Vietinbank inks loan pact with foreign banks     

The Vietnam Joint Stock Commercial Bank of Industry and Trade (Vietinbank) signed a syndicated loan agreement worth US$100 million with eight foreign financial institutions.

The institutions are Deutsche Bank AG – Singapore branch, Commerzbank AG – Luxembourg branch, Erste Group Bank AG, E.SUN Commercial Bank Ltd, CTBC Bank Co Ltd Singapore, First Commercial Bank – Overseas branch, State Bank of India-Singapore and Taishin International Bank.

The signing of the agreement has not only asserted the prestige of Vietinbank on the international financial market but also reflected the confidence of investors, as well as international financial institutions, Vietinbank Deputy General Director Tran Minh Binh said.

With this $100 million, Vietinbank pledges to better serve the demand for capital of Vietnamese enterprises, he added. 

CIAS to launch IPO on July 12     

Cam Ranh International Airport Service Joint Stock Company (CIAS) will offer over 1.4 million shares as part of the company’s initial public offering (IPO) on July 12.

The shares will be auctioned on the Ha Noi Stock Exchange (HNX) at the starting price of VND30,000 (US$1.3) each.

Formerly known as Cam Ranh Aviation Trading Joint Stock Company, CIAS was established in 2009 with chartered capital of VND10 billion. In 2016, CIAS increased its chartered capital to VND60 billion.

The company provides services for travelers at the Cam Ranh International Airport in the central coastal province of Khanh Hoa, such as restaurants, catering services, business class lounges and souvenir shops.

This year, CIAS has set a target of VND371.3 billion in revenue, VND35.5 billion in post-tax profit and 35 per cent dividend payment. In the first quarter of 2017, CIAS earned VND101.9 billion in revenue and VND12 billion in post-tax profit. 

Tuy Hoa sugar factory to enhance production capacity

Authorities of the central province of Phu Yen have agreed to the Tuy Hoa Sugarcane and Sugar JSC’s plan to raise production capacity.

The company will enhance its capacity from 2,300 tonnes per day to 3,200 tonnes per day starting from the 2017-18 crop.

Tran Ngoc Hieu, chairman of the board of directors, said the company would invest more than 209 billion VND (9.17 million USD) from now until the end of the year to increase capacity.

Nguyen Chi Hien, vice chairman of the provincial People’s Committee, said the factory’s plan was aimed at improving the income of sugarcane growers and increasing revenue for the company while contributing to the development of the Vietnamese sugarcane and sugar industry.

It would also help in socio-economic development of the province, especially in the mountainous areas where sugarcane was a key crop with an area of over 16,000ha, he added.

The Tuy Hoa sugar factory was built more than 20 years ago in Hoa Phu commune, Tay Hoa district, with initial capacity of 1,250 tonnes per day.

The factory has set a target of producing 26,900 tonnes of refined standard sugar in the 2016-17 crop.

Construction contractors struggling with overdue payments

Many construction contractors are reeling from dozens of billions of dong in overdue payments, and some of them are even facing insolvency as they have not got paid in a timely manner, heard a conference on solutions to overdue payments held on Wednesday. 

Data of the Vietnam Construction and Import - Export Joint Stock Corporation (Vinaconex) showed that as of late 2014, long-delayed payments for the corporation had amounted to VND2,346 billion (US$103.3 million). Even though the amount fell to VND1,185 billion in end-2016, Vinaconex’s operations have been greatly affected.

Truong Son Construction Corporation said that by May 31, 2017, investors, including those of Son La and Lai Chau hydropower plant projects, owed it VND1,653 billion. To ensure normal operation, Truong Son has borrowed about VND1.5 trillion from banks and paid VND126 billion in annual interest.

Similarly, investors had owed Corporation 319 VND1,860 billion as of late 2016. Many other construction firms are in financial distress due to overdue payments for them.

According to Nguyen Tuan Phat, director of the economic development department of Song Da Corporation, for State-funded projects, 3-5% of a contract’s value will not be paid to the contractor until all project inspection procedures are complete. For projects of national importance, 3-5% means a huge absolute figure, such as VND400 billion in the Son La hydropower plant and nearly VND400 billion in the Lai Chau hydropower plant project. Meanwhile, inspection and final settlement take a long time.

DELTA Corporation said the current regulations are lax as they cannot force investors to pay for contractors on schedule.

Duong Van Can, vice chairman of the Vietnam Association of Construction Contractors (VACC), said investors currently owe construction contractors VND30-40 trillion (US$1.32-1.76 billion). Therefore, some major contractors are inclined to shun State-financed projects.

To solve the problem once and for all, DELTA suggested the Construction Law and other relevant laws should be revised in a way that compels investors to secure bank guarantees to pay for the contracts they sign.

According to Can of VACC, when a project is 70-80% complete, the investor should be forced to sign a commitment to timely payment and the contractor should be allowed to suspend construction work when the investor is found to run out of money.

