Japanese investors explore Ha Nam’s investment environment

Ha Nam province will create favourable conditions to attract more Japanese businesses to invest in local projects, said Vice Chairman of the provincial People’s Committee Truong Quoc Huy.

During his working session with a business delegation from Japan’s Nagahama city on November 5, Huy affirmed that Ha Nam always considers Japan an important partner in cooperation and investment attraction.

Enterprises investing in Ha Nam will be supported in terms of electricity, water, worker recruitment and security, he said.

The province has earmarked Dong Van III Industrial Park, which has a favourable location and well-built infrastructure, for Japanese investors, the official said.

Huy told his guests that Ha Nam highly evaluated Japanese companies’ investment capacity and cooperation, adding that Japanese firms have always observed their investment commitments to the province, had good working environments and ensured stable incomes for local workers.

Ha Nam is now home to 226 foreign direct investment (FDI) projects with combined registered capital of 2.5 billion USD, including more than 70 Japanese-invested projects worth over 800 million USD focusing on manufacturing, automobile, motorbike and electronic equipment production.

Mayor of Nagahama Fujii Yuji, head of the delegation, said two firms from Nagahama have been investing effectively in Ha Nam thanks to support from the local authorities. Many other companies of Nagahama also want to study investment opportunities in the province, he added.

Yuji called on the provincial authorities to continue assisting the two Nagahama businesses and create favourable conditions for other enterprises to learn about the local investment environment as well as helping them recruit highly-skilled workers.

HCM City economy not on course to achieve 8.3 per cent growth target

HCM City must accelerate economic growth to achieve this year’s target of 8.3 per cent, a government meeting held yesterday to review socio-economic development in the first 10 months heard.

“Trade, service and tourism must achieve a high growth rate of 9 per cent in the last two months of this year to achieve the 8.3 per cent target,” Nguyễn Thành Phong, chairman of the city People’s Committee delivered, said.

“This is the year-end season and goods produced for festivals are expected to increase by 20 per cent year-on-year,” a Department of Industry and Trade official said.

“We believe this would bring significant growth in food and drink and retail sales. In addition, key industries like chemicals, textile, footwear, and engineering have achieved good growth and the year’s growth target will be achieved.”

The tourism industry has confirmed it would achieve the year’s targeted foreign arrival numbers.

“In the first 10 months the city received 6.1 million foreign visitors and another 1.5 million will come in the last two months,” a tourism department official said.

Room bookings are up 10 per cent from last year.

“Tourism promotion by HCM City is still limited with many countries not knowing about our tourism potential. The Department of Tourism must soon submit its strategies for tourism development in collaboration with other industries to the People’s Committee to create new products,” Phong said.

He instructed the Department of Natural Resources and Environment to report on land management.

Nguyễn Toàn Thắng, the director of the department, said the department had reviewed land usage at 2,822 projects and 1,497 plots of land which were allotted, rented or sold in 2012 –17.

“We will report the entire situation to the People’s Committee next week to resolve all related problems.”

Phong urged the department to resolve incomplete land procedures in some projects saying this has caused trouble for investors since they cannot do anything with the land [until the procedures are completed].

“We must stop the situation of State-owned enterprises using land for wrong purposes. We must repossess land and auction if necessary.”

The city’s revenue collections in the first 10 months increased by almost 10 per cent to VNĐ306.3 trillion ($13.3 billion).

FDI grew to nearly $6.22 billion, an increase of 23.7 per cent for last year.

Exports were worth around $31.3 billion, an increase of 7.1 per cent.

Services and retail sales grew by 12.9 per cent and industrial output by 7.85 per cent.

The city’s four key industries -- engineering and automation; electronics; chemicals, rubber, plastics; and food processing -- continued to perform strongly, expanding markets, investing in technology and improving quality and competitiveness, and growing at nearly 7.8 per cent.

This year 35,585 new companies with a combined registered capital of VNĐ810 trillion ($35.2 billion) have been licensed, 13 per cent up from the same period last year.

Job creation, vocational training and support for poor people have been carried out efficiently to ensure social welfare.

The number of jobs created rose marginally to 129,000. 

Thua Thien-Hue sets to draw 10 trillion VND investments

 The central province of Thua Thien-Hue is striving to attract 15 domestic and foreign investment projects with total registered capital of some 10 trillion VND (428.8 million USD) in 2018.

