Development gap hinders linkages in APEC auto industry

A big development gap between APEC member economies is hindering the region’s auto industry from transferring technology and promoting linkages, said an official of the Vietnamese Ministry of Industry and Trade (MoIT).

Addressing the opening ceremony of the 26th APEC Automotive Dialogue (AD26) in Hanoi on May 11, Le Huu Phuc, Director of the MoIT’s Department of International Relations, said that APEC should give priority to assisting developing economies in boosting the auto industry.

He called for APEC member economies to cooperate effectively in capacity building to study auto industry policies, focusing on priority areas such as market access, human resources and infrastructure, technology incentives as well as environment standards for sustainable development.

Regarding the fourth industrial revolution, Phuc said it will lead to the restructuring of the global manufacturing system, not only in technology but also in management and placing of new business models.

New technology trends may disrupt value chains, possibly shifting a significant part of global production from developing to developed countries, he said, adding that access to end markets will likely become more critical than access to resources.

According to Phuc, with the fact that the auto industry’s annual growth of 4-6 percent largely due to the flow of FDI mostly within the APEC region, the improvement of the market and investment climate will continue to be the most important factor for the APEC auto industry.

AD 26 was held as part of the second APEC Senior Officials Meeting (SOM 2) and related meetings. At the dialogue, delegates discussed the real situation of the auto industry and auto market in APEC member economies as well as the impacts of free trade agreements (FTAs) on the regional auto industry.

In addition, the event also scrutinised policies and regulations on the auto industry, harmonisation of standards, future orientations and technology development trends of the industry.

The auto industry plays an essential role in APEC economies, manufacturing 60 million vehicles per year and directly employing 4 million workers.

According the MoIT, automakers in Vietnam turn out around 500,000 units a year and create 80,000 direct jobs. In 2016, the local industry recorded a growth of 29 percent and contributed nearly 3 percent of the country’s gross domestic product (GDP).

Collective economic sector develops toward quality in HCMC

Cooperative network has developed widely in HCMC’s 24 districts covering many fields with an increase in the number of profitable ones and reduction in the number of loss making cooperatives.

According to Vietnam Cooperative Alliance, the country now has 150,000 cooperative groups, 20,000 cooperatives and 50 cooperative unions with nearly 30 million members.

Of these, HCMC has 391 cooperatives, four unions and 3,528 groups in various fields covering commerce, services, transport, agriculture, handicraft, construction and people’s credit funds.

During ten years from 2002 to 2013, HCMC implemented the 9th Party Central Committee Resolution 5 and the HCMC Party Committee’s action program No.7 on developing collective economics, archiving positive results in both quality and quantity.

The ratio of efficiently operating cooperatives increased from 40 percent in 2001 to 70 percent in 2012. The number of loss making ones reduced from 37 percent to 12 percent.

Ms. Le Thi Hoang Yen, chairwoman of HCMC Cooperative Alliance said that the number of profitable cooperatives was up to near 80 percent last year with outstanding ones from commerce, transport and agriculture fields. Their operation scale and sizes have been expanding.

Cooperatives have joined hands together and with other businesses to develop production and trading, broaden market and increase capital size.

Many have been qualified and affordable for joining the city’s market, price subsidization program and members of the city Cooperative Alliance such as Phuoc An, Tien Phong and Phu Loc.

Accompanying missions from the HCMC People’s Council and People’s Committee to visit and work with many cooperatives at the end of 2016, Sai Gon Giai Phong Newspaper reporters saw cooperatives have been invested more scientifically and methodically.

Mr. Tran Van Thich, director of Phuoc An Agricultural Production and Service Cooperative, said that the cooperative was established in 2006 with only 15 members, VND111 million (US$4,883) in contribution capital and 13.5 hectares farming land.

In the early phase, the cooperative struggled to find consumption sources. So far, its chartered capital and members have reached to VND1.5 billion ($66,000) and 62 members. Production area has reached 25.3 hectares supplying about 6-7 tons of vegetables a day for the market.

The cooperative has own a cold storage able to accommodate four tons of vegetables and fruits, wastewater reservoir and treatment system, preliminary processing and packing facilities, four trucks, 14 net and glass houses with area from 500-1,000 square meters, spraying and lightning systems.

Revenue has risen swinging between VND16-18 billion a year. Last year profit approximated VND1.2 billion last year.

Phuoc An is only one out of ten cooperatives who have developed production in line with value chains to increase added value for products, find consumption sources and provide stable jobs for cooperative members.

They have contributed significantly to the new rural development program in the city.

Striving for 1.2 percent GRDP contribution rate

According to the city People’s Committee, besides the above achievements, the city has still faced difficulties and challenges in developing collective economics.

Most collectives are of small and medium sizes with little capital and low capital accumulation for reinvestment. Assistant policies have been implemented slowly without high efficiency.

The number of cadres specializing in collective economics management is limited. The HCMC Cooperative Alliance has not been strong enough to meet the consultancy and assistance demand of cooperatives.

Therefore, collective economics has contributed only 0.08 percent to the city Gross Regional Domestic Product (GRDP) in 2016.

In the phase of 2015-2020, the city will continue reforming, developing and improving the efficiency of the collective economic sector by fortifying and merging small and weak cooperatives.

Those not operating in line with cooperatives’ nature, principles toward their members’ benefit and under long lossmaking will be dissolved.

Besides the city will also call for more individuals, households and organizations to the sector to further contribute to the city’s economic growth and sustainable poverty reduction.

