Japanese, Vietnamese localities seek to boost links

A delegation of representatives from the Japan-Vietnam Friendship Association (JVFA) in Sakai, Japan and firms operating in the city visited the central province of Binh Dinh on February 5 to promote links between the two localities.

During a meeting with provincial key officials, JVFA President Hitoshi Kato said there is great potential for Binh Dinh to develop many fields such as industry, tourism, and fishing industry.

He committed to providing the Vietnamese locality with more 20 sets of Japanese advanced fishing devices to help local fishermen catch ocean tuna meeting the Japanese market’s requirements.

Koritaro Goto from Kohnan Shoji stated that his firm – the second largest retailer in terms of turnover in Japan- is considering to import Binh Dinh’s commodities, including wooden products, interior decoration and garments to distribute in the company’s supermarket system in Japan.

Meanwhile, Tsuyoshi Kato from Sanicon Group said his firm looks to establish ties with Binh Dinh in water treatment and manufacture of water-treatment devices.

Representatives from Bunrin Gakuin Japanese language school affirmed they will team up with Binh Dinh’s authorities and Quang Trung University to design Japanese-training programmes in the locality.

Chairman of the provincial People’s Committee Ho Quoc Dung stated that the local authorities will facilitate operations of Kasai businesses and organisations.

The JVFA in Sakai and Binh Dinh province have promoted cooperation in many fields between the two localities. Japanese Kato Hitoshi General Office Co Ltd supported the Vietnamese locality in a programme to improve the quality of ocean tune by using the Japanese fishing technology.

At present, the two localities are working hard to expand their cooperation in other fields.

AIA insurance group commits long-term operation in Vietnam

The AIA life insurance group will work long-term in Vietnam and hopes to be facilitated to expand its products, President and Executive Director Mark Edward Tucker said.

Tucker made the remarks while meeting with Vice Chairwoman of the National Assembly Nguyen Thi Kim Ngan in Hanoi on February 5.

The Vietnamese legislator said she welcomed the AIA’s activities to support underprivileged, disabled children, orphans, and flood victims, as well as its business operations meeting financial security and accumulation purposes of organisations and individuals.

She underlined Vietnam’s policy of opening the insurance market in line with international commitments whilst encouraging various operational forms of insurance businesses both at home and abroad.

In the coming time, the State-run insurance agency will improve policies and procedures in the field to help businesses endure difficulties and secure sustainable market development.

She suggested the AIA continue to strengthen legal business activities and help Vietnam improve the legal framework for the insurance business environment via exchanging information on business practices and international standards.

ODA disbursements at record high

Disbursements of official development assistance (ODA) for projects and programs in Vietnam amounted to an all-time high of US$5.6 billion last year.

The ODA disbursements are made clear in a report by the Ministry of Planning and Investment. They included US$5.25 billion in ODA loans and US$350 million in grants. Around US$2.5 billion of the total was disbursed for basic construction projects.

The report said major international donors continued maintaining high disbursements with US$1.773 billion from Japan via the Japan International Cooperation Agency, US$1.386 billion from the World Bank and more than US$1 billion from the Asian Development Bank (ADB).  

The major ODA-funded projects put into use last year included the Nhat Tan bridge and road, the second passenger terminal T2 at Noi Bai International Airport and Noi Bai-Lao Cai Expressway.

In addition to transport infrastructure, numerous major projects financed by ODA and concessional loans were put into operation in the fields of energy, water supply, waste water and garbage treatment, environmental sanitation, education and training, and health. These projects have contributed much to socio-economic development and economic restructuring.

Last year, Vietnam recorded positive socio-economic performance with the economy expanding 5.98% and having a trade surplus of US$2 billion. The Government has set an economic growth target of 6.2% for this year.

At a recent meeting between the Steering Committee for ODA and concessional loans and international donors and banks in Hanoi, Vietnam was hailed for successful implementation of ODA-funded projects.

For instance, the percentage of successful projects funded by ADB is 82.1%, well above  65.2% in India and 63.2% in Indonesia.

