16,000 firms suspend operations in first two months of 2015

More than 2,055 firms had completed procedures to dissolve their companies and 14,040 firms suspended operations in the past two months of 2015, signifying respective increases of 8.7 per cent and 25 per cent compared to the same period last year, according to newswire dddn.com.vn.

Remarkably, 9,515 units of the group above are limited liability companies; 2,292 units are joint stock companies and 2,233 units are private businesses.

Most of the above businesses having difficulty in their operations are small-scale businesses with total capitals under VND10 billion ($468 million).

However, in the first two months of 2015, 4,376 firms restarted operations, resulting in a 20.2 per cent on year. A number of outstanding activities having spectacular returns are education (up 39.5 per cent; mining (up 46.3 per cent); real estate business (up 52.8 per cent) and finance, banking and insurance (up 115.8 per cent).

Furthermore, the number of newly-established businesses are 13,766 with a total aggregate capital of VND77.5 trillion ($3.6 billion), a 26.6 per cent in terms of numbers and 23.3 per cent in terms of capital compared to the same period in 2014.

Vinafood 1 massive divestment wave

According to a company recent report, Vietnam Northern Food Corporation (Vinafood 1) will conduct an auction for its divestment of Hanoi-Nam Dinh Beer Joint Stock Company (JSC), Southern Salt Group (Sosal Group) and Northeast Food JSC in March.

Notably, Vinafood 1 will sell 86,940 shares at Hanoi- Nam Dinh Beer SJC for the initial bid price of VND11,460 ($0.54) per share. This company has total chartered capital of VND20 billion ($936,880) and specialises in producing beer, alcohol and other beverages. Apart from these, it expanded its operation to food processing, restaurant management and tourism.

Vinafood 1 divestment will also include selling 177,845 Sosal Group shares for a starting price of VND11,100 ($0.52) per share. Sosal Group’s chartered capital is VND500 billion ($26 million) and its main business profile involves producing and trading salt and salt-based finished products.

On March 12, the company will divest Northeast Food JSC by auctioning more than 1.3 million shares.

In February, Vinafood 1 carried on divesting at its other subsidiaries such as Ha Son Binh Food JSC, Song Hong Food JSC, Hai Duong Vinafood 1 JSC and Nam Dinh Food JSC.

Vinafood 1 is one of Vietnamese leading companies in purchasing, processing and trading food, agricultural products; agricultural materials, fertilizer and finished products for animal feed.

Apart from the above, the company is keen on expanding its profile to  processing and trading rice, salt, confectionery.

In 2014, the company acquired a total revenue of VND9.8 trillion ($459 million) with a total pre-tax profit of VND233 billion ($10.9 million) and an export turnover of $151 million.

New uniforms for Vietnam Airlines meet mixed reception

New uniforms for Vietnam Airlines flight and cabin crew have been met with criticism, but also credit for the change, from the public and leading designers and models.

The new uniforms, designed by Minh Hanh as part of the airline's campaign to become a regional leader over the next five years, dress pilots and male crew in white shirts with a lotus motif, the airline logo, and the word “Van” or “Ten Thousand”, a symbol for peace and fortune, and the largely female flight attendants will wear a long dress design featuring a stylised lotus, symbolising vitality and nobility.

However, many members of the public said that the new uniforms, especially uniforms for flight attendants, were not as appealing as the uniforms they replaced.

“The new long dresses make them look like they work in a restaurant, and the new colour is faded and melancholy,” one person said.

Model Ha Anh said, “The new long dresses are ugly and plain."

Another member of the public said, “The new uniform may make foreign passengers think badly of Vietnam’s fashion."

Some said the new uniforms for male pilots and crew were better.

Vietnam Airlines did get some credit for the change. “I’ve travelled a lot and many airlines are changing uniform designs, going for a lighter, more colourful and elegant feel for the cabin space," said Ngoc Han, who was Miss Vietnam 2010.

Designer Thuan Viet said, “People may just need more time to understand the designer’s idea.”

Vietnam Airlines pilots and attendants are wearing the new uniforms on select flights from March 3 to March 9 to gauge public opinion before making any final decision.

Thousands of abandoned containers clog Vietnam ports

Thousands of unclaimed containers, many packed with now rotting produce, are stacking up at Vietnam's ports, with the Vietnam Maritime Administration (VMA) now putting the count 5,450 and raising concerns that port facilities were becoming waste dumps.

Hai Phong Port has 5,000 unclaimed containers taking up storage space and posing health risks, followed by Saigon Port with 177 containers, Danang Port with 99 and Quang Ninh with 52.

According to head of the Vietnam Maritime Administration, Nguyen Nhat, most of the abandoned parcels are rubber, used rubber tyres, secondhand electronic goods.

The containers arrived in Vietnam under temporary import/export permits and were supposed to only transit the ports, but were instead abandoned after contents were found to violate re-export regulations.

