Shrimp farmers hope for clean start
 
Shrimp farmers in the coastal provinces of the Cuu Long (Mekong) Delta, who have been suffering unprecedented losses of shrimp, began cultivation after two months of little activity.

Farmers in the coastal province of Bac Lieu, the second hardest-hit locality after Soc Trang Province, decided to resume production in some areas after their ponds were carefully sterilised. Cultivation at other southern provinces also resumed.

An official from Bac Lieu Province's Department of Agriculture and Rural Development said the recent unprecedented death of many shrimp had occurred only with industrial farming. Household farms have not been seriously affected.

According to the department, as of July 7, about 1,495 of 6,072 ha of shrimp farms in the province, which had been severely affected by the epidemic, had resumed production. The province estimates that the total number of farms affected by the disease cover 16,720 ha.

Farmers in Soc Trang Province have also begun producing and selling breeding shrimp after careful sanitation tasks.

According to the Ministry of Agriculture and Rural Development, more than 19,000 out of nearly 26,000 ha of shrimp farms have resumed production, accounting for 76 per cent of shrimp farm in the province.

Shrimp prices remain high and nearby processing factories are facing a severe shortage of raw materials.

Since early this year, about 10 processing factories in Bac Lieu have collected only 647 tonnes of shrimp for production.

Ca Mau's 36 shrimp processing factories had been operating about 50 per cent of their capacity due to a serious raw material shortfall.

Industry insiders predict the shortage will remain for several months.

Shrimp farmers are employing more sanitary measures, experts said.

Foreign experts said they had not identified the cause of the massive number of dead shrimp in the delta.

However, Luong Ngoc Lan, head of Bac Lieu Province's Department of Agriculture and Rural Development, said that international experts concluded that contaminated farms had caused the deaths.

Farmers have not followed strict sanitation procedures and regulations because they wanted to quickly earn profits at a time when shrimp prices are high.

Unsanitary methods had left bacteria in ponds and had harmed developing shrimp, Lan said.

Many farmers, even those who experienced consecutive losses of batches of shrimp, continued to improperly use sanitary methods.

Farmers who performed proper sanitation earned big profits and their shrimp was not affected by the disease outbreak, he added.

Lan said his department had sent experts to epidemic hardest-hit areas to inform farmers the reason of the massive fatality and sanitation procedures before releasing breeding shrimps.

By early May, shrimp farmers in seven coastal provinces of the Cuu Long (Mekong) Delta had suffered unprecedented losses of tiger shrimp and white-leg shrimp on 52,000ha of farm area.

The losses on shrimp farms also occurred in the provinces in the northern and central regions, including Quang Ninh, Thai Binh, Nghe An, Ha Tinh, Thua Thien-Hue, Quang Nam, Quang Ngai, Binh Dinh, Ninh Thuan and HCM City.

The ministry estimates total losses in the 17 areas at over 53,000 ha. Farmers in the Cuu Long (Mekong) Delta suffered the worst losses.

Lan said farmers need cash allocation to quickly resume operating their farms.

Central Highlands invests in irrigation

Authorities in the Central Highlands province of Dak Nong have decided to invest VND3 trillion (US$143 million) on irrigation works in the province's ethnic region over the next 10 years.

The investment will come from the provincial budget and from a Government bond.

Around 100 new systems will be undertaken as part of the project, while 150 will be upgraded.

Once completed, the province's drainage system will ensure irrigation for 5,000ha of rice, 3,000ha of coffee trees and 4,000ha of aquaculture.

Over 200,000 people are expected to benefit from the work which will help improve living standards and promote agricultural production.

From 2006 to 2010, the province invested nearly VND1.2 trillion ($57 million) on 65 small and medium – scale irrigational works throughout the province for the development of local agricultural production.

Dairy report cites rising GDP for consumption boom
 
Milk consumption is rapidly growing in Viet Nam and will reach roughly 2 billion litres by 2013, a significant increase from 580 million litres in 2004, said Tetra Pak's Chief Representative in Viet Nam Bert Jan Post.

Post said while the rate of the average milk consumption per capita in Viet Nam remains modest by world standards, it is rising spectacularly. Currently, the rate of average milk consumption per capita in Viet Nam is 14.8 litres yearly, while the figure in Thailand is 23 litres.

