What’s cooking? A lot of things, actually
A catering trend is blowing new winds across Điện Thọ Commune in Quảng Nam Province, empowering women, creating off-farm jobs and spreading prosperity. Thiên Thanh has the story.
Chủ Nhật, ngày 11 tháng 12 năm 2016
Vietnam's sugar industry development strategy in a muddle
The figures to which the agriculture ministry (MARD) has been using while drafting the sugar industry's development strategy are not sufficiently reliable.
MARD has decided that by 2020 the total sugar cane growing area would reach 300,000 hectares, while sugar cane output would be 21 million tons with average yield at 70 tons per hectare.
The growing area would be unchanged by 2030, but the sugar cane output would increase to 24 million tons, as the average yield would be 80 tons per hectare
Nguyen Hai, secretary general of the Vietnam Sugar Cane Association (VSSA), said MARD might consider the average yield now (64-65 tons per hectare, according to the ministry) when programming productivity for 2020 and 2030.
However, Hai said that 64-65 tons per hectare is not a reliable figure. “The actual yield is low in Vietnam,” he said.
The sugar cane yield is very high in some areas. In Phung Hiep district of Tien Giang province, for example, farmers can harvest nearly 100 tons per hectare, while in Tay Ninh province, the figure could be 75 tons per hectare. However, the yield is very low in the northern and central regions.
Hai doesn’t think MARD referred to Thailand’s average yield when programming the industry development for Vietnam. He said the sugar cane average yield in Thailand is 65 tons per hectare, not 70-80 tons per hectare, as some sources said.
Le Van Banh, head of the Agro-Forestry-Fisheries Processing and Salt Production Department, said that, considering Thailand’s production, it is necessary to learn about its ‘technology map’, cultivation techniques, varieties, productivity and product quality, and figure out where Vietnam is on the world’s production map.
“We need to know where we are to figure out plans and measures to implement the development program in 2016-2020 and after 2020,” he said.
As the data based on which MARD is drafting the development program is believed to be unreliable, Vu Huyen Duc, deputy chair of VSSA, speaking at a conference to review the 2016-2017 sugar cane crop, asked the plan compiler to revise the program.
A report shows that Thailand’s sugar productivity increased sharply from 6 million tons in 2000 to 11 million tons in 2015-2016 crop. This means that after 15 years, the country’s sugar output increased by 5 million tons. Meanwhile, Vietnam’s output increased by 500,000 tons during the same time, from 700,000 tons to 1.2 million tons.
Many experts have shown concern about the slow development of the sugar industry, saying that the protection policy has made the industry less competitive, with the production cost 30-40 percent higher than the average level in the world.
Kim Chi, VNN
IPP Group seeks investment in Tan Son Nhat airport
The Imex Pan Pacific Company Limited (IPP Group), a Vietnamese diversified conglomerate, has been seeking to invest in a dual-use terminal with a capacity of around 10 million passengers per year at Ho Chi Minh City’s Tan Son Nhat International Airport.
The IPP Group has recently sent a document to the Ministry of Transport (MoT) for the project implementation of the construction and investment in expanding the airport terminal system at Tan Son Nhat International Airport, a close source associated with IPP told VET.
Specifically, IPP has proposed to build another dual-use airport terminal with a capacity of 10 million passengers per year, bringing the total exploitation capacity of Tan Son Nhat International Airport up to 40 to 50 million passengers per year, according to the development plans from now until 2025.
The company will use 100 per cent of investment capital from local resources, not from partnerships or associations with any foreign partners.
IPP’s proposal stems from the government’s policies that allow for the investment, which aims to reduce the load for Tan Son Nhat International Airport. However, with the current pace of development, the IPP Group noted that it will be a while before the terminal is ready to serve passengers.
Nevertheless, Tan Son Nhat Airport, in the short term, needs investments for the expansion. These efforts are combined with the improvement of aircraft parking capacity and taxiways until the Long Thanh International Airport is completed and begins operations in 2025.
The IPP Group is a diversified conglomerate that controls about 60 leading international brands in Vietnam. It has participated in investments in the country’s aviation infrastructure and non-aviation services for many domestic and international airports.
The IPP Group has stakes in a number of ground service companies in Vietnam, which control the system of duty free stores at multiple international airports in Hanoi, Da Nang, Ho Chi Minh City, and Phu Quoc, among others.
It has also engaged in providing non-aviation services at the NAIA Airport in the Philippines and has sought a cooperation agreement with the operating unit of Incheon Airport in South Korea in supporting the operations of airports in Vietnam.
The IPP Group is a private enterprise with over 31 years of investment and development in Vietnam and 47 projects with an investment of over $480 million. In 2015, the company also became a strategic investor in Airports Corporation of Vietnam (ACV).
VN Economic Times
Labour exports hurt by lack of foreign language skills
Few countries have as many of their citizens working abroad as Vietnam, or depend so greatly on labour exports for economic vitality, says the Ho Chi Minh City Department of Labour, Invalids and Social Affairs.
According to the Department, it has supplied an enormous amount of guest workers, nearly 55,600 to foreign markets under official arrangements since 2011, eight out of 10 of whom were unskilled workers.
Out of the total some 31,000 guest workers went to the Japanese market; 12,000 to Taiwan; 5,000 to Malaysia; 3,500 to the Republic of Korea (ROK); and 4,100 worked in other markets.
Thứ Bảy, ngày 10 tháng 12 năm 2016
Land price soars on Phu Quoc Island as a result of billionaires’ race
The investment boom on Phu Quoc Island, with the appearance of the biggest real estate developers, from Vingroup and Sungroup to BIM and CEO, has caused land prices to escalate daily.
“Tran Hung Dao is the most expensive street in Phu Quoc. The land is priced at VND50-60 million per square meter,” said Ty, a taxi driver, pointing to numerous bungalows. They were all built, mostly by private investors, in recent years.
Savills Vietnam, in a market analysis report released recently, said that Phu Quoc is now a ‘golden land’ for tourism development. However, most of the hotels have been developed by locals and are small, while only a few are managed in a professional way.
The report pointed out that by the first quarter of 2016, only 33 percent of hotel room supply on the island, about 2,500 rooms, meet 3-5 star requirements. Sixty percent have been operational for only two years, after the Phu Quoc Airport was built.
When asked about the prices of land plots on Tran Hung Dao Street, Tu, a real estate broker, said the prices vary depending on the position.
“You can buy a land plot on this side of the road at just VND20-30 billion. But if you want the plot on the other side which faces the sea, the price would be VND50-60 billion,” he said.
Thirteen years ago, 1,000 square meters of land could be bought at VND15 million, but now the price is up to VND5-6 billion.
Multi-trillion dong projects
Phu Quoc is the focus of the 2016 national tourism program. Called the ‘pearl island’, it is located in an advantageous position, near international maritime routes and air routes which link Phu Quoc and other regional cities such as Singapore, Siem Reap, Bangkok and Kuala Lumpur.