Deputy director of the Department of Industry and Trade Nguyen Ngoc Hoa said that collective economics has still been innovating to promote efficiency in the context of integration and market economy, improve the competitiveness of cooperatives as well as their products in the market.

That requires synchronous solutions from mechanisms, policies, capital to human resources. Of these the city should give the top priority to luring talents to develop the sector as expected.

HCMC has set a target of developing 1,500 cooperative groups, 175 cooperatives, 10 cooperative unions in the phase of 2015-2020.

The collective economic sector will post the growth rate of over 10 percent a year. Its contribution rate to the city’s gross regional domestic product will hit 1.2 percent.

The city will attract 50,000 workers to the sector. The ratio of cadres with bachelor degree in cooperative management to reach 40 percent, the remaining cadres must have college and intermediate degrees.

Doosan Vina exports cranes to India

Doosan Vina shipped three Rail Mounted Gantry Cranes (RMQC) to its Indian partner, BHARAT MUMBAI CONTAINER TERMINALS PRIVATE LIMITED (BMCTPL) on May 8.

This is the first shipment out of the total 12 RMQCs for the Indian company under a contract signed one year ago.

Yeon In Jung, Doosan Vina’s general director, said this is an achievement of not only the company but also Vietnam because RMQC is the largest among 68 ‘Made in Vietnam’ cranes produced by Doosan Vina. It is the highest crane in the world with the height of a 20-storey building.

 doosan vina exports cranes to india hinh 1 Each RMQC weighs 1,400 tons and is 84m high, 144m long, and 26m wide.

As planned, it takes three RMQCs two weeks to reach BMCTPL port in Jawaharlal Nehru Port, Mumbai, India from Doosan Vina port.

Since its establishment, Doosan Vina has exported 68 modern cranes for loading and unloading 30,000 ships.

G2B meeting set to facilitate growth

An upcoming G2B (Government to Business) conference will target creating favourable conditions for business growth, not merely on solving existing problems facing enterprises, a senior official has said.

Le Manh Ha, Vice Chairman of the Government Office, was addressing a press conference held on May 8 to announce details of the second annual meeting between the Prime Minister and businesses on May 17.

He said the conference will broadly focus on the promulgation and implementation of Resolution 35/NQ-CP, taking in suggestions and requests from business associations and individual firms about improving the business environment in Vietnam.

The inputs will be assessed and action by appropriate Government agencies under the PM’s guidance, he added.

Vu Tien Loc, President of the Vietnam Chamber of Commerce and Industry (VCCI), said at the press meet that his institution will submit to the PM around 200 opinions, divided into five groups, from businesses across the country.

He said the feedback largely dealt with administrative reforms, protection of corporate rights, and the need to reduce operational and production costs.

Two noteworthy requests from businesses are the streamlining of overlapping legal directives and administrative regulations, he said.

Businesses mainly want cheaper loans, easier access to credit, a transparent dispute settling mechanism, a transparent inspection regimen and logistical solutions, Loc said.

A majority of 420 requests sent by businesses to the 2016 conference have been resolved and the few remaining are being processed, he said.

Resolution 35 has been positively received by 75 percent of total national businesses, while about 30 percent considered the changes wrought to be limited.

Ha said that this year’s conference will reinforce the importance of the private sector as being on par with foreign direct investment and the State-owned sector.

Loc also said that in order to achieve the 2020 goal of establishing a million domestic enterprises, local authorities and firms will have to work closely together.

G2B meetings are seen as an effective way to increase understanding and communication between the two sides on many topics of shared interest, including market mechanisms, administrative regulations, legal documents and public sector divestment.

About 2,000 representatives of domestic enterprises, roughly four times that of 2016, are set to attend the upcoming conference. Of these, 1,500 belong to the household business sector, the FDI sector, State-owned and equitised enterprises, and representatives from foreign embassies and major financial institutions.

Senior leaders from 63 provinces and cities will attend the meeting via online streaming. The PM and Deputy PMs will monitor the conference, while the Government Office, the Ministry of Planning and Investment and the VCCI will chair the event.

This year’s G2B conference, themed “Side by side with Enterprises”, will be held at the Vietnam National Convention Centre.

Hanoi-Hai Phong Expressway investor grieves over lack of support

The investor in the Hanoi-Hai Phong Expressway, the Vietnam Infrastructure Development and Finance Investment JSC (VIDIFI), said they were incurring huge losses while the government support package is no where to be seen.

    

VIDIFI has submitted several complaints to the prime minister ahead of a upcoming conference between the prime minister and firms that will be held in May.

VIDIFI hopes that the authorities will help restructuring its foreign loans of USD300m, in which USD200m are from the Export-Import Bank of Korea and USD100m from the German KfW Development Bank, and provide the approved VND4trn (USD176m) support package for ground clearance.

In November 2016, the Ministry of Finance suggested that VIDIFI would only need to pay the interest while the loan would be paid by the state budget via the Ministry of Transport. However, the Ministry of Planning and Investment didn't agree, saying that many agencies were also having difficulties with foreign loans.

According to VIDIFI, most of the financial indicators are aligned with what was approved in financial plan by the prime minister. However, they haven't received the support package for ground clearance.

VIDIFI said their finance balance will be ruined if they don't have support in 2016-2020 period. Currently, they are collecting VND5.5bn (USD242,000) of toll charge a day but have to pay VND8bn in interest for banks. Even the Vietnam Development Bank will also be affected as most of its loans was given to VIDIFI.

