Thu Thiem’s land prices forecast to rise 30-35%

 Land prices in Thu Thiem New Urban Area in District 2, HCMC are forecast to increase 30-35% in the coming time, according to property services provider Jones Lang LaSalle (JLL).

JLL said prices of residential units in the peninsula are currently 30-35% below District 1’s levels.

Meanwhile, in Shanghai, apartment prices in Pudong new center are 43% above the old central business district of Puxi, and Bonifacio prices are the same as Makati in the Philippines. Over time, the consultant expected Thu Thiem to follow a similar trend.

Stephen Wyatt, country head at JLL Vietnam, said Thu Thiem’s average land price is roughly one-third of District 1 and relatively low compared to neighboring districts such as Districts 3 and 4.

However, he added, with the establishment of Thu Thiem projects and some improvement in the legal and planning framework, it is reasonable to say that land prices will continue to increase in the coming years.

Land prices in Thu Thiem have picked up by 30 to 40% over the past three years. JLL said this is a record but appropriate rise as prices were rather low initially. A majority of housing projects there are selling well.

In Thu Thiem, some 45% of the total development areas have been officially approved through build-transfer agreements. Dai Quang Minh is developing the US$2.2-billion Sala housing project in Thu Thiem.

Around 10 investors have developed projects worth about US$5 billion. In addition to the Sala project, some other major projects include the Empire City project of Keppel Land, Gaw Capital Partners, Tien Phuoc JSC, and Tran Thai Real Estate Co Ltd; and the Eco smart city project of Lotte Group.

Many overseas investors from China, Malaysia, Singapore, South Korea and Japan have expressed interest to invest in the peninsula. They are hunting for good investment opportunities in Thu Thiem at a reasonable land price through acquisition or joint venture with local partners.

The pace of development in Thu Thiem remained stagnant mainly because of land compensation issues.

As of this June, 99% of the total area in Thu Thiem had been fully compensated for, according to the District 2’s Resettlement Committee. 87 land lots have yet to be compensated for, including 83 households and four religious establishments.

Land has largely been handed over to investors but many lots of land there have yet to be developed, according to Stephen Wyatt.

Many investors revealed it was difficult for them to estimate the investment timeline and return, due to the lack of transparency in the investment procedure, he stressed.

He added developers, especially those with a strong investment appetite for commercial properties, are still waiting for more incentive policies for this area.

The 657-hectare new urban area is located opposite to District 1. Comprising 176 land lots with roughly 3.2 million square meters of residential space and 3.4 million square meters of commercial space, the total peninsula will eventually accommodate 145,000 residents plus 217,000 workers. 

Vietjet to pay 60% dividend for this year

Budget carrier Vietjet Air (HoSE: VJC) is collecting shareholders’ opinions on increasing the estimated 2017 dividend payout from 50 per cent to 60 per cent, including a maximum of 40 per cent cash dividend.

If approved, the estimated 2017 dividend payout ratio will be 60 per cent, with the cash dividend rising from 30 per cent to 40 per cent. The purpose of collecting shareholders’ opinions is to make the necessary arrangements for the advanced second dividend payment in 2017.

Vietjet is also seeking shareholders’ opinions on a change of business line and the address of its headquarters to 302/3 Kim Ma Street, Ba Dinh District, Hanoi. The close of registrations for shareholders to submit opinions is December 19.

In mid-August, Vietjet advanced VND645 billion ($28.3 million) for a 20 per cent cash dividend payment in 2017. Prior to that, it also paid a 40 per cent bonus share dividend and finalized the 2016 cash and bonus share dividend payment at a rate of 119 per cent.

Vietjet is the first airline in Vietnam to operate under the new low-cost model and provides a wide range of services to customers through advanced e-commerce technology applications.

Vietjet is an official member of the International Air Transport Association (IATA) and has IATA Operational Safety Audit (IOSA) certification. In addition to being named among the “Top 500 Leading Brands in Asia 2016” and the “Best Employer Brand” in Asia for many consecutive years, Vietjet was also voted “Best Asian Low Cost Carrier in 2015” at the TTG Travel Awards and is among the Top 3 growing carriers on Facebook, as voted by Socialbakers.

Vietjet is now operating 45 A320 and A321 aircraft, conducting about 350 flights a day and carrying some 40 million passengers on 73 routes to destinations in Vietnam and to Hong Kong, Singapore, South Korea, Taiwan, China, Thailand, Indonesia, Myanmar, Malaysia, and Cambodia.

The airline plans to expand its Asia-Pacific network and purchase modern aircraft from leading manufacturers. 

Polish group acquires Vietnamese pharma company

The Adamed Group from Poland has acquired a controlling stake in Dat Vi Phu, Vietnam’s fastest-growing pharmaceutical company.

The share purchase agreement was signed in Hanoi in the presence of visiting Polish President Andrzej Duda and State President Tran Dai Quang.