Many infrastructure projects have been developed by the government since 2012, including the 110 KW national electricity grid (VND2.36 trillion), a transport backbone route (VND1.2 trillion) and the Phu Quoc Airport expansion (VND1 trillion).
The new infrastructure has paved the way for private investors to pour money into Phu Quoc. Vingroup has developed an international passenger port (VND1.6 trillion) and the Safari Zoo (VND3.15 trillion).
Sungroup in April 2016 announced two large projects – Premier Residences Phu Quoc Emerald Bay and Premier Village Phu Quoc Resort. It is also injecting money into JW Marriott, a high-end resort, and The Ritz-Carlton Reverse.
In 2016, the CEO Group started the Novotel Phu Quoc Resort project with investment capital of VND4.5 trillion.
Chi Mai, VNN
BUSINESS IN BRIEF 10/12
Ben Tre coconut value chain shared in Italy
Models and experience on enhancing the value of processed coconut products from the Mekong Delta province of Ben Tre resulting from public-private partnerships have been shared at a programme in Rome.
The event was held as part of the 4P (Public-Private-Producers Partnerships) programme organised by the International Fund for Agricultural Development (IFAD) at its headquarters in Italy’s capital city on December 7.
Ben Tre Import and Export JSC (Betrimex), a Vietnamese company specialising in processing and exporting products made from coconuts, shared their experience in social activities within the 4P Project at the event.
The 4P Project aims to facilitate relationship among the public and private sectors and small producers, enabling farmers to access to markets; the concerned parties taking risks, investing and sharing profits together while improving economic life in rural areas in general and raising incomes for disadvantaged farmers in particular.
In this project, to contribute to local socioeconomic development, Betrimex deployed a model for linkages between businesses and farmers following the value chain associated with coconuts.
According to the Ben Tre Coconut Association, the coconut tree is typical of Ben Tre with the area in which it is cultivated there stretching over 63,000ha, the largest of any province in the country. However, the value created from coconuts for farmers is still not high and not commensurate with the potential of the country's largest coconut-producing region.
Low prices plus dependence on foreign traders make coconut prices fluctuate constantly, having negative effects on farmers’ lives.
In Betrimex’s model, when they signed cooperation agreements with the company, farmers received support with farming supplies such as fertiliser, pesticides and technical training in organic farming to maintain sustainable coconut plantations. The company also covered output consumption for farmers and purchased coconuts right at their gardens.
Betrimex also gave out the floor price with the commitment that even if the market price was lower than the ceiling price, the company would purchase all coconuts from farmers at a higher level, and vice versa.
With incentives and effective support policies to resolve farmers’ worries, after one year of implementation, currently about 540 households are participating in the company’s programme, cultivating an approximate production area of 450ha with a yield of 4.4 million coconuts a year.
Betrimex was the only Vietnam representative to share its experience at the 4P Rome event. Participants reviewed midterm 4P project’s results and exchanged lessons learned during implementation of the project.
Forum repeats Government’s resolve to build facilitating government
The Vietnamese Government is working to build a consistent and effective administrative system that facilitates development and acts for the sake of people and enterprises, considering this the most important task in 2016-2020.
That commitment of the Cabinet was reiterated by Prime Minister Nguyen Xuan Phuc while addressing the 2016 Vietnam Development Forum (VDF 2016), themed “Facilitating and action-oriented government – New driving force for development”, in Hanoi on December 9.
At this year’s forum, instead of presenting reports and prioritised orientations, Vietnam’s Government agencies sought for development partners’ and experts’ viewpoints and assessments of Vietnam’s economic prospects in 2016-2020, impacts on and challenges to the national economy in the coming years, and multi-dimensional effects of global political and economic situations, and bilateral and multilateral trade agreements on the national economy.
Listening to speeches at the forum, PM Phuc said they are useful for Government agencies to precisely evaluate Vietnam’s situation and development prospects amid complex and unpredictable developments in the world, thereby devising appropriate measures to realise the set objectives and plans.
In 2016, the country’s GDP growth is expected at 6.3 percent while foreign reserves are at a record of some 41 billion USD. Despite a nosedive in global trade, Vietnam still enjoys a rise of around 8 percent in exports and 2-3 billion USD in trade surplus, he told development partners.
Stressing the target of rapid, sustainable and inclusive growth that leaves no one behind, he agreed with the development partners on their opinions about factors that can strongly affect Vietnam’s growth outlook such as fluid oil prices, emergence of trade protectionism, public debt payment, non-performing loans, and climate change.
Vietnam will work harder to revamp business climate, improve competitiveness, and have key business climate criteria comparable to the average of Malaysia, the Philippines, Singapore and Thailand – four other ASEAN countries. It will also encourage innovation, start-up and private businesses, he said.
Another solution is pushing ahead with more substantively economic restructuring, and State-owned enterprises equitisation in line with the market mechanism, he said, asking the World Bank (WB), especially its International Finance Group, to help Vietnam deal with non-performing loans which, experts said, will influence macro-economic stability and growth if they are not settled soundly.
He also called for the WB and other development partners’ support to ensure social welfares, protect the environment and respond to climate change.
Co-chairing the VDF, WB Country Director for Vietnam Ousmane Dione congratulated the country on a stable macro-economy for five straight years, deeming this as an important foundation to accelerate growth and development.
He said to achieve the set targets, Vietnam should perfect its market mechanism and market-oriented approach. The socio-economic development plan for 2016-2020 should be aimed to bring about greater benefits for people. ODA capital also needs to be used in a more effective fashion in order to promote the private economic sector.
He expressed his belief that with the Government’s commitments and strong actions, Vietnam will attain ambitious goals, and development partners will assist it with knowledge, experience and best practices.
The VDF 2016 is a new approach to the cooperation relationship between Vietnam and development partners. This approach is derived from the Consultative Group Meeting for Vietnam and the Vietnam Development Partnership Forum.
VIB wins “Bank of the Year 2016” award
Vietnam International Bank (VIB) has won the “Bank of the Year 2016” award, making it the first local bank to receive the prestigious award for two consecutive years.
The award was presented by The Banker (Financial Times) magazine in London (United Kingdom) on December 7.
In addition to VIB’s efforts in business operations reflected by Tier 1 capital, total assets, net profit, return on equity (ROE) and non-performing loan ratio, The Banker highly praised the bank for its transparent management model, sustainable growth strategy, and efficient support for Start-up and small and medium-sized enterprises.
Besides, VIB’s application of advanced banking technologies, continuous innovation, and efficient and effective marketing activities during the year based on its understanding of market segments were also well recognised by The Banker, which then helped the bank make a difference on the market.
