HCMC property outstanding loans down by 8.88%

As of end-July, the outstanding loans for property in the HCMC-based banks were some VND89.5 trillion, or a drop by 8.88% against late last year, said the State Bank of Vietnam.

In particular, the outstanding short-term loans totaled VND14 trillion, down by 40%, and VND75.5 trillion for long term ones, up by 0.86% over late 2010. The property outstanding loans is currently account for 11.96% of the total outstanding loans.

According to the central bank, to adjust down the property outstanding loan ratio, credit institutions in the city must restrict lending activities and recollect short-term property debts. Therefore, the majority of outstanding loans are now mid- and long-term loans, which are hard to pull down because of the long-term contracts.

In breakdown according to lending purposes, 16.36% of the outstanding loans, equivalent to some VND14.65 trillion, is for construction of business facilities and 2.7% is for export processing and industrial zones, worth some VND2.4 trillion.

The ratio of bad debts on total outstanding loans for the property segment has risen to 3.8%.

Regarding bad debts in general, the banks in HCMC had their bad debts ratio at 4.57% of the total outstanding loans as of July 30, in which the figure for State-owned banks was 6.38%, shareholding banks 6.75%, foreign invested banks 0.99% and non-banking institutions 24.76%.

Singapore company seeks to expand Vung Ang Port

Freight Link Capital based out of Singapore has submitted a US$114 million investment proposal to the Ministry of Transport to construct two additional wharfs at the Vung Ang Port area of the Ky Anh district in the central province of Ha Tinh.

As proposed the wharfs would be operated by a 100% foreign owned entity. The venture to alleviate the overcrowded port has already been given the green light by the management board of the Vung Ang Economic Zone.

Once constructed the two wharfs would span a total length of 500m capable of handling vessels of up to 50,000 DWT with the added capacity to service cargo and containers for not only the Formosa Ha Tinh Steel Complex but the entire region.  

Li Weimin, Freight Links Capital President said the two additional wharfs are needed to meet the future projected demand for unloading cargo, machinery and equipment and clear congestion due to increasing cargo volumes.

Ariston launches new energy saving products

Ariston Thermo Vietnam Company Ltd on Friday started marketing its new energy saving heating products on the market where the Italian brand considers as the most important country in Asia.

Michele Morichi, country manager of Ariston Thermo Vietnam, told the Daily at the launching event held at the hotel Sheraton Saigon in downtown HCMC that the new SS Series products and Heat Pump water heater would be a chance for the company to affirm its leadership in the sector in Vietnam.

Morichi described the SS Series products as an innovative technology drive that can help protect users from bacteria and algae build-up and inhibit bacterial growth. The new technology releases active Ag+ Ion into the water tank through a special cartridge for hygienic water.

Meanwhile, the Heat Pump water heater using environmental air as a renewable resource allows consumers to maximize energy saving capability and save up to 70% of electricity consumption.

Talking about the company’s business performance, the country manager said Vietnam remained the key market with a strong business development, becoming the most important country for the company.

The Italian brand has entered Vietnam market for 20 years, and set up a plant in the northern province of Bac Ninh in 2004.

Heating products from the plant not only serve the local market but are also for export to other countries, Morichi said, adding the company plans to further invest in the country.

A market research done by Nielsen Company in 2010 shows that the Italian brand holds  a 73% market share in storage water heater category in Vietnam.

Ministry approves new location for Vung Tau Airport

The Ministry of Transport has agreed on a new location for the airport in Vung Tau in response to a recent suggestion of local government as part of its zoning plan to expand the southern city, according to the Civil Aviation Administration of Vietnam (CAAV).

CAAV announced the ministry’s agreement last week after Transport Minister Dinh La Thang met with relevant agencies of Ba Ria-Vung Tau Province. The aviation authority has been told to ask the Ministry of Defense to seek approval of the Prime Minister for the new site of the Vung Tau Airport.

The existing airport in Vung Tau will be upgraded to handle both military flights and services for air taxi, chartered flights and those flights to oil facilities off Ba Ria-Vung Tau in line with a master zoning plan for Vietnam’s civil aviation development as endorsed by the Prime Minister in January 2009.

The current Vung Tau Airport has a 1,800-meter-long runway able to handle small-sized planes and helicopters. CAAV said this airport now served military flights and was not opened to civil services.

CAAV did not mention the new location for the Vung Tau Airport. However, the Ba Ria-Vung Tau government issued a document about two years ago to order its agencies to prepare a plan for the new site of Vung Tau Airport with a 2,000-meter-long runway in Long Son Commune.

