Vietnam's advertising wakes up to a changing industry

The internet, mobile, social media gaming and a new wave of consumers are changing the foundations of businesses. In Vietnam, digital advertising is forecast to double in the next three years.

Experts believe the trend of using digital advertising including online and mobile advertising will pick up in the near future.

According to Nguyen Tien Dung, manager of the digital section of Maxus Vietnam under GroupM, advertising on social networks has become a popular trend as many brands have deployed their advertising campaigns this way.

There are over 30 million internet users in Vietnam, of which 86 percent are using social networks, he said at a seminar on advertising held by the Leading Business Club in Ho Chi Minh City on November 20, adding that 81 percent of such social network users have the habit of sharing shopping activities with their friends.

Facebook is still the most popular social network in Vietnam with around 14 million users, with 11 million users accessing the network through mobile phones. Users spend an average of 40 minutes browsing this page daily.

Two actions that local Facebook users usually perform are to press the button “Like” and make comments, while in other developed markets, Facebook users often check in, meaning they inform their friends when they visit certain locations and upload pictures, Dung remarked.

However, he noted that it was not easy to make advertising on social networks and digital advertising effective, adding most local enterprises have made inconsiderable investments in digital advertising, which accounts for less than 5 percent of the total budget for marketing.

At the seminar, Phan Quoc Cong, general director of the International Consumer Products Corporation (ICP), said that his firm began paying attention to advertising on the Internet some years ago due to the rising number of Internet users then.

The marketing budget at ICP is divided into the ratios of 70 percent, 20 percent and 10 percent, Cong informed. The 70 percent volume has been carried out on local media, especially television, and has proved its efficiency, while the 20 percent volume is set aside for new channels whose efficiency is measurable and the remainder is used for new campaigns but its efficiency has yet to be measured, he stated.

The fact that an advertising campaign of ICP on television costs 1 million USD is normal, Cong asserted. But he said the cost would be only one-tenth, or around 100,000 USD, if the enterprise launched the campaign on the Internet, with the sum used for many different processes, ranging from creation and production to advertising.

Le Ho My Duyen, who is in charge of the high-end brands of ICP, argued that advertising on social networks should not be separated and that it should be integrated with plenty of other traditional channels, from television, newspapers, selling points to other related activities.

According to the market research company eMarketer, advertising sales on the Internet in Vietnam was about 26 million USD in 2012, making up 2.9 percent of the total sales of the whole market. The firm expects advertising sales on the Internet of the nation to reach roughly 32 million USD this year and 45 million USD in 2015.

Advertising sales on local media in Vietnam posted nearly 11 trillion VND in the first half of this year, with television holding up to 92 percent, Kantar Media Vietnam reports. The figure, however, is exclusive of sales of digital advertising.-V

Electricity market on the horizon in Vietnam

Prime Minister Nguyen Tan Dung has signed a decision on roadmap, conditions and structure to formulate and develop an electricity market in Vietnam, according to the Vietnam Government Portal.

Under Decision 63/2013/QD-TTg, the future market will see the formation of a competitive power generation market by late 2014 as in the first phase.

The second phase will focus on competitive power trading which will be piloted in 2015-16 before coming into being in 2017-21.

In the third phase, a competitive retail sale power market will be operating on a trial basis in 2021-23 and officially run from 2023.

The Ministry of Industry and Trade is responsible for building and submitting a project to restructure the power sector to realise development phases of the power market. It is also tasked to direct the implementation of the roadmap.

The Ministry of Planning and Investment must work with the Ministry of Finance to allocate enough capital for the process.

Meanwhile, the Electricity of Vietnam (EVN) has to invest and perfect necessary infrastructure for the operation of the competitive power market.

According to the decision, EVN’s power generating corporations and plants (excluding large-scale ones which play an important role in socio-economic, national defense and security) will no longer connect with power trading, transmission and regulatory units.

The decision will come into force on December 25, 2013.-

Vietnam, Hungary forge economic links

Vietnam and Hungary have agreed to step up their mutually beneficial cooperation in various potential areas during the fifth session of the two countries’ Joint Committee on Economic Cooperation that took place in Budapest last September.

The targeted realms include trade, industry, credit finance and investment, health, agriculture, water supply, environmental protection, information technology and communications, education and training, science and technology, tourism, transport and infrastructure.

The Vietnamese Ministry of Industry and Trade (MoIT) said on November 21 that the two sides reached consensus on the early signing of cooperation agreements in banking and vegetation quarantine in order to boost their economic and trade ties in the coming time.

Vietnam and Hungary will also create favourable conditions in terms of mechanism and policy for their businesses to enhance cooperation, the ministry said.

