Viglacera gets approval to list shares     

The Ho Chi Minh Stock Exchange (HoSE) has approved the listing of the State-owned glass and construction ceramics producer Viglacera on the southern bourse.

Viglacera will list 448 million shares on the southern market with the code VGC – the same ticker it has on the Ha Noi Stock Exchange (HNX).

The total value of the listed shares is VND4.48 trillion (US$191.6 million).

The HoSE listing will help Viglacera increase its stock liquidity and facilitate the Ministry of Construction’s sale of its 54 per cent stake in the firm during the first quarter of this year.

The change of listing will also help Viglacera’s shares attract more attention from investors.

In 2018, the company earned VND600 billion ($26.1 million) in pre-tax profit, up 6 per cent against 2017.

On Thursday, VGC shares on the HNX ended trading up 1.15 per cent, settling at VND17,600 per share.

Viglacera was established in 1974 under a decision by the Ministry of Construction. In 2014, the company was equitised with a charter capital of VND2.64 trillion ($115 million).

Pan Group withdraws all capital at two affiliates     

Vietnamese agriculture and food company PAN Group JSC has sold all its capital contribution at PAN Pacific Company Limited and PAN Pacific Services Company Limited, the company announced in a statement published on its website.

The information of the buyer was not disclosed.

The capital contribution accounted for 20 per cent of the charter capital of PAN Pacific and 20 per cent of the charter capital of PAN Pacific Services.

Therefore, the two above bodies are no longer affiliate companies of the PAN Group.

According to the consolidated financial statement for the third quarter of 2018, PAN Group’s investment in these two affiliates was worth about VND19.5 billion (US$833.7 million).

In September, The PAN Group completed a private placement of 13.4 million shares with the price VND61,000 per share for its Japanese strategic partner Sojitz Group, earning VND817.4 billion.

The proceeds helped PAN Group have more financial resources to invest in M&A projects in the agricultural and food sectors.

At the extraordinary General Meeting of Shareholders (AGM) at the end of October, The PAN Group also approved the limitation of foreign ownership at 49 per cent.

Currently, foreign investors hold 45.19 per cent of the group’s stake, notably Tael Two Partners Ltd and PYN Elite Fund. 

A single rally session doesn’t mean immediate recovery     

Last week’s share ‘fire sale’ may have ended trading on a positive note, but analysts have warned the single gaining session does not mean the market’s downtrend has stopped.

The benchmark VN-Index on the Ho Chi Minh Stock Exchange climbed 0.31 per cent to end last week at 880.90 points. It declined 1.3 per cent last week.

A similar scenario was also seen on the northern market. On the Ha Noi Stock Exchange, the HNX-Index gained 0.32 per cent to end last week at 100.85 points. It has decreased 3.25 per cent on a weekly basis.

An average of more than 185 million shares was traded in each session last week on the two exchanges, worth VND3.2 trillion (US$139 million).

The market suffered strong selling pressure last week but positive signs appeared at the weekend as strong bottom fishing demand helped VN-Index end the trading week with a rally.

“Just a rebound session is not enough to deduce that the bearish period of the market in the past three weeks had come to an end. Investors were quite cautious and concerned about the possibility of a market bull trap,” said Tran Minh Hoang, head of Research & Analysis Department, from Vietcombank Securities (VCBS).

A bull trap is a false signal that indicates a declining trend in a stock or index has reversed and is heading upwards when, in fact, the security will continue to decline.

“Recently it is estimated that in seven out of the past eight years, the VN-Index increased in January. However, the similar trend was not seen in the first three trading sessions of this year,” said Hoang Thach Lan, head of the individual investor department at Viet Dragon Securities Co (VDSC).

“Stock indexes are not as seasonal as the normal economic indicators but they reflect expectations or worries of market traders to the momentary information, which, at the current time, includes the risk of world economic recession. I don’t have high expectations in January,” Lan said.

The Vietnamese market is currently influenced by investors’ psychology, which is affected by both domestic and international information.

Foreign investors had been net buyers for seven straight sessions from December 24 last year before slightly net selling last Friday, which indicated they were not as worried as domestic investors, Lan said, adding that the movements of the VN-Index and stock prices in the coming weeks are difficult to forecast and may fluctuate based on the daily movements of major stock indexes from the US and Asian markets, he said.

Tran Minh Hoang from VCBS said the reason for the market’s rebound in the short term is not really clear. Investor sentiment is still quite cautious. Although bottom fishing has appeared, the demand was still weak and not strong enough to support the market.

