Ben Thanh Suoi Tien urban railway construction to kicks off tomorrow

Construction of the HCM City Urban Railway Construction Project Line 1 is scheduled to begin tomorrow in HCM City.

The 19.7km Line 1 has 2.6km of underground section (Ben Thanh-Ba Son) with three underground stations and the remainder elevated (Ba Son-Suoi Tien) with 11 stations.

The project is part of Package 2 (the first to be started of four packages for Line 1), comprising of all civil and structural works for the elevated section and the depot.

The construction work will be carried out by the Consortium of Sumitomo-Civil Engineering Construction Corporation No.6.

The other three packages are planned to start soon.

Upon completion by the end of 2018, Line 1 is expected to contribute to economic development and mitigation of traffic congestion and pollution.

Exports surge 17.8% in first eight months

The country's exports in the first eight months of the year surged 17.8 per cent year-on-year to US$73.35 billion, while imports reached $73.41 billion, up 6.7 per cent, according to the General Statistics Office (GSO).

In August alone, the country earned $9.8 billion from exports, down 3.8 per cent from the July figure, with a trade deficit of $150 million after enjoying a trade surplus for the past two consecutive months.

Director of the GSO's Trade Department Le Thi Minh Thuy attributed the relatively positive trade balance to a decrease in imports.

She said after recording a 11.8 per cent increase in February, the rising rate of imports from March to August had slowed to around 6 per cent. Exports, meanwhile, rose 17.8 per cent and 19 per cent in July and August after hitting a 22-24 per cent rise during February and June.

According to the GSO, 15 out of 28 export staples gained high growth rates, with turnover of between $1 billion and $9 billion in the first eight months. Textiles and garments were the biggest earner with $9.72 billion, up 7 per cent. Mobile phones and parts ranked second with $7.35 billion, up 134.3 per cent. Crude oil, seafood, electronic products and computers, wooden products, and coffee followed with turnover ranging from $2.46 billion to $5.54 billion each.

However, several key export staples reported a decline in both quantity and value during the period. Coal export volume, for example, decreased 23.8 per cent to 8.74 million tonnes, and value was down 30.2 per cent at $769 million. Rice also fell 9.1 per cent to $2.46 billion in value.

Of the total export turnover in the first eight months, foreign-invested firms accounted for $45.63 billion, up 34.1 per cent, while State-owned enterprises reported a decrease of 1.85 per cent at $27.71 billion.

Banks to help livestock, fisheries sectors
 
The State Bank of Viet Nam has asked five major commercial banks to prioritise loans and debt extensions for farmers and enterprises in the livestock and fisheries sectors.

The Viet Nam Bank of Agriculture and Rural Development (Agribank), Bank for Investment and Development of Viet Nam (BIDV), Viet Nam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), Bank for Foreign Trade of Viet Nam (Vietcombank) and Mekong Delta Housing Bank (MHB) will now have to reduce interest rates on loans for these farmers and enterprises to a maximum level of 11 per cent per year — the lowest market interest rate at present.

Customers experiencing difficulties in their business and production could be given another two years to pay back debts, as requested by the central bank.

The move followed Prime Minister Nguyen Tan Dung's order on August 8 to help struggling farmers in the sector in the wake of disease outbreaks, falling prices and capital shortages.

Priorities are given to households, co-operatives and enterprises raising, slaughtering and processing livestock, poultry and tra fish for export.

According to the Ministry of Agriculture and Rural Development, in the first half of this year, livestock prices continued to drop and hit the lowest point for the last two years.

According to the Viet Nam Livestock Association, current losses in the livestock sector are estimated to be as high as VND2,000 billion (US$96 million) per month.

In the aquaculture sector, since the beginning of the year, the number of enterprises participating in fisheries exports has fallen by 40 per cent compared to the same period last year, due to losses forcing farmers out of aquaculture.

Investment minister makes official visit to South Korea
 
A Vietnamese delegation led by the Minister of Planning and Investment on Thursday began an official visit to South Korea to strengthen economic and investment cooperation between the two countries.

Besides meeting with top officials, Minister Bui Quang Vinh also plans to visit leading Korean companies with investment in Viet Nam, including Samsung, Kumho Asiana, Posco, CJ and Lotte.

"One of the main purposes of the visit is to further promote investment of leading South Korean groups into Viet Nam," Vinh told Dau Tu newspaper.

Korean enterprises have invested in 3,071 projects with registered capital of US$24.24 billion, ranking second out of countries and territories with investment in Viet Nam, according to the Ministry of Planning and Investment.