In addition to the Vung Tau Airport, Ba Ria-Vung Tau is also home to Con Dao Airport off the coast of the province. Currently, Con Dao Airport under the management of Southern Airports Corp. (SAC) serves daily domestic flights to and from HCMC by Vietnam Air Service Co. (Vasco) under Vietnam Airlines Corp. and the country’s private carrier Air Mekong.

Located 185 kilometers from Vung Tau City and 230 kilometers from HCMC, Con Dao Airport on Con Son Island has a 1,830-meter-long, 30-meter-wide runway and a 9,270-square-meter parking area for ATR-72, Fokker and Bombardier CRJ-900 airplanes.

The airport’s two-storey terminal received 94,305 passengers on nearly 1,950 flights last year compared to more than 67,270 passengers and 1,310 flights respectively in 2009.

* The Ministry of Transport has backed a proposal by the Dong Nai People’s Committee to regard site clearance and compensation as a separate component of the Long Thanh Airport project to ensure scheduled tempo of the country’s biggest future international airport.

Deputy Transport Minister Pham Quy Tieu, who is also general director of CAAV, has been assigned to work with relevant agencies over components of the big-ticket airport so that this project would get off the ground in Long Thanh District by 2015 as planned.

Southern Airports Corp. as the project’s owner is currently working on a pre-feasibility study for the airport about 40 kilometers from the heart of HCMC. This project will need over US$6.74 billion, including US$696.5 million for site clearance and compensation.

Assoc. wants sugar price at VND18,000 a kilo next season

The Vietnam Sugarcane and Sugar Association estimates that the sugar price in the next harvest season will be VND18,000 per kilo, and it will intervene in case the price changes by 10%.

At its general meeting on Friday in HCMC, the association said the local sugar price was stable in the last three years, resulting in high income for sugarcane farmers and encouraging sugar mills to increase investment to expand sugarcane cultivation areas.

To prevent farmers to switch to rubber and cassava cultivation, the association called for efforts to maintain the sugar price at VND18,000 a kilo to ensure the price of sugarcane material not lower than VND1 million a ton. Therefore, sugarcane farmers would be encouraged to expand their cultivation area, or least not switch to other crops with higher economic value.

The sugar association said the illicit trade in sugar would remain a headache in the coming time due to its impact on local price but there has been no solution yet. It is predicted that in the upcoming years, the local sugar price will be unstable depending on the amount of smuggled sugar.

Besides, during sugar processing season from October to June, sugar mills often sell their produce immediately without storing for the market after the season. Therefore, sugar price often turns volatile between July and September.

Binh Dinh tourism lacks services to grow

Binh Dinh Province’s tourism agency on Friday launched its tourism promotion program in HCMC but travel firms said the province had poor tourism services and transportation infrastructure to attract tourists.

Nguyen Van Son, deputy director the provincial Department of Culture, Sports and Tourism, said he hoped to attract more tourists – especially from HCMC - by calling for tourism investments through this program.

HCMC-based tour operators wanted to take tourists to Binh Dinh as a new destination in the South-Central region besides ones in Binh Thuan or Khanh Hoa provinces. However, tourism in Binh Dinh could not grow due to poor services and inadequate transportation.

“Returning to Binh Dinh after ten years, I find nothing new except for some newly-built hotels. Tourists can go there either by train or by plane but with bad quality or in small planes,” said Le Quoc Thang from Le Thang Travel Co.

Currently, tourists can go to Binh Dinh by air with daily flights of Vietnam Airlines or Mekong Air, or by SQN train which stops at Quy Nhon Station and SE train alighting at Dieu Tri Station.

Pham Duc Hoa from Saigontourist Holding Co. said the biggest problem facing Binh Dinh tourism was bad transport service. The company saw a small number of travelers arriving in the province or just staying there for one night before departing for Danang or Hue cities.

There were about one million tourists coming to Binh Dinh last year including 75,000 foreigners, a year-on-year increase of some 22%. Around 35% of Vietnamese tourists to Binh Dinh were from HCMC.

There are currently one four 4-star, one 3-star, nine 2-star and 40 1-star hotels in the province while the tourist attractions are still limited to Quang Trung Museum and Ham Ho resort and few others.

Son of the tourism department said the province would try to remove the current impediments when new tourism projects are put into operation, including a 5-star resort worth US$125 million invested by a Russian company, and a 325-hectare resort named Vinh Hoi worth US$250 million.

Diana sells 95% stake to Thai firm

Unicharm Thailand Co. Ltd., a subsidiary of Japan-based Unicharm Corporation, has acquired VND34.2 million common shares, or 95% stake, in Diana Vietnam and has operated this joint stock company from August 25, the local firm said.

