BUSINESS IN BRIEF 27/5
Forum discusses state of supporting industry
The practical experience of non-governmental organisations and businesses in developing the supporting industry was shared at the 10th Vietnam Supporting Industry Forum in Ho Chi Minh City on May 22.
Organised by the Reed Tradex company, in conjunction with the city’s Investment and Trade Promotion Centre and the Japan External Trade Organisation (JETRO), the event focused on the importance of developing partnerships to foster the development of the industry, which provides parts and components to manufacturers, in the future.
The forum helped Vietnamese manufacturers operating in the field to realise their weaknesses and ways to overcome them, thus setting new development targets and improving the quality of their products to meet the demand of investors.
According to Bui Quang Hai, Deputy President of the municipal Mechanics Association, the supporting industry plays an important role in attracting investors. He said that most Vietnamese producers have not satisfied investors’ requirements.
Reed Tradex Deputy Managing Director, Duangdej Yuaikwamdee said Vietnam’s supporting industry has a great opportunity to strengthen its development, suggesting that Vietnamese firms should pay attention to enhancing links in the field.
Denmark studies technology use by Vietnamese firms
The Central Institute for Economic Management (CIEM), in collaboration with the University of Copenhagen, organised a workshop on the draft report “Firm-level competitiveness and technology in Vietnam: Evidence from a survey in 2013” in Hanoi on May 22.
The survey is part of the “Research on the business sector” project in the 2013-2014 period funded by the Danish International Development Agency.
According to Prof. John Rand from the University of Copenhagen, the survey is the only tool studying the connection between technology and productivity in about 8,000 manufacturing enterprises in Vietnam. He suggested the enterprises develop their existing technologies in order to raise productivity.
Addressing the workshop, CIEM deputy director Nguyen Thi Tue Anh said that integration into the world market has forced Vietnamese firms to innovate technology to operate more effectively and increase their competitiveness.
However, the report, which is implemented by 300 investigators and 75 supervisors, points out that only a small number of businesses had carried out technology innovation due to difficulties in accessing capital sources.
Central Highlands urged to facilitate investment
The Office of the Central Highlands Steering Committee has been asked to focus on creating favourable conditions for foreign investment activities in the region’s provinces.
The request was made by General Tran Dai Quang, Politburo member, Minister of Public Security and head of the Central Highlands Steering Committee, at his working session with the office in Dak Lak province on May 24.
He was briefed on the region’s socio-economic development, defence-security and the office’s operations since the beginning of this year.
He directed the body to work with regional provinces to facilitate investment in transport infrastructure, especially in the Ho Chi Minh Highway, which runs through the Central Highlands. The route is expected to open to traffic by mid-2015.
Politburo member Quang also asked the offices of the steering committees for the Central Highlands and the northwestern region, as well as both regions’ provinces, to tackle the problem of unplanned migration.
He also requested that checks be regularly conducted at hydro-power projects in the Central Highlands and surrounding areas, and that the resettlement of people making way for project sites be carried out without delay.
Forest protection and management efforts also need to be intensified, he said.
In addition, Minister Quang stressed the importance of promoting socio-economic development, ensuring national security, maintaining social order and safety, facilitating sustainable development and attracting foreign and domestic investment to the Central Highlands.
January-April footwear exports increase by 26.4%
Vietnam’s footwear exports during the first four months of 2014 reached nearly US$3 billion, up 26.4% year on year, according to Lefaso, an association of footwear manufacturers.
Lefaso quoted a report by the General Department of Customs as saying that footwear shipments to the EU and the US, two of Vietnam’s biggest footwear markets, were valued at US$984 million and US$947 million, which represent respective rises of 26.7% and 26.5%.
The trade association said exports to a number of smaller markets, such as Chile and Israel, saw dramatic surges in the January to April period. These markets were up by 72.1% and 110.24% respectively when compared with a year earlier.
Footwear manufacturers attribute the sector’s impressive growth in the past few months to the GSP, a preferential tariff system that the EU has granted to Vietnam.