“It is likely the indexes will continue to go up and down in the next few weeks before the 2018 business results of listed companies are gradually announced,” Hoang said.

Chau Thien Truc Quynh, director and head of local brokerage at Viet Capital Securities, said investors who take risks and prefer short-term trading could start tracking the stocks that were already in their portfolios or stock codes that are forecast to have good business results in 2018 and good fundamentals and positive growth prospects for 2019.

Central bank focuses on bad debt settlement in 2019

The Government has directed the State Bank of Viet Nam (SBV) to focus on the settlement of non-performing loans (NPLs) in 2019 with the aim of bringing the NPL ratio of credit institutions – excluding those sold to the Viet Nam Asset Management Company (VAMC) – to below 2 per cent from the current 2.16 per cent.

SBV must also urge the VAMC to recover bad debts it bought from credit institutions so that the total NPLs of the entire banking systems can be reduced from the current 6.6 per cent of total outstanding loans to below 5 per cent, the Government noted in a resolution released early this week.

To meet the target, the Government requires the SBV to implement legal regulations issued in the past two years to settle bad debts, including the National Assembly’s Resolution 42/2017/QH on settling bad debts of credit institutions, the revised Law on Credit Institutions and the Government’s project on restructuring the system of credit institutions associated with bad debt handling until 2020.

According to SBV governor Le Minh Hung, the SBV has so far actively implemented policies to restructure the banking system and deal with bad debts.

In November last year, Governor Hung issued two documents, instructing credit institutions to better implement Directive No 05/CT-NHNN, which was issued in September to regulate the structure of credit institutions associated with dealing with bad debts. Under the directive, credit institutions must review and provide detailed roadmaps and solutions for settling their bad debts every year until 2022.

Credit institutions were also required to actively look for buyers for the debts they sold to the VAMC while the VAMC was asked to speed up the handling of bad debts and collateral that the company purchased following market-based mechanisms.

In addition, SBV also issued many regulations and policies in line with international practices to improve safety standards in banking operation, which has contributed to enhancing governance and risk management capability under Basel II standards.

From 2012 to July 2018, the banking system settled VND794.2 trillion (US$34 billion) of bad debts. Particularly, since the National Assembly’s Resolution 42/2017/QH took effect in late 2017, the entire system has handled VND141.3 trillion of bad debts thanks to the resolution’s enhanced legal frameworks. Resolution 42 allows credit institutions and the VAMC to rapidly repossess collateral of default borrowers.

According to the development strategy of the banking sector to 2025 approved in August last year, SBV targets to reduce the ratio of bad debts to below 3 per cent of total outstanding loans by 2020. 

PM asks for prevention of illegal banknote exchanges

The management on exchanges of small banknotes would be tightened before, during and after the Tet holidays. 

Prime Minister Nguyen Xuan Phuc has asked the State Bank of Viet Nam to step up its management to ensure the reasonable use of small banknotes as Tet (Lunar New Year) holidays approach.

Violations in small banknote exchanges as well as in the exchange of foreign currencies and gold transactions must be handled strictly, Phuc asked.

With a month to go before the Tet holidays, demand for small banknotes has already seen a significant rise, especially for banknotes with denominations of VND10,000, VND20,000 and VND100,000, which were commonly used as ‘lucky money’, and denominations of VND1,000, VND2,000 and VND5,000, which were used as donations for pagodas and temples.

The fees for small banknote exchanges ranged from 10 per cent to up to 400 per cent on the black market, depending on the denomination.

According to Decree 96/2014/ND-CP, individuals violating money exchange regulations could be fined from VND20 million to VND40 million and the fines were doubled for organisations.

Phuc also asked the central bank to ensure adequate cash supply as well as smooth and secure operation of ATMs and POSs before, during and after the Tet holidays.

Close watch must be placed on the developments of the domestic and the world financial and monetary markets together with enhanced inspection on the operation of credit institutions and foreign banks’ branches to ensure system liquidity and safety.  

At the end of December, the State Bank of Viet Nam issued a directive asking credit institutions to ensure ATM service quality, safety and cash supply for Tet which will fall on February 5.

Lao Cai border gates break trade record     

Border gates in Lao Cai Province which borders China recorded trade value of US$3 billion in 2018, according to the customs office at the Lao Cai International Border Gate.

Nguyen The Hung, deputy head of the Lao Cai Border Gate Customs Sub-department, said the customs sector now offers 24/7 e-customs declaration and the sub-department has eased customs procedures for export goods, especially agricultural products. It has prioritised completing customs clearance as soon as possible to export all Vietnamese agricultural products in the morning.