The rate of milk consumption in Viet Nam is set to increase by about 15 per cent between now and 2013, Post said, adding that it will be an opportunity to create more jobs and income for farmers.

In the Dairy Index 2011 published this week by Tetra Pak, the world leader of food processing and packaging solutions, Viet Nam's vibrant growth in liquid dairy products (LDP) makes it a market spotlight this year.

The Index states that LDP demand per capita in Viet Nam increased by roughly 22 per cent yearly, due to the tripling of GDP per capita in the past decade and more than one fifth of its population living in cities.

Under the Index, Tetra Pak also said the rising tide of prosperity and urbanisation in Asia, Africa and Latin America will fuel growth of LDP demand. It forecasts global demand for LDP to rise around 30 per cent, from roughly 270 billion litres in 2010 to 350 billion litres in 2020. India and China will consume a third of the world's total LDP by 2020.

Notably, the Index said, packaged milk will overtake unpackaged milk in 2014.

"Milk consumption in developing countries is forecast to reach a tipping point in 2014, with around 55 per cent of white milk sold in packages," states the Index. The figure is expected to climb towards 70 per cent by 2020.

Tetra Pak Dairy Index is an annual report offering unique insights into today's dairy sector and the global trends shaping its future.

Exporters set sights on Philippines
 
Vietnamese firms are eagerly eyeing the Philippines, hoping to penetrate this lucrative market of 96 million people.

With its proximity to Viet Nam, the Philippines offers Vietnamese exporters plenty of opportunities but only recently have they begun to explore it.

Cau Tre Export Goods Processing Joint Stock Company is one company that typifies the trend.

Its general director, Tran Thi Hoa Binh, said she spent a lot of time in the Philippine capital Manila, visiting dozens of supermarkets, traditional markets, malls, and distribution channels.

"These visits helped me partly understand the tastes of Philippine consumers and identify the segment appropriate for the company's main products such as cha gio (spring roll), cha ca (fish paste), and cha tom (shrimp paste on sugarcane)," she told Tuoi Tre newspaper.

"We have for years exported our products to choosy markets like America, Japan, and Europe but still have little knowledge of this neighbouring market.

"So we do not know what kinds of products are to be exported," Binh said.

The Thanh Phuc Loc Company is also looking for partners in the Philippines to directly export its industrial salt products.

In the last two years it has exported hundreds of tonnes of products but only through contracts with a Singaporean partner, Nguyen Hong Phuc, its director, said.

"The demand for industrial salt in the Philippines is great but it is difficult for us to find clients there who want to directly buy our products."

The Hoang Anh Gia Lai Group (HAGL) expects to find Philippine investors in Vietnamese real estate projects.

Philippine investors had yet to invest in the Vietnamese property market unlike Singaporean and South Korean firms but Vietnamese firms had to introduce market segments appropriate for them, HAGL deputy general director Vo Truong Son said.

Viet Nam's commercial counsellor in the Philippines Phan Tuan Khoi said the Philippines' 96 million people have great demand for various kinds of goods.

Though it would take just four or five days for Vietnamese businesses to ship their goods to Philippine ports, they did not export to that country since they had not yet found potential distributors there, he said.

He stressed the need for Vietnamese entrepreneurs to visit the Philippines and carefully study the market and contact the right distribution channels and potential partners.

Viet Nam's Trade Office in the Philippines was ready to support Vietnamese businesses coming to that country looking for opportunities, he promised.

Cashew, instant coffee, tea, pepper, plastic goods, garment and textile products, machinery, electrical cables, and electrical and electronic equipment could become popular in the Philippines, he said.

Trade between Viet Nam and the Philippines has risen six-fold in the last decade to US$2.4 billion.

The latter is now Viet Nam's biggest rice importer and has many companies successfully doing business here, such as Jollibee, United Pharma, and Oishi.

Gov’t to reimburse Petrolimex for fuel trading loss

The Government will cover an estimated loss of VND1.22 trillion incurred by Vietnam National Petroleum Corporation, or Petrolimex, as compensation for its joining the country’s price stabilization program, the company’s top executive said yesterday.  

