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BUSINESS IN BRIEF 30/3

Decree brings change to securities market, Telephone exports hit $5.45b by mid-March, Israel to invest in Kien Giang, Vietnam exports nearly 537,000 tonnes of rice, Capital, tax crunch restricts rice, seafood export

Forex market calms down after SBV pledges to stabilise rate

The foreign exchange (forex) market cooled down yesterday after the State Bank of Viet Nam (SBV) committed to keeping the exchange rate stable.

All commercial banks had cut their rates by 30 to 40 dong per US dollar yesterday, compared with the rates fixed earlier this week. File Photo

All commercial banks had cut their rates by 30 to 40 dong per US dollar yesterday, compared with the rates fixed earlier this week.

Vietcombank listed the rate at VND21,465/21,525, down 40 dong.

BIDV and Vietinbank also cut the rate by 35 dong to VND21,465/21,525 and VND21,475/21,535.

Eximbank and ACB also adjusted their rates down by 30 dong to VND921,450/21,530.

The inter-bank exchange rate yesterday remained at VND21,458, while the rate quoted at the central bank's transaction offices was also kept stable at VND21,350/21,600.

SBV Deputy Governor Nguyen Thi Hong said the central bank had no plans to adjust the exchange rate for now, adding that there was no need to worry about recent developments in the forex market.

Hong reiterated that forex rates would be adjusted by no more than 2 per cent this year as part of a pledge made by Governor Nguyen Van Binh in December last year.

In January, the SBV had devalued the dong by 1 per cent from VND21,246 to VND21,458 per US dollar, the first exchange rate adjustment since June 2013.

Though the US dollar recently rose against the dong, it was still far below the cap of VND21,673 per dollar set by the central bank and the currency market was still seeing normal operations, Hong said, adding that the central bank had not felt the need so far to sell the greenback and intervene in the market.

Hong attributed the recent increase in the forex rates in the domestic market mainly to psychological factors, following the appreciation of the greenback in the world market.

For the past week, as the forex rate increased roughly VND120 against the previous weeks, some suggested that the central bank should further depreciate the dong to back domestic goods and support exports.

They said that the rise in value of the greenback in the global market had driven a series of central banks around the world to devalue their currency.

However, Hong said, the greenback had only risen strongly against key currencies, such as the euro, British pound and Canadian dollar, with whom Viet Nam's trading was not extensive.

She said keeping the exchange rate unchanged at the moment was more beneficial than devaluing the dong, because 90 per cent of the material for Viet Nam's exports was purchased from abroad.

Therefore an increase in the value of the US dollar would hurt exporters since input costs would escalate, especially as demand for imported materials was rising, Hong explained.

She said despite posting a trade deficit of US$1.75 billion during the first three months of 2015, the Vietnamese economy still enjoyed a balance of payments surplus of $2.8 billion, owing to funds from remittances and foreign investment capital.

VN-Index set for rough week

The VN-Index may continue to fall this week as investors are losing patience and continue to sell to escape from the market, securities companies forecast.

According to Saigon Commercial Bank Securities JSC (SBS), the VN-Index may decline to a range of between 520 to 530 points this week.

In addition, Bao Viet Securities JSC (BVSC) said that foreign investors would most likely remain net sellers this week, but their total net selling value could decline, and the improving large-cap stocks, especially bank codes, would be enough to balance foreign investors' selling.

Last week, foreign investors sold stocks worth VND710.89 billion (US$33.8 million), mostly blue chips, on the national stock market, creating heavy pressure on both bourses and causing them to decline throughout the week.

On the HCM City Stock Exchange (HOSE), foreign investors were net sellers five sessions in a row, recording a total net selling value of VND613.23 billion (US$29.2 million), 96 times the value recorded the previous week.

Gas blue chips were the most sold large-cap stocks, including the PetroVietnam Drilling & Well Service Corporation (PVD) and PetroVietnam Gas JSC (GAS). These two stocks had a rough declining week and were the major factors that dragged the market down.

However, the increase in the world oil price to $50 per barrel did not have any effect on the national market as the government kept the domestic price unchanged.

As many as 3.2 million PVD shares worth VND149 billion ($7 million) and 1.5 million GAS shares worth VND106.4 billion ($5 million) were sold in the market.

In addition to PVD and GAS, shares of other blue chips, including Saigon Securities Incorporation (SSI) and Hoang Anh Gia Lai JSC (HAG), were also sold in large volumes of 2.5 million shares worth VND52.7 billion ($2.5 million) and 3.2 million shares VND68.7 billion ($3.27 million), respectively.

Also, on the Ha Noi Stock Exchange (HNX) foreign investors were net sellers in five consecutive sessions, with a total net selling value of VND97.66 billion ($4.65 million).

Gas codes were the most sold stocks on the market, with PetroVietnam Technical Service JSC (PVS) having 2.23 million shares sold, worth VND52.7 billion ($2.5 million).

Furthermore, the total market liquidity recorded a sharp drop last week as the HOSE saw 454.5 million shares being traded, a decrease of 17.3 per cent. Its total trading value also dropped 13.8 per cent to VND8.5 trillion ($404.7 million). In addition, the trading volume of the HNX decreased 6.5 per cent to 283.8 million shares worth VND2.77 trillion ($131.9 million), a decrease of 11.6 per cent.

