Saigon Hi-Tech Park attracts investment capital

Chairwoman of the Ho Chi Minh City People's Council Nguyen Thi Quyet Tam and a delegation from the HCMC People’s Council worked with Saigon Hi-Tech Park (SHTP) management board on January 18.

According to head of the Saigon Hi-Tech Park (SHTP) management board Le Hoai Quoc, the park attracted 28 projects with its total investment capital of US$ 1, 5 billion last year; especially, three projects of Sonio, United Healthcare and Samsung Company increased US$ 634, 5 million investment capital.

At present, SHTP has issued investment certificates for 92 projects with total investment capital of US$ 5, 3 billion from top 10 most valuable technology brands in the world.

Recently, investors have increased newly investment capital that affirmed sustainable development of SHTP. SHTP’s export turnover last year hit US$ 4, 66 billion, accounting for 20 percent of total export value (eliminated crude oil export) and 92 percent of total export value of the country’s exports of high-tech products.

In order to ensure sustainable development, management board of SHTP constantly supported enterprises to develop the innovation and technology research projects.

Ms. Nguyen Thi Quyet Tam said: “SHTP not only becomes a model of the country’s successive high technological zone, but also attracts the world’s leading enterprises contributing to introducing the city’s brand name and image. However, the growth rate target is significantly lower than target of the city. In the upcoming time, the management board of SHTP will continue to seek cooperative opportunities and boost ties between domestic and foreign enterprises”.

Optimistic signal in rice export of Vietnam in early 2016

According to the Vietnam Food Association (VFA), export of rice in early 2016 has seen more advantages than it did in the same period last year with contracts of 1.3 million tons of rice passed from last year and import demand from large and regular markets coming earlier.

Export of Vietnamese farm produces, except cashew nuts and black pepper, faced several difficulties, including low export prices and cutthroat competition in 2015, especially rice. The total number of 6.58 million tons of rice exports by the end of 2015 caught us by surprise as the market was subtle earlier with rice export dropping in both volume and value from the beginning of 2015 to mid-October.

Huynh The Nang, chairman of VFA, said that global rice market was tough in 2015 with export prices falling extremely low. Export of rice in 2015 divided into two periods. From the beginning of 2015 to September, rice export market was gloomy while inventory was fairly high. The volume of rice for temporary stockpile piled up in exporters’ warehouses. In comparison with global rice price at that time, domestic rice price was higher; therefore, rice export target had to be lowered.

Food trading and export companies, including Vietnam Southern Food Corporation (Vinafood 2), had been meeting with serious difficulties because of excessive rice supply in global market. Rice inventory of Thailand, Vietnam’s main rival, was extremely high that Thai Government sought to sell rice in every way, causing severer competition. As most food exporters are small and medium businesses, excluding Vietnam Northern Food Corporation (Vinafood 1) and Vinafood 2, when the market changes, they merely receive razor-thin margins.

If there were not two export contracts to Philippines and Indonesia in the last months of 2015, many businesses would have fallen into losses. The two government-to-government rice export contracts showed up just in time like a rescue buoy. However, domestic rice market was still muted after the country won the 750,000-ton contract of Philippines, of which Vietnam supplies 450,000 tons and the rest is from Thailand, because the buyer only needed 250,000 tons of rice to be delivered by the end of 2015. Until Vinafood 2 signed a contract to export 1 million tons of rice to Indonesia, the market became vibrant then rice prices increased swiftly. Among 1.4 million tons of rice inventory at that time, Vinafood 2 accounted 400,000 tons. Big contract from Indonesia has helped businesses to solve earlier long-lasting difficulties and revive rice exporters.

According to VFA, export of rice in early 2016 meets more favorable conditions than that in the same period last year. Rice inventory in 2015 was at 300,000 tons, much lower than an average inventory of 700,000 tons of rice in previous years. Rice export contracts passed from 2015 was at about 1.3 million tons while import demand from large market was also earlier. Thus, in the 2015-2016 winter-spring crop, businesses probably will not have to buy rice for temporary stockpile as they did in the 2014-2015 winter-spring crop. VFA also forecast that, rice export market will be good until the end of second quarter of this year as large importers, such as: Philippines, China, Indonesia, and Malaysia will sign import contracts soon in order to stabilize domestic food supply and cope with drought caused by El Nino. These countries will still be potential markets for Vietnamese rice in the next several years, especially China.

According to Reuters, the Philippines’ National Food Association recently announced that the country is set to buy 400,000 tons of rice for delivery in the second quarter, and may need an additional 800,000 tons to cover this year’s requirements. Although Philippines and Indonesia always seek to supply food on their own, natural disasters, including storms, floods, and especially long-lasting El Nino phenomenon, has caused the most serious impacts in the past 60 years.

However, it raised concern as local rice price is higher than global rice price. As for 5-percent-broken rice, sometime Vietnamese rice was US$10-20 per ton higher than Thai and Indian ones and $60 per ton higher than Pakistani one. This makes rice exporters flinch when signing commercial contracts. Although domestic rice price has declined by $5-10 per ton, it is still at high level. Therefore, if this situation prolongs, it will be difficult for businesses to sign export contracts.

Nguyen Van Tien, CEO of Angimex, said that the fact that fragrant and white rice continued to post growth in 2015 is positive signal and favorable condition to build brand name for Vietnamese rice. There are many factors that help global rice price to recover, such as: negative effects of El Nino on food production, declining global food inventory as it was in the years prior 2007-2008, the period of food crisis. The matter of controlling pesticide residues should be resolved so as to when the Trans-Pacific Partnership (TTP) becomes effective, Vietnam will not lose its advantages when entering demanding markets in the TTP and even on its home ground.

