Experts: Vietnam footwear firms need to step forward

Domestic firms in the leather and footwear industry lag far behind their foreign directed investment (FDI) peers as Vietnam cements its position as a leading world exporter in the sector, experts said.

Vietnam’s leather and footwear industry posted exports of 8.5 billion USD by July 15, a year-on-year increase of 10 percent, the General Department of Vietnam Customs has reported.

This figure makes Vietnam fourth largest footwear producer in the world in terms of volume, after China, India and Brazil, and the third largest exporter in terms of value after China and Italy.

However, foreign invested firms account for 81 percent of the export value and domestic firms account for the remaining, according to the Vietnam Leather, Footwear and Handbag Association (Lefaso).

Lefaso attributes the domination of FDI firms to their ability to expand capacity and build new factories as they prepare to benefit from tax breaks accorded by several Free Trade Agreements (FTA) that Vietnam has signed.

The association said domestic firms are constrained by capital shortage and market access, making it difficult for them to expand production and increase their competitiveness. On the other hand, FDI firms are able to build on already existing advantages of capital, experience, technological superiority and other factors.

A report in the online baohaiquan.vn (Customs Newspaper) cited experts as saying Vietnamese footwear enterprises have the opportunity to get new orders because China continues cutting investment incentives for textiles and footwear sectors to focus on hi-tech sectors.

However, with the situation tilted strongly towards FDI enterprises, domestic firms must bring in drastic changes to improve their position by strengthening information linkages, joining associations as well as promotion initiatives of ministries and other agencies.

Lefaso Secretary General Phan Thi Thanh Xuan said the staff of domestic enterprise should be trained to be proactive in marketing and accessing information and to respond quickly to orders, instead of passively waiting for customers to find them.

Moreover, increasing investment by FDI enterprises should be seen as an opportunity for domestic firms to learn from the former’s experiences. Domestic firms should also consider cooperating with FDI firms to get orders, Xuan said.

The report on baohaiquan.vn also said that domestic enterprises want the Government to support them through the creation of legal corridors, mechanisms and policies to facilitate their operations.

For instance, they need preferential policies on credit, taxes and labour so that they can reduce operational costs and become more competitive, the report said.-

Thai trade fair in mid-August

The Top Thai Brands 2017 trade fair will be held from August 17 to 20 at the Hà N?i International Exhibition Centre on the capital’s Tr?n Hung Ð?o Street.

The event is being organised by the Department of International Trade Promotion, Thailand’s Ministry of Commerce - Office of Commercial Affairs, the Thai Embassy in Hà N?i and Vi?t Nam National Trade Fair and Advertising Company (Vinexad).

This year’s event will include two days for business matching activities on August 17 and 18. One hundred and thirteen companies and business associations from Thailand will be presented at the event to meet Vietnamese companies.

The days aim to boost trade promotion and help businessmen meet directly to introduce products and services from Thailand.

For the public days, which take place on the weekend, 192 booths of Thai companies and their agents in Vi?t Nam will exhibit products and services from Thailand, including food and beverages, household products, baby products, fashion products, electronic appliances, automotive products, health care and beauty products, and trade services.

VN to improve competitiveness of major export products by 2020

Vi?t Nam will improve the competitiveness of major export products to boost export value in line with the country’s economic restructuring and renovation of the growth model, according to a decision recently issued by the Prime Minister.

Under Decision 1137/QÐ-TTg to approve the project of improving competitiveness of Vietnamese export products by 2020 with a vision to 2030, Vi?t Nam plans to increase export value in 2020 to triple that of 2010, gain a trade balance in 2020 and achieve trade surplus in the 2021-30 period.

Accordingly, by 2020, the project would focus on increasing the quality and value of productsthat are advantageous for export to reach an average export revenue growth of 8 per cent per year during the 2016-20 period.

Exports of major agriculture and fishery products are planned to increase on average by 20 per cent and would be promoted in developed countries such as the European Union, Japan and Korea.

The project also targets to enable Vietnamese firms to participate in the global supply chain in several stages of high added value.

From 2021 to 2030, export growth is expected to reach 9-10 per cent per year. In addition, Vi?t Nam will have highly-competitive firms in each export product category.

The project will focus on two product categories with advantages for export, including agriculture and fishery, and processing industry products.

Products which will be in focus by 2020 include rice, coffee, rubber and fishery, as well as pepper, cashew, cassava, fruits and vegetables, along with garment and textile, footwear, wood products and handbags, in addition to umbrella, phones and components, computers and parts, cameras, transportation means, machinery and electric wires.

During the 2021-30 period, products to be improved in terms of competitiveness include tea, honey, raw materials of the garment and footwear sector, and plastics, as well as fertilisers and chemicals.

To achieve the goals, transforming production methods towards increasing the proportion of high value-added products is critical.

In addition, the export markets must be expanded together with developing national brands, products brands and business brands, while enhancing national competitiveness to create favourable conditions for firms.

