BUSINESS IN BRIEF 6/10
No housing loan for civil servants
The State Bank of Viet Nam (SBV) last Wednesday denied offering a VND2-billion (US$95,200) credit package to high-income civil servants and soldiers who want to buy a house or apartment.
At a National Assembly meeting, SBV Governor Nguyen Van Binh said there was as yet no official plan to offer such a package.
According to the rumoured proposal, civil servants and soldiers with an average monthly income of more than VND25 million ($1,190) can borrow the money to purchase medium- and high-end terrace houses and apartments worth VND4 billion to VND5 billion ($190,500 to $238,000) each. A qualified household can borrow a maximum amount of $95,200, with an annual lending rate of six to 7.5 per cent, for a maximum 10-year period.
The loan could cover up to 75 per cent of the total value of the house or apartment to be purchased, and borrowers could use their own houses or apartments as mortgage.
The proposal has stirred a public debate. The infonet online newspaper quoted Nguyen Van Duc, vice chairman of HCM City's Real Estate Association, as saying there was no reason to offer such a package to civil servants, and wondered whether the package aimed to resolve a huge inventory of high-end property projects that remained unsold because they were too expensive.
He added that the proposal would not help low-income earners and suggested that the Government and real estate market instead provide VND500 loans to the people to enable them to buy medium-end apartments.
The SBV governor also revealed that as of September 20, the SBV has disbursed loans in its VND30-trillion ($1.42-billion) credit package to 7,823 borrowers. Of these borrowers, businesses numbered 26 while households and individuals made up the remainder.
According to Binh, banks committed VND5.9 trillion ($280 million) and disbursed VND3.2 trillion ($152 million) in loans. The disbursement was 3.5 times higher than that of the same period last year.
Beer consumption declines following tax hike: study
The consumption of beer in Viet Nam in Q1 this year fell by 7.5 per cent compared with last year following a 5-per cent increase in the product's special consumption tax.
The decline was noted in a report by the Industrial Policy and Strategy Institute (IPSI) on the importance of the beer industry to Viet Nam's socio-economic development. Released earlier this week, the report also found that although the country's gross domestic product (GDP) in the first quarter of this year grew by 4.96 per cent – the highest rate in the last three years — direct and indirect contributions from the beer industry posted declines, chinhphu.vn website report
Specifically, the production output fell by 8.2 per cent, consumption fell by 7.5 per cent and labour force fell by 10 per cent.
According to Director of the Ministry of Finance's Department of Tax Policies Pham Dinh Thi, tax policies, especially special consumption tax, has a significant impact on the beer industry.
Under the draft amended law on special consumption, the tax rate on beer was proposed to be raised from the current 50 per cent to 55 per cent on July 1, 2015; 60 per cent on January 1, 2017; and 65 per cent in 2018. This move was aimed at limiting beer consumption while increasing tax revenues.
The tax hikes were forecast to have an impact on the beer industry from the beginning of this year, including declines in production output, consumption, revenues and profits.
As the beer industry has played an important role in socio-economic development in the country, adding nearly VND21 trillion (US$990.6 million) to the State revenue last year, the report proposed that the tax increases should be rolled out gradually over three to five years to ensure enterprises and consumers adapt to the policy changes.
Da Nang to raise funds through bond issuance
Da Nang municipal authorities plan to raise VND1,100 billion (US$52.3 million) by issuing bonds this year for key infrastructure projects in the city.
The announcement was made at a conference on local authority bonds held last Wednesday by the Ha Noi Stock Exchange and Da Nang People's Committee.
According to the committee's standing vice-chairman Vo Duy Khuong, the purpose of bond issuance is to mobilize capital for socio-economic development in the city.
The projects in need of funding from bonds include Rong (Dragon) Bridge, Nguyen Van Troi – Tran Thi Ly Bridge, the High-tech zone, and Hoa Xuan Stadium.
One bond is scheduled to hold a value of VND100,000 ($4.76) and will mature in five years. Interest rates on bonds will be regulated according to Circular 81/2012/TT-BTC, issued by the Ministry of Finance.
The Ha Noi Stock Exchange is expected to hold a bond auction for Da Nang City on October 9.
ANZ at risk of losing out from SSI divestment
The investment of ANZ in Sai Gon Securities Inc. (SSI), if calculated in dollars, might prove to be unprofitable even after the bank divests from the Vietnamese brokerage.
In September 2007, ANZ spent US$88 million to buy 10 per cent of the company. Three months later, the SSI price reached about VND180,000 ($8.4) per share, which more than doubled the bank's average investment cost. However, the price of the stock plunged and hit a record low of just VND27,000 in 2008.
