India’s northeast seeks to bolster ties with CLMV

Vietnamese Ambassador to India Ton Sinh Thanh

A business summit between India’s northeastern region and Cambodia, Laos, Myanmar and Vietnam (CLMV) has taken place in Guwahati city of the Indian state of Assam, focusing on higher education and herbal health sector. 

The event on March 24-25 was held by the Ministry of Commerce and Industry, the Services Export Promotion Council, and the International Chamber for Service Industry of India. It drew representatives of some ministries, sectors and universities in India, officials of eight northeastern states, CLMV diplomats, and businesspersons.

Ravi Kappor, vice secretary of Assam state’s administration, emphasised the role of India’s northeastern region, including Assam, in his country’s Act East policy.

He highlighted advantages of this region, such as a shorter travel time to Southeast Asia, including CLMV, by both road and air. He believed that the northeast of India and CLMV can cooperate in multiple aspects, especially aviation, tourism, manpower training, and health care.

Notably, the region is home to a number of universities providing courses in English, and therefore, they can be destinations for CLMV students, he said.

At the summit, Vietnamese Ambassador to India Ton Sinh Thanh said aside from the close proximity, India’s northeast and CLMV share many cultural similarities. They are also prioritised by both the Association of Southeast Asian Nations (ASEAN) and India. While ASEAN had programmes to narrow the development gap between CLMV and other member countries, India launched a big programme to develop the northeast.

India has also had activities to promote cooperation with CLMV such as a credit package of 1 billion USD for projects on digital connectivity with India and a project development fund to assist Indian investment in CLMV, Thanh said, considering them as favourable conditions.

However, to tap into the potential for tourism, education, IT and healthcare cooperation, both sides need to speed up road connectivity projects, encourage airlines to open direct flight routes, and increase promotion activities in the two regions, he added.

Jetstar launches new low-cost flight from Da Nang to Hong Kong

The 180-seat Airbus A320 of Jetstar Pacific en route from Da Nang landed in Hong Kong (China) on March 27, marking a new connection between the central resort city and the Chinese territory.

The new service was launched with the hope to meet rising travel demand between Hong Kong and central Vietnam. It is the third international route by Jetstar Pacific and Jetstar Group from Da Nang to foreign cities after those connecting Da Nang with Taipei (China) and Singapore.

According to the low-cost carrier, it will operate three flights per week on Monday, Tuesday and Friday with tickets sold from only 290,000 VND (12.7 USD) per flight. Each flight takes about 1 hour and 45 minutes.

Flight from Da Nang is scheduled to take off at 10:10 while that from Hong Kong will return to the central city at 14:05.

The number of international tourist arrivals to Da Nang has been on the rise in recent years. In 2016, the city welcomed 1.7 million visitors, an increase of 31.6 percent from a year earlier.

Cathay Dragon and Hongkong Express have also operated their services from Da Nang to Hong Kong with 7 flights and 3 flights per week, respectively.

Vinacomin must shape up: Deputy PM

Deputy Prime Minister Vuong Dinh Hue has asked ministries to supervise operations of Vietnam National Coal and Mineral Group (Vinacomin) after its poor production and business performance in 2015-16, according to Government portal chinhphu.vn.

Vinacomin’s business performance in the 2015-16 period declined compared to the previous years, as was evident in its various inefficient investment projects and fruitless calls for investment activities, according to the finance ministry’s financial monitoring report.

Hue has assigned the ministries of industry and trade, natural resources and environment and finance to strengthen supervision and tightly monitor the operations of Vinacomin, besides addressing its problems and petitions.

Vinacomin has been asked to complete its reports on subsidiaries’ arrangements, business performance evaluation, investment mobilising activities, corporate governance and restructuring orientation and submit it to the industry and trade ministry.

Concerning coal price negotiations for electricity and fertiliser production, the finance ministry has been asked to continue reviewing and analysing the input cost factors for coal production and consumption so as to determine the consultative prices, and submit a report to the Prime Minister before March 30.

The coal industry is significantly important to the economic development of the country in general and the northern province of Quang Ninh in particular, Hue said, adding that sustainable development of Vinacomin will help boost economic growth, ensuring energy security, social security and environmental protection.

Vinacomin’s revenue in 2015 decreased by around 2 trillion VND (88 million USD) compared to 2014, the finance ministry had earlier reported. Its pre-tax and after-tax profit decreased by 70.2 percent and 80 percent to around 840 billion VND and 430 billion VND, respectively.

