Seminar discusses planning of hydropower plants for renewable energy development

The planning of medium to small-sized hydropower plants for the safe, efficient and sustainable development of renewable energy was the focus of discussions at a seminar held in Hanoi, on October 5. 

The event was jointly held by the Ministry of Industry and Trade (MOIT), the Ministry of Science and Technology, the Vietnam Institute of Economics, and the Industry and Trade Newspaper.

According to MOIT Deputy Minister, Hoang Quoc Vuong, the research has shown Vietnam’s huge potential to develop hydropower plants and other renewable energy sources.

The national strategy on developing renewable energy sources until 2030, with a vision to 2050, was approved by the Prime Minister in November 2015.

The plan set a total capacity of 21,600 MW for hydro power plants nationwide by 2020, 24,600 MW by 2025 and 27,800 MW by 2025.

To date, a total of 824 hydro power projects have been planned, with a designed total capacity of 24,778 MV, equivalent to 95.3% of the set target. The construction of the plants has driven the participation of many economic sectors, with most of the small and medium-sized projects having been invested in by non-State businesses.

The available hydro power plants have significantly contributed to ensuring national energy security and power safety, whilst creating jobs and improving the income of Vietnamese workers, thereby boosting local socio-economic development.

However, the construction and management of hydropower plants have revealed a number of shortcomings, such as imposing certain impacts on the local environment and transportation project in the localities, and a lack of human resources and experience in managing and supervising such projects.  

Illegal gas extraction threatens to destroy cooking gas industry

Head of the Ministry of Industry and Trade's Department of Market Management Trinh Van Ngoc promised to put an end to unhealthy competition and illegal gas extraction.   

The problem was discussed during a meeting about dealing with violations in liquefied petroleum gas business. Representatives of the Public Security Ministry's drug crime investigation police (C47) and market management of Hanoi, Bac Ninh, Hung Yen as well as various enterprises attended the meeting.

Doan Trong Tha, head of the legal department of Vietnam Gas Association, illegal gas extraction is an uncontrollable problem. Some shops store petroleum of unknown origin in cylinders from well-known brands to trick customers. In other cases, the shops save money by using empty cylinders from other brands, sanding and modifying the cylinders for their own use and this poses a huge fire risk.

However, there are no strict punishments for such violations. Nguyen Anh Tuan, head of a company in Lam Dong Province that provided fake petroleum, was only sentenced 18 months in prison and his sentence is still suspended.

Representatives of various companies including Van Loc, Hong Ha, Venus, and Anpha Petrol said they lost quite a large number of empty cylinders that can be reused. "The cylinders are sold as junk. This is a huge waste. An empty cylinder takes VND450,000 (USD20) to VND500,000 to make and it is sold at only VND100,000," said the representative of Tran Hong Quan Gas.

He went on to say that the company lost 300,000 cylinders and would have to spend tens of billions of VND to make new ones.

More inspections, stricter punishments and public awareness programme are needed. There should also be regulations on whether petrol companies can keep empty cylinders of other companies and for how long to avoid cases where a company hoards its competitor's empty cylinders.

Jimba Kentaro, director of Anpha Petrol said after two years in Vietnam, he could confirm the tough competition. According to Kentaro, if this situation goes on, customers will turn their back on cooking gas in 10 to 15 years.

Head of the Ministry of Industry and Trade's Department of Market Management Trinh Van Ngoc said the ministry had issued Directive 13 on October 4 to tighten management over liquefied petroleum gas. "Businesses that fail to meet required standards for fire safety will be suspended or have their licences withdrawn," he said.

Foreign printing and packaging equipment providers eye Vietnamese market

Foreign providers of machinery and equipment in the packaging and printing industry are increasingly promoting their products to penetrate the Vietnamese market, as seen at the international exhibition Vietnam Print Pack 2017 that kicked off in HCM City on October 5.

The exhibition took place at the Saigon Exhibition and Convention Center in District 7, featuring 480 booths of 300 enterprises from 11 countries and territories.

Hank Kan, business and marketing director of SBL Machinery Co Ltd., a Taiwanese manufacturer and provider of packaging machinery, said the company’s products have been shipped to European countries for many years. However, SBL has recently seen great opportunities for selling its products to Vietnam, as the country is attracting heavy foreign investments while its production is posting strong growth.

Hank Kan said the company wants to promote its products to local producers, and finds a major distributor who will represent SBL in the Southeast Asian nation.

He believed at least Vietnam-based Taiwanese companies will order SBL’s products, adding that producers from other countries may do so, as the company’s products are of high quality and competitively priced.

This is the first time Konia Minolta Business Solutions Vietnam has exhibited its products – digital label printers and inkjet printers - at the annual event. Le Minh The, its head of business and marketing division, said the printing products manufactured on the latest technology is very easy to use, helping enterprises save time.

Nguyen Van Dong, chairman of the Vietnam Printing Association, said printing and packaging exhibitions in the Asia have recently attracted many exhibitors and visitors, as Southeast Asian nations have achieved strong growth in the printing industry, especially the packaging segment.

Many enterprises told the Daily that Vietnam holds strong appeal to worldwide producers to build factories here, as the country has competitive advantages in terms of market and manpower. Meanwhile, domestic producers seeking to enhance competitiveness have no way but to improve their production efficiency.

Besides, the demand for consumer goods, packaged foods, bottled beverages and pharmaceuticals is rising, leading to an increase in packaged products.

Industry insiders said packaging is the decisive factor behind customers’ decision to purchase a product. Customers are more demanding, requiring packaging to be not only convenient but also safe and environmentally friendly. Therefore, enterprises in the packaging sector that want to survive should apply advanced technology.

According to foreign experts and companies, the local packaging sector has yet to develop. Thus, many providers of machinery and equipment for producers have realized considerable potential and major advantages in Vietnam. This is why they have joined exhibitions, and some have set up their offices in order to provide their products in a timely manner.