At present, rice export contracts passed from last year are more than 1.3 million tons while winter-spring rice crop production is about 4.3 million tons, which means that around 3 million tons of rice is waiting for export contracts.

Vietnam Rubber Group to equitize in 2016

The Vietnam Rubber Group (VRG) will equitize its parent company and subsidiaries Phu Rieng, Binh Long and Loc Ninh rubber companies this year.

According to the group, rubber industry will continue facing difficulties in consumption this year.

Therefore, it will work to reduce investment domestically, lower cost prices, divest from businesses outside the rubber industry, speed up equitization and intensify care to improve rubber trees’ quality.

The group will plant only 2,000 new rubber hectares and clear old and low productivity areas.

Besides VRG will take the imitative in working with rubber product manufacturers such as mattress and glove makers to consume its materials and study domestic tire production.

Da Nang allows foreign cruises to keep casinos open

The central city of Da Nang will become the first locality in Vietnam to allow international cruise ships to keep open their casinos and duty-free shops starting in mid-January.

Deputy Director of the city Department of Culture, Sports and Tourism, Tran Chi Cuong, said his department has consulted with city authorities and pored over the country's laws before making the decision.

"We have looked into all relevant regulations and found there are no provisions banning foreign ships from offering the services on board to their passengers while anchored in Vietnamese waters.

"Therefore, such services should be allowed for cruise tourists to help attract more international cruise ships to the country."

With tourist destinations in the country yet to provide such facilities, those on board cruise ships would help entertain cruise visitors, he added.

SuperStar Libra, operated by Star Cruises, is expected to become the first cruise ship to benefit from the city's move. Tourists aboard the vessel stay overnight in Da Nang rather than make a day trip.

For the past couple of years representatives of foreign cruise lines have been repeatedly asking the Ministry of Culture, Sports and Tourism, the Vietnam National Administration of Tourism, and provincial authorities to allow them to keep casinos, bars, and souvenir shops open on board their cruise ships.

The representatives said these are sorely needed since many passengers do not want to disembark and go on local tours. The services also provide an additional source of income for the cruise lines while local authorities do not need to worry about local residents getting on board to gamble.

Vietnamese nationals who are not passengers are not permitted to board the vessels or enter the casinos, they said.

In preparation for a plan to organise hundreds of cruise voyages to Vietnam in 2015-17, executives of Star Cruises have met officials of VNAT, Quang Ninh province, and Da Nang and sought sanction to keep the casinos and duty-free shops on board their vessels open.

But no other locality apart from Da Nang has agreed though.

Cuong said last year Da Nang welcomed around 1.27 million foreign visitors, with passengers arriving by international flights making up a majority of the number.

Da Nang saw more international services started last year from Japan, Malaysia, and Hong Kong, taking to 20 the number of scheduled and chartered international routes.

The department has high hopes that more international travellers will visit Da Nang this year, especially aboard cruise vessels.

"Star Cruises alone will bring to the city around 110 cruise ships this year with thousands of passengers and crew on board each," Cuong said.

Taiwanese company invests over US$10 billion in Vung Ang EZ

Formosa Hung Nghiep Ha Tinh Steel Company (FHS) belonging to Taiwanese Formosa Group said it had invested over US$10 billion in the first phase of the steel complex and Son Duong Formosa deep seaport project at Vung Ang Economic Zone, Ky Anh district, the north central province of Ha Tinh.

The project which broke ground in July 2008 is speeding up progress.

By the end of last year, FHS’s steel rolling mill put its blast-furnace No.1 into operation with the capacity of 350,000 tons a year.

The first hot rolled steel batch came out of oven successfully on December 25, marking the debut of this product, the most important item of the steel industry, in Vietnam.

Previously, the fist heat engine of Formosa thermal power plant with the total capacity of 650MW started operation supplying and selling electricity to FHS Company and Vietnam Electricity on September 17.

The company is now building 11 wharfs that can receive vessels of 50,000-200,000 tons. Their capacity will reach 28 million tons of cargo a year in the first phase.

The second phase will permit vessels of 300,000-500,000 to dock at and lift the capacity to 84 million tons a year, making the wharf group the first or second largest port in Southeast Asia.

Hotel sector sees improvement

Vietnam's luxury hotel sector is undergoing strong growth, with several projects under construction adding thousands of rooms to the market, notably at the resort development of Phu Quoc.

In the past few months, work began on the five-star hotel Crowne Plaza Phu Quoc and the four-star Novotel Phu Quoc Resort. In 2010, Phu Quoc only had 1,000 hotel rooms. The had number tripled by the end of 2015.

In November 2015, the US-based Carlson Rezidor Hotel Group signed on a contract to develop Raddision Blu Cam Ranh hotel project in Nha Trang, which will be opened in 2019. Nha Trang City also witnessed the development of various luxury hotel projects.

The General Statistic Office said the number of international tourists reached 732,740 in November, up 12.9 percent on previous month and 20.4 percent on a year earlier.

Property company Savills Vietnam said occupancy rate growth in luxury hotels in Hanoi and HCM City are 15 percent and 7 percent per quarter, respectively.