In the first nine months of 2016, the group recorded a net loss of 73.7 billion VND from business activities, much higher than the previous year’s estimate of 4.5 billion VND. However, the total amount spent on bonuses in 2015 was over 550 million VND, which was divided among 16 managers of the corporation.

Vietnam’s import tracking raises concern amid Brazil meat scandal

While Vietnam has claimed that none of its meat imports are from 21 scandal-hit companies in Brazil, local consumers still face the risk of unsafe meat thanks to the country’s loose tracking of animal imports.

The Animal Health Department under Vietnam’s Ministry of Agriculture and Rural Development has said that the country has never imported meat from any of the 21 meat processing companies being investigated for alleged bribery in Brazil.

The Brazilian companies are purported to have bribed government health officials to forego inspections and ignore abuses, sparking fears about the quality of their meat.

Despite claims to the contrary from the animal health watchdog, it has been discovered that the relevant Vietnamese agencies do not closely monitor imported meats once they have cleared customs.

To complicate the matter, while customs data shows that Vietnam has imported meat from Brazil, many local food companies and supermarkets deny using or selling products from the South American country.

Even the chief official of the Animal Health Department, Pham Van Dong, admitted that it is impossible to know where the imported meat has gone after its customs clearance.

In an interview with Tuoi Tre (Youth) newspaper, Dong said no inspection was requested into meat imports into Vietnam before March 23, when the scandal broke out, as it has been confirmed that “Vietnam’s meat imports from Brazil did not include products from the 21 affected companies.”

Vietnam imported some 1,800 metric tons of chicken meat from Brazil in the first two months of this year, according to the department’s data.

Despite this, no Brazilian chicken meat has ever been found publicly on sale in stores or supermarkets across the country.

Asked about the mysterious path of the imported meat, Dong said without delay, “how can we know where the meat goes?”

“We are only responsible for checking if a batch qualifies for import, and that’s all,” he told Tuoi Tre.

“After customs clearance, the meat may go to an industrial park, or anywhere, who knows?”

Dong said that his department kept a close eye on imported meat before allowing it to clear customs, with officials taking samples from 100% of its imports for quarantine and quality testing.

Vietnamese meat suppliers and processors have long warned of the dubious quality of imported meat, especially those available at dirt cheap prices.

According to customs data, imports of fresh pork and cattle meat from Brazil have average prices ranging from only US$1 to US$4 a kg.

Chicken wings, heads and feet have also been imported into Vietnam from VND7,000 (US$0.31) to VND9,000 (US$0.4) a kg, which local meat companies say are unreasonably cheap prices.

Tuoi Tre brought forward those concerns to Dong, and he repeated that pricing is not something his department was responsible for.

“We check all meat imports before they enter Vietnam, but how they are priced is the job of individual businesses,” he said.

Kevin Tho, director of THO Co. Ltd., a Ho Chi Minh City-based meat importer, said Brazilian meat is normally used by businesses in the HoReCa sector, (hotels, restaurants and cafés) instead of selling directly to consumers in retail outlets.

Tho also expressed his concern over Vietnam’s lax requirements on slaughtering dates.

Vietnam does not set any standard on the allowed period from slaughtering to the consumption of frozen meat, according to the director.

This means the expiry date of imported meat is only calculated from the time it is deep-frozen, even if it has been slaughtered months before, Tho said.    

Noodle firm earnings plunge

Colusa-Miliket Foodstuff Joint Stock Company’s (Miliket) audited financial report for 2016 showed a 40% drop in pre-tax earnings compared with the previous year, indicating a loss of market share.

The report showed revenue of VND461 billion (USUS$20.7 million) and pre-tax earnings of VND25 billion (US$1.12 million), declining by 3.5% and 39%, respectively, from 2015, and currently the lowest since 2012.

The noodle company’s market share reduced to only 2-4% in total.

In 2016, despite the company’s effort to introduce a new line of products with better packaging and another line with flavour diversity, it failed to attract customers and accumulated 15% more inactive stock compared with 2015.

The stock of VND23.3 billion (US$1.04 million) caused the company’s liabilities to increase from VND61.1 billion (US$2.74 million) to VND72.8 billion (US$3.27 million).

In total, Miliket’s total capital in 2016 was VND196 billion (US$8.8 million), with cash flow of VND122.3 billion (US$5.5 million).

According to financial experts, the company will soon be depleted of cash if it fails to increase quantity consumed.

At present, Miliket’s instant noodles is in the lowest price bracket on the market, at VND3,000 (US$0.13) per package. This allows the company to focus on low income customers and cheap restaurant chains, both market segments neglected by larger companies.

