where it could process the metal.

Previously, the province scrapped 18 titanium-mining projects due to their negative impacts on the environment.

Titanium is a valuable metal used in more than 30 different industrial sectors including plane manufacturing, aeronautics and producing oil and gas exploitation equipment.

Foreign investment in healthcare sector stagnant

Foreign direct investment (FDI) for the domestic health care sector this year may remain at a standstill even though investors are making efforts to complete plans for projects that are overdue.

A staff member of the Viet Nam Foreign Investment Agency, who spoke on condition of anonymity, told Viet Nam News that she did not see any good signs for FDI in the sector this year.

She also said that the healthcare sector seemed to be less attractive to foreign investors, who have complained about difficult procedures and conditions.

She explained that the sector required an investor to put up at least US$20 million to open a new hospital and $2 million to open a new clinic.

“In current difficult economic times, this capital is not small,” she said.

“There is now a big project invested in by Germany. The investors really want to implement it, but they may face many challenges because it is carried out under the public-private partnership scheme, which is quite new here.”

A representative from the healthcare minsitry agrees with her assessment.

Tran Quoc Khoa, a staff member at the Ministry of Health told Dau Tu newspaper that investments in the healthcare sector are very large, and a long time is needed to recoup the money. Thus, investors must be well-experienced in managing their projects.

As a result, even after dozens of years of attracting FDI to the domestic healthcare sector, the country has only six hospitals with 100 per cent foreign investment, with a total capital of US$94 million, and more than 14,000 FDI-clinics, according to Khoa.

One investor, who declined to be named, said that many people like him preferred to invest in other sectors so they can get their money back sooner.

Moreover, the regulations about investment in this sector were unclear and varied in provinces and cities, he said.

In a report yesterday, the Dau Tu newspaper said that Ha Noi and its neighbouring provinces would see the opening of two FDI-hospitals in the first quarter.

However, plans for these have not been completed in a timely manner. In addition, many projects have faced challenges in meeting investment procedures and requirements.

Most of those were interviewed about the subject said that such investments were actually rather modest, especially considering the fact that many residents continue to spend huge amounts of money for healthcare services abroad and that demand has greatly increased. Despite this, there are still an insufficient number of high-quality hospitals.

Ministry to oversee tax on used car imports

Deputy Prime Minister Hoang Trung Hai has asked the Ministry of Finance to review the import tax of used cars in a bid to restrain importers from disguising brand new vehicles as old ones to avoid higher tax rates.

The move follows a proposal from local automaker Thaco Group, who have reported that companies are fraudulently importing cars with engines smaller than 1,000cc.

The import tax imposed on used cars that have this type of engine is US$3,500, the lowest range of tax.

According to recent regulations, used cars must have been registered in a foreign country for at least six months before being exported to Viet Nam and must have a minimum mileage of 10,000 km to be defined as second-hand.

Thaco CEO Tran Ba Duong claimed the company had discovered that many importers had falsified brand new cars as used ones by adjusting the mileage counters to over 10,000 km and changing import documentation. He said that this fraud allows them to pay the low import tax per vehicle rather than the 70 per cent tax imposed on new cars.

Meanwhile, Duong said Kia Morning cars assembled by Thaco in Viet Nam bear a special $4,500 consumption tax plus $2,500 of import tax for parts and accessories.

“That means fraud is resulting in unfair competition between imported cars and locally assembled cars, especially of the brand that we are assembling,” he claimed.

Duong said that as many as 700 used Kia Morning cars were imported to Viet Nam last month, a considerable increase from previous months.

However, according to the General Department of Statistics, the country imported 3,000 cars in January and was estimated to have imported just 1,000 cars this month.

It imported 27,000 cars in 2012, down 50 per cent year on year.

Vietnam partners with India in biotechnology

Vietnam defines India as a strategic partner in its international biotechnology research and development cooperation, which is considered crucial to green industry and sustainable development, said Deputy Minister of Science and Technology Chu Ngoc Anh.

The minister made the statement on February 27 at an international conference held in Hanoi with the participation of scientists from technology research and development institutes in both Vietnam and India .

The Government of Vietnam considers biotechnology as one of the four prioritised science and technology–related areas in the country’s socio-economic development strategy, said Anh.