The stock that gained the most market value in the southern market was Angiang Fisheries Import & Export JSC (AGF), posting a rise of 27.78 per cent to stand at VND23,000 per share.

In the northern market, the top gainer was HCM City Textbook Printing JSC (SAP), recording a 23.46 per cent gain in market value to close at VND10,000 per share. 

Upbeat securities firms to increase their charter capital

Many securities companies have recently announced plans to increase their charter capital, confident that the domestic stock market still has a lot of room for expansion in 2015.

According to many brokerages, stock indices on both exchanges in the country registered lower growth rates than expected by market participants and this lays a good foundation for stronger development this year.

The most impressive plan has come from KIS Vietnam Securities Corporation, which plans to raise its charter capital from the current VND263.6 billion (US$12.3 million) to VND1.113 trillion ($52 million) through a private share issue.

The Korean-invested company explained that it wanted to expand brokerage services to cover derivative products, which under the current regulation requires charter capital of securities companies be from VND900 billion ($42.1 million).

After the capital increase, KIS Vietnam will advance into the list of 10 largest securities companies in Viet Nam.

Early this week, the Vietnam Investment Securities Co (IVS) also approved a plan to raise its capital from VND161 billion ($7.5 million) to VND350 billion ($16.4 million) this year. In a document sent to shareholders, the company expressed confidence in the market outlook.

It said the market had room for development given the probable reduced inflow as a result of Circular 36, which limits lending for stock investments by commercial banks to 5 per cent of their (the banks') charter capital.

"Securities are a more attractive investment option at present compared to gold, foreign currency or real estate," it said.

However, the company also said it might not be easy to earn quick profits, and authorities needed to issue additional regulations to facilitate cash inflows, as well as introduce more investment products.

IB Securities Co (VIX) announced it would issue an additional 30 million shares to double its charter capital from VND300 billion ($14 million) to VND609 billion ($28.5 million). The shares would be offered to existing shareholders and its employees, the company said.

According to the company, stable economic development and accelerated equitisation of State-owned enterprises as well as their plans to divest from non-core businesses this year will release more quality products into the market, attracting both domestic and foreign investors.

Even a small brokerage firm like Royal Securities Corporation has announced its plan to hike its capital from VND35 billion ($1.6 million) to VND135 billion ($6.3 million). It plans to sell 10 million shares to shareholders at VND10,000 a share.

Telephone exports hit $5.45b by mid-March

Telephone exports fetched US$5.45 billion by mid-March or accounted for 19 per cent of the nation's total export value, the General Department of Customs said.

This positive result enabled telephone exports to overtake garments and textiles as the largest export commodity during the reviewed period, the department said.

Can Tho works to improve local competitiveness

The Viet Nam Chamber of Commerce and Industry's branch in the Mekong Delta city of Can Tho is running programmes to enhance local businesses' competitiveness for integration, vietnamplus.vn reported.

The programmes are designed to provide training services for local businesses to build their human resource capacity, connect them with foreign investors and potential partners, and strengthen performance of relevant associations to ensure benefits for local businesses, especially small and medium-sized enterprises.

Local businesses were also advised to devise measures to lower their product prices by using alternative domestic sources, reducing reliance on imported materials, and cutting down on intermediaries by working directly with clients and foreign partners.

Cambodian province seeks investment from Binh Phuoc to build bridge

Binh Phuoc will consider investing in the construction of a large bridge on Highway 7 connecting Cambodian Kratie province with the locality, as heard during a working session between top provincial officials on March 25.

During the function, Kratie’s Deputy Governor Huu Sidem thanked Binh Phuoc for its assistance in the provincial Mekong River festival and proposed the bridge be sponsored by the southern Vietnamese province.

He reported the Cambodian Interior Ministry’s decision to organise a ceremony marking the signing of a cooperation memorandum of understanding between the two provinces.

Huu Sidem invited Binh Phuoc leaders to visit his province on the occasion of the local traditional New Year Choi Chnam Thmay.

For his part, Nguyen Van Tram, Chairman of Binh Phuoc People’s Committee, hoped to boost socio-economic affiliation and urged the official signing to facilitate bilateral trade and border security.

He said his province will examine the bridge’s scale and design before deciding on its investment.

Construction begins on fibre and garment complex in Quang Nam

The Vietnam Textile Group (Vinatex) broke ground on a fibre-weaving-dyeing and garment complex in Que Son district in the central province of Quang Nam on March 25.

At the ground-breaking ceremony, Deputy Prime Minister Nguyen Xuan Phuc asked Vinatex to coordinate with the locality to tackle compensation and site clearance and ensure environmental hygiene.

The 10-hectare complex will cost over 1.2 trillion VND (55.8 million USD) and consist of a fibre plant with an annual capacity of 6,500 tonnes, a 6,000-tonne dyeing plant, a garment plant and waste water treatment facilities with a designed capacity of 5,000 cubic metres per day.

The complex is an intensive investment project in the central region in preparation for the Trans-Pacific Partnership Agreement (TPP). It will provide material for boosting the textile and garment industry in Quang Nam , Da Nang and other neighbouring coastal central provinces .

