Rice exports hit more than US$3.2 billion

Vietnam exported 6.38 million tonnes of rice, worth US$3.22 billion, in the past 10 months of this year.

According to the Ministry of Agriculture and Rural Development, Asia was the largest consumer of Vietnam’s rice, making up around 64 percent of the country’s exports. It was followed by Africa, with 25 percent and America, 7 percent.

The Mekong delta - the country’s rice basket - has so far this year shipped abroad 5.8 million tonnes for more than US$2.8 billion.

The country’s rice output is estimated at 22.8 million tonnes this year, almost 1.3 million tonnes more than the 2010 figure.

Vietnam, Russia target $5 bln in trade by 2015

Vietnam and Russia have agreed to double two-way trade to $5 billion by 2015 thanks to significant steps of development in bilateral relations, which was lifted to the strategic partnership ten years ago.

The target was set at the first meeting between the co-chairmen of the Vietnam-Russia Inter-Governmental Committee on economic trade and scientific and technological cooperation since the mechanism was upgraded to deputy prime minister level.

At the meeting, Deputy Prime Minister Hoang Trung Hai and First Russian Deputy Prime Minister Shuvalov worked on measures to promote bilateral trade towards the target, including starting early negotiations, establishment of a free trade area between Vietnam and the Customs Union, including Russia, Belarus and Kazakhstan, and implementation of the policy to promote import and export of their products.

They discussed and agreed on important measures to boost the traditional friendship, strategic partnership and comprehensive cooperation between the two countries.

The two Deputy PMs were pleased with expanding investment between Vietnam and Russia , and committed to continue to encourage and create favourable conditions for the two countries’ firms to invest in each other’s markets.

They emphasised the role of energy cooperation, considering it as a key, strategic cooperative field for development of both countries as well as for bilateral ties.

They expressed their pleasure with development of bilateral cooperation in oil and gas, particularly the smooth and efficient operations of the Vietsovpetro oil and gas joint venture, the newly established Rusvietpetro, Gazpromviet and Vietgazprom joint ventures in Vietnam, Russia and third countries.

The two deputy PMs affirmed that nuclear energy is among strategic, potential and promising cooperative areas between Vietnam and Russia .

Deputy PM Hai spoke highly of the signing of the agreement on Russia’s provision of credit to Vietnam to build the Ninh Thuan 1 nuclear power plant and Russia’s funding for the project’s feasibility report.

Both sides also agreed to cooperate in building a nuclear science and technology centre in Vietnam.

They agreed on a series of measures to increase bilateral cooperation in industry, finance, banking, agriculture, telcom, science and technology, education and training.

The two sides agreed to step up cooperation within the ASEAN-Russia cooperative mechanism framework and the Asia-Pacific Economic Cooperation (APEC) forum in the context of Russia hosting the APEC Summit in 2012.

After the meeting, the two Deputy PMs signed documents on their meeting and witnessed the signing of cooperative documents in industry, finance and credit, nuclear technology and agriculture.

Also the same day, First Russian Deputy Prime Minister Shuvalov was separately received by General Secretary Nguyen Phu Trong and President Truong Tan Sang.

The Russian Deputy PM affirmed the Russian government always attaches importance to developing the strategic partnership with Vietnam and expressed his belief that with both sides’ efforts, all-round cooperation will be further promoted and developed in future.

The Vietnamese leaders hailed outcomes of the Russian Deputy PM’s working visit, saying that these will make practical contributions to deepening the two countries’ ties, particularly as they celebrate the 10th anniversary of their strategic partnership.

Trade promotion week starts

A six-day Kon Tum investment promotion conference, a border trade fair and a West-East Economic Corridor development conference began yesterday in the Central Highlands province of Kon Tum.

The fair and the conferences are part of many events to commemorate the 100th anniversary of Kon Tum Province. They are chances for enterprises to seek opportunities, preferential policies and investment in the province.

Kon Tum aims to attract more investment in tourism development. Up to now, the province has approved 192 investment projects worth VND26.35 trillion (US$1.25 billion).

