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This reflects growing interest in the luxury resort property segment amid the recovery of the real estate market.
Syrena Viet Nam, a subsidiary of the BIM Group and the developer of Lotus Residences, said the buyers of Lotus Residence townhouses at the weekend sale were mainly those who already owned at least a resort unit in tourism hubs across the country, such as Da Nang, Nha Trang and Phu Quoc.
Many wealthy Hanoians were seeking to invest in quality resort projects with promising and guaranteed profits and Lotus Residences, located in the prime Halong Marina Urban Area, gave them valuable opportunities.
Experts said Lotus Residences offered several advantages that made its townhouses attractive to buyers, especially the application of rental pool – the management model in which the parties involved share rental income from a property, as well as the expenses associated with its ownership and maintenance – with the high guaranteed profits from the developer.
Thu Thuy from Ha Noi said she decided to buy a townhouse of Lotus Residences because she saw this as a good investment opportunity compared with bank savings. She said the developer guaranteed a whopping profit of up to 24 per cent of the townhouse's value in the first three years of operation. In addition, the buyers would get 60 days of use every year.
Lotus Residences' prime location along Ha Long Beach also made the project attractive to investors.
Ha Long has been the investment destination of large developers such as Vingroup, Tuan Chau Group, Sun Group and Amata, as well as Nakkeel and ISC Corp, who have poured billions of dollars in the tourism city's resort property market.
Syrena Viet Nam said the market was showing positive signs and that Lotus Residences' quality and originality would continue to attract buyers.
Lotus Residences, covering a total area of 40,000sq.m in Halong Marina Urban Area, comprises 159 four-storey townhouses with environment-friendly designs that combine retail and tourism purposes.
National online shopping day launched
The HCM City Department of Industry and Trade will launch its first online shopping day on Saturday on the website www.khuyenmaitructuyenhcm.gov.vn in an aim to enhance trust among consumers.
Tran Vinh Nhung, the department's deputy director, said yesterday that "Vui la mua, tin la sam" (Happy to buy, trust shopping) will last only 24 hours.
Promotions in 31 product categories with 10,000 kinds of products will be offered in hopes of attracting consumers who still mistrust online shopping.
The online shopping day is an extension of the Autumn Online Shopping Day held by the Ministry of Industry and Trade on August 28.
The city's online shopping day is expected to help local businesses and e-commerce websites tap the potentially huge market of HCM City.
The country has 7,500 e-commerce websites, and HCM City accounts for half of them (3,600).
Viet Nam has 40 million internet users, 30 million of whom use social media and e-commerce.
Jose Finch, country managing director for online shopping site Zalora Viet Nam, said business-to-customer (B2C) e-commerce turnover in Viet Nam had hit US$2.97 billion in 2014, accounting for 2.12 per cent of the country's retail sales.
Many shoppers, however, still mistrust online shopping, fearing low-quality products, lack of payment security and poor refund policies.
Participating businesses in the online shopping day agreed to guarantee quality and source of origin information.
The DoIT said "it would supervise all transactions during the shopping day and solve any dispute to ensure the legal rights of both businesses and consumers."
For the online shopping day in HCM City, popular shopping portal Zalora is offering 300 deals on cosmetics and fashion products.
Another 20 shopping websites are participating in the event, including The Gioi Di Dong, Tiki, Thien Hoa, Hotdeal, Nhommua and Lazada.
The DoIt plans to make the national online shopping day an annual event.
It has scheduled the event for the Lunar New Year period and National Reunification Day (April 30) holidays.
The department will organise the next event from January 18-24 next year.
Business associations urged to boost co-operation
Viet Nam has developed 400 business associations nationwide, but links and co-operation among them have been poor, chairman of the Viet Nam Chamber of Commerce and Industry (VCCI), Vu Tien Loc, said yesterday at a conference on integration and institutional reform, and competitive capacity improvement in new context.
The conference, which drew over 150 businesses in the Central and Central Highlands regions in Da Nang, focused on how to raise awareness and skills of businesses catching up on opportunities at a time when Viet Nam has approached Trans-Pacific Partnership, ASEAN Economic Community and signed a Free Trade Agreement (FTA) with the Eurasian Economic Union (EAEU).