Do Anh Tu, CEO of Diana, said in a press release that Unicharm becoming a main shareholder of Diana would help the company with advanced technology, product development and export promotion through the global network of Unicharm.

Diana said the company has chartered capital of VND360 billion and total assets of VND1.425 trillion. In 2010, the company earned VND1.02 trillion in revenue.

Diana is known as a manufacturer and distributor of hygiene products in Vietnam, with the feminine care product Diana and the baby diaper Bobby as its two main brands, holding a large market share in Vietnam.

Meanwhile, Unicharm Corporation is a Japanese manufacturer of products for feminine and baby care, healthcare, cosmetics, industrial material and packages.

According to Nikkei newspaper, Unicharm has acquired the entire stake held by Diana’s founder family as well as the firm’s investment fund worth US$128 million, or VND2.66 trillion, in total.

M&A generates new capital source for developers

Merger and acquisition (M&A) activity is seen as a channel for developers in dire need of capital to move their projects forward without calling for financing from banks if the right partner can be found, said an executive officer of Savills Vietnam.

Neil MacGregor, deputy managing director of the property services provider, told the Vietnam Real Estate and Construction Investment Forum in Hanoi on Friday that the M&A activity opened up new opportunities for cash-strapped developers.

The local real estate market was critically short of capital and developers were therefore seeking new sources of finance, MacGregor said at the gathering hosted by the Ministry of Planning and Investment in the capital city.

There are a number of options open to developers who are in need of capital to continue their project construction, besides loans from banks. These include an outright sale of the project to a third party, seeking a joint venture partner, wholesales of residential units, or strata sales of retail and office space.

MacGregor also said many local developers continued to hold large areas of land and were able to sell development land to third parties in order to raise capital to finance the construction of other projects.

He however cited figures researched by the company, saying that merger and acquisition in real estate is witnessing a rapid growth worldwide, nearly 24% between 2009 and 2010. In Asia Pacific, deal value increased from US$12 billion to nearly US$23 billion in 2010.

In Vietnam, real estate was one of the most active sectors in 2010 in terms of both transaction quantity and transaction value, he said, adding that in these transactions, Vietnamese investors and developers are more and more active as buyers, not just foreign players with large capital capacity as previously.

There are a number of challenges such as an immature legal framework, low market transparency, complicated licensing procedures and differences in price expectations. Nevertheless, M&A deals remains happening.

MacGregor attributed the market trend to the lack of bank finance causing trouble for many in the real estate industry. However, seen from other angles, it creates opportunities for others, particularly those with cash.

As the local real estate market is now in a downturn, caused by constrained bank financing, it is expect to see many more mergers and acquisitions in the real estate sector over the next 12 months, he projected.

Savills Vietnam has brokered for some projects in the country. Last year, the company successfully brokered a number of real estate deals, with total transaction value exceeding US$100 million.

Bitexco’s second skyscraper project to kick off next month

Bitexco Group will start work on its second high-rise structure Ben Thanh Towers in HCMC’s center in late September after putting the city’s tallest building Bitexco Financial Tower into service last October.

The 55-floor Ben Thanh Towers project, having two towers and covering 8,600 square meters, is surrounded by Calmette, Le Thi Hong Gam, Pho Duc Chinh and Pham Ngu Lao streets in District 1.

The investor plans to spend some US$450 million building a complex of shopping space, Grade A offices, serviced luxury apartments for lease in this area with seven ground floors and five basements. The project is scheduled for completion in 2015.

The tower is designed with offices in the middle and hotel rooms on lower and upper floors. Ground floors will be used for commercial space, including meeting room, restaurant, bar, sporting hall. Meanwhile, serviced apartments for lease are placed in the other tower having 48 floors.

The occupancy rates of Bitexco Group’s first skyscraper are 35% and 50% for Grade A office and shopping space among a total area of 37,000 and 8,000 square meters respectively.

Besides these buildings, the group has plans to build another project in another area of 6.5 hectares in District 1 and surrounded by Nguyen Cu Trinh, Tran Dinh Xu, Nguyen Trai and Cong Quynh streets. This project will provide offices, apartments, commercial center, hospital, school and amusement facilities.

Toan Thinh Phat launches sales of villas in Dong Nai

Toan Thinh Phat Architecture-Investment-Construction Joint Stock Co. on Sunday started its second villa offer of The Pegasus Residence project in Long Binh Tan Ward, Bien Hoa City of Dong Nai Province after the first phase of the project is completed.

The project owner quoted prices of 124 villas at between VND1.95 billion and VND3.9 billion per unit. The villas vary in sizes, from 130 to 330 square meters each, including nine single and 115 semi-detached ones.

