US billionaire to expand operation in Vietnam

Ashley Furniture Industries CEO Todd Waneck is in Ho Chi Minh City to discuss the possibility of opening another factory in the southern province of Binh Duong.

He has met and worked with Pho Xinh CEO Duong Quoc Nam on a new plan for bilateral cooperation.

The two companies recently signed in the US a memorandum of understanding (MoU) on joint investment cooperation worth US$10 million last July.

Accordingly, a distribution centre for Ashley products will open in 2014 with a chain of home stores and galleries put up in Pho Xinh supermarkets across Vietnam.

Waneck has visited Binh Duong where his company will build a new factory as part of its plan to withdraw its labourers in China and raise its employment in Vietnam from 4,000 at present to 10,000 by 2015.

Established in 1945, Ashley Furniture Industries are co-owned by the father and son of Ron and Todd Waneck who were once listed in the Forbes top 400 richest people in the US with total assets of US$1.5 billion.

Last year Ashley ranked 115th among the biggest private companies in the US with its total revenue reaching US$3.5 billion.

Todd Waneck joined the company in 1979 and has been in charge of its external activities for two decades.

The Waneck family is also known as financial supporter for the US Furniture Political Action Committee (FurnPAC) and politicians.

In 2006, Todd Waneck was awarded by the City of Hope National Cancer Institute-designated Comprehensive Cancer Center for his sponsorship programme.

How to penetrate the German market?

Vietnamese goods, buoyed by growth in consumer demand, are facing plenty of export opportunity in the German market.

Seizing these opportunities requires a business focus on ensuring their products can meet German consumers’ strict quality and hygiene standards.

Germany is Vietnam’s largest European Union trade partner. Two-way trade turnover hit US$3.695 billion in the first half of 2013, up 29.51 percent on the same period last year.

The volume of Vietnamese goods exported to Germany was estimated at US$2.352 billion, accounting for 18 percent of total export earnings from the EU and most of them went up in value.

Electronic devices and associated parts achieved the highest growth rate of more than 130 percent, followed by paper (up 85.32 percent).

Telephones and spare parts also increased by 80.9 percent to US$873.49 million, accounting for 37.13 percent of Vietnam’s total export earnings from Germany.

Of the figure garments came second with US$279.44 million (11.88 percent). Other notable earners include coffee (US$223.71 million), footwear (US$197.51 million), and computers and electronic devices (US$131.82 million).

Vietnam’s imports from Germany include vehicles, machinery, and industrial equipment while its exports to the country remain at a modest level in the context of growing trade exchange between the two countries.

Vietnam’s Trade Office in Germany says export businesses need to study German tax policy, customs procedures, and regulations as well as German business culture.

Products exported to Germany have to meet general EU requirements for the use of recyclable and environmentally friendly materials in packaging and labeling

Packaging is a decisive factor behind export promotion at trade fairs in Germany.

Rice export contracts cancelled

Vietnamese businesses are unable to export 6.8 million tonnes as expected in the first seven months of the year due to the cancellation of rice shipments worth of nearly one million tonnes, according to the Vietnam Food Association (VFA).  

Most of the cancelled contracts were related to Chinese traders and the rest to Philippine traders.

To prevent this happening, the VFA has recommended that businesses carefully check the content of every contract before they decide to sign, especially with Chinese traders.

Nguyen Dinh Bich, a leading expert on rice exports said China will need more imported rice than last year and cannot purchase from other suppliers which are more competitive than Vietnam.

Vietnam in need of safe natural rubber standards

Vietnam needs to establish a national standard for protein-free natural rubber to ensure the safety of products made from it, a seminar related to a Japan-aided project heard in HCM City on August 21.

The “Establishment of Carbon-Cycle-System with Natural Rubber” project is being carried out at the Hanoi University of Science and Technology and Rubber Research Institute of Vietnam in cooperation with the Japan-based Nagaoka University of Technology.

The six-year project, funded by the Japan International Cooperation Agency and the Japan Science and Technology seeks to help Vietnam set a national standard for protein-free natural rubber. It will also present the latest research developments in evaluating rubber and methods to purify rubber, and enable the rubber industry to share their needs and knowledge.

At the meeting, Ngo Thi Ngoc Ha, deputy director of the Vietnam Standards and Quality Institute, said the country has not had a standard for protein-free natural rubber by which the safety of products can be measured.

The latest research on “de-proteinisation” method under the project will help create a standard, she said, adding that products made from natural rubber are environmentally friendly, but could cause latex allergy in people.

