Short-term deposit rates forecast to reduce in 2017

The market research company Market Intello forecast that the average interest rate this year would reduce by 0.5 percentage points compared with 2016.

In the “Vietnam Macroeconomic Report - May 2017” released this week, Market Intello expected the short-term deposit rates to drop to 4.5 per cent for the three-month term and 6.3 per cent for the 12-month term due to inflation management measures of the State Bank of Việt Nam and the Government.

The research company also anticipated that exchange rates would increase by between 1 per cent and 1.5 per cent as the US Federal Reserve’s plans to raise rates twice in June and September may put pressure on the exchange rate.

In addition, the trade deficit may make the demand for US dollars rise much more than in 2016, it said, adding however, that the Vietnamese đồng will not be depressed because of the ability to control inflation below 4 per cent and abundant foreign reserves of the State Bank of Việt Nam.

Under the report, Market Intello also maintain its forecast for Việt Nam’s economic growth at 6.1 per cent in 2017.

“Agriculture is expected to recover slightly but the decline in the mining industry will impact the economic growth considerably,” it said.

Market Intello cut the CPI forecast to around 3.8 per cent, explaining that raising electricity prices could push up inflation in the third quarter, but weak domestic demand will hold inflation under the inflation target.

According to Market Intello, boosting investment from the domestic economic sector should be the biggest challenge in improving Việt Nam’s economy for the rest of the year.

“The Government has taken actions to accelerate capital disbursement from the State budget and improve the business environment for the private sector. However, until April 2017, the rate of capital disbursement from the budget was slower than the target rate,” it said.

Petrolimex enjoys huge benefits through treasury stock sale     

The Viet Nam National Petroleum Group (Petrolimex) has announced it sold all 20 million registered treasury shares at transaction value five times higher than par value.

According to the group, the shares were purchased at an average price of VND50,553 (US$2.22) each from May 4 to 23 through transactions at the HCM Stock Exchange.

Currently, Petrolimex owns more than 135 million treasury stocks.

The state-owned group has charter capital of some VND13 trillion ($571 million).

Its market value is estimated at VND73.3 trillion ($3.2 billion), ranking fifth among the largest enterprises on the Vietnamese stock market.

Petrolimex aims for year-on-year profit growth of 10 per cent this year.

Last year, the group generated some VND123.2 trillion ($5.4 trillion) in revenue and VND5.2 trillion ($229 million) in after-tax profit, up 50 per cent from 2015. 

VietReal Expo returns to Hanoi in early June

The Vietnam International Real Estate Expo (VietReal Expo) will return to Hanoi in early June, the Vietnam Association of Realtors (VARS) announced in a press conference on May 25.

The VietReal Expo 2017 will take place from June 2-4 at the National Palace for Architecture, Construction and Planning Exhibition in Do Duc Duc street, Tu Liem district.

The event will feature about 200 booths showcasing products and services of real estate firms and introducing investment opportunities, said VARS Secretary General Nguyen Van Dinh.

Several major developers are scheduled to take part in the exhibition, such as FLC Group, Hai Phat, Anphanam and Hoa Binh, Dinh noted.

On display will be a variety of real estate products, ranging from social housing projects, low-cost and middle- and high-end residential apartments to villas, land lots and resort properties, with dozens of discounts, gifts and special offers, said VARS Vice President Nguyen Chi Thanh.

A number of workshops will be held on the sidelines of the expo to exchange information and discussed different topics of the field such as project development, investment, distribution, consultation, planning and policy-related issues.

Bond demand hits seven-month high

Demand for Government bonds has hit a seven-month high, helping the State Treasury successfully issue all 5-15 year bonds worth VNĐ4 trillion (US$175.43 million) set for bidding last week.

The monetary report released by the Saigon Securities Incorporation (SSI) this week showed that the registration ratio for the auction rose 356 per cent, the highest level since October 2016. The high demand also helped the Treasury successfully call for an additional bidding of more bonds worth VNĐ1.2 trillion.

Thanks to the high demand, it was easy for the Treasury to issue the bonds at yield falling six percentage points, stopping the constantly upward trend of the yield since February.

In the week, the Bank for Social Policies also issued successfully five,10 and 15 year bonds worth VNĐ720 billion out of VNĐ1 trillion set for bidding. The 10-year bond yield fell six percentage points, while the 15-year bond yield slid 20 percentage points.