Nhat said a check of 1,426 containers at Haiphong Port found unauthorized contents. Attempts to trace and force owners to remove the containers had been unsuccessful.

Two containers of tobacco have been at Chua Ve, one of the biggest container facilities in the Haiphong Port system, for nearly ten years.

A representative from Chua Ve containers often leaked in rainy weather and many containing perishable items now stank. Authorities destroyed four containers as potential health hazards.

The VMA said most of the containers were carrying rubber, used tyres, or second hand electronic goods.

Cao Trung Ngoan, deputy general director of Haiphong Port JS Co., said the Ministry of Transport and the People’s Committee of Haiphong have been asked to deal with the containers.

Promoting SOEs’ role in national economy

The Ministry of Planning and Investment and the Office of former UK Prime Minister Tony Blair hosted a seminar on the new role of State-owned enterprises in the national economy and lessons learned for Vietnam.

Participants at the seminar agreed on the important role of SOEs in the economy and the need to reform this sector aiming to promote national competitiveness and international integration.

Minister of Planning and Investment Bui Quang Vinh said,“In the process of SOEs equitization, we need to call for the participation of several shareholders who will change governance to improve efficiency. It will not be effective and could even create gaps in management if only 5 or 10% of SOEs are equitized. The Vietnamese government affirmed that the state sector plays a key role. We will work with the government to determine the role of the state sector and what areas can be 100%, 75%, 65% or less than 50% equitized”.

Tony Blair with his experience as the UK Prime Minister for more than 10 years said that the reform of SOEs was always challenging due to the obstacles and opposition from different groups of interest.

He said that developing role models will be a lesson for Vietnam.

Rice exports face challenges in 2015

Rice exports in the first quarter of 2015 is estimated at 900,000 tonnes, a significant annual decrease, according to the Vietnam Food Association Secretary Huynh Minh Hue.

In previous years the figure for the same period was normally 1.2-1.4 million tonnes, he said, adding that this year setback is attributable to the reduction of foreign orders at the end of 2014.

He also underscored a ripple effect may take place throughout the year, following the drop at the beginning of the year.

China has been one of Vietnam’s traditional markets but is now dividing its demand among a number of rice exporters such as Thailand and Myanmar. China has also been tightening cross-border imports, leading to a number of difficulties for Vietnam.

In 2014, Vietnam lost 60 percent of the African market share, its biggest rice importer, due to price competition from Thailand. This year, as prices dip below those of Thailand, Vietnam has a good chance of market recovery.

Notably, the Ivory Coast and Ghana increased their rice import from Vietnam in January, accounting for more than 31 percent of Vietnam’s total rice shipments abroad in the month.

Dong Nai has 420 firms in support industry

The southern province of Dong Nai currently has 420 enterprises specialising on producing accessories and spare parts for garments & textiles, mechanics and other industries, according to the provincial Department of Industry and Trade.

Of the total, as many as 82 facilities produce materials for garment, textile and footwear production, applying advanced technology and attracting 43,000 workers, reported the department.

However, according to the department, these firms do not meet the demand for material for the apparel and footwear sectors, forcing the sector to import large numbers of materials to ensure production.

Recently, the Vietnam National Textile and Garment Group commenced construction on a 500 billion VND (23.4 million USD) fibre factory in the province. The facility is scheduled to become operational in January 2016, providing nearly 5,000 tonnes of high-quality fibre for garment and textile factories each year.

Meanwhile, 334 enterprises producing mechanical accessories and spare parts including 60 automobile and motorcycle spare parts production facilities. Other firms are working on providing material for plastic and other sectors, it said.

The facilities, with outdated technology and low competitiveness, have failed to meet the demand of their customers, especially in multinational enterprises.-

Nghe An reaches investment deals worth almost 1 bln USD

The central province of Nghe An granted investment licenses to 8 projects and signed 4 deals worth over 967 million USD during an annual New Year meeting in Vinh city on March 4.

Addressing the event, National Assembly Chairman Nguyen Sinh Hung expressed hope that investors would continue their feasible projects and foster innovation to bring new changes in Nghe An.

Secretary of the provincial Party Committee Ho Duc Phoc and Vice Secretary of the Party Committee and Chairman of the provincial People’s Committee Nguyen Xuan Duong called on businesses and investors to develop Nghe An into a hub of finance, commerce, tourism, education-training, science-technology, health care, culture, sport and hi-tech industry in the north central region.

Nghe An commits to improving investment climate and offering the best possible incentives to business players, they vowed.

The event was co-hosted by the provincial People’s Committee, the Party Committee of the Centrally-run Business Bloc and the Bank for Investment and Development of Vietnam.