Korean investment projects in northern Bac Ninh Province have greatly contributed to the development of the province's key industrial sectors.

As a result, the province has become the centre for telecommunications and electronics of the country, according to Nguyen Luong Thanh, deputy chairman of the Bac Ninh Province People's Committee.

Launched in 2009, the Samsung factory in Bac Ninh Province exported more than $6 billion worth of electronics last year. The figure is expected to reach $10 billion this year.

More than 20,000 labourers have been working at the Samsung factory, with an average salary of VND6 million each, Thanh said, adding that since Samsung had opened its factory in the province, the province had attracted 31 satellite investors with a combined registered capital of $300 million.

Samsung plans to raise its investment capital for its first plant in Viet Nam to $1.5 billion from the original of $670 million to turn the project in Bac Ninh into Samsung Complex, which would specialise in developing advanced technology.

Shim Won Hwan, general director of Samsung Complex, said Samsung pledged to invest long-term in Viet Nam. The company sent a request to the Government to ask for tax cuts for its expansion plan.

Another big Korean group, Kumho Asiana, also plans to expand its tire plant in southern Binh Duong Province and develop a new large-scale property project in Ha Noi.

Similarly, many other Korean groups, including Posco, Lotte, Hyundai, LG and CJ, have been very successful in Viet Nam.

Hong Sun, general secretary of the South Korean Business Association in Viet Nam, said the country had investment potential but should make more efforts to improve the business environment to attract more foreign investors.

Kim Jai Woo, chairman of the Korean Chamber of Commerce in HCM City, said many countries faced difficulties in luring foreign investment.

Woo said Korean businesses would gradually increase investment in Viet Nam when the global economy improves.

Laws on e-commerce fall behind the times

The legal framework for e-commerce needs to be strengthened to cope with the rapid development of the industry, experts have said.

Speaking at a conference in HCM City on Thursday to collect ideas for a new draft decree on e-commerce and the internet, Tran Huu Vinh Binh of the E-commerce and Information Technology Agency (VECITA) said: "A decree issued in 2006 was the first law on e-commerce, but it is basic. [E-commerce] has developed strongly and laws should be amended."

In 2006 e-commerce had been limited due to poor internet infrastructure, but now it has huge potential for development.

A recent Yahoo survey found that in Viet Nam the internet is the most popular source of information, being 2.5 times more popular than television.

But it faces challenges like internet security, human resources, online payment issues, awareness, and lack of laws.

Binh also listed problems like taxing transactions when e-commerce can be done from anywhere in the world, managing group purchases and multi-level trading, and discovering and penalising violations.

"The new decree hopes to provide a transparent legal framework that secures the rights of all beneficiaries, encourages development of e-commerce, helps improve businesses' competitiveness, and develops good e-commerce habits that match international standards."

Lai Nguyet Anh, his colleague, wondered how to manage foreign players who take part in e-commerce in Viet Nam.

"How should we define foreigners – those who have representative offices in Viet Nam or those who register websites with Vietnamese domain names?" she asked.

The draft would allow individuals and organisations to set up websites to trade, and they merely need to inform the Ministry of Industry and Trade, she said. But websites that act as intermediaries, merely providing an environment for others to trade, have to register with the ministry, she added.

But lawyer Phan Thong Anh from the Viet Nam International Arbitration Centre did not want all individuals to be allowed the right to set up e-commerce websites. "To tighten management, only business people should be allowed to open website for trade, and intermediary websites must be licensed by the ministry."

For foreigners doing e-commerce in Viet Nam, in case of disputes, Vietnamese laws must apply, he said.

Hoang Van Son, head of Vina Code, a law firm, said anyone who wants to do multi-level commerce should be asked deposit a huge sum of money to prevent possible fraud.

Property prices to continue decline
 
Apartment prices in Ha Noi could fall even further between now and the end of this year, according to the General Statistics Office, which has reprorted that the capital city currently has a glut of about 3,500 unsold apartment units.

Real estate developer COMA 18 has cut prices for luxury apartments in Westa Tower to VND17.9 million (US$852.3) per sq.m for unfinished units and has joined with the Sudico Property Trading Floor to offer discounts to Westa buyers. The price of one Westa unit on the trading floor was 28 per cent below its initial offering price.

The prices of more affordable apartments has also declined despite higher demand for this class of properties. One apartment in Tan Viet Tower in Ha Noi's Hoai Duc District fell from an initial offer price of VND15 million to VND12-13.5 million ($571.4-642.8) per sq.m.

