The Law on Public Debt Management should endorse several legal documents into law and add new content acquired through international experience, Deputy Finance Minister Truong Chi Trung told a workshop in Hanoi on September 21 reviewing five years of its enforcement.

Victoria Kwakwa, Country Director of the World Bank in Vietnam, urged Vietnam to improve its fiscal policy and pledged to provide technical support to the Finance Ministry in public debt management with a view to ensure debt safety and national financial security.

Participants debated ways to create a synchronous legal environment and a set of good practices in lending administration.

Truong Hung Long, Head of the Finance Ministry’s Department of Debt Management and External Finance (DMEF), credited the law with making public debt lending and payment activities more open and transparent.

In late 2014, public debt stood at more than 2.3 trillion VND (104.5 million USD), or 59.6 percent of the gross domestic product (GDP). The figure is predicted to rise to 62.3 percent later this year, which is still below the 65 percent ceiling set by the National Assembly.

The law has also broadened the scale of the domestic bond market from 2.8 percent of GDP in 2001 to 19 percent in 2011 and 21.2 percent in 2014. The government bonds and government-guaranteed bonds market made up nearly 19 percent of GDP last year.

Long pointed out existing flaws related to the debt ceiling, debt management skills and the relationship between debt management and fiscal policy.

He also requested the rights and responsibility of legislative and judicial agencies, ministries, agencies, localities, businesses and public debt users be clarified.

The event was co-hosted by the DMEF and the WB.

Chan May port inaugurates upgraded wharf

Wharf No.1 at the Chan May Port in central Thua Thien-Hue province was re-opened on September 21 after a 310 billion VND (14.2 million USD) upgrade, ready to receive large vessels carrying up to 4,000-5,000 passengers each.

The Royal Caribbean International Group invested 5 million USD in the upgrade, which increased the wharf’s length from 300m to 360m, dredged an area of 90mx450m in front of the wharf and expanded the turning area.

The port now can accommodate Quantum- or Oasis-class super-large ships, which is expected to help Thua Thien-Hue province achieve its target of 60,000 sea-bound tourists through the Chan May Port this year.

The port is among 46 sea ports in South East Asia chosen by the Asia Cruise Association as stops for pleasure boats.

Consultancy deal on Dung Quat oil refinery expansion signed

A consultancy and supervision contract was signed on September 21 for the Front End Engineering Design (FEED) phase of the Dung Quat Oil Refinery upgrade and expansion project in the central province of Quang Ngai.

Accordingly, the US Quad Personnel Consultants company and the domestic Giac Thanh Co. Ltd will play roles as advisors in a deal worth 50 billion VND (about 2.25 million USD).

The consultancy will be implemented in tandem with the FEED contract signed earlier between the UK-based Amec Foster Wheeler Energy Ltd. and Binh Son Refinery Company, a unit of PetroVietnam.

The Dung Quat Oil Refinery expansion and upgrade project is worth 1.8 billion USD, which is expected to increase the plant’s annual processing capacity from 6.5 million tonnes of crude oil to 8.5 million tonnes.

Besides existing products which will meet international standards and the EURO 5 criteria, the project will also help produce plastics, tar, A97 and A98 gasoline and special materials used in military and defence.

The expansion project is scheduled to be completed by 2021.

Vietnam to be Country of Honour at CAEXPO 2016

Vietnam will be Country of Honour at the 2016 China –ASEAN Expo (CAEXPO), Secretary General of the CAEXPO Secretariat Wang Lei announced on September 21.

Addressing a press conference in Nanning city, the Chinese province of Guangxi where the CAEXPO 2015 was recently held, Wang said the decision was reached during the 12th CAEXPO senior officials’ meeting on September 20.

The Country of Honour mechanism was first introduced at the CAEXPO 2007 in order to make it easier for the country to popularise its images during the event. It is chosen alternately among 10 ASEAN member countries, including Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

This year, Thailand was named as the Country of Honour.

According to Wang, the CAEXPO 2015 attracted 85 groups of investors and buying mission, up 5 percent last year.

Popular products such as rice, coffee, wooden furniture and handicrafts, as well as China’s packaging and food processing equipment and electronics and electrical appliances grabbed the attention of buyers.

Many deals were signed, including a memorandum of understanding between the Bank of China’s Bangkok branch and the China – ASEAN Investment Cooperation Fund, and 34 projects involving machinery production, automobile spare parts and construction materials.

Fringe events include 27 thematic seminars and forums featuring China – ASEAN cooperation across investment, e-commerce, electronics, pharmaceuticals, mining, finance and tourism, together with 84 trade promotion and investment programmes.

Initiated by China, the first CAEXPO was held in Nanning in 2014 in order to promote a free trade zone between the two sides.