Last year, Nghe An granted investment licenses to 105 projects worth more than 18.5 trillion VND (880 million USD), representing increases of 45.83 percent in number and 43.74 percent in value against a year earlier. The projects have been put into operation and generated 8,000 jobs.

Some large-scale projects include Hanoi -Kim Liem urban and hotel complex (720 billion VND), Lan Chau-Song Ngu eco-tourism complex (1.97 trillion VND), Thanh Thanh Dat wharf (560 billion VND), Masan Food project (1.2 trillion VND), Ton Hoa Sen (2.3 trillion VND), Nguyen Kim supermarket (550 billion VND) and Vingroup (2.39 trillion VND).

Evolving role of State-owned enterprises spotlighted

The evolving role of State-owned enterprises (SOEs) in the economy and its implications for Vietnam came to the forefront of discussions at a workshop held in Hanoi on March 4.

In order to equitise SOEs and reform their operations, it is necessary to improve business management and quality, said Minister of Planning and Investment Bui Quang Vinh.

Over the past two decades, Vietnam has continuously restructured State-run businesses, which numbered 12,000 in 1990 and have dropped to 5,600 at present.

SOEs possess over 3,000 trillion VND (141 billion USD) worth of assets, including 1,100 trillion VND (51.7 billion USD) of State capital. While constituting only one percent of the total businesses nationwide, SOEs are dominating many important economic sectors. They contribute 85 percent of the electricity and oil and gas output, 90 percent of telecommunication services, and 56 percent of financial-credit services to the economy.

However, the operational efficiency and the role of SOEs in the national economy remain controversial, Vinh said, adding that the proportion of equitised SOEs among big corporations is very low.

Attending the workshop, former British Prime Minister Tony Blair said the question for Vietnam is how to build on its achievements to create more opportunities and prosperity, and reforming SOEs is part of the answer.

He shared that reforming SOEs helped the UK attracted significant foreign direct investment over the past three decades.

Experts from Tony Blair’s office said the Vietnamese Government should clarify whether it pursues equitisation in order to shift to a market economy, improve the SOEs’ operational efficiency and reduce Government debts, or does so because of international pressure.

With a clear goal, the Vietnamese Government can set its priority in privatising SOEs and developing suitable policies to support the efforts.

The former British Prime Minister confirmed that the UK will continue to cooperate with Vietnam and share its experience in the field.

Minister Bui Quang Vinh also stated that the SOEs are a core force of the economy, but their presence should be narrowed in several fields.

He called for foreign recommendations and support to define the evolving role of SOE’s in the new economic context.

Interior design exhibition to be held in HCMC

The Viet Nam International Furniture and Home Accessories Fair will return to HCM city next week, offering industry professionals opportunities to network and compare notes.

VIFA-EXPO 2015, the eighth edition of the event, will feature more than 900 booths of 177 domestic and foreign exhibitors, an increase of 42 per cent and 25 per cent, respectively, over the preceding expo, said Huynh Van Hanh, deputy chairman of the Handicrafts and Wood Industry Association of HCM City (HAWA).

The increase in exhibitors reflects the strong interest of furniture firms for new export opportunities, Hanh said at a press conference held in HCM City yesterday.

The fair will display a wide range of indoor and outdoor furniture, handicrafts, interior furnishing and accessories, machinery and support services.

Seminars to be held at the fair will feature topics on improving the quality of human-resource training in the wood-processing industry, and opportunities and challenges in exporting wood products to the US.

Hanh said 686 customers from 66 countries and territories as of March 3 had registered to visit the fair, which will be held at the Sai Gon Exhibition and Convention Centre in District 7 from March 11 to 14 by the HCM City Department of Industry and Trade and HAWA.

Last year, Viet Nam earned US$6.23 billion from exports of wood and wood products, up 11.5 per cent over the previous year, Hanh said, adding that exports to key markets such as the US, Japan and EU rose strongly in the period.

Investors flock to Ba Ria-Vung Tau

The southern province of Ba Ria-Vung Tau issued licences for nine projects with a total investment of VND2.6 trillion (US$133 million) on Investment Day 2015 last week.

On its website, the province People's Committee said the nine projects include steel plants and businesses in the property, tourism, oil, and agricultural sectors.

Speaking at the event, provincial leaders said it was a good sign in the new year and promised to continue support for business investors.

Province Party Committee Secretary Nguyen Tuan Minh said businesses involving technology and achieving high value-addition would be favoured, meaning the province would give priority to supporting and environment-friendly industries, high-quality tourism and logistics.

As of January this year the province had 303 foreign-invested businesses with a total capital of $27 billion and 430 domestic ones worth VND235 trillion ($11.2 billion).

Last year it had attracted $294 million worth of FDI, a 36 per cent year-on-year increase, and domestic investment of VND8 trillion ($380 million).

Also last year the frequency of meetings between authorities and business executives increased and administrative procedures were improved to resolve difficulties faced by industry.