In the secondary market, rising bond demand has also helped improve liquidity significantly. Total bond value traded last week reached VNĐ42.5 trillion, or VNĐ8.5 trillion per bid on average. Foreign investors also increased their buying value from VNĐ800 billion to VNĐ1.3 trillion last week, making them become net buyers of VNĐ477 billion.

The bond yield in the secondary market continuously fell by 2-11 percentage points, of which the three-year bond yield posted the highest decrease of 11.6 percentage points, followed by the one and two-year bond yields of 11 and 6.4 percentage points, respectively.

Petrolimex enjoys huge benefits through treasury stock sale

The Vietnam National Petroleum Group (Petrolimex) has announced that it sold all 20 million registered treasury shares at transaction value five times higher than par value.

According to the group, the shares were purchased at an average price of 50,553 VND (2.22 USD) each from May 4-23 through transactions at the Ho Chi Minh Stock Exchange (HoSE)

Currently, Petrolimex owns more than 135 million treasury stocks.

The state-owned group has charter capital of approximately 13 trillion VND (571 million USD).

Its market value is estimated at 73.3 trillion VND (3.2 billion USD), ranking fifth among the biggest enterprises on the Vietnamese stock market.

Petrolimex aims for year-on-year profit growth of 10 percent this year.

Last year, the group generated approximately 123.2 trillion VND (5.4 trillion USD) in revenue and 5.2 trillion VND (229 million USD) in after-tax profit, up 50 percent from 2015.

ADB adds two more Vietnamese banks to trade finance program

The Asian Development Bank’s (ADB) Trade Finance Program (TFP) and two Vietnamese banks - An Binh Joint-Stock Bank (ABBANK) and Tien Phong Commercial Joint-Stock Bank (TPBank) on Wednesday signed agreements enabling the program to provide guarantees of up to USD50 million annually to support trade finance in Vietnam.

“Trade and trade finance are critical to the global and regional economy, in particular to small and medium-sized enterprises and job creation," said Steven Beck, ADB’s Head of Trade Finance. "Our Trade Finance Program aims to help Vietnam and Vietnamese businesses expand trade opportunities, increase competitiveness, and promote trade-led inclusive growth.”

“This cooperation with the TFP will not only bring higher business efficiency, but also create an opportunity for our bank to affirm its brand in the banking and financial market,” said Cu Anh Tuan, Chief Executive Officer of ABBANK. “The signing with the TFP marks the start of a positive development and close relationship between ADB and ABBANK in developing our banking services. We hope for ADB’s continued trust and support to further promote trade development between Vietnam and other countries.”

ABBANK is among the top ten largest commercial banks in terms of charter capital in Vietnam. ABBANK’s current charter capital exceeds VND 5,319 billion (USD234 million) and it has an extensive network of 164 transaction offices located in 34 provinces nationwide.

"Apart from the trade finance guarantee limit of USD30 million, ADB's extensive network of banks and other financial institutions will provide opportunities for TPBank to expand its global partnerships," said Nguyen Hung, Chief Executive Officer of TPBank. “The guarantee limit from ADB shall be used to support Vietnamese small and medium-sized enterprises to optimize their businesses so they can contribute to Vietnam’s economic growth."

TPBank is one of the most dynamic commercial banks in Vietnam with total assets of around VND106,000 billion (USD4.6 billion), about 4,000 employees, and an extensive network of 55 branches and transaction offices in Vietnam. TPBank has been a pioneer in setting trends in modern banking services and aims to become the leading digital bank in Vietnam. Currently, with more than 1.5 million individual customers and businesses, TPBank has been asserting its position as a strong, sustainable and healthy bank in Vietnam.

To date, TFP has supported USD8.2 billion in trade through 5,814 transactions covering both guarantees and direct funding in Vietnam. Out of TFP’s total transactions in Vietnam, 67% are related to small and medium-sized enterprises. TFP is currently working with 13 commercial banks in Vietnam.

WB endorse WBG’s Country Partnership Framework with Vietnam

The Board of Executive Directors yesterday endorsed the World Bank Group’s (WBG) new Country Partnership Framework (CPF) with Vietnam.

The CPF outlines continuous strong WBG engagement in Vietnam—accompanying the country in consolidating its development achievements and realizing the ambitious growth and development targets set.

The new partnership framework aligns with Vietnam’s 5-year Socio-Economic Development Plan for 2016-2020 and its goals of balancing economic prosperity with environmental sustainability, of promoting equity, and of strengthening the capacity and accountability of state agencies. It also accompanies Vietnam as it transitions further into middle income country status and graduates from the International Development Association - the World Bank’s fund for low income countries.