Miliket is one among several large noodle producers on the scene in Vietnam today facing challenges. Other brands such as Acecook, Masan and Asia Food are also facing problems generating revenue.

Although Acecook holds nearly 50% of domestic market share, it experienced continuous drop in earnings between 2013 and 2015, whereas Masan’s 2016 revenue dropped by 20% from the previous year.

According to the World Instant Noodles Association, the amount of instant noodles consumed annually in Vietnam has gradually declined since 2013, from 5.2 billion packages to 4.8 billion in 2015. The country has the fourth largest quantity of instant noodles consumed per annum. 

Exporters savour confectioneries

Confectionery, one of the fastest growing foodstuff exports in Vietnam, is receiving more investments from manufacturers.

Bibica Corporation, one of Vietnam’s largest confectionery makers and exporters, is developing a cupcake production line valued at VND277 billion (US$12.18 million) and shifting machinery from its Hanoi factory to a new facility in the neighbouring Hung Yen province.

Bibica has also invested VND74.7 billion (US$3.28 million) to produce soft candy and VND15.4 billion (US$677,600) for making round cakes.

Another big firm, HaiHa Confectionery JSC is also developing a new candy and biscuit factory in northern Bac Ninh province with a total daily output of 61.58 tonnes.

Meanwhile, the local confectionery industry is also eyed by foreign firms. The Association of the German Confectionery Industry deems Vietnam as a potential partner.

Nguyen Trung Chinh, a representative from Global Hotels Management (GHM), said that Vietnam’s confectionery industry is in the spotlight for foreign investors. GHM will hold the world’s leading trade fair for bakery, confectionery, and snacks in September 2018.

“Our general director Dieter Dohr will visit Vietnam next month to seek collaboration with Vietnamese manufacturers and exporters,” Chinh said.

Many global brands such as Orion, Nestle, and Mondelez have secured a firm foothold in the Vietnamese market. As reported by Pulse-news, the Republic of Korea’s confectionary giant Orion Corp. is accelerating its foray into the Southeast Asian snack market as sales of its Vietnam confections exceeded 200 billion won (US$174.5 million) in 2016.

According to Orion, its Vietnam operation’s sales for 2016 jumped 24.1% year-on-year.

A report by London-based market survey firm Business Monitor International indicated that Vietnam’s confectionery industry maintains a health and steady growth with sales of confectioneries estimated to reach VND40 trillion (US$1.76 billion) by 2018.

The industry promises ample growth opportunities thanks to the current low consumption of three kilogrammes per capita, per year.

The Ministry of Industry and Trade reported that total Vietnamese confectionery exports grew 15% in 2016, of which candy and grain products contributed VND11.7 trillion (US$532 million). Most confectionery products were exported to the US, Chinese, and Cambodian markets in 2016.

Other important recipients of Vietnamese confectioneries were Japan and the Republic of Korea.

According to Bibica, Vietnam’s confectionery industry is recording a double-digit sales growth in major export markets. Among them, China will be a major importer of Vietnamese confectionery products in the next few years as it increases its stock by 40%. 

However, in recent years, Vietnam has also seen a rise in imported confectioneries, especially high-end brands. It is estimated that imports of confectionery products account for 30% of the overall snack market. In 2016, Vietnam spent around US$250 million on foreign produced confectioneries, up 20% year-on-year.

According to a representative from Mondelez Kinh Do, in this new landscape, Vietnam’s confectionery market becomes more competitive for both local and foreign confectioners.

The intensifying competition will force firms to invest in new technology and develop new products to meet diverse demands. 

Tra fish exports to Brazil up 17.2%

Tra fish exports to Brazil soared by 17.2% to US$12.1 million in the first month of this year, according to the Vietnam Association of Seafood Exporters and Producers (Vasep).

If the next few months are on an upward trajectory, the South American nation will overtake ASEAN to become the fourth largest importers of Vietnam tra fish behind the US, EU, Hong Kong (China).

Tra fish exporters to Brazil said high-quality tra fish products can have easier access to the increasingly lucrative market that imposes rigid quality requirements.

To boost exports to this market, Vietnamese businesses must be subject to stringent criteria under technical barriers and as a result, their tra fish products are able to compete with other white meat fish fillets in Brazil.

According to the statistics of the International Trade Centre (ICT), Vietnam and Argentina are the two major suppliers of white meat fish fillets for Brazil at present.

