Haiphong ranks second in FDI attraction

Over the past eight months, the northern port city of Haiphong has attracted over US$1.1 billion in new foreign direct investment (FDI) ranking second in the country after Binh Duong province in the south.      

The city issued licenses for 20 new FDI projects, capitalizing at US$1 billion, and approved 18 existing projects registering to increase an additional of US$77.46 million.

Of the total value, 97 percent comes from Japan, mainly for high-tech industry projects.

Most notable are the US$547.8 million Bridgestone rubber tire company, the US$250 million Nipro Pharma Vietnam and the US$199 million Fuji Xerox Haiphong.

General Electric Vietnam registered the biggest increase in capital with US$43 million.

However, several projects have had to reduce their investment or stop operations. One cut US$47.192 million in capital, two were dissolved ahead of schedule, three were merged, another ran out of operation time, and four more had their licenses revoked for not carrying out their work.

To attract more foreign investment, the city is advised to implement comprehensive measures to ensure sufficient human resources for these projects, accelerate land clearance and begin its public investment projects.

800 businesses join Vietbuild 2012

Around 800 foreign and domestic businesses will take part in the International Construction, Building Materials, Housing and Interior Decor Exhibition (Vietbuild 2012) in Ho Chi Minh City from September 13-17.   

There will be over 2,200 stands showcasing the industry’s hi-tech products, cutting edge environmentally friendly technologies and nano-technology electrical equipment.

A conference on opportunities to provide building materials for the CT Group’s 24 projects and export to Myanmar will also be held as part of the event.

The exhibition will serve as a useful venue for businesses to seek new opportunities and promote their products to local and international markets.

Vietnam boosts regional cooperation initiatives

Minister of Industry and Trade Vu Huy Hoang attended the 44th ASEAN Economic Ministers’ Meeting (AEM 44) and related meetings in Siem Reap, Cambodia, from August 26-31.

This is an important annual meeting for economic ministers of 10 ASEAN countries and partners to discuss the situation of economic cooperation inside the bloc and with partners as well as to prepare contents for the 21st ASEAN Summit and related meetings in coming November.

At AEM 44 and related meetings, Vietnam actively joined other ASEAN member nations to discuss measures to speed up the top priority of building the ASEAN Economic Community (AEC) by 2015.

Vietnam is among four countries with the highest rate of implementing a coherent plan to establish the AEC in the bloc.

It has worked closely with other countries to promote soon issuing tariff schedule, under the ASEAN Trade in Goods Agreement (ATIGA), helping export businesses benefit from original agreements.

Vietnam supported efforts to carry out the ASEAN Single Window Initiative (ASW) and eliminate non-tariff barriers and proposed to implement the ASEAN framework for an equitable and sustainable development, contributing to narrowing the development gap among countries.

Based on Vietnam’s proposal, ASEAN nations reached consensus on speeding up the building of an action plan on sustainable development, including specific measures and programmes to help Cambodia, Laos, Myanmar and Vietnam to bridge their development gap with the remaining six ASEAN nations, contributing to building a sustainable ASEAN Community.

 At the meeting, Vietnam together with ASEAN member countries and partners promoted the implementation of the ASEAN Framework for Regional Comprehensive Economic Partnership (RCEP), with the aim of establishing an agreement that affirms the core role of ASEAN member countries in the joint economic structure within Asia-Pacific.

Vietnam also continues fostering cooperation initiatives between Cambodia, Laos, Myanmar and Vietnam (CLMV) at the fourth CMLV Economic Ministers’ Meeting.

At the event, they were unanimous in annual cooperation programmes, such as conference on market management cooperation, and e-commerce development, specific trade fairs and human resources development scholarship programme.

On the sidelines of the AEM 44, Minister Hoang held bilateral meetings with representatives from some ASEAN countries to discuss issues on speeding up trade and economic ties.

ASEAN economic integration always plays an important role in Vietnam’s economic policy. ASEAN is now the country’s second largest trading partner, with the 2011’s two-way turnover reached US$35.3 billion. The association is the third biggest importer and also the second biggest product supplier to Vietnamese businesses.

Russia values trade ties with Vietnam

Economic and trade cooperation between Russia and Vietnam is growing dynamically, said Russian Deputy Minister of Economic Development Alexei Likhachev.    

