63,500 products ready for Online Friday’s shopping spree

More than 63,500 products with generous discounts are ready for Online Friday’s shopping spree at the website onlinefriday.vn on December 4.

The online promotion, organised by the Vietnam E-Commerce and Information Technology Agency (VECITA) under the Ministry of Industry and Trade, aims to accelerate consumer demand and wireless purchases.

This is also part of the agency’s strategy to boost the development of e-commerce in Vietnam , according to head of the VECITA Tran Huu Linh.

Transactions will mainly be involved high-end clothes, books, watches, digital equipment, tourist products and household utensils.

Swatch and Guess brands planned discounts of 70 percent, while Mango, Nike and Dorothy brands will offer a 50-percent discount, as a few to name.

Jose Finch, Managing Director of Zalora Vietnam - one of the leading online fashion retailers, said Online Friday has become a special event of Vietnam ’s e-commerce sector which is anticipated by both consumers and businesses.

Apart from participating in the online shopping day, the company has also joined hands with over 50 e-commerce partners and retailers to launch “Online Fever” - its biggest-ever online programme, he said.

In response to the day, eight banks and credit institutions will offer cash-back services to online transactions. Also, express delivery firms like VietnamPost and ViettelPost have also committed to supporting online retailers with delivery cost halved.

Experts said online transactions valued 2.97 billion USD were conducted in 2014. The figure is expected to stand at 4 billion USD this year.

They forecast that e-commerce will continue to thrive in Vietnam in the coming time, especially at a time when the country is accelerating its international economic integration through the signing and negotiation of a range of bilateral and multilateral trade agreements.

Rice exports rebound after ten months of decline

Rice export shipments picked up in November after having dipped for 10 months in a row, according to the Ministry of Agriculture and Rural Development.

A report of the ministry indicated that Vietnam shipped abroad 885,000 tons of rice worth US$372 million last month, up 442,000 tons and US$155 million year-on-year respectively.

More rice export in November helped bring the volume in the first 11 months this year to 6.24 million tons worth US$2.65 billion, up 3.6% in volume but down nearly 4.9% in value compared to the same period last year.

The January-October average export price of rice was US$426.04 per ton, down US$34.05 year-on-year.

Nguyen Thanh Phong, director of Van Loi Corp. in Tien Giang Province, said the contracts Vietnam won earlier this year to sell 450,000 tons of rice to the Philippines and one million tons to Indonesia resulted in a sharp rise in rice shipments last month.

The ministry said the domestic rice market has benefited much from the two contracts.

According to the ministry, China remained the largest rice importer of Vietnamese rice in the first ten months, accounting for 34.49% of the total.

Besides, Vietnam sold more rice to other markets such as Ghana and the Ivory Coast.

The ministry’s Statistics and Informatics Center forecast Vietnam would export 6.8 million tons of rice this year, around 800,000 tons higher than the full-year target announced in September.

The Vietnam Food Association (VFA) said its member enterprises had signed contracts to export at least 7.6 million tons of rice of different varieties in the year to October.

Int'l firms seek opportunities in construction, mining sector

Many international companies have come to the International Trade Fair for Construction & Building Technology, Equipment, Machinery, Materials and Mining launched on December 2 in order to look for opportunities to provide products and services to Vietnam’s construction and mining sectors.

Germany’s Eirich Group, India’s KLR Industries, as well as many the Republic of Korea and Chinese companies are among those. Coming to the exhibition, the companies bring technologies in precast concrete production, drilling, grinding, steel production, etc.

The exhibition, held from December 2-5 at the Vietnam Exhibition Fair Centre in Hanoi, is a chance for companies both domestic and foreign to showcase their technologies, solutions as well as machineries and materials in construction and mining.

On the sideline of the exhibition, which is supported by the Ministry of Construction and the Ministry of Industry and Trade as well as related associations, are conferences and workshops that will gather industry experts in real estate, construction, building materials and mining.

Amata Vietnam celebrates the 20th anniversary

Amata Vietnam will host a ceremony in December to celebrate two decades of  successful operations in Vietnam.

The 20th anniversary ceremony of Amata Vietnam, themed “Drive to Future”, marks an important milestone in the company's journey, and sets the stage for their ambitious achievements yet to come. Chief among the aims of Amata's founder, Vikrom Kromadit, is the creation of perfect cities.

Amata Vietnam Co., Ltd. was established in December 1994 as a joint venture project between Thailand’s Amata Corporation Public Company Limited and Sonadezi Bien Hoa, a state-owned developer of industrial estates in Dong Nai province. Covering a total area of 700 hectares, the industrial park was developed in Bien Hoa city of the province and officially put into service in 1995.

Strategically located in the centre of the key southern economic hub, Amata Bien Hoa boasts  easy access to all essential facilities for business operations. This complex has become a favoured destination for investors in tandem with Vietnam's booming development.

With its long-term vision and comprehensive support services, Amata Bien Hoa – also dubbed “Perfect City” by its developers – has achieved considerable success, making a valuable contribution to the socio-economic development of Bien Hoa, and indeed Dong Nai as well.

