Vinalines’ port activity surges

After enduring a number of slow years, Vinalines’ joint-venture ports CMIT, SP-PSA, SSIT, and CICT rated better numbers in 2016, signalling an upward trend.

According to a VIR source, SP-PSA, a joint-venture port of Vinalines and Singapore-based PSA, saw its volume of bulk goods increase 32.7 per cent on-year to 1.54 million tonnes last year. Container throughput reached 67 twenty-foot equivalent units (TEUs).

The port located in the Cai Mep-Thi Vai area of the southern province of Ba Ria-Vung Tau made revenue of $3.07 million in the year, up 33.47 per cent on-year.

SSIT, a joint venture between Vinalines and US-based Carrix/SSA, handled 3.8 million tonnes of goods during the period, doubling its 2015 volume. The port, also in Cai Mep-Thi Vai, reported revenue of over $5 million, up 85 per cent on-year.   

2016 also saw business improvements at Cai Lan International Container Terminal (CICT), located in the northern province of Quang Ninh. This joint venture also has Carrix/SSA as a partner.

CICT accommodated over 3.82 million tonnes goods in bulk last year, up 38.9 per cent, while revenue rose 22.6 per cent to over $8 million.

The year was also a success for Cai Mep International Terminal (CMIT), the joint venture between Vinalines and Danish company APM Terminals, the world’s leading port operator with 72 container terminals in 69 countries.

In 2015, the volume of container throughput goods shipped via CMIT rose 80 per cent on-year to over 720,000 TEUs. The figure reached over 1.2 million TEUs by the end of 2016, after years of clocking just 31.7 per cent of capacity. This port’s revenue also rose 28.2 per cent to $22.4 million.

Good performance by the foreign joint-venture ports has contributed to a significant on-year rise of 36 per cent in the total volume of container throughput of ports in the Cai Mep-Thi Vai area in 2016, to around three million TEUs out of an annual designed capacity of over seven million TEUs.

“The significant rise in the volume of goods in bulk at CICT, SSIT, and SP-PSA was attributed to strong demands for imported animal feed, soy beans, and corn in 2016 – which are the ports’ key items,” Nguyen Canh Tinh, acting CEO of Vinalines, told VIR.

“In addition, a solid rise in the country’s container volume and more goods flows from Saigon port to Cai Mep-Thi Vai has contributed to CMIT’s robust growth of container throughput,” he added. “The seaport sector is likely to grow 10-12 per cent this year.”

After years of difficulties in attracting cargo, the Cai Mep-Thi Vai port complex are pushing to become important transhipment hubs as well as  gateways to the south.

Last week marked an important milestone for CMIT and the Cai Mep-Thi Vai port complex, as it successfully launched a trial berth for 18,000 TEU vessels. The port of call of “Margrethe Maersk” is the first call ever of a Maersk Line Triple-E container vessel to Vietnam – the largest container vessel ever to come to Vietnam.

“This important ‘test call’ confirms our strong commitment to Vietnam – a commitment that had its start almost a century ago, when the first Maersk vessel arrived in Vietnam in 1923. Last year we started direct service between Vietnam and North America. With the ‘test call’ we hope we are on the way to establishing a direct service between Vietnam and Europe,” said an official on the Margrethe Maersk.

Currently, the Cai Mep-Thi Vai port complex accommodates 10 direct services to the US weekly. For imports and exports from and to the European market, there are three weekly mainline services connecting directly with Europe. Terminals in Cai Mep-Thi Vai also berth seven services dedicated to intra-Asia imports and exports.

Panasonic expands in Binh Duong

Panasonic Corporation has announced an intention to invest approximately JPY1 billion ($8.9 million) in expanding its wiring device and circuit breaker factory, Panasonic Eco Solutions Vietnam Co. (PESVN), in southern Binh Duong province. The expansions are expected to go into operation in October.

An additional factory will be built adjacent to the existing factory to enhance responsiveness to the rapid increase in demand for wiring devices and circuit breakers in Vietnam over recent years.

A breaking ground ceremony was held on February 25. Mr. Takashi Ogasawara, Power Components Business Unit Director of the Energy Systems Business Division at PESVN and Mr. Takashi Ogura, General Director of PESVN, attended the event.

The existing plant launched full-scale production in November 2014 as a new manufacturing site for wiring devices and circuit breakers in Southeast Asia, following those in Thailand and Indonesia. It currently produces approximately 53 million wiring devices and approximately 13 million circuit breakers annually.

With the additional factory, PESVN aims to double its production capacity in FY2020. There are also plans to explore the purchase of an area of approx. 18,000 sq m adjacent to the existing factory in order to address any further increase in demand.

Panasonic Corporation is a worldwide leader in the development of diverse electronics technologies and solutions for customers in the consumer electronics, housing, automotive, enterprise solutions, and device industries. Since its founding in 1918, the company has expanded globally and now operates 474 subsidiaries and 94 associated companies worldwide.

PENM IV Germany to buy HPG shares

Private Equity New Markets Germany IV (PENM IV) has registered to purchase 3 million shares of the Hoa Phat Group (stock code HPG), or a 0.36 per cent holding.

It will spend about VND120 billion ($5.26 million) on the transaction, to be carried out from March 2 to March 31.

HPG’s share price fell after it announced its manufacturing and business plan for 2017 recently. Revenue for 2017 was targeted at VND38 trillion ($1.66 billion), up 14.2 per cent against 2016, but net profit was targeted at VND5 trillion ($219.72 million), down 24 per cent.

