Equal, transparent climate necessary for SMEs: PM

Prime Minister Nguyen Xuan Phuc has underscored the need to create an equal and transparent climate in order to facilitate the operation of small-and medium-sized enterprises (SMEs).

Speaking at the third national congress of the Vietnam Association of SMEs (VINASME) in Hanoi on December 3, the PM urged the association to work with its members to expand their share in the domestic market, stretch their reach abroad and join global production, supply and distribution chains, thereby contributing to agricultural restructuring and rural economic development.

Calling on firms to operate with integrity and avoid abetting negative phenomena, the government leader affirmed that the Party and State always pay special attention to building and developing the Vietnamese business community.

The Government has been making efforts to build a growth-facilitating government that serves people and businesses, while encouraging start-ups and creating all the best possible conditions for enterprises, he said.

Business representatives at the congress expressed their support for the PM’s message and hailed the Government’s drastic actions to remove difficulties and obstacles for production and business activities.

SMEs account for over 97 percent of the country’s total businesses, and have significantly contributed to economic growth and job generation.

They have contributed about 40 percent of the national gross domestic products (GDP), 33 percent of industrial production value and 30 percent of export revenues, and employed around half of the national workforce.

Vietnam-Argentina trade reaches 2.42 billion USD in 10 months

Two-way trade between Vietnam and Argentina reached 2.42 billion USD in the period from January to early November this year, it was reported at the fifth meeting of the Vietnam-Argentina Inter-Governmental Committee in Hanoi on December 2.  

Deputy Minister of Industry and Trade Do Thang Hai and Argentine Ministry of Foreign Affairs and Worship’s Secretary for International Economic Relations, Ambassador Maria Cristina Boldorini co-chaired the event. 

According to the Ministry of Industry and Trade’s report, the two-way trade value showed a 13.1 percent rise from last year. Vietnam earned 302.3 million USD from exports to Argentina as of early November and spent 2.12 billion USD on imports from the Latin American country, up 15.8 percent. 

The figure is estimated at nearly 3 billion USD this year. 

Argentina is currently investing in four projects worth 3.2 million USD in Vietnam, ranking 80th out of 112 countries and territories investing in the country. 

Deputy Minister Hai said a number of commitments have been delivered in the fields of trade, investment, agriculture, culture, health care, legal medicine and science-technology since the fourth meeting in 2014. 

The two sides signed a food safety control agreement in June 2014, under which 206 Vietnamese seafood processors were allowed to export to Argentina while 36 Argentine meat producers and 221 seafood processors gained access to the Vietnamese market. 

Hai also spoke highly of joint efforts to implement technical cooperation projects within the framework of the South-South and Triangular Cooperation Fund of Argentina. 

At the meeting, the two countries agreed on 11 quarantine certificate samples for Argentine animal products, including frozen beef and lamb, milk and dairy products. 

Vietnam is working to export dragon fruit, longan, litchi and mango to Argentine market while Argentina has also applied for exporting orange, lemon, blueberry, apple, grapefruit, tangerine, pear and sweet cherry to Vietnam.

Jetstar Pacific opens Da Nang – Taipei direct air route

The low-cost airline Jetstar Pacific officially inaugurated its direct air route connecting Da Nang city in central Vietnam to Taiwan’s Taipei on December 2.

It is Jetstar’s first direct air route between Vietnam’s central region and Taiwan.

The airline uses Airbus A320 on the route with three two-way flights each week on Tuesday, Friday and Sunday and is capable of serving 51,000 passengers per year. 

The move is part of the airline’s plan to expand its services in northeast Asia. 

In the first nine months of 2016, 382,000 Taiwanese visited Vietnam, up 16 percent year on year. 

On the occasion, Jetstar Pacific opened the sale of 11,000 tickets priced from 11,000 VND applicable to 16 domestic routes from December 2-4.

Jetstar Pacific is a member of Jetstar Group, a leading low-cost air brand in the Asia-Pacific and is operating 46 flights each week to Taipei from Singapore and Japan, connecting with Jetstar Pacific’s 34 domestic and international routes.

Thai fair organisers woo VN firms

Ten leading Thai exhibition organisers came to Hanoi on December 2 for a business-to-business forum to meet Vietnamese enterprises, trade promotion organisations and associations.

The forum, organised by the Thailand Convention and Exhibition Bureau (TCEB), is a new form in the Connect Business campaign of TCEB. The bureau hopes the campaign will attract Vietnamese businesses to Thailand to attend exhibitions by strengthening relationships with organisations, associations, chambers of commerce, unions and non-profit corporations.

“Vietnam has high potential with a large number of visitors to Thai fairs in past years. Through this event, I want to give information about meetings, incentive travel, conventions and exhibitions (MICE) and the benefits that Vietnamese companies can get from attending these events in Thailand,” said Jaruwan Suwannasat, director of TCEB Exhibition and Event.

