Hanoi highest tower won’t use State budget

Construction of the 79-storey Oil and Gas Tower, which will be Hanoi’s tallest building, will not use any capital from the State budget, affirmed its investor, the PetroVietnam Construction Joint Stock Company (PVX).

PVX General Director Vu Duc Thuan made the statement at a press briefing in Hanoi on March 27, denying rumours that the project will be partly funded by capital from the State budget and the National Oil and Gas Group (PetroVietnam), which holds a 40 percent stake in PVX.

According to Thuan, the building will have only 79 storeys instead of the originally-planned 102 storeys and as a result, the estimated cost will drop from over US$1 billion to US$600 million.

Thuan said that when the project’s feasibility study is approved, PVX will set up the Oil and Gas Tower Joint Stock Company to arrange capital and carry out the project. Capital for the project is expected to be sourced from PVX and domestic and foreign partners.

PVX will joint the Hansin firm from the Republic of Korea and Samsung C&T, both of which have experience in constructing buildings over 70 storeys.

The project’s final design will be announced on March 30 after an international competition. The Oil and Gas Tower will be built on 6.5 ha in Me Tri commune, Tu Liem district, Hanoi. It will be built using modern and environmentally- friendly technology and be able to withstand earthquakes up to 6 on the Richter scale.

VN needs Dutch port, coastal experience

Vietnam needs cooperation and experience from marine powers in the world, especially the Netherlands and the seaport city of Rotterdam, said Deputy Prime Minister Hoang Trung Hai.

Deputy PM Hai made the statement at a seminar in Hanoi on Mar. 29 on the Rotterdam seaport model – a potential partnership with Vietnam.

The event, which was held by the Ministry of Transport and Communications, is under the framework of the visit to Vietnam by Dutch Crown Prince Willem-Alexander and Princess Maxima.

Deputy PM Hai stressed that the marine economy plays a key role in Vietnam’s overall economy. Seaports and marine transport were an important part of the country’s marine economy development strategy.

He said he hoped that the Netherlands would share its know-how and experience in seaport management with Vietnam, to help the latter attain the goal of modernizing its seaport system and rapidly integrating into the region and the world.

He expressed his belief that the two sides would find common ground to create suitable cooperation models between Rotterdam in the Netherlands and major ports in Vietnam.

At the seminar, Le Tuan Anh, representative of Vietnam Maritime Administration, emphasized the geographical advantages and capacity of developing seaports in Vietnam, as well as opportunities to invest in the country’s seaports.

The leading seaport experts from the Netherlands shared their experience in investing and developing the port of Rotterdam, as well as the operation model of the port.

The same day, experts from the Netherlands and Vietnam gathered at another seminar in Hanoi, discussing cooperation models for the two sides in coastal management and design and inspection of sea dykes in order to mitigate the risks of natural disasters and climate change.

Head of the Dyke Department Tran Quang Hoai said that Vietnam was among one of five countries facing the most serious impacts from climate change, including rising sea levels and challenges in coastal protection.

Also addressing the event, Deputy Minister of Agriculture and Rural Development Dao Xuan Hoc asked the Netherlands to help Vietnam complete the pre-feasibility project to implement coastal management and sea dyke inspection effectively.

Joop Atsma, Dutch State Secretary in charge of Infrastructure and Environment, said Vietnam and the Netherlands share many similarities, including a long coastline and millions of people living along the coast, who are vulnerable to impacts of natural disasters. With its experience, the Netherlands was ready to cooperate with Vietnam and expected that the two sides would have optimal measures to effectively manage the coastal region and sea dykes of Vietnam.

Vietnamese insurer announces new name

Vietnamese insurer Bao Tin Assurance Corporation today announced its new name at a ceremony at Sheraton Hotel in Ho Chi Minh City.

It has been accordingly renamed Phu Hung Assurance Corporation under a decision recently issued by the Ministry of Finance.

Phu Hung is a non-life insurance firm that provides a wide range of products and solutions for personal and commercial risks including personal accident, health, property damage, marine insurance, machinery, engineering, casualty and others.

The firm last year raised its charter capital from VND80 billion (US$3.9 million) to VND300 billion ($14.5 million) via contributions by local and international reputable shareholders including Taiwanese property developer Phu My Hung.