“Vietnam continues to strive for more – for higher growth, more advanced industrialization, and a better quality of life for all of its citizens. Vietnam’s growth trajectory is proof of the country’s commitment to excellence, but meeting these ambitions will require a fine-tuning of both approach and implementation,” said Ousmane Dione, the World Bank’s Country Director to Vietnam. “The World Bank Group is honored to remain at Vietnam’s side as it strengthens its position as a successful middle income country and lays out the foundations to advance to high income status.”

The new partnership framework builds on the World Bank Group’s strong engagement in Vietnam, ensures complementarity with other partners, and leverages further support to the country, through mobilizing commercial finance and private sector engagement.

Four areas are prioritized: inclusive growth and private sector participation; investment in people and knowledge; environmental sustainability and resilience; and good governance. Implementation of the CPF will involve substantial engagement at the sub-national level, the testing and application of multisector and spatial approaches and addressing as well as integrating gender aspects through analytical support, policy dialogue, lending, and strategic partnerships. 

Throughout the CPF period, the International Finance Corporation (IFC) will also leverage its investment and advisory services and mobilize long-term financing for investments that have strong socioeconomic benefits, and support the development of Vietnam’s capital markets other private finance. To help boost the country’s economic competitiveness and advance private sector development, IFC will continue to attract international investors to key sectors of finance, infrastructure, manufacturing, and energy, combining global expertise with local knowledge and leveraging investment returns and social benefits.

Through its traditional political risk insurance and credit enhancement products, the Multilateral Investment Guarantee Agency (MIGA) will complement World Bank lending and IFC engagement by mobilizing private investment and supporting commercial borrowing by the government and potentially also by State-Owned Enterprises. Wherever possible, MIGA will seek to support projects alongside other WBG entities, or in sectors where the WBG is already active.

“MIGA stands ready to play its part in delivering this ambitious WBG Country Partnership Framework for Vietnam”, said Tim Histed, MIGA Head of Southeast Asia.  “MIGA can deploy its full range of political risk and credit enhancement products in the country, and look forward to helping foreign investors bring high impact projects into the country, particularly in the renewable energy sector”.

Aligned with the new partnership framework, the World Bank Board of Directors also approved today financing for two projects totaling $358 million for Vietnam.

A $240 million (IDA) Scaling Up Urban Upgrading Project (SUUP) will improve infrastructure and urban planning in the Mekong delta provinces of Bac Lieu, Ben Tre, Long Xuyen, Soc Trang, Tan An, Can Tho and Vinh Long. About 500,000 urban dwellers will directly benefit from the investment, and a further one million people are estimated to indirectly benefit from investments under the project through extended infrastructure networks and environmental improvements.

A $118 million (IDA) Vietnam Emergency Natural Disaster Reconstruction Project (VENDRP) will reconstruct and rehabilitate infrastructure assets in the central provinces of Binh Dinh, Phu Yen, Quang Ngai, Ninh Thuan and Ha Tinh, which were severely affected by prolonged flooding in 2016. The project will help with the restoration and improvement of damaged roads, bridges, irrigation systems, rural water supply systems and natural disaster prevention/control structures. The project will also provide capacity building for officials working on disaster management. The project will directly benefit over 1.2 million inhabitants and indirectly around 5.1 million people in the five affected provinces.

Vietnam-Japan two-way trade revenue on the rise

Japan continues to be a large trade partner of Vietnam with total import-export revenue between the two sides at US$10.1 billion in the first four months of this year, up 16% over the same period in 2016.

Of the total, Vietnam posted export revenue at US$5.061 billion, up 16.9% and an import revenue at US$5.062 billion, up 15.1% over the same period last year, according to the Ministry of Industry and Trade (MoIT).

The General Department of Vietnam Customs reported that the total import-export revenue between Vietnam and Japan reached US$29.6 billion in 2016, an increase of 4% over 2015.

Of which, Vietnam exported US$14.6 billion worth of goods to Japan, a rise of 3.9% compared to 2015 and imported US$15 billion worth of goods from Japan, a rise of 4.7% over 2015.

Vietnam now has two large free trade agreements with Japan including the ASEAN-Japan Comprehensive Economic Partnership Agreement (AJCEP) effective since 2010 and the Vietnam-Japan Economic Partnership Agreement (VJEPA) effective since 2009.

Under the two agreements, the two sides pledged to cut thousands of tax lines by 2025 to facilitate and promote bilateral import and export activities.