The committee’s fifth session was co-chaired by MoIT Deputy Minister Ho Thi Kim Thoa and Hungarian State Secretary for Foreign Affairs and External Economic Relations at the Prime Minister’s Office Peter Szijjiarto.

Red River Delta – Hai Duong trade fair opens

Representatives of over 200 businesses nationwide are attending the 2013 Red River Delta – Hai Duong trade fair in the northern province of Hai Duong from November 21-26.

They are putting on show industrial, handicraft products and consumer goods at more than 400 booths

The event creates a good chance for local and foreign firms to seek partners and sign trade deals.

A seminar will be held during the fair to provide participants with information on the market and demand in the region.

As part of the 2013 national trade promotion programme, this year’s fair also comes as a response to the campaign “Vietnamese prioritise Vietnamese goods”.-

Lotte trade centre put into use in Binh Duong

The Lotte retail group from the Republic of Korea on November 21 inaugurated and put into operation the Lotte Mart trade centre in the southern province of Binh Duong, the fifth of its kind in Vietnam.

The three-storey building worth nearly 30 million USD was built on an area of 21,300 square metres, not merely serving as a trade centre it includes a cinema, an amusement park, shops and restaurants.

According to the group, the 30 million USD Lotte Mart in Phan Thiet is scheduled to be fully operational by the end of this year.

Similar projects have been put to service in Ho Chi Minh City, the southern province of Dong Nai and the central city of Da Nang.-

Credit institutions asked to deal with bad debts

Recently, Governor of the State Bank of Vietnam (SBV) Nguyen Van Binh issued Document 8421/NHNN-TTGSNH on the implementation of the Prime Minister’s directives detailed the Decision 843/QD-TTg dated May 31, 2013 approving the two projects of "Dealing with bad debts of the credit institutions system" and "Establishing the Vietnam Asset Management Company". Vietnam Business Forum finds out more.

Based on this document, the SBV has called for credit institutions (CIs) to develop and implement plans to settle bad debts and improve credit quality in the 2013-2015 period (part of the overall plan to restructure credit institutions), following the spirit of Decision 254/QD-TTg dated March 1, 2012 (Decision 254) and Decision 843/QD-TTg (Decision 843) dated May 31, 2013 of the Prime Minister.

The objective is by the end of 2015, the current bad debts will have been basically cleared, credit quality effectively controlled and enhanced, successfully complete the objectives from the project "Restructuring the credit system 2011-2015" issued under the Prime Minister’s Decision 254 and the project "Dealing with bad debts of credit institution system" issued under the Prime Minister’s Decision 843.

The Governor has called for banks to assess bad debts and credit quality in 2011, 2012 and the first six months of 2013, including bad debts of credit level, bad debts from buying corporate bonds, fiduciary bonds and credit; bad debts divided into groups, collateral value and provision for risk corresponding to each group; bad debts with collateral (real estate and future real estate, commodities and other collateral) and without collateral; bad debts classified by customers of the State level (State-owned enterprises, including bad debts of state corporations and other businesses), individuals or households; bad debts classified by industry; bad debt incurred by affiliates, transaction offices, branches and units of CIs.

In addition, Vietnamese banks have also been required to perform analysis and evaluation on bad debts’ data and structure at the time of June 30th 2013 based on following classifications: bad debts defines under Decision 493/2005/QD-NHNN dated April 22, 2005 and Decision 18/2007/QD-NHNN dated April 25th 2007, but not under Decision 780/QD-NHNN dated April 23, 2012 of the SBV Governor; bad debts defined under Circular 02/2013/TT-NHNN dated January 21, 2013 of the SBV Governor (Circular 02) on asset classification, provision and provisioning method, as well as using reserves to handle risks in banking activities of CIs and foreign banks’ branches.

CIs also need to review, produce statistics, assess the status of loans including interest due but not paid which is added to the loan, in which clearly report the total debts classified in Group One, Group Two and other groups; loans for interests. CIs must evaluate accurately the level of risk of those aforementioned loans, financial situation and business activities relating to them.

Especially, CIs should propose solutions to deal with estimated bad debts in accordance with Circular 02 and Decision 843, estimate removable bad debts for each solution and each year up to 2015, including loans sold to the Vietnam Asset Management Company; solutions and plans to deal with bad debts of affiliates, branches and units of credit institutions.

In terms of improving credit quality, CIs need to develop measures to enhance the quality of appraisal and lending decisions (including changes in credit conditions, record, process, procedure, process of credit appraisal and approval, responsibilities of individuals and units in the process); measures to strengthen monitoring to guarantee loans are used for the purposes stated in the credit agreements.