The Russian news agency Itar-Tass quoted Likhachev as saying on August 30 that two-way trade between Vietnam and Russia hit US$3 billion last year and US$1.7 billion in the first half of this year, which is yet to match the two countries’ potential.

The deputy minister, who paid a visit to Vietnam recently, added that Russian President Vladimir Putin and President Truong Tan Sang had set a target of bringing two-way trade to US$10-12 billion a year.

In order to fulfill the target, he suggested the two sides further expand comprehensive cooperation in the fields of energy, natural resources, and automobile and aircraft manufacturing.

The negotiations for a free trade area between Vietnam and Customs Alliance members, including Russia, Belarus and Kazakhstan, will contribute to further promoting Vietnam – Russia economic and trade cooperation, the deputy minister said.

Goods, services revenue surges this year
 
The country's total retail revenue of goods and services in the first eight months of the year surged 17.9 per cent over the same period last year to VND1,517 trillion (US$72.3 billion), according to the General Statistics Office (GSO).

Excluding inflationary factors, the revenue grew 6.8 per cent year-on-year, the GSO said in a monthly report.

August alone, the value rose 0.6 per cent against the previous month to VND190.32 trillion.

GSO's expert Vu Manh Ha attributed the rise to the growing consumption demands in the third quarter when the country celebrated various festivals and started a new school year.

Ha said that demands for consumer goods like foodstuffs, garments and textiles, footwear, stationery, books and notebooks surged significantly during the past month. Demand for tourism also surged 5.5 per cent.

GSO reported that the trade sector had the biggest contribution of VND1,171.62 trillion and accounted 77.2 per cent of the country's total retail sales revenue, up 17 per cent year-on-year.

The hotel and restaurant sector saw a year-on-year revenue rise of 19.9 per cent to VND171.3 trillion while tourism and service sectors had an increase of 31.3 per cent and 21.1 per cent to VND16.33 trillion and VND150.46 trillion, respectively.

Ha forecast that the total retail sales revenue would continuously increase thanks to higher demand during the Christmas and New Year season. However, the rising rates would not be significant and would be lower than that of the previous years.

Traders also forecast that purchasing power would increase significantly in the next few months.

The country's total retail sales and service revenues are forecast to rise between 22 per cent and 23 per cent year-on-year to VND2,445 trillion this year.

Lack of expertise slows State projects

State-funded construction projects need to be required to hire project management consultants in accordance with the law, says Viet Nam Federation of Civil Engineering Associations president Tran Ngoc Hung.

Under the current laws on construction and enterprises, if developers lack sufficient experience in managing a major construction project, they must retain consultants to ensure project progress. Yet, Hung said, few have complied with this provision as they were "afraid" of losing power – and profits.

The incompetence of agencies has been partly to blame for many slow-moving projects and low-quality construction projects.

In projects built by ministries, municipal or provincial People's Committees and State enterprises, projects are managed by ministers or People's Committees chairman or the head of institutions that will use the finished structures, e.g., school principals and directors of hospitals, theatres, and museums.

Many of those people lack expertise and experience relating to construction projects.

Le Van Thinh, an official from the Department of State Examination of Construction Work Quality under the Ministry of Construction, said that incompetence in project management could affect quality or lead to impulsive decisions in selecting designers or contractors, with many officials preferring to choose contractors they know rather than opening projects for tender as regulated.

Some projects have lost time and money because designs have had to be readjusted or building materials reinstalled.

Thinh said that it was necessary to add requirements for State-funded projects to avoid actions that can cause a waste of public funds. Needed regulations would govern the sorts of legal entities that can service as consultants and qualifications of consultants to deal with certain kinds of projects, as well as requirements that architects and civil engineers have sufficient experience and have worked on at least one project of a similar kind.

Hung suggested that project management boards be established based on fields. For instance, an educational project management board would specialise in school, library and lab projects, giving them skills to handle problems effectively and ensure progress and work quality.

 Deficient law deters firms from listing
 
While the stock market is an effective channel for both domestic and foreign-invested enterprises (FIEs) to raise funds, few FIEs have been listed due to the inadequacy of the law.

Only eight of 704 listed companies on the two national stock exchanges were FIEs with a combined registered capital of over VND4 trillion (US$190.4 million), accounting for 14 per cent of the total capital of joint stock FIEs.