Prof Tran Van Top, vice president of the Hanoi University of Science and Technology, said the project includes five research groups, and its results would pave the way for future development of natural rubber in the country.

Prof Masao Fukuda, the programme leader, said the project aims to help Vietnam replace synthetic rubber made from fossil sources with natural rubber, enabling “green” development in the country.

Vietnam is a leading producer of natural rubber and the fourth largest rubber manufacturer in the world.

Hanoi sets sights on hi-tech future

The capital city of Hanoi is set to become a hi-tech centre of Vietnam in the near future.

To achieve this goal, it will increase the number of small and medium-sized enterprises (SMEs) operating in support industry to 300 by 2015 and 700 by 2020.

Once established and put into operation, the SMEs will be able to create high-quality products that meet regional and international standards.

To make the dream come true, Hanoi authorities will prioritise the development of sectors such as mechanics, electrical equipment, computing devices and high technology.

In addition to encouraging enterprises to attract foreign investment and apply advanced technologies, the city will offer them opportunities to access preferential capital for their production and business.

Plans are afoot to train a skilled labour force for enterprises. This year, 100 training courses on business administration will be held for 4,000 entrepreneurs and employees.

Capitalising on TPP agreement

The Trans-Pacific Partnership (TPP) agreement will create both opportunities and challenges for the local agricultural, garments and footwear sectors, a seminar was told in Ho Chi Minh City on August 21.

The event was jointly held by the Saigon Economics Times and the Vietnam Chamber of Commerce and Industry (VCCI) to shed light on updated information on TPP agreement.

Diep Thanh Kiet, Deputy Chairman of the Vietnam Leather and Footwear Association (Lefaso), said TPP will help improve the business climate in Vietnam. However, he said, local firms should promptly grasp opportunities and overcome challenges in a more open market after Vietnam joins this free trade agreement.

Since November 2010, Vietnam has been involved in official TPP negotiations together with New Zealand, Brunei, Chile, Singapore, Australia, Peru, the US, Malaysia, Canada, and Mexico, which are all potential markets for Vietnamese garments and footwear, he added.

According to Le Quang Hung, Chairman of the Management Board of the Saigon Garment Company, a number of free trade agreements Vietnam has signed has come into effect, creating more favourable conditions for local businesses to seek foreign partners and expand overseas markets.

Nevertheless, Hung said, these trade agreements will also create barriers against Vietnamese businesses, including tough competition, materials supply and labour force.

Regarding the agricultural sector, Van Duc Muoi, Chairman of the Ho Chi Minh City Food Association, pointed out that local farmers are among the most vulnerable during the international integration process because Vietnam’s agricultural sector is not sustainable and farmers are low-income earners.

Vietnam will find it difficult in TPP negotiations because its agricultural sector is usually provided with state subsidy. With strict technical barriers erected in the TPP agreement, the local agricultural sector will not benefit from tariff reductions, he said.

Muoi stressed that it is essential to have specific commitments for the agricultural sector and relax TPP members’ requirements.

Economist Pham Chi Lan noted that as global trade has shifted from trade liberalisation to trade facilitation, commercial value is based on such factors as added value and inter-dependence of industry, services and agriculture to create the competitive capacity.

She suggested local businesses build up new development strategies to take advantage of TPP when it is signed.

Shrimp exports may reach over US$2.4 billion in 2013

Vietnam earned US$291 million from shrimp exports in July, up 21.7% over the previous month and 45.3% year on year.

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), export revenue from this product hit nearly US$1.4 billion in the past seven months, rising by 14.7% compared to the same period last year. The figure is expected to surpass US$ 2.4 billion by the end of 2013.

In July, shrimp and crab saw remarkable export growth, while the export of Tra (Pangasius), tuna and octopus continued to experience a decline.

VASEP said 7-month shrimp exports made up almost 40% of total seafood export turnover, or a year-on-year increase of 5%.

The export price of shrimp rose in some key markets, notably up 17.2% in the US 16.7% in Japan, 8.7% in the European Union, and 36.7% in China and Hong Kong .

Tra fish exports reaped US$985 million, 0.6% lower than the same period last year due to capital shortages and reductions in global consumption.

The local seafood sector recorded a total export turnover of about US$3.5 billion in the past seven months, up 2.2% year on year.

Dong Nai attracts over US$786 million in FDI

By mid-August, southern Dong Nai province has lured US$786.76 million in foreign direct investment (FDI) capital, meeting more than 78% of its yearly plan.

According to the provincial Department of Planning and Investment, Dong Nai licensed 50 new projects worth US$364.28 million and 46 existing ones with an additional capitalisation of US$422.8 million.

