Lam Dong subsidises coffee production cost for needy farmers

Disadvantaged households in the Central Highlands province of Lam Dong will have up to 80 percent of their coffee strain cost covered by the local People’s Committee.

The supported families all live below the poverty line or members of the ethnic groups spread across ten localities, including the cities of Da Lat and Bao Loc, and the districts of Lac Duong and Don Duong.

The agricultural subsidies they will receive amount to 10.3 billion VND (480,000 USD).

More than 1.5 billion VND (69,904 USD) of the sum will come to Lac Duong, where coffee plantations suffered serious frost damage recently. The money will cover 100 percent of the cost to plant over 118 hectares.

Northwestern localities seek deals at Lai Chau fair

The Northwestern Region Industry-Trade Fair 2015, launched in the mountainous city of Lai Chau on May 5, is offering broader, productive connection for regional producers and distributors.

More than 200 stalls feature garments, handicrafts, agro-products, machines, home decorations, and electronics, exposing participating businesses’ strengths and potential.

According to Deputy Chairman of the provincial People’s Committee Nguyen Chuong, the fair promotes links between businesses in the region and helps them find partners.

Consumers can access high quality products and services via the event, he added.

The fair, part of a programme to promote the industry developed by the Ministry of Industry and Trade and the province of Lai Chau, will run until May 11.

The northwestern region consists 12 mountainous and midland localities of Yen Bai, Lao Cai, Dien Bien, Lai Chau, Son La, Phu Tho, Ha Giang, Tuyen Quang, Bac Kan, Hoa Binh, Lang Son and Cao Bang, as well as western districts of Thanh Hoa and Nghe An provinces.

The region, having a long border with Laos and China, also plays an important role in national security-defence and foreign relations.

The region’s GDP growth rate averaged around 9.5 percent and per capita GDP reached 24.7 million VND (1,160 USD) over the last five years.

It is now focused on calling for investments in mineral exploitation, forest product processing, border gate economic activities, and tourism.

Bac Lieu calls for investment in 15 projects

The Mekong Delta province of Bac Lieu has listed 15 key projects in five sectors requiring investment in 2015.

Of the projects, three involve developing residential and urban areas; two are related to culture and tourism development; six deal with infrastructure; two are in the health sector; and two will boost agricultural services.

Some notable projects are the Ganh Hao port, with an estimated investment of 600 billion VND (27.7 million USD); the industrial Lang Tram zone, 670 billion VND (30.9 million USD); and another hi-tech agricultural production park, 1,362 billion VND (62.9 million USD).

Nguyen Quoc Nam, deputy director of the province’s tourism and trade investment promotion centre, said Bac Lieu has been worked to create a good investment environment. It has issued many incentivised policies on finance, tax exemption, income tax and labour training to assist enterprises.

In the first quarter of the year, the construction of an eel processing factory managed by a Republic of Korean investor, and a factory run by the Vietnam Garment and Textile Corporation started in the province.

The province expects to reel foreign investment into hi-technology agriculture, aquaculture breeding and healthcare this year.

Retail petrol prices go up by nearly 2,000 VND per litre

The domestic retail prices of oil and petroleum went up at 9pm of May 5 in the wake of increasing global fuel prices.

Following a joint decision issued by the Ministries of Industry and Trade and Finance, petrol and oil retailers have increased the price of RON 92 by nearly 2,000 VND to 19,200 VND (0.89 USD) per litre.

While the prices of diesel and mazut remain unchanged, kerosene has become cheaper by 258 VND per litre.-

Local firms have yet to update knowledge of FTAs

Many local enterprises do not know much about the Trans-Pacific Partnership (TPP) and the AEC free trade agreements (FTAs) that are expected to be signed this year.

Adequate knowledge about these FTAs would help domestic firms in Vietnam prepare for business integration at a global and regional scale.

The Vietnam Chamber of Industry and Commerce (VCCI)'s survey for the provincial competitiveness index (PCI) 2015 reported that 30 percent of the interviewees among enterprises in Vietnam did not have enough information about Vietnam having negotiated to join the TPP agreement.

Of these, 31.5 percent were private enterprises and 29.8 percent were foreign-invested enterprises, said Dau Anh Tuan, the head of VCCI's legal department.

The survey also said domestic enterprises in Vietnam expected the State to support enterprises in drawing advantages from the TPP and solving difficulties after joining the TPP and the ASEAN Economic Community (AEC), he said.

Tuan said enterprises did not have much information about the TPP and AEC so they needed guidance to prepare well for the impact stemming from the FTAs.