Steady economic recovery in the EU and the US, alongside the high quality of Vietnamese products, are two additional factors that boosted the consumption of Vietnamese footwear in these two markets.
Lefaso said the majority of manufacturers have received orders for delivery in June and July, while many even had orders for delivery in August and September.
US imposes anti-dumping tax on Vietnam’s steel pipe
The United States has levied duties on stainless steel pressure pipes imported from Malaysia, Thailand and Vietnam after finding the products had been sold at unfairly low prices.
Reuters reported that the US Department of Commerce decided to introduce duties as high as 167.1% for some products from Malaysia.
The pipe is used in pharmaceutical lines, petrochemical lines, brewery process and transport lines and general food processor lines.
US imports from the three countries totaled US$39.1 million in 2013.
The US International Trade Commission is due to make its final decision on whether the imports harmed local industry on July 6.
Nghe An introduces business opportunities in UK
UK businesses and trade organisations gathered at a seminar in London on May 23 seeking opportunities to invest in Vietnam, in particular Nghe An province.
Vice Chairman of the Nghe An provincial People’s Committee, Le Huy Dai, introduced the province’s potential, strength and favourable geographic position.
The locality has huge potential for developing the processing industry, forestry and maritime. However, it has not yet had many UK-invested projects.
The provincial leader expressed his hope that through the seminar, UK businesses will gain a better understanding about the province, encouraging investment, for their own interests and for provincial socio-economic development.
S.K Lingam, President of the ASEAN-UK Business Forum, called on UK businesses to keep their eye open for Vietnam which has a dynamic economy and political stability.
He pointed out Vietnam’s business and investment opportunities, especially in oil and gas, retails, port and logistics, education and training, financial services, electricity, information technology, and infrastructure, notably public-private partnership (TPP) projects.
Martyn Skinner, a consultant for the sole UK-invested project in Nghe An – Tate & Lyle Suger Factory which opened in 1996, shared experience in effectively running the project in Vietnam.
Tate & Lyle is considered the most effective among the 44 sugar projects in Vietnam. It has contributed significantly to provincial socio-economic development.
Dai answered all UK businesses’ questions related to the province’s preferential investment policies and administration procedures.
Vietnam inflation held steady in May
Vietnam’s May consumer price index (CPI) rose 0.2% over April and 4.72% from a year ago, the General Statistics Office (GSO) announced on May 24.
Nguyen Duc Thang, a senior GSO official, said the CPI for May edged up slightly due to relatively stable prices of essential products globally and a sufficient supply of food and foodstuff.
Notably, 10 out of the 11 consumer goods and services in the CPI basket registered price hikes during the month, ranging from 0.01% to 0.43%.
The highest rise of 0.43% was recorded in the housing and construction materials group which comes on the back of the central bank’s recent launch of a preferential credit package for the property market.
The educational group experienced the lowest rise of an inconsequential 0.01% while post and telecommunications services posted a decrease of 0.03% attributable to increased competition in the market.
The GSO reported that the recent hot weather put inflationary pressure on a number of products including some foodstuff, beverages, garment and textiles.
Meanwhile, HCM City’s CPI inched up modestly registering an uptick of 0.36% over the previous month. Some commodities that saw a rise in the price include meat (up 2.54%), processed seafood (up 1.05%), vegetables (up 6.71%), and fruits (up 2.56%).
Domestic gold prices continued to drop by 0.85% in May, in line with the overall world downward trend, while the US dollar also experienced a slight decrease of 0.04%.
Japan helps businesses improve competitive edge
HCM City-based small and medium-sized enterprises (SMEs) have received support from Japanese seniors to improve their competitive advantage.
At a review meeting on May 23 held by the Japan International Cooperation Agency (JICA) in HCM City, Nakagawa Seiji, a senior Japanese expert, announced that approximately 106 SMEs in the city have benefitted from the programme since it was launched in June 2010.
The programme enables Vietnamese SMEs improve their quality control systems, management capacity and productivity utilizing the 5S-Kaizen economic model.
