Buyers rush for gold despite downside risks ahead

As local gold prices have dropped to a two-year low, buyers have been queuing up since Wednesday at gold trading firms despite risks of further decline.

Gold prices slumped by an additional VND530,000 a tael at home on Thursday, with the selling price of Saigon Jewelry Holdings Company (SJC) gold plunging to VND39.4 million a tael. The yellow metal has steadily tumbled in the past ten days, losing a combined VND1.27 million a tael, or 3.12%.

Meanwhile, global gold has even fallen more drastically, contracting by nearly US$100 an ounce or 7% in the same period to US$1,290 an ounce on Thursday. A tael is equivalent to 1.2 troy ounces.

Gold transactions in the local market have therefore bounced back given low prices.

Nguyen Cong Tuong, deputy sales manager of SJC, said his firm sold around 3,000 taels on Wednesday and some 2,000 taels on Thursday morning, much higher than an average of 1,000 taels in the previous days.

Nguyen Ngoc Trong, sales director of Phu Nhuan Jewelry Joint Stock Company (PNJ), meanwhile, said his enterprise sold about 800 taels on Thursday, a two-fold rise over other normal days.

Unlike previous years, the gold demand in the local market over a longer period has been low and this is the reason why PNJ has bought little gold via auctions by the central bank recently, Trong remarked.

Local gold traders have recently referred to the winning bids in the central bank’s auctions to set their own price, meaning firms will use the successful average bidding price every day with expenses and profits taken into account to calculate selling prices.

Experts, however, warn that the global gold price has now entered the downward-sloping of the price cycle, meaning steeper price falls are projected for the coming years.

Economist Phan Dung Khanh predicted the global gold price to continue dropping in the next three to five years after hitting a record high at the end of 2011 as the uptrend of global gold prices lasting for 12 years has already come to an end.

Many trust funds in the world are offloading their gold holdings. SPDR Gold Trust, for example, has sold 350 tons of gold, reducing its holding to some 1,000 tons after financial institutions had cut their forecast for gold holdings this year.

India as the world’s biggest gold consumer has also called on the people to buy less gold to support its currency.

Therefore, holding gold now is not a wise decision, said Phan Dung Khanh.

Gold prices continued falling in the trading session in the European market on Thursday afternoon. The gold priced quoted at www.kitco.com at 5p.m. on Thursday slipped to US$1,290 an ounce, a contraction of US$60.5 an ounce versus the end of the trading session on Thursday.

Local gold prices now are VND6.6 million a tael higher than global prices.

Vinamilk invests heavily in dairy farming

After pouring more than VND4 trillion to construct two processing mills in the southern province of Binh Duong, Vietnam Dairy Products Joint Stock Company, or Vinamilk, will not build more factories but will focus on developing large-scale dairy farms from now to 2017, instead.

The Government has given approval in principle to Vinamilk to set up a joint venture with Thong Nhat Farming Area to develop a dairy farm in the north-central province of Thanh Hoa.

The 2,600-hectare facility will become a big dairy farm with a herd of 26,000 head, or around ten head for one hectare, with milk-producing cows making up roughly 50%. The farm whose construction will be divided into many phases will be completed in five years based on Australian and New Zealand models.

Vinamilk has five dairy farms with a total of over 8,000 head at present, with every facility owning 2,000-3,000, which will be raised to around 25,500 head in 2015 and 28,000 by 2016 under the firm’s planning. To carry out the plan, Vinamilk has spent over VND1.5 trillion developing four more farming areas in Thanh Hoa, Tay Ninh and Ha Tinh provinces.

Besides its own farms, Vinamilk purchases fresh milk from farming households, which accounts for up to 60% of the country’s total fresh milk volume provided by local farmers. The company bought a combined 160,000 tons of fresh milk in 2012, posting growth of 12% year-on-year.

An executive of Vinamilk said his enterprise wouldn’t invest in constructing more processing mills but would concentrate on developing input material zones from now until 2017.

Vinamilk in April put into operation a powdered milk factory with a designed annual capacity of 54,000 tons and will commission a liquid milk plant at the end of August with an annual capacity of 400 million liters in the first phase, which will be doubled in the second phase.

With the existing factories, Vinamilk is looking to achieve total revenue of US$3 billion in 2017 to enter the world’s top 50 milk companies. Meanwhile, the entity has set a target of obtaining VND32.5 trillion in sales in 2013 which its leaders said is achievable due to its remarkable sales growth in the first six months.

It is noted that Vinamilk had to scale down its export orders to meet rising local demand and only when the powdered milk came on stream in April could the firm satisfy both exports and domestic sales. Vinamilk earlier this year won export contracts totaling US$230 million, a year-on-year surge of US$180 million.

