VN agro, fish exports exceed US$10 billion 

 

The Ministry of Agriculture and Rural Development has reported that the turnover of the country’s agro and fish exports have reached over US$10 billion, an increase of 41.5% compared to the same period last year. 

 

In the first five months of the year, agricultural products reached US$2.1 billion. Rice, coffee, rubber and aquatic products were the leading export products.

 

In the review period, the country exported 3.5 million tons of rice for almost US$1.7 billion, a decrease of 18.6% in volume and 13.3% in value year-on-year.

 

Coffee exports exceeded last year’s turnover, with almost US$1.8 billion. The coffee sector is set to break the 2008 record of US$2.2 billion in the next two months.

 

Although the nation exported only 230,000 tons of rubber in the first five months, it recorded a double increase in revenue of US$1 billion, thanks to the world’s rubber prices reaching US$4,383 per ton.

 

Meanwhile, in the first five months of the year, Vietnam imported nearly US$6 billion worth of raw materials for agro-forestry and fisheries production.

 

Banks may miss restrictive credit targets

 

Many commercial banks say that all their efforts to reduce lending to non-manufacturing sectors are unlikely to meet the schedule set by the central bank.

 

According to a State Bank of Viet Nam (SBV) directive issued early March, banks have to keep credit growth to 20 per cent this year in order to contain inflation.

 

To this end, they are required to gradually reduce loans to non-manufacturing sectors from more than 26.8 per cent at present to 22 per cent by June end and 16 per cent by the year-end.

 

When the directive was issued, 18 of the 42 commercial banks had outstanding loans made to non-manufacturing sectors at over 25 per cent, and the remaining had them at over 26 per cent.

 

Following the central bank directive, many banks have changed their lending strategies although non-manufacturing loans are more lucrative. They have especially reduced lending for personal consumption and real estate projects as well as stock market transactions.

 

In a recent report, the Nguoi Lao Dong (The Labourer) newspaper cited the staff of a few banks as saying collecting payment on loans made for personal consumption or trading in securities was easy.

 

They said these were typically short-term loans made against collateral assets with high liquidity.

 

However, this would not apply to real estate loans because their loan structure was different, they said.

 

Most loans made to the real estate sector, which account for 80 per cent of lending to the non-manufacturing sector, had terms ranging between 3 and 5 years or even 10 years.

 

Significantly, many of these loans were made for high-end residential housing projects that were not easy to sell, particularly at a time when the market was stagnant, like now, the bank staff said.

 

The owners of many real estate projects have said they have not been able to sell their products to collect the cash and repay their bank loans.

 

The deputy general director of a commercial bank in HCM City said that his bank expected to reduce loans to the non-manufacturing sector to 25 per cent by the end of June, a reduction of 1 per cent compared with early March.

 

Representatives of many other banks have also admitted that they would be unable to meet the central bank's requirement on reducing credit to the non-manufacturing sector.

 

In fact, some banks have broken the central bank's cap of 14 per cent on deposit interest rates, increasing them to as high as 20 per cent to attract more savings. They have then treated this as money collected on outstanding non-manufacturing debts, the newspaper report said, but did not mention how this was done.

 

Meanwhile, senior managers of many banks have proposed that the central bank maintain the deadline for reducing credit to the non-manufacturing sector, but increase the ratio from the required 22 per cent to 24 per cent by late June and 16 per cent by the year-end.

 

The newspaper report also cited a central bank official as saying the State Bank of Viet Nam was likely to meet soon with commercial banks to discuss credit-related issues. They might apply different deadlines for separate banks for reducing non-manufacturing credit, the official said.

 

According to SBV Governor Nguyen Van Giau, 14 banks now have credit growth rates exceeding the 20 per cent cap, including the Western Joint Stock Commercial Bank (24 per cent) and the Viet Nam Thuong Tin Joint Stock Commercial Bank (26 per cent). He also said that as of May 23, the capital mobilised by banking sector had surged by 1.48 per cent as compared with the last few months of 2010.

 

Retail sales see slower growth during Jan-May

 

The retail sales value of goods and services increased by only 0.68 per cent (VND156 trillion) during May.