JICA said that it will launch new projects in the coming time to further support Vietnamese SMEs after the current programme concludes in June 2014.
HCM City to inspect shopping websites
Competent agencies in HCMC will review operations of e-commerce websites to find appropriate measures for efficient management of e-commerce activities.
HCMC now has around 86,000 operational websites and 150,000 domain names registered by organizations and individuals in this city. However, only around 1,800 shopping websites nationwide have been registered with the Vietnam E-commerce and Information Technology Agency (VECITA) under the Ministry of Industry and Trade, according to the HCMC Department of Industry and Trade.
Local market monitoring teams will inspect the operational websites and domain names based on the list of those websites having registered with VECITA to detect illegal ones as well as origins of the products sold online.
The websites having registered with the ministry will be updated on www.online.gov.vn. Via this e-commerce management portal, enterprises and individuals can look into the procedures and conditions for registering an e-commerce website as well as apply for online shopping activities.
Nguyen Ngoc Dung, chief representative of the Vietnam E-commerce Association (VECOM) in the south, said VECOM had cooperated with government agencies, including VECITA, departments of information-communications and industry-trade to hold courses on e-commerce for enterprises to avoid administrative measures since they are not cognizant of regulations on e-commerce.
In the first months of this year, VECITA worked with High-Tech Crime Prevention Police Department and Hanoi Maker Management Department to check shopping websites in the city. Some website operators were fined for not having completed registration with the ministry or selling products with unclear origins.
VECITA said those violating websites would be added to a blacklist posted on www.online.gov.vn.
Copyright infringement seen in various fields
The infringement of copyright and related rights in Vietnam has occurred in various fields, with many serious cases happening on the internet and in the digital environment, an official from the Ministry of Culture, Sports and Tourism stated on May 22.
Vu Ngoc Hoan, deputy head of the ministry’s Copyright Office, pointed out the trend at an online conference on the issue among authorities of Hanoi , central Da Nang city and Ho Chi Minh City .
He reported that despite efforts to protect copyright and related rights, the infringements cover many fields, including journalism, films, music, radio, television and computer content.
The breach has affected creative activities, the investment environment, socio-economic and cultural development and international integration, Hoan noted.
In 2013, the ministry collected over 2 billion VND (about 95,200 USD) in fines from businesses for software copyright violations, and ordered three websites to remove thousands of pirated films.
It also received 60 letters of complaint on copyright disputes over 142 book editions from 25 publishing houses.
Authorities and representatives from copyright protection centres said the rampant breach is partly due to the mildness of penalties as well as a shortage of special agencies and concrete regulations
VN goods gain local consumers' increasing trust
After 5 years of implementation, the "Vietnamese give priority to use Vietnamese goods" campaign has earned positive results, the Vietnam Business Forum Magazine (VBF) said on May 22.
Many Vietnamese brands have gained larger market share in commercial centres, supermarkets, shops and in rural and remote areas, while consumers also have supported and used more and more Vietnamese goods. 2014 marks the fifth year of the implementation of the campaign.
Over the time, it has been aggressively deployed, creating a consensus response in the whole society. Despite the difficulties caused by the economic recession, businesses still strive to improve the quality of their goods and services at reasonable prices, which helps gain consumers' increasing trust.
In particular, 70 percent of domestic consumers trust the quality of Vietnamese goods which account for 70-90 percent in the modern distribution system. Many products have increasingly captured the tastes of Vietnamese such as food, textile products, clothing, kid toys, household items and school supplies.
At a meeting to review the results of the implementation of the campaign "Vietnamese give priority to use Vietnamese goods" held by its Central Steering Committee, Chairman of the Vietnam Fatherland Front Nguyen Thien Nhan said that "Encourage patriotism – Produce cheap but high quality goods - Enhance communications " are the three main pillars of the campaign.