The AEC is expected to be formed this year, but 76 percent of Vietnam's enterprises have no information about the AEC, 94 percent of them had no knowledge of the AEC negotiation rounds and 63 percent said they did not know anything about the business opportunities or the challenges stemming from Vietnam joining the AEC, another survey said.

To Hoai Nam, Vice Chairman and General Director of the Vietnam's Small and Medium- sized Enterprises said Vietnam's enterprises were aware of the competitive abilities of large international enterprises, but they did not possess any knowledge about the competitive abilities of firms in the ASEAN region so they had not developed clear solutions to compete with these rivals.

Meanwhile, Nam said, about 10,000 enterprises from ASEAN, such as Singapore and Thailand, had already visited Vietnam this year for conducting market studies.

These regional enterprises had actively sought market information and a chance for entering Vietnam's market, which was considered a potential market, and they would not wait until the AEC was officially established at the end of this year, he said.

Tran Dinh Thien, Director of the Vietnam Economic Research Institute, was concerned that Vietnam had negotiated to sign several FTAs, but the local enterprises had low competitive abilities, poor national management ability and low labour productivity, compared with other enterprises in the region and the world.-

Vietnam exports to Australia expected to surge in 2015

Vietnam’s exports to Australia are predicted to surge in 2015 due to the latter’s decision to import prominent commodities from the Southeast Asian nation.

The Australian Ministry of Agriculture approved litchi imports from Vietnam earlier this month and as a result, a number of Australian authorities are preparing to visit Vietnam to examine and agree on quality standards for the fruit.

In 2014, Vietnam’s farm produce and seafood grew by 17.5 percent annually among goods destined for Australia, making it the highest growing commodity.

Pepper saw a yearly increase of 52.5 percent while aquatic products recorded a rise of 20.7 percent to exceed the targeted 200 million USD.

Cashews witnessed a slight rise of 12.6 percent to dominate the Australian market with 96 percent of the market share.

Furthermore, processing and manufacturing industrial products also saw a 13.9 percent rise against the previous year.

Other commodities with high growth were iron and steel (121 percent); electric wire (80.4 percent); cement (255 percent); means of transport and spare parts (66.5 percent); garments and textiles (46.7 percent); footwear (30.6 percent); and wood and timber products (22.6 percent).

Currently, Australia is the eighth biggest importer of Vietnamese products. In 2014, trade hit 6 billion USD, an annual rise of 18.8 percent, raking in 3.99 billion USD in exports and running a trade surplus of 1.93 billion USD.

According to the Vietnam General Department of Customs, export turnover to Australia reached 742.8 million USD in the first quarter of 2015. Seafood, in particular, made up 59 percent of Vietnam ’s total export revenue.

However Australia is a highly selective market with strict quality and quarantine regulations. Businesses should pay careful attention to ensuring quality before abroad.

The Vietnam Trade Office in Australia advised businesses to declare cargo status to the Australian Quarantine and Inspection Service (AQIS) immediately after harbouring at the foreign market.

Simultaneously, firms must ensure safety and quality standards to save accrued expenses.

Import demand from Australia is high; each year, the country spends around 80 billion USD on imports.

Import tariffs on oil products slashed again

Vietnam continued reducing import taxes on oil products, beginning April 4, according to the Ministry of Finance.

Under the ministry' latest circular, issued on April 27, import tariffs on diesel and fuel oil dropped by 8 and 12% o 12 and 13%, respectively.

Meanwhile, import taxes levied on other products, including petroleum, kerosene and jet fuel, were kept unchanged at 20% for petroleum and kerosene, and 10% for jet fuel.

This is the second time this year that Vietnam cut import tariffs on oil products.

Meanwhile, a representative from the Finance Ministry said the adjustment of import tariffs was aimed at preventing an increase in domestic oil prices when the country tripled the environmental protection fees on petroleum products beginning in May this year.

Under the new regulation, the environmental protection fee will be raised to VND3,000 from VND1,000 for petroleum and jet fuel, respectively, and to VND900 to 1,500 per litre for diesel and fuel oil, respectively.

The reduction was made as part of Vietnam's roadmap to cut preferential import taxes on oil and petroleum products, which is in line with the country's commitment to the ASEAN Trade in Goods Agreement (ATIGA), the ASEAN-China Free Trade Area (ACFTA) and ASEAN-Republic of Korea Free Trade Agreement (AKFTA).

Domestic credit growth climbs to three-year high

Vietnam's credit growth rate reached 2.78% in the first four months this year – the highest in three years, according to the National Finance Supervision Council (NFSC).

The NFSC noted that the loan-to-deposit ratio in February was 84%.

