OVs invest in 900 businesses in Ho Chi Minh City

Overseas Vietnamese have invested in more than 900 businesses in Ho Chi Minh City with total registered capital of US$1.8 billion focusing on infrastructure, trade centers, and waste treatment.

More than 300 OV experts and intellectuals are now working at schools, hospitals, and research centers in the city.

Nguyen Thi Minh Phuong, Deputy Chairwoman and Secretary General of the municipal Liaison Association for Overseas Vietnamese said in recent years Ho Chi Minh City’s administration has promulgated incentives to support OVs to invest and do business in their homeland as well as connect domestic enterprises at home and abroad.

“We have kept close contacts with OVs, especially those in Western European countries, the US, and Canada and they also have close links with the municipal administration,” said Phuong, adding that “whenever they come back to Vietnam, they can seek support from the association. This is the strength of Ho Chi Minh City.”

Demand growing for safe food, proper labelling in Vietnam

The number of supermarkets in Vietnam has been steadily rising over the past decade, having gone from just 47 in 2005 to 975 in 2016, according to Hong Kong market research firm Cimigo.

The rise in supermarkets bears a direct correlation to the increased purchasing power of Vietnamese households, researchers at Cimigo postulate, citing the number of households earning over US$500 monthly has more than doubled during the same period.

In raw numbers, they note the number of high-income households went from 1.8 million in 2005 to more than four million in 2016.

This relationship between household income and supermarkets is vitally important for those farmers, businesses and other organizations operating in the agriculture and related food segments to understand, says PhD Dao The Anh.

Mr Anh, who is the Director at the Centre for Agricultural Research and Development in Hanoi, says the phenomena reflects a heightened interest by Vietnamese consumers in food safety.

These higher income consumers will no longer accept the items put on the store shelves as safe and are digging deeper into the food chain and developing an increased awareness of where the food originates and its processing.

Mr. Anh adds that these higher income consumers are also now requiring more informative labeling on foods such as fresh vegetables.

In a live market, consumers can buy fresh produce at a much lower price, but with more money in their wallets, those with higher incomes are migrating to the supermarkets where they can judge for themselves whether the food is safe.

And they look to informative labelling to make the decision to purchase, says Mr Anh.

Most importantly, they are willing to spend more on fresh produce they deem to be safe than eat cheaper low quality food they are unsure about that is sold in the live markets.

A prevalent fear among these consumers is that the food may have originated in China.  In Vietnam, it is universally accepted that food that originates in China is unsafe for human consumption.

As a result, farmers and other businesses in the agriculture and food segments need to pay more attention to labelling of their products. Those that don’t will ultimately pay a steep price in loss of sales to the higher income consumers, Mr. Anh warns.

Of note, Mr Anh points out that most all small and most large business concerns in Vietnam have in the past ignored food safety and labelling, possessing a take it or leave it attitude towards consumers.

That is, except for VinEco, a subsidiary of VinGroup, says Mr Anh.

VinEco put food safety at the top of its business strategy early on and has been making big investments totaling in the hundreds of millions of US dollars to ensure its customers that its foods— are safe and properly labelled.

Organic and safe foods are still in short supply in local markets throughout Vietnam, cautions Mr Anh, but farms are gradually making the transition to shift to organic fertilizers.

That explains why in large part VinEco made the decision to produce safe foods themselves. There simply was no alternative supply other than importing fresh vegetables and other produce from foreign markets at cost prohibitive prices.

Consumer purchasing behaviour is changing rapidly, says Mr Anh, noting it’s the conduct of the farmers that is not shifting fast enough. If farmers want to meet market demand they must make the transition to organic with good packaging and labelling.

Otherwise consumers will bypass their products in favour of other products and a cheap price is not the decisive factor in making the decision to purchase, Mr Anh concludes.

Binh Duong records $1.7 billion trade surplus in Q1     

The southern province of Binh Duong has recorded a trade surplus of US$1.7 billion in the first quarter of 2017, thanks to businesses using locally-sourced raw materials for production.

During the first three months of the year, the province earned $6.36 billion from exports, mostly of wooden products, textiles and garments and footwear; while its imports came to $4.66 billion, a provincial People’s Committee report said.

The province also saw a breakthrough in attracting foreign direct investment (FDI). As of mid-March, it had lured more than $1.34 billion in FDI. Of the total, $793 million is from 43 newly licenced projects; the rest is from 18 projects that got additional capital.

To date, the province has attracted 2,890 foreign-invested projects worth around $27.1 billion, data revealed.

Between January and March, the province’s Index of Industrial Production rose by 7.3 per cent compared to the same period last year. Its total revenue from retail trade and services reached around VND39.6 trillion ($1.74 billion) in the first quarter, up 19.7 per cent year-on-year.

During this three-month period, the province approved the setting up of 966 new enterprises with a total investment capital of VND5.39 trillion, while allowing 166 operating ones to raise their capitals by a total of VND3.73 trillion.