Notably, there is a sharp increase in the number of projects that use a smaller workforce and have a little impact on the environment in the services, support and high-tech industries.

The province has given priority to environmentally friendly projects in high technology and support industry, which have high added value and use a little energy. It has stopped granting licences to projects which are likely to cause water pollution. Industrial zones without waste water treatment stations are not allowed to lure investors.

To attract more investors, Dong Nai creates a healthy business environment, accelerates administrative reform and supports business operations.

To achieve the target of attracting US$1 billion investment capital in 2013, the province pays more attention to cooperation, human resources training and infrastructure development.

It also increase dialogues  between management agencies and businesses to timely iron out snags.      

As July 20, Dong Nai had 1,358 FDI projects with a combined capitalisation of more than US$23,596 billion, including 1,045 valid projects worth US$19.25 billion.

Around 35 countries and territories have invested in the province, including Taiwan, the Republic of Korea, Japan, and ASEAN, European and American countries.

Prime Minister approves broadcasting services plan

The Prime Minister has ratified a plan for the development of radio and television broadcasting services in the country in the run up to 2020.

The plan, which was approved on August 19, aims to develop pay-for-view TV services in a sustainable manner and cater for the growing demand for entertainment.

It also aims to ensure a healthy and competitive environment, and prevent monopolies building up.

People will be encouraged to gradually change from terrestrial TV services to other kinds, as the country’s television stations will broadcast in digital in 2020 as set out in a different plan.

By 2015 there will be up to 80 popular TV channels and around 50 specialised pay-for-view channels for viewers to choose from.

The ratio and content of all foreign channels will be based on a full calculation of the paid service system under different periods. The paid TV services are targeted to reach up to 40% of population by 2015, and 70% by 2020.

A radio and TV services market will also be set up, allowing regulated, healthy competition.

The next step is for the sector to mobilise investment capital and improve service quality.   

UNDP further supports Vietnam’s environmental projects

The United Nations Development Programme (UNDP) in Vietnam will consider new projects proposed by the Vietnamese side in the fields of climate change and preserving bio-diversity.

UNDP Country Director Louise Chamberlain made the pledge at an annual session in Hanoi on August 20 with the Ministry of Natural Resources and Environment to review results of cooperation and work out a new plan of action.

Deputy Minister of Natural Resources and Environment Tran Hong Ha asked the UNDP to further support Vietnam in setting up measurements of the development of its green economy in the near future.

The ministry proposed five projects to the UNDP which are aimed at reserving significant wetlands, improving the implementation capacity of the Rio Convention in Vietnam and the climate change strategy, reducing the harmful effects of pesticide chemicals and making good use of natural resources sharing.

The UNDP has been supporting at least seven environment-related projects in Vietnam.

Louise Chamberlain said these projects are on the right track to help build climate change response capacity and reduce the level of environmental pollution in dioxin-contaminated areas.

For other projects that are underway, she urged the Ministry to shorten the appraising and approval time to make it possible for them to get off the ground soon.

Global shipping industry sets sail under new standard

The ILO’s Maritime Labour Convention – comes into force, ensuring protection for the world’s 1.5 million seafarers and fair competition for shipowners.  

The International Labour Organization’s Maritime Labour Convention (MLC, 2006) comes into force on 20 August 2013, inaugurating a new era of decent work for seafarers and fair competition for shipowners in the global shipping industry.

“This Convention is a milestone in maritime history”, said ILO Director-General Guy Ryder. “The product of tripartite dialogue and international cooperation, it enables decent working and living conditions for seafarers to be advanced, along with fair competition for shipowners in this, the most globalized of industries”.

The new Convention becomes binding international law as of 20 August. It needed ratification by 30 ILO member States, representing more than 33 per cent of global gross tonnage to enter into force. To date, more than 45 ILO member States representing over 75 per cent of global gross shipping tonnage have ratified the Convention.

The Convention has the full support of the International Transport Workers’ Federation (ITF), which represents seafarers, and the International Shipowners Federation (ISF), both of which played a key role during the five years of its development and in the adoption of the Convention at a special ILO International Labour Conference in 2006.  It also has the strong support of the International Maritime Organization (IMO).

According to the Viet Nam Maritime Administration, the country has nearly 32,000 licensed seafarers including about 27,000 still working in national flag and international vessels. Its 1,700 national flag ships cover one tenth of the country’s exports and nearly half of container goods on domestic routes.