The event has since become an annual platform for thousands of Chinese and ASEAN businesses.

Vietnamese enterprises seek business opportunities in Australia

A number of Vietnamese enterprises in various fields joined the Fine Food Show 2015 which is underway in Sydney, Australia from September 20-23.

Many leading seafood businesses of southern most Ca Mau province display and introduce their products at the event, including the Ca Mau Seafood Processing and Service Joint Stock Company (CASES), the Ca Mau Frozen Seafood Processing Import-Export Corporation (CAMIMEX) and the Trong Nhan seafood company.

Other Vietnamese businesses operating in food, apparel or building materials also attended the event to study the market, seek partners and expand their business in the foreign country.

Chairman of the Vietnam-Sydney Business Association (VSBA) Le Huu Canh said he hopes that through the show, the VSBA could bridge the two countries’ enterprises and speed up contract signings.

Started in 1984, Fine Food is one of Australia’s annual leading trade shows for the food service, hospitality and retail industries that presents new and innovative products from Australia and over 45 foreign countries internationally, as well as live demonstrations, master classes and industry-recognised competitions.

This year’s event attracted over 1,000 suppliers in the fields of food processing, presenting a chance for enterprises to connect, introduce products and access the latest technologies.

Master plan for Mong Cai border gate economic zone approved

The Prime Minister has signed a decision to approve a master plan for building the Mong Cai border gate economic zone in the northeast province of Quang Ninh by 2030, a drive to make the zone a proactive and key economic growth pole in the north.

The 121,197 hectare zone will cover 17 wards of Mong Cai city, Hai Ha industrial zone and seaport, Quang Ha town and a number of communes in Hai Ha district.

It is set to include a tax-free area, industrial zones, a financial centre, an administrative centre, a residential area and other functional areas.

In addition, it will accommodate modern and comprehensive facilities with excellent service networks and diversified tourism products. Once operational, it will improve resident living standards while playing an important role in defending Vietnam’s sea and island sovereignty.

EVN cuts installation time to 10 days

The Electricity of Vietnam (EVN) will reduce installation times for customers to access the medium-voltage transmission network from 18 to 10 business days in response to Government Resolution 19 to improve the business environment in Vietnam.

Electricity connection procedures will also be cut from five to four steps, which now include application submission, site visit, technical and design negotiation, installation and signing of electricity supply contract.

Customers can find information regarding procedure and application requirements in all EVN branches and on its official website where they can track the progress of their application online.

The state-owned company has worked hard to improve the electricity-access index in recent years, resulting in installation time reductions for medium-voltage line connection from 55 to 18 working days in 2014.

In the first seven months of 2015, the average time for customers to gain electricity access was 10.3 days.-

First LEED building project announced in Vietnam

An apartment project that meets the Leadership in Energy & Environmental Design (LEED) standards, the US’s most popular and widely-used green building rating system globally, will be implemented for the first time in Vietnam.

Phuc Khang Corporation, the project’s investor, and Green Consult Asia under the US’s Green Building Council inked a contract on September 20 to develop the nearly 1.3-trillion-VND (57.2 million USD) project in District 8, Ho Chi Minh City.

Phuc Khang Corporation General Director Luu Thi Thanh Mau said the Diamond Lotus project will be blanketed by green with its apartments designed to welcome direct sunshine, wind and fresh air as if they were villas in the air.

Covering 1.68 hectares, the project includes three blocks connected at the top by a 5,000-square-metre sky park, she said.

Melissa Merry Weather, Director of Green Consult Asia, said the LEED certification is used to assess building projects in their design, construction and operation, aiming to reduce up to 30 percent of total energy use and a half of total water use, creating environmentally-friendly living conditions.

The standard has been applied in 135 countries, including the US, with more than 60,000 projects, she said, noting LEED building projects are critical in a populous country like Vietnam to ensure sustainable development.-

Binh Duong: industrial production rises 13.8 percent

The value of industrial production in the southern province of Binh Duong has hit over 152 trillion VND (6.68 billion USD) for the first nine months of the year, up 13.8 percent on a yearly basis.

According to the provincial Department of Industry and Trade, the domestic sector accounted for 50 trillion VND of the figure, a rise of 12.3 percent, while the foreign-invested sector posted 103 trillion VND, up 14.6 percent.

Two-digit growth of 12 out of 27 groups of key products of the locality contributed to the high increase of total industrial production. Semiconductors, refrigerating equipment, footwear, wooden furniture, steel, garment-textiles and bags saw increases between 10-31 percent.

The department expected good growth of a number of key local exports such as footwear, textiles, handicrafts, and wooden products as most involved enterprises have already inked contracts for the remaining months of the year.

As a result, total industrial production value for the year can reach 216 trillion VND (9.5 billion USD), up 15.5 percent year-on-year.

