return icon Vietnamnet.vn

BUSINESS IN BRIEF 24/9

Car imports skyrocket in 8 months; Vietnam ascends to largest fish supplier of Colombia; Many new projects added to coal development plan; PM instructs to cut half business starting, dissolving time; Debt support out of shrimp, tra fish farms’ reach

HCM City announces September CPI growth

Ho Chi Minh City recorded a rise in its Consumption Price Index (CPI) in September 2014, the municipal Statistics Office revealed on September 22.

The figure increased by 1.13 percent compared to the previous month, and the office reported a year-on-year increase of 3.16 percent.

According to the office, prices for educational goods and services increased the most compared to August, up by more than 19 percent, as consumers stocked up on school supplies for the new academic year. Equipment and household items increased by 0.39 percent; apparel and footwear by 0.3 percent and beverages and tobacco by 0.14.

A decrease was recorded for transport (2.03 percent); housing, electricity, water, and building materials (0.55 percent); restaurants and services (0.20 percent); and pharmaceuticals and healthcare services (0.04 percent).

In contrast to the CPI, the price of gold and the USD exchange rate fell by 0.93 and 0.03 percent, respectively.

Investor pledges additional $50mn for casino resort project in southern Vietnam

The Ho Tram Strip, a luxury resort and casino complex located in the southern province of Ba Ria-Vung Tau, has received a US$50 million funding commitment, the complex’s owner announced Monday.

Asian Coast Development (Canada) Ltd (ACDL) said its majority shareholder, Harbinger Capital, has just committed to investing an additional $50 million in the project, the second investment pledge it has received in the past two months.

In July, NewCity Capital, one of the Canada-based company’s minority shareholders, announced a $20 million investment in the resort casino project. The other minority shareholder of ACDL is Pinnacle Entertainment.

Harbinger Capital made its initial investment in the Ho Tram project in 2007, and the company remains “as excited about the project today” as it was seven years ago, company principal Philip Falcone said in a statement.

Falcone said Harbinger Capital is “excited” about the future development potential of the Ho Tram project.

“We are encouraged by the Vietnamese government’s progress on establishing a robust regulatory framework that will also provide a road map for the establishment of local gaming in Vietnam,” he added.

Also on Monday, ACDL announced the appointment of Stephen Shoemaker as chairman of the company's Board of Directors, as well as its President and Chief Executive Officer.

Shoemaker had previously served as ACDL's President and Chief Financial Officer since 2008. With over 30 years of financial and operating experience in the hospitality and telecommunications industry, Shoemaker has an extensive background in developing strategy, as well as overseeing financial operations and fund raising activities, according to ACDL.

The Ho Tram Strip project, estimated to cost $4.2 billion, is a group of integrated resorts and residential developments located on more than 400 acres of land in Ho Tram, a small beach town in Xuyen Moc District.

Its developer, ACDL, is an international development company specializing in integrated resort destinations.

The project boasts a wide range of features, from lavish entertainment to premium shopping and exceptional recreational facilities.

The first phase of its development, The Grand Ho Tram Strip, opened its doors in 2013, and includes a 541-room five-star hotel, a world-class entertainment facility, restaurants, high-tech meeting space, an exclusive VIP area, and a championship golf course, as well as a variety of beach-front recreation activities.

The Ho Tram Strip’s major future development phases include an additional 559 rooms and further leisure amenities.

Vietnam is drafting a decree which could allow local residents to enter casinos on home soil, including the gaming facility at The Grand Ho Tram Strip.

Car imports skyrocket in 8 months

In the first eight months of the year, Vietnam imported an estimated 37,300 vehicles valued at US$806 million, up 71.5% in volume and 91.9% in value compared to last year’s corresponding period, Vietnam Customs reports.

Of the figure, the Republic of Korea (RoK) remained the top supplier of automobiles to Vietnam with a 4.3% on-year jump to 10,300 units, followed by Thailand (over 7,400 units, up 64.3%).

Meanwhile, in August 2014 alone, Vietnam Customs statistics show that Chinese automobile exports to Vietnam posted an astonishing on-month growth rate of 187% to over 7,000 units valued at US$274 million.

The number of completely built units (CBU) imported from China has been on an upward trend over recent months with 5,600 purchased in June,5,920 in July, and 5,760 in August.

Vietnam ascends to largest fish supplier of Colombia

Vietnam surpassed all other nations to become the largest supplier of fish to the Colombian market in 2013, making up 36% of this South American nation’s total market share.

Tuna and Tra (Pangasius) fish alone accounted for 19% and 16% of the total frozen fish imports.

In the 1970s, Colombia’s river fish catch reached 70,000 tonnes per year. However, a sharp fall in output and limited farming in recent years forced the country to increase its imports from other countries, including Vietnam.

Fernando Bagés, a Columbian aquaculture expert, forecasts that tra fish imported from Vietnam will continue to uptrend thanks to its competitive price and consistent high quality.

GEF project helps promote non-fired brick production

The Prime Minister has approved the project “Promotion of non-fired brick (NFB) production and utilisation in Vietnam”, funded by the Global Environment Facility (GEF).

The project will be carried out through the country in five years with a total investment of nearly US$39 million, of which US$2.8 million will be provided by GEF as non-refundable aid through the UN Development Programme (UNDP).

Its expected outcomes are to promulgate policies that encourage the NFB manufacturing and use, strengthen the capacity of relevant government bodies in the field, and increase the number of local NFB providers.