Manulife receives ISO certification

Life insurance provider Manulife Viet Nam yesterday received the ISO 9001:2008 certification.

The company has become the first life insurance provider in Viet Nam to get the ISO certification for overall operations issued by Bureau Veritas.

Since the Canadian company set up office in Viet Nam in 1999, it has served 300,000 customers nationwide.

Military Bank gains on target

Military Bank (MB) posted a net profit of VND2.16 trillion (US$103 million) in the first nine months of the year, equivalent to 75 per cent of its target. Total earnings reached over VND1.93 trillion ($93 million) during the period with a surge in revenue of VND652 billion ($31 million) over the same period last year.

MB said it had implemented solutions to increase the safety level of bad debt at 1.6 per cent, which was much lower than the banking sector's average, while retaining liquidity targets.

Its management board decided to pay 12-per-cent dividends this year to ensure its commitment with shareholders and investors. It has also mobilised resources to help Thang Long Securities to stabilise its operation.

43 real-estate projects face axe

The Ministry of Planning and Investment has requested the Central Highlands province of Lam Dong's People's Committee to revoke the licences of 43 real-estate projects.

Investment licences and land use rights are being revoked because investors did not begin working on the projects within one year of receiving their licences.

By the end of last year, 144 real-estate projects were given a nod to invest in the province with a total registered investment capital of VND31.8 trillion (US$1.5 billion), but only VND1.67 trillion ($80 million) was implemented.

Co.opMart increases stocks

Co.opMart supermarket chain has announced plans to increase its stock of essential goods by four times to 24,000 tonnes at a total cost of VND2.8 trillion (US$134 million) for the upcoming Tet holiday in comparison to other months to meet holiday demand.

The company expects to welcome three to four times more customers per day than normal during the holiday period.

Domestically produced goods are expected to account for 95 per cent of goods in the supermarkets during the holiday.

Co.opMart plans to inaugurate five new supermarkets and four food shops in HCM City's industrial parks and suburban districts before the Tet holiday.

French firms to lift water sector liquidity

A delegation of 10 French companies will be in Vietnam from tomorrow, November 22, to November 26 to boost their involvement in Vietnam’s water sector through “Espace France”.

Espace France is organized by UBIFRANCE Vietnam and is part of the VIETWATER 2011 exhibition that will be held at the Exhibition Centre of Saigon.

The 10 French companies include ALTEREO, BRGM, EGIS INTERNATIONAL, FRANCEAUX, GROUPE SCE, LACROIX-SOFREL, NANTAISE DES EAUX INGENIERIE, SADE, SOGEMAP and THETHYS INSTRUMENTS. Some are already based in or active in Vietnam.

The event will be hosted by Vietnam Water Supply and Sewerage Association.

This French participation aims at strengthening the relations between French and Vietnamese entities and companies in the water sector, and at developing sustainable commercial, industrial or technological partnerships. The French companies will get the opportunity to improve their understanding of the Vietnamese authorities’ policy in the sector.

They will also learn about the key projects and about how to take part in these projects as foreign suppliers and investors.

VIETWATER 2011 is the country’s biggest water industry event where industry professionals converge to get updated on the latest trends and developments, source new products and build partnerships. More importantly, it is where over 10,000 buyers and decision makers look for practical solutions and answers on water and wastewater management.

With over 280 exhibiting companies from 32 countries and pavilions from Singapore, Hungary, Denmark, China, Taiwan, Korea, Belgium, this event is backed by a top industry conference. There will over 25 technical presentations and a total of 5,673 trade visitors including 2,228 overseas delegates registered for the three-day event.

Opportunities in Vietnam’s water sector are numerous and predicted to grow strongly.

With an average Goss Domestic Product (GDP) growth of over 7 per cent per year for the last 20 years, a population growing by about 1 million per year (100 million inhabitants estimated for 2020 against 87 million today), an outstanding urbanisation rate (a predicted 45 per cent in 2020 against 30 per cent in 2010) and an industrial production growth at double GDP growth, Vietnam offers huge potential.