The average interest rate of ODA loans provided by international donors for Vietnam is 1.6% a year and maturity is 12.8 years. This annual interest rate is much lower than 7.7% for government bonds issued for domestic investors and 4.85% for overseas investors, and their maturity is 2.6 and 10 years respectively.

At the meeting, foreign lenders mentioned problems with ODA-funded projects such as time-consuming procedures and preparations as well as the financial allocation mechanism for ODA and concessional loan pledges.

New ODA and concessional loans for Vietnam last year tumbled by 32% year-on-year to more than US$4.36 billion last year, Vietnam News Agency reports, citing figures at the meeting chaired by Deputy Prime Minister Hoang Trung Hai. The amount included over US$4.16 billion in ODA loans.

The drop was attributable to the fact that agencies focused on preparations for and the quality of projects to be funded by ODA and concessional loans to keep the country’s public debt at a safe level.

The planning ministry pointed out another reason that major economies in the world are still coping with a host of challenges and more ODA funds have gone to the least developed countries and the countries with political unrest.

In this context, developing countries, particularly a middle-income nation like Vietnam, have to make more effort to maintain international funding sources and at the same time manage to attract finances from other sources including the private sector, remittances, and investment funds for their infrastructure projects.  

Deputy PM Hai was quoted by the Government’s portal chinhphu.vn as saying at the meeting that ministries and local authorities should ensure the efficient implementation and disbursements for ODA-financed projects and programs at a time when it is difficult to find new sources of capital.

Hai said there remain ODA funds of up to US$21 billion for projects and programs in the country and slow disbursements would lead to losses of hundreds of millions of U.S. dollars for opportunity costs a year.

Therefore, Hai called for ministries and localities to enhance their management of ODA disbursements. The ministries of planning-investment and construction were told to review shortcomings and establish inspection groups to ensure the better use of such low-interest loans.

Hai noted the bribery allegations involving Japan Transportation Consultants Inc. (JTC) in a railway project in Hanoi were a shame and ordered relevant agencies to strictly supervise operations to detect irregularities.

HSBC warns of subdued export growth

HSBC Bank has forecast Vietnam’s export growth would continue slowing this year and would decelerate to 12% from the 13.6% recorded last year due to the impact of slowing commodity prices, falling external demand and waning currency competitiveness.

In a macro economics report released on February 3, the bank said although exports have achieved double-digit growth in recent years, the rates have declined.

Last year, the country’s exports reached the US$150-billion milestone, expanding by 13.6% versus 2013. However, that is a deceleration from 15.2% growth in 2013 and 18.2% growth in 2012.

The drop was attributable to the decline in commodity shipments in value and volume, especially crude, rubber, coal and rice. Meanwhile, footwear, apparel, aqua products, phones, and computer parts exports rose sharply, primarily thanks to Vietnam’s relative labor cost competitiveness (up 22%, 16%, 18%, 13% and 10% respectively in 2014).

“We believe the same trend will dominate export growth in 2015 – manufacturing exports will outperform, while commodity-based shipments will slow,” HSBC said in the report.

Regarding currency competitiveness, a recent directive of the central bank stated that currency stability is a priority and the central bank will only devalue Vietnam dong by a maximum of 2% against the U.S. dollar this year.

The central bank already adjusted up the reference rate by 1% in early January, leaving room for only another 1% devaluation in the rest of the year. Since December last year, the currency has actually appreciated while other currencies, including the euro and the Chinese yuan, depreciated.

The question is whether Vietnam’s exports will lose competitiveness if its nominal effective exchange rate continues to appreciate.

“Given Vietnam’s still comfortably low wage costs, we believe the cost competitiveness issue will only weigh on exports if China and ASEAN countries weaken their currencies. Vietnam’s exports are negatively correlated with the U.S., the EU and Japan, making them complimentary trade partners. Therefore, the depreciation of the euro and the Japanese yen will unlikely weigh on export competitiveness meaningfully,” it said.

China, on the other hand, still has a large labor-intensive manufacturing share globally. As a result, Vietnam and China’s trade correlation index (TCI) are well correlated, suggesting that a sharp depreciation of the yuan may hurt Vietnam’s export competitiveness.