Ba Ria-Vung Tau houses new industrial park

The Da Bac Industrial Park will be built in Bau Dien hamlet, Da Bac commune, Chau Duc district, the southern province of Ba Ria-Vung Tau, specialising in various sectors. 

The sectors include assembly industry, consumer products, electricity production, construction materials, mechanics, pharmaceutical products, health equipment, food processing, logistics and warehouse services, among others. 

A meeting on the establishment of the industrial park was held in the province on August 7 under the chair of Nguyen Van Trinh, Chairman of the provincial People’s Committee. 

The park, invested by Dong A Chau Duc JSC, has the first phase covering 295 ha and total investment capital of 530 billion VND (23.32 million USD). The project received a 50-year investment licence in 2015. 

As part of Vietnam’s industrial park development plan by 2020, the park includes 75 ha of the Da Bac industrial cluster licensed by Ba Ria-Vung Tau in 2014.

Vinamilk hoped to expand investment in Laos

Visiting Lao officials have expressed their hope that the Vietnam Dairy Products JSC Company (Vinamilk) will consider seeking opportunities to extend investment in and exports to Laos. 

Head of the Lao Party Central Committee’s Commission for Propaganda and Training and President of the Lao Academy of Social Science Kikeo Khaykhamphithoune expressed the hope while visiting the Vietnam Dairy Products JSC Company (Vinamilk) in the southern province of Binh Duong recently. 

Vinamilk Executive Director Bui Thi Huong briefed the Lao guests about the firm’s business operations, including exports. 

Lying on the site of 20ha at My Phuoc 2 industrial zone, Vinamilk’s Mega is the largest dairy manufacturing plant in the country. With a total cost of 2.4 trillion VND (104.3 million USD), it has a designed capacity of 1.2 million litres per day in the first stage. The figure will double to 2.4 million litres per day in the second stage. 

With a closed and automated production line, its manufacturing process meets GMP and stringent international standards on food quality and hygiene and environment protection. 

Vinamilk now boasts 13 farms across the country with cows imported from Australia, the US and New Zealand, which are the first in Southeast Asia to meet Global GAP practices. 

Its organic milch cow farm in the Central Highlands city of Da Lat, inaugurated in March 2017, is the first one in Vietnam to meet European organic standards certified by the Netherlands-based Control Union. 

Currently, Vinamilk has more than 120,000 cows, which produce some 750 tonnes of material milk for 3 million glasses of milk per day. 

The company plans to increase its herd of cows to 160,000 in 2017 and 200,000 in 2020. Its daily fresh milk output is estimated at 1,500 – 1,800 tonnes in the next three years. 

It also built a milk plant in Cambodia and holds 22.8 percent of stake in New Zealand’s Miraka Ltd and 100 percent of stake in the US’s Driftwood. It also opened an affiliate in Poland to serve as a gateway to Europe.

Jetstar Pacific to launch Dong Hoi – Chiang Mai flight

The low-cost Jetstar Pacific Airlines will launch the first flight from Dong Hoi, the central province of Quang Binh, to Chiang Mai province, Thailand, on August 11, according to the provincial Tourism Department on August 7. 

The service will operate two weekly flights on Monday and Friday, using Airbus A320 with 180 seats and lasting one hour and 40 minutes. 

On July 20, Jetstar Pacific sold fares on the website www.jetstar.com and at ticket agents, costing at least 410,000 VND one-way, exclusive of taxes, fees and promotions. 

Dang Dong Ha, Deputy Director of the provincial Tourism Department, said it is the first international flight in Dong Hoi and the only service of Vietnam to Chiang Mai. 

According to him, Chiang Mai is the largest province in the north and the second largest tourism hub in Thailand with nearly 10 million visitors. It is also a transit to other ASEAN member states. 

Quang Binh is well-known for the world natural heritage Phong Nha -  Ke Bang National Park, limestone caves such as Phong Nha, Thien Duong, Son Doong, beautiful beaches and film studio of blockbuster “Kong: Skull Island”. 

The province is expected to be a film studio of Hollywood blockbusters in the near future. It is also home to relic and cultural sites and the last resting place of legendary General Vo Nguyen Giap. 

Once launched, the route is expected to fuel economic and tourism development of Quang Binh in particular, and the two countries in general.

Vinamilk hoped to expand investment in Laos

Visiting Lao officials have expressed their hope that the Vietnam Dairy Products JSC Company (Vinamilk) will consider seeking opportunities to extend investment in and exports to Laos.

Head of the Lao Party Central Committee’s Commission for Propaganda and Training and President of the Lao Academy of Social Science Kikeo Khaykhamphithoune expressed the hope while visiting the Vietnam Dairy Products JSC Company (Vinamilk) in the southern province of Binh Duong recently. 

Vinamilk Executive Director Bui Thi Huong briefed the Lao guests about the firm’s business operations, including exports. 

Lying on the site of 20ha at My Phuoc 2 industrial zone, Vinamilk’s Mega is the largest dairy manufacturing plant in the country. With a total cost of 2.4 trillion VND (104.3 million USD), it has a designed capacity of 1.2 million litres per day in the first stage. The figure will double to 2.4 million litres per day in the second stage. 