In order to cover the loss, ANZ bought more than 10 million SSI shares, thereby increasing its ownership to 17.5 per cent, and waited for the stock to rise again.
On Monday, ANZ announced it would divest completely from the securities company and sell its shares to domestic investors, including Nguyen Duy Hung, SSI chairman and chief executive officer.
ANZ's total investment in SSI is valued at $120 million. In the past seven years that it held the shares, ANZ received nearly $20 million in dividends. Therefore, for the bank to cover its loss, the upcoming sale must be at least $100 million, and the share price must be VND34,500, which is higher than SSI's closing value of VND31,000 yesterday.
According to SSI, ANZ decided to withdraw its capital because it wanted to concentrate on commercial banking operations in the Vietnamese market. Hung said the divestment would not affect his company's business strategy and would give SSI a huge opportunity.
He said a good number of foreign investors were interested in SSI as the company topped the market with increasing profits. It will also be a favourable opportunity for Hung to increase his holdings. He has an 8.2-per cent stake in SSI.
"Since the shares will not be sold in the public market, it will not directly affect SSI share value," he added. Hung and his brothers have registered to buy 29.3 million shares, or an 8.3-per cent stake. The transactions will be conducted in November.
Apart from ANZ, other foreign shareholders of SSI include Japan's Daiwa Securities and Ukraine's Dragon Capital, with 10 per cent for each.
Panama firms interested in co-operation with Viet Nam
Firms from Panama are interested in doing business in Viet Nam in various fields including education, health, agriculture, tourism and industry.
About 30 Panamanian entrepreneurs enquired about Viet Nam's investment climate at a September meeting hosted by the Vietnamese Embassy in Panama. Many said they intended to visit Viet Nam in the near future to explore co-operation opportunities in agriculture and rural development as well as other fields.
Ambassador Nguyen An Duy reviewed the development of relations between the two nations since 2013, saying there was large potential for boosting bilateral ties.
Documentaries featuring the Vietnamese land, people, culture, and economics were also screened at the function.
Hanoi's property market sees slight recovery in Q3
The capital city's property market, including the condominium market, recovered slightly in the third quarter of 2014 because of positive economic factors.
According to its report on the capital city's property market for the third quarter which it released in Hanoi on October 2, CBRE Vietnam Company Ltd., a foreign property service provider, said the country's gross domestic product (GDP) grew by 5.62 percent in the first nine months of 2014.
GDP growth, coupled with accelerating foreign investment, helped to boost manufacturing and exports and helped the country to counter low credit growth, the report added.
It quoted the State Bank of Vietnam as saying that by the end of August 2014, credit to the real estate market had expanded by 9.85 percent compared with that at the beginning of this year. This is higher than the 5.82-percent credit growth for the entire economy, as well as the credit growth for other sectors.
It also cited the ANZ-Roy Morgan consumer survey, which showed that domestic consumer confidence closely followed domestic stock market trends, with both increasing since January.
According to the survey, nearly 60 percent of respondents expect economic conditions in Vietnam and their personal family situations to improve next year. A recovery in consumer confidence may give some grounds for optimism in terms of credit growth for the last three months of the year, the report added.
Apart from the recovery in domestic consumer confidence, manufacturing supported the country's overall positive economic performance and remained the most significant sector for foreign direct investments (FDI), accounting for nearly 70 percent of total FDI. The country's real estate sector ranked second with 1.2 billion USD, or 11 percent of total FDI.
"The positive economic factors in the third quarter of this year have promoted recovery of the capital city's property market, including the market of condominiums for sale," said Nguyen Hoai An, senior manager of CBRE Vietnam's Hanoi branch.
In the third quarter, the condominium market continued to witness active property launches and re-launches even during the so-called "ghost" month which, in the traditional Eastern mindset, is a time for refraining from business activities, the company said.
A total of 2,202 condominium units from six projects were added to the supply, and most of them were from the low-end segment. This pushed the total new supply of condominiums for the first nine months of this year to 6,829 units, surpassing the 6,745 units launched in the entire 2013.
Meanwhile, medium-end projects were actively re-launched, with massive promotion programmes that included interior design packages, car plans and deferred payment schemes, as most of these projects were already completed and buyers could move in immediately.
Sales momentum still remained strong despite the ghost month tradition. An estimated 2,550 units were sold in the quarter, a slight increase of approximately two percent compared with that of the last quarter.
Sales for medium-end projects improved by 30 percent while those for low-end projects declined as buyers moved up the price brackets and favoured completed projects. The total number of units sold for the first nine months reached 6,550, a 66-percent year-on-year increase.