Eight provinces, cities asked to supply E5 bio-fuel

Hanoi, Hai Phong, Da Nang, Quang Nam, Quang Ngai, Can Tho, Ba Ria-Vung Tau and Ho Chi Minh City have been requested to supply E5 bio-fuel to vehicles by June 1 in replacement of RON 92 petrol.

The request was included in the Government Office’s notice on Deputy Prime Minister Hoang Trung Hai’s decision at a meeting summing up the production and trade of the bio fuel and regulating its price mechanism.

Deputy PM Hai requested other centrally-governed cities and provinces to have the bio fuel sold at a minimum of 50% of their retail fuel stations and half of the current RON 92 consumption to be replaced by the bio fuel by June 1.

Efforts made by relevant ministries, agencies and localities to promote the fuel’s usage were highlighted and they were asked to continue implementing assigned tasks in PM Nguyen Tan Dung’s decision on using the bio fuel to replace traditional fuels.

The Ministry of Industry and Trade (MOIT) was asked to work with relevant agencies and localities to promote communication to encourage people to use the bio fuel while urging petroleum businesses to realise the set target in increasing the number of their retail fuel stations selling E5 bio-fuel and to report the results to the PM.

The Ministry of Finance was assigned to work with the MOIT to develop an approach to calculate the bio fuel’s base price to ensure effectiveness of the distributors and complete the work in January while considering a 5% value-added tax to E5 and E10 fuels to encourage the usage and reporting to the PM.

E5 is a mixture of 95 per cent petrol and 5 per cent bio-ethanol, produced mostly from corn and cassava.

ATIGA to remove tariffs in ASEAN by 2018

Viet Nam has signed nearly 10 free trade agreements (FTAs) bilaterally and multilaterally at different levels, notably a pact to become a member of the ASEAN Economic Community (AEC) from December 31, 2015 and the ASEAN Trade in Goods Agreement (ATIGA) to remove tariffs among the member countries by 2018.

ATIGA, the first comprehensive agreement of ASEAN to monitor all commercial activities of the block, was built on the basis of the Common Effective Preferential Tariff (CEPT),the ASEAN free trade agreement (AFTA) and other related agreements and protocols.

Accordingly, the ASEAN member countries will grant priorities to each other equal or higher than those to partners in FTAs in which the block has participated in. Tariffs on most of goods were removed in 2015 and 7% of them will be flexible until 2018. Several agricultural products of Viet Nam are allowed to keep a 5% tariff after 2018.

Implementing ATIGA, by the end of 2014 Viet Nam cut 6,859 types of tax, equivalent to 72% of the import-export tariff and 1,720 tariffs were down to zero in 2015.

The 687 remaining tariffs, mainly related to sensitive products in Viet Nam-ASEAN trade, will be removed by 2018.

Viet Nam mainly exports to the ASEAN member countries rice; crude oil; steel; mobile phones and components; machine, equipment, tools and spare parts; petroleum and gasoline; computers, electronic products and components.

Viet Nam’s imports from the region include fundamental products; materials for local production; computers, electronic products and components; machines, equipment, tools and spare parts; and material plastic.

Nation’s largest cow farming project on stream

A VND4.58 trillion high-tech cow farming project was inaugurated in the north-central province of Ha Tinh last Friday, becoming the largest such undertaking in the country.

The Bank for Investment and Development of Vietnam (BIDV) has pledged loans totaling around VND3.17 trillion for Binh Ha Joint Stock Co. to carry out the project intended to produce breeder cows and beef.

Of the amount, long-term loans will be VND2.2 trillion and short-term loans for cow import in phases one and two VND970 billion.

BIDV has already disbursed VND810 billion including VND492 billion in long-term loans for project construction and VND318 billion in short-term loans for cow import, veterinary medicine and feed.

Covering 5,000 hectares of land in Cam Xuyen and Ky Anh districts in Ha Tinh, the project will be able to raise 254,200 cows per year.

The project uses high tech for farming breeder cows and producing high quality beef for domestic consumption and export. The project can employ 3,000 local workers.

Binh Ha has completed the first phase of the project with 55 cowsheds built and 30,000 cows imported. The project has 300 hectares of grass and 80 hectares of corn.

The company has completed construction of six feed warehouses, three fermenting stations, two electronic weigh stations, and two fuel stations. The whole project is planned to be ready this year.

Binh Ha, a joint venture between Hoang Anh Gia Lai Group and An Phu Group, specializes in high-tech agriculture like buffalo and cattle breeding.

At a seminar on cow farming last Friday, Tran Bac Ha, chairman of BIDV, said BIDV would set aside VND1 trillion to lend to high-tech cow cultivation projects.

The bank will prioritize lending to high-tech research in the industry, supporting policymaking in provinces with high cow farming potential, recommending investment projects for local businesses, and funding workable cow breeding projects, the bank’s chairman said.

The bank will initially make VND1 trillion loans available for technological innovation projects and those for expanding the cow farming industry.

Cow farming projects for meat with 200 to 500 head, dairy farming projects with 500 head, and high-tech cow raising projects are on the priority list of the bank.

Ha said the bank is also ready to support firms in trade promotions abroad.

HCMC tourism faces challenges from ASEAN Community

Management agencies and travel firms in HCMC have expressed concern over challenges posed by the ASEAN Community for the city’s tourism sector.

La Quoc Khanh, deputy director of the HCMC Department of Tourism, told a meeting on January 14 on the sector’s operation in 2015 that international arrivals in HCMC reached 4.6 million last year, up 4.6% from a year earlier. But the city attracted fewer visitors from the ASEAN and Northeast Asian countries.