The water sector is a priority for the government which has also set ambitious objectives for 2020: supply of safe drinking water to 100 per cent of the urban population, treatment of 80 per cent of sewage and reduction of the leakage rate within the system, which is currently at over 30 per cent.

These French companies, whose experience and know-how are internationally known, will have the opportunity to meet bilateral and multilateral donors (Japan International Cooperation Agency, World Bank, Asian Development Bank) in Hanoi to increase their understanding of the needs of the Vietnamese water sector.

They will also be in a position to offer their advanced technologies and services to Vietnamese counterparts and policy makers during the VIETWATER 2011 exhibition.

Firms urged to sign up for brand protection

A lack of attention to brand value protection is hurting local firms.

The ‘Snowbell leaf’ branded vegetarian noodle products of Binh Tay Foodstuff Joint Stock Company have been shipped to countries around the world such as the US, Canada, Australia, France, Germany and Hong Kong.

But the company recently discovered the brand was being illegally registered and used by a Chinese firm anchored in the US.

“Foreign customers may lose confidence in our products because of the Chinese firm’s actions which could stain our image and put a dent on our profits. Therefore, Binh Tay has engaged in a lawsuit against the Chinese firm though we know this will be very costly,” said the firm’s chairwoman Le Thi Giau.

Earlier, Ho Chi Minh City-based Kem Nghia JSC – a prestigious hand nail nippers and associated products maker – saw its Nghia nippers brand stolen by a Chinese firm.

According to the company’s foreign trade department head Pham Ngoc Anh, in 2007 the firm linked up with a Chinese partner who was assigned exclusive rights for Kem Nghia product distribution in the Chinese market.

Cooperation between both sides collapsed in 2008, however, and Kem Nghia teamed up with another Chinese distributor. However, the firm later realised its former Chinese partner continued illegally using Nghia nippers brand name in transactions.

“After learning our brand was illicitly used, we altered our product packaging and resorted to Chinese media support to announce the new brand name ‘Nghia cuts’ to Chinese customers,” said Anh.

To minimise brand-related risks, Kem Nghia resorted to Pham & Associates Lawyer Office support to register for brand protection in 20 countries worldwide.

In another case, Southern Rubber Industry JSC (Casumina) deputy general director Le Van Tri said its Gold Star tube products not only saw their brand name used illegally by other firms but the products were also imitated in the Chinese market. Dealing with these issues reportedly ate up much of the firm’s capital and cost a great deal of effort.

“We work with market watchdog teams to deter counterfeit goods from crossing border gates. In the home market wherever fake goods are sold, our employees put up posters making clear real product specifications and quality standards to help consumers differentiate between real and fake goods,” said Tri.

But with a slew of local firms potentially losing their trademarks to the hands of illegal foreign firms, Ho Chi Minh City Lawyer Association’s VNC Lawyer Office head Hoang Van Son said to shield their rights and interests in the short term local firms should define major areas where their products are sold and register for brand protection in these areas. In areas falling within the realm of common market agreements such as EU and ASEAN or free trade areas (FTA), local firms only have to register with one country in these areas.

“Firms should not wait until they grow famous to register for brand protection,” Son said, adding that in principle the Law on Intellectual Property gives priority to people who earlier register, therefore firms, having their brands stolen, often have to negotiate with violators first. If negotiations drop, they can file lawsuits against defendants at very costly charges.

VN-Chile FTA opens doors

Domestic exporters expect to accelerate shipments of products to Chile in the wake of the recent signing of a Free Trade Agreement (FTA) between the two countries.

Viet Nam and Chile signed the FTA earlier this month. Under the agreement, 83.54 per cent of Vietnamese goods to Chile will be exempted from the tax.

Vietnamese ambassador to Chile Ha Thi Ngoc Ha forecast that Viet Nam's export turnover to the market would increase sharply after the deal compared to the current modest figure.

Viet Nam's exports to Chile reached nearly US$400 million last year from $20 million in 2000, he said. The export value in the first nine months of the year was nearly $400 million.