The minister added that the conference will serve as a forum for the two countries’ scientists to swap views on future cooperation in the field.

Participants agreed that Vietnam and India share similarities in their agriculture-based economy. Therefore, biotechnology will play an important role in the development of both countries’ “green industry”.

At the two-day event they also discussed concrete measures to foster biotechnology development in the two countries, especially in agriculture, health, food and the environment.

Japan keen on metro construction in Binh Duong

Japan will help southern Binh Duong province build an ODA-funded metro line connecting to the Suoi Tien-Ho Chi Minh City metro, which will help with the provincial socio-economic development, a Japanese high-ranking official has said.

Onuma, an official from the Japanese Ministry of Economy, Trade and Industry, made the commitment during a working session with Binh Duong’s authorities on February 27.

The Japanese official highly valued Binh Duong’s potential for urban and industry development, adding that his side’s investment policy designers are paying special attention to strategic projects mapped out by the province, especially those on urban and infrastructure development.

Vice Chairman of the provincial People’s Committee Tran Thanh Liem said cooperation and investment fuelled into his locality by Japanese firms in the past years were efficient.

The province is eager for cooperation with the Japanese side to carry out core infrastructure projects which are crucial to make the provincial Binh Duong city the first rated one as outlined in the plan to 2020 approved by the Government, Liem added.

Japan has so far installed 171 projects in Binh Duong with a total registered capital of over 3 billion USD, ranking second among 37 countries and territories having investment in the province.-

Hanoi tourism to promote potentials abroad

The Hanoi Department of Culture, Sports and Tourism has planned to promote the capital city as a tourist destination in the foreign media.

The promotion programme will be featured on several television channels in Russia and the Asia Travel Mart Online Magazine.

Marketing will also be carried out in potential foreign markets such as Canada , China and the Republic of Korea .

Last year was the first time Hanoi ’s annual foreign tourist arrivals exceeded 2 million, and the city expects to welcome 2.25 million foreign visitors this year.

In 2012, Hanoi was rated the best destination in Vietnam for city life by Lonely Planet Traveller, the world’s leading tourist magazine.

Together with Hoi An, the city made the 2012 top 10 attractive destinations in Asia, as chosen by Smart Travel Asia, a Hong Kong online tourist magazine.

It came second in a list of 100 international cities with good hotel services, which was compiled by the well-known tourism website Trivago.

HCM City to take back licences from delayed projects

Ho Chi Minh City’s authorities will take back licences granted to 48 projects which have less than 50 percent of their land site cleared.

At a meeting on February 26 to hear opinions on measures to deal with delayed projects, the Department of Natural Resources and Environment said that 30 housing and 18 production and trade projects will have their licenses revoked.

Delayed projects in which more than 50 percent of their site has been cleared will continue until this year end to complete implementation, the department said.

Most district representatives agreed with the measures, but some suggested the decisions should be based on the scale of the delayed projects.

They also noted that many projects have been delayed because of investors’ weak financial capacity, a factor that will be difficult for districts to identify and assess.

District representatives petitioned the Department of Natural Resources and Environment to cooperate with other relevant departments to appraise investors’ financial capacities before deciding to revoke delayed projects.

The department will propose to the City People’s Committee detailed measures to deal with delayed projects by the end of this quarter. The list of delayed projects will also be made public, he said.-

VILAF expands in merger with LDV Lawyers

VILAF has expanded its partnership and strengthened its energy practice in a merger with LDV Lawyers, a leading energy law firm in Vietnam.

The two firms believed the merger would create the largest energy team in the country and benefit their current and future energy clients.

Luu Hoang Ha, managing partner of LDV, will become a partner at VILAF based in Ho Chi Minh City.

Ha, a recognised leading energy lawyer in Vietnam, will add to VILAF’s team of seven partners working on projects, power, oil & gas, water, infrastructure and mining. Ha is also vice chairman of the AmCham Vietnam’s Energy Committee, Vietnam director of the Association of International Petroleum Negotiators and a frequent speaker on Vietnam’s energy laws and practice.

Following recent departure of finance and corporate partner Tran Anh Duc, the firm’s finance and capital market team of 14 lawyers is led by managing partner Vo Ha Duyen in Ho Chi Minh City and managing partner Tran Tuan Phong in Hanoi. Additionally, the firm last month promoted counsel Nguyen Quang Vu, an outstanding corporate and finance lawyer, to its partnership.