"Domestic businesses are told to have more competitive capacity, develop better technology and legal knowledge in availing of opportunities for exports and production for large markets," Loc said.
"Local business associations play an important role in providing detailed information and guidance on institutions and legal framework and tax cuts when the country signs FTAs," he said.
"Businesses should understand more about the FTA in order to overcome difficulties and improve product quality to meet the strict requirements of these markets," he said.
Loc also added that ASEAN has set a goal for the ASEAN Economic Community (AEC) to be established by the end of 2015, and Viet Nam has made efforts to take part in new trade agreements such as the Trans-Pacific Partnership Agreement (TPP) and the Viet Nam-EU Free Trade Agreement.
Nguyen Van Ly, general secretary of the Da Nang city's small and medium-sized enterprises (SMEs) association, said integration and FTA will bring new opportunities for businesses in Viet Nam to expand their markets and attract foreign investment.
"Vietnamese businesses need to prepare for the impact of the new global business environment and strengthen their competitiveness in foreign trade, particularly through online technologies like e-commerce," Ly said.
E-commerce emerged as a subject of major discussions among businesses at the conference.
According to the Viet Nam E-commerce Association (VECOM), business to consumer (B2C) e-commerce sales in Viet Nam in 2014 totalled approximately US$2.97 billion.
"E-commerce is bringing a lot of opportunities for SMEs, thanks to its ability to allow around-the-clock customer sales, reduced marketing and transaction expenses, and an overall market expansion to regions outside Viet Nam," Vice Chairman and General Secretary of VECOM, Nguyen Thanh Hung, said.
"SMEs need to invest to build an online presence in order to compete in this new business environment. They can grow into global businesses with easy access to partners and customers around the world and increase their profitability in the long term with a strong online brand," he said.
"It is important for businesses to build and develop their own online brands with a reputable domain name," said Nguyen Minh Thai, Business Development Director of Eye Storm Network, one of leading registrars in Viet Nam.
"Choosing an appropriate domain name is the first step in building a successful online presence. While there are many domains available,.com is the global online standard for doing business online," he said.
Thai said his company always advised customers to choose .com due to its availability, reliability and stability to build their online brands, especially when they want to reach larger markets.
According to VCCI, garment-textile, shoes and sandals, seafood, furniture and handbag sector will witness tax cuts from 77 per to 100 per cent on account of the FTA commitments with the EAEU.
"We are in the dark as there are too many associations. We did not know how to access information for export or new export market," said Nguyen Van Son, director of a sandal and furniture export company in Da Nang.
"We mostly ask for such information through other partners or try and find it ourselves. The business association has yet to provide necessary information to us," Son said.
"We get little opportunity to join trade fairs abroad due to limited funds at our disposal for travelling or accessing sources of information," he said.
He asked for further commitment and support from VCCI's branches and local associations in hosting more conferences and advocated introduction of new markets or new tax policies rather than organising useless seminars.
He blamed that some seminars were not attractive or dispense little information useful for businesses.
Taiwanese firms flock to Viet Nam
Viet Nam's fast-growing market has attracted a large number of Taiwanese companies that plan to invest in the country in the coming years.
John Tang, director of the Taiwan Trade Centre (TAITRA) office in HCM City, said Taiwanese companies were among the first foreign investors investing in Viet Nam.
Tang spoke to the press on the sidelines of a meeting of 33 Taiwanese companies and their Vietnamese counterparts in HCM City yesterday.
About 500-600 Taiwanese firms operate in the city. Most of them make products for export.
In the future the companies are expected to make products for both Vietnamese and export markets.
Many retailers are also expected to enter Viet Nam's retail market, as it has a high growth rate.
In addition, Taiwanese firms plan to invest in a textile production chain in Viet Nam in the coming time to benefit from the upcoming Trans Pacific Partnership (TPP), Tang said.
The visiting Taiwanese companies operate in two major segments, daily commodities and industrial goods and equipment. They hope that co-operation opportunities between Taiwanese and Vietnamese counterparts will materialise soon, Tang said.
The business meeting was part of a trade mission held by the Taiwan.
DongA Bank names temporary director
The DongA Bank management board has nominated deputy general director Nguyen An to run the bank until a permanent replacement is identified for sacked general director Tran Phuong Binh.