Shares now hover between VND40,000 ($1.75) and VND 41,000 ($1.79), after peaking at VND45,500 ($1.99) in the last ten days.

“This is normal,” according to Mr. Bui Duc Hoan, Vice President of Equity Research at Maritimes Securities Incorporation (MSI). “It’s not such a bad thing, and is even a good opportunity for investors looking at the mid- and long-term potential of HPG.”

Saigon Securities Incorporation (SSI) expects that HPG share price will rise 46 per cent this year.

HSX puts 21.6mn PVB shares on warning list

The Hanoi Stock Exchange (HSX) put 21.6 million shares of PVCoating (stock code PVB) on to its warning list on February 27.

After-tax profits as at December 31, 2016 were negative, triggering the warning.

PVCoating’s revenue reached VND6.4 billion ($280,997) in 2016, down sharply compared to the VND900 billion ($39.5 million) recorded in 2015. Its costs were more than VND71.6 billion ($3.1 million), resulting in a loss of VND54 billion ($2.37 million). This is the first time PVCoating has recorded a loss in the last eight years.

PVCoating is now among the ten listed enterprises with the highest losses at present.

Its share price fell sharply last week, from VND14,300 ($0.62) per share on February 20 to VND13,100 ($0.57) on February 24.

It had increased from VND10,200 ($0.44) per share to VND13,800 ($0.6) from February 13 to February 18; a rise of 35 per cent.

Agro-forestry and fisheries exports hit US$4.3 billion in two months

Vietnam’s agro-forestry and fisheries export revenues were estimated at US$1.9 billion in February, bringing the total figure for the first two months of 2017 to US$4.3 billion, up 1.4% compared to the same period of 2016.

According to the Ministry of Agriculture and Rural Development, the export value of major farming items hit roughly US$2.4 billion, up 8.8% year on year, while the respective values for the fisheries and forestry sectors were US$844 million, down 3.1%, and US$993 million, up 0.3%.

Rubber items registered the largest growth, up 25.4% in volume and 2.4 times in export value. Vietnam exported 193,000 tonnes of rubber in the January-February period, raking in a revenue of US$392 million.

Wood items and products took the lead in terms of export value, with approximately US$944 million, up 0.8% against the same period last year.

In addition to increases, a number of key export items saw sharp year-on-year declines, including rice, tea, fisheries products, cashews and pepper. Rice exports reached 799,000 tonnes in volume and US$248 million in value, down 17.2% and 40.6%, respectively.

In the opposite direction, Vietnam imported roughly US$2.19 billion worth of agro-forestry and fisheries products in February, making the two-month figure about US$4.07 billion, up 21.8% over the same period of 2016.

Pangasius fish price increases in Mekong Delta

Pangasius fish price has been moving up in the Mekong Delta since the Tet holiday. On Tuesday, businesses paid VND23,000-26,000 a kilogram, up VND1,000-3,000 compared to the price before the holiday.

With this price, farmers earn a profit of VND3,000-5,000 a kilogram. It is considered as the longest price increase lasting for three consecutive months in the region.

According to local experts, the price increase has been due to good signals in the world market. Despite the price hike, there is not much mature fish left in farms for sale. Processing plants have operated at only 40-60 percent of their capacity because of material shortage.

The price increase surged young fish demand with price rocketing to VND60,000 a kilogram, double the level in previous years. However supply had been able to meet 30-50 percent of demand, experts said.

According to Vietnam Pangasius Association, Pangasius fish farming area in the delta reduced over 3,400 hectares last year, output topped one million tons and export turnover went up 9.6 percent to reach US$1.7 billion.

About 200 Vietnamese businesses have exported products of the fish to 138 markets in the world. The strongest consumption markets comprise the US, the EU, China and ASEAN.

FDI capital in real estate posts year on year twelvefold increase

Foreign investors have poured US$345.5 million into Vietnam’s real estate field as of February 20 this year, accounting for 10.1 percent of total FDI capital and increasing twelvefold over the same period last year when it hit $29.07 million, reported the Foreign Investment Agency under the Ministry of Planning and Investment.

During the period, 11 new projects were licensed with the registered capital of $309 million, two projects increased investment and 14 projects received capital contribution via share purchase with the value nearing $59 million. 

The real estate sector has lured a total of $52.4 billion FDI capital accounting for 17.6 percent of the country’s total by the end of February. Notably, HCMC is considered as a hot market with positive signs in popular and middle segments providing apartments for sales and office buildings. 

Mr. Stephen Wyatt, director general of Jones Lang Lasalle Vietnam, forecast 2017 will see a record high in trading and merger activities in the real estate market of Vietnam. 

In related news, the Housing and Real Estate Market Management Agency under the Ministry of Construction reported that property inventory value approximates VND29,573 billion ($1.3 billion) nationwide now. 

The inventory mainly concentrates in Hanoi and HCMC in the segment of housing land projects far from the center of the cities and with incomplete infrastructures. 

Compared to December last year, the inventory level reduced by VND1,450 billion equivalent to 4.67 percent. Hanoi decreased to VND5,538 billion. HCMC saw a reduction of VND283 billion to VND5,518, a strong fall compared to the ministry’s reported number last April of VND7,730 billion which was the country’s highest level. 

After four years of inventory peak in the first quarter 2013, the real estate market has resolved over three forth of properties in stock.