Phu Thai launches new retail brand

Phu Thai Group Joint Stock Company has parted the Japanese retail brand FamilyMart and developed its own brand: B’s mart.

Speaking to the Daily on the sidelines of a meeting announcing the establishment of B’s mart Co. held in HCMC on Thursday, Phan Viet Hung, deputy general director of Phu Thai, said his firm had taken over all the stakes in Vietnam FamilyMart Co. to establish the retail brand B’s mart. However, Hung did not elaborate on the deal.

B’s mart is wholly owned by Phu Thai.

According to Hung, with the deal in place, most of the FamilyMart stores will be renamed as B’s mart while FamilyMart still has one store in the city and continue developing its brand here.

This means FamilyMart does not withdraw from the Vietnamese market as previously rumored but has pulled out of the retail venture with Phu Thai.

Phidsanu Pongwatana, general director of B’s mart Co., said B’s mart planned to open an additional 20 convenience stores in HCMC this year, raising the total to 62. After that, B’s mart would expand to Hanoi, he added.

B’s mart also intends to open supermarkets, hypermarkets, bookstores and drugstores.

TAL plans major textile plant in Vietnam

Hong Kong-based apparel manufacturer TAL Group plans to boost investment in Vietnam with its second project in the field of textile, dyeing and garment worth hundreds of millions of U.S. dollars.

Roger Lee, CEO of TAL Group, revealed this plan at a meeting with leaders of the Ministry of Planning and Investment this Wednesday.

TAL currently has 25,000 workers at eight factories worldwide. The Hong Kong clothing producer came to Vietnam in 2004 to set up the US$40-million textile-garment factory Viet My (TAV Limited) in Phuc Khanh Industrial Park in Thai Binh Province, where more than 3,000 workers are working.

TAL intends to open a second factory in Vietnam with an estimated investment of US$200 million in the first phase. The plant will apply modern and environmentally friendly technology.

Lee said that during his visit to Vietnam, he would also meet representatives of the Ministry of Industry and Trade and Vietnam National Garment and Textile Group (Vinatex) to discuss the project. TAL wants the planning ministry to give it advice on a suitable location for its new project, says the website of the planning ministry.

Deputy Minister of Planning and Investment Cao Viet Sinh said TAL should consider factors like road access, labor, land rent, assistance from local authorities and the current situations in some northern provinces like Hai Duong, Hung Yen, Ha Nam and Nam Dinh before coming to a decision.

The planning ministry is willing to support and offer TAL favorable conditions to expand investment in Vietnam. The ministry will ask its Foreign Investment Agency to directly work with TAL to accelerate the project development, said Sinh.

According to textile-garment firms the chance to attract foreign direct investment (FDI) into material production to enjoy the incentives offered by the Trans-Pacific Partnership (TPP) and free trade agreements (FTA) is being realized, said the industry players.

Since last year, multiple foreign fiber, yarn and textile producers have come to Vietnam to seek opportunities for investment in textile, dyeing and material production.

Large firms like Texhong and Sunrise of China, Toray International and Mitsui of Japan, and Lenzing of Austria have expressed interest in forming joint ventures with Vinatex or its subsidiaries.

Several projects have been set up. For example, Thien Nam Sunrise Textiles JSC, a joint venture between Thien Nam Investment & Development JSC of Vietnam and Sunrise Textiles Co. Ltd. of China, was established in November last year. The venture will develop a factory in Bao Minh Industrial Park in Nam Dinh with a monthly capacity of one million meters of woven fabric and 300 tons of knitted fabric.

Recently, South Korean textile company KyungBang has opened a plant in Binh Duong costing US$40 million in the first phase to utilize tariff incentives under Vietnam’s regional and international commitments. Lee Kap Soo, general director of KyungBang Vietnam Co. Ltd., revealed this textile plant was part of KyungBang’s plan for US$140- million investment in Bau Bang Industrial Park.

After building two plants in Dong Nai and Quang Ninh, Texhong of China has worked with Vinatex over its third production facility in Vietnam.

Lenzing of Austria wants to join hands with Vinatex to develop a system of integrated plants for production of wood pulp and viscose rayon in Vietnam.

Foreign investors are coming to Vietnam to form a partnership in the textile-garment sector because Vietnam is in talks over TPP and an FTA with the EU.

If negotiations were successful, TPP would come into force in 2015. Then, textile-garment products made of locally-sourced materials would enjoy a zero tariff when exported to the TPP markets, urging foreign investors in pour capital into textile-garment material projects.

With the Generalized System of Preferences (GSP) of the European Union, effective from January 1, 2014, the Vietnam-Japan Economic Partnership Agreement (VJEPA) and negotiations over TPP, the textile-garment industry has great chance of expanding its markets, said experts.

