Pilot cooperatives programme to continue

Japan and Vietnam will continue to link up to implement the Project for Enhancing Functions of Agricultural Cooperatives in Vietnam – phase 2.

The project document was inked on October 25 in Hanoi by representatives of Japan International Cooperation Agency (JICA) and Department of Cooperatives and Rural Development under Ministry of Agriculture and Rural Development.

The first phase of the project kicked off in March 2006 aiming to assist Vietnam’s government to develop new cooperative models in accordance with the 1996 Cooperative Law.

The government is promoting the transformation of traditional style cooperatives which focus mainly on agriculture production. It wants to establish new cooperatives whose activities includes marketing, product processing, joint purchasing of production materials and credit.

Despite the high demand from cooperative members, however, little progress has been made because cooperative officers lack experience.

According to Tsuno Motonori, chief representative of JICA Vietnam, the single function cooperative model was once popular in Japan. As of 1961, however, the Japanese government encouraged small-scale agricultural cooperatives to merge and then form multi-functional cooperatives.

“The multi-function agricultural cooperatives take responsibility for all service areas such as provision of farming tools, credit, helping farmer to process and consume products and covering insurance for farmers’ activities. I think these types of experiences are a good fit with the current development of Vietnam agriculture,” said Motonori.

The first phase of the project which ended in September last year was a real success in enhancing functions of agricultural cooperatives in Thai Binh and Hoa Binh provinces, according to vice minister of Agriculture and Rural Development Ho Xuan Hung.

“The project experiences have been documented as guidebook to be applied on national scale; this includes a guideline for formulating mid-term planning in agricultural cooperatives, and a guideline for organising regular meeting of cooperative members. With a desire to bring into full play the achievements of phase 1 of the project and expand the project nationwide, the Ministry of Agriculture and Rural Development has proposed the carrying out the second phase and JICA has agreed to continue its support,” Hung said.

By popularising the lessons and achievements of the first phase (2006–2010) to other regions and cooperatives, the second phase will focus on building the support system for enhancing functions of cooperatives and building human resource training systems at central and local levels.

The project will run from 2011 to 2014 in northern, central and southern provinces including Hoa Binh, Thai Binh, Hai Duong, An Giang and Binh Dinh.

Halong property feels the heat

With improving infrastructure and a marvellous natural setting northern Halong city is fast becoming a property investor hotspot.

Since 2000, Ha Long city in Quang Ninh province has seen over 130 property projects get off the ground. And now the city’s buzzing property market is luring investors from Hanoi and Ho Chi Minh City, according to PetroVietnam Premier Recreation Joint Stock Company (PVR) general director Nguyen Tuan Anh.

PVR is the developer of a high-end hotel, office and trade centre development in Ha Long city.

Deputy chairman Doan Quoc Huy at BIM Group, the developer of Hung Thanh urban centre project in the city, said a number of factors had helped make the city’s property market vibrant. These included expansion of key roads and the construction of cable-stayed Bai Chay bridge in late 2006.

Huy said the projects had given life to the city’s east and west with high-end residence, office, hotel and trade centre complexes in the pipeline.

Property market insiders in Ha Long said though Hanoi, Ho Chi Minh City and Danang had their risks, Quang Ninh province was a relatively sure bet with constant rises in prices and transaction numbers every year.

Besides, Quang Ninh province is home to Ha Long Bay, a world natural heritage site which could become one of the world’s seven new wonders. This makes it a stunning venue for tourism property developers.

Market surveys in late 2006 reportedly paved the way for the Bayview Towers project idea. The Minh Viet Investment Corporation project is located in Ha Long city’s Hong Ha ward and has total investment capital of VND1.6 trillion ($77.3 million). It takes inspiration from Trong Mai islet on the south-west side of Ha Long Bay.