Recently, Prime Minister Nguyen Tan Dung approved a domestic market development plan that shares a connection with the campaign "Vietnamese give priority to use Vietnamese goods” during the period 2014-2020. The purpose of the project is to develop the domestic market and help consumers become aware of manufacturing capabilities of Vietnamese enterprises and the quality of domestic products, goods and services.
The project aims at building a consumer culture based on patriotism and national pride in the long term. In addition, the programme aims to develop the domestic market, to meet the needs of producers and consumers, to promote the development of distribution systems (with domestic enterprises as the core) to facilitate the bringing of local goods to the hands of consumers to enhance purchasing power, stabilise market and improve people’s lives.
In the past 5 years, several measures have been taken to bring the best performance for the campaign. Particularly, due attention has been paid to combating smuggling, fake goods, intellectual property violations and illegal business behaviour. This has made a fundamental change in the management of goods circulated on the market, protecting consumers and Vietnamese businesses.
The domestic market develoment plan also offered four groups of measures which should be taken as following: helping change the perception and behaviour of the community towards domestic goods; supporting the sustainable distribution system of Vietnamese products; enhancing competitiveness of Vietnamese enterprises, cooperatives, small businesses in trading activities; improving the effectiveness of the inspection and control of the market and protecting consumers' rights.
On the task of developing sustainable distribution system of goods with a priority for Vietnamese goods, it is crucial to study and propose policies to strengthen and expand the distribution system, to build modern distribution channels for Vietnamese goods, to diversify forms of distribution, to set a sustainable retail system for Vietnamese goods.
The total funding for the implementation of the domestic market development plan associated with "Vietnamese give priority to use Vietnamese goods” campaign during the period 2014 - 2020 is expected to reach approximately 228.93 billion VND.
Flexible policies help boost agricultural production
The Ministry of Agriculture and Rural Development (MARD) organised a workshop to discuss solutions to change the usage of 112,000 hectares of ineffective rice-growing land for other crops in early May in Tien Giang province, the Communist Party of Vietnam (CPV) Online Newspaper reported.
Accordingly, the central budget will support farmers with 2 million VND per hectare to buy seeds to change from rice-growing to planting vegetables and crops in spring-summer, summer-autumn, autumn-winter harvests of 2014 and the winter-spring harvest of 2014-2015.
It is necessary to change ineffective rice-growing areas for planting other crops in order to ensure income for farmers as the rice prices are very precarious and farmers find it hard to sell their rice. Although Prime Minister Nguyen Tan Dung has issued Decision No. 580 on the support policy for shifting cultivation, the cultivating change in many localities occurs slowly due to various reasons.
In the recent past, many vegetables and crops such as sweet potato, sesame, corn, tuberose flower, vegetables and water melon brought higher economic efficiency as compared to rice cultivation. However, crops often prevail when they are cultivated in small areas and low yield, but when cultivated on a large scale, the situation of “bumper crops and low price” can happen and farmers have to bear the consequences.
This is the reason behind the agricultural sector and local authorities exercising caution when recommending the change from rice to vegetables and other crops. Departments responsible for agriculture and rural development in the Mekong Delta said that in terms of technique, the agricultural sector can support farmers to produce vegetables and other crops all year round, ensuring high productivity and quality. However, where the products are sold, who will buy them and how much they are sold for are beyond departments' control.
Many people raise questions about the responsibilities of the industry and trade sector, trade promotion centres, businesses and cooperatives. Regardless of such discussion many agricultural and aquatic products have still met difficulties in consumption. Although the Government has guidelines for conversion to agricultural crops, the agricultural sector and farmers are still worried about the consumption. Consequently they see that great risk can be encountered.
Along with the planting conversion, the Prime Minister has also issued a policy on debt restructuring and rescheduling loan payment for another 3 years for farmers who are experiencing difficulties in raising shrimp and tra fish. The support policy requires banks consider new loans to enable farmers to resume production.
However, the implementation of the support policy is slow and this has made farmers miss their production opportunities.
So far, the economy of many localities still depends on agriculture and it is considered as a pillar of social security. Over the past time, the Government has issued many policies and mechanisms to promote agricultural development, and to reach out to the world. However, the gap between the policies and realities has not been reduced.