The transaction is the largest direct Polish investment in Vietnam to date.

The deal provides for an extensive investment plan, including the transfer of Adamed’s knowledge and expertise. The purchase agreement was signed by Dr. Małgorzata Adamkiewicz, Director General of the Adamed Group, and Mr. Pham Tai Truong, the founder of Dat Vi Phu, on November 28.

Dat Vi Phu manufactures a wide range of medicinal products for both the Vietnamese and neighboring markets. “We consider our investment to be a launch pad for the further dynamic expansion of the Adamed Group into the Asia-Pacific region,” said Dr. Adamkiewicz. “I’m convinced that, in view of the scale of this transaction and further investments into the development of the company, our undertaking will constitute a milestone in strengthening economic relations between Poland and Vietnam.”

In its more than ten years in the business, Dat Vi Phu has acquired a sizable share of Vietnam’s pharmaceutical market. “The investment by the Adamed Group is an opportunity for our continued dynamic development,” said Mr. Truong. “Cooperation with such an experienced partner will enable us to reinforce our position in the local market and expand in the Asia-Pacific region.”

The investment forms part of the internationalization of the Adamed Group. It recorded a 15 per cent increase in export revenues in 2016 and aims to constantly grow its foreign sales.

Dat Vi Phu was established in 2004 and manufactures nearly 300 medicinal products in most therapeutic classes. It is the fastest-growing company in Vietnam’s pharmaceutical market and exports its products to the Philippines, Cambodia, and Myanmar. Located in southern Binh Duong province near Ho Chi Minh City, it currently employs some 200 people.

HCM City’s November CPI picks up 0.17 percent

The consumer price index (CPI) in Ho Chi Minh City in November gained 0.17 percent on a monthly basis and 4.32 percent year-on-year, the municipal Statistics Office announced on November 29.

Prices of seven out of 11 commodity groups experienced slight increase, with the highest rise of 0.8 percent seen in transport, attributable to the impact of gasoline price adjustment in the month.

Other goods with higher prices included food and catering services (0.27 percent), beverage and tobacco (0.15 percent), home appliances (0.15 percent), garment, hat and footwear (0.03 percent), housing, electricity, fuel and construction materials (0.02 percent) and culture, entertainment and tourism (0.01 percent).

Meanwhile, prices of medicine and healthcare services, education, telecommunications and other goods and services remained stable in the month.

In contrast, the price of gold dropped 0.08 percent and that of US dollar declined 0.04 percent from the previous month.

Vietnam Expo 2017 to open in HCM City

The 15th Vietnam International Trade Fair (Vietnam Expo 2017) will take place at the Saigon Exhibition and Convention Centre in Ho Chi Minh City on December 6-9.

The expo continues to be an important bridge to connect Vietnamese and foreign enterprises, allowing them to meet and exchange views on business cooperation.

It is also a destination where policymakers can update latest waves of market and producers can popularise their trademarks as well as expand consumption network.

This year’s event will feature 800 booths of 750 businesses from 16 countries and territories including India, Taiwan (China), Germany, the Republic of Korea, Indonesia, Malaysia, the US and China.

On display will be various products such as electronic devices and products, hardware products and hand tools, construction materials and household products-consumer goods.

According to the Vietnam National Trade Fair & Advertising Company (Vinexad), participating companies want to introduce their new items for 2018 with the aim of seeking customers’ feedback for evaluating the market’s demand.

Numerous activities will be held in the framework of the event, notably a trade exchange between Vietnamese and Chinese electromechanical firms.

A seminar on Vietnam’s economic, trade and investment cooperation with three Chinese localities of Beijing, Tianjin and Hebei is scheduled to be held on December 6, offering opportunities for businesses of the two countries to exchange views and cooperate in various fields.

A talk on infrastructure quality and construction of Asia’s future, with the participation of Japan’s Ministry of Economy, Trade and Industry, will be organised, among others.

According to the organising board, 520 businesses showcased their products at the 2016 expo, which attracted 11,650 visitors.

SMEs urged to use energy efficiently

Small- and medium–sized enterprises (SMEs) in industrial production were urged to develop green growth strategies to improve business efficiency and protect the environment, experts said at a conference held by the Central Institute for Economic Management (CIEM) on Wednesday.

Trinh Duc Chieu, Deputy Head of CIEM’s Corporate Development and Reform Department, said that a large number of SMEs still used outdated and energy-consuming technologies, despite the Government’s push to promote green growth.

Chieu cited a survey that found 75 per cent of processing and manufacturing enterprises in Ha Noi said that their energy consumption was higher than the world’s average.

In 2015, 53 per cent of companies in the processing and manufacturing industry used technologies which were developed more than six years ago and only 14 per cent invested in technologies that had hit the market within the three most recent years.

In addition, most SMEs did not conduct reports on their energy consumption and their awareness about the importance of using energy efficiently remained low.