B2S stationery store launched in Vietnam

Thai retailer Central Group last week inaugurated a business to school (B2S) stationery store in HCMC.

B2S in Thu Duc is the first store of Central Group in Vietnam beside many retail brands in which the group has invested through mergers and acquisitions (M&A), share acquisitions, franchises and joint ventures. They include Nguyen Kim home appliances stores, Big C supermarkets, Zalora e-commerce website, Robins shopping centers, SuperSports sport stores, Marks and Spencer fashion stores, Komonoya parity shop and Lan Chi Mart supermarkets.

Central Group Vietnam plans to open 30 B2S stores in the next five years in major cities in the country.

The first B2S store in Vietnam is located under the same roof of Nguyen Kim store on Vo Van Ngan Street in Thu Duc District. Covering a total of 900 square meters, the four-floor center stocks more than 6,000 stationery items with 80% of them imported.

The B2S center offers not only office supplies such as furniture, computers and components, printers and paper shredders but also home furnishing items, handicrafts, gifts, handbags and leather goods.

B2S Vietnam director Nguyen Thi Thuc Vy said the company had located the first B2S in Thu Duc District to serve workers at four large industrial parks and students of more than nine universities there.

A “startup space” is also available on the fourth floor of B2S for young people to come up with startup ideas and projects. Shoppers can also call 1900-1919 and visit the website at www.b2s.com.vn to buy goods.

Vietnam spends heavily on fertilizer, pesticide imports from China

Vietnam’s fertilizer and pesticide imports, especially from China, rose sharply in the first half of this year, compared to the same period last year, according to a Ministry of Agriculture and Rural Development report.

Import shipments of pesticide and pesticide material in the six-month period grew a staggering 44% year-on-year to US$495 million. Besides, Vietnam purchased 2.34 million tons of fertilizer with a total cost of US$628 million, up roughly 24% and 18% against the year-ago period respectively.

Fertilizer products were mainly imported from China, which was responsible for around 36.3% of Vietnam’s all fertilizer imports in the first five months. For pesticides and materials for pesticide production, Chinese products also accounted for a staggering 55% of the total.

Given a petition over overwhelming imports of fertilizer, the Ministry of Industry and Trade decided to launch an investigation into DAP fertilizer imports two months ago. Safeguard measures would be taken against these imports if they are proven to cause material injury for the local industry.

The import bill of agricultural production-related material also rocketed, as the acreage was expanded over the year-ago period, and diseases of food crops followed in large numbers.

Import revenue from agricultural, forestry and fishery products totaled more than US$14 billion while their export bill brought in US$17.1 billion in the first half of this year.

EVN gets more price decision-making power

The Government has issued a new mechanism allowing State utility Electricity Vietnam Group (EVN) to hike the average power retail price when input cost rises 3% instead of 7% as before.

As per Decision 69/2013 of the Prime Minister, the average power retail price can be adjusted within a frame stipulated by the Prime Minister when production cost is up 7%. The minimum interval between two electricity price hikes is six months.

EVN’s price increases of 7-10% must be approved by the Ministry of Industry and Trade. In case of an increase higher than 10%, the ministry must ask the Prime Minister for approval.

Meanwhile, as per the PM’s Decision 24 issued last Friday to replace Decision 69 and taking effect on August 15, after weighing production and other input costs such as generation, transmission, distribution, retail and management, EVN can revise up power prices when there is an input increase of 3% instead of the previous 7%. The minimum time between two price revisions is unchanged at six months.

Should the average power tariff be increased by 3% to less than 5%, EVN will decide the price hike before reporting to the Ministry of Industry and Trade and the Ministry of Finance.

For increases from 5% to less than 10%, EVN can raise power prices after obtaining approval from the Ministry of Industry and Trade. The ministry must reply in writing after 15 days so that EVN is able to apply the new prices.

For hikes from 10% or beyond the permisdible price frame, which could potentially impact on the macro economy, the Ministry of Industry and Trade will work with the Finance Ministry to look into the power price plan presented by EVN. Within 15 days, the Finance Ministry will review the plan to send its comments to the Ministry of Industry and Trade before the Prime Minister gives a final say.

Regarding price reductions, Decision 24 requests EVN to submit a report to the two ministries after calculating input costs. However, the decision just stipulates a “corresponding price cut”, not a specific ratio as for a price spike.

In general, the decision shortens production cost changes for power price hikes from 7% to 3% while allowing EVN to decide price hikes from 3% to 5% without having to report to pricing regulators.

After submitting audited reports on production costs and business results of EVN and member enterprises, the two ministries will review production costs in the previous year. Relevant organizations and agencies are invited to join in the review and the Ministry of Industry and Trade will invite an independent consulting unit to assess the reports.

The ministry will have to announce production costs within 30 days after the completion of the review, said Decision 24.

The average power retail price has remained unchanged since March 2015.