"The capital of listed FIEs occupied a very small percentage of the billions of foreign direct investment into Viet Nam, while it will continue to grow fast," said the State Securities Commission's head of market development department Nguyen Son.

Some FIEs had converted into public companies, listed shares and raised an abundance of funds, he said.

In the two years of 2006 and 2007, Taiwan-invested construction firm Full Power, which delisted on August 11, succeeded in issuing an addition of 23 million shares. Meanwhile, casino chain Royal International (RIC), also invested by a Taiwanese organisation, and Malaysian International Food (IFS), issued 5.7 million and 4.8 million shares, respectively.

Son said that legal procedures for an FIE to become a joint stock company had been much simpler under the regulations of Decree 101/2006/ND-CP on registration and conversion of foreign investment certificates. However, there were still some contradictions in Decision 55/2009/QD-TTg relating to the percentage of foreign ownership allowed in public companies.

The cap of 49 per cent on foreign ownership in joint stock FIEs was inconvenient for companies that wanted to sell more stocks to foreign investors, Son told the Investment Securities

"Not only does it violate the rights of foreign shareholders, it also causes foreign divestments."

Many foreign shareholders of unlisted FIEs had asked investment licensing agencies to sell part of their stakes, making them less than 49 per cent, he added.

"However, if FIEs can easily convert themselves into joint stock companies according to Decree 101, there will be a risk of transfer pricing to the market," he said.

To improve the situation, according to the commission official, the cap on foreign ownership of converted FIEs should be removed. "Only specialised industries should be limited this way," he said.

Although it might cause some inequalities between FIEs and domestic companies, in which foreign investors can contribute a maximum of 49 per cent, these two kinds of business differed in terms of capital and established methods.

In addition, Son suggested some criteria for transforming FIEs into joint stock companies in order to assure long-term and effective investment.

The conditions he advised included at least five years of operation in the Vietnamese market with a charter capital of $10 million or more, a return on equity ratio of 5 per cent in three years preceding the conversion and no accumulated losses, and commitment to hold at least 30 per cent within three years from the conversion or one year after listing.

 Buy-local campaign gets results
 
An ongoing campaign to get Vietnamese to give priority to buying Vietnamese products has led to a 25 per cent increase in the sales of domestic goods and services compared to the same period last year.

After nearly three years, the campaign has made significant progress in getting domestic businesses to buy local goods.

This has already led to a reduction of stockpiled goods, said Deputy Minister of Trade and Industry Nguyen Nam Hai.

Hai said this had helped lower the trade deficit and boosted production levels in the country. State-run corporations and companies, including Viet Nam Oil and Gas Group (PetroVietnam), Viet Nam Steel Corporation, Viet Nam National Coal and Mineral Industries Group (Vinacomin), among others, are leading the campaign.

"PetroVietnam is using domestic products and goods including fuel, diesel, cement, stone and sleepers, among others, for production", said its representative.

PetroVietnam, which usually imports coal from Indonesia and Australia, recently signed a contract with Vinacomin to buy 800,000 tonnes of Vietnamese coal for thermal power plants and cement factories.

Another State-owned corporation, Viet Nam Steel, has also started to use liquefied petroleum gas from Viet Nam instead of imported fuel oil.

This has saved up to VND72 billion (US$3.4 million) per year.

Provinces and cities are also reported to be working with each other to boost use of domestic goods.

As part of its contribution to the campaign, the Department of Trade and Industry in Ha Noi will soon begin promoting exhibitions throughout Viet Nam.

It will also open offices for consumers, providing information on prices, origin of goods and products.

Hai said enterprises should improve their products and goods if they wanted the campaign to be fully effective.

He added that the Ministry of Industry and Trade would submit a plan to the Prime Minister requiring corporations and companies to buy domestic products.

BQ shoes company director Phan Hai said.

The State should improve infrastructure and simplify lending procedures to encourage local business.

Rice export target within reach, despite challenges

Rice exports were up to expectations despite many difficulties in the world rice market, said experts.

The Viet Nam Food Association (VFA) expected Viet Nam to export 2.82 million tonnes of rice in the remaining months of this year. As a result, the country will ship abroad over 7 million tonnes of rice this year.