Prime Minister Nguyen Tan Dung on 25 July approved the national MLC implementation plan. The important blueprint requires an overall upgrading of domestic marine laws by 2015; comprehensive assessment and certification for all Vietnamese ships in 2013; the establishment of a tripartite consultation mechanism involving representatives of the Government, ship owners and seafarers this year; and investment in public information and entertainment structures for seafarers at sea ports by 2020.   

Healthcare projects need VND7,500 billion

An August 20 Health Ministry meeting in Hanoi, reviewing its activities during the first half of 2013, has heard the healthcare sector requires more social investment to overcome current capital shortages.

Participants revealed a number of healthcare projects have yet to be completed because of these difficulties.

The investment shortfall for approved projects currently totals around VND7,500 billion, including VND4,500 billion for healthcare services, VND1,500 billion for training, and VND1,000 billion for science and technology research

The capital allocated to the medical sector was cut by 20 percent to VND8,512,46 billion in 2013. Funds mobilised from government bonds amounted to only 25 percent of last year’s figure.

The first six months of 2013 saw the disbursement of VND3,850 billion, the equivalent of 45.23 percent of the estimated yearly expenditure.

Netherlands funds fresh water project in Ba Ria-Vung Tau

The Netherlands will provide non-refundable aid worth nearly VND260 billion (US$12.38 million) for the building of two water plants in the southern coastal province of Ba Ria-Vung Tau.

An agreement to this effect was signed between the Dutch Consulate General in Ho Chi Minh City and the provincial People’s Committee on August 20.

The first plant, with a capacity of 20,000 cu.m per day, will be located in Long Tan commune, Dat Do district, while the second one, in Bong Trang commune, Xuyen Moc distrct, has a capacity of 5,400 cu.m per day.

Once completed, the two works will provide fresh water for daily life and production for 35,000 local rural households.

According to Timvan Galen, Chief Advisor of the Dutch government-funded programme, ORIO, the project is one of the first seven ones signed by ORIO all over the world. It is currently funding 66 projects worldwide, focusing on fresh water, health care and energy.    

Vietnam’s seafood output to hit 7 million tonnes in 2020

Vietnam’s fisheries sector is expected to produce seven million tonnes of seafood by 2020, a newly-approved master plan has set out.

Of this figure, aquaculture will make up 65 percent, according to the sector’s master plan from now until the end of the decade, with a vision towards 2030.

Under the plan, which was ratified by the Prime Minister on August 16, the country’s fisheries exports are projected to rake in 11 billion USD by 2020 with an average growth rate ranging from 7-8 percent.

The sector will be industrialised in 2020 and modernised in 2030 while continuing its comprehensive, effective and sustainable development with a high competitive edge to firmly integrate into the global economy.

The plan aims to improve the living standards of fishermen, protect the country’s ecological environment and contribute to the safeguarding of the country’s national defence and security at sea and on islands.

Up until 2020, about half of fisheries workers will be trained and the average per capita income will triple.

From 2020 through to 2030, the sector’s total output is expected to reach 9 million tonnes, of which 70 percent will come from aquaculture. Export turnover in that timeframe is projected to climb to about 20 billion USD.

Training courses will be designed for around 80 percent of workers in the sector, the plan said.

The PM has assigned ministries and municipal and provincial People’s Committees to work together in implementing the master plan, which also focuses on areas such as seafood production, processing and commerce, infrastructure, services and logistics.

Measures will be put in place to ensure the effective development of science-technology, environmental protection, production management and international cooperation.-

Toll collection right auction launched

The Ministry of Transport just kick-started the auctioning process relevant to Ho Chi Minh City-Trung Luong expressway’s toll collection right handover.

As of this time, setting an adequate traffic volume growth level for the road remains the only entanglement in establishing the auction’s starting price, according to the ministry (MoT).

The Cuu Long Corporation for Investment, Development and Project Management of Infrastructure (Cuu Long CIPM), which was trusted to pen the auction project, proposed a 6 per cent hike in annual traffic volume along the road.

It temporarily set the auction’s starting price for acquiring the right on toll collection in fight years from October 1, 2013 at VND1.603 trillion ($76.3 million) which was based on 2012’s actual toll amount and a combination of factors such as an 8 per cent interest to investor’s capital investment, 10 per cent value added tax and 6.6 per cent collection expenses etc.

Successful investors shall take charge of fulfilling payment within six months in three rounds, of which 40 per cent of the contract value must be paid in the first round right after the contract becomes valid.

Cuu Long CIPM’s deputy general director Duong Thi Tram Anh viewed the 6 per cent annual traffic hike proposal as reasonable as the National Highway 1 which runs parallel to the Ho Chi Minh City-Trung Luong highway is still toll free so it would continue attracting a huge volume of traffic.