Thailand expects to welcome 208,000 international trade visitors this year, creating a total value of 500 million USD and will continue to support businesses which want to expand their activities in Thailand.

Statistics show that Vietnam is the sixth largest visitor to exhibitions in Thailand with 4.4 percent of the total in 2014 and 6.5 percent in 2015. Thus, Vietnam is an important market for Thailand, the director emphasised.

Vietnamese visitors show most interest in food and agriculture, followed by cars and health and medicine, according to TCEB statistics.

TCEB suggest suitable exhibitions for Vietnamese enterprises include food and agriculture; cars and automation; infrastructure and construction and warehouse, transportation and logistics.

A representative of Reed Exhibitions, the organiser of in-cosmetics Asia exhibition, said that Vietnamese visitors to the fair continued to grow in the past five years.

As the cosmetics sector is booming, Vietnamese companies are facing challenges in competition from big, global companies. As well as catching global trends, they came to the fair to seek safe ingredients and to join education programmes and seminars, she said.

HCM City’s economy keeps growing in 11 months

Ho Chi Minh City’s economy continued to expand in the period from January to November with services and trade being major growth engines, according to the municipal People’s Committee.

In the last 11 months, total retail sales and services revenue approximated 639 trillion VND (28.1 billion USD), a year-on-year rise of over 9 percent, Director of the municipal Department of Planning and Investment Su Ngoc Anh said at a regular meeting of the city administration on December 2.

He noted activities to promote investment promotion and improve the local investment climate have proved effective when domestic and foreign capital kept pouring into the city. 

While nearly 33,000 businesses were set up with total charter capital of more than 266 trillion VND (11.7 billion USD), 729 FDI projects worth 831.8 million USD were provided with investment registration certificates during the period.

Enterprises based in HCM City exported some 28.8 billion USD worth of goods, up 5 percent from a year earlier. Excluding crude oil, total value of overseas shipments is estimated at 26.5 billion USD, rising by 10.4 percent, the People’s Committee reported.

The industrial sector grew by some 7.23 percent in the 11 months, compared to the same period of 2015. Particularly, the four key industrial sectors (mechanical manufacturing, electronics, chemical-rubber-plastics, food processing) increased by 7.36 percent.

The southern city posted tourism revenue of over 89.69 trillion VND (3.9 billion USD) from January to November, up 7.23 percent from the previous year. It also recorded 4.58 million international arrivals, climbing 14 percent.

Chairman of the municipal People’s Committee Nguyen Thanh Phong said the administration will press on with measures to support enterprises and better the business climate in the time ahead.

HCM City aims for 50,000 new businesses to be established in 2017.

Vietnam expects GDP growth rate at 7.1-7.3 percent in Q4

Vietnam’s economy will continue the recovery trend with a GDP growth rate forecast at 7.1-7.3 percent in the fourth quarter of 2016, according to the General Statistics Office (GSO).

Accordingly, the economy is set to remain attractive to FDI and enjoy an increase in exports. A big portion of overseas remittances will be poured into economic activities while there will be a surge in the number of new businesses and their charter capital.

Those growth momentums will have positive impacts on the labour market, the GSO and the Ministry of Labour, Invalids and Social Affairs said in their latest report on the labour market announced on December 2.

The report expects the workforce in Q4 to expand slightly, 0.2 percent, from a year earlier, while the number of labourers with at least three-month training will rise by 4-5 percent. The unemployment rate among the working-age population is predicted at about 2.2 percent.

Looking back to Q3, the agencies noted improvements in the labour market such as an increase in the rate of trained labourers, a decline in the proportion of workers in the agro-forestry-fishery sector in the total workforce, and salary earners’ higher income.

However, economic growth did not generate many jobs and the unemployment rate still rose in the last three quarters, they added. 

In Q3, 68.09 percent of the workforce worked in rural areas, dropping slightly from Q2 and a year earlier. The figure for the industry-construction sector climbed 0.4 percent and for the services sector, 0.1 percent, compared to the three-month period through June. 

More than 1.1 million people of working age were idle in Q3, up 29,000 from the previous quarter but down 11,000 from the same period of 2015, data show.

Quang Ninh attracts over 30 trillion VND in investment so far

The northern province of Quang Ninh has attracted more than 30 trillion VND in investment so far this year, a rise of 30.4 percent year on year.

The amount included 17.8 trillion VND from domestic investors and 567.3 million USD in foreign direct investment (FDI) from more than 20 countries and territories. 

The province is hosting 117 valid FDI projects worth a total 5.5 billion USD.

This is the result of the locality’s efforts in applying strategic measures to promote investment, including the improvement of transport system as well as local competitiveness and investment environment.

Provincial authorities have held quarterly, monthly and weekly meetings with the local business community to hear and timely address arising problems, while all provincial agencies have cut down 30 percent of their meetings to give more time for businesses.

