Thailand’s KBank opens two branches in Vietnam
Thailand's Kasikornbank (KBank) has opened two representative offices in Hanoi and HCM City to support trade and investment expansion of Thai companies in the country.
Through KBank's partnerships with leading local banks, market insights and business networks connecting Thai businesses with corporations in Vietnam and other ASEAN countries will also be offered.
According to KBank President Predee Daochai, Vietnam is one of the most important investment destinations for Thai and foreign investors, given the country's ample labour force that is diligent, patient, and has a positive attitude towards self-development.
While Vietnam is a great source of raw material, the country is also home to more than 90 million consumers, and is a high-growth potential market, he added.-
Finnish firms seek opportunities in Ho Chi Minh City
A business delegation from the South Ostrobothnia region of Finland is exploring cooperation opportunities in Ho Chi Minh City in agriculture and food hygiene and safety.
The ongoing visit is to seek Vietnamese partners eligible in the fields to join the Finnish renovation programme in Vietnam, said Asko Peltola, South Ostrobothnia Mayor, while meeting with Chairman of the municipal People’s Committee Le Hoang Quan on March 5.
It is also hoped to spur the trade partnership between Ho Chi Minh City and Finnish localities in the coming time, Quan told the guests.
Ho Chi Minh City will maximise its efforts to nurture the sound traditional friendship and cooperation between Vietnam and Finland , which are positively developing, Quan said.
He recounted a wide range of activities in 2013 – the year marking the 40th anniversary of the bilateral diplomatic ties, such as Finland’s poster exhibition and workshops on education and trade cooperation.
The bilateral trade between Ho Chi Minh City and Finland hit 94.4 million USD in 2014.
Finland is running three investment projects worth 1.65 million USD in the city.
Seminar focuses on trade with Japanese province
A seminar to promote trade with Japan's Wakayama prefecture is scheduled to be held in Hanoi on March 12.
At the workshop, which will be organised by the Vietnam Chamber of Commerce and Industry (VCCI), representatives from five Japanese businesses operating in the fields of food, agricultural products, T-shaped screw and nut production and the manufacture of dry cleaning machines, will brief participants about their plans to do business in Vietnam.
The governor of Wakayama, which is famous for several industries, such as agriculture, steel industry and petrochemicals, will speak on the potential and development efforts of the prefecture at the event.
This will be a good opportunity for Vietnamese businesses to meet and exchange information, as well as seek partnership with Japanese enterprises.-
Vice State President meets with exemplary businesswomen
Vice State President Nguyen Thi Doan had a meeting with outstanding female entrepreneurs who have pioneered in international economic integration in Hanoi on March 5 on the occasion of the 105th International Women’s Day (March 8, 1910).
Vietnam is currently home to more than 500,000 businesses, over 100,000 of which are owned or directly run by women.
The Vice President noted that the ASEAN Community is set to be established in 2015, facilitating Vietnam’s comprehensive integration into the international community and opening the door to the world’s scientific and technological achievements and global companies. Therefore, Vietnamese entrepreneurs, especially businesswomen, should prepare for this changing playing field.
Underlining challenges in the integration period, Doan asked them to uphold Vietnam’s business culture and improve their foreign language and communication skills, professional competence, and administration capacity.
She also said entrepreneurs need to take heed of scientific research to minimise unnecessary operational expenses while speaking highly of their contributions to ensuring social welfare.
Noting that the State continually looks to create optimal conditions for businesses and entrepreneurs, the Vice President wished great success for the businesswomen and encouraged them to contribute to the nation during its integration.
Binh Duong FDI attraction hits 180 mln USD over two months
The southern province of Binh Duong attracted nearly 180 million USD in foreign direct investment (FDI) from 20 new and 16 expanded projects in the first two months of this year.
According to the provincial Department of Statistics, most of the FDI capital was poured into industrial production during the reviewed period.
Omexay Industrial Rubber JSC and Chen Ho Textiles CO., Ltd of Taiwan (China) invested 20 million USD and 12.5 million USD, respectively in building rubber and fibre production plants in the locality.
Other businesses added their capital to beer, solid tire and plastic production projects.