While HSBC’s forex team does not forecast a sharp weakening of the yuan-dollar exchange rate by year-end 2015, this remains the largest risk to Vietnam’s exports.

Second turbine of Vung Ang 1 thermal power plant reaches design capacity

The second turbine of Vung Ang 1 thermal power plant reached its maximum capacity of 600MW at 2:57 pm on February 5, according to the Vietnam Machine Installation Corporation (Lilama) - the main contractor of the plant.

The second turbine of Vung Ang 1 plant was connected to the national grid on November 10, 2014 for a trial run and operation achieved maximum capacity yesterday, meeting all technical specifications.

Lilama expects to hand over the second turbine to the National Oil and Gas Group (PVN), the investor of the Vung Ang 1 plant, for commercial operation in late March 2015 as scheduled.

Meanwhile, the first turbine of the plant was handed over to the PVN for commercial use on December 20, 2014.

Vung Ang 1 is a coal-fired power plant which boasts the largest capacity (600MWx2) in Vietnam operated by a local contractor under the EPC (Engineering-Procurement-Construction) contract.

The thermal power plant is a key national power project which will generate around 8 billion kWh of electricity each year.

Ethanol gasoline blend prices reduce

Vietnam National Petroleum Group officially reduced the price of E5 Ron 92 fuel, a mixture of 95 percent gasoline and 5 percent ethanol, by VND320 a liter to VND15,350 since February 5 afternoon.

According to the group, the price cut is to suit petrol product prices in the world market. The prices of Ron 92, diesel, engine oil and kerosene remain steady.

On the same day, the Ministry of Industry and Trade decided to reduce contribution level to the price subsidization fund by VND460 a liter of gasoline, VND280 a liter of kerosene, and VND530 a kilogram of engine oil.

The level has been widened by VND20 a liter of diesels and VND40 a liter of E5 gasoline.

Petrol prices have been cut for two times since early this year. The first reduction was VND310 a liter on January 6 and the other totaled VND1,900 on January 21.

Last year petrol prices were lowered for 12 times while diesel and kerosene prices were lessened for 14 times.

HAGL's first Australian beef products introduced to HCM City market

Vissan Company Ltd, a domestic meat processor and supplier, and Hoang Anh Gia Lai Joint Stock Company (HAGL) will sell 2,000 Australian cows to the local market to serve the Tet (Lunar New Year) holiday.

These are the first products to be marketed locally under the cooperation of the two companies, the company said on Wednesday in HCM City.

Doan Nguyen Duc, chairman of HAGL, said the cows, which were imported from Australia, are 18 months old and over, weighing 200-250kg each.

They have been fed at HAGL's farms in Viet Nam, Laos and Cambodia. Each will weight about 500-550 kg when they are sold to the market.   

At the ceremony to introduce the first product to the market, a representative of Vissan said the demand for beef in Viet Nam was about 3,000-4,000 cows per day.

The Australian beef products of Vissan and HAGL are sold at Satra, Saigon Co-op Marts and Vissan's outlets for about VND320,000 (US$16) per kilo. - Photo ndh

In HCM City, the figure is 600. To meet demand, each year the country imports 1 million cows.

Co-operation between the two companies has played an important role in localising cow feeding in Viet Nam.

This year, HAGL plans to feed 100,000 cows, and the figure is expected to increase to 200,000 in 2016.

Duc said the company plans to invest more in feeding oxen as the sector has been very profitable.

The Australian beef products of Vissan and HAGL are sold at Satra, Saigon Co-op Marts and Vissan's outlets for about VND320,000 (US$16) per kilo.

A promotion from February 10 to 25 will offer the products for VND8,000 per kilo.

HAGL has shifted their investments to agriculture. In mid-2014, it signed co-operation agreements with Nutifood and Vissan to develop a project to raise cows and oxen, and to build a processing plant.

Vingroup to add 25 shopping malls across Vietnam in 2015

Giant Vietnamese real estate developer Vingroup will open 25 new shopping malls across the country this year, the company announced Tuesday, along with a decision to increase investment in a megaproject.

The new trade centers will be developed under Vingroup’s flagship brands, Vincom and Vincom Mega Mall, the Hanoi-based realty developer told the media.

