Parking lot investors face endless rhetoric  

Though there is much rhetoric flowing from authorities in Ho Chi Minh City encouraging and pledging support to investors for constructing traffic parking lots, there is not much by way of action.
 
Over the last ten years, city authorities have twice issued regulations relating to construction of parking lots. Initially it issued a decision in 2006, calling on investors to build parking lots and later revised it in 2010 with added incentive of interest free assistance.

The Government also promulgated a decision in 2009 to exempt rent for public transport companies who would build parking areas and automobile repair stations.

Duong Hong Thanh, deputy director of the Department of Transport said that the city has only one parking lot as a consequence of these policies, but now the investor has little interest in running the parking space and wants to sell it to repay outstanding bank loans.

Nguyen Thi Dung, director of Thanh Hiep Phat Company said that she is now feeling quite harassed with the innumerable policies of the government. Her company was the first to respond to offers to develop parking lots. The project had been approved by authorities.  However, since the parking lot was built, the company has not received any assistance regarding bank interest as promised.

Authorities have also failed to carry out their promise to ban all cars from parking along road sides or compel them to move to parking lots.

The Saigon Transport Mechanical Corporation (Samco) was the main enterprise in HCMC with strong financial backing. Nevertheless, when the city asked them to build the new Mien Dong and Mien Tay bus stations, they became concerned.

According to Le Van Pha, deputy general director of the company, the 14 hectare Mien Dong Bus station is planned on an adjacent area in Binh Duong Province while the 11 hectare Mien Tay bus station will be located in Binh Chanh District in Ho Chi Minh City.

The two projects are currently in progress and even though they have the support of many authorities’, yet the company is confronting many difficulties.

Pha says his company is not directly exempt from land rent and hence has submitted a petition for the same.

Samco is also feeling obstructed with another decision of the city People’s Committee. Accordingly, the city only supports high-rise or underground parking in city centers. The two bus stations are planned to be built in suburban areas. If they are not permitted to have underground or high-rise floors, the stations will not have enough functional space which includes a parking lot, a bus station and a metro bus station.

Dong Duong Company is used to pursuing projects to build underground parking lots in the city for the last five years but now is very concerned about the land rent.

Nguyen Thi Bao Quynh, the company deputy director said that its project to build a parking under Trong Dong Theater in District 1 is still awaiting exemption from land rental.

The company plans to build a small shopping mall to serve passengers within the premises, however, authorities’ say they will be taxed as applicable to other large shopping malls.

“We are tired of such complicated procedures and regulations,” spoke a harassed Quynh.
 
Lawmakers call for firmness in inflation fight

Even the government’s revised inflation target of 17 percent for this year would be hard to achieve, some lawmakers admitted, urging the government however to remain determined in its efforts.

When Tuoi Tre asked some National Assembly members at a media briefing after the July Cabinet meeting about the inflation target, Huynh Ngoc Dang, deputy head of the Binh Duong parliamentary delegation, said with prices rising by 1.17 percent in July the government was unlikely to achieve the target.

He mentioned two adverse factors in the fight against inflation: the traditionally bad weather in the latter of the year which hits production and thus prevents prices from declining, and the lack of impact so far from the government’s tax breaks and credit support for small and medium-sized firms.

He urged the government to subsidize essential goods for poor people and continue to tighten credit, especially to the property sector.

Tran Ngoc Vinh, deputy head of the Hai Phong National Assembly delegation, also said prices would continue to rise in the second half and urged the government to stay firm in its anti-inflationary course.

Petrol and power prices also need to be stabilized to prevent prices from soaring, he added.

Nguyen Thi Nguyet Huong, CEO of the Vietnam Investment and Development Group, was concerned over public spending.

She said the planned cuts in investment in ineffectual projects have not been handled well.

“The government should improve the efficiency of public investment to ease the inflationary pressure,” she said.

Canada warns Vietnam about antibiotic in catfish

The Canadian Food Inspection Agency is considering a ban on Vietnamese catfish products after finding samples with excess levels of the antibiotic enrofloxacin, the Vietnam Association of Seafood Exporters and Processors said citing sources from the Vietnam Trade Commission in Canada.

It is the first time Canada Vietnam has warned about antibiotic residues in catfish though it is the third such instance this year.

In the first week of June Japan said it found two shipments of shrimp from Vietnam containing enrofloxacin residue.

Since June 10 it has increased the frequency of inspection of Vietnamese shrimp for enrofloxacin from 30 percent to 100 percent.

German and Italian authorities also said four catfish shipments from Vietnam contained trifluralin residues and the chemical substance chlorpyriphos used to kill termites.

VASEP chairman Truong Dinh Hoe said Canada has tightened the norm for enrofloxacin residue in seafood to 0.06 parts per billion (ppb), and urged Vietnamese exporters to take note.

Seafood is Vietnam’s third largest export item to Canada while the North American country has been one of the main markets for Vietnamese seafood this year, buying more than 11,550 tons of seafood worth about $ 63.2 million to Canada in the first half, including nearly 6,900 tons of tra and basa.

In March-June this year VASEP recommended to the General Fisheries Department that it tighten control of enrofloxacin use by farmers.

But an outdated 2009 circular from the Ministry of Agriculture and Rural Development listing banned and restricted drugs, chemicals, and antibiotics has yet to be replaced.

Thus, though enrofloxacin is named in this list, its limit is indicated as 100 ppb.

Seafood companies are extremely worried since they cannot control the use of the antibiotic which remains widely used by farmers.

They are having to invest in expensive testing equipment as a result.

Last week three leading British retailers, Tesco, Asda and Morrisons, announced they had withdrew from their shelves Vietnamese catfish imported by a local company after some of the fish was found to have some illegal substances used to increase their weight.