 

Compared to previous months, May saw the lowest increase in sales value, according to the Domestic Market Watch Board run by the Ministry of Industry and Trade.

 

The total retail sales value during the first five months of 2011 reached VND762.7 trillion, an increase of 22.5 per cent over the same period last year. Considering inflation, the value rose by only 6.4 per cent however.

 

The board attributed the slower pace of retail sales to high inflation, which has caused consumers to cut spending. Increased commodity prices have also caused sales volumes to fall.

 

During the first five months, commercial sector revenue, which accounted for nearly 80 per cent of the nation's total consumption revenue, rose by 23.6 per cent in comparison with the same period last year.

 

Last year, the country's total retail sales value of goods and services jumped by 24.5 per cent (VND1,561) against the previous year.

 

The retail industry annually contributes more than 15 per cent of the country's gross domestic product (GDP) and employs more than 5.4 million workers, representing over 10 per cent of Viet Nam's total workforce.

 

Pinnacle to buy 26 pct stake in developer of Vietnam casinos 

  

Pinnacle Entertainment Inc., the owner of seven US casinos, agreed to pay $95 million for a 26 percent stake in a Harbinger Capital Partners LLC-backed developer of two casino resorts in Vietnam.

 

Pinnacle will also manage a beachfront casino resort planned by the developer, Asian Coast Development (Canada) Ltd., about 80 miles (129 kilometers) southeast of Ho Chi Minh City, Vietnam’s largest city, according to a statement Thursday from the Las Vegas-based company.

 

The transaction represents Pinnacle’s first venture into Asia under Chief Executive Officer Anthony Sanfilippo, who joined the company in March 2010. Philip Falcone, whose New York-based Harbinger Capital is the largest shareholder in Asian Coast, wants Vietnam to mimic the success of Macau, China, and Singapore with integrated resorts that include casinos.

 

“It is a measured way for us to enter the Asian gaming market,” Sanfilippo said Thursday on a conference call, adding that talks began last summer. “We believe the potential return is significant.”

 

The casino to be managed by Pinnacle will be the second built by Asian Coast on the Ho Tram Strip, and will open after a casino resort that MGM Resorts International will manage.

 

Asian Coast CEO Lloyd Nathan expects to open the MGM Grand Ho Tran in 2013, managed by MGM Hospitality, in the first phase of the planned $4.2 billion Ho Tram Strip. That corridor will have five resorts, including two with casinos, on 420 acres (170 hectares) along 2.2 kilometers of beaches overlooking the South China Sea. The plan also includes residential areas, with Asian Coast being the government-approved developer.

 

Currently, only foreign passport holders can gamble in Vietnam, meaning the resorts will primarily cater to about 5 million tourists who visit the country annually.

 

“While this morning’s announcement came as a bit of a surprise to us, we believe the ACDL deal presents compelling return prospects for Pinnacle’s modest $95 million investment,” Steven Wieczynski, an analyst at Stifel Nicolaus Capital Markets, said in a note to investors. “Management could use its Ho Tram Strip management agreement to test the waters in Asia.”

 

Pinnacle fell 19 cents to $14.47 at 11:49 a.m. in New York Stock Exchange composite trading.

 

Khanh Hoa oil and gas base to help ease southern operations

 

The central coastal province of Khanh Hoa has issued an investment licence to Sao Mai-Ben Dinh Oil and Gas Joint-Stock Company allowing the construction of the Van Phong oil and gas service base.

 

The base, worth VND25.772 billion (US$1.29 billion), will be constructed in the Hon Khoi area of Ninh Hoa town.

 

The base will include a seaport, drilling platform, floating facility and a tank compound for the storage of oil and gas, liquefied petroleum and related petroleum chemicals. The area will additionally include offices and services.

 

Construction, to be divided into three phases, will conclude in 2017. The VND2.870 billion ($140 million) first phase will kick off later this year and conclude in 2012.

 

Tran Hai Binh, chairman of Sao Mai-Ben Dinh, said that investment is expected to help ease the overloaded operation of logistics services related to southern oil and gas industry.

 

Vietnam’s exports to India change positively

 

The two-way trade turnover between Vietnam and India in the first four months this year reached over US$1.26 billion, rising by 50 percent compared to the same period in 2010, according to the General Department of Vietnam Customs.