It added that the country's economy has experienced a clear recovery with macroeconomic stability that has encouraged rapid and sustainable growth.

The latest report issued by the NFSC on May 4 showed that the total demand saw many positive changes, with the total investments in the first quarter of the year rising 9.1% over the same period last year.

By April 20, this year's credit growth reached 2.78%, much higher than the 0.53% increase during the corresponding period last year. The FDI disbursement during the first four months of the year reached US$4.2 billion, posting a 5% year-on-year rise, while investments from the state budget rose 2.4% from last year.

In addition, consumption also improved. The total retail of goods and services, excluding a price rise during the four-month period, rose by 8% over the same period last year.

The industrial and construction sectors also made a strong recovery, contributing to the high growth rate.

The Index of Industrial Production posted a 9.4% year-on-year increase. In this, the processing and manufacturing industry grew by 10% from 2014.

The construction sector and property trading activities also improved, with their growth rates in the first quarter of the year reaching 4.4% and 2.55%, respectively.

Average revenue, assets, and equity enterprises posted a growth rate of 19.61%, 19.51%, and 18.9%, respectively.

Business sentiments among Vietnamese firms have also recovered despite many obstacles.

Small and medium enterprises regained a positive growth rate of 28.31%, the highest since 2009.

Gov't to impose import tax on PSF

Import tax on polyester staple fibre (PSF) might be increased from zero to 2%, as the Ministry of Industry and Trade has proposed to encourage domestic production.

Aiming to rescue domestic fibre manufacturers facing harsh competition from imported fibre, the Ministry plans to raise tax on staple fibre, coded 55.01, 55.02, 55.03, 55.04, 55.06 and 55.07, which are currently enjoying a zero tax rate.

According to the Ministry of Industry and Trade, Vietnam imports around 150,000 tonnes of polyester fibre every year, while domestic producers do not run at full capacity.

One of the leading producers, PetroVietnam Petrochemical and Textile Fiber Joint Stock Company (PVTEX), runs only 50 per cent of its design capacity due to difficulties in selling owing to competition from imported products.

With plunging oil prices, the global price of the PSF has dropped sharply, forcing the PVTEX to lower the price of its fibre from US$1,340 per tonne in August 2014 to US$970. However, this has not improved its chance against importers. The current price cannot make up for production costs.

According to the ministry, it is important to encourage the use of domestic fibre to enhance the competitiveness of Vietnam's garment and textile industry, given that the country has been carrying out negotiations to join the Trans-Pacific Partnership, which requires a yarn-forward rule of origin for textiles and apparel.

Toyota seeking more incentives in Vietnam

Toyota has proposed a series of tax breaks for locally assembled cars so that the Japanese automaker can increase the localization rate and open new factories in Vietnam.

Local media cited a letter Toyota has sent to Vietnamese authorities as saying that tax reductions are among many policy recommendations the carmaker put forward based on its production forecast.

These recommendations were submitted with a view to maintaining Toyota’s production in Vietnam for the long-term development of the Vietnamese automobile industry after 2018, news websites VietnamNet and VnExpress quoted the document as saying.

The Japanese firm proposed changing the calculation of the excise tax on completely knocked down (CKD) cars from selling to factory prices, which Thailand and Indonesia are applying, according to the document submitted in a meeting between senior officials from the Vietnamese Ministry of Industry and Trade and the Japanese Ministry of Economy, Trade and Industry.

CKD cars are vehicles that are assembled locally with all of the major parts, components, and technology imported from the country of their origin.

Toyota also suggested reducing import duties on CKD car components imported from Japan from the current rate of 15%-25% following World Trade Organization commitments to 0%, which is equal to the tax rate for those shipped from ASEAN starting in 2018.

ASEAN stands for Association of Southeast Asian Nations, including Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei, Cambodia, Laos, Myanmar, and Vietnam.

A special consumption tax on vehicles produced domestically will follow two scenarios, as proposed by Toyota, a 20% discount on the price of which the excise special consumption tax is based on, or a reduction from 45% to 35%.

Moreover, Toyota also wants a corporate income tax reduction for automobile manufacturing enterprises, which are currently mostly foreign-invested firms, including the Japanese carmaker.

The most noticeable suggestion is a request for government subsidies in the form of financial support for locally assembled vehicles equivalent to 50% of the price difference between imported cars, or completely built units (CBUs), and CKD cars.

According to calculations by Toyota, CKD cars will be around 20%-25% more expensive than CBUs in 2018 when import tariffs for cars made within ASEAN are to be fully exempted.

The ASEAN bloc aims to establish an EU-style economic community by the end of this year, with tax exemptions for many goods and commodities circulated among the members.