Bui Ngoc Bao, chairman and CEO of the company, told investors in a road show on its initial public offering (IPO) in HCMC on Thursday that it estimated the loss of VND1.22 trillion equivalent to nearly US$60 million for the period from January through September prior to its IPO. He did not elaborate on the total loss in the year to date, however.

The Ministry of Finance on June 20 issued a document assuring the company that the Government would create conditions for the company to clean up its balance sheet, Bao said, adding the arrears must be settled when the company becomes a shareholder-owned company after the IPO.

Petrolimex will sell 5.01%, or 52.6 million shares, including 2.45% to be offered to employees of the corporation and 2.56% to be sold to the public. The State will hold 94.99% of the company’s registered capital. The auction of 27.43 million shares will be held at the Hanoi Stock Exchange on July 28 with the initial auction price set at VND15,000 per share.

The company’s chartered capital before equitization is over VND1.43 trillion and its equity after evaluation on January 1 last year was about VND6.16 trillion. Petrolimex’s chartered capital after the initial public offering will be VND10.7 trillion.

Bao told the meeting that if the petrol market is managed under market principles as asserted by the Government, Petrolimex’s profit will be stable in the coming time. The company expects its pre-tax profit will be VND648.5 billion in the fourth quarter this year and VND2.68 trillion in 2012.

In 2010, the after-tax profit of Petrolimex in petrol trading was VND81.15 billion, but thanks to other operations like gas trading, banking, and insurance, the corporation’s consolidated after-tax profit rose to VND535 billion.

Petrolimex now dominates the local petrol market, and imports 55% of the country’s total. Its fuel market share in the country is 54%-55%.

The corporation also exports products to China, Laos, and Cambodia, and holds a 60% market share in the last-named market. Petrolimex now has 2,100 fuel retail stations and 4,000 agencies nationwide.

The auction is not open to foreign investors, who can only participate in the company via strategic deals. Bao, however, affirmed at the meeting that at this time, the corporation had no intention to find a strategic foreign investor.

Petrolimex now has 42 subsidiaries nationwide and Bao said it did not intend to privatize any subsidiary to avoid a possible conflict of interest later.

Between now and 2015, Petrolimex expects to invest in the Nam Van Phong Oil Refinery Project in Khanh Hoa Province with a designed capacity of 10 million tons of crude per year. The total investment capital is about US$4.4-4.8 billion.

Rubber exports to hit $3b

Rubber exports are expected to total about 830,000 in 2011, earning over US$3 billion, with annual output projected to increase by 4 per cent, according to the Viet Nam Rubber Association (VRA).

Nguyen Viet Chien, director of the Centre for Information and Statistics under the Ministry of Agriculture and Rural Development, said rubber exports in June were estimated at 40,000 tonnes, worth $160 million. This brought the total for the first half of the year to 274,000 tonnes at a value of $1.2 billion, up 80.3 per cent in value over the same period last year.

Economists predicted that rubber prices in the last six month would not drop below US$4,000 per tonne, with major producers such as Thailand, Indonesia, and Malaysia looking to protect their rubber prices to avoid losses.

Global demand for natural rubber increased by 3.8-4 per cent this year.

Tran Thuy Hoa, General Secretary of the VRA said global rubber production would continue to increase, although levels would not meet the demand and the price would remain high. This increased demand would come mainly from China, accounting for 59.5 per cent of the country's total rubber exports.

The average price of rubber for export in the first six months hit $4,410 per tonne, 60 per cent higher than last year.

Viet Nam has the fifth largest area of rubber plantations in the world, and ranks fourth in terms of exports.

Ministry expected to slice pork prices

New pork prices are set to be introduced during the next five months of this year, according to a senior official of the Ministry of Agriculture and Rural Development.

Hoang Kim Giao, director of the Animal Husbandry Department, confirmed on Wednesday that starting from the end of August, pork prices would slip by 10-15 per cent due to farmers having inefficient time to expand their pig herds.

In order to reach such a goal, Giao said that the ministry would establish a price stabilisation fund to support companies and farmers both financially and technologically.