Binh Duong is now home to 19,500 domestic projects with total investment of more than 144 trillion VND (6.3 billion USD), and 2,511 foreign-invested ones worth 22 billion USD.

Central Highlands faces diminishing cashew land

The decline in cashew-growing lands in the Central Highlands region and the resulting short supply has forced a number of cashew processing firms to close over the past five years, according to the Central Highlands Steering Committee.

Dozens of cashew producers have gone out of business since 2010, leaving only 20 in the market to produce more than 55,000 tonnes of processed cashews annually.

Approximately 70,700 hectares of cashew cultivation areas remain in the region, down 20,000 hectares from 2011, including 12,000 hectares in Dak Lak province.

The decrease was due largely to the dramatic fall and prolonged instability of cashew nut prices alongside low yields of only 1-1.3 quintals per hectare.

Many cashew growers have switched to higher income crops. In Ea Sup district, where most of Dak Lak’s cashews were grown, 10,000 hectares of cashew have been cut down for rubber and paper-making wood over the past five years.

To reverse the trend, the Steering Committee asked authorities of Central Highlands provinces to help local cashew farmers shift to new high-yielding cashew varieties, such as PN1, AB29, AB05-08, ES-04 and EK-24, and apply advanced cultivation techniques to improve productivity.

Soft loans should also be provided for the farmers, the committee suggested.

In the first half of this year, the country shipped abroad 15,000 tonnes of cashew nut for 1.08 billion USD, showing increase of 14 percent and 28.2 percent, year on year, respectively.

Vietnam cashew products have been present in over 50 countries worldwide with the US, China and the Netherlands as the largest importers.

The dwindling cashew-growing area led cashew processors to import raw cashews, resulting in the instability in price and the quality of finished products for exports.

Supermarkets selling clothes

Garment producers now have a new strategy to improve both brand recognition and sales – selling through super-markets.

Tran Thi Thuy Trang, director of Dan Chau Fashion Co said though her company has 20 stores, its products are present in almost all supermarkets in the south.

Thuy Nga, head of business development at Sanding Co said her company's sales of school uniforms through the Co.opMart supermarket chain increased by 10 per cent a year.

Most companies agreed that distribution through supermarkets improves brand recognition because they are always crowded.

But sellers should introduce new products at least every fortnight, they said, keep track of sales to replenish sold- out items and take back unmarketable ones to keep customers happy, they said.

Vo Hoang Anh, marketing director of Sai Gon Co.op – which owns Co.opMart – said in recent years sales of ready-to-wear fashion products have increased sharply, and the number of suppliers of these items increased by 20 per cent a year on average.

Consumers prefer to shop for garments at supermarkets because they are of clear origin, priced reasonably and come in diverse designs.

But "garment products at supermarkets currently focus on middle-income buyers," Anh said.

Doan Thi Minh Hai, a teacher at a dance school in District 3, said she frequently goes shopping for both work clothes and home wear, and supermarkets offer convenience and choice of design and price.

The Co.opMart outlet on Nguyen Dinh Chieu Street in HCM City has a large area for apparel with an eye-catching display. More than 90 per cent of the products are made by private firms and small production facilities.

At many supermarkets like Maximark, Aeon Citimart, and Big C, the area for displaying garments is large and offers a range of clothes for people of many ages at VND100,000-300,000.

VN optimistic about economic growth, even if oil prices fall

The Vietnamese economy is projected to continue recovery in the four remaining months of the year, bolstered by Government efforts to maintain macro-economic stability against fluctuations in the world markets.

According to the Ministry of Planning and Investment, the yuan depreciation and the plunging oil prices would not have an impact on the country's growth which was now on track to finish at 6.4 per cent this year, 0.2 percentage point higher than the Government's target.

The plunging oil prices would even help boost growth if Viet Nam knew how to grasp the opportunities, the ministry said, and added that the country had solutions against the low oil prices to ensure budget collection.

In addition, measures to support exports, including devaluation of the Vietnamese dong, also helped shelter Viet Nam's export from the impact of China's move of devaluating the yuan.

The economic growth would also receive a push from improved domestic purchasing power and rising demand of export products.

With the macro-economic stability maintained against the fluctuations in the world and regional markets, indicators of growth, inflation, budget collection, budget deficit, trade and production were under way to fulfil the goals.

According to the ministry, out of 14 socio-economic indicators, seven would exceed goals, six meet goals and only one was forecast to be missed. This was related to the percentage of forest cover.

However, the ministry noted that the agricultural, forestry and fishery sectors were anticipated to encounter difficulties due to the downward trend in prices in the world market, worsened by low competitiveness of the sectors' products. Businesses, especially small and medium enterprises, would continue to face difficulties due to their low competitiveness, the ministry added.