Toyota recommended that government subsidies should be worth around 10%-12.5% of the price difference between CKD cars and CBUs.

The Japanese firm suggested that the financial and tax support last for ten consecutive years, pointing out two scenarios that will occur if the government of Vietnam chooses to support the plan, or not.

If the government approves the proposal, Toyota Vietnam will strive to gradually enhance local content to cut costs and eventually eliminate the 50% in cost differences between CBU and CKD cars, the letter said.

As estimated by Toyota, the localization ratio in 2020-2025 will be higher than the current figure of 20%-37%.

With the current five models, Toyota will add 2-3 new models by that time. Estimated annual production capacity will be raised from 40,000 vehicles to 50,000 vehicles.

Toyota will consider a new factory with a capacity of up to 100,000 vehicles per year after 2025.

If there is no support from the government after 2018 as proposed, it will be difficult to maintain vehicle production in Vietnam, as by then Toyota’s rivals will have sold imported vehicles cheaper than domestically produced vehicles in mass volume, the automaker said in the document.

In 2020, Toyota Vietnam will reduce annual production capacity from the current 40,000 units to just 13,000 units, and the localization rate will not increase, according to the document.

By 2025, all operations will be completely halted and it would gradually stop producing vehicles domestically and cease investing in Vietnam as locally assembled cars will be more expensive than imported cars, the document said.

Toyota's proposal comes in the context of Vietnam being under pressure to partially cut and completely lift the tariff barriers against cars imported from other countries in the ASEAN region from now to 2018.

Toyota entered Vietnam in 1995, with its existing investment reaching about US$90 million.

Besides the main activity of assembling CKD cars, Toyota also has the right to import CBUs following Vietnam’s commitments when it joined the World Trade Organization in 2007.

SHB awarded “Best Customer Service Bank” in Vietnam

Saigon-Hanoi Commercial Joint Stock Bank (SHB) has been awarded “Best SME Bank” and “Best Customer Service Bank” in Vietnam for 2015 by UK’s prestigious, online magazine, Global Banking and Finance Review.

For the “Best SME Bank” award, SHB proves effective policies of lending, commitments, priorities, initiatives and solutions in order to support small-and-medium sized enterprises (SMEs).

The bank also demonstrate strength in providing and managing excellent customer service, average transaction time, staff behavior/attitude and was named as the  “Best Customer Service Bank”.

SMEs are one of the bank’s targeted customer segments.

Recently, the bank has provided credit programmes with lending interest rates discounted for SMEs and households in agriculture, rural development and exports (with total limit up to VND15 trillion), and middle-and long-term loans for SMEs.

In 2015, the bank aims to achieve gross profits of VND1,120 billion. Last year’s total revenue was VND1,012 billion.

Hanoi simplifies tax payment process

Hanoi is set to simplify at least 20% of its tax payment procedures, effectively cutting 45.5 hours of tax filing and payment this year per entity.

More than 107,600 firms in the capital city have conducted e-tax declarations, or 96.5% of the total, said Director of the Hanoi Taxation Department Ha Minh Hai.

Dozens of tax payment training courses have been launched since the outset of this year.

From March 2 – April 4, the department answered more than 4,200 questions raised by over 3,600 taxpayers in the capital.

To make it more convenient, the department also opened 300 tax collection sites in collaboration with the State Treasury and commercial banks.

Chinese businesses keen on investing in Binh Duong

China has invested nearly US$1.4 billion in 204 projects in southern Binh Duong province, said Tran Thanh Liem, Vice Chairman of the provincial People’s Committee.

At a May 4 meeting with an 18-member  business delegation from Chinese Fujian province, Liem said Binh Duong leads provinces and cities nationwide in terms of foreign direct investment (FDI) garnering with 2,460 projects which are valued at nearly US$21 billion.

He added that the province always creates a niche for investors to operate effectively.

Binh Duong encourages and gives priority to investment projects in industrial zones which have modern technologies, highly competitive products and less pollution.

To take advantages brought about by free trade agreements, especially the Trans-Pacific Partnership (TPP), the province has planned special zones for the garment support industry in Bau Bang district and Ben Cai town and for the timber support industry in Bac Tan Uyen IZ.

The Fujian businesses’ visit to Binh Duong this time aims to seek investment opportunity, especially in garment and footwear industries and to gain a better understanding about tax and land preferential policies.

Late March, a Chinese business association in HCM City led by its President Miao Ren Lai held a working session with Binh Duong leaders to study investment environment.