Creating favourable conditions for farmers will boost production and allow them to meet market demand in terms of both quality and quantities.-
Tay Ninh-based firms boost chicken exports to Cambodia
Businesses based in the southern province of Tay Ninh have earned nearly 1 billion VND (47,000 USD) from their daily export of 10,000 chickens to Cambodia through auxiliary border checkpoints.
The province now has 86 chicken breeding areas under the model of large-scale farms, yielding a combined annual output of around 5.5 million chickens.
To ensure food safety and prevent bird flu, the province’s veterinary sector has chickens vaccinated against the A/H5N1 strain of the virus, in addition to intensifying environmental sanitation at the farms.
The price of chickens in southeastern provinces has increased to 38,000 VND (1.78 USD) per kilogram from 26,000 VND (1.22 USD) at the beginning of this year. The price enables local poultry breeders to make profits of 4,000-5,000 VND a kilogram.-
Vietnam, RoK cover significant ground at fifth FTA round
Vietnam and the Republic of Korea (RoK) made progress in negotiations on customs, the rule of origin, services, investment, laws, trade protection, sanitary and phytosanitary measures (SPS) and the technical barriers to trade (TBT) agreement during the fifth round of FTA talks in Seoul.
Vietnamese representatives participated in the May 20-23 talks with a focus on competition, e-commerce, and intellectual property.
Regarding the opening of commodities market, Vietnam urged the RoK to consider Vietnam’s advantageous products for export such as seafood and farm produce (rice and tropical fruits and vegetables).
Vietnam might also consider export benefits of the RoK and make improvements to its commitments, in line with the ASEAN-Korea Free Trade Agreement (AKFTA).
Both sides affirmed determination to conclude the AKFTA this year and the sixth round of FTA is expected to be held in mid-July in Vietnam.
Bilateral trade between Vietnam and the RoK has witnessed remarkable growth over the past twenty years. Two-way trade turnover has increased by nearly 55 times from 0.5 billion in 1992 to US$27.3 billion last year. In 2013, the RoK was Vietnam’s largest trade partner while Vietnam was the RoK’s sixth biggest export market.
The RoK is an important consumption market for Vietnam’s key export products such as seafood, garment and textile, footwear, wood products and farm produce.
Vietnam’s major imports from the RoK include machines and equipment, garments and textiles, leather shoes, oil and gas, iron and steel, plastics, chemicals and means of transport.
Hanoi to host Mid-term Vietnam Business Forum 2014
The Ministry of Planning and Investment recently announced that the mid-term Vietnam Business Forum 2014 (VBF) is due to be held in Hanoi on June 5.
The forum will focus on the socio-economic impact of the Trans-Pacific Partnership agreement (TPP) and European Union-Vietnam Free Trade Agreement, discussing both opportunities and challenges they pose for Vietnam.
Economic sectors that are attracting a great deal of attention from foreign investors such as banking and capital market, investment and trade, infrastructure and employment are expected to be hot topics of debate at the event.
The VBF is a policy channel between the Vietnamese Government and the international business community which is held annually with the aim of building a favourable business environment, attracting investment and promoting sustainable economic development in Vietnam.
Minister Vinh hoped that through the mid-term VBF 2014, Vietnam will receive more candid comments and long-term sincere commitment, helping Vietnam establish the continued faith of foreign investors.
Gov’t commits help to FDI businesses in disturbance-hit localities
Localities where social disturbances took place recently have dispatched their special working missions to industrial parks to inquire into the situation and help businesses resume operation.
Working missions have fanned out to every business in Binh Duong and Dong Nai instead of sitting and receiving business petitions, Deputy Prime Minister Vu Van Ninh said on the sidelines of the current National Assembly session in Hanoi on May 23.
He said the government is assessing the overall damages and the needs of businesses in order to offer support they need to get back in operation.