"Transactions for medium-end projects increased because of the high demand in this segment, and the supply of the medium-end projects has always accounted for a large volume of the market," An said.
In terms of primary pricing, a slight two- to five-percent year-on-year increase in indicated tag prices were seen in the new launches of some medium- and low-end projects, especially the completed ones, An noted.
"Although promotions of higher value are on offer, the increase in tag prices shows that developers were more confident in the market and in the positioning of their projects," she added.
The prices of apartments for re-sale likewise witnessed a slight one-percent quarter-on-quarter increase. Re-sale prices improved in most segments, with the strongest seen in medium-end apartments with a 1.8-percent quarter-on-quarter surge. In the first and second quarters, an increase in re-sale price was stronger in the luxury and high-end segments.
Vietnam – promising market for UK businesses
Fiona Woolf, Lord Mayor of the City of London, and the UK’s leading businesses will have a working visit from October 5-7 to Vietnam, an important market for British investors.
Woolf expressed her delight to have opportunity to visit the Southeast Asian nation during her mayoral year.
“As Lord Mayor, my role is to act as an ambassador for the UK’s financial and professional services community and to promote stronger trade between our two countries,” Woolf said.
According to the Lord Mayor, this is a crucial moment for the UK’s economic relationship with Vietnam, that there are many opportunities for both to stimulate growth by working more closely together.
Vietnamese import demand is expected to grow by around 250 percent this decade – faster than any other emerging power, and which is one of the reasons why it has been listed as one of UK Trade and Investment’s 20 high-growth markets, which have been prioritised given their particularly strong potential for UK businesses to work with local companies.
Meanwhile, the UK is home to many of the leading experts in key areas for growth in Vietnam, especially in the financial and professional services sector.
Financial and professional services are important to the development of the wider economy, and although many UK firms already operate in Vietnam, creating stronger partnerships between the two countries will allow more British firms to begin delivering these crucial services to Vietnamese customers and with Vietnamese partners.
However, she said, the development of financial services access across the population is not the only way in which the UK can contribute to Vietnam’s booming economy.
UK firms possess both experience and capability of planning, structuring, financing and managing major infrastructure projects, expertise that would be beneficial to major infrastructure projects in Vietnam.
The UK has long been the partner of choice for PPP projects, she said, adding with so many opportunities emerging particularly in Ho Chi Minh City with urban regeneration this is the perfect opportunity to deepen the engagement and work more closely together to ensure that these projects are completed on schedule and are well financed.
The region’s thriving oil and gas sector is another area in which cooperation between UK and Vietnamese companies can bring economic benefit for both nations, she affirmed.
“Vietnam is South-east Asia’s third largest oil producer and UK companies have the technological expertise needed to help the industry move forwards into a new era of sustainable oil production and renewable energy development,” she said.
Crucial to this partnership is an investment in skills, Woolf stressed, saying “I know how important investing in education is to Vietnamese businesses as they look to develop in the future.”
According to the Lord Mayor, there is huge potential for partnerships, as the UK has a strong tradition in financial and professional education, training and qualifications (ETQ), covering a broad range of financial and professional services disciplines. UK-based professional bodies can assist to develop enhanced capabilities across the financial and professional services sector.
During her upcoming Vietnam visit, Woolf will present a Mansion House scholarship to offer a Vietnamese student the chance to study in London and build on the strong cultural ties that have already developed between the two nations.
As only the second female Lord Mayor in 800 years, Woolf has spent a good part of her mayoral year supporting equality and diversity.
“To get the best ideas, the most dynamic organisations and the greatest application of intellectual capital, we must have diversity in every possible way,” she said, adding “we must ensure that we do not discriminate against gender or background if we are all to meet our full economic potential.”
She expressed her hope that her visit would bring many opportunities for Vietnamese businesses to deepen their ties with the UK business community and that the two countries will be able to cement the next generation of their ties.
VN consumers increasingly favour locally made products
The “Vietnamese people prioritize using Vietnamese goods” campaign has been very successful in building customer trust in the quality of Vietnamese products.
The radio Voice of Vietnam (VOV) quoted a recent survey by the Steering Committee for the campaign in Ho Chi Minh City as saying that over 96 percent of surveyed people said they have gained confidence in the overall quality of Vietnamese products.
According to Deputy Director of Hanoi Department of Industry and Trade, Tran Thi Phuong Lan, the “Vietnamese people prioritise using Vietnamese goods” campaign has increased public awareness and confidence in the Made-in-Vietnam brand.
Roughly 62.8 percent of respondents said they have recommended their friends and relatives to purchase Vietnamese goods. While 28.15 percent of respondents said they have opted more often to purchase Vietnamese goods over foreign products and services.