With a closed and automated production line, its manufacturing process meets GMP and stringent international standards on food quality and hygiene and environment protection. 

Vinamilk now boasts 13 farms across the country with cows imported from Australia, the US and New Zealand, which are the first in Southeast Asia to meet Global GAP practices. 

Its organic milch cow farm in the Central Highlands city of Da Lat, inaugurated in March 2017, is the first one in Vietnam to meet European organic standards certified by the Netherlands-based Control Union. 

Currently, Vinamilk has more than 120,000 cows, which produce some 750 tonnes of material milk for 3 million glasses of milk per day. 

The company plans to increase its herd of cows to 160,000 in 2017 and 200,000 in 2020. Its daily fresh milk output is estimated at 1,500 – 1,800 tonnes in the next three years. 

It also built a milk plant in Cambodia and holds 22.8 percent of stake in New Zealand’s Miraka Ltd and 100 percent of stake in the US’s Driftwood. It also opened an affiliate in Poland to serve as a gateway to Europe.

Siam Cement rolls out joint venture with PetroVietnam

Thai based construction material conglomerate, Siam Cement Group, together with PetroVietnam have unveiled plans to joint venture a US$5.6 billion petrochemical complex.

The plant, the first of its kind in Vietnam, will be located 100km from Ho Chi Minh City in Dong Nai Province with SCG possessing a 71% equity interest and PetroVietnam holding the remaining 29%, reports DealStreet Asia.

Once placed in operation in early 2022, the Long Son Petrochemicals project will have capacity to develop a one-million-ton ethylene cracker that can produce up to 1.6 million tons of olefins annually.

Meanwhile, leaders of SCG met Monday, August 7, with the Dong Nai Province People’s Committee to discuss investment in infrastructure in the region such as airports and roadways that would be necessary for the petrochemical complex to operate effectively. 

Tiền Giang develops hi-tech agricultural park

The southern province of Tiền Giang will invest VNĐ1.2 trillion (US$52.8 million) to build a high-tech agricultural park on a 197ha area in Tam Hiệp, Long Định and Tân Lập 1 communes in the 2017-30 period.

This was stated by Lê Văn Hưởng, chairman of the People’s Committee.

In the first phase from 2017 to 2020, the province will develop technical infrastructure and call on enterprises to invest capital in their high-tech agricultural projects on a 44ha area in the park.

The phase needs total capital of VNĐ280 billion, including VNĐ21 billion from the provincial budget and the remaining from other resources, according to the provincial People’s Committee.

Meanwhile, during the second phase from 2021 until 2030, Tiền Giang will expand the park by 153ha with total investment of VNĐ924 billion. This capital will be used to complete technical infrastructure, the administrative centre and areas for research, transfering high agriculture technology, training human resources and other services.

The provincial Management Board of Industrial Zones will manage construction of the hi-tech industrial park in the first phase. The Management Board of the Tiền Giang Hi-tech Agricultural Park will be established in the second phase. Initially, Tiền Giang will give priority for completing construction of the infrastructure, especially a traffic system for the development of the park.

At the same time, the province will build a policy to attract investment for the park, creating efficiency in socio-economic development, and promote change in the provincial agro-economic structure.

Do free trade agreements really create prosperity in Vietnam?

A debate has raged for several decades about the real benefit of free trade agreements and whether they create prosperity for Vietnam, said experts from the Ministry of Industry and Trade at a forum late last month in Hanoi.

At least, with respect to the benefit received from the FTA between the Association of South East Asian Nations, Australia and New Zealand, the answer appears to be – not so much so far – said Phan Thi Dieu Linh of the Ministry.

Mr Linh, an expert from the Department of Asia-Pacific Market, said now that Vietnam has fulfilled most of its commitments under the Agreement the country is in an appropriate position to assess the contribution of the FTA to its wealth.

On February 27, 2009, ASEAN (Vietnam, Indonesia, Laos, Cambodia, Thailand, Philippines, Malaysia, Singapore, Myanmar and Brunei) signed its biggest trade pact with Australia and New Zealand.

Under the Agreement, Vietnam committed to allow 100% Australian invested entities to operate in the country in respect of higher education, adult education and other education services, including foreign language training and expand fields of study that Australian education providers may choose to provide.

It also reduced the experience requirement to three years for Australian teachers in Vietnam in the following education services – higher secondary education; technical and vocational secondary education; and foreign language training.

As it relates to road transport services, effective January 1, 2010, the Agreement allowed Australian joint venture stakeholders to increase their ownership interest from a noncontrolling 49% to a controlling 51%.

With respect to dairy products, Vietnam committed to progressively reduce tariffs on many Australian dairy products such as milk, butter, whey and yoghurt, by 5% every year, starting in 2010.

It was agreed that tariffs on milk, milk powder, butter and cheese would be eliminated in 2016 and 2017.