Vietnam Medi-Pharm exhibition to open in Hanoi

As many as 350 enterprises and organisations around the world will showcase their products at the 22nd Vietnam International Hospital, Medical and Pharmaceutical Exhibition held in Hanoi from May 13-16.

On the display across 450 booths are latest pharmaceutical products, medical equipment, diagnostic equipment, laboratory items and healthcare services.

The annual event creates a platform for enterprises to exchange experience, seek partnerships and sign contracts.

During the exhibition, there will be a forum calling for support to disadvantaged patients, a conference on protecting pharmaceutical trademarks and a programme to stimulate the consumption of medical equipment and beauty products.

Last year, the event welcomed more than 200 exhibitors from 20 countries and regions exhibiting medical and laboratory products, packaging machinery and ophthalmological and dental products.

The 8th Vietnam International Exhibition on Hospital and Equipment (Vietnam Hospital 2015) and the 4th Vietnam International Exhibition on Dental Materials and Equipment (Vietnam Dental 2015) will also take place within the framework of the primary event.

Kien Giang to build passenger ships

The Mekong Delta province of Kien Giang has decided to invest 80 billion VND (3.72 million USD) in building new ships, including the Tho Chau 09 - Phu Quoc and a passenger ship for the route from Ha Tien to Tien Hai commune.

The 36m-long, 6m-wide Tho Chau 09 - Phu Quoc ship will be able to carry 25 tonnes, and transport 10 tonnes of goods and 130 passengers at speeds of up to 25 sea miles per hour. It will be built between 2015 and 2016 with a total investment of around 56.5 billion VND (2.62 million USD).

The passenger ship for the route from Ha Tien to Tien Hai Commune will also be built between 2015 and 2016, with an investment of 24 billion VND (1.11 million USD).

The 27m-long, 4.9m-wide vessel will be able to carry 11 tonnes and transport 90 passengers, also at speeds of up to 23-25 sea miles per hour.

Northwestern localities seek deals at Lai Chau fair

The Northwestern Region Industry-Trade Fair 2015, launched in the mountainous city of Lai Chau on May 5, is offering broader, productive connection for regional producers and distributors.

More than 200 stalls feature garments, handicrafts, agro-products, machines, home decorations, and electronics, exposing participating businesses’ strengths and potential.

According to Deputy Chairman of the provincial People’s Committee Nguyen Chuong, the fair promotes links between businesses in the region and helps them find partners.

Consumers can access high quality products and services via the event, he added.

The fair, part of a programme to promote the industry developed by the Ministry of Industry and Trade and the province of Lai Chau, will run until May 11.

The northwestern region consists 12 mountainous and midland localities of Yen Bai, Lao Cai, Dien Bien, Lai Chau, Son La, Phu Tho, Ha Giang, Tuyen Quang, Bac Kan, Hoa Binh, Lang Son and Cao Bang, as well as western districts of Thanh Hoa and Nghe An provinces.

The region, having a long border with Laos and China, also plays an important role in national security-defence and foreign relations.

The region’s GDP growth rate averaged around 9.5 percent and per capita GDP reached 24.7 million VND (1,160 USD) over the last five years.

It is now focused on calling for investments in mineral exploitation, forest product processing, border gate economic activities, and tourism.

Hanoi targets 5 bln USD earnings from IT in 2015

Hanoi has set a target to earn 5 billion USD from the information and technology (IT) industry this year, with incentives being provided to encourage investments in the sector.

The turnover from hardware was expected to reach 3 billion USD, 80 percent of which would come from exports and the annual growth rates for software and the content sectors would reach 15 percent.

Experts have pointed out that to develop the IT industry, the capital city must formulate detailed incentive policies to encourage investments and develop concentrated IT areas, even as the State budget for the IT industry remains modest.

Although the IT industry contributed largely to Hanoi's gross domestic product, the capital city fell behind other major cities, including Da Nang, Ho Chi Minh City and Bac Ninh province in the rankings for IT development. In 2014, Hanoi was ranked fifth out of 63 provinces and cities by the Vietnam ICT Index.

At a recent meeting of the municipal Department of Information and Communications with IT firms, Nguyen Long, President of the Vietnam Association for Information Processing, said the progress for building concentrated IT areas was slow in Hanoi in comparison with HCM City and Da Nang.

The municipal Department of Information and Communications report said the implementation of key IT park projects was slow, adding that the city lacked the factors that could result in a breakthrough for the development of the IT industry.

The report also revealed that foreign direct investment into the IT industry in the city was low in comparison with other localities, such as Bac Ninh and Thai Nguyen provinces, HCM City and Hai Phong City, which had attracted investments from technology giants, such as Samsung, Intel and LG.