According to the survey, over the past five years, the Vietnamese purchasing power for domestic products has increased from 50 percent to 85.8 percent. Around 52.5 percent of respondents said at least 80 percent of their consumption goods were locally made products.
The localization rate of material inputs have also surged by 25 percent, which bodes well for the long-term prosperity of the national economy, according to the survey.
However, Industry and Trade Deputy Minister Ho Thi Kim Thoa also said fake goods are still sold on the Vietnamese market. These fake goods are costing Vietnamese firms huge of money, workers’ jobs and damaging the country’s economy. The Deputy Minister called for drastic measures to tackle that thorny issue.-
Binh Duong province established as processing hub
The processing industry in the southern province of Binh Duong generated 130 trillion VND (nearly 6.2 billion USD) during this years’ first three quarters, up by 13.6 percent compared to last year, turning the locality into Vietnam’s processing hub.
The processing industry represented 98 percent of the province’s production value, which totalled more than 131 trillion VND (over 6.23 billion USD), a 14 percent increase since 2013. The remaining 2 percent of production value - 1 trillion VND - was generated by the mining sector, Vo Van Cu, Director of the provincial Department of Industry and Trade, said.
Growth was recorded primarily in the sectors that process export products, such as footwear and handbags (27 percent increase), wooden products (27 percent increase), rubber and plastic goods (24 percent increase), and animal fodder (5-18 percent increase).
Recently, Binh Duong adjusted its socio-economic development plan for 2020 with a focus on processing and high-tech industries to accelerate sustainable industrialisation.
Binh Duong is located in Vietnam’s southern key economic region, which also encompasses Ho Chi Minh City and six other provinces.
Cashew nut price expected to rise in 2015
The Vietnam Cashew Association (Vinacas) predicted an increase in the price of raw cashews in 2015 due to a growing demand for the nut for export and processing purposes.
Vinacas urged domestic cashew businesses to establish a brand reputation by ensuring quality control and keeping to delivery dates, while producers should apply sound cultivation techniques to improve the quality of nuts.
During the first eight months of 2014, export volume for processed cashews reached 198,743 tonnes, worth 1.29 billion USD. This represents increases of 20.2 percent in volume and 21.5 percent in value compared to the same period last year.
Vietnam has 338 cashew processors who export their products to more than 80 countries and territories worldwide.
The US, China and the Netherlands are Vietnam’s biggest cashew importers.
In 2013, cashew exports brought home 1.8 billion USD.
Spanish businesses look towards Vietnamese market
Leaders of nine businesses in the Spanish Region of Basque Country are visiting Vietnam and Singapore from October 6-10 to seek business opportunities and boost their exports of machinery and marble, according to Bilbao City’s Chamber of Commerce.
With a population of 91 million, Vietnam is attractive to the Spanish region’s enterprises due to its dynamic economy, GDP growth rate and political and social stability, a press release issued by the chamber stated.
After recording a trade deficit for two years in a row, the Basque Country enjoyed a trade surplus with Vietnam in 2013, with export revenue reaching 20.2 million EUR and imports valued at 14 million EUR.
However, during the first seven months of this year, the region generated 8.3 million EUR in revenue from selling Spanish products to Vietnam, whilst spending 9 million EUR on Vietnamese commodities.
Southern province’s monthly exports top 1 bln USD
Dong Nai province’s exports increased by 16 percent during the first nine months of this year to a total of 9.2 billion USD, which means the southern locality shipped more than 1 billion USD worth of goods each month.
In September, export turnover was estimated at more than 1.15 billion USD, according to data from the provincial Statistics Department.
Dong Nai’s export is forecast to continue on its upward trend since a number of businesses received orders until the end of 2015’s first quarter already.
At the end of this year’s third quarter, the province enjoyed a trade surplus of around 300 million USD with increases in the export of industrial products, such as footwear, textile and garments, wood products, vehicles and spare parts.
Le Van Danh, Director of the provincial Department of Industry and Trade, attributed this to the increased demand from the US, the European Union and Eastern Europe, the number of free trade agreements enforced, various promotional campaigns, and the regular dialogues held with the business circle.
Dong Nai province, Ho Chi Minh City, Tay Ninh province, Ba Ria-Vung Tau province, Binh Duong province, Binh Phuoc province, Long An province, and Tien Giang province form Vietnam’s southern key economic region.
Rice production aims for higher value added industry
Together with cashew nuts and coffee, the rice production has been selected by the Ministry of Agriculture and Rural Development as Vietnam ’s advantageous and strategic crop under agricultural restructuring project until 2020, the Vietnam Economic News reported.