HCMC targets 12 percent growth rate  

The Ho Chi Minh City People’s Council has asked the People’s Committee to concentrate on curbing inflation and ensuring the growth rate at 12 percent this year.  

In a recently issued resolution on socioeconomic targets for the second half of the year, the people’s council asked the city administration to promote the price stabilization program, develop infrastructure and ensure power supply for production and businesses. Flood reducing measures, environment pollution and traffic congestion should also remain points of focus.

Construction should be stepped up in new urban areas, resettlement areas, dormitories and social housing programs, which will provide accommodation for civil servants, military servicemen and workers.

People living along canal embankments should be relocated as quickly as possible. Projects related to children, such as entertainment parks and educational facilities must also be speeded up.

In related news, the HCMC Department of Transport said that this year many major traffic projects in the city are running behind schedule due to capital shortage.

Works include construction of the road leading to the National University of Ho Chi Minh City in Thu Duc District, 10 bridges on Road 9 in Cu Chi District, the Binh Thai-Go Dua road, Rach Doi Bridge, Doi Bridge and the second belt line road.

Elsewhere, sluggish site clearance procedures in some districts has affected the progress of  the Hanoi Highway, Tan Son Nhat-Binh Loi outer ring road, Do Bridge, Go Dua Bridge, Road 10 and Road 10B.
 
Acute shortage of shrimps for export  

The seafood processing business is presently facing an acute shortage of shrimps and currently operating at only 40 percent capacity in the southernmost province of Ca Mau.  

Ly Van Thuan, general secretary of Seafood Processing and Export Association in the province stated yesterday that processing plants in and outside the province were scrambling to buy more shrimps to meet export targets. Now, this acute shortage has sky-rocketed the price of shrimps by VND60, 000-70,000 a kilogram.

In related news, the Department of Agriculture and Rural Development in the province revealed that the Perkinsus parasite was the cause of the massive dead oyster culch in the province recently. Farmers have now been asked to halt breeding and wind up the present harvest.

Ca Mau Province has so far suffered 413 hectares of dead oyster culch, causing damages of VND30 billion (US$1, 4 million).
 
Money supply must increase to avoid stagflation

Vietnam's central bank should pump more money into the economy, while taking care to ensure it doesn't fuel inflation, a senior Vietnamese government advisor said.

Money supply expanded at 2.45 percent in the first six months of the year, well below the government's 16 percent annual target, which has also led to slowing credit growth in the country.

"Money supply has been too tight in the last six months. Money should be supplied equally throughout the year," Le Xuan Nghia, vice chairman of the National Financial Supervisory Committee said.

"Raising money supply doesn't mean loosening monetary policy," he said on the sidelines of a meeting on Friday.

Overly tight money supply could also reduce production of goods and therefore raise inflation, he said. "We need to avoid stagflation," Nghia said.

July's consumer price index hit 22.16 percent year on year.

"The central bank is going to accelerate anti-dollarisation measures," Nghia said, referring to the practice of making dollar loans less attractive by raising banks' foreign currency reserve ratio, increasing demand for dong loans.

By June 20, dong-denominated loans have risen by a mere 2,76 percent this year, compared with 23,47 percent growth in dollar loans, central bank data shows.

The other fallout of the faster jump in dollar loans is the pressure on the exchange rate at the time of repayment, Nghia warned.

"This could create huge demand for foreign currency at the end of the year when dollars loans are due and if dollars supply from the export market is difficult at the same time it would cause tension to build in foreign currency market," he said.

"We have been informing the government to come up with measures right now to avoid that risk."

Vietnam – Cambodia railroad to be built   

It is part of the Singapore-Kunming railroad project, so it will be a key railroad for Cambodia to transport commodities to regional and global markets, especially in the framework of ASEAN-China Free Trade Area.  

The feasibility study for the construction was implemented  by the Chinese Railway Ministry's Third Railway Survey and Design Institute since July 2009 with a cost about 3 million USD funded by China.

As planned, the railroad is 257 kilometers in length, starting in Kampong Speu Province’s Oudong district, pass by Kratie province’s Snuol district and end at Vietnam’s Loc Ninh district in the southern border province of Binh Phuoc.
 
Experts have finalized the total cost for the construction of the Vietnam – Cambodia is about 686 million USD, according to a feasibility study for the construction begining from Kampong Speu province (Cambodia) to the southern border province of Binh Phuoc (Vietnam).

However, this money is not including the settlement compensations for residents affected by the project.  

"The project will provide huge economic benefits to Cambodia, especially on the development of agriculture and mineral resources, as well as tourism sector", experts said. The study result will be submitted to Prime Minister Hun Sen to make decision.  

The railway will be part of an intra-Asian railway that runs from Singapore to China via Malaysia, Myanmar, Thailand, Laos, Cambodia and Vietnam. It is expected to be complete within 30 months.

Vietnam to train more human resource  

The Vietnamese Government has ambitious plans to train at least 30.5 million workers under its human resource development plan during the years 2011-2020.  

This plan is expected to cost over VND2 trillion (US$95 million), accounting to 12 percent of the social investment capital.

The plan aims to increase the number of trained workers from 40 percent in 2010 to 70 percent by 2020.

Amongst these, the numbers will increase from 15.5 percent to 50 percent in the agriculture sector, 78 percent to 92 percent in the industrial sector, 41 to 56 percent in the construction sector and 67 percent to 88 percent in the services sector.

The Government is also planning to raise the number of universities and colleges to 537 by 2020. Another 158 schools will also be added by 2015.
 
Taiwan carrier to fly to Da Nang

Taiwan’s Far Eastern Airlines and the Da Nang Tourism Join Stock Company will launch chartered flights to the central city next week.