VILAF, one of the largest full-service business law firms in Vietnam, has 11 partners and 40 associate lawyers. The firm has been consistently ranked by independent legal publications as a first tier firm in Vietnam for corporate/M&A, energy & project, banking & finance, dispute resolution, capital market, and real property practices.

VILAF recently advised Vincom in its $300 million Singapore bond listing transaction, Standard Chartered Bank, Mizuho, Citibank, SMBC and PNB Paribas in different syndicated loans to Vietnam, KKR in its acquisition of shares in Masan Consumer in a complex chain of transactions totaling $350 million, China Southern Power Grid in Vinh Tan 1 BOT Power Project, Unicharm in its acquisition of 95 per cent of the shares in Diana, and SCG Thailand its acquisition of 85 per cent of the shares in Prime Group.

LDV is a boutique energy firm having advised and represented Fortune 500 clients and Vietnamese government agencies in many of the most complex transactions in Vietnam’s energy and natural resources sector. Some of LDV clients include BHBP Petroleum, GE Oil and Gas, KrisEnergy, Mubadala Petroleum, Petronas, and Phu My 3 BOT Power Plant.

Viettel wins Splendora contract

Viettel Hanoi, a branch of Viettel, on February 27 became a partner to develop infrastructure and supply telecommunication service for the first phase of the Splendora project.

The two parties will jointly invest and build infrastructure, and operate telecommunications services and information technology for the Splendora project, invested by An Khanh New City Development Joint Venture Company Limited.

The investment will be made on the basis of rational planning design, ensuring the modern urban aesthetic and safety, ensure quality and meet the needs of customers in the project area.

Services offered include internet, wiring telephone, cable TV, IP next TV, mobile phone, intercity and inter-country data transmission services, video conferencing and many others.

In addition, An Khanh also requires that if customers wish to use other value-added services or select other service supplier, Viettel must research infrastructure upgrade, expand and provide more value-added services or facilitate other suppliers to invest to fully meet the actual needs of customers.

Investor’s representative emphasized that the provision of the service to the client throughout the project should ensure quality, competitive price and in accordance with current laws to protect the rights of customers. An Khanh will not limit the choice of using other suppliers of customers to prevent even smallest inconvenience for residents after moving in this year.

Viettel Group is one of the largest and most prestigious telecommunication groups in Vietnam, with nationwide network coverage. In 2012, Viettel became the largest telecommunications and IT enterprise in Vietnam with sales at VND141.4 trillion ($6.7 billion). Especially, the profits reached over 27 trillion ($1.28 billion), of which sales of telecommunication services oversea reached nearly $740 million.

Government to create large fund for development of coal production

The government plans to invest VND320 trillion (USD15.3 billion) into coal production in Vietnam by 2020.

The plan was approved by the government to develop the coal industry through 2020 with a vision towards 2030.

The government requested that the coal industry make large increases in coal production in the next years.

The country has set a target to annually produce between 66 and 70 million tonnes of unprocessed coal, which can be turned into around 55 million tonnes of refined coal, by 2020.

The yearly output is expected to increase to over 75 million tonnes by 2030, over 10 million of which would come from the Red River coal basin.

A an anonymous executive at the State-owned Vietnam National Coal-Mineral Industries Group (Vinacomin), said on the sideline of a strategic cooperation signing ceremony among Vinacomin, Vietnam National Oil and Gas Group and the Electricity of Vietnam Group that they have gradually been increasing exploitation at pit coal mines while reducing production at open air coal mines.

“The coal industry will need a large amount of investment and a lot of support from the government in the next decade if we are to realise the targets set by the government," he said.

He said that the exploitation of coal from the Red River Basin is still not feasible because of public concern over the environmental impacts of such a project.

“Vinacomin will try to prioritise environmental issues while ensuring the sustainable development of our coal production,” he added.

Slump in Vietnam's motorbike market

About 3.11 million motorbikes were sold in Vietnam in 2012, down 200,000 compared to the previous year.

Honda was still the most popular brand in Vietnam, with 1.95 million sold last year. Yamaha was second, with 800,000 units sold, followed by SYM.

The year 2011 saw the highest sales of motorbikes in the last decade.