Vietnam aims to improve the competitiveness of Vietnam ’s rice products and to boost production in a sustainable manner, said Deputy Director of the Cultivation Department under the Ministry of Agriculture and Rural Development (MARD) Pham Dong Quang.
To implement this project, in 2013 alone, 13 provinces in the Mekong Delta built 369 large-scale rice fields on total area of 120,500ha while the Red River Delta provinces built 1,265 large-scale rice fields on total area of 35,518ha, focusing mainly in Nam Dinh and Thai Binh provinces.
This year, the large-scale rice field model has been expanded throughout the country on hundreds of thousands of hectares. In the summer-autumn season 2014 in the Mekong Delta alone, enterprises coordinated with farmers to grow and consume rice products on 100,000ha.
The restructuring project also showed that in the coming time, the rice growers will use more rice varieties of high quality, high yield that could meet the market demand and sell at high prices. Accordingly, the Mekong Delta’s rice will target for exports while the Red River Delta’s rice will mainly serve the domestic market.
To improve the competitiveness of Vietnam ’s rice products, farmers need to establish associations that represent farmers in building policies and negotiating purchase prices, said Pham Dong Quang. He also noted that Vietnam should encourage domestic and foreign enterprises ( Japan , the Republic of Korea ) to hire land to produce rice for domestic consumption and or export to third countries or export back to these countries.
The restructuring project also mentioned the support for enterprises to develop their trademarks in a bid to maintain traditional export markets and explore new markets like Northern Africa or Eastern Asia.
Can Tho achieves US$616 trade surplus in 9 months
The Mekong Delta province of Can Tho has gained a record trade surplus of US$616 million in the first nine months of 2014, according to the provincial Planning and Investment Department.
For the nine month period, exports were estimated at US$914 million and imports hit US$298 million.
Rice and seafood-the two key exports reached 532,000 tonnes and 70,000 tonnes, respectively.
Other products such as garments and textiles, pharmaceuticals, art and handicrafts, footwear, iron and steel, fruits and canned mushrooms achieved total export earnings of US$181 million, up 29% on-year.
Agro Viet 2014 to promote farm produce bands
More than 200 local and foreign businesses are expected to showcase their products in 450 stalls of the 14th International Agriculture Trade Fair in Vietnam (Agroviet 2014) scheduled for November 14-17 in Hanoi.
The information was unveiled at a press conference regarding the fair in Hanoi on October 3.
Agricultural Trade Promotion Centre director Dao Van Ho said several foreign businesses like Japan, China, joint ventures, multinational companies, and non-governmental organisations and foreign embassies in Vietnam have registered for the event so far.
The event is designed to help businesses and individuals develop product brands, share experiences in science and technological advances and honour Vietnamese high quality agro-forestry-fishery products which ensure food hygiene and safety and are environmentally friendly. A series of events are planned during the fair, including a seminar, to strengthen links from production to consumption of farm produce and connect sustainable value chains and a trade exchange program between Vietnamese and Japanese businesses.
AgroViet 2014- the biggest annual event of Vietnam’s agricultural sector is organised by the Trade Promotion Centre for Agriculture (AGRITRADE) under the Ministry of Agriculture and Rural Development.
Malaysia, Vietnam share FDI attraction experience
Deputy Minister of Planning and Investment Nguyen Van Trung on October 2 worked with Malaysian Investment and Development Agency (MIDA) CEO Ahmad Khairuddin Abdul Rahim, head of the MIDA delegation.
Trung is on a two-day working visit to Malaysia to learn from the country’s investment attraction experience aiming to increase bilateral cooperation in this field.
Both sides introduced their respective models for planning and developing industrial and economic zones.
They also studied each other’s policies and coordination mechanisms between state agencies that support industrial zones, especially in the areas of land management, natural resources, the environment, investment, trade, export, tax and customs.
MIDA shared their FDI attraction experience in Malaysian industrial zones, particularly in high-tech zones, green production industries and a skilled workforce.
While staying in Malaysia, the Vietnamese delegation also visited Pulau Indah industrial zone in Selangor state, a complex that comprises an industrial zone, trade centres and residential buildings.
Siemens AG establishes the first project execution hub for power plants in Vietnam
Vietnam has just been selected by Siemens AG, a leading contractor in supply and installation of combined cycle power plants (CCPP) worldwide, to establish a project execution hub with qualified staff to work in site management, construction, erection, commissioning, environment health and safety and quality control for supporting power plant projects of Siemens in Asia and the Middle East.