Priority will be given to investments in the sectors of its strengths like tourism, real estate, IT, high technology, healthcare, education, high-tech agriculture and support industry.

According to Phan Thien Dinh, Director of the Investment Promotion and Business Support Centre and Director of the provincial Department of Planning and Investment, by the end of this year, the province will work to attract prestigious domestic investors, who are credible partners of domestic and foreign banks and investment funds.

It has held investment promotion campaigns in such traditional markets as Hong Kong (China), Japan, Singapore, Thailand, Europe, the Republic of Korea, and the US, and in the countries which could benefit from free trade agreements that Vietnam has inked. 

The province’s agencies have proactively evaluated potential, market and investment promotion trend as well as built a database in service of tourism promotion, particularly for the Chan May-Lang Co economic zone, industrial parks, An Van Duong new urban area and Hue city.

Along with enhancing training to improve local staffers’ capacity of investment promotion, the province has paid due attention to supporting businesses in studying legal regulations, policies and investment procedures as well as carrying out their projects after receiving investment license.

Thua Thien-Hue has secured 40.6 trillion VND (1.74 billion USD) in investments so far, including more than 3.2 trillion VND (137 million USD) landed by domestic investors and 1.6 billion USD by foreigners.

Phong Dien solar power plant, with a capacity of 35MW, is a notable project. It was invested by the Gia Lai Electricity JSC at the total cost of nearly 1 trillion VND (42.83 million USD). The 48-hectare factory was constructed in January this year and began operating on October 5. 

The plant is designed to produce 60 million kWh of electricity each year and is expected to greatly contribute to local socio-economic development. It is set to expand its capacity by another 29.5 MW in 2019.

Quang Tri moves to lure investors into coastal areas

The central province of Quang Tri has been making effort to draw investors into its coastal areas, tourism, and sea ports.

“The province is working to create new trust to attract strategic investors into the locality,” Secretary of the provincial Party Committee Nguyen Van Hung said.

By the end of October 2018, the province had over 3,400 enterprises, 78 percent of which are micro-sized businesses, 20 percent are small-sized ones, and the rest of 1.4 percent, medium ones.

In order to achieve a high economic growth, it has had a plan to attract investors, especially those with large-scale and large investment projects in its coastal areas.

At present, the locality is concentrating resources on clearing land and building infrastructural facilities for its southeastern coastal economic zone, which covers nearly 24,000 ha, spanning 17 communes and towns in the districts of Hai Lang, Trieu Phong, and Gio Linh.

Incentives regarding land rent, income and corporate tax, and project location have been offered to those investing in the zone as the locality has defined the area as a priority place for strategic investors.

Daewon of the Republic of Korea, VSIP of Singapore, Amata of Thailand, Sumitomo of Japan, and Korea Land & Housing Corporation of the Republic of Korea have come to explore investment opportunities in industrial infrastructure, urban areas, energy and seaports there.

Meanwhile, Thai, Korean and Russian investors are working on projects to build two thermal power plants with the capacity of 1,320 MW each, and a 340MW-gas-fueled power plant.

The construction of the main road of the zone with the length of 23.5 km running through seven communes of Hai Lang and Trieu Phong districts is being sped up. The road is expected to be completed in June, 2019.

For its northeastern coastal area, Quang Tri has set to prioritize investors interested in sea tourism and resort development as it aims to turn its Cua Tung-Cua Viet-Con Co sea triangle into a key sea tourism site in the country.

Deputy Director of the provincial Culture, Sports and Tourism Department Nguyen Van Chien said the province has adopted a policy to attract big investors to develop the Cua Tung-Cua Viet-Con Co sea-tourism triangle.

FLC, a big property developer in the country, is interested in developing an urban-resort complex covering hundreds of hectares in the coastal areas of Cua Tung and Cua Viet. Meanwhile, the AE Group is building the AE Resort on 36 ha in Cua Tung area from now to 2021. 

Regarding the sea port development, Quang Tri is working on the construction of My Thuy sea port in Hai Lang district in the southeastern economic zone.