Quang Nam holds conference promoting investment

The central province of Quang Nam held a conference on March 26, calling for investments in the automobile support industry, garment-textile, and entertainment services in coastal areas, hi-tech agriculture, and pharmaceutical industry.

Addressing the event, Prime Minister Nguyen Xuan Phuc said Quang Nam has its own natural advantages to attract investors, such as favourable geography, rich forest and marine resources, and good infrastructure. 

The province has successfully lured 4.5 million tourists per year, nearly 70% of whom are foreigners. The figure could be 10 or 15 times higher if the locality works to promote tourism and build its brand name, he said.

He evaluated that the local business environment has become more attractive and stood in the country’s top list.

The PM asked local authorities to put forth more policies to draw big and highly-competitive businesses.

To obtain sustainable development, Quang Nam needs to diversify its budget collection, arrange population appropriately, and improve the efficiency of infrastructure investments, while making effective use of rivers, and have long-term vision and planning schemes, he suggested.

Additionally, the province should improve infrastructure quality so as to connect with other neighbours, like Danang and Quang Ngai, he said.

He and other officials witnessed the hand-over of investment certificates and decisions as well as banks’ investment credit pledges to projects, totaling around US$15.8 billion.  

The same day, the PM attended a ceremony to launch the public administrative and investment promotion centre in Quang Nam, the second of its kind nationwide, after the first pilot one in the northern province of Quang Ninh.

He later participated in a ceremony to kick-start the construction of the THACO-Mazda automobile manufacturing plant at Chu Lai Open Economic Zone in Nui Thanh district.

The project worth VND12 trillion (equivalent to US$520 million) is expected to be put into operation in April 2018 with a designed capacity of 100,000 cars per year.

The PM said the Government will create all favourable conditions to develop the automobile support industry.

He also took part in a ceremony to commence the building of a Vinpearl tourism resort complex in Thang Binh district.

Quang Nam has so far attracted 126 foreign direct investment (FDI) projects capitalized at nearly US$5.5 billion. In 2016, the province granted new investment licenses to 17 FDI projects worth around US$122.8 million. 

Vietnam continues to be an attractive investment destination

Vietnam gained a record US$15.8 billion in foreign investment in 2016 thanks to its improved investment and business environment.

This year, Vietnam expects to continue to be an attractive destination for foreign investors due to new opportunities from international economic integration and government incentives.

In the first two months of this year, Vietnam earned US$3.4 billion from 1,100 new and existing foreign-invested projects. 

Disbursement has reached US$1.55 billion, according to the Foreign Investment Agency’s latest statistics.

Ryu Hang Ha, President of the Korean Enterprise Association in Vietnam (Korcham), highly valued Vietnam’s strong reforms in its business environment and deeper integration into the global economy. These are fundamental factors for Vietnam to attract FDI, he said.

“Over the years, Vietnam has maintained sustainable economic growth. The government has reformed the economic structure and administrative procedures, and taken strong actions to combat corruption to create a more favorable environment for businesses. Vietnam is the Asian country that has joined the most free trade agreements, thus gaining enterprises in Vietnam the lowest tariffs,” Ryu elabrorated.

Despite the negative impact of the US’s withdrawal from the Trans-Pacific Partnership (TPP), the Vietnamese economy still has many cooperation and investment opportunities from the 16 free trade deals it has been negotiating.

Sebastian Eckardt, a World Bank economist, said Vietnam is taking steady steps through changing policies, creating a healthy investment environment and setting up sustainable economic development areas.

Vietnam has clarified the direction of economic development, focusing on effective use of FDI resources to make breakthrough changes, said Sebastian.

The Vietnamese government has created specific policies to increase national competitiveness by 2020, including the enactment of the revised Investment Law on January 1st, 2017. 

FTA brightens prospects of Vietnamese footwear products

Prospects are bright for Vietnam’s footwear exports after the EU-Vietnam Free Trade Agreement comes into force in 2018.

Diep Thanh Kiet, vice chairman of the Vietnam Leather, Footwear, and Handbags Association (Lefaso), said that a 0 per cent tariff rate will be applied to around 50 types of Vietnamese-made footwear products exported to Europe. In this new landscape, Vietnam’s footwear export turnover to Europe is predicted to grow significantly in 2019.

Export tariffs for footwear code 6402 footwear with rubber or plastic outer soles and uppers will be slashed to 0 per cent, while half of footwear with leather uppers, code 6403, will enjoy tariff exemptions following the free trade agreement (FTA). The tariffs on other footwear types will gradually be reduced to 0 per cent in the next three to five years. 