During a recent inspection tour to get a first-hand view of the damage in Dong Nai and Binh Duong, Ninh affirmed that the government will provide tax relief and abatements of other fees such as land lease and insurance to assist businesses.
Business owners voiced concerns that similar anti-China protests could possibly erupt in the future. Ninh assured them that the government has directed relevant ministries, agencies and localities to take drastic measures to ensure safety and security of businesses.
He said 90% of businesses have resumed normal operations, which reflects their trust in governmental policies.
The government is committed to castigating violators who caused the damages and has also agreed to reimburse businesses for the losses incurred in workers’ salaries, he said.Savills Vietnam storms Asia Pacific Property Awards 2014
Savills Vietnam has been officially named as the winner of the prestigious Asia-Pacific Property Awards 2014 held in Kuala Lumpur, Malaysia.
This year, Savills Vietnam won the awards for Best Real Estate Agency in Vietnam” and “Best Lettings Agency in Vietnam”.
The information was announced under the framework of the International Property Award, which attracts the world’s leading property and real estate companies. NeilMacGregor, Savills Vietnam Managing Director said that this is the third time Savills Vietnam has received the awards, affirming the company’s leading position in the international arena.
With such accolade, Savills Vietnam will continue to represent the Asia-Pacific region at the International Property Award 2014 to be held in Dubai in December.
Launched since 1995, the International Property Award aims to honour companies around the world which have obtained the highest achievements in the field of real estate.
Trade boom via Lao Cai border gate
Vietnam-China trade turnover through Lao Cai border gate was estimated at US$219 million in the first five months of 2014, representing an increase of 59% compared with the previous year.
The northern Lao Cai province’s Customs agency reported that there are approximately 200 trucks transporting goods from Vietnam to China and vice versa every day.
Vietnam’s major export items include rice, cassava, watermelon and various other types of farm produce which earned US$89.6 million, up 98.2%.
Imports from China include coal, fertilizers, chemicals, machinery, and equipment valued at US$129.8 million in total, up 52.1%.
Notably, export value from 157,000 tonnes of Vietnamese rice to China in the first five months of this year hit around US$96 million.
Nguyen Quyet Chien, head of the Lao Cai customs department, attributed the rising trade value between Vietnam and China to simplified procedures for import-export activity which were implemented on May 8, reducing customs clearance times by a third.
Livestock farms to be upgraded on industrial scale
Livestock breeding will increasingly take place on larger farms in an aim to increase value and sustainability, under a restructuring plan proposed by the Ministry of Agriculture and Rural Development.
Under the plan, livestock farming would gradually shift from high-population density areas in deltas to low-population density areas in midland and mountainous areas.
The livestock sector will also set up disease-free livestock breeding areas far away from cities and residential areas.
The aim is to increase the number of pigs raised on farms from 30 per cent to 52 per cent, chicken from 30 per cent to 60 per cent and ducks from 20 per cent to 60 per cent.
All milch cows would be raised on farms under an industrialised breeding method.
By 2020, there would be 300,000 milch cows with an annual milk output of 0.9 million tonnes.
The Hong (Red) River Delta and Southeast region will see a reduction in the number of breeding pigs while Tay Nguyen (Central Highlands), north-central region and the north's midland and mountainous areas would see an increase.
The number of pigs in the Red River Delta, for instance, will fall from 25.7 per cent of the country's total pigs in 2013 to 15 per cent by 2020.
The plan targets a higher rate of poultry, cow and buffalo meat as part of the livestock sector relative to the amount of pork.
Pork meat will fall from 74.2 per cent of the livestock sector in 2013 to 62 per cent by 2020.
The plan expects exports of about 1 million tonnes of pork, 70,000-100,000 tonnes of duck meat, and 1-2 billion salted duck eggs a year by 2020.
The number of ducks raised would rise from 84 million in 2013 to 100 million by 2020.
From 2014 to 2015, disease-free livestock breeding models for pigs, chicken or ducks will operate in several provinces, including in Vinh Phuc, Thai Nguyen, Binh Dinh and Tien Giang, Dong Thap and Tay Ninh.