The organizers of Vietnam Print Pack 2017 – the Vietnam National Trade Fair and Advertising Company (Vinexad) and Yorkers Trade and Marketing Service Co Ltd. - said the local packaging and printing industry has developed quite high, with average expansion at around 15-20% of production value. Hence, the domestic market is quite appealing to international machinery and equipment providers.

The 17th expo closed on October 8.

Conference boosts start-up in Da Nang

The Embassy of Australia in Vietnam and HATCH! VENTURES – a social enterprise and startup incubator, jointly held a conference to boost startups in the central city of Da Nang on October 7.

conference boosts start-up in da nang hinh 0 The event, the fifth of its kind and the first in Da Nang, drew 200 local start-uppers and students.

Addressing the event, Australian Deputy Ambassador to Vietnam Layton Pike highlighted the friendship based on mutual assistance between Vietnam and Australia, saying that the Government of Australia highly valued the efforts of HATCH! with support programmes for startups and startup investment in Vietnam.

Pham Trung, Deputy Director of the Da Nang Business Incubator said the city has taken breakthrough steps to boost startups, including establishing the nation’s first public-private partnership (PPP)-based business incubator and organising annual startup events.

Da Nang has also launched a project on developing a startup ecosystem until 2020, with a vision that the city will become the startup and innovation hub of ASEAN region by 2030.

The project aims to develop a startup culture and enhance the awareness among local young people about startups, while completing and issuing relevant policies.

Investment will be made in local business incubators and infrastructure for startups, and in developing a training system on startup.

Cooperation will also be forged to mobilise more domestic and foreign resources in developing the startup ecosystem, with a focus on the PPP models.

Foreign firms paying staff 29 pct more than local companies in Vietnam: survey

The gap has narrowed since last year, but it's still wide enough to make a huge difference.

foreign firms paying staff 29 pct more than local companies in vietnam: survey hinh 0 Foreign companies in Vietnam are paying their employees 29 percent more than their domestic rivals, a new survey has found. 

The comprehensive survey, conducted by global human resources and business consulting firm Mercer with Vietnamese partner Talentnet, questioned 289,236 people from 592 companies operating in 16 different sectors across the country.

This year's results revealed that salaries for managers at foreign firms are 41 percent higher than the same positions at Vietnamese companies, while the average payments for experts and low-level employees are 30 and 15 percent higher, respectively.

Last year, Mercer and Talentnet found that foreign companies in Vietnam were paying their staff 31 percent more than their local peers.

Managers' salaries at foreign firms were 38 percent higher, while the respective rates were 30 and 20 percent more for experts and low-level staff.

The survey explained that the pay gap is bigger for managers at foreign and local firms this year because foreign firms want to give their managers what they deserve, as they are usually required to work hard.  

In its "2016 Best Places to Work" survey released in March, solution firm Anphabe and market research firm Nielsen found foreign firms accounted for 15 of the 20 best companies in Vietnam.

This survey collected feedback from 26,128 employees working in 24 different sectors. Rankings were based on salary levels, bonuses, welfare and work-life balance for employees.

Businesses face hurdles to enter global supply chain

The Ministry of Industry and Trade held a seminar on Friday (October 6) in Hanoi to discuss policies to help Vietnamese businesses participate in the supply chain during the period of integration.

Addressing the seminar, Deputy Minister of Industry and Trade Do Thang Hai underscored the importance of the supply chain, adding that the government has assigned relevant ministries including the MoIT to devise policies to support businesses in developing a sustainable supply chain.

Mr. Hai emphasized that the event provided insights into the real situation of Vietnam’s participation in the global supply chain at a time when the government is determined to build a constructive system of integrity and action.

At the seminar, experts exchanged information on the mechanisms of support available for Vietnamese businesses to participate in the global supply chain during the integration period, on the experience of successful businesses in expanding markets, and on the Law on Support for Small and Medium-Sized Enterprises.

Experts said Vietnam has more than 90% of SMEs, which have encountered difficulties in terms of capital, technologies, lack of management skills and connectivity. These are the major hindrances for businesses when joining the supply chain and integrating the world economy.

Tay Ninh introduces local tourism, culture in Hanoi

A range of activities featuring the culture and tourism attractions of the southwestern province of Tay Ninh are taking place in Hanoi, on the occasion of the 63rd anniversary of the Liberation Day of the capital city (October 10).

They include a photo exhibition on the 180-year history of the formation and development of the province. Tay Ninh’s special products are also being showcased, drawing crowds of local visitors.

Addressing the opening ceremony on October 6, provincial officials expressed the hope that the activities will help promote cooperation and exchanges between the province and Hanoi.

Two documentaries were also screened during the ceremony to introduce local tourism potential and the development of the province. 

The same day, a folk music show was held, featuring Don ca tai tu (southern amateur singing), which has been recognised as part of the intangible cultural heritage of humankind by the UN Educational, Scientific and Cultural Organisation (UNESCO).

Tay Ninh is home to the main cathedral of Cao Dai sect. The Ba Den Mountain is also a popular destination for spiritual tourism. 

The province receives between 2.2 and 2.7 million tourists per year and sees an annual growth rate of over 10 percent in tourism. In 2016, the tourism sector earned 770 billion VND (33.88 million USD).

Ban Phuc Nickel suspends operations due to massive losses

Ban Phuc Nickel Mines Limited Liability Company (BPNM) has decided to suspend the operations of Ban Phuc Nickel mine until September 30, 2018 due to the company’s massive losses.

In 2007, Asian Mineral Resources Limited (AMR), a global mining group listed on the bourse in Toronto, Canada, was granted the licencee to exploit and process ores in the Ban Phuc nickel ore mine, which has a reserve of more than 200,000 tonnes of nickel and 18,000 tonnes of copper.

According to the initial plan, AMR will co-operate with domestic enterprise Son La Mechanical Engineering JSC to establish BPNM, with AMR holding 90 per cent, to develop the project which lies 160 kilometres northwest of Hanoi in Son La province. BPNM envisioned starting production in mid-2009.

However, due to low market demand, the project halted construction in 2008 to await better market conditions.