In addition to Bayview Tower, Ha Long Bay’s charm has made it a destination of choice for a sequence of property developments including Licogi’s 19-storey apartment tower, the Metro Ha Long mega supermarket, PVR’s high-end hotel, office building and trade centre complex and Song Da Urban and Infrastructure Zone Investment and Development Joint Stock Company (Sudico)’s Song Da-Ngoc Vung urban centre.

Motor Show takes pole position

The Vietnam Motor Show 2011 will go into overdrive from November 16–20 in Ho Chi Minh City.

The seventh Vietnam Motor Show organised by Vietnam Automobile Manufacturers’ Association (VAMA) in coordination with Asia Trade Fair and Business Promotion ATFA will welcome the participation of six local automakers.

They are Toyota, Vietnam, Honda Vietnam, Mercedes Benz Vietnam, GM Vietnam, Suzuki Vietnam, and Samco.

Vietnam Motor Show 2011 includes centralised display areas to give customers the change to see the latest technology the auto industry has to offer, including the newest car models.

The show will also pump some much needed gas into a local automobile market which has been off the boil since beginning of the year.

The 12,000-square metre Motor Show 2011 will include more than 60 new car models and concepts and draw the participation of more than 100 national and international enterprises from various sectors including accessories, spare parts, interior decoration and banking and insurance among others.

The show is expected to attract 120,000 visitors over its five days.

Local food exporters told to attend to parboiled rice

Vietnam should speed up parboiled rice export to the world market, suggested many experts in an international seminar held in HCMC last week.

There were not many people eating parboiled rice due to its prices being higher than the ordinary 5%-broken white rice by US$70-80 one ton, but the situation has changed recently, pointed out Subramanian, an Indian rice expert.

The need for parboiled rice has risen as its nutritious value exceeds that of white rice by 10%-20% and the latter have up to a 30% loss compared to a mere 10% of the former when being processed.

There is only one parboiled rice processing mill in the country, but investors have plans to set up one more in 2012 and three more factories in the near future to provide products for oversea buyers.

Vietnam will raise the total volume of exported parboiled rice by 300,000 to 400,000 tons from 2011, reported Vietnam Food Association (VFA). Since the country’s parboiled rice’s quality is appraised among Asian nations, the association has worked with the Ministry of Agriculture and Rural Development to ensure input material supply for export demand.

Parboiled rice is made by boiling unhusked paddy first before drying and milling.
 
Vinatex to buy stake of textile firm in Khanh Hoa

Vietnam National Garment and Textile Group (Vinatex), after buying two loss-making garment firms, is planning to acquire shares  in a textile firm in the coastal province of Khanh Hoa.

Deputy general director Le Trung Hai told the Daily on Monday that the group was preparing to buy about 60-70% stake in an apparel firm in Khanh Hoa Province and expected to conclude the deal next month. However, Hai did not reveal information of the firm.

Vinatex may consider supporting or buying any firms making losses, Hai added.

Hung Yen Garment Joint Stock Co., a member of Vinatex, spent US$1 million taking over South Korea-invested Garment Gunyong Co. located in the northern province of Hung Yen last month and plans to spend VND40 billion expanding the factory of this South Korean firm.

Vinatex in July took over Dai Cat Tuong Garment Co., a loss-making firm in the central province of Quang Ngai, at a price of VND39.876 billion at auction.

In related news, the group will complete the process of evaluating its assets in preparation for its equitization next year.

Vinatex is currently having 120 members and affiliates. Export turnover of its members accounts for 20% the total turnover of the country’s garment sector.

Mekong delta farmers rush to panic harvest sugarcane  

The mood is of utter despair amongst many sugarcane farmers in the Mekong delta province of Hau Giang as hundreds of hectares of sugarcane crop lies ravaged by floods while traders show no interest.

Farmer Ba Banh from Phuong Binh Commune of Phung Hiep District in Hau Giang Province is an unhappy man as traders are not coming forth to buy sugarcane even though it is priced at a low VND800 per kilogram.

This despair is shared by thousands of farmers living in Phuong Binh, Hoa An and Hoa My communes. They are all willing to sell off the immature sugarcane crop at VND1,000 per kilogram, much before the  harvest season.