Binh Duong has thus far lured 2,412 foreign-invested projects with a total registered capital of nearly 20.66 billion USD, including 1,404 worth nearly 12.53 billion USD operating in industrial parks.
Among 39 countries and territories investing in the province, Japan has contributed the largest amount of capital with nearly 4.74 billion USD.
It is followed by Taiwan with 4.65 billion USD; the Republic of Korea with 1.92 billion USD and Singapore with 1.77 billion USD.
Interior design exhibition to be held in HCM City
The Vietnam International Furniture and Home Accessories Fair will return to Ho Chi Minh City next week, offering industry professionals opportunities to network and compare notes.
VIFA-EXPO 2015, the eighth edition of the event, will feature more than 900 booths of 177 domestic and foreign exhibitors, an increase of 42 percent and 25 percent, respectively, over the preceding expo, said Huynh Van Hanh, deputy chairman of the Handicrafts and Wood Industry Association of HCM City (HAWA).
The increase in exhibitors reflects the strong interest of furniture firms for new export opportunities, Hanh said at a press conference held in HCM City on March 4.
The fair will display a wide range of indoor and outdoor furniture, handicrafts, interior furnishing and accessories, machinery and support services.
Seminars to be held at the fair will feature topics on improving the quality of human-resource training in the wood-processing industry, and opportunities and challenges in exporting wood products to the US.
Hanh said 686 customers from 66 countries and territories as of March 3 had registered to visit the fair, which will be held at the Sai Gon Exhibition and Convention Centre in District 7 from March 11 to 14 by the HCM City Department of Industry and Trade and HAWA.
Last year, Vietnam earned 6.23 billion USD from exports of wood and wood products, up 11.5 percent over the previous year, Hanh said, adding that exports to key markets such as the US, Japan and EU rose strongly in the period.
Central bank urged to continue flexible monetary policy
The State Bank of Vietnam (SBV) has been requested to continue implementing flexible monetary policies in close association with fiscal policy in order to ensure macro-economic stability, support production development, and boost economic growth.
The SBV was also requested to prioritise promoting production and business and accelerate the restructuring of the system of credit organisations to keep the rate of bad debt below 3 percent by the end of 2015.
The central bank will work with ministries to design investment proposals for developing the transport network.
Meanwhile, the Ministry of Planning and Investment will collaborate with ministries and localities to effectively implement the Law on Public Investment by strengthening the involvement of various resources in the socio-economic development.
The Ministry of Finance will take drastic measures to manage the prices of essential goods and services as the Ministry of Industry and Trade focuses on promoting trade, expanding markets, and boosting exports to raise export value.
The Ministry of Industry and Trade will also work with ministries and localities to develop the bio fuel E5 distribution network and protect consumer rights.
The Ministry of Transport will push the implementation of key transport initiatives in tandem with ensuring transportation safety, especially at festivals.
PM approves special mechanism for Nhat Tan – Noi Bai route
Prime Minister Nguyen Tan Dung has given a nod to a proposal on issuing special mechanisms for urban development along Nhat Tan – Noi Bai route, a newly-constructed landmark transportation route in Hanoi.
The 11.7 kilometre stretch sprawls over 2,000 hectares and requires 33 trillion VND for site clearance, expected to be concluded by 2025.
A highlight of the project will be the Phuong Trach financial skyscraper with up to 108 floors.
During a meeting with the municipal authorities on March 5, the PM asked for the establishment of an urban development management board to oversee the efforts.
The State would reclaim land and offer compensation for displaced residents living in the area, he said, adding that ministries and agencies must work with Hanoi authorities to classify urban projects according to official development assistance and local budget limitations.
Cabinet members asked the capital city to step up progress of the master plan for the route and attract additional public-private partnership investment along the way.
In his address, Chairman of the municipal People’s Committee Nguyen The Thao reported that Hanoi ’s economy expanded by 8.8 percent in 2014, 1.52 times the nation’s average. This year, the city targets a 9-9.5 percent growth.
The authorities suggested the Government approve the allocation of 45 percent of Hanoi ’s gross domestic product, up from the current 42 percent, for socio-economic development
They also proposed establishing a Department of Tourism, which was approved.