While working with banks on special farmer interest rates, the ministry also plans to reimburse farmers with 70 per cent of their advertisement costs and exempt them from land-use fees.

In addition, farmers will be encouraged to raise additional types of livestock such as rabbits, goats and sheep.

During June, pork prices increased by up to 70 per cent due to high demand and low supply, caused by disease decreasing sow numbers by 8.6 per cent, the ministry said.

High interest rates and income costs additionally inhibited production, around 10-30 per cent of households ceasing to raise pigs.

In other developments, Ha Noi People's Committees called on sectors to boost activities in controlling prices while reducing speculation against the rise of food and foodstuff prices since the beginning of the month.

The committee called on the Industry and Trade as well as the Agriculture and Rural Development departments to assist individuals and companies in increasing production.

Those found in violation of price and speculation regulations will be strongly punished.

Capital city apartment market goes into recession

The market of apartments for sale in Ha Noi in the second quarter has bleak outlook due to macro-economic policies on capital, said property experts.

The average secondary asking price of the whole market decreased 1 per cent against the previous quarter, according to the Savills Viet Nam Ltd Company's quarterly report.

The asking price in Cau Giay and Thanh Xuan were unchanged from last quarter. The average prices of districts Hai Ba Trung, Hoang Mai, Gia Lam and Long Bien saw increases of 3-4 per cent while the remaining districts had decreases from 2-8 per cent.

The CB Richard Ellis Viet Nam Ltd Company said the market sentiment was relatively low, forcing developers to take measures to boost sales. Certain developers with a large stock in the pipeline offered incentives to not only potential buyers but also current buyers. These included price discounts and removal of CPI pegging.

Phan Thanh Mai, director of network for real estate trading floors, said real estate businesses also face many difficulties with high interest rates higher than their benefits; many investors are forced to stop the project.

Regarding to the market angle, the segment of apartment for sale in Ha Noi has become saturated, Mai said, adding that places with better locations and higher prices do not meet customer demands for price, while places further away do not meet customer demand for location. Therefore, the businesses must regulate their activities to be viable.

Do Thu Hang, chief of Savills Viet Nam's research and consultancy division, said the apartment market was under the pressure of credit tightening policy. For businesses, high interest rates on loans forced them to stop developing property, affecting the future supply of apartments.

HSBC named best foreign bank

HSBC Viet Nam has been named the Best Foreign Commercial Bank in Viet Nam by FinanceAsia, one of Asia's leading banking and finance publications.

The bank has won the award for six consecutive years.

Over the previous year, the bank expanded its product offerings to small – and medium-sized enterprises (SME) and individuals and increased the number of credit cards in force by 99 per cent.

City to host software testing confab

HCM City will host the second Viet Nam International Software Testing and Automation Conference (VistaCon) in December, seeking to enhance Vietnamese engineers' practical knowledge of software testing.

Four key topics at the VistaCon 2011 will be automatic testing, other testing methodologies beside Agile, testing for agile software, software processing and trade in IT services in a multi-cultural context.

Software testing firm LogiGear Viet Nam is the organiser of VistaCon 2011.

Hospitality professionals to gather

A hospitality management conference will be held in HCM City in September to develop an overview of the Vietnamese market, assess the current situation and explore opportunities for further development.

Irving Seminar & Training, a Thailand-based company said it would help hotel owners, investors and operators learn about the latest trends and best practices in hospitality management.

It would also have experts and experienced business leaders from across the hospitality industry in many countries analyse problems and offer advice on overcoming them.

PM okays computerised lottery

Prime Minister Nguyen Tan Dung approved the establishment of Viet Nam Computerised Lottery Company.

This will be a State-owned limited liability company with a charter capital of VND500 billion (US$24.3 million), in which the State contributes VND300 billion ($14.3 million) and the rest from the Investment and Development Fund.

The company aims to operate nation-wide and its proceeds will go to medical facilities, education, and social welfare for localities that host its services.

Song Da 7, BIDV join hands

Song Da Urban and Industrial Zone Development and Investment Joint Stock Company (SUDICO) has just established a partnership agreement with the Thanh Xuan Branch of BIDV for credit supply and banking services to 2015.