Rice price drop forecast to spur trading

Experts have forecast rice prices will continue the downtrend and trading may be more active toward the final months of the year.

Among the major farm items, rice had posted the sharpest drop in export prices by the end of the first quarter. Some 1.57 million tons of rice was exported in the first quarter, up nearly 18% over the same period last year, but export prices averaged out at only US$440 per ton, down 10%, according to customs data.

In the second quarter, rice export prices have continued sinking, from US$400-410 a ton of 5% broken rice in late April to US$375-385 in May.

In the first half of 2013, rice prices of India and Pakistan have moved flat, Thai prices have gone down from high levels and already-low Vietnamese prices have declined further. This is abnormal, said Nguyen Dinh Bich, an expert from the Institute of Trade Research under the Ministry of Industry and Trade.

“The downtrend in Vietnamese rice export prices in the first six months is obvious,” he said.

In the local market, prices of the dried paddy IR 50404 have been falling since May and currently stay at VND4,600-4,900 per kilo, versus VND5,000-5,200 in the beginning of the winter-spring crop. Sometimes rice prices inch up, but the overall trend is downward.

Bich forecast rice trading in the world market would be busy again in the final months of 2013, but prices might dip further.

“From now to the end of the year, or at least the end of the third quarter, the chance for global rice price drop is stronger than the chance for price increase,” he told the Daily.

Thailand is under pressure from a buildup of rice inventory and thus might lower prices. Meanwhile, India enjoys a bumpy crop, while rice import demand is forecast to remain unchanged.

“Therefore, it seems almost certain that global rice prices will not rise any time soon,” he said.

Pham Thai Binh, director of Trung An Co. in Can Tho, said it was possible that rice trading would thrive in late 2013, especially in the segments of fragrant and high-grade rice.

“Recently, more buyers have come and shipments have been sent more frequently. In the last ten days, Jasmine rice has picked up US$40-50 a ton and fragrant rice can hardly go down, at least until the year’s end,” said Binh.

However, an expert from the market research firm Agromonitor said Vietnamese rice export in the coming time would depend on the demand of the Philippines and Malaysia. “If they (the Philippines and Malaysia) imported much and early, the market would be bustling. Otherwise, the opposite would happen,” he said.

Earlier, the Vietnam Food Association (VFA) forecast rice export would grow again from July onwards as the demand of the major buyers, Indonesia and the Philippines, strongly increased.

Seafood exports likely to reach US$6.5 bil.

Seafood exports brought home US$600 million this month, taking the six-month value to a combined US$2.8 billion, showing a high possibility that the seafood industry will obtain export value of US$3.5-3.7 billion in the last six months of the year.

Truong Dinh Hoe, general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), forecast that this year’s seafood exports will likely amount to US$6.5 billion, up about US$300 million from 2012, despite a number of key products facing export difficulties.

Although tra fish and shrimp as the two key seafood export products are facing difficulties given the anti-dumping and anti-subsidy tariffs set by the United States, the opportunities for increasing the country’s seafood export value are still abound, he noted. The chances of seafood exports lie in decreased lending rates, allowing local firms to gain access to low-interest loans, he explained.

Tran Van Linh, vice chairman of VASEP, meanwhile, noticed shrimp exports have also changed for the better.

The shrimp farming industry has basically contained the early mortality syndrome (EMS) which has caused huge damages to shrimp supply for export processing, said Linh, who is also director of Thuan Phuoc Company in the central province of Danang. Besides, he added, Japan as the second biggest shrimp importer of Vietnam has already removed 100% checks imposed on shrimp imports from Vietnam for Trifluralin.

Furthermore, the tra fish industry has welcomed good news that the U.S. House Committee on Agriculture already passed the draft agricultural law 2013 with many revised contents including removing the catfish inspection conducted by the U.S. Department of Agriculture (USDA). The just-removed program is said to have cost the U.S. dearly and caused difficulties for catfish imports from Asian countries.

Apart from a year-on-year decline in tra fish exports from January to June, shrimp and seafood exports all increased. Tra fish exports reached US$800 million in the first six months, shrinking 7.3% year-on-year, while shrimp exports posted more than US$1 billion in value, up 1.5% year-on-year.

Bkav on Gartner's ‘cool vendor' list

Information technology research and advisory company Gartner recently announced its ranking of top IT companies in emerging markets, including a listing for Vietnamese firm Bkav Corporation.

Also featured in the list are E-Like from Brazil, DocPlanner from Poland and two other businesses from India and South Africa.

Gartner says Bkav represents a new competitive force in the network security market for businesses and consumers who want to be secure against attacks from malicious software.