Over past 10 months, the bank’s total assets and capital adequacy ratio (CAR) reached more than 93 trillion VND (over 4 billion USD) and 14.46 percent, respectively and the bank's equity reached 8.38 trillion VND, while its non-performing loan ratio decreased sharply to 1.49 percent.
VIB is one of the few local banks selected by the State Bank of Vietnam (SBV) to pilot Basel II. Among the banks selected for pilot implementation of the Basel II, VIB has the highest readiness level with its CAR of approximately 13 percent according to Basel II standards. Specifically, VIB’s advanced technology platform is also well in place for Basel II.
Previously, VIB was approved by SBV to increase its charter capital to more than 5.64 trillion VND in a move to help expand the bank’s business activities.
In the latest report by Moody’s, VIB had its credit rating upgraded to B2, making it continue to be in the top banks with the leading credit ratings in the market.
The “Bank of the Year” award is exclusively granted to the top bank in each country. It is the world’s longest running and most prestigious international banking title.
Each year, The Banker selects one winning bank for each of the countries judged. Over 1,000 applications from 154 countries are collected and judges select winning banks based on evidence provided to determine the bank in each country which saw the maximum overall progress in the past 12 months.
The judging is carried out by an editorial committee on the basis of submitted entries, data from The Banker's Top 1000 database and the editors' personal knowledge of the market.
Vietnamese firms updated on Cambodia’s investment policy
The Cambodian Government’s new policies on investment attraction and facilitation to foreign investors were introduced to Vietnamese enterprises attending the 7th Mekong Forum in Phnom Penh on December 9.
Accordingly, the Cambodian Government will neither restrict currency trading nor control capital and goods prices, while maintaining one-stop-shop services, and import tax exemption for machinery and materials.
Representatives from the Vietnamese side also updated participants on the country’s bilateral economic cooperation policies, affirming that the Vietnamese Government always creates favourable conditions for and encourage Vietnamese companies to expand investment and business in Cambodia.
Hosted by the Vietnam, Laos and Cambodia Economic Development and Cooperation Association (VILACAED) of Vietnam, the event is part of activities to mark the 50th founding anniversary of Vietnam-Cambodia diplomatic ties.
It offered a good chance for enterprises from the two countries to share information and establish partnerships, contributing to further promoting trade links within the ASEAN Economic Community.
On the occasion, several Vietnamese outstanding enterprises and entrepreneurs were presented with awards in recognition of their effective investment and business in Cambodia and remarkable contributions to the country’s socio-economic development.
Vietnam is one of Cambodia’s leading economic partners with two-way trade reaching 3.4 billion USD in 2015.
As of May 2016, Vietnamese businesses operated 183 projects worth 2.85 billion USD in Cambodia.
Meanwhile, Cambodia ranked second among over 60 countries and territories attracting Vietnamese enterprises. Direct investment from Vietnam in Cambodia has recorded a strong surge, especially in agriculture, forestry, energy, finance-banking, insurance, and telecommunication.
Grab to pay drivers’ taxes soon
Grab, a technology company offering a wide range of ride-hailing and logistics services through its mobile app, will start paying taxes on behalf of its partner drivers from December 12.
Grab Vietnam is assigned to collect and pay taxes on behalf of its partners who do not pay taxes via transport business units. Therefore, the firm is responsible for filing and paying value-added tax and personal income tax imposed on its partner drivers.
Grab’s partner drivers in Vietnam are taxed 4.5% on their earnings, of which 1.5% is personal income tax and 3% is value-added tax. In addition, they pay 1% from Grab’s rewards.
The firm will charge service fees on its ride-hailing mobile app (20% of earnings) but will not deduct tax payments for organizations and individuals paying taxes via transport business units. These organizations are responsible for paying taxes on behalf of their own partners.
In related news, Uber, also a ride-hailing service provider, has finished its declaration and tax payment procedures. The company also pays taxes on partner drivers’ behalf when using the Uber app.
IFC and Loc Troi join forces in sustainable rice farming
International Finance Corporation (IFC), a member of the World Bank Group, said on December 7 it is cooperating with Loc Troi Group to apply sustainable farming standards and practices in the local firm’s rice value chain.
The partnership is to help Vietnam’s agricultural sector to expand rice trade globally, increase profit and improve the livelihoods of farmers.
According to an agreement between the two sides, IFC will support Loc Troi to apply the Sustainable Rice Platform (SRP) standards so that farming households will be able to use resources efficiently. Around 4,000 farmers will be trained to produce high-quality rice in the initial phase and the number of beneficiaries will increase in the next phases.
IFC has invested in and given advice to the private sector in developing countries over the past 60 years.
Its investments in Vietnam have reached US$5.6 billion since 1994. The organization has supported Vietnam to carry out 120 projects in sectors like infrastructure, production, agriculture, renewable energy and finance.
Huynh Van Tho, chairman of Loc Troi Group, was cited in an IFC statement as saying that Loc Troi will strictly monitor quality and carefully check all stages of its value chain. Paddy growers will be trained to apply SRP standards to their farming areas to build a rice brand that can compete on world markets.
Ping Kitnikone, Canadian Ambassador to Vietnam, said IFC’s consulting activities in Vietnam’s agriculture sector are backed by the Canadian government. Canada supports Vietnam to pursue sustainable economic growth by improving the competitiveness of its agriculture and taking measures to cushion the impact of climate change.
The initiative is to help Vietnam with its agricultural restructuring program whose objectives are to improve the farming sector’s competitiveness and make the most of opportunities on global markets.
Vietnam, one of the world’s biggest rice exporters, is facing tough competition with Thailand, India, Pakistan, Cambodia and Myanmar.
Kazakhstan wants to cooperate with Vietnam in railway sector
Kazakhstan expressed its interest in cooperating with Vietnam in railway transport, thus promoting bilateral trade between the two countries in the years to come.
Last year saw a sharp fall in bilateral trade due to Kazakhstan’s economic recession. Specifically, two-way trade reached US$162.1 million, falling 71% against 2014, according to data released on December 7 by the embassy of Kazakhstan in Vietnam.
Of the total, Vietnam’s exports to Kazakhstan accounted for US$153 million, down 70% year-on-year, and imports made up US$9.1 million, dropping 87%.
At a press conference held on December 7 on the occasion of celebrating 25 years of Kazakhstan’s Independence Day, Beketzhan Zhumakhanov, Kazakh Ambassador to Vietnam, said bilateral trade in the first ten months of this year has bounced back to US$275.5 million, with Vietnam’s exports and imports making up US$155.8 million and US$120.5 million respectively.
In May 2015, Vietnam and the EAEU, which comprises Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia, signed a free trade agreement (FTA), which will spur trade between the two sides as 90% of tariff lines are slashed to zero, Beketzhan Zhumakhanov added.
According to the embassy, Vietnam’s major exports to Kazakhstan include farm produce and garments, while it imported steel and vehicles from the member state of the EAEU.