 

Export turnover achieved US$375.7 million and imports were US$885.8 million.

 

In the first quarter alone, the value of Vietnam’s exports to India increased by 88.3 percent against last year, and was mainly iron and steel, coffee, machines, spare parts, computers and electronics.

 

New Vietnamese products that entered Indian market were hardware, electronics, garments and textiles, showing the mechanisms for Vietnam exporting to India are changing in a more positive direction.

 

India’s recognition of Vietnam’s Market Economy Status (MES) is expected to create an important foundation for sustainable development of trade and investment between the two countries.

 

Vietnam exports to Mexico on the rise

 

In the first three months of 2011, Vietnam’s exports to Mexico reached US$214 million, up 20 percent against the same period last year, said the Commercial Section at the Vietnamese embassy in Mexico.

 

The increase was attributed to the rise in both the volume and prices of traditional products exported to the country such as footwear, garments, textiles, and seafood.

 

The recovery of the Mexican economy was also a factor which increased the value of Vietnamese exports to the country.

 

Meanwhile, Vietnam’s imports from Mexico fell to US$12 million, about 50 percent less than the same period last year.

 

In 2010, trade turnover between the two countries was US$914 milllion and it is estimated to be over US$1 billion in 2011.

 

Automobile imports pick up

 

Vietnam imported 26,900 cars in the first five months of 2011, up 45.7 percent in quantity and 65.4 percent in value against the same period last year, said the General Statistics Office.

 

Automobile imports, including spare parts, reached US$1,339 billion, an increase of 23.7 percent.

 

Meanwhile, only 30,600 motorbikes, worth US$ 405 million, were imported, down 21.1 percent in quantity and 4.8 percent in value.

 

In May alone, Vietnam imported 5,500 cars and 3,200 motorbikes worth US$137 million in total.

 

Closer management of imports

 

The General Department of Vietnam Customs (Vietnam Customs) will keep closer control over the prices of some imported products as of June 1.

 

The products that will come under stricter controls are frozen meat and fish, fresh fish, ceramic tiles, sanitation products and equipment, household appliances, and electric bikes.

 

Vietnam Customs will also increase the taxable prices of motorbikes, trucks, and vehicles that can carry fewer than 16 passengers.

 

Malaysian bank joins ATM network

 

Malaysia's Hong Leong Bank has joined Smartlink, a network of more than 5,500 ATMs run by several domestic and foreign banks.

 

It also becomes the first foreign bank to offer several ATM services, including cash withdrawal and transfer of funds, free of charge.

 

Hong Leong Bank Viet Nam commenced operations in October 2009 with a branch in HCM City. It opened a branch in Ha Noi earlier this year. Hong Leong Group, its parent, has invested in the Canary complex in southern Binh Duong Province and has a 20 per cent stake in Yamaha Motor Viet Nam, among others.

 

VinpearlLand opens new resort

 

VinpearlLand Company on Saturday opened a five-star resort complex and 18-hole golf course. Both of these projects are situated in the Vinpearl tourism area on Hon Tre island, central Khanh Hoa Province.

 

The Vinpearl Luxury resort covers an area of 71,800 square metres and features 84 villas and is equipped with high-class facilities. The 184-metres golf course also includes other sport facilities such as a swimming pool, fishing pool and tennis courts.

 

US Pinnacle to join Ho Tram Strip

 

Canadian Asian Coast Development Ltd (ACDL), owner of the Ho Tram Strip beach front complex of resorts and residential developments, has announced the acquisition of a 26-per-cent equity interest by Pinnacle Entertainment Inc. The acquisition totalled US$95 million.

 

Pinnacle has entered into a management contract for the second integrated resort of the multi-phase Ho Tram Strip project.

 

"Participation in the development of the Ho Tram Strip was highly sought after and we are delighted to be a part of Viet Nam's strategic vision for the further development of its tourist industry as an investor in ACDL and a partner on the Ho Tram Strip project," said Anthony Sanfilippo, President and Chief Executive Officer of Pinnacle Entertainment.

 

The second integrated resort of the Ho Tram Strip is expected to be similar in scope to the MGM Grand Ho Tram resort currently under construction. The strip will be Viet Nam's first destination for integrated resorts and gaming complexes and is scheduled to open in multiple phases, beginning in 2013.