The new facilities will have an occupancy rate of 70 percent, with Vingroup’s strategic partners and affiliates such as BHD, CGV, Golden Gate, Highlands Coffee, Vinmart, Vinpro, VinKE, Vinpearl Land, and Emigo committed to renting stores there.

The Vincom and Vincom Mega Mall chains are developed and operated by Vingroup’s retail unit, Vincom Retail. The company boasts a 90 percent occupancy rate at its existing malls.

Vingroup currently has five Vincom malls – two each in Hanoi and Ho Chi Minh City and one in the northern province of Quang Ninh – and two Vincom Mega Mall venues, both in the capital city, according to Vincom Retail’s website.

The new shopping malls will be built in 19 provinces and cities,Reuters reported on January 15, citing an email statement from Vingroup.

But the cost of this expansion has not been disclosed.

Vingroup also announced on Tuesday that it will increase the total capital for the Vincom Mega Mall Thao Dien in District 2, Ho Chi Minh City by VND1 trillion (US$46.6 million).

The VND3.5 trillion ($163.11 million) mega-shopping mall will thus become the largest of its kind in the eastern area of the southern metropolis, according to Vingroup.

Vincom Mega Mall Thao Dien will be built as part of the Masteri Thao Dien deluxe urban area, which is being developed by Thao Dien Investment JSC.

The Masteri Thao Dien project features deluxe shopping venues, cuisine areas, a cinema complex, and a modern entertaining center.

Thao Dien is a ward in District 2, known as a hub of luxury villas and apartments.

Vietnam has a population of 90 million and the size of its middle class is expected to double by 2020, owing to annual economic growth of over five percent since 2000, according to Reuters.

The Southeast Asian country also has the world's fastest-growing number of super-rich, with Vietnamese holding net assets of at least $30 million projected to swell to 293 from 110 in a decade, Reutersquoted a 2014 report by property consultancy Knight Frank.  

Vingroup is one of Vietnam's fastest-growing firms, with a market capitalization of $3.2 billion, whereas its retail arm had total assets worth $1.7 billion last year, according to Reuters.

The firm was twice named winner of the “Best Developer Vietnam” category at the annual South East Asia Property Awards in 2013 and 2014.

The Asia Property Awards work to showcase the Asian real estate industry, boosting awareness and highlighting top quality developers, projects and services, according to its website.

A Vietnamese beverage producer has agreed to pay half a billion dong to buy the silence of a customer who found a dead fly in an unopened bottle of its energy drink.

But before sending a representative to complete the payment, Tan Hiep Phat Co. Ltd. also reported to the police, who eventually arrested the customer for alleged “confiscation of property.”

The case has started a debate among local members of the public and lawyers as to whether Vo Van Minh, an eatery attendant in the southern province of Tien Giang, should receive a criminal charge for his act.

On January 3, Minh found a Number One bottle at his eatery that contained a fly and decided to call the company, headquartered in the southern province of Binh Duong, asking for VND1 billion (US$46,600) to not make the incident public.

The man threatened to report the case to the Binh Duong customer protection association and the media, and print 5,000 leaflets to scatter around the province to damage the company’s reputation, according to Tien Giang police.

Tan Hien Phat ended up agreeing to pay him VND500 million ($23,300) after three rounds of negotiations, and secretly reported the situation to the police.

Minh was arrested when he was about to receive the money at a café in Tien Giang on January 27 and has remained in police custody since.

Nguyen Tan Thi, a lawyer from the Ho Chi Minh City Bar Association, who was invited to defend Minh, said the man only wanted to receive compensation from Tan Hiep Phat for the bad product.

A customer has the right to do so and negotiate with the manufacturer, he said, citing the law on consumer protection.

Minh is allowed by law to ask for a certain sum of money, according to the lawyer, and by saying he will cause damage to the company, Minh only “wanted to win the negotiation rather than threaten it.”

“Tan Hiep Phat accepted the request for the company’s sake rather than being forced or threatened to do so,” Thi said.

“Minh’s request could be irrational but it is allowed by law and Tan Hiep Phat reserves the right to refuse it.”