People's Committee chairman Nguyen Van Trinh promised greater efforts to resolve problems to create a more competitive and better business environment and make Ba Ria-Vung Tau an ideal destination for both local and foreign investors.

Seminar focuses on trade with Japanese province

A seminar to promote trade with Japan's Wakayama province is scheduled to be held in Ha Noi on March 12.

At the workshop, which will be organised by the Viet Nam Chamber of Commerce and Industry (VCCI), representatives from five Japanese businesses operating in the fields of food, agricultural products, T-shaped screw and nut production and the manufacture of dry cleaning machines, will brief participants about their plans to do business in Viet Nam.

The governor of Wakayama, which is famous for several industries, such as agriculture, steel industry and petrochemicals, will speak on the potential and development efforts of the province at the event.

This will be a good opportunity for Vietnamese businesses to meet and exchange information, as well as seek partnership with Japanese enterprises.

Taxi fares show a sharp decline, says ministry

Taxi fares have fallen by 0.92 to 32 per cent, the latest report from the finance ministry has revealed. Transport companies have also reduced their charges by three to 25 per cent.

The ceiling price of economy-class air tickets has fallen by about 15 per cent since the ministry issued a new rule on economy-class fares of domestic flights on December 19, 2014.

The fall in various transport fares and charges are linked to the oil and gas crisis, which has led to a large drop in fuel prices around the world.

Vietnamese furniture on display in Singapore

Eight Vietnamese furniture designs chosen among other winners in the Hoa Mai Furniture Design contest from 2010 to 2013 will be displayed at the International Furniture Fair of Singapore (IFFS) from March 13-16, said Nguyen Quoc Khanh, chairman of the Handicrafts and Wood Industry Association of HCM City (HAWA).

In addition to HAWA representatives and businesses, the young designers of the winning items will participate in the show, Khanh said. They will also take part in the Singapore Design Business Summit 2015, where designers and businesses will present their new projects. Having Vietnamese furniture designs on display at the fair will help promote local furniture design industry, which has proven domestic firms can make products of their own designs instead of producing products following foreign buyers' designs only.

IFFS is one of Asia's premier design-led exhibition shows, featuring a large selection of furniture from diverse exhibitors. The fair last year attracted nearly 22,500 visitors from 115 countries and territories.

Tin Nghia Corp earns big profits from coffee beans

Tin Nghia Corporation exported 117,000 tonnes of coffee beans earning a turnover of $226 million, remaining the second biggest coffee exporter in the country, according to the Dong Nai Province-based company.

The coffee business has made substantial contributions to generating profits for Tin Nghia. The company's revenue reached VND12.043 trillion last year, surpassing the target of 77 per cent. Its profit was VND121 billion.

In the coming time, the company will develop the logistics sector to take advantage of its strategic location in the southern key economic region.

Chinese arrivals fall further in Feb

Chinese tourist arrivals in Vietnam continued dropping in February with 117,560 Chinese visiting the nation, down a staggering 50.7% against the same period last year.

The first two months of the year saw the number of tourists from the largest visitor-generating market for Vietnam declining 40.3% from a year ago, according to the General Statistics Office (GSO).

Many local travel agencies reported falls in Chinese tourists entering Vietnam through border gates in the northern region and by air in the period. However, Chinese visitor arrivals in Danang and Khanh Hoa Province have rebounded after sharp falls in the middle of last year when China illegally placed a giant oil rig in Vietnam’s waters in the East Sea.

There were five scheduled and 15 chartered flights connecting China and Danang City each week before April last year but 13 of them were called off after the East Sea tension broke in May. However, the number of weekly flights has risen to 21 to date.

February also saw a strong year-on-year increase of 68.1% in the number of travelers from South Korea, which is one of the major markets for Vietnam’s tourism sector. But other key markets such as Japan, the United States and Russia encountered slight rises or drops last month.

Some 756,000 foreigners traveled to Vietnam last month, down 10.2% compared to the same period last year. February also marked the ninth consecutive month of decline in international visitors to the country.

Ministry seeks to hike tolls for HCMC-Trung Luong expy

The Ministry of Transport is looking for approval from the Government to increase the tolls for HCMC-Trung Luong Expressway from the middle of this year to have funds for building Tan Tao and Cho Dem interchanges.

The ministry suggested the average toll for vehicles of under 12 seats to go up from VND1,000 to VND1,500 per kilometer from June 1 to December 31, 2018. This will help bring in an additional VND620 billion (US$29.14 million) if the proposal is approved.

The ministry also asked for an additional VND325 billion to be earmarked from the sale of the toll collection right to the HCMC-Trung Luong Expressway to fund the Tan Tao and Cho Dem interchanges projects.

The interchanges are additional components connecting to the expressway, which were approved by the Government in 2009. The ministry okayed the designs of these components in 2010 but the reciprocal capital from the State budget was prioritized for the expressway rather than the interchanges .