The first Vietnamese firm to be ranked in Gartner's list, Bkav has just shifted to a joint stock company based on an IT corporation model. It has established a branch in Silicon Valley, California and plans to introduce several services that can compete with those from Google.

Gartner's research provides a good reference for CIOs and leaders of government agencies, as well as hi-tech and telecom business and service suppliers and technology investors around the world.

Social insurance penalties get teeth

Firms which delay or turn their backs on paying social insurance will incur severer sanctions.

This will be the reality if the amended Social Insurance Law comes into force.

Vietnam Social Security reports have shown an alarming drop off in firms ignoring or delayed their obligations in paying social and health insurance for workers.

For instance, in southern Dong Nai province by May, 2013 unpaid social insurance amounted to VND338 billion ($16 million), more than double that in late 2012.

In northern Hoa Binh province, this figure leaped from VND13.6 billion ($648,000) in 2010 to around VND111 billion ($5.3 million) by May 2013, while in central Quang Binh province, unpaid amounts surged VND20 billion ($960,000) to VND94 billion ($4.5 million) after March and April.

Dong Nai Social Security deputy director Pham Minh Thanh said from 2007 until present his organisation brought several dozen violators to the court and won most cases, but debt collections have proven a tough task.

“In 2012, 28 disobedient firms were brought to the court. Their owed amounts exceeded VND28 billion ($1.3 million). The collected amount, however, was VND2.4 billion ($114,000), less than 10 per cent of the total,” Thanh said, adding that this had affected workers’ benefits.

“However, since sanction measures are not tough enough, firms deliberately appropriate payment amounts and accept fines of VND30 million ($1,400) maximum,” said Deputy Minister of Labour, Invalids and Social Affairs Pham Minh Huan.

Tran Thi Thuy Nga, head of Ministry of Labour, Invalids and Social Affairs’ (MoLISA) Social Insurance Department, said now was the time to get tough and its amended Social Insurance Draft Law could hike current interest rate (0.05 per cent, per month) levied on unpaid social insurance amounts.

Accordingly, it is proposed to triple the interest rate applied to investment activities involving social insurance funds and double the inter-bank interest rate.

Shippers leave others in their wake

The globe’s shipping leaders Maersk Line, MSC Mediterranean Shipping Company S.A and CMA CGM will establish an operational alliance.

According to Maersk Line, the three firms have in principle agreed to establish a long-term operational alliance on East – West trades, called the P3 Network. The aim is to improve and optimise operations and service offerings.

The P3 Network will operate a capacity of 2.6 million twenty-foot equivalent unit or TEU (initially 255 vessels on 29 loops) on three trade lanes including Asia – Europe, Trans-Pacific and Trans-Atlantic. While the P3 Network vessels will be operated independently by a joint vessel operating centre, the three lines will continue to have fully independent sales, marketing and customer service functions.

The P3 Network will provide customers with more stable, frequent and flexible services. Each of the lines will offer more weekly sailings in their combined network than they do individually. As an example, the P3 Network plans to offer 8 weekly sailings between Asia and Northern Europe. In addition the P3 Network will offer more direct ports of call.

The improved network is expected to reduce the disruptions for customers caused by cancelled sailings. In order to provide customers with a consistent service offering across the network, the lines will establish an independent joint vessel operating centre.

Declining volume growth and over-capacity in recent years have underlined the need to improve operations and efficiency in the industry. This has prompted the creation of other operational alliances such as G6 and CKYH. Using the P3 Network the lines expect to be able improve their efficiency through better utilisation of vessel capacity.

The lines intend to start operations in the 2nd quarter of 2014, but the starting date will be subject to obtaining the approval of relevant competition and other regulatory authorities. In addition, the establishment of the P3 Network is subject to the lines agreeing on definitive contracts. Finalisation and signing of the contracts is planned for the 4th quarter of this year.

The P3 Network will based on existing capacities of each member, initially operate a capacity of 2.6 million TEU (255 vessels)

Maersk Line will contribute with approximately 42 per cent of the capacity (including the new Triple-E ships), of about 1.1 million TEU. Maersk Line will continue to offer the Daily Maersk product to those customers requesting it.

MSC will contribute with approximately 34 per cent of the capacity, of about 0.9 million TEU of capacity.

CMA CGM will contribute with approximately 24 per cent of the capacity equaling 0.6 million TEU.

Vessels contributed to the P3 Network will continue to be owned and/or chartered by the lines.

Modern gantry crane put into operation in Hai Phong port

A system of four rubber-tyred gantry (RTG) cranes and a new container station have recently put into operation at the Tan Cang Dinh Vu (New Hai Phong Port in Dinh Vu) in the northern city of Hai Phong.

This upgrade is part of the port’s modernisation scheme to increase its capacity to meet the growing demand for cargo tranport and transform into an international standard container port in the near future.