The committee said it would continue to improve the province’s investment and business climate and would hold dialogues with representatives of associations and enterprises to resolve the problems that businesses face. 

Increase localisation, Hyundai urged     

President Tran Dai Quang on Tuesday asked the Hyundai group to support its Vietnamese partner in personnel training and technology transfer, and increase the localisation rate of its products made in Viet Nam.

Receiving Hyundai Motor Vice Chairman Chung Eui-sun in Ha Noi, he said Viet Nam would create all possible conditions for foreign firms, including those from the Republic of Korea (RoK), to do long-term business in the country.

Welcoming Chung’s working visit at a time the two countries are celebrating the 25th anniversary of diplomatic relations, Quang highlighted the vigorous growth in bilateral ties.

He said the countries had established a strategic co-operative partnership in 2009 and have maintained high-level visits, helping bolster mutual understanding and political trust.

The President also cited impressive outcomes in economic, trade and investment co-operation, including the signing of a bilateral free trade agreement (FTA).

The RoK has become Viet Nam’s top foreign investor, the second biggest ODA provider and tourism partner, and the third largest trade partner, the President said.

The RoK’s direct investment in Viet Nam is surging, exceeding US$3.1 billion in the first two months of 2017, he noted.

Quang said he hoped that on the basis of the sound political ties and the Viet Nam-RoK FTA, Hyundai Motor would continue expanding investment in Viet Nam.

Chung Eui-sun said Hyundai Motors had set up a joint venture to manufacture, assemble and distribute cars in Viet Nam almost a decade ago. The joint venture’s automobiles have since been shipped to other countries in the region, he said.

The group has received substantial co-operation and assistance from Vietnamese partners and local authorities, he said, adding that the group would send experts to Viet Nam to train partner staff.

He attributed the RoK’s soaring direct investment in Viet Nam to appropriate policies and effective assistance provided by the Vietnamese State and Government.

Aside from stepping up investment and technology transfer, Hyundai Motor would further engage in social welfare projects in the country, Chung Eui-sun said.

Vingroup invests VND5 trillion in Vinpearl South Hoi An     

The property and retail conglomerate Vingroup JSC (Vingroup) kicked off construction of the Vinpearl South Hoi An Complex on Sunday.

The complex has investment capital of VND5 trillion (US$220 million) and covers an area of 200ha. It is located in Binh Duong Commune, Thang Binh District, in the central province of Quang Nam.

Vinpearl South Hoi An will include hotels, Vinpearl villas, Vinpearl Golf sports centre and Vinpearl Land amusement park, as well as shopping zones and VinEco hi-tech agriculture area.

The project is divided into two phases. The first phase is expected to be finished on March 3, 2018, with the completion of hotels, villas, convention centre, restaurants and hi-tech agriculture zone. The second period is estimated to cover infrastructure, amusement park and sports centre by 2019.

This complex is located favourably between Hoi An Ancient Town and Mỹ Sơn sanctuary, two world cultural heritages. This will help the project provide high-class tourism services for domestic and foreign tourists.

“The groundbreaking ceremony of Vinpearl South Hoi An Complex is a significant event for Vingroup, not only because it marks the expansion of Vinpearl, but also because it is the first time to launch a five-star complex. We commit to implement the project on schedule with high quality, contributing to Quang Nam Province’s tourism development and becoming a key economic sector in the future,” Vingroup deputy chairman Nguyen Viet Quang said at the ceremony.

According to plans, the complex will provide jobs for some 1000 local workers when it is completed in 2019. 

Three hospitals of Transport Ministry suspend equitisation

Deputy Prime Minister Vương Đình Huệ has approved the Ministry of Construction’s proposal on suspending equitisation of three hospitals, according to the Government Office.

The deputy PM’s office issued letter 2753/VPCP-DMDN on March 23 in which it mentioned three hospitals - Nam Thăng Long Hospital, Vinh Transport Hospital and Transport Hospital in Đà Nẵng. 

In early 2017, the ministry sent a letter to the Government in which it proposed suspension of the equitisation of these three hospitals, chinhphu.vn reported.

A leader of Nam Thăng Long Hospital quoted by Người tiêu dùng (Consumers) newspaper as saying that equitisation would convert the public hospital into a for-profit entity, meaning it would only serve those patients with adequate financial ability, instead of those having low and medium incomes. At present, the hospital has been satisfactorily calling for more financial resources outside the State budget.

Meanwhile, Vinh Transport Hospital and Transport Hospital in Đà Nẵng have been able to manage their own financial matters this year. The Ministry of Transport has, therefore, asked for a suspension of their equitisation to let them operate with financial autonomy.

Interest rate increase likely to affect housing market: CBRE

Raising deposit interest rates may affect the real estate market, a press conference organised by Commercial Real Estate Services (CBRE) Vietnam in Hà Nội on Monday heard.

CBRE Vietnam managing director Marc Townsend said many commercial banks in Việt Nam have raised long-term deposit interest rates by 1-2 percentage points to up to 9.2 per cent when the US Federal Reserve increased the interest rate in March.