However, the association also said the world rice market would continue its instability and even have unexpected developments.

Deputy Minister of Industry and Trade Nguyen Thanh Bien said the association should work with the Ministry of Agriculture and Rural Development and provinces should review the quality and output of rice to meet demands of the market.

For Asian markets, especially China, rice exporting enterprises should be more active and professional to enter the markets and develop trading, Bien said.

The VFA should continue to be an export promotion centre, to limit risks in payment and create close co-operation among enterprises of Viet Nam and China by opening a representative office in China, he said.

The trade ministry would continue to seek new export markets for Vietnamese rice to reach the national target, he said.

Viet Nam had difficulty in exporting low-grade rice so many local rice exporters have changed to exporting high-grade rice, though Viet Nam did not have advantages in the commodity.

The association recently organised a trade fair for 50 Vietnamese rice exporters in Guangzhou Province, China, to introduce Vietnamese high-grade rice to the Chinese market. At the trade fair, Vietnamese enterprises signed contracts to export 1.5 million tonnes of high-grade rice to China.

Pham Van Bay, VFA deputy chairman, said opening a representative office in China would help enterprises of the two countries get information about the financial ability of Chinese firms and the market demand of China.

Taiwan, Hong Kong and South Korea still had a high demand for Vietnamese rice, Bay said.

According to the agriculture ministry, Viet Nam exported 5.5 million tonnes of rice in the first eight months of this year, earning US$2.48 billion. The exports saw a year-on-year increase of 0.5 per cent in volume but a year-on-year reduction of 8.5 per cent in value.

During the first eight months, China was the largest export market for Vietnamese rice. Vietnamese rice exports to China increased 5.2 times in volume and 4.4 times in value compared with the same period last year.

Falling tax receipts inflate State deficit

Reduced tax collections threaten to widen the State budget deficit this year, warns the General Statistics Office (GSO).

State budget revenues through mid-August totalled an estimated VND418.5 trillion (US$19.9 billion), equal to about 56.5 per cent of this year's target and therefore somewhat behind the pace needed to meet the target at year's end.

Meanwhile, State spending totalled VND534 trillion (US$25.4 billion) during the period, resulting in a deficit estimated at VND116 trillion ($5.5 billion).

Boosting tax revenues in the remaining months of the year would require flexible measures to curb inflation, increase business and production, hasten investor disbursements, and boost consumer demand in order to reduce inventories.

Yet the deputy director of the Ho Chi Minh National Politics and Administration Institute, Le Quoc Ly, said the nation's current fiscal policies had done little to nurture tax collections.

Ly pointed to slow tax payments, wasteful public spending, and slow progress on many public construction projects.

Do Trong Kha nh, director of the Ministry of Finance's finance and monetary department, said the Government needed to increase the transparency of public expenditures and rein in borrowing by State-owned enterprises.

Regulations on corporate bonds needed to be revised to create more favourable conditions for State-owned enterprises to raise capital without relying on State budget resources, while hastened equitisation of these firms would also enhace their ability to raise capital, Khanh said.

"We need to keep the State budget deficit at less than 4.8 per cent of GDP," he added.

Among local governments, HCM City was facing a budget shortfall of VND4 trillion ($190.4 million) while several provinces were under water by VND1-3 trillion ($47.6-142.8 million). Overspending by local governments this year was projected to totall VND20-25 trillion ($952 million to $1.2 billion).

Forum looks at cloud computing
 
A forum was held this week by EMC, a leading provider of storage solutions, focusing on cloud computing, the latest wave of innovation in information technology, and how it was poised to change the IT industry in Viet Nam

At the forum, Deputy Minister of Information and Communication Nguyen Minh Hong expressed appreciation for the new solutions being introduced by leading global IT companies to assist Vietnamese businesses and government agencies to apply cloud computing technology.

Hong urged Vietnamese businesses to invest more in technological infrastructure and human resources training in order to be positioned to apply this advanced technology.

Nguyen Duc Toan, sales director of EMC Viet Nam, said a combination between private and public clouds was the latest trend, a model that combined flexibility, easy access, and low cost. In the future, private clouds would become fully-automated infrastructure operating in partnership with businesses, he said. Most enterprises would connect their private cloud to public clouds, creating a hybrid cloud, combining what each IT organisation does best with what partners can do.