The move was to help the German-based technology powerhouse to enlarge the global expert pool for site execution as well as to increase competitiveness and strengthen presence in Asia, according to a company statement released October 1.
Employed Vietnamese engineers will run through a training programme in order to gain theoretical know-how at Siemens headquarters in Germany and to gain practical experiences at different power plant project sites worldwide.
After the completion of the training programme, they will be delegated abroad to implement Siemens projects in the Asian and Middle East regions where they will work in a healthy and employee-friendly environment with a lot of opportunities for professional and personal development.
They are also entitled to enjoy a remuneration and benefit package according to international standards.
“I am very proud to witness a very strong combination: high tech made in Germany implemented by skilled and diligent Vietnamese Engineers. The opening of this hub in Vietnam is another evidence of our long term commitment and our strong believe in a bright future of Vietnam,” said Pham Thai Lai, president and CEO of Siemens Vietnam.
Siemens AG is active in more than 200 countries, focusing on the areas of electrification, automation and digitalisation. In fiscal 2013, which ended on September 30, 2013, its revenue from continuing operations totaled €75.9 billion ($95.6 billion) and income from continuing operations €4.2 billion ($5.3 billion). At the end of September 2013, Siemens had around 362,000 employees worldwide.
PwC, CIO and CSO Global State of Information Security® Survey 2015 released
The number of reported information security incidents around the world rose 48 per cent to 42.8 million, the equivalent of 117,339 attacks per day in 2013, according to The Global State of Information Security® Survey 2015, released recently by PwC, in conjunction with CIO and CSO magazines.
Detected security incidents have increased 66 per cent year-over-year since 2009, the survey data indicates.
“It’s not surprising that reported security breach incidents and the associated financial impact continue to rise year-over-year,” said David Burg, PwC’s Global and US Advisory Cybersecurity leader.
“However, the actual magnitude of these breaches is much higher when considering the nature of detection and reporting of these incidents,” he added.
As security incidents become more frequent, the associated costs of managing and mitigating breaches are also increasing. Globally, the estimated reported average financial loss from cybersecurity incidents was $2.7 million – a 34 per cent increase over 2013.
Big losses have been more common this year as organisations reporting financial hits in excess of $20 million nearly doubled.
But despite elevated concerns, the survey found that global information security budgets actually decreased four per cent compared with 2013. Security spending as a percentage of IT budget has remained stalled at 4 per cent or less for the past five years.
“Strategic security spending demands that businesses identify and invest in cybersecurity practices that are most relevant to today’s advanced attacks,” explained Mark Lobel, PwC Advisory principal focused on information security. “It’s critical to fund processes that fully integrate predictive, preventive, detective and incident-response capabilities to minimise the impact of these incidents.”
Organisations of all sizes and industries are aware of the serious risks involved with cybersecurity; however, larger companies detect more incidents.
Large organisations – with gross annual revenues of $1 billion or more – detected 44 per cent more incidents this year. Medium-sized organisations – with revenues of $100 million to $1 billion – witnessed a 64 per cent increase in the number of incidents detected. And while risk has become universal, the survey found that financial losses also vary widely by organisational size.
“Large companies have been more likely targets for threat actors since they offer more valuable information, and thus detect more incidents,” said Bob Bragdon, publisher of CSO.
“However, as large companies implement more effective security measures, threat actors are increasing their assaults on middle-tier companies. Unfortunately, these organisations may not yet have security practices in place to match the efficiency of large companies,” he noted.
Other finding is that insiders have become the most-cited culprits of cybercrime – but in many cases, they unwittingly compromise data through loss of mobile devices or targeted phishing schemes.
Respondents said incidents caused by current employees increased 10 per cent, while those attributed to current and former service providers, consultants and contractors rose 15 per cent and 17 per cent, respectively.
“Many organisations often handle the consequences of insider cybercrime internally instead of involving law enforcement or legal charges. In doing so, they may leave other organisations vulnerable if they hire these employees in the future,” added Bragdon.
Meanwhile, high profile attacks by nation-states, organised crime and competitors are among the least frequent incidents, yet the fastest-growing cyber threats. This year, respondents who reported a cyber-attack by nation-states increased 86 per cent – and those incidents are also most likely under-reported.
The survey also found a striking 64 per cent increase in security incidents attributed to competitors, some of whom may be backed by nation-states.
Effective security awareness requires top-down commitment and communication, a tactic that the survey finds is often lacking across organisations. Only 49 per cent of respondents say their organisation has a cross-organisational team that regularly convenes to discuss, coordinate, and communicate information security issues.
PwC notes that it is critical for companies to focus on rapid detection of security intrusions and to have an effective, timely response. Given today’s interconnected business ecosystem, it is just as important to establish policies and processes regarding third parties that interact with the business.