Earlier this month, Minister of Planning and Investment Bui Quang Vinh said that Viet Nam's gross domestic product (GDP) would reach 6.4 per this year.

Reporting a similar forecast, the National Financial Supervisory Commission recently said that the economic growth of Viet Nam would fulfil or even exceed the goal set at 6.2 per cent this year.

The Government expects to set higher goals of economic indicators for next year as the country is on track to fulfil this year's targets. Still, macro-economic stability remains top priority.

State Bank to maintain exchange rate stability

Possible changes in the interest rate in the United States will not impact Viet Nam's goal to maintain exchange rate stability over the next few months, the central bank affirmed.

The State Bank of Viet Nam (SBV) said in a news release on September 20 that the possibility of the US Federal Reserve (Fed) raising rates had already been reflected in moves of interest and exchange rates in the world's financial market since late 2014.

The central bank added that this probability had also been taken into account in domestic scenarios for inter-bank exchange rates and trading bands of the rates, which had been adjusted over the last few months.

"The room for the dong exchange rate [fluctuations] has been adequate for flexible adaptation to disadvantages that may happen in the global market, not only during the rest of 2015 but also during the first few months of 2016," the central bank said.

Last month, the SBV devalued the dong by one per cent, and widened the trading band for the reference rate to three per cent, in a bid to minimise the negative impact of the sharp Chinese yuan depreciation.

Market speculations about a Fed rate hike have fuelled worries about even more pressure on the domestic currency and economy, especially when Viet Nam's current account balance is sliding into a deficit.

However, the dollar-dong exchange rates have eased last Friday following a decision by the Fed to keep its interest rates steady.

While the Fed said it will continue to monitor global market developments for the rate adjustment in the future, the SBV said it is willing to sell foreign currencies to intervene in the market if necessary, for a stable foreign exchange market, and exchange rates that operate in the permitted band.

Currently, the average inter-bank exchange rate is VND21,890 per dollar.

Timber exports likely to grow 10%

Viet Nam expects a year-on-year growth of 10 per cent in export of timber and timber products this year, said a Viet Nam Wood and Forestry Product Association official.

Nguyen Ton Quyen, deputy chairman and general secretary of the association, said that the last quarter was working season of the wood industry and by now, wood processing enterprises had numerous export contracts so the country could reach its wooden exporttarget of $7 billion.

This was a good news for the wood industry after a few years of experiencing difficulties in production and business, he said. The industry had gained 15-20 per cent each year before 2010 but that came down to 10 per cent a year since 2010 until now.

However, Quyen said that for a long time, the industry continued facing difficulties from changes in the exchange rate between the Vietnamese dong and the US dollar and barriers from free trade agreements, the haiquanonline reported.

It was estimated that based on the exchange rate of VND20,000 per 1 US dollar, the industry would require $1 billion for imports by this year-end.

But the State Bank expanded the trading band for the inter-bank exchange rate from plus or minus 2 per cent to 3 per cent last month.

With the new band, the dollar was higher than VND20,000 and even reached VND22,500 per US dollar in some moments so that the local wood enterprises would now need to pay more, he said.

The local wooden firms also face certain problems with free trade agreements, including the certificate of origin of wooden material. For local firms, especially small and medium enterprises, that is a big problem as they have not paid much attention to the origin of the wooden material, Quyen said.

According to the General Department of Customs, Viet Nam gained a year-on-year increase of 9.4 per cent in total export value of wood and wooden products to $4.35 billion for the first eight months of this year. The four largest export markets of Vietnamese wooden products were the US, Japan, the EU and China.

During the first eight months of this year, the US was the largest export market of Vietnamese wood and wooden products, accounting for 39 per cent of the total value and reaching a year-on-year surge in export value of 19.3 per cent to $1.69 billion.

Following the US was Japan, accounting for 1 per cent of the total export value and gaining a year-on-year increase of 3.2 per cent in export value to $654 million.

In the first eight months, the industry achieved a trade surplus of $165 billion, said the General Department of Customs.

MBB offloads shares, boosts capital

The Military Commercial Joint Stock Bank (MBB) offloaded its entire 390.6 million shares in a public offering in September.

The bank announced on Sunday that the sale went better than expected.

The shares were set at a starting price of VND10,000 (44 US cents) each from September 1 to September 19, and were purchased at prices from VND10,500 (47 cents) per share to VND11,665 (52 cents).

MBB received VND4.28 trillion ($190.41 million) in total, pushing its capital up to VND16 trillion ($711.84 million).

According to local media, MBB is now the sixth largest bank by assets in Viet Nam.

Aside from four existing shareholders who bought shares, State Capital Investment Corporation (SCIC), a new investor, purchased 160 million shares or 10 per cent of the bank. SCIC become the second largest shareholder after Viettel, which bought an additional 60.8 million shares, bringing its total holdings in MBB to 240 million shares or a 15 per cent stake.