Deputy head of Ministry of Finance’s Department of Public Asset Management Nguyen Tan Thinh did not satisfy with the proposal, arguing that the developer should mull higher traffic volume growth to bolster the road’s usage efficiency.

Thinh also said bright development perspective would also spur the traffic volume.

Deputy Minister of Transport Nguyen Hong Truong was reported to propose Cuu Long CIPM apply 8 per cent traffic growth hike when setting the auction starting price, which will see Cuu Long CIPM’s auction starting price jump by an additional VND30 billion ($1.4 million).

Despite these arguments, the auction of Ho Chi Minh City-Trung Luong expressway’s toll collection right is forecast to garner investors’ special attention.

Cuu Long CIPM statistics show that in July 2013 the expressway attracted around 32,830 car equivalents each day, of which below 12 set cars accounted for 35 per cent.

Toll collection on the road came to around VND1.1 billion ($52,300) each day in July though it was not a peak period for traffic.

“At least two foreign investors have showcased interests into the auction,” Anh said.

To complete the handover before December 2013, MoT Deputy Chief Nguyen Hong Truong had asked Cuu Long CIPM to shortly complete the auction project and inform of the auction on local media no later than October 1, 2013.

The auction slated to take place one month later on November 1, 2013.

“The auction is open to every individual and business having real capacity and demand,” Truong underscored.

The Ho Chi Minh City-Trung Luong expressway, part of the north-south highway network, connects Ho Chi Minh City to Tien Giang province in the Mekong Delta. Its construction cost was around VND10 trillion ($476 million)

Construction of the project kicked started in December 2004 and the 50 kilometre long expressway was open to traffic from February 2010.

McDonald's selected as official recruitment partner

American fast-food giant McDonald’s has chosen, a leading recruitment network in Southeast Asia which has entered the Vietnamese market, as its official recruitment partner.

Vietnam has searched and screened potential and talented candidates for the first two positions of McDonald’s in Vietnam: Assistant Manager and Crew Leader.

The choice of McDonald's reflects the quality and prestige of to Vietnamese corporations and employees in recent years.

Piloting in the process of applying technology for service quality improvements, has recently launched the official "Rich Information Recruitment Form" called as Rich Job Ads.

With many new functions like suggested salary, location maps and rich corporate data, the users can obtain full information about prospective employers that they have interest in a swift manner.  

McDonald’s is the world’s leading global foodservice retailer with over 34,500 locations serving more than 69 million customers in more than 100 countries (37 in Asia) each day.

Vietnam was reported to be the latest among over 65 markets in which McDonald’s has employed the development licensee model.

In August 2012, McDonald’s senior officials came to Vietnam and said of the plan to enter the local market with two outlets in Ho Chi Minh City and eventually expand to 100 outlets nationwide.

Poor regulations handicap investors

It is high time for State agencies to improve the country's investment environment by creating a consistent sequence of investment procedures nationwide, a conference heard yesterday.

Chairman of the Viet Nam Chamber of Commerce and Industry (VCCI) Vu Tien Loc said the country's bureaucratic investment procedures were obstructing both domestic and foreign investors who wanted to do business in Viet Nam, holding back the country in comparison with other ASEAN members.

While once one of the most attractive investment destinations in Southeast Asia, the country was now ranked in only a modest position, Loc said at the conference held by the chamber, where experts and enterprises joined together to suggest administrative reforms that they believe would make the environment more attractive to investors.

Of more than 8,000 domestic enterprises and 1,500 foreign companies surveyed in 2012, 33 per cent of the former and 28.3 per cent of the latter found the investment licensing procedure to be the most burdensome and complicated.

These figures were announced by Dau Anh Tuan, deputy head of the VCCI's Legal Department, who also noted that often contradictory investment licensing regulations appear in five laws, 10 decrees and nine circulars.

He added that to start a project, enterprises have to complete at least 18 major administrative procedures at the ministries of Investment and Planning, Construction and Natural Resources and Environment.

These stages included seeking a location, requesting land use rights, making an environmental assessment and submitting a detailed investment plan for approval.

Tuan argued that the complicated process was not only very costly for enterprises but also made it impossible for them to set realistic time frames for their projects, creating missed business opportunities.

Deputy Chairman of the Viet Nam Contractors Association. Nguyen Quoc Hiep - also the director of a real estate company - said that it once took 14 months for his business to receive investment approval from five different agencies.