VIDIFI had to borrow loans from Vietnam Development Bank to keep up with the schedule while the government support package hadn't arrived.

VIDIFI said several investors from India and consultancy firms from Australia had shown interests in the project. If the state support package do not arrive soon, not only it will affect the project but also the goal to attract more foreign firms to invest in the infrastructure, especially the north-south highway.

The 105-km expressway is a build, operate and transfer project and has a total investment of VND45.5trn (USD2bn). Last year, VIDIFI reported that they earned VND1.4trn but reported a pre-tax loss of VND1.7trn.

Hanoi-Haiphong Expressway is the most modern in Vietnam yet. It runs through four provinces and city including Hanoi, Hung Yen, Hai Duong and Hai Phong provinces. The toll charge is VND190,000 for a car with less than nine seats.

Door opened for Vietnam’s vegetable and fruit exports to UAE

The door is being opened for Vietnam's fruit and vegetable exports to the United Arab Emirates (UAE) after the country banned import of certain fruits and vegetables from five countries in the Middle East, announced the Ministry of Industry and Trade (MOIT) on May 8.

Accordingly, imports from Egypt, Oman, Jordan, Lebanon and Yemen would be stopped as of May 15, said UAE’s Ministry of Climate Change and Environment. The list includes all varieties of pepper from Egypt; peppers, cabbage, cauliflower, lettuce, squash, beans and aubergine from Jordan; apples from Lebanon; melons, carrots and watercress from Oman; and all types of fruit from Yemen.

The ban means higher prices for these products in UAE for a short-term due to the shortage of supply for upcoming Ramadan – the month of fasting, which will be observed at the end of May, the MOIT analysed.

At a time when the UAE Government is tightening its management on imported vegetables and fruits, the MOIT warned Vietnamese exporters to comply with the food safety standards of UAE, particularly regarding pesticide residue.

Due to its unfavourable weather condition for agricultural production, UAE depends on imported goods to a large extent in order to meet domestic demand. The country’s import volume of fruits and vegetables touched around US$3.2 billion, US$2.6 billion and US$2.5 billion in 2014, 2015 and 2016, respectively.

Meanwhile, statistics from the General Department of Vietnam Customs has shown that Vietnam’s export of these products to UAE in the same reviewed period stayed at only US$14.2 million, US$16.2 million and US$22.8 million, respectively.

Thanks to a series of activities held by the Vietnamese Embassy in UAE and businesses from the two countries to promote Vietnamese agricultural products, certain made-in-Vietnam fruits and vegetables — such as bananas, dragon fruits, rambutans, longans, litchis, mangosteen, mango, and guava — have found a place in a number of UAE’s supermarket systems and won the heart of customers.

Dung Quat refinery offer shares to 15 investment funds

Binh Son Refining and Petrochemical Company (BSR), the operator of Dung Quat Oil Refinery, has written to 15 domestic and foreign investment funds offering shares, Dan Tri news website reports.

BSR general director Tran Ngoc Nguyen said his company would launch their shares onto the market late this year.

Dung Quat is the first oil refinery in Vietnam invested and owned by the State, with a processing capacity of 6.5 million tons of crude oil a year, meeting only 30% of domestic demand for refined products and petrochemicals.

In 2015-2016, the total profit of BSR reached nearly US$500 million. The return on equity was 17%, and the State budget collection was US$2 billion in the form of taxes, surcharges and distributions of after-tax profits.

BSR is currently the investor of the Dung Quat Oil Refinery upgrade and expansion project with an aim of raising the annual capacity of the facility from 6.5 million to 8.5 million tons.

Concerning the plan for equitization of Dung Quat refinery, Bloomberg in late 2016 reported the refinery intended to launch its initial public offering (IPO) in the third quarter of the following year and was currently in the process of evaluation.

Giang said BSR had held talks with international companies, including one from the Middle East and several from Southeast Asia, over the sale of a 35% stake in the IPO. However, the identity of these companies was not disclosed.

“We are working very hard to prepare for the IPO next year. The exact timing and volume of this sale will depend on the market situation in the coming year,” Giang said.

With respect to the sale of shares, Gazprom Neft of Russia once showed interest in a 49% stake held by PVN in Dung Quat refinery and proposed a plan for expansion of the facility with a total investment of US$1.5-3 billion. However, after several years of negotiations, Gazprom Neft in June last year announced they had relinquished its intention to invest in Dung Quat.

Alexander Valeryevich Dyukov, chairman of Gazprom Neft, then explained his firm did not buy the 49% stake in Dung Quat from PVN because they did not feel satisfied with the conditions proposed by Vietnam.

Gazprom Neft’s abandoning the plan to acquire the 49% stake in Dung Quat has forced BSR to find another option to expand the plant.

A BSR leader revealed Vietnam would look for a US$1.2-billion foreign loan to invest in Dung Quat before its equitization in 2017.

As planned, when completed in 2021, after the expansion Dung Quat, the refinery will be able to address half of Vietnam’s fuel needs. Currently, the capacity of the facility is 148,000 barrels per day, meeting about a third of the demand at home.

Fuel imports from South Korea shoot up

Fuel imports from South Korea this year have more than doubled year-on-year to nearly one million tons, supported by low import tariffs, according to the General Department of Vietnam Customs.

Vietnam spent US$604.8 million importing some 986,500 tons of petrol from South Korea in the first four months of the year, up over 105% from the year-ago period.