Businesses can also give their ideas on regulations and policies in attracting investment and socio-economic development plans.

In addition, Quang Ninh has offered legal support and other assistance in terms of capital, land and trade promotion for enterprises, with special attention paid to small- and medium-sized enterprises which account for 98 percent of all the firms in the province.

At the same time, the province has also made efforts to speed up administrative reform through the building of a public administrative centre, helping reduce 40 percent of businesses’ time for administrative procedures.

Along with the support, the locality has renewed investment promotion work towards professionalisation, practicality and efficiency.

Thanks to the endeavours, Quang Ninh has won trust of investors with many big projects, including Texhong Hai Yen fibre factory in Mong Cai and Vinpearl Ha Long Bay Resort in Ha Long City.

Investment promotion activities abroad as well as cooperation with international organisations have been strengthened to introduce the locality’s potential and policies.

Quang Ninh has sent working groups to many foreign markets, including Malaysia, Singapore and Taiwan to organise investment promotion activities and establish ties with potential partners and investors.

RoK firms see Vietnam as potential market

Industrial and agricultural firms from the Gyeongsangbuk province of the Republic of Korea see Vietnam as a great potential market for their products, according to the province’s Vice Governor.

Addressing a trade seminar in HCM City on November 2, Vice Governor Woo Buyng Yoon said Gyeongsangbuk province is the largest farm produce granary in the RoK with around 200 kinds of products.

Woo said Vietnam attracts RoK firms as the country has one of the highest growth rate in Southeast Asia region, along with a big population is big and fast growing consumption demand. 

Vietnam can also be a gateway to other countries in the ASEAN region, he said.  

Nearly 30 RoK firms operating in agricultural products, health food, and cosmetics introduced their products at the seminar and answered questions from Vietnamese enterprises to seek import partners and distributors.

Tran Ngoc Liem, Deputy Director of the Vietnam Chamber of Commerce and Industry (VCCI)’s office in HCM City, said RoK products have both high quality and attractive packaging. 

Products from the RoK will help diversify goods in Vietnam, putting pressure on Vietnamese enterprises to reform technology, improve quality and boost competitiveness of Vietnamese goods, Liem added.

In recent years, Vietnam-RoK trade exchange has grown strongly with two-way trade value expected to hit 40 billion USD in 2016.

New oil reserve found in Bach Ho well

A new oil reserve was found in Bach Ho-47 (BH-47) well, announced the Vietnam Oil and Gas Group on December 1.

The Vietnam-Russia Oil and Gas Joint Venture Vietsovpetro discovered the oil reserve while exploiting BH-47 on November 30. It is expected to generate output of more than 610 cubic metres of oil and 110,000 cubic metres of gas a day, according to Quan Doi Nhan Dan (People’s Army) newspaper.

Upon completing trial drilling, oil well BH-47 will be reserved for future use.

The discovery of a new oil reserve shows the potential for gas and oil exploration in the north eastern area of Bach Ho well of the Cuu Long oil field in Vietnam’s continental shelf.

Hanoi promotes trade links with localities nationwide

A conference aiming to boost trade links between Hanoi and other localities was held in the capital on December 1.

According to Chairman of the municipal People’s Committee Nguyen Duc Chung, Hanoi has connectivity with Bac Giang, Ha Giang, Thai Binh, Hung Yen, Hai Duong and Son La in the north, the central province of Binh Thuan and the Central Highlands province of Lam Dong and the 13 southwest localities.

As a market with high purchasing power, Hanoi has modern infrastructure for commercial development in the country, with 21 shopping centres, 118 supermarkets, 454 markets, over 600 convenient stores and over 50 farm produce and food stores. 

It is an emerging retail market, ranking 13th in the list of the 19 most crowded retail markets in the world. 

According to the municipal Department of Industry and Trade, Hanoi organised 400 enterprises to join programmes to boost consumption, and signed over 350 memorandums of understanding and economic contracts with outside-city enterprises, contributing to stablising the market and meeting the demand of residents.

Nguyen Thi Mai Anh, Deputy Director of the Hanoi Investment, Trade and Tourism Promotion Centre, said producers in many localities have yet to design packages and stamps for their products, stressing that this is necessary to sell products in modern distribution systems. 

The centre had to ask enterprises and producers in other localities to pay heed to the issue, she said. 

Nguyen Van Son, Chairman of the Ha Giang province People’s Committee highlighted the importance of building geographical instructions for commodities to improve competitiveness of Vietnamese goods in the context of integration. 

He suggested the Ministry of Industry and Trade consider establishing an e-commerce portal for farm produces. 

The ministry needs to build a mechanism to share and provide information related to goods among industry and  trade management agencies, and enhance trade promotion to link goods suppliers and contributors. 

Localities were urged to build and perform programmes of clean and high-quality goods production and supply, towards meeting the demand of Hanoi consumers, while municipal authorities were asked to make it easy for localities’ goods to access the city.