In the initial phase of three to six months the carrier will operate a 180-seat Airbus to Da Nang every five days.

It will later consider flying to Siemriep in Cambodia through Da Nang.

New circular cracks down on gasoline smuggling

A new circular issued by the Ministry of Industry and Trade to curb fuel smuggling in border areas makes any transport of fuel worth more than VND200,000 (US$10) without receipts illegal.

All gas stations in border areas are required to issue receipts with buyers’ exact names and addresses.

The circular also limits the total amount of fuel they can sell to foreign customers to 50 liters per day for road vehicles and 100 liters for boats.

Besides, the petrol stations are prohibited from pumping fuel into any containers except the main fuel tank of vehicles.

Since fuel prices in Cambodia and Laos are higher than in Vietnam, there is widespread smuggling to those countries.

The circular takes effect September 15.

Honda to build 3rd motorbike factory in Vietnam

Ha Nam Province near Hanoi has licensed Honda Vietnam to set up a US$120 million motorbike factory, Koji Onishi, president of the Japanese-owned company, said.

It will be Honda’s third factory in the country and will mainly produce scooters.

Once the factory opens in the second half of 2012, Honda’s capacity will increase from 2 million bikes a year to 2.5 million.

VN boosts agriculture links with Sierra Leone

Vietnam and Sierra Leone have agreed to boost cooperation in agricultural trading and research and exchange of experts in the field.

The agreement was reached at talks in Hanoi on July 25 between Deputy Minister of Agriculture and Rural Development Nguyen Thi Xuan Thu and Sierra Leone Deputy Minister of Agriculture, Forest and Food Security Ali Mansaray.

The two sides also agreed to build a research centre for developing rice varieties in Sierra Leone with financial support from Egypt .

At the talks, Deputy Minister Thu said Vietnam sent agricultural expert Vo Tong Xuan to develop the rice research centre in Sierra Leone and will send an additional five experts to the country in August to lay the groundwork for building a cooperative programme on rice and seafood production between the two countries.

For his part, Ali Mansaray confirmed that Sierra Leone considered Vietnam as a top partner and it would create favourable conditions for Vietnamese experts, as well as receive skilled Vietnamese workers to the country.

He also said that Sierra Leone would allow Vietnam to rent land for growing rice, vegetables and industrial crops for export to European and African countries.

The country will also give priority to importing goods from Vietnam , he said.

FDI rises again in July, reaching $1b
 
Foreign direct investment rebounded in July, reaching US$1 billion for the month, the Ministry of Planning and Invest-ment's Foreign Investment Agency announced.

The figure almost kept up with the highest monthly level since the beginning of this year, which was $1.39 billion in March, the agency said.

It also broke the downward trend of FDI disbursement over past few months.

Total FDI disbursement hit $6.3 billion for the first seven months, marking a 1.6 per cent decrease over the same period of last year.

This month also witnessed a significant change in new registered investment capital. Only 49 new foreign-invested projects received licences during the month, the lowest in six months but the total registered capital for these projects was up to $3.23 billion.

Meanwhile, 15 existing projects were allowed to increase their capital by $148 million this month. So far this year 147 projects have been approved to add $1.42 of registered capital.

The new additions have brought the total FDI registered in the first seven months to $9.05 billion, down 24 per cent on the same period last year, the agency said.

During the period, Hong Kong overtook Singapore to become Viet Nam's largest source of foreign investment with 31 projects worth $2.89 billion.

Singapore ranked second with 54 projects capitalised at $1.41 billion, following by South Korea with 172 projects valued at $797 million and Japan with 119 projects worth $720 million.

The processing and manufacturing sector attracted the largest share of FDI, gobbling up $4.25 billion. Electricity, gas and water production and distribution sector contributed $2.52 billion while the construction industry made up $603 million.

With 21 projects, totally worth $2.49 billion, the northern province of Hai Duong was the country's biggest destination for foreign investors, followed by HCM City with $1.63 billion and southern Ba Ria-Vung Tau Province with $510 million.

The agency also reported foreign-invested firms fetched $27.82 billion from exports in the first seven months of the year, up 34 per cent over the same period last year. The firms also spent $25.4 billion for imports during the period, up 29.5 per cent.

Trade gap on petroleum exceeds $5 billion

Vietnam’s trade deficit on petroleum products has exceeded US$5 billion for the 1st time ever, according to the General Statistics Office (GSO).

Vietnam earned $1.128 from exporting 1.229 million tons of crude oil in the first 7 months of this year, up 68.8 percent in value and 21.3 percent in volume year on year.

But it had to spend $6.174 billion to import 6.813 million tons of refined petroleum products to meet domestic demand, up 58.5 percent in value and 8.6 percent in volume compared to same period last year.

In July alone, oil imports reached 800,000 tons worth $770 million, down 10.9 percent in volume and 5.8 percent in value month on month.

Oil exports this month was 140,000 tons worth $130 million, down significantly from 188,000 tons and $179 million in June.

Vietnamese seafood firms to export to the EU

The EU has officially certified 380 Vietnamese seafood firms to export their products to the European market, according to the Viet Nam Association of Seafood Exporters and Processors (VASEP).

The new list of certified exporters will come into effect by tomorrow, said Tran Bich Nga, deputy director of the National Agro-Forestry-Fisheries Quality Assurance Department (NAFIQAD).

Nga added that the NAFIQAD would assist enterprises in following European Commission regulations on exporting to the EU market.

The EU is currently Viet Nam's largest seafood importer, consuming roughly 30 per cent of the country's entire export seafood volume, earning Viet Nam roughly US$1 billion in revenues per year. During the first half of this year, the country earned around $634 million from the EU market, an increase of 21.7 per cent over the same period last year.