A source from a southern fuel enterprise told the Daily that fuel imports from South Korea enjoy the most favorable tariffs given the ASEAN-Korea free trade agreement (AKFTA).

Domestic firms are subject to a tariff of 10% for fuel imports from South Korea, 10 percentage points lower than from many other markets. Meanwhile, the tariff on diesel is 0%, which is equal to other ASEAN countries but is five percentage points lower than other markets.

Fuel importers prefer oil products from the South Korean market to those of Dung Quat Oil Refinery, citing lower cost and plentiful supply.

The increase of fuel imports from South Korea also means that imports from other markets went down. Fuel imports from Malaysia and Singapore had dipped 25% and nearly 10% respectively in the year to April 30.

A report of the department showed that import prices of fuels increased sharply in the first four months of the year. The price since early year has averaged out at US$538.7 a ton, up 56% over the same period last year.

New real estate enterprises soar in January-April

The number of newly-established enterprises in the real estate sector in the first four months of 2017 increased sharply over the same period last year, according the Agency for Business Registration under the Ministry of Planning and Investment.

In January-April, the country had more than 1,390 newly-established real estate enterprises, up 66% year-on-year. Meanwhile, their registered capital increased about 50% over the same period last year.

Backed by the sharp growth of the real estate and construction markets, some companies in these sectors have announced higher profits in the first quarter.

Particularly, a financial report of Dat Xanh Real Estate Services and Construction Corporation (DXG) showed that the company’s net revenue in the first quarter reached VND586 billion, a year-on-year increase of 86%, while its after-tax profit shot up by 5.2 times to VND151.6 billion.

The company explained its higher quarterly profit came mainly from sales of LuxCity project and dividends from subsidiaries and joint ventures. This year, Dat Xanh targets net revenue of VND3,300 billion (about US$145.2 million) and after-tax profit of VND700 billion.

Meanwhile, Thu Duc Housing Development Corporation (TDH) posted net sales and service revenue of VND191.3 billion in the first quarter, up 152.9% against the same period last year, and net profit of VND41.5 billion, tripling the same period last year and fulfilling 32% of its 2017 target.

In the 2017 general meeting, Hoa Binh Construction and Real Estate Corporation (HBC) announced plans to achieve revenue of VND16 trillion and after-tax profit of VND828 billion. However, as of late March 2017, the total value of contracts won by HBC had amounted to VND39.6 trillion.

Meanwhile, Vietnam Construction and Import-Export Joint Stock Corporation (Vinaconex) said its net revenue in the first quarter was VND2,041 billion, up 65% year-on-year, and after-tax profit was VND148 billion, up 37% over the same period last year.

In their shareholder meetings for 2017, many large firms in the construction industry also announced plans to develop real estate projects.

According to real estate experts, the hefty growth of the real estate and construction industry, especially in major cities such as HCMC, has led to newly-registered enterprises in these sectors rising. However, the real estate market remains unpredictable, especially in HCMC and neighboring provinces such as Binh Duong and Dong Nai.

Dong Nai suggests HCMC help consume 10,000 pigs a day

Dong Nai Province is asking HCMC to help consume some 10,000 pigs a day from the neighboring province to ease the supply glut.

“If HCMC consumes 10,000 pigs from Dong Nai everyday, the province will be able to free up 300,000 pigs in the next month,” said Duong Minh Dung, director of the Department of Industry and Trade of Dong Nai Province, at a meeting with relevant agencies and enterprises from HCMC.

According to Dung, Dong Nai Province currently has a herd of about 1.8 million pigs, including 300,000 pigs of over 80 kilos. At present, the province provides 5,000-6,000 live pigs for HCMC a day.

However, most of the enterprises from HCMC said their slaughterhouses are operating at full capacity. Besides, the number of pigs traded at wholesale markets has also risen to a record high. Therefore, they cannot increase pig consumption to support Dong Nai.

Moreover, if the amount of pigs transported to HCMC increases, pork prices would even dip.

A representative of the HCMC Department of Agriculture and Rural Development said the demand for pork cannot surge overnight. Besides, an increase in pork sales would affect the consumption of other food products and a greater amount of pigs slaughtered will put pressure on the environment.

Nguyen Huynh Trang, deputy director of the HCMC Department of Industry and Trade, said that in order to support Dong Nai pig farmers, the city could boost sales campaigns at export processing zones and industrial zones and continue to encourage processing units to increase consumption.

In a longer term, Trang suggested Dong Nai review agriculture planning, invest in a variety of farm produce and reduce dependence on pig farming.

Draft decree opens door wider for rice exporters

A forthcoming decree replacing Decree 109 on rice trading and export may remove many regulations seen as barriers to the development of the rice industry, according to a draft released by the Ministry of Industry and Trade. The draft has heaped praise from rice exporters.

The draft abolishes Article 18 on criteria for registration of export contracts and Article 19 on the floor export price in Decree 109. With this, the rules on the floor price in rice export operations would no longer apply.

The new decree will also open the door for rice exporters by modifying rice export conditions in Paragraph 1 of Article 4 in a way that does not specify the size of storage and milling facilities. Instead, these establishments must meet the general standards promulgated by the Ministry of Agriculture and Rural Development, according to the draft.

Currently, rice exporters are required to have at least one specialized warehouse with a minimum storage capacity of 5,000 tons of rice, and at least one rice husking and milling plant with a minimum capacity of 10 tons per hour in line with the common standards set by the agriculture ministry.