Finally, the Governor requires CIs to introduce measures to strengthen internal inspection and control as well as internal audit of credit quality (for example proposing changes in internal control rules, inspection content and procedures, inspection before, during and after the credit approval); methods to handle illegal loan or loan posing a risk to CIs: classify, accounting these kind of debts in accordance with the law; to closely supervise the restructuring and handling; to create mechanisms which help prevent the arising of these kind of debts; and to stop providing illegal loans.-

Increasing connectivity boosts farm produce sales

Ten months after it was kicked off, the programme for cooperation in farm produce and food supply between Hanoi’s agricultural sector and those of 18 northern provinces and cities has beared fruit. Report by Vietnam Economic News.

Early this year the Hanoi Department of Agriculture and Rural Development signed agreements on the sale of safe vegetables, fruits, food, forest products and seafood with its counterparts in northern provinces and cities. Ten months after the agreements were kicked off, all participating localities have successfully worked together.

Nam Dinh province Department of Agriculture and Rural Development Deputy Director Nguyen Phung Hoan said that after signing the agreement, the amount of farm produce and food that Nam Dinh provided for Hanoi increased and the trade in these products between the two localities became more favourable.

Since early this year, Nam Dinh has supplied to Hanoi about 100,000 tonnes of high-quality rice, 20,000 tonnes of fruit and vegetables, and 50,000 tonnes of seafood. Policies on cooperation in controlling food safety and hygiene were formed and applied rather effectively, Hoan said.

Thai Binh province Poultry and Agricultural Farm Association Chairman Quach Thuoc said that Thai Binh was supplying to Hanoi pork, chicken meat and eggs, fruit and vegetables (12,000 tonnes of pork, 350 tonnes of chicken meat, 4.5 million chicken eggs, 3.3 million duck eggs, and 30,000 tonnes of gourd per year). All of these products were produced according GAHP (Vietnamese Good Animal Husbandry Practices).

In the first 10 months of this year, Thai Nguyen province launched onto the market 7 million poultries and about 500,000 pigs, 50-60 percent of which were sold to Hanoi. According to Thai Nguyen Province Veterinary Division Deputy Director Pham Quang Phuc, the cooperation has opened up mechanisms to better control animal products of unknown origins in Hanoi and provinces.

Lao Cai, Son La and Vinh Phuc provinces worked with Hanoi to produce and sell safe vegetables. About 10 tonnes of naturally raised chicken meat from Yen The in Bac Giang province were sold in Hanoi daily.

Although it hasobtained initial achievements, the programme still needs to be improved as its range of products remains poor and the programme has not satisfied market demand in terms of quantity.

Hanoi Department of Agriculture and Rural Development Director Hoang Thanh Van said that agricultural businesses in the capital have met only 69, 32, 84, 33 and 18 percent of the city's demand for cattle meat, fish, poultry eggs, fresh vegetables and fresh fruit, respectively. Therefore, Hanoi needs to import safe farm produce and food from other provinces and cities.

At a recent conference reviewing 10 months of cooperation between the Hanoi Department of Agriculture and Rural Development and its counterparts in the 18 provinces and cities, representatives from localities expressed desire to increase the connectivity between the participating parties, including that with businesses and co-operatives to invest in the production and sales of agricultural products for farmers.

Lao Cai province Department of Agriculture and Rural Development Director Ma Quang Trung proposed that Hanoi expand cooperation with Lao Cai in the production and sales of products that are Lao Cai’s strengths, such as Seng Cu rice, tea, off-season vegetables, highland fruit (pears, peaches, plums, grapes, kiwi and cherry), black pig and black chickens.

The Hung Yen province Department of Agriculture and Rural Development also proposed that Hanoi increase cooperation with the province in sales of products that are its strengths, such as fruit and ordinary rice.

Hanoi Department of Agriculture and Rural Development Director Hoang Thanh Van said that to increase connectivity in product sales between Hanoi and the other provinces and cities before, during and after the coming Lunar New Year which will fall by the end of the next January, localities should strengthen cooperation and information exchange in order to control the quality of products to be launched onto the market, improve accountability in disease prevention and quarantine, and control cattle slaughtering and origins to help protect consumers.

Foreign investors refind confidence

Although Vietnam’s real estate market has experienced a slowdown over recent years, the overall sentiment among international investors seems to have recovered.

Israeli billionaire Igal Ahouvi recently kicked off his first project in Vietnam, a $300 million resort in central province Khanh Hoa after several visits to Vietnam.

Meanwhile representatives from the Walton International Group recently visited Hanoi to look for opportunity to develop real estate projects.

According to Walton International Group marketing director Christopher Koh, real estate in Vietnam still was on the radar.

Koh especially expressed his interest in neighbourhoods lying just outside the city centre.

According to Mauro Gasparotti, executive director of real estate consultancy firm Alternaty Vietnam, there is a growing interest specifically towards Vietnam especially within the commercial sector and for income producing properties.