However, cargo transport from Vietnam to Kazakhstan faces many challenges owing to the geographical distance. The shipping time could last around two months, affecting the quality of farm produce exported from Vietnam.
Transport is an important factor for fostering business and trade cooperation between the EAEU and Vietnam. Therefore, Kazakhstan wants to boost cooperation with Vietnam in the railway sector to facilitate trade, the ambassador said.
The ambassador also believed the opening of a railroad will make it easier for transporting goods of ASEAN member countries to the EAEU.
Carbon footprint vital for company position
Enterprises need to calculate their carbon emissions and announce non-financial statistics besides financial ones to position themselves in a changing market, heard a conference named Carbon Footprint-Corporate Solutions for Sustainable Growth in HCMC on Tuesday.
Min Hwa Hu Kupfer, chairwoman of Vietnam Holding (VNH), told the conference that a firm’s investment and development go hand in hand with social and environmental responsibilities, which is an inevitable trend.
Green investment is not new to foreign businesses but quite strange to Vietnamese peers. Therefore, VNH held the conference to help local companies understand and do carbon footprint calculations.
Attendees at the conference also discussed climate change, policy and corporate solutions to manage energy consumption and greenhouse gas emissions.
The chairwoman said environmental information disclosure, including carbon footprint, will make differences among companies.
Vu Quang Thinh, chief executive officer of VNH, said enterprises have to find solutions to contribute to the fight against climate change and rising sea levels which will directly affect their operations.
Tran Anh Dao, deputy general director of the Hochiminh Stock Exchange, told the conference that businesses create jobs for people and pay taxes to the State. However, they also cause greenhouse gas emissions that contribute to global warming and extreme weather conditions.
Dao said now is the right time for businesses to act to protect the planet for future generations.
Nick Beglinger, an expert in sustainable growth and a member of the World Wild Fund for Nature, said local firms could seek advice from experts to calculate their carbon emissions when they consider new investment projects.
They can make clear price differences and the efficiency when choosing clean or dirty technologies, coal-fired or renewable energy, and baked or unbaked bricks, to name just a few. He said an initial investment may be huge but operating costs will drop in the long term.
Beglinger affirmed that in the long run investment in clean technology will bring in higher profit than outdated technology. Investors will prefer enterprises using clean technology, he noted.
In the near future, consumers will buy products of such businesses. Firms’ statistics about environment, energy and gas emissions will be part of their competitiveness indexes, he added.
Expert Nguyen Dang Anh Thi told the conference that many big enterprises have pledged to provide information about electricity, water and heat consumption and carbon emissions on products’ tags by 2018. Customers will look at businesses’ actions when making purchases rather than only shareholders and State management agencies.
He said capital mobilization for projects that apply clean technology will be easier than for those with dirty technology.
Min of VNH said enterprises have to do carbon footprint calculations and control carbon emissions as many more shareholders and investors pay attention to these matters. She said VNH itself makes carbon footprint calculations and wants a low level of carbon emissions in its portfolio.
DAS Capital to invest US$150 million in ITA
U.S.-based financial investment fund DAS Capital plans to pour around US$150 million into Tan Tao Investment & Industry Corp. (ITA) to become a strategic shareholder of the Vietnamese industrial zone developer.
A source from the local firm said a delegation of DAS Capital had a meeting with ITA leaders to discuss the deal early this week.
Headquartered in Los Angeles, DAS Capital has opened many branches in Asia such as Hong Kong, Singapore, South Korea, Japan and Malaysia. With a portfolio of US$5 billion, it is exploring investment opportunities in emerging markets such as Vietnam.
DAS Capital has been interested in ITA shares and is looking for opportunities to become its strategic shareholder, the source said.
Both sides have reached agreement in principle on some basic matters. In the first stage, the fund will buy around US$20 million worth of ITA shares before adding more capital to raise the total investment to US$150 million.
DAS Capital has viewed Vietnam as an emerging and potential market with high gross domestic product (GDP) growth in the region. Notably, Vietnam is going to sign many new-generation free trade pacts, making it a plus in attracting foreign investors.
This is the first time DAS Capital has considered investment in Vietnam. Aside from developing industrial zones, ITA has tapped many other sectors such as health, education, real estate, thermal power and infrastructure.
Fintech ﬁrm GoBear enters Vietnam
Tran Nhat Khanh, country director of GoBear Vietnam, looks on - PHOTO: DUC TAM
HCMC - Fast-growing fintech firm GoBear, Asia’s first comprehensive metasearch engine for insurance and banking products, has made debut in Vietnam by launching its comparison services for the products in the fields.
The Singapore-based startup said it offers customers in Vietnam its financial product comparison that is online, easy to use, personalized and free of charge.
Andre Hesselink, founder and chief executive officer of GoBear, told the launch event in HCMC on December 7 that the company has expanded to Vietnam to bank on growth opportunities driven by increasing numbers of customers in the fields and Internet users and high smartphone penetration in this market.
GoBear’s entry into Vietnam follows its successful operations in other major Asian markets. The firm was launched in Singapore last year before extending its presence to Thailand, Malaysia, Philippines and Hong Kong.
GoBear said in a statement that more than 4.5 million users have put their trust in the firm when it comes to comparing insurance and banking products such as credit cards and personal loans. As one of the fastest growing fintech startups in Asia, GoBear has helped simplify financial shopping experience which is often complicated and full of jargons.
“GoBear was formed on the idea of the need for an online tool to help users search for complex financial products in a transparent and unbiased way… we provide a transparent overview of the market and with our personalized search and filtering functions, consumers can have a side-by-side comparison easily based on their needs,” Hesselink said.
In Vietnam, GoBear provides credit card and personal loan comparison services at gobear.com/vn for nearly 200 credit cards and 30 lending facilities selected from a variety of some 50 existing banks and finance companies in the market.
Hesselink said it is expected that with GoBear customers can find products that they are looking for.
Tran Nhat Khanh, country director of GoBear Vietnam, said GoBear does not sell products directly to customers but instead simply offers a free and transparent comparison experience based on personalized needs.
“Users do not buy anything from GoBear. We display information about different credit cards and personal loans available in the market for users to easily compare and choose the ones that best fit their needs,” Khanh said.
SBV: Secured loans account for majority of bad debt
Bad debts secured by assets make up most of all the non-performing loans but banks still have difficulty handling those properties, resulting in a deadlock in debt settlement, said the State Bank of Vietnam (SBV) at a conference in HCMC on December 6.
According to a notice released by the central bank’s media department, secured debts make up more than 90% of the total bad debt.
Credit institutions have met obstacles in handling mortgaged assets due to a lack of regulations or inconsistent laws, the department said. Meanwhile, the 2015 Civil Code, which will take effect early next year, has no specific regulations guiding how to take over mortgaged assets.