“Cyber risks will never be completely eliminated, and with the rising tide of cybercrime, organisations must remain vigilant and agile in the face of a constantly evolving landscape,” said PwC’s Burg.
“Organisations must shift from security that focuses on prevention and controls, to a risk-based approach that prioritises an organisation’s most valuable assets and its most relevant threats. Investing in robust internal security awareness policies and processes will be critical to the ongoing success of any organisation,” he underscored.
The Global State of Information Security® Survey 2015 is a worldwide study by PwC, CIO and CSO. It was conducted online from March 27, 2014 to May 25, 2014.
Readers of CIO and CSO and clients of PwC from around the globe were invited via e-mail to take the survey. The results discussed in this report are based on responses of more than 9,700 CEOs, CFOs, CIOs, CISOs, CSOs, VPs, and directors of IT and security practices from more than 154 countries.
Banking sector to see two M&A deals
The State Bank of Vietnam (SBV) has approved a policy to merge Southern Bank into Sacombank and Mekong Bank into Maritime Bank, said Governor Nguyen Van Binh at Q&A session of the National Assembly’s Standing Committee.
Tycoon Tram Be and his family are holding a large ratio in both Sacombank and Southern Bank, exceeding ownership ceiling levels in the 2010 Law on Credit Institutions.
The two banks’ merger as a result will be a chance to deal with the beyond ceiling ownership ratios and cross-ownership also.
However, Sacombank will have to bear Southern Bank’s bad debts that were about 4 percent by the end of 2013.
It is not clear whether Singaporean United Overseas Bank Limited (UOB), a strategic shareholder of Southern Bank, will withdraw capital from the bank after the merger.
In the second case, Maritime Bank is holding 10.16 percent shares of Mekong Bank and the two banks’ shareholders have soon agreed with the merger plan.
The new bank will have chartered capital of VND11,8 trillion including VND8 trillion of Maritime Bank and total asset worth VND113 trillion.
Bad debts in Mekong Bank have been controlled below 3 percent in recent years.
Singaporean Fullerton Financial Holdings-FFH holding 20 percent of the Mekong Bank’s shares has completed capital withdrawal, according to a news source from the State Bank.
The State Bank has permitted FFH to transfer its shares to Maritime Bank.
FFH leader said they would find another Vietnamese partner to boost its development strategy.
According to reports by the State Bank to the NA Standing Committee, nine weak commercial banks have been determined since 2012. SBV has approved eight restructuring projects and will soon submit the Prime Minister another for the rest bank.
MoIT optimistic about 2014 goal realisation
The Minister of Industry and Trade (MoIT) is likely to fulfil all the set targets for 2014, with industrial production index rising 7-7.2 percent, exports growing 12 percent to 148 billion USD and retail revenue expanding by 12 percent, said Minister Vu Huy Hoang.
Reporting to Prime Minister Nguyen Tan Dung on the ministry’s performance over the past nine months, Hoang said all indicators were higher than the same period a year just gone.
Industrial production index rose 6.7 percent, while exports inched up 14.2 percent to hit 109 billion USD, generating a trade surplus of nearly 2.5 billion USD, he noted.
Total earnings of the retail and service sectors were estimated at 2.1 billion USD, a rise of 11.12 percent year on year, said the minister.
Meanwhile, the ministry has stepping up the equitisasion and non-core capital withdrawal of its State-owned enterprises, with good results seen in the Vietnam National Textile and Garment Group and the Vietnam National Coal- Mining Industries Group, he said.
Concluding the working session, PM Nguyen Tan Dung asked the ministry to pay special attention to completing the market economy institution, thus making the environment more competitive, transparent and equal.
He urged the ministry to ensure the stable supply of power, fuel and coal, which are major counterbalances of the economy.
Regarding the restructuring of enterprises, especially State-owned firms, he underscored the necessity to follow a specific roadmap with high determination.
The Government leader also requested the ministry to continue efforts to expand both domestic and foreign markets, while speeding up the campaign to encourage Vietnamese people to prioritise Vietnamese products.
At the same time, it is crucial to make full use of all opportunities created by existing free trade agreements, while staying active in the process of negotiations for new deals, he added.
Quang Nam aims to attract more domestic visitors
The tourism industry in the central coastal province Quang Nam will pay more attention to attracting domestic visitors in the time ahead in order to regain growth pace, according to the Director of the provincial Department of Culture, Sports and Tourism Dinh Hai.
At the same time, the provincial authorities will create all possible conditions for tourism agencies to improve the diversity and quality of services while increasing destination linkages within the region.