Viet Nam Real Estate Association general secretary Phan Thanh Mai said current prices were already below the pace of investment, suggesting that the market was in a state of inefficiency. However, a variety of economic pressures were causing real estate developers to reduce prices in order to cut losses and recover capital to service debts, he said.

But Navigat Real Estate Consulting Co director Dang Van Quang suggested that the market has long been inflated and that prices needed to continue declining to put ownership within the reach of more people. Meanwhile, Quang urged property market regulators to review policies on land use rights, land clearance compensation and credit in order to try to reinvigorate the market.

Delta city pulls plug on delayed projects

The authority of Mekong Delta Can Tho City has revoked licenses of eight residential and resettlement projects because of delays in implementation.

Mai Nhu Toan, deputy director of the Can Tho Department of Construction, said the delay of these projects, which cover 320 ha in several districts, had affected the city's economy.

They include a resettlement project invested in by Viet Khang Co; an urban residential area invested in by the House and Urban Area Development group in Ninh Kieu District; an office building and hotel complex project in the South Can Tho area, invested in by Van Phong Co; and a project to build a resettlement area in Phong Dien Town by Thai Nguyen Co.

Other projects include a resettlement area in O Mon District by Hong Loan Co; projects to develop the residential areas in Cai Rang District's Hung Thanh and Phu Thu wards by Nam Truong Son Co; and a new urban area project by Hoa Phat Co in Thot Not District.

Toan said along with the withdrawal of the eight delayed projects, the city would restore the rights of residents affected by these projects.

Meanwhile, the Can Tho Department of Planning and Investment has also asked the Can Tho People's Committee to revoke the licenses for eight other investment projects in social welfare, manufacturing and service sectors. These projects, covering 88 ha, are capitalised at nearly VND1.7 trillion (US$81 million).

Ha Noi approves VNPT Tower

The People's Committee of Ha Noi has, in principle, approved the building of a VNPT tower in Dai Mo Commune, Tu Liem District, Ha Noi.

Developers have already been given the green light from the Ministry of Information and Telecommunications to build on land that managed by the Viet Nam Post and Telecommunications Group (VNPT).

Da Nang land prices remain stable

Da Nang's basic land prices for 2013 will remain at the same level as previous years, according to the Natural Resource and Environment Department of central Da Nang City.

Many projects will be under way to implement site clearances, which will take place in 2013, with basic land prices being agreed upon for the compensation of those currently residing on the land.

More affordable housing to be built

More 1,500 apartments priced from VND1.1 million to VND1.5 million per sq.m will be created for low-income people by the end of this year, according to the Ha Noi Construction Department.

Department director Nguyen The Hung said the new apartments are located in Long Bien and Ha Dong districts.

He added that building work kicks off at industrial zones at the end of this year, and that the construction of apartments for students will commence in the third quarter of 2013.

Ha Noi gets new property price index

The Ha Noi Construction Department will create property price indices for six of the city's districts as requested by the Ministry of Construction.

The indices will be announced during the first quarter of next year with a view to creating favourable conditions for the districts' fluctuating property markets.

They included Dong Da, Thanh Xuan, Ha Dong, Cau Giay, Tu Liem and Hoai Duc districts where property transactions have occurred.

SeaBank offers new letter-of-credit service

SeaBank has launched a product known as L/C UPAS (Letter of Credit Usance Paid at Sight) for local importers.

L/C UPAS is an international payment tool issued by the bank with a low interest rate for deferred payment. With this product beneficiaries will be paid on sight by the bank.

Importers who want to open an L/C may implement deferred payments of up to 180 days.

HSBC launches home loan promotion

HSBC Viet Nam has launched a home loan promotion at an interest rate of 9.99 per cent per year for the first three months of their home mortgage.

The first 10 customers, who sign up for a home loan of VND1 billion ($47,600)) or more from August 23 to November 19 will receive a Samsung Galaxy S3. All new mortgagors will go into a lucky draw for VND175 million ($8,300) worth of Samsung devices.

Garment makers delegation targets US market

Representatives from 12 garment companies are in Las Vegas on a trip that will last until Monday next week.

They are seeking business opportunities in the US, to which Vietnamese exports are expected to top $20 billion by the end of the year.

Last year, Viet Nam's exports to the US reached $16.7 billion, accounting for 17.4 per cent of the country's total export turnover.