Investors keen on renewable projects

Vietnam will need around US$74 billion to build power plants to meet growing demand for electricity by 2025. Many investors have shown interest in renewable projects, heard an energy customer conference held by Thanh Thanh Cong (TTC) Group last Friday.

The Government has pledged to expand the capacity of electricity generation, especially renewable energy by 14% on an annual basis in the 2015-2030 period.

TTC Group has plans to develop 20 solar power projects in the provinces of Tay Ninh, Binh Thuan, Ninh Thuan, Thua Thien-Hue and Gia Lai with a combined capacity of 1,000 MW by 2020. These projects are expected to get off the ground from the final quarter of this year onward, said its general director Thai Van Chuyen at the event.

Besides, the group has 15 hydropower projects nationwide with a total capacity of roughly 140 MW. Especially, its thermal power output from sugar mills totals around 150 MW, and its solar power systems facilitate agricultural production.

Yasushi Ujioka, board member of Gia Lai Electricity JSC, a TTC unit, said the renewable energy capacity in Southeast Asia is around 4 GW, representing a mere 0.5% of the world’s. Therefore, regional countries aim to raise their potential power capacity from less than 10% to 23% by 2025.

In April, the government of Binh Thuan Province approved in principle multiple solar and wind projects in Tuy Phong, Vinh Hao, Bac Binh, Ham Thuan Bac, and Ham Thuan Nam, among others.

Some major projects include solar power plants Eco Seido Tuy Phong (40 MW – phase one), Vinh Hao (30 MW), VSP Binh Thuan 2 (30 MW), Hong Phong 1 (130 MW) and Hong Phong 2 (120 MW). They require investments ranging from more than VND1 trillion to around VND5 trillion.

Notably, some other companies struck solar power deals such as the Vietnam Electricity Group, Da Nhim-Ham Thuan-Da Mi Hydro Power JSC, Mat Troi Do JSC, Everich Energy JSC, and a joint venture of Asia Petroleum Energy Corporation and France’s Valeco Group among others.

Rentals at IPs in south heading upwards

Land rentals at industrial parks (IPs) in Vietnam’s surged in the second quarter of this year and are expected to increase in the future, according to JLL’s latest Ho Chi Minh City Property Market Overview Quarter 2 report.

Rentals rose $2 to $5 per sq m compared to the fourth quarter of last year.

Net land rentals in Ho Chi Minh City reached a peak in the region, at an average of $40 per sq m, while other cities asked rents of between $30 and $100 per sq m.  

Monthly rent at factories in the quarter was relatively unchanged compared to the first quarter, up $2 to $5 per sq m on short to medium-term leases.

Industrial land in the south welcomed more than 730 ha of new supply from the Le Minh Xuan III IP in Ho Chi Minh City and the Bau Bang Expansion IP in Binh Duong province.

Total leasable land area was recorded at 25,556 ha as at the end of the quarter, up 2.8 per cent compared to the end of last year.

JLL predicts the southern IP market will see stable supply while demand is likely to improve in the time to come.

Between now and the end of the year, supply of industrial estates at operating IPs is predicted to increase slightly. Meanwhile, the pipeline supply of land is foreseen to be relatively quiet due to no large completions.  

The take-up rate and rentals in the industrial market are expected to continuously move upwards in the months to come, mostly due to the positive foreign investment capital and the government’s efforts to improve the business environment.

Over 75 per cent of foreign direct investment (FDI) to Vietnam goes to the manufacturing sector, resulting in growing demand for integrated IPs around the country.

Mr. Troy Griffiths, Deputy Managing Director of Savills Vietnam, said that labor costs in China have risen substantially over recent years, pressuring labor-intensive industries such as garments and textiles and even processing and manufacturing.

China is facing an outbound wave of foreign companies seeking better production factors, especially regarding labor costs. According to JLL figures, manufacturing wages in Vietnam range from $1 to $1.4 per hour.

“As a neighboring economy with convenient waterway and road connectivity to China, Vietnam stands out as an ideal recipient of this wave,” said Mr. Griffiths. “Supporting factors include ASEAN membership, FTAs with large export markets, and labor costs at less than half of those in China.”

Moreover, Vietnam’s edge in its young and skilled workforce is likely to continue to drive manufacturing sector growth of 7-8 per cent annually, according to JLL’s report.

A challenge for investors in Vietnam’s industrial real estate sector is rental prices. Mr. Griffiths told VET that as the domestic economy improves, demand to service local providers will put price pressure on traditional IPs. 

Vietnamese week to be held in Thailand

The Central Group Vietnam will cooperate with the Ministry of Industry and Trade (MoIT) to hold “Vietnamese Week in Thailand 2017” at Central Plaza Ladprao Bangkok in the Thai capital.

This second Vietnamese Week in Thailand will promote “Made in Vietnam” brands in international markets and especially among Thai consumers.

The week will run from July 27 to August 2 at Central Plaza Ladprao Bangkok, which is one of the largest complexes in the Thai capital of Bangkok.