Under the agreement, the two sides commit to long-term co-operation through mutual supports in suitable operating and trading fields.

SUDICO is under the Song Da Corporation. The company does business in real estate, mineral exploitation, housing construction and transportation.

BNP Paribas ups stake in local bank

Orient Commercial Joint Stock Bank (OCB) has signed an agreement to issue an additional 27 million shares to BNP Paribas (France) on Monday, following the approval of the Prime Minister.

This transaction raises the capital contribution of BNP to 20 per cent (US$143 million equivalent) of OCB's charter capital.

BNP became a strategic alliance shareholder of OCB from 2007.

The two sides implemented programmes on risk control, technology modernisation and will foster future co-operation on trade finance, and import and export sectors.

Province gets first international school

KinderWorld Education Group yesterday opened Singapore International School in Dai An Residential Area in Vung Tau City.

The school was built on an area of 8,051 squ.m with 40 classrooms and other rooms that support learning.

This is the first international model in Ba Ria-Vung Tau Province that has similar standards to overseas curricula.

Vincom's overseas bond issue raises $40m

Real estate developer Vincom (VIC) has raised US$40 million from sales of international bond. Singapore-based Credit Suisse AG arranged the sale of the bonds, which carry an 11-month term and pay a yield of 6 per cent.

The sale marks the second time Vincom has successfully raised capital on the international market. It listed $100 million worth of convertible bonds in Singapore in 2009.

Three firms to list on HCM City Exchange

Hoi An Tourist Service Co and Tien Giang Construction and Investment Co plan to list shares on the HCM City Stock Exchange later this month. Hoi An shares will list at a reference price of VND17,600, while those of Tien Giang Construction will list at a price of VND25,000 per share.

BIDV Securities Co will also list shares representing its entire charter capital of VND865 billion (US$42 million) on the southern bourse next Tuesday, coded BSI, at a reference price of VND10,300 per share. The company last year earned VND423 billion ($20.5 million) and posted a net profit of VND11.4 billion ($553,400).

Newly-listed real estate firm falls short of target

Real estate agent Century 21 (C21), which began trading on the HCM City Stock Exchange yesterday at a price of VND35,000 (US$1.70) per share, announced earnings of VND82 billion ($4 million) in the first six months of this year and posted a net profit of VND36 billion ($1.7 million) for the period, equal to 41.4 per cent of the target for the entire year. The company expects to pay a 16-per-cent dividend on 2011 profits.

‘Geological heritage’ photo show in Hanoi

An award ceremony and exhibition of the best entries of photo contest ‘Dialogue with geological heritage’ will take place on Sunday at Pham Ngu Lao guest house, 33 Pham Ngu Lao, Hanoi.

The exhibition will run until Wednesday and will showcase 77 photos selected from 2,219 works by 179 authors in the national photo contest, sponsored by the Vietnam Association of Photographic Artists, which ran from May 1 to June 10.

The first prize will be awarded to the work ‘Vietnamese Stones – Seas’ by Hoang Trung Thuy, second prizes will be given to ‘Lithophone’ by Vo Ngoc Lan and ‘Ly Son fairy island’ by Nguyen Xuan Vinh. Third prizes will go to ‘Son Tra cave’ by Truong Minh Dien, ‘A new day on top of Fansipan’ by Bui Quoc Ky and ‘Dragon down’ by Do Khanh Giang. Consolation prizes will also be awarded to 10 other works.

Something Borrowed comes to town  

U.S. romantic comedy Something Borrowed, based on Emily Giffin’s book, starring Ginnifer Goodwin, Kate Hudson, Colin Egglesfield and John Krasinski comes to the city from Friday.

Rachel (Goodwin) is a nice girl with a good heart who falls in love at law school with fellow student Dex (Egglesfield) who comes from an affluent family.

When Dex meets her best friend Darcy (Hudson), who treats Rachel like dirt, she makes a move on him and gets him. Eventually they get engaged and Darcy asks Rachel to be her Maid of Honor.

When Darcy throws a birthday party for Rachel she gets drunk and spends the night with Dex. They try to forget the whole thing and although they agree it meant nothing, the truth is it meant everything. Ethan, Rachel’s close friend tells her that she may spend her entire life regretting losing out on her one chance at true love.