Masayuki Igarashi, head of Honda, said the drop in sales in Vietnam came despite a number of promotion programmes and discounts, including offers to pay registration fees.

The situation has been blamed on both the economic downturn and new higher vehicle fees.

According to motorbike companies, their factories in Vietnam produce 5 million vehicles per year, but only 3-3.5 million of them are sold in the domestic market. Many have plans in place to export already assembled motorbikes to foreign markets, according to Saigontimes Newspaper.

Sales of automatic motorbikes saw a better year, which accounted for 40% of vehicle sales during the year. And even though sales on the whole were down, producers have been making long-term business plans, including developing new models.

Piaggio plans to invest in a research and development centre in hopes of increasing their output to 300,000 vehicles per year. Meanwhile, Honda, who expanded their market share from 61% to 62.2%, has plans to build a third assembly plant in Ha Nam Province which would increase their production capacity to 2.5 million vehicles per year. Yamaha also aims at doubling their output to 1.5 million per year.

Although it has been estimated that the Vietnamese market will reach a saturation point when it reaches production levels of around 4.5 million a year, companies still see potential here.

Igarashi remains optimistic, saying that many production facilities have yet to work at their full capacity and that because of the infrastructure and traffic in Vietnam motorbikes hold a number of advantages for customers over cars and other large vehicles.

Industrial production increases 6.8 pct in two months

The Industrial Production Index (IPI) saw a year-on-year increase of 6.8 percent in the first two months of 2013, according to the General Statistic Office (GSO).
Of which, the index of the mining industry increased 1.8 percent over the same period last year, that of the processing and manufacturing, 7.9 percent, electricity production and distribution, 11.7 percent, and water supply and sewage treatment, 9.9 percent.

Meanwhile, the production of several industries saw notable increases includes battery production (107.1 percent), electrical equipment (51.3 percent), machine spare parts (45.9 percent), fertiliser and nitrogen compound (43.3 percent), footwear (35.9 percent), and telecom equipments (26.4 percent).

Boosting exports to Africa

With a population of more than one billion, Africa is considered a potential market for Vietnamese exporters.

Vietnam Customs predicts that the country’s export earnings from Africa would increase by 20 percent to US$3.12 billion this year. In January, the total shipment of commodities to the southern continent already earned US$62.9 million, including telephones and components (US$34.3 million), footwear (US$8.1 million), cashew nuts (US$261.4 million), and coffee (US$1.436 million).

For instance, Senegal’s imports from Vietnam earned US$2.93 million including rice (US$1.39 million), garments and textiles (US$161,300) and means of transport and components (US$195.400) while Algeria’s imports reached US$18.9 million, including rice (US$4 million) and coffee (US$9.9 million).

Despite a moderate growth of trade exchange between Vietnam and Africa in recent years, Africa remains a potential market for exporters.

The International Monetary Fund predicts that Africa would achieve its growth rate of 5-6 percent this year and have at least 17 representatives out of 20 countries maintaining high growth rates in the 2013-2017 period, such as Libya, Guinea, South Sudan, Rwanda, Gambia, Cote d’Ivoire, Ghana, Zambia, Mozambique, the Republic of Congo, Tanzania, Kenya and Ethiopia.

A United Nations forecast says Africa’s population would rise to 1.2 billion by 2050. The average income in the continent is now over US$3,000 per year, although there remains a wide disparity in some countries. This is one of the most important factors which have greatly contributed to the growing demand for imported goods.

According to the Trade Promotion Department under the Ministry of Industry and Trade, Africa accounted for 3.1 percent of total global imports in 2011. South Africa, Egypt and Nigeria have been Vietnam’s leading African markets which spend US$55 billion on importing goods each year respectively.

Vietnam’s exports to Africa have annually increased by 20 percent, earning around US$2.6 billion last year. Its major markets include Egypt, Algeria, Ghana, Nigeria, Cote d’Ivoire, Angola, Mozambique and Morocco which import mostly rice, coffee, pepper, seafood, computers, electronics and components, telephones, means of transport and components, machinery and equipment, garments and textiles, and footwear.

Among these, Vietnamese rice is much appreciated. In the 2011-2013 period, Africa is estimated to consume around 24-24.5 million tonnes of rice per year, including 10 million tonnes of imported rice.