It will also help enhance the availability of sustainable financial resources for investment projects on NFB and its technology, boost confidence in the financial feasibility as well as economic and environmental benefits of NFB production among financial institutions, brick manufacturers and management bodies, and increase the market share of non-fired bricks.

The project’s overall purpose is to help Vietnam reduce the annual growth rate of greenhouse gas emissions by gradually reducing the use of fossil fuels and good quality soil for brick making, while increasing the production, sales and utilisation of NFBs.

It is estimated that the direct and indirect cumulative CO2 emission reductions will be 383 ktonnes and 13,400 ktonnes, respectively, within 10 years after the project ends.

Nghe An sees 10.6 percent jump in industrial production

The index of industrial production (IIP) of central Nghe An province was expected to record a year-on-year increase 10.6 percent in the first nine months of 2014, according to the provincial People’s Committee.

Growth was registered in the fields of mining (0.9 percent), processing and manufacturing (12 percent), electricity and gas (3.9 percent) and water supply (9.9 percent).

High consumption of several products such as milk, sugar, clothes and brick also contributed to the IIP rise.

To boost industrial production, local authorities are strengthening measures to help businesses overcome difficulties, such as finding consumption markets, stepping up import-export activities, and spreading the campaign “Vietnamese prioritise using Vietnamese goods”.

The province is also encouraging enterprises to seek solutions to stabilising prices and preventing trade fraud.

Ha Giang seeks to boost tourism industry

Ha Giang provincial People's Committee has recently approved the master plan for tourism development in the province to 2020 and orientation towards 2030, the Vietnam Business Forum Magazine (VBF) reported.

By 2020, Ha Giang tourism aims to play an important role in the provincial service industry, creating the premise towards 2030 for tourism to be a key economic sector in its economic structure, contributing to raising living standards of the people.

Ha Giang has an important position on the national tourism map. It is also a land of rich cultural history, the convergence of the 19 ethnic groups such as Mong, Dao, Pa Then, Co Lao, Lo Lo, Bo Y, Phu La, and Pu Peo.

The province also possesses many national historic sites namely Dong Van ancient town, the Vuong dynasty architectural relic, Lung Cu flagpole (Dong Van); Sung Khanh Pagoda, Binh Lam Pagoda (Vi Xuyen); Trong Con Subregional revolutionary relics (Bac Quang); Cang Bac Me (Bac Me), ancient rocks Nam Dan (Xin Man), and Hoang Su Phi terraced fields.

Ha Giang also has peculiar natural scenery, with spectacular wild beauty as: Ma Pi Leng (Meo Vac), Double Mountains (Quan Ba), desert rock, stone forests (Dong Van), etc primeval forests, ancient tea forest, scenic rice terraces in the western districts.

According to Hoang Van Kien, Director of Ha Giang’s Department of Culture, Sports and Tourism, Ha Giang is located in a strategic position in terms of economic, social, defence, security and tourism development.

In recent years, the social and economic development of Ha Giang province has achieved encouraging results. The infrastructure is continued to be invested, creating conditions for Ha Giang tourism to develop.

However, Ha Giang tourism is at an early stage of development. Under the master plan for tourism development up to 2020 and orientations towards 2030, the province will focus on developing various tourism products such as geological tourism, cultural tourism, and community-based tourism.

In addition, Ha Giang will develop traditional craft products, and culinary tourism. Specifically, by 2020, Ha Giang tourism industry needs to invest 24 projects in various sectors, giving priorities to Dong Van Plateau Global Geopark and Hoang Su Phi terraced fields.

Smile of Viet Nam prizes handed out to 110

More than 110 travel and hospitality enterprises were honoured at the 15th Guide Awards ceremony held in the central city of Nha Trang last Saturday.

The award, themed Smile of Viet Nam, is an annual prize of The Guide, a publication of Vietnam Economic Times designed to promote tourism. Enterprises were selected by the votes of readers and the magazine's editors.

Receiving the highest number of votes were the Best Western Premier Indochine Palace in Hue City; the Caravelle Hotel, InterContinental Asiana Saigon, Sofitel Saigon Plaza and Ngon Restaurant in HCM City; the Sofitel Legend Metropole in Ha Noi; the Furama Resort in Da Nang City; the Paradise Cruises in Ha Long Bay; and the Vinpearl hotel chain.

Call to export more building materials

The domestic building materials industry should promote efficiency in the export of its products in the future because the domestic market has yet to fully recover from crisis, experts said.

The Industry and Trade newspaper quoted the Ministry of Construction (MoC) as saying the export of building materials was needed to reduce the pressure of high inventory, maintain production stability and improve competitiveness in the world market.

Leading exporters of building materials in Viet Nam are pottery and ceramic producers, including Viglacera, Vinaconex and Hoang Gia, as well as Hong Ha, Taicera and Toto. They have been scouting for export markets by joining international trade fairs and exhibitions and have so far exported products to 40 countries and territories.

Luyen Cong Minh, chairman of the Viet Nam Building Glass and Ceramic Corporation (Viglacera), said his company expected to gain total export revenues of US$31.5 million from building materials, though the industry was still facing numerous difficulties in production and business.

The domestic building materials industry has achieved high export volume but remained saddled with the low value of its products, said the ministry.

Le Van Toi, head of the MoC's Building Material Development Office, said Viet Nam has advantages in developing the potential of building materials exports, but the industry was facing numerous challenges, including the lack of mechanisms and policies for encouraging exports.