As the wedding approaches, Rachel and Dex realize they are meant for each other. Will they chose true love or will Rachel choose her friendship with Darcy?

The film, directed by Luke Greenfield, debuts on Friday at Galaxy, MegaStar, Thang Long, Lotte, BHD Star and Cinebox cinemas.

Cane growers get some sweet news

Sugar production soared by 29 per cent to 1.15 million tonnes this sugarcane season, the Department of Agriculture, Forestry and Fishery Products Processing and Salt Industry said.

Its deputy director, Doan Xuan Hoa, told a review meeting held in HCM City last Friday that the country had 271,400ha under sugarcane now, an increase of 6,300ha since the last crop.

Output in the 2010-11 crop topped 16.4 million tonnes, an almost 20 per cent rise, thanks to an average yield of 60.5 tonnes per ha.

The yield and quality had both improved.

Sugarcane prices in the Cuu Long (Mekong) Delta region and central Khanh Hoa and Ninh Thuan Provinces had risen by VND250,000-400,000 per tonne since last year to VND1.05-1.2 million and VND1.1-1.14 million.

The higher prices had encouraged farmers to expand sugarcane cultivation.

The strong growth in the domestic food processing and soft drink industries which used large volumes of sugar had led to an increase in demand to around 98,000 tonnes a month compared to 94,000 tonnes last year.

Sugar imports this year had been 93,000 tonnes, almost a third down from last year.

Nguyen Van Hoa, deputy head of the Cultivation Department, said a Government plan for the sector's development through 2020 had set targets for area under sugarcane, average yield, and sugarcane and sugar output.

But most of the targets, except processing capacity, had been missed.

The country's 39 sugar mills had a total capacity of 112.2 million tonnes, 6.8 per cent higher than the target.

He blamed this on the small scale of farming and poor infrastructure, which prevented farmers from mechanising and adopting intensive farming techniques.

There had been some unfavourable weather that had adversely impacted sugarcane output.

Moreover, some localities had not focused on zoning plans for sugarcane cultivation.

He urged provinces to make plans for sugarcane development and sugar mills to invest in developing their own cropping zones.

New cultivation techniques should be adopted to increase productivity.

Nguyen Thanh Long, chairman of the Viet Nam Sugar and Sugarcane Association, suggested establishing close links between farmers and sugar mills as well as between the mills themselves to develop the industry in a sustainable manner.

State business share sales to see breakthrough

The number of state-owned enterprises (SOE) to change ownership status was expected to surge after a long period of standstill if the government cleared a decree on SOE equitisation, said an official.

Nguyen Duy Long from the Department of Enterprise Finance under the Ministry of Finance, said the draft decree that the ministry had recently submitted to the government, allowed target enterprises to sell shares to strategic investors, both domestic and international, before auctions were made public.

The current regulation allowed only post-auction sales in regards to shares of enterprises totally owned by the state during the process of turning themselves into joint-stock companies.

The rigidity and inflexibility in the regulation had made it almost impossible for SOEs, including giants such as the Bank for Foreign Trade of Vietnam (VCB) and the Saigon Beer, Alcohol and Beverage Corporation (SABECO), to lure strategic investors, who are rich in both capital and managerial experience.

It also meant that SOEs-turned joint stock companies were unable to tap leading investors’ managerial experience for post-ownership change operations.

The draft decree, recommended permission for SOEs to proceed with the ownership change process even if shares in the initial public offerings were not sold out. Some articles relating to evaluation of property costs, trademark value and employee incomes were also revised.

Long added that the decree’s contents which related to measures for sales of SOE shares had virtually been approved by cabinet members after thorough discussion.

The Ministry of Planning and Investment said the number of SOEs in Vietnam had been sharply reduced in the past two decades, from over 12,000 entities in early 1990s to just over 1,200 in late 2010, as the result of the SOE restructuring and modernisation programme.

Joint-stock companies were the major choice among target SOEs, making up over 55 per cent during the 2001-10 period.

Under government guidelines, the state would hold the entire or major stakes of only a small number of enterprises which operated in the fields of national security, transport, media, energy and forestry.