Last year, Vietnam earned US$900 million from rice exports to 32 African nations, up 22 percent from the previous year, and US$264 million from telephones and components, up 104.7 percent, mostly from South Africa, Egypt, Morocco, Angola, and Tunisia. Other export items included computers and components, seafood, coffee, garments and textiles.

Africa is a major producer of cashew nuts, from which Vietnamese businesses expect to import a large volume of raw cashew nuts to reprocess for export to the US and EU.

They also have a plan afoot to buy cotton from 21 African nations, mostly from Mali, Togo, Nigeria, Cote d’Ivoire, Burkina Faso, Uganda, Tanzania, Zimbabwe, Benin and Senegal.

Under a project to promote import-export activities in the 2011-2015 period, the State has been urged to provide stronger support for small and medium-sized enterprises to gain a firm foothold in some key African markets.

Deputy PM works on rice and seafood consumption

Deputy Prime Minister Hoang Trung Hai has affirmed that the expansion of rice fields on a large scale in the Mekong Delta region is on the right track.

At a conference on rice and seafood production and consumption in Dong Thap province on February 27, Hai asked ministries and related departments to regularly meet with businesses to learn about their aspirations.

During the 2012–2013 winter-spring harvest, 13 cities and provinces across the country registered to join the large-scale rice-growing on 71,000 hectares, up 40,000 hectares from last year’s summer-autumn crop.

The Ministry of Agriculture and Rural Development plans to export 1 million hectares of rice, and build a trademark for Vietnamese rice.

Following the Prime Minister’s decision, 211,000 tonnes of rice have been bought and kept in reserve.

Last year, the Mekong Delta boasted a total yield of 358,000 tonnes of shrimps from 595 hectares. Its tra farming on over 5,900 hectares since late 2012 has produced over 1.2 million tonnes.

Pilot PPP project awaits green-light

A fresh capital structure proposal could propel the implementation of Vietnam’s first public-private partnership  infrastructure project, the  Dau Giay-Phan Thiet expressway.

The proposed portion of the state capital contribution to the 101 kilometre Dau Giay-Phan Thiet expressway project, also backed by lead private investor Bitexco Group, has been hiked to 40 from 29.4 per cent of the project’s total investment capital with a loan from the World Bank.

The state’s share on the $1 billion-plus project is roughly tantamount to $429 million, a figure subject to change related to land acquisition costs as described by the Ministry of Transport (MoT) in a bid to ensure the project’s financial feasibility.

The Dau Giay-Phan Thiet expressway project is one of three infrastructure projects under the World Bank’s pilot programme aiming to improve the public-private partnership (PPP) legal framework in Vietnam. The country is banking on the PPP concept for dramatic, multi-billion-dollar infrastructure upgrades in highways, seaports and airports.

Because WB rules restrict it from directly loaning to private firms such as Bitexco, the project’s capital structure has changed noticeably compared to the Vietnamese government’s initially approved scheme. Earlier, the Vietnamese government had envisioned a guarantee for Bitexco to secure a loan from the International Bank for Reconstruction and Development (IBRD), but it was rebuffed.

“Investors then must turn to other sources for their capital needs,” said MoT’s deputy minister Nguyen Ngoc Dong.

The project’s total investment cost was estimated at $1.07 billion if Vietnam could not take loans from IBRD and based on unit rate VND1,000 or 5UScents/CPU/km which is viewed as reasonable by WB experts. The MoT initially proposed the Dau Giay-Phan Thiet expressway project source 49 per cent of the total investment costs from IBRD and 29.4 per cent from the Vietnamese government whereas equity capital of domestic and foreign investors must represent 10.6 per cent of the total investment costs and another 11 per cent capital to come from commercial loans of domestic and foreign banks and from bond issuance.

The Dau Giay-Phan Thiet expressway project is the only project that has basically fulfilled legal procedures as well as capital arrangements among nearly ten infrastructure projects determined for roll-out under PPP form.

The scheme on pilot implementation and management of Dau Giay-Phan Thiet expressway under PPP form was ratified by the Vietnamese government via Decision 1597/QD-TTg issued on October 26, 2012.

Properly setting state capital contribution ratio to ensure the project’s financial feasibility is considered vital before kicking-off the process of selecting the second investor.