Chile is considered a potential market for Vietnamese goods, particularly textiles and garments, footwear, seafood and woodwork products. However, prior to the agreement, exports remained insignificant due to Viet Nam's difficulty in competing against significantly cheaper Chinese alternatives.

The tax exemption under the FTA is expected to make Vietnamese products more competitive in the Chilean market.

Deputy director of the Viet Tien Garment Co Phan Van Kiet said that domestic textile and garment exporters would boost trade promotion activities in the Chilean market to take advantage of the zero-tax policy.

The Protrade Garment Co in the southern Binh Duong Province, which has offered products to Chile in the past but failed to find success due to competition with cheaper products from China, plans to resume shipping products to the market in the wake of the tax exemption.

Property firms profit despite discounts
 
Apartment prices have fallen an average of 30 per cent compared to previous years, but developers can still sell their properties at a profit.

For example, two weeks ago, the Hoang Anh Gold House project in Nha Be District sold 300 of its 500 apartments at a price that was 25 – 35 per cent lower than the 2009 price.

In mid-2009, the Hoang Anh Gia Lai company sold the Hoang Anh Gold House project to another investor (a company belonging to the Bank of Investment and Development Viet Nam (BIDV). They then sold it to Sai Gon Mekong company.

Although the apartment project cost VND13.1 million (US$650) per sq.m originally, it still sold for VND14.4 million ($710) per sq. m two weeks ago.

A similar situation occurred with PetroViet Nam Power Land Joint-Stock Company.

The company discounted by 30 per cent the price on 85 apartments in its flagship PetroViet Nam Landmark project to VND15.5 million per square metre.

They did so because they needed to begin repaying a VND100 billion ($4.8 million) bank loan.

PetroViet Nam had purchased this project from another investor. But even so, the eventual profit was VND3.2 million per square metre.

In February 2009, many people in HCM City's real estate market were shocked to see a 45 per cent cut in price on apartments for Hoang Anh River View in District 2 and Phu Hoang Anh in District 7.

However, even after the drop in price, investors still made $1,000 profit on each square metre.

According to Hang Quang Huy, director of Nha Viet company, the real estate market in HCM City is expected to set lower prices on property because investors cannot keep their projects for a long time with interest rates of an average 20 per cent per year.

"Apartment investors have become victims because they speculated in a lot of apartments and they can't sell. But they are the people who caused the situation," said Dinh The Hien, a financial expert.

He pointed out that in 2006, the price of each square metre of agricultural land in District 9 was only VND500,000 ($24).

But the price increased five to six times after land plots were sold several times to different investors. Investors of apartment projects did not want to reduce prices.

At that time, it was difficult to define the real price for each project, he said.

"The apartment market should reduce prices by 30 – 50 per cent, to establish the real value. At this price, the market will meet customer demand. They need an apartment to live, not to sell," Hien said.

Professor Dang Hung Vo, former deputy minister of the Ministry of Natural Resources and Environment, agreed with Hien.

"The standard to define the real value of an apartment should be based on the price of land, construction and project management expenditures, including reasonable benefits for investors, not as it was done during the previous land fever," he said.

Vo suggested that luxury apartments in HCM City should be priced at VND15-20 million per square metre, while mid-range apartments should be half of that amount.

‘Illogical' transfer tax faces change

Viet Nam Association of Financial Investors (VAFI) has proposed the Ministry of Finance amend the securities transfer tax regulation against foreign investors, according to a news release yesterday on the association's website.

VAFI cited Point 1 in the Document No 12501/BTC-CST issued on September 20, 2010, classifying the transfer of securities and capital against the transfer of stakes in public companies and joint stock companies.

The transfer conducted by institutions and individuals at public companies is defined to transfer securities and this kind of transfer bears securities transfer tax.

The other transfer conducted by institutions and individuals at joint stock companies is regulated to bear capital transfer tax.

Based on these definitions, foreign investors, who do set up their own companies in Viet Nam are forced to pay 25 per cent of revenue for their transfers in joint stock companies, and 0.1 per cent revenue for their transfers in public companies.