The adjustment will hike pressure on lending interest rate, which can cause negative impact on the housing market, he said, adding that investors may shift their investment to other fields such as the stock market.

According to a survey conducted by CBRE, Việt Nam ranks fourth on the list of the best places to invest in, following Australia, Japan and China.

Việt Nam is one of the two largest spenders in infrastructure development in the region, CBRE said.

Ca Mau to host Shrimp Festival

The People’s Committee of Ca Mau province yesterday received a documentary from Governmental Office about hosting Shrimp Festival  under a direction of Vietnamese Deputy Prime Minister Trinh Dinh Dung. 

Ca Mau has the country’s largest shrimp output and cultivation.

Accordingly, the deputy prime minister directed the Ca Mau People’s Committee actively collaborates with ministries, departments, agencies and relevant organizations to set up detail preparation for the event.

Additionally, the leader also urged Ministry of Culture, Sports and Tourism to quickly adopt requirements of the Prime Minister about regulation of the shrimp festival.

According to Vice Chairman of the Ca Mau People’s Committee Le Van Su, the coastal province in Mekong Delta has the country’s largest shrimp output and cultivation. 

Shrimp products have been exported to 90 worldwide countries and territories with an annual turnover up to over US$ 1 billion, accounting 35 percent of shrimp export turnover of the country.

Vietnamese startups mobilize $205 million in 2016

The community of Vietnamese startups mobilized the record high capital of US$205 million last year, according to statistics by Topica Founder Institute.

The funds reduced about 25 percent over 2015 and increased 46 percent over the previous year.

Startups from financial technology took the lead with the total raised amount of $129 million.

In 2016, there were seven funds raising deals with the value of over $10 million. They number includes four deals with capital exceeding $15 million.

Foreign investors continued transgressing domestic firms in both the number of deals and capital amount.

$23,711 invested in high-tech Park

The Saigon Hi-Tech Park yesterday granted investment license to the Tay Saigon School (Western Saigon Vocational College) to build research and international training cooperation center.

The center covers an area of 17,550 meter square with total investment of VND540 billion ($23,711). 

It is aimed to carry out research, application and transfer of technology and training in the field automated technology, new material technology, precision mechanism, biology, waste treatment technology, solid waste and environment protection.

The school plans to enroll from 2,000 to 3,600 students.

South at high risk of power shortage

Southern Vietnam will run the risk of falling short of electricity in 2018-2019, so if there is no solution, a serious power shortage would occur, said Deputy Prime Minister Trinh Dinh Dung during his tour of several power projects in Soc Trang and Hau Giang provinces on Friday.

“The accelerated pace of constructing power plants, especially in the south, along with the upgrade of transmission projects, is a key task for 2017 and beyond,” he said.

In order to meet the electricity demand by 2030, the Mekong Delta region alone has to invest in 16 thermal power projects along with renewable power developments, in addition to more electricity purchases from neighboring countries. The development of thermal power plants also leads to a great need to build ports and warehouses to supply coal and gas to power plants.

According to a report of Vietnam Electricity Corporation (EVN), the peak demand for power output in the south in 2016 was 13,262 MW, an increase of 12.4% compared to 2015, and the total commercial electricity output in 2016 reached 76.85 billion kWh in the southern region, accounting for 48.1% of the nation’s total.

From 2017, it is necessary to mobilize oil-fueled power generation in the South with capacity of about 8.6 billion kWh per year. In the coming years, the output of thermal power generation will highly depend on supplies of fuels, especially imported gas and coal.

To ensure power supply for the south in 2016, the north-south power transmission lines was always operated at full tilt high loads, with electricity transmission from the north and the midland to the south amounting to over 15.8 billion kWh, about 18% of the south’s electricity demand.

Besides, EVN has operated several power projects, including Vinh Tan 2, Duyen Hai 1 and O Mon 1. At present, EVN and other investors are implementing some projects such as Duyen Hai 3 expansion and Vinh Tan 4, and are preparing to invest in Quang Trach and Tan Phuoc thermal power plants.

However, the two power plants Long Phu 1 and Song Hau 1 play a particularly important role, greatly affecting the ability to provide electricity for the south. However, both projects are in slow progress although the investors and contractors have made great efforts.

At a meeting after an inspection, Deputy Prime Minister Trinh Dinh Dung asked the investors and contractors to report in detail the progress, difficulties and problems in the process of constructing Long Phu 1 and Song Hau 1 thermal power plants to find appropriate solutions.

In addition, Dung asked for synchronized solutions to minimize power shortages, including ensuring progress schedule, operational safety, quality management of power projects as well as environment protection and power usage effectiveness.

Many banks lower VND deposit rates

While some banks are racing to issue certificates of deposit with interest rates of more than 9% per year, quite a few others have brought down their interest rates for savings in Vietnam dong by 0.1-0.3 percentage point, says Dan Tri news site.