Relative to selecting the project’s second investor, according to the WB, draft dossiers on bidding invitations are readily available and if these papers were approved by the Vietnamese government the WB would help the MoT launch roadshows in the region for the project to get exposure to potential investors using Australia’s AusAID funding.

Aeon’s vote of confidence in local consumers

Japanese retail group Aeon will build a third store in Vietnam as it takes aim at the young, potential market.

According to a source of the Ministry of Planning and Investment’s Investment Promotion Centre-North Vietnam, the retailer had obtained an investment certificate for building a $200 million store in Hanoi. AeonMall Vietnam, established last year, will manage and run the project, Aeon’s first in northern Vietnam.

Aeon’s first store was introduced two years ago in Ho Chi Minh City, Aeon Shopping Center-Tan Phu Celadon, located in Celadon City urban project in Tan Phu district, capitalised at $100 million. The Japanese investor plans to complete the construction of the this centre in the first half of 2014, which will be Aeon’s first shopping centre and general merchandise store in Vietnam.

Aeon’s second store is located in southern Binh Duong province, 20 kilometres from Ho Chi Minh City. This project, Aeon Shopping Centre-Binh Duong Canary, is worth $95 million. This project is expected to be launched in 2014.

Nishitohge Yasuo, general director of Aeon Vietnam, previously announced that the retailer targeted to develop 10 centres in Vietnam, adding that the shopping centre in Hanoi could be inaugurated in 2015. Moreover, a chain of specialist shops and 24-hour shops are also planned.

Vietnam’s retail sector was moved out of top 30 countries of retail attractiveness by A.T Kearney as inflation, high real estate price and interest rate had been negatively impacted on consumers and retailers. However, The Nielsen Company, a market research firm, in a survey Grocery Report Vietnam 2012 released last month said the country’s retail sector “is still attractive to foreign investors despite total foreign direct investment decreases.”

“Vietnam has a big room to grow in terms of modern trade store density,” The Nielsen Company said in the report. Like Aeon, other Japanese retailers are also expanding investments in Vietnam including Family Mart and Takashimaya. “Traditional trade is still the dominant channel in Vietnam while modern trade speeds up opening store especially in Hanoi,” said The Nielsen Company.

Korea a world of opportunity

The door to work in Korea in 2013 has widened for Vietnamese labourers.

This is especially so for those who used to work in this market and returned home in time when their contracts expired.

Deputy head of Ministry of Labour, Invalids and Social Affairs’ (MoLISA) Overseas Labour Management Department Le Van Thanh said Korea’s Ministry of Employment and Labour agreed to receive 5,400 Vietnamese workers who used to work in this market and returned home when their contracts expired to continue working in Korea in 2013.

According to MoLISA’s Overseas Labour Centre director Phan Van Minh, Vietnamese labourers finishing contracts and returning home have the right to register for Korean language tests on computer on a quarterly basis as required by Korean side.
The Korean language test will be held once every quarter.

Besides, from January 1, 2013 Korea also applied a fresh minimum salary scheme, with top average salary of Vietnamese workers reaching $1,300-$1,700 per month, making this market increasingly attractive to export labourers.

The matter is how to re-open the door, which is now shut to fresh workers.

It is reported that more than 10,000 Vietnamese labourers bound to work in Korea who had past Korean language exams have their files suspended after Korean government decided not to extend its Employment Permit System (EPS) to Vietnam after the latest agreement expired last August.

That was because of high rates of Vietnamese export workers illegally staying in Korea after their contracts got expired.

“Korea would continue receiving fresh Vietnamese workers if there were effective measures to ensure low rates of ‘runaway workers’,” said Minh.

Towards this goal, Minh suggested application of new stringent requirements to labourers bound to work in Korea such as they ought to deposit a certain amount of money before leaving for Korea to ensure they will come back in time or the five-month salary allowance Korean employers pay when export workers finish contracts be given to workers in Vietnam when they return home but not in Korea. If they abscond, this amount will go to public budget.

Some 7,000 Vietnamese labourers went to work in Korea in 2012 under Employment Permit System with Korean government despite Korea stopped receiving new Vietnamese workers in later months of the year against over 12,000 in 2011, according to MoLISA statistics.

The Overseas Labour Management Department envisages bringing about 85,000 Vietnamese labourers to work abroad in 2013 and consolidating relations with key markets such Taiwan and Japan remains its priority since outset of 2013.