Amata Vietnam has followed Amata Corporation's concept of a Perfect City, whereby a township with amenities must be built nearby industrial estates to provide homes for the workers.

Under its master plan, Amata Vietnam has run the two projects including Amata Industrial Park and Amata Commercial Complex, which have been merged to form the well-known industrial city.

Amata Industrial Park is one of the top choices of foreign investors in Vietnam due to its strategic location and well-developed facilities. As of August 2015, the park was home to 145 investors from 21 countries and territories with US$2.34 billion of investment capital and nearly 43,000 employees. The majority of Amata's clients are leading multinational corporations with globally-recognised brands such as Nestle, Pesico, Toshiba, Shiseido, Marigot, Bayer, Kao, and Ritek.

Meanwhile, Amata Commercial Complex saw its first tenant in 2009 and second tenant in 2010 – Honda Showroom and Lotte Mart, respectively. Together with Amata Service Centre, these projects occupy the most attractive “frontage” spaces along the National Road 1A.

The complex has nurtured new businesses and communities, while promoting a good quality of living, working and playing within the same site to meet the needs of both employers and their families. Amata Commercial Complex features a commercial hub, leisure and sports facilities, a residential area, a hotel, banks, shopping centres, international schools, clinics and Amata Square.

Amata Square is a 2.2ha public park for outdoor activities, which is considered “the lung” of Amata. The square will be a landmark for the area, inspired by the culture and history of both Bien Hoa and Thailand.

With the investment capital of US$1.2 million, Amata Vietnam is steadfast in its commitment to improving the living environment of the community. Amata Square was officially opened to the public on December 18, 2015 to celebrate Amata's 20th anniversary.

In addition, a book entitled 20 years of Amata Vietnam and the vision to the ASEAN Economic Community (AEC) will be launched at the event. The book was written by the founder of Amata Corporation, Vikrom Kromadit, and Dr Surin Pitsuwan, the Secretary General of ASEAN during 2008 – 2012. This is Vikrom's third book in Vietnamese, following the success of his previous two which sold over 40,000 copies in Vietnam.

The book reviews Amata’s investment and achievements in Vietnam over the past 20 years, while raising awareness about the AEC. It also features an interview with Vietnamese Deputy Prime Minister cum Foreign Affairs Minister Pham Binh Minh, and Minister of Planning and Investment Bui Quang Vinh, both of whom shared their vision for Vietnam within the wider context of the AEC.

Electronic product and component exports jump high

Exports of computers, electronic products and components skyrocketed 38.2% to US$14.3 billion in the first 11 months of this year, according to the statistics from the General Department of Vietnam Customs.

Exports of telephones and components also rose by 29.6% to US$28.5 billion in the period, leading the list of top ten key export items.

These products are currently shipped to many countries, including two leading markets – the EU and UAE.

HCM City, Hanoi, Bac Ninh, Vinh Phuc, Dong Nai and Binh Duong provinces have paid great effort to attract investors in the support industry in order to lure big production groups in these fields.

In October, Vinh Phuc province licensed 13 out of a total 21 Republic of Korea’s investment projects on manufacturing mobile phone components.

The management board of Vinh Phuc Industrial Zones also reported that many FDI businesses expanded their investment capital in the past 10 months. For instance, Partron Vina Ltd Company – a satellite company of Samsung - increased investment from US$140.5 to US$150.5 million.

World’s leading groups such as Samsung, LG and Microsoft have operated in Vietnam, opening up opportunities for the development of domestic electronic producers to become their possible component suppliers, expert said.

Real estate giant Vingroup buys into Hanoi sports company

Vingroup, one of the country's largest private businesses, has bought more than 67.1% stake in a Hanoi-based sports company for nearly VND560.2 billion (US$24.87 million), local media has reported.

The real estate conglomerate's acquisition of the controlling stake in Me Tri Sport and Entertainment Development Co., Ltd. is its latest effort to expand its business activities in Vietnam, following different acquisitions in retail and health sectors.

In 2007, Me Tri was assigned with 32.1 hectares of land in the city's center to build a US$15-million sports and entertainment complex.

However, in 2010, Hanoi's authorities changed the land's designated purposes to only allow non-commercial projects, effectively canceling the original plan.

Coca-Cola Vietnam to go under scrutiny for transfer pricing

The Ho Chi Minh City tax department has set up an anti-transfer pricing task force and is calling for a probe to be launched into alleged transfer pricing practices at Coca-Cola Vietnam, says an official.

The new force is tasked with watching businesses that show signs of the transfer-pricing practice, and is preparing inspections at these firms, Le Thi Thu Huong, deputy head of the city’s taxman, told Tuoi Tre (Youth) newspaper.

The Ho Chi Minh City tax department has recommended that the General Department of Taxation put Coca-Cola Vietnam under scrutiny for transfer pricing, Huong added.

“The city’s taxman had earlier inspected the beverage maker for its repeated losses, but no transfer pricing inspection has been made before,” the official said.