SMEs made up around 17 per cent of companies operating in the manufacturing and processing industry – the sector which consumed the most energy, accounting for 43 per cent of the country’s total energy consumption.

According to Chieu, the lack of support and inconsistencies in policies has not encouraged SMEs to use energy more efficiently. Besides, the development of renewable energies still dramatically lags demand.

“It is important for SMEs to enhance energy use efficiency, which will help cut production costs, improve quality, increase profits and develop in a sustainable way,” Chieu said.

Moving towards green growth, using natural resources and energy more efficiently, will increase resilience to climate change.

Chieu said the legal framework on energy must be improved to encourage energy efficiency and prod SMEs to shift towards renewable energies.

According to Nguyen Dinh Khuyen from the General Statistics Office, an energy data system should be developed to provide information for analysis in order to craft appropriate policies.

At the conference, experts also said that tax and credit policies should be established to encourage the development and use of renewable energies and so that SMEs will update their technologies.

Uber, Grab to face tax inspection next year

The General Department of Taxation has asked tax offices to prepare inspections of enterprises next year, especially ride-hailing services firms Uber and Grab, Tien Phong newspaper reports.

Local tax authorities will have to check the fulfillment of tax obligations of at least 18.5% of enterprises under their supervision.

In addition, hospitals, credit institutions, hotels, restaurants, casinos, seaports and companies in fuels, aviation, pharmaceutical products, tourism, automobiles, construction, real estate, mining and online business sectors will be subject to tax inspections.

Tax agencies will have to pay attention to enterprises involved in transfers of capital, brands and projects, and also attend more to those declaring losses over the years or generating lower profit than other enterprises in the same sector.

According to the General Department of Taxation, Grab has operated in Vietnam since February 2014. It has legal capital of VND20 billion (US$0.88 million) but has incurred a VND938-billion loss due to many promotion programs as explained by the company.

Grab earned nearly VND1.8 trillion and paid over VND9.5 billion in tax between 2014 and last year. After inspections, the HCMC Department of Tax has required Grab to pay an additional VND2.9 billion.

Meanwhile, Uber posted revenue of a combined VND2.7 trillion in the last three years and the first haft of this year and paid VND76.8 billion to the State budget. The ride-hailing service provider will also have to pay an additional tax sum of VND66.6 billion.

Real estate business increases up to 60.5 percent

The Ministry of Planning and Investment reported that the country had nearly 11,000 newly established companies in November, 2017.  

From January to November, around 140, 394 nationwide enterprises were established and re-operated with total newly registered capital of US$ 119.5 billion. 

Of the number, around 41, 627 firms operated in the fields of business, retail, repairing, automobiles and motorbikes, accounting for 35.9 percent; 14,846 enterprises in the sectors of processing and manufacturing industry accounted for 12.8 percent; 14,695 companies in construction accounted for 12.7 percent and 8,663 ones in the sectors of science and technology; consulting services, design, advertisement and other professional accounted for 7.5 percent etc…

The average density of registered capital per an enterprise reached at VND 9.8 billion in the first 11 months of 2017, up 24.3 percent compared to the same period last year. 

This year’s rate of enterprise increase in real estate sector accounted for 60.5 percent over the same period of 2016.

In the first eleven months of 2017, total newly registered capital of real estate increased up to VND 314, 2 trillion, accounted for 27.8 percent of total registered capital of the country. 

Aside from real estate, the fields of business, retail, repairing, automobiles and motorbikes had total registered capital of VND 182 trillion accounted for 16.1 percent, and  total registered capital of construction was at VND 155.3 trillion. 

Footwear exports enjoy 13 percent rise during Jan-Oct

The export turnover of Vietnamese footwear products hit 11.82 billion USD in the first ten months of 2017, up 13 percent year-on-year.

Exports to Indonesia recorded the highest growth, at 53 percent, followed by Singapore (45 percent), Hungary (34 percent), India (33.7 percent) and Poland (33 percent).

The Vietnam Leather, Footwear and Handbag Association predicted that the footwear sector’s production will enjoy a growth rate of 5 percent this year compared to last year, while the export value of footwear and handbags will reach nearly 18 billion USD, or a 10-percent rise a year-on-year.

Vietnam is aiming for 24-26 billion USD in leather, footwear and handbag exports by 2020, 35-38 billion USD by 2025 and 50-60 billion USD by 2035.

Franchise restaurants boom in Vietnam

Not only are Vietnamese restaurateur reaching out to foreign brands to import their business models, global franchisors now view Vietnam as a huge potential market to expand their network.

Popular global franchise brands like Little Caesars, Jumbo Group, The Boiling Crab, and Element Fresh have all sat down with Vietnamese partners in preparation for their entry into the 94-million-strong market.

Presently, Vietnam is home to 71 foreign restaurant franchises, including ‘big players’ like McDonald’s, Starbucks, Burger King, and BBQ Chicken.