Once operations commence in the third quarter of 2017, the complex will create jobs for 2,000 local labourers.

According to the Vietnam Textile and Apparel Association, Vietnam has 250 industrial parks nationwide, but only Nam Dinh, Hung Yen and Binh Thuan province have areas reserves for developing the fibre-weaving-dying industry.-

Decree brings change to securities market

Vietnam's State Securities Committee (SSC) on March 25 held a workshop to publish changes to Decree 58/2012/ND-CP, which aim to implement and amend the Securities Law in order to improve the efficiency of the national stock market.

Vu Quang Viet, director of SSC's Legal Affairs Department, said that by March 20, the national stock market had total capitalisation of VND1.2 trillion (US$57.1 million), representing 30.6% of Viet Nam's GDP.

Over the past two and a half years, the national stock market had recorded an average trading value of VND3.16 trillion (US$150.4 million) each session, with 679 stocks listed on the market with total face value of VND441 billion (US$21 million), he said.

Decree 58 also helped securities companies restructure to improve their financial management, internal administration and risk management, he added.

In an attempt to improve the Decree, the SSC has collected ideas and opinions from Government agencies, investors and companies involved in the securities business.

Viet said that the new Decree would complete the legal framework for the securities market to match international rules, solve market problems for individuals and organisations, attract foreign investment and create a fair and transparent securities environment.

It would focus on several major issues, including private placement, in which shares were sold to a small number of selected investors without public announcement, and public placement, in which shares are made available for sale on the public market, he said.

According to the amended decree, private placements are intended to raise capital, reduce debts or exchange stakes in other companies (for public limited companies), or to transform into public limited companies (for securities companies).

Any company that wants to issue private placement has to complete the sale within 90 days of the SSC receiving all of its registration papers.

If a company organises a shareholder meeting before a private placement is completed, the board of directors will have to ask for permission from shareholders to continue.

The board of directors can only change plans on the use of capital if they are approved by shareholders and comply with company regulations, and has to publish the amended plans to investors within 10 days.

The company also has to report the total capital raised from issuing private placements at shareholder meetings, and have it reviewed and confirmed by auditors.

On the other hand, individuals and organisations cannot issue public placements if the organisation is unqualified to issue a public placement or the organisation is selling shares publicly to become a company.

However, there are some exceptions for an organisation to sell shares, including transforming into a securities company, or selling the state's stake from a state-owned company to the public.

Public placements must be run by securities issuing companies, except for state-owned organisations selling their shares to non-state investors, or big shareholders selling their stakes in public limited companies, or securities firms selling the warrants or rights to the market.

Israel to invest in Kien Giang

At a recent meeting with Kien Giang People’s Committee leaders, the Israeli Ambassador to Vietnam announced a plan to invest and provide ODA to the province.

Provincial People’s Committee Vice Chairman Nguyen Thanh Nghi expressed his hope that Israel would support US$170 million in ODA for a new general hospital.

Ambassador Shahar also affirmed she would continue supporting expanded cooperation between Israel and Kien Giang and committed to advocate Israeli businesses invest in the locality.

Healthy demand in food industry drives additive market

UBM Asia announced on March 24 that it is organising a food additive trade fair – Fi-Vietnam 2015 – in HCM City this coming May 20-22.

In making the announcement, UBM Asia’s director said the firm recently conducted a study that projected significant growth in Vietnam’s packaged food industry over the next few years.

Vietnam remains a major market for food additives due to the prospects for higher penetration of processed and packaged foods, convenience foods, non-alcoholic beverages, bakery items, ready-to-eat food products and cereals in the future, the director said.

Food additives are substances used for enhancing the taste, colour and texture of food products. They also prevent microbial growth and increase the shelf life of food products.

The event is expected to attract more than 150 foreign manufacturers of food additives and other parties interested in the industry.

Dai-ichi Life named Best Life Insurance Company

The Dai-ichi Life Insurance Company of Vietnam Ltd has been named the – Best Life Insurance Company in Vietnam at its annual Golden Dragon Awards Ceremony.

The award is given annually to recognize a progressive company that shows leadership in the industry in a number of areas, including financial results, operational efficiency and effectiveness, and a commitment to improving relationships with clients.

The company was established in January of 2007 as a wholly-owned Japanese firm doing business in Vietnam. It currently serves one million customers through a network of 600 staff and 30,000 financial consultants at 140 offices across the country.

In 2014, its new business premium revenues reached VND965 billion (US$45 million), up 36% on-year, total premium income VND2.55 trillion (US$120 million), up 37%. Its pre-tax profit was estimated at VND248 billion (US$11.6 million), up 23%.

Businesses cope with information security risks

The Security World 2015 Conference and Expo was held in Hanoi on March 25 to work out measures to deal with information security risks.

Themed “Strengthening Information to Protect Privacy & Enable Trust in Today’s Risk Landscape”, the event was considered as a good venue for government agencies, organizations and businesses to meet, seek cooperation opportunities and exchange information and experience about updated trends as well as the latest technology solutions from which they can build strategies to effectively invest in information security.

Participants provided in-depth discussions to help government agencies, organizations, businesses update technology trends, approach effective information security and risk management solutions for businesses’ sustainable development and ensure the high level of security and safety.