The project finally started mining and processing activities in May 2013. At that time, BPNM poured $136 million into developing the plant and took it into operation with the annual exploitation capacity of 360,000 tonnes of ores and processing capacity of 70,000 tonnes of refined ores.

By the end of November 2013, BPNM has produced and exported 10,503 tonnes of refined nickel ore with an average concentration of 9.5 per cent.

However, in February 2014, BPNM proposed the government to reduce refined nickel ore export tariff from 20 to 10 per cent to sustain production.

According to Evan Spencer, BPNM’s general director, the plunge in the global price of nickel had brought down domestic prices in turn.

Meanwhile, taxes and associated fees are high in Vietnam and account for 32 per cent of BPNM’s revenue, which includes 20 per cent export duties, 10 per cent environmental tax, and 2 per cent of other associated fees. Furthermore, the company has to to pay numerous other fees, including land leasing fee and corporate income tax.

BPNM executives said the Vietnamese nickel business is taxed even higher than in Laos, where the export duty on ores is 5 per cent only, and claimed that only operating costs would be covered after taxes.

At the time, BPNM even threatened closing the mining site in late May, unless given timely support.

However, the government refused BPNM’s proposal. As a result, in 2014 alone, the company suffered a loss of approximately $20 million.

Despite Vietnam refusing to reduce the export tariff on refined nickel ore, the company maintained operations in the red before eventually deciding to suspend operations in September 2016.

As of May 2015, BPNM reported an accumulated loss of $55 million, which increased to $129 million by August 2017.

According to BPNM's current general director Stephen John Ennor, the low global price of nickel, coupled with high taxes and high manufacturing expenditure, the company’s revenue is not large enough to offset expenditures to maintain its operations.

Thus, BPNM was forced to suspend operations for three years from September 2016 to September 2018. However, it will still explore ores sites on an area of 49.7 square kilometres, according to its mining licence.

AMRO: Growth at 6.5% in 2017 & 2018

Vietnam’s economy has rebounded strongly and is expected to grow at 6.5 per cent this year, with inflation being contained at below the targeted 4 per cent, according to the preliminary assessment from the ASEAN+3 Macroeconomic Research Office (AMRO) following its annual consultation visit to the country from September 28 to October 4.

The mission was led by Dr. Seung Hyun Hong, AMRO Lead Specialist, who was accompanied by Dr. Hoe Ee Khor, AMRO Chief Economist, and Mr. Yasuto Watanabe, Deputy Director of CMIM, Strategy, and Coordination. Discussions focused on recent developments and short-term prospects, risks and vulnerabilities, as well as structural reforms in the economy. AMRO also discussed technical assistance activities, including secondment and consultancy programs, with Vietnamese authorities.

“Vietnam’s economic growth has picked up strongly in 2017, supported by strong manufacturing exports, strengthened domestic demand, as well as recovery in agricultural outputs,” said Dr. Hong. “As growth momentum is expected to remain strong, authorities should strengthen the policy focus on financial soundness, continue fiscal consolidation efforts, and accelerate structural reforms.”

Economic activity has rebounded from a slow start in the first quarter, with GDP growth estimated at 6.4 per cent in the first nine months, up from 6 per cent a year ago. While headline inflation has risen, mainly driven by increases in State-administered prices, underlying inflationary pressures remain subdued. The short-term growth outlook remains positive, with economic growth projected to pick up to around 6.5 per cent in 2017 and 2018.

Vietnam’s external position has continued to improve, benefiting from strong export performance and increased foreign investment. Greater flexibility in exchange rate management has also improved the economy’s resilience against adverse external shocks, while allowing the State Bank of Vietnam (SBV) to rebuild its reserves. Downside risks, however, stem from policy uncertainties in several advanced economies, which could lead to greater volatility in financial markets and capital outflows.

The fiscal deficit moderated in 2016 and is expected to narrow significantly in 2017, in line with the government’s fiscal consolidation target. The mission team supports the consolidation plans laid out in the Five-Year National Fiscal Plan and Medium-Term Public Investment Plan for 2016-2020, and encourages authorities to continue their efforts to enhance revenue while giving priority to rebalancing towards capital expenditure and improving public sector efficiency.

Credit growth has been buoyant and highly supportive of economic activity. In light of strong growth momentum in recent quarters, the policy focus on financial soundness should be strengthened. Faster credit growth could undermine the progress made in improving the still-fragile banking system by creating new non-performing loans (NPLs) and weakening banks’ capital buffers.

Authorities’ recent initiatives to reform the banking sector, including a pilot NPL resolution scheme, are a welcome move. Further efforts to accelerate NPL resolution and bank recapitalization are strongly encouraged.

Continued structural reforms will help the economy address medium- to long-term challenges. In the State-owned enterprise sector, reform momentum has strengthened with a recent pick-up in the pace of divesting State assets.

Going forward, enhanced financial transparency and strengthened implementation are needed to expedite the process. Challenges could arise from climate change and a rapidly aging population. Well-designed policy measures with concerted implementation efforts are therefore essential. 

2017 wood export turnover can reach $8bn target

Wood export turnover can reach the targeted $8 billion this year, Mr. Nguyen Ton Quyen, Secretary General of Vietnam Forest (Vifores), told a conference on wood exports and imports on October 5.

Wood and wooden product export turnover stood at $3.57 billion in the first six months of the year, up 13.6 per cent compared to the $3.14 billion recorded in the first half of 2016. Export turnover came in at $700 million each month on average during the first nine months.

Mr. Quyen emphasized that the export season for wood and wooden products is the final three months of the year, so he believes turnover can reach the targeted $8 billion for the year.

Because of its significant growth, however, Vietnam’s wood and wooden product sector has had to address a range of problems. Resource are shrinking as competition is rising, from both domestic suppliers and imports.

China’s policy banning natural wood harvesting from natural forests together with policies tightening the exploitation, trade and export of raw materials in other countries supplying natural forest timber from tropical forests has created a shortage.

The domestic supply of raw materials is particularly acute for planted timber and rubber wood.