With a total investment of 100 billion VND, the four RTG cranes manufactured by Japan's TCM Corporation were completed and put into operation along with anew 196, 250 square metre container station.

The new system will enable the port to manage container goods more effectively and increase its capacity from 10,000 to 12,000 TEUs.

Brokerages merge to avoid bankruptcy

Sacombank Securities Co (formerly listed as SBS on the HCM City Stock Exchange) is considering a merger with Phuong Nam Securities, according to a recent document released by Sacombank Securities.

From a company with a charter capital of over VND1 trillion (US$47.6 million), Sacombank Securities' accumulated losses as of last year were VND1.77 trillion ($84.2 million). The company delisted in March.

In April, its chairman Kieu Huu Dung announced it would merge with another company. Meanwhile Phuong Nam Securities deputy general director Phan Quoc Huynh became a general director of Sacombank Securities.

Vinatex divests shares in investment arm

The Viet Nam National Textile and Garment Group (Vinatex) will auction its 3.03 million shares in Vinatex Investment Company next Tuesday, according to the Ha Noi Stock Exchange.

Under the restructuring scheme of Vinatex, the Government requires the group to equitise between the 2013-15 period. Excluding the companies Vinatex owns outright, it will have to divest from 37 businesses.

Vinatex Investment Co has a charter capital of VND101 billion (US$4.8 million).

Construction firm reports profit in first half

Construction company Song Da No 9 (SD9) estimates its profit in the first six months of this year will reach VND17 billion (US$809,500).

The amount represents a decline of around 15 per cent compared to the same period last year.

It expects a revenue at VND837 billion ($39.8 million) and a profit at VND65 billion ($3 million) this year.

Government bond yields edge higher

Around VND200 billion (US$9.5 million) of two-year bonds issued by the Bank for Social Policy were sold yesterday, yielding 7.6 per cent, higher than the previous auction by 0.1 per cent.

The bank has raised over VND5.4 trillion ($257.1 million) through bonds since earlier this year.

On Thursday, bonds issued by the State Treasury were also bought at a value of VND3.25 trillion ($154.7 million), yielding between 6.68-7.65 per cent, higher than the previous auction by 0.15-0.35 per cent.

The State Treasury has raised VND91.67 trillion ($4.3 billion) through bonds since earlier this year.

Japan shares processing know-how

Japan's leading agricultural processing and sorting machine manufacturer Satake has announced plans to transfer its technology to a Vietnamese company.

The Japanese group will provide Viet Nam's An Giang Plant Protection Joint Stock Company (AGPPS) with equipment and technical assistance during the four processing stages of drying, polishing, assessing and managing rice quality.

Their co-operation agreement aims to help AGPPS independently manufacture modern dryers capable of producing germinated brown (GABA) rice. This rice variety's abundance of amino acids is beneficial to consumer health.

PC parts maker opens in VN

Global solution provider for PC accessories and PC cooling, Zalman Tech, has entered the Vietnamese market and named Tan Doanh Service and Trading Ltd Co as the sole local distributor.

Chris Kim, Southeast Asia sales manager of Zalman, said the South Korean-based company, which had focused on major markets like the EU, US and Japan last year realised the growth potential of Southeast Asian markets, including Viet Nam.

Zalman hopes to grab a 70 per cent market share of computer parts like cases, storage accessories, power supply units, cooling solutions, mouse and keyboard, and audio products in the country by next year.

US to provide cutting-edge tools

The US-based company National Instruments will work with Arizona State University to transform the standards of engineering education in Viet Nam by using the latest hands-on and experimental tools for research and teaching.

ASU's Ira A Fulton School of Engineering will collaborate with NI's office in Viet Nam through the Higher Engineering Education Alliance Programme (HEEAP).

HEEAP is administered by ASU in partnership with the Government of Viet Nam, the US Agency for International Development, Intel, Siemens, Cadence, Danaher Corporation and other industry partners.

HEEAP focuses on transforming theory-based engineering and technical vocational programmes by modernising higher education programmes and using hands-on instructional approaches.

VN, S Korea look for IT connection

Executives from 40 Vietnamese companies met with their counterparts from 10 Korean firms to explore co-operation in IT and mobile technology in HCM City yesterday.

The Koreans arrived as part of a Trade Mission to Viet Nam from June 17 to 22.

The mission is organised annually by Daegu Technopark Mobile Technology Convergence Centre, and visits Ha Noi and HCM City.

The meeting was followed by the signing of an MoU between the HCM City Computer Association and the centre to foster business ties between the two countries in the areas of IT, mobility and data communication.

Intel unveils 4G core processors

Intel Viet Nam yesterday officially announced the launch of its latest series of core processors.