They discussed measures to cope with information security threats and put forward key initiatives that help businesses keep pace with constantly evolving threats and security requirements in today’s interconnected business ecosystem.

Leading experts and representatives from government agencies and businesses also shed light on intelligent cyber security, security principal, early-warning system, security threats: strategies and techniques.

Besides the conference, an exhibition also took place to showcase modern technology solutions in Network Security, Cloud Security, Big Data Encryption, Virtualization, etc.,. Many leading IT firms and security solution providers participated in the event, such as Cisco, Samsung, Paolo Alto Networks, Trend Micro, Parasoft, Jupiter Network, and HP.

According to a recent report by Kaspersky Security, Vietnam ranks 6th in top 10 countries worldwide by number of attacked users by malware. Security risk is at an alarming rate while Vietnam ranks 4th globally with nearly 50% of users are at risk of malware infection while using the Internet.

Microsoft also estimates that around 80% computers in Vietnam are infected by malware and malicious software.

The Vietnam Information Safety Association (VNISA) reports that most of agencies and organizations in Vietnam allow personal devices (mobile and tablet) to access the network at work but 74% of them do not use any information security protection.

These figures have raised big concerns and also put a significant pressure on leaders and IT experts to find solutions to deal with the insecure environment nowadays.

Vietnam exports nearly 537,000 tonnes of rice

The Vietnam Food Association (VFA) has revealed that by March 19, the country had earned US$241.334 million from exporting around 536,570 tonnes of rice.

The current price of rice stands at US$470.5 a tonne, a drop of 1.36% compared to the same period last year.

Notably, Gana and Ivory Coast has become Vietnam’s 2nd and 3rd largest rice importers respectively, making up 31.19% of the country’s total rice market share.

In the Mekong Delta, dried normal rice paddy is being sold at VND5,150-5,250/kg while long grain rice paddy at VND5,400-5,500/kg.

Rice exports see difficulties due to oversupply

The Vietnam Food Association (VFA) on March 24 said that rice exports would continue facing difficulties because of surplus supply sources in rice export nations and Thailand’s boosted measures to clear their stocks, causing a competition in rice prices in the world.

That was revealed at a seminar on rice and seafood export conditions held by the Export Import Department under the Ministry of Industry and Trade in the Mekong Delta city of Can Tho.

According to VFA’s statistics, businesses have shipped 537,000 tons of rice from January 1 until March 19 bringing US$237 million, down 41.36 percent in volume and 40.52 percent in value over the same period last year.

Average export price was US$440.18 per ton in FOB (Free on Board) term, up US$6.21 over a year ago.

Total rice volume in export contracts was up 7 percent to reach 1.94 million tons as of March 19. Of these, 1.4 million tons have yet to be delivered.

Besides, businesses still have 1.4 million tons in stock waiting for exports.

The export value of other farm produce and seafood products was estimated at US$4.2 billion in the first quarter this year, a year on year reduction of 15.8 percent. This group of commodities accounts for 11.7 percent of total export items.

CEC continues grilling Transport Ministry over Long Thanh airport project

The Central Economic Commission (CEC) of the Communist Party of Vietnam yesterday continued grilling the Ministry of Transport over Long Thanh International Project that is planned to replace overloading Tan Son Nhat Airport in Ho Chi Minh City.

At the rehearsal meeting, commission head Vuong Dinh Hue proposed the ministry and relevant agencies to clarify some matters related to the project such as the precision of the ministry’s data on Tan Son Nhat International Airport, Long Thanh’s competitive ability in the role of a transit airport, the impact of its construction on public debts, runway design, and site clearance and capital reclaiming measures.

Transport Minister Dinh La Thang affirmed the accuracy of the ministry’s data related to Tan Son Nhat International Airport, which will go overloaded by 2017. Meantime, it is impossible to upgrade and broaden Bien Hoa military airport in Dong Nai Province to ease pressure for Tan Son Nhat because investment costs accelerate to US$5.7 billion.

Mr. Thang said that Long Thanh Airport will be built in three phases and social investment will be encouraged to reduce a financial burden of the state budget. The Government will just attend in building items forcing it to do so.

According to the Government’s latest report on the Long Thanh project, total investment fund of Long Thanh Airport is estimated at US$15.8 billion, down nearly US$3 billion compared to the number provided before. The new number is calculated basing on construction costs of similar projects which have been implemented in the world.

Capital, tax crunch restricts rice, seafood export

The crunch in lending capital and taxes is a major contributor to the sharp export decline in terms of both volume and value, stated the Ministry of Industry and Trade (MoIT) at a meeting in the city of Can Tho on March 24.

According to the Export and Import Department under the MoIT, as of March 19 this year, Vietnam has exported 535,571 tonnes of rice valued at 236 million USD, down 41.3 percent in volume and 40.5 percent in value.

The country shipped 1.28 billion USD worth of seafood from the beginning of the year, representing a decrease of 19.8 percent from the same period in 2014, according to the department.

In order to counter the declining trend, the department asked provinces to effectively implement credit and tax policies including rescheduling and restructuring the debts of households, farm owners, and cooperatives.