VINACOMIN earns 15.7 trillion VND in first two months
The Vietnam National Coal and Mineral Industries Group (VINACOMIN) reported a total revenue of 15.7 trillion VND in the first two months of 2015.
During the period, the group produced 6.4 million tonnes of rough coal, equivalent to 15.7 percent of the annual targets and sold 4.8 million tonnes of coal reaching 12.7 percent of targets.
In addition, the group produced 7,380 tonnes of copper ore, 28,000 tonnes of iron ore , 1,400 tonnes of copper plates; 63,400 tonnes of aluminium, and produced and consumed 1.323 billion kilowatts of electricity.
The Group aims to produce 40.8 tonnes of coal this year, with consumption of 38 million tonnes. Of the sum, coal exports will amount to 3 million tonnes, while 35 million tonnes will be for domestic consumption.
It also aims to earn more than 114 trillion VND (5.3 billion USD) in revenue.
Denmark becomes a potential trade partner of Vietnam
With numerous cooperation agreements signed with Vietnam, Denmark is quickly becoming a potential trade and investment partner of the Southeast Asian nation, paving the way for enterprises to promote export revenue, said the Ministry of Industry and Trade.
The Ministry said that Denmark has been implementing trade liberalisation policies to create favourable conditions for foreign enterprises to penetrate its market.
Notably, Denmark is coordinating with Vietnam to carry out a project to study and promote trade connections in agriculture and aquaculture. The project aims to identify and assess the value chain of ‘tra’ fish, domestic fowls, tea and potatoes in the northern mountainous areas, Red River Delta, Southeast region and Mekong Delta.
Additionally, the project also supports farmers to establish a sustainable supply chain, presenting Vietnamese agricultural products with valuable opportunities to gain market shares in Denmark and other European countries.
Looking forward, Danish enterprises plan to visit Vietnam to seek partners in agriculture and food and uncover additional cooperation opportunities for the two sides.
According to statistics from the Ministry, trade between Vietnam and Denmark raked in 479 million USD in 2014, providing Vietnam with a total export revenue of 303 million USD, an annual increase of 13.2 percent, from its key exports: garments, footwear, wooden furniture and electricity appliances.
In a bid to increase exports to Denmark, Vietnamese enterprises are advised to improve their international trade knowledge and renew business strategies while focusing on high-quality products and investing in brand names.Project to train commercial bank directors approved
The Prime Minister has given his approval for a project to train directors of commercial bank branches from 2015 to 2017, funded by Official Development Assistance (ODA) from the Swiss government.
The project aims to improve management of Vietnamese commercial banks in line with international regulations through enhancing the capacity of managerial personnel.
Managed by the State Bank of Vietnam (SBV), the project will require 2.9 million USD, 2.5 million USD of which constitutes non-refundable capital.
The Prime Minister asked the SBV to finalise preparations and carry out the project in accordance with Government Decree 38/2013/ND-CP regulating the management and usage of ODA and foreign preferential loans to ensure efficiency.
Science-technology fuels Vietnamese coffee’s growth
The development of science-technology in coffee cultivation through contributions from the Central Highlands Agriculture and Forestry Science Institute (CASI) has helped Vietnam establish itself as the world’s second largest coffee producer and top Robusta coffee exporter.
CASI Director Dr Le Ngoc Bau said after 1975, when Southern Vietnam was liberated and the country was reunified, the Central Highlands had only 12,000 hectares of coffee trees with several hundreds of kilograms of beans per hectare.
The region is now home to more than 90 percent of Vietnam’s 635,000 hectares of coffee trees which generate 2.3-2.5 tonnes of beans every hectare and more than 1.5 million tonnes of beans every crop; a productivity that is currently 2.5-3 times higher than the global average, he added.
In 2014, Vietnam exported more than 1.7 million tonnes of coffee beans worth over 3.4 billion USD, ranking second in terms of export value after rice.
Bau said over the past decade, the CASI has focused its resources on researching key cultivation methods for seedling production, growing techniques, and low-yield tree improvement.