 

Export earnings to Mexico up 20%

 

Viet Nam earned US$214.5 million from exports to Mexico in the first quarter of this year, up almost 20 per cent over the same period of 2010.

 

The growth in Viet Nam's export turnover was attributed to a rise in both volume and prices of export items to the North American country such as footwear, garments and aquatic products.

 

The Trade Office of the Vietnamese Embassy in Mexico said the recovery of the Mexican economy was seen as a factor that boosted the inflows of imports, including those from Viet Nam.

 

During the January-March period, Viet Nam imported $12.1 million worth of goods from Mexico, a year-on-year decrease of 46 per cent from the same period a year ago.

 

Thai Binh studies trade opportunities

 

India as a potential market was a major theme during a conference in the northern province of Thai Binh on Wednesday.

 

The event was aimed at helping local businesses exploit the benefits of the ASEAN – India Free Trade Agreement that took effect last year. At the get-together, representatives from the Indian Chamber of Commerce briefed local businesses on India's customs procedures and import-export policies while provincial leaders introduced local businesses and projects in need of investment.

 

Cambodian bank opens branch

 

The Bank for Investment and Development of Cambodia (BIDC) officially launched a branch in Ha Noi on Thursday.

 

BIDC Ha Noi, with a charter capital of US$15 million, is equipped with Temenos 24, one of the best core banking products available.

 

The branch will offer a variety of products and services to customers including e-payment, credit card and remittance payment facilities.

 

More steel plants built despite lack of power and need

 

More and more high capacity steel plants are being built in Vietnam, using large amounts of the country’s scarce electricity to operate them, even though there is not a supply shortage or heavy demand for the material in the country while only a small amount is exported.

 

The Vietnam Steel Association (VSA) said that nine more steel-making plants in Vung Tau, Binh Duong and Da Nang with the total capacity of over 2 million tons of construction steel and 1 million tons of rough draft steel will be up and running in June.

 

The increasing number of newly built and operating steel plants has boosted the number of steel produced every month.

 

Pham Chi Cuong, head of VSA, said the steel production capacity of all steel plants in Vietnam through March was 8.99 million tons per year and total consumption was only 6.32 million tons per year.

 

While there is 3 million tons of redundant steel per year, the amount exported is still small.

 

Nguyen Tien Nghi, deputy head of VSA, said only 160,000 tons of construction steel was exported in 2010, which is a low number compared to the production capacity of the plants in Vietnam.

 

Huynh Kim Tuoc, director of the Energy Conservation Center of Ho Chi Minh City, said the steel industry is using a great deal of electricity to operate its plants.

 

The Shengli steel plant in the northern province of Thai Binh, with the capacity of 600,000 tons of steel per year, needs 300 MW to operate.

 

This is extremely high, as the total capacity of the Tri An Hydroelectric Power Station is only 400 MW, he said.

 

Vietnam’s Visa market grows most: expert

 

Lorijon Bacchi, director of the Indochina region of the payment card network Visa, said Vietnam has had the strongest growth of all Visa markets.

 

Vietnam is new in the online payment market but she said last week that it has vast potential thanks to huge growth in terms of international payment card numbers, total number of transactions and total revenue of transactions by cards.

 

By late last year, Visa had 1.5 million cardholders in Vietnam, an increase of 22 percent, the strongest Visa growth in the region.

 

The total revenue of transactions of Visa in Vietnam in the first quarter was US$176 million, an increase of nearly 60 percent year-on-year.

 

Bacchi said she appreciated the potential of Vietnam’s card market given its current strong development of e-commerce.

 

“Vietnam has the biggest number of people using mobile phones among countries I have ever come across,” she said, adding that 31 percent of the Vietnamese population use Internet, while the country ranked 17th among the countries joining online social networks. Online trade revenue of Vietnamese firms last year rose by 50 percent from the previous year.

 

She said that e-commerce was a good foundation to develop online payments so that in the future institutions would help to strengthen the online system in Vietnam by making it convenient for banks to join the operation and widen their card acceptance point network, and offer training for bank staff.

 

The company has cooperated with 30 local and foreign banks in Vietnam.