VPBank has reduced its deposit rates by 0.1-0.3 percentage point for all tenors. Thus, the annual interest rates for savings of seven, 12 and 15 months are now 6.9%, 7.1% and 7.3% respectively.

At Viet Capital Bank, the interest rate for six-month deposits in dong has fallen 0.1 point. Longer tenors of 18 to 60 months are now offered a rate of 7.8% per annum.

Similarly, Vietbank has lowered its deposit rates by 0.1-0.3 percentage point for seven-month, 12-month and 15-month terms. VIB has also revised down the rates by the same margins for all terms, with the sharpest cut applied to 3-5 month terms.

Maritime Bank has decreased its deposit rates for 18-36 months from 7.4% to 7.2%. DongA Bank has announced an interest rate reduction of 0.1 percentage point for one-month savings.

Many banks have launched deposit certificates with high interest rates, up to 9% per year, such as Sacombank, LienVietPostBank and VPBank.

But not all certificates of deposit come with tenors of five to seven years as those released by Sacombank. Viet A Bank, for example, only offers terms of six to 18 months with interest rates of 6.9-8.2% per annum.

Some banks such as DongABank and SCB even apply attractive interest rates of 5.4-5.5% a year to short terms of 1-4 months. The 6-9 month tenors come with an annual interest rate of 6.9%.

Inflationary pressure in the first two months of the year (a total rise of 0.7%) is another factor forcing banks to consider adjusting their interest rates as depositors’ expectations change.

Baoviet Securities Company (BVSC) attributed higher interest rates to banks restructuring their funds as Circular 06 on lowering the percentage of short-term capital for medium- and long-term loans from 60% to 50% officially came into force in early 2017. 

The final factor is the external pressure from the Fed’s interest rate hike roadmap. It is expected that after the increase on March 15, the Fed will carry out two more rate hikes this year and three more in 2018.

BVSC says that if the ceiling interest rates on foreign currency deposits at home remain at zero, overseas remittances and indirect investment will likely undergo a certain degree of reversal.

However, a representative of the State Bank of Vietnam deemed it very normal that banks adjust their interest rates according to their business strategies and market conditions. Due to the need for capital at a certain time, a number of joint stock banks may put up their interest rates partially and temporarily, and later bring them down in accordance with market supply and demand.

“In fact, the liquidity of the entire banking system is still ample, and the market is under no pressure to raise interest rates. Therefore, in general, the deposit and lending interest rates at joint stock banks remain stable,” the State Bank of Vietnam confirmed.

Vietnam Star Phu My Hung showcases new corporate identity

Vietnam Star Automobile, the largest Mercedes-Benz dealer in Vietnam, last week launched the ultra-luxury Mercedes Maybach S400 and introduced Vietnam Star Phu My Hung with a brand-new corporate identity.

Vietnam Star Phu My Hung diversifies its premium product line-up with Mercedes-Maybach S400 4MATIC, an interesting addition to the ultra-luxury Mercedes-Maybach S-Class supercar in Vietnam, besides Mercedes-Maybach S600. The Mercedes-Maybach S400 is priced at VND6.899 billion, with VAT included.

To outperform customer expectations, Vietnam Star Phu My Hung will offer the Service Difference package including lounge area, express service, mobility and happy hours from May 2017.

“For more than 10 years in Vietnam, we have been making every effort to strengthen our position and customer trust for Vietnam Star Automobile as well as Mercedes-Benz. When coming to Vietnam Star Phu My Hung, we believe that customers will experience the 5-star service and enjoy more utilities. This is our point of difference in the market,” said Eugene Losew, general director of Vietnam Star Automobile.

One of the unique points at Vietnam Star Phu My Hung is smart space utilization and outstanding combination of subtle black and silver, offering customers positive experience and create a deep emotional brand engagement.

Every single corner from service lounge or display area, customers can take a seat to enjoy a cup of cappuccino and a selection of snacks while waiting for cars being serviced, or being advised by salesmen about new cars, or simply needing an inspirational space to figure out new ideas.

Especially, the 5-star service lounge is friendly and modern with exclusive massage chairs to help customers relax during the waiting time.

Besides, the modern iShowroom technology ensures personal experience at the highest standards. In the VIP room, customers can choose color and interior design combination simply by a touch. Immediately, the 360-degree simulation model of the selected car will be shown to help customers easily visualize his favorite car lively.

In addition to maximizing personal experience, Vietnam Star Phu My Hung aims to have space for a whole family as it wants to become a friendly and harmonious destination with children’s playground. Customers can enjoy the most premium service together with family members.

Customer service is also enhanced from the human factor. Vietnam Star Phu My Hung staff are trained under the Mercedes-Benz global standards, from professional car knowledge, core brand values and soft skills such as customer understanding psychology.

Covering 10,000 square meters, Vietnam Star Phu My Hung can display up to 20 vehicles at the same time in the showroom. In addition, the award-winning workshop can service more than 30 vehicles per day, ensuring the minimum waiting time for customers.