“There are tangibles signs of increased confidence among international investors regarding the real estate market in Vietnam,” Gasparotti noted.

A large number of investment funds and private companies were searching for deals over the past few years with limited results due to discrepancies on land value and achievable returns on investments. Investor interest dried up in 2012 and the first half of 2013 when the financial situation was unstable and the future outlook seemed bleak. Investors were increasingly focused on alternative investment destinations such as Myanmar and Indonesia, he added.

However, Gasparotti noted that over the past few months, as the financial situation seems to have stabilised with inflation brought under control, interest from these groups has returned because Vietnam offers more value oriented opportunities. At the same time, the opportunities in competing markets in South East Asia seem to be diminishing.

According to Rudolf Hever, another executive director of Alternaty, there were fundamental changes and game changing trends occurring right now in the region.

“Those who will prosper over the next decade will be the ones who recognise and embrace the opportunities that are emerging,” Hever noted.

The rapid rise of the middle class in Asia is only just beginning and is led by China. This will continue into the foreseeable future with countries such as Indonesia and Vietnam.

“This segment will have a strong appetite to travel abroad, and their target destinations, one of which is clearly Vietnam, will surely feel their impact, ready or not. One only needs to look at markets such as Phuket and Pattaya, to understand the vast scale and power of this new demographic,” he added.

Vietnam is now well placed to capitalise on these new trends and we are seeing more and more investors that are anticipating and looking to capture the opportunities that are emerging.

A few problems remain to be solved, such as bad debts, but Vietnam is in much better shape than just a couple of years ago. Inflation is down, economic growth is stable and slowly ticking upwards, FDI is up, interest rates have come a long way down and the dong has remained remarkably stable over the past couple of years.

“The local developers and land owners have been through tough times, but they are now finding increasing reasons for optimism,” he added.

$200 million allocated for Starlake project

Korean-backed Tay Ho Tay Development Company has received a $200 million boost from the Korean Development Bank for its urban development Starlake in Hanoi.

The funds will go into the project’s first phase, thus far totally invested in by Daewoo E&C. The Korean Development Bank’s (KDB) injection will enable Daewoo E&C to continue the project over the next two years and have its infrastructure system up and working immediately after getting land clearance from the Hanoi People’s Committee.

As well as infrastructure, the funds will go toward starting construction on the villa and housing complex expected to start in 2014.

The KDB made the financial commitment after a seminar in Korea last year aimed at attracting loans for the project.

KDB is a major stake holder in Daewoo E&C with more than 50 per cent and is also responsible for mobilising capital for the group’s projects.

According to Tay Ho Tay, the company has already invested more than $94 million into land clearance and compensation and nearly 80 per cent of the land needed for the first phase has been cleared.

Starlake has been in stasis since a ceremonial groundbreaking in January last year for several reasons.

Hanoi’s People’s Committee has actively pushed local departments to expedite land clearance and other regulatory processes and has set a goal to finalise all within this year.

Starlake would have a total investment of around $2.5 billion and is planned to be a modern, environmentally-friendly urban area by 2019 with 25,000 residents.

The project will include a promenade, parks, trees and lakes alongside the more traditional urban structures, as well as 25 hectares of open space devoted to public service activities and a headquarters building.

The developer hopes it will be a cultural hub and an international commercial and financial centre that follows the orientations of Hanoi’s master plan to 2030 with a vision to 2050 as ratified by the prime minister in 2011.

The project spans Tay Ho, Cau Giay and Tu Liem districts and joins up with the diplomatic area in the north with road linkages to the city’s spacious main arteries.

Starlake also plans to link up with a range of other key projects in Hanoi such as the road connecting the Nhat Tan bridge and Noi Bai Airport, the expansion of the airport, and ring roads 1, 2 and 3.

The project’s entertainment and retail businesses are expected to promote cultural exchange between Vietnam and Korea and its office facilities will house companies from both countries.

It is high time for Vietnam to rethink its policy of attracting foreign direct investment (FDI) if the country is to further accelerate its economic growth and escape the middle-income trap, an economist said on Thursday.

Pham Van Thuyet, an expert at the World Bank, told local reporters in HCMC that it is time now for drastic changes in FDI attraction, prioritizing investment in supporting industries.

Thuyet noted how the FDI flow had brought about positive changes in the economy, but such developments alone are not enough for Vietnam.

“In the 1990s, bicycles overwhelmed the street, but they were being gradually replaced by motorcycles and cars. However, the regrettable issue is that all such motorcycles and cars are assembled rather than manufactured in Vietnam, meaning the country still lacks a genuine automotive industry,” Thuyet said.

Another drastic change benefiting the local economy greatly is the country’s trade liberalization as Vietnam has signed free trade agreements with other countries and joined more international organizations. However, trade liberalization has also unveiled flaws in the economy, with the most striking one being the absence of supporting industries.