Between 2000 and 2010, the institute successfully created nine Robusta varieties, from TR4 to TR13, by cross-breeding and two Arabica varieties, TN1 and TN2. All of which were recognised by the Ministry of Agriculture and Rural Development, he noted.
The new Robusta varieties generate about 4.5-7.3 tonnes of beans per hectare every crop, 30 percent more productive than traditional varieties, with bigger beans (17-23 grams every 100 beans). Most importantly, they are highly capable of resisting the leaf rust (Hemileia vastatrix), a disease that can cause serious damage to coffee trees.
These varieties have been provided for local farmers to replace old ones, the Director added.
The CASI has also developed and instructed the use of effective watering and fertilising methods, techniques for other cultivation steps, and harvesting and processing technologies to farmers.
In the years ahead, his institute will continue developing high-yield and high-quality varieties and more effective growing techniques while conducting in-depth studies on coffee diseases and pests to help Vietnam’s coffee sector develop sustainably, Bau noted.-Lotte, Japanese partners to develop Eco Smart City
The Republic of Korean conglomerate Lotte will join hands with two Japanese groups to develop a multibillion-dollar real estate complex in Ho Chi Minh City.
The Eco Smart City will be built in the new urban area of Thu Thiem in District 2, Lotte chairman Shin Dong Bin said during a reception hosted by the city’s chairman, Le Hoang Quan, on March 4.
Japanese firms Mitsubishi and Toshiba will partner with the RoK food and shopping corporation in the megaproject, Shin added.
The US$2 billion development is expected to feature luxury trade centers, hotels, office buildings, and apartments on a 10-hectare land plot.
The developers aim to make Eco Smart City a modern, deluxe center of finance, commerce, and service, and an iconic architecture construction of the southern Vietnamese metropolis.
The project will be one of Lotte’s biggest overseas investments, according to chairman Shin.
Chairman Quan said the municipal administration is interested in the project and encourages the developers to complete the necessary paperwork soon to get its work started.
The chairman also suggested that the best time to break ground on the project is in September, when Vietnam celebrates the 70th anniversary of its independence.
Lotte and its Japanese partners received in-principle approval for the project from the city’s administration in April last year, according to The Saigon Times Online.
A Lotte representative said they had been pursuing the project for years before getting the approval.
Foreign investors frown on weak supporting industries
Weak supporting industries and a lack of skilled labor are among the major barriers to foreign investment capital flow in the city, according to representatives of foreign-invested companies.
At a meeting with leaders of HCMC on March 4, foreign investors called for the city to quickly resolve the two problems to support them to improve competitiveness at a time when Vietnam is deepening its integration in the world.
They complained they had made great effort to increase local content in their products to strengthen their competitiveness but to no avail.
Yutaka Watanabe, general director of Japan’s Towa Industry Co., Ltd. in Tan Thuan Export Processing Zone in District 7, said the company has been operational in Vietnam for 20 years but it has had difficulty finding local material suppliers, making its products less competitive.
With its billion-dollar facility to assemble and test chips at Saigon Hi-Tech Park in HCMC, Intel Products Vietnam is also facing the same problem.
Sherry Boger, general manager of Intel Products Vietnam, underscored an urgent need to develop local supply and high tech industries, saying her company could support Vietnam in this area.
Boger suggested the Vietnamese Government weigh establishing industrial clusters with attractive incentives to lure new investors who can supply materials and products at low prices but of good quality and high technology.
Yasuzumi Hirotaka, deputy chairman of the Japanese Business Association of HCMC (JBAH), said the localization rate of Japanese firms in Vietnam is only 14%, well below the 20%-plus of Japanese firms in Thailand and much lower than in other countries.
If the Government does not support small and medium enterprises enough, Vietnam cannot compete with other countries in terms of supporting industries, Hirotaka said.
Regarding low-quality manpower, Ngo Duc Chi, general director of Global Cybersoft Vietnam, said the lack of high quality manpower in the information technology (IT) field had caused his company to lose many business opportunities.
Chi said the potential for the IT market is huge but the shortage of human resources in the sector has made life tough for the company and triggered fiercer competition among firms in the sector in search for talent.