"The classification is irrational and illogical, pursuant to Enterprise Law and Securities Law," said Nguyen Hoang Hai, VAFI's general secretary, adding that the difference between joint stock companies and public companies was the number of shareholders while the basic features of the two types of companies were the same.

Hai said indirect foreign investors should not be levied the 25 per cent transfer tax because the business of these investors was diversified in models, scales, locations and business segments and these investors did not make frequent business in Viet Nam.

"Therefore, how can the tax collector calculate total expenses when they levy 25 per cent transfer tax per transaction by these investors?" Hai said.

Dominic Scriven, Dragon Capital's CEO, while refusing to give direct comments on the VAFI proposal, said the first issue the Government needed to do was to synchronise tax policies before considering tax privileges.

"Inconsistent policies cause unfairness in the market," he said.

"Subsequently, if there is an investment tool to attract long-term investment for the sake of the economy and the country, tax privilege should be considered as the tool."

VN set to reach farm export target
 
Viet Nam's agricultural, forestry and fishery industry has overcome both production and business challenges to reach its export value target for the year, experts have said.

The Viet Nam Association for Seafood Exporters and Producers (VASEP) said that the economic crisis in Europe had greatly affected payments to Vietnamese seafood exporters while the price of raw materials related to processing had increased sharply due to low supply.

General Director of the Van Duc Export Food JSC, based in HCM City, said that many seafood exporters have had little orders from Europe due to low demand and the crisis. Therefore, processing factories have been operating moderately to supply the domestic market.

Nguyen Van Ky, general director of the An Giang Import Export Company, said that the price of tra fish had jumped to VND28,000-VND28,500 per kilo, forcing his company to cut spending to avoid losses.

Meanwhile, coffee has also faced declines in export price due to impacts associated to the economic situations in Europe and the US, according to the Viet Nam Coffee Association.

Pham Quang Dieu, chief economist at Agromonitor, a farming product analysis company, told the online business news website VnEconomy that the export volume of rice would gradually reduce by the end of this year because both exporters and importers had done careful business.

In the short term, Viet Nam would face difficulties in exporting rice due to high raw material and export prices, he said.

The current domestic purchase price of rice stood at VND7,000 per kilo compared to the previous VND4,000-5,000 while export prices have surged to US$570-580 per tonne.

Such prices have made importers consider importing rice at higher prices, Dieu said, due to the Indian Government permitting the sale of 2 million tonnes of rice without fixed floor export prices.

In the medium- and long-term, Vietnamese rice would gain advantages based on Thailand having to export rice at high prices and Indian halting rice exports to ensure food security at home, he said.

But the short-term challenges have as yet not hampered Viet Nam in hitting its export targets for farming and seafood products this year, the Ministry of Agriculture and Rural Development predicted.

The ministry expected the farming, forestry and seafood industry to increase to $23 billion in export value this year against $19 million last year.

IT conference flicks human resources switch

An upcoming conference will explore the demand and supply of information technology human resources in Vietnam and other countries.

The December 1 conference themed “ITC Human Resources in the Flat World” is being hosted by the Asia Oceania Regional Software Park Alliance (SPA), Quang Trung Software City (QTSC), Investment and Trade Promotion Centre (ITPC) and Ho Chi Minh City’s Department of Information and Communications.

SPA is an international collaboration between 22 members came from 13 economies in the Asia Oceania Region including Malaysia, Brunei, China, Hong Kong, Vietnam and Thailand among others.

The aim of this alliance is to promote the development of software parks and the IT industry.
Quang Trung Software City joined SPA in 2010 and QTSC has been President of the alliance since January 2011.

This is a significant step which proves that the information technology industry in Vietnam is strongly developed compared to other countries in the region.

Participants in the Conference will include senior government officials, representatives of international organizations, and software park management experts from countries in the region. The conference is expected to attract over 300 guests including the CEOs of multinational companies, and the CEOs of ICT companies in Vietnam, as well as the media.

Highway opening yet to stir up property market

Real estate transactions in areas east of the city such as districts 2 and 9 remain quiet even though the official opening to traffic of Thu Thiem Tunnel helps shorten the distance from developing outskirt areas to the city downtown.