Mr. To Xuan Phuc, Policy Analyst at Forest Trend in the US, told the conference that in the first half of the year, turnover from wood material exports was $1.2 billion, up 12.8 per cent year-on-year.

Wooden product export turnover reached $2.36 billion, up 14 per cent year-on-year.

As at September, total export value was estimated at $5.51 billion for the year, an increase of 10.6 per cent year-on-year. The US, China, and Japan were Vietnam’s three largest markets for wood and wooden products in the first eight months of the year, together accounting for 70.3 per cent of value.

EuroCham launches Northeastern Vietnam Chapter in Hai Phong

The European Chamber of Commerce in Vietnam (EuroCham) held the “Northeastern Vietnam Focus Day” and launched its Northeastern Vietnam Chapter in Hai Phong on October 5.

This is the second regional chapter of the chamber, following the Central Vietnam Chapter, which opened in November 2016.

“As EuroCham Vice Chairman, I am very happy to open this EuroCham Chapter covering the northeastern region and putting today’s event forth for the first time,” said Dr. Gellért Horváth, Vice Chairman of EuroCham. “Local businesses and authorities in Bac Ninh, Hai Duong, Hai Phong, Hung Yen, and Quang Ninh responded well and appeared in good numbers, showing that we were right: the local business dynamics are increasing and there is a need for platforms to bring the business community together, namely European business. I am proud that EuroCham is now present in the northeastern region and closer to its members, and hope that new partnerships and new dynamics will be formed with our chamber’s presence here.”

The agenda included joining the breaking ground ceremony for the Deep C Industrial Zone, a tour of new industrial facilities around the Hai Phong, such as Lach Huyen Port and Tan Vu Bridge, and a working lunch where business leaders, local authorities, and European diplomatic representatives discussed the potential of the northeastern region as a prime investment destination in Vietnam.  

The Northeastern Vietnam Focus Day was dedicated to informing people about the economic and business opportunities in the region’s cities and provinces, including Bac Ninh, Hai Duong, Hai Phong, Hung Yen, and Quang Ninh.

Experts and officials covered cross-cutting business topics from a site-specific perspective, including investment practices, tax incentives, local talent management, real estate development, and new infrastructure, among others. It was a one-time opportunity to hear from experts and the government in regard to the current state of Hai Phong and northeastern Vietnam’s business potential.

The region is well-positioned to become the next top business, trade, and investment destination in Vietnam and EuroCham has taken a decisive step to ensure that present and prospective members doing business in the region are well supported.

To this end, Dr. Horváth opened the event and officially launched EuroCham’s Northeastern Vietnam Chapter. Three EuroCham delegates will carry out the organization’s action on the ground, aiming to bring further dynamics in the contact between local business communities and supporting around 40 EuroCham members in the region, including large investors such as Apollo, Ariston Thermo, DB Schenker, Deep C Industrial Zones, Gentherm, Knauf, Mascot, Messer and many more.

The EU Ambassador to Vietnam, H.E. Bruno Angelet, was present at the event and strongly supports the creation of this second EuroCham Chapter outside of Ho Chi Minh City and Hanoi, highlighting the importance of European business being active in strategic high potential regions in Vietnam. Ambassador Angelet underlined the significant role EuroCham could play in attracting high quality investment from the EU in the framework of the opportunities from the upcoming EU-Vietnam Free Trade Agreement.

Its second representation office in its 18 years of existence, the EuroCham Northeastern Vietnam Chapter is set to empower the local business community, offering an annual, locally-focused agenda of business events, advocacy support, and networking opportunities.

Development opportunities abound in tourism

Never before has Vietnam’s tourism sector seen such strong development opportunities as now, Mr. Nguyen Van Tuan, Director General of the Vietnam National Administration of Tourism (VNAT), told the 18th The Guide Awards held by the Vietnam Economic Times Group at the Novotel Phu Quoc Resort  on Phu Quoc Island on October 6, with the theme “Green Tourism for a Green Economy”.

He also emphasized that never before has the sector received so much attention from the government and the State.

The Politburo issued Resolution No. 8, on developing tourism into a spearhead economic sector by 2030. On June 9, the Prime Minister officially signed the Government Action Plan to implement Resolution No. 08, promulgating the Law on Tourism 2017 in June, which will come into effect in 2018. Mr. Tuan believes that this is a very good opportunity for the tourism industry to develop strongly in the future.

At the Awards ceremony, Mr. Tuan, on behalf of the tourism industry and VNAT, congratulated winning businesses. “The tourism sector is in great need of community contributions, and Vietnam Economic Times has taken practical action to contribute to the development of Vietnam’s tourism,” he said.

Vietnam’s tourism sector recovered and developed last year, with 10 million international tourists, up 26 per cent compared to 2015, and in only the first nine months of this year, 9.5 million international tourists have been welcomed.

This year it is expected that the tourism sector will meet the targets set by the government of welcoming 13 million international visitors and 75 million domestic tourists, up 30 per cent, with direct revenue to reach $23 billion.

“With such a contribution, Vietnam’s tourism sector makes a positive and important contribution to the socioeconomy, and tourism alone contributes approximately 1 per cent to the 6.7 per cent economic growth in 2017,” he added.

This year’s World Tourism Day was held in Qatar, with the theme “Sustainable Tourism - A Tool for Development” and with the goal of celebrating sustainable values, contributing to sustainable economic development, according to Ambassador Nguyen Phu Binh, former Deputy Minister of Foreign Affairs and Deputy Editor-in-Chief at Vietnam Economic Times.

“Resolution No. 08 aims to make tourism a spearhead economic sector by 2030 and bring Vietnam’s tourism sector to the forefront in Southeast Asia, which puts pressure on the sector given that inadequacies and limitations not been resolved thoroughly,” Mr. Binh said.

In that context, aware of the meaning of and the value of conservation and sustainable development, Mr. Binh went on, Vietnam Economic Times wants to accompanies tourism businesses in reaching “Green Tourism for a Green Economy”.