For live animals and meat, the tariff on exports to Vietnam was completely wiped out upon the agreement coming into force, which was January 1, 2010. Other Australian live animals exported to Vietnam were subject to 5% tariffs, which were to be abolished in 2016.

The tariffs of 20% on beef and 30% on pork from Australia were to be phased out initially by 15% and 25%, respectively, in the first year and by approximately 5% every year until they reached zero.

A similar scenario followed for Australian lamb, fruits and juices, with tariffs completely removed by 2016. Wine was an exception with the tariffs on Australian wine remaining at 80% and reduced in one fell swoop to 20% in 2022.

Nguyen Phuc Nam, deputy head of the Department of Asia-Pacific Market, continued to note that in 2009 exports from Vietnam to Australia were US$2.3 billion, which increased 126% to US$2.9 billion in 2016.

The relatively small increase of US$.6 billion in total sales speaks volumes and shows that at least at this point in time the Agreement has added little to the fortunes of the country in terms of exports and earnings.

At a 5% profit ratio, the total sales figure would equate to only meagre earnings of roughly US$30 million per annum— far off the mark that what was originally expected when the Agreement came into force.

The opportunity to improve the performance of the economy for exports has been missed so far, said Mr Nam: To date we have simply reduced barriers to the Australia and New Zealand markets and gained access but capitalized very little.

What we have learned is that when, as a country, we fail to properly structure our market-openings brought about by FTAs, we forego the major benefit from the negotiations and don’t enable the country to produce more, generate more sales and in turn earnings.

Consequently, we are forced to conclude that FTAs in and of themselves, like this Agreement, do little to boost the competitiveness of the country’s workforces and private sector in the export arena.

We need to learn from these lessons and do much more to close the gap between rhetoric and reality and ensure that the FTAs the government enters do in fact create prosperity that results in an improved standard of living for Vietnamese citizens.

Fibre & yarn exports rise in past 7 months

Fibre & yarn exports hit 750,000 tons, valued at more than US$1.85 billion in the first seven months of this year, up 17% in volume and 26.5% in value against the same period last year, according to the General Department of Vietnam Customs.

Fibres has been shipped to nearly 20 countries in the world, of which China was the lead importer, accounting for 54.4% of the total value.

In the first half of this year, 341,000 tons of fibres and yarns were exported with a value of US$933.4 million, up 18.5% in volume and 29.47% in value. The Republic of Korea came second after China with 68,400 tons or US$164.6 million (up 39.6% and 40.65%, respectively).  

Although Turkey was the third largest consumer of Vietnam fibres and yarns, exports to the market dipped sharply by 37.5% in volume to 30,000 tons and 28.3% in value to US$67.9 million.

Taiwan saw a sharp increase of 81.16% to 12,900 tons.

The Vietnam Cotton & Spinning Association said Turkey made up one-third of Vietnam’s fibre and yarn exports in the past, but after its anti-dumping duties were imposed in recent years, Vietnamese businesses have shifted their export targets to China and Pakistan.

Malaysia leading social media marketing company expansion to Vietnam

PersonEdge, one of Malaysia’s leading players in social media marketing, has opened its representative office in Vietnam which is located at The Manor Building, 91 Nguyen Huu Canh St, Binh Thanh District, Ho Chi Minh City.

The Vietnam office officially began operation as of August 1.

Choo Mei Sze, PersonEdge co-founder, said the company decided its expansion into Vietnam in the hope of contributing to the development of social media and marketing industries in the country.

Opening the Vietnam representative office is one of PersonEdge’ strategies, as Vietnam is a potential market in Asia with the number of smartphone users increasing sharply over the last five years, said Ms Mei Sze. The expansion will open the door for Malaysian and international brands to enter Vietnam, she added.

Pioneered and focused on strategic planning, managing and executing highly effective social media marketing plans for international and local brands, PersonEDGE has successfully made its presence known as one of the top social marketing agencies in Malaysia with major clients to boast such as SK II, Asus, Nivea, Dior and even global brands like LongChamp, Crocodile, Great Easten, and Nandos.

Vietnam Online Marketing Forums on way

New online marketing trends have come to Vietnam, Mr. Nguyen Huu Hung, CEO of Interspace Vietnam Co., told a press conference in Hanoi on August 7 introducing the Vietnam Online Marketing Forum.

These new trends will be discussed at the Vietnam Online Marketing Forum (VOMF 2017) on August 15 in Ho Chi Minh City and August 17 in Hanoi.

Trends include affiliate marketing trends and those in search engine marketing, programmatic marketing and multichannel marketing, mobile marketing, social marketing, content marketing, and other online marketing through email, livestream marketing, video marketing, and SMS marketing.

The goal of the forums is to promote the online marketing market in particular as well as Vietnam’s e-commerce sector in general and to help businesses approach new trends in online marketing.

The Vietnam E-commerce Association (VECOM) has announced the E-Business Index (EBI) for 2016, in which social network exceeded search tools to become the most popular online marketing method for enterprises (47 per cent).