Also, building materials producers haven't been actively seeking export markets and haven't been investing enough in trade promotion activities, Toi added.

To solve these difficulties, the enterprises should pay attention to opportunities for exporting their products, said Nguyen Quang Cung, chairman of the Viet Nam Cement Association.

The exports could not bring in huge profits but exporting will help domestic enterprises overcome existing difficulties in production and business and also compel them to upgrade production quality according to global standards, Cung added.

Tran Quang Huy, head of the African, West Asian and South Asian Markets Department under the Ministry of Industry and Trade, said the Middle East was one of the potential markets for building materials exports due to the high demand for such products there.

Vietnamese enterprises should be more active in studying and researching the Middle East market and should ensure that their products meet quality and environment standards in that market, Huy added.

To improve the quality of exports, Toi said, domestic enterprises in the building materials industry should restructure themselves to set up complexes with strong financial ability that manufacture and trade building materials that conform to international product standards.

Many new projects added to coal development plan

Prime Minister Nguyen Tan Dung has approved the inclusion of at least eight projects in the country's coal industry development planning for 2020 to 2030 to meet domestic demand, especially for electricity.

The Ministry of Industry and Trade made the proposal amid fears of a shortage of coal in Viet Nam for electricity generation and industrial production beginning next year.

Industry experts forecast expect the country to face a coal shortage beginning next year, especially for electricity generation, which might amount to 50 million tonnes by 2020.

An estimate posted on the website of the Viet Nam National Coal, Mineral Industries Holding Group (Vinacomin) said the country must import about 1.3 million tonnes of coal in 2015 and 64 million tonnes in 2020 to make up for the shortage.

On coal extraction projects, the Prime Minister has agreed to add to the planning Nam Trang Bach mine with a capacity of 500,000 tonnes per year, Cai Da mine with a capacity of 300,000 tonnes per year, and Khe Tam and Tay Nam Khe Tam mines, each with a capacity of 200,000 tonnes per year.

Also added is Dong Da Mai mine, in the northern Quang Ninh Province's Cam Pha mining zone, which will have its capacity increased from 450,000 tonnes per year to 1.5 million tonnes per year.

The project in Tan Yen and Dong Trang Bach in the Uong Bi-Dong Trieu-Pha Lai mining zone will be split into two separate projects with a capacity of 200,000 tonnes and 450,000 tonnes, respectively. The exploratory project of Nui Hong mine was also added.

According to the coal industry development planning by 2020, with vision to 2030, which the Prime Minister approved under Decision 60/QD-TTg, the coal industry's output is expected to reach 55 million to 58 million tonnes by 2015, 60 million to 65 million tonnes by 2020 and more than 75 million tonnes by 2030.

At the end of last year, however, Vinacomin reported that the estimated reserve of the Dong Bac (North East) coal basin was 20.8 per cent lower than the figure in the planning. As a result, the maximum coal output by 2025 to 2030 could be around 65 million tonnes only, or 10 million tonnes lower than the target.

PM instructs to cut half business starting, dissolving time

The Prime Minister has instructed the Ministry of Planning and Investment to cut short business registration and dissolving time by 50 percent compared to the current average time in the revised enterprise law.

He instructed completion of the revised law before December 31, according to an announcement from the Government Office.

The ministry should conduct overall examination over the revised law to abolish unnecessary procedures, which have caused difficulties and inconveniences for businesses.

The dissolving process must be clear facilitating business withdrawal from the market and a national database on business registration should be quickly accomplished.

Vietnam urged to quickly improve supporting industries

The Japan External Trade Organization (JETRO) in HCMC called for Vietnam to speed up improvement in supporting industries to help companies, particularly those from Japan, reduce heavy dependence on imports.

Hirotaka Yasuzumi, managing director of JETRO in HCMC, raised the point at a seminar on solutions to develop supporting industries in Vietnam in HCMC last week. The event was organized by the Industrial Policy and Strategy Institute, Heavy Industry Department and Vietnam Trade Promotion Agency in collaboration with the city’s Department of Industry and Trade.

Yasuzumi said Japanese enterprises in Asia generally spend 60% of their costs on materials and components. If they can cut spending on this part, they will be able to reduce selling prices of their products and enhance their competitive edge.

A survey conducted by JETRO in 2012 indicated that the local content ratio of Japanese products made in Vietnam accounted for less than 28%, well below 61% in China and 53% in Thailand.

According to the Ministry of Industry and Trade, the manufacturing sector has to import some 80% of material and component needs. As a result, prices of Vietnam’s exports are often higher than those made in other regional countries and the world.

For example, automakers in Thailand have parts provided by local companies, and this is why autos assembled in Thailand are cheaper than in Vietnam.

Yasuzumi said supporting industries in Vietnam have been set up for a long time but are now underdeveloped due to the lack of appropriate policies to fund enterprises in the sector. Notably, finances for supporting industries are limited.

Yasuzumi gave an example that small- and medium-sized enterprises (SMEs) in Vietnam take out loans with annual lending rates of 8-15% while SMEs in Japan enjoy preferential rates of 1-3% per annum. The Japanese government is also willing to share risks with its enterprises.

Speaking at the seminar, Truong Thanh Hoai, deputy head of the Department of Heavy Industry under the ministry, said the Government will issue a decree propping up supporting industries.