The 18th The Guide Awards honored 115 tourism providers, divided into six groups: Resorts, Hotels, Apartments for Rent, Restaurants, Travel Agents, and shopping and healthcare services.

Top-notch awards were presented to six resorts: Amanoi Resort, An Lam Retreats Ninh Van Bay, Four Seasons Resort The Nam Hai, JW Marriott Phu Quoc Emerald Bay, Nam Nghi Phu Quoc Island, and Naman Retreat.

In the hotel group, top-notch awards went to four hotels: Sofitel Legend Metropole Hanoi Hotel, The Reverie Saigon Hotel, Park Hyatt Saigon, and JW Marriott Hanoi.

Eight other tourism units were presented with a Green Lotus Award 2017, in recognition of them protecting the environment and natural resources: Amanoi Resort, An Lam Retreats Ninh Van Bay, Ana Mandara Villas Dalat Resort & Spa, KOI Resort & Spa Hoi An, Laguna Langco, Mango Bay Resort, Nam Nghi Phu Quoc Island, and Princess d’An Nam Resort & Spa.

115 hotels & resorts win The Guide Awards

The 18th The Guide Awards were held by the Vietnam Economic Times Group at the Novotel Phu Quoc Resort  on Phu Quoc Island on October 6, with theme “Green Tourism for a Green Economy”.

This is the first time The Guide Awards has been held on Phu Quoc Island, known as Vietnam’s “pearl island” and with pristine beaches and smooth white sands.

The number of international visitors to Vietnam this year as at September is estimated at 9,448,331, an increase of 28.4 per cent year-on-year.

Phu Quoc Island welcomed 242,999 international visitors, up 25.1 per cent year-on-year, with revenue of VND2.87 trillion ($126.2 million), up 24.9 per cent, according to the latest figures from the Vietnam National Administration of Tourism.

This shows the attraction the island holds, with 62 per cent of its area being primitive forest and with hundreds of kilometers of coastline. Tourism is developing strongly on the island, with a series of high-end condominium projects being built and opening soon.

It is expected that, by 2020, Phu Quoc Island will have an additional 10,000 hotel rooms and attract higher numbers of both domestic and international visitors. The problem, however, is that without a proper planning it is likely that the island will face over-development, which will affect its environmental and natural resources.

Such factors are why this year’s The Guide Awards were held on Phu Quoc Island. With the theme “Green Tourism for a Green Economy”, The Guide Awards aspires to be a bridge where travel agencies and policy makers can meet and discuss green and sustainable tourism development into the future.

With criteria regarding green values and sustainable development, the Organizing Board surveyed, collected opinions, voted, and honored 115 tourism providers, divided into six groups: Resorts, Hotels, Apartments for Rent, Restaurants, Travel Agents, and shopping and healthcare services.

Top-notch awards were presented to six resorts: Amanoi Resort, An Lam Retreats Ninh Van Bay, Four Seasons Resort The Nam Hai, JW Marriott Phu Quoc Emerald Bay, Nam Nghi Phu Quoc Island, and Naman Retreat.

In the hotel group, top-notch awards went to four hotels: Sofitel Legend Metropole Hanoi Hotel, The Reverie Saigon Hotel, Park Hyatt Saigon, and JW Marriott Hanoi.

Eight other tourism units were presented with a Green Lotus Award 2017, in recognition of them protecting the environment and natural resources: Amanoi Resort, An Lam Retreats Ninh Van Bay, Ana Mandara Villas Dalat Resort & Spa, KOI Resort & Spa Hoi An, Laguna Langco, Mango Bay Resort, Nam Nghi Phu Quoc Island, and Princess d’An Nam Resort & Spa.

The Guide Awards are an annual event organized by the Vietnam Economic Times Group’s The Guide magazine, recognizing the achievements and contributions of enterprises, organizations, individuals, and localities in Vietnam to the country’s tourism development.

First held in 1999, The Guide Awards are sponsored by the Vietnam National Administration of Tourism and the Vietnam Economic Science Association. The Awards have gained in prestige over the years and earned recognition and appreciation from tourism enterprises and State management agencies.

National financial commission sets 2017 projected GDP growth at over 6.7%

The growth rate for the fourth quarter of this year will be around 7.5-7.7% and the GDP for the whole year of 2017 may reach over 6.7%, the National Financial Supervisory Commission (NFSC) has forecast.

According to the NFSC, GDP growth in the third quarter achieved impressive results, up 7.46% over the same period of last year, due to all three sectors of the economy (agro-forestry-fisheries, industrial and construction, and service sectors) maintaining their recovery momentum, especially in the manufacturing industries which saw a sharp increase of 12.77% (the same period last year increased by just 11%).

This is the third quarter that witnessed the highest growth rate in the last ten years.

The third quarter witnessed a surplus of US$1 billion, greatly improved after the first two quarters, which saw a deficit, due to increased exports.

The commission forecasts that exports will continue to rise sharply in the fourth quarter due to the improvement in global trade in the last months of the year.

The aggregate demand continued to improve, contributing to the growth in the third quarter. Investment capital increased positively over the same period last year, as FDI disbursement, in the first nine months of the year, was estimated at US$12.5 billion, an annual increase of 13.4%.

The NFSC also noted that the “trend” component – the indicator showing the supply capacity of the economy – has continuously improved, demonstrating that the solutions proposed by the Government, to improve the investment environment and business development, have achieved positive results, creating a strong impetus for economic growth.

In Q4, consumption and investment demand is forecast to increase sharply as the rate of disbursement of investment in capital construction is accelerated.

Meanwhile, exports are also likely to rise sharply due to favourable developments in the world economy, as well as global trade growth.

In addition, according to the commission’s analysis, inflation is tends to be stable as food and foodstuff prices are less likely to fluctuate. In the absence of a sudden adjustment of public service prices in the last months of the year, inflation for the whole 2017 would only increase by approximately 3% over the same period last year.

Japan third largest trade partner of HCMC

Japan has been the fourth largest investor out of 92 nations and territories investing in HCMC and third largest trade partner of the city, said standing deputy chairman of the HCMC People’s Committee Le Thanh Liem last night.