The decline was worrying as more Japanese tourists had picked ASEAN for their holidays, but the number of Japanese visitors to HCMC slid.     

Tourist arrivals from other ASEAN nations such as Laos and Thailand fell too. Particularly, visitors from Cambodia, an important market of HCMC, dropped sharply.

“International visitors to HCMC grew last year but growth has slowed over the past four years. The ASEAN Community was in place at the end of 2015 and may pose more challenges to our tourism industry,” Khanh said.

Khanh said the tourism department will organize a host of activities in Asian markets to promote the city’s tourism products, especially ASEAN, Japan and South Korea.

Travel firms said the ASEAN Community will enable the tourism sector to lure a bigger number of travelers but the sector is now facing a slew of difficulties in terms of manpower, product diversification and competitiveness. Prices of products quoted by local travel firms are higher than in regional nations.

Therefore, local travel firms said they need support of authorities and business associations to reduce prices.

Lai Minh Duy, director of TST Tourist Company, suggested the tourism department coordinate with the HCMC Tourism Association to hold regular meetings on human resource development for the city and neighboring provinces. At present, training activities abound but have yet to meet demand of travel enterprises.

Duy said companies need assistance to design and develop appropriate products for the ASEAN markets to compete with regional rivals.

Data of the HCMC Department of Tourism showed apart from 4.6 million international visitors, the city served 19.3 million domestic tourists in 2015, a rise of 13% year-on-year.

Total revenue of the tourism sector amounted to VND94.6 trillion (US$4.2 billion) last year, up 10% versus 2014.

HCMC looks to welcome around five million international visitors and 21.8 million domestic travelers this year.

Agencies join hands to shorten goods clearance at port

Six agencies and entities are coordinating to form a special checkpoint at Cat Lai Port in HCMC to help import and export firms save time for customs clearance.

They are the Institute of Public Health, Veterinary Center for Region 6, Phytosanitary Center for Region 2, Quality Assurance and Testing Center 3 (Quatest 3), HCMC Vinacontrol Co, and the control center for animal and animal feed. They opened offices at the port on January 14.

Dinh Ngoc Thang, deputy director of the HCMC Department of Customs, said the establishment of the office would help reduce customs clearance for cargo by two to three days and 20-30% of storage fees.

Data on the department’s portal will be shared and used by the agencies for cargo clearance at the port. However, some kinds of cargo are still subject to thorough checks.

Currently, the volume of cargo subject to inspections conducted by more than one agency accounts for 34% of declaration forms and 30% of goods value.

A second special checkpoint will come on stream at Tan Son Nhat airport on January 15 to facilitate customs clearance at the biggest international airport in Vietnam.

Nguyen Ngoc Tuc, head of the General Department of Customs, said some special checkpoints

will be activated in the northern provinces of Lao Cai and Quang Ninh to bring the number of localities having such checkpoints to seven.

The seven localities are Haiphong, Hanoi, Danang, HCMC, Lao Cai, Quang Ninh and Lang Son.

FMP to operate emergency coordination center

Family Medical Practice (FMP) has announced a plan to open a private emergency coordination center in Vietnam in the middle of this year, which will operate 24/7 via a switchboard *9999.

As part of preparations for the first private emergency coordination center in Vietnam, a training course has been organized for Vietnamese coordinators. On Tuesday, FMP awarded certificates to eight coordinators for the emergency switchboard.

They completed a four-month training course under the guidance of experts from the International Academies of Emergency Dispatch (IAED).

When receiving emergency calls, coordinators will get basic information about patients like their situation and location before guiding the person who makes the emergency call to provide first aid for patients before an ambulance arrives.

FMP will have well-equipped ambulances and doctors for the emergency coordination center.

Dr. Rafi Kot, CEO of FMP Vietnam, expects the emergency coordination center will receive around 50 emergency calls a day when it is in place in the next four months.

Ron McDaniel, vice president of U.S. emergency coordination technology firm Priority Dispatch, said emergency coordination plays an important role in reducing risks for patients.

The service will make Vietnam appear in the list of 53 nations cooperating with IAED.

FMP has established a presence in Hanoi, Danang and HCMC.

Ministry unveils plan to realize budget collection target

The Ministry of Finance will increase budget collections from domestic sources as a measure to achieve the State budget revenue target amid the world oil price plunge and falling import tax revenue.  

The ministry said the decline of oil prices left heavy impact on the State budget last year as crude oil averaged out at US$55 per barrel, much lower than the targeted price of US$100 per barrel as reported to the National Assembly (NA) earlier that year, the Vietnam News Agency reports.

However, the ministry said last year’s State budget collections were still realized thanks to the oil price scenarios the ministry drew up and proposed measures to the Prime Minister to manage the 2015 State budget spending.

The ministry quickly implemented a number of revised laws approved by the NA to hike domestic collections to cushion the impact of lower revenues from oil export and import-export taxes.

The ministry streamlined administrative procedures in the tax and customs sectors to help the country attract more domestic and foreign investments, resulting in more State budget revenues.

The ministry also coordinated with provinces to inspect tax payments and arrears. As a result, nearly VND40 trillion in tax arrears had been collected by the end of 2015.  

Minister of Finance Dinh Tien Dung said regular spending and consumer prices have been monitored, especially amid the global oil price drop. The ministry joined hands with provinces to cut production costs to fuel growth.