The Prime Minister’s Decision 1037/QD-TTg dated June 24, 2014, referred to the planning of My Thuy port till 2020 with a vision to 2030, targeting to create the shortest sea traveling distance for commodities hailing from the southern region of land-locked Laos, Thailand’s northeastern area, and Cambodia’s northeastern region along the 1,450-km East-West Economic Corridor.

Early this year, Rich & Wise Co. Ltd. and the My Thuy International Port Joint Venture Company presented financing contracts and memorandums of understanding on the My Thuy sea port project.

Accordingly, the construction of My Thuy sea port will be from 2018 to 2025. With total investment of 637 million USD, the port will have 10 wharves with total length of 3.3 km when it becomes operational.

The Cua Viet sea port has its planning approved in 2017, under which it will have a total area of 120 ha, capable of handing 1.6-2.1 million tonnes of cargo a year by 2020, and 3.3-4.3 million tonnes a year by 2030.

Many localities face difficulties in industrial cluster management

Many localities have reported difficulties in implementing the Government’s Decree 68/2017/ND-CP on the management and development of industrial clusters, said Ngo Quang Trung, head of the Ministry of Industry and Trade’s Department of Local Industry and Trade.

Speaking at a conference in Hanoi on October 20 to review one year of implementation of the decree, Trung said that Decree 68 has created a uniform and clear legal corridor, thus helping attracting investment for industrial development in localities.

However, Trung acknowledged that the decree has yet to be implemented strictly and fully in some localities, citing some violations in Thanh Hoa and Thai Binh provinces.

The coordination among departments remains poor in enforcing regulations on one-stop administrative procedures for industrial clusters, he said.

Trung noted that currently, Vietnam has 807 industrial clusters covering 26,565 hectares of land, 680 of which have become operation.

However, only 117 clusters have operational waste water treatment system, accounting for 17 percent of the operating clusters.

Particularly, investment attraction of industrial clusters has failed to meet the set targets, along with goals in environmental treatment and supporting infrastructure.

Deputy Minister of Industry and Trade Cao Quoc Hung said that the Ministry will continue building a decree amending a number of articles of Decree 68 and will submit it to the Government in the fourth quarter of 2019.

A target programme on budget support for infrastructure investment of industrial clusters in the 2020-2025 period will also be submitted to the Prime Minister within this year.

Meanwhile, the ministry will also coordinate with other ministries and sectors to design and complete institutions for industrial clusters, and share information in State management in the field.

Deputy Minister Hung stressed that the ministry will also keep a close eye on the development of industrial clusters in localities from planning to infrastructure building and during their operation.

FLEGT-VPA to fuel Vietnam’s wood export to global markets

Vietnam’s signing of the Forest Law Enforcement, Governance and Trade Voluntary Partnership Agreement (FLEGT-VPA) with the European Union (EU) will help the country boost wood product exports to not only the EU but also many other markets, according to an official.

The remark was made by Nguyen Tuong Van, Deputy Director of the department for science-technology and international cooperation under the Vietnam Administration of Forestry, at a seminar in Hanoi on October 31.

Vietnam and the EU signed the FLEGT-VPA in Brussels, Belgium, on October 19.

Van noted the main markets of Vietnamese wood products are the EU, the US, Japan, the Republic of Korea, China and Australia. All of them bar China have compulsory regulations on timber legality.

When Vietnam negotiated the deal, the US and many other countries had high hopes it would commit to building a legally-controlled wood market, she added.

To help the FLEGT-VPA prove effective immediately after it takes effect, Vietnam has created mechanisms and policies in conformity with the pact, according to Deputy Director General of the Vietnam Administration of Forestry Pham Van Dien.

Notably, the Forestry Law, which will come into effect on January 1, 2019, includes commitments under the FLEGT-VPA, he said, adding the country is completing more policies and documents institutionalising the deal.

Trieu Dang Khoa, deputy head of the forest management division in Tuyen Quang province, said locals and businesses have encountered difficulties in exporting wood without certificates. Therefore, the province has developed wood material zones meeting Forest Stewardship Council (FSC) standards.

Tuyen Quang has 19,700ha of forests with FSC certificates so far. It is striving to have another 4,500 – 5,000ha certified in 2019.

He said by planting forests with FSC certificates, local residents’ awareness has improved and they have better complied with regulations on forest production. While workers’ rights have been ensured, forest management has also been promoted.