It also signed memorandums of understanding with strategic partners like Vietnamese bank Kien Long, local developer Thu Duc Housing Development Corporation, Vietnam Commodity Exchange, and US-based multi-sector group SME Holdings.

Cbank tightens dollar lending rules, more expected

Vietnam's central bank has asked lenders to restrict dollars loans to importers and certain exporters, in its latest step to stabilize the economy and curb inflation.

The State Bank of Vietnam has asked banks to ensure that only short-term funding is extended to exporters, while importers can avail of all types of loans, it said in a circular released on Friday. The rules will be effective from May 9.

Economists say that the central bank, after an initial bout of rate increases, is now focusing on the currency market, noting further monetary tightening may hurt liquidity of banks.

While the central bank has already introduced measures restricting dollar loans, the new steps show the central bank is determined to stabilize the foreign exchange market, said Tran Hai Yen, economist at Hanoi-based Bao Viet Securities Co.

"The forex market had been let loose in the past few years and the central bank is trying to regain control," she said.

The State Bank of Vietnam has, over the past two months, cut its target for credit growth to below 20 percent from an initial 23 percent and money supply growth to 15-16 percent from 21-24 percent. It has also clamped down on unofficial dollar trading while the government aims to cut spending to slow inflation.

Overt dollar trading in gold shops in Hanoi, which have operated as unofficial foreign exchange floors, has been frozen. The dong rose to 21,120/21,170 a dollar at a Hanoi major gold shop at 0217 GMT on Monday from 21,200/21,300 a week earlier.

Several banks have had to sell dollars for dong in the past few weeks to ease a liquidity crunch after the central bank raised dong refinance and discount rates, said a currency trader in a foreign bank.

The central bank has also cut dong cash injection via open market operations, he added.

"Dollar trading now depends on dong liquidity," he said.

The central bank may submit an "anti-dollarization" plan, which could include changing the dollar reserve requirements and monitoring gold trading, to the National Financial and Monetary Policies Advisory Council and the government next month, a government adviser has said.

Vietnam's total payment balance is expected to have a surplus of $2 billion this year versus a surplus of $3.07 billion last year and a deficit of $8.8 billion in 2009, State

Bank of Vietnam Governor Nguyen Van Giau told the parliament on Saturday.

Thai company to invest in HCMC’s monorail project

Italia-Thailand Development Public Co, Ltd (ITD) and Ho Chi Minh City Urban Railway Management Board have signed a memorandum of understanding on investment cooperation to build the monorail No.2 and 3 and metro route No.4. 

ITD has also proposed to register for Build-Operate-Transfer investment feasibility study on the monorail line No. 2 and No. 3, while it is considering an appropriate investment model for  metro line No.4 , said Nguyen Luong, head of the board.

The monorail No 2 with nearly 14 kilometers in length starting from East-West Highway, running along Nguyen Van Linh Street to National Road No 50, has a total investment of about $350 million.

The $200 million monorail No 3 with about 8.5 kilometers in length will run along Quang Trung Street from the roundabout of Go Vap Intersection to Quang Trung Software Park and turn into the station located in Tan Thoi Hiep Ward in District 12.

The metro line No 4 with 24 kilometers (19 kilometers of underground and five kilometers of overpass), 20 stations, a 30 hectare depot in Thanh Xuan Ward, and another 25 hectare depot in Nha Be District has an estimated investment of $2.5 billion.

Once finished, the projects will link the south to the west of the city, develop the transport system in the west of the city, and connect with other provinces in the Mekong Delta.

Most Savills profits comes from Asia-Pacific

UK-based realty firm Savills Plc earned over 60 percent of its 2010 pretax profits, 29.7 million pounds (US$46.1 million), in Asia-Pacific region, up 70 percent year on year, according to Savills’ latest report.

The region also contributes to 41 percent of Savills’ total revenue.

With its 2010 revenue and pretax profit up 21 percent and 173 percent year on year to 677 million pounds and to 36.8 million pounds globally, Savills has announced new distribution policy that final ordinary and supplemental interim dividends totaling 10 pounds per share, up from 6 pounds in 2009, making a 44 percent increase to 13 pounds for the year.