“So we have called on the General Department of Taxation, a higher authority, to look into the company’s alleged transfer pricing activities.”

Transfer pricing is a tactic multinational companies use to determine in which country they make their profit.

To this end, firms set prices at which they transfer goods and services between entities they own, which eventually enables them to shift cost between units and avoid paying large amounts of corporate income tax.

Coca-Cola Vietnam, which had constantly posted annual losses for two decades until last year, tops the Ho Chi Minh City tax department’s list of businesses suspected of transfer pricing.

The U.S. soft drink giant re-entered Vietnam in 1994, and had reported losses annually for the next 20 years.         

Last year Coca-Cola Vietnam said it had paid some US$20 million worth of corporate tax, according to a report on the company’s investment, business and tax obligations.

It was the first time in two decades the soft drink firm had paid tax after claiming accumulated losses of VND3.77 trillion ($169.5 million) as of the end of 2012.

The losses exceeded the initial investment of nearly VND3 trillion (US$135 million), according to the Ho Chi Minh City tax department.

The taxable profit of the company in 2014 was US$16.6 million, more than double the purported US$7 million in 2013, the drink maker said in the document submitted to Ho Chi Minh City authorities in May.

Coca-Cola has plans to continue expanding in Vietnam, after a US$210 million business expansion in 2014, and has pledged to make profits, according to the Ministry of Planning and Investment.

The firm made its debut in Vietnam in 1960, and re-entered the Southeast Asian country in February 1994.

Baskin-Robbins continues expansion in Vietnam

Baskin-Robbins, the world’s largest chain of ice cream specialty shops, has announced the opening of a new parlour at the Pearl Plaza in Ho Chi Minh City.

“Baskin-Robbins has seen tremendous success with its 31 ice cream shops in Vietnam, and we’re eager to continue to explore and expand in a country that holds so much promise,” says the franchisee General Director Nguyen Thanh Nam.

“As our brand continues to expand, we’re continually looking for entrepreneurs throughout the nation with a passion for their local communities to join our team and new locations.”

Baskin-Robbins combines delicious treats with a simple operating model. Franchisees enjoy convenient hours of operation, minimal equipment, and little product waste. They also benefit from award-winning training programs and comprehensive operating systems designed to help build business.

In 1945, Baskin-Robbins was founded in Glendale, California, by two ice cream enthusiasts who shared a dream to create an innovative ice cream shop that would be a neighbourhood gathering place for families.

Today, more than 300 million people around the globe visit Baskin-Robbins each year to sample from the more than 1,300 flavour creations available in its ice cream library.

Baskin-Robbins offers guests its wide range of hard scoop ice cream flavours, along with custom ice cream cakes, delicious frozen beverages, premium soft serve, and take-home frozen treats.

Nescafé Plan boosts farmers’ income

After five years of implementation, Nescafé Plan- a cooperative programme between the world's leading nutrition, health, and wellness company Nestlé, Western Highlands Agriculture and Forestry Science Institute (WASI), and other partners- has contributed to improving the quality and raising coffee yield by 14 per cent per hectare (ha).

The achievements of the initiative have increased farmers’ income by 14% per ha, equal to VND16 million (US$735) per ha per year.

This was the outcome of strenuous efforts made by stakeholders to keep Vietnam at the forefront of the global Robusta coffee industry.

The project, with active support from WASI, has played a significant role in bettering farmers’ incomes in the four Central Highlands provinces of Dak Lak, Gia Lai, Kon Tum, and Lam Dong through the provision of quality, high-yielding and pest-resistant coffee seeds.

For five years until October 2015, a total of 11 million seedlings were supplied to farmers, from a mere 76,000 seedlings in the first year (2011).  

The project is of high practical value as stunted coffee plantation areas with low quality and productivity now account for a large proportion of the Central Highlands, a major coffee area in the country. The results of the initiative are especially significant as previous re-cultivation efforts proved less-effective.

Aside from promoting coffee re-cultivation, the project provided training and technical support based on the 4C Code of Conduct of 4C Association to ensure sustainability in coffee production to more than one hundred thousand farmers.

By the end of the fifth year, over 21,000 farmers have been awarded 4C certifications, a huge improvement compared to the 1,500 farmers in the first year.

Nguyen Cao Tri, a coffee farmer in Di Linh township, Lam Dong province, shared, “Apart from higher incomes, our lives have been improved remarkably on account of the active and practical support from the project implementers. I hope the project continue supporting our farmers in the future.”

Nescafé Plan, running from 2011 until present, is part of Nestlé’s commitment to promote a responsible coffee supply chain from cultivation to production and consumption.

The project has elevated Nestlé to become the leading buyer of Vietnamese coffee as well as maintain Vietnam’s position as the world-leading Robusta coffee producer in the past five years.

Vinhomes launches real estate investors club

Vinhomes Investors Club, which promises to be a premier real estate investment club providing quality real estate investment education and resources for its members, guests and friends, has officially launched, according to its President Huynh Du An.