Province revokes licence from paper mill project

The People's Committee of the central province of Quang Nam has decided to withdraw its permission to build a paper pulp mill, which would have been capitalised at VND3.1 trillion (US$148 million).

The mill in Tam Dan Commune, Phu Ninh District, was to be built by Incomex Paper Pulp and Paper Joint Stock Co (IPP) to produce 115,000 tonnes a year.

The investor has failed to contribute 20 per cent of the project's total investment capital after six years of receiving its investment licence.

Viet Nam's top 10 retailers announced

Singapore's Retail Asia Magazine has announced its top 10 Viet Nam retailers for 2012.

The firms are Sai Gon Jewellery Company (SJC), Sai Gon Co.op, Phu Nhuan Jewellery Company (PNJ), Nguyen Kim electronics supermarket chain, Mobile World, Big C supermarket chain, Parkson supermarket chain, HCM City Book Distribution Corp (Fahasa), Vien Thong A mobile phone chain and TCT group.

The list was based on business results of companies in 14 countries and territories. Fahasa was also named in the top 500 Asia-Pacific retailers in 2012. Last year, its turnover reached VND1.4 trillion ($66.6 million), a 10 per cent year-on-year increase, despite the economic recession.

Currently, the distributor has 56 bookstores throughout the country.

Capital markets lack sufficient transparency

Transparency of the capital market remains poor and mechanisms, management capacity and market surveillance are not sufficient, thus impeding capital development and capital mobilisation, both domestically and internationally, said experts.

The assertion was made at a two-day seminar entitled "Development of capital markets in restructuring the financial system in Viet Nam", held by the National Financial Supervisory Committee with participation of over 100 delegates including finance managers, researchers, and domestic and international investors.

The seminar concluded yesterday afternoon in central Nha Trang City, Khanh Hoa Province.

Speaking at the seminar, deputy director of auditing services for Ernst & Young Viet Nam Tran Phu Son said businesses needed to make their financial information more transparent to attract investment capital.

Chairman of the National Financial Supervisory Committee Vu Viet Ngoan said improving the quality of information in prospectuses, especially for newly-listed companies, was required as prospectuses help investors make their profitability assessments and create their prospects of listed companies before finalising their decision to invest or not.

A decision based on a lack of information or inaccurate information would cost investors dearly, though newly-listed companies would suffer immediate loss regarding capital mobilisation and an inability to attract strategic investors.

Accordingly, poor prospectuses, especially those of companies with large capitalisation, could lead to a decline of faith and public confidence, creating disorder in the finance market.

Le Duc Tho of the Viet Nam Bond Market Association (VBMA) said he wanted to ask the authorised bodies to allow the VBMA to be involved in market development activities, including developing standard training programmes and market conventions.

The VBMA wants to become a centre of corporate bonds specialising in collecting and processing any information regarding transactions and performance in secondary and primary markets.

Viet Nam is now home to 105 securities companies and 47 investment fund management companies, with more than 700 listed companies with a market capitalisation accounting for 40 per cent of the country's GDP.

Also at the seminar, Mark Cassidy, head of the Monetary Policy Division and senior economist in the Statistics Division of the Central Bank of Ireland, shared his experiences with a talk entitled ‘Capital Flows into Ireland: Recent Experience and Policy Lessons'.

Ha Noi bourse lists T-bills

The Ha Noi Stock Exchange launched a treasury bill trading system yesterday in co-ordination with the State Treasury, the State Bank of Viet Nam and the Viet Nam Securities Depository. The system will allow treasury bills to be sold via bidding through the State Bank, deposited at the depository centre, and listed on the exchange's bond trading board.

"With a maturity of less than one year, suitable to currency trading activities of commercial banks, treasury bills are expected to become very alluring," said the exchange's general director, Tran Van Dung.

The introduction of treasury bills onto the bond market would not only offer benefits to investors but also give agencies an effective tool in managing the market, he added.

Listing T-bills would help overcome the segmentation between short – and long-term capital markets.

With the bills listed starting yesterday, the exchange would be in a position to improve the benchmark yield curve for bonds in order to provide more comprehensive and diverse information for investors and monetary policymakers, Dung said.

A number of banks, including VPBank and Military Bank, have also suggested that the secondary market in T-bills would not only offer safe investments but would also help create a standard yield level for the monetary market.