"Savills’ strong performance last year was driven by a resurgence of investment activity in prime global markets, most notably in London and a number of Asian capitals. It was also encouraging to see conditions improve in the US and the key French and German markets, although the trend was not consistent across all of Continental Europe,” said Jeremy Helsby, chief executive of Savills Plc.

“In the near term, it is unclear how markets will react to the recent catastrophic events in Japan, particularly at a time of unprecedented global economic and political change. For the markets of Mainland China, Hong Kong and Singapore these events come on top of government measures of the last twelve months to address property speculation”, he said.

“The longer term potential of our Asian business remains compelling, but at this stage, we continue to expect a reduced volume of transactions in the region in 2011”, he added.

Established in the UK in 1855, the London Stock Exchange-listed company has an international network of more than 200 offices and associates throughout America, Europe, Asia Pacific, Africa and the Middle East.

Vietnam trade deficit eases in first quarter

Vietnam's trade deficit eased slightly in the first three months of 2011 in a boost for the government as it battles to stabilize its troubled economy.

The deficit is forecast at $3.03 billion in the January-March period, against $3.43 billion for the same quarter last year, the General Statistics Office (GSO) said.

Compared with the first quarter of 2010 exports rose 33.7 percent to $19.25 billion, while imports gained 23.8 percent to $22.3 billion, the GSO said.

Last year's trade deficit was estimated at $12.4 billion and the government has set a target that this year's figure should not exceed 18 percent of export revenues.

"Things are on track and I think that we will be able to meet this target," Deputy Minister of Industry and Trade Nguyen Thanh Bien told Dow Jones Newswires.

The data come after Hanoi in February devalued its dong currency 9.3 percent in a bid to narrow the trade gap, while it has also increased interest rates to tame inflation, which is estimated to a two-year high 13.9 percent this month.

Hanoi has described bringing prices under control as its number one priority.

However, the fall in the trade deficit is "very small" and the impact of the devaluation -- the largest in years -- is not expected to be felt until later months, said Deepak Mishra, lead economist at the World Bank in Hanoi.

The devaluation was the first strong action by the government after months of growing investor concern over rising inflation, a struggling currency, and a trade deficit that accompanied the country's high growth rate.

International capital markets have welcomed Vietnam's moves as "a good start" while the cost of borrowing has dropped in recent weeks, bringing it back in line with the emerging-market average, Mishra said.

But economists say much will depend on how the government implements its stabilization package, and whether those efforts are sustained.

Annual growth reached 6.8 percent in 2010 and the ruling Politburo is now downplaying the need to top that figure this year. Analysts say the government is looking to balance its traditional quest for growth with stabilization.

ExxonMobil to start exploration

American oil and gas giant ExxoMobil will start its first exploratory drilling off the central coast of Vietnam late next month.

The decision was agreed upon at a city yesterday between leaders of the People's Committee of Da Nang City and representatives from ExxonMobil Exploration and Production Vietnam Ltd.

The drilling will be conducted at block 119 on the continental shell offshore from Quang Ngai Province and Da Nang City.Phung Tan Viet, vice chairman of the Da Nang People's Committee asked the company to strictly guarantee technical requirements to avoid environmental pollution. The two sides also discussed plans to ensure safety during oil-rigs construction.

Viet also ordered the city's Department of Agriculture and Rural Development to inform fishermen not to use the exploration area during the 40 days of drilling.

According to reports from state-owned Vietnam Oil and Gas Group PetroVietnam, Vietnam's crude oil reserve in 2010 was estimated at 4.4 billion barrels. The crude oil and gas exploration output in 2010 reached 15.1 million metric tonnes and 9.4 billion metric tonnes, respectively.

VN, Japan cooperate in fertiliser supply

PetroVietnam Fertiliser and Chemicals JSC (PVFCCo) and Japan–Vietnam Fertiliser Company (JVF), a member company of the Sojitz Group of Japan , on March 29 inked a memorandum of understanding (MoU) on cooperation in fertiliser products supply.

According to the MoU, JVF will supply PVFCCo with 30,000–40,000 tonnes of high quality NPK fertiliser.