According to Cuu Long Corporation for Investment Development and Project Management of Infrastructure (Cuu Long CIPM), building the interchanges is urgent to ease frequent traffic congestion at the Tan Tao-Cho Dem section in rush hours.

When the toll collection for HCMC- Trung Luong Expressway began on February 25, 2012, many 40-feet container trucks switched to the National Highway 1A to avoid a high toll of VND8,000 per kilometer. As a result, traffic congestion and accidents on the highway increased significantly.

In July 2012, Deputy Prime Minister Hoang Trung Hai agreed the ministry’s plan to reduce tolls by 25-30% for trucks of over 18 tons after the government of HCMC and the HCMC Goods Transport Association proposed toll cuts for the expressway.

Currently, tolls applicable to vehicles running on the expressway vary from VND1,000 to VND6,000 per kilometer.

Cars of under 12 seats, trucks of less than two tons and buses are entitled to VND40,000 a single trip on the entire route. However, the charge would rise to VND60,000 if the ministry’s proposal is approved.

The 40-kilometer HCMC-Trung Luong Expressway was opened to traffic in 2010 and vehicles were allowed to move at a maximum speed of 120 kilometers per hour, which was later revised down to100 kilometers per hour.

Son Kim Land, Hamon team up in US$100-million realty project

Son Kim Land has clinched a joint venture agreement with Hong Kong-based investment group Hamon to develop a property project worth more than US$100 million in HCMC.

The two sides will build blocks consisting of 546 luxury apartments for sale and lease on an area of 1.1 hectares in Thao Dien Ward, District 2. The building blocks of the Gateway project will be managed in accordance with five-star standards of Hamon Developments, which is the investor and developer of the upper-class Nguyen Du Park Villas in District 1.

Nguyen Hoang Tuan, chairman of Son Kim Land, said products of the project will be launched on the domestic market this year and are scheduled for completion in the third quarter of 2017.

Tuan however declined to clarify the specific capital contribution of each party in the joint venture, but said the ownership gap is not big.

Gateway is the third property project with the involvement of Hamon Developments under the group in Vietnam after Nguyen Du Park Villas and Hanoi Business Center in the capital city.

Mark K Acree, general manager of Nguyen Du Park Villas, has shown optimism about the recovery of Vietnam’s real estate market this year as the recently loosened conditions for foreigners to buy and own homes in the country would speed up liquidity on the luxury market segment.

Son Kim Land under Son Kim Investment Holding is focusing on project development, mergers and acquisitions (M&A), and property management. Its property portfolio includes Blue Ocean Resort in Phan Thiet City in the central province of Binh Thuan, Sentinel in Hanoi, and Indochine and Empress Tower in HCMC.

In 2013, the investment fund EXS Capital pledged to invest US$80 million in Son Kim Land and this was one of the biggest M&A deals that year.

Hamon, established in 1989, now manages assets worth more than US$1 billion.

Declining BDI major concern for Vinalines

Shipping business at Vietnam National Shipping Lines (Vinalines) generated a positive cash flow last year but falling Baltic Dry Index (BDI) may sink the enterprise into a new period of hardship.

The current BDI hovers around 500 points compared to 700 points at the end of last year, suggesting a hard time for the ship leasing market.

Of the three main fields of dry goods transport, oil transport and logistics, dry goods transport is most affected by fluctuations of the market and this hits hard the shipping operations of Vinalines.

BDI is issued daily by the Baltic Exchange based in London to assess the shipping fees of dry materials like iron ore, coal, cement and grain globally. It directly impacts the ship leasing charges of Vinalines.

As of the end of last year, Vietnam had had 1,840 ships with a combined 7.4 million DWT. The fleet handles almost 100% of domestic goods transport but only 10-12% of imported and exported goods. Vietnamese ships operate mainly on short-haul routes in Southeast Asia, Northeast Asia and the Middle East.

Though the shipping market is in difficulty, shipping lines have strived to find the way out by cutting repair and fuel costs which account for 40-50% of the total operating cost, strictly controlling revenues, seeking to expand markets. As a result, they started to get positive cash flows and are now expecting that BDI will recover soon.

After climbing to 2,300 points in late 2013, the index plunged in the following year to more than 700 points, indicating instability of the market.

However, BDI has been even worse since early this year as it has fallen to 500 points. The index stayed at 516 on Wednesday.

On top of that, the supply of dry goods transport continues rising and has outpaced the demand. The total DWT of the world’s ship fleet picked up 4.3% last year and is estimated to jump in the 2014-2016 period, worsening the supply-demand imbalance.

Since last year, the recovery of the dry goods transport market has been limited due to China’s declining coal imports. The market is forecast to grow slowly this year while there are more new ships.