The MoIT said that Vietnam only takes advantage of 35% of incentives offered by AJCEP and VJEPA which is a result of the strict regulations on certificate of origin of goods, particularly the regulations on the origin of garment and textile products.

However, some types of commodities make good use of preferential treatment in the two agreement including vegetables and fruits (80.4%), seafood (66.7%), plastic and plastic products (85%), and footwear (81.8%).

MoIT Deputy Minister Do Thang Hai said that despite not making full use of advantages facilitated by agreement incentives, Japan is still the most favourable market in terms of origin verification of Vietnamese goods to offer preferential tariffs.

Many public service units remain dependent on State finances

Thousands of public service units in Hanoi City still rely on State financial support though they are permitted to be financially independent, heard a working session between Deputy Prime Minister Vuong Dinh Hue and city authorities last week.

The city’s vice chairman Nguyen Doan Toan said the city had since last year allowed over 2,500 non-business public units to be financially self-reliant. However, none of them have been able to be self-sufficient; they have still sought State money to cover their regular and investment expenses.

Their revenues are enough to cover a mere 40% of their regular expenses while the rest is still sourced from the State budget.

More than 1,300 organizations could partly fund their expenditures while only 70 others could cover their frequent expenses. Nearly 145,900 people are working in these agencies in the city.

This means the Government still spends huge amounts of money on schools, hospitals and art troupes among others, though the State budget is overstretched.

Deputy Prime Minister Hue said public service units in Hanoi have a low level of financial autonomy. Therefore, he asked the city to review the situation.

He stressed if these agencies are still financially dependent on the State, they would have no appetite to cut their headcount and improve the quality of their services.

The restructuring of public services organizations is aimed at relieving the State of budget constraints caused by big subsidies for these entities.

Some units of the Ministry of Transport have gone public but the equitization program has been brought to a halt. Other units of the ministry have been converted into financially self-sufficient entities.

Sense City shopping mall opened in Ca Mau

The Saigon Union of Trading Co-operatives (Saigon Co.op), Saigon Co.op Investment Development JSC (SCID) and Hoang Tam Real-Estate Trading Co Ltd have begun operating Sense City Ca Mau shopping mall in the nation’s southernmost province of Ca Mau.

This is the third such shopping mall the Mekong Delta after the first two in Can Tho and Ben Tre provinces.

The investors spent over VND270 billion (US$11.88 million) developing Sense City Ca Mau where customers can find a wide range of goods and services, said Nguyen Thi Tranh, deputy general director of Saigon Co.op.

The three-floor Sense City Ca Mau, which includes Co.opmart Ca Mau and covers more than 18,000 square meters, stocks more than 30,000 products.

The ground and first floors house fashion, cosmetics, jewelry, telecom and health care stores, and restaurants. On the second floor, a 1,700-square-meter Galaxy cineplex with six 2D and 3D studios.

To celebrate its inauguration, the mall is offering discounts of up to 50% on fashion, cosmetics and jewelry items.

HCMC has 400 household businesses upgraded into firms

There have been 413 household businesses upgraded into firms in HCMC this year as the city has been trying to persuade household business owners to register as companies.

A report on the city’s economic performance showed January-May has seen 15,500 enterprises in the city receiving business registration certificates with total registered capital of VND193.8 trillion (about US$8.53 billion), up 10.4% and 54.2% respectively.

Meanwhile, fresh foreign direct investment approvals, including for mergers and acquisitions (M&A), in the first five months of 2017 in the city have shot up 46% against the same period last year to US$1.37 billion.

South Korea is the city’s biggest foreign investor with total investment pledges of US$95.11 million, 27.8% of the total, followed by Malaysia with US$45.07 million (13.2%), Singapore with US$39.91 million (11.7%) and Japan with US$38.9 million (11.4%).

The city government said that in the coming months, the city will continue fostering the startup ecosystem and support the upgrade of household businesses to companies.

The city looks to have 60,000 enterprises newly registered this year and the total number of firms in the city will rise to half a million by 2020. The total number of active firms here at the moment is around 300,000.

A recent report of the HCMC Tax Department showed the city has more than 36,472 household businesses eligible for upgrade to firms. The city expects 21,000 of them to become firms this year.

Once upgraded to firms, household businesses will have the opportunity to expand operations, promote brands, and gain easier access to bank loans and other benefits. In case of losses, they will be exempted from corporate income tax and can carry forward losses to the following years.

Number of new businesses increases in VN

Nearly 11,000 new enterprises were established in the country in May with total registered capital of 119.24 trillion VND (5.24 billion USD).