Viettel Import Export Limited Company (Viettelimex) bought another 26.68 million shares, bringing its total to 74.2 million 4.64 per cent of MBB. Saigon Newport Corporation bought another 71.4 million shares, bringing its total to 122.4 million or 7.65 per cent.

Existing shareholders in Maritime Bank and Vietcombank did not participate in the offering, which caused Maritime Bank's holdings in MBB to fall from 12.06 per cent to 8.84 per cent and Vietcombank's holdings to fall 9.6 per cent to 7.16 per cent.

MBB's shares ended at VND15,300 ($0.68) on the HCM Stock Exchange yesterday.

Smartphone maker looks to foreign markets for growth

Tech firm Bkav is seeking new markets for its smartphone,Bphone, after joining meetings with foreign distributors at a recent global summit on mobile telecommunications in Hong Kong, according to Vietnamese media.

Bkav representatives met with many network operators that also act as smartphone distributors from Thailand, India, Indonesia, and a European nation on the sidelines of the Qualcomm 3G/LTE Summit, according to news website VnReview.

The firm engaged in talks with True Move, which has a 24.6% market share, or 26 million subscribers, in Thailand and Telenor, a provider of mobile services in Europe which is investing in mobile networks in Asia, VnReview reported.

But Bkav, which is based in Hanoi, refused to talk about what was discussed during these meetings, the news website said.

According to the agenda of the three-day summit, Bkav worked with senior leaders of American chipmaker Qualcomm, which is supplying microchips to the Vietnamese company, on the next generation of the Bphone, which is expected to be released in the first quarter of next year.

Andy Chu, director for Bkav Singapore and the Asian region, confirmed the information but declined to go into further detail, according to VnReview.

The tech firm unveiled the first generation of its flagship Bphone at a 2,000-attendee event in Hanoi on May 26.

The Bphone is 7.5mm wide with a Sharp 5.0 inch full HD screen, protected with Corning’s Gorilla Glass, which Samsung and Apple also use for their devices.

The full aluminum body handset is equipped with Toshiba’s 3GB RAM and the Qualcomm CPU Snapdragon 801 quad-core 2.5GHz.  

The Bphone’s 3,000mAh battery is facilitated with a fast-charging technology called Quick Charge 2.0.

It has a 13MP primary camera and a 5MP secondary one, both covered with sapphire glass.

At the summit, Hideki Ogura, general manager of Platform Enabling Group under Toshiba Electronics Asia, used the Bphone to demonstrate the TransferJet connection technology, according to news website VnExpress.

TransferJet is a close-range wireless technology that helps users transfer data like music, high definition videos between mobile devices at very fast speed.

According to Toshiba, this technology can attain a speed of up to 375 Mbps in data transmission, enough to transfer a 20-second HD video file within one second.

Trade liberalisation for environmental goods necessary

Trade liberalisation for environmental goods and services has become the key to Vietnam's bilateral and multilateral negotiations, and international cooperation.

Pham Nguyen Minh, director of the Institute of Trade Research, said the World Trade Organisation (WTO), the Organisation for Economic Co-operation and Development (OECD), and the Asia-Pacific Economic Cooperation (APEC) have been the leading international organisations to promote trade liberalisation of goods and services.

In 2014, the world trade value for environmental goods and services reached US$4 trillion, demonstrating a high growth rate. The value is expected to reach US$10 trillion by 2020.

The US took the lead in investment in goods and services, reporting an export turnover of US$106 billion in 2013 and an annual growth rate of more than 8%. The European Union, China, and India followed.

Minh told the Trade Liberalisation for Environment Goods and Services workshop, held recently in Hanoi, that the Vietnamese Government had passed several policies to enhance the development of environmental goods and services.

In 2014, the market value for Vietnamese goods and services was US$20 billion, accounting for 0.5% of the world total. Vietnam took the 33rd position in the top 50 environmental goods and services markets in the world.

"Development is neither equal to the country's potential, nor local demand," he said, adding that Vietnam only focused on importing machines and technology from foreign countries.

Imports accounted for over 80% of the market value. Production of goods and services in water and waste-treatment had yet to be developed.

There were only 15 businesses operating in the environmental industry in Vietnam.

He added that other countries had found it similarly difficult to promote trade liberalisation of environment goods and services as there was no global standard definition of goods and services.

Tran Huy Hoan, a specialist from the European Trade Policy and Investment Support Project (EU-MUTRAP), agreed that Vietnam would have both opportunities and challenges in obtaining trade liberalisation in goods and services.

Hoan said that liberalisation of goods and services could help the country expand its market, promote investment, reduce environmental protection costs, and create more jobs.