The annual event aims to promote the trade and export of Vietnamese products to countries in the region and the world and, in particular, increase the presence of Vietnamese goods in Thailand.

With a strong commitment to support the sustainable development of domestic suppliers and small and medium-sized enterprises (SMEs) in Vietnam, Vietnamese Week in Thailand 2017 will feature Vietnamese-made products such as pottery, lacquer, silk, and wooden furniture as well as Vietnamese specialties such as fruit and processed food.

There will also be a Vietnamese food area to introduce famous food such as bread, “pho”, and grilled rolls.

There were more than 140 Vietnamese-made items displayed at Vietnamese Week in Thailand 2016 at the Central World Trade Center on an area of over 550,000 sq m, which welcomed some 150,000 visitors.

Vietnamese brands such as Dien Quang, Minh Long ceramics, Saigon beer, Hoa Tho textiles, Tam Lan tea, and Highlands coffee were warmly received by Thai consumers.

Vietnam-Thailand bilateral trade has grown by more than 40 per cent over the last five years, reaching nearly $13 billion last year. A goal of $20 billion in two-way trade by 2020 has been set.

First batch of Luc Ngan “thieu” lychees exported to Thailand

The first batch of one tonne of Luc Ngan “thieu” lychees was exported to Thailand by the Central Group (Thailand) and Hanoi-based Phong Son Tiem Limited Company, according to the Department of Industry and Trade of Bac Giang province.

The fruit is now available at Tops and Central Food Hall supermarkets of the Central Food Retail Company Limited in the capital city of Bangkok.

Based on the initial assessment, “thieu” lychee is a popular fruit and can be sold at high prices in Thailand.

To take full advantage of the removal of tariff barriers since the ASEAN Economic Community was established, businesses have boosted exports of fresh lychees to the Thai market, aiming to ship about 100 tonnes of the fruit in 2017 alone.

According to the provincial Department of Industry and trade, this year’s lychee production is estimated to hit 100,000 tonnes, equivalent to 70 percent of the previous year’s output. Of them, there are 26,000 tonnes of early-ripening lychees and 74,000 main-crop lychees. 

About 40,000 tonnes of fresh lychees are expected to be shipped to China, representing 80 percent of this year’s lychee exports, said the department.

Apart from China, the province has also expanded consumption markets to the US, the EU, Japan and the Republic of Korea.

Masan Consumer to issue 5 million ESOP shares     

Masan Consumer Corporation will issue nearly five million shares to its staff under the Employee Stock Ownership Plan (ESOP) programme in July, the company has announced.

These shares, equivalent to 0.96 per cent of the company’s total outstanding shares, will be offered to 974 employees from July 4 to 11 with the price at just VND10,000 per share. This price is one-sixth of the value of the company’s shares on the Unlisted Public Company Market, which settled at VND60,300 on Monday.

ESOP is part of Masan Consumer’s plan to increase charter capital, raise working capital for business activities and motivate employees to develop an attachment to the company.

Following the issue, Masan Consumer’s charter capital will increase from VND5.38 billion to VND5.43 billion (US$239.3 million).

At its extraordinary shareholders’ meeting on June 23, Masan Consumer elected a new chairman, following which Truong Cong Thang replaced Nguyen Dang Quang to become the new chairman of the fast-moving consumer goods arm of the Masan Group.

The change in leadership is significant because it comes at a time when the company’s core business has been slowing down. Masan Consumer reported sales of almost VND2 trillion and net profit of VND155.6 billion in the first quarter of this year, down 16.7 per cent and 57.7 per cent year-on-year, respectively.

In 2017, Masan Consumer has targeted total revenue of VND14.5-15.3 trillion and net profit of at least VND2.55-2.81 trillion.

Last year, its revenue rose 4.4 per cent year-on-year, but pre-tax profit fell nearly 8 per cent. The company has been witnessing a downturn since 2014.

HAGL expects 1.6 per cent revenue drop in 2017     

Agriculture firm Hoang Anh Gia Lai (HAGL) has predicted VND6.33 trillion (US$281.5 million) in total revenue and VND552 billion in pre-tax profit in 2017, the company announced at its annual shareholder meeting on June 30.

Compared to 2016’s performance, the total revenue mark would be 1.6 per cent lower, but pre-tax earnings would improve from a loss of VND1.4 trillion in 2016.

Main sources of income in 2017 are likely to be fruit (dragon fruit, passion fruit and banana) (VND2.6 trillion), rubber (VND745 billion), cattle for slaughter (VND1.24 trillion) and the real estate project HAGL Myanmar (VND1.14 trillion).

Concerning HAGL Myanmar, HAGL chairman Doan Nguyen Duc said that the group would be willing to sell half of its stake in the project if any investors are interested in this asset.

HAGL is seeking partners to offload its stake in the hydropower plant Nam Kong 3, and the group is proceeding to complete the sale of hydropower project Nam Kong 2. Both projects are developed in Laos.