Hanoi taxman names 262 corporate tax debtors

The Hanoi Tax Department has publicized the names of 262 enterprises with tax arrears totaling VND2.2 trillion (US$96 million) in an effort to force them to fulfill their tax obligations, Dan Tri news website reports.

Vietnam Industrial Electronics Group Corporation is the largest debtor with VND75.5 billion (US$3.3 million), followed by Vietnam National Sundries Import and Export Joint Stock Co. (JSC) with VND75.1 billion, Viglacera Mechanical and Construction JSC with VND57.9 billion, and Construction Installation and Industrial Material Co Ltd with VND57.1 billion.

This is the fourth time this year the department has named the names of the corporate tax debtors on its website. In its previous releases, there were 372 companies owing some VND408.1 billion.

The department said recovering tax arrears is a vital task to meet the State budget collection target.

The department has taken drastic measures to coercively deduct money from tax debtors’ accounts, announce their invoices as invalid, or urge them to come directly to tax offices to make tax payments. In addition, it has worked with the media to publicize their names.

Ca Mau suitable for organic shrimp farming

Ca Mau, with its vast mangrove forest, is in a good position to adopt the organic shrimp farming model to bring higher economic value to farmers and better adapt to climate change, said experts at a two-day workshop on the matter in the country’s southernmost province.

In a statement issued on March 28 after the workshop on Vietnam’s organic production and development, experts said organic shrimp farming in Ca Mau has proven more effective in reality. The workshop was jointly held by German development agency GIZ, SNV Netherlands Development Organisation (SNV), the Naturland Association for Organic Agriculture, and Saigon Co.op.

According to GIZ, more than 2,000 households and four enterprises have joined the organic shrimp farming program and helped shrimp farmers increase output by 15% compared to the traditional farming method.

This is not only proven by shrimp farming households joining the GIZ program but also reflected by some enterprises in Ca Mau.

Le Van Quang, chairman and general director of Minh Phu Seafood Corporation, confirmed the suitability of Ca Mau for organic shrimp farming after his company had applied the model in some areas and realized the economic potential of this model.

Therefore, according to Christian Henckes, director of Integrated Coastal Management Program (ICMP) under GIZ, Ca Mau’s organic shrimp farming model will help Vietnamese shrimp better penetrate demanding markets and bring higher value.

A large area under tiger shrimp farming in Ca Mau’s mangrove forest has been certified to meet international standards such as Naturland, EU Organics and other standards, bringing additional benefits to producers.

Organic production can bring higher value to Vietnamese products like organic shrimps in the world market, and aid the sustainable coastal protection process of the Mekong Delta.

Currently, international customers demand high food quality standards for shrimp and other agricultural products while the market for organic products has huge growth potential, Henckes said.

EU-bound tra fish export poised to decline further

Vietnam’s exports of tra fish to the EU are forecast to continue declining sharply this year, but shipments to China are on the rise, said the Vietnam Pangasius Association (VN Pangasius) at a conference in Can Tho City on March 28.

While the Chinese market has recently stepped up import of tra fish, or pangasius, from Vietnam,

From early this year to mid-February, exports of pangasius to China reached over US$27.4 million, up 53% over the same period last year and accounted for 16.7% of total tra exports. Meanwhile, exports to the EU in this period fell 17.6% to US$25.2 million and accounted for 15.3% of the sector’s total.

Tra exports to the EU market have faced difficulties recently, especially since Carrefour, Europe’s largest retailer, stopped importing the fish from Vietnam.

“With the current situation, the fall in exports of Vietnamese agricultural products, including tra, to the EU will continue,” said Vo Hung Dung, vice president and general secretary of VN Pangasius.

According to Dung, although the Vietnam-EU free trade agreement (EVFTA) can benefit Vietnam’s economy, the future of agricultural commodities would be unclear.

Meanwhile, Yohan Perrault, technical and marketing director for Asia of EuroCham, said news about the unqualified Vietnamese products in the EU market had caused a big dent to the export of Vietnamese agricultural products in general and tra fish in particular.

Yoann Perrault told the conference that Vietnam had 11 shipments returned by the EU recently due to the contamination of bacteria, viruses, mercury and pesticides.

Besides, the process of raising, processing and freezing farm produce of Vietnam has not met European standards, making EU consumers not interested in Vietnamese products and EU food manufacturers hesitant in using Vietnamese materials for food processing.

Moreover, Vietnam does not have an effective mechanism for domestic businesses and EU businesses to work together to solve problems.

According to Yoann Perrenlt, besides adopting a dialogue mechanism between Vietnam and the EU to create transparency, special attention should be paid to the improvement of product quality.

“When the EVFTA is signed, tax barriers will be lowered, but product standards must be raised,” Perrenlt said.

China in strong demand for Vietnamese pomelos

China’s demand for green peel pomelos from the Mekong Delta province of Ben Tre and neighboring provinces has strongly increased with unlimited import volume recently.