Developed infrastructure, construction kickoff and complete connection are often used as excuses for property prices in districts 2 and 9 to move up in order to attract small individual investors. However, unlike the previous times, the market recorded a slight fall in both trading and offering prices of land lots and apartments in the outlying districts.

Lam Van Chuc, general director of Phuc Duc Real Estate Co., said the Thu Thiem Tunnel’s opening to traffic has little impact on land lot prices and trading volume in eastern HCMC, partly because of the gloomy picture of the market.

Similarly, the apartment segment also witnessed stagnant trade, especially after the owner of PetroVietnam Landmark project announced to offer a 35% discount in prices for the products in An Phu Ward, District 2 under the financial pressure.

The weekly market records of Vinaland Investment Corporation showed a slight drop in land lot and apartment offering prices of the projects in this area. Particularly, the offering prices of apartment projects have ebbed by 0.3-0.5% against the previous week.

For instance, the offering prices were VND19-22 million per square meter in Binh Minh condo project, VND24.5-25.5 million in An Phu-An Khanh project and VND19-21 million in An Hoa project. The price decline also occurred in high-grade apartment segment with Cantavil project being offered at VND31-37 million per square meter and Estella project VND31-33 million.

Likewise, land lot offering prices last week decreased by 0.3-0.7% over the week before that, as seen in several projects in An Phu-An Khanh, Binh Trung Dong and Thanh My Loi of District 2.

For example, the respective land lot prices of the projects Binh Trung Dong Cat Lai, Thu Thiem East and Thanh My Loi-Huy Hoang were VND16-17.5 million, VND22-24.5 million and VND34.5-40 million per square meter, a drop of 0.6%, 0.5% and 0.3% week-on-week respectively. The same happened to other projects like Thanh My Loi-Phu Nhuan, Van Minh and Century 21.

Chairman Tran Minh Hoang of Vinaland ascribed the price discount and trading decline to the unfavorable financial situation along with the troubled property market. In addition, customers are afraid of the complicated legality at the land lot projects in the area.

Hoang stated customers tend to buy property products with land use right certificates available and clear legality. This facilitates the buyers when they need to transfer the property to others.

According to a market survey by Savills Vietnam, the average secondary prices of villas and semi-detached houses in HCMC tended to decrease significantly since late 2010, with the prices recorded last quarter dropping by 16% over the same period last year.

The property service provider said the primary supply mostly comes from eastern city, or districts 2 and 9, while the secondary supply is distributed in the southern, including District 7 and Nha Be District. These two areas also offer a large supply of land lots.

Savills expected some 1,700 villas and semi-detached houses would be launched into the market in the short-term from now to 2012, and at least 3,000 would be added in the 2013-2014 period.
 
More negative developments in sight: brokers

Securities firms again suggested investors to be patient and wait for positive signs as the local market is expected to suffer more adverse developments this week after plunging below the bottom set last August.

Global market gyrations and lack of supporting news domestically saw both markets making new lows last week. The southern exchange, with four falling and one rising sessions, lost a hefty 16.68 points, or 4.21%, against the week earlier to close at 379.62.

Viet Capital Securities Co. said macro data will be out this week and it expects the CPI (consumer price index) to be “somewhat similar to what we saw in October, at around 0.3-0.4% month-on-month.” This will be a bright sign to help buoy up investor sentiment.

“As far as NPLs (non-performing loans) and M&A (merge & acquisition) activity in the banking sector are concerned, we will need to wait until Circular 34, which provides the guidelines on restructuring banks, to be effective as of December 1 to see any positive change,” it added.

HCMC Securities Corp said the announcement that domestic open-ended and ETFs (exchange traded fund) will be allowed from the end of this year should create a new category of domestic institutional funds and give a shot in the arm to local fund managers. The current draft proposal has been in the works for quite some time and is apparently awaiting final approval expected to happen in the coming weeks.

“The market has not reacted to the news however we view it as a positive although not a game changer initially at least. New funds or no new funds, the market is effectively driven by the price and supply of money. And only when interest rates fall and/or liquidity improves will the index rebound,” it said.