Bui Quang Nghiem, deputy chairman of the Ho Chi Minh City Bar Association, also said Minh’s act does not violate the law, but “morally speaking, it is inappropriate as he asked for quite a huge sum of money.”

The lawyer also said Tan Hiep Phat had broken its promise by reporting the case to police while it had agreed to pay the money.

“Also in terms of morality, I think Tan Hiep Phat is no better than the customer,” he said.

Prosecutor Nguyen Van Chung, head of the People's Procuracy of Ho Chi Minh City’s District 3, had a different view.

Chung said it is normal for a consumer and a manufacturer to negotiate for compensation, and the latter voluntarily agrees to pay money.

“But if the customer takes advantage of the incident to threaten the business, making the latter unwillingly pay the money, that act is a sign of confiscation of property,” he pressed.

Pham Le Tan Phong, director of public relations with Tan Hiep Phat, said the company always wishes to satisfy the needs of customers, except for “requests that are unnecessarily unreasonable.”

Microsoft and Big C cooperate to deploy cloud solution

Today, Big C Vietnam and Microsoft officially tightened their mutual relationship and brought it to a higher level via an Enterprise Agreement EA signing ceremony.

According to the EA, Big C would be the first retailer in Vietnam to deploy Microsoft’s Office 365 cloud solution into the retail market in order to further enhance its customer service quality in all its stores through productivity boost, operational expenditure optimisation, and ensuring the safety and privacy at the highest as well.

As one of the international professional retailers has relentlessly developed over the past 16 years, Big C has opened and operates 30 commercial centers and hypermarkets in 20 cities and provinces in Vietnam so far, with its human resources of more than 9,000 staff, annually serving over 40 million customer visits.

“For customers’ satisfaction is Big C’s objective for endeavor and development. Hence, apart from offering customers wide range of diversified goods with best price and controlled quality, Big C also focuses on seamless improvement in its service quality in order to bring the most enjoyable shopping experience for local customers making Big C to be every household’s favorite shopping destination,” James Scott, CEO of Big C Vietnam said. “Advanced IT applications in operations management is one of Big C’s strategic solutions for its sustainable development. The cloud solution is one of the pioneer decisions in retail industry in Vietnam. We believe that, together with Microsoft’s, Big C will continuously develop and self-improve to offer more added benefits for local customers.”  

Owning features used by 60 per cent of the world’s largest enterprises in the Fortune 500 over the past year, Office 365 is the IT solution for highest-growth-rate enterprises in Microsoft history. Apart from that, Microsoft Office 365 was also honored to be interesting, attractive, and the most trustworthy cloud service by global media. Comprised full suite of office productivity applications from Microsoft Office to such integrated communications and collaboration tools as Exchange Online, SharePoint Online, OneDrive for Business, and Yammer, ensuring 99.9 per cent uptime, Office 365 is considered a perfect office solution for those enterprises that want to increase business and staff productivity.

Being approached in new way, integrated with cloud computing through breakthrough innovative applications that become smarter, more solid, Microsoft Office 365 delivers ‘touch-optimised’ technology, which enables users to easily manipulate on such touch devices as tablet, smartphone from anywhere, on most available devices.

Besides, in efforts to serve global users accessing modern services, quality add-ons to get the highest productivity, recently, Office 365 subscribers are offered 1TB storage on OneDrive. The huge storage helps ensure business officers to work where and when they want with productivity and advantage like office devices with all data on cloud in real-time.

“Always counsel to deploy the most optimal platforms, solutions and services for enterprises, and collaborate with users is Microsoft’s commitment,” said Vu Minh Tri, general director of Microsoft Vietnam. “In companion with the latest trend, mobile-first, cloud-first in particular, the cooperation between Microsoft and Big C in Vietnam is a crucial pace to enhance cloud service effectiveness in Big C operations. It is well-assured that Office 365 will improve the productivity on account of the familiar interface, identicalness on all devices, which allows the management board as well as the staff to be flexible to work and operate the business.”

Building sector tries to go green

Vietnamese officials and international donors on Monday held a roundtable meeting on growth in green construction in the capital.

Participants heard that the sector reportedly consumes 36 per cent of the nation's total electricity usage.