Siemens consortium, EVNSPC ink deal for power distribution control

A Siemens consortium clinched a contract with Southern Power Corporation (EVNSPC) in HCMC last Friday to design, supply, install and commission a Supervisory Control and Data Acquisition/Distribution Management System and 110kV Unmanned Substations in southern Vietnam.

Siemens said in a statement that the US$15-million contract for Package DEP-SPC-SCADA-1 was awarded to the consortium of Siemens AG, Power Automation – a joint venture between Siemens and Power Singapore, and Siemens Limited Vietnam in connection with the Distribution Efficiency Project (DEP) funded by the World Bank.

EVNSPC said the contract has been given to the Siemens consortium after more than one year of tender organization as well as result check and approval by the international lender.  

Installed and ready for operation by September 2016, the Supervisory Control and Data Acquisition/Distribution Management System (SCADA/DMS) is expected to improve the availability and efficiency of the distribution networks in 21 cities and provinces in the southern region of Vietnam as well as reduce power losses.

SCADA systems are used for the operator interface and for the control and monitoring of power networks while the combined DMS optimizes distribution network control. Spectrum Power, the SCADA/DMS product from Siemens, enables grid operators to control the network management and the energy flow. Furthermore, it helps to cut the cost of network maintenance and to speed up the elimination of faults.

Besides, 110kV Unmanned Substations will help EVNSPC make a huge saving from more efficient and effective utilization of their labor source.

Siemens said the contract volume for Siemens Smart Grid is the first project of its type to be implemented in Vietnam and EVNSPC is the pioneer in application.

Thai Lai Pham, president and CEO of Siemens Vietnam, said in the statement that the SCADA/DMS systems of Siemens are successfully proving their worth in operation for numerous power providers and network operators over the world.

“And they have now arrived in Vietnam with EVNSPC to be our very first customer. This project is a benchmark in the power distribution industry in Vietnam, making its way to four more similar projects, which will be implemented here in the near future,” Lai said.

Siemens is committed to bringing its latest technology and quality service to Vietnam and offering as much as support it can to Vietnamese customers. “As such, we strongly hope to be able to accompany Vietnamese utility companies throughout the exciting journey ahead,” Lai said.

Nguyen Thanh Duy, president and CEO of EVNSPC, said it is good for the company to be the pioneer in applying the most advanced technology in the power distribution industry.

“The SCADA/DMS system, which is designed, supplied, installed and commissioned by Siemens Consortium, will help our company to remarkably improve the efficiency and reliability of the distribution network in 21 provinces and cities in the southern region of Vietnam thus contributing to the economic development in this region,” Duy said.

Siemens Vietnam opened offices in 1993 and has since has participated in numerous infrastructure projects in this market, particularly in energy, industry, healthcare and transportation.

Debt support out of shrimp, tra fish farms’ reach

The State Bank of Vietnam (SBV) will refinance credit institutions that reschedule debt for ailing shrimp and tra fish farm owners and cooperatives from this November, but experts are skeptical that the supportive policy is still out of their reach.

The central bank earlier told commercial banks to reschedule loans and extend maturity deadlines for the farms and cooperatives. However, experts pointed out that there have been many shortcomings and doubted the implementation of the policy.

Nguyen Ngoc Hai, head of a tra fish cooperative in Can Tho City’s O Mon District, said many local households have yet to benefit from the supportive policies despite losing debt solvency.

“Farmers have applied for debt rescheduling, but banks have rejected them although the central bank has refinanced a number of lenders,” Hai said.

Nguyen Thanh Binh, a tra fish farmer in O Mon District, said he had many times written to Agribank asking for a rescheduling of his VND2-billion loan. Binh has been unable to service his loan and interest as his five fish farms were hard hit by diseases.

However, the bank turned down his request, saying this was not a sound reason as only one or two farms were hit by fish diseases and the bank only offered to reschedule loans if a majority number of tra fish farming households in the locality were in the same boat as Binh.

Currently, Binh has to pay around VND20 million in the interest for the loan a month.

Vo Tu Vinh, deputy director of Agribank’s O Mon District branch, said the unit has just extended payment deadlines for customers and debt rescheduling only applies to the borrowers who suffer from natural disasters and diseases. Most local customers incurred losses due to low sale prices.

For farmers who fail to pay interest and principle, banks have given them an extension, for instance by one or two years, Vinh said.

Nguyen Van Nhiem, chairman of My Thanh Shrimp Association in Soc Trang Province, said many local households have suffered losses due to diseases, but banks have refused to reschedule their loans.

According to Circular No. 26/2014/TT-NHNN, the SBV will refinance the banks that which have frozen and rescheduled loans for shrimp and tra fish farming households, farm owners and cooperatives grappling with difficulties in their production and business operations and debt payments as of December 31 last year.

Refinancing with a zero interest rate will be equivalent to the loans that lenders have rescheduled. This refinancing will be implemented within 364 days and will be renewed automatically each year for a period of three years.

After three years, the credit institutions will have to pay the loan amount to the central bank. If the institutions fail to meet the deadline, the SBV will transfer the remaining debt to overdue loans and carry out measures to retrieve them.

Piaggio Vietnam recalls 14,290 vehicles

Piaggio Vietnam has announced a plan to recall 14,291 Vespa 3V scooters to fix a technical fault related to the fuel line though no incident related to this problem has been reported.

The recall covers Vespa LX 3V i.e, Vespa S 3V i.e, Vespa LXV 3V i.e and Vespa LT 3V i.e models that were manufactured between May 13 last year and January 10 this year.