A number of lenders told the conference that they have encountered difficulties when allowing clients to register real estate projects as mortgaged assets due to unclear regulations on the handling of mortgaged assets. Therefore, it takes credit institutions much time and effort to deal with mortgaged assets.
Foot-dragging law enforcement is costly and places significant impact on banks’ operations.
Vu Dinh Anh, a financial expert, noted that handling mortgaged assets is meant to offset losses caused by bad debt. However, borrowers usually do not closely cooperate with and sometimes confront lenders when they deal with mortgaged assets.
Anh said both sides should coordinate to cope with this matter efficiently.
Lawyer Nguyen Thi Phuong from the Vietnam Banks Association said the right to deal with mortgaged assets is a civil right. Credit institutions are permitted by law to handle mortgaged assets.
As the 2015 Civil Code that will take effect from January 2017 does not have specific regulations on mortgaged asset confiscation, the Ministry of Justice should coordinate with relevant ministries and agencies to study and issue such regulations to support lenders, according to the central bank.
SBV pays tribute to GIZ Vietnam
The State Bank of Vietnam (SBV) held an awards ceremony to honor GIZ Vietnam leaders and managers with the Diploma of Merit and Commemorative Medal, given by the SBV Governor on December 8.
Since 1993, the German government through GIZ has repeatedly organized large scale programs and projects to support the Vietnamese banking system in its projects to develop in a sustainable manner.
The Ambassador of the Federal Republic of Germany in Vietnam Mr. Christian Berger, witnessed Deputy Governor of SBV Mr. Nguyen Dong Tien award the Diploma to the Country Director of GIZ Vietnam, Mr. Jochem Lange.
The Commemorative Medals for contribution to the development of the Vietnam Banking system have been awarded to Mr. Lange, GIZ's Chief Technical Advisor and Program Director in Viet Nam, Dr. Michael Krakowski, and other managers and staff of the program to acknowledge the significant contributions of individuals and GIZ in helping to reform and develop the Vietnam banking system.
SBV’s Governor highly praised the value of GIZ during the recent times of banking changes, seeing this as a symbol of the “deep, trusted, sincere friendship” and expressed the hope that SBV would continue to receive the support from the German government via the Embassy of the Federal Republic of Germany in Vietnam and GIZ.
’The Prime Ministers of both countries have mutually agreed that the project of developing the financial system as part of the strategic cooperation relationship is especially valuable in the Hanoi Joint Statement issued in October 2011”, said Ambassador Berger.
GIZ has actively cooperated and supported SBV to finalize the necessary mechanisms and regulatory framework. This has allowed the central bank to fulfill its function as well as ensuring a safe and effective operation for the banking system.
The German organization has played a huge role in helping to design the Law on State Bank of Vietnam, the Law on Credit Institutions, monetary policies and especially the open market operations, anti-dollarization strategy and planning, the internal management framework and internal audits for commercial banks.
GIZ has also always focused its efforts on improving the capacity of bank staff. GIZ and SBV have held comprehensive basic and in-depth vocational training programs both in Vietnam and overseas for banking directors and experts.
With its Macroeconomic Reforms - Green Growth Program, GIZ has been actively cooperating with SBV to finalize the mechanism and policy framework while at the same time improving the capacity of the finance-banking-green credit, helping the central bank to successfully implement the green growth mission and reform the economy in a sustainable manner.
Even though the implementation of the program has not been long, GIZ has made remarkable contributions to the writing of many policies and initiating projects, laying the foundation for the reform and development of the green banking in the future.
In order to implement the National Strategy for Green Growth and the National Action Plan on Green Growth for the 2014 – 2020 period, the SBV's Governor issued Directive No.03 dated in 2015 to promote green credit and social and environmental risk management in the credit activities.
Vingroup plans to divest stake in Phat Loc Express
Vingroup is planning to divest its stake of 79.96 per cent in Phat Loc Express, formerly known as Vinlinks.
The Nikkei Asian Review revealed that Phat Loc Express achieved sales of over $9 million in 2015, and the purchase price will likely be a similar amount.
A representative of Vingroup, however, told VET that Vingroup may sell the logistics company at an, as yet, undisclosed time so detailed information from Vingroup has not yet been revealed. “We have just mentioned this issue in a shareholder meeting,” she added.
Vingroup last month signed a memorandum of understanding with SG Holdings, the parent firm of Japanese logistics provider Sagawa Express. This move would see the latter expand its presence in Vietnam.
SG Holdings said in a statement that the partnership with Vingroup aims to solve the logistics issues in tandem with the growing retail business, according to Nikkei.
Vingroup launched Vinlinks in July last year after acquiring almost 80 per cent of the Hop Nhat Group which was bought for the equivalent amount that Vingroup will selling Phat Loc Express for. The Nikkei also revealed that in addition to the stake purchased from Vingroup, SG Holdings will buy the entire stake of Phat Loc Express.
The Phat Loc Express is the fifth largest delivery service player in Vietnam with warehouses in four major provinces and cities including Hanoi, Ho Chi Minh City, Da Nang and Can Tho. It has over 200 transaction points across the country.
SG Holdings entered Vietnam in 2012. Last month, its subsidiary Sagawa Vietnam completed the construction of a multi-tenant facility in Dong Nai, after opening door-to-door delivery service counters in Takashimaya in Saigon Centre, one of the Ho Chi Minh City’s biggest shopping malls.
Vingroup is one of Vietnam's leading property developers with a network of consultant partners and leading global designers and quality real estate projects and services. It has recently secured an additional international syndicated loan of $300 million to finance its real estate developments and reorganize its debts, following its first international syndicated loan of $150 million in 2013.
Alongside the core business of real estate development, Vingroup is the operator of the local retail market network which includes shopping malls, supermarkets and convenience stores.
Previously, Vingroup signed cooperation contracts with nearly 250 local enterprises in seven industries - food, cosmetics, stationary, toys, household appliances, fashion and textiles. This was done under its program to support and promote domestic production. The enterprises are from eight cities and provinces nationwide.
Vingroup and its subsidiaries VinCommerce, Vincom Retail, VinEco, and VinDS offered solutions packages for these enterprises, such as incentive policies to distribute their products within the group’s networks and to enhance their brand presence.
VnSteel lowering ownership at KMT
Vietnam Steel Corporation (VnSteel) has registered to sell over 4.7 million KMT shares of Central Vietnam Metal Corporation (Cevimetal).
After the sales, VnSteel will lower its ownership rate from 82.95 per cent to 36 per cent. Expected trading will happen from December 12, 2016 to January 4, 2017 through order matching and agreements. “The target of selling KMT shares is to divest”, said Mr. Doan Phong, member of Finance Department at VnSteel told VET.
KTM shares are traded at about VND 10,000 ($0.44) per share on the stock market. VnSteel will receive about VND47 billion ($2.06 million) based on this price. This share increased significantly in November.