Credit grows strongly in Jan

Banks have said credit in the banking system expanded 2.18% in January, much higher than in the same month of previous years.

In January last year, credit declined 0.2% compared to December 2015. Credit at the end of the first quarter last year grew 1.54% against late 2015. The credit growth target for this year is about 18%, the same as in 2016.

Of total outstanding loans, the amount in Vietnamese dong rose by 2.07%, while growth in foreign currency loans was stronger, 3.4%.

This year the central bank has yet to release data on credit growth. But banks said the banking system is rapidly pumping huge amounts of money into the economy.

Deposits fell 0.38% in January. In particular, deposits in dong and foreign currency edged down 0.41% and 0.06% respectively.

As a rule, the period before and after the Lunar New Year holiday (Tet), savings at banks slow down as the demand for cash tends to surge. Post-Tet cash flow into banks will return to normal when the needs for year-end payments are no longer strong.

Thus, it is normal that capital mobilization in the banking system is down in January, but improves in February and March.

HCMC mulls setting up public transit authority

The HCMC transport authority is weighing the possibility of establishing an authority responsible for managing public transit in the city to ensure effective operations.

The integrated public transit system in the city will consist of commuter bus, bus rapid transit, metro and tram, among others.

At a conference on establishment of a public transit agency in the city last Friday, some suggested integrating some existing relevant boards, instead of establishing a new organization.

A World Bank (WB) representative told the conference that the city’s public transit system will undergo drastic changes by 2025 when the city’s first metro line, bus rapid transit system and tramway are up and running. Therefore, the city will need an agency in charge of public transit management because some existing organizations are not under the Department of Transport.

The WB representative noted a lack of integration would lead city commuters to carry 30 different kinds of card for each line or each vehicle. Moreover, they would have to search for routes or download 30 software programs for each bus line. This would be very inconvenient for commuters.  

Commenting on this proposal, Le Van Lam, deputy director of the HCMC Department of Home Affairs, said what was suggested by the WB representative would not work as the city is streamlining its bureaucracy.

The Public Transport Management and Operation Center is currently run by the Department of Transport, Lam said, and in the future, it could take on more functions and staff from other relevant boards if need be. "It’s hard to have a new agency at the moment," Lam said.

Nguyen Thi Bich Hang at the  University of Transport and Communications said it is not necessary to create a public transit agency because the first metro line of the city will not be in service by 2019. The Public Transport Management and Operation Center should be empowered to oversee public transit, she said.

The WB representative noted the city should have a long-term vision. In the long run, the city’s public transit systems would be expanded to neighboring provinces and the proposed agency could operate the entire public transit network.

Le Hoang Minh, deputy director of the HCMC Department of Transport, said the department would make the Public Transport Management and Operation Center the key operator of public transit services, so more functions and powers would be delegated to it so that it could become a central transport management and operation authority of the city. 

Japan’s leading sports company enters Vietnam

Supersports, one of Vietnam’s largest sporting goods chains, last week introduced Mizuno, Japan’s century-old sporting goods icon, at Supersports SC VivoCity outlet in District 7, HCMC.

This is the first time Mizuno running shoes have been introduced in Vietnam and will be distributed by Supersports. Mizuno is one of Japan’s best known sports equipment and sportswear company. Founded in Osaka in 1906, Mizuno is now a global corporation manufacturing a wide variety of sports equipment and sportswear for running, golf, tennis, baseball, volleyball, football, cycling, judo, table tennis, badminton and athletics.

Mizuno is Japan’s number one brand, and a favored provider in the U.S., France, Germany and Italy.

Representatives of Mizuno and Supersports hope that Mizuno’s famed Wave Rider and Sayonara lines could suit the diverse needs of Vietnam’s customers. This includes the 290 gram Wave Rider 20, one of the lightest running shoes on the market today. 

At the event, Supersports and Mizuno also introduced the foot gauge machine with “Precision Fit” technology to give customers the most accurate advice for their running shoes. The foot gauge machine will be used to serve customers at Supersports SC VivoCity.

Supersports, the largest sports retail chain in Thailand which entered Vietnam in October 2013, said it would open five to seven new stores this year.

Supersports and its exclusive brands have opened 32 stores in Hanoi and HCMC, with a total retail area of more than 5,000 square meters and more than 300 staff.

Beverages lead FMCG sales

Beverages continued to be the biggest contributor to total sales in the fast-moving consumer goods (FMCG) market segment in the fourth quarter of last year, according to a Nielsen Vietnam report. The report says beverages accounted for 40% of FMCG sales.

The report shows FMCG sales growth in six major cities  -- Hanoi, HCMC, Haiphong, Can Tho, Nha Trang and Danang -- bounced back in the period, with a year-on-year rise of 7.3%, the highest in three years, driven by a volume increase of 6%.

FMCG in Vietnam is categorized into seven groups of beverages (including beer), food, dairy goods, household care, personal care and baby care products, and cigarettes. All these categories but baby care registered positive growth.

In particular, the last quarter of last year saw growth of an impressive 11.6% in food, 9.6% in personal care goods, 8.1% in home care products and tobacco, and 3.2% in dairy products.

Rural areas emerged as a new source of growth for manufacturers as sales growth there was higher than in urban areas in October-September 2016 with 7% and 6.7% respectively, and 51% of total FMCG revenues in the country came from rural areas.

More rural consumers had better Internet access, smartphones and higher income, leading to stronger consumption in the countryside. Therefore, producers should learn more about consumer demand and trends in rural areas to boost sales, said Nguyen Anh Dung, director of retail measurement services at Nielsen Vietnam.