Most of these franchises are currently flourishing in the country’s largest hubs of Hanoi and Ho Chi Minh City, but others are beginning to target growing cities such as Da Nang and Hai Phong to further cement their foothold.

William Schreiber, vice-president of international development for US pizza chain Little Caesars, said he had traveled to Vietnam 15 times in search of opportunities to ink franchising deals with local businesses.

The third-largest pizza chain in the US, Little Caesars already has over 5,000 locations in 18 countries, but Vietnam is looking like the first country in Southeast Asia to earn a franchising deal with the company.

Recently, Singaporean seafood restaurant group Jumbo also partnered with a Vietnamese company to launch the franchise locally, having made successful entrances in China and Japan.

Other popular franchises like Grimaldi’s Pizzeria, Boiling Crab and Presotea have announced their intention to open stores here.

With prices that target middle-income earners, restaurant franchises are becoming increasingly popular with the younger generation in Vietnam as a go-to place for dining, hanging out with friends, and meeting with business partners.

Vietnam-based Golden Gate Group, one of the first in the country to conduct business with foreign franchisors, has until now successfully imported and operated 22 restaurant franchises ranging from barbecue, hot pot to beer clubs.

In 2016, the firm reported revenue of VND2,628 billion (US$115.77 million), a 524% growth rate on 2013.

With its current network of 201 locations across Vietnam, it is estimated that the firm will reach 400 locations by as early as 2018.

According to Hoang Tung, owner of the Vietnamese pizza chain Pizza Home, the cost of franchising a popular brand can amount to VND1 billion (US$44,000), not to mention a percentage of revenue paid regularly to the franchise owner.

People line up outside Vietnam's first Starbucks restaurant in Ho Chi Minh City on its opening day, February 1, 2013. 

Despite the overwhelming number of success stories in Vietnam, in reality many brands have been forced to depart the market after finding themselves falling behind in a dog-eat-dog environment.

Examples include fast-food restaurant Subway and coffee houses such as Gloria Jean's Coffees, The Coffee Bean & Tea Leaf and N.Y.D.C.

“Not many Vietnamese franchisees have the experience to run restaurant franchises on a large scale, which often results in fatal mismanagement once the number of locations reaches the hundreds,” an official from the Ministry of Industry and Trade asserted.

“They still have a lot to learn from foreign restaurateurs.”

Son La ships first batch of passion fruit to France

Nafoods Group has exported the first two tons of passion fruit to France, said the company representative.

Nafoods has got a licence from northern Son La province to grow and process Passion Fruit. Currently, the company is growing the fruit on more than 500ha in two districts of Moc Chau and Thuan Chau with an estimated output of more than 12,000 tons this year. 

The export of Passion Fruit to France will contribute to boosting exports of the province’s key agricultural products and diversifying trade outlets. 

Son La has so far exported tea, plums, mangoes, and honeybee to overseas markets.

SOEs able to apply book building for IPOs in 2018

Vietnam’s company to plant 500 ha of rubber in Laos

Quang Tri Rubber Co. Ldt., a subsidy of the under the Vietnam Rubber Group (VRG), will plant 500 hectares of rubber and build a rubber processing factory in Saravane province, Laos under a land leasing contract signed on November 29 in Vientiane.

The project has a total investment of US$ 10 million with an operational duration of 30 years.

Speaking at the signing ceremony, Deputy Minister of Planning and Investment Khamlien Phonsena welcomed the project, stressing that it would contribute to facilitating the socio economic development, reducing poverty and creating jobs for local residents in the Saravane province.

As the project was signed in Vietnam – Laos Friendship and Solidarity Year 2017, he noted that the project would also tighten the special ties between the two countries.

He asked the Quang Tri Rubber Co. Ldt to implement the project in accordance with its schedule while observing Lao law on environmental protection and Lao Government guideline for clean and green growth.

He also affirmed that Lao authorities and relevant ministries and sectors would create more favourable condition for the project’s deployment.

For his part, Van Luu, Director General of Quang Tri Rubber Co. Ldt expressed his thanks for the Lao Government for the signing of the project, pledging that his company would keep the project on track and closely follow Lao law and regulations during its implementation.

Over VND2.7 quadrillion pumped in Vietnam's economy

Over VND2.7 quadrillion (US$118.8 billion) has been pumped in the national economy over the past 11 months thanks to the establishment of more than 116,000 enterprises and the capital expansion of more than 32,200 others during the 11-month period.

According to the General Statistics Office (GSO), the country witnessed the establishment of more than 116,000 firms in the January-November period with a total registered capital of over VND1.1 quadrillion (US$48.4 billion), up 14.1% in the number of enterprises and up nearly 42% in terms of registered capital compared to the corresponding period in 2016. The total number of workers registered at newly established enterprises was more than one million.