Provinces have been asked to strictly monitor the quality of farm produce and seafood, effectively manage and plan material areas and boost trade promotion in traditional markets like the United States, the European Union, and Japan.

Can Tho calls for Japanese investment in seven new projects

The Mekong Delta city of Can Tho has called on Japanese investors to invest in seven new local projects in agricultural machine manufacturing, high-tech agricultural areas, and fishery centres.

The city made the request during a working session between municipal leaders and representatives from Tokyo University and two Japanese securities and financial groups on March 25.

The projects include the construction of a factory for manufacturing and assembling agricultural machines, valued at 30 million USD, and the development of two agricultural areas applying high technology worth 33.9 million USD.

Can Tho also called for investment in another high-tech farming area in Co Do district with a total capital of 10 million USD for producing and multiplying rice varieties.

The Mekong Delta fishery centre project is estimated to cost 400 million USD, and another project to build infrastructure for O Mon industrial park needs 130 million USD in investment.

The Japanese investors were also encouraged to pour capital into a five-star hotel and conference hall worth 45.5 million USD.

According to Assistant Professor Dr. Kawashima from Tokyo University’s Faculty of Agriculture, Japanese investors are shifting their investments to ASEAN countries from China with Vietnam among its prioritised markets.

He pledged to help Can Tho introduce the projects to more Japanese investors.

GDP likely to grow by 5.5-5.6 percent in Q1: official

Vietnam’s gross domestic product (GDP) is likely to expand by 5.5-5.6 percent in the first quarter, much higher than growth seen in same period last year, Deputy Minister of Planning and Investment Dao Quang Thu forecast, though the General Statistics Office’s official figure has not been released.

The 2015 GDP growth target of 6.2 percent will be achieved if such a trend is maintained throughout the year, Thu said at a meeting reviewing the socio-economic context in Hanoi on March 25.

The March industrial production index rose by 25.8 percent from the previous month and by 9.1 percent from a year earlier, according to the Ministry of Industry and Trade.

A number of products recorded substantial growth from Q1 of 2014 including mobile phones (up by over 100 percent), automobiles (52.6 percent) and footwear (up 16.3 percent).

Meanwhile, export revenue in Q1 reached 35.7 billion USD, climbing 6.9 percent from 2014. Some commodities saw observable shipment increases, including telephones & components (21.9 percent) and textiles & garments (7.8 percent).

The retail sales of consumer goods and services during January-March increased by nearly 10 percent annually.

At the meeting, some voiced concerns over foreign investment attraction and capital disbursement.

As of March 20, Vietnam had licensed 267 foreign investment projects worth more than 1.2 billion USD, nearly doubling the number of projects but dropping 40.6 percent in registered capital from a year before.

Some 621 million USD were added to 102 existing projects, down 40.6 percent in value and up 2.5 times in the number of projects from Q1 in 2014. New and additional registered capital totalled more than 1.8 billion USD, tumbling 45 percent.

Current capital disbursement is relatively low, said a representative of the Finance Ministry, elaborating that only 26 trillion VND (1.23 billion USD) of investment capital—or 15 percent of this year’s target—was disbursed between January and March.

Dang Xuan Quang, Deputy Director of the Ministry of Planning and Investment’s Foreign Investment Agency, said the three-month figures are not accurate representations of the entire year, adding that he is optimistic about foreign direct investment attraction in 2015.

Vietnam approves tax treaty with Iran

The Government recently approved a mutual tax avoidance agreement between Vietnam and Iran.

The day the pact will come into effect has yet to be determined.

As of July 15, 2014, Vietnam had tax treaties with 69 countries and territories across the globe.

Accordingly, residents of contracting nations are taxed at a reduced rate or are exempt from Vietnamese taxes on income or gains they receive from Vietnamese sources. These reduced rates and exemptions vary among countries and specific items of income. Meanwhile, Vietnamese residents or citizens are taxed at a lower rate or are exempt from foreign taxes on income or gains they receive from foreign countries.

The treaties also form legal frameworks facilitating cooperation among taxation agencies of contracting countries to prevent tax evasion.

Vietnam to set stronger tone for SOEs restructuring

Prime Minister Nguyen Tan Dung has requested drastic actions to restructure State-owned enterprises (SOEs), with a focus on equitisation and withdrawal of State capital from non-core business lines.

As of March 24, 289 SOEs on the waiting list of equitisation already established Steering Boards in charge of the process. Up to 207 of them were evaluating their assets while 81 others planned to announce their worth.

Nationwide, as much as nearly 7 trillion VND (333 million USD) invested in non-core business lines has been recollected, mostly in the military-run telecom Viettel, the Vietnam National Oil and Gas Group, the Vietnam Posts and Telecommunications, the Electricity of Vietnam, the State Capital and Investment Corporation.

In January-March, 18 SOEs auctioned 100 million shares and earned 805 billion VND (38.3 million USD).

During a working session with the Steering Board for SOE Renovation and Development in Hanoi on March 26, the Government chief asked for perfecting SOEs restructuring plans and clearing barriers to the reshuffle, which he said, is running slowly.

Restructuring SOEs is a focal political task of the Government, therefore, it requires unanimous consent and concerted efforts by the entire political system, agencies, localities and business community, he noted.