Cau Tre to build food processing facility in Hiep Phuoc IP

Cau Tre Export Goods Processing Joint Stock Co last Saturday signed an agreement with Hiep Phuoc Industrial Park Joint Stock Co to set up a food processing complex at Hiep Phuoc Industrial Park in HCMC.

The project will require a total of around VND1.2 trillion (US$52.8 million) and cover more than 70,000 square meters. Its key components include a food processing plant, a research and development center, and a modern food safety center.  

Established in 1983, Cau Tre underwent equitization in 2006. Apart from the domestic market, its products have found their way to more than 30 foreign markets, mainly Japan, the U.S., and Europe.

A source from Cau Tre said work on the food processing complex could begin sometime this year. 

Late last year, South Korea's CJ Cheil Jedang Corporation, a unit of CJ Group, expressed interest in buying a stake of nearly 50% in the Vietnamese food processor. CJ Cheil Jedang planned to acquire 47.33% of Cau Tre's shares from Transwell Enterprises Limited, Viet Fund and Song Da Corporation via put-through deals.

Cau Tre showed a willingness to embrace big investors with strong finances and good corporate governance as it is looking to become a leading food processor in Vietnam.

Voluntary social insurance attracts little interest

The number of voluntary social insurance buyers has remained woefully low though numerous measures have been taken by authorities to encourage people, especially self-employed and workers without an employment contract, to voluntarily get social insurance.

Most of them are people who have had participated in compulsory social insurance while self-employed laborers account for a small fraction.

At a conference on voluntary social insurance last week, Tran Hai Nam, deputy head of the Department of Social Insurance at the Ministry of Labor, Invalids and Social Affairs, said the 2014 Law on Social Insurance, which went into force in 2016, contains favorable provisions for the voluntary socially insured.

The minimum social insurance payment is down from 22% of the monthly base salary of VND1.21 million to 22% of the rural poverty line of VND700,000 per month. This means people can pay at least VND154,000 monthly, instead of VND266,000.

In case the rural poverty line stays unchanged and is not inflation-adjusted, a female employee would receive a monthly pension of 60% of her income at the age of 55 after 20 years of voluntary social insurance.

“An employee who pays VND154,000 in monthly social insurance in a period of 20 years will get a monthly pension of VND420,000. On average, Vietnamese women who retire at 55 will die before they reach 79-1/2. This shows voluntary social insurance is beneficial,” Nam said.

The 2014 Law on Social Insurance provides different insurance premium payment methods. In case one has big extra incomes, they can choose to make a one-off payment for many years as a saving. If retirees have paid social insurance for less than 10 years, they can pay premiums for all the remaining years as required by law to get a full pension.

But the number of voluntary social insurance policy holders in Vietnam by the end of 2016 was just more than 200,000, down 7% compared to 2015. Only 0.4% of the nation's workforce has bought social insurance policies on a voluntary basis. Moreover, most of them have participated in compulsory social insurance policies and purchased voluntary social insurance policies just to fulfill the pension requirements.

The problem is this kind of insurance just covers retirement and death, not illnesses, maternity leave, work accidents and occupational diseases.

In addition, the duration of 20 years required for voluntary social insured people to get a pension is too long.

Credit and land policies for agriculture should be loosened

Leaders of the Ministry of Agriculture and Rural Development have asked the National Assembly (NA) to relax credit and land policies for agriculture to guarantee its sustainable development.

Speaking at a working session with a NA delegation led by vice chairman Phung Quoc Hien last week, Deputy Minister Le Quoc Doanh said the sector remains highly vulnerable to climate change, small-scale production and heavy dependence on the unpredictable Chinese market.

Vegetables, coffee, pepper, cashew and rubber have brought billions of U.S. dollars in export revenue but State investment in infrastructure and irrigation systems for these products has not been as big as that in rice, Doanh said. Therefore, he proposed, this issue should be dealt with.

Land should be allowed to be amassed to cultivate short-term and perennial crops of higher economic value, he said.

Hoang Thanh Van, director of the ministry's Department of Animal Husbandry, said owners of livestock farms are more inclined to adopt small-scale production because it is difficult to secure as much land as needed and the duration of land use is short. This is a huge impediment to scientific and technological development in livestock farming, and improvement of product quality.

He suggested extending the duration of land use, allowing investors to amass arable land for large-scale farming, and granting longer land leases.

In recent years, a couple of major local companies have established their own research and development centers, such as dairy processor TH Group and feed producer Dabaco Group, but they have got little policy support, Van said, adding credit and tax policy incentives should be extended to them.

Minister Nguyen Xuan Cuong told the delegation that the NA should amend the 2013 Land Law in a way that facilitates land accumulation, large-scale farming, transfer of agricultural land, and conversion of land use purposes among rice, annual trees, livestock and aquaculture.

Credit policy should be improved in a way that prioritizes lending to high-tech agriculture and private sector investment.

NA vice chairman Phung Quoc Hien threw his support behind the idea of allowing investors to amassing land to develop large-scale farms, saying the Land Law should be revised to prop up large-scale farming.

He warned domestic agriculture is heavily dependent on China while Chinese trade policy is highly unpredictable. "Farm goods like pigs would take a big hit whenever China changes trade policy or Chinese traders resort to price manipulation tactics. A bumper crop is always accompanied by a price plunge or vice versa."