SMEs urged to invest more in technological innovation

All enterprises, including small- and medium-sized enterprises (SMEs) are responsible for developing and applying technology, and the business circle must be the centre of innovation, heard an international seminar in Ho Chi Minh City on December 1.

There are about 535,000 SMEs in Vietnam at present, accounting for 97 percent of the total business number. They contribute some 45 percent of the national GDP, 31 percent of total State budget revenue, and 35 percent of the business circle’s total investment capital.

Pham Ngoc Minh, an official at the Ministry of Science and Technology, said the rapid development of science and technology is shortening the “life cycle” of technology. Therefore, it is an urgent need for enterprises to innovate technology in order to meet production and market demand and ensure their competitiveness.

HCM City has continually taken the lead in Vietnam in terms of export value and GDP. It is also known as a sci-tech hub in the country.

However, 51 percent of the 700 surveyed companies based in 12 industrial parks and export processing zones in HCM City still use outdated technologies, according to the municipal Department of Science and Technology.

Tran Quang Thang from the Association of SMEs in the South said technological and technical obsolescence has resulted products of low value and inconsistent quality products while production costs are 10-30 percent higher than that of imports.

Total social investment in science and technology remains low, and up to two-thirds of that sum is from the State budget. In developed countries, the non-State sector’s investment in science and technology is usually higher than the State budget’s.

Vietnamese companies’ demand for sci-tech innovation is also not strong enough, Thang said, adding that it is necessary to encourage private firms to establish or cooperate with the State to set up venture capital funds for technology research and development.

In the Republic of Korea (RoK), big businesses and groups are ready to invest in science-technology, and they make up 70 percent of the total funding for science-technology each year. Instead of supporting big companies, the RoK is now prioritising assistance for SMEs in the application of new technologies.

Park Jun Ho, Director of the HCM City office of the Korea Institute of Industrial Technology (Kitech), said Kitech has many projects supporting businesses, especially SMEs, to develop technology.

Many research institutes of Vietnam are working with Kitech, and through this cooperation, Kitech can help local enterprises innovate and transfer technology while improving their competitiveness, he noted.

Wallonia parliament discusses Vietnam-EU FTA

The parliament of Wallonia, a region of Belgium, organised a discussion session on December 1 on the Vietnam-European Union (EU) Free Trade Agreement (EVFTA) at Namur city, the region’s capital city.

The discussion was an important step to prepare for the parliament and the government of Wallonia to appraise, review and give their opinions on the EVFTA.

Vietnam’s Ambassador to Belgium and head of the Vietnamese delegation to the EU Vuong Thua Phong attended and spoke at the session.

Phong stressed that the EVFTA is the first new agreement the EU negotiated and signed with a developing country and is a comprehensive, balanced and win-win agreement.

The ambassador highlighted the traditional friendship and cooperation relationship between Vietnam and Belgium in general and the Wallonia region in particular. He expressed his hope that the region will support the agreement.

Phong answered questions from MPs and affirmed Vietnam will continue with comprehensive reform and international integration, during which the country attaches importance to developing relationships with the EU and Belgium, including the Wallonia region.

High-end audiophile show hits Hanoi

Audio Visual Equipment Show 2016, December 2-5, has opened at the Hanoi National Convention Centre showcasing the very best in brands and latest technology from around the globe.

The show is a biannual event held in Ho Chi Minh City in September and Hanoi in December with the aim of introducing state-of-the-art ultra-high-end and full-range loudspeakers, amplifiers, latest ear headphones and 4D television.

With full-range loudspeakers like Raidho D-5.1, Triangle Magellan Grand Concert, Rockport Technologies Cygnus, the event attracted hundreds of audio buffs from across the country on opening day.

In addition, guests can experience the latest in audio equipment and speakers such as Legacy Audio Calibre, Voxativ The 9.87 System, Tannoy GRF 90 and Transrotor Tourbillon FMD, Thorens RD-550.

Gov’t moots law on bad debts settlement     

The Government is going to propose that the National Assembly formulates a separate law on settling bad debts to facilitate economic restructuring, Deputy Prime Minister Vuong Dinh Hue said on Thursday.

He told a cabinet meeting that handling bad debts was an urgent task for ensuring macro-economic stability and boosting socio-economic development.

However, the work done by Viet Nam Asset Management Company (VAMC), set up to process the bad debts of commercial banks, had not been effective enough, he said.

Company Chairman Nguyen Quoc Hung reported late October that since its establishment in 2013, the firm had bought non-performing loans worth VND262 trillion (US$11.85 billion).

However, it has only been able to recover around VND38 trillion, about 15 per cent of the loans purchased.

State Bank of Viet Nam (SBV) Deputy Governor Nguyen Kim Anh, said the lack of proper, consistent regulations for the company’s operations has caused the low ratio of debt recovery.