The State Bank of Viet Nam had earlier dismissed Binh and his deputy Nguyen Thi Ngoc Van for violations on their watch, and replaced them with executives from the Bank for Investment and Development of Viet Nam (BIDV) on August 20.
But then the central bank changed its mind, cancelled the duo's appointment, and said DongA could choose its own head.
Nguyen Hoang Minh, deputy director of the central bank's HCM City office told Tuoi Tre newspaper, that the change was based on "practical developments" at DongA over the last few days.
An will ensure routine operations are not affected while the bank awaits further directives for appointing a new general director.
He has worked at DongA for 22 years and became deputy general director in 2008. He has reportedly been quoted as saying that since he had headed retail banking – a core area for the bank – he is confident of leading the lender through this hard period.
The central bank has placed DongA under special supervision since the middle of this month when inspectors uncovered illegal activities by the bank that could cause serious financial consequences for the State and citizens. It has also promised a thorough overhaul of the bank. DongA, which has a capital of VND5 trillion (US$222.22 million), targets pre-tax profits of VND200 billion ($8.89 million) this year after a slump last year.
Government stake sale needs regulations to prevent corruption
Deputy Prime Minister Vu Van Ninh said the draft on selling Government stakes as share packages must include strict regulations to prevent corruption, while still encouraging those who seek long-term investments.
Ninh said, during a Monday meeting with involved ministries, that selling Government stakes in packages was considered a good measure to hasten the privatisation of State-owned enterprises (SOEs).
However, many problems might arise, such as corruption or causing losses to State capital if the draft failed to anticipate those problems, Ninh warned.
According to the Ministry of Finance, the draft decision stipulated that the sale of Government stakes at joint stock companies which had not been listed or registered trading on UpCoM, included State capital withdrawals from 100-per cent State-owned corporations.
State stakes could be divided into many packages for auction, but each package must be worth less than 5 per cent of the charter capital. Meanwhile, appointed sales of share packages must be carried out following the Prime Minister's decision.
Both domestic and foreign investors could hold unlimited stakes, except in sectors with caps on holdings of foreign investors.
Ninh said that the auctions must be transparent.
The draft was expected to be submitted to the Prime Minister for approval this month.
According to Dang Quyet Tien, Deputy Director of the Corporate Finance Department under the Ministry of Industry and Trade, the draft would be developed into a decree and include a set of comprehensive solutions to hasten the progress of SOEs' privatisation, which had slowed since the beginning of this year.
Besides selling State stakes in packages, there would be regulations allowing SOEs to be transferred to joint stock companies when they did not have conditions to immediately implement IPO's.
Tien said that coupled with the regulation on increasing foreign holdings in the Law on Securities, which would take effect from the beginning of this month, the draft would help stimulate market demands and hasten the privatisation process.
This year, Viet Nam planned to privatise 289 SOEs as part of an ambitious plan to privatise 432 SOEs during 2014-15. Last year, 143 SOEs were privatised, along with 61 SOEs in the first six months of this year.
Japanese firm purchases 30% stake in Hotdeal
Tokyo-based outsourcing giant Transcosmos has acquired a 30 per cent stake in Hotdeal Co Ltd, which owns Viet Nam's largest e-commerce marketplace hotdeal.vn, a representative of the Japanese company in Viet Nam told Viet Nam News yesterday.
The deal was signed recently between Transcosmos president Masataka Okuda and Hotdeal CEO and co-founder Nguyen Thanh Van An.
Transcosmos said it would use Hotdeal to provide products and services from its partners to consumers in Viet Nam and also to enter the ASEAN market.
"The e-commerce platform that Hotdeal has will be combined with the operations of transcosmos to continue a broad co-operation as partners in the ASEAN region, including support for client companies that are expanding e-commerce to the ASEAN market."
An said he believed the strategic tie-up would be a breakthrough for Hotdeal in improving its quality of services and expanding business in Viet Nam.
"In addition, this partnership will introduce Hotdeal.vn to international brands, secure know-how in the e-commerce and trading industry, and internationalise its management and cross-border trading capabilities."
Hotdeal, established in 2010, also operates the travel vertical yesgo.vn.
Its core business, Hotdeal.vn, utilises group purchasing and flash marketing combined with traditional e-tailing services out of its warehouses in HCM City and Ha Noi to sell items like discount vouchers for restaurants and spas, consumer products like fashion, home electronics, daily necessities, accessories, toys, health and beauty products, books, and services like tours.