Such a system would allow businesses to take full and effective advantage of hardware resources, while still keeping effective management of their information, Toan said.

With cloud computing, enterprises can virtualise many important applications by moving existing applications to a virtualised infrastructure without interruption. In so doing, they can reduce hardware costs, he said.

Toan pointed to the example of the New York Stock Exchange, which was building infrastructure-as-a-service and platform-as-a-service for the financial services industry with scalability and compliance for financial services built in.

Hong said that his ministry was considering the applications of cloud computing in State agencies through outsourcing, with investment to come in the form of public-private partnerships. Many State entities have already applied cloud computing, he noted, including the Ministry of Environment and Natural Resources and the Ministry of Finance.

However, Hong acknowledged that inadequate human resources, low level of awareness in businesses and organisations, and concerns about security and privacy remained as barriers to the application of cloud computing in Viet Nam.

Elenex fair returns with new technology

The fourth Elenex Viet Nam exhibition will return to Sai Gon Exhibition&Convention Center on September 19 – 21 with the participation of 260 international and local exhibitors.

The exhibitors will showcase mainstream and state-of-the-art products and technologies at the 3-in-1 trade show covering an area of 6,500sq.m, making it Viet Nam's prime trading and industrial event.

The three exhibitions include Elenex Viet Nam; Architecture Building M&E Viet Nam; and Industrial Automation Viet Nam.

The event was organised by Hong Kong Exhibition Services Ltd in collaboration with VCCI Exhibition Service Ltd Co and Overseas Exhibition Services Ltd.

According to the organisers, the Viet Nam Ministry of Industry and Trade anticipates industrial output growth in the FDI segment to remain at a high year-on-year increase of 15 per cent. Industrial and construction works are the industries that attract the largest share of FDI to Viet Nam.

According to the National Power Development Master Plan VII, electricity demand in Viet Nam will continue to grow by 14 – 16 per cent per year in the 2011-15 period, and 11.15 per cent per year in the 2016-20 period.

The promising outlook of Viet Nam's economy as well as its energy make it a favourable destination for investors.

Industrialists and manufactures seek to exploit the potential of the Vietnamese manufacturing sector through the introduction of comprehensive automation systems.

SeaBank ranks top 50 best bureau

SeABank's transaction bureau was ranked 29th out of the 50 best transaction bureaus in the Indochina region of Western Union in 2011.

This ranking was based on three criteria: business growth, service quality and customer satisfaction.

Starting from August to 11, 2012 all the bank's clients who make transactions via Western Union will enjoy more incentives if they use at least two different products and services of SeABank such as opening an account, depositing money in their savings account or signing up for e-banking services.

Kon Tum plans pulp forest, paper mill

The Central Highlands Province of Kon Tum has announced plans for a material area including Tan Main Pulp and Paper Mill.

Covering an area of nearly 50,000ha, the area would cover the province's eight districts including Ngoc Hoi, Dak To, Dak Ha, Kon Ray, Kon Plong, Sa Thay, Tu Mo Rong and Dak Glei. The area would provide materials for the plant with yearly capacity of 130,000 tonnes of pulp and 200,000 tonnes of coated paper by 2014. The project would be implemented in the period of 2012-20 with total investment of VND3.3 trillion.

DHL launches new service to Malaysia

DHL Global Forwarding, the air and ocean freight specialist within Deutsche Post DHL, launched its direct Less than Container Load (LCL) service between Malaysia's Port Kelang and HCM City on Wednesday.

The new weekly LCL service between Port Kelang and Cat Lai Port offers three-day transport, saving customers up to 10 days and boosting trade flow between South-East Asia's third- and sixth-largest economies.-

Telecos post high profits in first 9 months

Telecommunications turnover in the first eight months of the year was VND105 trillion, increasing 6.8 per cent over the same period last year, said the General Statistics Office.

The office said the number of new registered subscribers in the period was more than 7,600 including 15,700 fixed ones and 7.6 million mobile ones.

The number of subscribers by the end of last month was 135.8 million, an increase of 5.2 per cent against last year of which 15.1 million were fixed subscribers and 120.7 million mobile ones. Internet subscribers were estimated at 4.4 million, representing a 15.6 per cent increase over last year.