“More immediately the market continues to face steady selling pressure due to steady margin trade unwinding and banks’ recalling overdue loans before year-end. Both banks and more importantly brokers now face much tighter scrutiny and hence there is a lot less scope to carry losing positions on the books as happened before.

“Hence, any local company or individual carrying large amounts of debt is trying to cash in whatever they can then to meet either margins calls or repay maturing bank debt,” the broker added.

The Hanoi market dropped 1.42 points, or 2.23%, against the previous week to 62.18 with three falling and two rising sessions. The market’s daily trading volume averaged out at nearly 32.3 million shares worth nearly VND293 billion. The market is predicted to drop slightly this week.

ABBank reports loss in Q3

An Binh Commercial Bank (ABBank) has become the first bank reporting loss in the third quarter of this year, losing VND18.1 billion due to increasing credit risk provision.

An amount of VND240.6 billion has been set aside for risk provision, which is seven times higher than that of the same period last year. The bank still incurred the loss despite earning a gross profit amounting to VND262.5 billion, up 13.6% year-on-year.

Despite the third-quarter loss, ABBank still obtained VND252.5 billion in profit in the January-September period, 46% down year-on-year.

The bank will issue over 36.9 million bonus shares for shareholders with a rate of 9.8% at the end of this month, raising its chartered capital from VND3.83 trillion to VND4.2 trillion.
 
SBV speeds up gold market stabilization

The State Bank of Vietnam has set up a working group tasked with drawing up a program to stabilize the gold market utilizing local resources.

The central bank’s governor Nguyen Van Binh issued a decision last Thursday to set up the group, whose primary aim is to utilize local resources to stabilize the gold market. Nguyen Quang Huy, head of the Foreign Exchange Management Department under the central bank, is assigned as the group’s leader. Other members in the group are from departments and units under the central bank, as well as commercial banks and jewelry companies.

In October, the local gold price approached the global price, hovering around VND45 million a tael. However, the differential between the local and world market’s prices is still high, at some VND1 million per tael, meaning the local gold market has still been under control by speculators. One tael is equivalent to 1.2 troy ounces.

Earlier, the central bank had submitted to the Government a draft decree on gold trading management, proposing granting the right to manufacture gold bars for those firms making up above 25% of the market share for the past three years.

This means only Saigon Jewelry Holding Co., accounting for up to 90% of the market share is qualified to produce gold bars while eight other producers will have to relinquish their manufacturing activity. For instance, PNJ seizing a mere 9% share will have no choice but to withdraw from the gold bar production segment.

The draft has caused numerous controversies, with most ideas saying the central bank with the draft would only create monopoly on the gold market.
 
Savills to promote local property in Japan

Savills Vietnam would cooperate with Savills Japan to organize a seminar on investment opportunities in Vietnam’s property market at Tokyo American Club in Tokyo, Japan this Friday.

The guests of this event include Japanese investors or the firm’s clients currently residing and working in the country. At the seminar, Neil MacGregor, deputy managing director of Savills Vietnam, will have a presentation on specific property projects and products to potential investors.

Besides, the seminar will provide an overview of Vietnam’s macro-economy, the local property market, investment methods in Vietnam as well as opportunities and challenges for project investors and developers.

According to Savills, though local investors are experiencing multiple difficulties, foreign investors, especially those from Asia, still find many potential opportunities to invest in the Vietnamese property market.

In the past two years, several foreign investors took the initiative to purchase local property products, including office buildings, retail land sites, building complexes, houses, urban hotels and coastal resorts.

Moreover, the industrial property segment in Vietnam has become more attractive than before. Also, the fast development of the retail sector is creating new challenges for the local distribution system but in the mean time offering many chances for investors active in the field of logistics.

MacGregor of Savills said the property service provider is working with many Japanese clients with the hope to connect interested Japanese investors to the Vietnamese property market.

Savills Vietnam in 2010 successfully carried out several merger and acquisition transactions, including the acquisition of the Pacific Palace building in Hanoi with the value at US$90 million.