The company said as checks have found that certain fuel lines fail to meet the Piaggio’s quality standards, which may lead to fuel leaks in some cases, the manufacturer has decided to check all those models and replace new fuel lines if the fault is discovered.

Piaggio Vietnam will have all the scooters examined and replace the defective part, if any, at no charge, and this process takes from 10 minutes to an hour.

As the exclusive importer and distributor of the Vespa 946 model in Vietnam, Piaggio Vietnam also recalls the 2013 version of this model for safety checks. The company will replace new fuel lines in case of need.

Piaggio Vietnam’s customer service department will inform customers of the recall program by sending letters to or telephoning them.

Customers can visit www.vespa.com.vn, call 1800555585 or email to customer.service@piaggio.com.vn for more information about the program.

ADB president sees private sector as growth driver

President of the Asian Development Bank (ADB) Takehiko Nakao has called for Vietnam to attend more to development of the private sector as it could help the country get out of a middle-income trap.

Speaking at a press conference in Hanoi City last week, Nakao said the private sector plays an important role in supporting Vietnam to improve its competitiveness and avoid the middle-income trap.

Fast reform of State-owned enterprises (SOEs) will contribute much to realizing the goals. Nakao said there are still too many SOEs and it is difficult for the enterprises to operate effectively if they are not restructured.

The Government should secure effective implementation of business laws and regulations to create a level playing field for all economic sectors and develop a healthy environment for competition, he added.

Vietnam has been among the fastest-growing economies in the world since 1990 and became a middle-income economy in 2010. Economic growth, however, has slowed down, from an average rate of 7.3% in 2000-2007 to 5.7% in 2008-2013, due to slower-than-expected structural reform and global economic uncertainties.

ADB projected Vietnam would grow 5.6% this year and encouraged the Government to strive to post growth of 7-8% in the following years, Nakao said.

Earlier, Nakao met State President Truong Tan Sang, Prime Minister Nguyen Tan Dung and State Bank of Vietnam governor Nguyen Van Binh.

Speaking to the Vietnam leaders at his separate meetings, Nakao emphasized that Vietnam has maintained political stability and improved its macro-economy and these are the two key drivers for Vietnam’s socio-economic development.

“To solidify the gains made and restore high and inclusive economic growth, structural reform - primarily of SOEs and the banking sector - needs acceleration. The Government also needs to handle public debt by broadening the tax base and rationalizing public expenditures,” he said.

Nakao also attended the 5th Asian Devepment Forum in Hanoi, where he gave a keynote address outlining an 8-point agenda to sustain growth in Asia – macro-economic stability, adequate infrastructure, expanding human capital, open trade and investment regimes, good governance, commitment to inclusive growth, a well-articulated and shared national development strategy, and security and political stability.

Vietnam is one of the founding members of ADB in 1966. ADB resumed its Vietnam operations in 1993 and by late last year the regional development lender has provided US$12.85 billion in aid for the country, including loans of US$12.43 billion, 276 technical assistance projects worth US$253.5 million and 29 grants amounting to US$170 million.

Vietcombank, Smartlink aid Vinecom in retail service

The Bank for Foreign Trade of Vietnam (Vietcombank), Smartlink Card Service Joint Stock Company and Vinecom Co. Ltd. last Friday struck a cooperation deal for banking services, including retail and payment facilitation.

Vietcombank will join hands with Smartlink to provide banking services, including retail service, to Vinecom to aid it in offering better products to customers and facilitate their payments, according to Vietnam News Agency.

Dao Minh Tuan, deputy general director of Vietcombank, said Vietcombank is the first bank to lay the groundwork for e-payment services in Vietnam. Retail development is one of the strategies of the bank.

Vinecom is active in the e-commerce sector and is an affiliate of Vingroup Company.

Stricter rule for main construction contractors

Engineering, procurement and construction (EPC) and foreign contractors will not be allowed to hire sub-contractors to do all construction works of the contracts they win as clarified by a decree on construction contracting.

The Ministry of Construction said the decree is one of the five decrees guiding the 2014 Construction Law, which was passed by the National Assembly last June and will come into force next year. The decree was put on the table for comments at a seminar in HCMC last week.

Pham Van Khanh, head of the ministry’s construction economic department, said it is popular in the world that when main contractors are awarded construction contracts, they hire sub-contractors to take charge of the components of the contracts for them. This requires contractors to have lots of expertise and experiences which few contractors in Vietnam can meet.

Therefore, the rule will be applied to secure quality of construction works. Notably, it will permit the main contractors to share management and inspection activities with sub-contractors.

In reality, conflicts have occurred between the main contractor and the investor when the former uses sub-contractors who lack experiences or cannot control sub-contractors during the process of construction.

To avoid the situations, Khanh said the new rule requires the main contractor to bear full responsibility for the quality of construction works executed by the sub-contractors they hire.

Many delegates at the seminar voiced against the rule, saying that it is not practical in the current time as in reality, many foreign contractors only manage to win tenders and then assign sub-contractors to implement their contracts.

Nguyen Ngoc Toan, deputy general director of Cuu Long Corporation for Investment Development and Project Management of Infrastructure, said a construction structure comprises of tens of packages and Vietnamese sub-contractors are capable of carrying out these packages.

Toan suggested the Ministry should allow sub-contractors to do all the jobs assigned by the main contractor as one of the measures to create jobs for local laborers in the construction sector.