At the first meeting held November 28-30 at the Vinpearl Phu Quoc, An said the club’s emphasis and commitment to solid real estate investor education will enable its members to make calculated investment decisions.

“This will allow for continued wealth acquisition and wealth retention in Vietnam’s rapidly changing market environment,” said An.

He said Vinhomes will strive to provide its membership with the most current and essential real estate investment techniques, strategies, and industry analysis in a transparent and honest manner with integrity and consistency.

TPP: Not all doom and gloom for Vietnam’s beef industry

The greatest impact for the US beef industry brought about by the proposed Trans Pacific Partnership (TPP) is expected to be in Vietnam and Japan, according to US beef industry experts.

They say this result comes about because the US already has free trade agreements with Canada, Mexico, Australia, Peru, Chile and Singapore, and import duties on US beef are already zero in New Zealand and Malaysia,

Vietnam is currently a relatively small but promising market for US beef they say, citing US official statistics that show in 2014 US beef exports to the Southeast Asian nation totalled just 2,869 metric tons valued at US$22.1 million.

For comparison purposes, those same statistics reveal shipments to Japan, the leading market for US beef and beef variety meat exports in 2014 totaled 241,129 metric tons valued at US$1.6 billion.

The pace of US consignments to Vietnam has picked up momentum in the eight months leading up to September with the cumulative year-to-date totals reaching 2,444 metric tons valued at US$19.8 million.

Vietnam’s current duty rate for frozen muscle cuts is 20% and its rate for offal (organ meats) is 15%. Under the TPP, Vietnam’s tariffs will be phased out over a three to eight year period.

But the experts say it is important to note that through a regional free trade agreement, Australia and New Zealand already have reduced tariffs for beef entering Vietnam, with duties on muscle cuts and offal set for elimination by 2018 and 2019, respectively.

No one really thinks that Vietnamese beef ranchers could compete in a post TPP world with US or Australian raised beef in the short-term and it would be pure folly to suggest that they could.

Both American and Australian beef benefit tremendously from decades of genetic technologies and selective breeding the experts say, concepts barely heard of in Vietnam, much less practiced.

“The Vietnam beef industry will face a vast number of challenges should the TPP be ratified,” said Minister Cao Duc Phat of the Ministry of Agriculture and Rural Development at a recent meeting in Hanoi discussing the trade accord’s potential impact.

Minister Phat said the strategy to develop the beef industry must undergo a thorough overhaul in order to be able to survive the competitive challenges stemming from the pact.

But it certainly doesn’t follow that the TPP spells the death knell for beef industry by any stretch of the imagination say leading US experts— as smallholders in the US market compete quite effectively with their larger counterparts.

The fundamental problem the Vietnam beef industry faces is an emphasis on – quality –  which can be improved by implementing the same technologies currently employed by US and Australian ranchers.

Hoang Anh Gia Lai (HAGL) Joint Stock Company is a prime example of doing just this.  Earlier this year HAGL marked a turning point in the beef industry in Vietnam with the establishment of a ranch in Gia Lai Province following Australian ranching methods.

Company officials have also announced plans to import breeding stock from the US to supplement their Australian stock for their ranches and expect to have the first feeder cattle hitting the market in 2017.  

VN, India businesses to strengthen co-operation

Vietnamese and Indian businesses came together for a recent seminar to further exchange information and seek partnerships.

Organised yesterday in Ha Noi by the Viet Nam Chamber of Commerce and Industry (VCCI), the event saw the participation of 15 Indian companies.

Addressing the function, VCCI Vice President Hoang Quang Phong said that India is a big trade partner of Viet Nam, with two-way trade hitting US$5.6 billion in 2014. Indian businesses have so far poured about $300 million into 87 projects in Viet Nam.

Vietnamese businesses hope to receive technological support from India in the fields of tea processing, mining, information technology and heavy industry, which are India's strengths, he said.

With ongoing structural reforms and a Government committed to global growth, Phong said there has never been a better time for Indian businesses to invest in Viet Nam, as there is tremendous untapped potential.

Indian businesses stated that India is a market of great potential and demand, but bilateral trade and investment co-operation has yet to match both sides' potential and meet aspirations.

At the seminar, Indian firms operating in food processing, environmental pollution control, electronics, pharmaceuticals and mechanical engineering expressed their wish to study the Vietnamese market.

Secretary General Vijay Shah of the India Import-Export Club acknowledged that trade and investment has not reached its fullest potential.

He said the purpose of the visit to Viet Nam is to give Indian businesses the chance to learn more about existing opportunities, legal regulations and Vietnamese business trends in order to study and invest in some new projects in Viet Nam.

This was a long-term target supported by the two Governments with strong determination from the Indian business community. The parties said co-operation is especially important as Viet Nam prepares to establish the ASEAN Economic Community (AEC), and India is actively implementing its policy by working towards India's "Look East Policy", which envisions more vigorous strategic engagement with the economically vibrant Southeast Asian region, including Viet Nam.

Major export items of Viet Nam to India include computers, electronics, components, mobile phones and parts, automobile spare parts, rubber, chemicals, coffee, pepper, fiber and wood.