During this period, more than 32,200 enterprises have registered to increase their capital with a total supplemented capital of over VND1.5 quadrillion (US$66 billion) which has helped raise the total newly registered and supplemented capital of enterprises to over VND2.7 quadrillion in 11 months.

The GSO stated that the average registered capital per new enterprise reached VND9.8 billion (US$431,200), an increase of 24.3% compared to the same period last year.

In addition, 24,349 enterprises have resumed their operations during the 11-month period, raising the total number of newly established firms and firms returning to operations to more than 140,000 in 11 months.

The wholesale and retail sector reported the highest number of newly established firms which accounted for 35.9% of the total number of newly set up firms. Meanwhile, the manufacturing and processing industry accounted for 12.8% of the total number of newly established firms and the construction sector made up 12.7% of the total number of newly established firms.

In the January-November period, more than 10,800 enterprises have registered to dissolve with 91.6% of them being small enterprises with the capital size less than VND10 billion (US$440,000) each and more than 55,600 enterprises have suspended their operations.

Industrial production index continues to make breakthrough

The industrial production index (IIP) in the first 11 months of 2017 was reported at a year-on-year increase of 9.3%, which was much higher than the 7.4% growth level of the same period last year, according to the General Statistics Office (GSO).

Accordingly, industrial production sectors continued to see high growth, with the manufacturing and processing industry growing 14.4%, contributing 10.1 percentage points to the general IIP growth.

The power production and distribution sector surged by 9.6%, contributing 0.6 percentage point, while the water supply and waste and wastewater treatment sector soared by 7.7%, contributing 0.1 percentage point to the 11-month IIP increase.

Meanwhile, the mining industry decreased by 7.1%, therefore reducing the overall IIP by 1.5 percentage points.

Some cities and provinces with large industrial scale posted high IIP growth during the January-November period, including Bac Ninh (up 35.5%), Hai Phong (up 20%), Thai Nguyen (up 18.3%), Binh Duong (up 10.4%), Hai Duong (up 9.6%) and Da Nang (up 9.5%). The two national hubs of Hanoi and Ho Chi Minh City reported an IIP increase of 7% and 7.9%, respectively.

In the meantime, Ba Ria–Vung Tau and Quang Nam provinces witnessed a respective decrease of 3.8% and 4.8% from the same period of last year.

Businesses that take good care of employees honoured

The Vietnam General Confederation of Labour (VGCL) organised a ceremony in Hanoi on November 29 to honour 74 businesses that take good care of employees.

The ceremony was attended by Vice President Dang Thi Ngoc Thinh, President of the Vietnam Fatherland Front Central Committee (VFFCC) Tran Thanh Man and VGCL President Bui Van Cuong.

Addressing the ceremony, VGCL President Bui Van Cuong, the ranking is a meaningful activity in encouraging and honouring enterprises which have made many efforts in creating an effective working environment for their employees, ensuring the quality of life of their employees and promoting their capacity and working spirit.

After four years of organising, the program has ranked 275 enterprises, presenting credits to 119 enterprises. In addition, the organising board offering the “Businesses that Take Good Care of Employees” Award to 15 enterprises, and the Prime Minister's certificates of merit to 12 different enterprises.

The “Businesses that Take Good Care of Employees” rankings was launched by VGCL since 2014, creating a wide-range movement in order to encourage businesses to take better care of employees, for the development of businesses and communities.

SMEs urged to use energy efficiently

Small- and medium–sized enterprises (SMEs) in industrial production were urged to develop green growth strategies to improve business efficiency and protect the environment, experts said at a conference held by the Central Institute for Economic Management (CIEM) on November 29.

Trinh Duc Chieu, Deputy Head of CIEM’s Corporate Development and Reform Department, said that a large number of SMEs still used outdated and energy-consuming technologies, despite the Government’s push to promote green growth.

Chieu cited a survey that found 75 percent of processing and manufacturing enterprises in Hanoi said that their energy consumption was higher than the world’s average.

In 2015, 53 percent of companies in the processing and manufacturing industry used technologies which were developed more than six years ago and only 14 percent invested in technologies that had hit the market within the three most recent years.

In addition, most SMEs did not conduct reports on their energy consumption and their awareness about the importance of using energy efficiently remained low.

SMEs made up around 17 percent of companies operating in the manufacturing and processing industry – the sector which consumed the most energy, accounting for 43 percent of the country’s total energy consumption.

According to Chieu, the lack of support and inconsistencies in policies has not encouraged SMEs to use energy more efficiently. Besides, the development of renewable energies still dramatically lags behind demand.

“It is important for SMEs to enhance energy use efficiency, which will help cut production costs, improve quality, increase profits and develop in a sustainable way,” Chieu said.

Moving towards green growth, using natural resources and energy more efficiently, will increase resilience to climate change.

Chieu said the legal framework on energy must be improved to encourage energy efficiency and prod SMEs to shift towards renewable energies.