Now, the draft only asks them to have a specialized facility for storing, husking and milling rice in line with the common standards defined by the agriculture ministry, satisfy food safety conditions and obtain a food safety certificate in accordance with the Law on Food Safety.

The draft orders rice exporters to have a material zone or to cooperate with rice producers in production and consumption, with a written approval by authorities in localities where these material zones are situated or where joint production and consumption take place.

For organic, parboiled and medicinal rice, traders are allowed to export unlimited quantities provided that they report on export contracts in accordance with general regulations. Export procedures are carried out at the customs office.

The draft nullifies the requirement for registration of export contracts with the Vietnam Food Association (VFA).

As per the draft, instead of registering rice export information with VFA, enterprises now need to make reports on their rice export contracts on the portal of Ministry of Industry and Trade at www.moit.gov.vn to facilitate the management of rice export operations. After all necessary information is provided, their rice export contract reports will be automatically transferred to the National Portal (vnsw.gov.vn) as the basis for the implementation of customs procedures according to the law.

While it is still unknown when the new decree will come out, certain rice exporters have thrown their support behind the draft rules.

Nguyen Van Hung, deputy director of rice exporter Eco Tiger specializing in producing and trading in organic rice, said his company has so far had to ship rice abroad via an intermediary company, which has caused numerous inconveniences, including confidential information about customers.

In addition, many companies have to export products via a third party, and due to complicated procedures, such companies have shunned potential markets such as the U.S.

“Now the draft decree allows traders to export organic rice without limits and requires no certificates on rice export eligibility… which is good news. We hope this will soon be realized,” he said.

Pham Thai Binh, director of Trung An Hi-Tech Agriculture Company, said the abolishment of the floor price in rice export contract is a right approach, which will surely help boost rice export.

In addition, registering rice export contracts with the Ministry of Industry and Trade via its portal is more convenient than registering with the Vietnam Food Association, he noted.

Non-healthcare enterprises look to open drugstores

Several enterprises active in other sectors than healthcare, including The Gioi Di Dong JSC and Digiworld JSC, have announced or planned to open pharmacies.

The Gioi Di Dong said it would invest in the drug retail sector by acquiring or joining forces with experienced medical enterprises to open 15 to 20 drugstores. There are several favorable conditions for the company to enter the pharmaceutical market since it currently has 1,300 electronics retail stores nationwide, a variety of technology applications, and experience in retail business.

Vietnamese people have become more health-conscious, so they are ready to spend more on healthcare. This is a chance for modern pharmaceutical retail chains to be expanded.

Dr. Truong Van Tuan, chairman of the HCMC Pharmacist Association and lecturer at the HCMC University of Medicine and Pharmacy, said in developed countries, drugstore chains account for 70-80% of total drug sales while this proportion in Vietnam is small. Countries in Europe, America, and Southeast Asian nations such as the Philippines have chains of thousands of drugstores, including multinational drugstore chains.

According to Tuan, there are currently some drugstore chains in HCMC such as Phano Pharmacy (60 stores), Medicare (45 stores), Pharmarcity (40 stores), Vistar (21 stores) and Eco (11 stores) among others.

Some of them are planning to expand their operations. Particularly, Pharmarcity looks to have 500 drugstores nationwide over five years while Eco plans to open 80 stores in the next three years.

Tuan said the pharmaceutical market will keep growing in the coming time and the Ministry of Health has promoted the development of modern drugstore chains in accordance with the nation’s healthcare regulations and market demand.

Alphanam to build Muong Hoa Cultural Park in Sapa

Recognizing the potential of Sapa as a travel destination for both foreign and local visitors, the Alphanam Group will build the Muong Hoa Cultural Park in the town with the aim of providing a place full of cultural sites, diverse activities, accommodation, and public facilities.

Its architecture will highlight the beautiful natural surroundings as well as the unique cultural heritage of Sapa’s Muong Hoa Valley.

According to the plan, Alphanam will invite two partners to jointly implement the 100-ha project: the DPA Singapore Designing Company and Marriott International Inc. The Cultural Park is expected to be completed before 2020.

It will be designed in harmony with nature, the local terrain, and the local community, and will provide visitors with unique experiences highlighting the history, cultural heritage, and human values of five ethnic minorities living in the valley.

At an elevation of about 1,500 meters (4,921 feet) above sea level, Sapa is known for its terraced rice fields and trekking trails. The harvest season in October is amazing for both sightseeing and trekking, with beautiful yellow rice paddy fields. It was recently listed in the Top 10 rising destinations in Asia in 2017, by popular travel website TripAdvisor.

The Muong Hoa Valley is about 14 km from Sapa is famed for its breathtaking scenery and is the largest rice-growing area locally. Treks are available along the Muong Hoa River, snaking through the valley and through mountains with strangely-carved stones.    

Operation of Cau Gie-Ninh Binh Expressway may be franchised

Vietnam Expressway Development and Investment Corp (VEC) has proposed to Ministry of Transport (MoT) a plan to franchise the rights to expressway operations of Cau Gie-Ninh Binh expressway, which is has never been precedent in Vietnam.  

VEC proposed MoT to submit the plan to the government for approval. As the plan, it is estimated that the Cau Gie-Ninh Binh expressway can be franchised O&M with value of VND9.2 trillion ($404.8 million).

Investors who keen on securing the rights to expressway operations must meet the following requirements: experienced on franchise projects; have the financial capacity and capable of operating expressway projects.