Depository Centre deputy director Tran Minh Hang noted that the liquidity of T-bills had previously been limited, and she hoped the new system would boost the liquidity of both T-bills and the bond market in general. The settlement of bills would be made by multilateral clearing, with a transaction-plus-one-day (T+1) payment date, Hang said.

With treasury bills totalling VND10 trillion (US$476 million) and listed Government bonds having a value of VND337.9 trillion ($16 billion) last year, the public debt market now accounted for 14 per cent of gross domestic product, noted Deputy Minister of Finance Tran Xuan Ha.

"The ministry is now focused on developing the Government bond market – a key to financial market restructuring," Ha said.

Dragon Capital director Dominic Scriven recommended administrative agencies offer favourable conditions for foreign investors to buy T-bills, e.g., tax exemptions for bond and T-bill investments. He said that there should be no interference in the yields in order to accurately reflect the cost of capital in light of inflation and monetary policy.

CPI inches up during August

The Consumer Price Index (CPI) in August increased by 0.6 percent over last month, the General Statistic Office (GSO) announced on August 24.  

Nguyen Duc Thang, Director of the GSO’s CPI Department, attributed the increase after two consecutive months of decline was due to the hike in world petroleum and gas prices or 10 percent and 8 percent respectively.

The healthcare and medical sector saw the highest increase of 5.44 percent, followed by housing and building materials, (up 2 percent), and transportation services, (up 1.07 percent) on the effects of the petroleum price hike.

The only decrease was experienced by the foodstuffs and restaurant services sector, down 0.47 percent because of abundant supply and a bumper harvest in the Red River and Mekong Delta. This would reduce purchasing power as the items accounted for 40 percent of the CPI basket.

Month-on-month price increases, ranging from 0.35 percent to 1 percent, were recorded for the sectors of beverage and cigarettes, garments and textiles, footwear, household goods and entertainment.

The gold price rose 0.41 percent while the price of the US Dollar decreased 0.15 percent over last month.

Thang said the CPI would continue to surge as the country came into a peak period of consumption, with the advent of the mid-autumn festival, new school year and Christmas.

“However, the increase would not be high, driving the year-on-year CPI at 6-7 percent as set by the Government, he said.

Nguyen Tien Thoa, head of the Finance Ministry’s Price Management Department, said the ministry on August 23 received proposals to increase retail petroleum prices from two businesses, Dong Thap Petroleum Trading Company ad Petec Trading and Investment Corporation.

The highest rise was VND1,200 (5.7 cents) per litre of petrol and VND700-800 (a round 3.3 cents) per litre of oil.

The proposal followed a rise in world oil prices, which had caused the businesses to suffer losses.

Vietnam ranks third in Asian Consumer Confidence

Vietnam ranks third in Asian Consumer Confidence, after India and China, according to the latest MasterCard Worldwide Index for Consumer Confidence.   

Consumers in the region remain most optimistic in the markets of India (82.1 Index points), mainland China (77.4), Vietnam (77.2) and Thailand (75.8), while the least optimistic markets are Japan (23.6), Taiwan (25.7) and Australia (39.2).

Hong Kong, which dropped 38.7 points in the last Index, improved by 21.9 points to lead the region, followed closely by the Republic of Korea (up 21.4 points), Malaysia (up 17.1 points) and New Zealand (up 15.3 points).

Indonesia recorded the single largest fall in consumer confidence (down 18.7 points) followed by the Philippines (down 11.8 points). Consumer confidence in the economy plummeted in Indonesia (from 74.9 to 33.3 points), with employment also falling from 70.6 to 40.8 points.

Overall, nine out of 14 Asia/Pacific markets polled recorded positive improvements when compared to the second half of 2011, with a regional rise from 52.1 points in the second half of 2011 to 57.2 points in the first half of 2012. The index is based on a survey conducted between April 24, 2012 and June 10, 2012 on 11,376 respondents aged 18-64 in 25 countries within the Asia/Pacific, Middle East and Africa. This is the 39th survey of consumer confidence conducted since 1993.

Dr. Yuwa Hedrick-Wong, global economic advisor at MasterCard Worldwide, said Vietnam has been a major beneficiary of low-end manufacturing relocating from China in the recent past.

Capital markets lack sufficient transparency

Transparency of the capital market remains poor and mechanisms, management capacity and market surveillance are not sufficient, thus impeding capital development and capital mobilization, both domestically and internationally, said experts.

The assertion was made at a two-day seminar entitled "Development of capital markets in restructuring the financial system in Viet Nam", held by the National Financial Supervisory Committee (NFSC) with the participation of over 100 delegates including finance managers, researchers, and domestic and international investors.