Meanwhile, the main items imported into Viet Nam from India are machinery and components, pharmaceutical products, cotton, corn, steel, livestock and petrol.

Vietjet offers 500,000 cheap tickets online Black Friday

To welcome “Online Black Friday”, Vietjet gives away more than 500,000 tickets just from VND0.00. The promotion, which runs from December 03rd, 2015 to December 05th, 2015, is applied for tickets on all domestic routes and international routes connecting to Seoul, Taiwan, Singapore, Bangkok and Yangon. Travel period is from December 10th, 2015 to May 20th, 2016 (exluding holidays).

Tickets can be booked at www.vietjetair.com (also compatible with smartphones at www.m.vietjetair.com) or at www.facebook.com/vietjetvietnam (just click the “Booking” tab). Payment can be easily made with Visa, MasterCard, JCB, American Express, and ATM cards issued by 24 Vietnam banks that have been registered with internet banking.

 “Apart from our aviation services, Vietjet is also planning to offer passengers around the world value-added goods and services via advanced online shoping applications. Online Friday is great opportunity to enhance market’s online consuming demand.”, said Mr. Desmond Lin – Vietjet’s Director of Business Development.

Samsung R&D centre hitting stride

The Samsung Vietnam Mobile Research and Development Centre (SVMC) in Ha Noi has contributed around 10 per cent of software market share used in Samsung's smart phones and tablets globally.

The SVMC has implemented about 360 projects of which 40 are globally used solutions while the remaining commercialised software projects belonged to the centre.

Do Duc Dung, head of the SVMC's project management office told media yesterday that SVMC is the largest Research and Development (R&D) centre in the Southeast Asian region. Samsung has 25 R&D centres specialising in research for its phones worldwide.

Established in February 2012, the centre has provided software for Samsung's smart phones and LTE network suppliers in the Southeast Asian region, Australia and New Zealand.

Over the past eight years, Viet Nam has become the group's largest production location as its total committed investment is up to US$14.2 billion poured into Bac Ninh, Thai Nguyen provinces and HCM City. In addition, more than 30 per cent of Samsung's mobile phones sold worldwide are produced in Viet Nam.

The SVMC has over 1,500 employees who include just five foreign nationals. It can be seen that Samsung has striven to transfer technologies to Viet Nam as per its commitment. Samsung planned to increase the number of staff at the centre to 2,600 by the year of 2018, Dung said.

He affirmed that capacity and skills of staff at the centre could be equal to its R&D centres in the world.

"Ninety per cent of engineers at the SVMC attain Samsung's standards worldwide. Engineers in Viet Nam and India are given the highest valuation from the parent company," Huh Chang Wan, the centre's vice president said.

He said the centre also worked with other R&D centres to train their personnel.

However, the quality of human resource in Viet Nam has been a stumbling block not only for Samsung but for other foreign investors as well.

Do Ngoc Trong, an engineer at the centre said that the knowledge of the Vietnamese employees is not lower than that of other countries. They just lack communication and other soft skills.

Graduate students do not have much experience in working at the SVMC. The centre often imparts at least six months training to students for them to be eligible to work there.

The centre has not only been in charge of the Southeast Asia, Australia and New Zealand markets, but also participated in several Samsung's global projects such as electronic S Pen for Note and Galaxy smart phones.

It said it had completed 10 software projects serving the Southeast Asian region in the first year of operations. By the end of this year, it is expected that around 10 software projects would be completed.

Last year, the SVMC had only three patents, but the number increased to 10 in the first half of this year.

Wan said the SVMC was looking to expand its market and join Samsung's global projects. It would produce advanced technologies and look to new global trends.

The centre would also employ several thousand people for its R&D activities in the future.

VN firms urged to use Big Data technology

Leaders of 400 Vietnamese enterprises heard Apple's co-founder Steve Wozniak speak about the latest information technology trends and the importance of cloud computing and use of Big Data in today's global business environment at a conference held yesterday in HCM City.

In the digital era, enterprises with updated technologies will have an advantage in competitiveness, he said.

But the technology system of Viet Nam is still low compared with other countries in the world, according to a report from World Bank.

This has hindered Vietnamese enterprises from taking advantage of opportunities to participate in projects invested in by foreign companies.

In recent years, however, more Vietnamese enterprises have started using cloud computing and Big Data in their businesses.

Speaking at the SMAC (Social – Mobile – Analytics - Cloud) 2015 conference organised by Mobifone for the first time in Viet Nam, Wozniak said that the cloud would develop quickly as more and more people use mobile devices that can access data anywhere in the world.

Information technology continues to have a profound effect on people's lives, with vast internet penetration worldwide, allowing people across the globe to interact on any topic.

Le Nam Tra, chairman of Mobifone, said that his company wanted to ensure that the Vietnamese enterprise community would stay connected with the latest technology.

This would create a revolution in management and business operation in Viet Nam, he said.

Internet subscriptions and mobile devices have empowered enterprises and customers as more work is being done online, according to audit, tax and advisory firm KPMG.