One-fifth Vietnamese population uses banking services

About 20 percent of Vietnamese population is using banking services, doubling that in 2007, Nguoi Lao Dong newspaper quoted Nguyen Duc Vinh, general director of Vietnam Technological Commercial Joint Stock Bank (Techcombank), as saying.

The whole banking system in Vietnam has provided about 30 million payment cards and tens of thousands of POS (points of sale) machines, he added.

Though the potential for retail banking service development is still bright, only basic services, such as payment cards, are widely used in Vietnam.

Of over two million individual accounts at Techcombank, about 60 percent sees frequent uses, he said.

Vietnam’s agro-forestry and seafood exports to hit US$13.9 bil

In July, Vietnam is expected to fetch US$2 billion from exporting agro-forestry and seafood products, bringing total export turnover in the first seven months to US$13.9 billion, up 33.4 percent against the same period last year, according to the Ministry of Agriculture and Rural Development (MARD).

Vietnam’s key farm exports including coffee, pepper and rubber are estimated at US$8.1 billion, up 44.6 percent.

In the reviewed period, coffee exports are expected to reach around 930,000 tonnes worth US$2 billion, up 24 percent in quantity and 92.2 percent in value from a year earlier. The average price of coffee now stands at US$2.196 per tonne.

Vietnam expects to earn US$2.3 billion from rice exports, up 9.7 percent in quantity and 10.8 percent in value. Indonesia remains to be Vietnam’s largest partner, followed by Malaysia and Cuba.  

Vietnamese businesses also set their sights on new markets such as Senegal, Bangladesh and Cote d’Ivoire.

Pepper exports are predicted at 85,000 tonnes worth US$465 million, up 70.9 percent in value against the same period last year. The export price of pepper is now US$5.393 per tonne.

In the meantime, rubber exports are put at 349,000 tonnes worth of US$1.5 billion and the average price is US$4.368 per tonne.
 
Support for SMEs key to progress
 
The application of science and technology in production is considered important to the development of small and medium sized enterprises (SMEs), according to Pham Minh Tuan from Asia Pacific Incubator Network.

Support for the development of SMEs has been emphasised as one of the key components of Viet Nam's socio-economic development strategy, he added.

With the National Programme of Technology Innovation to 2020 now ratified, SMEs are set to apply technology in their operations.

The national programme established a target to train about 80,000 SME staff members in technology management and administration by 2020.

Vice president cum general secretary of the Viet Nam Chamber of Commerce and Industry (VCCI) Pham Gia Tuc also stressed the necessity for SMEs to set up their own electronic portals in order to become competitive in world markets.

To date, there are approximately 500,000 enterprises in Viet Nam, a figure that is predicted to double by 2015. About 95 per cent of these operate on a small to medium scale.

SMEs play a significant role in the country's economic development, contributing more than 40 per cent of the GDP, according to the Association of Small and Medium Enterprises.

According to VCCI's report in 2010, the application of information technology in SMEs was still limited. Only 46 per cent of enterprises claimed to use e-mail at work and only 20 per cent had their own web sites.

More than 50 per cent said they did not use software to manage human resources, wages or sales.

At a conference with the Ministry of Science and Technology held on June 22, Peter Moors, Director General of Belgium Development Co-operation, said the business incubators had been considered the launching pad for SMEs.

According to the United Nations, a technology business incubator is a facility providing nurturing service in both pre-seed and seed stages of business development, enabling innovation and entrepreneurship.

In Viet Nam, the model of business incubators has been shaped in some universities and enterprises, including the University of Science and Technology, the University of Agriculture and Forestry, FPT Group and Sai Gon Hi-tech Business Incubator.

At the conference, the Ministry of Science and Technology assigned the Technology Application Institute to implement this model of business incubators in Ha Noi.

In HCM City, the model of business incubators has been in its pilot phase since 2007, providing support to SMEs, according to the HCM City Department of Science and Technology.

Pham Tuan Minh from CRC Incubator said the services offered by his company were comprehensive, concerning marketing, business plan development, business IT applications, accounting and legal procedures.

According to Nguyen Dinh Suc, vice president of the Ha Noi Youth Business Incubator Club, young entrepreneurs with feasible business ideas will be assisted by business incubators for 1.5 to 2 years to help them grow into fully – fledged professionals.

The likelihood of success for enterprises that had used an incubator was higher than for other enterprises, he added.

To date, there are about eight business incubators in Viet Nam. The model was created in the US in 1959 and soon developed to become popular in many countries around the world, Suc added.

Promoting economic cooperation between Vietnam and Laos

An international seminar on Vietnamese and Lao socio-economic developments in the next ten years (2011-2020) was held in Vientiane, Laos on July 25.

The seminar organised by the Vietnam National Economics University (NEC), the Lao National Social Sciences Institute and National University aims to devise measures to boost economic cooperation between Laos and Vietnam.

Participants in the seminar focused on discussing four main issues, such as macroeconomic growth model, economic restructuring of Lao key industries, FDI attraction and international economic integration and human resources development and social welfare.

Lao and Vietnamese experts analysed the socio-economic situation in each country and proposed breakthrough measures to effectively implement targets set by the two countries.

They agreed that the two countries should associate economic cooperation between the two countries with regional development, especially with ASEAN.

The seminar will send proposals for economic cooperation to the two governments.

The Vietnamese NEC will cooperate with Lao institutes and universities in specific fields.

Mekong Delta has new rice processing complex

Construction of a VND77 billion rice processing complex has started in Thoai Son district of the Mekong delta province of An Giang, aiming to reduce post harvest losses for farmers and increasing the quality of processed rice for exports.