Notably, wood products hailing from certified forests up to 30 percent more value than those from forests without FSC certificates. This encourages residents in forest planting and protection, Khoa noted.

Meanwhile, central Quang Tri province ranks first in the country with more than 25,000ha of certified forests.

Ha Sy Dong, member of the National Assembly’s Committee for Financial and Budgetary Affairs and deputy head of the NA deputies’ delegation of Quang Tri, said, “the most effective way to protect forests is to help locals realise they can benefit from forests.”

Another measure to promote proper production practices is encouraging consumers to use wood products with legal origins, said Vice Chairman of the Ho Chi Minh City Handicraft and Wood Industry Association Huynh Van Hanh.

The country earned more than 7.61 billion USD from exports of forestry products between January and October, 84 percent of the yearly target. Timber and wood products contributed 7.23 billion USD to the revenue. 

Vietnam is one of the world’s leading wood processing and exporting countries with an export turnover of 8 billion USD in 2017. The figure is expected to hit 9 billion USD this year.

The nation sets a target of 20 billion USD in wood exports by 2025.

Vietnam needs centre to boost innovation: experts

Vietnam needs to build up the National Innovation Centre to create a technological start-up ecosystem and upgrade the national innovation system, said experts.

The centre plays an important role in bringing new technologies to businesses and individuals, Nguyen Dinh Cung, head of the Central Institute for Economic Management (CIEM), said at a workshop on establishing the National Innovation Centre (NIC) held by the CIEM in Hanoi on October 31. 

Vietnam’s innovation centres can help convert the country into an innovation-driven society based on Industry 4.0 technology, he stressed, adding the NIC will have an advanced development model to create an international-level ecosystem for tech start ups.

Dang Quang Vinh, deputy head director the CIEM’s Business Environment and Competitive Ability Department, said innovation centres in Vietnam have remained outside the world ranking. In the past 10 years, centres supporting start-up enterprises did not succeed in creating a billion-dollar company.

The NIC will be the hub for the innovation ecosystem in Vietnam, Vinh said. In its first stage, the NIC will focus on hardware and software in fields such as smart cities, digital industry (games, advertising, movies and music) and network security.

The CIEM proposed the NIC as a social enterprise with 100 per cent private investment under the provisions of the 2014 Enterprise Law.

The NIC will enjoy business incentives including a 20-year exemption of land use fees, preferential credit and permission for domestic and foreign enterprises in the same field to rent space.

The centre will be located on a 23ha area of Hoa Lac Hi-tech Park. The investment capital is expected to reach 1.9 trillion VND (82 million USD), 1.7 trillion VND of which will be used to build its facilities. Construction will begin in 2019 and should be finished within three years. The centre can begin operating during the second year of construction.

Le Hai Mo, deputy head of the Institute of Financial Strategy and Policy under the Ministry of Finance, said the NIC should be developed under an open model rather than an administrative model.

Cung said the centre must have a high income to attract talented people who have options in other countries.

The centre will contribute to the improvement of the country’s innovation system and to the implementation of the National Strategy for the Fourth Industrial Revolution. The NIC will have pilot programmes for improving cooperation between the State and businesses for social purposes and the implementation of innovative policies to adapt governance to the Fourth Industrial Revolution.

Fourth Industrial Revolution to impact employment: forum

The fourth Industrial Revolution will impact all socio-economic aspects of Vietnam, especially labour and employment, heard a forum in Hanoi on October 31. 

Dr. Tran Hong Quang, Director of the National Centre for Socio-economic Information and Forecast (NCIF), said the revolution will reduce the size of the labour force and improve efficiency and productivity. 

However, it would lead to increased unemployment and income inequality, the official pointed out. 

Echoing Quang’s views, Associate Professor and Dr. Vu Quang Tho from the Worker and Trade Union Institute under the Vietnam General Confederation of Labour said if labourers fail to adapt, they may lose their jobs. 

Dr. Nguyen Van Thuat from the NCIF stressed the need for Vietnam to prepare measures to deal with the sharp decrease in the demand for unskilled labourers in several sectors. 

Although Vietnam is stepping up international integration efforts, up to 77 percent of its workforce (43 million labourers) are not trained, he said, describing this as a major problem in national socio-economic development. 