In the future, HAGL will increase its ownership in the subsidiaries to take control of its sub-business units.

HAGL also forecast its profit in the first half of 2017 reached VND213 billion, equal to 40 per cent of the year’s plan and lower than expected figure as some of the sub units had not operated, thus contributing nothing to the firm’s earnings.

Duc said that the firm will try to fulfill its 2017 target during the second half by achieving 30 per cent of the targeted profit in each quarter.

In addition, the company has successfully reduced parts of its total loans by selling business units and converting bonds into shares to offset the burden in its financial health.

According to the group’s CEO Vo Truong Son, HAGL was able to reduce its total loans by VND5 trillion after selling its sugar arm, HAGL Sugar JSC, to Thanh Thanh Cong Group (TTC) in May and issuing 137.5 million shares at VND8,000 per share to convert the VND1.1 trillion worth of loan agreement made with the Singapore-based national wealth fund Temasek in 2010.

The 137.5 million shares issued for Temasek are forbidden from being traded within one year to keep HAGL’s share price stable, Duc said.

However, the group will not pay dividends for 2017’s performance. Shares of HAGL are listed on the HCM Stock Exchange with symbol HAG, closing yesterday down 4 per cent at VND9,100 per share. 

Find ways to step up EU exports, VN firms urged     

Vietnamese firms should step up efforts to boost exports to the EU despite facing several difficulties, a senior official said on Monday.

Dang Hoang Hai, head of the European Market Department under the Ministry of Industry and Trade, was speaking to the Vietnam News Agency on the even of Prime Minister Nguyen Xuan Phuc’s visit to Germany and Holland and participation to G20 Meeting (July 5-7).

He said EU was a large and potential market with 28 member countries and a total population of 500 million people. For several years, Viet Nam has enjoyed a trade surplus with the EU market, he noted.

In 2016, Viet Nam exported goods worth US$34 billion to the EU, 12 times the value in 2000, and paid $11 billion for imports from the bloc.

Hai noted that Viet Nam can enjoy benefits from the Generalised System of Preferences (GSP) for the 2017-2019 period. Many countries exporting to the EU do not have enjoy this preference.

When the Viet Nam-EU Free Trade Agreement (EVFTA) comes into effect, Viet Nam would have experienced 20 years of participating in the process of regional and international economic integration. Vietnamese enterprises have actively competed with rivals from other countries, he said.

Furthermore, a characteristic of the Viet Nam-EU import-export structure is that it is mutually complementary and less confrontational than direct competition, Hai said.

Commitments under the EVFTA on opening each other’s markets will be an important impetus for boosting Viet Nam-EU trade relations, as also an opportunity to further expand exports, especially of key items like textiles, footwear, agro-forestry and wooden products.

Meanwhile, Hai said, it must not be forgotten that the EU is a market with strict quality and safety standards that not many local firms can meet.

Viet Nam’s legal system and policies lack uniformity and stability, so local enterprises are at a disadvantage when it comes to international disputes and lawsuits.

Hai said Vietnamese enterprises are also not fully conversant about product origins, and with related rules in the FTA being very strict, the firms will not be able to comply with them.

Therefore, businesses need to actively adjust their supply chain and input materials to adhere to the rules of origin and enjoy preferential tax regimes under the EVFTA. These activities will also help them avoid investigations and other trade defense measures.

Local enterprises should actively reform and improve their ability in all fields, and enhance product quality to face future challenges, Hai said.

To boost exports to the EU, the Ministry of Industry and Trade has directed its trade offices in the EU member countries and relevant agencies to monitor market developments and identify solutions.

Hai also said that the ministry plans to encourage local enterprises directly joining the international distribution network.

SCIC posts $844m pre-tax profit     

The State Capital Investment Corporation (SCIC) has declared record pre-tax profit of around VND19 trillion (US$844 million) in 2016, which is 3.9 times the profit earned in 2013.

In its report on the business results in the period between 2013 and 2016, SCIC said its growth had increased continuously.

Its total revenue rose by 4.1 times from VND5.32 trillion in 2013 to VND22 trillion in 2016. Its contribution to the State budget increased 7.4 times from VND2.2 trillion in 2013 to VND16.5 trillion in 2016. Its revenue from selling its stakes in Vinamilk was more than VND10.8 trillion.

Between the period 2014 and 2016, SCIC poured VND13.4 trillion into investment, including VND6.05 trillion in bonds, VND1.86 trillion in shares and VND631 billion in newly established firms.

In addition to these, the corporation also invested VND1 trillion in Thai Nguyen Iron and Steel Joint Stock Corporation (TISCO) following the Government’s direction. However, SCIC divested from the project.

In 2016 alone, the corporation disbursed nearly VND1.2 trillion, including a capital contribution of VND18 billion in Viet Nam INCO JSC for No 29 Lieu Giai project, buying VND500 billion bonds of VPBank and VND100 billion bonds of ACB.