Nguyen Tien Thao from the Irrigation Project Investment and Construction Management Unit No.8 raised concerns that investors have had to compensate for main contractors for being late in site clearance, which is actually the responsibility of local authorities.

Thao suggested that the decree on construction contracts should clarifies the responsibilities of contractors and investors to avoid such conflicts.

Regarding insurance for buildings, Khanh said the decree regulates that only buildings which affect public safety and the environment, and those requiring special technologies and carried out under complicated conditions need to be insured.

Deputy Minister of Construction Le Quang Hung said the advantage of the Construction Law is that it makes clear the process of construction investment management for projects to be implemented with different sources of capital. It also contains strict regulations on responsibilities of contractors.

Cruise ship arrivals in Hue on the rise

Over 34,000 cruise ship passengers have arrived in the former imperial capital of Hue this year to date, nearly the same as the total number recorded in all of last year, said a provincial tourism official.

With two trips to the city’s Chan May port since early this year, the five-star cruise ship Celebrity Millennium of the Royal Caribbean Cruise Lines Co. Ltd had brought more than 5,200 tourists and crew members to Hue. The American cruise ship is slated to make eight trips to Chan May Port this year, said Phan Tien Dung, director of the provincial Department of Culture, Sport and Tourism.

Thua Thien-Hue government, in cooperation with relevant agencies, has mapped out plans to attract more cruise ships.

In the short term, the province will focus on improving tourism services. At the same time, the provincial government will strengthen promotional activities in foreign and domestic tourism fairs to attract more visitors to Chan May Port for longer stays.  

At a workshop on Vietnam’s sea tourism development strategy in Festival Hue 2014, the Royal Caribbean committed to implement projects on infrastructure development including dredging the channels leading to Chan May Port.

This cruise line plans to bring its first passenger ships to Vietnam from the beginning of next year. Cruise vessel tourist arrivals are expected to reach 25,000 a year.

Among 46 seaports chosen as stopovers for cruise ships in Southeast Asia by the Asia Cruise Association (ACA), Chan May Port is in the middle of an international sea lane connecting Singapore, the Philippines and Hong Kong.

In addition, it is located in the center of the country and close to some key tourist destinations. It is also the eastern gateway to the sea close to the East-West Economic Corridor area linking Myanmar, Laos, Thailand and Vietnam.

Currently, Chan May Port can accommodate 30,000-DWT vessels and international cruise ships with 3,000 tourists.

CTU to boost scientific studies, technology transfer

Can Tho City-based Can Tho University (CTU) will strive to boost technology transfer and commercialize more scientific research projects to support socio-economic development, particularly in the Mekong Delta region.

Associate Professor Ha Thanh Toan, rector of the university, unveiled the goal at an opening ceremony of the 2014-2015 academic school year last Friday. He said the university will intensify cooperation with domestic and foreign partners in doing scientific research and making them applicable in reality.

Toan told the Daily that the university would increase technology transfer to make more products bearing the university’s brand to fuel socio-economic development in the delta. These products include organic fertilizer, biological fungicides, shrimp feed, foods and beverages.

The university will cooperate with PetroVietnam Ca Mau Fertilizer Company Limited in fertilizer products and transfer technology of producing organic fertilizer to Tan Kim Phuc Company. Besides, the school will work with Rang Dong Light Source and Vacuum Flask Company, Vietnam Brewery and the Vietnam Association of Seafood Exporters and Producers over contracts worth tens of billions of dong in total.

Scientific researches and technology transfer, according to Toan, will help CTU become one of the top research universities in Vietnam and are part of the Japanese ODA-funded scheme to make CTU a leading school in terms of training, scientific research and technology transfer.

The university has so far cooperated in scientific studies and human resource development with the Mekong Delta localities of Can Tho, Vinh Long, Hau Giang, Ben Tre, Long An, Dong Thap and Tien Giang as well as the Central Party Committee’s Economic Commission.

CTU currently has over 53,200 under-graduate students and over 3,700 post-graduates attending Master’s courses on 90 fields.

Mahaphant Group opens rep office in city

Thai non-asbestos fiber cement maker Mahaphant Group has inaugurated a representative office in Vietnam at the 8th floor of IBC office building in District 1, HCMC as part of a strategy to set up a presence in this market for growth, particularly for its SHERA brand.

Sarat Khiatbanlue, ASEAN president of Mahaphant Group, said in a statement that the group’s presence in Vietnam is in sync with a marketing program to expand its distribution network, build customer relationships and promote brand awareness for SHERA in order to penetrate its target segments, including architects, designers, contractors and homeowners in the ASEAN region.

According to the company, it continues a solid expansion with stable growth in Vietnam. The property market has also shown some sign of recovery since the beginning of this year, offering room for growth for construction materials.

The company said there is still an undersupply of social housing for low-income people.

Khiatbanlue said the group sees opportunities in the ASEAN region to be a driving force for eco-living and environmentally friendly fiber cement production. In Vietnam, he also believes the company will contribute to eco-living and environmentally friendly fiber cement manufacturing.

Mahaphant is not a newcomer in Vietnam since its fiber cement brand SHERA has been imported and distributed by local distributors such as Thanh Phong, Fortune, or Mirolin Hanoi for a long time. The business expansion is also aimed to meet the rising demand for the building material industry in this market.