The 2.6ha complex, built by the An Giang Import Export Company, comprises a warehouse system which can accommodates 28,000-30,000 tonnes of paddy rice and a drying system which can process 600 tonnes of paddy rice per day.

According to the Vietnam Food Association (VFA), so far this month, Vietnam has exported almost 400,000 tonnes of rice for more than US$185 million, bringing the country’s total rice exports in more than six months to 4.3 million tonnes worth US$2 billion.

Asia remains a major importer, making up 54 percent of Vietnam’s total rice exports, followed by Africa with 31 percent and America, 12.2 percent, said the VFA.

Vietnam expands electricity equipment investment in Cambodia

The Vietnam Electrical Equipment Corporation began construction of a transformer factory in the Phnom Penh Special Economic Zone in Cambodia on July 25.

Covering an area of two hectares, the factory has a total investment capital of US$2.5 million. After completion, it will produce about 4,000 transformers every year.

Addressing the event, Nguyen Van Cuong, CEO of the corporation, said this construction is the corporation’s first investment project in a foreign country and it expects to build good neighbourly relations, friendship, solidarity and contribute to long-term, sustainable and comprehensive cooperation between Vietnam and Cambodia.

The factory is scheduled to be put into operation later this year and employ about 150 technical workers, half of whom will be Cambodians.     

134 tourism businesses win the 12th Guide Award

More than 400 representatives from hotels, resorts, restaurants and travel agents from across the country will gather at the 12th Guide Awards themed “Tourism Vietnam: Friendly Hospitality” in Mui Ne, Phan Thiet on July 29.

134 hotels, resorts, restaurants, healthcare services, travel agents, transportation, shops and other services will be honoured at the event.

Some businesses that have won awards for several consecutive years include the Sofitel Legend Metropole Hanoi (12 years in a row), the Melia Hanoi Hotel and Buffalo Tours (11 years), Six Senses Con Dao, Cham Villa Phan Thiet, and Fusion Maia Da Nang.

Criteria for the awards are based on infrastructure, the quality of services, environmental friendliness, and other values.

Readers of the Guide, Vietnam’s leading tourist magazine, voted to decide which business will win the awards.

Thailand welcome more MICE

Thailand is expected to welcome 720,000 MICE (meeting, incentives, conventions, exhibitions) visitors this year, generating roughly US$1.9 billion in revenue.

At the Connections Plus 2011 Programme last week, the yearly event during which Thailand hosted key buyers, corporate clientele and members of media, the Thailand Convention and Exhibition Bureau announced Hua Hin as one of the five carefully selected luxury destinations, in its latest MICE marketing initiative, especially designed for an untapped niche market.

Akapol Sorasuchart, TCEB president, said "Thailand's MICE industry had offered endless possibilities and inspired success for both business and leisure travellers for a long time. In 2011, the country turned another page in its service history by lifting its status and moving into the luxury destinations category.

"This shift was due to an adjustment in global trends. In 2011, the global meetings industry will see a gradual shift to high-end meetings. Thailand is in the position to offer luxurious destinations and services for a reasonable and competitive price."

Despite the global financial crisis and domestic political situation, Thailand has outshone competitors with its leadership position as ASEAN's top trade fair destination for five consecutive years, according to market research conducted by UFI (the Global Association of the Exhibition Industry) in 2010.

Situated on the west coast of the Gulf of Thailand and about 200km south of Bangkok, Hua Hin embodies its status as one of the country's favorite beachside destinations by royalty and members of the Thai elite, as well as offering good infrastructure and accommodation.

Hua Hin, among other selected cities including Bangkok, Chiang Mai, Phuket and Samui, promises to provide a truly captivating experience, high standards and unspoiled natural landscapes, he said.

"We are confident that this brand new initiative will help us to achieve our targets for 2011 and exceed the LUXURY MICE expectations of all our visitors. This campaign also reflects our commitment to further the Thai MICE industry as a whole and to leverage our capacity to meet international demands, and to promote ASEAN as the world's most preferred MICE destination," Akapol added.

Viet Nam is one of Thailand's potential MICE markets, he said, adding that they hoped that the East-West Economic Corridor linking Viet Nam, Laos, Thailand and Myanmar will bring more visitors from Viet Nam to Thailand, especially for meetings and incentives.

"Viet Nam is the gateway to southern China and the Greater Mekong Sub-region, our main focus," he said.

Currently, many Thai investors are investing in Viet Nam. Despite the political unrest in Thailand, bilateral trade has increased strongly in the past years, from $6.06 billion in 2009 to $7.24 billion last year. The figure is expected to reach $10 billion this year.

International seminar discusses regional economic integration

Senior officials and delegates from Cambodia, Laos, Myanmar and Viet Nam shared their experiences in devising and implementing international economic integration policies to serve their countries' sustainable development at a seminar in Ha Noi.

At the meeting yesterday, participants agreed that their countries should co-operate in sub-regional, regional and inter-regional frameworks. This would make the best use of opportunities and minimise challenges from international economic integration.

Viet Nam's Deputy Foreign Minister Doan Xuan Hung suggested the four countries continue to actively take part in international economic integration and closely co-ordinate to build the ASEAN community.

In his speech, former Deputy Prime Minister Vu Khoan said that the four countries should regionally co-operate and connect to best maintain sovereignty and legitimate rights in other countries.

Asian Development Bank Country Director, Tomoyumi Kimura spoke highly of prospects for cooperations in the Greater Mekong Sub-region (GMS), saying that 55 projects worth US$14 billion were carried out in the GMS framework. He affirmed that the ADB would continue its cooperation with the four countries and assist existing sub-regional cooperation mechanisms to help them in their international economic integration and sustainable development.

The seminar is part of a cooperation project between the Vietnamese Ministry of Foreign Affairs and Germany's Hanns Seidel Foundation to help Viet Nam and regional countries in international economic integration.