Phung Hiep District in the Mekong Delta is the largest sugarcane farming area, with nearly 9,000 hectares under sugarcane cultivation.

“However, nearly 700 hectares of the sugarcane crop has been inundated and the plants are slowly beginning to rot while sugar companies are not yet buying. The government should now provide timely support or else farmers stand to lose a lot”, said Nguyen The Tu, chief of the Department of Agriculture and Rural Development in Phung Hiep District.

Nguyen Van Chinh, director of Long My Phat Sugar Company, explained their tardiness in purchasing sugarcane, saying that the plant capacity is only 2,000 tons per day, processing around 30,000 tons in 15 days.

However it is being asked to process approximately 50,000 tons per day. The plant is trying to increase its capacity to 3,000 tons per day in order to meet the demand, said the director of the sugar company Long My Phat. He also called for help from other plants to process sugarcane in flood hit areas.

Nguyen Thanh Long, chairman of Vietnam Sugarcane and Sugar Association, said the sugar factories in flood hit areas should give exact figures to relevant agencies before November 5. Sugar companies in Hau Giang, Soc Trang, Tra Vinh and Ben Tre provinces in the Mekong delta should give top priority to buying sugarcane from flooded areas.

Sugar companies have offered VND1,000 per kilogram to collect the plants from the farms itself. But it is doubtful that sugar companies can purchase the crop at the same price, because cost of transport has increased. The government needs to step in to resolve this issue to save the farmers from further losses.

Tu expressed the effectiveness of an enclosed embankment area for sugarcane cultivation and for sugar companies to bear responsibility of supporting farmers by helping the drainage of water in flooded areas. With a strong fortified dyke in Phuong Hiep District, farmers can grow sugarcane in any season and feel no need to harvest under pressure.

Knight Frank, CBRE picked as sales reps for northern project

Vinaconex-ITC Joint Stock Co has appointed Knight Frank and CBRE as the sales representatives for Fantasia high-class resort villas in northern coastal Hai Phong City.

On this occasion, the three parties also officially introduced the sales program of Fantasia high-class villas for customers with average price ranging from VND4 billion to VND11 billion for each villa.

As a part of the second phase of Cat Ba Amatina Complex with international standards, the project, located in Cat Hai District’s Cat Ba Town, will include 63 plots of land with areas ranging from 360 to 936 square meters, of which 25 percent of the total areas will be set aside for construction.

The villas were expected to be handed over to customers by the end of 2012.

Reeling steel industry can recover: expert

Though it is going through a crisis with poor consumption and high unsold inventory, the steel industry can recover with some assistance, said Pham Chi Cuong, Chairman of the Vietnam Steel Association.

In an interview with VietnamPlus Newswire, Cuong said the crisis would eliminate ineffective steel manufacturers and outdated technology.

“Restructuring is inevitable and only really capable manufacturers can overcome this hard time and develop further,” he said.

Cuong said steel consumption last month fell by 100,000 tons against August to only 385,000 tons while the figure this month was expected to plunge to 300,000 tons.

He said the decline in the construction market was the main cause.

He said that the unsold inventory also rose with the declined consumption, with the current index recorded at 350,000 tons a month, doubling the usual figure.

Though the unsold inventory index has yet to reach the alarming rate, what is actually threatening the industry is that the current rate will remain high for several months to come, he said.

“Worse yet, since steel manufacturers are facing low consumption at a time when lending rates are high, they have to lose more on clearing banks interest,” Cuong said.

“A ton of unsold steel will cost a business an interest of up to VND300,000.”

He said many businesses thus had to cut production by up to 70 percent to curb the rising unsold inventory.

Some manufacturers have even shut down production.

“Even when they can sell all of the unsold products, some businesses still cannot afford to pay for labor wages, let alone clearing bank loans.”

He said while most manufacturers had opted to cut production to survive the crisis, some had sought ways to export their products.