"Incentives would be transparent for both foreign and domestic investors," Long said.

To achieve the target, Hanoi would enhance the State management together with raising incentives to encourage investments for developing the IT industry. Besides, the construction of IT parks would be hastened.

At the meeting, the Deputy Chairman of the municipal People's Committee, Le Hoang Son, said the Department of Information and Communications must listen to firms to solve the difficulties that they were facing while formulating appropriate policies.

The department's statistics show that there are nearly 5,000 IT firms operating in the city. The IT industry has grown by 12 to 15 percent each year and contributed around 12 percent to the country's total IT turnover.-

Garment hub Thua Thien-Hue eyes industrial park

The central province of Thua Thien-Hue is considering the possibility of building an industrial zone exclusively designed for garments, an industry that generates over 20,000 local jobs.

Lying in the key central economic zone, Thua Thien-Hue is regarded as a garment and textile hub of the region.

With nearly 40 apparel production and processing firms, the province earned 500 million USD from garment shipments last year comprising nearly 80 percent of the local exports, said Chairman of the provincial People’s Committee Nguyen Van Cao at a workshop in the locality on May 5.

The industry grew by 32 percent in 2014, equivalent to 42.78 percent of local manufacturing value.

Initially, the province will focus on the support industry by providing incentives in land and raw material access, since most garment materials are now imported.

Participants suggested possible joint ventures to develop the complete value chain from synthetic fiber, weaving and dyeing to the end-user high quality products.

They also discussed ideas to develop the fashion industry and grasp opportunities arising from free trade agreements, especially the Trans-Pacific Partnership.

The workshop was co-hosted by the provincial People’s Committee and the Coordinating Board of the Central Coastal Region.

BIDV plays a growing role in Laos

The Bank for the Investment and Development of Vietnam (BIDV) has successfully invested abroad, particularly in Laos, according to a leader of the bank.

Phan Duc Tu, BIDV’s General Director, said that besides affiliation with partners from Malaysia, Russia and Cambodia, economic cooperation in the Lao market has played a significant role in the bank’s business operations over the past years.

Many Vietnamese firms in Laos agreed that BIDV, through its Lao-Viet Bank, Lao-Viet Insurance Company and BIDV Representative Office, has given them excellent guidance and advice in accessing the Lao market and expanding operations there.

Last year, BIDV’s join ventures helped the bank earn VND495 billion (US$22.9 million), it was reported at the annual shareholders’ meeting in 2015.

According to Tran Bac Ha, Chairman of the BIDV Board of Directors, the lender was one of the first Vietnamese commercial banks to invest abroad, with the formation of the Lao-Viet Bank in 1999. After 15 years of operation, the charter capital of the bank rose from an initial US$10 million to US$80 million in 2014. In the first quarter of this year, the figure reached US$100 million, he added.

Ha noted that currently, with five branches and three transaction offices across Laos, the Lao-Viet Bank is the second largest bank in the country in terms of charter capital, and the fourth in terms of outstanding loans.

Meanwhile, the Lao-Viet Insurance Company, set up in 2008 with charter capital of US$3 million, is now ranked the second biggest in revenue, and offers the widest coverage in Laos with 16 insurance supply points and its headquarters in Vientiane, Ha said.

The BIDV Representative Office in Laos has served as the most important driving force for the development of the bank’s international economic connections, he claimed.

The office has become popular among the Vietnamese business community in Laos, contributing to fostering economic partnership between the two countries.

At the same time, the BIDV also invested in many major projects in Laos , including a US$230 million project to build irrigation dykes in Luangnamtha province. The bank and the Lao-Viet Bank have also committed to provide credits to 23 key projects in Laos totalling US$740 million.

The BIDV has also spent VND220 billion (roughly US$10 million) on social and charitable activities in the country, added Ha.

Nghe An receives $335.7m in investment capital

The central Nghe An Province attracted about VND7.05 trillion (US$335.71 million) in investment capital during the first four months of this year, the provincial People's Committee reported.

The province issued licences to 49 new projects with a combined capital of about VND6.81 trillion ($324.28 million), and modified the licences for eight existing projects, whose capital was increased by a combined VND237 billion ($11.28 million).

The Department of Planning and Investment said Nghe An was concentrating on dealing with land clearance and simplifying procedures to speed up the progress of projects. The province also accelerated investment promotion with partners from Japan, South Korea and Singapore.

In Nghe An, a new industrial zone called Tuan Loc is expected to be built in May, and the construction of a Viet Nam – Singapore industrial, urban and service complex is slated to begin in June.