VNAT, Vietnam Airlines want Japan tourists back

The Vietnam National Administration of Tourism (VNAT) and Vietnam Airlines on Sunday began a five-day fact-finding trip to Japan to explore ways to lure Japanese tourists back after the natural disasters in March, an official said.

Hoang Thi Diep, deputy head of VNAT, told the Daily that representatives would meet Japanese travel firms and tourism officials for talks after a huge decrease in the number of tourists from Japan visiting Vietnam.

“We saw a huge decline in the aftermath of the natural disasters of the number of Japanese visitors to the country, that’s why we need to explore new ways to recover that market,” she said.

Japan is the third largest market for tourism in the country. The nation has received more than 235,000 Japanese visitors in the first half of this year, up 11.7% year-on-year.

APEX Travel Co., who represents a number of companies serving Japanese tourists, has requested VNAT ask the Vietnamese authorities to allow Japanese tourists to stay for up to 30 or 60 days without an entry visa, instead of the current 15 days.

Nguyen Van Tran, general director of APEX, said that the company is still waiting for a response. “Our tour prices have been down by 3% to 5% in recent times.” He said things seem to be picking up.
 
Resort project breaks ground in Da Nang

Thanh Do Construction and Investment JSC started construction on the Empire Residences and Resort on Sunday.

With an investment of VND10 trillion (US$476 million), the project occupies 51ha on the coast of Ngu Hanh Son District, central Da Nang City.

The resort will contain five-star hotels, health care centres, restaurants, commercial and sports areas, and villas.

Import costs make drug prices soar

The prices of imported and domestic medicines have risen slightly this month, according to the Viet Nam Pharmaceutical Companies Association.

Among the nearly 4,200 drugs surveyed in Ha Noi, 97 drugs saw price hikes of 6.2 per cent on average, and 19 saw a 4.4 per cent decrease, accounting for 2.3 per cent and 0.4 per cent of total surveyed drugs, respectively. Drug prices remained stable in Da Nang and HCM City.

The association forecasts higher sales prices for both Vietnamese and imported medicines next month due to higher input costs and rising world prices.

Building project resumes after check

Construction of the Hesco building project in Van Quan Ward of Ha Dong District has been allowed to continue by the Ha Noi People's Committee, after being postponed for planning scrutiny.

The project includes a trade centre, as well as office and apartment buildings to be built on an area of 21,294sq.m.

The work, which is the joint venture of Irrigation Equipment JSC and the Megastar Real Property JSC (Megastar Land), is expected to be complete by late 2014.

Mekong Delta to raise its economic profile

An economic co-operation forum will be organised in October to help raise the profile of the Cuu Long (Mekong) Delta and attract more investment to the region.

The fourth annual Cuu Long (Mekong) Delta Economic Co-operation (MDEC) – Ca Mau event, to be held in southernmost Ca Mau Province, will build links among Delta provinces and local and international organisations in an aim to improve the socio-economic development of the area.

The event is being held over a seven-month period in Germany, Taiwan, HCM City and Ca Mau Province.

India-Vietnam venture starts building carbon plant

Phillips Carbon Black Vietnam JSC on Friday started work on the nation’s first carbon black plant in the southern province of Ba Ria-Vung Tau.

The plant is a joint venture between Phillip Carbon Black Ltd of India and three Vietnam National Chemical Group (Vinachem) rubber affiliates –Casumina, Da Nang and Sao Vang. Phillips Carbon Black holds a stake of nearly 80%.

The plant, covering 14 hectares at My Xuan A Industrial Zone in Tan Thanh District and costing US$84 million, will be executed in two phases with the first phase expected to go into operation late next year.

The plant’s first phase will have a capacity of 60,000 tons of black carbon a year to meet the needs of the automobile tire, ink and additives industries. In the second phase, the capacity will be scaled up to 115,000 tons.

Around 40% of carbon black output of Phillips Carbon Black Vietnam will be exported and the balance will be for the domestic market, the joint venture said in a statement. Phillips Carbon Black Vietnam JSC was granted an investment certificate by Ba Ria-Vung Tau Industrial Zones Authority (BIZA) in March 2010.

Phillips Carbon Black Limited (PCBL), part of the RPG Group, is the largest producer of carbon black in India.

Da Nang has too many empty offices
 
An excess of office space supply over demand has resulted in low occupancy rates among the B and C market segments in central Da Nang City, real estate consultants say.

A second quarter report by CB Richard Ellis (CBRE) puts average occupancy rate for all three grades, A, B and C, at around 69 per cent.

With no new grade A property entering the market in the first half of this year, the Indochina Riverside Tower is the sole occupier of this market segment in Da Nang. The tower has a modest office space of over 6,000sq.m and its occupancy is high at 84 per cent.

In the B grade segment, the existing six properties have had no new competitor emerge, so they have enjoyed average occupancy rates of almost 72 per cent.

Tenants had, by the end of the first six months, taken up 63 per cent of grade C space, which represent less than a half of the city's total office area.

Two new buildings entered the market during this period, offering an additional 1,500sq.m.

The CBRE report found occupancy rates posted quarter-on-quarter (q-o-q) increases of 11, 15.6 and 3 per cent for grades A, B and C respectively. Average monthly asking rent was US$11.31 per square meter, a decrease of 0.8 per cent over the previous quarter. There were no q-o-q changes in grade A, but a small fall of 0.24 and 0.16 per cent respectively for grades B and C.

The asking price for grade A was $19 per square metre and over $13 and $10 for B and C respectively. This compared to corresponding rates of over $34, almost $19 and $15.7 in HCM City.

Cushman&Wakefield, another property service provider, said that office space availability in Da Nang was estimated to triple by 2014.