The figures showed that economic, commercial and investment relations between HCMC and Japan have been more and more intensified, said Mr. Liem while receiving Nakagaki Yoshihiko, deputy chairman of the Japanese Association for the Promotion of People's Diplomacy (FEC), who has been in HCMC during a working visit.

The relationship between HCMC and Japan have made new development steps especially in delegation exchange and relations with central and local agencies of Japan.

Mr. Nakagaki Yoshihiko said that Japanese cities have similarities with HCMC about challenges and difficulties in urban development process, population increase pressure and traffic jam.

Japanese businesses are willing to cooperate with HCMC to solve issues relating to environmental pollution, green urban building and sustainable development, he affirmed.

HCMC adopts measures to stabilize pork price

The Ho Chi Minh City Department of Industry and Trade sent its report about measures to stabilize market and to prevent scarcity of pork, raising price after Xuyen A slaughterhouse in the city’s outlying district of Cu Chi was asked to cease operation. 

The Department has liaised with farms in the city and neighboring provinces which said the supply if abundant at present promising to transport to assigned slaughterhouses as per the city authority request in case that the city is short of pork.

Because Xuyen A slaughterhouse has capacity of 5,000 pigs a day, the Department will replace it with Anh Hoang Thi slaughterhouse in the southern province of Dong Nai which has partaken in the project to trace back the origin of pork to increase its capacity of additional quantity of 700 pigs a day; State-run Vissan Company will also increase the quantity to 1,300 pigs a day and other slaughterhouses raise its output everyday. Yet Anh Hoang Thi or Vissan perform industrial slaughtering with high charges and their products mostly provide for their distributor chains not for wholesale markets.

Therefore, total slaughtered pigs are 3,500 per day from city’s slaughterhouses and neighboring provinces which mostly Long An will supply 1,500 to cover the shortage.

Besides, merchants will make decision to choose small and cheap slaughterhouses in neighboring provinces to meet the requirement for supplying pork for the city.

The Department will work with supermarkets to increase the supplies to prevent shortage and keep the market stable.

HCMC agricultural production value tops $376 million

HCMC’s agricultural, forestry and seafood production value was estimated to reach VND8,565 billion (US$376.87 million) during the first nine months this year, up 6.3 percent over the same period last year.

The city’s policy is to continue developing modern urban agriculture toward high and bio technologies.

HCMC strives to become a domestic animal breed and seedling production center having high productivity and added value and meeting residents’ requirements.

The city’s agricultural industry has sped up transferring progress in breed and seedling as well as bio technology application to farmers, creating many seedlings and improving the quality of dairy cow and beef cattle herds.

Flower and ornamental plant area in the city totals about 1,970 hectares, including 359 hectares of hi tech orchid plants and 235 herbs of dairy cows bred according to Israeli technology.

In addition, the city is an ornamental fish development center. For the last nine months, it has exported over 13.36 million ornamental fish.

Vietjet honored at the Guide Award

Vietjet has been honored as “Pioneering Airline Award” at the festival of the national tourism industry 2017 (The Guide Awards) which was held by The Guide magazine of Vietnam Economic Times, for the outstanding contribution to the development of Vietnamese tourism. 

The Guide Awards 2017 with “Green Tourism for a Green Economy” theme has been held on Phu Quoc Island (Kien Giang Province), known as the “pearl” island where the tourism environment problems have been strongly and comprehensively addressed with the outstanding criteria for ensuring the green values and sustainable development.

 The Guide Awards are an annual event organized by the Vietnam Economic Times Group’s The Guide magazine, initiated in 1999 and held for the last 18 years. The awards were honored the enterprises, organizations which had efficient performances and contributed very much to the development of Vietnamese tourism.

The award results were based on votes, opinions of readers, in addition to the performance and practical survey of The Guide’s organizers, and collection other trustworthy information sources and the media.

HSBC: More Thai firms to tap Vietnam market

Many Thai enterprises are interested in the Vietnam market and they will strengthen investment in the country to catch new opportunities in various fields, said Kelvin Tan, CEO of HSBC Thailand Bank.

Speaking to local reporters at a conference in HCMC yesterday, Tan said Thai firms would raise investment via direct investment and merger and acquisition deals.

In recent time, the nation has seen many mergers between Thai and Vietnamese firms, among which HSBC Vietnam has participated in large transactions between BJC and Metro’s Cash & Carry, Central Group’s PowerBuy and Nguyen Kim shopping center.

Thai investors pay much intention to the retail market, focusing on the food and beverage and consumer goods sectors. In addition, they have plans to invest in other fields such as building materials, power plants and feed production.

Thai firms favor investment in Vietnam as the two countries are in close proximity and have many similarities in culture, Tan added.

In addition, Vietnam has turned attractive to international investors due to its active participation numerous in free trade agreements (FTAs) and the ASEAN Economic Community. When tariffs are removed, Thai firms will eye Vietnam as a transit point to enhance exports to other countries.

When 16 FTAs Vietnam has participated become effective in 2020, Vietnam will join a network with 59 partners, including 15 G20 member countries. Meanwhile, Thailand does not have as many FTAs as Vietnam.

Besides, Vietnam has advantages of macro-economic and political stability, low labor cost and the Government’s incentives.

According to Pham Hong Hai, general director of HSBC Vietnam, the lender has visited some ASEAN countries to call for investment into Vietnam over the past three years. In Thailand, many investors said Vietnam was their top priority.

As HSBC concentrates on Asia, especially ASEAN markets, HSBC Vietnam has developed business in nations with large investment in Vietnam.

According to the General Statistics Office, Thailand had invested US$8.13 billion in 458 active projects in Vietnam, ranking 10th among 115 nations and territories with largest investment in the country by March. It had ranked third in the ASEAN region after Singapore and Malaysia.

Between January and June, Thai enterprises poured US$146.4 million in 20 projects in the country.