Email continues to be a channel of interest to many businesses (36 per cent). Newspapers and newspaper ads are relatively stable, with rates of 34 per cent and 20 per cent, respectively. Television advertising is heading downwards and has stabilized at approximately 10-13 per cent.

Social networking is not only used the most but is also considered the most effective advertising channel nowadays. Forty-six per cent of businesses believe social media is highly effective.

Revenue from online advertising continues to grow significantly, according to VECOM. Many businesses, especially household and individual businesses, have taken advantage of online sales, which have contributed to growth in advertising on social media.

Famous online marketing brands such as Google and Facebook as well as foreign advertising companies are paying attention to the potential of online marketing in Vietnam.

The VOMF is expected to attract over 1,000 e-commerce enterprises and over 50 online marketing providers. The forums present opportunities for those in attendance to seek cooperation.

Speakers include reputable experts from leading organizations and businesses in the field of online marketing and research, including Nielsen, Google, Facebook, and comScore, among others.

Hyundai Engineering to build water plant at Long Son

South Korea’s Hyundai Engineering Co. has secured a $320 million order to build utility facilities at what will be the biggest petrochemical complex in Vietnam. 

The company announced on August 6 that it has signed a deal to build a water supply and treatment plant at the Long Son petrochemical complex in Ba Ria Vung Tau province, about 100 km southeast of Ho Chi Minh City. 

The project will be carried out on a turnkey basis, meaning Hyundai Engineering will be responsible for the entire construction, from design to test operations. The company estimates that construction will take 47 months after ground is broken. 

The plant will provide the industrial water and steam essential for the seamless operations of the petrochemical complex. A joint venture, which includes the Vietnam National Oil and Gas Group (PetroVietnam), has decided to invest $5.4 billion in building the petrochemical complex, which will be the largest of its kind in Vietnam once completed. 

The latest order is Hyundai Engineering’s second turnkey-based construction project in Vietnam, following the Ba Ria thermal power plant expansion project in 1999. It also designed the Mong Duong 1 coal-fired thermal power plant in northern Vietnam, which its sister company, the Hyundai Engineering and Construction Co., completed building last year.

PetroVietnam now holds a 29 per cent stake in the Long Son petrochemical project while Thailand’s Siam Cement Group (SCG) holds 71 per cent, after acquiring the entire 25 per cent interest previously held by Qatar Petroleum International (QPI) earlier this year for $36 million.

The two investors plan to borrow $3.2 billion out of the required $5.4 billion from financial institutions, with the remainder being self-financing.

SCG has pledged to provide a guarantee for the $3.2 billion package but it asked PetroVietnam to issue a commitment to Long Son Petrochemicals guaranteeing the 29 per cent portion of the $3.2 billion the Thai partner will borrow on its behalf.

Construction of the project cannot begin, however, as PetroVietnam is prohibited by law from providing a loan guarantee for the Long Son Petrochemicals Company, the investor in the project.

A State-owned enterprise is prohibited from providing loan guarantees for a subsidiary in which it holds less than 51 per cent. Though Long Son is classified as a key project in the oil and gas sector and thus falls under those that may receive government loan guarantees, the government has refused to provide such a guarantee for fears over mounting public debt, according to Mr. Nguyen Vu Truong Son, CEO of PetroVietnam.

“Construction could begin in August or September if this issue is cleared up,” Mr. Son said, adding that if things go smoothly, the project, which includes a 1 million ton ethylene cracker with a flexible gas and naphtha feed, allowing for an olefin capacity of up to 1.6 million tons per year, is expected to start in 2021.

Licensed in 2008, the complex was initially scheduled to commence construction in 2014 and begin commercial operations in 2017. It has faced several delays due to site clearance and the exit of QPI following a slump in global oil prices in 2014.

VOF becomes major shareholder in Tasco

The VinaCapital Vietnam Opportunity Fund (VOF), (LSE code VOF), VinaCapital’s flagship fund, has announced it has become a significant investor in the Tasco JSC (HNX code HUT), a leading toll road operator and real estate development company in northern Vietnam, via a private placement.

“The private placement gave us the opportunity to acquire a meaningful stake at an attractive price in a company that has a long track record of results and a strong pipeline,” Mr. Andy Ho, Chief Investment Officer at VinaCapital and Managing Director of VOF, said. “This investment is consistent with our philosophy of investing in companies that are focused on the growth of the local economy, and infrastructure improvement is a critical element in Vietnam’s ongoing development.”

Tasco’s private placement raised $23 million by issuing 21 per cent of post-investment common shares to several investors, including company management, with the largest acquirer being VOF, which invested $11 million. Tasco will use proceeds of the private placement to help finance future infrastructure and real estate projects.

Founded in 1971 under the name Nam Ha Bridge, the company later changed its name to Tasco JSC and listed on the Hanoi Stock Exchange (HNX) in 2008. Tasco’s main businesses include infrastructure construction and development and real estate development. Since its inception, Tasco has completed many infrastructure projects under the build-transfer (BT) and build-operate-transfer (BOT) models. The company currently has four toll road projects in operation and expects to bring another into operation this year. 