This was a rise of 9.3 percent in the number of enterprises and 17.8 percent in the registered capital compared to the same period last year.

On average, the registered capital of individual businesses increased by 7.9 percent to 10.9 billion VND, according to the Ministry of Planning and Investment’s National Enterprise Information and Registration System.

Totally, in the first five months of this year, the country had 50,534 newly-established enterprises with total capital of 485.6 trillion VND, a year-on-year rise of 12.9 percent in the number of enterprises and of 39 percent in the registered capital.

The five-month increase, however, was lower than that of the same period last year with 24.1 percent rise and 59.3 percent growth in term of enterprise quantity and level of capital, respectively.

Notably, the number of registered labourers for new businesses in the reviewed period saw a modest decline of 2 percent to 521,700, the system reported.

From January to May, the number of newly-established enterprises surged 72.8 percent in property trading sector; 38.9 percent in banking, finance and insurance; 31 percent in education and training sector; 27.3 percent in health-care and social support activities; and 18.4 percent in the sector of accommodation and catering services, in addition to 12.6 percent in construction industry and 11.7 percent in manufacturing and processing industry.

The five-month period also saw some 32,145 enterprises suspending operations, surging 12.5 percent year-on-year while 4,685 enterprises were dissolved in the period, which was 1 percent higher than last year’s corresponding period.

NAPAS chairman becomes head of SBV payment department     

Pham Tien Dung, chairman of the National Payment Corporation of Viet Nam (NAPAS), was appointed head of the State Bank of Viet Nam (SBV)’s payment department on Thursday.

Speaking at the appointment ceremony in Ha Noi on Wednesday, Nguyen Kim Anh, deputy governor of SBV, said payment was one of three key tasks of the central bank, along with policies, and inspection and supervision.

In the past year, the central bank had paid attention to these tasks, including payment, leading to positive results, Anh said.

On April 26, SBV governor Le Minh Hung decided to relieve Bui Quang Tien as head of the payment department to assume his new role on the Bank for Investment and Development of Viet Nam (BIDV)’s management board as a representative of 30 per cent of State-owned capital at the bank from May 1. 

PM asks for clarification on increasing sand prices     

Prime Minister Nguyen Xuan Phuc has ordered to clarify information on increasing construction sand prices in Nguoi Lao Dong (Labourers) newspaper on May 21.

Under the document, issued by the Government Office on Wednesday, the PM assigned Minister of Construction Pham Hong Ha to report the issue and propose urgent solutions.

On May 21, Nguoi Lao Dong newspaper posted a story titled "After a month, construction sand prices increased three times".

According to the article, sand prices soared over the past few days at construction material shops in HCM City. After one month, construction sand prices tripled and there was a 30 to 40 per cent shortage in the quantity of sand supplied for construction projects in HCM City. 

MoF outlines Gov’t loan re-lending

The Ministry of Finance on Wednesday held a press conference to provide information about newly-issued Decree No. 52/2017/NĐ-CP on re-lending of Government’s foreign capital loans to centrally-run city and province People’s Committees.

The decree, which takes effect on June 15, 2017, specifies the conditions for provincial People’s Committee’s to re-borrow Government foreign capital loans including Official Development Assistance (ODA) loans and other preferential loans.

Nguyễn Xuân Thảo, deputy head of the Debt Management and External Finance Department under the Ministry of Finance (MoF), said the amount and level of committed foreign preferential loans to Việt Nam had decreased significantly since 2010 when Việt Nam was upgraded to a middle-income economy.

From July 2017, Việt Nam no longer has access to World Bank ODA loans, and then other development partners, so the country will have to switch to other preferential loans and finally commercial loans in accordance with market conditions, Thảo said.

On the other hand, the allocation mechanism has revealed shortcomings which preclude equal support of the Government to localities and effective use of Government foreign capital loans, Thảo added.

Lent capital to provincial People’s Committees accounted for 35 per cent, equivalent to US$15.5 billion, of the total $45 billion worth of committed ODA and preferential loans during 2004-15. Of this number, the proportion of allocated funds was 92.2 per cent while the re-lending rate was only 7.8 per cent.

This situation was attributable to the socio-economic features of the past when provinces had great capital demand for development and poverty reduction projects.

Average lending interest rate during this period was low at about 1 per cent for a 40-year term.

The 2015 Law on State Budget, effective from the 2017 budget year, stipulates borrowing conditions for local administrations with regulations on overspending and debt limits.