Directing tasks for the coming time, he requested SOEs to constantly overhaul their production and governance while going through open and transparent procedures to be listed on the stock market.

Concluding the event, he ordered stepping up supervision of ministries, agencies, localities, and SOEs over the restructuring process.

PM: Modern public administration crucial to business climate

Prime Minister Nguyen Tan Dung has demanded the use of technological advances to modernise public administration through e-government systems, considering it essential for a better business climate.

Vietnam needs to make more of an effort in this aspect, the PM told a teleconference in Hanoi on March 26 after noting Vietnam ranked 78th of 189 economies on the ease of conducting business in the World Bank rankings, which he called a disappointing result.

He asked ministries, agencies and localities to determine processing time limits for their units, adding that the outcomes of specific reforms will be announced to the public during the Government’s June meeting.

Regarding institutional reform, the leader requested the fine-tuning of laws, policies, and socialist-oriented market economy mechanisms to create an improved legal framework.

A market economy must follow the principles of competition and operate in a fair, open and transparent manner, encompassing different economic sectors with different forms of ownership, the PM noted, making it clear that the Vietnamese economy is to be managed through tools, policies and resources in a way that ensures social progress and fairness.

When issuing legal documents, localities should evaluate its feasibility and ensure it supports human rights and the rights to freedom and democracy in line with the Constitution, he reminded.

As of January 1, 2015, the duration for processing corporate tax payment was cut by 370 hours from the initial 872 hours, reported the Ministry of Home Affairs.

Customs departments nationwide have used the Vietnam Automated Cargo and Port Consolidated System and the Vietnam Customs Information System (VNACCS/VCIS) since November 2014, which has reduced the time for imports and exports custom clearance by 7.6 hours and 9.6 hours, respectively.

Vietnam is in the process of negotiating a protocol on the legal framework for the application of the ASEAN One-Stop Shop customs mechanisms and preparing to expand the ASEAN single window mechanism towards the birth of the ASEAN Community in early 2016.

The ministry is also working on a range of legal regulations for renewed policies for civil services and its staff; several new mechanisms are being piloted in the recruitment of public servants and managers and the generation of job title standards.

Upgraded oil exploration facilities inaugurated

A ceremony was held on March 26 in Binh Son district, Central Quang Ngai province by the Dung Quat Shipyard Company (DQS) to inaugurate upgraded versions of two oil exploration facilities.

The vessels include the floating storage and offloading unit “FSO PVN Dai Hung Queen” and the oil rig “FPU Dai Hung – 01”, worth a combined 85 million USD.

The two were handed over to the Petrolimex Transportation and the PetroVietnam Exploration Production Corporation (PVEP – POC), respectively.

The upgrades will serve the oil exploration and production in Dai Hung oilfield within the continental shelf of Vietnam, contributing to ensuring national energy security and boosting socio-economic development, said Tran Minh Ngoc, Chairman of the DQS Member Council.

The FSO PVN Dai Hung Queen, weighing 105,000 tonnes and with a top speed of 26 kilometres per hour, is equipped with advanced facilities and technologies. The FPU Dai Hung-01 rig is 108.2 metres long and 67.36 metres wide.

At the ceremony, Deputy Prime Minister Hoang Trung Hai instructed t he Vietnam National Oil and Gas Group (also known as the PetroVietnam) to continue restructuring the DQS towards improving its operations and developing its ship building industry.

The PetroVietnam was also called on to implement projects to construct and upgrade additional modern vessels, rigs, and floating units to reduce the reliance on importing high-tech services.

The inauguration and delivery of the two vessels marked the DQS’s first major outputs since 2010 when the company separated from the Vietnam Shipbuilding Corporation (Vinashin) and merged with the PetroVietnam.

Q1 agro-forestry-fishery export value down from last year

Vietnam’s export revenue from agro-forestry-fishery products in the first three months of this year has been estimated at 6.13 billion USD, a 13.2 percent decrease from the figure recorded in the same period during 2014.

Of the total figure, farm produce exports were valued at 2.92 billion USD , down 15.1 percent; seafood exports generated 1.27 billion USD , an annual decline of 20.6 percent; and forestry product exports brought home 1.5 billion USD, a drop of 0.4 percent, according to the Ministry of Agriculture and Rural Development.

Tea, cashew nut and pepper all saw decreases in export volume but increases in value. During the three months, Vietnam exported 24,000 tonnes of tea, 51,000 tonnes of cashew nut and 38,000 tonnes of pepper for 38 million USD, 370 million USD and 342 million USD, respectively.

Coffee and rice exports recorded drops of both volume and value during the reviewed period.

The country shipped abroad 350,000 tonnes of coffee worth 734 million USD in the first three months, drops of 41.4 percent in volume and 37.3 percent in value. Meanwhile, 1.01 million tonnes of rice were sold, earning 440 million USD, down 28.1 percent in volume and 32 percent in annual value.

Despite reducing its orders from Vietnam , China is still Vietnam ’s largest rice importer with nearly 21 percent of the market share.

Local food industry inks promotion agreement

Ho Chi Minh City's Food and Foodstuff Association has signed an agreement with exhibition organiser UBM Asia to promote its activities and help its member companies find partners.