Instead of only focusing on China, the sector should diversify its foreign markets, especially those requiring high standards, while paying due attention to the growing middle class in Vietnam as this group of consumers is ready to pay high prices for organic farm products, Hien noted.

The sector, he stressed, has no other choice but to adopt advanced science and technology to turn out high-quality products for local and export sale.

Collecting taxes from online stores possible - experts

Experts believe there are legal grounds to collect taxes from those individuals and organizations selling goods on Facebook but much work will need to be done to ensure proper and sufficient tax collection.

Nguyen Hung Du, tax partner at Grant Thornton Vietnam, told the Daily that technically, the tax authority may contact Facebook to gather data and track transactions of sellers to determine their taxable incomes.

Lawyer Chau Huy Quang, managing partner at R&T LCT Lawyers, said the sharing of Facebook user data must comply with privacy protection rules.

At the moment, Vietnam has no specific laws on privacy but this right has been recognized in a number of legal documents, such as Article 6 of the 2010 Law on Consumer Protection, Article 21 of the 2006 Law on Information Technology, and Article 17.1 (c) of the 2015 Law on Cyber Information Security.

Thus, Facebook is obliged to protect the privacy of users, said Quang. However, this social networking site also has the right to provide information about its users at the request of competent authorities without being considered a violation.

Yet, there is another issue. Private affairs of Facebook users are protected by U.S. law since Facebook is a legal entity of America and has no commercial presence in Vietnam. U.S. law prohibits the disclosure of users' private information, thus preventing Facebook from cooperating with Vietnamese tax authorities.

Even when information about sellers on Facebook is provided, there would be still a lot of work to do to verify information such as name, address, product/service and online transaction before taxes are imposed, said lawyer Quang.

To ensure full and accurate tax collections from individuals and organizations selling goods on Facebook via a personal account or a fanpage, there should be coordination between the parties concerned.

Specifically, technical management measures and tools should be developed, such as an integrated information system for tax offices, verification, survey, inspection, public consultations with the tax advisory council, and tax records at tax offices. Banks should also cooperate to verify vendors' earnings.

Buyers should be encouraged to pay for goods by card to make tax collections possible.

Agriculture ministry backs cooperatives to build material zones

The Ministry of Agriculture and Rural Development will set aside VND145 billion (US$6.3 million) to help agricultural cooperatives build large material zones to develop key farm goods for export.

The ministry held a conference last week to discuss plans this year and implement a Prime Minister’s decision on expansion of a new cooperative model in 2016-2020 in the Mekong Delta.

The ministry will focus on safe material zone projects that will supply processors of key products in the delta for export. In particular, it will help build a green-skin pomelo farming area in Ben Tre Province while Tien Giang Province will become a Hoa Loc mango and dragon growing area with a minimum of 1,000 hectares.

Currently, Vietnam’s green-skin pomelo is exported to the Netherlands, China, Canada, Germany and Russia. Meanwhile, mango and dragon fruits have found their way to the Australian market.

The delta will expand rice material zones to some provinces such as Kien Giang, Can Tho and Long An. Such zones will make it possible to meet high demand of large markets such as the U.S. and Europe.

EVN SPC works to link southern rural areas with national grid

The Southern Power Corporation (SPC) of the Electricity of Vietnam Group (EVN) is implementing several projects to connect southern rural areas with the national grid.

The total investment for these efforts amounts to more than 21.29 trillion VND (934.4 million USD), the EVN SPC said.

It noted that in 2016, the corporation finished projects bringing electricity from the national grid to the island communes of Lai Son, Hon Nghe and Son Hai in Kien Giang province. 

While 43km of 110kV lines were set up to link Lai Son with the mainland, 24km of medium- and low-voltage lines along with other necessary facilities were built on the island, benefiting 1,956 households.

On Hon Nghe island commune, 526 households accessed electricity after 16.4km of cross-sea 22kV lines and 9.9km of three-phase medium-voltage lines were installed.

Meanwhile, 4km of cross-sea 22kV lines and 4.8km of three-phase medium-voltage lines are powering 558 households in Son Hai island commune, the corporation noted.

It said it is going to carry out similar projects in the island communes of Tien Hai and Hon Thom of Kien Giang from now to 2019.

From 2016 to 2020, the EVN SPC has been implementing a project to provide power from the grid for 12 provinces and island communes of Kien Giang province, part of a Prime Minister-approved programme on power supply for rural, mountainous and island areas. 

The project is set to build 5,857km of medium-voltage lines, 9,604km of low-voltage lines, and transformer stations with total capacity of 516 MVA to give electricity to 165,045 households in the region.

A World Bank (WB) loan is funding the third phase of a project on electricity development with total investment of 921 billion VND (40.4 million USD). With the funds, the EVN SPC will construct 695km of medium-voltage lines, 609km of low-voltage lines and distribution stations with total capacity of 115.8 MVA.

This project has powered industrial shrimp farming facilities in Ca Mau, Bac Lieu, Soc Trang and Tra Vinh provinces and dragon fruit cultivation in Long An province. Other facilities will become operational in Phu Quy island district of Binh Thuan province in 2017, according to the corporation.

The EVN SPC is also carrying out the fourth phase of this project with an estimated cost of more than 6.42 trillion VND (281.8 million USD), also partly financed by the WB. Accordingly, 73km of 220kV lines will be built to supply electricity to Kien Giang’s Phu Quoc island district, along with facilities to ensure power supply for the southern region.

Another project worth some 1.09 trillion VND (47.8 million USD) partly loaned by the Japan International Cooperation Agency is also under construction. It is building two 220kV transformer stations with combined capacity of 500 MVA in Can Duoc district of Long An province and Sa Dec city of Dong Thap province. Both are expected to be finished this year.

Meanwhile, the German Development Bank is providing credit for the EVN SPC to implement a project on upgrading the electricity network in small and medium cities. This project aims to construct 110kV lines, upgrade medium- and low-voltage lines in small and medium cities which the corporation covers, ensure a stable power supply, and minimise overloading.

Vietnam Manufacturing Expo slated for April this year

Measurement and automated assembling technology will be the focus at the “Vietnam Manufacturing Expo 2017” which will take place from April 26 – 28 at the International Centre For Exhibition (I.C.E) in Hanoi.

Held by Reed Tradex Limited Company, the expo is hoped to support Vietnam’s manufacturing sector and facilitate Vietnamese producers’ efforts to move toward “smart manufacturing”.

Leading brands of measuring devices and automation technology such as Hexagon, Nikon, Scantech, Wenzel and MAT will gather at the exhibition. Experts in the field will also be available to share knowledge and technology with visitors.

The event also serves as an interactive ground for investors and suppliers to expand their networks.

Automation is getting more important to manufacturing, said Kasinee Phantteeranurak, Project Manager of Reed Tradex Company.

She noted that investing in facilities and technology to boost productivity can scale down the total cost in a long time, adding that it is time for Vietnamese producers to adopt smart manufacturing.

February price index in HCM City up 0.5 percent

The Consumer Price Index (CPI) in Ho Chi Minh City increased by 0.5 percent on a monthly basis in February, the municipal Statistics Office said on February 28. 

Compared to the same period last year, the February CPI has grown 5.79 percent. 

Among 11 categories in the commodity basket, nine saw price increases from January. The biggest increase (0.97 percent) was seen in the group of cultural, entertainment and tourism products, followed by transport with a 0.61 percent rise. The price index of the group of housing, electricity, water, fuel and construction materials went up by 0.57 percent. 

Meanwhile, post and telecom prices were down by 0.16 percent, and education goods stayed stable in the month. 

In the same period, gold prices in the city gained 1.42 percent, and that of US dollar dropped by 0.54 percent from January.

The national CPI in February also went up 0.23 percent month-on-month and 5.02 percent year-on-year.-

UK scholar highlights cooperation prospects with Vietnam

Vietnam and the UK are having numerous chances to increase the bilateral trade cooperation, according to Professor Julian Beer, Deputy Vice-Chancellor of Birmingham City University (BCU).

To seize these opportunities, both countries should focus on the fields that they could jointly increase the added values, the professor said in a recent talk to Vietnam News Agency’s correspondent.

The two countries are in a favourable position now to discuss enhancing collaboration at the national scale, he said, noting the proportion of Vietnam-UK trade in each country’s external trade is not high, even close to zero for the central part of the UK.

The professor remarked that although real opportunities are awaiting the two countries to increase their cooperation and open up new trade horizon, difficulties and challenges still lie ahead.

Therefore, it is advisable for Vietnam and the UK to seek mutually beneficial fields and sectors to propel the bilateral trade forward, he recommended.

Consumer price index rises slightly in February

The country’s consumer price index (CPI) in February inched up 0.23 percent from last month and 5.02 percent year-on-year, the General Statistics Office (GSO) announced on February 28.

Out of the 11 main goods and service groups, seven experienced price hikes during the month, including housing and construction material (0.77 percent), transportation (0.56 percent), medicines and healthcare services (0.22 percent), culture, entertainment and tourism (0.15 percent), other commodities and services (0.14 percent), restaurants and food services (0.11 percent) and household appliances (0.05 percent).

Meanwhile, slight falls were seen in telecommunication (0.07 percent), garment, hats and footwear (0.05 percent) and beverage and tobacco (0.01 percent). Education group remained unchanged.

Do Thi Ngoc, Deputy Head of the GSO’s CPI Department said that the rise in February’s CPI was due to high demand for certain commodities for traditional rituals in the first lunar month and spring festivals, such as flowers, food and restaurant services.

Growing demand for travel and higher fuel prices contributed to the increase in transport service costs, Ngoc stated.

However, there were some elements keeping CPI down like reduction in pork price due to low demands and limited export to China, abundant supply of fresh vegetables and weak demand for clothes after the festive season.

In the month, gold price continued to rise in line with the global trend despite rumor that the US Federal Reserve is going to lift interest rate. The price of gold in the domestic market fluctuated at around 36.9 million VND (1,621 USD) per tael.

Meanwhile, US dollar exchange rates remained stable at around 22,800 VND per US dollar thanks to profuse supply and low demand from enterprises.

According to the GSO, February core inflation (excluding food and fresh foodstuff, energy products and State-controlled commodities such as healthcare and education services) increased a marginal 0.2 percent from the previous month and 1.51 percent against the same period last year. 

Core inflation rate was under 2 percent, reflecting a stable monetary policy, it said.

The GSO forecasted that CPI in March will be higher than February due to surges in world prices of fuel and possible adjustments in healthcare services in 10 cities and provinces in line with the roadmap specified in Circular 37.

Canadian beef exporters seek bigger slab of Vietnamese market     

More and more Canadian beef exporters are seeking a bigger share of the market in Viet Nam, Canada’s Minister of Agriculture and Agri-Food Lawrence MacAulay told attendants of an event held in Ha Noi on Monday to introduce his country’s beef products.

"Canada is a major world exporter of beef. When we talk about Canadian beef, we talk about safety, quality and sustainability,” he said.

Last year, Canada exported over US$2 billion in beef. Asia has become one of its priority markets, with Viet Nam ranked as a market with high potential, he said.

Attending the event, Heinz Reimer, Vice Chairman of Canada Beef, which is responsible for domestic and international beef and veal market development, said that Canadian exporters are penetrating the Vietnamese market in recent years. Vietnamese imports of Canadian beef last year reached about 320 tonnes, much higher than the estimated 20 tonnes of two or three years ago.

Reimer said Canada has favourable conditions to raise hardy cow herds, specifically vast land areas, rich grasslands and fields, fresh air, clean and safe water, all of which help prevent diseases. He also added that Canadian cows are fed mostly with grains so their meat has a unique flavour.

The Canadian organisation and businesses will work with the food services segment and retailers in Viet Nam to promote products, as well as study customer tastes, he said. 

HCM City low-cost housing will be of high quality: official     

Low-cost housing projects planned by the municipal administration should have the same quality of construction and infrastructure as their commercial counterparts, Dinh La Thang, Secretary of the HCM City Party’s Committee, has said.

Addressing a conference held on Monday to gather ideas on building economical housing projects in the city, Thăng said low-cost social housing did not mean new slums in the city.

The social housing areas should have healthcare services, markets and schools, he said.

Thăng also emphasised that low-cost housing need not mean building smaller houses. New materials and new technologies should be used to cut costs, he added.

The Party Secretary affirmed that the city will spare no effort in trying to meet all targets on developing houses for workers and other low-income people. It will co-operate with real estate firms and developers and provide them with favourable conditions to develop social housing, Thang said.

Referring to Binh Duong’s success in building very cheap social housing, Thang said HCM City would study the neighbouring province’s determination and creativity, but apply it flexibly, based on the city’s own ground realities.

He suggested that greater co-operation between real estate developers and between them and suppliers of building materials would help cut down construction costs.

It was revealed at the conference that the Cement Corporation has pledged to cut down by VND300,000 (US$14) per tonne the price of cement used for low-cost social housing projects in the city.

Three developers also volunteered to work on social housing projects on a non-profit basis.

Le Hoang Chau, chairman of the HCM City Real Estate Development Association, said the city might be able to build 30sq.m-apartments for just VND100-200 million ($3,900-8,700), as Bình Dương had done. However, only a minuscule percentage of the population, about 10,000 people, would get them, which is not fair for so many people that need low-cost housing.

Developers at the conference agreed that it was not feasible to build apartments for VNĐ5 million ($220) per square metre.

The representative of one company said the best way would be to build 15-20sq.m apartments for long-term leases of up to 50 years.

“This is the best way to avoid slums,” he said, explaining that “when leasing, the quality of projects are still under the control of developer. People who do not obey regulations will be kicked out.”

He also suggested that the city should only sell 30-35sq.m apartments in 12-15 storied buildings.

Tran Trong Tuan, Director of the HCM City Department of Construction, said the city has a high demand for 40-60sq.m apartments priced between VND350 million ($15,300) and VNĐ1 billion ($43,800).

The department will work together with companies to find ways to reduce housing prices. It will also co-operate with other sectors to improve administration procedures, Tuan said.

A report released at the conference by HCM City Real Estate Association said the city would develop 39 projects with 45,000 condos up to 2020.

About 20 per cent of this will be for lease, 60 per cent will be paid for in installments and 20 per cent will be sold outright.

Better preferential loan rate likely for high-tech agriculture

Commercial banks can offer loans at preferential interest rate of less than 7 per cent per year for high-tech agriculture projects.

Deputy Governor of the State Bank of Việt Nam (SBV) Đào Minh Tú on Monday said several commercial banks have positively responded and are pledging to set aside some VNĐ100 trillion (US$4.4 billion) loans for high-tech agriculture at a preferential rate of less than 7 per cent depending on the financial status of each bank.

Tú said commercial banks are very interested in high-tech agriculture. Following the Prime Minister’s instruction on supporting high-tech agriculture development late last year, SBV has, so far, instructed the banks to apply preferential loans to high-tech and clean agricultural projects.

Director of SBV’s Credit Department Nguyễn Quốc Hùng also said the central bank is working with the Ministry of Agriculture and Rural Development and other relevant agencies to establish specific criteria to classify agricultural firms that apply high-tech and produce clean agricultural products to be able to offer the preferential lending programme.

According to Hùng, under the preferential lending programme on agricultural and rural development, the central bank will provide credit institutions refinancing programmes.

Besides this, the central bank will also support credit institutions by reducing their reserve requirement ratio. The reserve requirement ratio applicable for credit institutions whose outstanding loans for agriculture and rural development accounting for 40-70 per cent of their total outstanding loans will be equal to one fifth of the normal ratio set by the central bank. The ratio will be reduced to one twentieth for institutions whose outstanding loans for agriculture and rural development are more than 70 per cent of their total outstanding loans. 

According to SBV’s statistics, last year, the country’s total outstanding loans rose 14.93 per cent against the previous year to more than VNĐ5.35 quadrillion, of which agriculture, forestry and fishery industries reported a rise of some 16 per cent.

Late last year, the Government pledged to offer preferential policies on land, financing and technology to farmers and localities engaged in high-tech agriculture. Prime Minister Nguyễn Xuân Phúc said the five largest commercial banks “must create the best conditions to serve farmers, organisations and localities wanting to develop high-tech agriculture.”

In Việt Nam, 70 per cent of the population works as farmers, but agricultural production contributes only 20 per cent to GDP. In developed nations, only 2-4 per cent of the population work as farmers, but they contribute up to 40 per cent of GDP.

Only 4,000 enterprises out of 600,000 companies in the country invest in agriculture.

VN posts trade deficit of US$1.2b in February

Việt Nam reported trade deficit of US$1.2 billion in February, the General Statistics Office (GSO) announced on Sunday.

The GSO’s figures revealed that the country’s total import-export turnover this month reached $27.2 billion, of which export turnover was $13 billion, increasing 15.4 per cent from the same period last year, while import turnover was $14.2 billion or a year-on-year rise of 19.6 per cent.

However, in the first two months of the year, the country’s total trade deficit was $40 million as total export turnover was $27.34 billion while import turnover was $27.38 billion.

The GSO said many exported products saw a sharp decrease in February against the same period last year in terms of value and quantity, respectively, such as pepper which declined 27 per cent and 7.4 per cent and rice which declined 21.4 per cent and 18.4 per cent.

In addition, some other exported products, such as cashew, cassava, germ and ceramics, also witnessed a significant decrease.

Meanwhile, many items posted surge in exports. Coal rose by 1,104 per cent and 466 per cent in terms of value and quantity and rubber by 144 per cent and 34.7 per cent. Steel, phones, spare parts and machines also saw high export turnover.

Import turnover of automobiles with less than nine seats rose nearly 100 per cent in value and 140 per cent in quantity, while transport vehicles rose by 38 per cent and rubber rose by 103.4 per cent in terms of value.

Last month, Việt Nam’s trade deficit rose by $100 million after enjoying a trade surplus of $2.68 billion in 2016. The country’s total import-export turnover in January reduced by 13 per cent from last December, despite an increase against the same period last year. 

Vietnam Airlines to boost co-operation

Eighty-eight per cent of flights operated by national carrier Vietnam Airlines (VNA) and its members Jetstar Pacific Airlines and Việt Nam Air Service Company (VASCO) in the first two months of this year, including during the peak Tết (Lunar New Year) holiday period, were on time.

The airlines said the figure, an increase of 10 per cent compared with the same period last year, was cause for celebration, as the airlines had to operate in overloaded infrastructure, especially at Tân Sân Nhất International Airport.

VNA reported that its carriage of passenger was up 20 per cent during the period, a slight drop compared with last year’s recorded growth of 34 per cent.

VNA and VNA Group have pushed operations in key routes from Hà Nội, Hồ Chí Minh City and Đà Nẵng with a market share of between 64 and 67 per cent, and maintained its domestic route market share at 61 per cent.

While the firm’s costs remained stable over the first two months, the price of oil rocketed, causing additional costs of VNĐ300 billion more than the same period last year.

VNA and VNA Group have been looking for solutions to cope with the situation. They will focus on co-operation with other airlines of Skyteam to raise the efficiency of services. VNA will continue exploiting the international market with a passenger growth rate of 14 per cent.

With a fleet of wide-body aircraft including ten B787, six A350, six A330 and four B777, the carrier in the first two months occupied 90 per cent of the market share of domestic goods transportation. It has expanded services to export goods to foreign territories, including Europe and Japan.

First high-tech farming project begins in Thai Binh     

Construction of the first high-tech agriculture project in the northern province of Thai Binh was begun on Friday.

Located in the Dung Nghia Commune of the province’s Vu Thu District, the VND3 trillion (US$135 million) project will focus on growing organic vegetables and fruits, as well as high-quality rice.

The project will cover 3,000 hectares, of which 2,000 hectares will be reserved for paddy cultivation and rice production.

TH Group, the project’s investor, plans to make the project a production chain, beginning with the seed nursery, cultivation, harvesting, processing, packaging and product distribution.

Also, the production will comply with Global Good Agricultural Practice (GAP) and Organic Standards to meet the “Five zero” goals (no chemical fertilisers, no chemical pesticides, no growth stimulation, no preservatives and no genetically modified seeds). 

Chairman of the provincial People’s Committee Nguyen Hong Dien noted that this is the province’s first hi-tech project in the field of agriculture.

When coming into operation, it will help build and develop a technology model to grow organic vegetables and high-quality rice, meeting the increasing demand for safe food consumption and exports.

Dien asked local agencies to encourage businesses to rent agricultural land and actively assist investors by creating a friendly and safe investment environment, and by quickly solving difficulties arising during the implementation process.

Further, Thai Binh Province commits to accompany enterprises, as well as study the mechanisms and policies to create the most favourable conditions for TH Group's long-term and efficient investment in the area, the chairman noted.

Speaking at the ceremony, Deputy Prime Minister Trinh Dinh Dung said that he appreciate TH Group for investing in this high-tech agricultural project, which will pave the way for more businesses to invest in this area.

Additionally, he asked localities to continue to improve the investment environment and accumulate land to serve large-sized agricultural projects. He also called on enterprises to invest in high-tech agriculture to increase the added value in the agricultural sector, while creating more jobs for local people.

Since 2009, TH Group has also been operating a $1.2 billion, 37,000ha hi-tech dairy and fresh milk production project in the central province of Nghe An’s Nghia Dan District.   

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