Decree 52 was designed to increase local authorities’ shares of the Government’s financial burden and promote management of local administrations and effective use of Government foreign loans.

Thảo said this is an instrument to allocate capital resources, prioritising the use of ODA loans to localities having difficulties and improving debt management of local authorities to prepare for the future when Việt Nam no longer has access to ODA and has to borrow commercially.

The decree will mainly affect the budgeting levels among agencies but have no impact on the public debt level, Thảo said.

The re-lending of Government foreign capital loans to local administrations must comply with regulations of Decree 52 and relevant laws. Re-lent capital must be fully repaid on time.

When applying for projects using ODA and preferential funds, provincial People’s Committees must specify their financial mechanism, re-lending ratio, project efficiency and debt repayment capability. The re-lending must be transparent and suitable with local financial capacity.

The re-lending ratio of ODA for socio-economic development projects will be determined on the condition of lending condition of capital sources (ODA and preferential loans).

CII’s bonds aims for big

The HCM Infrastructure Investment Joint Stock Company (sticker CII on the HCM Stock Exchange) signed a contract to issue US$20 million worth of convertible bonds with the Industrial Bank of Korea.

The bonds were set with a one-per-cent interest rate per year and a conversion price of VNĐ38,500 per share ($1.61).

By issuing $20 million of convertible bonds, coupled with another $40 million issued earlier in January 2017, CII has allowed their investors to convert all $60 million in bond value into CII stocks.

This means all CII’s 33.5 million shares on the market can be sold at the conversion price of VNĐ38,500 per share, and the company can make a surplus of VNĐ540 billion ($22.6 million) for their current shareholders.

According to existing regulations, the aforementioned surplus can not be used as dividends to shareholders, though CII’s board of directors can decide on how the money is to be spent.

According to CII’s CEO Lê Quốc Bình, the company sold 2.21 million shares between May 24 and 29, 2017, raking in over VNĐ90 billion ($3.76 million). CII’s stocks have risen from VNĐ25,000 last year to around VNĐ40,000 ($1.04 to $1.67) per share in the end of May.

Bình also said that the purpose of these transactions was to pay off bank debts, contribute to CII’s investment in other companies and purchase shares from CII Engineering and Construction (CII E&C).

Binh Duong calls for French investors

The southern province of Binh Duong held a workshop on June 1 in Paris, France to promote investment opportunities to French businesses.

Speaking at the event, Vietnamese Ambassador to France Nguyen Ngoc Son praised the workshop, saying it was an opportunity to introduce the business and investment environment of Vietnam and Binh Duong in particular.

France is one of Vietnam’s leading trade partners in Europe, he noted.

The two countries bilateral trade hit 4 billion USD in 2016, the ambassador said, adding more than 300 French enterprises poured total capital of 3.4 billion USD in Vietnam. 

Projects from 35 French firms have been implemented in Binh Duong province so far, said Marianne Sasserant, Director of International Department, the Paris Ile-de-France Chamber of Commerce & Industry.

Vice Chairman of the Binh Duong People’s Committee Mai Hung Dung said his province is one of Vietnam’s leading localities in attracting foreign direct investment. 

To date, the province has lured 2,992 foreign-invested projects with total capital of 27.3 billion USD from 59 countries and territories, he added. 

According to him, high-technology, supporting industry, IT, manufacturing mechanic and manpower development, among others are sectors that want investment. 

He affirmed Binh Duong will create the best conditions for foreign investors, especially those from France. 

During the workshop, representatives also discussed their experience in investment in the Southeast Asian country to ensure benefits for both French investors and Vietnamese partners.

Dong Nai earns 1.8 bln USD from exports to US

The southern province of Dong Nai shipped goods worth nearly 1.8 billion USD to the US in the first five months of 2017, according to the provincial Department of Industry and Trade.

With the figure, the US is a main trade partner of the province, accounting for 30 percent of total export turnover.

Footwear topped the key hard currency earners in the market with over 500 million USD, followed by wooden and garment commodities (300 million USD). 

Agricultural goods such as cashew nuts, coffee and peppers were also sold to the US.

Since the beginning of the year, transport machines and tools, iron and steel as well as handbags found way to enter the US, grossing over 200 million USD. 

In the reviewed time, Dong Nai raked in 6.6 billion USD from exports.

It imported more than 6 billion USD worth of goods, including 1.2 billion USD from China and over 1 billion from the Republic of Korea.

The local Department of Industry and Trade said the province should look for new partners, boosting exports to developing countries to achieve trade balance and avoid relying on one market.