The Pegasus Residence project, worth VND300 billion in total investment capital, is constructed on a 6.6-hectare area. A quarter of the area is for house building, and the remainder is for greenery and other public services facilities like park, restaurant, swimming pool, tennis court and boat station.

Up to 68 villas have been completed in the first phase of the project and were handed to buyers in March this year.

Ngo Vi Hung, general director of Sai Gon Thuong Tin Real Estate Joint Stock Company, better known as Sacomreal and serving as the distributor of the project, said most of buyers in the first phase were local residents. The target buyers in the second phase are people from HCMC and specialists who are living and working in Dong Nai-based industrial zones, he added.

To create liquidity for the project, Toan Thinh Phat has joined hands with several banks to extend loans worth 70% of the value of the villa. In this second offer, saving books of VND50 million each are also given to villa buyers until September 27.

Hung said his firm is looking for customers living and working in Bien Hoa City to offer villa leasing when their owners are not in need of using. Currently, 20 villas of the project have been rented.

HSBC: Weaker dong spurs exports

HSBC Bank has suggested the central bank weaken the domestic currency and/or cut interest rates to make Vietnamese exports more competitive and discourage import growth.

In a report released on May 5, the bank said one of the central bank’s major arguments against depreciating the domestic currency has been an increased debt burden that would result from a weaker dong versus the U.S. dollar.

Vietnam’s external debt has risen to nearly US$70 billion by end-2013. However, most of the Government’s external debt is concessional by nature and almost half of the debt has interest rates below 1%.

External debt as a share of gross domestic product (GDP) has steadied below 40% of GDP and half of it is concessional, meaning that external debt sustainability is not a major concern for Vietnam as most of its debt can be rolled over, it said.

Furthermore, while a weaker dong poses a bigger burden on interest expense payments in the local currency, the amount is still rather small.

For example, Vietnam paid only US$0.5 billion in interest expense payments on its government external debt in 2013. Government domestic debt interest expense payments, however, reached US$2.3 billion, according to the Ministry of Finance.

Vietnam’s debt burden, both private and public, will likely rise further.

The bank said the appreciation of trade-weighted dong has reduced domestic-invested firms’ price competitiveness and that weaker commodity prices add further to the woes.

The dong pegged to the greenback has appreciated not just against the euro and Japanese yen but also key competitors’ currencies. As contribution to export growth by the European Union (EU), Japan and ASEAN economies has declined, the stronger dong is hurting exporters’ profit.

“In the short term, we believe the strong trade-weighted dong is hurting the economy and there is scope for policymakers to support growth, either by lowering interest rates and/or depreciating the currency. This will make exports more attractive while dampening surging import demand, which has driven the trade deficit to US$3 billion,” the bank said.

To improve price competitiveness - boosting exports and curbing import demand, the short-term solution is obvious: weakening the currency via lowering interest rates and/or depreciating the currency, HSBC stressed.

There is plenty of room to do so as inflation remains subdued at 1% year-on-year in April. The average inflation rate is only 0.8% year-on-year in the first four months of the year.

Even with its forecast of rising inflationary pressure in the months ahead, HSBC said inflation will only reach as low as 3% by year-end.

Bitexco says loan still disbursed for The One project

Bitexco Group said the Vietnam Bank for Industry and Trade (VietinBank) is still disbursing a VND1.7 trillion loan for its major property project, The One, in downtown HCMC.

Vu Quang Bao, general director of Bitexco, told the Daily yesterday that construction work is still under way at the office-commercial-hotel project overlooking Ben Thanh Market.

In its Document 980/TB-TTCP on inspections at VietinBank in 2009-2012 submitted to the Government earlier, the Government Inspectorate said it had found some irregularities at the bank in the period.

The Government Inspectorate then asked the Prime Minister to assign the central bank to supervise VietinBank’s funding for Bitexco as the developer of The One project had an outstanding loan of VND1.699 trillion as of December 31, 2012.

The inspectorate wanted the central bank to order VietinBank to review the project and loan recovery solutions.  

Bao said the nearly VND1.7 trillion is the outstanding loan recorded as of December 31, 2012 and the group has provided sufficient papers for this credit.

Bao stressed that VietinBank is disbursing the loan for The One and components of this project are being carried out as scheduled. The group plans to put the project into service in the middle of 2017.

In related news, the authority of District 1 early this year told Bitexco to pay site clearance compensation as the district handed over the cleared site to Bitexco to develop The One in December 2012.

According to District 1, Bitexco still owes compensation of around VND16.1 billion.