In addition, the EU has offered unilateral preferential treatment to a large number of commodities originating from Vietnam under the Generalised System of Preferences (GSP). “This scheme, coupled with tariff reductions brought by the FTA, will help Vietnamese footwear become more competitive than Chinese products in the EU,” Kiet said.

According to Bill Watson, managing director of Coats Vietnam, the EU has established trade agreements with South Korea and Japan. After these agreements were put into place, their exports to the EU increased dramatically.

He stated that the EU-Vietnam Free Trade Agreement (EVFTA) will be a major driver for Vietnam’s footwear sector in the next five years. Sportswear, in particular, is predicted to be the biggest mover due to becoming duty-free.

In fact, made-in-Vietnam brands have gained European customers’ trust. This, coupled with a low-cost base and improved infrastructure, will make Vietnam an ideal destination for foreign investors.

Watson said that more foreign footwear manufactures will relocate their businesses from China to Vietnam to enjoy the advantages of EVFTA. There are over 22 billion pairs of shoes produced in the world every year. Vietnam is the number two shoemaker, following China.

By proportion, every 1 per cent migration of footwear from China to Vietnam will help expand the Vietnamese footwear industry by 10 per cent.

Most recently, Italy supported Lefaso in setting up a footwear research and development centre in Vietnam by providing machinery, software, and Italian know-how.

The Italian Trade Commission has joined hands with the Italian Footwear Manufacturers’ Association to bring an international footwear exhibition in Vietnam. MICAM, scheduled to take place on September 17-20 at the Fiera Milano, is expected to promote collaboration between international footwear producers.

Lefaso’s Kiet said that given Italy’s fame for its high-end fashion industry and cutting-edge machinery the country is now home to 5,000 footwear companies and over 600 prestigious manufacturers Vietnamese shoemakers should look to Italian firms in securing firmer footholds in the European market.

He added, “The average price for Vietnamese shoes has increased over the past few years, to higher than that of China. In 2016, Vietnam spent $180 million to import Italian leather, which indicates that Vietnamese footwear exporters are climbing up the value chain. This trend is inevitable, as Vietnam is shifting its focus onto value.”

At a footwear and leather export promotion conference held in Ho Chi Minh City two weeks ago, Phan Chi Dung, director of the Light Industry Department under the Ministry of Industry and Trade (MoIT), said that  MoIT is drafting a master plan for the development of Vietnamese footwear to 2020, with a vision to 2025. According to the plan, Vietnam will produce two billion pairs of shoes by 2025, doubling the total output of 2016 and reaching an export turnover of $30 billion.

The footwear industry has a huge demand for raw and auxiliary materials. If the country’s supporting industries do not develop, the leather and footwear sector will be dependent on imported materials.

“Therefore, we encourage enterprises to build factories to produce leather, materials, and accessories in Vietnam. MoIT is considering proposing to the government setting up industrial zones specialised in producing raw materials for Vietnam’s leather and footwear sectors,” Dung said.

According to Dung, Vietnamese footwear products are exported to 50 countries and territories, with major markets like the US, the EU, China, and Japan. The production of leather and raw materials in Vietnam has reached a localisation rate of 40-50 per cent.

As of 2016, Vietnam’s footwear industry has 1,700 enterprises, including 800 large companies, which altogether employ more than 1.2 million workers. 80 per cent of the larger export enterprises are joint ventures or wholly foreign-owned.

Mercedes-Maybach range completed in Vietnam

Mercedes-Benz Vietnam (MBV) has officially launched two new variants Mercedes-Maybach S 400 4MATIC and Mercedes-Maybach S 500, completing the ultra-luxury Mercedes-Maybach range in Vietnam.

The launching was held at the annual press kick-off meeting 2017 at the riverfront villa Holm Residences. MBV said at the event that its outlook would be to focus on customer experience this year.

In 2015, MBV introduced the Mercedes-Maybach S 600 and immediately set a record of orders for an ultra-luxury car brand. Over the last two years, there have been nearly 100 Mercedes-Benz Maybach S 600 cars delivered to customers in Vietnam.

This shows great potential in the Ultra-Luxury Limousine segment and the warm welcome to the Mercedes-Maybach brand. Based on customer feedback, MBV recognizes that even in the ultra-luxury segment, the demands and tastes are diverse. Therefore, MBV decided to add the new Mercedes-Benz Maybach S 400 4MATIC and Mercedes-Maybach S 500 to the ultra-luxury line-up to satisfy more customers.