 

All card products and money transfer operations are provided by banks while all payment transactions are done by Visa’s system.

 

Last year, global payment revenue via Visa cards was around US$3.3 trillion.

 

Advice for Vietnamese companies exporting to France

 

French experts gave advice to Vietnamese exporters to increase their opportunities when expanding its market into France in a seminar entitled “French market: opportunities and practices” held by the Vietnam Chamber of Commerce and Industry (VCCI) and the French Chamber of Commerce and Industry in Vietnam (CCIFV) in Hanoi last week.

 

Olivier Monange, from the DS Avocats Law Office, said Vietnamese companies exporting to France need to pay close attention to the customs and tax procedures.

 

He also urged Vietnamese exporters to find professional distributors and take care when arranging which international arbitration center should be called and which country’s laws should be followed in case of business disputes.

 

He added that Vietnamese firms need to consider opening agency branches and offices in France if they want to export more into the country.

 

Guillaume Crouzet, head of CCIFV, said Vietnamese firms have to study more about French business culture to be successful in expanding into this market.

 

Currently, there are more than 100 ASEAN firms investing in France with a total investment of EUR2.13 billion.

 

Vietnam c.bank has no policy to cap loan rates: report

 

Vietnam's central bank does not have any policy to cap interest rates, Governor Nguyen Van Giau was quoted as saying on Friday, responding to talk that the authorities were considering such a cap after a jump in rates.

 

"There have been opinions on this issue but there are no policies yet," Giau told the state-run Vietnam Economic Times newspaper in an interview.

 

"If there is a surplus in credit supply, it could be done, but now the supply is short so it cannot be imposed," he said.

 

Market rates have gone as high as 22-27 percent and businesses are complaining, prompting speculation the central bank could impose a ceiling on lending rates offered by state-owned banks.

 

Three fully owned state-run banks plus listed VietinBank and Vietcombank command the bulk of Vietnam's lending market.

 

The central bank wants to ensure adequate funding for the economy but it is also trying to curb inflation, and to that end it has pushed up policy interest rates and is trying to keep banks' credit growth below 20 percent this year.

 

Annual consumer price inflation stood at nearly 20 percent in May, the highest since December 2008.

 

Due to the high rates on bank loans, companies have withdrawn deposits from banks for investment purposes, leading to a 2.75 percent fall in dong deposits as of May 23 compared with the end of 2010, Giau told the newspaper.

 

The fall in corporate deposits amounted to VND156.7 trillion ($7.64 billion), but individuals had put funds worth VND107.3 trillion into banks in the same period, leaving personal deposits 11.84 percent higher than at the end of last year, Giau said.

 

Vietnam posted credit growth of 6.2 percent as of May 23 against the end of 2010. Lending for agricultural production and the export sector rose 22.2 percent, the governor said. He gave no value for Vietnam's total outstanding loans. ($1=VND20,510)

 

VN needs stronger efforts for businesses

 

Vietnam needed more efforts to solve difficulties and carry out long-term goals for improving the economy’s efficiency and competitiveness in the coming years, the Vietnam Business Forum (VBF) said in Hanoi.

 

The goals were completion of the framework of regulations for investment, improvement of administrative procedures, development of infrastructure, human resource training and facilitating investors, representatives from Vietnam Ministry of Planning and Investment (MPI), the World Bank (WB) and the International Finance Organisation (IFC) said at the VBF, which took place ahead of the mid-year Consultative Group meeting of donors for Vietnam.

 

MPI Minister Vo Hong Phuc, Acting WB Director Alain A. Barbu and IFC Director of Simon Andrews noted impacts like price hikes and inflation on the economy and highlighted the Government’s prompt adoption of Resolution 11 to stabilise the macro-economy, curb inflation and ensure social security.

 

Chairman of the European Businesses’ Association (Eurocham) Alain Cany expressed his belief in Vietnam’s capacity to maintain its competitiveness and sustainable growth, affirming Eurocham’s efforts to raise Vietnam’s image as a destination for trade and investment for both European and Vietnamese firms.

 

He emphasised five main areas for this year, including completion of regulations for investment, protection and increase of legal execution for intellectual property rights, improvement of infrastructure and energy supply sources, and administrative reform.