Thuyet urged the Government to make changes to FDI policy so as to work with foreign investors to build a solid industrial foundation, especially the development of supporting industries. They should initiate talks with foreign investors on investment stories, the expert said.

“This is a time when Vietnam has a good stance to renegotiate the issue with foreign investors. This is what the Government should do,” he stressed.

Thuyet observed that Vietnam still does not have a genuine industrial foundation, as its industrial development is merely confined to processing and assembly. Therefore, in the global supply chain, Vietnamese enterprises could only join some tiny parts at the beginning of the continuum, so the added value for Vietnam is negligible.

Thuyet doubted the possibility of Vietnam becoming a newly-industrialized economy by 2020 as targeted by the country’s leadership, since “the time left is too short.”

Therefore, to escape chaotic industrial development and to avoid stagnation that the country has suffered over the past few years, Vietnam should vigorously pursue the market-based economy. As such, the role of the State economic sector should be reconsidered, and there should be incentives to further boost the development of the domestic private sector, he said.

Over 10,000 cars sold in October

The local automobile market kept growing in October and hit sales of over 10,000 units for the first time this year.

According to the latest report of the Vietnam Automobile Manufacturers’ Association (VAMA), nearly 10,300 cars were consumed in the local market last month, up 5% against the previous month and 29% against the same period of 2012.

This was the first month this year auto sales surpassed 10,000 units and the seventh straight month car sales volume reported a year-on-year increase.

Explaining the strong sales, local firms said that consumers usually have high demands for cars in the final months of the year. In addition, the ninth Vietnam Auto Show in HCMC in September helped push up sales as many enterprises introduced new cars and offered preferential sales policies.

Last month, over 7,800 domestically-assembled cars were sold, up 2% month-on-month, while sales of imported cars increased 17% to nearly 2,500 cars. Of which, Honda Vietnam sold 422 automobiles, up 94%, Vinamazda sold 438 cars, up 242%, Ford Vietnam 890 cars, a 66% increase, and Toyota Vietnam with over 3,200 cars, up 28%.

Between January and October, over 87,000 automobiles were consumed in the country, up 19% year-on-year. Of which, there were over 75,700 locally-assembled cars, up 18%, while imported cars increased 25% to 11,400 units.

Local manufacturers expect that the market will keep improving and car sales will stay at over 10,000 units a month until the year-end. Big cities in the country have also reduced registration fees for new cars, stirring up the market.

VAMA expects that 109,000 automobiles will be consumed in the country this year, up by 9,000 compared to estimates earlier this year.

Meanwhile, around 3,000 cars were imported to Vietnam last month with the total value of US$58 million. The import volume remained unchanged compared to September while the value declined by US$15 million, according to the General Statistics Office.

In the first 10 months, the nation imported around 28,000 cars worth US$551 million, up 30% and 12.9% year-on-year respectively.

HAGL to sell oversea-made sugar to local firm

Hoang Anh Gia Lai Company (HAGL) is offering 30,000 to 40,000 tons of sugar it has produced in Laos to Bien Hoa Sugar Joint Stock Company, raising concerns over huge sugar stockpiles in the country.

Earlier, some sugar companies expressed concerns over HAGL’s investment in sugar production in Laos, saying that the project will cause adverse impacts on the local sugar industry and sugar prices.

Nguyen Van Loc, general director of Bien Hoa Sugar Company, told the Daily that if Bien Hoa buys sugar from HAGL, it will mainly buy crude sugar and then refine it and export to other markets.

Therefore, the deal between the two companies will not cause any impacts on production and business of other sugar firms in the country, Loc said.

However, Vietnam’s sugar import quota as committed to the World Trade Organization is 73,500 tons in 2013 and the Ministry of Industry and Trade has allocated the quota to some enterprises. Therefore, Bien Hoa will import HAGL’s sugar via unofficial channels or auxiliary border gates only.

Doan Nguyen Duc, chairman of HAGL, said that the enterprise is negotiating with Bien Hoa Sugar to carry out transactions as mentioned above.

Earlier, speaking at the annual general meeting in April, Duc had said that sugar produced in Laos will be sold to China and Europe in the future.

If Vietnamese firms could export sugar to China, HAGL also could also do so instead of bringing the product back to Vietnam as many local enterprises are worried, Duc told the press at that time.

However, Duc told the Daily via telephone on Wednesday that HAGL has plans to offer its sugar in many markets. The enterprise wants to offer sugar in Vietnam as sale prices are higher than other markets.

Local enterprises have faced many difficulties in exporting sugar to China. According to the Vietnam Sugar and Sugarcane Association, given challenges in the Chinese market and sugar smuggling in southern border provinces, stockpiles of local sugar factories will pile up. As a result, the factories are forced to buy sugarcanes from farmers at low prices.