Compared to the Mercedes-Maybach S 600, the two new variants have no significant difference in terms of comfort and equipment to ensure the best experience for passengers. The most important change is in the engine spec (Bi-turbo V6 on the Mercedes-Maybach S 400 4MATIC and a Twin-turbo V8 on the Mercedes-Maybach S 500), which is already powerful and suitable for traffic conditions in Vietnam without affecting inside experience.

In terms of design, the Mercedes-Maybach S 400 4MATIC and the Mercedes-Maybach S 500 both own the overall length of 5,453 mm and the wheelbase of 3,365 mm similar to the Mercedes-Maybach S 600. The “double-M” logo is pinned on the C-pillar.

The only difference in the exterior lies at the wheel design, with the 19-inch multi single-spoke wheels on the Mercedes-Maybach S 400 4MATIC, and a stylish 20-inch multi twin-spoke wheels on the Mercedes-Maybach S 500.

The Mercedes-Maybach S 400 4MATIC and the Mercedes-Maybach S 500 will be priced at VND6.899 billion and VND10.999 billion respectively (VAT included). MBV continues to offer the flagship Mercedes-Maybach S 600 with the state-of-the-art technologies such as the smoothest V12 in the world or the MAGIC BODY CONTROL suspension at a price of VND14.169 billion.

Class B office buildings attractive to customers

Class B office buildings have taken the lead in the leasing office segment so far this year, according to real estate experts.

In Hanoi, the vacancy rate in Class B office space in Q1 increased significantly with the inaugural of the Horison building with a gross floor area of over 10,570 sq.m and usable area of more than 8,000 sq.m.  

In the coming months, the market will see more large projects including the DSD building with 20,000 sq.m, the Discovery Complex (49,000 sq.m), Truong Thinh Building (5,400 sq. m), and the HUD Tower (70,000 sq.m).

At the same time, the Class A office space segment saw a rise of 3.3 percent in renting price in the first quarter, with no new supply. 

class b office buildings attractive to customers hinh 0 Strong absorption rate in the Class A office space reflected the trend of moving for expansion among enterprises, as well as the high demand for large area of startup businesses and new representative offices.

Nguyen Bich Trang, Director of Hanoi office renting department under CBRE company, commented that high quality office buildings are always attractive to customers as they help the firms improve their brand image and attract high quality employees. 

Buildings with green and LEED (leadership in energy and environmental design) certificates are most popular among customers, she said, adding that the Horison building of Global Toserco is one example.

According to Deputy Director General of Global Toserco Ltd. Nguyen Thi Hong Van, with an advantageous location, 20% of the building’s total area has been booked at US$25 per square metre, mostly by firms in finance and banking. 

Green office buildings, which are environmentally friendly and energy-saving, have been introduced in Ho Chi Minh City, including Class A buildings of Deutches Haus and Mapletree Business Centre.

Border gate streamlines customs clearance for farm produce

Before being exported to China, samples of fruit are taken from this truck to check the remnants of pesticide. If there is no pesticide residue or epidemic found, certificates will be given to the exporter.

Previously, it took at least four hours for a truck to complete clearance at the border gate, but now the time has been cut by half.

Previously if any risk in a fruit sample was found, the sample would be sent to Hanoi for further inspection. Now time for this process has been cut thanks to a fast-track test which gives more accurate results.

During peak season, the number of fruit trucks across the Tan Thanh border gate can reach as many as 300 a day. Shortened customs clearance time has become a significant driving force for export and import activities.

Search for best Vietnamese entrepreneur gets underway

The latest search to find the best Vietnamese young entrepreneur has gotten underway in an initiative sponsored by the Saigon Hi-tech Park.

The initiative begins with a nationwide competition that is wide open to any high-tech project that involves the development of a new business or venture idea utilizing advanced technology.  

The Saigon Hi-tech Park has set up an investment fund that will award numerous cash prizes to five category winners, with US$4,500 (VND100 million) to the top winner. All five will receive assistance from the fund to develop their projects.

The investment fund for the winners is a very important part of the competition and will help young entrepreneurs to grow their businesses and create jobs throughout Vietnam, said representatives of the Saigon Hi-tech Park.

The support includes such things as marketing, management training, networking and one-to-one mentoring. Dozens of young entrepreneurs benefitted from these business supports last year, so the rewards are there for participants, as well as for the winners.

The reps noted the competition will help young Vietnamese entrepreneurs to take their high-tech business ventures to the next level, whatever stage their business is at.

For more information please visit http://iotstartup.vn/.