Vinacomin coal development plan okay

The Viet Nam National Coal, Mineral Industries Holding Group (VINACOMIN) said the Government has approved coal development planning by 2020 which allows the group to explore and exploit more than 160 projects. The Department of Geology and Minerals said they have received 6 applications for exploration and 10 for exploitation. The department has been rushing to complete procedures to grant licences to the projects under planning.

Seafood production rises by 4%

The Ministry of Agriculture and Rural Development said in the first eight months of the year, aquaculture output reached 3.63 million tonnes, increasing 4 per cent over the same period last year.

Of the total, sea exploitation was 1.6 million tones, 7 per cent higher than the corresponding period last year. Central Binh Dinh, Phu Yen and Khanh Hoa provinces had the highest tuna productivity. Aquaculture raising output in the period was 1.9 million tones, representing a 3 per cent year-on-year increase.-

Cooking gas prices increase by $2.50

Gas retailers in the city said gas prices would be raised by VND51,000 to an average price of VND420,000 per 12kg canister as of today.

The distributors said the increase was because the world price of imported gas rose $175 per tonne against the previous month. In the past two months, domestic gas prices rose by VND103,000 per 12kilo canister.

Facebook ads to target address, number

Facebook plans to roll out a new advertising tool that will allow companies to target existing customers based on their phone numbers and e-mail addresses.

The social network is launching the new tool next week and touts it as a way for businesses to re-engage with customers who have already used their services, according to a Facebook spokesperson.

For those who may have privacy concerns over this exchange of personal information, the social network said the process is secure.

What this means is Facebook isn't giving any of your data away, it's taking existing numbers and addresses from businesses and letting those businesses use the information to target customers.

 Job website launches mobile application

Jobstreet.com, one of Southeast Asia's leading employment websites, has launched a mobile application Jobstreet.com Mobile App to help jobseekers in Viet Nam.

The Jobstreet.com Mobile App, the first of its kind in Viet Nam, offers a unique way for iPhone users to search for jobs on the website, apply for them and share information with friends.

Jobstreet.com is a recruitment website available in Malaysia, Singapore, the Philippines, Indonesia, India, Japan, Thailand and Viet Nam. It has more than 200,000 business users and over 10 million applicants.-

Shares fall ahead of holiday break
 
Shares declined again after two consecutive rising sessions as investors became cautious ahead of the National Day holiday tomorrow.

On the HCM City Stock Exchange, the VN-Index gave up 0.31 per cent to close yesterday at 396.02 points.

Both trading volume and value decreased about 15 per cent from Thursday, totalling over 33.3 million shares, worth VND505.4 billion (US$24.1 million).

Blue chips were mixed. While property developer Hoang Anh Gia Lai (HAG), dairy producer Vinamilk (VNM) and Phu My Fertiliser (DPM) rose 1.8-3.4 per cent; real-estate giant VinGroup (VIC), Tan Tao Investment Industry Corp (ITA) and Phu Nhuan Jewelry (PNJ) hit the floor prices.

The VN30 tracking the top 30 shares on the southern bourse edged down 0.03 per cent overall, standing at 465.29 points.

ITA was also the most active stock by the end of yesterday's session with 1.5 million shares traded, but the shares shed 3.4 per cent to end at VND5,700.

On the Ha Noi Stock Exchange, the HNX-Index finished at 61.43 points, off 0.79 per cent from Thursday, with gainers outnumbering losers by 108-69. The HNX30 also decreased 0.97 per cent to 116.53 points.

Almost 27.5 million shares, worth VND258.2 billion ($8.7 million), changed hands yesterday, down 15 per cent in volume and nearly 7 per cent in value from a day earlier.

VNDirect Securities Co (VND) continued to be the most active code with total trades of 5.55 million shares, dropping 3 per cent to a close of VND9,900.

Many analysts attributed the downturn yesterday to the sluggish sentiment of investors before the holiday, treading carefully because of the lack of any promise of a solid upturn.

However, according to Saigon Securities Inc (SSI), reducing the proportion of poor stocks before the holiday is not a bad tactic and investors can consider the economic development after the holiday to have a better investment strategy.

Meanwhile, foreign investors continued their solid buying, concluding yesterday as net buyers again on both exchanges.

They were responsible for a combined net buy of VND32 billion ($1.5 million) worth of shares.