Currently VnSteel holds nearly 8.2 million KMT shares (the rate of 82.95 per cent). After successfully divests, VnSteel will reduce its ownership rate to about 36 per cent of KMT chartered capital.
Cevimetal is a subsidiary of VnSteel. Their main business is supplying different kinds of steel to various projects and importing-exporting metal, steel billets. During the first nine months of 2016, the net sale of Cevimetal reached VND1.3 trillion ($57.22 million). After-tax profit was VND4.8 billion ($211,340) which was twice the amount the same time in 2015.
In the third quarter off 2016, the net sales of Cevimetal reached VND 342.3 billion ($15.05 million). After-tax-profit was VND793 million ($34,907) which was higher than their profit after tax in the second quarter 2016.
The total assets of Cevimetal were worth about VND504 ($22.2 million) in the third quarter 2016. The company equitized and officially went into operation in the form of a joint stock company in January 1, 2006. Cevimetal has a nationwide network of units; it supplies various kinds of steel with an attractive sales policy.
VnSteel was established by merging Metal Corporation and Steel Corporation. The birth of VnSteel is associated with the history and development of the country's metallurgical industry. It has set a solid foundation for the development of the domestic steel industry. VnSteel operates as a joint stock company with over 50 subordinate units, subsidiaries and associated companies.
The main sectors of VnSteel are steel manufacturing and business and the materials and equipment related to the steel industry. In addition, VnSteel also enhances business areas such as finance investment, port operators, logistics services, warehousing, offices, investment and trading infrastructure of industrial zones and real estate, and labor export.
Along with market development in Vietnam steel, VnSteel also pays attention to sustainably develop the environment, protect it and use national resources reasonably. Moreover, this company takes care of social benefits.
January-November import of cars decreases
Vietnamese auto businesses spent US$174 million to import some 10,000 complete built up (CBU) units in November, an increase of 1,000 units and $12 million in comparison with the previous month.
A report from the General Office of Statistics (GOS) revealed that some 97,000 cars were shipped to Viet Nam during the January-November period, with the total value at nearly $2 billion. The figures marked a year-on-year decrease of 12.9 per cent in volume and 19.6 per cent in value.
The decrease in total value is said to be a result of the adjustment of special consumption tax early this year. As of January 1, the special consumption tax on imported cars is calculated keeping in mind their cost, insurance and freight value, plus current import tariff.
Seven months later, the tax witnessed another adjustment as it was significantly increased by between 60 per cent and 150 per cent of the car value on vehicles with high engine displacement.
With the decrease in both volume and value in the first eleven months of this year, total import value this year will definitely be lower than the previous year.
The country last year saw 126,403 imported CBUs, with the value of more than $3 billion, according to the GOS.
Harley-Davidson opens showroom in Da Nang
The first American-made motorcycle, the iconic Harley-Davidson, has introduced its first showroom in the central and central highlands region in Da Nang city.
It’s also the third official authorised agent of the American motorcycle manufacturer in Viet Nam after HCM City and Ha Noi.
The Da Nang-based centre, which was invested by Al Naboodah International (Viet Nam) company, will provide full service, spare parts, and accessories for modification among motorcycle lovers in the central region.
The centre also introduces new manufactured motorcycle models – Milwaukee-Eight, Touring, the Sportster, Harley Davidson Street 750, Iron 883, and Custom Vehicle Operations (CVO) – from the mother company.
Harley Davidson Da Nang also offers hire-purchase and Harley Owner Group Assistance (a roadside rescue and recovery facility) for customers.
The famous American motorcycle manufacturer introduced its first showroom in HCM City in 2013 and Ha Noi in 2015.
Harley Davidson was made popular in HCM City during the American war in the 1960s, but the motorcycle has become a firm favourite on Ha Noi streets, with the capital’s 80-strong Harley-Davidson club making its debut in 2010.
According to the Viet Nam Registration Department, 8,682 motorbikes with engine capacities of more than 175 cc were imported to Viet Nam between 2014-15.
Interbank rate peaks after 7 months
Overnight rate as well as one-week and two-week interbank interest rates shot up in December to a general 3-3.5 per cent per annum, in comparison with the below one per cent in the previous month.
In the past two weeks, interbank interest rates have shown the tendency to increase with great amplitudes for all three maturity dates, the Research and Investment Advisory Department at Bao Viet Securities Joint Stock Company (BVSC) said.
The average overnight rates increased by 1.45 per cent to 3.04 per cent annually, the one-week interest rates increased by 1.49 per cent to 3.18 per cent, whereas the two-week rates increased 1.34 per cent to 3.42 per cent annually.
The State Bank of Vietnam announced credit growth at the end of November 2016 to be 15.8 per cent, while capital formation growth reached 15.2 per cent.
According to BVSC, the rapid increase in credit growth for the last month was not an irregular movement, as the demand for loans across the economy generally spikes at the end of the year. Surplus liquidity due to rapid credit growth, together with a certain amount of VND leaking into the foreign currency sector following several recent exchange rate changes, would serve as one of the direct causes pushing interbank interest rates to a new level.
BVSC expected interbank rates to maintain the current high in weeks to come, fluctuating at 3-4 per cent per annum.
Half of Asia-Pacific SMEs predict growth in exports: survey
Nearly half of small- and medium-size enterprises (SMEs) in the Asia- Pacific region say that their revenue from intra-regional exports will grow over the next 12 months by an average of 22 per cent, according to a global research survey conducted by FedEx Express.
SMEs in the Asia-Pacific region, which derive an average of more than 68 per cent of their revenue from exports, are capitalising on the growth potential of other markets in the region.
Karen Reddington, president of FedEx Express in the Asia-Pacific region, said research showed that despite challenging global economic conditions, SMEs in the region were tapping other Asian markets for growth opportunities.
“What emerges is a broadly optimistic picture, with SME exporters in the region planning to embrace technology and the digital economy to help overcome a wide range of business challenges, from higher production costs to increasing competition,” she said.
The study also revealed a sense of optimism among the SMEs largely fueled by e-commerce potential.
Eighty per cent of the region’s SME exporters leverage e-commerce to sell to other markets, and 44 per cent of them foresee growth in e-commerce revenue in the next 12 months.
In line with the boom in e-commerce, momentum is building behind m-commerce (purchases made using mobile devices) and social commerce (purchases made via social media platforms).
Some 68 per cent of small businesses in the region are currently selling their products via mobile applications and 67 per cent offer customers the option of making purchases via social media platforms like Facebook.
M-commerce and social commerce account for an average of 22 per cent of regional SMEs’ export-driven revenue.
SMEs believe that both kinds of e-commerce will continue to drive growth. Nearly half of all SMEs expect their m-commerce (47 per cent) and social commerce-driven (49 per cent) revenue to increase over the next 12 months.