KIDO frozen food division announces IPO

KIDO Corporation (KDC) subsidiary Kido Frozen Foods JSC (KDF) has just announced its plan to hold its initial public offering (IPO) at the beginning of April.

On March 27, KDF will organize a roadshow to provide more information about the IPO after which KDC expects to possess 65 per cent of KDF’s chartered capital instead of the current 99.8 per cent.

In 2016, KDF transformed its operations from a limited liability company to a joint stock company.

KDF’s exponential growth in the recent years is expected to attract investors. In 2016, KDF's revenue reached $61.28 million, increasing 31 per cent on-year. Its before and after tax profits reached $7.72 million (+77 per cent) and $6.27 million (+85 per cent), respectively.

KDF was founded in July, 2003, a product of KDC’s acquisition of Wall's from Unilever. With this lucrative yet pressuring acquisition, KDF has inherited the international-standard ice cream manufacturing system, including the most modern ice cream factory in Southeast Asia. KDF has become the leader of the Vietnamese ice cream industry with a 35 per cent market share in 2016, with its flagship brands Merino and Celano, which take up 19 and 13 per cent, respectively.

Throughout its 14 years of operation, KDC has continuously raised its capital in KDF. In 2015, KDF elevated its chartered capital from $3.03 million to $7.72 million. In 2016, the figure was tripled to $24.57 million. KDC states that the recent major increase in chartered capital is meant to ensure the financial force for investment in new factories and keep the debt-to-equity ratio in check after it increased considerably in 2015.

KDF owns two factories: Cu Chi ice cream factory and Bac Ninh frozen food factory with a total designed capacity of 50 million litres per year, in which ice cream capacity is 25 million litres per year and yogurt capacity is 25 million litres per year.

KDF has started expanding its frozen food manufacturing facilities to approach more customers and focuses on upgrading its ice cream manufacturing system to reach international standards. 

Saigon’s parking lot owners say one-price regulation unfair

Parking lot owners in Ho Chi Minh City are screaming unfair at a city regulation limiting how much they can charge customers.

The regulation was introduced in January by the city’s administration in an attempt to control parking lots that previously forced customers to overpay.

Accordingly, prices for non-public parking lots are limited to VND4,000 (US$0.18) for parking during daytime --between 5:00 am and 9:00 pm, and VND5,000 ($0.22) for nighttime.

For cars, the respective limits are VND15,000 ($0.67) and VND30,000 ($1.34).

However, the one-price parking lot policy, applicable to both lots using modern technology and lots simply using poles and ropes, has been called unfair by local building developers.

Nguyen Phu Cuong, head of customer service at Pearl Plaza in Binh Thanh District, said the building has been going against the regulation by imposing higher parking fees and heavy surcharges for those who leave their vehicles overnight.

Cuong explained that such fees were introduced to discourage visitors not using the building’s services from taking up space in its already crowded lot.

The plaza currently has three basements floors for parking which mainly serve the 3,000 people who work in its offices, as well as customers who visit the attached shopping mall, cinema, and supermarket.

Prior to the introduction of higher fees, factory workers would park their motorbikes for the entire day in the plaza and take their company’s bus to work in the neighboring provinces of Dong Nai or Binh Duong, Cuong explained.

Some even went as far as leaving their vehicles for months on end, only to be charged with a few thousand dong under the city’s regulation, he added, forcing those who actually worked in the building to find parking elsewhere.

Similarly, the parking lot of Ho Chi Minh City’s iconic Bitexco Financial Tower in District 1 is also charging motorbikes VND5,000 ($0.45) per hour, while cars pay VND50,000 ($2.23) in the first two hours and an additional VND20,000 ($0.89) for each additional hour.

Nguyen Van Tien, an investor behind a parking garage in Tan Phu District said it cost an average of VND4 million ($179) for each square meter of parking in his lot.

At that price, a space large enough for one car costs VND100 million ($4,464), Tien said.

Under the current parking fee regulations, Tien said it would take forever for him to see any return on investment.

“Technically I’m allowed to charge customers higher than stipulated by the regulation, since my parking building does not fall under its scope of governance,” Tien said. “However, it would still take more than ten years to see a profit.”

Tien said the cost of investment on underground parking lots is more than two times that of parking garages, a discouraging statistic for developers.

Central Highlands gets huge investment

Domestic and foreign investors have registered to pour VND86 trillion (US$3.86 billion) into 25 projects in Central Highlands provinces between now and 2020, according to the Steering Committee for the Central Highlands.