VEC targets to build 1,000 kilometers expressway, Mr. Mai Anh Tuan, CEO of VEC told local media. He also added that in order to achieve the target, VEC need to mobilize new investment capital. Therefore, plan to franchise the right of operation and maintenance of Cau Gie-Ninh Binh expressway is necessary.

Currently, there have been some foreign investors wishing to involve franchise the right to charge fee of Cau Gie - Ninh Binh expressway. Among them, France’s VINCI Group signed a cooperation agreement with VEC. However, the selection of investors will only be made after the franchise scheme for the Cau Gie - Ninh Binh expressway has been approved by the Prime Minister with feasible mechanisms.

Cau Gie - Ninh Binh expressway (phase 1) has 50 kilometers long invested by VEC by chartered capital and bond capital with a total investment capital of VND8.9 trillion ($391.6 million).

In addition, the VEC is also considering transfer rights to operation the Ho Chi Minh City - Long Thanh - Dau Giay expressway.

After the franchise, VEC and investors will jointly set up an enterprise to operating Cau Gie - Ninh Binh expressway. The proceeds from the franchise will be used to invest other VEC projects.

Cau Gie - Ninh Binh expressway was started in January 2006 with the investment of nearly VND9 trillion ($396 million). The 50-kilometers expressway of Cau Gie-Ninh Binh, with six lanes, i

The Vietnam Expressway Development and Investment Corp. (VEC) has sent a plan to the Ministry of Transport (MoT) on franchising the rights to operate and maintain the Cau Gie-Ninh Binh Expressway; a move without precedent in Vietnam. 

It proposed that MoT submit the plan to the government for approval. Operations and maintenance (O&M) for the expressway could be franchised under the plan for VND9.2 trillion ($404.8 million).

Investors keen on securing the rights must be experienced in franchise projects, have the financial capacity, and be capable of operating expressway projects.

VEC targets building 1,000 km of expressways in Vietnam, Mr. Mai Tuan Anh, CEO of VEC, told local media, and needs to mobilize new investment capital to do so, making the franchising plan a necessity.

A number of foreign investors expressed a desire to become involved in toll collections on the expressway, with France’s VINCI Group signing a cooperation agreement with VEC. The selection of investors will only be made after the franchise scheme has been approved by the Prime Minister and feasible mechanisms identified.

The Cau Gie-Ninh Binh Expressway (Phase 1) runs for 50 km and is invested by VEC with total investment capital of VND8.9 trillion ($391.6 million).

It is also considering transfer the rights to operating the Ho Chi Minh City-Long Thanh-Dau Giay Expressway.

If a franchise was arranged, VEC and the investors would jointly set up an enterprise to operate the expressway, with the proceeds used for investment in other VEC projects.

The expressway began in January 2006 with investment of nearly VND9 trillion ($396 million) and was the first of its kind in the Red Delta connecting Hanoi with provinces to the south.

VEC currently has six investment projects with total capital of VND135.4 trillion ($6 billion). Of the 600 km of expressways it is investing in, 350 km have been put into operation, representing half of all the expressways now in operation around the country.

Mr. Anh told local media that many foreign investors are keen on securing the rights to expressway operations in Vietnam.

VEC has established three companies to operate three expressways: Noi Bai-Lao Cai, Cau Gie-Ninh Binh, and Ho Chi Minh City-Long Thanh-Dau Giay.

Any sale of rights to operations will be conducted by selling shares in the three companies. “If investors want to buy all the shares then the State will sell all the shares,” Mr. Anh said.

The Eurosphere - European Art of Living Exhibition to launch in HCM City

     

HCM City will host the first ever Eurosphere – European Art of Living expo to be held in Southeast Asia in June, showcasing many European products.

To be organised by the EU-Viet Nam Business Network (EVBN), it is planned in the context of the free trade agreement Viet Nam signed with the EU, becoming only the second country in AEAN after Singapore to sigh such an agreement with the European bloc.

Eurosphere will feature 80 European brands in fashion and accessories, gourmet food and beverages, perfumery and cosmetics, interior design and automotive, and more.

Around 3,500 large importers, distributors, retailers, hospitality specialists, fashion designers, policy makers, industry influencers, media representatives, VIPs and celebrities are expected to attend.

Delphine Rousselet, director of EVBN, said European businesses deciding to enter Viet Nam at this crucial time would have first-mover advantage in establishing their name in the market.

The expo will be held at the Gem Center in District 1 on June 16 and 17. 

BMP issues bonus shares to raise charter capital     

The Binh Minh Plastic Joint Stock Company (BMP) has decided to issue around 36.4 million bonus shares to raise its charter capital from VND455 billion (US$20 million) to VND819 billion.

Money for the bonus shares will be sourced from the company’s development investment fund. At the end of 2016, the fund was worth VND1.256 trillion.

Previously, BMP had approved a cash dividend payment at 40 per cent.

In the first quarter of this year, BMP earned a revenue of VND832 billion, up 15 per cent over the same period last year. However, its after-tax profit decreased by 50 per cent to VND100 billion.

The company is targeting a revenue of VND4 trillion and a pre-tax profit of VND700 billion in 2017. 

Mường Thanh Group launches five-star hotel in Đà Nẵng     

The Muong Thanh Hotel Group has launched a five-star hotel – its second hotel project in Da Nang, part of a chain of 53 hotel projects and resorts across Viet Nam.