For example, as the VAMC deals with bad debts, borrowers might want to supplement their collateral with land-use rights. Yet notary agencies would not agree to notarise such a mortgage contract because, although the VAMC owned the debts, it was neither a lender nor a party that can accept land use rights as collateral under the Land Law 2013.

The SBV’s Circular No 19/2013/TT-NHNN enabled the VAMC to evaluate bad debts either by themselves or by hiring an independent institution, but the Finance Ministry’s Circular No 126/2015/TT-BTC did not specify the criteria for valuating debts.

VAMC and credit institutions cannot seize mortgaged assets if their owners intentionally resisted such seizure, because the national Civil Code (2015) has not stipulated the right of mortgagees to seize the assets.

Hue said the Ministry of Justice should start co-ordinating with relevant ministries and sectors immediately to kick-start the process for issuing a law on bad debt settlement.

The authorities would revise the Civil Code and laws on credit institutions, deposit insurance, tax management, corportate income tax, individual income tax and asset bidding, as part of this project, he added.

Hue asked the Ministry of Justice to formulate a decree to guide implementation of the Asset Bidding Law, and the Ministry of Natural Resources and Environment to complete a similar legal document on the Land Law regarding mortgaged assets settlement.

He also asked the Ministry of Construction to collaborate with the Ministry of Justice and the SBV to revise Decree 163 on transferring incomplete property projects not meant for business transactions in a way that facilitates VAMC operations.

The Ministry of Finance should issue criteria for asset valuation in the near future, and the Ministry of Public Security should co-operate with credit institutions and the VAMC in seizing mortgaged assets.

Hue also urged the People’s Supreme Court and the People’s Supreme Procuracy to provide guidelines on the legal value of transactions with mortgaged assets.

For its part, the VAMC should come up with a plan to enhance its capacity.

“All measures aim to help the company handle bad debts more efficiently, but they must guarantee legal rights and interests of the State, credit institutions and related organisations and individuals,” he said. 

PM approves project for enhancing financial stability     

Prime Minister Nguyen Xuan Phuc has approved a US$1 million project aimed at enhancing financial stability in preparation of the implementation of an Asia Development Bank (ADB) project.

The technical support project is aimed at helping the State Bank of Viet Nam promote the financial stability and the development of non-banking finance through improving the legal framework and the management capacity.

The project will be implemented by 2019 to make room for the implementation of ADB’s project titled the Financial Sector Deepening and Intermediation Project (FSDIP), sub-programme 1.

The prime minister asked the central bank to complete the proposal of implementing FSDIP in line with its commitments to the ADB.

The Ministry of Planning and Investment would work with the Ministry of Finance and the central bank to develop a plan for using ADB’s loans to ensure efficiency. 

Firms from Korean province promote their products in VN     

Executives from 27 companies based in South Korea’s Gyeongsangbuk-do Province met with their counterparts in HCM City on December 2 to explore business opportunities.

The visitors’ firms are in sectors like cosmetics, food, glass and agricultural produce like rice, fruits and juices.

Speaking at the Gyeongsangbuk-do Expo Plaza event, Tran Ngoc Liem, deputy director of the Viet Nam Chamber of Commerce and Industry’s HCM City chapter, said trade between Viet Nam and Korea has developed strongly in recent years, especially since the Viet Nam-Korea Free Trade Agreement took effect last year.

Vietnamese firms have capitalised on the agreement to boost exports to Korea by 30 per cent this year, while imports from the market increased by 10 per cent, he said.

The FTA has also contributed to boosting investments by Korean firms in Viet Nam, he said.

The event, part of the Korea - Viet Nam Trade and Culture Exchange Festival being held in HCM City, is expected to further promote bilateral trade, he said.

Woo Byeongeun, deputy minister for political affairs of Gyeongsangbuk-do, said the event is expected to offer a huge opportunity for expanding exports of the province’s various agricultural products.

On the other hand, many Vietnamese products that are of good quality and reasonably priced would also get an opportunity to enter the Korean market, he said.

Seo Yeol Hwan, a Gyeongsangbuk-do official who addressed a press conference in HCM City on Wednesday, said Vietnamese fruits have also increased their market share in Korea.

“I hope that HCM City firms will export more tropical fruits to Korea and Gyeonsangbuk-do Province in particular.”

Viet Nam is playing an increasingly important role in Asia, he said, adding that many Korean firms are interested in the country.

The festival, held from November 30 to December 3, includes several activities, including a Korea-Viet Nam family reunion, an exhibition of Vietnamese and Korean products, a buyers meeting, business tours to Korean firms in Viet Nam and cultural performances.

In future, more activities would be organised to promote trading and cultural ties between two countries, Woo said. 

Tax agency finds difficult to combat e-commerce transfer pricing

Legal limitations as well as loose and asynchronous coordination among authorized agencies have made it difficult to manage e-commerce and combat transfer pricing in Vietnam, said the General Department of Taxation at a conference in HCMC on December 1.