Of which, Dak Lak is the largest recipient with 15 projects and VND83.9 trillion (US$3.76 billion).

Currently, four projects in Dak Lak province have received investment licences. Three of them are solar energy plants. 

They include a 2,000MW solar power plant with an investment of US$2.2 billion covering over 4,192 ha in Ea Sup district, a 500MW plant in Buon Don and Ea Sup districts with VND16.87 trillion (US$742 million) invested by the US’s AES Group and another with a capacity of 250MW also in Ea Sup district.

Over the past time, the region has issued a number of preferential mechanisms and policies as well as simplified administrative procedures to attract investors.

According to the Steering Committee, from 2011 to 2015, the total investment in the Central Highlands reached VND265.7 trillion (US$11.9 billion), double the amount of the 2006-2010 period.

The Central Highlands region includes five provinces – Dak Lak, Lam Dong, Gia Lai, Dak Nong and Kon Tum – with great potential for tourism and industrial trees like coffee and pepper.

Deputy PM urges for faster progress of Long Phu 1 power plant

Deputy Prime Minister Trinh Dinh Dung has urged the management board and contractors to accelerate the construction progress and ensure quality of the Long Phu 1 Thermal Power Plant.

During his field-trip to the project site in the Mekong delta province of Soc Trang on March 24, Dung also requested the relevant parties to ensure safety and security while executing the work and strictly implement the design and techniques.

Head of the management board Nguyen Doan Toan said the project is part of a cooperation programme signed between the Vietnam Oil and Gas Group (PetroVietnam) and a joint venture between the Power Machines and the Petroleum Technical Services Corporation (PTSC). 

deputy pm urges for faster progress of long phu 1 power plant hinh 0 The management board is striving to put the first turbine of the plant into operation in late 2018 and the second turbine one year later, Toan said. 

The Long Phu 1 Thermal Power Plant has a designed capacity of 1,200 MW. It is part of the Long Phu Power Centre, which comprises three thermal power plants with a combined capacity of 4,400 MW. 

Once operational, the plant will contribute to ensuring national energy security and economic restructuring in Soc Trang province and the southwest region.

Vietnam’s coffee price highest in six years

Coffee prices in Vietnam have reached the highest level in six years owing to the shortage of export-qualified beans after the harvest was hit by rains.

The price is in the range of VND46,500 (US$2.04) per kilo of robusta beans in the Central Highlands province of Lam Dong, and VND47,300 (US$2.08) per kilo in Dak Lak province.

This is the highest level since September 16, 2011, when prices climbed to VND47,400 per kilo.

First water shortage in dry season and then unseasonal rain in the Central Highlands from October to December last year has badly affected the 2016-17 crop harvest, both in terms of productivity and quality.

Vietnam’s coffee output from the current crop has fallen by 11% against the previous season, the International Coffee Organisation has reported. In 2016, 134,600 hectares of coffee trees in the region saw reduced output, while nearly 7,900 hectares of trees died or did not produce any coffee beans.

The Central Highlands region has 576,800 hectares of coffee trees, accounting for 89% of the country’s total coffee cultivation. Vietnam’s coffee accounts for one-fifth of the world coffee beans output.

It is currently dry season in the Central Highlands, and water shortage is a big problem. The Steering Committee for Central Highlands recently confirmed that water resources in the region will be able to supply sufficient water through irrigation projects, rivers, streams and wells to irrigate coffee cultivations until the end of the dry season.

Seminar on ‘Doing business in Vietnam’ held in Buenos Aires

The Vietnam Embassy in Argentina held a ‘Doing Business in Vietnam’ seminar on March 23 in Buenos Aires to promote commercial trade and introduce the country’s business climate.

Ambassador Nguyen Dinh Thao told representatives of the roughly 50 organizations that attended about the country’s economic growth over the past decade, noting that it has been one of the most robust in ASEAN.

The Ambassador also talked at length about legislative changes made by the Vietnam Government aimed at reducing red tape and streamlining governmental policies and procedures to make the business climate more conducive to the needs of foreign transnationals.

He noted that the Vietnam government has specifically targeted expanding trade with Argentina in the agriculture, telecommunications, energy and pharmacy segments of the economy.

Carlos Restaino, president of the Commission for Integration and Southern Common Market (Mercosur), in turn, spoke about the enormous potential for both cooperation in the public sector and collaboration in the private sector for the mutual benefit of both countries.

Vietnam, he underscored, is one of the high priority markets for Argentina and a gateway for transnationals from the South American country to gain market entry to the entire ASEAN region.