Vietnam, however, did not have a list of environmental goods and services. Big initial investments and high technology requirements would increase competitiveness in the industry and make it difficult for domestic businesses to grow.

Chu Van Giap from the Department of Science and Technology said that the environmental industry in Vietnam had only taken baby steps, with a modest number of businesses and limited capacity.

The lack of policies and mechanisms for the industry's development had been one of the biggest barriers, Giap noted.

David Luff, a specialist from EU-MUTRAP, recently established a list of products which Vietnam could negotiate for reduced taxes or push its comparative advantage in the future.

Experts strategise on property sector

The Australian Chamber of Commerce in Vietnam (AusCham) held its third annual symposium in Ho Chi Minh City last week to discuss investment strategies for the Vietnamese real estate market.

Themed “Away to the Races”, the conference attracted the participation of government officials, business leaders, investors, and experts. It aims to provide insight into trends in Vietnam’s real estate market and create an open dialogue for participants to discuss challenges and solutions for developing property in the country.

Former Deputy Minister of Construction Nguyen Tran Nam said that the real estate market, especially the high-end segment, had seen a revival and is likely to develop strongly. In the first eight months of 2015, successful transactions in Hanoi and Ho Chi Minh City reached 13,000 and 12,000 respectively, almost doubling the figures for the same period last year. “Despite the increasing number of transactions in the property market, the price remains stable. Vietnam’s real estate inventory was estimated at VND60 trillion ($2.64 billion) by the end of August this year, a fall of 47 per cent compared to the fourth quarter of 2013. Money is flowing into the property market, especially through foreign direct investment capital and remittances,” he added.

With this positive market outlook, experts have pointed out new investment opportunities from stalled property projects.

“Of the 689 delayed projects in the city, 85 projects are expected to be revoked. Also, the municipal people’s council has directed the people’s committee to revoke other 300 projects in the recent meeting. These delayed projects will become a new source for merger and acquisition deals,” Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association, shared. “Novaland, for example, has acquired 50 projects and resumed 20 to date. The firm intends to launch seven projects from now till the end of 2015.”

In this sentiment, Don Lam, VinaCapital’s co-founder and CEO said, “The market is witnessing the rise of local players like Novaland and Vingroup, so we are stepping back and we will play our best as a foreign investor. For VinaCapital, we are also looking for clean and clear projects to develop.”

According to Nguyen Huu Thuy, general director of Vietnam Asset Management Company (VAMC), the company has purchased another VND100 trillion ($4.4 billion) worth of bad debts this year, up $4.4 billion from last year. 68 per cent of assets managed by VAMC are property projects, so the company plans to welcome new investors for these unfinished projects in the future.

Thuy added that the stalled projects were expected to be resumed to create money flow, employment, and income to solve the root of bad debts. Therefore, VAMC is determined to train staff and collaborate with consultants to hand over projects to new investors.

“VAMC is working with relevant ministries and departments to complete profiles and legal documents. We are committed to providing good after-sales service by dealing with arising problems in practice so conditions are favorable for new investors to continue developing projects. VAMC is also co-operating with the Japan International Co-operation Agency (JICA) to establish a set of rules in accordance with international standards, so that foreign investors can get better access to projects,” he noted.

Smartphone turnover beats feature phone sales for first time in Vietnam

Vietnamese consumers bought more smartphones than feature phones in the second quarter of 2015, market research firm IDC said.

Smartphone sales thus beat feature phone turnover for the first time in Vietnam, with a market share of 51 percent, compared to 44.5 percent in the previous quarter, The Saigon Times Online said, citing data from an IDC report.

Feature phones are handsets that incorporate such features as the ability to access the Internet and store and play music, but lack the advanced functionality of a smartphone.

Vietnam imported 6.5 million mobile phones in the second quarter, 500,000 devices fewer than the preceding three months, according to IDC.

These included 3.3 million smartphones, worth US$607 million.

Samsung held the biggest market share, 30 percent, followed by Microsoft (13 percent) and Asus (14 percent).

In terms of value, Samsung also took the lead with 36 percent, with Apple (13 percent) and Asus (11 percent) coming second and third.

Smartphone price in the second quarter averaged $183 a handset, down 26 percent quarter-on-quarter, which could explain the rise of sales as the devices have become more affordable.

Vietnam also imported 291,000 tablets worth $53 million in the second quarter, which posted almost no growth compared to the previous quarter, according to IDC.

The average price of tablets also dropped 31 percent from the first quarter to $183 a device.

HanesBrands Vietnam to raise investment capital

HanesBrands, the US’ manufacturer and marketer of everyday apparel essentials, aims to raise its total investment in Vietnam to nearly $55 million by the end of 2015, increasing its 2014 figure by $11 million.