The group said the Muong Thanh Luxury Da Nang hotel, situated on Vo Nguyen Giap Street on Son Tra Peninsula, will comprise of two apartment buildings with a total of 583 rooms and three meeting halls.

The hotel on My Khe beach will provide accommodation for booming tourism in the city during summer, with hotels and resorts filling 82 per cent of capacity in 2016

The Muong Thanh Hotel Group was recognised as the largest private hotel chain in Indochina by the Viet Nam Records organisation-VietKings and Indochina Record.

VN's, Chinese firms shake hands     

The Vietnamese Loc Troi Group and the Chinese YSKL Ltd Company officially signed a cooperation trade agreement in the presence of the two countries’ leaders on May 12.

On the occasion of Vietnamese President Tran Dai Quang’s visit to China at the invitation of President Xi Jinping, the two companies agreed to form two joint ventures with an initial charter capital amount of US$10 million toward producing seeds and agricultural products.

The agreement is considered an opportunity to bring Vietnamese agricultural products into the Chinese market and to bring Chinese rice plants from all over Asia into Việt Nam for mass production and increase the country’s agriculture export market.

VCA to hold public consultation on anti-dumping duties     

Viet Nam Competition Authority (VCA), under the Ministry of Industry and Trade, has invited concerned parties to a public consultation on anti-dumping tariffs on H-shaped steel products.

The consultation, related to H-shaped steel products imported from China (including Hong Kong), will be held on June 20, wherein all parties will get the opportunity to express their opinions on anti-dumping tariffs.

Applications to participate in the consultation have to be sent to the VCA’s Trade Remedies Investigation Division before 5pm on June 5, and concerned parties can send their contents before 5pm on June 9.

VCA’s deputy director Nguyen Phuong Nam said the public consultation would be based on Order No 20 on anti-dumping tariff on goods imported into Viet Nam, and Decree No 90 on the implementation of this order.

Earlier, the ministry had issued a decree imposing temporary anti-dumping duties on H-shaped steel products imported from China. Under Decree No 957/2017/QD-BTC, anti-dumping duties imposed for all Chinese steel produders exported to Viet Nam is 36.33 per cent and will be in effect from April 5 to August 2, 2017.

However, some companies such as Heibei Jinxi Iron and Steel Group and Hebei Jinxi Section Steel were charged lower anti-dumping taxes at 29.4 per cent, others such as Rizhao Steel Holding Group and Rizhao Medium Section Mill were charged at 21.18 per cent.

H-shaped steel products are used to make support beams during constructions, girders for containers and trucks, steel decks and chassis. 

VN grants licence to Kien Giang gas project

The Block B of O Mon gas pipeline project in the Mekong Delta province of Kien Giang this week received its investment certificate.

This project has total investment of US$1.27 billion and is a joint venture among Viet Nam Oil & Gas Group (PVN), PetroVietnam Gas Corporation (PV Gas), Japan’s Mitsui Oil Exploration Co., Ltd (MOECO) and Thailand’s PTT Exploration and Production Public Company Ltd.

Southwest Pipeline Operating Company (SW POC), a subsidiary of PVN, will be responsible for implementing and operating the project.

Block B of O Mon gas pipeline has total length of 431km with design capacity of 20.3 million cubic metres of gas per day, equivalent to 6.4 billion cubic metres per year.

Of this, the sea pipeline has a length of some 292km, the shore pipeline is 102km long and the branch pipeline has a length of 37 km. There will be a landfall station, line shutoff valve stations, a the Kiên Giang gas distribution station and an Ô Môn gas distribution centre along the pipelines.

The project hopes to collect 107 billion cubic metres of gas and 12.65 million barrels of condensate from offshore Block B.

Some 5.06 billion cubic metres of gas is expected to be brought ashore per year from 2020 to 2040 to fuel power plants in Kien Giang and O Mon District of Can Tho City.

The development of Block B will cost US$6.8 billion over 20 years, covering one technology centre, 46 drilling platforms, one accommodation platform, one condensate tank and some 750 drilling wells.

In November 2015, Kien Giang’s Planning and Investment Department issued the registration certificate for the project.

Thua Thien-Hue calls for investments in 104 projects

The central province of Thua Thien-Hue is calling for investments in 104 projects during 2017-2018 with orientations towards 2020.

Under a decision recently issued by the provincial People’s Committee to announce the list of the projects, there are 24 projects on industrial production, 35 on tourism and services and 20 on construction and infrastructure. Other projects cover agriculture, education-training, health care, trade and transport. 

The most noteworthy tourism projects are eco-tourism areas namely Con Hen-Con Da Vien in Hue city, Dien Loc, Phong Hai and Bau Bang in Phong Dien district, and Quang Cong in Quang Dien district. 

Meanwhile, industrial projects mainly focus on the production of beverages, electronic products and health equipment, as well as auto and motorbike manufacturing. 

Aquatic product processing plants and pork, cow and poultry farms are also pitching for investments. 

Chairman of the provincial People’s Committee Nguyen Van Cao said the locality has renovated its investment promotion methods by encouraging the participation of all economic sectors and connecting with partners of investors like banks, infrastructure businesses and investment consultation companies. 

At the same time, the province has increased connectivity and direct dialogues between provincial leaders and investors, investment management agencies and commercial affairs offices. 

Industrial areas in Thua Thien-Hue so far this year have attracted three projects valued at nearly VND1.24 trillion (US$57.56 million), raising the total number of projects to 140 worth VND64.3 trillion (US$2.8 billion), including 35 foreign direct investment (FDI) projects with a combined capital of US$1.74 million. 