Viet Nam has 39.8 million internet users. At least 44 per cent of them use ADSL. There are 32.4 million users of the internet on mobile devices in the country.

20% ceiling interest rate question remains open

The Civil Code (revised), adopted by the National Assembly on November 24, states that negotiated interest rates must be controlled under 20 per cent per year, excluding loans stipulated in other laws.

Delegates at the recently held 10th session of the 13th National Assembly voiced their support for a maximum fixed interest rate of 20 per cent per year, as stipulated in the Civil Code.

They also approved several matters discussed by members of the National Assembly Standing Committee relating to banks' interest rates, as mentioned in paragraph 1, Article 468 of the Civil Code.

Accordingly, the negotiated interest rate should not exceed 20 per cent per year, excluding those loans stipulated in other laws or regulations.

Dr Cao Sy Kiem, former governor of the State Bank of Vietnam (SBV), said many National Assembly deputies voted for a fix interest rate of 20 per cent, as stated in the Civil Code. This would help avoid fraud on the "black" credit market that often saw heavy rates and brought negative consequences for the society, Kiem said.

The former SBV governor said the 20 per cent rate would be applicable to all loans, excluding those stipulated by relevant laws that have different regulations. This means credit organisations operating in accordance with the Law on Credit Organisations and the Law on the State Bank of Vietnam will not be affected by the latest adjustment on the 20 per cent rate as regulated in the Civil Code, but will be affected by the Law on Credit Organisations.

Therefore, he said, credit organisations could set interest rates through negotiations with partners and customers. However, in some special cases or in emergencies, the central bank can make immediate requests to control the market promptly in line with the Law on the State Bank of Vietnam.

Kiem said it was essential to implement the ceiling interest rate of 20 per cent when banks operated well and businesses gained a lot of trust. Otherwise, when the negotiated rate surpasses 20 per cent per year due to certain factors such as inflation, natural disasters, epidemics and war, it may lead to sudden high demand for loans.

Earlier, on October 24, National Assembly deputies proposed a plan on the ceiling interest rate that did not mention any exceptional cases as stipulated in other relevant laws. After that, they agreed on adjustments to Article 468 of the Civil Law in line with practical conditions.

Dr Nguyen Tri Hieu, a leading banking and finance expert, said the ceiling interest rate should be controlled. The rate should be adjusted in line with market changes, rather than setting a fixed rate of 20 per cent per year, and in accordance with real operations of credit organisations and deposit rates, as well as expenses on loans.

In addition, the rate margin should be carefully calculated due to risks in credit organisations' operations. For example, when the deposit rate is about 11 per cent, loan expenses are about nine per cent, the risk management rate is two per cent, and bank's profit is at least three per cent, the real ceiling rate must rise to more than 20 per cent.

Hieu said, "When the risk of credit organisations' operations is high, the margin of interest rate should be expanded. In some cases, the margin of interest rate may reach 10 per cent or even higher."

According to Hieu, it is necessary to encourage the participation of all economic sectors and banks in identifying risks and setting interest rates based on loan expenses. The fixed ceiling rate of 20 per cent per year may prevent banks from launching credit packages with more risks.

However, Hieu also said all participants must obey the law. Relevant agencies such as the justice ministry, the National Assembly Office, the State Bank of Vietnam, and the court, should issue more specific documents and guidelines on the implementation of the Civil Code in a transparent manner and in accordance with the market mechanism of credit organisations, thus stabilizing interest rates and promoting the development of the financial and banking system.

Hieu's opinion was shared by Truong Thanh Duc, chairman of the Vietnam Banking Association's Legal Club, who said the adjustment of the fixed ceiling rate at 20 per cent per year was a positive sign that would ensure transparency in the local credit market.

Duc said he supported further hike of the ceiling rate to more than 20 per cent per year, even to 30 per cent or 50 per cent in some special cases.

Integration requires reforms: minister

There needs to be more improvement on administrative reform and anti-corruption work for Viet Nam to integrate into the world economy, said Minister of Planning and Investment Bui Quang Vinh at the one-day Viet Nam Business Forum (VBF) 2015 held in Ha Noi yesterday.

Vinh shared his opinion to about 500 local and international participants who attended the VBF to discuss ways to improve local competitiveness.

The forum, organised three times a year, was hosted by the International Financial Corporation (IFC), Ministry of Planning and Investment (MPI) and the Viet Nam Chamber of Commerce and Industry (VCCI).

Minister Vinh said that although the business and investment environment and administrative procedures were improved, the enforcement of them remained weak, showing the low competitiveness of the economy.

According to him, the MPI has recently issued six decrees and three circulars to guide investment and enterprise laws.

The minister said FDI enterprises in Viet Nam had grown strongly while local enterprises were not that strong. He urged for co-operation and linkages between the two sides for the best result of development.

Also, VCCI Chairman Vu Tien Loc appreciated the general institutional reforms of the local Government, he still thought they did not meet the expectations of businesses yet.