SCIC also increased its investment of VND4.5 billion in Trang Tien Plaza Co. Ltd. It has poured money into some other projects, such as industrial scale vaccine production project, cancer drug plant and hospitals.

In 2017, it planned to sell capital at 107 businesses in various sectors.

The corporation said the selling of State capital at businesses has been continuously promoted, thus bringing in the positive results. Last year, it successfully sold capital at both big scale firms and those with complicated and prolonged shortcomings.

Its business plan submitted to the Ministry of Finance was approved this year. Accordingly, SCIC planned to reduce half of its revenue target this year to VND11.2 trillion, with pre-tax profit of VND8.3 trillion and after-tax profit of VND7.3 trillion.

SCIC is scheduled to implement privatisation of five more enterprises by 2020, while continuing to hold capital in three others, selling capital in 137 firms and completing the dissolving of three companies. Among the 137 firms in which SCIC planned to sell State capital, there were big companies such as Vinamilk (39 per cent), Traphaco (36 per cent), DHG Pharmaceutical Joint Stock and Company (43 per cent), as well as Sa Giang Import-Export Company (50 per cent), Tien Phong Plastic Joint Stock Company (37 per cent), Binh Minh Plastic Joint Stock Company (30 per cent), Bao Viet Group (3 per cent) and MBBank (10 per cent).

SCIC said it would face difficulties in meeting the targets, though they were lower than that of last year. The main reason was that the list of State enterprises under Decision No 58/2016/QD-TTg that could be equitised has not been approved.

It said the enterprises management has been ensured and more effective. However, some firms have seen shortcomings and prolonged complication that had slowed the divestment process.

Dang Quyet Tien, Deputy Director of the MoF’s Corporate Finance Department, also said 19 firms had approved their equitisation process by the middle of June, slower than last year. 

High-quality product fair held in Quy Nhon     

A Vietnamese High-Quality Products Fair opens on July 4 in Quy Nhon City with 400 booths set up by 150 Vietnamese businesses.

To run until July 9, the fair has a section for exhibiting products meeting international standards and a “Green-Nice Market” where visitors can buy various regional specialities and enjoy activities like culinary and oil extraction performances.  

Organised by the High Quality Vietnamese Product Business Association, the fair also features other activities like a promotion offering over 1,000 different products at VND20,000 every day, game shows, a cooking contest and art performances.

Visitors will get more than 1,000 surprise gifts, including t-shirts, hats, pens, confectionary, fish sauce, soft drinks, and gas stoves from a truck driving around the exhibition from 8:30am to 9:30am daily.

The event is being held in a square in front of the Quy Nhon Trading Centre on Nguyen Tat Thanh Street. 

Quang Ninh’s export earnings increase by 6.7% in first half

The northern province of Quang Ninh earned US$749 million from exports in the first half of 2017, 45.3 % of its yearly goal.

According to the provincial Department of Planning and Investment, turnover was up 6.7% from a year ago. 

Notably, shipping 970,000 tonnes of coal raked in US$115.3 million, a year-on-year increase of 32%.

Other export goods that witnessed an increase included textiles, up 27.2 percent; wolfram, 27.3 percent, cement, 7.2%; candle, 9.7% and vegetable oil, 5.7%. 

Imports from local businesses during the period were valued at US$854.7 million, up 4.89% compared to the same period last year and representing 30.5 percent of the yearly plan. 

The locality also earned US$939 million, growing by 2.86% against the previous year, from temporary import and re-export activities.

Export value of forest products expected to exceed US$7.5 billion

The forestry sector aims for at least US$7.5 billion in export turnover and a 6.6% increase in production value in 2017, said Deputy Minister of Agriculture and Rural Development Ha Cong Tuan.

Addressing a conference held by the Vietnam Administration of Forestry on July 3, Tuan said that in the first six months of 2017, the sector basically fulfilled its assigned tasks and targets, which is expected to help increase the forest coverage to 41.45% this year.

However, the sector still faced several shortcomings. Despite decreasing deforestation, over 1,000 hectares were lost while the alternative afforestation progressed slowly, he noted.

He asked relevant agencies to exert efforts to deal with difficulties in forest production, and drastically implement the target programme on sustainable forestry development in 2016-2020 and complete a draft law on forest protection and development.

The official also stressed the need to have specific measures to plant alternative forests.

During January-June, the forest production value grew 5.29%. The export turnover of woodwork and forest products reached US$3.77 billion, up 12.7% year-on-year.

Vietnamese wood products have to date been shipped to over 100 countries and territories.

In the period, 40,612 hectares of alternative forests were planted, equivalent to 60% of the total area that needs to be covered.

Export value of forest products expected to exceed 7.5 billion USD

 The forestry sector aims for at least 7.5 billion USD in export turnover and a 6.6 percent increase in production value in 2017, said Deputy Minister of Agriculture and Rural Development Ha Cong Tuan.