The 4th generation Intel Core processors can bring a 50 per cent improvement in battery life in active workloads over the previous generations.

The core processor also has two to three times better standby battery life, according to David McCloskey, Intel Asia-Pacific director of product marketing and business operations.

This is the largest generation-over-generation gain in the company's history, enabling over nine hours of battery life in active workloads for some Ultrabooks based on the new processors.

The new chips also offer significant improvements in integrated graphics performance, offering consumers a better gaming experience, he said.

The new processors are the first SoCs (system on chip) for PCs with stunning performance and power for a variety of innovative devices, including Ultrabook, 2-in-1 and portable all-in-one designs.

"We made one of the most seismic changes to our road map ever when we built these new core processors," said McCloseky.

Derivatives essential for ensuring progress in volatile bond markets

There are virtually no derivatives in the Vietnamese bond market, says Vietnam Bond Market Association general secretary Do Ngoc Quynh.

Derivatives include four main instruments: forward contracts, swap agreements, futures contracts and option contracts.

Quynh told a conference in Ha Noi that while derivatives were connected with the development of the bond market, there were few derivative instruments in Viet Nam.

Quynh said the scale of the local bond market was relatively small and liquidity focused on bonds with maturities of less than three years.

"At the same time, because derivatives are not applied, investors have no hedging products when the market is volatile."

In the Vietnamese market, investors often bought debt instruments with floating rates and the transactions took place in the short term, Quynh said.

"Consequently, they face two major risks of interest rate and exchange rate."

Quynh backed Viet Nam's plans for derivative products and recommended the legal system for bonds and derivatives.

"I hope with the Government's restructuring proposals for the stock market, investors will invest in bonds for the long term," he said.

After more than 10 years, derivatives were still in an infant stage, but the benefits to the economy were very promising, he said.

Most derivatives were currently on off-exchange trading. Participants in the market were mostly foreign banks, large domestic banks and foreign-invested companies.

Meanwhile, derivatives were essential for businesses, especially exporters who suffered from price fluctuation risks.

For banks, derivatives helped diversify products to satisfy customer needs, thereby improving operational efficiency.

The draft decree on derivatives was expected to be finished by the end of this year.

Ha Noi encourages citizens to get online

Ha Noi will attempt to raise the percentage of broadband internet subscribers to 25 per cent of the population and the rate of mobile phone ownership to 212 devices per 100 people by 2020.

The director of the Ha Noi Department of Information and Communications, To Van Dong, annonced this at a conference to highlight the city's plans to develop posts and telecommunications in the capital up to 2020.

Dong said that the total investment needed to implement the plan was estimated at VND7.884 trillion (US$378.4 million), coming from the State budget as well as the private sector.

According to the plan, Ha Noi will apply advanced telecommunications technologies to provide reliable 3G and 4G services.

By 2020, Ha Noi will have 80-90 per cent of the city centre's telecoms cables and 50-60 per cent of all suburban cables laid underground to improve the city's landscape.

Dong added that the department was working with the Viet Nam Posts and Telecommunications Group (VNPT) to create a number of public Wi-Fi hotspots in places of interest across the city in the near future to service the demands of tourists.

Shipping lines form alliance to facilitate global trade

Maersk Line, the MSC Mediterranean Shipping Company and CMA CGM, have agreed to establish a long-term operational alliance on East-West trade called the P3 Network.

The aim is to improve and optimise operations and service offerings.

The P3 Network will serve three trade lanes: Asia-Europe, Trans-Pacific and Trans-Atlantic.

The P3 Network vessels will take part in a joint vessel-operating centre. But the three lines will continue to have fully independent sales, marketing and customer service functions.

Each of the lines will offer more weekly sailings in their combined network than they now do individually.

For example, the P3 Network plans to offer eight weekly sailings between Asia and Northern Europe. In addition, it will offer more direct ports of call.

The improved network is expected to reduce the disruptions for customers caused by cancelled sailings.

The lines intend to start operation in the second quarter of 2014, but the starting date will be subject to approval from authorities. Signing of the contracts is planned for the fourth quarter of this year.

The P3 Network will be based on the existing capacities of each member, and initially have a capacity of 2.6 million TEU (255 vessels).

Maersk Line will contribute approximately 42 per cent of the capacity (including the new Triple-E ships), of about 1.1 million TEU. It will continue to offer the Daily Maersk product to customers requesting it.

MSC will contribute about 34 per cent of the capacity, of about 0.9 million TEU.

CMA CGM will contribute about 24 per cent of the capacity equaling 0.6 million TEU.

All vessels used in the network will continue to be owned or chartered by the lines.