Most of its customers are in the young adult segment in HCM City and Ha Noi. With 2.5 million members and approximately 3.1 million unique monthly users, it is Viet Nam's largest daily deal website.
Transcosmos, launched in 1966, has a presence in 34 countries where it offers e-commerce services to deliver client companies' products and services. It plans to shift its focus to the ASEAN market.
EVN earns $43.6m from divestment
Electricity of Viet Nam (EVN) has completed divestment from three real estate companies, while reducing its capital at EVN Finance Company to 16.5 per cent of its original charter capital.
Following three years of divestment, EVN has earned VND981 billion (US$43.6 million).
In the group's report to the Government on its implementation of its restructuring plan, EVN said it had faced difficulties when withdrawing capital from some of its larger corporations.
EVN's biggest challenge was divesting from businesses in finance, banking, securities, insurance and property, due to the requirements of ensuring capital in the midst of a bleak securities market. In addition, regulations on divestment have resulted in shortcomings.
EVN, however, has been active in developing divestment plans, organising public auctions, as well as seeking partners to transfer their capital into enterprises that are to be divested.
Further, the group has carried out equitisation of Power Generation Corporation 3 (GENCO 3) and is preparing for equitisation at GENCO 1 and 2.
The equitisation of GENCO 3 has seen difficulties, as the company was established to follow a road map of the competitive electricity market, as it seeks to manage, operate and produce power. The equitisation would be implemented after the company's financial situation was considered healthy. However, the company has found it difficult to arrange capital for its projects, making it less attractive to investors.
Further, EVN said it had proposed to the Government and other agencies that they issue Decrees and Circulars to provide guidelines on implementation of the Enterprise Law, which took effect on July 1st.
It has also carried out power tariff adjustments using the existing market mechanisms.
On November 23, 2012, Prime Minister Nguyen Tan Dung enacted Decision No 1782/QD-TTg, approving EVN's restructuring plan.
The plan sought to ensure EVN's suitable structure and focus on power production and trading.
EVN has been allowed to access export credits from Russia and preferential loans from the Japanese government for construction of the Ninh Thuan Nuclear Power Plant.
Accordingly, Russia agreed to lend EVN $10.5 billion, while Japan is to provide capital from ODA for the plant.
The National Assembly, in 2009, passed a resolution on the construction of a 4,000MW nuclear power plant in the province's Thuan Nam and Ninh Hai districts, with investment of VND200 trillion ($8.9 billion) from EVN, the main investor in the two plants.
The plant was begun in 2015 and has its maiden trial scheduled for 2020.
Provinces to build Singapore Industrial Park
Authorities in the Mekong province of Tra Vinh have agreed with their Binh Duong counterparts to build a Viet Nam – Singapore Industrial Park, of which there are already three in the country.
Speaking at a meeting between the two provincial officials last week, a spokesman for the Tra Vinh People's Committee said park would seek to develop Tra Vinh into a centre for processing farm and forestry produce and aquaculture and one that consume these materials produced by the delta's 13 provinces. The VSIP model, which has been embraced by many localities across the country, has helped attract investments, he said.
The VSIP, built by a joint venture between Singaporean Sembcorp Development and Vietnamese developer Becamex IDC, was first built in Binh Duong and then Nghe An and Quang Ngai provinces. Nguyen Van Hung, president of Becamex, told Tra Vinh officials about his company's experience in signing deals with Singaporean partners, building VSIP in other provinces, and what Tra Vinh should do when building a similar.
The three VSIPs have managed to attract a lot of foreign direct investment, he added.
Credit firms struggle to retrieve collateral
While handling pledged assets was considered an effective tool for credit institutions to retrieve debts and reduce non-performing loans, gaps in regulation have been hindering progress on this front, experts said during a seminar in Ha Noi last week.
According to Nguyen Tien Dong, Director of the central bank's Department of Credit for Economic Sectors, handling of pledged assets was becoming a pressing matter of concern in the operation of credit institutions.
He attributed the stagnation in handling pledged assets to the overlaps and gaps in relevant legal documents which made it difficult to properly evaluate the value of the pledged assets or hindered seizure of assets.