Steel exports are expected to reach $1.4 billion from January to October this year and $1.8 billion for the whole year.

“The Vietnam Steel Association will ask the Ministry of Industry and Trade to assist steel manufacturers to overcome difficulties,” he said.

Vietnamese goods win consumer trust

After more than two years of implementing the “Vietnamese people use Vietnamese goods” campaign, the proportion of Vietnamese goods selling at most supermarkets has increased considerably, according to the Centre of Business Studies and Assistance (BSA).

Domestic goods make up 70-90 percent of the total goods on sale as more and more consumers prefer to buy Vietnamese goods instead of those imported from Thailand, Indonesia and Malaysia.

The Big C supermarket has taken the lead in launching promotional programmes, providing local manufacturers with useful information about both consumer demand and taste to help them produce high quality products.

Vu Kim Hanh, BSA director said that there should close cooperation among state management agencies, businesses, distributors and consumers to make Vietnamese goods secure a firm foothold in the country.

While management agencies are focused on raising public awareness of the quality of Vietnamese goods, promoting trade activities, businesses should create new designs to catch attention of customers.

The organizing board of the “Bringing Vietnamese goods to rural areas” programme said apart from basic consumer goods and production tools, local customers are also in need of electronics and mechanic products.

Over 120,000 tonnes of cassava exported to China

Vietnamese businesses have so far this year exported more than 120,000 tonnes of cassava to China through Lao Cai international border gate.

In the first half of October alone, 15,000 tonnes were transported to China through the gate, earning VND35 billion.

Currently, a kilo of fresh cassava costs VND1,650 and a kilo of dried cassava is priced at VND4,950.

This year, the Lao Cai provincial Department of Customs has streamlined procedures to facilitate the export of fresh and dried cassava. It takes businesses less than an hour to have their customs procedures cleared.

The department has granted certificates of origin (C/O) to more than 120,000 tonnes of cassava exported to China.

“We give top priority to seasonal farm products, including cassava”, says Tran Vu Hoang, head of the Customs Service of Lao Cai international border gate. “We offer incentives to export businesses in terms of transport, parking lots and customs clearance.”

Cassava is mostly harvested in Lao Cai, Yen Bai, Phu Tho and Lai Chau provinces and sold to Chinese businesses for food and industrial alcohol processing.

Vietnam, RoK firms join in aluminum production

The Vietnam National Coal and Mineral Industries Group (Vinacomin) and Dongyang Gangchul Company of the Republic of Korea (RoK) will cooperate in an aluminium production project.

An agreement to this effect was signed between the two firms in Hanoi on October 26.

The project includes an aluminium electrolysis plant and an accompanying power plant, plus an aluminium production facility.

Addressing the signing ceremony, Vietnamese Deputy Minister of Industry and Trade Le Duong Quang stressed that the RoK is an important partner of Vietnam in economic development cooperation.

The RoK is the 4th largest export market of Vietnam. The country has 2,800 investment projects in Vietnam with a combined value of over US$23 billion.

RoK Ambassador to Vietnam Ha Chan-ho expressed hope that cooperation between the two firms would bring practical benefits to both countries.

Export turnover bounces back

After three months of losses, Vietnam’s October export revenue reached US$8.3 billion, up 4.5 percent against the last month, said the General Statistics Office (GSO).

According to statistics, the total value of exports in the first ten months reached US$78 billion, a rise of 34.6 percent compared to the same period last year.

Textile and garment exports account for the biggest contributions with a value of US$11.7 billion, up 29.4 percent from last year’s period, followed by seafood at US$4.92 billion (up 22.8 percent). Wood and wood products, machinery, spare parts, electronics products, and computers also contributed to the revenue.

Meanwhile, import surplus in the first ten months dropped to US$8.39 billion, making up 9.7 percent of export turnover and dropping by 10.8 percent from last year’s period.