In the 2013 sugarcane crop that began in October, material sugarcanes in the Mekong Delta have been bought at just VND850 per kilo of cane, down by VND100-150 a kilo against the same period last year.

First Aeon store to open in early Jan

Japan-invested Aeon Vietnam will open around 20 shopping malls across Vietnam in the next seven years, with the first one scheduled for opening next January, said the company’s chief executive officer.

General Director Yasuo Nishitohge said at a scholarship awarding ceremony in HCMC on Thursday that its first shopping mall in Vietnam would be the Aeon Tan Phu Celadon in Tan Phu District.

“Aeon Tan Phu Celadon will have total floor space of 80,000 square meters, with half being the commercial area comprising of the shopping mall and a section for lease with some 300 stands,” he said. The remaining half will be sparking space able to accommodate 1,000 cars and 2,800 motorcycles, he said.

After this first mall, the company will open its Aeon-Binh Duong Canary mall next October, and Aeon Mall Long Bien in Hanoi in 2015.

“We plan to open 20 shopping malls in Vietnam between now and 2020,” Nishitohge said.

Regarding the first shopping mall, Aeon Vietnam has poured some US$100 million into the project. This shopping center is part of the 82-hectare complex Celadon City, which will have 8,000 apartments by the turn of the decade.

Each Aeon shopping mall will recruit some 2,000 people. To do so, Aeon Vietnam has over the past three years awarded scholarships to Vietnamese students learning the Japanese language, especially those at the HCMC Pedagogy University and the University of Social Sciences and Humanities.

Nishitohge said that in this year’s academic year, his company offered 60 scholarships worth VND6 million each for students of the two universities. Until now, nearly 200 students have benefited from the company’s scholarship fund.

The CEO furthered that Aeon has maintained an international scholarship fund since 2006 by deducting 1% of the group’s gross profits coupled with donations from other philanthropists.

In another scholarship award event last year, Nishitohge said Aeon Group would cooperate with Vietnamese producers and suppliers to bring domestic products to its global retail network. He said then that Aeon had held a meeting for suppliers in the city as a first move to secure local supply. The enterprise would pay attention to export products Vietnam has advantages such as apparel, footwear and plastic.

Bayer’s world tour arrives in Vietnam

Bayer’s Global Anniversary Tour initiated to mark the Germany-headquartered multinational company’s 150th birthday has arrived in Vietnam, taking place at the White Palace Convention Center in HCMC’s Phu Nhuan District from November 10 to 13.

The four-day event, attracting thousands of visitors and Bayer Vietnam’s partners, featured multimedia platforms combining both entertainment and education with an aim to disseminate information about the company to the audience, reflecting Bayer’s commitment to community development.

The world tour, which began in Germany’s Leverkusen in late February, has taken in 30 destinations around the world, showing to Bayer’s partners how the group has made its contributions to improving the livelihood of millions of people in the world, Bayer Vietnam said in a statement.

“Bayer Vietnam is proud to welcome the Global Anniversary Tour to HCMC. What is special in this exhibition is the high interaction between exhibits and the audience,” said David J. Champion, general director of Bayer Vietnam.

“With vivid illustrations from the real life, the exhibition clearly indicates how Bayer has contributed to improving the lives of millions of people in the world,” he said in the statement.

At the exhibition, visitors were encouraged to interact with the exhibits being 22 boxes, each containing a capital letter that when combined together represents Bayer’s mission of “Science for A Better Life.” Each letter stands for a topic related to Bayer, such as E standing for energy-efficient mobility or S representing science.

Visitors could also engage themselves in the various games at the exhibition, by which they would learn about Bayer’s products or services.

The exhibition also incorporated other activities, such as a dinner party for Bayer’s partners, a discovery festival for students, and a seminar on sciences for a better life.

Bayer is a multinational group specializing in such key areas as healthcare, agriculture, and high-tech materials. The group last year obtained total revenue of 39.7 billion euros.

Hoa Sen to raise output by 20%

The management board of Hoa Sen Group (HSG) plans to increase its production capacity by 20% in the next fiscal year, said general director Tran Ngoc Chu.

In the fiscal year 2012-2013 which ended last month, Hoa Sen earned an estimated VND11.752 trillion in revenues. Meanwhile, its after-tax profit was VND580 billion, increasing by up to 58% year-on-year and equivalent to 145% of the target.

With such results, HSG is one of the listed enterprises to beat its targets and achieve good business results in 2013 on the stock market.

HSG continues to prove its leading position in producing roofing sheets in Vietnam with a market share of nearly 40% and is a leading exporter of roofing sheets in Southeast Asia.