While a majority of pledged assets were in the shape of real estate, handling such assets involves many entities, but the lack of co-ordination among such entities was causing delays in transferring pledged assets.
The general secretary of Viet Nam Banks Association, Tran Thi Hong Hanh, said the process to handle these pledged assets must be expedited as stagnation would hurt both lenders and borrowers as well as the economy. He urged that the legal framework needs to be improved.
Facts show that involved parties in any pledged asset hardly reached an agreement regarding the value of the asset, especially if the pledged assets were evaluated lower than the loan amount, experts said. Many such cases were brought to courts, thus taking valuable time.
According to Pham Hong Son, head of Agribank's Department of Individual and Household Customers, involved parties could take advantage of the gaps in regulation to prolong any dispute over asset handling.
In addition, auctioning process of pledged assets lacked transparency and sometimes the assets were over-evaluated on purpose, said a representative from Ha Noi Civil Judgement Enforcement.
According to Dong, credit institutions should pay adequate attention to the evaluation and management of pledged assets to prevent conflicts which might arise later.
The co-ordination among local authorities, banks and the police was also important in handling pledged assets, experts said, adding that regulations about responsibilities of the police and people's committees, in co-ordination with credit institutions and Viet Nam Asset Management Company, were needed to hasten resolution of bad debts.
Low salaries drive workers out of IZs
Many Vietnamese workers at industrial zones are saying they can’t earn enough to make ends meet and will soon seek other jobs.
Pham Thi H has been working for a company in Bac Ninh Province for a month. After graduating from high school, H helped her parents at their family's shop in Cam Thuy District in Thanh Hoa Province for two years. She then followed her cousin to seek better opportunities. Living some 200 kilometres from home, H said that her salary of VND5 million (USD240) a month was just enough to cover basic needs.
“I’m not going to stay here long," the 21-year-old worker said. "I’m now spending all I can make. I now intend to go abroad to work for some years so that I can put aside some money for the future. Not only me but many of my colleagues here don’t want to take this work long. They are just waiting for an opportunity."
Hoang Thi X who is working for Foster Company in the Tu Son Industrial Zone, Bac Ninh Province, is sharing a small rented room near her company with a colleague.
"We don’t buy much furniture, no TV, no fridge, partly because we are sending all we can save home to support our children," X says. "Another reason is that we don’t intend to work here long."
X comes from Bac Son District in Lang Son Province, which is some 80 kilometres from her workplace. She has been working here for nearly two years with a salary of just over VND5 million.
“Our life is very difficult with this modest income but I’m still staying here to wait for new opportunities. Or maybe I'll return my hometown soon to find new work."
Many young parents who are both workers are also finding it hard to settle in local industrial zones due to the low income.
Nguyen Thi Q and her husband from central Nghe An Province have been working for an electronics company in Hanoi's Bac Thang Long Industrial Zone for four years now. Their total income of nearly VND9 million a month seems too small to cover daily expenses, especially since they have two children.
"With this income we’ll never be able to buy a house," Q says. "So we’ll return our hometown soon to stay with our parents and do farming again."
Q says that many young people from her area are flocking to cities to seek better work and higher incomes at industrial zones but are disappointed.
"We are always looking for a chance to leave our company," Q explains. "I know farm work is harder and doesn’t bring much money either but at least life in the countryside is cheaper and we don’t have to worry about buying a house."
However, a recent survey by Vietnam General Confederation of Labour at 60 enterprises in ten provinces and cities including Hanoi, Yen Bai, Nam Dinh, Vinh Phuc, Hai Duong, Thua Thien - Hue, Danang, HCM City, Can Tho and Ben Tre showed a different situation. When questioned about their future plans, as much as 78.8 per cent of workers say they will stay long with their companies, 17.5 per cent say they want to find a new job and 3.7 per cent say they have no plan.
Ha Noi forum calls for outside investment
Ha Noi administration has announced that it will focus on promoting investment in industry, trade and services, social infrastructure and agro-forestry besides affirming best incentives to investors to deploy their project on schedule.
The announcement was made yesterday during a conference on investment promotion of Ha Noi City 2015 held by the Ha Noi People's Committee.