However, Bao said Bitexco has paid the VND16.1 billion. Bitexco is capable of mobilizing sufficient capital for the project worth up to US$500 million.

The One is being developed on around 8,600 square meters surrounded by Calmette, Le Thi Hong Gam, Pho Duc Chinh and Pham Ngu Lao streets. It is designed to have a tower of 55 floors and another of 48 floors.

 Once completed, The One will supply more than 31,800 square meters of retail space, 17,300 square meters of grade A+ office space, around 350 serviced apartments for lease and 250-room Ritz Carlton Hotel.

Savills Vietnam sets up advisory services unit

Savills Vietnam has announced that it has established an advisory services team grouping more than 30 specialists with diverse knowledge and expertise in Vietnam’s property market.

The team has members of international industry associations including the Royal Institute of Chartered Surveyors (RICS) as well as certified practising Valuers of the Ministry of Finance of Vietnam.

The team will provide a range of services including market research, development recommendations, demographic and feasibility studies, optimised land use planning as well as valuation and banking and corporate services.

Nguyen Thi Van Khanh, associate director of the company’s Advisory Services in HCMC, said in a statement that the establishment of Savills Advisory Services will enable the property service provider to serve clients more effectively, cater for the comprehensive demands of clients, from market research to valuation, and ensure maximization of their investments.

Troy Griffiths, deputy managing director of Savills Vietnam, said 2015 is a milestone for Savills Vietnam as it celebrates its 20th anniversary. The company continues to grow in this market.

“We will continue to pursue our diverse business strategy to ensure our market leading position,” Griffiths said. “The Advisory Services team has been formed to meet the demands of both domestic and international investors.”

Savills Vietnam has offices in Hanoi and HCMC. The company provides property services regarding residential sales, commercial and residential leasing, research & consultancy, valuation & feasibility study, banking and corporate services, investment brokerage and advisory, retail consultancy and leasing, property and asset management, among others.

ABBank has new general director

The board of directors at An Binh Commercial Bank (ABBank) has picked deputy general director Cu Anh Tuan as general director to succeed Pham Duy Hieu who has stepped down for personal reasons.

ABBank said on May 5 that it is awaiting approval from the State Bank of Vietnam for Tuan’s appointment.

The 43-year-old Tuan has been serving as deputy general director of ABBank since April 2014. He has been responsible for the fields of accounting-finance, legislation, capital-investment and individual customers.

Tuan used to hold key positions at Techcombank, State Capital Investment Corporation (SCIC), Fujitsu Vietnam Limited and Motorola Vietnam Telecommunications Company.

As of March 31, ABBank reported total assets of over VND60.88 trillion (US$2.8 billion), total outstanding loans of some VND39.38 trillion and deposits of nearly VND54.2 trillion. The bank posted pre-tax profit of VND93.25 billion in the first three months of this year.

This year, ABBank targets total assets of over VND71.1 trillion this year, up 6% versus 2014, and deposits of VND46.5 trillion, 2.4% higher than the previous year.

The bank plans to raise its chartered capital to VND5.32 trillion from around VND4.8 trillion last year and obtain pre-tax profit of VND300 billion, up 124.5% over last year.

Binh Dinh invalidates VND2.3-trillion urban area project

Binh Dinh Province has decided to scrap its ‘in principle’ approval for a new urban area project worth VND2.3 trillion (US$106.9 million) registered by Asia-Pacific Investment Joint Stock Company (API) as the firm has not executed the project as committed.

The central province gave the go-ahead to Nhon Phu new urban area in late 2011 and the project covers 24.35 hectares in Nhon Phu Ward in Quy Nhon City.

As the enterprise has delayed implementation of the project, the provincial government has decided to take it back and look for other investors with strong financial capacity to replace API.  

Real estate investor API has floated shares on the local stock exchange. The enterprise got the nod to develop Ban Thanh residential area project covering 4.7 hectares in An Nhon Township with a cost of VND280 billion.

A source told the Daily that API has yet to proceed with this project and might lose it in the coming time.

In the middle of last year, API had plans to form APEC Binh Dinh Investment Joint Stock Company to implement the projects in 2014-2018. This subsidiary was supposed to have chartered capital of VND100 billion, with a 99% stake held by API.

However, the Trade Promotion Center of Binh Dinh Province said the firm has not carried out the two property projects.

API plans to organize an annual general meeting on May 8 to seek approval of shareholders for 2015 revenue and pre-tax profit targets of VND265 billion and VND70 billion respectively. API’s revenue mainly comes from its operational realty projects.

SBV: State-run banks need higher chartered capital

State-run commercial banks, especially those majority owned by the State, are on the right track of restructuring but they need to increase chartered capital to improve their financial positions, according to the State Bank of Vietnam.