Its sale volume rose by 33% from the fiscal year 2011-2012 to over 600,000 tons, including an export volume of 279,000 tons, up 55% and accounting for 122% of the target.

“This is the first year we have exported steel roofing sheets to Africa and the absorption rate there is relatively good,” Chu told reporters.

“We will expand the exporting markets to Eastern Europe, Africa and other markets in the coming time. The export volume is expected to increase by at least 20% next year,” he said.

Regarding risks of anti-dumping lawsuits in some regional markets, HSG has settled all the lawsuits with Indonesia no longer suing HSG for dumping, Chu said.

According to Chu, HSG was still working on the target ‘three 1-s’, which are sale volume of 1 million tons, revenues of US$1 billion and after-tax profit of VND1 trillion.

To achieve this, HSG is increasing the production capacity and expanding the closed production process via investing in the second phase of Hoa Sen Phu My steel sheet plant. The fifth production line is expected to be put into operation by September, 2014.

HSG has spent over VND20 billion on social activities this year. Besides, it signed a deal on Tuesday to grant VND1.5 billion to Bac Lieu Province to develop rural areas in Phuoc Long District.

Last month, HSG donated 22,000 square meters of roofing sheets worth around VND1.25 billion for people in Danang City and Quang Binh and Quang Nam provinces heavily affected by storms No. 10 and No. 11.

Dai-ichi Life Vietnam honored for CSR endeavor

Dai-ichi Life Vietnam has brought home the “Corporate Social Responsibility Award” as a result of its great support and initiative for the community.

At the Asia Insurance Review Awards 2013 in Singapore last week, judges honored the company for its “commitment of substantial resources and time to achieve significant and sustainable benefit to the community in environmental arenas - the outstanding community initiative of providing clean drinking water project for rural pupils in the country.’’

Takashi Fujii, chairman and general director of Dai-ichi Life Vietnam, said in a statement that the company was the first life insurance company in Vietnam to win such a prestigious industry accolade in Asia.

“With our corporate vision ‘Thinking People First,’ Dai-ichi Life Vietnam has been recognized for its strong commitment to service excellence in the industry. And apart from a culture of caring about our customers, we also believe that we have the responsibility to support the community in which we live and work, and this is a major element of our corporate mission,” Fujii said.

Last year, Dai-ichi Life Vietnam in partnership with East Meets West Foundation initiated a community project entitled “For A Better Life” to provide clean drinking water to over 18,000 pupils in rural areas of 10 provinces in Vietnam. The company donated US$50,000 to install 24 UV water filtration systems in 24 rural schools nationwide.

Dai-ichi Life Vietnam was established in January 2007. Vietnam was the first foreign market that Dai-ichi Life (Japan) expanded its business through a 100%-owned subsidiary. After one year of operations in Vietnam, Dai-ichi Life Vietnam got the Ministry of Finance’s approval to increase its charter capital from US$25 million to US$72 million.

Interest rates inch up as year-end cash demand rises

Short- and medium-term deposit rates have been rising steadily since early this month as banks compete for funds to meet the cash demand expected to rise in the final months of the year.

Before the current rate rally, the deposit rate for months on end at most banks was hovering around 6% a year or less for short-term deposits, while the rate for longer terms of between six months and one year was some 7%.

But the rate at most banks has risen since a fortnight ago to 6.5-7% for short-term funds and 7-7.5% for tenures of up to one year, while longer-term deposits are subject to rate of 8-9%.

Le Thanh Trung, deputy general director of HD Bank, explained that it was reasonable when interest rates inched up at this time as the demand for cash to pay wages and bonuses as well as capital to import goods for the upcoming shopping season is running high.

“Banks have to prepare for cash to meet the high demand,” he said.

Phan Huy Khang, CEO of Sacombank, reasoned that many debts were restructured from short-term to long-term debts, which also impacted the cash flow, resulting in higher demands.

Another banker in HCMC said the race to mobilize funds at rates higher than the ceiling of 7% was not quite widespread, with smaller banks offering a deposit rate of 8-9% for short-term deposits of two to six months, or some 1-2 percentage points higher than at big banks.

A senior leader of the central bank, meanwhile, cited several reasons for the rate hike. These include the slower cash flow at smaller banks, the increasing amount of bad debts at certain banks, and the dwindling injection of funds by the central bank via open market operations, he said.

Therefore, most banks seek to attract funds from the public to repay due deposits at the year’s end as well as to meet the rising demand for capital, as the credit growth often accelerates in the final months of the year.

Another reason, said the source, is that certain smaller banks have used short-term deposits to make long-term loans, and now they have to attract funds to compensate for the shortfall when such deposits are due.