Ly Kim Chi, Chairwoman of the Association, said the agreement is very important since food and foodstuff producers in Vietnam find it difficult to source ingredients locally because of a dearth of producers, and UBM can put them on to foreign suppliers of new food spices and additives.

UBM is highly experienced in the industry and had links with many international food ingredient producers, she said.

From May 20 to 22 this year it will organise Food Ingredients (Fi) Vietnam 2015 in HCM City with an estimated 150 local, regional and international ingredient suppliers and 4,000 food and beverage professionals attending.

Central bank says to keep forex rate stable

The State Bank of Vietnam (SBV) will not adjust the Vietnamese dong-US dollar exchange rate despite an increase in the price of USD on the world market, SBV Deputy Governor Nguyen Thi Hong said to the Vietnam News Agency on March 25.

The decision was made after thorough considerations of import-export and foreign debt, she stated.

She added that based on the domestic and international currency and macro-economic developments, maintaining the current exchange rate will be more profitable than adjusting the rate.

According to her, the foreign exchange market in Vietnam remains stable with transactions worth around 1.1-1.2 billion USD per day.

On the afternoon of March 25, the exchange rate remained below 21,500 VND to 1 USD, well below the ceiling rate of 21,673 VND as regulated by the SBV.

The central bank pledged to continue regulating monetary policy tools and implementing other necessary measures to stabilise the foreign exchange market.

Finance ministry okays more tax, customs red tape cuts

The Ministry of Finance has issued decisions approving the removal or simplification of various administrative procedures in taxation and customs.

Accordingly, six of the 46 procedures will be removed – one in tax and five in customs – while the remaining 40 administrative formalities will be simplified, with seven in tax and 33 in customs.

The decision comes in response to the government's Decision No.19/NQ-CP, dated March 12, 2015, on major tasks and solutions for improving the business environment and national competitiveness.

Under the decision, the tax payment time will be shortened to less than 121.5 hours per year, while the time to complete premium payments for social insurance will be less than 49.5 hours per year.

The percentage of local enterprises conducting electronic tax declarations will be over 95 percent, and the rate of electronic filings for corporate tax payment will be at least 90 percent.

The additional reductions and simplification are expected to create more favourable conditions for people and enterprises completing tax and customs administrative procedures.

They will also contribute to facilitating the effective implementation of the ministry's envisaged solutions to reduce the processing time for tax and customs procedures to the average level of the ASEAN-6 countries by the end of 2015.

Finance Minister Dinh Tien Dung said that fulfilling the government's instruction would require preparation from all sectors.

He said the finance sector was implementing solutions related to the ASEAN Economic Community (AEC) integration and pledged to meet integration requirements when Vietnam takes part in the AEC in late 2015.

According to the business community, tax and customs were among the first sectors to achieve significant reforms of administrative procedures last year. Under the ministry's reforms, the tax payment time last year was shortened from 537 hours per year to 247 hours (exclusive premium payment time). The tax payment time is currently 167 hours, as per the amended Law on Taxes, which came into effect on January 1, 2015.

The percentage of local enterprises conducting electronic tax declarations last year also increased from 65 percent to 95 percent.

Vietnam coffee favoured in Singapore

Vietnamese coffee accounted for one-fourth of Singapore’s total coffee import volume in 2014, marking its strong foothold in the regional market.

According to Vietnamese Trade Counsellor in Singapore Nguyen Viet Chi, annual export revenue of Vietnamese coffee and tea to Singapore grew an average of 68 percent per year from 2012 to 2014. In 2014 alone, revenue reached 102 million USD.

Singapore is a gateway to several potential markets for Vietnam, she said.

After 8 years of operating in Singapore, popular Vietnamese trademark Trung Nguyen Coffee has gained local favour for its good quality reputation.

ANZ: Vietnamese economy is recovering

Vietnam’s economy has bottomed out and is now showing signs of recovery with stable foreign direct investment (FDI) capital and increased trade surpluses, said ANZ Chief Economist for South Asia, the ASEAN & Pacific Glenn Maguire.

The expert made the remark as the Australia-New Zealand Banking Group (ANZ) released its report on the Vietnamese Consumer Confidence Index for March.

According to the report, the index has decreased slightly to 141.5 in March, down 0.8 points from February. Despite the reduction, March’s index is still above the 2014 average of 134.5.

Of the respondents, 58 percent (the same level from last month) expect their families to be “better off” financially this time next year compared to just 4 percent (down 3 percent from February) who expect to be “worse off” financially.

Looking ahead, 61 percent (down 5 percent) expect to see growth in the Vietnamese economy over the next five years, compared to 4 percent (down 4 percent) who predict difficult economic times, the lowest rate since February 2014.

Maguire said low petroleum prices have improved household spending and overall incomes have increased, but a number of Vietnamese are still hesitant to purchase major household items.

The report showed that domestic demand is recovering and Vietnamese families remain confident and expect economic progress over the next five years.

Maguire added that policies in Vietnam should be adjusted to reflect the country’s recovering demand.

Bac Giang attracts over 40 investment projects in Q1

The northern province of Bac Giang has attracted 33 domestic and 10 foreign-invested projects worth a combined 144 million USD thus far this year.