Investor of PVN Tower to be replaced

The Prime Minister has approved in principle on replacing the investor of the commercial and recreational complex of Vietnam National Oil and Gas Group (PetroVietnam), also known as PVN Tower, in Hanoi’s Nam Tu Liem District.

The government of Hanoi City has been assigned to consider and decide on a proposal of Mai Linh Investment Co. to replace the current investor to ensure the effectiveness of land use.

In 2012, the PM told PetroVietnam not to develop the complex consisting of a five-star hotel, commercial center and park on an area of 21.2 hectares to focus resources on its core businesses. Therefore, PetroVietnam gradually withdrew capital from the property sector.

As instructed by the PM, the project was transferred to PetroVietnam Construction Corporation and PetroVietnam only contributed a small amount of capital to building office space for the group and the group’s name would not be attached to the project.

In March 2011, the project was scaled down from 102 floors to 79 floors and the investment was cut from US$1 billion to US$600 million. The adjustment plan of PVN Tower was announced after the National Assembly (NA) discussed re-investing VND3.5 trillion in PetroVietnam. At that time, a number of NA deputies voiced their concerns that the VND3.5 trillion for PetroVietnam was unreasonable at a time when public spending was being tightened.

The project was scheduled to get off the ground in 2011 and be finished in 2014. However, this huge project has yet to be built.

Therefore, Mai Linh Investment Co., which is known for Golden Palace, the commercial center and urban area under construction in Hanoi, may replace the old investor to develop the project.

Ba Ria-Vung Tau attractive to investments

The southern province of Ba Ria-Vung Tau continued to be a magnet for investors last year.

At a Lunar New Year meeting with investors in the province last Friday, local authorities announced that as of December 2014, Ba Ria-Vung Tau was home to 290 foreign direct investment (FDI) projects capitalised at $26.7 billion, making it one of the top localities nationwide in terms of FDI attraction.

 In 2014, three new FDI projects obtained investment certificates, including the $34-million Lotte Vung Tau commercial centre, the $27-million fertiliser production plant of Germany’s Behn Meyer Agricare Vietnam Co. Ltd., and the Spain-funded pilot solar power project in Con Dao island district worth $15 million.

Meanwhile, six FDI projects were approved to increase investment capital by nearly $220 million, with Thi Vai International Port accounting for $77 million and Posco SS-Vina steel plant  contributed $84 million.

Foreign investors disbursed $1 billion to implement their projects in Ba Ria-Vung Tau last year, according to Nguyen Van Trinh, Chairman of the provincial People’s Committee.

He attributed the province’s FDI attraction success to local tax incentives and improved administrative  procedures, particularly the operation of a ‘one-stop-shop’ mechanism.

Yoshihiro Hatano, general director of Vietnam Rare Elements Chemical JSC said Ba Ria-Vung Tau claimed a special geographical location and functioned as a gateway to other Southeastern provinces. In addition, it benefits from its proximity to the international Cai Mep sea port, which connects the province to other countries.

Vietnam Rare Elements Chemical JSC is the first rare earth production project in Vietnam with a total capital of $49 million. The company has recently inaugurated the first phase of the zircon plant at Cai Mep Industrial Zone, using Japanese advanced technology to process zircon ore to produce metasilicate and zirconium compounds  with a capacity of 13,300 tonnes of zirconium oxychloride and 8,500 tonnes of sodium metasilicate a year.

The Ho Chi Minh City-Long Thanh-Dau Giay expressway, which came into operation last month, will drastically cut down the travel time between Ba Ria-Vung Tau and other neighbouring provinces. “It also boasts marine, thermal power, as well as oil and gas industries, promoting it as an ideal destination for investors,” Trinh added.

He spoke highly of domestic and foreign invested businesses’ efforts to overcome difficulties and boost investment, production and sales, thus significantly contributing to the successful completion of the province’s economic development objectives.

“Despite economic difficulties in 2014, the majority of economic sectors in Ba Ria-Vung Tau continue to grow steadily compared with 2013,” he said.

Roughly 7,000 domestic firms are operating in Ba Ria-Vung Tau. Last year they disbursed VND8.5 trillion  (nearly $400 million) for business and production development.

In 2014,the province issued investment certificates for 24 new domestic projects worth over VND8 trillion ($376 million).

Trinh said businesses played a pivotal role in the province’s social development. Many firms and investors have donated to support the Fund for the poor, the Fund for Agent Orange Victims, the Study Promotion Fund, and the Social Security programme.

According to Trinh, Ba Ria-Vung Tau will keep addressing arising issues to improve the investment climate, especially in terms of administrative procedures. In 2015, the local authority will create even more favorable conditions to attract both domestic and international firms to the province.

VBSP offloads G-bonds worth $35.28 million

The Vietnam Bank for Social Policies (VBSP) offloaded more than half of the VND1.5 trillion (US$70.4 million) government bonds that it offered on March 2, said the Hanoi Stock Exchange (HNX).