Now, dozens of agricultural products are facilitated for export to China, such as dragon fruit, pepper, lychee, watermelon, mango, banana, cassava and potato.

Thanks to these efforts, last year, export value of agricultural products through the Lao Cai border gate reached $600 million, 60 per cent of total export value, Voice of Vietnam reported.

Nguyen Viet Quang, director of Lao Cai Customs Department, said businesses have enjoyed convenient customs procedures at border gates. Statistics showed that in 2018, 50 more businesses exported or imported through Lao Cai than the previous year.

In recent years, the province has won contracts due to having many trade promotion activities, such as a conference on connecting farming product importers and exporters between the two countries, an international trade conference, export promotion conference and the meeting of Vietnamese and Chinese export-import enterprises, according to the Lao Cai Department of Industry and Trade. 

Sao Khue Awards 2019 kicked off     

The Viet Nam Software Association (VINASA) launched the Sao Khue Awards 2019, the most prestigious honours for the Vietnamese IT and software industry, on Thursday.

This year is the sixteenth year of the event. Over 15 years, the programme has honoured and awarded titles to 530 outstanding Vietnamese IT products, software solutions and services.

Sao Khue has become the most prestigious title for the Vietnamese IT industry, which is trusted and appreciated by the Vietnamese IT business community and market.

This year is also the first year that the country hosted Asia Pacific ICT Alliance (APICTA) awards. Therefore, this year’s Sao Khue programme will have changes in evaluation and voting criteria.

Under the plan, businesses can register products, services and solutions to join the programme from now to March 5.

The voting will take place in March and the award ceremony will be held in Ha Noi in April.

Participants can register online at http://dangky.danhhieusaokhue.vn/.

Truong Gia Binh, VINASA chairman, head of the organising committee, said that in the context of the fourth industrial revolution, digital transformation played an important role for agencies, organisations and enterprises.

The Sao Khue Awards would take the leading role in promoting digital transformation, he said.

The changes in organisation and implementation this year, especially the expansion of the start-up category, and the connection with the international awards APICTA would help Viet Nam gain a higher position on the world technology map, the chairman added. 

Macadamia, chestnut, almond plant opens     

Viet Bao Ky Agricultural Products Processing Co., Ltd on Thursday opened and put into operation the Tan Ky-Bao Ky factory, processing macadamia, chestnuts and almonds, in the central province of Thua Thien-Hue.

Pham Huu Thuong, Director of Viet Bao Ky Agricultural Processing, said the factory operated the first ever processing line of macadamia, chestnuts and almonds in Viet Nam with total investment of over US$5 million dollars, of which $2 million was spent on phase 1 of the plant.

Raw materials are imported from the US.

Tan Ky-Bao Ky agro-processing factory, located in the An Hoa industrial cluster, has a capacity of 5 tonnes per day. It is divided into different areas, comprising of an input material area, factory area which includes material cleaning machine, mixing machine, drying machine and packing machine.

Products are packaged, sterilised and stored in the best conditions.

Thuong said the company’s processed macadamia, chestnut and almond products meet all quality and food safety standards.

Industrial park installs solar system     

Skylight, a joint venture between BCG Energy and Indefol Engineering Solutions, on January 4 put into operation a rooftop solar power system at the Dinsen Industrial Park in the southern province of Long An.

It has a total capacity of 1MW and this is Skylight’s first system out of a proposed 6.4MW Skylight plans to install at Dinsen IPs in Viet Nam and Cambodia this year.

It costs more than US$7 million and includes a 100KW inverter.

The power produced will be used in the IP and any surplus will be sold to the national grid.

This project is supported by German cooperation organization GIZ while HD Bank is the credit sponsor.

The system can reduce CO2 emissions by up to 25,000 tonnes during the project’s life cycle.

Besides, the installation of the solar panels reduces the heat absorption by the roof.

BCG Energy is a member of the BCG Group, which has interests in agricultural manufacturing and trading, infrastructure and real estate, renewable energy, and construction.

Indefol was founded by a group of alumni from the HCM City Polytechnic University to research into alternatives to fossil energy.

Central province approves hi-tech farms     

The central province of Quang Nam has approved hi-tech farming and agriculture park projects in Thang Binh District and the township of Dien Ban on 425 hectares of land with total planned investment of VND5.4 trillion (US$239 million) by 2024.