Fertiliser imports continue to grow

Imports of fertilisers increased in the first five months of the year to 1.5 million tonnes totalling US$622 million, up 32 per cent and 21 per cent, respectively over the same period last year.

Last month alone, the country imported 438,000 tonnes worth $180 million, increasing 438 per cent in quantity over the previous month.

Customs statistics show that in the first five months, sulphate of ammonium fertiliser imports hit 404,000 tonnes, the highest category, accounting for 26 per cent of the total, increasing 9.6 per cent.

Last month alone, 377,000 tonnes were imported, increasing 26 per cent over the same month last year.

Kali fertiliser imports ranked second with 313,000 tonnes last month, up 240 per cent over the previous month, bringing its total import in the five-month period to 377,000 tonnes.

DAP (di-ammonium phosphate) fertiliser followed with an import quantity of 327,000 tonnes, a 76.5 per cent rise over the same period last year.

Ministry examines e-commerce

Viet Nam is in the process of completing a legal framework for the regulation of e-commerce, which is becoming increasingly popular as technology and the internet boom.

The statement was made by Deputy Minister of Industry and Trade Tran Tuan Anh at a press conference held in the capital yesterday.

E-commerce is the conducting of buying and selling products or services via electronic systems connected to the internet or telecoms networks.

Anh said that the growth of e-commerce was an inevitable trend in the current age of internet technology and, therefore, sufficient regulations to govern it must be enforced without delay. He argued that the lack of a legal framework had already hindered the development of the market and the competitiveness of enterprises.

According to Tran Huu Linh, director of the ministry's E-commerce and Information Technology Agency, Viet Nam is estimated to have around 120 million active mobile phones and 34 million internet users, while the growth rate of 3G users is expected to rise 20 per cent per year. This market provides perfect conditions for e-commerce to thrive.

The ministry expected to complete the legal framework before the end of the year, with soon-to-be-released circulars providing guidance about regulations and information about the punishment for trade violations, he said.

Linh also pointed out that e-commerce, which is borderless and available 24/7, was a good tool to aid the operation and expansion of enterprises, as well as improving customer access, reducing costs and increasing profits.

The ministry said the e-commerce operations would be subject to tight management. Accordingly, the registry of websites, changes of registered information and operation reports must be submitted to the ministry via www.online.gov.vn as of July 1.

Additionally, the credit of websites will be rated to create consumer trust, and violators will be named and shamed online.

The decree will also provide regulations about the security requirements of customer profiles and transactions.

Linh stated that informal statistics showed there are about 100,000 websites in Viet Nam, two thirds of which were for selling products or services.

Fisheries exhibition expected to promote domestic exports

More than 160 companies and organisations will take part in the Viet Nam International Fisheries Exhibition, or Vietfish 2013, to be held from June 25-27 at the Sai Gon Exhibition and Convention Centre in District 7.

Vietfish, a leading aquaculture exhibition in Southeast Asia, will feature 230 booths displaying products and services such as fresh, frozen, dried and salted fish and shrimp as well as processing equipment, machinery and other items.

During the event, a seminar on Japan's market trends and import regulations will be held by the Viet Nam Trade Promotion Agency and the Viet Nam Association of Seafood Producers (VASEP). Other seminars on hot topics related to the seafood industry will also be organised.

VASEP said that one of its main goals was to promote Vietnamese seafood brands in the world market.

The event would also offer opportunities for businesses to exchange information and learn about market and customer trends, new products and new technologies, said Truong Dinh Hoe, VASEP general secretary.

Many international organisations and media agencies, including the Canadian Trade Commission, Sweden Trade Commission, Asian Aquaculture Network, Global Aquaculture Alliance and a delegate of Japan journalists have registered to take part in the expo.

Hoe said that seafood firms were facing several problems, including a shortage of raw materials, a drop in overseas demand, disease outbreaks among shrimp and trade barriers that have resulted in anti-dumping and anti-subsidy lawsuits.

Exports had fallen significantly in the first quarter of the year due to a drop in global demand, said To Thi Tuong Lan, VASEP deputy general secretary.

Exports, however, showed signs of recovery in April, with an increase of 2 per cent over the same period last year, she said.

Seafood export revenue is estimated to reach nearly US$3 billion in the first half of this year, Hoe said.

The seafood industry would likely meet the export target set for this year of $6.5 billion if the rest of the year presented advantageous conditions, Hoe said.

SAV looks for overseas assistance

The State Audit of Viet Nam (SAV) yesterday called for more support from development partners to implement its Action Plan, part of its Strategy to 2020.

Speaking at a co-operation workshop, Auditor General Nguyen Huu Van said that over the past 19 years, the organisation had affirmed its role in Government management.

Audit results had been used in planning, policymaking and in the management of public finances, budget and assets, he said.

