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Chief finance officers share information
More than 200 local and foreign chief financial officers (CFOs) gathered here yesterday for a seminar on their role during fiscal turbulence.
The seminar promoted the sharing of information on corporate finance, integration into the international financial community and harmonising financial and accounting standards.
Participants also discussed the global accreditation system by the International Association of Financial Executives.
Nguyen Ngoc Bach, director of the CFO Viet Nam Club, said the global economy was gaining momentum, but financial turbulence still posed threats.
He said the seminar offered an opportunity for CFOs and corporate leaders to develop measures to minimise risks in business operations.
Bach said the implementation of the association's global accreditation and finance and accounting standards in Viet Nam would help standardise financial management systems.
Hiroshi Yaguchi, vice chairman of the association and founder and executive director of the Japan Association for CFOs, told the forum that the world economy was relying on Asia to further grow.
He said the situation remained unstable and unpredictable and a second dip could still be triggered. However, the world economy had fully shifted to Asia.
The seminar was told that skilled human resources was the key to boosting industry and attracting foreign investment.
Le Dang Doanh, former director of the Central Institute for Economic Management (CIEM), said Viet Nam's economy had witnessed a significant recovery during the past two years.
Public and private investment remained at high levels. However, the exchange rate was strongly influenced by Viet Nam's rising inflation, budget deficits, increasing public and foreign debt, an international trade deficit and current account deficit.
To combat this, the Vietnamese Government had set an ambitious target of stabilising inflation while trying to reach a higher economic growth rate.
Foreigner buys buoy VN-Index
Foreigners buying blue-chip stocks helped the VN-Index in HCM City, rise 0.85 per cent to 434.48 points yesterday.
The value of trades was 10.9 per cent higher than Tuesday at VND597 billion (US$28.4 million) and volume totalled 30.2 million shares.
Foreign investors bought 4.5 million shares and sold 3.9 million. Their buying accounted for most of the volume for several of the most heavily capitalised stocks.
They bought 90,740 of the total 101,640 shares of Bao Viet Holdings traded in the session.
They also bought 90,740 of the 95,070 shares of software producer FPT Corp (FPT) traded.
Their buying increased the value of blue chips 0.7 per-cent with PetroVietnam Finance (PVF), up 4.83 per cent; BVH, up 4.07 per cent; FPT, up 1.43 per cent; Masan Group (MSN), up 1.64 per cent; Eximbank (EIB), up 0.74 per cent; Sacombank (STB), 0.72 per cent; and steel producer Hoa Phat Group (HPG), up 0.52 per cent.
VietinBank (CTG) and Hoang Anh Gia Lai (HAG) were among the blue chips to fall.
Seventeen stocks matched their ceiling price and nine fell to their floor prices.
In Ha Noi, the HNX-Index fell 0.03 per cent to 99.02 points.
Volume was higher than Tuesday with 30.2 million shares worth VND513.7 billion ($24.5 million) traded.
Only three of the 10 most capitalised stocks advanced.
They were PetroVietnam Insurance (PVI), up 2.44 per cent, Kim Long Securities (KLS), up 0.88 per cent and Asia Commercial Bank (ACB), up 0.43 per cent.
Twenty-one stocks fell to their floor price with the number matching the ceiling prices was just eight.
The markets were swayed when Prime Minister Nguyen Tan Dung revealed in the National Assembly a month-on-month increase in inflation for November of 1.86 per cent.
The General Statistic Office issued the same figure at noon.
The overnight volatility of global stock markets because of the tension on the Korean Peninsula added to the caution.
"Domestic investors began increasing the sell-off, especially at the end of session in HCM City, in response to the news," explained senior HCM City-based securities company broker Nguyen Cong Chinh.
The number of stocks matching their floor prices had increased 10 per cent against Tuesday.
"This means domestic investor have lost patience," he said.
Foreigner trading seemed to offer the only support for the markets, but this too began weakening to the mounting selling orders.
"I'm afraid foreigner support will not staunch a sell off tomorrow."
Latin America potential market for export firms
Pham Ba Uong said that bilateral trade between Viet Nam and Latin American countries was expected to exceed US$4.2 billion next year.
The Latin American market represents untapped potential for Vietnamese exporters.
Argentina's Ambassador to Viet Nam, Alberto Jaime Kaminker, said Argentina expected to attract investment in foodstuff processing, agriculture, seafood, joint offshore and onshore extractions of oil and gas, education and software.