Addressing a conference held by the Vietnam Administration of Forestry on July 3, Tuan said that in the first six months of 2017, the sector basically fulfilled its assigned tasks and targets, which is expected to help increase the forest coverage to 41.45 percent this year.

However, the sector still faced several shortcomings. Despite decreasing deforestation, over 1,000 hectares were lost while the alternative afforestation progressed slowly, he noted.

He asked relevant agencies to exert efforts to deal with difficulties in forest production, and drastically implement the target programme on sustainable forestry development in 2016-2020 and complete a draft law on forest protection and development.

The official also stressed the need to have specific measures to plant alternative forests.

During January-June, the forest production value grew 5.29 percent. The export turnover of woodwork and forest products reached 3.77 billion USD, up 12.7 percent year-on-year.

Vietnamese wood products have to date been shipped to over 100 countries and territories.

In the period, 40,612 hectares of alternative forests were planted, equivalent to 60 percent of the total area that needs to be covered.

Thua Thien-Hue’s aquaculture, fishing activities expanded

The central province of Thua Thien-Hue has seen recovery and development of the fishery sector after more than one year of the maritime environment incident.

In the first six months of 2017, the province’s seafood catching fetched nearly 19,000 tonnes, a rise of 25.5 percent year on year, while aquatic farming production reached 5,393 tonnes, up 4.2 percent.

Meanwhile, the total processed aquatic output so far this year hit nearly 3,250 tonnes.

Along with paying compensation for locals affected by the incident caused by Formosa that resulted in mass fish death in four central localities, the provincial Department of Agriculture and Rural Development has also rolled out measures to recover production and switch their livelihood.

Vice Chairman of the provincial People’s Committee of Phu Vang district Ho Viet Nhuan said that aquaculture and fishing activities in the district have been resumed and expanded. The district has instructed locals to utilise the compensation to stablise their livelihood, he said.

As many as 39,870 locals in Thua Thien-Hue are compensation receivers, with the highest number of 7,396 people in Phu Vang district. So far, 894.3 billion VND (39.3 million USD) out of total compensation sum of 950.5 billion VND (41.8 million USD) has been paid.

The mass fish deaths were first reported on April 6, 2016 when a large number of fish washed ashore in Ha Tinh province. It was also spotted in Quang Binh, Quang Tri and Thua Thien Hue provinces.

About 70 tonnes of dead fish were found in the four provinces and Thua Thien-Hue alone reported 35 tonnes of farm-raised fish had died. The pollution also affected more than 260,000 people who earn their living from the sea. 

In late June 2016, Taiwanese-invested Hung Nghiep Formosa Ha Tinh Steel Limited Company admitted responsibility for the incident and pledged 11.5 trillion VND (500 million USD) in compensation.

HCM City supports Siam Cement in making green building materials

Authorities of Ho Chi Minh City support the Siam City Cement Vietnam in producing environmentally friendly construction materials, a municipal official told executives of the Thai-invested firm on July 3.

Meeting with CEO Philippe Richart and Beat Wafler, member of the board of directors of the company, Vice Chairman of the municipal People’s Committee Le Van Khoa applauded the business’s attention to environmental protection in Vietnam. 

Valuing the firm’s successes in Vietnam, he stressed his city has high demand for construction materials to serve its urban development. He affirmed that HCM City always creates the best possible conditions for foreign enterprises, including Siam Cement group, to make long-term investment.

Philippe Richart said the Siam Cement group wants to continue promoting the sound cooperation with HCM City. Siam City Cement Vietnam pledges to protect the environment, carry out social responsibility, and ensure product quality during its operation in the country.

Briefing his firm’s activities, he noted Siam City Cement Vietnam will step up expanding its factory and distribution systems, manufacturing products that suit the Vietnamese market, and treating industrial waste.

Siam City Cement Vietnam specialises in construction material production and waste management in the southern region. It has about 1,700 workers directly and 20,000 others indirectly working at five cement factories and concrete mixing stations in HCM City.

Dak Lak becomes more attractive to investors

More and more domestic and foreign investors have poured cash into the Central Highlands province of Dak Lak in recent years, contributing to the local socio-economic development, according to the provincial People’s Committee.

In the first six months this year, Dak Lak lured 29 investment projects, with a total registered capital exceeding 1.47 trillion VND (64.68 million USD), increasing five projects and 2.8 times in value year-on-year.

The province also attracted one foreign direct investment (FDI) project worth 45 million USD during the period, raising its total FDI projects to 12.

The FDI projects, mainly in agricultural product and animal feed processing, planting flowers for export, trade, services and industry, came from the UK, Singapore, Japan, Netherland, France, Thailand, and the Republic of Korea.

The province has called for more foreign and domestic investment in hi-tech agriculture, processing industry, post-harvest agro-forestry-fishery preservation and large-scale livestock farms in tandem with food processing, renewable energy development and support industry.

Investment is also encouraged to go to hi-end resorts, ecotourism sites, hotels, supermarkets and trade centres.