Tax agencies have been able to manage businesses attending e-commerce not individuals.

Deputy Head of the department’s Reform and Modernization Division Nguyen Thi Hanh said that e-commerce has advantageous conditions to operate in Vietnam with strongly developed IT infrastructures, over 40 million internet users and 130 million mobile subscribers.

E-commerce has attracted the attendance of many businesses under different types comprising online games, goods trading and advertisement. Online goods purchase has become the habit of many citizens while businesses have sped up online trading to reduce costs.

Still the quick development of digital technology in accordance with e-commerce has posed many challenges to management works.

E-commerce via internet has raised difficulties in determining prices and impose taxes. It neither requires much goods stockpiling nor have time and premise limitations with 24/7 cross border transactions.

Goods owners can trade under the state of anonymity and delete transaction information to prevent tax agencies from inspecting their activities.

Director of Financial Training Institute Hoang Tran Hau said that transfer pricing combat was not easy even in developed nations like Britain, the US, Japan and South Korea, where have tight legal and modern information systems, abundant database and good agency coordination.

In Vietnam, tax agencies have met with difficulties in determining e-commerce revenues and costs of businesses and individuals.

So far, the General Department of Taxation and tax agencies have applied Circular 66 issued on April 22, 2010 with detailed regulations on transfer pricing fighting. Some fraud cases have been spotted and inspected. Vietnam has also signed agreements against double taxation.

In addition, the General Taxation Department has established a division in charge of transfer pricing by businesses. Tax officials have been supplied and trained with basic knowledge and skills to combat the issue in e-commerce activities.

However authorized agencies should improve the legal system and better coordinate together to prevent e-commerce attendeees from taking advantage of loopholes to dodge the law and evade taxes.

The Ministry of Finance is now working with authorized agencies to study and issue a slew of legal documents to fight tax fraud and evasion via e-commerce transfer pricing. They will also speed up building policies to suit the reality of the activity and better management to prevent budget losses.

VMG sells entire stake to South Korean company     

VMG Group on Thursaday announced it will sell its entire 62.25 per cent stock in VNPT EPAY to South Korean UTC Investment Company.

The transfer agreement is expected to be completed in 2017. After withdrawing its investment from e-commerce, VMG will continue to divest from the payment sector to focus on digital content – its main business in the past few years.

Established in 2008, VNPT EPAY has rapidly become one of the companies with continuously high growth rate in e- payment.

UTC Investment Company has managed seven investment funds with total value of US$100 million. It has been successful in investing in e-payment firms in South Korea. With UTC’s investment, VNPT EPAY will have opportunities to further develop its new payment services and expand its operation to foreign markets. 

Nonghyup Bank opens branch in Hanoi

South Korea’s largest bank Nonghyup Bank has received an official license from the State Bank of Vietnam (SBV) to open a branch in Hanoi.

Founded in 1961 in Korea, Nonghyup is a co-operative bank with 100 per cent of the capital contributed by farmers and local people. Nonghyup is both a commercial bank and an agriculture policy one to provide credit services for households and businesses, contributing to the Korean economy through credit financing in the field of rural agriculture.

Since 2012, Nonghyup Bank has had the representative office in Vietnam. With the branch official establishment in Hanoi, Nonghyup Bank will participate in Vietnam financial market with full functions of a commercial bank and continue supporting economic development of Vietnam and activities of both countries’ businesses.

Speaking at the launching ceremony in Hanoi, Lee Woo Sik, CEO of Nonghyup Bank – Hanoi Branch said: “The opening of Nonghyup branch in Hanoi not only supports financial resources for Korean entrepreneurs in Vietnam but also contributes to the financial development of both countries through interbank cooperation projects. Besides, we will always expand corporate social responsibility (CSR) activities with a wish to contribute to the prosperity of Vietnam.”

Over the years, Nonghyup Bank is known with the motto "sharing economy" in order to improve social welfare of farmers and disadvantaged people. Moreover, the bank is at the forefront of sustainable rural development through many meaningful activities. In particular, with Nonghyup Foundation established in 2004, the bank has implemented diversified CSR activities. Nonghyup Bank has been chosen as the No.1 in CSR activities for five consecutive years in South Korea.

At present, Nonghyup Bank is implementing many CSR activities to support Vietnamese brides in multicultural families and focus on mountainous areas of Vietnam. In the future, the bank will continue deploying various CSR activities in order to support Vietnamese community, especially the activities to support Vietnamese brides and the volunteer activities in drural areas in coordination with the local community.

Recently, Nonghyup Bank is one of six South Korean enterprises in Vietnam awarded with the 6th CSR Award, held by the Ministry of Planning and Investment in collaboration with Korean Embassy in Vietnam and Korean Trade Investment Promotion Agency (KOTRA). 