Steel demand slumps during August
 
Steel sales plummeted in August despite a slight decline in prices, the Viet Nam Steel Association reported.

Pham Chi Cuong, its chairman, said around 350,000 tonnes were sold, a 40 per cent fall from the previous month.

The Ministry of Industry and Trade had predicted at the beginning of July that consumption would increase soon due to the Government's support.

The VSA said due to the low demand, many steel plants had to cut back on production.

Some of them, like Southern Steel, Phu My, Thai Nguyen, and Nha Be, even shut down temporarily or worked at 30-45 per cent of capacity, it said.

Around 3,000 employees have been affected, with 900 without work for the whole month and the rest working in turn.

The lack of demand has seen inventories shoot up to 350,000 tonnes, the same volume as the sales, the VSA said.

It had been just 50 per cent of consumption in July, Cuong said.

Companies are now finding ways to boost exports.

Le Phu Hung, director of the State-owned giant Viet Nam Steel Corporation, said the Government should stimulate demand by cutting value-added tax and increasing spending on construction.

It should also encourage exports, he said.

This year the industry hopes to achieve 3-4 per cent growth in sales, but the VSA is not confident it can be achieved.

 Mekong looks to up export output quality
 
Although the Cuu Long (Mekong) Delta's major exports are mostly rice and seafood, the competitiveness of these products is still limited.

Both products account for two-thirds of the region's total export value, contributing an important role in the region's economic development.

However, the processing industry and service products have not matched the region's potential, according to participants at a seminar held in Can Tho City on Wednesday.

Last year, the delta, the country's most important rice, fruit, and aquatic farming region, earned an export revenue of nearly US$9 billion. Of the figure, rice accounted for $3.2 billion and seafood products $3.4 billion.

The delta has increased seafood exports by 14-22 per cent every year since Viet Nam joined the World Trade Organisation five years ago, and more than 90 per cent of the country's total rice exports now come from the delta.

Experts at the seminar said the value chain of rice and seafood products, including information channels about production, exports and price forecasts, should be improved.

Other needed measures include the creation of new brand names and upgrade of processing technology to increase product value investment. Efforts to attract foreign investors are also necessary.

Vo Hung Dung, director of the Viet Nam Chamber of Commerce and Industry's Can Tho Branch, said most of the region's exports came from domestic companies.

He said more foreign-direct invested companies were needed to process products. The delta's FDI accounts for less than 3.5 per cent of the country's total FDI.

As of last month, the delta has 612 foreign invested projects with a combined capital of $9.7 billion.

The seminar was organised by the Can Tho Investment-Trade-Tourism Promotion Centre in co-operation with the Oriental Bank, with the participation of more than 70 companies in the Delta and HCM City.

 Delta farmers face shortage of saline-resistant seeds

Rice-shrimp farmers in the Cuu Long (Mekong) Delta, who have begun planting the rice crop, are facing the usual shortage of saline-resistant rice varieties.

Farmers choose them since farming shrimp in between rice crops turns their fields saline.

In Kien Giang, Ca Mau, and Bac Lieu provinces, which have the largest areas of rice fields where shrimp is also farmed, the paddies have been drained off the salt water and farmers are waiting for rains to flush the residual salinity.

Nguyen Huy Thong, a farmer in Ca Mau's Thoi Binh District, said: "This area has adopted rice-shrimp farming for the last 10 years, so farmers have to plant saline-resistant rice."

"But the supply of these varieties is still limited, and farmers often face a shortage.

"Farmers sometimes have to deposit money with seed shops to get saline-resistant rice varieties."

Tran Van Dung, deputy director of the Thoi Binh District People's Committee, said farmers here have sown more than 800ha of seedlings for transplant in the district's 25,000ha of rice fields.

This year besides long-term rice varieties such as Tep Hanh, Mot Bui Do, farmers have also opted for new short-term varieties that can tolerate salinity rates of 0.4-0.6 per cent, he said.

Long-term varieties – which are tastier, and, hence, fetch more money – have a maturity period of up to six months, and short-term varieties mature in around half that period.

In Kien Giang Province's U Minh Thuong area, which has the largest rice-shrimp farming area in the province, many farmers have switched to short-term varieties this year.