The information was revealed yesterday afternoon by Mr. Dam Van Hung, owner of Huong Mien Tay fruit business establishment in Mo Cay Bac, Ben Tre.

According to Mr. Hung, green peel pomelo price now swings around VND55,000 a kilogram in the delta and export price is higher than that.

His establishment has sold to the Chinese market 20-40 tons on average a day, totaling 1,000 tons since early this year.

Some European countries and Canada will stop importing Vietnamese pomelos if the price exceeds VND40,000-50,000 a kilogram saying expensive. Meanwhile, China has accepted high price and kept buying. Mr. Hung commented that is a strange thing profiting Mekong Delta farmers.

Many people have been hesitated about trading with Chinese partners because they have been easy to meet with risks. Therefore, Mr. Hung said he had carefully learnt about and chosen prestigious partners. In return, he also ensures the fruit’s quality and delivers goods on schedule.

HCM City to get tax office to assist household businesses

The HCM City Department of Taxation is set to open an office dedicated to serving household businesses and newly established companies in the first week of April.

Trần Ngọc Tâm, the department’s director, told Tuổi Trẻ (Youth) newspaper, “The office will be located on the second floor of the tax department.”

It will have several TVs with tutorial clips running about things like completing the tax formalities needed to set up new businesses.

Newly registered companies will be offered free assistance for one year in areas like accounting, tax declaration and business management.

The department will set up a new website with links to websites of business groups for enterprises to send queries related to business policies.

“District-level tax offices will set up teams to answer queries from new companies,” Tâm said.

“The aim is that every household business … will get assistance from tax agencies.”

The city has 245,000 household businesses.

At a meeting with department officials earlier this month, many household businesses complained about facing difficulties in filing tax returns.

Seminar seeks solutions to boost Vietnam’s trade facilitation capacity

To ensure the implementation of the WTO’s Trade Facilitation Agreement (TFA), Vietnam needs an effective inter-agency coordination mechanism for administrative reform, experts said at a TFA seminar held in Ho Chi Minh City on March 29.

Highlighting the far-reaching impacts the FTA has on more than 100 WTO members, Director of the Vietnam General Department of Customs’ International Cooperation Department Nguyen Toan said before and after Vietnam taking part in the pact, the customs body has carried out several shakeups with sound outcomes.

However, the country has yet to fulfill its FTA commitments due to various reasons, one of which was the overload of work for the customs sector while it has limited power and personnel.

External factors, such as frequently changing requirements for supply chains, production methods, transport and trade, have also created difficulties to Vietnam’s import-export procedures, Toan added.

Au Anh Tuan, deputy director of the Supervision and Control Department at the General Department of Customs, said there is a gap between regulations and their implementation in Vietnam, noting that while the country’s legal documents and regulations are basically compatible with TFA standards but their implementation fails to match requirements. 

He attributed the problem to human causes, including limited competence and vested interest, and suggested administrative reform to facilitate trade must go hand in hand with boosting personnel capacity and balancing benefits among groups.

Sharing the same view, Pham Minh Duc, a World Bank senior economic expert, pointed to the fact that administrative procedures for granting licences, sector verification, and border trade management consume 76 percent of the total time for import-export –related work, while the time for goods examination and customs clearance accounts for only 19 percent.  

The fact means customs procedure reform alone is not enough to improve trade facilitation activities in Vietnam, he noted, adding that the involvement of both state agencies and businesses in the process is needed.

The FTA took effect on February 22, expecting to cut 14.3 percent of trade costs and increase global trade by up to 1 trillion USD each year.

Emerging market status key to netting foreign investment

Upgrading the stock market into an emerging market is one the Vietnamese Government’s key goals, with a view of attracting more foreign investment.

The US-based Morgan Stanley Capital International (MSCI) annually categorises markets across the world as developed, emerging or frontier markets, with Vietnam classified a frontier, the lowest on the ranking scale.

The Vietnam Economic Times said there are two main driving forces behind the determination made by Vietnam and other frontier markets to turn themselves into emerging ones.

First, an emerging market (EM) boasts larger scale and higher quality compared to a frontier market (FM) and embodies more growth potentials than a developed market (DM). EMs tend to attract more secure investment other than hot money often poured in FMs, while passive investment funds, like exchange-traded funds, are likely to concentrate resources on veteran EMs or newly-recognised EMs.

Second, becoming an EM means going through a major boost to the market size, liquidity and accessibility. The process will exert pressure for changes to improve legal framework and information transparency.

According to the MSCI Market Classification Framework, in order to be categorised as an EM, a country must has at least three companies fulfilling the requirements of securing 1.26 billion USD in company size (full market cap), 630 million USD in security size (float market cap), and an annualised traded value ratio of 15 percent. 

As of May 2016, Vietnam had only one company meeting these specifications. The Sai Gon Securities Incorporation (SSI) said the figure reaches four at the present time.