According to the provincial Department of Planning and Investment, the large-scale projects include a 40.5 million USD factory specialising in granite tiles and a 30 million USD electronic headphone production plant.

In the second quarter of this year, the locality will continue improving its business climate to lure more investment through addressing difficulties related to land clearance.

The province also plans to ask the Government to approve the establishment of the Chau Minh-Mai Dinh Industrial Park while working with investors to accelerate infrastructure construction in the Van Trung, Quang Chau and Dong Khe-Noi Hoang industrial parks.

Investment promotion activities will also be intensified, targeting potential markets such as Japan, the Republic of Korea (RoK) and Taiwan (China) and giving priority to processing, manufacturing and high-tech projects.

Bac Giang is calling for investment in shopping-service centres, commercial housing and tourism sites in Bac Giang city and Viet Yen, Lang Giang and Son Dong districts.

Projects in agriculture are also being encouraged, focusing on industrial-oriented cattle, poultry breeding and medicinal plant and mushroom growing in Son Dong, Yen Dung and Lang Giang districts and poultry breeding in Tan Yen, Yen The, Hiep Hoa and Luc Ngan districts.

Bac Giang has thus far registered 871 investment projects with a total capital of over 4.2 billion USD.

Among 10 countries and territories investing in the locality, the RoK has the largest contribution with 90 projects.

As many as 130 foreign-invested projects are operating in the province, creating jobs for nearly 65,000 employees. In the last quarter, industrial production value by the foreign investment sector reached 7.9 trillion VND (371 million USD), an annual rise of 16.9 percent.

ACB honored “Most improved retail bank in Asia Pacific 2015”

The Asia Commercial Bank (ACB) was recently honored with the “Most improved retail bank in Asia Pacific 2015” award by the prestigious Asian Banker Magazine.

Selection criteria were based on outstanding performance and breakthrough developments in the fields of operation process, product development, risk management and IT.

ACB was the only bank to receive the award in the Asia-Pacific region.

In 2014, the bank’s total assets exceeded 179 trillion VND (8.5 billion USD), up 8 percent from 2013, and total pre-tax profits reached 1.2 trillion VND (57.6 million USD) a 17 percent rise from previous year.

Other indexes have shown improvement; the bank’s bad debt ratio decreased considerably from 3.1 percent in 2013 to 2.2 percent in 2014.

The bank’s Capital Adequacy Ratio (CAR) reached 14 percent compared to the minimum ratio of 9 percent required by the State Bank and the Loan-Deposit Ratio (LDR) was 75.2 percent.

ACB is one of the leading joint stock commercial banks in Vietnam. Founded in 1993, the bank now has over 350 transaction offices nationwide with nearly 10,000 employees.

Forex market calms down after SBV pledges to stabilise rate

The foreign exchange (forex) market cooled down on March 26 after the State Bank of Viet Nam (SBV) committed to keeping the exchange rate stable.

All commercial banks had cut their rates by 30 to 40 dong per US dollar on March 26, compared with the rates fixed earlier this week.

Vietcombank listed the rate at VND21,465/21,525, down 40 dong.

BIDV and Vietinbank also cut the rate by 35 dong to VND21,465/21,525 and VND21,475/21,535.

Eximbank and ACB also adjusted their rates down by 30 dong to VND921,450/21,530.

The inter-bank exchange rate yesterday remained at VND21,458, while the rate quoted at the central bank's transaction offices was also kept stable at VND21,350/21,600.

SBV Deputy Governor Nguyen Thi Hong said the central bank had no plans to adjust the exchange rate for now, adding that there was no need to worry about recent developments in the forex market.

Hong reiterated that forex rates would be adjusted by no more than 2 per cent this year as part of a pledge made by Governor Nguyen Van Binh in December last year.

In January, the SBV had devalued the dong by 1 per cent from VND21,246 to VND21,458 per US dollar, the first exchange rate adjustment since June 2013.

Though the US dollar recently rose against the dong, it was still far below the cap of VND21,673 per dollar set by the central bank and the currency market was still seeing normal operations, Hong said, adding that the central bank had not felt the need so far to sell the greenback and intervene in the market.

Hong attributed the recent increase in the forex rates in the domestic market mainly to psychological factors, following the appreciation of the greenback in the world market.

For the past week, as the forex rate increased roughly VND120 against the previous weeks, some suggested that the central bank should further depreciate the dong to back domestic goods and support exports.

They said that the rise in value of the greenback in the global market had driven a series of central banks around the world to devalue their currency.

However, Hong said, the greenback had only risen strongly against key currencies, such as the euro, British pound and Canadian dollar, with whom Viet Nam's trading was not extensive.

She said keeping the exchange rate unchanged at the moment was more beneficial than devaluing the dong, because 90 per cent of the material for Viet Nam's exports was purchased from abroad.

Therefore an increase in the value of the US dollar would hurt exporters since input costs would escalate, especially as demand for imported materials was rising, Hong explained.

She said despite posting a trade deficit of US$1.75 billion during the first three months of 2015, the Vietnamese economy still enjoyed a balance of payments surplus of $2.8 billion, owing to funds from remittances and foreign investment capital.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR

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