According to Nguyen Dinh Khuyen from the General Statistics Office, an energy data system should be developed to provide information for analysis in order to craft appropriate policies.

At the conference, experts also said that tax and credit policies should be established to encourage the development and use of renewable energies and so that SMEs will update their technologies.

HCMC to invite tenders for BT projects

HCMC will hold competitive tenders for infrastructure projects  to be carried out in the build-transfer (BT) format to ensure transparency and effectiveness.

According to a source from the HCMC government office, the city will map out a process to implement BT projects to clarify responsibilities of competent agencies involved in projects and shorten the bidding time to select investors.

The city will also put up land for auction to raise funds to pay for contractors of BT projects, instead of allocating land directly to chosen investors.

In addition, the city will diversify payment methods by tapping land lots near projects, and issuing preferential policies on loan interest for projects which are difficult to generate profits.

Although the BT investment form has helped raise huge amounts of capital from the private sector, it is fertile ground for corruption and group interests. The way land is exchanged for infrastructure in BT projects has not been transparent.

Local contents of electronic products still insignificant

Although Vietnam has invested in supporting industries for the electronic sector for about 30 years, local firms cannot still climb higher in the supply chain, mainly producing packaging and plastic and rubber parts for electronic manufacturers, heard a conference on electronic industry development in Hanoi on November 28.

Speaking at the conference, Vu Thi Thanh Huyen, lecturer at the Vietnam University of Commerce, said most important components of electronic products made or assembled in Vietnam are imported.

Data of the Supporting Industry Enterprise Development Center (SIDEC) shows that local contents contribute only 23% to the value of electronic products. Businesses tied to the supply chain of electronic product manufacturers are mostly foreign-invested firms or joint ventures.

According to Huyen, most electronic products sold in Vietnam are imported. Some of them are assembled domestically but most of their components are foreign-made.

Data of SIDEC shows that the country now has 610 producers of electronic accessories, accounting for half of the total number of electronic enterprises.

However, Huyen said foreign-invested electronic makers and assemblers, such as Samsung Electronics, rarely sign long-term contracts with Vietnamese suppliers of components.

Besides, local firms mainly provide low-value components like packaging, plastic and metal parts, or transport and catering services, while sophisticated components that make up most of products’ value are mainly supplied by foreign-invested suppliers.

According to Nguyen Dinh Vinh, general director of Hanel JSC, Vietnamese enterprises are not strong enough to participate in the supply chain of multinational corporations. Local firms need to invest trillions of Vietnam dong if they want to become component suppliers of large foreign-invested enterprises like Samsung.

Vinh said the weaknesses of local firms might result from the weak connection between them and foreign-invested enterprises, and the ineffective management of ministries and departments.

Bang Hyun Woo, deputy general director of Samsung Vietnam, said foreign-invested enterprises have been struggling in seeking Vietnamese partners as they do not have adequate information of local firms, especially information on their scales and technologies.

Veggies surpass crude oil in export earnings

Outbound sales of vegetables have soared to US$3.16 billion in the year to date, well above crude oil export revenue of US$2.44 billion, Vietnamnet news site reports.

The Ministry of Agriculture and Rural Development said in a report released on November 28 that the value of vegetables export has risen a staggering 43.2% compared to the same period last year. Vegetables exports in November along are forecast to reach US$292 million.

As such, the commodity will likely maintain its third position among Vietnam’s biggest agriculture and seafood export earners.

China, Japan, the United States, and South Korea were the major buyers of Vietnamese vegetables in the January-October period, making up 75.6%, 3.6%, 2.9%, and 2.6% of the total respectively. Japan, the United Arab Emirates and China saw their imports of Vietnamese veggies rising 67.6%, 56.9%, and 52.7%.

The respective export revenues from rice and crude oil have been slow at around US$2.48 billion and US$2.44 billion in the year to November. However, veggies export has leapfrogged in the past two years.

For example, according to the Vietnam Fruit and Vegetable Association, the export revenue of vegetables brought in US$2.4 billion in 2016, but the figure has now reached US$3.16 billion so far this year.

A senior official of the Plant Protection Department under the Ministry of Agriculture and Rural Development projected outbound sales of vegetables would amount to US$3.4-3.6 billion in all of this year.

HCMC should build more boat stops for waterway tourism

HCMC should build more boat stops to develop river tours into a major tourism product of the city to attract more travel enterprises to invest in the sector, heard a seminar on waterway tourism in HCMC on November 28.

At the seminar held by the HCMC Departments of Transport and Tourism and Sai Gon Giai Phong newspaper, many enterprises said the city’s natural conditions are good to develop waterborne tourism products. However, the sector has not grown as strongly as expected due to a lack of stopover stations.

The city currently has only three boat stops, namely Tan Cang, Cau Mong and Vuon Kieng, and last named situated at Bach Dang Wharf. Among them, Tan Cang station is far from the city center and Vuon Kieng station has just been upgraded.