By the end of 2015, State budget collections had exceeded the NA’s approval by 8% and VND10 trillion raised from the equitization of State-owned enterprises (SOEs) had not been used to finance a budget deficit caused by the oil price fall, Dung said.

This year, financial and foreign exchange developments, global oil price movements and Vietnam’s deeper international integration will continue impacting State budget collections.    

The world oil price is estimated at US$60 per barrel for this year but the price has sunk below US$35 per barrel. Under Vietnam’s commitments to free trade agreements (FTAs), its budget collections will drop by VND10 billion in 2016 due to tariff reductions and exemptions.    

The fall will affect the State budget this year. Therefore, the finance ministry worked out oil price scenarios of US$30-55 per barrel to better manage State budget collections.

Dung said policies to cut spending, improve budget collections and prevent losses will be adopted.   

Regarding management of domestic fuel prices, the ministry said prices were adjusted in line with developments on the world market, with 18 rounds of fuel price cuts last year. However, many bemoaned the world crude oil price dipped over 40% while the retail price of gasoline went down just 10%.     

Dung cited data of the General Statistics Office as saying that the average fuel price edged 24.7% lower last year. He said the crude oil price and the retail price of gasoline are different as the latter includes other costs for production, storage and transport.    

Fuel retail prices were revised in tandem with movements of global oil markets, Dung said, adding fuel prices in Vietnam are lower than in other regional countries like China, Laos and Cambodia.

He said the ministry will manage fuel prices in line with the Government’s Decree 83/2014/ND-CP on oil and gas business. He said the management will be made transparent and that inspections of fuel prices will be tightened as per the prevailing regulations.

EVN obtains profit from capital divestments

Vietnam Electricity Group (EVN) earned profit of VND35 billion (US$1.5 million) after its withdrawal of nearly VND2 trillion from non-core business operations in 2012-2015.

According to a restructuring scheme in the 2012-2015 period, EVN had to divest capital and reduce its ownership in joint stock companies in non-core business areas.

Dinh Quang Tri, deputy general director of EVN, told a review conference in Hanoi last week that EVN had completed capital divestments from and lowered its holdings in companies operating in real estate, finance, banking, insurance and securities.

By the end of 2015, EVN had pulled capital out of Vietnam Electricity Investment and Construction JSC (EVNIC), Saigon Vina Real Estate JSC, Central Power Real Estate JSC, An Binh Securities Company (ABS), An Binh Commercial Bank (ABBank) and Global Insurance Company (GIC).

EVN said it had divested capital from non-core business areas by transferring shares or holding auctions to sell shares to other investors with share prices equivalent to or higher than the face value.

The VND35 billion profit was modest compared to the State-owned enterprise’s financial targets but would provide extra funding for EVN to implement its projects in its core business fields of electricity production and trading.

EVN reported electricity sales of more than VND233.7 trillion (US$10.4 billion) last year, increasing 18.5% versus 2014.

Thaco posts 2015 auto sales growth of 90%

Truong Hai Auto Joint Stock Company (Thaco) became the biggest domestic auto seller last year with 80,421 units sold, soaring 90% from a year earlier.

The impressive sales increase surpassed the target of over 70,000 autos Thaco set at its shareholder meeting last May. The target was deemed as too ambitious at the time as Thaco’s total sales volume was only 42,300 units in 2014 and Toyota Vietnam, one of the auto firms in Vietnam, then aimed for 46,000 units in 2015, up 13% year-on-year.

Thaco saw 2015 sales of Kia, Mazda and Peugeot brands growing by 100% over 2014 to 42,213 units including 21,310 Kia, 20,359 Mazda and 544 Peugeot cars.

Despite the impact of a higher special consumption tax from January 1, Thaco said it had kept prices unchanged and at the same time offered promotions for buyers of Kia, Mazda and Peugeot autos.

Customers can enjoy special prices, plus one-year material insurance and accessory kits, when they buy cars of the three brands this month.

Bui Kim Kha, deputy general director of Thaco, told the Daily earlier that as calculated by Thaco if the new special consumption tax calculation method was applied, car prices would inch up 2-5%.

Quarantine to facilitate farm produce exports: deputy minister

Deputy Minister of Agriculture and Rural Development Le Quoc Doanh said that quarantine works this year will aim at creating transparent and better conditions for businesses to boost fruit and vegetable exports, besides preventing diseases in farming production.

He made the statement at a conference hosted in Hanoi yesterday.

At the event, the Plant Protection Department under the ministry said last year a landmark in Vietnamese fruit export as it started penetrating into strict markets in the world.

So far, Vietnam has exported over three tons of Thieu litchi and over 100 tons of longan to U.S. market, over 1,200 tons of dragon fruits and 10 tons of mango to Japan.

Australia has officially opened its door for Vietnamese fresh litchi, a total of 16 consignments with 28 tons have been shipped to the country as of now.

The Ministry of Agriculture and Rural Development said that fruit export hit the record turnover of US$1.83 billion last year, up 23.4 percent over 2014.

Many types of fruit specialties, vegetables and other high-quality farm produce will continue conquering new markets this year, it said.

BIDV sees impressive 2015

The Bank for Investment and Development of Vietnam has released its 2015 business results and noted two major achievements: reaching its targets and merging with the Mekong Housing Bank (MHB).