The implementation of green initiatives could conserve up to 30-40 per cent of its current demands.

Jesper Dilefsen, an advisor from the Danish Energy Agency, told online newspaper Vietnamplus that Viet Nam should employ sustainable methods in existing and future buildings as soon as possible.

Other sponsors voiced opinions on the prioritisation of energy-saving programmes such as building capacity for the technical system, designing eco-friendly products and enacting relevant measures and regulations.

They advised the construction ministry to take part in long-term and multi-sector projects rather than limiting itself to activities within its field.

According to Phan Thi My Linh, Deputy Minister of Construction, the roundtable meeting provides a practical discussion platform between her agency and foreign partners, which contributes to improving green development policies.

The sea level is expected to rise by 98 centimetres by the end of the 21st century, flooding 20 per cent of HCM City 's surface area and directly affecting 10 per cent of the Vietnamese population. These impacts are predicted to reduce the national GDP by 10 per cent.

The Ministries of Industries and Trade and Finance set new caps for retail petrol prices yesterday, urging domestic dealers to enforce them from 3pm onwards.

The authorities said in a news release that the maximum prices have been fixed at VND15,686 (US$0.75) per litre for RON 92 gasoline and VND15,183 ($0.72) per litre for 0.05S diesel, based on the global petrol price developments over the last fortnight.

They also stipulated limits of VND15,623 ($0.74) per litre for kerosene, VND11,861 ($0.56) per kilogramme for 180CST 3.5S mazut, and VND15,356 ($0.73) per litre for biofuel E5 gasoline.

The Viet Nam National Petroleum Group (Petrolimex) announced that it has made adjustments in time, slashing the price for a litre of E5 by VND320 to VND15,350. The prices of other products will remain unchanged, it added.

Domestically, the base price for diesel has slid 0.1 per cent during the last fortnight, while the base prices have risen 3.3 per cent for gasoline, 2 per cent for kerosene and 5 per cent for mazut, according to the ministries.

The base price is typically calculated, based on the import prices plus taxes, costs and profit quotas for fuel dealers.

The authorities have also allocated new quotas for enterprises by establishing price stabilisation funds on February 5. Dealers must now extract VND340 per litre for gasoline, VND520 per litre for kerosene and VND270 per litre for mazut for the stabilisation reserves, or all for VND800.

They are to extract VND820 per litre for diesel, or 20 dong higher than the previous level.

Retail prices for petrol have been cut twice this year in the context of global oil prices experiencing continuing declines.

VAFI proposes interest rate cut

The Viet Nam Association of Financial Investors (VAFI) has asked the State Bank of Viet Nam (SBV) and the Ministry of Finance (MoF) to cut dong interest rates on institutional deposits to about 1 per cent from the current 6-6.5 per cent per annum.

In its document sent to SBV and MoF, the VAFI said that such a dramatic cut required great determination and concerted measures from the SBV and the MoF but would have a clear impact on the country's economic development, Vietnam Economic Times reported.  

The VAFI also said the central bank should drastically restructure the commercial banking system, which required dissolving ailing commercial banks, leaving only 15. Foreign banks should also be encouraged to purchase ailing financial institutions.

According to the association, Viet Nam's State Capital Investment Corporation (SCIC) should control a majority of shares in local banks such as BIDV, Vietinbank, Vietcombank,and MHB. This would save the central bank from getting too involved in their business performance or becoming a judge in its own affairs, as the central bank's function was managing currency and banking operations.

The VAFI also said the central bank should not appoint directors who had never worked for a business and did not have any achievements in business management. Additionally, they should not be appointed to boards of directors or jobs as general directors or CEOs at finance institutes managed by the SBV.

The association urged the MoF to control land prices to ensure healthy development of the property market and the State to enact an Assets Law to avoid price fever. If the interest rate for deposit in Vietnamese dong was lower, people might pour their idle money into the real estate sector, causing high land fever and bringing inflation, production and business to a standstill, the association warned.

To cut the dong deposit interest rate, the Ministry of Finance also needed to spur the development of the securities and bond markets. Lower interest rates would stimulate the recovery and development of these markets and the banking industry would be able to mobilise long-term deposits.