By number of projects owned, Tasco is one of the largest BOT and BT developers in northern Vietnam, with these projects valued at $220 million. Under the BT framework, Tasco can receive land in desirable locations in exchange for the value of the infrastructure it builds, and as a result it has significant holdings in prime locations in and around Hanoi. Revenue reached $124 million and net profit $18 million in 2016.

Founded in 2003, VinaCapital is a leading investment and asset management firm headquartered in Vietnam, with a diversified portfolio of $1.8 billion in assets under management. The firm has three closed-ended funds that trade on the London Stock Exchange: VOF, which trades on the Main Market, and VinaLand Limited and Vietnam Infrastructure Limited, which trade on the AIM. VinaCapital also manages the Forum One - VCG Partners Vietnam Fund, one of Vietnam’s largest open-ended UCITS-compliant funds, numerous segregated accounts, and two domestic funds.

Starbucks Ambassador Major Cohen visits Vietnam

Starbucks Vietnam hosted an interactive, coffee-inspired morning with Coffee Ambassador of Starbucks D.Major Cohen at their Starbucks Reserve Coffee Bar in Nha Tho Street, Hanoi, on August 8.

The meeting was an interesting session that unraveled the various secrets behind a perfect cup of coffee. From brewing methods to coffee tastings, coffee enthusiasts were taken on a journey to experience various international coffee flavors.

Major Cohen began his journey with Starbucks in 1995 as a part-time barista, part of a team opening a new store in suburban Boston when Starbucks was beginning its eastern US expansion and a year before it opened its first international store outside the US, in Tokyo. Over the next eight years, he progressed from barista to shift supervisor to store manager to learning specialist to district manager.

Enjoying active involvement in the specialty coffee industry since its inception in the late 1960’s, Major’s focus is telling the story of Starbucks coffee and culture. He is currently serving as a Starbucks Coffee Ambassador, engaging with customers with partners (employees) and the media cross Asia.

In his current role, he manages coffee and tea expertise and knowledge programs for the organization that create enthusiasm, instill pride, and lead education in Starbucks coffee and quality in order to improve partner performance and ensure customer satisfaction.

Major was a school teacher, art department head, local entrepreneur (as a smoked salmon importer and distributor) and worked as a commercial photographer in Boston for 19 years prior to joining Starbucks.

Since 1971, Starbucks Coffee has been committed to ethically sourcing and roasting high-quality Arabica coffee. It has reiterated that Asia continues to be a significant growth driver. It granted a subsidiary of Hong Kong Maxim’s Group, Coffee Concepts (Vietnam) Limited, a license agreement for Vietnam.

In late July, Starbucks Vietnam opened its first outlet in northern Hai Phong city, bringing the number in the country to 29. Starbucks Reserve Coffee Bar, which opened in Hanoi on May 5, was the first in Vietnam to bring customers closer to their coffee and Starbucks’ baristas than ever before.

PVN's 7M revenue exceeds plan by 14%

Oil production by the Vietnam Oil and Gas Group (PVN) reached 9.23 million tons in the first seven months of 2017, General Director Mr. Nguyen Vu Truong Son told Prime Minister Nguyen Xuan Phuc at a meeting in Hanoi on August 5. Gas and oil production have now reached and exceeded plans set for the first seven months.

Total revenue stood at VND278.5 trillion ($12.25 billion) in the first seven months, exceeding the plan by 14 per cent and representing 64 per cent of the annual plan.

After-tax profit was VND14.1 trillion ($620.2 million), representing 85 per cent of the annual plan. State budget contributions totaled VND50.8 billion ($2.23 million).

Of particular note, PVN discovered new gas fields, such as Herring (No. 11-12), and good wells such as Swan-3X and White Tiger-48.

It also put the White Rabbit oil well under exploration on May 7, 13 days earlier than the plan. Its science and technology activities have been actively deployed.

“Most production targets have exceeded plans by two to 19 per cent,” Mr. Son said. “All units are active as usual.”

Based on the results in the first seven months, PVN will now work towards exceeding the targets set for the year, he said.

Total revenue is expected to reach VND471 trillion ($20.7 billion) in 2017, exceeding the annual plan by 7.4 per cent, while State budget contributions are to reach VND89 trillion ($3.9 million), exceeding the annual plan by 20 per cent.

Mr. Son said that PVN will carefully monitor oil prices and adopt reasonable solutions to cope with fluctuations and will control and safely operate its oil and gas projects.

It will also boost investment in projects expected to be finalized this year and inspect and supervise all activities to reach set objectives and tasks.  

Prime Minister Phuc said that PVN has contributed to various sectors of Vietnam’s economy, in particular asserting national sovereignty and contributing to the State budget.

Fluctuating oil prices have been a global concern, causing falls in production and sales.

Under the management of the government and the Ministry of Industry and Trade and with efforts from PVN, the group has achieved positive results, according to the PM.