Meanwhile, PVFCCo will provide Sojitz with 200,000–300,000 tonnes of urea per year for export to Thailand , the Philippines and other countries, after the product met consumption demand in the domestic market.

On the occasion, the two parties also planned to sign contracts for technical assistance service in the future.

JVF will help PVFCCo in operation and maintenance work for the NPK factory, which was invested by PVFCCo.

Once the contract comes into force, PVFCCo will have the chance to expand its products list along with its popular product of urea fertiliser, as well as to open new markets for products of its NPK plant.

CSR is top of the pops

Vietnamese and Dutch business leaders have shared experiences and challenges regarding corporate social responsibility.

The meeting lunch on “Maximising profits through responsible entrepreneurship”, co-organised by the Vietnam Chamber of Commerce and Industry and the Netherlands embassy, will convene business leaders, representing Vietnamese and Dutch companies at Unilever Vietnam office in Ho Chi Minh City on March 31, 2011.

The meeting is for the leaders to share their experience about the Vietnamese approach to corporate social responsibility (CSR) and the opportunities and challenges on responsible business.

The event will be organised at the occasion of the official visit of their Royal Highnesses, the Prince of Orange and Princess Máxima of the Netherlands to Vietnam, including over 80 companies in an economic mission led by the Netherlands Minister for Agriculture and Foreign Trade Henk Bleker. The vice president of the Vietnam Chamber of Commerce and Industry and co-chair of the Vietnam Business Council for Sustainable Development Doan Duy Khuong and Minister Bleker will co-host this meeting.

The meeting will focus on questions such as: how can entrepreneur ensure people, planet and profit at the heart of their business; how can the CSR help maximising profits, what are opportunities and challenges for using CSR in Vietnam situation. In response to these questions and challenges, the participants will raise their issues from practical experience of doing business in Vietnam showing that responsible entrepreneurship can help maximising profit while minimising environmental and social negative impact to the countries.

The Netherlands is currently the number-one EU investor in Vietnam, bringing many businesses to the country with high environmental and social standards. Dutch ambassador Joop Scheffers said: “They [Dutch businesses] are the true partners to Vietnam in its quest to become an industrialised country by 2020 through sustainable economic development.”

He added that “All over the world, Dutch businesses are looking for business opportunities while protecting the environment and promoting labour standards. And increasingly, they expect the same commitment from their suppliers.”

Viettel to open third data centre in Q2

The military-run telecom group Viettel said on March 28 that its third data centre will become operational in the southern province of Binh Duong in the second quarter of this year.

The $18 million Viettel Internet Data Centre (Viettel IDC), which has 10,000 sq.m of space capable of accommodating nearly 40,000 servers, is one of the largest data centres in Southeast Asia.

Covering 3,500 sq.m at the Song Than Industrial Park, the Tier-3 standard centre will provide collocation service for Government agencies, ministries and branches, banks, securities, insurance, communication and telecom companies, as well as small- and medium-sized enterprises.

Viettel currently has two smaller data centres in Hanoi and Ho Chi Minh City.

Nhon Hoi zone powers up

Central Binh Dinh People’s Committee recently has asked the prime minister to add a thermo-power production function to Nhon Hoi economic zone’s non-tariff area upon an investment proposal from Thailand-based STFE Company Limited.

Accordingly, STFE registered to build a thermal power plant with an annual capacity of 1,400 megawatts at an estimated investment of $972 million in the zone. Construction of the 120 hectare plan will kick-off in early 2012 and be completed in 2014.

Earlier, the province authorities signed with STFE a memorandum of understanding concerning the latter’s plan to build an oil refinery complex in Nhon Hoi. Once completed, the 150ha oil complex will report an annual production of six to eight million tonnes of petroleum products (three million tonnes in the first phase).

STFE Co., Ltd. provides multi-discipline engineering services in the field of electrical and mechanical as much as turnkey work for power generation projects. STFE’s expertise for power generation is focused on renewable energy and cogeneration plants.

Exports start 2011 off with a bang

Vietnam saw buoyant export figures in 2011’s first quarter.

According to latest General Statistics Office (GSO) figures, Vietnam’s key export items saw impressive growth compared to the corresponding period in 2010.