SMEs need to improve transparency for easier access to capital

Information transparency is one of the key factors that help small and medium enterprises (SMEs) get funding from credit institutions, said experts at a conference on financial solutions for SMEs held by the State Bank of Vietnam in Hanoi on October 5.

Can Van Luc, an expert in finance and banking, said SMEs are classified as those with an average number of employees covered by social insurance in the preceding year of no more than 200 each. Besides, their total capital in the preceding year should not exceed VND100 billion (US$4.4 million) and turnover in the preceding year not higher than VND300 billion.

There were about 590,000 operational SMEs in Vietnam as of late 2016, with 68% of them micro enterprises.

SMEs mainly get funding from the State budget, foreign investment, stocks and bonds, business partners, credit, and their own capital. 

Luc said many SMEs lack access to finance, which hinders their growth. The reason is that SMEs are not attractive to credit institutions because they have poor credit and high operating costs.

Credit institutions have not had specific products and services for SMEs, and complicated procedures have caused slow capital disbursement.

According to Luc, most SMEs have poor business governance and lack transparency, use obsolete technologies and unskilled laborers, and are unable to meet the banks’ lending criteria. Besides, they lack business strategies, strong brand, competitive products, assets as mortgage, risk insurance, and deep understanding of financial policies.

Hoang Thi Hong, chairwoman of the Small and Medium Enterprise Development Fund (SMEDF) under the Ministry of Planning and Investment, said SMEs need to make their information transparent if they want to get access to financial support. The most important information that credit institutions need before they make lending decisions include the SMEs’ total assets, owner’s equity, annual revenue and profit, and business performance.

Hong suggested SMEs actively work with credit institutions, create effective business plans, enhance their understanding of the Government’s financial and supporting policies, cooperate with each other, and improve management skills.

For credit institutions, they should launch products and services aligned to SMEs’ specific characteristic, with simple lending procedures and favorable interest rates.

According to Doan Duy Khuong, vice chairman of the Vietnam Chamber of Commerce and Industry (VCCI), SMEs account for 97% of Vietnam’s total number of enterprises and 45% of the country’s gross domestic product (GDP). They contribute 31% to the State budget, and employ over five million workers.

Deal on supporting startups, SMEs struck

Saigon Trading Group (Satra) and Startup Vietnam Foundation (SVF), a HCMC-headquartered non-profit fund, on October 4 clinched a deal to support startups and small and medium-sized enterprises (SMEs).

Under the strategic cooperation, SVF will assist startups and SMEs in grasping opportunities to become suppliers of material and processed products to the supermarkets, convenience stores, and wholesale markets of Satra.

Besides, the two agencies will co-organize events and seminars whose aims are to introduce products, promote trade, as well as train and consult enterprises and farmers.

Nguyen Phuc Khoa, Satra’s deputy general director, told the Daily that the group is in dire need of unique products for its retail systems in a bid to improve its competitiveness. He hoped to find such products from startups whose innovation and creativity are appreciated.

Enterprises that have yet to gain extensive experience can contact with the SVF for information and advice on procedures and product standards to have access to the distribution channels of Satra.

SVF is a non-profit innovation fund which supports startups, especially those active in hi-tech agriculture.

HCMC joins hands with tourism assoc. to boost tourism development

The People’s Committee of HCMC and the HCMC Tourism Association on October 4 signed an agreement on tourism development cooperation, aiming at supporting travel firms, ensuring tourist safety and security, carrying out promotional programs and creating specific tourism products for the city.

The two sides had plans to implement specific programs in the last months of 2017 and in 2018.

They will organize a dialogue to discuss tax policies related to tourism such as land tax and tourism investment policies in October, and a dialogue on safety for tourists in November. The HCMC government will hold meetings every three months to discuss security situation with travel firms. 

Seminars on developing specific tourism products for the city and tourism promotion will be organized this month.

The municipal government and the HCMC Tourism Association will quarterly carry out promotional programs and cooperate with tour operators and other localities to organize tourism promotion activities in foreign countries.  In 2018, these programs and events will be organized more frequently than in 2017.

The most noticeable point of the agreement is that the city’s government will assign specific tasks to relevant agencies.

Particularly, the HCMC Department of Tourism has been assigned to work with related agencies and media partners to organize activities included in the agreement and report the outcomes to the authorities.

The HCMC Tax Department is responsible for organizing the dialogue on tax policies, while the departments of science and technology, tourism, planning and investment, and industry and trade are responsible for other specialized programs.

According to the city’s vice chairman Tran Vinh Tuyen, revenue from tourism accounts for 11% of the city’s gross regional domestic product (GRDP).

The city is taking measures, such as cooperating with related associations to support travel firms, to raise tourism revenue’s contribution to GRDP to 20% in the coming years.

Tuyen said the city will host a meeting to review the agreement’s outcomes and efficiency after six months. If the agreement does not gain specific achievements, related parties will have discussions to find out the reasons as well as solutions. 

Tuyen also asked the HCMC Department of Industry and Trade to cooperate with Vietnam Airlines, supermarkets and commercial centers to launch the Promotional Products Week late this year.

Meanwhile, the HCMC Departments of Home Affairs and Foreign Affairs have been assigned to hire foreign tourism experts to train the city’s tourism staffs. 

Data of the HCMC government shows that the city attracted 4.2 million foreign tourists in the first nine months of 2017, up 16.6% compared to the same period last year. Tourism revenue reached over VND84.5 trillion (about US$3.72 billion), up 10% year-on-year.

The city expects six million international arrivals in 2017.

Tourism growth goal assigned by Gov’t within reach

The tourism sector may possibly realize this year’s tourism growth rate of 30% as assigned by the Government, according to Nguyen Van Tuan, Director General of the National Administration of Tourism.

Statistics showed Viet Nam welcomed over 9.44 million of foreign arrivals in the first nine months of 2017, up 28.4% against the same period last year and meeting 73% of the year target.

The Government last June identified tourism as one of the key driving forces to ensure the overall growth goal of 6.7% this year after the economy only expanded 5.15% and 6.28% in the first two quarters.