The Vietnam Bank for Social Policies offloads on (US$70.4 million) government bonds that it offered on March 2, said the Hanoi Stock Exchange (HNX).Photo vietbao.vn

After the auction, the bank offloaded bonds worth VND751.6 billion ($35.28 million), added HNX.

Among the bonds put on sale, all three-year bonds worth VND400 billion ($18.77 million) were sold at a coupon rate of five per cent per year.

Meanwhile, five-year bonds worth VND100 billion ($4.69 million), or one-fifth of the bonds, were sold at the coupon rate of 5.65 per cent per year, while ten-year bonds worth VND100 billion ($4.69 million) - one-third of the bonds - were sold at 6.79 per cent per year. About half of the 15-year bonds, worth VND151.6 billion ($7.1 million), were sold at 7.69 per cent per year.According to HNX, the bank has sold government bonds worth VND3.953 trillion ($185.5 million) over five auctions since the beginning of 2015.

HNX added that during the same period, the State Treasury of Viet Nam mobilised VND40.37 trillion ($1.895 billion) in G-bonds via six auctions at the exchange.

Real estate players pump cash in as confidence rises

Established real estate players and relative new-comers alike have expressed growing confidence over residential sales in the early part of this year, using the opportunity to increase investment.

CEO Group chairman Doan Van Binh said his firm was quickly preparing for a busy year ahead following the firm’s floatation on the stock market which saw it increase its legal capital investment to double last year. Binh plans to invest VND1-1.5 trillion ($47.6-71.4 million) in 2015.

However, even this figure is dwarfed by conglomerates such as Vingroup, Bitexco, Phu My Hung or Novaland.

CEO Group’s optimism is based on the positive changes anticipated by the application of the laws on Real Estate Business and Housing which were passed by the National Assembly at the end of last year.

“I know those revised laws won’t have an immediate impact but they should help increase confidence,” Binh said.

Vietnam’s largest real estate developer, Vingroup, has begun construction on its $1.42 billion Vinhomes Central Park project in Ho Chi Minh City. This project will supply more than 10,000 apartments to the market. The group is also implementing its Vinhomes Nguyen Chi Thanh development in Hanoi with 378 units and has bought out Hong Ngan Real Estate JSC to expand its portfolio in Hanoi.

FLC Group, following a round of acquisitions, is now implementing FLC Complex with 500 units, FLC Garden City in Hanoi and a golf course and resort in Thanh Hoa province.

Meanwhile, after successfully developing industrial zones in Hanoi and Hai Duong province, VID Group has finished an office building for lease in Hanoi and starting its Goldmark City residential area in Hanoi. It has also received the go-ahead to transform the existing Dai Tu Industrial Zone into a residential area.

In Ho Chi Minh City, newcomer Dai Quang Minh Real Estate JSC has also implementing its large scale project in Thu Thiem.

Backed by experienced stock holders, Dai Quang Minh is implementing low-rise residential areas and infrastructure in the Thu Thiem New Urban project, providing more than 230 villas and 5,600 apartments.

However, Peter Ryder, general director of Indochina Land said that some segments such as retail and offices were still facing big challenges while the residential segment had seen an upward trend but competition had been tough and many projects still had substantial numbers of unsold units.

As an experienced real estate developer in Vietnam, Indochina Land will launch its high-end apartment project in Hanoi this year.

Thai Nguyen to become center of Northern Midlands and Mountainous

Thai Nguyen will become an industrial province and the center of the Northern Midlands and Mountainous area in terms of industry, services, education and training, according to the province’s socio-economic development overall plan by 2020, with a vision towards 2030.

By 2020, the province will possess a modern economic structure with sustainable economic growth rate and high competitive products as well as synchronous infrastructure system. Besides, the province will launch green growth, reduce carbon emissions and become a crucial area to firmly protect the regional national defense and security.

The economic growth rate of the province is expected to reach 10-11% per year till 2020.

The province sets to reduce poor households by 1.8-2% and create 20,000-22,000 jobs per year. It also targets to decrease urban unemployment to 3.7%.

By 2030, Thai Nguyen City will be developed as an ecological city, tasked to focus on State management, training, specialized health care, science-technology, services, finance, banking and commerce.

UK investors seek opportunities in Vietnam

Crowds of UK investors gathered at a workshop organised by the UK-ASEAN Business Council (UKABC) on March 3 in London to examine investment opportunities in the Vietnamese market.

The event forms part of activities for the Vietnam-UK Joint Economic and Trade Commission (JETCO)’s eighth session held in the city on March 2.

During the event, Vietnamese Deputy Minister of Industry and Trade Ho Thi Kim Thoa highlighted Vietnam’s investment potential, saying that the country is undertaking efforts to restructure its economy and improve its legal system and business climate to facilitate foreign investment.