Apart from industrial parks like Phu Bai, Phong Dien and Phu Da, the province has built the Phong Dien textile –garment support industrial park covering 400 ha which is expected to have a centralised waste water treatment system of national standards. 

The province prioritises projects with cutting-edge technologies that meet EU standards in the Phong Dien industrial park. 

In the Chan May-Lang Co economic zone, Thua Thien-Hue has also created the best possible conditions for projects, especially large-scale ones, promptly dealt with difficulties facing investors, mobilised resources for transport infrastructure while offering preferential policies regarding land clearance, electricity, vocational training and tax.

German trade outlook with Vietnam continues to be bullish

German transnational companies see promising opportunities on the horizon for commercial trade with Vietnam, said one of Germany’s top economic parliamentarians on May 12 at a business forum in Ho Chi Minh City.

Iris Gleicke who serves as the German Parliamentary State Secretary at the Federal Ministry for Economic Affairs and Energy, said that initially ASEAN was viewed as merely a political unit.

But with the formation of the ASEAN Economic Community, the Southeast Asian economies are proving to be one of the most rapidly growing economic regions around the globe.

More and more German businesses are looking to expand commercial trade in the region as a result of the expanding industrial base, which is creating a middle-class whose purchasing power is continually increasing and who have a fervent desire for quality German products.

Nguyen Hoang Long, head of the Department of External Affairs, in turn pointed out that Germany has been the largest trading partner of Vietnam in the EU since 2012. He noted that the country’s geographic location serves well for the Southeast Asian country becoming a gateway to ASEAN for the German business community.

Products with the label ‘Made in Germany’ are already very popular in the ASEAN region, he noted.

He added that the creation of a single market with duty free movement of goods within the region along with standardization and focus on international standards and regulations by the ASEAN member countries brings further advantages.

Most notably, it makes it easier for German companies that decide to boost commercial trade with Vietnam to gain access to all ten markets in ASEAN— namely Vietnam, Indonesia, Thailand, Malaysia, the Philippines, Brunei Darussalam and Singapore along with Laos, Cambodia and Myanmar. 

IMF forecasts 6.5% for Vietnam’s economic growth in 2017

The International Monetary Fund (IMF) has projected Vietnam’s economic growth in 2017 at 6.5%, the highest among all Asian nations, and 6.3% for next year.

The IMF said Vietnam gains higher economic growth thanks to higher domestic consumption, recovery of agricultural productivity, and growth in the industry sector, which is largely contributed by foreign direct investment (FDI) enterprises.   

It described Vietnam’s fiscal policy as supportive but less influential on the economy.

According to IMF report, GDP growth of the ASEAN 5 (including Indonesia, the Philippines, Thailand, Malaysia, and Vietnam) will exceed 5% per year from now until 2022.

Demand from China, Africa supports Vietnamese rice prices at harvest end

Vietnamese rice is being offered at around $35-$40 a ton below Thai grain.

China and several African countries have returned to Vietnam seeking fragrant and white rice, and the demand has helped stabilize export prices even though supply has risen at the end of a major harvest, traders said on May 12.

They also said Vietnamese rice being offered for cheaper prices than Thai and Indian rice has also attracted buyers, mostly from Africa. Vietnam is the world's third-largest rice exporter, behind India and Thailand.

Farmers in the Mekong Delta, Vietnam's food basket, have finished harvesting the winter-spring crop, the biggest of the country's three annual crops. Paddy output eased 2 percent from last year to an estimated 9.8 million tons, based on government statistics. Most of the grain from this crop is being exported.

Reuters cited Vietnamese traders' quotations for five percent broken rice showing prices rose this week to $355-$360 a ton, free on board (FOB) basis, on more active trade.

At $360 a ton, the price is at its highest since August 31, 2016.

But traders at foreign firms and a dealer at a state-run export company in Ho Chi Minh City told VnExpress International that exporters are looking to sell the grade at around $355 a ton, while bids stood at $350-$352 a ton, similar to last week.

"Rice exports to China are going well," the dealer said. "Africa is also coming back with inquiries for the 5-percent and the 15 percent broken varieties, as well as fragrant rice."

He added that ample supplies are now available to state-owned export firms that have better access to bank loans, while private exporters are struggling to build stock due to weaker finances.

Vietnamese prices are below those offered by Thailand, where the 5-percent broken rice rose this week to $387-$392 a ton, FOB basis, from $380-$390 last week and $360-$375 at the end of April due to loading demand during a slow off-season harvest, Reuters cited Thai traders in Bangkok as saying.

Traders noted China, the biggest buyer of Vietnamese rice, has been taking more of the grain in the past month.

China imported 288,000 tons of rice from Vietnam in April, way above the monthly average of 176,000 tons in the first quarter, Vietnam Customs data showed.

That brought Vietnam's total export volume to China in the January-April period to 815,000 tons, a rise of 16 percent from a year ago, based on data from the Finance Ministry-run customs agency.

Earlier this year, China approved 22 Vietnamese rice export firms as official suppliers, but is also trying to limit rice purchases across the land border with Vietnam.

China is projected to import 5 million tons of rice this year, up 8.7 percent from 2016, the US Department of Agriculture said.

Vietnam is forecast to export 5.6 million tons in 2017, up 10 percent from last year, the USDA said in a report on May 10. 

The USDA also forecasts both India and Thailand will export around double that amount this year.    

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