The meeting was attended by 200 representatives from 12 foreign business associations and foreign enterprises operating in the city.
Husbandry industry fares well on stable selling prices
Husbandry households and businesses could earn profits last year owing to stable selling prices and input materials after two years of losses.
Husbandry farms posted profits of 5-30%, according to the latest data of the Vietnam National Animal Husbandry Association.
Nguyen Van Lam, the owner of a farm with over 500 pigs in Quoc Oai District, Hanoi, said 2014 was a successful year when the selling price averaged out at VND43,000-44,000 per kilogram and briefly rose to VND49,000-50,000 a kilogram.
“With more than 500 pigs, we gained profit of hundreds of millions dong,” Lam said.
Another farmer in the capital city told the Daily that his family suffered big losses in 2012-2013 due to falling prices and diseases. However, things changed last year when the profit from pig and chicken breeding last year helped him settle all debts and still earned nearly VND400 million profit.
Husbandry companies also benefited much from the growing meat processing market last year. For example, Austfeed Vietnam Co. Ltd. with more than 80,000 pigs raised in northern provinces obtained revenue of VND1.5 trillion in 2014, and its profit surged 35% year-on-year.
David John Whitehead, chairman of Austfeed Vietnam, said that pig, cow and poultry farms could gain high profits as prices of both input materials and meat were stable last year.
Nguyen Dang Vang, chairman of the association, confirmed that the industry fared well last year. He quoted statistics from the Ministry of Agricultural and Rural Development as saying that the prices of meat, milk and eggs stayed high in 2014 despite their outputs were up 2.7%, 15.6% and 3.8% respectively.
Vang said besides improvements in the quality of animal feed and breeders, more farms, cooperatives and enterprises joined forces to establish production chains in different localities, including Hanoi, Ha Nam, Bac Giang, HCMC and Dong Nai to better control food hygiene and safety.
Wind farm investors want power prices raised
Investors of wind power projects want the Government to increase the price of electricity generated by their projects as the current low price discourages investments in this source of renewable energy.
Speaking to the Daily last Friday, Pham Dong, director of Ninh Thuan Province’s Department of Planning and Investment, said as wind park projects require huge capital, investors could not secure profitability if they sell electricity at low prices. This is the reason why investors are hesitant to accelerate the progress of their projects.
There are three operational wind farms nationwide with a combined capacity of 54 MW. They include Binh Thanh and Phu Quy in the central province of Binh Thuan and Bac Lieu in the Mekong Delta province of Bac Lieu.
Investors have registered to implement more than 45 wind power projects with a total capacity of 4,822 MW across the country.
According to Bui Van Thinh, vice chairman of the Binh Thuan Wind Energy Association, the Government’s Decision 37/2011/QD-TTg set the wind power price at 7.8 U.S. cents per kWh to encourage investment in wind power projects, but this level is not attractive enough.
The price is below the 8.5 U.S. cents per kWh in Taiwan, the 9.5 U.S. cents in South Korea, 8.5-10 U.S. cents in China, 12 U.S. cents in Spain, 12.3 U.S. cents in Germany, 14 U.S. cents in the Philippines, 20 U.S. cents in Thailand, and 29 U.S. cents in Japan.
The association has recently proposed the Government and relevant agencies mull a road map to increase the price of electricity supplied by wind farm projects to 10 U.S. cents per kWh this year and more than 12 cent per kWh in 2017.
Pham Trong Thuc, head of renewable energy at the General Department of Energy, told the Daily that the Ministry of Industry and Trade is expected to present to the Government a plan this month to adjust up the wind power price.
However, while investors are waiting for the Government to consider a price increase, they are worried about the punitive measures which local authorities might take against delays in their projects.
Leaders of Binh Thuan and Ninh Thuan provinces, which hold huge potential for wind power generation, have recently urged investors to fasten the pace of their projects.
Ninh Thuan Province has revoked the license of Phuoc Dan project in Ninh Phuoc District. This 50-MW project worth nearly VND1.3 trillion was licensed in late 2008 but has yet to get off the ground.
Thinh of the Binh Thuan Wind Energy Association said the province may also cancel some delayed projects out of the 17 wind power projects already registered by investors.