MB opens new branch in Tay Ninh

The Military Joint-Stock Bank (MB) has just opened its first branch in the southern province of Tay Ninh.

The headquarters of the branch is located at No 360-362, 30-4 road, Tay Ninh town.

With the newly-opened branch in Tay Ninh, MB has set its foot in more than 40 cities and provinces across the country.

According to MB officials, the new branch will provide various banking products and services, meeting the highest needs of local people and businesses.

At the business opening day, the MB branch offered 500 gifts to the first clients.

The branch also coordinated with the Tay Ninh Education and Training Department presenting 100 gifts worth VND 300,000 each to poor children with good school records.

ODA highways to hit top gear

Big donor-funded highway projects are expected to entail breakthroughs for transport sector development in 2013.

In his first 2013 message, Minister of Transport Dinh La Thang required transport sector project developers to keep up the pace of official development assistance (ODA) capital projects.

Particularly, besides two big northern highway projects with construction due to be finalised by December 2013, the Ministry of Transport (MoT) asked developers under its management to kick-off construction of another 11 ODA-funded projects with investment capital of nearly $6 billion.

Two northern highway projects slated for completion before end of 2013 are the 245 kilometre long Noi Bai-Lao Cai expressway valued at VND19.998 trillion ($952 million) funded by Asian Development Bank (ADB) with Vietnam Expressway Corporation (VEC) as the developer and the 60km long four-lane Hanoi-Thai Nguyen expressway with investment surpassing VND10 trillion ($476 million), funded by the Japan International Cooperation Agency (JICA).

“With available capital, three mammoth ODA highway projects, the $1.3 billion Danang-Quang Ngai expressway, the 1.5 billion Ben Luc-Long Thanh expressway and $571 million Tan Vu-Lach Huyen motorway will bring huge work volumes to transport sector contractors in 2013,” said head of MoT’s Transport Engineering Construction and Quality Management Bureau Tran Xuan Sanh.

In light of Resolution 02/NQ-CP dated January 7, 2013 with several measures to tackle difficulties in production-business, support market and clear bad debts, implementation of ODA projects was particularly upheld by the MoT.

Accordingly, from late 2012 contractors at some ODA projects were advanced an additional 10 per cent contract value and got payment of 80 per cent of material costs at construction sites.

Efforts were also made to shorten payment process to alleviate contractors’ financial woes.

The MoT estimated if Vietnamese reciprocal capital needs were satisfactorily met, transport sector ODA projects could reach capital disbursement volume of VND40 trillion ($1.9 billion) in 2013, creating huge workloads, contributed to ensuring social order and security.

Inflation up 2.6 percent in two months

Inflation has risen by nearly 2.6 percent in the year to date, according to the National Financial Supervisory Commission (NFSC).

But inflation in February was up just 1.32 percent on the previous month – the lowest February increase since 2010.

The NFSC attributed the modest increase to weak demand and monetary factors that contributed to inflationary pressures. Vietnam’s efforts to control inflation in 2013 mainly depend on its price management policy.

The inflation rate stood at around 8 percent between May and August 2012, increasing to 10 percent by the end of the year.

Since last December, the rate was maintained at 12 percent. The NFSC noted that the ongoing process of bad debt resettlement should take into account the circulation of capital in order to keep inflation in check.

The NFSC was optimistic about the 2013 goal to reduce inflation to 6.8 percent given the January and February consumer price index (CPI) was estimated at 7.04 percent and 7.02 percent, respectively.

The World Bank’s latest report predicted that market prices will not experience strong fluctuations this year, though the global food prices will rise, with the exception of rice.

Vietnam requests to establish panel for shrimp case with US

Vietnamese Permanent Mission to the United Nations in Geneva on February 27 asked for the establishment of a panel at an official meeting of the Dispute Settlement Body, aimed at resolving the shrimp case DS/429, in which the US side is the respondent.

Countries which registered to be third parties at the meeting include the European Union, China, Japan, Norway and Thailand.

The US Department of Commerce (DOC) is considering the imposition of anti-subsidy duties on certain frozen warm-water shrimp from Vietnam and six other countries after the US International Trade Commission (ITC) concluded that the US domestic shrimp production industry was suffering damage due to subsidised shrimp products imported from the seven countries including Vietnam.