The EM status also requires market accessibility criteria, which include openness to foreign ownership, ease of capital inflows/outflows, efficiency of the operational framework, and stability of the institutional framework. These qualitative criteria are accessed by the MSCI once a year via its Global Market Accessibility Review. In a review announced in June 2016, the MSCI remained its classification for Vietnam, but noting some of the country’s improvements in foreign ownership in terms of announcements in English and registering process applied for foreign investors.

Overall, quantitative criteria pose minor obstacles to Vietnam, as the country has gathered enough representatives, which are likely to increase in the future.

The main barrier is qualitative criteria. Two years after ceiling ownership for foreign investors raised to 100 percent, the number of foreign shareholders remains relatively low. Capital inflows/outflows, meanwhile, are facing challenges from tightly monitored foreign exchange market in protection of the local currency.

Thanh Hoa develops animal husbandry

The central province of Thanh Hoa is taking a number of measures to develop animal husbandry for the creation of high-quality livestock products.

The provincial People’s Committee will direct the Department of Agriculture and Rural Development to push ahead with restructuring and focusing on products that are of local advantages and market demand.

It is encouraged to shift from small-scale farming households to large-scale ones, applying high technologies to ensure food safety and disease prevention.

Authorities will enable businesses to invest in the field according to the closed production chain to reduce cost and increase breeding efficiency, as well as build a planning scheme for raising poultry in an efficient, safe, and sustainable manner.

Speeding up livestock projects is also one of the crucial measures that the province will carry out to support local investors.

The locality moves to direct the Department of Agriculture and Rural Development to coordinate with the Vietnam Diary Product JSC (Vinamilk) to accelerate the construction of milk cow farms with 16,000 heads in Yen Dinh district.

Particularly, the department will shake hands with the TH True Milk company to develop a herd of 20,000 milk cows in Nhu Thanh, Nhu Xuan and Nong Cong districts, while coordinating with Thai Duong Animal Feed Company to implement a project on  building an industrial cattle-feed producing factory with a capacity of 100,000 tonnes per year, breeding 70,000 pigs, and processing farm produce in Ngoc Lac district.

Head of the department’s animal husbandry division Mai The Sang said the livestock sector grossed 5.73 trillion VND (277 million USD) in production value in 2016, a year-on-year increase of 4.1 percent. The sector made up 29 percent in the agricultural production value.

HN calls for investment in wastewater treatment projects

Hà Nội is calling for investment in wastewater treatment projects from 2016 to 2020 in a bid to protect the environment for sustainable development. 

These projects are in districts of Thanh Oai, Hoài Đức, Hà Đông and Sơn Tây. 

They will be included in the list of projects to be presented at the city’s investment promotion conference slated for June. 

With environmental protection one of the city’s key tasks in 2017, the municipal Department of Natural Resources and Environment will set up teams to co-ordinate with relevant agencies and localities in promptly dealing with problems in pollution control and environmental violations. 

The department will also call for financial resources in solving environmental issues at local industrial parks and zones, urban areas and craft villages, including building wastewater treatment stations in 50 seriously polluting craft villages. 

It will accelerate implementation of environmental projects, particularly solid waste and wastewater treatment projects in Hoài Đức District and Thanh Oai District, and a concentrated waste treatment in Chương Mỹ District.

Hà Nội has completed and put into operation wastewater treatment plants in Hoài Đức District and in the West Lake, with daily capacity of 20,000cu.m each, and started construction of a wastewater treatment facility in Yên Xá, with daily capacity of 270,000cu.m.

In the first quarter this year, the industrial solid garbage-burning station, with daily capacity of 75 tonnes, funded by Japan’s New Energy and Industrial Technology Development (NEDO) organisation, was put into operation at the Nam Sơn waste treatment area, raising the rate of hazardous industrial waste treatment to over 90 per cent.

SCIC works to improve corporate governance     

The State Capital Investment Corporation (SCIC) yesterday introduced two publications on corporate governance for the benefit of its representatives in State-owned companies.

The two publications, “Voting instruction manual” and “Corporate governance code”, were released at a workshop that aimed to improve the quality of corporate governance in companies invested in by the State. The SCIC represents the State in managing capital investments.

SCIC deputy general director Nguyen Hong Hien said at the workshop that they wanted to improve transparency and the logic of decision making processes in companies that are in SCIC’s investment portfolio.

The voting manual will help the SCIC representatives in those companies understand the firms’ reports better and improve the quality of their decision making, he said.

The corporate governance code will help SCIC and its representatives in the businesses participate in the business governance activities on more advance standards, Hien said.

Deeper participation of SCIC in the companies will improve their operation efficiency, raise the business values in the market and increase the value of the State capital in those businesses, he added.

In an attempt to link governance of the State-invested companies with international practices, the SCIC has worked with the Japan International Cooperation Agency (JICA) and global audit group PriceswaterHouse (PwC) to develop the Corporate Governance Code.

Some salient features of the new code include shareholders’ rights and equal treatment of shareholders.