"In this case everything ran smoothly and it still took a very long time. If any problems are thrown up then the time is even longer still," Hiep said.

"There are too many directive documents to provide clear guidance. They are confusing even to domestic investors like me so how can foreign investors abide by our laws?"

Tuan said that the overlaps in procedures could be attributed to a shortage of information sharing within and between State agencies.

He also acknowledged that in different localities a different sequence of procedures were often required using different documents.

He claimed that without one agency controlling the whole process there would always be a weakness in supervising and assessing domestic projects.

Maria Soo Chung, an associate of Baker & McKenzie Vietnam Ltd's Ha Noi branch, said different licensing procedures exist for domestic and foreign investors.

She said that the latter would always aim to seek the simplest, shortest and most cost efficient way to carry out their investment, meaning that they would soon become frustrated if legally required to begin a long-winded certification process.

"Administrative procedures concerning project implementation, such as land, construction, imports and exports are still unclear and in some cases, incoherent and incompatible with one another," she pointed out.

"We hope that Viet Nam can continue on its current path of legal reform to make administrative procedures more transparent and predictable," she stressed.

Tuan suggested the investment procedure must be simple, systematic and consistent nationwide. He said that this would help save time for both State authorities and enterprises while preventing the risk of corruption.

Nguyen Hung Hue, a representative of the Ministry of Justice's Department for Administrative Procedure Control, noted that investors were often placed in a disadvantaged position because they did not have any tool allowing them to supervise the performance of State agencies.

He too called for the removal of the existing procedural obstacles.

"It is necessary to establish and maintain only one channel to provide information about the regulations and the results of applications."

Hue estimated that if the time to complete procedures was reduced by one third, enterprises could save more than VND1 trillion (US$47.6 million) per year.

Viet Nam finds free trade has tax handicap

Viet Nam's agricultural exports are facing challenges due to export tax rates reached in Free Trade Agreements (FTAs) with other countries.

The assessment was announced by experts at a conference on rural and agriculture policies in the integration process yesterday.

It was based partially on reports on the impacts of tax barriers in FTAs on agriculture made by the Institute of Policy and Strategy for Agriculture and Rural Development (Ipsard) and the Australian National University.

Pham Thi Ngoc Linh, an expert from Ipsard, said the country was suffering from FTAs with other countries, especially in terms of tax rates.

This had led to taxes on agricultural imports witnessing a sharp decrease to 0-10 per cent on products such as beef, dairy products and rice, she said.

Most of the country's agricultural exports to FTA partners are subject to tax rates of 5-15 per cent, and sugar, dairy products, vegetables and meat had to suffer taxes of 30, 23 and 18 per cent, she said.

She forecast that Viet Nam's trade deficit with its four FTA partners including ASEAN, China, South Korea and Japan would reach US$4 billion by 2017.

The total export turnover for forestry-agriculture-aquatic products would increase by US$15-17 billion, she said.

The volume of agricultural exports to ASEAN countries is expected to surge by 18-20 per cent, while the volume of rice exported to China will be up 25-30 per cent, vegetables 15 per cent and dairy materials nearly 50 per cent.

Dang Kim Son, director of Ipsard, said tax reductions for the country's FTA partners had facilitated many foreign companies to do business and export agricultural products to a third country.

Small-scaled production, dated technology and a lack of funding had multiplied the challenges for the country's agricultural production, he said.

Deputy Minister of Agriculture and Rural Development Nguyen Thi Xuan Thu said the ministry had been restructuring the agricultural sector to make it more competitive.

Experts also suggested that protectionism be replaced by development policies of production and value chains.

Economic downturn does not deter Vietnamese TV buyers

Viet Nam imported 62,000 television sets last month, a 35 per cent year-on-year rise and the highest number for any month this year, according to the Ministry of Industry and Trade.

GfK Research Company reported that TV imports saw the strongest growth in the electronics sector, adding that it was due to the launch of a clutch of LCD, LED, and 3D models by big brands like Sony, Samsung, LG, Toshiba, and Sharp with new features, economical operation, and attractive designs.

Le Tung, marketing director of Topcare, a Ha Noi-based electronics retail chain, said TV sales have not been hit by the economic downturn.

Topcare sold around 2,200 sets last month, and expects to sell not less than 10,000 in the fourth quarter.

Dau tu (Viet Nam Investment Review) newspaper attributed the strong sales to promotions by retailers.

Topcare, for instance, is offering discounts of 4-27 per cent on most TVs.

Media Mart electronics chain is also offering discounts starting at 10 per cent on Samsung and Sony TVs this month.