He added that the government will support PVN in developing sustainably so it contributes further to Vietnam’s economy in the future.

Savills: Foreign housing ownership stimulates market

It’s expected that foreigners buying houses would create the factors necessary to attract and stimulate the development of different types of real estate, which include investment, tourism, and services. This would benefit Vietnam’s economy and international practice and effectively be exporting local real estate, according to Mr. Nguyen Khanh Duy, Director of Housing Sales at Savills HCMC.

Amendments to the Law on Housing in 2015 that allow foreigners to buy homes in Vietnam is considered a positive change. In general, requirements have been regulated quite clearly and specifically, creating a new source of demand and promising to further promote the development of the local real estate market.

Legal procedures for foreigners to purchase real estate have received positive feedback from both vendors and buyers after nearly three years of implementation.

Savills said that only Ho Chi Minh City’s real estate market, however, has seen thousands of successful transactions with foreign customers over the last two years and many projects have reached the ceiling on foreign ownership this year shortly after sales opened.

“One project located in the prime location of District 2 opened for sale in the second stage, and the quota for foreigners of 30 per cent was quickly reached,” said Mr. Duy. “Foreign customers are mainly from Asia, such as South Korea, China, Taiwan, Hong Kong, and Singapore.”

According to Savills Vietnam, projects located in strategic locations such as District 1 and District 2, especially Thao Dien and Thu Thiem, and which have reputable investors are now receiving much interest from overseas customers and have very high absorption rates. Products attracting international buyers are mainly in the high-end segment and meet requirements regarding project quality, relevant services in consultation and sales, as well as leasing ability.

Mr. Duy added that the regulations that limit the number of apartments purchased by foreigners aim to minimize and prevent any negative impact on the economy and society. However, some 82,000 foreigners are currently living and working in Vietnam and there are more than 4 million overseas Vietnamese. Therefore, adjusting the limits to make them suitable for some types of real estate in certain areas with special needs, such as condominiums or Grade A apartments, is another direction that needs to be considered.

Many foreign customers have expressed an interest in the real estate market of major cities, especially Ho Chi Minh City, Hanoi, and Da Nang, but the number of red books issued to foreign organizations and individuals buying houses in Vietnam is low compared to customer interest and demand.

“Foreigners not knowing the legal procedures in Vietnam and some local administrations not being familiar with foreigners has been noted as a barrier,” Mr. Duy said.

The government recently met and discussed the draft Law on Special Administrative-Economic Units (special zones). The leasehold for home ownership for foreigners in Vietnam would be extended from 50 years to 99 years if the draft law was to be approved.

PM signs power savings directive

Prime Minister Nguyễn Xuân Phúc has signed an order designed to encourage power savings and ensure national power security, environmental protection and sustainable development.   

The circular emphasises the importance of power savings for the economy and provides recommendations for stakeholders, including governmental agencies and private firms. Among them is a recommendation for offices to issue  a regulation on using electronic appliances. 

Households are recommended to ensure their electrical appliances have high performance and energy seals.

In addition, the circular encourages people to practice energy savings by utilizing natural light and wind, using fans instead of air conditioners and turning off lights when not in use. 

The Ministry of Industry and Trade is campaigning through the media to promote power savings by citizens and initiate solutions to address energy shortages, especially in peak consumption hours.  

The Prime Minister’s order also requires ministers, deputy ministers and other leaders to circulate regulations and documents on effective use of power and tightening the management of electrical usage.  

A previous circular issued in January 2011 helped the country save 11,88 billion kWh and as much as VNĐ17,808 billion (US$780,000). 

DAP fertiliser prices rise sharply

Although the temporary safeguard tax on imported DAP fertiliser is effective from August 19, the market price of this product has already increased sharply by a range of VNĐ1.5 million-VNĐ1.9 million (US$66-84) per tonne.

Rising prices of DAP have led to an increase of VNĐ300,000-500,000 per tonne for NPK fertiliser, as DAP is the main material for producing NPK fertiliser, including Urea, DAP and Kali. NPK 20-20-15 has increased the most by VNĐ400,000-500,000 per tonne.

In addition, DAP is also the single major fertiliser for rice, fruit trees, vegetable crops and industrial crops. In particular, for soil contaminated with alum, DAP lowers the alum content to create soil for crops, therefore, farmers prefer DAP.

Last week, DAP prices at HCM City’s Trần Xuân Soạn fertiliser market fluctuated from VNĐ8 million to VNĐ12.5 million per tonnes. Domestic products of DAP – Đình Vũ Fertiliser Plant and DAP Fertiliser Plant Lào Cai – had the lowest prices, while the highest price was for Korean DAP product coded 18-46. 

MobiFone cooperates with iflix in online movie service

MobiFone Telecommunications Corporation (MobiFone) has announced its cooperation with iflix, a global online movie service provider, to offer online movie service for its customers.

From now to the end of this month, MobiFone subscribers registering for the iflix service can enjoy one free trial month. From September, users with data plans costing more than VND70,000 per month can get an extra 12 free months to watch iflix movies, equivalent to VND540,000 in subscription and data fees.