Since 2004, Vietnam’s frozen shrimp has been imposed with anti-dumping duties. In case the US side concludes the shrimp is sold at a subsidised price at the US market, Vietnamese shrimp businesses will face more difficulties. The Vietnamese side also requested a review of the US side’s implementation of a verdict by the DSB over the case DS/404.

Vietnam officially requested consultations with the US concerning a number of anti-dumping measures on certain frozen warm-water shrimp from Vietnam with three key contents including zeroing, country-wide rate and sampling. The panel in the case made a verdict supporting two of the three contents.

HCM City pledges to facilitate Danish investment

Ho Chi Minh City People’s Committee Chairman Le Hoang Quan has pledged to implement every possible measure to make the Green House cooperative project between Vietnam and Denmark a lasting success.

He made the pledge during his meeting with Danish Minister of Foreign Affairs Villy Sovndal in HCM City on February 27.

Quan took the occasion to thank the Danish people for their positive support for Vietnam’s past struggles for national liberation, as well as its current course of construction and development.

Danish investors have so far invested in 35 projects with a total investment capital of US$185 million in HCM City. However, there is still further opportunities for trade partnerships between Danish and Vietnamese businesses in the city, Quan said.

At the meeting, the visiting Danish Minister praised the city’s development in recent years, adding that
most Danish investors appreciate the healthy business environment in Vietnam, especially in HCM City, which has lead to positive recommendations to form bilateral partnerships between the two countries.

The Minister said that there are about 130 Danish companies, businesses and offices operating in Vietnam.

Recently, the exchange of high-level delegations between the two countries has brought bilateral cooperation to a new level, ranging from politics, economics and culture to other fields, said Villy Sovndal.

The two countries will broaden their cooperation beyond the traditional areas of green growth to industry and seafood in the near future.

Gov’t proposed to raise stockpiled rice prices

The People’s Committee in the Mekong Delta province of Dong Thap has proposed the Government to instruct relevant organs to increase the floor price to purchase rice for stockpiling, aiming to ensure 30 percent profit margin for farmers.
 
The Vietnam Food Association said that businesses have bought 20 percent of the assigned volume at the price of VND4,500-5,400 a kilogram in the Mekong Delta. It is VND100-250 higher than the price before the rice stockpiling program was launched on February 20.

According to the Ministry of Finance, farmers have to spend VND3,134-4,474 to produce a kilogram of winter spring rice. The production cost is up to VND4,200 in Dong Thap Province.

The current rice prices fail to bring them the profit margin of 30 percent as per Government’s policy.

Duong Nghia Quoc, director of the Department of Agriculture and Rural Development in Dong Thap Province, said that the rice prices now can not bring farmers enough profit to make up for the remaining crops this year. Winter spring is the main crop every year.

In Kien Giang Province, traders pay famers only VND4,200 for a kilogram of the low-quality IR50404 variety.

Tran Quang Cui, deputy director of the Department of Agriculture and Rural Development in Kien Giang Province, said that farmers can obtain the 30 percent profit margin at the price of VND4,700 a kilogram.

At present, the Mekong Delta has harvested more than 700,000 out of 1.52 million hectares of winter spring rice. The remaining area is already in ear or ready for harvest.

Dong Thap and Hau Giang Provinces and Can Tho City are among localities having highest productivity-6.86-7.03 tons per hectare.

Finance ministry targets cost cutting on governmental assets

The Ministry of Finance has issued guidance on the purchases of public asset for this year insisting that due attention must be paid to saving expenses.

The guidance was issued in accordance with the government’s decree on measures to realise the country’s socioeconomic plans and state budget in 2013.

“No funding will be able for publically used means of transport out of the initial estimates even though the country has reported an increase in state budget revenues,” the ministry affirmed.

As a result, ministries, central agencies, and provincial people’s committees have been told to direct their subordinate agencies to strictly apply measures to save expenses.

Any assets purchased using state funding for the 2013 must be in accordance with approved estimates.

The purchases of public assets must follow current standards and quotas. Bought assets must be included in accounts and be properly used.

Ministers, top leaders of central agencies and provincial people’s committees that decide public asset purchases would be held accountable for their decisions, the ministry said.

The country intends to curb budget overspending at 4.8% of GDP.

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