The Grand Ho Tram Strip’s Michael Kelly elected to board of Amcham Vietnam

Recognising dynamic potential of Vietnam’s economy and the importance of enhancing commercial and investment links with a change in US administrations, members of the American Chamber of Commerce (AmCham) in Vietnam have elected executive chairman of The Grand Ho Tram Strip Michael Kelly to the organisation’s board of governors for the year 2017.

Kelly, who resides in Vietnam, will be the highest-ranking American executive serving on this board and will play a prominent role representing US business interests in the country to both US and Vietnamese policymakers. 

Since being appointed executive chairman of The Grand Ho Tram Strip – Vietnam’s leading integrated resort situated in the southern province of Ba Ria-Vung Tau – in late 2015, Kelly has been a driving force behind the acceleration of investment and developments in the project. 

Bringing to The Grand Ho Tram Strip over 25 years of senior leadership experience in the hospitality and gaming industry, including time spent managing a joint partnership project with Trump Entertainment Resorts from 1996 to 2004, Kelly immediately initiated a number of new developments to expand the resort’s offerings to both domestic and international visitors. 

Among Kelly’s achievements was hosting the Ho Tram Open – Vietnam’s first Asian PGA Tour golf tournament – at The Grand’s award-winning golf course, The Bluffs, in December 2015. The event was the largest sporting event in Vietnam’s history, with coverage reaching viewers in 180 countries, and firmly established Ba Ria-Vung Tau as a go-to destination for golfers and international tourists alike. 

As chief executive of one of the largest foreign invested projects in Vietnam, Kelly has placed substantial emphasis on aligning developments at The Grand Ho Tram Strip closely with the goals of the government of Vietnam, serving as a role model for foreign businesses operating in the country. 

Given its substantial investments and wide network of industry partners, The Grand Ho Tram Strip is also one of the most prominent US investments in Vietnam, and in the past year, Kelly has played a leading role in supporting the growth of US-Vietnam commercial ties. Notably, in May of this year, Kelly was honoured to be part of an investment promotion event attended by President Obama during his historic visit to Vietnam, during which The Grand Ho Tram Strip’s partnerships with domestic giants CotecCons and VietJet were featured. 

Kelly also serves as the chairman of the tourism committee for the AmCham in Vietnam. In the several short months since his appointment in September 2016, he has already made his mark in this role through his work with The Grand Ho Tram Strip in support of the government of Vietnam’s tourism promotion and investment expansion initiatives.

Forecast: 100 million Vietnamese by 2026

The value of agro-forestry-fishery exports in November is estimated at US$2.69 billion, pushing the total value in the first 11 months of the year to $29.1 billion, according to the Ministry of Agriculture and Rural Development (MARD).

This figure marks an increase of 5.9 per cent over the same period last year, it reported.

The export of major agri-products like coffee, pepper, rubber and tea continued to grow. Coffee grew the most with export volume of 1.6 million tonnes worth $2.98 billion in the January-November period, an increase in volume and value of 36.1 per cent and 24.3 per cent, respectively against the same period last year.

The domestic pepper industry saw a year-on-year 11-month growth of 36.7 per cent in export volume to 170,000 tonnes, and a 15 per cent rise in value to $1.37 billion.

China continues to be the largest importer of Vietnamese rice at 36 per cent of rice exports. But about 4.54 million tonnes of rice worth $2 billion were shipped until November, a year-on-year drop of 25 per cent in volume and 20.3 per cent in value.

The ministry said the fall in rice exports was due to lower demand on the world market, and a domestic market over-supply.

In the wood and wood products market, Vietnamese businesses earned $6.2 billion from exports in the first 11 months of the year. The US, Japan and China remained the top three largest importers, accounting for 69 per cent of the sector’s total exports.

MARD statistics also show that seafood export value increased by 6.9 per cent to $6.4 billion in the January-November period. The US, Japan, China and South Korea were the four largest importers, accounting for 54.1 per cent of the total value.

Seafood exports to China, the Netherlands, the US and Thailand rose 47.7 per cent, 16.1 per cent, 13.1 per cent and 12.6 per cent, respectively.

The quality of products has been an impediment to export growth, officials say.

Speaking at a forum on food safety and hygiene held in Ha Noi last week, deputy head of the Ministry of Trade and Industry (MoIT)’s Trade Promotion Agency, Do Kim Lang, said the country was facing difficulties in exporting agro, forestry and seafood products, partly due to strict quality regulations in the importing markets.

Lang blamed this on the lack of close links between the production process and the market, and between businesses and farmers. He said this meant products were of uneven quality, with some containing antibiotic and chemical residues, not meeting food hygiene and safety standards.

“Many Vietnamese businesses have had to take back their export products; several importers have even visited Viet Nam to warn ministries and agencies that the country’s exports can come to a standstill until problems regarding antibiotic and high chemical residues are solved,” said Lang.