Livestock breeders, including farmers and farm owners, will take training courses on breeding disease-free livestock.
The ministry's Animal Husbandry Department in cooperation with agencies and provincial Departments of Agriculture and Rural Development have been assigned to implement the restructuring plan.
Vietnam’s rising stature in global investment
Vietnam’s financial markets are deepening as foreign-invested enterprises continue to pump investment into the country at a substantial and growing pace.
Two Japanese-invested companies in the field of science and technology recently announced that they are increasing investment from between US$1.5 million and US$2 million to expand their production activities.
Germany’s Pepperl-Fuchs Vietnam Co, Ltd which specializes in producing high-tech sensors equipment, also recently filed documents requesting authorization to increase capital at its facilities located in HCM City’s export processing zones and industrial parks.
Once approved, the company’s increased capital will exceed US$10 million spanning 9,000 square metres.
The Department of Planning and Investment of HCM City recently announced that several foreign businesses in the city have been licensed to increase capital to expand production and meet the increasing number of orders.
Officials at the city unveiled that two foreign-invested enterprises from Hong Kong, RGF HR Agent Vietnam Co Ltd and Delta Starmark Garment Vietnam Co Ltd, have increased their additional capital from between US$1.6 million and US$1.8 million.
Last but not least, Japan’s Koa-Sha Media Vietnam Co, Ltd has just increased its additional capital by US$1.5 million while Aureole Information Technology Inc. (AIT) also raised its additional capital to US$2 million.
Honda Vietnam to launch 10 new motorbike models
Honda Vietnam has announced that it will launch ten new motorbike models in fiscal year ending March 2015, aiming to turn Vietnam into the “hub” of the motorbike world.
The company unveiled that it aims to sell two million motorbikes during the year increasing its sales volume to US$247 million, up 166% over the prior year.
It also plans to expand exports to over 22 nations in the world. The company said that domestic motorbike sales are forecast at 2.71 million, down 13% over last year attributable to the fact that the national economy has not fully recovered. However, the company is bullish on international motorbikes sales, reaching 1.85 million with a concurrent increase in market share from 5.5% to 68%.
The company currently exports motorbikes to Europe, Asia, South-West Asia, North and South America. Additionally, it exports a special model like Dunk motorbike to the Japanese market.
Honda Vietnam currently has two fully operational factories in Vietnam. A third is expected to be put into operation this coming October capable of producing 2.5 million motorbikes per annum.
Rosneft, PetroVietnam sign contract for oil supplies
At the St. Petersburg International Economic Forum on May 24, the Russian Rosneft Oil and Gas Group and Vietnam Oil and Gas Group (PetroVietnam) signed an agreement including major terms for long-term oil supplies to Dung Quat Oil Refinery in Vietnam.
The signing ceremony was chaired by Russian President Vladimir Putin. Under the agreement, Rosneft will provide Dung Quat Oil Refinery with 6 million tonnes of ESPO oil per year via Kozmino terminal from now till 2039.
Rosneft President Igor Sechin said that PetroVietnam is one of the main Rosneft’s partners in the Asia-Pacific region. The long-term contract for oil supplies is the crucial phase in developing cooperative relations between the two groups.
Petrolimex aims for pre-tax earnings of VND2,000bil
Vietnam National Petroleum Group (Petrolimex) recently unveiled its business plan at the company’s annual shareholder meeting, targeting a pre-tax profit of VND2,000 billion for 2014, down 1% over last year.
A spokesperson for Petrolimex said that the company is forecasting that fierce competition will drive prices of petroleum products down as demand for petroleum products in Vietnam softens in 2014. In addition, petroleum import-export activities are expected to be tighter, giving rise to a reduction in overall output, the spokesperson said.
Petrolimex Director Tran Van Thinh said the company is committed to growth by the exploitation of oil assets in both the domestic and international markets.This year, Petrolimex is expected to sell 9.2 million cubic metres of petroleum in such markets as Vietnam, Laos and Singapore with an estimated aggregate revenue reaching VND200,000 billion.