SHERA fiber cement boards provide fast build, dry construction with fire, and termite and moisture resistance. Besides, they give stability in different climate conditions for applications in interiors and exteriors and wet areas.

In Asia, Mahaphant is one of the biggest fiber cement board, siding and roofing and concrete roof tile manufacturers. Founded in 1974 in Thailand, the group has established a network of business partners in more than 40 countries and territories in Asia, the Middle East, Africa, Oceania and Europe.

E-United determined to move on with US$4.5 billion steel project

E-United has expressed its strong determination to continue its Guang Lian steel project in Dung Quat Economic Zone in Quang Ngai Province after Japan’s JFE Steel Corporation withdrew from the US$4.5 billion project.

The Taiwanese investor told a meeting with the management board of Dung Quat Economic Zone last week that it wanted to proceed with the project and break ground for the foot-lagging project by end-September next year.

Le Van Dung, deputy head of the management board, told the Daily after the meeting last Friday that E-United has been asked to show a detailed road map for building components of the project to prevent the project from being further delayed as it has been in the past years if it is still determined to invest in the project.

At the meeting, E-United elaborated on what has been done and will be developed at the project in the central province. Dung said the board will report the case to the government of Quang Ngai Province and the Ministry of Investment and Planning before a final decision on the fate of the project.

In fact, work on the mammoth project started in 2007 and the investor has since spent US$40-50 million on accommodation facilities for workers, ground leveling, and works for project boundary and production factory preparations among others.

The steel project was licensed in 2006 with initial investment capital of US$1 billion. The local government has allocated 330 hectares of land to the investor and many times urged it to complete the project as pledged.

However, the project has not been able to turn out any products so far though it has since been handed over to a number of investors.

In 2012, Japan’s JFE Steel Corporation unveiled its plan to partner with E-United to carry out the project. The investors proposed expanding the project on nearly 700 hectares with annual production capacity planned to increase from five million to seven million tons and investment capital from more than US$3 billion to US$4.5 billion.

But, the management board of Dung Quat Economic Zone told the Daily early last week that JFE had pulled out of the project, which consists of two furnaces and other facilities such as ports, material sections and maintenance stations.

Industry insiders have concerned that localities have licensed too many steel projects in the past years without considering supply and demand on the local market, the financial capacity and experiences of investors, and infrastructure development for relevant sectors such as electricity, ports and roads.

Reality showed that a number of big-ticket steel projects have not got off the ground after having been licensed for years as their investors lack capital and are slow in site clearance and compensation. Moreover, the drawing up of implementation plans and approval for such projects are often time-consuming.

Vietnam, Czech Republic roundtable on investment

A Vietnamese-Czech forum was held in Prague on September 22 by the Vietnam trade office in the Czech Republic and the Czech Trade Department to boost bilateral trade and investment.

Participants included representatives from the Euro-Vietnam Business Networking (EVBN), and the Czech branch of the Bank for Investment and Development of Vietnam (BIDV) and Czech businesses.

Addressing the event, Minister Counsellor of the Vietnamese Embassy in the Czech Republic Hoang Thuy Duong said the economic ties between the two countries have grown substantially, with two-way trade totaling 546 million USD last year.

However, Duong said, the cooperation has not yet reached their full potential, with just over 30 Czech investment projects in Vietnam so far, mainly in the fields of glassware, construction materials, electronic equipment, and food processing.

In his report , “Vietnam - trade and investment opportunities” , Commerce Counsellor Nguyen Thanh Long highlighted that Vietnam welcomes Czech enterprises and investors to come to the country to research market conditions, seek partners, and build alliances with a view to producing in or exporting to Vietnam.

He added that Czech businesses are currently drafting a number of investment plans for operations in Vietnam.

Meanwhile, EVBN representative Jana Ackermann disclosed that investment opportunities in Vietnam are very promising as the country boasts huge potential and open market.

At present, around 40,000 Vietnamese live and work in the Czech Republic.

Customs-business coordination required for intellectual property rights

The close coordination between customs agencies and enterprises is crucial for the protection of intellectual property rights, and the prevention and detection of violations, a senior leader of the Hanoi Department of Customs said.

Deputy Head of the department Van Ba Tin addressed a conference in Hanoi on intellectual property rights protection during the implementation of the Vietnam Automated Cargo and Port Consolidated System/Vietnam Customs Information System (VNACCS/VCIS), which was co-organised by the department and the organisation React, an international anti-counterfeit network.

In order to enhance efficiency, enterprises should provide customs officials with information on their goods before they are imported, he said.

Tin also noted that unfortunately the increase in international trade went hand-in-hand with an increase in fraud and fake products. Intellectual property rights violations were not just harmful for the economy and trade, but also for consumers’ health, he said.

Currently, Vietnam is undergoing a strict process of inspection and supervision of imported and exported goods via VNACCS/VCIS. The role of customs authorities in preventing violations of intellectual property rights was therefore more important than ever before, he stressed.

Meanwhile, Tran Viet Hung from the Anti-Smuggling Investigation Department under the Customs Department of Vietnam said that since VNACCS/VCIS was new to Vietnam , customs authorities needed further information on products and trademarks.

Learning from other countries’ experience in protecting intellectual property rights would help Vietnam build an effective inspection processs and control over violations, he added.

During the event, business representatives expressed their opinions on how to manage goods better and protect intellectual property rights.

According to Le Viet Hung of The North Face, the new e-customs system has made it possible for central offices to instruct local customs officials on strengthening inspections on suspected cases.