The Viet Nam National Petroleum Group (PetroVietnam) and Argentina's state energy company ENARSA signed a memorandum of understanding on bilateral relations during a visit by a PetroVietnam delegation to Argentina in March.
Under the MoU, the two sides will work to exploit oil and gas on and offshore, provide services, refine oil and train experts.
Argentina has worked with Viet Nam's Ministry of Agriculture and Rural Development in technology transfer in the agricultural sector.
In the near future, Argentina plans to import more products from Viet Nam.
In the first seven months of the year, Vietnamese exports to Argentina reached $43.3 million, an increase of 51 per cent over the same period last year. Chief exports are shoes, textiles and rubber.
Argentina has offered preferential policies to promote foreign investment and business cooperation.
Lucas Vinicius Sversut, secretary of the Brazilian Embassy in Ha Noi, said Brazil wanted to work with foreign countries, including Viet Nam, in many sectors, including mining, steel, aviation, chemicals, agribusiness, engineering services, energy and IT, telecommunications and tourism.
The two-way trade between Viet Nam and Brazil reached $564 million last year and is expected to reach $1 billion by the end of the year.
Currently, Viet Nam trades with 33 nations and territories in Latin America, but total trade turnover is a modest 2 per cent.
Spain ready to invest more in VN
Viet Nam expects to attract further investment from Spain in energy sector as well as in infrastructure projects that require a large amount of capital, according to an official from the Ministry of Planning and Investment.
Nguyen Thi Bich Van, deputy head of the ministry's Foreign Investment Agency, said investment capital for infrastructure and energy development in Viet Nam accounted for one-third of its GDP.
Speaking at the Viet Nam-Spain Investment and Business Co-operation Forum held on Tuesday in HCM City, Van noted that capital for those sectors in the next five years would be around US$250 billion, with infrastructure accounting for $25billion.
Viet Nam and Spain have signed several bilateral agreements that will advance trade and investment, specifically the co-financing of the Metro Line No 5 in Viet Nam.
Hi-tech, support industries, infrastructure and human resource development are other areas where the two countries will work together.
Agricultural processing, the industry with a large export ratio, and the environmental and social security sectors are included as well.
Under Decree No 108 issued last year, the Government encourages investment in the forms of BOT, BTO and BT which applies to all investors.
Incentives, support and secure investments are offered to investors, such as tax exemptions and reductions in corporate income tax, land rental and imported equipment that is part of fixed assets.
"Viet Nam is one of the 15 most attractive countries for foreign investors because of several factors, including speed of market development, integration into regional markets, cheap labour and investment incentives," Van said.
Bilateral trade turnover between the two countries was $1.1 billion last year, and Spain is the seventh largest exporter of Viet Nam.
As of October, Spain ranked 58th out of 93 foreign investors in Viet Nam, with 17 projects totalling a registered capital of more than $21 million.
The Spanish Ambassador to Viet Nam, Fernando Curcio, said that with a high GDP growth rate of more than 6 per cent during the economic crisis, Viet Nam was one of the countries that had attracted Spanish investors' attention and trust.
Tu Minh Thien, director of the HCM City Investment and Trade Promotion Centre (ITPC), said the export turnover had increased by 30 per cent annually.
Of the EU countries, Spain is the main import market for Vietnamese catfish and is a major market for wood and handicraft products.
Vietnamese exports to Spain include seafood, coffee, textiles, shoes, electronic products, cashew, rubber and porcelain products, while it imports machines, chemicals, steel and medicine.
In the near future, the ITPC will focus on providing more information on trade, investment and tourism through organising seminars and cultural weeks in HCM City, Barcelona and Seville.
Business delegations will be organised frequently to survey the two countries' markets and exchange experiences on technology and seek partners.
Fernando Salazar, deputy chairman of the Spanish Institute for Foreign Trade, said that HCM City was among the most dynamic cities in Asia.
"Viet Nam is quickly becoming a key player in the region; and HCM City and the country will not cease in their efforts to become a highly industrialised, prosperous and modern economy."
ASEAN-member countries, of which Viet Nam is one, are also signing more trade agreements, which will further enhance investment activity.
According to the Organization for Economic Cooperation and Development, Viet Nam is expected to post the highest average growth rate, 7.1 per cent, among the six largest ASEAN economies in the 2011-15 period.