Le Thanh Hoa, deputy director of the Viet Nam Sanitary and Phytosanitary Notification Authority, said enterprises should inspect and supervise food safety in production chains, instead of the current practice of checking finished products. 

“From farming to chocolate” model boosts Vietnam’s cocoa reputation

Vietnamese possesses some favorable microclimates for growing cocoa. Cocoa trees are grown in the central highlands and the southwestern region, where the climate is neither too hot nor too cold.

Realizing Vietnam’s potential for cocoa, in 2008, Puratos Grand Place, a Belgium group, started a model called“From farming to chocolate” in Vietnam, using Vietnamese cocoa to produce made-in-Vietnam chocolate.

Cocoa trees were introduced into Vietnam a long time ago, but farmers at first grew them unprofitably on a family scale. Vietnam’s Mekong Delta and Central Highlands regions are now major cocoa-producing regions. 

Phan Thi Phuong Thanh, Marketing Manager in Puratos Grand Place Vietnam, said, "In Vietnam, farmers often lack accurate information about the value of cocoa trees."

"When they think that other trees are more profitable, they give their land over to growing oranges, grapefruits, and mandarin oranges. When they see a great demand for cocoa, they re-plant cocoa trees. This leads to instability in the cocoa supply in Vietnam," she added.  

In 2008, Puratos Grand Place began working with farmers in the Mekong River Delta area, conducted research on cocoa cultivation, and started a program to develop cocoa trees sustainably in Vietnam. 

Today, the world’s consumption of chocolate is rising while production is decreasing, so it is time to create a stable source of cocoa. 

Pierre Le Hegarat of France is the business development manager at Puratos Grand Place Vietnam.

He said, "Today, the consumption is increasing. For example, in France, an average about 7 kilo per person per year, If you go to Switzerland, it’s about 11 kilo per person per year. Europe is a big consumer of cocoa and chocolate. What you have to know, you have to . One cocoa tree can give you every year one kilo of cocoa". 

The model “From farming to chocolate” focuses on the farmers who are directly involved in growing the cocoa. The program teaches them advanced growing and cocoa beans processing techniques to boost quality. 

It requires a meticulous process to produce a great bar of chocolate. It involves many steps -  growing, drying the beans, fermentation, roasting, and not many farmers know how to do this properly.

"In Vietnam, many people ferment in their own way. Many farmers after harvesting cocoa beans, they leave on the two sides of the road, the quality of the cocoa beans is not good, because it’s rotten," Pierre Le Hegarat said.   

The farmers are trained in growing techniques, fermentation, roasting, and grinding to produce the cocoa powder needed to make chocolate. "In Ben Tre province, we have a collection and fermentation center. In this center, we welcome all the farmers, we work with them on the technique of cocoa tree, how to grow the tree. Because you know, cocoa tree is very sensitive with the sun with the rain, so you have to grow something like forest to protect the cocoa tree". 

Farmers receive up-to-date market information on cocoa. To improve the quality of seedlings and cocoa beans, the program also provides farmers with tools and equipment such as incubators and drying platforms. 

The farmers are encouraged to take better care of their plants and improve their productivity through a “chocolate bonus” program.  

Ms. Phuong Thanh said, "In addition to revenue, under Cacao Trace, our program to promote long-term cocoa production and sustainable development, we have the “chocolate bonus” program. If the farmers’ products meet the set quality requirements, we give them a bonus to encourage them to produce high-quality cocoa and improve their productivity". 

The program benefits more than 2,000 farmers who collectively produce 50% of Vietnam’s cocoa.  

Vietnamese cocoa combined with Belgian know-how, and equipment, is producing higher-quality Vietnamese chocolate. 

The “farming to chocolate” model has created a more sustainable cocoa supply and has boosted productivity and incomes for farmers in the Mekong Delta and central highland regions. 

Do Nam, a farmer who lives in Tra Vinh province, said, "Today we receive much better guidance on how to take care of cocoa trees. This has considerably improved our cocoa productivity and quality".

Rubber exports go up in volume and value

Rubber exports are estimated at 117,000 tons in November with a value of US$165 million, bringing the total export volume in 11 months of this year to 1.1 million tons to fetch US$1.43 billion (up 12.3% in volume and 4.6% in value), according to Vietnam Customs.

China and India were two biggest consumers of Vietnamese rubber in the first ten months, accounting for 66.1% of market shares with a value of US$732.1 million and US$104.1 million respectively.

Meanwhile, rubber imports in November were 44,000 tons worth US$74 million, bringing the total import volume in 11 months to 387,000 tons with a total value of US$604 million, up 10.9% in volume and 2.5% in value. Vietnam imported rubber mainly from the Republic of Korea, Japan, Cambodia, and Taiwan.

The price of rubber latex began going down sharply in 2014. However, since early this crop, the price has been increasing steadily. Natural rubber latex now is priced at VND6,500-12,000 per kilo (up VND1-2.5 million per ton compared to early September.

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