Under the master renewable energy development plan approved by the Government, Vietnam will have a total wind power capacity of 1,000 MW by 2020 and 6,200 MW by 2030.
Auto imports drop 50% in Tet month
The number of completely built-up (CBU) autos shipped into Vietnam in February, in which Vietnam celebrated the Lunar New Year (Tet), declined 50% against January to 5,000 units, according to the General Statistics Office (GSO).
However, data of GSO showed that CBU imports last month surged 65% year-on-year, suggesting that demand for imported cars is strong on the local market.
The country spent around US$130 million importing 5,000 CBU units in February, or US$56 million lower than the first month of 2015, but US$82 million higher than February last year.
In the first two months of this year, Vietnam imported around 15,000 CBU autos valued at some US$316 million, year-on-year rises of 140% in number and 170% in value. Therefore, industry sources said the decline in imports in February was nothing abnormal given the long Tet holiday.
More CBU autos will be imported into Vietnam as auto assembly joint ventures tend to shift to car imports for domestic sale.
The country will cut tariffs on CBU autos imported from ASEAN to 0% in 2018 in line with the ASEAN Trade in Goods Agreement (ATIGA).
Auto sales reached 157,800 units last year, soaring 43% against 2013 with CBU autos accounting for around 72,000, or 45% of the market, according to the Vietnam Automobile Manufacturers Association (VAMA).
Gov’t: Consumption stronger in Jan-Feb
The nation saw improvements in almost socio-economic sectors with consumption rising strongly in the first two months of this year, heard at a meeting in Hanoi on March 2.
Prime Minister Nguyen Tan Dung told the meeting that these are positive signs for the Government to reach the economic targets set for this year.
At the meeting, cabinet members heard and discussed reports on the country’s socio-economic performance in the first two months and cabinet members’ feedback on the Government’s draft resolution on measures to improve the business environment and national competitiveness this year.
Minister of Planning and Investment Bui Quang Vinh said the steady drop of the consumer price index (CPI) was the result of falling fuel prices in Vietnam and on global markets. And this has led prices in traffic, housing and building material groups to decline.
Manufacturing in the country was positive in the first two months and total retail revenues from goods and services were up. Excluding price factors, sales increased by 10.7% in February versus 6.2% and 3.6% in the same period of 2014 and 2013 respectively.
Vu Viet Ngoan, chairman of the National Financial Supervisory Commission, said that inflation is now at a level that is conductive to economic growth.
According to the commission, inflation rose 2.4% year-on-year. For a gross domestic product (GDP) growth rate of 7-7.5%, inflation at 3-3.5% is the most reasonable.
Besides, investor and consumer confidence has risen to a four-year high, making it possible for the economy to grow further this year, Ngoan said.
A report by the Government indicated the nation’s basic inflation over the past two months edged up 2.4% while the Index of Industrial Production (IIP) jumped 12% against the same period in 2014. Foreign direct investment (FDI) disbursements reached US$1.2 billion.
Dung also requested ministries and local authorities to deal with current difficulties and create favorable conditions for enterprises. They were told to maintain macroeconomic stability while considering more interest rate cuts to inject more money into the economy.
Besides, he stressed that fuel and electricity prices should be decided by market forces. Healthcare service prices must be kept at reasonable levels and be made transparent to support needy people and ensure social welfare.
Experts: No deflation in sight
Although the consumer price index (CPI) in HCMC has dropped since November last year, economic experts said this is not a worrying sign as the local economy does not face deflation risk.
According to the HCMC Statistics Office, the city’s CPI in February, the month of the Lunar New Year holiday (Tet) characterized by a spending spree, went down 0.4% against January for the first time in the last six years due to falling prices of fuels and other goods. Consumer prices did not increase at Tet as seen in the previous years thanks to sufficient supply.
In addition, fewer consumers kept the habit of storing food for the biggest holiday of the year, which ended last week.
The office said February’s CPI in big cities like HCMC and Hanoi shrank against January, pushing the country’s CPI down in the month.
Economic expert Ngo Tri Long said the CPI drop for four consecutive months was unusual. The CPI in the Tet month is usually up over the end of the previous year, but it fell this year as lower fuel prices sent prices of other goods down.
On the other hand, demand was quite low as stubborn economic woes led consumers to tighten spending. But Long said deflation was unlikely as the economy is still growing.
He predicted CPI would rise due to the period chosen to calculate the CPI. Moreover, the world’s fuel prices have bounced back and power prices could be adjusted up later this year.
“Data used to calculate the CPI in February was collected until February 15 while the peak time for Tet shopping was from February 16 to 18. Therefore, prices at Tet will reflect the CPI this month,” Long said.
Tran Hoang Ngan, president of the University of Finance and Marketing, shared Long’s view, saying deflation is not in sight as the CPI fall in February did not result from stagnant production or falling aggregate demand.
Ngan said now is the time to ease monetary policy to increase money supply to make it easy for businesses to take out loans to prop up production and turn out competitive products. This is important for local firms to cash in on the new trade pacts Vietnam is expected to sign this year.
Tax incentives for suppliers of supporting industries
Manufacturers of products for supporting industries will enjoy a corporate income tax of 10% for 15 years like enterprises in the hi-tech sector and investors in localities with socio-economic disadvantages.
The Government’s Decree 12/2015/ND-CP clarifies that to enjoy the preferential tax rate, enterprises should have products recognized as items for the hi-tech field as regulated in hi-tech regulations and for apparel, electronics, automobile, and mechanics sectors, and these products had not been manufactured in Vietnam as of January 1 this year.
The Government has introduced the tax policy in an effort to attract investments in supporting industries which are still underdeveloped.
At a conference held in HCMC in October last year to gather comments on the draft decree on developing supporting industries, Truong Thanh Hoai, deputy head of the Heavy Industry Department under the Ministry of Industry and Trade, said the decree would provide small- and medium-sized enterprises (SMEs) with a lot of tax and capital incentives.
According to the industry ministry, although the Government issued Decision 12 on development of supporting industries and Decision 1483 on priority products for the industries, businesses have not benefited from incentives in these decrees.
The Industrial Policy and Strategy Institute under the ministry said Decision 12 disappointed local enterprises as the incentives provided in the decision were the same as those provided for SMEs and did not contain a clear list of priority products.
The corporate income tax of 10% for 15 years will be applied to investors of manufacturing projects worth at least VND12 trillion and capital disbursements within five years from the date of licenses being issued.
HCM City’s public investments to total US$3.4 billion by 2020
HCMC has plans to set aside at least VND73.12 trillion (US$3.4 billion) for public investments between 2016 and 2020 to fuel growth, according to a report on public investments by the city’s government.
The amount does not include nearly VND52 trillion sourced from official development assistance (ODA) funds. In addition, the city expected to mobilize nearly VND106 trillion for the projects to be implemented through the public-private partnership format in the next five years.
The report said the government of HCMC will reserve 15% of the total funding for mid-term public investments to cope with the volatility of the Vietnam dong-U.S. dollar exchange rate and address urgent investment needs, among others.
HCMC has spent around VND98.7 trillion on development investments and ODA disbursements for this purpose have reached VND26 trillion in 2011-2015. Many projects have been put into use and brought significant economic benefits, particularly those in transport, drainage, education and health sectors.
The completed projects include Vo Van Kiet Boulevard, the tunnel under the Saigon River linking districts 1 and 2, Mai Chi Tho, Hoang Sa and Truong Sa streets, Tan Hoa-Lo Gom Canal, and Saigon 2, and Phu Long bridges.
Actually, HCMC needs a hefty VND40 trillion for development investments a year but half of the sum can be arranged due to financial constraints.
To raise funds for public investments in the next five years, the city plans to organize auctions to sell land and assets, better control land use fee collections, attract more ODA and private investments, and issue municipal bonds.
Vietnam Airlines pilots, attendants get wardrobe change
Vietnam Airlines has introduced a wardrobe change for its pilots and flight attendants, with uniforms designed by Minh Hanh.
The move is part of its efforts to become a five-star airline in 2015, as it joins the ranks of leading airlines in Southeast Asia and aims to be the favourite airline in Asia both on the ground and in the air by 2020.
Vietnam Airlines is unrolling a campaign to raise its profile in the region, and the uniform change, from March 3 kick starts that campaign.
“Our former uniforms have been effectively used for over the past 15 years," an airline official said. "The long dress has become a formal and traditional image of Vietnam’s national flag-ship carrier, so we’ve decided to continue to use long dress for flight attendants, but the design is more meticulous and special. All such uniforms are made in Vietnam."
Vietnam Airlines has used US-based Kubo Design Company as a consultant for its uniform designs for many years, and the new design was chosen after a two-year study and rigorous selection process, culminating in the decision to go with renowned local designer Hanh.
Uniforms for male pilots and cabin crew -- featuring white shirts with a lotus motif, the airline logo, and the word “Van” or “Ten Thousand”, a symbol for peace and fortune -- are being made by Duc Giang Garment and May 10, while female staff will be dressed in a design featuring a stylised lotus, symbolising vitality and nobility, made by Tien Tien Farment Co.
Rice exporters worry as competition grows
Vietnam's rice exports have dropped sharply in value after Thailand began dumping surplus grain on the market, China placed restrictions on imports, and India and Myanmar cut their prices.
Market share is being eroded due to cheaper rice from Thailand, which is running down its inventories, with Vietnam having lost 60 percent of its Africa market.
Vietnam has had to cut prices to USD375 and USD350 a tonne, depending on grade, but the Vietnam Food Association (VFA) is optimistic. Prices are now USD30 a tonne lower than Thailand, and Vietnam can regain market share in Africa.
VFA secretary Huynh Minh Hue said exports for early February stood at 270,000 tonnes of rice, down 35 percent for the same time last year, with first quarter exports expected to total 800,000 tonnes.
"This is quite a modest number," Hue said. "Usually, we can export as much as 1.4m tonnes in the first quarter."
Compounding the problem of falling prices is concern about a decline in orders from major customers in China.
In 2014, Vietnam exported 2.1m tonnes of rice to China, accounting for 30 percent of the country's total rice exports. It sold a further 1.5m tonnes in unofficial border trade. But China is cracking down on this unofficial market , one trader saying the border has been closed to rice since July.
China has not yet set a rice import quota. The VFA anticipates China will import 4m tonnes this year, but has already signed a 2m tonne contract with Thailand, and Myanmar is expected to be a supplier.
"Aside from Thailand, the China market will be shared between Vietnam, Myanmar, Pakistan and Cambodia. We'll lose huge market share there, so we need to increase exports to Africa," Hue said.
The Centre for Agrarian System Research and Development said that stockpiling was not an option for Vietnam, as the government does not buy rice directly from farmers but through traders, who would have to lower their offer prices to cover additional costs.
Good news for Hue tourism sector
Central Thua Thien-Hue province welcomed more than 437,900 visitors, including 165,400 inbound travellers and 272,500 domestic tourists in the first two months of this year, a year-on-year increase of 10.8%.
The tourism sector earned VND426.862 billion, a rise of 9.95% against the same period last year.
Diverse cultural activities and festivities helped lure more than 82,000 visitors in the first ten days of the Lunar New Year (Tet) alone, up 30% against the previous Tet’s figure.
Most of foreign visitors came from France, the US, Germany, the UK, Canada, Japan, the Republic of Korea and Thailand.
Particularly, cruise ship Silver Whisper from Bahamas with nearly 700 international tourists on board docked at Chan May port on February 25, signalling a brighter prospect for the provincial tourism sector this year.
Director of the provincial Department of Culture, Sports and Tourism Phan Tien Dung said 38 cruise ships with about 70,000 passengers have registered to dock at Chan May port this year, an increase of nearly 50% over last year.
Dung added that the achievement is attributed to careful preparations and attractive promotion programmes.
Besides, the Department has also organised major events to promote tourism and garner visitors to the province.
In the coming time, Thua Thien - Hue province will conduct more tourism stimulus programmes, actively take part in fairs and festivals at home and abroad, and publish travel guidebooks on local landscape, travel agents and diversify tourism products.