This marks Vietnam as a critical investment destination on the group’s worldwide manufacturing map. Last year, the company moved its men’s boxers production from Costa Rica to Vietnam in order to cut costs. Founded in 2007, HanesBrands Vietnam produces and exports apparel to critical markets, including the US, Canada, Japan, and China. The company has three plants in Khoai Chau and Kim Dong districts in the northern province of Hung Yen and Phu Bai town in the central province of Thua Thien-Hue. HanesBrands Vietnam’s annual capacity reached 475 million units, accounting for 20 per cent of the group’s total production.

HanesBrands Vietnam is the largest consumer of US yarn in Southeast Asia, with over $1 billion of US yarn consumed via its sewing plants. The company is now generating jobs for over 11,000 local employees, and has become one of the largest US employers in Vietnam. HanesBrands Vietnam has seen continuous growth in exports during its eight years of operation here. In 2014, with the inauguration of its third plant in Kim Dong, the company’s total exports surged to $334 million, and the figure is expected to reach $355 million in 2015.

“We are going to introduce more complex garments and innovative technologies in Vietnam in the upcoming years, especially as Vietnam is standing on the verge of the Trans-Pacific Partnership,” said Ajay Godbole, director of Operations for Asia.

Lotte makes bid for vital rail route

Lotte Engineering & Construction, part of South Korean conglomerate Lotte, has submitted a document to the Ministry of Transport expressing its interest in continuing the project to upgrade the Hanoi-Lao Cai railroad.

The company proposed investing in the second phase of the project under the build-lease-transfer (BLT) format. If approved, Lotte is expected to submit the detailed investment plan within four months.

The Hanoi-Lao Cai route is 300 kilometres long and is the second-most important railroad in Vietnam, following the north-south railroad. It accounts for 30 per cent of national cargo transport by rail and 16 per cent of its passenger transport.

The aim of the project’s second phase is to raise the capacity of the route to 5 million passengers and 7.5 million tonnes of cargo per year, with 90 minutes shaved off the current travel time of seven hours.

Lotte is one of the Engineering & Construction contractors to take part in the first phase of the project, which cost $166 million, and was completed in late April this year. In South Korea, the company was involved in several rail projects such as the Gyeongbu high speed railway, the Cheongnyangni-Deokso double-decker train railroad, and the railroad linking the Busan centre to the city’s port.

The second phase of the Hanoi-Lao Cai railroad is expected to be completed within three years. Afterwards, Lotte will lease the infrastructure to Vietnam Railways. The leasing price and time period will be outlined in the investment plan.

The $166 million first phase was carried out with the official development assistance (ODA) capital from the Asian Development Bank (ADB), borrowed capital from the French Development Agency (AFD) and the French public treasury (DGTresor), and reciprocal capital from the Vietnamese government.

The Ministry of Transport is working with ADB to arrange capital for the second phase, which is expected to cost $113 million, of which Vietnam expects to borrow $48 million from the bank, $30 million from AFD, and $26 million from DGTresor.

Following the completion of the section linking Haiphong station to Lach Huyen port, the railway linking Kunming in China, Lao Cai, Yen Vien station in Hanoi, and finally Haiphong port will be complete. This development will directly help raise the competitiveness of Vietnamese goods – especially apatite mined in the northern province of Lao Cai – as the cost of transport will be much lower and this will be the shortest route linking provinces in the southwest of China to sea ports.

“The BLT format that Lotte has proposed is feasible and has been used in many other countries,” said Nguyen Ngoc Dong, Deputy Minister of Transport.

The Hanoi-Lao Cai route is part of the Kunming-Haiphong traffic corridor. It spans 285km in the northwest direction, along the north bank of the Red River, to Lao Cai at the border between Vietnam and China. The route passes through Hanoi, and Vinh Phuc, Phu Tho, Yen Bai, and Lao Cai provinces.

Double-digit growth in 8M trade

Total trade stood at over $216.76 billion in the first eight months of the year, the General Department of Vietnam Customs has announced, an increase of 12.9 per cent against the same period last year. Exports were $106.5 billion, an increase of 9.2 per cent, and imports $110.26 billion, an increase of 16.8 per cent. Vietnam therefore recorded a trade deficit of $3.76 billion in the first eight months, after recording a surplus in 2014.

In August crude oil exports were 823,000 tons, an increase of 2.8 per cent against July. Crude prices, though, fell $57 per ton in the month, putting revenue at $295 million, or 11.3 per cent lower than in July.

In the first eight months crude exports totaled 6.3 million tons, an increase of 0.6 per cent year-on-year, earning $2.74 billion, a substantial 48.6 per cent ($2.6 billion) decline. Most exports went to Singapore, with 1.14 million tons and almost three times higher than in the same period last year, while Japan received 1.09 million tons, a 28.3 per cent decline, China 1.05 million tons, down 6.4 per cent, and Malaysia 1.04 million tons, an increase of 49.1 per cent year-on-year.