Speaking at the seminar, which concluded on August 24 in central Nha Trang City, Khanh Hoa Province, Deputy Director of Auditing Services for Ernst & Young Vietnam, Tran Phu Son said businesses needed to make their financial information more transparent to attract investment capital.

Chairman of the National Financial Supervisory Committee Vu Viet Ngoan stressed the need to improve the quality of information, which helps investors make their profitability assessments and create their prospects of companies, especially newly-listed ones, before finalizing their decision to invest or not.

A decision based on a lack of information or inaccurate information would cost investors dearly, though newly-listed companies would suffer immediate loss regarding capital mobilization and an inability to attract strategic investors.

Accordingly, poor prospectuses, especially those of companies with large capitalization, could lead to a decline of faith and public confidence, creating disorder in the finance market.

Le Duc Tho of the Vietnam Bond Market Association (VBMA) said he hopes authorities to allow his association to be involved in market development activities, including developing standard training programs and market conventions.

The VBMA wants to become a centre of corporate bonds specializing in collecting and processing any information regarding transactions and performance in secondary and primary markets, he said.

Vietnam is home to 105 securities companies and 47 investment fund management companies, with more than 700 listed companies with a market capitalization accounting for 40 percent of the country's GDP.

Agricultural, forestry, aquatic exports up 10 percent

Total agricultural, forestry and aquatic exports in the past eight months US$18 rose 10 percent to US$18 billion.    

Some key items, such as coffee, rice and rubber saw remarkable growth in both volume and value.

Coffee fetched nearly US$2.7 billlion, rice US$2.5 billion and rubber more than US$1.7 billion, respectively.

Mechanism for petrol ceiling prices should be scrutinized

It is imperative to reconsider the mechanism for adjusting petrol prices to limit the negative impacts of rising prices in the current economic situation, say economic experts.     

Petrol businesses are continuing to ask for new price increases. Imported petrol stood at just below US$120 per barrel from July 23 to August 6 but petrol prices rose between August 6-13, which resulted in fluctuations of domestic prices.

Businesses have only been allowed to increase prices less than 7 percent and that move is on the right track.

Experts say that the crux of the matter is controlling production costs for enterprises and fixing a profit of VND300 per litre for wholesalers is unreasonable. If petrol prices are controlled under a market-based mechanism, petrol businesses will face the risk of losing their profits.

Economic expert Vu Dinh Anh says it is essential to change the way the petrol market and prices are controlled and create a mechanism for establishing a ceiling for petrol prices to benefit consumers.

Banks offer incentive loans to livestock, fisheries sectors

The State Bank of Vietnam (SBV) has asked five major commercial banks to prioritize loans and debt extensions for farmers and enterprises in the livestock and fisheries sectors.
    
The Vietnam Bank of Agriculture and Rural Development (Agribank), Bank for Investment and Development of Vietnam (BIDV), Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), Bank for Foreign Trade of Vietnam (Vietcombank) and Mekong Delta Housing Bank (MHB) will now have to lower interest rates on loans for these farmers and enterprises to a maximum level of 11 percent per year — the lowest market interest rate at present.

Customers facing difficulties in their business and production could be given another two years to pay back debts, as requested by the central bank.

The move aims to help struggling farmers in the sector in the wake of disease outbreaks, falling prices and capital shortages.

Priorities are given to households, co-operatives and enterprises raising, slaughtering and processing livestock, poultry and tra fish for export.

According to the Ministry of Agriculture and Rural Development, in the first half of this year, livestock prices continued to drop and hit the lowest point for the last two years.

According to the Vietnam Livestock Association, current losses in the livestock sector are estimated to be as high as US$96 million per month.

In the aquaculture sector, since the beginning of the year, the number of enterprises involving in fisheries exports has fallen by 40 percent compared to the same period last year, due to losses forcing farmers out of aquaculture.

E-commerce laws need to be amended

The legal framework for e-commerce needs to be strengthened to cope with the rapid development of the industry, experts have said.   

Speaking at a recent conference in Ho Chi Minh City to collect ideas for a new draft decree on e-commerce and the internet, Tran Huu Vinh Binh of the E-commerce and Information Technology Agency (VECITA) said “A decree issued in 2006 was the first law on e-commerce, but it is basic. E-commerce has developed strongly and laws should be amended.”

In 2006 e-commerce had been limited due to poor internet infrastructure, but now it has huge potential for development.