 

Amcham Chairman Christopher Twomey shared his view on how to improve the business climate and promote socio-economic development in Vietnam.

 

He stressed that the environment for business would be most effectively improved through Government moves to maintain balance between short-term economic development and support for long-term growth, in order to create an attractive environment for companies.

 

At the VBF, representatives of the Vietnamese Government and the business community discussed issues relating to banking, capital markets, business challenges and infrastructure.

 

Vietnam exports earn $34.7 bln in Jan-May

 

Vietnam’s exports growth reached 32.8 percent in the first five months to a total of US$34.7 billion, the Ministry of Industry and Trade has said.

 

Goods that experienced strong growth included garments, footwear, electronics, crude oil, rubber and coffee.

 

During this period, garment exports topped the list of hard currency earners with over $5.1 billion, a rise of 35.6 percent year-on-year. The US remained Vietnam’s largest importer, followed by the European Union and Japan.

 

Except for crude oil, footwear exports ranked second in the list with $2.37 billion in revenues, enjoying a year-on-year rise of 31.8 percent. Footwear was followed by aquatic products with revenues of $2.1 billion, up 31 percent.

 

Export revenues of rubber and coffee were over $1 billion and $1.77 billion, respectively, more than double the same period last year.

 

According to the ministry, higher priced commodities, thanks to the recovery of the global economy, were the main reason for Vietnam’s export growth, especially to European markets.

 

By contrast, imports rose strongly. Until the end of May, the whole country imported $41.3 billion, up 29.5 percent from the same period of last year, pushing the trade deficit to $6.5 billion and accounting for 18.8 percent of the gross export value.

 

Exporters are urged to establish new markets, engage in trade promotion activities, make the most of free trade agreements, and to prioritize the use of domestic fuel, raw materials and equipment to gradually reduce trade deficit.

 

Beltway ready to hit first gear

 

A huge roading project is sourcing the prime ministerial approval to get off the ground.

 

The Ministry of Transport (MoT) recently sent Proposal 2841/TTr-BGTVT asking the prime minister to green-light the detailed planning of Hanoi region’s beltway 4 section south of national highway 18 - after procuring sufficient comments from relevant ministries, departments and local governments.

 

In respect to why the MoT was yet to establish the whole 136.6km Hanoi region’s beltway 4 project, the MoT Minister Ho Nghia Dung said: “First, it is impossible to invest in such a huge project one time due to our still tight budget. Second, construction of the southern section gets high approval from relevant competent bodies with stable construction volumes.”

 

Under MoT’s detailed planning, the section will go across 14 cities and districts in the capital and northern provinces of Hanoi, Hung Yen and Bac Ninh.

 

“Beltway 4’s core targets are to bridge urban satellite and peripheral industrial zones with Hanoi’s core region and ease traffic congestion in relevant areas,” said chairman of Transport Engineering Design Inc. (TEDI) Pham Huu Son.

 

Accordingly, the highway section will use up to 1,230 hectares with 740ha in Hanoi, 230ha in Hung Yen and 260ha in Bac Ninh.

 

The project will need around VND66.5 trillion ($3.21 billion) in a total investment capital, of which construction cost will be around VND36.1 trillion ($1.74 billion) and VND10 trillion ($483 million) for site clearance and compensation.

 

The big project is divided into seven subprojects to facilitate implementation.

 

The MoT also suggested handing over subprojects to local governments in localities where the highway section runs through to diversify investment sources. Accordingly these localities are encouraged to handle these subprojects under build-transfer (BT) and build-operate-transfer (BOT) and make use of available land funds.

 

Some road sections would be built sourcing state budget or official development assistance (ODA) capital, according to MoT.

 

Vietnam Road and Bridge Association’s deputy chairman Nguyen Ngoc Long assumed that beltway 4’s subprojects, especially sections crossing Hanoi, are particularly attractive to investors given the fact that Hanoi’s traffic volume is forecast to reach 38,279 vehicles per day by 2020.

 

“With investment of several hundred million US dollars for each subproject and capital recouping process of 20-40 years investors cannot act independently. In this context, promoting public-private partnership model and making use of available land funds will be viable remedies,” Long said.

 

PV