Coal exports took a tumble in the first eight months, standing at 1.3 million tons, a 75.6 per cent decline against the same period last year, with a value of $136 million, 64.9 per cent lower year-on-year.

Rice exports also experienced a decline in the period, with 4 million tons exported, or 9.7 per cent lower year-on-year, for revenue of $1.74 billion, a fall of 14.3 per cent.

Coffee exports were 879,000 tons worth $1.81 billion in the first eight months, a 32.3 per cent fall in quantity and a 32.6 per cent fall in value.

The foreign direct investment (FDI) sector continued to contribute significantly to Vietnam’s trade, to the tune of $137.25 billion, an increase of 21.9 per cent against the same period last year. Exports were $72.35 billion, an increase of 21.2 per cent, and imports $64.9 billion, an increase of 22.6 per cent.

Trade by domestic enterprises totaled $79.51 billion in the first eight months, with export turnover at $34.14 billion, a decline of 9.7 per cent.

1,150 units launched in Nha Trang during first half

Three new projects entered Nha Trang’s real estate market in the first half of 2015, according to the latest report from Savills on the coastal city, adding more than 1,150 units.

There are now approximately 3,550 units from eleven projects. Six active projects supplied 1,649 units with 60 per cent sold and the remaining stock was fully sold.

Sixty per cent of the stock was developed as studios or one-bedroom units, ranging in size from 32 to 50 sq m. Two-bedroom units account for approximately 36 per cent of the total stock.

Projects in Loc Tho saw the best performance, with an average selling price of VND48 million per sq m ($2,136), with 65 per cent of projects selling out. All projects are located on Tran Phu Street and have professional management and good facilities, with most buyers coming from Ho Chi Minh City, Hanoi or overseas.

Regarding market demand, over the last five years Khanh Hoa province’s tourism market has performed well, according to the report. Annual revenue grew by 20 per cent and the annual growth rate of arrivals was 18 per cent. The amended Law on Housing allows foreigners to have a 50-year leasehold in residential projects.

Nine future apartment projects were in the pipeline in the first half, which will supply approximately 7,240 units. “One project is currently under construction while the others are being planned or on hold,” the report wrote.

The Park set to launch

On September 27 Vingroup will launch two apartment buildings, Park 1 and Park 6, at The Park complex in Vinhomes Central Park in Binh Thanh district, Ho Chi Minh City.

Vinhomes Central Park includes four complexes - The Central, The Landmark, The Park, and The Villas. The Central and The Landmark have already been successfully launched on the market.

The Park consists of seven apartment buildings considered to have the best and greenest location at Vinhomes Central Park. Facilities at The Park are of five-star quality, with an outdoor gym area, a children’s playground, a BBQ area, a reception area and a guest lounge with staff available 24/7, as well as an automatic camera supervision system and an automatic fire protection system.

The Park 6 apartment building is equipped with a smart-home package, including automatic control systems for curtains, sound and light. It also inherits the infrastructure of Vinhomes Central Park, with the Vinmec international hospital, Vinschool, and Vincom shopping complex, combined with entertainment such as an IMAX high-end theater system and an ice skating rink.

Earlier this month Vingroup introduced model apartments at The Park to visitors, of one to four bedrooms.

Vinhomes Central Park is invested by Vingroup and has a total area of 43.91 hectares, designed as a “mini green city” in Ho Chi Minh City. Expected to be completed in 2016, it will be the “green lung” of the downtown area.

Over VND1.2 trillion invested on green apartment project

The Phuc Khang Corporation and the Green Consult Asia Group, under the US Green Building council has collaborated on a green apartment project - the Diamond Lotus, which meets the Leadership in Energy and Environmental Design (LEED) standard.

The Diamond Lotus comprises of three buildings, in which apartments are constructed on areas of between 58 to 91 square metres. The project is guaranteed by the Asia Commercial Bank (ACB).

According to Melissa Merry Weather, Director of the Green Consult Asia, the LEED certificate is recognised globally for green construction projects via the design, construction and operation, aiming to improve effectiveness, save energy (from 20% to 30%) and water use (from 35% to 50%), reduce CO2 emission, use non-toxic materials, as well as create a friendly and healthy living environment for residents.

The standard has been applied in the US in over 60,000 projects and 134 other countries worldwide, while over 2,000 projects in Asia have met the requirements.

In Vietnam, the Diamond Lotus is the first apartment project following the LEED standard. Though the construction cost has increased by 10%, the buildings are able to save energy, water and are environmentally friendly, thus the service costs incurred when leasing the buildings will be small, said Weather.

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