US continues price dumping probe

The United States International Trade Commission (USITC) has determined that there is a reasonable indication that US industry is materially injured by reason of imports of certain oil country tubular goods (OCTG) from Viet Nam and other import nations.

According to the Viet Nam Competition Authority (VCA), Viet Nam was accused of price dumping of between 103 and 111 per cent. This will directly affect 16 domestic steel manufacturers and nearly 7,500 workers.

It is said that imports of OCTG from Viet Nam and other countries and territories including India, South Korea, the Philippines, Saudi Arabia, Taiwan, Thailand, Turkey and the Ukraine are allegedly sold in the US at less than fair value.

The US Department of Commerce (DOC) officially started anti-dumping duty investigation into OCTG imported from Viet Nam, South Korea, India, Turkey, Taiwan, Ukraine, the Philippines, Saudi Arabia and Thailand.

The move was made after some US steel and steel pipe producers had lodged complaints against those countries on dumping OCTG to DOC on July 2.

As a result of the USITC's affirmative determinations, DOC will continue to conduct its investigations on imports of these products. It's expected to issue the preliminary conclusion in December and the final one will be given in February 2014.

Last year, Viet Nam exported 199,000 tonnes of OCTG to the US, earning a turnover of US$189 million and accounting for 12 per cent of the country's imports of the product.

Since 2011, the Vietnamese steel sector has faced four anti-dumping lawsuits. Three previous lawsuits were on carbon-welded steel pipes, steel-wire garment hangers and welded, stainless steel pressure pipes.

Coal production down 4m tonnes

The Viet Nam National Coal and Mineral Industries Group (Vinacomin) is expected to produce only 39 million tonnes of coal this year, a significant drop of 4 million tonnes.

The Ministry of Industry and Trade released the sales figures, 9.3 per cent lower than targeted, which will come as a slight disappointment to the mining giant.

About 10.5 million tonnes of the total coal was for export and 28.5 million tonnes consumed domestically. Last month saw the lowest coal consumption this year with 2.1 million tones, only 0.25 million of which were for export.

Vinacomin expects to earn VND97.9 trillion (US$4.64 billion) this year, meeting 93.8 per cent of the yearly target. Its coal operations will generate VND53.4 trillion of the total.

Despite the drop in coal consumption, the corporation is still set to make a targeted profit of VND2.5 trillion on coal, aiding Vinacomin's VND10.78 trillion contribution to the State budget.

Vinacomin said the low figure was due to higher export tax rates of 13 per cent being applied from July 7. It was forced to halt its coal exports as its costs were almost equal to export prices.

The group last week proposed lowering coal export taxes to 10 per cent in order to lift coal consumption by the end of the year.

At a meeting with Deputy Prime Minister Hoang Trung Hai in coal mining Quang Ninh Province, Tran Xuan Hoa, Vinacomin's Members Council chairman declared that the move was essential to halt declining coal sales.

Land handed over for delayed Long Son petrochemical complex

The People's Committee of southern Ba Ria-Vung Tau Province has handed over 400ha of land to the Long Son petrochemical complex project, which has an investment of US$4.5 billion.

Kan Trakulhoon, President of Thailand's Siam Cement Group (SCG), the main investor in the project, said final negotiations were being completed over equipment supply packages, with work on the project expected to start early next year.

Work on the complex based in Long Son Oil and Gas Industrial Zone was initially set to start in 2009, with production scheduled to begin in late 2012. However, the complex has fallen behind schedule due to issues related to site clearance.

The complex aims to help meet the growing demands of local industries for high-quality plastic resins, valued at up to $2 billion annually.

It will consist of a factory capable of turning out 1.65 million tonnes of olefins, 1.45 million tonnes of polyolefins, 280,000 tonnes of chlor-alkali and other materials each year. There will also be support facilities including a port, warehouse and power plant.

Currently, SCG holds more than a 28 per cent stake in the complex while the remaining interest belongs to Qatar Petroleum, Viet Nam National Oil and Gas Group (PetroVietnam) and Viet Nam National Chemical Group (Vinachem).

Kan said that the complex was a major project SCG has pursued during the past six years.

VietinBank to shift $14m

VietinBank has received approval from the State Bank of Viet Nam (SBV) to contribute supplementary capital worth US$14 million to Indovina Bank Ltd (IVB) so that it can raise its charter capital as approved in January.

The Ha Noi-based bank, officially known as Viet Nam Joint Stock Commercial Bank for Industry and Trade, must carry out procedures in accordance with current laws, the central bank said in a post on its website.