Local infrastructure will continue to be upgraded in order to meet the increasing demands of tourists.
Statistics show that the coastal province welcomed approximately 3 million visitors during the first nine months of this year, up by 7 percent year-on-year, with 1.4 million being domestic holiday makers. Tourism revenue so far totals 3.5 trillion VND (165 million USD).
The recognition of world heritage sites has boosted the province’s potential for tourism development. It is home to three famous attractions - the World Cultural Heritage Sites of Hoi An Ancient Town and My Son Sanctuary, and the World Biosphere Reserve surrounding the Cham Islands.
Hoi An Ancient Town, recognised by UNESCO in 1999, is an old trading port that dates back to the 15th century. Its architecture and layout reflect the indigenous and foreign influences that melted together to produce the unique character of the town.
My Son Sanctuary is a cluster of abandoned and partially ruined Cham temples. Constructed between the 4th and the 13th century AD, it used to be the religious and political capital of the Champa Kingdom.
The Cham Islands (Cu Lao Cham) constitute a group of eight islets, which form part of the Cu Lao Cham Marine Park, a World Biosphere Reserve recognised by UNESCO. The islands are well-known for their rich marine ecosystems with 135 species of coral, as well as beautiful sand beaches and forested hills.
Tourism sector aims to tap new markets
Local travel agencies are cannoning attention to new markets including Indonesia, India and Russia beside traditional ones such as the US, Europe, China and Japan as the former group is forecast to generate great numbers of visitors, the Saigon Times Daily reported.
Phan Dinh Hue, Director of Viet Circle Travel, said the company has turned to Indonesia and India since the beginning of this year with positive results. Partners from each of the nations have booked four or five trips for one month.
Similarly, some other travel firms said they can open short-term tours for Indonesian tourists thanks to affordable air fares and high frequency of flights between the two countries.
More and more local companies are now also seeking to tap India as a new market. They expect a surge in the number of Indian tourists when Vietnam Airlines launches direct air routes linking the two countries in the near future.
For the new markets, Russia remains the fastest-growing visitor-generating market for Vietnam.
Hoang Thi Phong Thu, Chairwoman of Anh Duong Co., said the company is working with Russia’s travel firm Pegas Touristik to further tap this fast-growing market. By the end of this year, Russian tourists will come to Vietnam in droves by chartered flights with an estimated seven or eight trips a day.
“By the end of this year, we should have catered to 250,000 Russian visitors,” she was quoted as saying.
On the contrary, the number of Chinese people booking tours to Vietnam has yet to recover fully following a sharp decline since May due to the East Sea tensions triggered by China’s illegal placement of an oil rig in Vietnam’s waters.
Arrivals from other traditional markets have been in decline as well.
Bui Viet Thuy Tien, Managing Director of Asian Trails Co., Ltd, said the number of year-end tours booked in advance at her company dropped in August and September due to fewer tour buyers from Europe. As such, the company is likely to cut this year’s growth rate to less than the targeted 5 percent.
According to the General Statistics Office, foreign arrivals in Vietnam were over 6.06 million in the January-September period, a year-on-year rise of 10.4 percent thanks to the strong growth recorded in the year’s first half.
Vietnam jumps five places on 2014 global innovation ranking
Vietnam is ranked 71th among 143 countries on innovation, up five notches from the previous year, according to a report by the World Intellectual Property Organisation (WIPO).
The Global Innovation Index (GII) report, co-published by WIPO, the European Institute for Business Administration and Cornell University, said Vietnam ranked fourth in the ASEAN region with a score of 34.89.
Singapore, Malaysia and Thailand achieve the highest scores in ASEAN, ranking 7th, 33rd and 48th respectively.
Globally, the first place belongs to Switzerland, followed by the United Kingdom and Sweden.
The GII uses 81 indicators to gauge innovation capacity, competitiveness, and the strength of national innovation ecosystems.
Sacombank, MPOS launch card payment service
Saigon Thuong Tin Commercial Bank (Sacombank) and MPOS Vietnam Technology Joint Stock Company have introduced a card payment service via mobile devices for small enterprises, stores and family-run businesses.
The companies said mPOS.vn can match various devices such as smartphones and tablets connected to the Internet and 3G service with fees much lower than normal points of sale (POS).
In addition, the service does not require a minimum revenue level for users. For a traditional POS, users usually have to secure a minimum transaction revenue a month and so this is only suitable to medium and high-revenue businesses.
On the occasion, MasterCard has also announced a cooperation program with mPOS.vn and Sacombank to develop a strong mPOS.vn card payment network in the first year. They will also provide payment training to customers.