"However, due to the current uncertain economic outlook, we anticipate that there will be extensive delays in the office development pipeline," said Robert Johnston, the firm's associate director for tenant strategies and solutions.

CBRE managing director Marc Townsend said the increase in manufacturing in Da Nang's industrial parks would require more back office and follow-on services, which was expected to support demand for office space over the next four quarters.

Da Nang gained a year-on-year GDP growth of more than 11 per cent in the first half of this year compared to the national rate of 5.57 per cent. The city currently has 27 buildings offering around 80,000sq.m of office space.

EuroCham confidence in Viet Nam declines

Business confidence among European firms in Viet Nam fell for a third consecutive quarter, a survey by EuroCham has found.

EuroCham members who participated in the quarterly Business Climate Index survey done in early July continued to be cautious in their business outlook for the third quarter and sombre in assessing their current situation, sending the Index dropping by seven points to 63.

Around half the businesses (177 in total) are in the services industry, a quarter in manufacturing, and the rest in trading or other activities.

There was a 10 per cent drop in respondents assessing their current business situation as "good" or "excellent". It was 56 per cent in the second quarter and 64 per cent in the first.

The shift was mainly towards a neutral assessment of the current situation, with a 10 per cent rise to 38 per cent.

The number of businesses having a negative view of their current situation rose slightly from 12 to 16 per cent.

There was a similar shift in companies' business outlook, with 41 per cent saying "good" or "excellent", a 10 per cent fall from the last survey and a significant drop from the 72 per cent that had a positive business outlook in the first quarter.

The shift has been towards a neutral outlook which is the second highest category with 37 per cent.

Around 20 per cent had a negative business outlook, slightly up from 16 per cent.

When asked about their investment plans for 2011, respondents were more cautious than in previous surveys.

Most companies (32 per cent) want to maintain their level of investment and 31 per cent are looking to increase their investments in Viet Nam by a little.

Though 52 per cent still want to increase their investment, this is put in perspective by 45 per cent looking to maintain or even reduce their investment.

When asked about expected orders and revenues in the medium term, the answers were quite positive – 54 per cent expect an increase in revenue in the medium term, compared with 43 per cent in the last quarter.

Fewer companies (42 per cent) expect orders to remain unchanged or decline from the last quarter when it was 56 per cent.

Asked about recruitment plans, 51 per cent responded that they expect to hire more staff in the medium term, with 34 per cent expecting to maintain it at the same level, and 9 per cent looking to reduce.

Predictably, 56 per cent expect inflation to have a significant impact on their business and 37 per cent expect to be impacted in some way. Around 6 per cent said inflation was actually threatening their business in the country.

Despite ongoing initiatives to reduce the administrative burden on companies operating in the country, these reforms have yet to have an impact.

When asked about the effect of bureaucracy on their business over the past year, 53 per cent said it had remained constant.

Around 33 per cent said it had worsened and only 10 per cent reported a decrease.

Entire East-West Highway ready by late November

The entire East-West Highway, including Thu Thiem Tunnel under the Saigon River, will be officially opened to traffic on November 22 this year.

This decision came at a meeting last Friday where HCMC chairman Le Hoang Quan was briefed on the project by the city’s Management Board of Traffic Construction and Urban Projects, Japanese main contractor Obayashi and relevant authorities.

There will be no technical opening of the highway on National Day, September 2.

Luong Minh Phuc, director of the management board, said this would save money and time to solve any technical matters.

Obayashi also proposed putting the highway and Thu Thiem Tunnel into full operation after the deadline of November 15. Quan selected November 22 to open the whole project to traffic in commemoration of the 71st Southern Vietnam’s Uprising Day on November 23.

Garment making is cheaper in the country
 
A new trend in the garment and textiles industry to establish production facilities in provinces far away from cities could prove beneficial on many counts, industry insiders say.

Apart from addressing the almost chronic problem of labour shortage, it would help reduce production costs by way of lower land rents, and ease infrastructure and other pressures on major cities, they add.

A 10-year (2011-20) development strategy prepared by the Viet Nam Textiles and Garment Corporation (Vinatex) plans to invest over US$2 billion in building 31 fibre production plants, 21 dyeing and weaving factories and 164 sewing factories.

Most of these new facilities will be located in provinces in different parts of the country, marking a shift from the past when Vinatex member companies were located in major cities.

Vinatex deputy general Le Tien Truong said this shift was expected to help address the chronic labour shortage that the industry has suffered until now.

At end of 2010, Viet Nam had 3,710 companies in the textile and garments industry, 62 per cent of them in the southern region with more than half located in HCM City and the remainder in Binh Duong, Dong Nai and Long An provinces.

Ha Noi also accounted for nearly half the total member of textile and garment enterprises in the north.

Because it was a labour-intensive industry, it had to compete with other sectors for workers needed to fulfil export orders, Truong said.

In this tussle, the textile and garments industry often lost out because it could not offer higher wages, he added.

At present, the average income of the industry's workers is just $120 per month so it cannot afford to keep workers in major cities in coming years, according to Truong.

Although the textile and garment industry is determined to use modern technology and equipment to improve product quality and reduce labour demand, the number of workers needed to increase the industry's production capacity would still be high and is estimated to reach 1 million in the next 10 years.

In addition to the labour difficulties, the industry also found land rentals too high compared to low profit margins, Truong said.

To implement the shift away from major cities and neighbouring localities, many surveys were conducted to find ideal investment locations.

The target localities include Phu Tho, Tuyen Quang and Thai Nguyen provinces in the north; Thanh Hoa, Nghe An and Quang Tri in the north-central region; Thua Thien-Hue, Quang Nam, Binh Dinh, Phu Yen in the south-central region; and Tay Ninh, Tien Giang and Dong Thap in the south.