It is estimated by the National Assembly that 2011 export revenue will reach US$95 billion, up 31.6 percent against 2010, and the trade deficit will reach US$10 billion, accounting for 10.5 percent of export turnover.

Poor dyeing investment leaves mark

Dwindling textile and dyeing investment is hurting the sector’s development prospects.

Many targets set in Vietnam’s textile and garment industry development strategy until 2015 with a vision towards 2020 will not come true since a sequence of textile and dyeing projects remained on the drawing board due to capital strains.

As planned, from 2011-2015 the textile and garment sector will inject capital into 20 yarn factories, 14 textile and dyeing plants and 96 garment plants with a total investment exceeding VND42 trillion ($2.02 billion).

However, the sector has had to delay most of its investment projects amid current hostile business climate.

Vitas chairman Vu Duc Giang said the investment cuts would hurt the sector’s overall development.

Estimates show that $15 million investment would be required to build a 10 million square metre annual capacity dyeing plant, where as $500,000 was needed to put a garment plant online. The sector’s proposed 14 textile dyeing plants would require $420 million.

Besides, according to Vietnam Cotton and Spinning Association chairman Nguyen Son, said environment dangers meant investors into these projects would need to pump money into standardised waste-water treatment facilities, thus scaling up investors’ capital expenditure.

To tackle the capital dilemma, the sector planned to focus on boosting garment production and export for market expansion. But, in the meantime it will call for businesses to form associations and set up joint ventures with foreign manufacturers to raise investment into specialised industrial clusters.

In the first nine months of 2011, the textile and garment sector raked in $10.5 billion in export value. However, it spent over $9 billion on material and accessories import with $5.024 billion put into importing fabrics, $805 million into cotton and over $2 billion into accessories imports.

Agro-forestry and seafood export value reaches $20.8b

Exports of agro-forestry and seafood products during the first 10 months of this year reached an estimated US$20.8 billion thanks to high prices, reported the General Statistics Office (GSO).

Agriculture exports were estimated to earn $11.6 billion, a year-on-year increase of nearly 45 per cent, the GSO said.

Meanwhile, seafood export value was worth $4.95 billion, up by 23.2 per cent against the same period last year. Forestry products brought the country $3.4 billion, an increase of 16.2 per cent over last year.

Most agriculture products reached new records in export revenue this year, according to the GSO.

In October alone, export turnover for the industry was at about $2.2 billion, the office said.

No fuel price cut, traders losing
 
The Ministry of Finance has announced it would not lower the retail price of petrol at present.

"Petrol traders are still facing losses. It is estimated that they lost about VND600 per litre of petrol last month, so we cannot cut prices," the ministry said.

The ministry explained that the domestic petrol price was based on world average prices from September 25 to October 24, which were higher than current domestic charges.

According to the ministry, the average price of petrol during this time in the Singapore market was US$119.37 per barrel. Meanwhile, diesel was $121.24 per barrel and the prices of kerosene and fuel oil stood at $121.56 and $650.04 per barrel respectively.

After fees and taxes had been added, each litre of petrol cost traders VND600, the ministry said.

The losses incurred from the sale of kerosene and fuel oil were VND356 and VND519 respectively. Meanwhile, each litre of diesel earned traders a profit of just VND18.

The ministry said it and the Ministry of Industry and Trade would monitor world prices and make adjustments when necessary.

In an interview with domestic media several days ago, the Minister of Finance Vuong Dinh Hue shared that the first thing he did every morning was check petrol prices.

If the opportunity arose, the price would be cut immediately, but at present, global prices were still high, Hue said.

In the middle of this month, the MoF decreased the cost of domestic diesel and kerosene, but petrol and fuel oil prices remained unchanged.

At that time, diesel prices fell by VND400 per litre and kerosene by VND300 per litre to VND20,400 and VND20,200 per litre respectively.

Meanwhile, retail prices for RON 92 petrol and RON 95 petrol were unchanged, respectively standing at VND20,800 per litre and VND21,300 per litre.