The project, which will begin construction in the first quarter of this year, will develop a vegetable and flower farm that applies advanced technologies. It will also establish a produce processing zone and infrastructure as well as livestock farms and a service area on 278ha in Binh Duong Commune, east of Quang Nam Province.

The province also agreed to let T&T Group develop a 147.72ha hi-tech farm park and R&D (research and development) zone in Dien Ban Town.

These will be the first two privately backed hi-tech agriculture projects in the province and central Viet Nam.

According to the firm, the two projects will start production in 2024.

Earlier, two investors – Truong Hai joint-stock company and Hoang Anh Gia Lai – had agreed to a joint-venture agroforestry project with total investment of VND13.8 trillion ($611 million) in the province. It focused on fruit cultivation and furniture production for export.

The province also designed an acclimatisation strategy to bring Ngoc Linh ginseng from Ngoc Linh Mountain (between Quang Nam and Kon Tun provinces) to mountainous areas nationwide for mass development as a key crop to boost income among ethnic groups.

At an investment promotion conference in 2017, Quang Nam granted investment licences to 32 projects with a total registered capital of $15.8 billion. To date, the central province has attracted 135 foreign direct investment (FDI) projects with registered capital of nearly $5.5 billion.

The province has 857,628ha of protected forest and farm land – 82 per cent of the province’s area – 115,000ha of which is reserved for agricultural production.

According to the latest report, the agriculture, seafood and forestry industries earned VND13 trillion ($575 million) of revenue in 2017.

Quang Nam also approved a conservation programme for eight precious and endangered plants including ginseng, codonopsis, pepper, cinnamon, rattan and white corn. 

HCMC’s Tet gift hamper market

Ly Kim Thu of HCM City’s District 3 was choosing gift hampers at a supermarket near home for Tet (Lunar New Year) holidays, which fall on February 5 this year.

Thu said: “At the end of every year I buy five to six hampers to gift my relatives. Tet gifts this year are varied in terms of items, designs and prices, making it easy to find what we require.”

With a month to go, the gift market is already buzzing with supermarkets, markets and shops offering a range of items for both business and individual customers.

Saigon Co.op, which owns the Co.opmart, Co.opXtra and Co.op Food, is offering more than 50 options, including 12 at prices ranging from VND125,000 (US$5.4) to VND299,000 million ($12.9) and the rest at VND299,000-2 million ($86.2).

They also pack gifts of any value and quantity on customers’ orders, and take orders from January 4 to 25 for free delivery in any province or city that has a Co.opmart or Co.opXtra store.

The hampers usually have confectionery, tea, coffee, cashew nut, sugar coated fruits, wine, and beverages.

Some have cooking oil, sugar, seasoning, fish sauce, sausages, among others.

There are also fruit hampers.

Saigon Co.op’s supermarkets together expect to sell an average of 10,000 a day.

South Korean supermarket chain Lotte Mart is selling more than 30 kinds of gift hampers at VND209,000-3.33 million ($9 -143.4).

Big C supermarket has 33 kinds of hampers and boxes at VND78,000-2 million. This year it is offering some unique items with specialities from various parts of the country and organic products.

Shops at traditional markets like Tan Dinh, Thi Nghe and Ba Chieu and many websites are also selling gift hampers.

Demand for gift hampers is expected to increase by 20 per cent this year, with those priced at VND500,000-1 million expected to be bestsellers.

According to retailers, consumers should buy only from reputed places and brands to ensure they get quality items.

Son Duong deep-water port ready to receive 28 million tonnes of cargo this year     

The Son Duong deep-water port in Ha Tinh Province is expected to receive 28 million tonnes of cargo from roughly 1,500 ships in 2019, according to the Formosa Ha Tinh Company.

In 2018, the port welcomed more than 21.6 million tonnes of cargo from 1,095 ships.

The main imports at the port were ore, coal and equipment for production at the Formosa Ha Tinh Steel Corporation (FHS). The port also processed the exports of FHS’s rolled steel and wooden chips, reported infonet.vn.

The cargo volume that passed through the seaport was at a record high last year because FHS Company came into stable production, increasing demand for imports of raw materials. Exports of finished products also increased, accounting for 80 per cent of the total company’s output.

On January 3, Formosa Ha Tinh said the water port had completed construction of 12 wharves and was equipped with 19 modern cargo-handling machines.

The port is under the project of Formosa’s iron and steel complex in the province’s Vung Ang economic zone. It sits on an area of more than 1,018.3 hectares and can receive ships transporting iron ore and coal with a capacity of up to 200,000 tonnes.

An Giang Province exports grow     

An Giang Province’s exports grew by 2.43 per cent last year to US$840 million to comfortably achieve the target set at the beginning of the year.

With its favourable geographic location, the province has demonstrated its strength as a trading gateway and its exports have been growing steadily, said Vo Nguyen Nam, director of the province’s Department of Industry and Trade.

The province lies on the Cambodian border and has border checkpoints at Tinh Bien District and Tan Chau Town, two in An Phu District and numerous smaller ones, which help facilitate trade.

Its main exports are seafood, rice, clothing, and frozen vegetables, and its main markets include the Philippines, Malaysia, Cambodia, and Singapore.

The province plans to gather information about more markets to aid exports and organise more trade facilitation activities.

It will help firms export to Cambodia by studying provinces in that country where demand for Vietnamese goods is high and apprising local companies about Cambodia’s trade policies.

It aims to achieve exports of $890 million this year.

An Giang is one of the Mekong Delta’s key economic hubs along with Kien Giang and Ca Mau provinces and Can Tho City. 

Rubber exports rise in volume but decrease in value
     
Natural rubber export prices have been falling since the second half of 2017, which has led to revised business plans for 2019.

Last year, the country exported 1.58 million tonnes of rubber, worth US$2.1 billion, an increase of 14.5 per cent in quantity but a drop of 6.6 per cent in value compared with the same period in 2017.

Rubber prices now stand at about $1,335 per tonne, a drop of 18 per cent compared with 2017.

China is the largest importer of Vietnamese natural rubber (65.3 per cent of total exports), and a key importer of rubber materials from Viet Nam.

About 70 per cent of China’s import volume is used to produce tyres.

Because of the US-China trade war, Viet Nam’s most affected export sectors are computers, furniture, automobile products and automobile tyres. Chinese products exported to the US that are related to Viet Nam’s rubber industry are also likely to be affected.

Rubber exports are expected to be low in the first quarter of the year because of the Chinese market slowdown.

In addition, the uneven quality of rubber products at Vietnamese factories make them cheaper than those from other countries, according to industry insiders.

Viet Nam mainly exports raw rubber with a low value, and imports a large number of rubber products for deep processing as the production of local rubber has not met the demand of domestic manufacturers.

To resolve the trade balance in rubber imports and exports, and to create an abundant supply of rubber materials for domestic production, the rubber industry has been advised to shift its products toward creating higher added value.

The rubber sector also needs to improve the quality and value of its products through the use of advanced technology in production, while expanding export markets and boosting trade promotions, experts said.

Viet Nam is one of the biggest rubber exporters in the world, with products exported to 128 nations and territories.

A report from the Viet Nam Rubber Association said that by the end of 2017 the country had 971,600ha of rubber trees, with a yield of over 1.08 million tonnes, accounting for 8.3 per cent of the total world yield. — VNS

The ratio of public investment to total social investment has been decreasing, while those of the private and foreign-invested sectors are increasing.

An increase in the incremental capital-output ratio (ICOR) should not be seen as a result of inefficient public investment, according to Deputy Prime Minister Vuong Dinh Hue. 

Public investment is mainly focused on infrastructure development, which facilitates growth indirectly instead of producing immediate result, Hue said in a response to National Assembly deputy Thach Phuong Binh from Tra Vinh province. 

ICOR is used as a measure of the inefficiency with which capital is used. The higher the ICOR, the lower the productivity of capital or the marginal efficiency of capital. 

In his enquiry, Binh expressed concern over the low efficiency of public investment, as the ICOR increased from 3.5 in the 1991 – 1995 period to 6.15 in 2007 – 2008. The ratio once soared to 8 in 2009 and declined to 6.21 in 2018, however, is still higher than the World Bank’s recommendable level.

Comparing to regional countries, Vietnam’s ICOR is nearly double the average, indicating the efficiency of public investment is less than half of others, Binh continued. 

According to Deputy PM Vuong Dinh Hue, the socio-economic impact of public investment has improved substantially in the 2011 – 2015 period, and Vietnam’s ICOR has been gradually decreasing. 

Hue said ICOR is often measured in phases and depends on numerous factors, including changes in technologies and the proportion of labor and capital being used. 

Vietnam’s ICOR takes into account public investment, state-run corporations’ investment, investment from the private and foreign-invested sectors, Hue added. 

Over the past few years, the government has stepped up efforts to improve efficiency in public investment in a bid to reduce the ICOR. Evidently, the ratio of public investment to total social investment has been decreasing, while those of the private and foreign-invested sectors are increasing, he stressed. 

In the future, Hue expected public investment would be concentrated on priority projects with significant impacts on Vietnam’s socio-economic development. 

Singapore’s Platinum Victory sets sight on Vinamilk’s extra US$95-million shares

Singapore’s Platinum Victory, a subsidiary of Hong Kong-based conglomerate Jardine Matheson, has registered to purchase an additional of 17.41 million shares in Vietnam’s largest dairy producer Vinamilk, according to the Ho Chi Minh City Stock Exchange (HoSE). 
 
If successful, Platinum Victory will increase its holding at Vinamilk to 11.62% or 202.29 million shares from the current 10.62%, or 184.88 million shares. 

At the current market price of VND125,000 (US$5.40) a Vinamilk share, the fund would need at least VND2.17 trillion (US$95 million) for this transaction, which is expected to be carried out from January 9 to February 7 via put-through and/or order-matching transactions on the HoSE. 

In 2018, Platinum Vicotry tried six times buying 14 – 17 million Vinamilk shares unsuccessfully, citing the unfavorable market conditions as reason. 

Platinum Victory currently is the third largest shareholder at Vinamilk, after State Capital Investment Corporation (SCIC) at 30.01% and F&N Dairy Investment at 17.31%. 

Backed by Jardin Matheson, one of Asia’s biggest conglomerates with revenue of US$16 billion in 2017, Platinum Victory is in a race with F&N Dairy Investment, a wholly-owned subsidiary of Fraser & Neave and owned by Thai tycoon Charoen Sirivadhanabhakdi, to increase their respective holdings at Vinamilk. 

Jardine Matheson, through its subsidiaries Jardine Cycle & Carriage (JC&C) and Platinum Victory, has invested in Vietnam for many years. 

Vinamilk sets its revenue target in 2018 of VND55.5 trillion (US$2.4 billion), up 8.5% yearly. Under the plan, Vinamilk estimated its after-tax profit to reach VND10.7 trillion (US$473 million), increasing 4.6% over 2017.

Vietnam's dairy industry posted revenue of over VND100 trillion (US$4.4 billion) in 2017, an increase of 10% over the previous year, with Vinamilk commanding a market share of around 50%, according to the latest statistics. 

Vietnam exported about 1.58 million tonnes of rubber in 2018 – worth 2.1 billion USD and up 14.5 percent in volume, but down 6.6 percent in value year-on-year, the General Department of Vietnam Customs reported. 

In December, the country earned 230 million USD from shipping 190,000 tonnes of rubber abroad, representing an increase of 12.7 percent but the value dropped 5.6 percent year-on-year. 

The price of rubber in the last month of 2018 increased as trade tensions between the US and China eased. 

As the world’s largest rubber consumer and tyre maker, China consumed 10.1 million tonnes of rubber in 2017. Up to 33 Chinese businesses have been listed among the world’s biggest tyre manufacturers. 

Major rubber producers such as Thailand, Malaysia, and Indonesia are expected to take measures to lift the price of rubber in the time to come.

Meanwhile, Vietnam ranks fourth in rubber production globally, with its annual rubber output exceeding 1 million tonnes since 2015. 

Vo Hoang An, Vice President and General Secretary of the Vietnam Rubber Association, said that over the past few years, rubber has been seen as one of the key sectors of the national economy. 

Despite various difficulties, its three main products – natural rubber, rubber products, and rubber wood – have experienced growth in export revenue, he said, adding that the sector contributed 3 percent to the country’s total export value of 215.1 billion USD in 2017. 

However, all machines and technologies used in the Vietnamese rubber industry are imported and the country has yet to participate much in the global rubber supply chain or put much focus on the support industry, An pointed out. 

It is forecast that rubber exports to China will be sluggish due to the slowdown in the country’s economy, he said, suggesting local businesses expand into other markets in order to ease their reliance on Chinese business. 

New circular on securities-related service prices issued

The Ministry of Finance has issued new securities-related service regulations for trading organisations and commercial banks doing business in Vietnam’s stock market.

The new circular, No 128/2018/TT-BTC, replaced Circular No 242 dated November 11, 2016 setting price frameworks.

Overall, the maximum service prices remain unchanged. However, the new regulation adds charges in the derivatives market.

For the underlying stock market, the price of underwriting service for State-owned enterprises carrying out equitisation is between 0.5 percent and 2 percent of the total value of shares issued through a guaranteed offering.

The maximum price of brokerage service to buy/sell shares or fund certificates (including listed securities and securities registered for trading) is 0.5 percent of trading value. The brokerage service price for divestment of State capital shall not exceed 0.03 percent of trading value and not go over 3 billion VND per transaction.

The service price of managing public securities investment funds or public securities investment companies shall not exceed 2 percent of the net asset value (NAV) of the fund or the portfolio per year.

The ceiling price of service of issuance of certificates of open-end funds or exchange-traded funds (ETFs) is 5 percent of trading value, while the price of service of redemption or switch of certificates of open-end funds or EFFs shall not exceed 3 percent of trading value.

Regarding share auctions, price of service will be from 20 million VND per auction of shares or each type of securities to 0.3 percent of total value of securities actually sold out.

For the derivatives market, price of brokerage services for futures contracts is up to 15,000 VND per index and up to 25,000 VND per government bond. These prices do not include the service prices for trading, management of derivative positions, security deposits which securities companies must pay to the stock exchanges and the Vietnam Securities Depository Centre.

For the services not prescribed in the circular, securities trading companies and commercial banks may themselves decide the prices of their services but must comply with the Law on pricing and relevant laws.

Prices of securities-related services are not subject to value-added tax. Providers of services must clearly announce prices of their services.

The new regulation takes effect on February 15 this year.

Tra Vinh province strives to lure more investors in 2019

The Mekong Delta province of Tra Vinh will adopt a range of measures to improve its provincial competitiveness index in 2019 in an effort to attract more investors. 

Chairman of the provincial People’s Committee Dong Van Lam said the province set the goal of raising business support index by 20 places, workforce training by 15-18 places, market participation by 10-13 places; transparency, activeness and vanguard of local authorities by 10 places, legal institution and social security and order by 3-5 places, and fair competition by 2 places. 

The provincial People’s Committee directed the provincial business association, the Department of Planning and Investment, the management board of economic zones, departments and agencies to hold dialogues with enterprises at least twice per year to remove their difficulties. 

Leaders of the province will also maintain meetings with businesses on the second Saturday of each month.

The provincial Centre for Public Administration was asked to create favourable conditions for individuals and firms to save unofficial costs and shorten time for their market access. 

The province will also continue refining mechanisms and policies related to business development and start-up support so as to create a community of enterprises capable of joining sectoral linkage activities and value chain in production. 

Thanks to improving its administrative reform and business environment, Tra Vinh attracted 76 projects with a total registered capital of more than 248 million USD in 2018, compared to 52 projects in the previous year, Lam said. 

The province is now home to 283 projects, including 39 foreign-invested ones worth 3.25 billion USD and 244 domestic projects valued at more than 101.6 trillion VND (4.37 billion USD). 

A large number of investors from Japan, the Republic of Korea, China, Germany, Belgium, Russia and Thailand have come to learn about the local business environment.

76.6 million USD veggie processing plant inaugurated in Tay Ninh

Lavifood Joint Stock Company officially put into operation its Tanifood vegetable and fruit processing plant in the southwestern province of Tay Ninh on January 6, hoping to make international-standard products for export to the US, the European Union, the Republic of Korea, Japan and Australia.

At the inauguration ceremony, Deputy Prime Minister Truong Hoa Binh emphasised the importance of the plant to the country’s agriculture. He asked Lavifood leaders to better the quality of products and enhance competitive capacity to make more contributions to the agricultural product processing sector.

Provincial authorities should accompany and support the company to raise the value of vegetables, while competent ministries and sectors must continue providing assistance, and removing bottlenecks for it, he added.

According to Minister of Agriculture and Rural Development Nguyen Xuan Cuong, the plant was established in a potential land with some 400,000 hectares of fertile soil, and more than 30,000 industrious farmer households.

“If there are more plants like this, Tay Ninh province will get rich from agriculture”, he stressed.

The 15-hectare Tanifood plant was constructed in Thanh Duc commune, Go Dau district, at a total cost of 1.78 trillion VND (76.6 million USD). It is the first fruit processing factory in Tay Ninh and the largest in the country. 

Equipped with advanced technologies from Germany, Sweden, Italy and Japan, the plant includes a production line for fresh fruits and vegetables and heat treatment with a total capacity of 10,000 tonnes per year, a frozen fruit and vegetable production line with a capacity of 20,000 tonnes, a production line for drying, soft-drying and sublimation drying of fruits and vegetables, and a line for producing condensed fruit juice. 

Pham Ngo Quoc Thang, General Director of the Lavifood JSC, said that the birth of Tanifood will help increase value of Vietnamese farm produce, and improve incomes of local farmers, from 0.26 USD per square metre to 3.6 USD per square metre.

Vietnam likely to be affected by RoK’s tougher pesticide rules

In 2019, the Republic of Korea (RoK) will tighten rules related to use of pesticides for agricultural products it imports, and Vietnam is expected to be affected.

With the advent of the Vietnam–Korea Free Trade Agreement in 2015, it has become much easier for Vietnamese agricultural and seafood products to enter the Korean market.

But the new regulations could change things since Vietnam still uses many types of pesticides in key export products such as coffee, peanut, cashew, and fruits that it has not registered with the RoK.

The RoK has approved a list of 370 kinds of pesticides and all imported agricultural products are carefully checked when they land in its ports.

According to the Korean Trade and Investment Promotion Agency (KOTRA), imports of foods have increased sharply and authorities have to tighten oversight.

In 2016, the country unveiled a pesticides list to improve food safety, applying it now to tropical fruits and various seeds, and it will apply to all agricultural products from the beginning of 2019.

KOTRA also reported that in 2015 – 2017 many Vietnamese products were refused entry into the RoK because of high pesticide content or use of unapproved pesticides.To find a solution, Vietnamese authorities strengthened their ties with their Korean counterparts.

The Ministry of Agriculture and Rural Development’s Plant Protection Department has worked with the Korean Animal and Plant Quarantine Agency to supervise processing of dragon fruits and mango before exporting to that country.

Vietnam has also provided all information about star apple, longan, litchi, and rambutan to the agency.

To help Vietnamese enterprises export agricultural products to the RoK, the Ministry of Agriculture and Rural Development has made regulations for the registration, manufacturing, trading, and usage of pesticides more stringent and set up propagation models to promote biological pesticides, targeting 30 per cent use of biological pesticides by 2020,” said Bui Thanh Huong of the Plant Protection Department .

The Department has stepped up oversight of the use of pesticides and provides companies with information about new food safety regulations in importing nations.

EVN records 15 percent rise in total revenue for 2018

The state-owned Vietnam Electricity (EVN) obtained a number of achievements despite many difficulties in 2018, said EVN Deputy Director General Nguyen Tai Anh.

At a meeting to review the group’s performance in Hanoi on January 3, Anh said the power volume produced and purchased last year reached 212.9 billion kWh, up 2.4 billion kWh from the target set and 10.36 percent from 2017.

These figures have helped Vietnam’s Getting Electricity (GE) indicator jump 37 places to 27th among the 190 economies listed in the World Bank’s Doing Business 2019 report.

EVN was rated BB by Fitch Ratings last year, the executive said, adding that this positive credit rating can help the firm attract investment and power projects.

Additionally, the EVN was named among the sustainable Vietnamese enterprises in 2018 by the Vietnam Business Council for Sustainable Development, and one of the leading state-owned firms in terms of information transparency by the non-profit consulting company Towards Transparency.

Anh reported on the profitable production and business activities for the group last year, elaborating that it gained 340.5 trillion VND (14.6 billion USD) in total revenue, up 15 percent from 2017. This included nearly 333 trillion VND in electricity sales, up 14.6 percent.

The power supply reliability has also been improved as the System Average Interruption Duration Index (SAIDI) fell 30 percent from the previous year to 723 minutes. The SAIDI of EVN’s subsidiaries declined by 18-39.5 percent.

Meanwhile, the rate of power loss for the whole business is estimated at 6.9 percent, reaching the target set by the Government one year ahead of schedule.

Addressing the meeting, Deputy Prime Minister Trinh Dinh Dung said that the electricity sector is facing the risk of a power shortage as the demand for power is growing fast – rising by upwards of 10 percent each year, exceeding the sector’s supply capacity.

Therefore, the sector needs to make breakthroughs in electricity infrastructure development, he said, asking the EVN to improve its operation effectiveness to reduce power prices, reorganise its apparatus, improve service quality, and ensure environmental protection is maintained at thermal power plants.

The year ahead is predicted to be a difficult one for EVN. However, the group still targets a 9.2-percent increase to hit 232.5 billion kWh in the electricity produced and purchased in 2019 so as to prepare for higher demand.

It also aims to reduce the SAIDI to 400 minutes and the power loss rate to 6.7 percent next year, Anh said.