Presenting a report on the banking sector restructuring process in 2014 and the first quarter of 2015 to the Government, the central bank said State-owned banks have closely followed the restructuring plan for the 2011-2015 period.

State-run banks have been tasked to undergo internal restructuring while taking part in the process of restructuring other ailing banks. For example, VietinBank has given management support to GPBank and Ocean Bank whereas Vietcombank has assisted VNCB.

Besides, BIDV is proceeding with a merger deal with Mekong Housing Bank and PGBank will be merged into VietinBank.

Ending March, State-owned banks reported total chartered capital of over VND134 trillion (US$6.2 billion), or 30.56% of the banking sector’s total. They were all profitable.

Last year, State-run banks posted net profit of over VND18.2 trillion, or 76.1% of the network’s total. In the first quarter of 2015, the respective figures were VND7.9 trillion and 65%.

Besides, State-run banks handled over VND62 trillion worth of bad debts last year, or 43% of the total of the banking system. In the first two months of this year, they settled VND1.8 trillion of bad debts, or 22.67%.

However, some banks such as Agribank and BIDV still have limited financial capability. Even some cannot meet the capital adequacy ratio set by the central bank.

The agency said chartered capital increases at State-run banks are necessary.

But cutting State holdings at the banks after equitization is still a long way to go since those banks are needed to enforce monetary policy and stabilize the market.

Therefore, the central bank suggested the Government allow State-run lenders to raise chartered capital from incomes that they have not to pay to the State budget for three to five years. Moreover, banks can raise funds by issuing shares for strategic investors and existing shareholders.

The agency also proposed that banks could use State dividends to scale up their chartered capital to ensure the minimum State ownership is 65%.   

Firms outside IPs told to monitor wastewater discharges

Manufacturers and trading businesses outside industrial parks will have to install wastewater monitoring systems and report data to local departments of natural resources and environment if they discharge 1,000 cubic meters of wastewater a day or above.

The requirement is specified in a Government decree on waste and scrap management with effect from June 15 this year.

Cao Tung Son, deputy head of the HCMC environmental protection agency, told the Daily that the city is working on a scheme to require businesses discharging 1,000 cubic meters of wastewater a day or higher to set up automated monitoring systems as required by the new decree.

Son suggested the State fund installation of devices and cameras to inspect businesses and detect those sending wrong data to the HCMC environmental protection agency.

The agency plans to submit the scheme to the city government at the end of the third quarter.

The city will complete the installation of an integrated automated monitoring system in September to better manage treated wastewater at 15 export processing zones and industrial and hi-tech parks. The project has a total investment of around VND40 billion (US$1.8 million) funded by the city budget.

At present, around 100 businesses operate outside the industrial parks and discharge over 1,000 cubic meters of wastewater per day in HCMC as the city has relocated many pollution-causing facilities to industrial parks.

Dong Nai’s FDI tops yearly target

The southern province of Dong Nai reeled in 982 million USD in foreign direct investment (FDI) in January-April, surpassing its original 900 million USD target for this year.

Of 50 foreign-invested projects during the period, 28 are new businesses and the remainder have registered additional capital, mostly in the  

support industry, high technology, services and farming based in industrial parks, said Director of the provincial Department of Planning and Investment Bo Ngoc Thu.

The success is a result of much simplified administrative procedures, including the new “one-stop shop” mechanism.

As well as improving the business climate, Dong Nai has ramped up infrastructure in urban and industrial areas, including the National Highway 1, the Ho Chi Minh City – Long Thanh – Dau Giay expressway, and wastewater treatment plants in all industrial parks.

The province is home to a pool of qualified workers and transport facilities convenient for trade with southern metropolis Ho Chi Minh City.

Local authorities have been holding regular meetings with the business community to deal with any arising problems.

Ho Chi Minh City works to prevent goods smuggling

Ho Chi Minh City’s market management force has inspected 68 business and goods-contribution units since the beginning of May, seizing over 8,370 smuggled cigarette packets and 11 motorcycles.

Accordingly, a large number of outlets trading cigarettes without business registration certificates and regular documents and those with illicitly transported and traded cigarettes were discovered.

The force reportedly checked 36 enterprises and business establishments trading in imported goods without invoices, seizing over 9,100 units of products, mainly toys, bags, cell phones, textiles and motorcycle parts.

In Ben Thanh, Tan Binh and Binh Tay markets and a number of main transport routes, the force uncovered 8 cases of smuggled cosmetics, seizing 5,500 units of products.

Nguyen Van Bach, Deputy General Director of the municipal Market Management Department, said his agency will intensify inspections while implementing appropriate measures to swiftly detect smuggling.