By registering for the iflix movie service, MobiFone customers can get free access to thousands of Hollywood and Asian movies, and international and domestic TV shows.

MobiFone users subscribing to the service will be able to use iflix on multiple devices like tablets, smartphones, laptops and computers.

Customers can also share their subscription plans with friends and family, and watch movies on two different devices at the same time. Moreover, users can download iflix movies to their devices and watch them offline later.

MobiFone is offering new data plans for iflix subscribers such as XP30, X30 and X4G for unlimited high-speed data at no extra fee. MobiFone is the first mobile carrier in Vietnam to cooperate with iflix to offer the service.

iflix is the copyright online movie service provider based in Malaysia. After eight other Asian countries, iflix (http://iflix.com) is now present in Vietnam.

Digiworld, German firm establish joint venture

Digiworld Joint Stock Company and German firm B2X on Friday struck a deal to form a 50:50 joint venture to provide customer care service for Samsung Vietnam.B2X Care Solutions Vietnam will allow B2X to enter the Vietnamese market and Digiworld to offer world-class customer care service to its clients.

The joint venture will provide service for users of all Samsung smartphones, tablets, TV sets and home appliances. Samsung is a leading producer of smartphones and electronic devices in Vietnam.

B2X Care Solutions Vietnam has a direct customer care center with 150 staff.

Digiworld is currently among the top three distributors in the information technology field and has more than 6,000 stores in the country.

Fuel price stabilization fund tapped but retail prices still up

Fuel retail prices increased by VND600 per liter and diesel oil rose by VND470 last Friday although the Ministries of Industry-Trade and Finance allowed trading firms to tap the fuel price stabilization fund.

The two ministries issued a joint decision permitting a domestic fuel price hike. A92 gasoline inched up to VND17,020 per liter while E5-A92 edged up by VND570 to VND16,810 per liter.

Diesel oil leapt to VND13,790 and kerosene grew by VND460 to VND12,390 per liter. Fuel import prices in the 15-day period from July 20 had risen compared to the 15 previous days.

The two ministries also allowed wholesalers to use the fuel price stabilization fund to prevent a bigger retail price spike. For A92 petrol and kerosene, they can get VND110 a liter, E5-A92 VND90 and diesel oil VND70.

On July 20, fuel prices rose by VND270-370 a liter due to an increase in global fuel prices.

Import turnover moves up 24 percent in seven months

Import turnover was estimated to reach US$118 billion in the first seven months this year, a year on year increase of 24 percent, reported the General Statistics Office of Vietnam (GSO).

Of the turnover, domestic sector reached $47 billion and foreign direct investment (FDI) companies hit $71 billion.

Some import items for local manufacturing highly increased. For instance, machines, equipment, tools and accessories surged 37 percent to $21.4 billion; electronic items, computers and components went up 27.4 percent to $19.2 billion; phone and parts hiked 30 percent to $7.3 billion.

China was still the largest import market of Vietnam with turnover reaching $31.7 billion, followed by South Korea with $27 billion and ASEAN nations with $16 billion.

Dong Nai records 700 million USD in trade surplus

The southern province of Dong Nai posted a trade surplus of 700 million USD in the first seven months of 2017, reported the provincial People’s Committee.

Dong Nai’s total export turnover in the January-July period reached 9.5 billion USD, a year-on-year rise of 13 percent.

Meanwhile, the province imported 8.8 billion USD worth of goods in the reviewed period.

Dong Nai mainly exported footwear, garments-textiles, wood and wooden products, electronic products, and farm produce. 

Its key markets included China, the Republic of Korea, Japan, the US and the European Union.

The province’s exports in the remaining months of this year are expected to continuously grow since businesses have signed deals until 2018.

Thai group wants to invest more in Dong Nai province

Thailand’s Siam City Cement Group wants to expand investment in the production and supply of construction materials and waste treatment in Vietnam’s southern province of Dong Nai.

Chief executive officer of the group Philippe Richart made the remark at a working session with the provincial People’s Committee in Dong Nai on August 8.

He noted that the group has invested in the Holcim cement plant in Nhon Trach district, and moves to expand the operation of this factory in the coming time.

Siam City Cement will invest in building an industrial dry mortar plant and a transit station for construction material in Dong Nai, he said.

It is also focusing on waste treatment, he said, adding that the group is using the latest technologies in this field.

Vice Chairman of the provincial People’s Committee Nguyen Quoc Hung cited a number of key projects being carried out in the locality such as the Ben Duc-Long Thanh, Dau Giay-Phan Thiet, Dau Giay-Da Lat expressways. The construction of Long Thanh airport will be launched in 2019. Therefore, the local demand for construction materials is extremely huge. 

Additionally, with over 26,000 active domestic businesses and 1,000 foreign investment projects, the province also needs investment in waste treatment, he said.

Local authorities will accompany businesses and support them to carry out environmentally-friendly and hi-tech projects, he affirmed.-

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