Rubbing salt into the wound

There is not yet suitable answer for the lack of industrial salt delaying chemical projects in Vietnam.

This is despite the fact that chemical manufacturing firms are crying out for industrial salt and asking for imports.

Le Van Hung, director of Southern Basic Chemical Company, said his company needed 80,0000 industrial salt tonnes for its produce.

Hung added that because of the shortage, his company delayed many projects such as the project to raise its capacity to meet Lam Dongaluminum-bauxitecomplex project.

In June this year, the Ministry of Industry and Trade was not supported by the Ministry of Agriculture and Rural Development (MARD) for the plan to import 50,000 tonnes of industrial salt.

Last year, the two ministries as well local chemical firms and salt firms sat together to discuss domestic salt demand for 2011. At that meeting, domestic salt firms said they could only supply 70,000-75,000 industrial salt in maximum in 2011, far from the estimated domestic demand of more than 260,000 tonnes.

Based on this forecast, the MoIT agreed to grant import quota of around 102,000 tonnes of industrial salt across this year.

Dao Trung Tuyen, general director of Viet Tri Chemical Joint Stock Company - one of the largest chemical firms in Vietnam, said: “We really want to buy industrial salt in the domestic market, the problem is that there is no availability of the material for us.”

The MoIT’s Chemical Department said in a meeting between MoIT and MARD on July 13 that it wanted to know about the actual supply of domestic salt producers before making decision on additional industrial salt import quota. But, no salt firm took part in this meeting.

Under Vietnam’s World Trade Organization commitments, the country is able to maintain an import quota system for several agricultural products including salt, sugar and eggs.

Vietnam has for many years imported industrial salt as local suppliers cannot satisfy both quantity and quality. In 2008, the country for the first time imported edible salt for households.

According to MARD, until 2015 local salt farms can satisfy the domestic demand for both industrial and edible salt.

Retailers need to box clever to richly prosper

Vietnam’s retail market competition is set to heat up as foreign-backed and local distributors fight for greater market share amid slowing growth in the sector.

According to the General Statistics Office, revenue from retail sales in the first half of the year was estimated to reach VND912 trillion ($44.3 billion), up 22.6 per cent against the same period last year.

However, Vietnam Retailers Association general secretary Dinh Thi My Loan said the real growth rate of the market was only 7 per cent because of the slide in prices.

“This is a very low growth rate as compared to the 15-20 per cent range in previous years,” Loan said.

“Both foreign and domestic distributors in Vietnam are under pressure to increase market share,” she noted.

Big C, managed by the Casino Group, has unveiled a 50 per cent discount on 4,000 products until August to thank its customers and mark its 13th birthday.

The firm now has a presence in nine cities and provinces across Vietnam.

Meanwhile, Metro Cash & Carry, which entered in Vietnam in 2002 and now has 13 stores in 11 cities and provinces across the country, also ran a promotional campaign with awards of nearly $300,000.

Vu Thi Hau, deputy general director of local-owned supermarket chain Fivimart, said: “The domestic retail market is facing tough competition from foreign retailers, then there is rising inflation and falling consumer confidence. We are trying to hold onto market share and make a profit.”

She added competition was unavoidable and benefited customers. “We accept reducing part of our profits to ensure the good prices for customers and increase our competitive edge,” Hau said.

Fivimart offers promotion each month to attract clients such as their golden day in May strategy.

Alongside promotions, both foreign and local retailers are plumping for own brands. These are especially popular given current high inflation because store brands offer the same quality but carry price tags some 15-30 per cent lower.

Metro Cash & Carry Vietnam, with six brands, is considered an own brand pioneer while Co-Op Mart chain has also marketed its own brand products in collaboration with 45 producers such as Kinh Do, Lix detergent, Saigon Paper and Dong Nai foodstuff processing factory.

The current slowdown has failed to put the brakes on Vietnam’s retail sector with foreign-invested firms not put off by a slide in the country’s global retail development index. South Korea’s retail giant E-mart and Japan’s AEON Co.Ltd plan to jump into the market while existing foreign-invested Family Mart is looking to upsize from its current six stores to a massive 100 stores in 2011.