Competing in the digital economy, however, presents new challenges. Almost four out of ten (38 per cent) of SMEs in the region cited increasing international competition as a top business challenge.
To navigate this new competitive landscape, small businesses also see technology as the means to cope. Thirty-seven per cent of them say they plan to invest in new technology to overcome business challenges, and almost two-thirds (65 per cent) believe that doing so will also help them export more in the future.
SMEs also see the value of an efficient supply chain, which is essential to meet customer expectations, helping SMEs win customers and improve bottom lines.
More than 90 per cent of Asia-Pacific SMEs agree that “logistics plays an important part in their export businesses”.
E-commerce, in particular, is driving demand for faster delivery, with a significant 66 per cent of SMEs in the region engaged in e-commerce, indicating that they are willing to pay a premium for faster delivery services.
“This research study confirms our long-held view that, for SMEs, technology and supply chain solutions dramatically level the playing field in competing with larger players,” Reddington said.
“Increasingly, SMEs are investing in technology and looking to their logistics providers to help them adapt to their customers’ evolving needs, penetrate new cross-border markets, and ultimately ensure that their businesses remain competitive and sustainable.”
The independent study titled “Global Trade in the Digital Economy: Opportunities for Small Businesses” was conducted by Harris Interactive on behalf of FedEx to provide insights into global export opportunities and challenges facing SMEs.
Completed in September, the results were based on interviews with a total of 9,000 senior executives of SMEs from 17 markets across four regions.
FedEx Express, a subsidiary of FedEx Corp., is the world’s largest express transportation company, providing delivery to more than 220 countries and territories.
APEC dialogue looks to create dynamism for growth, integration
An Asia-Pacific Economic Cooperation (APEC) dialogue with businesses was held in Ha Noi on December 8 with the theme “Creating new dynamism for growth and integration.”
The dialogue, an initiative of Viet Nam as the host of APEC activities in 2017, drew some 400 delegates from international and regional organisations, commerce chambers, associations and businesses from APEC economies.
Alan Bollard, executive director of the APEC Secretariat, and Antonio Basilio, director of the APEC Business Advisory Council’s International Secretariat, were among the keynote speakers.
Opening the dialogue, Deputy Foreign Minister Bui Thanh Son, chairman of the 2017 APEC Senior Officials’ Meetings, said Viet Nam wants to turn APEC into a forum for the sake of people and businesses. Diverse activities involving enterprises will take place throughout 2017.
Meanwhile, Chairman of Ha Noi People’s Committee Nguyen Duc Chung highlighted the Vietnamese capital city’s reform and integration efforts and reiterated commitments to revamping local business climate change towards a big hub in Asia-Pacific.
He highly valued the APEC dialogue’s cooperation focus on business facilitation, trade liberalisation and technical economic investment and cooperation, adding that Ha Noi expects APEC 2017 will effectively implement the prioritised orientations on sustainable and inclusive growth, creativity and regional economic connectivity to improve small and medium enterprises’ competitiveness and ensure food security and sustainable agriculture.
He stated that Ha Noi welcomes and will always create a favourable environment for business cooperation for mutual development. It hopes more and more APEC partners will consider this city a trustworthy destination for cooperation and investment.
At the dialogue, entrepreneurs appreciated APEC’s efforts to promote trade and investment liberalisation and build an open and transparent business and investment environment. They also voiced their wish to join in and practically contribute to APEC’s cooperation in 2017.
VN, Malaysia work to meet $15b trade target
Bilateral trade between Viet Nam and Malaysia should be strengthened further as the two countries have set a two-way trade target of US$15 billion by 2020.
During a dialogue with 20 Malaysian firms in Kuala Lumpur on Thursday, Vietnamese ambassador Pham Cao Phong answered many queries and promised to convey the suggestions made to Vietnamese authorities.
Malaysian firms spoke highly of Viet Nam’s trade policies and offered suggestions to increase exports to Malaysia, including conducting marketing campaigns at home and abroad, building and promoting trademarks for favourable products and improving the quality of food preservation. Malaysia currently imports agro-forestry-fishery, iron and steel products from Viet Nam.
Several Malaysian firms also expressed interest in building processing plants and preservation warehouses in Viet Nam.
At the event, the Vietnamese embassy and Malaysian firms agreed to establish a Malaysia-Viet Nam Trade Office in Malaysia, which will represent Malaysian firms doing business in Viet Nam.
On the same day, a roundtable conference was held between Vietnamese and Malaysian firms in Ha Noi. In his speech at the event, deputy minister of industry and trade Do Thang Hai said the two countries have yet to explore the full potential of trade exchange.
Viet Nam could ensure a steady supply of agricultural products such as rice, tea, coffee, seafood and pepper to Malaysia on a long-term basis, Hai said, even as he invited Malaysian firms to come to study Viet Nam’s market and seek new business opportunities.
Hai suggested that the two governments review trade rules and clear obstacles relating to administrative procedures, customs, standards and quarantines.
Both countries need to share their experience and technology transfer in the fields of energy, oil and gas, mechanical manufacturing and agri-fishery product processing. There should also be closer co-operation to develop value chains in oil and gas, agriculture, seafood, footwear, garment and textile, and support industry, Hai said.
At their end, Zafrul Tengku Abdul Aziz, president of Kuala Lumpur Business Club, invited Vietnamese enterprises to visit Malaysia to exploit investment opportunities.
Two-way trade between the two nations touched US$6.8 billion in the first 10 months of this year, up 3.4 per cent year-on-year, according to the General Statistics Office.
During this period, Viet Nam exported $2.7 billion worth of goods to Malaysia, down 14 per cent, while its imports witnessed a yearly rise of 19 per cent, to $4.1 billion.
Bilateral trade would likely reach $8.1 billion by year-end, which will be 4.3 per cent higher than 2015, the Ministry of Industry and Trade has forecast. Of this, Viet Nam’s exports would be $3.2 billion and its imports may hit $4.9 billion, which suggests that Viet Nam will see a trade deficit of around $1.7 billion, nearly three times higher than that seen in the previous year.
In terms of investment, Malaysia has pumped $412 million into Viet Nam over the past 11 months, ranking 11th among the 68 countries and territories investing in the country, as per data from the Foreign Investment Agency.
Record high fruit and veggie exports in 2016
Fruit and vegetable exports hit US$186 million in November, bringing the value in 11 months of this year to approximately US$2.2 billion, up from the 2015 record of $1.8 billion.
Vietnamplus.vn cited statistics from the Ministry of Agriculture and Rural Development as saying that China was the largest market for Vietnamese vegetables and fruits, accounting for 70.4 per cent. It was followed by South Korea with 4 per cent, the US (3.5 per cent), and Japan (3.1 per cent). Meanwhile, Viet Nam spent $814 million on imported vegetables and fruits, mainly from Thailand and China, in the period, up 44 per cent year-on-year.
Earlier, the ministry forecast the export value of domestic fruits and vegetables would likely reach US$2.5 billion by the-year end.
According to the ministry, the vegetable and fruit industry grew from exporting $235 million to 36 markets in 2005 to exporting $1.8 billion to 60 markets in 2015.
The export value in 2015 reached a record high of $1.8 billion, 123 per cent higher than in 2014.
Vietnamese exporters have promoted vegetable and fruit exports to both traditional and new markets, including markets with strict rules, such as the US, EU, Japan, South Korea, Canada, Australia and New Zealand.
In order to promote fruit and vegetable exports, Viet Nam should review plans for growing fruit and vegetables for export, suggested the Ministry of Industry and Trade.
Initially, the State would concretise the general plan for agricultural development by 2020 and towards 2030. Under the plan, the development of fruit and vegetables would be implemented closely in advantageous regions with each province developing one or two major types of fruit trees.
Production would be expanded, with the growing of some trees to meet the demands of importers and also provide material for export processing factories.
Daiei Kankyo Japan wants to invest in Thanh Hoa
Daiei Kankyo, a Japan’s foremost waste management business group wants to invest in Thanh Hoa province, especially in environment, said its representative, Mr.Tatsuo Yamashita at a recent working session with provincial leaders.
Mr Yamashita proposed cooperation fields such as waste water treatment at Nghi Son Economic Zone, and waste and waste oil treatment and recycling techniques.
In the coming time, the company will discuss projects related to environment treatment in details with relevant authorities, he said.
Thanh Hoa has attracted investment in domestic waste management and treatment of waste water from Nghi Son EZ. Five areas have been zoned for domestic waste treatment with a daily capacity of 5,000-10,000 tons each.
The province has also made a pre-feasibility study for a project on Nghi Son EZ’s waste water treatment with an investment of US$102 million.
HCM City plans US$652-million elevated road to ease traffic congestion
Ho Chi Minh City’s municipal government is seeking permission from the central government to build an elevated road to help reduce traffic congestion.
Road Number 1 will run for 9.5km with total investment of about VND15 trillion (US$652 million), local media reported on December 8.
The four-lane road is expected to begin at Lang Cha Ca Roundabout in Tan Binh District near Tan Son Nhat International Airport and end at Phu An Bridge in Binh Thanh District.
It will serve as the backbone for a future elevated road system.
It will also act as a link from the downtown to belt roads around the city, alleviating the rising transport pressure on the country’s economic hub.
Ho Chi Minh City also has plans to build four other elevated roads with a combined length of more than 70km.
Construction of the city's first metro line linking Ben Thanh Market and Suoi Tien Theme Park started in December 2013 in District 9.
Plans for more metro lines are underway.
State asset panel said to be a must
Deputy PM Vuong Dinh Hue is pushing for establishment of a committee under the Government to manage an estimated VND5 quadrillion (US$223 billion) worth of capital at State-owned enterprises (SOEs).
Hue at a meeting with ministries on December 7 asked the Ministry of Planning and Investment, which was in charge of drafting a decree on establishment of the committee, to clarify three points.
These are the necessity of a committee specialising in managing State capital at enterprises, overview and forecast of SOE restructuring by and after 2020 and State ownership performance.
The establishment of the committee was necessary to remove conflicts among State functions by separating State ownership performance from policy making and market regulation.
Accordingly, ministries and people’s committees would no longer have the function of representing State ownership at SOEs.
Hue said that the VND5 quadrillion committee would help improve the ministries’ management of State capital.
“The management of State capital would be centralised,” Hue said.
State capital was currently managed by ministries, people’s committees and the State Capital Investment Corporation (SCIC).
Hue urged the planning and investment ministry to clarify responsibilities of the committee, which including consulting the Government on State ownership and supervising the use of State capital.
Deputy Minister of Planning and Investment Dang Huy Dong said at the conference the draft would be completed next week to be submitted to the Government for comments.
Under the draft, the committee would soon directly manage State capital at 30 SOEs in various areas, such as electricity, oil and gas, aviation, maritime and telecommunications.
The 30 companies reportedly accounted for more than 80% of the total value of State capital and assets.
False rumors rally Vietnam’s gold, dollar markets despite gov’t denial
Rumors surrounding the replacement of the current Vietnamese currency have continued to put adverse impacts on the domestic dollar and gold markets, despite repeated warnings from state agencies against the unfounded information.
The currency replacement rumor has sent dollar prices skyrocketing, especially on the unofficial market, since the beginning of the month.
The greenback on the ‘black’ market reached a record VND23,000 a dollar on December 3 as the rumor mill went into overdrive.
Accordingly, rising dollar prices sent gold prices in Vietnam through the roof, with some traders taking advantage of the rumors to manipulate the rates.
The market manipulation widened the gap between Vietnamese and global gold prices, as well as the margin between asking and selling quotes at local gold shops.
On the global market, gold closed at $1,171.1 an ounce on Wednesday, or VND32.08 million (US$1,432) a tael (37.5 grams), while Vietnamese gold shops quoted the precious metal at VND36.45 million ($1,627) a tael, a price gap of VND4.37 million ($195) a tael.
Vietnam’s gold prices move in reverse direction from global peers, fretting local buyers.
“I have no idea why prices in Vietnam rose by VND400,000 [$17.86] a tael while global rates are falling,” Chinh, a resident in Ho Chi Minh City, told Tuoi Tre (Youth) newspaper.
The woman is sitting on hot bricks, having borrowed loans in gold when price was only VND34 million ($1,518) a tael.
Gold has lost $167 an ounce, or VND4.58 million ($204) a tael, on the global market since last month, but prices keep fluctuating strongly in Vietnam, with the false currency replacement largely to blame, according to industry insiders.
“The rumors first rallied the dollar market, and the gold market was affected in the same manner,” Nguyen Thi Cuc, deputy general director of PNJ, a major gold trader, explained.
Nguyen Thanh Long, chairman of the Vietnam Gold Traders Association, said many gold shops have taken advantage of the rallied market to boost prices even further.
While SJC, the country’s largest gold trader, set the gap between ask and bid prices at only VND400,000 a tael at December 7’s closing session, the difference was VND500,000 a tael at gold shops.
The State Bank of Vietnam quashed the groundless rumors in a public warning earlier this month, and Prime Minister Nguyen Xuan Phuc reiterated the denial at a government conference on Tuesday.
The premier reassured that the government is totally capable of stabilizing the foreign exchange rate and the macro-economy, without forgetting to task relevant agencies with tracing the rumor makers.
On December 7, the foreign exchange agency under the State Bank of Vietnam also reiterated that the central bank is closely watching the dollar and gold markets and will have timely intervention if necessary.
“The public should not believe rumors and remain cautious about any decision to sell or buy,” the agency head Nguyen Ngoc Canh warned.