Total assets were more than VND857 trillion ($38.23 billion), an increase of 25 per cent against 2014, charter capital was VND34 trillion ($1.51 billion), total outstanding credit and investment VND799 trillion ($35.64 billion), an increase of 22 per cent, non-performing loans were cut to 1.71 per cent of the total, and retail credit increased 44 per cent, accounting for 22.7 per cent of total credit in 2015.

Total mobilized capital stood at almost VND793 trillion ($35.37 billion), 26 per cent higher, and profit before tax from commercial banking activities was VND7.03 trillion ($313.60 million), an increase of 16 per cent against 2014, while its ROE reached 15 per cent and ROA 0.76 per cent.

Chairman Tran Bac Ha described the results as impressive in all aspects. BIDV also created coordination units with over 1,700 financial institutions in more than 122 countries around the world, and had an official presence in Laos, Cambodia, Myanmar, the Czech Republic, Russia, and Taiwan. It also began 13 connectivity programs to prepare for deeper international integration due to the AEC and the FTAs Vietnam has signed, and been seeking opportunities in Northeast Asia.  

In its 2016 plans it has targeted credit growth of 20 per cent, in which retail services growth will increase 35 per cent, bad debts to be kept lower than 3 per cent and efforts made to keep them lower than 2 per cent, mobilized capital to increase 21-22 per cent, and revenue from services to increase 20 per cent.

HCMC office occupancy best in 4 years

Average occupancy in Ho Chi Minh City’s office market recorded its best performance in four years in the fourth quarter of 2015, according to the latest report from Savills on the city’s real estate market, released on January 12.

The report put average occupancy at 94 per cent, stable quarter-on-quarter and up 4 ppts year-on-year due to strong year-on-year occupancy increases in all Grades, by 3 to 4 ppts.

Approximately 57,000 sq m from two Grade B and four Grade C projects entered the market. Total stock increased 4 per cent quarter-on-quarter and 8 per cent year-on-year.

Average rents were up 3 per cent year-on-year. Grade B and C rents both increased 1 per cent quarter-on-quarter and 1 per cent year-on-year. Total take-up was 60,000 sq m, an increase of 264 per cent year-on-year, in which Grade B’s share was 65 per cent.

GDP and FDI increasing in Ho Chi Minh City along with the effect of the revised real estate law and trade agreements are said to be among the factors behind the increase in office demand.

In 2015 Ho Chi Minh City ranked second in attracting FDI, with total newly-registered capital and additional capital of $3.32 billion, accounting for 14.6 per cent of the total in the country. With free trade agreements to take effect in the future and the establishment of ASEAN Economic Community, the city’s office market is expected to soar in the time to come.

PVN asked to expand exploration and exploitation in 2016

Deputy Prime Minister Hoang Trung Hai requested the National Oil and Gas Group (PVN) to continues concentrate on search, exploration and exploitation of oil and gas in 2016, saying that this is a key task of the sector in 2016.

Speaking at a conference in Hanoi on January 9, the Deputy PM praised the group for its achievements during the last five years, he suggested that an even greater future effort will bear fruit.

He said PVN also needs to keep a close watch on market developments to give a reasonable forecast of oil prices for 2016, and following years, adding that the group should pay attention on cutting expense to optimise its operation.

PVN was also advised to focus on expanding scientific and technological applications, and fully tapping its high-quality workforce.

Deputy PM Hai asked PVN’s subsidiaries to make concrete plans for the group’s business management, and those to improve the qualifications of its staff.

PVN’s General Director Nguyen Quoc Khanh reported that the group still earned 560.1 trillion VND (around 25.2 billion USD) in revenue in 2015 in spite of falling oil prices, representing a rise of 4 percent against the set target, and 2.4 times higher than those in 2006-2010.

The group contributed 115.1 trillion VND (5.18 billion USD) to the State budget this year, up 19.8 percent against the year’s target.

PVN also fulfilled its plan to increase reserves for the two whole months ahead of schedule , reaching 40.5 million tonnes of oil equivalent, 8 percent higher than the yearly target.

Its exploitation output reached 29.42 million tonnes, exceeding 10.6 percent of the plan set by the Government. Of the number, crude oil reached 18.75 million tonnes, while gas exploitation hit 10.67 billion cu.m, respectively up 11.6 percent and 9 percent against its yearly plan.

Petrol, electricity and nitrogen production also recorded high growth, exceeding the set plan from 10-24 percent.

Khanh stated PVN will continue accelerating its restructuring and divestment’s capital, while increasing investment for its key business and production projects in 2016.

It will also expand coordination with relevant agencies in exploring and developing in deep water and offshore areas, he said.

Vietnamese companies perform well in Laos

Vietnamese businesses have performed well in Laos and contributed to local economic growth over the last five years despite the lingering impact of the global economic crisis, said a report delivered at a congress of the Vietnam Business Association in Laos.

The second congress in Vientiane on January 8, was attended by almost 100 representatives of Vietnamese companies doing business in Laos, Vietnamese Deputy Foreign Minister Vu Hong Nam – Chairman of the State Commission on Overseas Vietnamese Affairs, and Vietnamese Ambassador to Laos Nguyen Manh Hung.

In his speech, Laos Deputy Prime Minister Somsavad Lengsavath, who chairs the Laos – Vietnam cooperation sub-committee, said his country’s over 7 percent economic growth in recent years was largely contributed by Vietnamese enterprises.

He thanked the Vietnamese Government and companies for supporting Laos, adding that Vietnamese firms have also helped reinforce the special solidarity between the two countries.