Meanwhile, the fee to use Cau Mong station is high, VND500,000 for a boat each time. Besides, the station has no restrooms, so only four enterprises have used the facility, said Lieu Thi My Hanh, sales director of Hoang Trieu Construction Investment Corporation which operates 15 canoes.

Other companies trading in restaurants and yachts in the Saigon River such as Indochina Travel Yacht, Viet Princess and Blue Pearl Voyages also agreed that the city should build boat stops at favorable positions, saying they are willing to invest in these projects.

Nguyen Dinh Cuong, managing director of Blue Pearl Voyages, told the Daily that the company wants to invest US$10 million in the initial stage of a yacht station project on Nguyen Binh Street of Nha Be District.

Active DIG trading drives turnover up

Development Investment Construction Joint Stock Corporation (DIG) saw 128 million shares traded, buoyed by the Ministry of Construction’s capital divestment, which led trade value on the HCMC exchange to soar on November 28.

DIG went up to its upper limit of VND19,250 a share and took the lead by liquidity on the Hochiminh Stock Exchange. Notably, foreign investors acquired over 56.4 million shares in the enterprise.

Earlier, the Ministry of Construction announced to sell over 118 million DIG shares, or a 49.65% stake, within one month starting November 17. With the DIG price on November 28, the ministry earned an estimated VND1.7 trillion from the share sale.

According to tinnhanhchungkhoan.vn, DIG has nearly 3,200 hectares of land nationwide, including in prime locations in Ba Ria-Vung Tau, Dong Nai, Vinh Phuc and Lam Dong provinces, and Phu Quoc Island off Kien Giang Province. Between January and September, DIG saw its revenue and after-tax profit up 7% and 12% year-on-year at VND872 billion and VND43 billion respectively, meeting 62% and 34% of the full-year goals.

DIG gave a boost to investor sentiment, sending the VN-Index up 2.6 points, or 0.28%, at 941.21 points. Trading volume rose 42.4% to 359.5 million shares and trading value jumped 48.7% to VND8.8 trillion, including block deals valued at more than VND2.1 trillion.

With the current outstanding volume of over 238 million shares, investors changed hands up to 54% of the total DIG share volume. Its trading value reached over VND2.4 trillion, making up 28% of total turnover on the southern bourse.

Among large caps, SAB, Vietnam’s top brewery firm, hit an intraday high of VND320,000 a share while construction firm ROS added 0.7% at VND189,100 per share. For VN30 stocks, MBB was the most liquid stock with 6.2 million shares changing hands, followed by oil and gas stock PVD with 4.1 million shares and sugar company SBT with 3.9 million shares.

Many speculative stocks continued advancing strongly, in which agricultural firm HAI and mining stock AMD went up to their ceiling prices of VND8,460 and VND9,830 per share respectively. FLC, a property enterprise, reported trading volume of 14.4 million shares but fell 1.3% at VND7,020 per share.

The HNX-Index retreated after a four-day rising streak, dropping 0.47% against the previous day at 111.5 points. There were 62.1 million shares worth nearly VND802 billion transacted on the Hanoi market, down 29% and 22% respectively.

Lender SHB took the lead by liquidity with 14.3 million shares traded, followed by construction firm VCG and petroleum technical service firm PVS with 5.6 million shares and 5.5 million shares respectively. HKB, which operates in the food sector, hit its upper limit of VND2,500 per share with matching volume of one million shares.

Vissan retails pork at wholesale prices

Vissan, Vietnam’s leading meat processor, on November 28 inaugurated its first outlet to retail pork at wholesale prices on Bui Huu Nghia Street in Binh Thanh District, HCMC.

The store will offer pork products at wholesale prices to vendors at traditional markets, restaurants, hotels, schools, factories and other collective users from midnight to 6:00 a.m. every day. Besides, fresh and processed food will be sold at the outlet from 6:00 a.m. to 21:00 p.m.

Vissan general director Nguyen Ngoc An said the company expects to open five more such outlets near traditional wet markets by 2018.

An stressed the store sell products provided by farms meeting VietGAP standards as controlled and inspected by competent agencies. The origin of products can be traced by using TE-FOOD app.

Vissan has also set out its food safety requirements from the slaughter of pigs to pork distribution. Pork will be transported by special-use vehicles to outlets with refrigerators to store food and staff equipped with necessary facilities and knowledge about food safety.

Vissan is developing a supply chain of pork without antibiotics. In the year to end-October, the company’s processed food sector grew 15% and fresh food 10% over the same period last year and its revenue increased 15%.

Vissan now contributes 10% of HCMC’s fresh meat supply. In the coming time, the company will expand its markets to other large cities nationwide, An said.