A recent Yahoo survey found that in Vietnam the internet is the most popular source of information, being 2.5 times more popular than television.

But it faces challenges like internet security, human resources, online payment issues, awareness, and lack of laws.

Binh listed problems like taxing transactions when e-commerce can be done from anywhere in the world, managing group purchases and multi-level trading, and discovering and penalizing violations.

"The new decree hopes to provide a transparent legal framework that secures the rights of all beneficiaries, encourages development of e-commerce, helps improve businesses' competitiveness, and develops good e-commerce habits that match international standards," he said.

Lai Nguyet Anh, his colleague, wondered how to manage foreign players who take part in e-commerce in Vietnam.

”How should we define foreigners – those who have representative offices in Vietnam or those who register websites with Vietnamese domain names?” she asked.

The draft will allow individuals and organizations to set up websites to trade, and they merely need to inform the Ministry of Industry and Trade, Anh said. But websites that act as intermediaries, merely providing an environment for others to trade, have to register with the ministry, she added.

Lawyer Phan Thong Anh from the Vietnam International Arbitration Centre did not want all individuals to be allowed the right to set up e-commerce websites. To tighten management, he said, only business people should be allowed to open website for trade, and intermediary websites must be licensed by the ministry.

For foreigners doing e-commerce in Vietnam, in case of disputes, Vietnamese laws must apply, he said.

Hoang Van Son, head of Vina Code law firm, said anyone who wants to do multi-level commerce should be asked deposit a huge sum of money to prevent possible fraud.

Vietnam, RoK boost green growth cooperation

Vietnam and the Republic of Korea have signed a memorandum of Understanding (MoU) on green growth cooperation.
    
The MoU was signed in Seoul on August 24 by Minister of Planning and Investment Bui Quang Vinh and Chairman of the Korea International Cooperation Agency (KOICA) Park Dae-won.

Minister Vinh highly valued the RoK Government’s non-refundable aid channeled to Vietnam through KOICA, reaching up to US$20 million per year.

He said he hopes KOICA will continue assisting Vietnam in implementing the three key pillars proposed in the Vietnam-RoK Cooperation Program – infrastructure, human resources development and green growth.

He asked KOICA to cooperate with the Minister of Planning and Investment (MPI) to deploy prioritized projects on economic management and public-private partnerships (PPPs).

KOICA Chairman Park Dae-won pledged support for Vietnam’s green development and human resource training projects.

He said that the RoK Government and KOICA consider Vietnam an important and reliable partner in non-refundable aid.

On the same day, Minister Vinh met with President of the Korea Development Institute (KDI), Oh-Seok Hyun.

He also witnessed the signing of an expanded Knowledge Sharing Program (KSP) project between the KDI and the MPI Development Strategy Institute.

Vinh called on the KDI to help train Vietnamese officers in macro-economic analysis and forecasting, economic restructuring, and foreign investment policy.

Fertiliser industry to boost sales in ASEAN

The fertiliser industry expects to boost shipments to Southeast Asian markets in the second half of the year, according to a leading executive in the industry.

PetroVietnam Fertiliser and Chemicals Corporation (Phu My Fertilisers) Deputy Director Nguyen Hong Vinh said that Vietnam has a geographical advantage over major producers in the Middle East and Baltic regions and domestic producers should turn that edge into an opportunity to enlarge their market share in ASEAN countries.

After opening a branch in Cambodia last year, Phu My Fertilisers intended to open a representative office in Myanmar this year to better exploit the potential of that growing market, Vinh said.

The corporation exported 50,000 tonnes of fertiliser to Cambodia, the Philippines and Myanmar in the first half of the year, he noted.

It aims to export roughly 300,000 tonnes annually to ASEAN markets within the next few years, with those markets being expected to ultimately account for 25 percent of its total sales.

Bianfishco pledges to clear farmers dues by September

On the morning of August 25, Binh An Seafood Joint Stock Company (Bianfishco), the Saigon Hanoi Commercial Joint Stock Bank (SHB), and the Debts and Assets Trading Corporation under the Ministry of Finance (DATC) held a press conference to announce that from now on SHB will be involved in restructuring all activities of Bianfishco.

Tran Van Tri, CEO of Bianfishco, said that though it took a long time to submit all required documents and complete necessary procedures, Can Tho City has now officially certified a new business registration license for the Binh An Seafood Joint Stock Company (Bianfishco).