The delegates also pointed out the likelihood of many labourers being replaced by robots and smart equipment. 

Associate Professor and Dr. Bui Van Huyen from the Economic Institute under the Ho Chi Minh National Academy of Politics said the industrial revolution has generated opportunities and challenges for the country’s social welfare sector. 

He suggested utilising the opportunities to overcome the challenges, noting Vietnam needs to change its education policies and apply new technologies in labour management. 

Tho added Vietnam should continue to develop the labour supported by completed law, institutional tools and policy, while working to improve workforce quality and structure, as well as the income of labourers.

Export turnover goes up by 14.2 percent in ten months

Vietnam’s export turnover hit 200.27 billion USD in the first 10 months of 2018, up 14.2 percent against the same period last year, according to the General Statistics Office (GSO). 

Export revenue of the domestic economic sector rose 16.8 percent, reaching 56.82 billion USD, while that of the foreign direct investment (FDI) sector expanded 13.2 percent to 143.45 billion USD, up 13.2 percent, accounting for 71.6 percent of total turnover. 

Many key exports gained high growth, with mobile phones and spare parts reaching 40.7 billion USD, garments and textiles 25.2 billion USD and computer and electronic spare parts 24.3 billion USD, year-on-year rises of 10.6 percent, 17.1 percent and 15.2 percent, respectively. 

Growth was also seen in the earnings from farming products, including fruits and vegetables (up 14.4 percent to 3.3 billion USD), coffee (1.1 percent to 3 billion USD) and rice (up 16.1 percent to 2.6 billion USD).

However, crude oil exports in the period fell in both value and volume compared to the same period last year, reaching only 1.8 billion USD, down 24.8 percent in value and 45.4 percent in volume. 

The US remained the largest importer of Vietnamese good in the period. Vietnam’s exports to this market totaled 39 billion USD, a 12.8 percent year-on-year rise. 

It was followed by the EU, China, ASEAN, Japan and the Republic of Korea, with respective revenues of 34.9 billion USD, 32.1 billion USD, 20.6 billion USD, 15.3 billion USD and 15 billion USD. 

Meanwhile, the country’s import value rose 11.8 percent year-on-year to 193.84 billion USD. Of which, the domestic sector accounted for 77.5 billion USD, up 12 percent while the FDI sector spent 116.34 billion USD, up 11.7 percent.

Vietnam’s trade surplus in the first 10 months stood at 6.4 billion USD. 

The GSO warned that the trade war between the US and China could affect the country’s import and export activities, so measures are needed to minimise these impacts.

Export turnover goes up by 14.2 percent in ten months

Vietnam’s export turnover hit 200.27 billion USD in the first 10 months of 2018, up 14.2 percent against the same period last year, according to the General Statistics Office (GSO). 

Export revenue of the domestic economic sector rose 16.8 percent, reaching 56.82 billion USD, while that of the foreign direct investment (FDI) sector expanded 13.2 percent to 143.45 billion USD, up 13.2 percent, accounting for 71.6 percent of total turnover. 

Many key exports gained high growth, with mobile phones and spare parts reaching 40.7 billion USD, garments and textiles 25.2 billion USD and computer and electronic spare parts 24.3 billion USD, year-on-year rises of 10.6 percent, 17.1 percent and 15.2 percent, respectively. 

Growth was also seen in the earnings from farming products, including fruits and vegetables (up 14.4 percent to 3.3 billion USD), coffee (1.1 percent to 3 billion USD) and rice (up 16.1 percent to 2.6 billion USD).

However, crude oil exports in the period fell in both value and volume compared to the same period last year, reaching only 1.8 billion USD, down 24.8 percent in value and 45.4 percent in volume. 

The US remained the largest importer of Vietnamese good in the period. Vietnam’s exports to this market totaled 39 billion USD, a 12.8 percent year-on-year rise. 

It was followed by the EU, China, ASEAN, Japan and the Republic of Korea, with respective revenues of 34.9 billion USD, 32.1 billion USD, 20.6 billion USD, 15.3 billion USD and 15 billion USD. 

Meanwhile, the country’s import value rose 11.8 percent year-on-year to 193.84 billion USD. Of which, the domestic sector accounted for 77.5 billion USD, up 12 percent while the FDI sector spent 116.34 billion USD, up 11.7 percent.