Ministry plans higher tariffs on steel imports to support domestic production

The Ministry of Finance is seeking comments on a plan to revise up import tariffs on some products, especially steel, as proposed by Hoa Sen Group Joint Stock Company, Tap chi Tai chinh reports.

In particular, Hoa Sen has proposed increasing the tariff on coated steel sheets coded 7210.41.11 from 20% to 25%, the tariff on rolled steel products coded 7211.19.11, 7212.40.10, 7212.50.91 and 7212.50.99 from the preferential rate of 0% to 10% as pledged in WTO commitments, and the tariff on steel products coded 7212.40.90 from 7% to 10%. The reason the company gave is that it can now produce such products.

The tax increase proposal also aims to ensure the tariffs charged on semi-finished products are not higher than those on finished products.

According to the Ministry of Finance, steel sheet products coded 7210.41.11 are subject to a duty of 20% as they are produced domestically. Imports of such products totaled US$136,000 in 2015.

Under the Ministry of Planning and Investment’s Circular 14/2015/TT-BKHDT, the country can make products coded 7211.19.11, 7212.40.10 and 7212.40.90, and last year imported US$2.7 million, US$3.3 million and US$373,000 worth of these respective products. They are mainly imported from China, Japan, South Korea and Thailand at a zero duty under the ASEAN Trade in Goods Agreement (ATIGA), the ASEAN-China Free Trade Agreement (ACFTA) and the ASEAN-Japan Comprehensive Economic Partnership.

As most of these products are produced domestically and imported with a duty of 0%, the ministry plans to increase the tariffs on such products to 10% to back domestic production.

Regarding the potential impact on budget revenues, as estimated by the ministry based on 2016 imports, import tax collection will rise by US$0.6 million per year.

Agriculture urged to automatise with IoT     

The Fourth Industrial Revolution has seen a boom in breakthrough technologies and affected every sector, including agriculture. The changes require Viet Nam’s traditionally strong agricultural sector to implement smart agriculture solutions if it does not want to lose its markets.

Hoang Quang Phong, vice chairman of the Viet Nam Chamber of Commerce and Industry (VCCI) emphasised the importance of applying Internet of Things (IoT) devices in agriculture at a conference on hi-tech agriculture held in Ha Noi on Tuesday.

The Fourth Industrial Revolution has witnessed the development of technologies such as artificial intelligence (AI), cloud computing, IoT, bio-tech and nano-tech.

He said the active operation of the IoT Open Community of Viet Nam (IOCV) has produced evidences showing how Vietnamese firms might apply smart agriculture. Businesses in the community have built hi-tech agricultural models to control products’ quality, save resources and improve the sector’s competitiveness.

IOCV was initiated by VCCI’s Institute of Business Informatics in March. It includes 21 information and technology companies with the goal of building IoT software solutions for agricultural production models.

For example, Wala Company under VNPT Technology has applied Delco smart farm demo model to make automatise all processes of monitoring, operating plantations and breeding. The company previously needed 20 to 30 workers to do what requires only five workers after the application of IoT.

Bui Ngoc Son, head of the company’s marketing division, said they are applying IoT technology in melon plantations and chicken farms. They use sensors for monitoring to ensure products’ quality.

Nguyen Hong Quang, chairman of Viet Nam Free and Open Source Software Association (VFOSSA) said they expected to provide solutions suitable with scale of farmer households with affordable investment.

Quang added Viet Nam should also study IoT models from the US and Israel to develop more advanced technology products.

Dao Van Chien, deputy director of the Hi-tech Department under the Ministry of Science and Technology, said they would closely co-operate with the Ministry of Agriculture and Rural Development to further promote the application of IoT in agriculture.

LienVietPostBank and Woori Bank Việt Nam promote co-operation     

LienVietPostBank and Woori Bank Viet Nam on Wednesday signed a memorandum of understanding (MoU) in payment co-operation in Ha Noi.

Under the MoU, LienVietPostBank will provide financial products and services to meet Woori Bank Viet Nam’s demand, in terms of Vi Viet e-wallets, insurance collection services and agencies for Woori Bank Viet Nam during money transfer from foreign countries.

The two banks expected to offer customers good products and services, taking advantage of their wide network nationwide. In addition, the co-operation would improve business results and the brand name of the two banks in the time to come.

Woori Bank Viet Nam also committed to give priority to use and introduce LienVietPostBank’s products and services to its customers.

Woori Bank Viet Nam is an entirely foreign-invested bank in Viet Nam of South Korean Woori Bank.

Founded in 1899 in Seoul, Woori Bank is one of the leading investment banks in Asia and the largest lender by assets in South Korea. It has transaction offices in Ha Noi, HCM City and Bac Ninh.

LienVietPostBank’s e-wallet was launched in August 2016. It could implement online payments of invoices, services and money transfers safely and quickly.

It is expected that by the end of this year, the e-wallet would have at least 2 million users and 10,000 locations accepting payments through the e-wallet.