Dak Lak has offered tax and land incentives for investors, particularly those investing in agriculture and rural areas.

It has also continued completing administrative reform to create a favourable, attractive and reliable investment climate for investors.

Coteccons to expand foreign ownership     

Coteccons Construction Corporation (Coteccons) (CTD) plans to raise its foreign ownership ratio cap from 49 per cent to 60 per cent, CTD leaders announced during its 2017 annual shareholders’ meeting held on Thursday in HCM City.

The board of directors will select the time of implementation as well as procedures related to the expansion. CTD’s foreign ownership ratio now accounts for just 3.63 per cent and CTD’s stock is currently most preferred by foreign investors. Therefore, the expansion plan is expected to increase liquidity and attract money inflowing into CTD, said Nguyen Ba Duong, CTD Chairman of the Board of Directors.

In 2017, CTD aims at a growth of 30 per cent in revenue, amounting to VND27 trillion (US$1.18 billion). Post-tax profits are estimated to reach VND1.7 trillion.

With strong business results in 2016, CTD decided to pay a cash dividend of 50 per cent in 2016. The company will retain 60 per cent of post-tax profits to supplement the development investment fund scheduled for the investment to the value chain of the construction sector to increase the CTD’s profit and maintain its sustainable development.

Regarding corporate governance, Duong said that by the end of June next year, CTD will have officially renewed corporate governance in accordance with the law and international practices.

CTD’s total number of employees has reached over 2,000, and the firm therefore needs to reorganise its apparatus in line with international practices to meet development requirements, Duong said.

Accordingly, Coteccons will remove the old supervision board and replace it with a new internal supervision sub-commission, which has been applied this year by the Viet Nam Dairy Products Joint-Stock Company (Vinamilk). Duong was previously elected as a member of Vinamilk’s board of directors at the company’s 2017 annual shareholders’ meeting.

The company has also established internal boards of economic, investment, financial supervisory and auditing, he added.

Duong said that CTD focuses firmly on human-centred developmen and continues to boost policies that balance benefits between employees and shareholders.

The company has been implementing a shares issuance programme under the employee stock ownership plan (ESOP), he said. Recently, CTD has issued a decision to revoke ESOP shares from employees who have quit their jobs.

At the same time, the company has generated policy encouraging key staff who contributed largely to the development of the company in 2016. The incentive value offered for employees was more than VND209 billion, equivalent to the number of ESOP shares of 2.5 million shares, representing 3.36 per cent of total shares circulating in the company.

However, in order to ensure the balance of interests between staff and shareholders, the Board members agreed to adjust the number of ESOP shares to limit the dilution of shares.

Accordingly, instead of issuing 2.5 million of ESOP shares, the company would issue only half of those shares, equivalent to nearly 1.3 million shares at the price of VND40,000 per share. This amount of stock is limited in transfer for two years from the date of issuance, Duong said.

Half of the incentive share amount will be paid in cash, he added. 

Mitsubishi launches new showroom in Binh Dinh Province     

Car maker Mitsubishi Motor Viet Nam has debuted a showroom in the central Binh Dinh Province’s Quy Nhon City, marking the ninth in the central and central highlands region and the 24th nationwide.

The company said the showroom, which was built on 3,000sq,m with total investment of VND30 billion (US$1.3 million), will provide global standard service, spare parts and accessories and maintenance service for the region’s market.

The Japanese automobile maker plans to work with the central city of Da Nang to produce battery-powered cars, high-quality health care service and information technology, as well as infrastructure projects.

In 2016, Mitsubishi Motors Viet Nam also debuted a new showroom Da Nang. 

Huế to invest US$52 million in agricultural restructuring

The central province of Thừa Thiên-Huế will invest VNĐ1.19 trillion (US$52 million) through 12 projects as part of its plan to restructure its agricultural sector with a vision till 2020.

Local authorities said the projects aimed to enhance the value of local agricultural products through sustainable development.

A report by the local Department of Agriculture and Rural Development said the projects would strengthen local advantages in agriculture. At the same time, they would be monitored closely to keep a check on environmental repercussions and the development of rural areas.

The projects include cultivation, husbandry, forestry, aquaculture, agricultural logistics and the processing industry.

One of the projects is the expansion of Thuận An fish port, where the harbour will be extended to accommodate more boats. Other projects include investments in aquaculture zones in Phong Điền, Phú Vang and Phú Lộc districts.

It includes a forestation project along the province’s coastline to reduce water salination in paddy fields near the sea. Another such project by the local forestry division aims to plant trees that will yield more timber.

The cultivation and husbandry sectors will work to form muster zones for cultivation and cattle breeding. In other projects, local authorities are looking at pushing for organic cultivation and developing a safe agro-product supply chain.

Provincial officials expect an annual production of 320,000 tonnes of agro-products and 73,000 tonnes of seafood by 2020. With this yield, local farmers’ incomes are expected to double compared to what they earn today.