The new license stipulates that Saigon Hanoi Commercial Joint Stock Bank, which is the largest shareholder with 50 percent stake, will oversee operations of the company from now on.

Tri added that as per the new license, he is the legal representative of the company, replacing his wife Pham Thi Dieu Hien, former director of Bianfishco. Furthermore, he will prioritize repayment of all farmers back debts, who had not yet received payments for catfish they had sold to Bianfishco many months ago.

The two sides also reached an agreement on mode of repayment so that farmers do not agitate in front of the villa and shout slogans or make loud protests over loudspeakers to demand their money.

Informing relevant agencies and business partners, Tran Van Tri said that since the company began operations in 2005, Bianfishco has invested in fish processing plants with modern technology, such as   cold storages, research institutes, and export of products.

Given the effects of the economic crisis, Bianfishco met with difficulties in repaying loans after it expanded and invested in many projects and has been able to only clear upto VND700 billion in dues this year.

In addition, several banks refused credit to Bianfishco, which led to a stalemate in further production and hence Bianfishco was unable to pay back farmers.

On behalf of the company, Tri apologized to farmers and partners for holding on payments that he had promised many times to repay but could not afford due to ‘incomplete administrative procedures’.

Bianfishco will hand over its fish processing plant to the farmers to whom it owes hundreds of billions of dong if it misses payment deadline in October, promised Tri.

Soon the company will have cash to repay the farmers, and join hands with Debts and Assets Trading Corp and other banks to streamline debt clearance procedures and bring the company back on track, Tri added.

The debt-stricken fishery company officially restarted operations at its catfish processing and export plant in Tra Noc Industrial Park in Can Tho City on May 9, 2012.

The company still owes farmers VND200 billion for catfish purchase.

Nguyen Quang Tuyen, a fish farmer in Can Tho, said, "the restructuring of operations of Bianfishco is very good news. However, many fish farmers hope that the company will clear debts together with interest.”

As the largest shareholder of Bianfishco, Nguyen Van Le, CEO of SHB, made a commitment that in the coming weeks the company will invite farmers to declare their debts and by September, will clear at least 30 percent of the loans.

Le said that in addition to clearing debts, SHB and shareholders and related industries will quickly set a plan to restructure company operations.

Accordingly, SHB and DATC will involve in the management and administration of all activities of Bianfishco, including business, finance, cost control, inputs and outputs.

SHB will continue disbursement of capital to Bianfishco to buy additional raw material and for working capital. At the same time, negotiations with major creditors such as the Vietnam Development Bank (VDB), Bank for Investment and Development of Vietnam (BIDV) will be carried out to convert debt into equity; organize shareholders to increase capital from VND500 billion to 1,200 billion and to strengthen the financial capacity of the company.

According to Nguyen Van Le, after comprehensive restructuring, the company hopes to run smoothly by 2013.

Ho Chi Minh City focused on market stability

At a meeting to review the socio-economic situation of Ho Chi Minh City in the first eight months of the year on August 25, Le Hoang Quan, Chairman of the HCMC People's Committee asked all relevant departments to help resolve difficulties faced by businesses so as to once again buoy markets.

In particular, he said that after the gasoline price hike, authorities should focus on cost management, and not tolerate any fluctuation in prices for the remaining months of this year.

Due to huge demands for consumer goods, authorities should strengthen inspections and prevent unsafe goods coming into the City from neighboring provinces.

"Toxic fruit and vegetables are being sold on City streets which authorities must put an end to,” said Chairman Quan.

Relevant agencies need to strengthen inspection of industrial meals that are being served to workers, and the Department of Health must direct preventive health centers, hospitals and districts to propagate awareness of disease prevention in people; and concentrate on anti-mosquito measures, particularly in disadvantaged areas.

“Prevention and control of disease has been greatly overlooked,” said a worried Hua Ngoc Thuan, Vice Chairman of the HCMC People's Committee.

According to the HCMC People's Committee, the socio-economic situation has begun to show positive signs. In August, production and business activities of small and medium enterprises have recovered in some ways, though the results are not as expected.

The numbers of businesses listed to register or expand have also increased.

However, HCMC still faces many difficulties. Total sales of retail goods and services increased merely 8.9 percent, compared to 23.9 percent during the same period last year; development index of industrial production increased only 2.8 percent over the same period; and budget revenue is down 0.8 percent over the same period.

Meanwhile, the disbursement of investment and development is slow, only 43.4 percent in 8 months. Price index in August rose again after two months of continuous reduction and raised the alarm that inflation could return.