A VCCI survey showed that complicated administrative, customs and tax procedures were still barriers to private enterprises, especially the bigger one. Loc said the bigger and more successful the local companies were, the more frequent and heavier administration checks they had, thus, some enterprises had reshaped themselves to be smaller for a better working result.

As a result, Loc said, it led to a growing number of small and super small enterprises in Viet Nam.

Meanwhile, Viet Nam is joining the ASEAN Economic Community (AEC), and the future Trans-Pacific Partnership (TPP) and signing more negotiations for free trade with other countries where bigger companies will have more chances to gain.

Minister Vinh said it was necessary to have an improvement of the legal system to support local enterprises, to enhance competitiveness.

Addressing the forum, VBF co-chairman Virginia B.Foote, praised the significant progress in many important issues made for the business community, particularly in the negotiation of TPP in October. However, she thought there should be more improvement made on anti-corruption, administrative reform as well as direct cash transactions between enterprises.

Meanwhile, American Chamber of Commerce Chairman Sherry Boger said: "Viet Nam has succeeded at attracting FDI and increasing trade. The trade between Viet Nam and the USA will likely reach over $45 billion in 2015, another annual increase of over 20 per cent."

She added that it was expected to reach $80 billion by 2020 or higher after TPP takes effect.

However, she saw very few Vietnamese firms in global supply chains and the corruption rate was still high.

She suggested a limit on cash transactions but further electronic transactions as one way to fight with the corruption in Viet Nam, while an efficient customs administration and trade facilitation is essential for local firms to join global supply chains.

A representative of the Australian Chamber said the local laws of investment and enterprise complied with comments from investors and enterprises were good moves but those laws would have no use without decrees and circulars for the implementation.

To boost the local enterprises, VCCI Chairman Loc said local private enterprises should seek to co-operate with big multi-national companies. Loc said to be in the global value chain, enterprises must work transparently and with innovation while the Government should support them with favourable policies.

Kyle F. Kelhofer, regional director of IFC thought Viet Nam should promote the innovative business sector to foster the global value chain.

Also attending the forum, Viet Nam Deputy Prime Minister Vu Van Ninh, said the World Bank's Doing Business 2016 report moved Viet Nam up three notches in the ranking, from 93rd last year to 90th position. He said Viet Nam could reach gross domestic product growth of 6.4 per cent this year, adding that the result could not be reached without support from local and foreign investors.

Ninh said the Government would open more to hear their voices, adjust the policies to make their work better and to contribute to overall development.

Although the bad debt ratio was still high, Viet Nam was on track to reform and to have a healthy financial system, Kyle said.

On agriculture development, Kyle said cheap labour and natural resources were being used to exhaustion, so the country should have more private participants in agriculture.

At the forum, Tomaso Andreatta, vice chairman of Euro Chamber, said the country should foster the Public Private Partnership for infrastructure as it played the key role in developing the economy, and cut the cost of production and businesses.

Visas were also an issue mentioned at the forum. AusCham said Viet Nam has visa exemption for citizens of 21 countries. It was lower than in neighboring countries such as Malaysia with exemption for 164 countries, the Philippines with exemption for 157 countries and Thailand with exemption for 52 countries.

Tran Van Du, deputy director of immigration management department, Ministry of Public Security said that all the recommendations would be reviewed

The forum also mentioned issues related to trade, investment, banking, capital market, agriculture, education and training, infrastructure and governance transparency, considering them key issues for local development.

Stable growth continues in retail

Vietnamese retail revenue continued to rise during the first 11 months of this year, reaching VND2.95 quadrillion (US$134 billion), a year-on-year increase of 9.4 per cent.

With price increases excluded, the rise was in fact only 8.3 per cent, according to the General Statistics Office (GSO).

In the last 11 months, all four retail goods and services saw an increase over the same period last year. The retail sector taking the lead accounted for 76.2 per cent of the total retail sales, bringing in revenue of $102 billion, or an increase of 10.7 per cent.

It was followed by retail sales in accommodation, restaurant and catering services accounting for 11.5 per cent of the total, posting a revenue of $15.353 million with an increase of 4.6 per cent.

Other service sectors including weddings, funerals, and spa and beauty, accounted for 11.4 per cent, bringing total revenue of 6.9 per cent, while the tourism sector accounted for 0.9 per cent of the total retail sales.

GSO expert Vu Manh Ha said that total retail sales reflects the improvement of purchasing power and stable growth due to falling prices in some consumer goods and many promotional programmes offered by supermarkets.

In addition, the commercial management and price stabilisation policy offered by the State have been effectively deployed to contribute a part in stabilising the market in the remaining months of the year, Ha said.

According to the GSO, the total retail sales may improve sharply in the last months of the year due to the high consumption months with many festivals and holidays.

Housing market recovery helps property firm shares

The revival of the housing market has had a positive impact on the prices of shares of property companies, according to the Vietinbank Securities Company.

Dang Tran Hai Dang, the company's research and analysis deputy director, told a seminar on an overview of the real estate market and investment opportunities that most shares in the sector had outperformed the VN Index in the past three months though they gave up some of the gains in November when the market retreated.