He also provided information on the differences between real and counterfeit The North Face products to help customs officials distinguish correctly.

Vietnamese products marketed in France

Vietnamese Goods Week in France opened in Paris on September 22, offering a chance for Vietnamese businesses to boost their exports in France and other EU nations.

During the week, many local products ranging from fruits, vegetables, frozen shrimp and fish, and spring rolls, to dried vermicelli and instant noodle will be bought off the shelf at Casino Saint Didier supermarket.

At the opening ceremony, Vietnamese Deputy Minister of Industry and Trade Ho Thi Kim Thoa spoke of the fine cooperation between the two countries, particularly between Casino Group that owns the Big C supermarket chain and Vietnam. She said she hopes that the event will signal a good start of further cooperation activities in the future.

Casino, one of France’s leading retailers and distributors, has operated efficiently in Vietnam for the past 15 years with its Big C supermarket chain. Big C Vietnam General Director Laurent Zecri said he believes Vietnamese products will be able to successfully penetrate France and the EU through Casino’s distribution network.

With a wealth of experience, Big C wants to promote and expand sales of high quality Vietnamese products not only in France but also the EU as well, he said.

Zecri took frozen shrimp imported from Vietnam as an example, saying the product has now gained a firm foothold in the EU thanks to its competitive price and safety.

Vietnamese Ambassador to France Duong Chi Dung expressed his hope that more similar events will be held in other French cities, enabling local people to taste Vietnamese products.

The event is part of a Government-level project to promote Vietnamese products in European markets and help businesses introduce and sell goods directly to EU supermarkets.

Duration of customs clearance process revealed

The length of Vietnamese customs clearance processes was shared for the first time at a meeting in Hanoi on September 19.

Data revealed that the average customs clearance process for imports took more than 115 hours; the shortest taking just several hours and the longest taking 1,400 hours.

Meanwhile, it took an average of 11.6 hours for customs agencies to handle procedures relating to exports.

The study was conducted between September 9-14, 2013, in eleven sub-departments of the Customs Department in seven localities, including Ho Chi Minh City, Hanoi, Hai Phong city, and Ba Ria-Vung Tau province. More than 7,400 customs declarations for goods traded by sea, air and land were surveyed in accordance with the World Customs Organisation’s standards.

Participants in the meeting said such a disparity between processing imports and exports meant relevant agencies should urgently develop measures to adjust it.

Hoang Viet Cuong, Deputy Director of the General Department of Vietnam Customs, admitted that the customs sector should overhaul its clearance processes to minimise the time needed to inspect goods, and expand the e-tax declaration and payment scheme.

Additionally, the sector will consolidate risk management capacities and closely monitor enterprises that have not complied with customs regulations.

From now on, the customs clearance duration survey is to be conducted three times every five years, with the next study taking place in 2015.

 

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

MORE NEWS

French Development Agency pledges more support for projects in Vietnam

The French Development Agency (AFD) will increase its support and donations for projects funded by French non-governmental organisations and associations in Vietnam.

Vietnam seeks stronger education partnership with US

Minister of Education Nguyen Kim Son on September 25 concluded his US working trip that aimed to strengthen education partnership between the two countries.

VIETNAM NEWS HEADLINES SEPTEMBER 25

Central localities likely to be hit by typhoon Noru

AI integration the inevitable path ahead

Big Data and AI will be the optimal tools to run factories in the future and digital transition will help firms optimise costs and cut emissions.

Ministry to scrutinise VietGap certifications after fake labels found on vegetables

The Ministry of Agriculture and Rural Development is investigating reports of vegetables sold in supermarkets being marked with fake Vietnamese Good Agricultural Practices (VietGap) labels.

E-commerce sector in dire need of qualified candidates

The tight supply of qualified candidates in the labour market is a glaring issue facing e-commerce firms, according to insiders.

Unique green moss-covered homes of the Tay Con Linh mountain range

It is an ideal environment for plants to flourish and thrive, including thick green moss, which ethnic people use to cover the palm-leaf roofs of their homes.

Farmers save wild birds and the environment

Farmers in different provinces throughout Việt Nam have for years spent time and effort to save wild birds, giving them a home to nest and lay eggs.

Deputy PM highlights significance of int'l solidarity, cooperation at UN session

The strengthening of international solidarity and cooperation is key to addressing interlocking global challenges, affirmed Permanent Deputy PM Pham Binh Minh while addressing the general debate of the 77th Session of the UN General Assembly.

Huge potential for luxury real estate in Vietnam

The branded residence market is gaining a stronger foothold in the Vietnamese market with potential to further develop, shaping the lifestyle of the country’s elite, according to experts.

VIETNAM BUSINESS NEWS SEPTEMBER 25

Action plan to promote green growth in agriculture

Vietnam’s economic growth counts on high-tech FDI

Vietnam’s economic growth has been accelerating in 2022, with experts considering high-tech foreign investments as a driver.

The “seven-star” islands in Quang Ninh

Along with crystal blue sea and beaches, the 7 Sao (seven star) islands also have caves and primeval forests.

Customs you only see in Vietnam

The travel site Culture Trip has listed a number of Vietnamese customs that often surprise foreign tourists:

Investors and buyers play waiting game in credit switch

The State Bank of Vietnam finally created extra credit room for some banks on September 7. However, the extension is deemed low and may not help real estate businesses and homebuyers access feasible capital sources for their projects.
back_to_top