Textiles and garments raked in $2.79 billion in total export value in the first quarter, up 27.9 per cent on-year.

Not including crude oil exports, footwear came second with $1.29 billion, hiking 29.7 per cent on-year. It was closely followed by seafood with $1.14 billion, jumping 30 per cent on-year.

Rubber products reported most impressive growth in 2011’s first quarter with $774 million in total export value, leaping 134 per cent compared to the same period in 2010. Coffee also saw exceptional growth with $1.04 billion in the export value, soaring 115 per cent on-year.

Of export items hiking over 20 per cent in first quarter’s export value there were chemicals, machinery-equipment and spare parts, electrical wires and cables and cashews.

“First quarter’s export figures are upbeat amid uncertainties in the world market and high input material and fuel costs,” said deputy minister of Industry and Trade (MoIT) Nguyen Thanh Bien.

The enactment of export supportive policies in recent months helped businesses push up exports, according to MoIT executives. For example, businesses found it easier to source US dollars after the enactment of Resolution 11/NQ-CP dated February 24, 2011 concerning measures to curb inflation and stabilise the macro-economy.

However, a sharp rise in export values of most items mainly infused by higher world market export prices, except for coffee which saw 46.4 per cent hike in the export volume, following by rubber with 37.9 per cent and rice with 17 per cent up in the export volume.

To help businesses expand exports, the government urged local banks to prioritise lending production and export while restricting loans to non-productive areas, Bien said.

He said the central bank had instructed commercial banks to allocate capital to firms active in rice export to help them stockpile a certain amount of rice which would later be sold in the world market at favourable price terms.

Local firms also benefited from an improved access to capital sources for export promotion under the national trade promotion programme, according to MoIT’s Vietnam Trade Promotion Agency chairman Do Thang Hai.

“The MoIT founded an Appraisal Council to evaluate trade promotion programmes by businesses and is now more self-reliant in capital disbursement,” Hai said.

Pepper price jumps more than 50 per cent

The price of pepper exports in the first quarter jumped by 53.8 per cent over the same period last year to reach nearly US$4,800 per tonne, said head of the Information and Statistics Centre under the Ministry of Agriculture and Rural Development Nguyen Viet Chien.

Thanks to this sharp increase, pepper export value in the first quarter hit $85 million, matching last year's figure.

"The same value was hit despite the fact that the total export volume in Q1 was only 18,000 tonnes, 25 per cent less than last year," Chien said.

In March alone, pepper exports reached 8,000 tonnes, worth $38 million.

According to the Viet Nam Pepper Association, domestic pepper production had developed strongly, and signs of a high yield harvest were evident this year.

The association added that pepper crops in Tay Nguyen (Central Highlands) provinces had recovered following last year's drought, saying that the total pepper exported this year could increase by 5 per cent.

Around 60 per cent of the world's pepper is grown in Viet Nam, and the US, Germany and Holland are the three largest importers.

Last year, the country exported nearly 117,000 tonnes of pepper, worth $421 million. The numbers were up by 20.3 per cent in value but down by 13 per cent in volume compared with 2009.

Ha Noi GDP increases 9.2%

The capital city has recorded a 9.2% increase in Gross Domestic Product (GDP) in the first quarter compared to the same period last year, the municipal People's Committee reported today.

Despite many difficulties, the city's budget revenue increased by 4.2 per cent.

However, the Consumer Price Index (CPI) for March increased by 2.41 per cent over February, and by 6.18 per cent over last December, the highest levels for several years.

The city has taken measures to implement the Government's resolutions on inflation control, macro-economic stabilisation and social welfare promotion.

Ha Noi Party Committee Secretary Pham Quang Nghi said the city offered soft loans for rural and agricultural production and export activities.

He said the city had to apply measures to increase budget revenue and reduce public expenditure as well as consider State-funded projects which were of low feasibility.

So far, the city has saved VND368 billion (USD17.1 million) by cutting 10 per cent of public expenditure.

After checking on feasibility, districts propose to delay 114 projects with total investment capital of VND1,150 billion (US$53.4 million).

Nghi asked city authorities to continue promoting administrative reform that help investment and production.