SAV has been planned to become more prestigious and modern with qualified professional capacity.

Thus it had collaborated with the UK Department for International Development (DFID) to launch an action plan to implement the State Audit development strategy to 2020, he said.

The plan focuses on a legal framework for its operation; organisation structure and management of human resources; audit planning, methodology and management; information technology application; and international co-operation.

With that in mind, SAV needed more technical and financial assistance from international donors and would commit to using aid finance effectively and complying with agreements, Van said.

World Bank Viet Nam country director Victoria Kwakwa said the bank had focused on improving SAV's auditing capacity and its use of resources, especially human resouces.

European Commission Delegation programme officer Sion Morton said the EU had agreed in principle to a 4 million euro (US$5.3 million) project to implement the action plan.

He said the project was aimed at building capacity through staff development and the enhancement of audit quality and management.

Specifically, it would help restructure SAV's organisation, train staff and apply information technology in auditing and management.

The project was scheduled to start in the first half of next year and the final decision by the EU was expected to be issued in September this year.

Morton said he hoped for more dialogue among development partners to avoid overlapping.

SOE reforms stepped up, snags remain

Viet Nam's ministries and agencies have put more effort into promoting the progress of State-owned enterprise (SOE) renovation and development.

This direction was presented in a recently issued conclusion by Deputy Prime Minister Vu Van Ninh after a last month meeting of the Steering Committee on Corporate Renovation and Development.

The committee and relevant authorities helped the Prime Minister direct the arrangement, renovation and improvement of SOEs' effectiveness, which have gained considerable achievements during last year and the first five months of 2013.

It proposed to the Prime Minister 28 projects on the corporate renovation policies, taking account of 78 percent of the 2012 plan and 50 percent of this year's plan.

The Prime Minister approved 99 of the 101 initiatives on the SOE arrangement and renovation of ministries, agencies and localities in the 2011-15 period, and passed 17 of 21 projects on the restructuring of State-owned corporations and groups. In addition to the achieved results, the conclusion also pointed out the drawbacks of SOE rearrangement, renovation and restructuring such as slow progress in issuing policies and mechanism, limited results in implementing SOE renovation projects and difficulties in withdrawing capital.

During its meeting, the Steering Committee also specifies the plans and tasks of ministries and agencies for the final months of this year.

In the coming time, it will focus on completing the policies and mechanism for SOE rearrangement, renovation and restructuring, aiming to accomplish the plans approved by the Government and the Prime Minister promptly.

Oil refinery performs well in first six months

The country's first oil refinery, Dung Quat, has sold more than 3.1 million tonnes of products so far this year, surpassing its targeted revenue.

Nguyen Hoai Giang, chairman of the Binh Son Refinery and Petrochemical Co Ltd (BSR), said the company continued to process crude oil and expand the scale of its oil refinery.

This year, Dung Quat oil refinery is expected to make a profit of VND2.1 trillion (US$100 million).

Companies to get support from eco-consulting centre

Eight small- and medium-sized enterprises in HCM City will be chosen to receive eco-business consulting services from the ASEM Eco-Innovation Consulting Project for SMEs, according to the ASEM SMEs Eco-Innovation Center (ASEIC).

Sponsored by ASEIC, the project aims to strengthen the green competitiveness of SMEs in ASEM-member countries, especially in developing countries, by disseminating and utilising green management and technology in their business,

In 2011, ASEIC launched its first ASEM SMEs Eco-Innovation Consulting Project for 33 SMEs in Thailand, Indonesia, Malaysia and Viet Nam. Last year, ASEIC offered consulting services for 32 different SMEs in those four countries.

This year, 40 SMEs in five ASEM-member countries, with new participation from the Philippines, are expected to benefit from the programme, according to Hyun Ae An, manager of ASEIC's Green Business and Technology Support Department.

An said that 16 SMEs in northern Viet Nam, which took part in the project in 2011 and 2012, had improved their environmental awareness as well as production efficiency.

"This year is the first time the project was implemented in the south, from June to October," she said. "As of today, more than 30 SMEs have registered to take part in the project, but we will choose eight firms to provide specific consulting services."

Byung Seok Min, principal consultant at Nemo Innovation Consulting Group, noted that enterprises must begin to produce products that meet consumer demand in terms of price, quality and services.

Better technology, more value-added products, and improved working environments were necessary, he said, adding that competitiveness needed to be enhanced.

Under ASEIC's consulting process, after selecting eligible SMEs for the programme, ASEIC in collaboration with the Small and Medium Enterprises Development Support Centre 2 in HCM City will assess the environmental performance of the participating SMEs.

Based on the assessment, both short- and long-term environmental management and cleaner production strategies will be established, he said.

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