As the two neighbours have become members of the recently-founded ASEAN Economic Community, their enterprises should enhance cooperation to optimise their advantages, minimise unwanted impacts, and fuel their countries’ economic growth, he added.

The official asked the association to continue acting as a bridge tightening the two business circles’ partnership and boosting their competitiveness.

At the congress, Deputy Foreign Minister Nam and Ambassador Hung said they hope the association will promote its performance in the 2016 – 2020 tenure to expand the Laos-based companies’ development, thus helping with the intensification of the countries’ special solidarity and all-faceted cooperation.

IT important to improve worker competitiveness

Vietnamese firms should apply information and technology (IT) to improve labour productivity and competitiveness, Nguyen Truong Thang, Director of the Institute of Information Technology, Vietnamese Academy of Science and Technology, said.

The country's IT infrastructure was cheap and competitive, which facilitated enterprises, Thang said at a meeting in Hanoi on January 7.

The national IT infrastructure also had stable transmission lines and prices, he added.

Meanwhile, Le Van Loi, Director of the Vietnam Chamber of Commerce and Industry (VCCI)'s Institute of Information Technology for Business, recommended that firms boost IT applications as it would help them work faster and have better services in the context of integration.

Secondly, he said that if firms did not apply IT, their work would be less effective.

Thirdly, IT would help firms satisfy customers if they created fan pages on Facebook or Twitter.

"Customer satisfaction is very important in business," he emphasised. "For enterprises which have hundreds of thousand customers, only technology can help them stay in contact with their customers."

An attendee at the meeting also shared a story about IT applications in customer care services.

She said her friend in the United States bought medicine and then received messages about the medicine's usage and notification on her mobile phone and Twitter to remind her to take the medicines regularly.

"When she had completed the dosage, she received an offer to buy a new one with preferential pricing, and now she has become a friendly customer of the pharmaceutical company," she said.

Technology can help businesses manage and take care of millions of customers automatically, while a customer care staffer can only take care of about 50 customers per day, she said.

Over ten years, information technology has become a key economic sector with a high growth rate and efficiency, Doan Duy Khuong, VCCI Vice Chairman said.

The sector has contributed nearly 7 percent of gross domestic product (GDP) of the country, as well as boosting development of the socio-economy sector, Khuong added.

The Vice Chairman said that many Vietnamese enterprises had actively invested and applied IT in their administration, production and trading activities.

However, most of Vietnamese enterprises were still not fully aware of the role of IT, and therefore, were still struggling to find IT models suitable for their financial capacity and business purposes, Khuong added.

"VCCI will co-operate with agencies, research institutes, and technology groups in the future as well as increase international co-operation and social resources for the purpose of developing businesses," Khuong said.

VCCI would also support the business community in Vietnam, especially small – and medium-sized enterprises by consulting with businesses in advanced technology applications to improve competitiveness and increase labour productivity, he stated.

Toyota recalls Corolla Altis, Vios, Yaris for faulty power window master switch

Toyota Motor Vietnam Co., Ltd. (TMV) on January 8 announced the start of a recall campaign for the power window master switch on 19,616 vehicles at all Toyota dealers nation-wide.

According to the announcement, TMV will carry out checking, repairing and free replacing (if necessary) the power window master switch of 12,611 units of Corolla Altis and 7,002 Vios assembled in Vietnam and 3 imported Yaris starting January 8.

The Corolla Altis, Vios and Yaris have respective production period of between January 5, 2009 and December 31, 2010, between January 5, 2009 and October 31, 2009 and between September 1, 2009 and July 1, 2010.

The power window master switch in the involved vehicles may have been manufactured with insufficient lubricant grease. If not enough grease is applied, under certain conditions the switch may develop a short circuit that can cause the switch assembly to overheat and melt. A melting switch can produce smoke and potentially lead to a fire.

The replacement will take between 30 minutes to one hour for each car; however, the exact duration much depends on the plans of each dealer. Customers who own affected vehicles will receive a letter of notice of the recall campaign and invited to bring their vehicles to TMV’s dealers for free checking and replacing (if necessary).

Other models produced and distributed by TMV will not affected by this campaign.

For more information about this campaign as well as to check whether their vehicles are affected or not, customers can find the affected range of number on TMV’s website www.toyotavn.com.vn. or contact any Toyota dealers.

To save time, contacting and making an appointment in advance with Toyota dealers or Toyota Authorised Service Stations is preferable. If having any inquiries, customers can contact the dealers where they bought their cars or call TMV’s hotline: 18001524.

Ho Chi Minh City to force cash-rich Uber to pay tax: official

With Uber consistently refusing to declare and pay taxes for their operations in Ho Chi Minh City, the municipal tax department will force the ride-sharing service provider to do so, an official said Friday.

Uber also faces possible fines for the late tax declaration and payment, a representative of the city’s tax department told Tuoi Tre(Youth) newspaper.

The city’s taxman has admitted that it is not easy to oversee Uber for tax issues, as it operates on mobile devices and mostly receives payment via cards.

Uber currently has some 4,000 cars in the southern metropolis, with its business overseen by its parent firm in the Netherlands, Uber B.V., according to the city’s transport department.

The Vietnamese unit of Uber, in the meantime, only registers as a marketing firm for the car-grabbing service.

Uber has therefore only paid taxes for the marketing fees it receives from the Amsterdam-based Uber B.V., the tax official said.

The parent firm pays Uber Vietnam to take care of such tasks as customer management and Q&A, he added.