"These localities have the advantage of having plentiful labour resources and relatively low land rentals, but they also have the disadvantage of insufficient infrastructural facilities, particularly those needed for export activities, which will push transportation costs to a very high level, Truong said.

However, the development of textile and garment factories in rural areas would not only benefit the industry, but also the localities by creating jobs and increasing local incomes.

Truong said that the move would also help cities like Ha Noi and HCM City by easing pressures relating to increasing number of immigrants, transportation demand and environmental pollution.

Ministry readies tighter disclosure rules

A draft circular expected to be formally issued by the Ministry of Finance later this year would strengthen disclosure requirements applied to larger public companies, based upon charter capital and number of shareholders.

Companies with charter capital of VND120 billion (US$5.8 million) and 300 or more shareholders would be required to release audited financial reports twice a year, within 45 days or the end of the reporting period (60 days for consolidated reports). To standardise the reporting, Viet Nam Association of Certified Public Accountants general secretary Bui Van Mai also suggested that companies be required to give reasons for changes in equity.

However, Nguyen Khac Hai of SSI Management Fund said the request for audited financial statements would be a burden on companies.

"Enterprises would not risk distorting figures in their unaudited financial reports as it would be easy to discover and they would lose prestige," Hai said. "Therefore, it is not essential to have audited annual financial reports."

Listed companies with charter capital in excess of VND30 billion ($1.5 million) but fewer than 300 shareholders would only be required to disclose audited financial statements annually.

Nguyen Son, head of the market development department of the State Securities Commission, said that differing treatment for listed and unlisted public companies was appropriate to Viet Nam's current conditions, with a lot of unlisted public companies.

"However, the drafting committee will consider a more coherent distinction," Son said.

Under the draft circular, unlisted public companies would only have to disclose audited financial statements annually, although the commission would encourage companies to make quarterly reports.

The circular also includes proposed provisions on insider trading, forbidding company insiders from registering to buy and sell shares within the same reporting period. However, registration time would be reduced from 60 to 45 days.

Robert Singletary, a legal expert who participated in the drafting process, said insiders should also register the number of shares and the price range in order to increase transparency of their transactions.

In another major provision of the draft circular, the Viet Nam Securities Depository Centre would be required to release two additional types of information, including transfers of shares by the company's founding shareholders and changes in the proportion of foreign ownership in the company.

Lacking from the circular, however, are details of what information and time frame would comply with these disclosure requirements. Currently, the centre discloses information on market members, registration services, and issuance of trading codes for foreign investors.

Mekong Delta leaders want more city support

Leaders of 13 Cuu Long (Mekong) Delta provinces praised HCM City's contribution to their development, urging further co-operation in sustainable development between the Delta and the city.

During the past decade, HCM City implemented co-operation agreements signed with southwestern provinces, which brought encouraging socio-economic results, participants said at a meeting held in HCM City yesterday.

Delta representatives urged HCM City to further cooperate in infrastructure development, high-quality human resource training, and healthcare linkage for sustainable development of the region.

The Delta provides 90 per cent of rice export and 60 per cent of seafood export turnover.

Since 2000, 782 projects worth VND199 trillion (US$9.7 billion) from HCM City have been launched in 13 localities.

In addition, several technology-transfer projects between HCM City and the provinces have been deployed.

The Delta has a total of 151 industrial parks. Most HCM City's investors prefer to pour money into Long An, Can Tho and Kien Giang provinces.

Long An Province, which borders HCM City, attracted the most investment projects from the city, with 420 projects worth more than VND60 trillion ($2.9 billion). Kien Giang Province received 103 projects worth VND88 trillion ($4.2 billion) over a five-year period.

Leaders of Can Tho City, Mekong Delta's hub, reported that they had accepted 61 investment projects worth VND23 trillion (US$1.1 billion) in a 10-year period.

Most projects focused on tourism, infrastructure development and retailing.

Nguyen Phong Quang, deputy head of the Southwest Standing Steering Committee and head of the Mekong Delta Economic Co-operation Steering Committee, said agreement should exploit the area's advantages and seek balanced investment.

The delta, with 17.5 million people, is a large consumer of goods and services from HCM City.

The chairman of HCM City People's Committee, Le Hoang Quan, said the city government actively promoted businesses in the Cuu Long (Mekong) Delta to foreign and local investors.

The city has worked with several sectors, including infrastructure development, environmental protection, healthcare, hydro-power development and others.

"We see cooperation as an important task," Quan said, adding that infrastructure would receive investment priority.

Agriculture is also a huge investment. Every day, the city consumes 500 tonnes of livestock, 200 tonnes of vegetables and 250 tonnes of rice.

Training high quality human resources would also be a priority, Quan added.

Nguyen Hoang Minh, deputy head of the HCM City Department of Planning and Investment, said that HCM City's investors preferred the provinces of Binh Duong, Dong Nai or Ba Ria – Vung Tau rather than those in the Cuu Long (Mekong) Delta because of the latter's undeveloped transport system.

Quan said priority policies should be developed for farmers and investors who want to start projects in the Cuu Long (Mekong) Delta.

Transport had improved, which had helped to further more linkages between the city and the Delta.

One of the important co-operation programmes between HCM City and Cuu Long (Mekong) Delta provinces was climate change adaptation,he added.

Quan said the results of the conference discussions would be submitted to the central-level government to help them develop proposals to promote sustainable development in the Delta.

The Cuu Long (Mekong) Delta leads the country in agriculture value, with 33.2 per cent, while the region's industrial value contributes 9.23 per cent to the country.

The delta provinces and HCM City will also chair a conference on agriculture investment promotion today in HCM City.