At bigger banks, however, the demand for funds is also higher since many of them have spent big amounts on Government bonds, resulting in short positions. Around VND170 trillion has been spent by banks on such bills, said the central bank’s official.

The source said that the amount of deposits at banks now totals between VND150 trillion and VND170 trillion, while banks should inject some VND100 trillion into the economy if the overall credit growth is to attain 10% as targeted compared to the current growth rate of 7%. Therefore, the rate hike now is understandable, the source said.

All industry sources said the rate hike was not caused by liquidity problems, as banks still have ample funds since deposits still outpace the credit growth. As an evidence, the total amount of inter-bank transactions since early this year has fallen, which show that banks are not borrowing from one another.

Ten-month imports, exports hit US$217.59 billion

Latest data from the General Statistics Office showed that total imports and exports hit US$25.12 billion in October, up 11.9 percent compared to the previous month.

Of which, exports reached $12.61 billion, up 12.8 percent and imports touched $12.51 billion, up 11 percent, resulting in a trade surplus of more than $100 million in October.

Since the beginning of this year, total import and export turnover in the first ten months was at $217.59 billion, up 15.9 percent year-on-year, with exports at $108.72 billion and imports at $108.87 billion, up 16 percent and 15.9 percent year-on-year, respectively.

Total imports and exports of foreign direct investment sector in first ten months reached $128.65 billion, accounting for 59.1 percent of the country’s total imports and exports.

By the end of October, trade gap was at $146 million, down 6.8 percent compared to the same period last year.

 Soc Trang Expands Dairy Farming

After nearly 10 years, the dairy cow herd of the Mekong Delta province of Soc Trang has risen to 4,000 head, a sharp jump from the initial 477 in 2004. Soc Trang is calling for investment in dairy farming projects as part of its “Developing dairy cows in Soc Trang Province in 2013-2020” strategy.

The cowshed of Lieu Van Do, a member of Evergrowth Cooperative in Vien An Commune, Tran De District, Soc Trang Province, is now home to 10 cows, from just one in 2004. Each of the cows earns Do VND20-25 million a year, a dream profit for many farmers!

Do is one of more than 1,500 farmers who have succeeded in rearing dairy cows in Soc Trang. According to Tran Hoang An, director of Evergrowth Cooperative, there are now 3,957 cows raised in the province under the cooperative’s management. Dairy farms are mainly in Tran De, My Xuyen, My Tu and Chau Thanh districts. On average, a farmer can gain annual turnover of VND45-50 million and profit of VND20 million per cow.

Evergrowth has six milk purchasing outlets in Tai Van, Thuan Hung, Tham Don, Vien An, Dai Tam and Thuan Hung communes.

The cooperative has set out standards with which farmers are able to rear milk cows in a sustainable way. The cooperative also maximizes benefits for farmers, from ensuring milk purchases at highly stable prices to supplying inputs such as bran, veterinary medicines and services at low prices. A team of five well-trained veterinarians and 27 veterinary collaborators has been maintained to help farmers raise cows and produce milk in accordance with a high-quality technical process that can minimize costs to increase profits.

A dairy cow can produce 13kg a day this year from 7kg in 2006. The volume of purchased milk has also increased steadily, from 508 kilos in 2004 to 13.5 tons in 2012 and nearly 16 tons in the first 10 months of 2013. The main buyer of Evergrowth’s milk is FrieslandCampina Vietnam (FCV) in Binh Duong Province. In addition, FCV has signed a memorandum of understanding with Soc Trang Province, according to which, FCV will invest 512,395 euros in building a model farm to rear 80 cows, with 50 of them ready to give milk after three years.

The Soc Trang Province People’s Committee has requested the Department of Agriculture and Rural Development to devise the “Developing dairy cows in Soc Trang Province in 2013-2020” project. Cow rearing farms will be located in Van Binh, Lieu Tu and Thach Thoi Thuan communes in Tran De District. By 2020, all communes in Tran De District will have dairy farms in addition to Thanh Phu and Thanh Quoi communes in My Xuyen District; An Hiep, Phu Tan, Thuan Hoa and Ho Dac Kien communes in Chau Thanh District; and the suburbs of Soc Trang City.

Soc Trang Province has sent a document to the Government asking for the approval of using 805 hectares owned by Soc Trang Forestry Co. for rearing dairy cows. In the 2014-2016 period, there will be 50 farms, each covering six hectares with 80 head including 50 ready to give milk. Similar figures are also set for the 2017-2020 period.

Evergrowth Cooperative has also called for support from FCV and the Netherlands’ Rabo Foundation in its effort to raise the milk cow herd and profit. In 2013, the 4,000 dairy cows are expected to yield a profit of VND4.2 billion. In 2014 and 2015, the figures will be 4,500 and VND5.9 billion, and 5,400 and VND6 billion, respectively.

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