In addition, the State should open more room for foreign investors to invest in listed stocks, VAFI said. The Ministry also needed to outline a roadmap to minimise the budget deficit and public debt and balance the State budget and spending in the next 10 years.

Some analysts doubt the feasibility of the proposal. Can Van Luc, head of BIDV's human resources training school, said it would be too difficult to lower the deposit interest rate to 1 per cent for several reasons.

First, inflation was now low due to the impact of the decreased oil price. Second, the deposit interest rate needed to be kept at an attractive level to attract depositors so people would keep depositing at banks. Before reducing the deposit interest rate, inflation movements in the next few months needed to be observed, he said.

Former State Bank governor Cao Sy Kiem said the interest rate needed to be reduced, but the level needed to be carefully considered. If the interest rate was too low, commercial banks would suffer liquidity pressure as people rushed to withdraw their deposits from banks and invest in other financial channels such as property and securities.

Another banking expert said that the VAFI's proposal should be reconsidered after five to 10 years, when the inflation and finance market was stable as in many countries in Europe or the US.

Given the current domestic unstable finance market, bringing the interest rate for deposits down to 1 per cent was "unbelievable", he said.

Sai Gon Trading Group (Satra) opened its first Satrafoods food store in suburban HCM City – in Cu Chi District's Phuoc Vinh An Commune – raising the total number of its outlets to 52.

It stocks more than 2,000 items, of which over 80 per cent is fresh and processed food, vegetables, and household appliances.

The store also sells nine priced-stabilised essential items like rice, sugar, and cooking oil.

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.

To mark the opening, the store is offering a discount of 49 per cent on many items until February 14.

Vietnam improves its currency's competitiveness

The Economist Intelligence Unit has analyzed Vietnam’s recent adjustment of exchange rate by 1% against the US dollar.

It hailed the State Bank of Vietnam (SBV)'s active response to the international monetary market to improve the domestic currency’s competitiveness.

Vietnam continued to enjoy positive growth in export revenue of 12% recently while trade deficit was no longer a problem.

The EIU considered the foreign exchange adjustment a proactive step, rather than a shock therapy to restore economic growth.

HAPRO unveils tentative plans to invest in Angola

Representatives from the Hanoi Trade Corporation (HAPRO) recently paid a working visit to Angola where they met with governmental and industry leaders from import-export enterprises discussing potential investments in the South African country.

The representatives discussed in detail the potentiality of investing in the wood and food processing sectors with the mayors of Luanda and Benguela provinces. In addition, they talked about opportunities in the seafood processing and aquaculture fields.

For their part, representatives from the Angola National Private Investment Agency (ANIP) were most receptive to HAPRO’s interest in the country, especially in the fields which would generate jobs, accelerate technological transfer and help Angola fully tap its production potential.

The mayors of Luanda and Benguela provinces in turn suggested measures to speed up the investment process and asked HAPRO to send a delegation to survey particular construction sites so that negotiations for their purchase could get underway expeditiously.

Ha Noi to display popular foods at Spring Fair 2015

A ten-day fair showcasing food and fruit specialties from across the nation will begin tomorrow at Giang Vo Exhibition and Fair Centre in Ha Noi.

The annual exhibition provides an opportunity for businesses to promote trade activities and better serve purchasing demands prior to the Lunar New Year (Tet), the largest holiday in Viet Nam, they said, adding that more than 500 businesses will participate in the exhibition.

Nguyen Kim sells stake to Thailand's Central Group

Thailand's Central Group became a strategic partner of electronics retailer Nguyen Kim Trading Joint Stock Company, purchasing a 49 per cent stake for an undisclosed sum under a contract signed on Monday.

Nguyen Kim seeks to develop into a strong electronics retailer in the proposed ASEAN common market, with a range of initiatives geared towards strengthening its market position and improving its digital marketing strategy.

Among its plans are to offer new lifestyle shopping centres and product categories beyond electronics.

Nguyen Kim is looking to expand from its current 21 stores to more than 50 across the nation in 2019 to retain its market leadership. Digital marketing is set to play a key role in the plan, with the company hoping to increase online sales by 50 per cent in 2015.