Da Nang revokes industrial licenses of 17 projects  

The Da Nang Management Board for Industrial and Export Processing Zones has decided to revoke the industrial licenses of 17 projects, because of slow project implementation since they were signed in 2010.  

The 17 projects include eight foreign-investment projects and nine domestic-investment projects.

The investors of 15 other projects have also been asked to send in a report on project implementation to the Da Nang authorities. The report must categorically state all reasons for delay in project implementation.

Currently there are six industrial and export processing zones in Da Nang City, covering a total area of 1,106 hectares. The city has attracted investments for 333 projects, of which 69 are foreign-investment projects worth US$618.5 million and 264 are domestic-investment projects worth VND10,234 ($5,117 million).

Vinacomin signs deal with S Korean firm

The Viet Nam National Coal and Mineral Industries Group (Vinacomin) and Dongyang Gangchul, South Korea's leading aluminium producer, agreed to study proposals for three aluminium projects in Viet Nam, following a co-operation agreement inked yesterday between the two companies.

These projects would include construction of an alumina refinery, a plant supplying electricity for the refinery and a factory producing aluminium products.

"After this, Dongyang Gangchul will soon conduct a feasibility study, expected to cost US$200,000, on building an aluminium refinery and then advise Vinacomin on a suitable location and technologies," said Vinacomin General Director Le Minh Chuan.

Chuan said it was important to accelerate work with foreign companies to speed up development of the country's fledging aluminium industry.

Vinacomin is also developing the Nhan Co alumina refinery plant in the Central Highland province of Dak Nong. The construction of the plant will be finished in late 2012.

Property market heats up

The capital's real estate market is heating up via many old apartments being purchased at billions of Vietnamese dong, based on substantial consumer demand.

People mostly prefer to live as centrally as possible, surrounded by good infrastructure related to hospitals, schools, entertainment and transport, experts said.

Due to such demand, old apartment prices have been pushed up, some in Dong Da, Ba Dinh and Hai Ba Trung districts reaching around VND50 million (US$2,300) per square metre.

Tran Thi Hanh, owner of a VND5billion ($230,000) apartment, said that at such a price, she could have bought a high-end pad in either Cau Giay or Ha Dong districts instead.

However, she said that she had decided on an old apartment to enjoy convenient transportation services.

Commenting on high real estate prices, former Deputy Minster of Natural Resources and Environment, Dang Hung Vo,õ told Xay Dung (Construction) newspaper that it was an indispensable market trend.

Sellers had the right to ask high prices just as buyers had the freedom of purchasing an apartment or walking away, he said.

In another development, the city's Department of Construction has drawn up a list of 85 old building blocks, mostly in Dong Da, Thanh Xuan, Ba Dinh, Hai Ba Trung, Hoang Mai, Cau Giay and Ha Dong districts, currently in bad shape and in need of inspection.

The local People's Committee has called on the department to co-operate with related authorities to carry out examinations.

S Korean firms get CSR awards

Viet Nam's support of corporate social responsibility (CSR) has seen businesses make major contributions to balancing the effects of globalisation, in areas such as the environment, labour rights and social welfare, according to a deputy minister of planning and investment.

Dang Huy Dong made the statement at the CSR Award ceremony for South Korean Investors in Viet Nam which was held in Ha Noi yesterday, adding that CSR allowed businesses to expand into diverse markets.

"CSR is a commitment to contribute to sustainable economic development by improving working conditions which in turn benefit firms as well as society," he said, adding that businesses should follow standards of environmental protection, gender equality, labour safety and worker training.

The inaugural award ceremony was jointly held by Viet Nam's Ministry of Planning and Investment and the South Korean Ministry of Knowledge Economy (MKE) and also marked 20 years of diplomatic relations between Viet Nam and South Korea and the contribution of Korean companies to Viet Nam development, while raising the profile of CSR practises in Viet Nam.