“The whole transportation activity is managed by Uber in the Netherlands,” he said.

According to the transport department, Uber wires around VND1 billion (US$44,643) worth of profit, which is only about 20 percent of the revenue Uber generates in Ho Chi Minh City, to its parent on a daily basis.

The Ho Chi Minh City taxman has repeatedly sent documents to ask Uber to fulfill their taxpaying duty, but they would never reply, according to the tax official.

The tax department admitted that Ho Chi Minh City is not the first foreign market Uber has entered, so the company has many experience in business organization and tax issues.

“However, we have told Uber that companies have to pay tax for their operations in Vietnam, no matter what kind of business it is,” the official told Tuoi Tre.

The official said the tax department is willing to support Uber to resolve any problems it may have in completing the tax procedures.

“But if the company remains silent, we will take the next step to force them to pay taxes,” he asserted.

“They will also have to pay fees and fines as per the law.”

Even though it is hugely supported by local riders, the Uber operation in Vietnam remains a headache for regulatory bodies as they are confused about how to treat the company in a legal manner.

In Ho Chi Minh City, many departments and agencies have said Uber is going against the law, and they are consulting the transport department on how to report the issue to the municipal administration.

Meanwhile, it is obvious that the city’s taxi sector is not happy to see Uber cars ‘stealing’ their customers.

The Ho Chi Minh City Taxi Association has maintained that Uber is breaching the rule and creating unhealthy competition with local cab operators.

The inspectorate under the city’s transport department has so far booked some 200 Uber cars for not having a license to operate as a taxi, as well as failing to display the required badges and signs.

Uber has been present in Vietnam since June 2014, currently operating only in Hanoi and Ho Chi Minh City. Riders have to book a ride via the Uber app, with the complete fare automatically billed to their credit cards at the end of a ride.

In August 2015, the service began accepting cash as cashless payment is not widely common in the Southeast Asian country.

Big-wig dairy producers narrowly escape $45.87 million toll

A group of domestic dairy producers that hold massive shares in the Vietnamese milk market will likely be set free of a tax arrear toll of nearly $45.87 million.

In a document recently sent to the prime ,inister, the Ministry of Finance (MoF) stated that it would revoke the subordinate General Department of Customs (GDT)’s decision of collecting the tax sum from eight milk manufacturers. GDT’s move aimed to recover the import tax sum that had not yet been collected.

Including big names, such as Vinamilk, Nutifood, Friesland, and Hanoi Milk, the group submitted a proposal to the prime ,minister in December 2015, requesting the termination of GDT’s decision.

In their proposal, dairy producers argued that a heavy toll around VND1 trillion ($45.87 million), would inevitably find its way to weigh on consumers by means of higher sales prices for many products.

“Dairy products for children aged 1-6 years are currently the main output of the dairy industry. These are products that the government has already expressed concerns over, regarding the continuous rise in prices,” the document stated.

The consequences may be even more serious if the new classification of ‘imported material’ was applicable from now on, the document added.

Importing goods since 2000, these firms claimed that they have always classified their goods as Anhydrous Butterfat (ABF), coded 0405.90.10, and subject to an import tax tariff of 5 per cent. However, in 2014, the customs determined that some containers declared as such contained in fact Anhydrous Milk Fat (AMF), coded 0405.90.90, and subject to a threefold tax level of 15 per cent.

Under the existing Law on Customs, a toll can be imposed in cases where customs authorities investigate violations within a time period of five years after customs were declared. Thus, the GDT decided to review and collect tax arrears since 2010 until present.

Besides withdrawing the tax arrear toll, the MoF also plans to adjust the import tariff level of AMF, recognising that the current 15 per cent is too high and could hinder the local manufacturing of many milk-extracted products. The ministry, therefore, lowered the import tariff to only 5 per cent, equal to that imposed on ABF.

HOSE reaches nearly $51 billion in capital market in Q4

The HCM Stock Exchange (HOSE) reached VND1,147 trillion ($51 billion) of capital market in Q4, according to the exchange conference on January 7.

It was the first year that the exchange had a capital market over VND1,000 trillion $ (44.4billion) in all four quarters.

The Q4's capitalisation has increased by 12.7 per cent compared with Q1 and 16.4 per cent compared with its same term of 2014.

A conference official said that with the exception of VN30, which tracks 30 stocks with the largest capitalisation, experiencing a slight decrease of 0.7 per cent, all the others saw growth.

The VNMID, tracking mid-cap stocks by the end of 2015, reached 739.87 points, an increase of 18 per cent over the beginning of 2015, adding that it demonstrated the potential development of the local average capitalisation enterprises last year.

Currently, HOSE has 347 securities with more than 42.6 billion listed shares, or VND434 trillion ($19 billion) in value. In the same year, 19 new companies listed on the exchange with volume reaching 2.2 billion shares, while there were 175 additional listings for another 7.78 billion shares.

In 2015, the exchange said, domestic transactions still accounted for over 78 per cent of the trading in the market. Foreign investors, including individual and organisation investors, bought over VND4.2 trillion ($186.6 million) or about 1 per cent of total market transactions.

Viet Nam Securities Depository said in 2015 that it certified stock trading codes to 745 individual foreign investors, an increase of 42.7 per cent over 2014, adding that it was the year with the largest foreign investors in the last five years.

Le Hai Tra, HOSE's deputy director, said a group of individual investors from Thailand said that Viet Nam was a stock market that could not be ignored.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR