BUSINESS NEWS 1/7

Vinalines moves shareholders’ meeting to end of July

BUSINESS NEWS 1/7


The Vietnam National Shipping Lines (Vinalines) will delay its annual shareholders’ meeting until July 29, one month later than expected.

This delay is due to the amending of the Ministry of Finance’s Circular 34/2019/TT-BTC guiding the initial sale of shares and managing the proceeds from the equitisation of enterprises, which will officially take effect on July 29, 2019.

The corporation must wait until the circular takes effect to meet the provisions of the Government’s Enterprise Law and Decree No. 126/2017/ND-CP on transforming State enterprises and one member limited companies into joint stock companies.

This is the third time Vinalines has had to change the time of its first shareholders' meeting to officially switch to a joint stock company model. The meeting was originally set for the first quarter of the year, and then moved to June 24.

To prepare for the equitisation process, Vinalines has organised two share offerings.The initial public offering session attracted 42 investors who registered to buy 5,439,800 shares (accounting for more than 1.1 per cent of the nearly 490 million shares offered for auction). At the second negotiation session, the number of shares offered by Vinalines is more than 483.3 million.

Role of business community in rapid and sustainable development

At the mid-term VBF 2019 the largest foreign business organisations from the EU, US, Korea, and Japan submitted recommendations to enhance private sector participation in Vietnam's drive for sustainable growth.

The mid-term Vietnam Business Forum (VBF) 2019 today (June 26) was held by the Ministry of Planning and Investment in collaboration with the World Bank, International Finance Corporation (IFC), and VBF Consortium, with the theme of “Role of business community in rapid and sustainable development".

Vietnam is an attractive destination for domestic and foreign investors, especially as global trade tensions keep on. Vietnam could seize the opportunities from the transformation of manufacturing facilities. Thereby, improving the investment and business climate is one of the most important factors to take advantage of all opportunities coming the country's way.

Most comments at the mid-term VBF 2019 highlighted these points. The European Chamber of Commerce (EuroCham) hoped to remove all unclear and unnecessary business conditions in the next quarter, in accordance with Resolution No.02/NQ-CP, while the American Chamber of Commerce in Vietnam (AmCham) wishes to see higher standards of business, as well as ensure equal opportunities and fairness for all.

The Korea Chamber of Business in Vietnam (KoCham) expressed concern about the delays in granting investment certificates for some projects in Ho Chi Minh City and the progress of infrastructure improvements. Meanwhile, the Japanese Chamber of Commerce and Industry in Vietnam (JCCI) said that the change in laws or regulations will disturb stable business operations, hence it will increase back office cost, leading to difficulties in enterprise establishment, and expressed the need for more predictability in business.

For the past two decades, Vietnam’s competitive position was based on low labour costs and attractive demographics that offset the many regulatory burdens investors faced. Recently, labour costs have outpaced productivity gains which hurts the country’s competitive position.

In the time coming, Vietnam wants not only to increase productivity and the quality of investment capital, as well as take advantage of opportunities from free trade agreements, but also to become a hub attracting resources into innovation and the science-technology sector.

“We highlight the importance of the improvement of the business climate for the rapid and sustainable development of the private sector, and expectations for investment by private enterprises and how their role is growing in Vietnam. The improvement of the business climate will encourage private investment, which will contribute to the further development of Vietnam,” Nobufumi Miura, chairman of JCCI, commented at the mid-term VBF 2019.

The business community said that Vietnam could be more attractive if it ensured the fairness of legal provisions and facilitated expansion to international markets. Amanda Rasmussen, chairwoman of Amcham, emphasised, “Creating an environment that encourages innovation is vital for Vietnam’s future.” Science and technology are areas of great opportunity that require forwarding-thinking policy approaches, but in fact, there are many troubles to face.

The Investment and Trade Working Group of VBF raised recommendations about fintech and peer-to-peer (P2P) lending. While fintech is growing rapidly in Southeast Asia, the lack of regulatory guidance has made it more difficult for businesses to navigate this industry in Vietnam. No specific business line for P2P lending services exists and businesses are not clear on which business line they should register P2P lending services under in Vietnam.

“We have seen businesses register other business lines to provide P2P lending services, and risk being non-compliant with their business license by operating a service that is not covered by their business license,” the working group stated.

They also recommended that the government reconsider restricting foreign ownership in fintech companies, as it may handicap the growth of fintech in Vietnam, as well as the investment-attracted capability.

VBF associate members also commented about technology transfer as one of the most important factors for a good business environment in Vietnam. In reality, the 2017 Law on Technology and Decree No.76/2018 have a heavy-handed approach to technology transfer.

Specifically, the overly broad registration requirements hinder investments by delaying technology transfer processes and hampering the execution of technology transfer agreements. Some investors will be sufficiently deterred by the confidentiality risks posed by registration, to the point that they may forego their entire investment in Vietnam.

In fact, investors are expecting new trends and new platforms of digital economy, aimed to significantly reduce costs, supply products and services to much more customers, as well as easily approach new and sizeable markets.

“We advocate for the critical improvements necessary to allow the flow of technology and science to continue Vietnam’s opportunities for sustainable growth,” Rasmussen commented.

Mobile World pockets huge income from selling watches

The strategy of “selling goods that they never sold before” partly helped technology retailer Mobile World to overcome the saturation of the smartphone market.

18 Mobile World stores that have begun selling watches and fruits in addition to the company's usual goods have been pocketing VND600-1,000 million ($26,086-43,478) of revenue on average for nearly two months. These stores sell an average of 500 watches per month.

With this quite satisfying business performance, leaders of Mobile World plan to add these products to more stores in the future.

Mobile World's net revenue and after-tax profit in this year’s first five months reached VND42.8 trillion ($1.86 billion) and VND1.79 trillion ($77.83 million), respectively. Cooling appliances are still its key goods, generating sales of VND2.3 trillion ($100 million), up 40 per cent on-year. In addition, online sales also occupied 16 per cent of the corporation's total revenue.

In May, Mobile World opened 47 stores across its multi-brand system, including thegioididong (specialised in mobile devices), Dien May Xanh (electronic goods), and Bach Hoa Xanh (food). The expansion raised the total number of Mobile World’s stores to 2,371.

In addition, during the period, the Bach Hoa Xanh chain also reported rosy performance. Accordingly, stores in the chain earned a revenuean average of VND1.4 billion ($60,870) per month, up 75 per cent on-year. The store chain also set the target of increasing the number of stores in the next six months.

Explaining the reason behind the shift towards watches and fruit, many experts stated that local demand for new gadgets is not as high as before, so retailers have been looking for new growth directions.

Germany-based market research company GfK forecasted that the local mobile market in 2019 will only grow by 1 per cent – the lowest ever growth rate.

Tai from MWG himself admitted that the time when people are lining up to buy new smartphones is over. “I use an older smartphone and don’t feel like upgrading because it’s still good enough to use.”

His example partly shows a new shopping attitude among Vietnamese consumers – purchasing new devices for their needs and not for new experiences and features.

Since early 2018, Mobile World has been limiting the expansion of thegioididong stores, with no new stores opened last year and 40 stores closed to focus on developing electronics chain Dien May Xanh. This is contrary to the corporation's speed of opening three stores every two days during 2015-2016.

Errors in equitisation of Vietnam Medical Equipment Corporation

The Government Inspectorate of Vietnam has just announced the conclusions of its inspection of the equitisation process at Vietnam Medical Equipment Corp. (Vinamed); the state divestment at Mediplast Medical Plastic JSC (Mediplast) and Danameco Health JSC (Danameco); and the merger of Mediplast into Vinamed.

The Government Inspectorate concluded that in 2007-2010, the Ministry of Health (MoH) did not request advice from the prime minister about the difficulties to complete the equitisation of Vinamed, which after the transition was not transformed into a joint stock company.

After being transformed into Vinamed, the enterprise did not research the production of medical equipment and neither did it increase the value of the state's interest in the company.

For the equitisation process of Vinamed in the 2014-2016 period, Decision No.4208/QD-BYT dated October 15, 2014 of the Minister of Health was not consistent with the provisions of Decree No.59/2011/ND-CP dated July 18, 2011 of the government. The MoH did not issue a plan or a roadmap to implement the equitisation in accordance with regulations.

Vinamed and Dong A Securities Co., Ltd. did not notify the authorities in time about completing the business valuation.

The Ministry of Health (MoH) issued Decision No.3854/QD-BYT on the value of equitised enterprises slower than prescribed; the implementation of the approved land use plan was slow and the land use was not in accordance with the plan.

The corporation until July 12, 2016 also had overdue bad debts.

The Government Inspectorate also pointed out that after the sale of the shares the company delayed returning the state's capital.

In addition, the equitisation steering committee did not report to the MoH the added value of Mediplast shares from VND25,200 ($1.1) to VND 29,484 ($1.3) per share and did not recalculate the value of state capital at the time it officially transformed into a joint stock company.

Along with that, the merger of Mediplast into Vinamed did not comply with the PM's directions. After one year of officially operating under the JSC model, Vinamed should have completed the divestment before merging with Mediplast, but the company reversed this order.

Prior to the above issues, the Government Inspectorate of Vietnam proposed the PM to direct relevant units to re-calculate the value of shares, the number of shares, and the percentage of shares held by the state at Vinamed to transfer to the State Capital Investment Corporation (SCIC).

The MoH redefined the value of state capital when the firm was transferred to the JSC model.

At the same time, the MoH clarified its responsibilities and determined penalties and solutions for these shortcomings.

Vinamed must immediately pay the interest and late payment fee due to delaying payments to the state. The state will also cancel and nullify the two valuation certificates and documents (one for the divestment and one for the merger).

The Hanoi People's Committee monitors and urges the handling of existing problems in the management and use of houses and land at No.1 Lane 135, Nui Truc, Kim Ma, Ba Dinh, Hanoi and No.89 Luong Dinh Cua, Dong Da, Hanoi.

The Hanoi People's Committee will also prepare documents to deal with land and house recovery in accordance with regulations if Vinamed is found to have violated regulations on land management and use in the two above facilities.

EVFTA: Textiles & footwear exports to hit $15.5bn by 2035

Textiles and footwear stand to benefit the most from the EU-Vietnam Free Trade Agreement (EVFTA), with export revenue reaching $15.5 billion by 2035, according to a new report from the Bao Viet Securities Company (BVSC).

BVSC released the “Opportunities for key Vietnamese sectors when the EU-Vietnam Free Trade Agreement is signed and approved” report on June 26, which it tips will add 0.48 per cent to GDP growth.

Following the textile and footwear sectors, exports of food and business services are expected to increase by $902.1 million and $616.9 million, respectively, by 2035.

Due to strong competition from imports of electronics and equipment from the EU into Vietnam, the export of such goods and other types of machinery and components are expected to fall slightly, by $222.7 million and $36.3 million.

Though expected to benefit from the EVFTA, Vietnam’s textile and garment industry will have to make changes to meet origin conditions and take advantage of preferential tariffs in the agreement.

In the short term, industries such as textiles and footwear will face the same tariff levels according to the roadmap. Five years after the agreement comes into force, however, Vietnamese textiles and garments will be competitive in the European market as tariffs fall.

Vietnam’s dairy industry is expected to face competition from EU-made dairy products and their advantages in quality and food safety. But because the main product segment is somewhat skewed, the competitive pressure for Vietnam’s dairy businesses will not be overly harsh.

Fruit and vegetables and footwear are currently strengths for Vietnam, and if technical standards (especially on fruit and vegetables) can be overcome, the EVFTA will create a boost in growth for many businesses pursuing modern high-tech agriculture.

In addition to sectors that benefit directly from the roadmap of tariff reductions in the agreement, other industries will also benefit indirectly, such as logistics and enterprises in the fields of infrastructure construction and industrial park real estate.

BVSC wrote that to take advantage of trade agreements, Vietnam has to make certain that its legal framework and transport and logistics infrastructure can adapt to greater development conditions.

SSC & Institute of Directors sign MoU

The State Securities Commission (SSC) and the Vietnam Institute of Directors (VIOD) signed a memorandum of understanding (MoU) on June 24 to mark cooperation between the two on supporting the professional activities of boards of directors (BODs).

“This event marks an important milestone in the cooperative relationship between VIOD and the SSC to enhance good corporate governance practices,” said Ms. Ha Thu Thanh, Chairwoman of VIOD.

“As an independent organization with a mission of promoting corporate governance standards and best practices in Vietnam’s corporate sector, VIOD expects this cooperation to contribute to promoting effective corporate governance in the market to attract investors and thereby enhance the profile of Vietnam’s stock market.”

On behalf of VIOD’s Board of Directors and Management, Ms. Thanh expressed her sincere thanks to all those whose dedication and effort supported and encouraged VIOD in its first year of its operation, especially SSC Chairman Tran Van Dung, SSC departments, and the country’s stock exchanges, together with the strong technical support from the International Finance Corporation (IFC) and Switzerland’s State Secretariat for Economic Affairs (SECO).

Addressing the MoU signing ceremony, Chairman Dung emphasized SSC’s ongoing support and partnership with VIOD in expanding programs and promoting good corporate governance practice.

He also extended his congratulations to the first members awarded Director Certification Program (DCP) certificates (DCP1 and DCP2) from VIOD. He expressed a hope that these members will become ambassadors and grow and spread VIOD’s programs in particular as well as stories of corporate governance in Vietnam in general.

The SSC and VIOD agreed on the mutual objectives of building and connecting a network of BODs in Vietnam through many events, in particular the Governance Awareness Programs and the Governance Excellent Programs provided by VIOD to the market.

The MoU focuses on many areas, including issuing guidelines on best practices in corporate governance that are applicable to public companies and listed companies and which can be in the form of handbooks, toolkits, and research articles; participating in suitable public forums to promote best corporate governance practices, which may include workshops, conferences, and other public events; organizing events of similar interest related to corporate governance; and representing Vietnam in the ASEAN Corporate Governance Scorecard (ACGS) Program, which is organized annually in the region.

After the signing, VIOD also held an awards ceremony to recognize the efforts of 50 members who successfully completed its first two DCP programs (DCP1 and DCP2) in Vietnam. In addition, under a special proposal from VIOD’s Board of Directors, the ceremony also presented DCP certificates to the first three honorary members of VIOD, to acknowledge the efforts these members have made in the development of good corporate governance in the market.

Tech Data & Cisco to support digital transformation

Tech Data has announced the expansion of Cisco’s distribution in Vietnam, with the former providing the latter’s complete solutions portfolio to partners in Vietnam.

“Tech Data will now bring Cisco’s world-leading solutions to our partners in Vietnam, enabling them to reach their full potential using both traditional and next-generation technologies,” said Ms. Tran Thi Bao Tran, Country General Manager, Vietnam, at Tech Data. “This agreement complements Tech Data’s engagements in the region with Cisco ecosystem alliance partners and recognizes our strategic sales approach, which combines our technical expertise with our deep understanding of the IT channel and local market to meet every aspect of our partners’ needs.”

“Digital transformation is accelerating rapidly across Vietnam,” said Ms. Luong Thi Le Thuy, General Director of Cisco Vietnam. “As businesses look to adopt technology to address key issues and open new opportunities, it is critical that they work with the right partners on their transformation journey. We are delighted that Tech Data will be offering the entire suite of Cisco’s technology and solutions to their partners in the country.”

Economic expansion in Vietnam is being matched by investment in technology across the ICT market, with hardware spending forecast to reach $5.9 billion by the end of this year, and this creates opportunities for businesses to take advantage of this investment and expected growth.

One of the ways Tech Data is engaging the market is through the provision of Cisco’s solutions for data centers, networks, cloud-based services, big data, the Internet of Things (IoT), mobility and wireless, security, and workforce cooperation.

A key part of Tech Data’s local go-to-market strategy is to enable both enterprise and run-rate selling, focusing on Cisco’s four key architectures: networking, security, collaboration, and data center. Tech Data’s ability to build bundled solutions, cross-sell with existing Cisco alliance products, drive engagement with C level enterprises, and provide complex integration services will ensure they can position partners to capture incremental revenue across these high-growth architectures.

Tech Data connects the world with the power of technology. Its end-to-end portfolio of products, services and solutions, highly-specialized skills, and expertise in next-generation technologies enable channel partners to bring to market the products and solutions the world needs to connect, grow and advance.

Asia's offshore wind market to become largest globally

Vietnam and other Asian countries are expected to be key growth markets in offshore wind power and turn Asia into the largest offshore region globally, according to the Global Offshore Wind Report released by the Global Wind Energy Council (GWEC) on June 26 in London.

This the first edition of the GWEC report, providing a comprehensive analysis of the prospects for the global offshore wind market, including forecast data, market-level analysis, and a review of efforts to lower costs.

Key growth markets include Vietnam, Taiwan (China), Japan, India, and South Korea. Total installed capacity for the region under the “business-as-usual” (BAU) scenario is 100 GW by 2030.

 

In the short term, Europe’s offshore market will remain flat with few projects reaching installation and Concerted Action Offshore during 2020, but the cost competitiveness of European offshore will remain a key driver of volume.

The Sector Deal in the UK provides a stable outlook, while volumes for Germany have still not increased despite government awareness. Total installed capacity for the region under the BAU scenario is expected to be 78 GW by 2030.

The first installation of large-scale projects in the US, expected between 2021 and 2023, will bring total installations to 2 GW by 2025, with potential for 10 GW of total installations towards 2030 with the increasing experience and maturing of the local supply chain.

The global offshore market has grown by an average of 21 per cent each year since 2013, reaching total installations of 23 GW. More than 4 GW of new capacity was installed each year in 2017 and 2018, making up 8 per cent of the total new installations during both years. For the first time, China was the largest offshore market in 2018 based on new installations, followed by the UK and Germany.

“We are within reach of a truly global offshore wind industry,” said Ms. Karin Ohlenforst, Director of Market Intelligence at GWEC. “Based on government targets, auction results, and pipeline data, we expect to see 190 GW of new capacity installed by 2030, but this does not represent the full potential of offshore wind. Many new countries are preparing to join the offshore wind revolution, while floating offshore wind represents a game-changing technological development that can add even more volume in the years to come.”

“The industry is continuing to make significant strides forward in cost-competitiveness, with an average levelized cost of energy (LCOE) of $50 per MWh being within reach,” said Mr. Alastair Dutton, Chair of the Global Offshore Wind Task Force at GWEC. “This achievement increases the attractiveness of offshore wind in mature markets, where a number of governments are discussing long-term climate targets that, if they are to be achieved, must seriously consider the contribution large-scale offshore wind can make. New offshore markets represent significant potential and if industry and governments can work together, as we have seen recently in the case of Taiwan (China), we can build the necessary policy frameworks at greater speed to ensure growth can be achieved sooner rather than later.”

GWEC Market Intelligence provides a market outlook in the report representing the BAU scenario, which does not incorporate further technical development or further opportunities for offshore wind, and an upside scenario that captures this additional potential.

The BAU scenario anticipates double-digit growth for the global offshore market based on current policies and expected auctions and tenders. This scenario makes annual installations of 15 to 20 GW after 2025 realistic based on growth in China and other Asian markets, amounting to 165 GW of newly-installed capacity globally between now and 2030. This would bring total installed capacity to nearly 190 GW.

The upside scenario captures additional potential such as the advancement of floating technology, increased cost competitiveness and therefore greater volume in mature markets, as well as the opening up of new offshore markets. Based on this scenario, a more positive outlook of over 200 GW newly-installed capacity between now and 2030 is possible, totaling approximately 210 GW installed capacity.

LuxYacht to distribute luxury Ferretti Group yachts

The LuxYacht Co., established from the ecosystem of VietYacht, has been officially appointed exclusive distributor in Vietnam of three super-luxury yachts - Ferretti Yachts, Pershing Yachts, and Riva Yachts - of the Ferretti Group. The cooperation once again affirms VietYacht’s position in the country’s yacht distribution market as it increasingly meets the needs of super-luxury yacht owners.

Founded in 1968, the Ferretti Group is an Italian multinational shipbuilding company headquartered in Forli and specializing in the design, construction, and sale of luxury motor yachts. Its products are sold under the brands Ferretti Yachts, Custom Line, Pershing, Itama, Riva, Mochi Craft, and CRN.

The Ferretti Group has manufacturing operations in Italy and the US, subsidiaries in the US (Ferretti Group North America) and Brazil (Ferretti Group Brazil, based in Sao Paulo with a another in Foz do Iguacu soon), and representative branches in Hong Kong and Shanghai (Ferretti Group Asia Pacific).

Ferretti is a cruising yacht line consisting of yachts with a length from 45 to 96 feet, Riva Yachts is an iconic classic yacht line consisting of convertible, sport, roof top, and superyacht products with lengths ranging from 27 to 160 feet, and Pershing Yachts boast outstanding performance and breathtaking speed, with a length from 54 to 170 feet.

According to Mr. Fabiomassimo Discoli, Director of Asia Pacific at the Ferretti Group, Vietnam is a market of potential in the field of yachting and this is a good opportunity for the Group to expand its business in the country. “Through LuxYacht, the Ferretti Group will be able to introduce to Vietnamese customers our proud yacht line, and we are honored to be with you in discovering the most beautiful water areas in the world,” he said. “We believe that LuxYacht will see the Ferretti yacht brand develop strongly in Vietnam.”

“Owning a yacht is becoming more and more familiar to Vietnamese people,” said Mr. Nguyen Duc Thuan, Chairman of the VietYacht Co. and General Director of the LuxYacht Co. “This new trend can help promote island and ocean tourism. Vietnamese customers will be able to enjoy beautiful yachts with optimal quality with Ferretti’s luxury yachts.”

Before Ferretti, VietYacht was also a distributor of yacht brands such as Jeanneau, Prestige, and Fountaine Pajot. Becoming an official distributor of Ferretti has perfected the company’s yacht ecosystem, from providing medium-range yachts to super-luxury yachts that can meet the diverse needs of customers.

LuxYacht is a company established from the ecosystem of VietYacht - a pioneer in the distribution of yachts from mid-range to luxurious yachts in Vietnam. LuxYacht is oriented to distribute super luxury yacht lines of Ferretti Yachts, Riva Yachts and Pershing Yachts of the Ferretti Group.

Founded in 2015, VietYacht is a pioneer in the field of distributing yachts and water sports equipment such as speedboats, steam boats, and jet skis in Vietnam that meet US and European standards.

More chances for stronger Vietnam-Canada investment ties

Vietnam and Canada will have more chances to enhance not only trade but also investment links under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), according to Honorary Chairman of the Canada Trade Link Bryon Wilfert.

Wilfert, who attended a seminar on opportunities to boost Vietnam-Canada trade and investment under CPTPP held in Ho Chi Minh City on June 28, said when joining the CPTPP, aside from trade, his country also wishes to strengthen partnerships with Vietnam in the fields of its strength like developing clean technology, clean energy, waste treatment and water treatment.

Vietnam also has infrastructure development projects that Canada wants to invest in such as building low-cost housing for young couples, he said.

He added there are also numerous opportunities for Vietnamese firms to boost investment in Canada through setting up companies, opening branches or purchasing companies in the North American nation.

However, Canadian experts recommended Vietnamese businesses have a good grasp of local law before making investment decisions since Canada is a big country with each of its localities having different conditions, regulations and incentives for investors.

To do so, investors can seek advice from consulting firms and economic lawyers, they noted.

The CPTPP, which took effect in Vietnam on January 14, gathers 11 member states, namely Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam that altogether make up 13.5 percent of global GDP.

At present, the CPTPP is the first and only free trade agreement involving Vietnam and Canada.

Bilateral trade reached 3.87 billion USD in 2018, a year-on-year rise of 10.6 percent. Vietnam exported 3.01 billion USD worth of goods to Canada, up 10.9 percent against the previous year, according to the Ministry of Industry and Trade.

The legality of timber products in government procurement in Vietnam

The Voluntary Partnership Agreement between the European Union and Vietnam on Forest Law Enforcement, Governance and Trade (VPA/FLEGT) took effect since June 1, 2019 with the core commitment of the agreement being "to ensure that all timber products are legally produced", which means all timber products in Vietnam, whether for exporting or domestic consumption, must be legally produced.

Under this agreement, the Vietnamese government, as a large customer, is responsible for ensuring the legality of timber products in the projects using the state's capital. This is a big challenge due to no solid, sufficient basis to determine whether the timber products in Vietnamese government procurement are legal.

The agreement is an important milestone in the process of implementing sustainable forest management as well as the sustainable development of the wood processing industry in Vietnam.

From the perspective of implementing the VPA-FLEGT commitment, ensuring the legality of imported and exported timber is relatively feasible as all wood and products imported or exported must pass through border control. Thus, competent authorities can check the legality of timber and wood products through mandatory control mechanisms.

Meanwhile, with domestic wood consumption, it is much more difficult to ensure the implementation of commitments, because there are no mechanisms that allow the control of the legality of wood and wood products before they reach local buyers. Therefore, one of the solutions is considered to be control by the buyers themselves. If the buyer requires legal timber, the timber business owner will have to ensure the legality of the products.

Nguyen Thi Thu Trang, director of the WTO and Integration Centre of the Vietnam Chamber of Commerce and Industry, stated that it is necessary to add a compulsory requirement to bidding files on proving the legality of goods and services provided.

On the other side, the person who prepared the bidding documents needs instructions, training, and attention on legal timber requirements in the procurement packages for the tenderers.

In addition, on the side of procurement, it is necessary to have proper communications campaigns to increase awareness of the requirements of timber materials and their legality.

According to the report from the research team, there are two groups of wood products that are bought the most: wood products for schools (boards, desks, chairs, cabinets, shelves, bookshelves, toys, and beds for boarding students) and office furniture (cabinets, tables, chairs for the office, hall, meeting room, engine room, curtains).

In the domestic timber market, the state is a special "buyer" in many respects. First, this is a large customer group, occupying a significant market share, with thousands of organs using state capital to purchase wood products. Second, this group of customers has a consistent procurement method under strictly controlled public procurement.

A survey of 100 bidding documents for the procurement of timber products by state-funded units in 2016-2018 shows that in fact, the bidders are very interested in the type of wood used and mainly require natural wood.

However, bidders rarely have any specific requirements about the legality of timber in addition to the mandatory sample provisions under the Law on Bidding.

60 leaders join Talentnet Business Innovation Showcase 2019

Talentnet Business Innovation Showcase 2019 attracted over 60 top-notch business and HR leaders to exchange viewpoints about human capital strategies in the digital age.

Talentnet Business Innovation Showcase (TBIS) is a regional business excursion exclusively and uniquely designed for Vietnamese leaders and HR practitioners, organised by Talentnet Corporation with the co-operation of the Singapore Human Resources Institute.

Taking place from June 19 to 21 in Singapore, the trip brought together more than 60 leaders and professionals from over 20 homegrown companies, providing a wealth of valuable lessons, enlightened knowledge, and best practices in successful organisational culture and human capital management strategies.

Gex Ventures, Google, Harman, Heraeus, Oracle, and Unilever Singapore were amongst the host companies accompanying Talentnet Business Innovation Showcase 2019. These companies have continuously been recognised with prestigious international awards for their innovative approach to human resources management, laying a solid foundation for exponential business growth.

Throughout three days of enlightening experiences, delegates were fully immersed in a multitude of thought-provoking sharing and practical takeaways from top regional leaders. Leadership in innovative disruption era, the art of talent management and engagement, application of AI in HR transformation, an agile & flex organisation in practice, to name a few, were some of the pertinent and hot button topics being discussed at the event.

When asked about the key secrets to creating a great corporate culture and superior workforce, Singapore's leading businesses all said that it is necessary to start with the most basic value, which is our people. Focusing on training and developing human capital, creating a happy working environment to attract and retain talent is no longer an option, but rather a must.

A positive working environment not only directly affects the dedication of employees but also determines their long-term commitment to the organisation.

Tieu Yen Trinh, CEO of Talentnet Corporation, the organiser of Talentnet Business Innovation Showcase 2019, shared: “I am so glad to receive a lot of positive feedback from business leaders and HR practitioners participating in the event. I believe that the trip has brought a torrent of ideas, information, new perspectives, and visions to our delegates, which will hopefully lay the foundations for more effective, high-impact HR strategies. In this competitive and fast-paced era, investing in human capital is always a strategic investment and the smart thing to do, helping businesses retain their competitive edge, be future-ready, and stay ahead the curve."

FE Credit partners with VNPost to improve financial inclusion in Vietnam

FE Credit has officially extended its distribution network in rural areas by co-operating with Vietnam Post Office to launch its new sales channel through post office branches nationwide, giving unbanked people the opportunity to access financial services.

With a desire to bring legal credit to more people in rural and suburban areas while raising the awareness and knowledge of people on consumer finance, FE Credit has expanded its co-operation with Vietnam Post Corporation (VNPost), a network of nearly 10,000 post offices nationwide, to implement many comprehensive and flexible consumer lending packages.

FE Credit has been co-operating with VNPost through two main services: loan disbursement and loan repayment.

Since January 2019, VNPost has been co-operating with FE Credit to provide new loan application services.

Customers can now come to their nearest post office to apply for a loan or look for any financial solution with full assistance from VNPost staff.

The procedure is easy as it only requires simple documents such as a national ID, driving license, and utility/phone/internet bills, and comes with faster processing time. The loan amount can be up to VND70 million ($3,050), which offers an easy money source for customers’ business and other needs.

Customers can now come to their nearest post office to apply for a loan or look for any financial solution with full assistance from VNPost staff.
According to Tran Chi Trung, head of the Postal Financial Services Department at VNPost, most people in rural areas have restricted access to mass media and are more likely to be attracted to black credit which is always difficult to pay back because of extremely high interest rates and debt collections often threaten the safety of their life.

“Through this co-operation between FE Credit and VNPost, people can now visit their nearest post office to apply for a loan or look for a suitable financial solution with simple procedures and fast processing time, which also contributes to gradually pushing back black credit, especially in rural areas where most people have below-average income and cannot access basic financial services without proof of income or collateral,” Trung said.

Nguyen Trong Phu, Affluent Partnership Centre director at FE Credit, said, “Although our distribution network has been expanding, we feel that we still have a long way to go to meet the demands of the large number of people in remote areas. Therefore, expanding the network in rural areas is inevitable and is also the reason FE Credit strengthens its co-operation with VNPost to bring effective, safe, and convenient financial solutions to more Vietnamese people.”

This co-operation not only increases the coverage of FE Credit’s distribution network nationwide, but also enhances convenience in providing financial services for customers. The company focuses on modern technologies in its operating system and deploys digital lending platforms to help shorten the entire loan process.

It takes only 15 minutes from registration to loan approval and the loan is disbursed within 24 hours. This is also one of the efforts of FE Credit to fight back black credit, which is currently causing significant social distress.

FE Credit will continue its partnership with VNPost and bring out more promotions to get customers closer to consumer finance to improve their quality of life.

Viglacera says earnings better than expected this year

Increasing demand for green, environmentally-friendly materials and devices may help Viglacera earn higher-than-expected pre-tax profits this year.

The largest ceramic and tile producer by market value expected actual full-year pre-tax profit to beat projections by nearly 16 per cent, heard the firm’s annual shareholder meeting on Wednesday.

Viglacera had previously set a 2019 target of VND9.3 trillion (US$400 million) in total revenue and VND950 billion in pre-tax profit. The figures would mark an increase of 5.5 per cent and 12.2 per cent year-on-year.

But actual earnings this year may reach VND1.1 trillion in pre-tax profit, 15.8 per cent higher than the original forecast.

According to the firm’s management board, pre-tax profit of VND1.1 trillion was feasible.

In the first half of the year, the group estimated pre-tax profit of its parent unit was VND422 billion, accounting for 65 per cent of the annual target.

The company attributed its confidence in future growth to high demand for green building materials and said it would make further investments in this area.

The company acknowledged difficulties ahead as the property market was showing signs of slowing down and Chinese products were becoming more competitive.

However, the signing of the Europe-Viet Nam Free Trade Agreement (EVFTA) may offer the firm new opportunities abroad for glass exports.

In addition, chances will come from stronger market purchases of solar energy. The solar energy sector has grown strongly in recent years, especially in the south central region.

The Ministry of Construction will continue to sell the State capital it holds in Viglacera to zero per cent by early 2020 in accordance with the Prime Minister’s Decision 1232/QD-TTg dated August 17, 2017.

The construction ministry is holding 173 million Viglacera shares, equal to a 38.6 per cent stake in the company.

The ministry sold 69 million Viglacera shares – accounting for 85 per cent of total shares offered for sale – at an auction on March 29 for VND1.58 trillion.

In 2018, Viglacera posted VND8.8 trillion in total revenue, down 4.2 per cent year-on-year. Its post-tax profit last year fell 10.7 per cent to VND667 billion.

The company debuted on the Ho Chi Minh Stock Exchange on May 29, listing more than 448.3 million shares under code VGC.

It had traded on the Ha Noi Stock Exchange between October 15, 2015 and May 17, 2019 with the same ticket.

Its shares fell 0.5 per cent on Wednesday to close at VND20,800 ($0.89).

Jeju Air offers cheap tickets on routes between RoK, Vietnam

The Republic of Korea (RoK)’s Jeju Air will open its biggest promotion SUPER SALE with one-way price starting from US$15 on Vietnam-RoK route. The selling will run from June 26-July 2.

The promotional program includes a hand baggage of 10 kg and does not offer a free checked baggage allowance. The special tickets will be applied for flights departing from October 27, 2019 to March 28, 2020.

The Korean carrier has operated 6 air routes from RoK to Vietnam’s cities of Hanoi, Ho Chi Minh City, Nha Trang and Da Nang, including the first service, Incheon-Hanoi since December, 2014.

Jeju Air’s routes to Vietnam are just behind the largest markets, Japan and China. The carrier has increased its number of seats from 150,000 in 2015 to 450,000 in 2017. As of October, 2018, the airline provided 720,000 seats.

The budget airline currently serves 72 routes connecting several cities in the RoK and Asia Pacific cities.

 
 
 
 
 
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