Vietnam’s trade surplus in the first 10 months stood at 6.4 billion USD. 

The GSO warned that the trade war between the US and China could affect the country’s import and export activities, so measures are needed to minimise these impacts.

More than 109,600 new firms established in ten months

Up to 109,611 new enterprises were formed in the first 10 months of this year, with total capital of more than 1.11 quadrillion VND (48.1 billion USD).

The figures marked a year-on-year increase of 4.3 percent in the number of businesses and 9.2 percent in capital, according to the General Statistics Office under the Ministry of Planning and Investment.

In October alone, 13,000 firms were founded with accumulated capital of 152.5 trillion VND (6.5 billion USD).

During the January-October period, the average capital for an enterprise reached 10.2 billion VND (438,600 USD), up 4.7 percent over the same period last year.

In addition, 27,935 firms resumed operations, up 22.7 percent year-on-year, raising the total number of new and resumed enterprises to 137,500.

Tien Giang: 400 tonnes of star apples to set off for US

Farmers in the Mekong Delta province of Tien Giang are preparing the shipment of 400 tonnes of local well-known Lo Ren star apples to the US this year. 

This is the second year Tien Giang has shipped fresh star apples to the US. Last year the province exported nearly 100 tonnes of the fruits to the market. 

To fulfill the order, the star apple fruits have been collected from more than 270 farms across the districts of Cai Be, Cai Lay and Chau Thanh. These farms grow over 100 hectares of star apples which have been verified and labeled with code stamps to trace the origin of the fruit.

The farms have used advanced techniques for pesticide management as required by the US Animal and Plant Health Inspection Service (APHIS) and made records of the star apple farming.

The first batch of Vietnamese star apples arrived in the US in December last year, making Vietnam the first and only country licensed to sell fresh star apples to the demanding market, following years of negotiations, according to the Ministry of Agriculture and Rural Development.

Star apple is among six Vietnamese fruits allowed into the American market, together with litchi, longan, rambutan, dragon fruit, and mango.

Last year, Vietnam was estimated to have about 5,000 hectares of star apples, mainly in Tien Giang (3,100ha) and Can Tho city (1,200ha).

Tien Giang boats the country’s largest orchard area with some 73,000 hectares, which yield around 1.4 million tonnes of fruits a year. If the Mekong Delta is dubbed Vietnam’s fruit kingdom, the province should be called “the kingdom of the fruit kingdom” since it has many fruit brands such as Lo Ren Vinh Kim star apple, Hoa Loc mango and Tan Phuoc pineapple. 

Many residential blocks falsely advertised as luxury ones to cheat buyers: HoREA

The rampant use of designations for apartment buildings such as “high-end,” “luxurious” and “premier” in the property market is an emerging trick to lure customers, according to the HCMC Real Estate Association (HoREA).

In a note sent to relevant agencies on October 22, HoREA Chairman Le Hoang Chau said it was essential to tighten control over the rapidly emerging trend of using the words “luxury,” “high-end,” “premier” and “royal” to describe apartments and houses. In fact, few of the real estate projects meet high-end standards in the market.

Many property projects, including villas, buildings and apartments, have been advertised as high-end homes by their owners, but they have yet to be officially assessed and recognized by the Construction Department or any other assessment unit. In falsifying information, these owners have violated the regulations of Clause 13 in Article 6 of House Law 2014.

In terms of State management, even though the Ministry of Construction has two circulars on the classification of apartments which have been in force over the past 10 years, neither project investors nor apartment management boards have proposed classifying their apartments to date.

As such, it is imperative to reconsider the practicability of legal documents as they have failed to meet the needs of the industry and require transparency, honesty and fair competition in the real estate market.

The note also quoted HoREA as saying that the classification would become transparent if the projects were completed, which would help buyers avoid buying the wrong kind of apartment. If an apartment is scheduled to be built in the future, buyers can easily end up with an apartment that does not match the advertisement.

Therefore, it is necessary to adjust and supplement Circular 31/2016, regulating that apartments can only be recognized as high-end after the completion of construction and examination by the competent agency to ensure transparency and guarantee buyers’ interests, according to HoREA.

Regarding apartments that will be built in the future, owners will only be allowed to advertise and market these projects to mobilize capital.

Japanese firm joins US$35m project in Hanoi

Japan-based firm Sanei Architecture Planning Co., Ltd, which is active in the real estate sector, has taken part in a joint venture with Leadvisors Capital Management to develop the Leadvisors Tower office block on Pham Van Dong Street, Hanoi City, at a total cost of US$35 million.

LeadvisorSanei Hospitality Holdings, the joint venture between the two firms, is expected to receive 51% of the total investment capital from the Vietnamese firm, while the remaining capital will be covered by the Japanese side. The office-for-lease building project is slated for completion in the third quarter of 2019.

Speaking at a signing ceremony aimed at authorizing Savills Vietnam to act as a consultant to lease offices at Leadvisors Tower on October 23, Huynh Minh Viet, chief executive officer of LeadvisorSanei Hospitality Holdings, said that even though numerous Japanese firms have invested in Vietnam, no office-for-lease buildings have been designed or developed based on Japanese standards. This was the reason for the construction of Leadvisors Tower, Viet added.

Viet said the cooperation with the Japanese firm was aimed at establishing a Japanese-style office building in the Hanoi market.

When complete, Leadvisors Tower will meet Japanese Grade A office building standards and cover some 28,000 square meters, with 25 floors and three basement levels.

Talking about the office market, Matthew Powell, Hanoi branch director for Savills Vietnam, said demand for offices for lease in Hanoi City was on the rise as the city was attracting strong foreign investment and seeing the rapid development of startups. Therefore, customers have faced a shortage of offices, forcing them to lease old offices for their businesses.

As such, the leasing of offices in Hanoi City is on an upward trend, particularly the high-end ones, Powell added.

Hanoi City currently has 1.7 million square meters of office space, with mid-end offices accounting for the majority and high-end offices making up a mere 26%, according to Bui Trung Kien, associate director of Commercial Leasing Savills Hanoi.

“The current average rent for a high-end office in the east of the city is US$25 per spare meter,” Kien said.

Besides this, Lars Wittig, Regus country manager for Vietnam, Cambodia and the Philippines, said the company had had difficulty finding new spaces in premium office buildings where it could develop business centers. Regus plans to open one more center in Hanoi, which is scheduled to cover one-third of the combined area of its existing nine centers in the city.

It is said that the number of centers owned by Regus, a global workplace provider, has recently risen from 60% to 89% in Hanoi City.

Ben Tre opens fruit, veg supply depot

Wholesaler Mega Market Vietnam (MM) on October 31 launched its first fruit depot in Ben Tre province to supply quality fruits and vegetables for both export and local markets.

Phidsanu Pongwatana, managing director of MM Mega Market Vietnam, said the fruit platform in Ben Tre would supply safe and quality fruit products for MM’s 19 stores across the country.

“This depot will also be an export base for Vietnamese fruit to Thailand, China and other Southeast Asian countries,” he added.

Along with fruits as the core supply, the Ben Tre platform will also serve as a stockpile for vegetables and fruits in the Mekong Delta and surrounding provinces. 

“Situated at a prime location, the depot will help MM ensure a smooth flow of vegetable and fruit from Mekong Delta source areas to MM stores as fast and as cost-effectively as possible, while keeping products fresh all the way,” he said. 

“MM customers can now trace the origin of fresh food products even more easily,” Phidsanu added.

Ben Tre base is a joint operation between MM Mega Market Vietnam and Huong Phu Sa Vegetables and Foods JSC.

Under the partnership, Huong Phu Sa Vegetables and Foods will work with MM’s quality control and purchasing agents, and cooperate with farmers, cooperatives and suppliers to select qualified food products to go through the depot for pre-processing and packaging. 

More than 60 different types of fruits, including mainstream categories such as grapefruit, Thai coconut, pineapple, melon, lemon, King orange, and mango, among others, will be selected from concentrated source areas in Mekong Delta provinces.

In the beginning, the Ben Tre Fruit Platform is projected to run about 15 tonnes throughput per day. In the second phase next year, the depot’s capacity will increase to about 50 tonnes per day. 

Following the model of the Da Lat Vegetable Platform, the Ben Tre depot will enlist about 100 farming households, mostly in Mekong Delta provinces, including Ben Tre, Tien Giang, Can Tho, Long An, Tra Vinh, Vinh Long and Dong Thap.

MM agricultural engineers will work firsthand with local farmers and cooperatives, from seed selection to production planning, harvesting, packaging and hauling to the Ben Tre platform, without going through middlemen. 

Farming households joining the loop will need to maintain a farm logbook and record in detail how they use pesticides. They will also be asked to keep a journal of harvesting work, and conduct periodic quality testing in accordance with MM Mega Market Vietnam’s standards.

MM launched a pork platform last year, a Can Tho fish platform in 2011, and a Da Lat vegetable platform in 2008.

MM Mega Market Vietnam (formerly Metro Cash & Carry Vietnam) started its wholesale operations locally in 2002 and now has 19 stores in the country, with more than 3,300 employees. 

Dairy giant reports higher revenue, lower profit in Q3

The Vietnam Dairy Products Joint Stock Company (Vinamilk) has reported its combined revenue rose 3.3 percent year-on-year in the third quarter of 2018 to 13.73 trillion VND (around 586.8 million USD).

However, Vinamilk’s pre-tax profit was down 5.9 percent to more than 3 trillion VND (128.16 million USD) as costs increased by 14 percent year-on-year to 3.4 trillion VND (145.25 million USD).

In the first nine months, Vinamilk recorded more than 39.55 trillion VND (1.69 billion USD) in revenue, up 2 percent compared to the same period last year.

The main revenue source for the company was the domestic market, where sales reached 33.9 trillion VND. Sale revenue from overseas markets was 5.7 trillion VND, about the same as last year’s figure.

However, revenue growth could not offset rising production costs, so combined profit fell slightly to 18.44 trillion VND (788.16 million USD) in the first nine months of 2018 from last year’s 18.63 trillion VND (795.9 million USD).

Costs in the first three quarters rose 6.8 percent to 8.9 trillion VND (380.3 million USD), resulting in nine-month pre-tax profit of 9.37 trillion VND (400.3 million USD), down by 800 billion VND from last year.

Poor quarterly earnings have pulled the share price of Vinamilk, listed on the Ho Chi Minh Stock Exchange as VNM, down since early this month.

Shares have lost 15.2 percent in value since October 4 to end October 31 at 116,100 VND (5.16 USD).

Vietjet’s earnings up 105 percent in third quarter

The Vietjet Aviation Joint Stock Company (HOSE code: VJC) recorded a yearly revenue increase of 105 percent to more than 12.71 trillion VND (544.28 million USD) in the third quarter of 2018.

The strong revenue growth was fuelled by rising air transport, ancillaries, sales and leaseback revenue, according to Vietjet’s business results released on October 30.

Vietjet’s air transport revenue for the quarter reached 8.9 trillion VND, an increase of 45 percent year-on-year, and the load factor stood at approximately 89 percent thanks to the expansion of a new, modern fleet along with the opening of new international routes and flexible seat capacity management in the low season.

Air transport profit in the third quarter topped over 1 trillion VND, 11 percent higher than the same period last year. Ancillary products and services also grew dramatically with 2.8 trillion VND in revenue, up 55 percent year on year.

The airline’s pre-tax profit stood at 1.71 trillion VND from July to September, up 60 percent year-on-year.

Over the first nine months, Vietjet continued to have the most flights and best growth with 89,690 take-offs, an increase of approximately 22 percent.

The airline transported approximately 16.9 million passengers to retain its leading position in the domestic air transport market. International revenue ratio reached over 50 percent of total operational revenue, exceeding its plan.

Vietjet’s revenue in the nine-month period reached 33.9 trillion VND while its pre-tax profit hit 3.68 trillion VND, up 30 percent over the same period last year.

According to Vietjet, its transport revenue stood at 25.4 trillion VND in the reviewed period, a yearly hike of 50 percent, and the air transport profit after tax was 2.28 trillion VND, making up 76 percent of its 2018 target.

Besides these positive business results, the airline’s on-time performance stood at 83.5 percent while its technical reliability was 99.66 percent with the safety performance of flight, ground operation indicators amongst the top in the region, Vietjet said in a statement.

The carrier has also been awarded the world’s highest safety ranking with 7 stars by AirlineRatings.com, the world’s leading airline safety and product rating agency.