In the past six months, the property sector accounted for the highest trading value, with 18.7 per cent of the total.

In terms of market capitalisation, the sector accounted for 12 per cent, second only to banking.

But Dang pointed out that in the first nine months of the year almost 40 per cent of the listed real estate companies saw profits fall while 22.4 per cent suffered losses.

In the short term investors should consider companies with projects at strategic locations, like near the railway route in Ha Noi, the metro lines in HCM City, and ports, airports and beach resorts in Da Nang, Nha Trang, and Phu Quoc.

However, they should be financially capable of ensuring the completion of their projects.

In the long term they should look for companies with lands in key areas and strong financial capacity, among others, he said.

Le Hoang Lan Nhu Ngoc, senior manager at property consultancy CBRE, said the lower interest rates on mortgages and their longer tenures of up to 25 years and higher household incomes were factors behind the market revival.

Improved infrastructure and laws were also lending a helping hand, she said.

In HCM City, more than 10,100 new apartments were sold last quarter, three times the number from a year earlier.

Resort projects in coastal areas were attracting a lot of interest from buyers, she said.

She expects the recovery of the property market to continue next year thanks to positive factors like Viet Nam's connection to the world through free trade agreements and the TPP as well as the more favourable regulations on mortgages and housing ownership by foreigners.

Auto distributor calls off share issue plan

Truck distributor Hoang Huy Investment Services Co (HHS) won't be issuing 30 million to 60 million shares to dealers, as it has arranged capital for developing car service centre systems.

"Positive business growth of the company in 2015 has helped ensure funds to develop the service systems without the need of seeking new capital," the company said in a statement on its website.

The company hoped its dealers would save these investments to develop the business and boost sales, it said.

According to the plan approved on June 25 this year, the company would issue additional shares of between 30 million and 60 million shares to its sole agencies to raise investment capital to expand the car service centre systems nationwide.

However, the auto distributor decided to put off the plan after it arranged sufficient capital and brought several service centres into operation.

Hoang Huy Investment Services Co is the biggest listed auto company with market capitalisation of almost VND3.64 trillion (US$162.5 million).

It posted encouraging business results in the nine months of this year, following which its total sales reached nearly VND2.8 trillion ($125 million), while net profit touched almost VND417 billion ($18.6 million), a rise of 228 per cent and 521 per cent, respectively, over the same period of last year.

It was no surprise that the share price followed suit, having climbed 34.5 per cent from VND11,600 a share on January 5 to VND15,600 on December 1.

The company's shares have been declining for four of the last six sessions while closing unchanged in the other two days, driven by concerns that new import duty levied on trucks by the Ministry of Finance would negatively affect its future earnings.

According to Circular No 163/2015/TT-BTC dated November 5, 2015, amending preferential import tariffs on automobiles and components, duty on imported trucks will increase from December 20 this year.

Import duty imposed on trucks with loading capacity more than 10 tonnes, but not exceeding 20 tonnes, will increase from 30 per cent to 50 per cent, the models with the maximum load of over 20 tonnes, but not exceeding 24 tonnes, up from 20 per cent to 50 per cent.

Taxes for dedicated trucks including waste collection vehicles, cement tank trucks or mud trucks, will see a smaller increase from 15 per cent to 20 per cent.

According to research study conducted by Saigon Securities Inc, this new import duty scheme would have an adverse impact on the Hoang Huy's business, which specialises on medium and heavy imported trucks, as well as the company's share prices.

Price of cooking gas hiked by VND16,000

The cooking gas price in this city has been hiked by VND16,000 (US$0.7) per 12kg canister from yesterday.

The retail price of a 12kg cooking gas canister now ranges between VND308,000 ($13.6) and VND310,000 ($13.7).

Gas firms attributed the price increase to the rising world gas price, which is $467.5 per tonne now, a surge of $52.5 per ton in comparison with last month.

This is the third hike in a row of gas prices since early September, adding a total of VND43,500 ($1.9) to the price.

In early November, the cooking gas price increased by VND17,000 ($0.75) per 12kg canister due to the rising global gas price.

Binh Duong receives $1.7b of FDI since early 2015

Some US$1.7 billion in foreign direct investment (FDI) has been poured into southern Binh Duong Province since the beginning of 2015, surpassing the yearly target by 70 per cent and up 11.1 per cent year-on-year.

According to the provincial People's Committee, the province licensed 176 new FDI projects during the period, worth $966 million, and $734 million was added to 113 operational projects.

Chief among these is a $274-million textile project run by Far Eastern Polytex Vietnam, a member of Taiwan's Far Eastern Group, in Bau Bang Industrial Park. Another is a $50-million Samoa wood factory in the Thanh An industrial cluster.

An extra $130 million was pumped into the Vina Kraft Paper Ltd Co in Ben Cat district. The Chanh Duong Paper Ltd Co added more $74 million in investment.

Binh Duong is now home to 26 industrial parks, covering a total area of 8,800 hectares. The locality plans to attract $1.4 billion in FDI in 2016.

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