SCB offers insurance

Saigon Commercial Bank (SCB) is offering insurance products at its transaction points following an agreement signed with Vietcombank Cardif Life Insurance Company (VCLI) last Friday.

VCLI is a joint venture between Vietcombank, BNP Paribas Cardif and SeABank.

Le Khanh Hien, general director of SCB, said that the agreement aimed to help diversify business operations of the bank.

SCB customers can now buy bank products with insurance benefits attached or independent insurance products from VCLI.

Vietnamese-Malaysian trade booms

Vietnamese businesses are being encouraged to invest strongly in Malaysia in order to capitalise on the nation's rising import demands.

The Viet Nam Chamber of Commerce and Industry (VCCI) says Malaysia imported goods worth US$168 billion in 2011, a rise of $51 billion from 2009.

For the first time in decades, last year Viet Nam achieved a trade surplus of over $1 billion with Malaysia. Two-way trade also rose 17 per cent in 2012 to $7.9 billion.

Statistics from the Viet Nam Customs Department show that bilateral trade continued to flourish in the first seven months of this year, with Vietnamese exports generating $2.87 billion.

Major exports include crude oil, rubber, rice, computers and spare parts, phone handsets, coffee, seafood, steel, vehicles, machinery and equipment.

Viet Nam mainly imports oil and fat, petrol, chemicals, plastic materials, timber and dairy products from Malaysia.

Shazryll Zahiran, Malaysian Consul General in HCM City, says the two countries have signed a total of 13 bilateral agreements, creating plenty of opportunity for an increase in bilateral co-operation in investment, trade, banking, education, tourism, labour, sports, security and national defence.

Vu Van Canh, a Vietnamese trade counsellor in Malaysia, says bilateral trade is expected to reach a record high this year as the Malaysian economy has already recovered from the global economic slowdown and is developing well.

According to Canh, two-way trade this year is estimated to hit up to $9 billion, of which $5.2 billion is from Vietnamese exports.

As of July 20, 2013 Malaysia had invested in 445 projects capitalised at $10.2 billion in Viet Nam, ranking it eighth among foreign investors and second among ASEAN backers in the country.

By March 2013, Viet Nam had nine investment projects in Malaysia, worth a total registered capital of $413 million.

New farming models set for Mekong Delta

The Ministry of Planning and Investment and local governments in the Cuu Long (Mekong) Delta plan to set up three new co-operative models for farming fruits, tra fish, and rice.

One of the tasks under a project to improve the condition of local people, it will be carried out in two phases in Can Tho city and the delta's 12 provinces.

The first phase, which began in July and will end in October, involves appraising the Delta's collective economy and functioning of existing co-operatives and proposing new co-operative models for the region's three key products.

The second phase, to go on until July 2016, will see implementation of the new models.

The delta's individual economy has developed well and the region has designated special areas for growing rice and fruits and aquaculture, according to the ministry.

But people are still poor and do not have stable incomes because they do not have stable markets for their products.

Deputy Minister of Planning and Investment Dang Huy Dong blamed this on individual farmers failing to co-operate.

Besides, no organisation has come forward to instruct farmers in effective production methods, he said.

The 2012 Co-operative Law offers a suitable model for fixing these problems by providing members of co-operative inputs at low prices, production techniques and technologies, and guaranteed outlets, he added.

Can Tho and the 12 provinces have 1,300 co-operatives with 23,260 members and 45,000 co-operative teams, according to the Southwestern Region Steering Committee.

Full-fledged co-operatives should have at least seven members while those with at least three are considered co-operative teams.

Only 2-5 per cent of farmers in the Delta are members of co-operatives, with the main hurdles to membership being low education standards and poor management of the co-operatives, local authorities said.

Huynh Chi Nguyen, deputy director of the Hau Giang Province Department of Agriculture and Rural Development, said most of the province's 106 co-operatives are small and have difficulty in finding regular outlets for their produce.

Besides suitable mechanisms and policies, human resources are also a key aspect in developing co-operatives, he said.

Ngo Hong Chieu, deputy director of the Dong Thap Province Department of Planning and Development, said people with money and education prefer to set up their own companies and rather than join co-operatives.

Of the province's 200 co-operatives, only a few have chairpersons with a university degree, he pointed out.

Most co-operatives offer basic services like pumping water and supplying breedstock and seeds.

It is difficult for them to attract members since most cannot find stable markets for their produce, he reiterated.

Nguyen Quoc Hai, chairman of the Can Tho City Cooperative Alliance, said problems related to policies, funding, and human resources and a lack of successful model.