Businesses are suggested to limit imports and use domestically-produced goods instead to reduce production costs and enhance products’ competitiveness.

More social activities for impoverished kids

Used toys and books will be cleaned carefully by volunteers before being given to impoverished children in the city.

Several charity programmes have opened in Ho Chi Minh City to share joy and happiness for every child during the festival..

Arts and entertainment programmes designed for children will be held citywide, rewarding good students in difficult situations.

Smiles of little kids are a joy for their parents, helping to nurture the country’s young generation.

In big cities like Ho Chi Minh City, there remain many children living under the poverty line, so meaningful activities during special occasions, including International Children’s Day, are driving forces, encouraging children to better themselves, towards a safe, healthy and happy life.

Int’l retail, franchise show draws 270 businesses

The ninth Vietnam International Retail and Franchise Show (VIETRF 2017) kicked off at the Saigon Exhibition and Convention Centre of Ho Chi Minh City on June 1.

Nearly 270 businesses from 14 countries and territories worldwide are participating in the event, which is jointly held by the Association of Vietnam Retailers, the Korea International Trade Association of the Republic of Korea and Coex Vietnam.

Besides the display of products, equipment and technology at more than 300 booths, the exhibition also features several conferences, trade programmes and the final round of a start-ups contest.

The VIETRF 2017 is viewed as a destination for businesses to seek suitable investment opportunities through franchise.

Franchise has been growing fast in Vietnam’s retail sector over the years, especially in coffee chains, restaurants and fashion shops. It is expanded to other areas such as education-training, beauty services and consultancy. 

Many foreign companies are looking for franchise partners in Vietnam at the exhibition.

Comprehensive financial system crucial to sustainable development

A national strategy on an inclusive financial system is needed to promote socio-economic sustainable development in Vietnam, Minister of Labour, Invalids and Social Affairs Dao Ngoc Dung has said.

He made the statement at a working session with Queen of the Netherland Maxima Zorreguieta Cerruti, who is also the UN Secretary-General’s Special Advocate for Inclusive Finance for Development, in Hanoi on June 1.

He said Vietnam has gained significant achievements in poverty reduction thanks to the implementation of policies on social welfares, micro-financial development, and rural-agricultural credits.

However, a remarkable proportion of locals have yet been able to gain official access to financial and banking services, especially those in remote areas, he noted.

Dung said his ministry will chair a high-level policy dialogue on women and economy in the central province of Thua Thien-Hue in September as part of the APEC Year 2017.

He invited the Queen to participate in the event, which will make valuable contributions to the country’s efforts in narrowing the gender gap in the digital world.

Queen Maxima congratulated Vietnam on its accomplishments in poverty reduction and socio-economic development over the past 30 years.

She agreed that the building of a national strategy on inclusive finance is important to boost the country’s sustainable development.

In the context of globalization and international integration, the United Nation has been interested in promoting the implementation of inclusive financial policies in member nations to ensure vulnerable groups will receive support to overcome financial difficulties, she added.

The Queen said she is willing to share experience and cooperate with Vietnam in this field.

VietJet Air increases flights on international routes

The low-cost carrier VietJet Air will increase flights on international routes to meet the increasing demand from its customers, VietJet Aviation Joint Stock Company announced on June 1.

Accordingly, the carrier will increase flight frequency on Hanoi-Taipei (Taiwan) to 11 return flights from seven per week from July 21. Additional flights will be on route connecting Hanoi and Seoul (the Republic of Korea), which will have 14 round trips per week from August 2.

In addition, one million super promotional air fares from will be on offer on June 2. The tickets with price starting from zero VND will be available for domestic flights departing between July 1 and December 31 (except holidays).

Airfares are available on website www.vietjetair.com (also compatible with smartphone at https://m.vietjetair.com) or at www.facebook.com/vietjetvietnam (just click the “Book now” tab).

Payment can be made with Visa, MasterCard, JCB, American Express and ATM cards issued by 29 Vietnamese banks that have registered with internet banking.

Vietjet is the first airline in Vietnam to operate as a new-age airline with low-cost and diversified services to meet customers’ demands. 

Currently, the airline boasts a fleet of 45 aircraft, including A320s and A321s, and operates 350 flights each day. It has already opened 63 routes in Vietnam and across the region to international destinations such as Thailand, Singapore, the Republic of Korea, Taiwan, Malaysia, China and Myanmar. It has carried nearly 35 million passengers to date.