Award winners included Chang Shin Incorporated in southern Dong Nai Province, Doosan Heavy Industries Viet Nam in central Quang Ngai Province and Posco E&C, which all employ more than 300 workers and were honoured as the largest contributors of South Korean CSR in Viet Nam.

Nanotech, based in northern Bac Ninh Province and Auntex, based in southern Binh Phuoc Province employ less than 300 people and won an encouragement award for medium-sized enterprises to contribute to CSR.

The event drew considerable attention and received widespread support from South Korean business circles throughout the country, with the Korean Trade and Investment Promotion Agency receiving a large number of applications from South Korean companies operating in a number of fields including construction, heavy industries, manufacturing, electronics and insurance.

Prizes were awarded based on companies' efforts to improve working conditions, support policies for victims of industrial accidents, prevent industrial accidents, foster community partnerships to protect the environment and ecological protection efforts.

Director of the MPI's Foreign Investment Agency Do Nhat Hoang said social contributions from South Korean enterprises had improved working conditions and the environment, which were highly appreciated by the Vietnamese Government.

Loans to rescue coffee, cashew processors
 
The Ministry of Agriculture and Rural Development has asked banks to make low interest loans available for the purchase and processing of coffee and cashews, worth a total of VND45 trillion (US$2.15 billion).

The ministry's Circular 3017/BNN-CB urged banks to provide the six-month loans to the coffee and cashew sector to overcome cashflow difficulties and high input costs.

Coffee and cashew processors needed capital late in the year to buy raw materials to process for export to take advantage of approaching holidays, the ministry said.

But the Viet Nam Coffee and Cocoa Association and the Viet Nam Cashew Association had complained of difficulties in getting loans due to high interest rates of 20-22 per cent, the ministry said.

The coffee association said the banks had imposed conditions, including financial ability, export volume and the number of years exporting, that made many coffee enterprises ineligible for loans.

The cashew association complained that high interest rates and input cost, and pressure to repay principal at the end of the year had forced firms to sell cashews at low prices.

Therefore, based on export ability and demand on capital for the year end production, the ministry asked banks to provide VND16 trillion ($766 million) in "soft-interest" loans at 17-19 per cent with flexible conditions.

It asked that the cashew sector get VND29 trillion ($1.38 billion) in loans with preferential interest rates, including VND13 trillion ($622 million) to buy raw cashew locally, VND13 trillion to import raw cashews and VND3 trillion ($144 million) in long-term loans to upgrade equipment and machinery.

The coffee association said that at the end of this month and early next month, it would sign co-operation agreements with the Agriculture and Rural Development Bank (Agribank) and Technological and Commercial Bank (Techcombank) to provide loans for enterprises purchasing coffee in the 2011-12 crop.

At a meeting last month with export enterprises in Central Highland Dak Lac Province, Agribank undertook to provide loans of VND5 trillion ($239 million) during the 2011-12 harvest starting next month, a bank representative said.

Meanwhile, other banks said at a meeting between banks and coffee and cashew trading enterprises in Ha Noi last week they would provide enough capital for coffee trading enterprises. The banks included the Viet Nam Joint Stock Commercial Bank for Industry and Trade (Vietinbank), Bank for Investment and Development of Viet Nam (BIDV) and Joint Stock Commercial Bank for Foreign Trade of Viet Nam (Vietcombank).

The coffee association said if the sector had the capital, it would likely export 1.2 million tonnes of coffee this year, to earn an expected $2.4 billion.

The export value of coffee had increased sharply in recent years but most of the exports were raw coffee, so the industry has planned to increase the export volume of processed products by 20 per cent.

Cashew association chairman Nguyen Thai Hoc said despite the many obstacles in production and business, the industry was predicted to earn $1.3-1.4 billion from exports this year.

So far of this year, Viet Nam has exported 129,000 tonnes of cashew, earning $1.1 billion, a year-on-year reduction of 7.8 per cent in quantity but a year-on-year increase of 38.6 per cent in value due to the sharp increase in export price from $8,809 to $9,500 per tonne in July.

PV