Le Van Hien, who owns 3ha in An Minh District's Dong Hoa Commune, said: "Previously I grew long-term rice varieties, but in the last two years I switched to the short-term ST5 strain."

Cultivating short-term varieties requires less labour compared to long-term ones which require seedlings to be transplanted, he explained.

"Besides the ability to resist salinity, the ST5 variety offers high yields and is delicious and easy to sell.

"However, it is difficult to get this seed for this crop."

The strain was created in Soc Trang Province.

Trong, who has a seeds shop in Kien Giang's U Minh Thuong District, said his supplier has had no ST5 for about a month, and its harvest is only just beginning in Soc Trang.

Many farmers have also planted hybrids like B-TE1, PAC 807, HR 182, which are also suitable for growing in rice-shrimp fields.

Nguyen Trung Dien, director of the Kien Giang Agriculture Fisheries and Forestry Breeding Centre, said the centre has researched and created saline-resistant rice varieties in the past few years.

Its GKG 1, for instance, can tolerate more than 0.4 per cent salinity, he said.

The Kien Giang Department of Agriculture and Rural Development has warned farmers to thoroughly flush their fields of salinity after harvesting shrimp, using both rainwater and water from the canal to wash them two or three times over a period of at least one month before planting.

It has also encouraged farmers to switch from some long-term varieties that are of low quality and yield and disease-prone to short-term varieties of high quality and yield.

Farmers overcome difficulties with pineapple crops

Farmers in Tien Giang Province's Tan Phuoc District in the Mekong Delta have escaped poverty and become prosperous from planting pineapples.

Nearly 20 years ago, the district, which is located in the Dong Thap Muoi (Plain of Reeds) in the (Cuu Long) Mekong Delta, was full of wild plants and the soil was heavily contaminated by aluminium.

Tan Phuoc has the largest area under pineapple in the Delta, about 11,230ha.

Phung Hong Thanh, deputy director of Tan Lap Farm, said pineapple was first planted in Tan Phuoc in 1979 from seedlings bought from Go Quao, one of the major pineapple-planting districts in Kien Giang Province.

Go Quao District's soil conditions are similar to that of Tan Phuoc, according to Thanh.

When the planted pineapple seedlings bore the first fruit, the fruits had a delicious taste and flavour like Go Quao pineapple.

With initial success, the farm decided to expand pineapple cultivation in 1980, but until the 1996-2000 period, when the soil preparation for cultivation was done by agricultural machines, the area under pineapple was expanded to 3,200ha.

After this period, pineapple cultivation in Tan Phuoc began to grow.

Ngo Van Bien in Tan Phuoc's Tan Lap 2 Commune is one many farmers who have earned a high income from pineapple.

In 1990, Bien's family in Tien Giang's Chau Thanh District moved to Tan Phuoc's Tan Lap 2 Commune to work in the province's programme to reclaim the Plain of Reeds.

In the first few years, Bien and his wife planted cassave and then sugarcane, but all of these crops failed because the soil was heavily contaminated by alum.

"In 1996, I decided to plant pineapple, and I succeeded," Bien said, adding that his family was healthy and his children had received an education.

Bien now earns more than VND1 billion (US$47,000) a year from planting pineapple.

In Tan Thanh, one of Tan Phuoc's poor communes, most farmers have become prosperous from planting pineapple.

Nguyen Van Dung, chairman of the Tan Thanh People's Committee, said pineapple now accounts for 1,690ha of the commune's more than 1,700ha of agricultural land.

With an average yield of nearly 20 tonnes per hectare, farmers earn a profit of VND40-50 million a year, he said. The number of poor households in Tan Phuoc has fallen to 13.4 per cent from 29.23 per cent in 2006, according to district figures.

Nguyen Thanh Quy, deputy chairman of the Tan Phuoc People's Committee, said cultivation of the Tan Phuoc pineapple and six other fruits would expand.

The authorities of Tien Giang and Tan Phuoc have continued to invest in dyke systems and power grids for pumping water to protect pineapple in the flooding season over the past years.

The district has also co-operated with research instituts and vocational schools to provide advanced farming techniques to improve yield and quality of pineapple.

However, the district is facing a shortage of capital to upgrade dyke systems, and to build roads to transport materials.

VOV/VNA/VIR/SGT/VNS/SGGP/ND/Dtinews