As part of the city’s efforts to prevent smuggling, trade fraud and fake goods business, controls along transport routes throughout the city will receive increased attention, Bach stressed.

Bac Giang moves to increase provincial competitiveness

The northern province of Bac Giang is looking to raise its provincial competitiveness index (PCI) after ranking 41 st out of 63 provinces and cities in 2014 with 57.33 points.

Director of the local Department of Planning and Investment Trinh Huu Thang suggested the province clarify administrative procedures for investors and increase the responsibility of heads of offices to prevent corruption and gain investor confidence in order to increase the 2015 index and in years after.

The province will continue improving steering board operations in investment support and business development to ensure the board can swiftly assist enterprises.

Planning and budget documents along with legal documents will be regularly posted on provincial, city and district websites to provide easier access to information for investors, he said.

The provincial Department of Taxation was requested to uncover reasons behind the extensive time required to complete enterprise tax procedures to design relevant policies.

The PCI report considers a range of criteria, including land access for businesses, land use stability, transparency, an equal and competitive environment and legal support for firms.

Since 2005, the PCI survey has drawn the participation of nearly 80,600 private owned enterprises and 7,800 foreign enterprises.

Taiwanese investors eye Vietnamese market

An increasing interest in the Vietnamese market has been noticed among Taiwanese investors, Director General Berton B.C. Chiu of the Department of Investment Services under the Ministry of Economic Affairs, Taiwan (China) said to Dau Tu (Investment Review).

Those businessmen are paying particularly high attention to the local industries of agriculture, garment & textiles, IT and vehicular spare part, he noted.

Foreign apparel-making enterprises are eager to erect plants in Vietnam supplying high-quality products for domestic consumption and exporting them to Southeast Asian countries, China, Japan, the Republic of Korea and European nations.

The vehicular spare part sector is also ripe with potential as there is high demand in Vietnam and lowered taxes have been applied since the country joined the World Trade Organisation in 2007.

Meanwhile, following the Agreement on the Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area (CEPT/AFTA) taking effect in January 2014, Vietnam has cut tariffs on imported motorbikes and automobiles by 50 percent. The tax will be cut to zero percent in 2018.

Jack Lin, a representative of I-Mei Foods Co., Ltd, which owns several Taiwanese rice cake trademarks in Hanoi, stated that the robust  

Vietnamese economy and reduced taxes - a result of several free trade agreements – have created favourable conditions for his company to expand its operations in Vietnam.

The US and Taiwan-based Franz Collection Inc., a pottery producer, is seeking distribution partners in Vietnam to take advantage of the significantly lower tariffs imposed on imports, its representative Sara Huang revealed.

Considering this trend, Chiu suggested a Vietnam-Taiwan joint venture should be established for the mutual benefit of both nations.

Taiwan is the fourth largest investor in Vietnam, with 2,306 projects worth 27.43 billion USD employing 1.4 million workers. More than 80 percent of Taiwan’s total investment is concentrated in the production and agricultural sectors.

Japanese stationery provider to build third plant in Vietnam

Japan’s stationery supplier King Jim Co. Ltd plans to build its third plastic paper file factory in Vietnam by late 2016, the firm said.

The 9,000-square-metre plant is expected to be built at a cost of 700 million JPY (5.88 million USD) near the existing two in southern Binh Duong province.

In addition to facilities in Vietnam, King Jim also has a factory in Indonesia and has authorised a China-based company to produce 4 million products a year.

It is set to reduce the manufacturing of 3 million products in China when the new plant—capable of producing 14 million paper files a year—becomes operational.

A King Jim representative said Vietnam’s labour cost is one third of China’s, adding that the new factory will help improve its competitiveness.

In the Japanese market alone, paper file sales in 2014 rose by 20 percent from the previous year to 53 billion JPY (445.37 million USD), indicating a need for the company to expand its operations to meet domestic demand.-

Hanoi’s Me Linh district plans to become green urban hub

The Hanoi Department of Planning and Architecture has unveiled a 15-year (2016-2030) development master plan for Me Linh outlying district with a total investment of 220 trillion VND (10.37 billion USD).

Located in the north of Hanoi near Noi Bai International Airport, the district is envisaged becoming a green satellite city of the capital with 1,897ha dedicated to green belts and green corridors, 4,975ha to agriculture research and cultivation.

Deputy Chairman of the district's People's Committee Ha Huy Quang said the district's green urban development focus would balance the industrial orientation of neighbouring districts and towns.

Turning the district into a green city would also build on its inherent strengths and advantages as a well-established agriculture production centre with large potential for cultivation of flowers, vegetables and other produce, he said.