HCM City to host tool and metalworking exhibition

Metalex Vietnam, an international exhibition on machine tools and metalworking solutions, will return to HCM City this October, promising to offer a supreme sourcing destination of advanced metalworking technologies and solutions for local industrialists and manufacturers.

The exhibition, the biggest of its kind in the country, will feature the widest range of latest technology and know-how provided by 500 leading brands from 25 countries, said Duangdej Yuaikwarmdee, deputy managing director and general manager of Reed Tradex Co in Viet Nam.

Metalex Vietnam 2015 will be held at the same venue with the Vietnam Electronics Assembly 2015, an international machinery expo for electronic parts and components manufacturing.

To be orgainsed at the Saigon Exhibition and Convention Centre in HCM City from October 8-10, the two expos are expected to support the growth of all production lines in Viet Nam.

Satra Group opens 54th store in HCM City

Satra Group has opened its second convenience food store Satrafoods in HCM City's District 12, raising the total number of stores to 54.

Located in Nguyen Van Qua Street, the store showcases more than 2,000 items, of which over 80 per cent are fresh food, processed food, vegetables and household appliances. Satra is made up of 70 subsidiaries, affiliates and joint ventures, most of which are large enterprises like Vissan, Cau Tre and Agrex Sai Gon.

Agriculture, forestry and fish exports decline 6% on year

Viet Nam's agricultural, forestry and fisheries product exports reached US$2.61 billion in April, with the sector's total export value during the first four months rising to $9.13 billion.

This reflected a year-on-year decrease of 6 per cent.

According to the Ministry of Agriculture and Rural Development, the export value of major farm produce during the first four months brought home $4.47 billion, also down 6 per cent against the same period last year.

Of these, the export value of rice and coffee saw a sharp decrease of 9.2 per cent and 39.3 per cent, respectively.

The export turnover for seafood touched $1.87 billion, a fall of 16.6 per cent from the same period in 2014. The US remains Viet Nam's biggest seafood importer, accounting for 19 per cent of the total.

Seafood exports saw growth in China (17 per cent), Thailand (13 per cent) and the Netherlands (11 per cent).

Forestry products' export value increased by 6.7 per cent, compared with the same period in 2014, and reached $2.8 billion.

During the January to April period, Viet Nam shipped an estimated 466,000 tonnes of coffee worth $970 million abroad, down 41 per cent in volume and 39.3 per cent in value.

An estimated 1.95 million tonnes of rice was also sold to other countries for $849 million during the period, down 4.8 per cent in volume and 9.2 per cent in value. China continues to be the largest importer of Vietnamese rice, making up 27.3 per cent of the market share.

Cashew nut exports recorded growth in both volume and value. During the period, Viet Nam earned $635 million from selling 85,000 tonnes of cashew products, up 36.3 per cent in value and 14.1 per cent in volume from the same period last year.

Meanwhile, tea and pepper saw export volume slump, but its value increased. The country exported 33,000 tonnes of tea and 56,000 tonnes of pepper for $54 million and $513 million, respectively.

Industrial output sees sharp increase

There was solid improvement in business conditions in the manufacturing sector as improving client demand led to stronger rises in output and new orders, according to the April Purchasing Managers' Index (PMI).

The survey of around 400 manufacturing companies by Markit in co-ordination with HSBC found that higher production requirements led to increases in both employment and purchasing activity.

Meanwhile, there were further falls in both input costs and prices, although in each case the rates of reduction eased.

The headline seasonally adjusted PMI, a composite indicator designed to provide a single-figure snapshot of operating conditions in the manufacturing economy, rose to 53.5 in April from 50.7 in the previous month, signalling a solid strengthening of operating conditions.

The improvement was the strongest since the series began in April 2011.

Business conditions strengthened in each of the past 20 months.

Driving the overall improvement in business conditions was a sharp increase in new business as a number of firms reported having secured new customers. The rate of expansion was the sharpest in the series history. This was also the case with regard to new business from abroad, where growth was vigorous.

Growth in output resulted in a further reduction in work backlog as firms reported efforts to complete orders quickly, though the rate of depletion was the weakest in a four-month sequence of falling outstanding business.

Manufacturers hired extra staff to help meet production requirements in April. The modest rise in employment followed a decrease in the previous month.

Each month since November input costs decreased. Panellists reported lower costs for raw materials including oil, iron and steel, while some respondents had sought discounts from suppliers.

The latest fall in input costs was the slowest in five months. Decreasing costs was the main factor behind a further reduction in prices by manufacturing firms though the rate of decline fell for the third month running.