Spain is one of the world's three largest producers of wind energy, together with Germany and the US.
It is also the world's main transportation developer, with six Spanish companies among the top 10 in the world. Their projects include the subway systems of Washington DC and Mexico City, as well as the Sydney, Stockholm and Orlando airports.
"Vietnamese and Spanish companies need to take advantage of the current opportunities that offer our markets and to profit from all the agreements and support mechanisms set up by both governments," Salazar said.
Twenty-six Spanish companies and 150 Vietnamese companies participated in the forum.
Export earnings surge by 24.5%
Export earnings from January to November surged 24.5 per cent against the same 11 months of last year, preliminary General Statistics Office figures show.
The office puts total earnings to date this year at US$64.28 billion, including $6.45 billion for November.
It says the number of export staples with earnings of more than $1 billion was 16 in November, up by three against October.
The staples have made a significant contribution to total export revenue.
Garment and textile earnings of more than $10 billion, up 22.6 per cent against last year, topped the list.
Footwear and seafood earned $4.5 billion each, and crude oil $4.47 billion.
The increase meant that Viet Nam was likely to meet its target of $70 billion for 2010, up 22.6 per cent over the previous year, the Ministry of Industry and Trade forecast.
Director of the ministry's Export and Import Department Phan Van Chinh anticipated besides industrial products, agricultural, forestry and seafood products would also achieve high growth in the last month of the year thanks to advantageous export prices and abundant domestic supply sources.
Seafood was expected to earn the country more than $4.8 billion this year while the figure for rice exports would be roughly $2.6 billion, Chinh said.
Deputy general secretary of the Viet Nam Textile and Apparel Association Nguyen Son said that the textile and garment industry was on course to earn roughly $11 billion this year, $500 million higher than the Government's target.
Imports for November cost an estimated $7.7 billion, creating a trade deficit for the month of $1.25 billion and $10.65 billion for the first 11 months of the year.
The General Statistics Office says although the trade deficit equalled 16.6 per cent of total export earnings, it was still below the Government's 20 per cent target for the year.
It warns that measures to restrict the trade deficit should continue because of intense exchange-rate volatility and an imbalance in foreign currency supply and demand.
FDI disbursement rises in 11 months
Disbursement of foreign direct investment (FDI) in the first 11 months of this year increased by 9.9 per cent over to the same period last year to reach US$9.95 billion, according to the Foreign Investment Agency (FIA).
During the 11 month-period, the nation attracted $13.3 billion in FDI, down 40 per cent against the same period last year. The country had set a target of drawing $22-25 billion in FDI this year.
74 new foreign-invested projects were licensed in November, worth a combined $512 million.
However, there was no change in additional investment to existing this month compared to the previous month which saw $420 million invested in 57 ongoing projects, the FIA noted.
The Netherlands remained the leading source of foreign investment in Viet Nam with $2.32 billion, followed by South Korea with $2.28 billion and the US with $1.92 billion.
Over the 11 month period, the processing and manufacturing sector attracted the largest share of FDI, accounting for $4.37 billion. Production, air-conditioning, electricity and water distribution contributed $2.94 billion, while the real estate sector ranked third, hitting $2.85 billion.
Car imports decline
The General Statistics Office estimates imports of completely built unit (CBU) cars in November dropped by more than 50 per cent compared to the same month last year.
Roughly only 4,000 cars worth US$72 million were imported, against 11,500 units and $159 million in November last year.
Imports in the first eleven months of the year reached 46,000 units totalling $836 million, down 34.2 in volume and 22.4 per cent in value over the same period last year.
Industry insiders said that the downtrend differed from previous years when car imports often sharply increased at the end of the year in wake of an increasing demand ahead of the Lunar New Year (Tet) festival.
Industry insiders said that the decrease had been expected in the wake of the Government's measures to restrict the trade deficit which have led to an increase in the value of the dollar.
They said if the dollar remained high, car imports would continue to decrease next month and into next year despite high demand before Tet.
In another move, the Ministry of Finance has plans to slash import tariffs on cars.
The ministry has put forward a tentative proposal to lower tariffs from early 2011, while it is consulting with the Viet Nam Automobile Manufacturers' Association on the issue.
It plans to reduce the import tax rate on less-than-9-seat cars from 83 per cent to 70 per cent for imports from ASEAN countries. Meanwhile, imports from other regions will remain at 83 per cent in 2011.
Source: VNA
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