Situated right at the northwest gate of the capital, the district's agriculture produce will enjoy easy access to the largest market in the Red River Delta, he added.

Existing industrial complexes in the district will be redesigned to become more environmental friendly.

The official publication of the district's master plan is significant because it will provide businesses and residents with a guideline of future development that they can participate in.

With the new master plan being published, the district authorities, agencies, businesses and residents will be able to monitor its implementation and ensure that the district's development stays in the right direction, Quang said.

The district used to be a part of Vinh Phuc province and become a part of Hanoi in 2008.

Hai Phong attracts 14 new projects

Since the beginning of this year, economic zones and industrial parks in Hai Phong have attracted 14 new projects and seven others registered to increase capital, according to the Hai Phong Economic Zone Authority.

These include 11 foreign direct investment (FDI) new projects and six FDI ones registered additional capital with total investment of 204.4 million USD, Dau Tu (Vietnam Investment Review) quoted the source as saying.

Domestic enterprises invested in three new projects and adjusted capital for one project at a total cost of 432.5 billion VND, an increase of 42 percent compared to the same period last year.

Can Tho: Industrial production value climbs almost 8 percent

The Mekong Delta city of Can Tho has attained an industrial production value of nearly 27.7 trillion VND (1.3 billion USD), representing a 7.9 percent year-on-year escalation, said the municipal Department of Planning and Investment.

Of the industrial sectors, the processing industry grew by 8.4 percent while the electricity and water distribution industry posted growth of 23.7 percent.

The city’s production industry focuses on farm produce and aquaculture processing, garments, beverage production, wood processing and pharmaceuticals.

Bui Ngoc Vy, vice director of the municipal department, underscored that the industrial production rise in the city was spurred by high-quality products, market expansion and new project implementation.

As many as four new projects were lured to the city in the first four months of this year. Currently, the city is home to 218 valid projects with the total registered capital of 2 billion USD.

However, numerous challenges still exist for local businesses such as price competitiveness and trade tariffs, which hurt aquaculture and agriculture exports at the outset of the year.

In a bid to shoot up the competitiveness of domestic and export commodities, the city is proactively seeking new markets as well as pumping additional capital for enterprises to renovate technology, increase product quality and reduce prices.-

HCM City state budget collection surpasses goal

Ho Chi Minh City's state budget collection for the first four months of the year amounted to 98.146 trillion (4.51 billion USD), increasing by 9.63 percent year-on-year.

The sum satisfied 36.93 percent of the city's yearly target, according to the City's Finance Department.

Domestic collection amounted to 57.946 trillion (2.66 billion USD), collection from crude oil was 8.7 trillion VND (400.2 million USD), and collection from import - export activities was 31.5 trillion VND (1.44 billion USD).

The city's budgetary expenses for the first four months were 11.716 trillion VND (539 million USD).

Tuna export value likely to fall 5% in 2015

The Viet Nam Association of Seafood Producers and Exporters (Vasep) forecast that the export value of tuna will decrease by 5 per cent this year, bringing in an estimated US$123 million for the second quarter of the year.

Vasep predicted a drop in turnover because of a recent sharp decline of the world price of tuna, coming in below $1,000 per tonne. The global increase in tuna production, and the depreciation of the euro and Japanese yen against the US dollar are listed as causes.

Declining demand in major markets was also listed as a motivator of the price disturbance. However, unstable sources of raw tuna, was listed as the primary reason for falling tuna exports, Vasep said.

Unstable sources of raw tuna were the primary reason for falling tuna exports, Vasep said,

According to Vasep, tuna exports got off to a rocky start over the past three months dipping by 9 per cent to $104.3 million

Exports to the US, the leading importer of Vietnamese tuna, declined by 1.2 per cent, amounting to $38 million for the quarter. Exports to the EU –the second largest market – slipped more by 15.5 per cent to total $28.23 million. Shipments to Japan - the third largest market – was the most dramatic with a yearly decline of 43.2 per cent to only $4 million.

Experts had already predicted a rocky first half of this year for tuna since no signs of recovery in tuna consumption-demand and tax pressures on Vietnamese exporters remain high, especially in the major import markets of Japan, the US and the EU.

Vasep concluded that Viet Nam remained reliant on the import of half of its raw tuna, on which a temporary import tax rate of 10 to 24 per cent was levied. While the import tax rate on raw tuna was zero in several countries, taxes in general have undermined the competitiveness of Vietnamese tuna exporters, it noted.

According to Vasep, management and data collection on tuna exploitation remained weak and must be enhanced to meet the requirements of demanding importers.

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