Nguyen Ngoc Tuan, vice chairman of Ha Noi People's Committee, told participants that over the years, investment performance of Ha Noi had developed positively, both in quality and quantity. The total investment capital in the capital city reached more than VND1,400 trillion (US$62 billion) over the last five years, double than that between 2006-2010, with foreign investment playing a key role.
City authorities would also promote administrative reforms and improve the processes of planning, investment, building and taxation to support businesses. Numerous trade promotion activities would also be held to attract more domestic and foreign investment, Tuan said.
As of 31 July , it had attracted 3,206 foreign-invested projects with a combined investment capital of more than $24 billion, ranking third among 63 cities and provinces nationwide. Of the figure, 162 projects were new and 30 were additional capital projects.
Speaking at the conference, Do Nhat Hoang, Director of Foreign Investment Agency, said to further attract FDI, Ha Noi should enhance its potential promotion and investment opportunities and clear obstacles in land clearance as well as shorten the time for issuance of investment certificate and paper-work. In addition, it should promote investment and business connections through banks, investment funds and consultancy companies.
The city's chairman, Nguyen The Thao, said Ha Noi would focus on attracting investment in industries to promote technology transfer, especially in high-tech, and create jobs and increase exports as well as train human resources and develop infrastructure facilities, support industry and high-quality service.
In the field of industry and construction, the city would focus on enhancing capacity building and position the industry in such a way that it can avail of the advantages and attain competitiveness to join in the global value chain such as support industry, information technology, biotechnology, high technology, microelectronics industry, said the chairman.
In addition, the city will also call upon investors to invest in building economic zones and industrial complexes. Priority will be given to large-scale projects that are less labour intensive, have high technological content, are clean and have high-added value and deploy environment-friendly technology.
Investors are encouraged to invest in public transport and railway system, telecoms network and waste water network besides entertainment areas.
In trade service sector, the city will formulate policies to spur trade service sector, particularly for sectors like finance and banking, logistics, posts and telecommunications, health care, culture, education, training and other services sectors.
Ha Noi will also attract investment in health care services, education and training and building of a number of high-quality universities with international standards, and luxury resorts associated with healthcare service.
In agro – forestry sector, Ha Noi city also encourages investment in biotechnology, high-tech agriculture and animal husbandry research.
The city chairman told the conference that the city administration was committed to constantly creating a transparent and open investment environment. He said it would also come up with solutions to handle obstacles facing investors and offer best incentives to them to do business in Ha Noi.
Hanoi ranking third yet striving for more
Hanoi currently ranks third out of 63 provinces and cities in attracting foreign investment, with the total investment capital of $24.05 billion as of July 20, 2015, according to statistics published by the Foreign Investment Agency (FIA) under the Ministry of Planning and Investment.
Foreign investors have engaged in 3,209 projects in Hanoi, with the total capital of $24.05 billion. In the first seven months of this year alone, the city attracted $96.4 billion to 162 newly-registered projects and $110.68 million in added capital to 30 existing ones.
“Hanoi has a strong competitive advantage compared to the northern provinces in attracting foreign investment as it has many industrial parks, including the Thang Long I Industrial Zone, the Noi Bai Industrial Zone and the Hanoi Southern Supporting Industrial Park. Furthermore, the city has access to modern infrastructure such as the Noibai International Airport, the Nhat Tan Bridge and the Hoa Lac Hi-tech Park,” Kana Miyazaki, deputy chief representative of the Japan External Trade Organization in Hanoi said at the Conference on Investment Promotion of Hanoi 2015, held on August 24.
“Hanoi is one of the most important business portals in Vietnam. It is an ideal destination for foreigners, especially for Japanese investors, due to its advantages in geographical location, human resources, fast economic growth speed and many existing subsidies as well as incentives,” said Masaki Kanatsu, general manager of the development department of AeonMall Vietnam Co., Ltd.
However, FIA’s general director Do Nhat Hoang said that Vietnam, in general, and Hanoi, in particular, was facing difficulties and challenges in attracting FDI as enterprises were waiting in anticipation for the Law on Investment, the Law on Enterprises and the related guiding documents.
“In order to deal with these problems, authorities should boost the promotion of the investment opportunities of the city and accelerate the awarding of investment certificates and relevant procedures in order to facilitate investors. It would also be welcome to establish a “Task Force Team” to support investors in preparing and implementing large-scale projects,” Hoang added.
VIR/dtinews/VNS
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