Sluggish projects in HCMC to be restarted

Ho Chi Minh City Infrastructure Investment Co. (CII) will restart the Binh Trieu 2 Bridge and a road project which have been stagnant for 10 years.

The project includes the expansion of Binh Trieu 1 Bridge, and National Highway 13 running through Binh Thanh to Thu Duc districts. The construction of Binh Trieu 2 Bridge along with some other works were aimed at easing the overload on Xo Viet Nghe Tinh-Binh Trieu Bridge-National Highway 13 route, one of the city’s two most-used gateways.

The project, with an initial investment of VND341.9 billion ($16.6 million), was first given to Civil Engineering Construction Company No.585 (Cienco 5). It first broke ground in 2000. Construction was scheduled for completion in two years.

However, in 2003, the city asked for a further expansion of National Highway 13, changing the planned width from 32m to 53m. This raised the project’s total cost to VND1.6 trillion ($77.6 million), exceeding Cienco 5’s funding capacity.

In 2004, after Binh Trieu 2 Bridge was completed, Cienco 5 handed over the second phase of the project to the city, who gave the project to CII in 2005.

But, until two years later, CII made a proposition to the municipal authorities that they increase funds for the project to a total of VND3.49 trillion ($169.4 million), ten times higher than initial estimates.

The city authorities continued their debate on the plans and its environmental and social impacts. As a result the expansion of Binh Trieu 1 Bridge was on hold until 2009.

The 10-year stagnation of the project has left a gap in the city's transportation system, as the Xo Viet Nghe Tinh-Binh Trieu Bridge-National Highway 13 route would be one of the key land routes into the city.

CII still plans to expand National Highway 13 in the next two years, yet there are worries about the initial phase of site clearance.

PVI looks for a new path
 
PetroVietnam Insurance is delaying its shares issuance to Oman Investment Fund to focus on a deal with a new strategic partner in the international insurance industry.

The deal with Oman Investment Fund (OIF) was planned to finish one month and half ago on May 30.

OIF, which owns a 12.6 per cent stake worth some VND202 billion ($9.75 million) in PetroVietnam Insurance (PVI), is in negotiation to purchase some 8 per cent additional stake of the non-life insurance giant.

The company said it would sell at a price not lower than the book value of VND22,000 per share, much higher the current market price of some VND14,000-VND16,000.

Actually, the issuing shares are in the insurer’s raising fund plan for 2011, in which it will increase its chartered capital by some VND200 billion ($9.66 million) from current VND1.6 trillion ($77.29 million) to VND1.8 trillion ($86.96 million).

“The work with Oman had to be postponed,” said PVI chairman Nguyen Anh Tuan, expecting the final result will be announced next month. “Oman [OIF] is our financial partner and board of directors decided to give priority to the strategic partner in insurance sector.”

The strategic partner in insurance sector, according to PVI, is its essential step at the moment for its model transform to finance-insurance group that kicked-off since middle this year.

PVI’s remodel comes amid a recent trend among domestic insurers to shift businesses models to new levels.

Former Military Insurance Co. announced in July to merge into Military Insurance with 19 units directly under the parent company, accompanied with some arms specialising in financial sector.

SHB-Vinacomin (SVIC) is also transferring to parent-subsidiary model, after the same restructure of BIDV Insurance in 2010.

PVI’s second strategic partner is believed to give strong support to the non-life insurance firm in establishing a re-insurance firm lately this year, followed by a life-insurance arm in 2012. PVI’s leaders, however, did not give details on the deal.

In transforming its plan, PVI also planned to sharply raise fund to VND3.6 trillion ($173.9 million) within next year via private placement to strategic partners and allocating shares to existing shareholders.

The company said its before-tax profit for the first half of this year rose 13 per cent to VND220 billion ($10.62 million), making up some 52.3 per cent this year’s target. That profit was made by revenues advancing 18.6 per cent to VND3 trillion ($144.9 million), accounted to 61.8 per cent 2001’s plan.

PVI’s general director Bui Van Thuan estimated the home insurance market would grow some 10 per cent to 15 per cent this year, compared with average growth of 25 per cent in previous years.

“Domestic insurers will meet with difficulties until this year’s end,” said Thuan.