Suppliers' delivery times lengthened for the second straight month amid reports of raw material shortages. However, the rate of deterioration in lead times was marginal as prompt payments led some suppliers to speed up deliveries.

An increase in the number of new businesses led to a sharp rise in purchasing activity during April. Input buying rose in each of the last 20 months, with the latest expansion the strongest since April last year. This rise in purchasing led to an accumulation of pre-production inventories, the first in four months.

Stocks of finished goods also increased, following a decline during the previous month. Some panellists reported that finished products were awaiting delivery to clients.

Commenting on the survey, Andrew Harker, senior economist at Markit, said: "Growth of the Vietnamese manufacturing sector stepped up a gear in April, with the latest set of numbers the most impressive in the four-year survey history.

"Central to the improvement was success for firms in securing new clients, helped by a continued lack of inflationary pressure."

Gov't bond sales reach $394.5m at April auctions

The State Treasury of Viet Nam offloaded VND8.523 trillion (US$394.5 million) worth of government bonds in April.

According to Ha Noi Stock Exchange (HNX), the bonds were sold in 11 auctions it held for the treasury during the month.

HNX said while the coupon rate of five-year bonds was between 5.35 and 5.48 per cent per year, the coupon rate of ten-year bonds was 6.35 per cent per year and the rate of 15-year bonds was between 7.35 and 7.42 per cent per year.

In the primary market, the trading volume of bonds in April was 50.9 per cent less than that in March, HNX noted.

Meanwhile, in the secondary market, the total volume of outright trading in April amounted to 482 million bonds, worth VND51.1 trillion ($2.36 billion).

Trading volume through repurchase agreements (repos) was 275.8 million bonds, equivalent to VND27.9 trillion ($1.29 billion). The repos of government-backed bonds constituted VND4.5 trillion ($208.3 million) of the total.

Foreign investors made outright trading worth VND4.8 trillion ($222.2 million) in buying value and VND7.5 trillion ($347.2 million) in selling value. Foreign investors also made a repos buying of VND948 billion ($43.8 million) and had no repos selling in April.

New IP financing trend could help SMEs access credit, grow

An international symposium encouraged Vietnamese banks to provide loans using intellectual property (IP) assets as collateral to small- and medium-sized enterprises (SMEs).

This strategy aims to improve the sector's access to credit, and boost innovation and growth. It was discussed at an international symposium on intellectual property financing held yesterday in Ha Noi by the International Finance Corporation, the private sector lending arm of the World Bank Group.

According to Professor Xuan-Thao Nguyen, Gerald L Bepko endowed chair in law and an IFC secured transactions specialist, this form of lending wasn't new in the world. It was developed more than a hundred years ago in the US and is growing fast in China, Thailand and Malaysia.

Nguyen said IP financing reached US$34 to 50 billion in 2014 in China and was expected to grow faster this year. Thailand and Malaysia also created regulations on IP financing.

"SMEs are the ones that mainly create disruptive technology," she said. "They have new ideas and need banks to provide financing to help them participate in the knowledge-based economy."

According to a report by the Viet Nam Chamber of Commerce and Industry, SMEs accounted for more than 97 per cent of Viet Nam's businesses, but only 30 per cent of them could access credit from banks. The other 70 per cent needed to use their own capital or borrow from other sources at high costs.

Tran Thi Hong Hanh, general secretary of the Vietnam Banks' Association, said IP financing would play an important role in banks' lending activities, and had untapped potential for development in Viet Nam.

Hanh said the slowdown in the real estate market, accompanied by legal problems in dealing with property assets as collateral, caused difficulties for banks when choosing such collateral for loans.

"In Viet Nam, there is not much IP financing at commercial banks now, but the development of this form would help SMEs and thereby support national economic growth," Hanh said.

Vietnamese management authorities had shown interest in the trend and would build legal framework to facilitate its development, she said.

Nguyen said IP financing could help Vietnamese banks survive and compete with others. They could learn from the example set by the international community, which has more experience with the trend than Viet Nam does.

"Banks and lenders must understand IP law or hire experts to help them understand IP law," Nguyen said. "They also must conduct careful due diligence to learn about clients' businesses to make valuations."

She said Viet Nam's law-making authority should encourage IP financing, and improve regulations on foreclosure of assets – including IP assets.

"If we don't have a system that clearly allows banks and lenders to quickly foreclose collaterals, including IP assets, and allow them to sell those assets, banks will not be willing to lend," she said.

According to Charles Schmal, a Woodard Emhardt Moriarty Mc Nett and Henry LLP partner, most IP assets were valuable. He suggested new businesses think about IP rights at an early stage, and use them to persuade banks to give them loans.

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