She affirmed that Vietnam is a responsible partner and has joined numerous bilateral and multilateral agreements to that effect.

Thoa expressed her hope that the forum will present opportunities for UK investors to enter Vietnam, contributing to bringing the two nations’ trade ties to new heights.

Lord David Terence Puttnam, the UK Prime Minister's Trade Envoy to Vietnam, Cambodia, Laos, and Myanmar, stressed the need for local firms to actively build mutual trust with Vietnamese partners to create opportunities in the potential market.

The UK is now one of Vietnam’s leading economic partners in the European Union, ranking 16 th out of 101 nations and territories investing in the country.-

Vietnam participates in Foodex Japan 2015

Seventeen Vietnamese businesses processing and exporting agriculture and aquaculture products are participating in the 40th International Food and Beverage Exhibition in Japan (Foodex Japan 2015), which opened on March 3.

Their products, including rice, fruits, fish sauce, cakes and beverages, are displayed across 126 square metres at the Makuhari Messe International Convention Complex in Chiba Prefecture.

Vietnamese Ambassador to Japan Doan Xuan Hung hailed the preparation of Vietnamese enterprises for the occasion, saying that many Japanese investors showed interests in the featured products.

Foodex Japan is the largest international food and beverages exhibition in the Asia-Pacific region. It represents a valuable opportunity for Vietnamese businesses in the sector to seek partners in Japan and expand their operation.

Deputy Director of the Vietnam Trade Promotion Centre for Agriculture under the Ministry of Agriculture and Rural Development Hoang Van Du stressed the need for Vietnamese businesses to fulfil international product quality standards to tap strict markets like Japan.

This year, the three-day fair is expected to draw the participation of more than 2,800 businesses from 78 countries and territories and 80,000 visitors.

Business opportunities introduced at London seminar

Vietnam is a reliable partner which has joined many bilateral and multilateral agreements and a potential destination for foreign investors, said Deputy Minister of Industry and Trade (MoIT) Ho Thi Kim Thoa.

At a seminar held in London on March 3 by the UK-ASEAN Business Council (UKABC), Ms Thoa introduced investment and business opportunities in Vietnam, emphasising that the country has actively restructured and completed the legal system and improved the investment environment to facilitate and create an equal and transparent environment for investors.

She hoped that the seminar will provide businesses with update information about cooperation, investment and business opportunities in Vietnam, and help lift trade relations between the two countries to a new height in line with their potential.

Lord Puttman, the UK Prime Minister’s Trade Envoy to Myanmar, Cambodia, Laos and Vietnam, said UK businesses should be patient to set up relations and build up trust with Vietnamese partners in order to promote business opportunities in the dynamic market.

Speakers at the seminar, including Ms Thoa, Mr. Dang Hoang Hai, Head of the European Market Department under the MoIT, and UK Consul General and Director of Trade and Investment in HCM City, Douglas Barnes, answered participants’ questions on granting construction licences to foreign investors to Vietnam, policies allowing foreigners to buy houses, opportunities to invest in transport and healthcare projects and chances for UK small-sized businesses to operate in Vietnam.

The seminar was held on the sidelines of the 8th session of the Vietnam-UK Joint Economic and Trade Commission (JETCO 8).  

SMEs urged to focus more on low-income consumers

New companies, small- and medium-sized enterprises (SMEs) with limited investments, are advised to attend more to low-income people as they make up a majority of consumers.

Curtis Peterson of the Pears Program for Global Innovation at Tel Aviv University in Israel gave the advice at a seminar held by the 2030 Businessmen Club under the Saigon Times Club in HCMC on March 2 to discuss startups, markets and product marketing among low-income consumers.

Peterson, the main speaker at the seminar, presented the Base of the Pyramid (BOP) model showing that 4.9 billion out of 7.3 billion people on earth earn less than US$2.5 a day.

In Vietnam, low-income earners account for a majority of the population. Therefore, this is a promising market segment for business startups in agriculture and related sectors.

According to the General Statistics Office (GSO), the average monthly income in urban areas stayed at VND3 million (US$140.5) while that in rural areas is just VND1.6 million in 2012.

Local businesses pointed out selling prices as among their major concerns when producing and supplying goods and services in rural areas.

Nguyen Khac Minh Tri, director of Mimosatek Company, said it is difficult for his company to set a price for a mineral measurement device for crops and fisheries which farmers can afford to pay.

Peterson suggested Mimosatek to offer farmers with various product packages that suit their budgets. He also advised SMEs to be creative and improve products frequently to meet the needs of low-income consumers.

Figures of the Vietnam Medium and Small Business Association, there are about 500,000 SMEs in Vietnam with combined capital of US$121 billion, accounting for 97.5% of the companies operating in the country.