Footwear sector takes steps into New Year

A successful 2014 and the promise of bigger export opportunities has given the domestic leather and footwear industry the confidence to set a US$14 billion export target for this year.

Phan Thi Thanh Xuan, general secretary of the Viet Nam Leather and Footwear Association (Lefaso), told Viet Nam News that the new target marked a year-on-year increase of 15 per cent.

She said last year was a successful year for the industry, with its presence in 47 global markets seeing the total leather, footwear and handbags exports rise 22.5 per cent over 2013 to $12.74 billion, accounting for 8.5 per cent of the nation's total export turnover.

Impending Free Trade Agreements (FTAs) and the Trans-Pacific Partnership (TPP) will attract new investments into Viet Nam's leather and footwear industry, she said.

"We think the agreements will create remarkable growth in export turnover in the coming years," Xuan said, explaining that the ensuing reduction in tariff barriers would make it easier for Viet Nam to export to large markets.

When the TPP comes into effect, the current taxes of 3.5 to 57.4 per cent would be slashed to zero per cent, which would support exporters looking to expand production and make better products, experts said.

However, in upcoming years, the sector might have to face stiff competition from India, the second biggest footwear producer in the world, Xuan said.

India has the advantage of having lower wages and production costs than Viet Nam, and the Indian government has issued new preferential policies for foreign investors.

Other experts have also pointed out that when the market opens, foreign footwear makers will utilise Viet Nam's preferential tax policies. If domestic firms do not respond quickly, opportunities will be lost and market shares reduced, they have warned.

The US market, which was Viet Nam's largest footwear importer last year, will set up more non-tariff barriers, mainly on product safety standards, aiming to protect its own sector when the TPP is signed, the Thoi bao Kinh te Viet Nam (Vietnam Economic News) quoted Nguyen Hong Duong, deputy director of the American Market Department under the Ministry of Industry and Trade (MoIT), as saying.

Duong advised firms to continuously update themselves on policies and market information so that they can protect themselves better. They should express their concerns through Lefaso to the Government and seek solutions, he said.

Leather and footwear exports last year saw a year-on-year growth in most of its markets. The US ranked first with imports of $3.3 billion, up 26.71 per cent over 2013. It was followed by Belgium with $659 million, up 27.68 per cent, and Germany with $600 million, up 31.19 per cent.

Xuan attributed the growth to many leading footwear brands shifting orders from China and Bangladesh to Viet Nam in recent years, enhancement of the country's production capacity and its competitiveness capacity, and increasing foreign investment in the sector.

Viet Nam, Japan lift industrial co-operation

The Deputy Prime Minister has urged relevant ministries and agencies to rapidly implement the Viet Nam Industrialisation Strategy (VIS), which is part of the Viet Nam-Japan cooperation framework through 2020.

Deputy PM Hoang Trung Hai has given the directive to the following ministries: Finance; Science and Technology; Labour, Invalids, and Social Affairs; Foreign Affairs; Education and Training; Natural Resources and Environment; Construction; Industry and Trade; Agriculture and Rural Development; Planning and Investment; and Transportation, as well as the State Bank of Viet Nam.

They have been asked to carry out their assigned tasks in a timely fashion, including submitting reports to the Deputy PM – who also heads the Steering Committee for VIS – by April this year.

Under the strategy approved by the Prime Minister on July 1, 2013, priority has to be given to developing the electronics, agricultural machinery, agricultural and seafood processing, ship building, environment and energy saving, and automobile and spare parts manufacturing sectors.

The development of these industries is expected to nurture high value-added products, boost technological innovation and productivity, and improve global competitiveness of local firms.

The Ministry of Planning and Investment was assigned to supervise progress in the implementation of the action plan and conduct research on potential products or areas for cooperation with Japan.

Additionally, it will collaborate with the Ministries of Foreign Affairs and Finance to seek support from foreign partners and enterprises for the projects stipulated within the plan.

Meanwhile, the Ministry of Industry and Trade will work with the Japanese Embassy to finalise an action plan for the development of the automobile and spare parts manufacturing industry in March 2015.

VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR