Hanoi looks to develop hi-tech agriculture

Hanoi has devised a number of incentives to encourage hi-tech and sustainable agriculture development.

The city has focused on applying advanced technology in local agricultural production, such as dairy and beef cow raising; vegetable, fruits and flower cultivation; and aquaculture production.

Projects to connect scientists, authorities, enterprises and farmers in developing fruit trees, rice and other crops has also proven effective.

The municipal People’s Committee has approved the application of high technology in producing and preserving flowers for the 10-hectare Tay Tuu flower-growing area.

It has also approved a number of hi-tech agricultural projects, including the 81.3-hectare Me Linh zone, the 96.6-hectare Dong Anh zone and the Yen Nghia zone.

The city aims to devise more drastic and specific measures to support the sustainable development of hi-tech agriculture regarding seedlings, animal feed, production, harvest and post harvest.

It will also encourage businesses to invest in technology in tandem with enhancing farmer awareness and participation in hi-tech agricultural production.

Other priorities include boosting the efficiency of agricultural cooperatives and financial allocation for key projects in agricultural development.

PMI records rise in four years

The Purchasing Managers’ Index (PMI) of Vietnam rose to 53.5 in April from 50.7 in the previous month, thereby signalling a solid improvement in business conditions, said HSBC Vietnam and Markit Economics Limited.

The two agencies’ press release issued on May 4 said the improvement was the strongest since the series began in April 2011. Business conditions have now strengthened in each of the past 20 months.

According to HSBC’s experts, driving the overall improvement in business conditions was a sharp increase in new business as a number of firms reported having secured new customers. The number of new orders from abroad was also surged, contributing to the improvement. The rate of expansion was the sharpest in the series history.

Higher new orders led to a 19th successive monthly increase in manufacturing production, with the rate of expansion quickening to the fastest since April 2011.

Manufacturers took on extra staff in order to help meet production requirements in April. The modest rise in employment followed a decrease in March.

Similar to months since last November, input costs in April decreased. Panellists reported lower costs for materials including oil, iron and steel, while some respondents had requested price reductions from suppliers.

The latest fall in input costs was the slowest in five months. Decreasing input prices was the main factor behind a further reduction in charges at Vietnamese manufacturing firms.

Increases in new business led to a sharp rise in purchasing activity during April. Input buying has now risen in each of the past 20 months, with the latest expansion in April was the strongest since April last year.

Stocks of finished goods also increased, following a decline in the previous month.

“Growth of the Vietnamese manufacturing sector stepped up a gear in April, with the latest set of numbers the most impressive in the four-year survey history. Central to the improvement was success for firms in securing new clients, helped by a continued lack of inflationary pressure,” Andrew Harker, Senior Economist at Markit was quoted by the press release as saying.

Construction of port serving power plant begins in Soc Trang

The construction of a river port for transporting materials and equipment to the Long Phu 1 Power Plant project commenced following a groundbreaking ceremony held on May 4.

Located in Long Phu district in the Mekong Delta province of Soc Trang, the 80-billion-VND (3.7 million USD) facility is expected to be completed in March 2016 and will be capable of accommodating ships of up to 1,000 gross tonnages.

Construction of the Long Phu 1 Power Plant began in 2011; the first turbine is scheduled to go into operation in 2018 and the second one year later.

Long Phu 1 is the first plant at the Long Phu Power Centre, which was approved in 2007, including three plants with a combined capacity of 4,400 megawatts.

Vietnamese products get attention in French fair

Vietnamese products got the French public’s attention at the Paris Fair 2015 from April 29 to May 10, which is going at the Versailles Exhibition Centre, according to Nguyen Thi Bich Hong, deputy director of the Vietnam National Trade Fair and advertising Company (Vinexad).

Hong said that most of Vietnamese products brought to the fair were very competitive in both quality and prices.

Up to 42 Vietnamese enterprises operating in a wide range of sectors such as lacquer painting, handicrafts, apparel, brocades, tea, dried fruit, took part in the annual event, according to the Vinexad.

Nguyen Canh Cuong, commercial Counsellor at Vietnam’s embassy in France, said Vietnamese companies rented a total area of 1,000 sq.m.

Nguyen Ngoc Son, Vietnam’s ambassador to France, asked Vietnamese enterprises to provide goods that suit the taste of the French and European customers as well as improve the quality of products and designs.

An art performance programme named ‘Hello Vietnam’, part of the ‘Tropical Festival’ was given an enthusiastic reception from the French public.

The biggest consumer products, handicrafts, traditional furniture fair in France drew over 1,800 exhibitors from more than 50 countries displaying the latest products in around 3,500 booths across an area of 200,000 sq.m.

Six-day holiday a windfall for Vietnam’s domestic tourism

While international tourist arrival numbers fell for the 11thconsecutive month in April, tourist hotspots across Vietnam reaped a bonanza during the national holiday ending on Sunday, which gave local salaried workers almost a week to spare.

[Tourists queue to buy air tickets at a travel fair in Hanoi on April 25, 2015.<br /><span>Tuoi Tre</span>]

Tourists queue to buy air tickets at a travel fair in Hanoi on April 25, 2015. Tuoi Tre

The website of the Vietnam National Administration of Tourism (VNAT) is today full of positive statistics any attractions would die for after the holiday, which kicked off on April 28 and was highlighted by the country’s 40th anniversary of reunification on April 30, wrapped up yesterday.

More than 100,000 visitors attended the Hue Traditional Craft Festival; Sa Pa welcomed more than 60,000 tourists; and An Giang Province received more than 50,000 holidaymakers per day.

These are a few among the stories recently published on the website, which proves the country’s tourist windfall from the domestic market.

The central province of Quang Binh, where late General Vo Nguyen Giap was laid to rest, welcomed more than 220,000 tourists during the holiday, according to the provincial tourism department.

More than 120,000 people chose to visit the resort town of Da Lat, the capital city of the Central Highlands province of Lam Dong, for the holiday, a 13 percent increase compared to last year.

In the north-central province of Thanh Hoa, the number of tourists recorded during the holiday was more than 80,000.

Many hotels and lodging facilities that had suffered poor occupancy due to the falling number of international holidaymakers were fully booked during the latest holiday, as locals rushed to beaches across the country to stay away from the baking heat.

The central city of Da Nang welcomed around 450,000 visitors in the period, a 13.9 percent increase from the holiday last year, according to the Ministry of Culture, Sports, and Tourism.

More than 92,000 holidaymakers meanwhile filled hotels and beaches in Nha Trang, the resort city of the south-central province of Khanh Hoa, whereas all hotels on Phu Quoc Island off southern Vietnam were fully booked.

The VNAT reported on April 27 that Vietnam’s international arrival numbers dropped 7.4 percent year-on-year to 690,440 tourists.

While Vietnamese travel firms struggle to lure international visitors, they have posted healthy growth from the domestic market, according to The Saigon Times Online, which cited the VNAT.

In 2009, when Vietnam’s international arrival numbers entered a downward trend that is still running today, the domestic market reported a 22 percent growth rate with 25 million tourists, according to VNAT data.

Last year 38.5 million local tourists took domestic packages and the market keeps growing against the sharp fall of its international counterpart.

Vietnamese tourists are also willing to pay for overseas trips, and have thus become favorite customers of tour organizers in many regional countries including Thailand, Malaysia, Singapore, and Cambodia.

In 2014 more than 285,000 Vietnamese tourists spent their holiday in Malaysia, whereas 424,000 and 500,000 chose Singapore and Thailand, respectively, The Saigon Times Online said, citing different travel agencies.

Vietnam is now the largest source of international tourists for Cambodia, with more than 900,000 vacationers visiting that country last year.

Harvest prices plunge for fruit growers in Mekong Delta

Fruit growers in the Mekong Delta region are getting less for their harvest while consumers are paying more because there are too many middle-men in the supply chain and growers lack adequate planning for their production.

Prices of sweet mango in Hoa An Commune of Dong Thap Province dropped more than half to VND7,000 a kilogramme in a month.

Truong Van Doi, a dragon fruit grower in My Tinh An Commune of Tien Giang Province, said prices have been fluctuating over the past two months, falling from VND60,000/kg to VND15,000/kg.

“Dragon fruit prices are expected to continue to fall in May,” Doi said.

But while farmers are forced to sell fruits at cheap prices, prices remain high in the market due to the proliferation of middle-men in the supply chain.

Farmers have invested heavily to meet standards under the Global Good Agricultural Practice system, but excess supply has met limited export markets, leaving them at the mercy of traders on domestic markets.

But while growers are getting less, prices in supermarket are rising.

“There are too many middle-men in the fruit supply chain,” said agricultural expert Vo Tong Xuan.

“Farmers should actively change their traditional methods of production based on small fields and take part in cooperatives to get better market information and have more chances to apply modern technology in their production,” he said.

Phone, electronics exports edge higher

Samsung phones on display at a retail store in HCMC. The country posted high growth of exports of phones, phone components, electronic products, computers and computer components in January-April - PHOTO: MANH TUNG

HCMC – The country posted high growth of exports of phones, phone components, electronic products, computers and computer components in the first four months.

According to the General Statistics Office (GSO), January-April export revenue picked up 8.2% from a year ago to US$50.1 billion. Exports of phones and phone components made up the biggest proportion, at around US$9.2 billion, up 13.9%, followed by textile-garment with US$6.55 billion.

The group of electronics, computers and computer components came in third with an export value of US$4.86 billion but its export growth was the strongest, at 62.9%.

Not only regional countries but also developed countries like those in Europe and the U.S. imported such products from Vietnam.

Statistics of the General Department of Customs showed major importers of phones and phone components in quarter one were the EU with US$2.22 billion, up 18.2%, the UAE with US$958 million, up 13.5%, and the U.S. with US$533 million, up 25.4%.

According to the General Department of Customs, exports of electronic devices, computers and computer parts in the first quarter to the EU reached US$761 million, up 71.7%, the U.S. US$638 million, up 98.1%, China US$554 million, up 23.1%, and the Netherlands US$221 million, up 90%.

A major contributor to such high export growth is the foreign direct investment (FDI) sector. Companies like Samsung, LG, Intel, Canon, Nidec, Fujitsu, Brother, Panasonic and Renesas export phones, electronic products, printers, computers and computer components.

With the increasing presence of phone and technology companies, according to analysts, Vietnam’s exports of electronic products will continue rising in the coming time.

According to the GSO, goods exports amounted to US$50.1 billion in January-April, with local firms making up US$15 billion, down 1%, and the FDI sector, inclusive of crude oil, accounting for US$35.1 billion, up 12.6%.

The U.S. emerged as Vietnam’s biggest importer with US$9.9 billion worth of products imported from Vietnam in the period, up 15.5%. It was followed by the EU with US$9.4 billion, up 10.6%, ASEAN with US$6.2 billion, up 2.7%, China with US$4.9 billion, down 1.2%, Japan with US$4.5 billion, down 5.8%, and South Korea with US$2.5 billion, up 20.3%.

VietinBank Insurance premiums jump 141% in Q1

VietinBank Insurance Company (VBI) reported premiums revenues of VND98.6 billion (US$4.6 million) in the first quarter of this year, rising 141% year-on-year and meeting 20% of the full-year target.

VBI looks to obtain VND500 billion in total premiums this year, up 50% versus 2014. The insurer established two branches and eight sale offices in January-March to boost sales and improve customer care services.

The insurer plans three more branches and 15 regional sale offices to increase the total number of its branches to 13 and that of sale offices to 50 this year.

In a bid to retain its current customers and attract new clients, the firm has since early this year launched a lot of insurance programs for luxury cars at Tet and gifts for those transacting with the company.

VBI got the “Vietnam Strong Brand 2014” award from the Vietnam Economic Times and the Vietnam Trade Promotion Agency under the Ministry of Industry and Trade late last month. This shows the firm has gained a foothold in the insurance market.

This award honors 95 local enterprises for obtaining good earnings results, ensuring benefits for employees, fulfilling tax obligations and contributing to local communities.

However, to further improve its performance, VBI will implement a restructuring plan, expand its network, apply advanced technologies to management, develop its branding and step up equitization.

When it goes public, it will be able to find strategic shareholders who are leading international insurers and reinsurers and who can help it improve business efficiency and competitiveness to become one of the strong financial corporations in the country.

Taxman collects VND2.5 trillion from 13,600 inspected firms

Local tax authorities have collected an extra VND2.5 trillion for the State budget from around 13,600 enterprises that were inspected in the first four months of this year.

A Ministry of Finance report reveals around VND11.5 trillion in tax arrears carried forward from the end of last year was collected in January-April, thus sending tax arrears in the period down 0.7% to VND68.5 trillion compared to late last year.

The additional tax collections have helped increase domestic tax revenues to VND238.7 trillion, equivalent to 37.4% of the target and up 17% against the same period last year.

The ministry credited the good tax revenue results in the four-month period to higher economic growth which has given a boost to business and production activities and the recovery of the property market.

April is also the time for companies to pay their corporate income tax for the first quarter.

In the first four months, the tax authorities have deducted and reduced losses of more than VND4.57 trillion at many enterprises among the 13,600 inspected firms.

Forty-nine localities have beaten their January-April tax revenue targets with a total of VND51.5 trillion, up 7.3% year-on-year.  

However, January-April tax revenue from crude oil is only VND23 trillion, down 32.6% and equivalent to 24.7% of the target as the crude oil price remains far lower than expected and that of last year. The average oil price in the period is US$58.3 per barrel, US$41.7 lower than estimated.

Despite the crude oil revenue plunge, total budget collections of the four months have reached VND314.1 trillion, up 9.4% year-on-year.

Rubber firms shift focus to domestic market

Local rubber processors are seeking to boost domestic sales to slash mounting stockpiles and reverse the export price plunge.

Speaking at a recent meeting with the Ministry of Agriculture and Rural Development, a leader of the Vietnam Rubber Industry Group said the rubber export price has taken a nosedive, from US$5,000 a ton in 2011 to US$1,500 at present.

The sale price is around VND31 million a ton while the production cost is VND30 million.

“We have held negotiations with large rubber exporting countries such as Malaysia, Indonesia and Thailand to prevent the export price from dropping below US$1,500 per ton in a bid to save local firms,” the leader said.

Although rubber demand has improved on a global economic recovery in recent months, the rubber price has yet to rebound, said Tran Thi Thuy Hoa, office manager of the Vietnam Rubber Association (VRA).

Rubber cultivation farms in Vietnam and elsewhere in the world have expanded rapidly, resulting in an oversupply. Besides, rubber prices depend heavily on oil prices which have plunged.

“As oil is the main fuel for production of synthetic rubber, a rival of natural rubber. The falling oil price has hit the rubber price. We hope that the rubber price would stay at the current level,” Hoa said.

Meanwhile, local enterprises are facing mounting pressure as many provinces will raise tax on rubber farmland. For instance, Tay Ninh Province plans to raise land tax to VND5 million (US$240) per hectare while the tax in Binh Duong and Binh Phuoc provinces will be VND2-3 million per hectare.

The tax spikes, rising stockpiles and falling prices will deliver a heavy blow to many firms, Hoa said.

To support local businesses, Minister of Agriculture and Rural Development Cao Duc Phat said the ministry would ask the Government to revise tax policy for the industry to help enterprises scale up domestic sales.

This is also a dear lesson for the agriculture sector. Without good planning and solutions, haphazard rubber area expansion has done more harm than good, he said.

He urged enterprises to develop a value chain instead of focusing on a single stage of the production process. Though Vietnam is a major rubber manufacturer, it mainly exports raw material, with annual export revenue of just US$2-3 billion, while local industrial companies have to import expensive finished products, Phat added.

Chinese firms interested in investing in Binh Duong

A delegation of representatives from 18 companies based in China's Fujian province met with Binh Duong provincial officials on Monday to learn about the local investment climate and seek business opportunities.

Vice Chairman of the Binh Duong People's Committee Tran Thanh Liem said the southern province was one of the top foreign investment destinations in Viet Nam with 2,460 projects worth nearly US$21 billion. China is running 204 projects with registered capital of some $1.4 billion.

Bac Ninh attracts 13 new FDI projects in April

The northern province of Bac Ninh granted licences for 13 new foreign direct investment (FDI) projects in April with total registered investment capital of US$10 million, and also allowed six existing ones to raise their capital by $28.7 million.

The province has granted new investment licence for 43 projects since the beginning of this year with total investment capital of $47.84 million.

There are currently 676 FDI projects worth $8 billion in the province.

Shrimp exports to key markets fall in Q1

Viet Nam's shrimp exports fell by 28.1 per cent in the first quarter compared to the same period last year, only hitting US$798 million, according to the Viet Nam Association of Seafood Exporters and Producers (VASEP).

Export to key markets saw sharp declines, with the US falling by 55.8 per cent, and Japan dropping by 27.6 per cent.

According to VASEP, the decline was a result of a decrease in import demand.

Foreign exchange rate fluctuations also had a considerable impact on Viet Nam's shrimp exports in the first three months of the year.

New tea production model aids ethnic minorities

It is hot, although it is still very early in the morning, and a group of ethnic minority women are already at work, picking tender tea leaves on a mountainside in the northern province of Lai Chau.

The Dao Do (Red Dao) women of Tam Duong District are dressed in their colourful traditional clothes, and their nimble fingers and hand movements seem to split the sunbeams slanting through mist as they keep putting handfuls of tea leaves into the papoose they carry on their backs.

Lifting up the papoose and wiping the sweat on her face as she takes a break under a tree on the tea plantation, Phan Thi Mui said she and other growers always harvested the tea leaves early in the morning. When the sun is up high in the sky, it is blazing hot and they cannot do anything, she said.

Mui, who is married and has two children, lives in Ban Bo Commune. She said her family previously grew maize and cassava, but this did not go smoothly and they were often faced with the prospect of going hungry.

In 2009, Mui's family began growing tea in 2009 with financial support from provincial authorities and the Lai Chau Tea Joint Stock Company. She said that without the support, her family's life would not have been as stable as it was now, and her children would not have been able to continue their schooling.

"My family earned VND70 million (US$3,200) last year, nearly half of it from tea. We now have some savings for the future."

While her family's income is not high compared to urban areas in the country, it is a significant sum in Tam Duong District, where the average annual household income is VND17 million ($790).

Mui's family is one of many who have benefited from the schemes carried about by the local tea company.

Located in a valley surrounded by many mountains, the company's Tam Duong factory is now seen as the heart of the tea business in Ban Bo Commune.

The factory, the second one opened by the company, began operations last June. It imparts tea cultivation knowhow to local residents, buys their produce and processes them for domestic and export markets.

In the past, more than 320 farmers from Ban Bo Commune sold their tea leaves to small processing facilities at low prices and in small volumes.

Today, the new factory on the spot allows for fresh tea leaves supplied by small producers to be processed very soon after harvest, helping the growers save significantly on transportation costs.

"In the past, the transportation cost was subtracted from tea leaves' prices. Now, that cost is fully credited to farmers. The local farmers harvested 558 tonnes of fresh leaves last year. They are estimated to have earned VND1,500 ($0.07) extra per kilogramme from this," said Director of Lai Chau Tea Joint Stock Company Nguyen Thi Loan.

Loan said local tea production had developed strongly since it began receiving technical support from HELVETAS Swiss Intercooperation in Viet Nam. HELVETAS works in the field of development co-operation, helping disadvantaged people and communities in developing countries improve their living conditions.

"HELVETAS has helped us increase linkages between tea farmers and buyers of finished products, improve the quality of tea production at both the farm and processing levels, and supported us in building an environment that enables sustainable tea value chain development."

The corner of a nursery at the Tam Duong Tea Factory in Lai Chau Province. Local tea production has seen robust development since it began receiving technical support from the HELVETAS Swiss Intercooperation.

Until 2011, when HELVETAS began supporting the company and farmers, residents were growing tea in a very unprofessional way, and lacked the knowledge to produce and harvest quality leaves.

"It was difficult. It took a really long time for us to persuade the ethnic minority people, who were most used to shifting cultivation, to develop tea gardens," said Loan.

She said two factors decided the quality of tea, the way it was harvested and how it was processed.

"It sounds so simple, the technique of pick one bud and two leaves, but we had to spend about half a year to persuade the growers to follow it. If they picked more than two, they would have more in quantity, but it would not meet our quality needs," she added.

Nguyen Hong Son, deputy head of Tam Duong District's Agriculture Division, said Lai Chau Province had 2,500 hectares of tea plantations, and 60 per cent of these were managed by the Tam Duong tea factory.

In Tam Duong District, 1,025 households grow tea and earn an average annual income from VND5-10 million ($230-460) each, the highest one earning VND50 million ($2,340).

"This is good for local residents, because they are able to do something with very little investment. They would not be interested if a venture demanded investments they could not afford. If it needed big investment, they would not have been interested," said Son.

Son said the district had identified tea as a key crop for poverty reduction and sustainable development. The district administration and the Lai Chau Tea JSC had canvassed households to try the new value chain model and guided them in implementing it.

"To kick start development, the district has provided money to growers to buy tea varieties and the Lai Chau Tea JSC has transferred knowhow and lent fertiliser and plant protection chemicals. The farmers have contributed their land and labour," Son said.

Loan said her company had been providing the farmers with fertiliser and plant protection chemicals for several years, but was yet to recoup its investment.

"In this province, especially in highland area, businesses have to accept some obvious disadvantages. If it does, it will be able to reap future gains.

"We want them to use quality fertiliser and plant protection chemicals. If they buy the wrong type in the market, it will affect the fresh tea's quality."

The company serves huge volume orders from the Middle East, Taiwan and mainland China. The collaborative project seeks to ensure stable and high supply of tea leaves through better management of tea production resources. It is set to export some of its tea products to Japan this year.

The company has eight main tea products including Oo Long, Sancha, Kim Tuyen, Sao Lan, Bao Chung and Nhai (Jasmine). In 2014, it exported nearly 800 tonnes of tea, earning VND50 billion ($2.34 million).

Loan said the factory provides jobs for nearly 50 workers and seasonal jobs for about 40 workers. Nearly 1,400 households participate by supplying tea to its factories.

HELVETAS Shan Tea project manager Vien Kim Cuong said Lai Chau Province was part of the "Developing High Quality Tea Value Chains for Poverty Reduction among Ethnic Minorities in northern Viet Nam, Laos and Myanmar" project, which is funded by the Swiss Agency for Development and Co-operation – SDC.

The project document says that it aims "to deliver sustainable livelihood improvements to tea producing smallholders by implementing a set of coordinated interventions to tackle interlinked constraints of tea value chains."

Cuong said that the increase in benefit farmers receive as a result of shortening the value chain by connecting growers directly with the processing company, eliminating middlemen, could be estimated at $120,000.

Lai Chau is located in the tropical zone and in a mountainous region endowed with a temperate climate "characterised by a strong monsoon influence, a considerable amount of sunny days, and with a high rate of rainfall and humidity."

"It is a poor province and it was not easy to decide which kind of crop HELVETAS should support. So far, I think tea is still the best crop that can be grown in this area," said Cuong.

Tea plantations have changed the landscape of Tam Duong District, replacing haphazard cultivation of various crops with one that benefits farmers and provides good quality produce to the company, serving the administration's poverty reduction target.

Looking out at the lush green plantations from atop a small hill, Loan said she had a dream. She hoped that this area would not only become the cradle of tea cultivation in the northern region, but also a popular tourist destination.

MoIT aims to increase exports of agro-fishery-forestry products

The Ministry of Industry and Trade (MoIT) will promote cooperation with other ministries and sectors to increase exports in the farming, forestry and fishery sectors, said an official of the ministry.

The ministry's largest goal was to solve existing difficulties at enterprises and exploit all opportunities to export their products to the world market, deputy minister of industry and trade Tran Tuan Anh said in Ha Noi on Monday at the ministry's conference on solving difficulties in exporting agro-fishery products.

At the conference, Duong Phuong Thao, deputy director of MOIT's Export and Import Department, said in the first four months of this year, export values of farming, forestry and fishery sectors had a year-on-year decline of 5.1 per cent to US$8.5 billion, including a strong drop in coffee and seafood exports, at 38.3 per cent and 15 per cent, respectively.

The reduction was due to higher supply of farming products, including rice in Thailand, India and Pakistan, and shrimp in India and Thailand, Thao said.

Other reasons of the decline in the export value involved increasing prices of the US dollar against the Yen and Euro, resulting in seafood importers having difficulties in negotiations of importing seafood, and the increase of trade and technical barriers for farming, forestry and fishery products in import countries, she said.

During the conference, members of the agro-fishery associations complained about the inadequate market information feedback received from overseas representative offices, which negatively affected the operation of domestic enterprises.

Vice General Secretary of the Viet Nam Association of Seafood Exporters and Producers Nguyen Hoai Nam proposed that trade promotion, whose public budget has shrunk, receive a boost through improved promotional methods.

The sector needs to become a national priority during negotiations for trade pacts between Viet Nam and other countries, he said.

Agreeing with Nam, General Secretary of the Viet Nam Coffee and Cocoa Association Nguyen Viet Vinh suggested increasing visits to other countries and conducting more market research surveys by those business delegations, with support by the Ministry of Industry and Trade.

Deputy Minister Tran Tuan Anh also said the ministry would issue or propose that the Government issue a directive on promoting farming, forestry and fishery exports.The ministry would ask trade offices of Viet Nam in foreign countries to provide more support for enterprises and share market information to assist in import and export activities, Anh said.

Further, MOIT would propose that the State Bank of Viet Nam consider policies on credit and guarantees for small- and medium sized enterprises, as well as for an exchange rate that creates favourable conditions for them to access capital with soft interest rates and develop export activities, he said.

Additionally, the ministry would focus on seeking new markets and consolidating its role in consulting domestic businesses during trade negotiations, assessing the competitiveness of local firms and consider adjusting production costs.

HCM City seeks NA nod for Metro 5

The HCM City administration wants the Government to seek approval from the National Assembly for Metro Line No 5 linking Bay Hien Intersection in Tan Binh District with Sai Gon Bridge in Binh Thanh District.

Plans for phase 1 of the project, to cost 1.56 billion euros (US$1.73 billion), has been submitted to the People's Committee, according to the HCM City Management Authority for Urban Railway (MAUR).

MAUR said funding for the line had been arranged with loans of 475 million euros ($527 million) from the Asian Development Bank, 275 million euros ($305 million) from the Spanish Government, 200 million euros ($222 million) from the German Bank for Reconstruction – KfW, and 150 million euros ($166.5 million) from the European Investment Bank and counter capital of 463 million euros ($513 million) from local sources.

Preparations for the 8.9km first phase have been accelerated so that construction can start in 2017.

Metro Line No 5 was scheduled to be completed in 2023, Tuoi Tre (Youth) newspaper quoted MAUR as saying.

It is designed to be 23.4 km long in all, running from Sai Gon Bridge to Can Giuoc Bus Station in Binh Chanh District.

It is the third line in the city to tie up funding after Line No 1 between Ben Thanh Market in District 1 with Suoi Tien Tourism Park in District 9 and Line No 2 from Ben Thanh Market to Tham Luong Bus Station in District 12.

The four others planned are Line No 3A from Ben Thanh to Tan Kien in Binh Chanh District and No 3B from Cong Hoa Intersection in District 3 to Hiep Binh Phuoc in Thu Duc District; No 4 from Nguyen Van Linh Avenue in District 7 to Ben Cat Bridge in District 12; and No 6 from Ba Queo intersection in Tan Binh District to Phu Lam Roundabout in District 6.

Preparations are underway for all of them.

Firms actively seek power savings

Businesses are looking to save power to lower expenses and avoid increasing prices after the cost of electricity rose 7.5 per cent in mid-March.

Many Vietnamese businesses expect to save money on power so they aren't forced to increase prices for consumers.

Son Viet Garment Company in HCM City uses hundreds of electric sewing machines and steam machines, and consumes a large amount of power. Ha Xuan Anh, chairman of the firm's management board, said that when production expenses increased, the firm had to raise its prices, which wasn't a wise choice in this economy.

The price hike also affected cement and supplement production, said Nguyen Quang Cung, president of the Viet Nam Cement Association. Cement prices would need to be raised between VND17,000 and 20,000 per tonne to cover the losses. But raising prices would hurt customers and competitiveness in the international market, he added.

Supermarkets have also been paying exorbitant sums for electricity. Big ones pay hundreds of millions of dong per month, while smaller stores pay tens of millions.

Many businesses have redesigned production workshops, and focused on maintaining machines and production lines to reduce electricity use.

Some enterprises have increased night shifts to benefit from the lower price of electricity.

Ha Noi's Industry and Commerce Department surveyed 92 key businesses in the city about their electricity use. About 60 per cent had specialised staff and strategies for saving power.

Ha Noi set a goal to use 6 to 9 per cent less electricity in 2015.

Dao Hong Thai, director of the Ha Noi Power Saving Centre, said that since last year the centre had provided enterprises power-saving solutions. It also helped enterprises in Quang Minh and Thang Long industrial zones use power-saving equipment, Thai said. Five enterprises were given 28 ideas that helped them save VND3.55 billion (US$165,000) per year.

Besides, the centre also helped more than 20 businesses in Gia Lam District save VND720 million (US$33,200) per year, he added.

The city will continue giving companies solutions on technology renewal and modern management methods.

Report outlines forecasts for 2015 economic performance

Inflation this year will fluctuate at about 3 per cent due to adjustments in public services, taxes and fees, the Viet Nam Institute for Economic and Policy Research (VEPR) has forecast.

If no price hike is seen in public services, such as health care and education, environment protection taxes and road fees, the inflation rate will be about 1 per cent, the institute has predicted in its latest report.

The report further says that prices of basic commodities are likely to continue to decrease from now until the end of the year, however, a significant change in oil prices will cause pressure on inflation.

As for foreign exchange rates, the report forecasts that the central bank could adjust the dollar/dong exchange rate up 2 per cent, as planned this year. The adjustment, if it is taken, will be in the final quarter of this year. In January 2015, the SBV devalued the dong by 1 per cent, from VND21,246 to VND21,458 per US dollar, which was the first exchange rate adjustment since June 2013.

The report also forecasts that Viet Nam's economic growth this year will be 6.3 per cent if oil prices average roughly US$60 per barrel throughout the year.

Lower oil prices, however, may cause a State budget deficit higher than expected, the report says, estimating that this year's budget deficit will be roughly VND45 trillion ($2.08 billion), or roughly 6-6.5 per cent of GDP if oil prices average $60 per barrel.

Such a deficit will force the Government to cut investment spending this year, the same as in 2014, VEPR warns.

It also forecasts that the country will have a trade deficit this year, after three consecutive years of trade surpluses, however, the overall balance will remain as a surplus thanks to an offset from foreign direct investment (FDI) capital and overseas remittance flows.

Also in the report, the institute has recommended the Government make a breakthrough in its policy reforms and actively create favourable conditions for private enterprises.

Of note, new policies should be mapped out to create a fair investment environment for all economic sectors.

Rice exports likely to rise from July

Vietnam is implementing a contract on exporting rice to the Philippines while negotiating with Malaysia on the same issue.

In the first four months of the year, the country exported 2.04 million tonnes of rice, earning US$889 million, down in 0.5% in quantity and 5% in value, according to the Ministry of Industry and Trade (MoIT).

The MoIT said the decrease is attributed to an abundant supply source of rice exporters which leads to a fierce competition in the market. Big rice exporters like Thailand and India have high stockpiles of rice. Especially, Thailand is taking drastic measures to export more rice to key markets.

Huynh The Nang, general director of the Vietnam Southern Food Corporation (Vinafood 2) hoped that from late June to early July this year, Vietnam’s rice exporters might gain more markets.

He added that from the beginning of the year, the Philippines has imported 300,000 tonnes of rice from Vietnam and is expected to buy an additional 500,000 tonnes.

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