Japan group inaugurates lubricant oil factory in Haiphong
JX Nippon Oil & Energy Vietnam has just opened a lubricant oil factory at Dinh Vu Industrial Zone in Haiphong.
The company, an affiliate of Japan’s JX Nippon Oil & Energy group, was granted a license to run a project at Dinh Vu IZ in 2010. It started building the factory in November 2013 and officially began operating less than a year after construction began.
JX Nippon Oil & Energy Vietnam General director Toshiaki Nagasawa said the factory, one of the group’s eight overseas, uses modern technology with a capacity of 40,000 tonnes per year to supply high quality products of gasoline, diesel, ATE and industrial oil.
He added that the company can now directly supply products to Vietnamese consumers.
JX Nippon Oil & Energy is Japan’s leading group in oil refinery and material oil which accounts for one-third of the country’s volume and is the sixth largest lubricant oil producer in the world.
In addition, it also operates in electricity, fuel gas and solar energy generators and is expanding investment in oil and gas exploration and development.
The group has operated in Vietnam since 1996 and set up a representative office in Ho Chi Minh City in 2010.
Vietnamese products seek market niche in Europe
A week of Vietnamese products will be held at Metro supermarket chain in Berlin, Germany in late June and at Casino Group’s Big C supermarket chain in France in September.
Dang Hoang Hai, head of the European Market Department says the week is part of a Government initiative, aiming to promote local products to huge and potential global markets.
The programme helps local businesses export products directly to EU distribution networks in anticipation of the signing of a free trade area (FTA) between Vietnam and the EU, enjoying higher profits and reducing intermediate costs.
Hai admits that Vietnamese businesses still find it difficult to penetrate EU supermarkets due to high intermediate costs, along with tough financial negotiations, and requirements for big supplies, and brand building.
The Vietnam-EU FTA is an important solution for dealing with challenges facing businesses. Under the trade pact, most Vietnamese products exported to the EU may enjoy minimal tariffs, sometimes as low zero.
Promoting exports to the EU is a priority of Vietnam in the integration process. The EU is a large, lucrative market for Vietnamese businesses as it boasts 28 member countries with about 500 million consumers and a total GDP value of US$16,000 billion or one-fourth of the world economy.
NA discusses public investment law
Deputies agreed on Saturday that the revised Law on Public Investment should control the use of public funds to prevent ineffective investment in line with the country's socio-economic development plan, while also meeting the demand for economic restructuring.
At the general session on Saturday, members said the law would govern activities related to approving investment plans and assessing the source of funds.
The revised law applies to all stakeholders of the economy that use public funds. NA members believed that the law's issuance would address the shortcomings that remained in State management of public investment, particularly in investment plan decisions, investment preparedness and capital allocation.
The revision was also consistent with existing laws governing State budget, investment, construction, bidding and land, which provided a legal basis for investment management and public investment, NA members said.
NA member Huynh Nghia suggested that the revised Law on Public Investment clarify ways to make the process more transparent, such as publishing project size and sources of funding, and encouraged localities to be more proactive in allotting funds for public investment projects.
Truong Van Vo, a member from Dong Nai Province, said that measuring the effectiveness of public investment projects should be a top priority in order to hold organisations and individuals accountable.
He also said the law should conform to regional development plans and rely on those for fund allocation.
Also on Saturday, the NA members discussed the revised Law on Construction, which aims to assign more responsibility to owners of construction projects for ensuring projects are carried out efficiently and follow regulations.
Do Manh Hung, an NA member from Thai Nguyen Province, said the revised Law on Construction should not only consider construction activities in terms of their technical aspects but should aim to achieve socio-economic goals.
Tran Minh Dieu, a member from Quang Binh, said construction materials were an important aspect of construction sites and must be clarified in the law, which would then serve as a legal foundation to manage and inspect construction sites.
Tran Khac Tam from Soc Trang Province said the law should regulate that public construction sites must be accessible to the disabled, the elderly and children.