Vietnamese spend US$872mn on smartphones in Q1 2017

Ten out of every one thousand smartphones sold worldwide in the first quarter of 2017 were to Vietnamese users, who collective spent nearly VND20 trillion on the hi-tech devices, two separate reports show.

Vietnamese consumers collectively bought 3.6 million smartphones in the first three months of the year, compared to the global shipment of 347.4 million units, according to the International Data Corporation’s Worldwide Quarterly Mobile Phone Tracker.

In the Jan-Mar period, people in the Southeast Asian country spent a combined VND19.8 trillion (US$872.25 million) buying the handsets, according to a separate report by GfK.

In the first quarter of last year, Vietnam’s smartphone shipment reached 3.47 million units, worth a total of VND17.8 trillion (US$784.14 million).

As a new ‘tradition’, the Vietnamese tend to buy new smartphones to celebrate Tet, or the Lunar New Year that begins late January or early February, with purchases cooling down the following months.

The Gfk report points out that most Vietnamese consumers still prefer the entry-level, affordable handsets – those that cost between VND2 million (US$88) and VND3 million (US$130). Coming next on the best-seller tally are those in the price ranges of VND4.5 million (US$200) - VND6 million (US$265) and VND6 million - VND10 million (US$440).

More than 90 percent of smartphone shipments in Vietnam in Q1/2017 are Android devices, with the iPhone accounting for only eight percent of the share.

On the global scale, the 347.4 million milestone represents a 4.3% year-on-year rise, according to IDC.

Samsung remained the market leader with 79.2 million devices sold, followed by Apple with 51.6 million iPhones and China’s Huawei, 34.2 million handsets.

US Company to open laundromats in Vietnam

The US-based Alliance Laundry Systems plans to launch hundreds of self-service laundromats in major cities of Vietnam in the next five years, beginning from July, said Michael Schoeb, President and CEO at Alliance Laundry Systems.

Alliance Laundry inaugurated its first representative office at Sala Urban Residential Area in Ho Chi Minh on May 30.

Mr.Schoeb said Vietnam is the first country in Southeast Asia that the company opened its rep.office. With more than 93 million people and the middle class growth of 10% annually, the country is a potential market for Alliance to invest in.

This year, the company will open a chain of 7 Speed Queenlaundries in Ho Chi Minh City and want to increase the figure to 250 by 2020 in major cities and provinces across the country like Hanoi, Danang and Can Tho.

In the initial period, the company will operate the laundromats by itself and do not give franchise.

The company’s representative said it will focus on the quality of services and profits brought about by each laundromat and then make following plans. In Vietnam, Alliance will develop laundromats under the brand Speed Queen and open shops to sell its products like commercial washers, drying tumblers and ironers weighing 6-180kg.

As the largest commercial laundry company in the world, Alliance Laundry Systems offers world-class products and services with five brands: Speed Queen®, UniMac®, Huebsch®, IPSO®, and Primus®. It has three factories in China, the Czech Republic and the US with 2,900 staff.

Operator of Vietnam’s sole oil refinery valued at US$3.2 billion ahead of IPO

Binh Son Refinery (BSR), the operator of Vietnam’s only oil refinery, was valued at VND72.88 trillion (US$3.2 billion) at the end of 2015, with the state holding a 60 percent stake, according to the Ministry of Industry and Trade.

An affiliate of national oil and gas group PetroVietnam, BSR is preparing for an initial public offering (IPO) later this year.

CEO Tran Ngoc Quyen said BSR will sell 5-6% of the company’s shares to the public in an IPO scheduled for November.

The operator of the Dung Quat Oil Refinery will allow its employees to buy a combined 0.07% stake within the year and look to attract strategic investors next year.

Chairman Nguyen Hoai Giang told Reuters in a June 1 report that Vietnam’s government had recently given permission for BSR to sell more than half of the company to either foreign or domestic strategic investors, giving a potential buyer a controlling stake.

BSR had been in talks with Japan's JX Nippon Oil & Energy Corp., South Korea's SK Energy Co and Russia's Gazprom Neft, among others, but the talks had failed to progress, he said.

Dung Quat Oil Refinery in the central province of Quang Ngai now meets around a third of Vietnam's demand for fuel and oil products with an annual capacity to process 6.5 million tons of crude oil each year.

Costing US$3 billion, the refinery posted revenue of VND21 trillion (US$923 million) in the first quarter ending March, or 33% of its full-year target.

The result paints a bright picture after BSR projected revenue this year at VND62.4 trillion, down 17% from 2016 on an expected drop in crude oil prices and shorter production time due to maintenance work.