Specifically, the Government tasked the tourism sector to achieve growth pace of 30% against 2016 while agriculture, industrial production, construction, and service sectors must obtain growth rates of 3.05%, 7.91%, 10%, and 7.19%, respectively.

Last year, the country lured over 10 million foreign tourists with China, the Republic of Korea, Japan, Chinese Taipei as the key source markets, accounting up to 54% of the total foreign arrivals.

Gov’t to build safe and fair environment for private economy development

The Government will focus on improving legal framework to build a safe environment for private businesses to compete fairly and healthily, according to its latest action plan.

The action plan was issued to guide the implementation of the Resolution No. 10-NQ/TW, adopted by the 12th Party Central Committee at its 5th plenum on June 3, 2017, on the development of the private economy into an important driving force of the economy.

The Government tasked inferior levels to review and propose cutting business conditions and administrative procedures by as much as half and expand private sector’s access to infrastructure and resources, the action plan writes.

The private sector has grown strongly with the GDP share of 39-40% and absorbed about 85% of the 1.3-1.4 million new labor market entrants each year.

Viet Nam currently has around 610,000 private firms but a majority of the registered enterprises are micro-sized with 70% of them employing less than 10 workers and having a registered capital of below US$221.

According to World Bank Group President Jim Yong Kim, Viet Nam’s future economic success will depend on allocating capital and resources to their most efficient and productive use.

He believed that one important strategy for resuming rapid growth is to create the right conditions to ensure that the private sector is an engine of innovation and hence productivity and efficiency.

If full power and creativity of the private sector are unleashed, Viet Nam’s successes will only grow, and millions of people will have a better chance of getting good jobs and sharing in the country’s growing prosperity, he said.

Second turbine of Vinh Tan 4 thermal power plant starts operation

The second turbine of the Vinh Tan 4 thermal power plant began generating electricity for the national grid on October 3, nearly three months after the operation of the first one.

The Vinh Tan thermal power plant project, invested by the Electricity of Viet Nam (EVN) group is one of the five thermal power plants of the Vinh Tan Power Station in the southern province of Binh Thuan.

The plant has two turbines with a combined capacity of 1,200 MW and was built at a cost of VND36 trillion (US$1.58 billion).

In full operation, it is expected to generate about 7.2 billion kWh each year. It is the first large-scale coal-fueled thermal power plant in Viet Nam using the supercritical steam generator.

The plant is also hoped to contribute to socio-economic development in the South Central Region and raise the stability and economic operation of the national grid.

Banks face charter capital difficulties

State-owned banks are finding it more difficult to increase charter capital, especially when they still have to pay dividends instead of keeping the money for this purpose.

It is estimated that the State budget will get an additional nearly 6.1 trillion VND (268.7 million USD) from the dividend payout of three State-owned banks – VietinBank, Vietcombank and BIDV – by the end of October this year.

VietinBank recently announced it will pay cash dividend to shareholders for 2016. The payment rate will be 7 percent, meaning that for each share, shareholders will receive 700 VND on one share holding. At this rate, the bank will pay dividend worth 2.6 trillion VND for 3.72 billion shares held by the stakeholders.

Of the total dividend, State capital representative State Bank of Vietnam, which holds 64.46 percent of VietinBank’s charter capital as of June 30, 2017, will receive 1.68 trillion VND. Bank of Tokyo-Mitsubishi UFJ, VietinBank’s strategic investor, will get 514 billion VND, thanks to its ownership of 19.73 percent of VietinBank’s charter capital. 

Previously, Vietcombank’s board of directors also approved to make an 8 percent dividend payout on October 16. The bank will pay shareholders 800 VND per share. With nearly 3.6 billion shares listed on the HCM Stock Exchange, the value of the dividend payout will reach nearly 2.9 trillion VND.

SBV is also the largest shareholder of Vietcombank, owning more than 2.77 billion shares, or 77.1 percent of the bank’s charter capital. The second-largest shareholder is Japanese Mizuho Bank Ltd, which owns nearly 540 million shares, or 15 percent of the bank, while other shareholders own total 7.89 percent of the bank’s capital. Thus, the State will receive more than 2.2 trillion VND from Vietcombank once the bank completes its dividend payout while Mizuho Bank Ltd will collect 431.7 billion VND.

With these dividend payout plans, the three banks will contribute nearly 6.1 trillion VND to the State budget this year. However, the banks will face difficulties as they cannot keep the money to increase charter capital to meet BASEL II standards as regulated by the central bank. According to statistics, the capital adequacy ratio (CAR) of the three banks is at 9 percent; however, the ratio will drop to below 8 percent if BASEL II is applied in the country by 2020.

Besides, following the first half of this year, all three banks had total assets exceeding 1 quadrillion VND. The rapid increase in assets means the banks have to increase ownership equity quickly to ensure CAR does not fall below the safety margin.Therefore, if the group of banks fails to increase capital, it will result in a strong negative impact on the credit growth plan of the group as well as the credit expansion of the whole banking sector, according to an SBV official who declined to be named.

In fact, the three banks have tried to increase capital in the past but failed. Vietcombank could not sell more than 7 percent of its capital to foreign counterparts due to the high market prices, even as investors buying large lots always want cheap prices. BIDV also failed to find a partner to sell up to 30 percent of its stake as scheduled while VietinBank has not yet completed its merger with PG Bank due to certain issues, including swap rates.

This year, BIDV and Vietcombank also approved capital increasing plans of 13 percent and 10 percent to 38.63 trillion VND and 39.57 trillion VND, respectively, at their annual general meetings. However, so far, no further information on the issue has been published.

According to experts, banks find it difficult to find additional capital sources, especially in the context that foreign investors are not too keen on contributing capital to do business with Vietnamese banks as they can do business on their own in the form of branches or wholly-foreign owned subsidiaries. Besides this, the Government is also urging State-owned groups and corporations to accelerate the withdrawal of capital from the banking sector. Therefore, banks will face more challenges to increase the capital as they still have to pay dividend.

VNA/VNS/VOV/SGT/SGGP/TT/TN/Dantri/VNEVET