Phan Duc Hieu, Deputy director of the Central Institute for Economic Management (CIEM), said the release of the manual and code shows SCIC’s determination to improve corporate governance, for itself and for the companies in its investment portfolio.

Hieu said that the two publications reflect good international practices on corporate governance based on the latest recommendations from OECD and G20 and they will be very useful if they are included in the legal policies.

Le Thi Hoai Thu, general director of the ACS Vietnam Joint Stock Company, said that the publications would be very helpful in improving the quality of corporate governance in Viet Nam.

They can improve business transparency and raise the confidence of shareholders, investors and the community in the companies’ operations, she said.

SCIC also introduced at the workshop some international practices on the corporate governance, including a financial monitoring mechanism via an internal auditing sub-unit in the business. 

Mid-end segment dominates Hanoi's apartment market in Q1

The mid-end segment dominated Hanoi’s apartment market in the first quarter of 2017.

Ms. Nguyen Hoai An, Director of Research and Consulting Services at CBRE Vietnam, told a recent press conference on Hanoi’s real estate market in the first quarter that 9,398 units were launched in 35 projects across the city.

The mid-end segment accounted for 62 per cent of total new supply, followed by high-end and affordable. New launches in the affordable segment nearly tripled compared with the fourth quarter of 2016.

The number of successful transactions reached 6,143 in the quarter, with 76 per cent being in the mid- and high-end segments.

The affordable segment saw significant improvements in supply, providing more options for homebuyers.

“Domestic investors are increasingly interested in the affordable segment,” Ms. An said. “Subsequent quarters are expected to see new supply coming to the low-end segment and most projects will be located in non-CBD areas.”

In terms of pricing, average secondary prices increased slightly in all segments. While high-end and luxury segment prices increased 8.4 per cent and 12.3 per cent year-on-year, respectively, the affordable segment saw a decline of 1.4 per cent quarter-on-quarter but an increase of 0.5 per cent year-on-year.

Mr. Marc Townsend, CEO of CBRE Vietnam, told the press conference that Vietnam is attracting major attention from investors, at the fourth-highest in Asia, after Australia, Japan and China.

Total registered capital, including new projects, additional capital, and share purchases in the first quarter reached USD7.7 billion, up 77.6 per cent over the same period last year.

Total disbursed capital was estimated at USD3.6 billion, up 2.8 per cent.

Bao Viet Insurance pays tribute to excellent counselors

Bao Viet Insurance held its Counselor Conference 2017 from March 23 to 26 to pay tribute to 150 excellent counselors in 2016, who represent a total of more than 30,000 Bao Viet counselors nationwide.

The annual tribute was held to honor the contributions and excellent achievements of counselors in bringing the Bao Viet Insurance brand closer to customers.

Officials from Bao Viet Insurance handed out 82 Golden Star prizes, 37 Platinum Stars, and five Diamond Stars to counselors with the highest insurance premium revenue in 2016. Ten team leaders of counselors with notable achievements in their localities and 23 counselors with more than 15 years of employment at Bao Viet Insurance were also honored.

On the sidelines of the event, counselors also participated in conferences to share and learn about different sales methods and handling difficult situations. This was aimed at helping them to gain knowledge and skills during the sales process.

Speaking at the event, Deputy CEO of Bao Viet Inusrance Mr. Quang Thanh Nam sincerely thanked all counselors for their outstanding efforts and contributions, which resulted in Bao Viet Insurance’s success in 2016.

While many companies saw declining growth last year, Bao Viet Insurance secured a 12 per cent growth rate against 2015. Revenue from initial insurance premiums exceeded VND6.8 trillion ($298.3 million), or nearly 20 per cent of all revenue in Vietnam’s insurance market. It’s not only the leading insurer for household customers, it is also the leading insurer for packaged insurance solutions, minimizing damage to institutional customers and companies.

On behalf of all Bao Viet Insurance officials, Mr. Nam committed to continuing to carrying out other programs to promote sales, assisting counselors in opening up the market, and taking care of customers. This is set to strengthen Bao Viet Insurance in leading the country’s insurance market.

Bao Viet Insurance was recently named the Best Place to Work in Vietnam’s non-life insurance sector for the second consecutive year. It was also in the Top 3 workplaces within the insurance sector. Rankings were based on salary levels, bonuses, welfare, and work-life balance.

Life insurance players in Vietnam made an impressive showing in 2016, with growth reaching 37 per cent, the highest in a decade. Figures from the Insurance Supervisory Authority reveal that premiums totaled around VND86 trillion ($3.8 billion) last year, representing a rise of 22.74 per cent over 2015.

In particular, total revenue for non-life insurance was VND36.4 trillion ($1.6 billion), up nearly 14.7 per cent, while revenue from life insurance was over VND49.2 trillion ($2.2 billion), up 28.4 per cent. Vietnam’s insurance industry remains dominated by Bao Viet and Prudential. Prudential leads the market in terms of total insurance premiums while Bao Viet has the strongest book of new business.

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