BUSINESS IN BRIEF 29/11 Investors face bumpy ride but remain bullish on Vietnam Although Vietnam investors face a bumpy ride, Thai and many foreign investors remain sanguine about the economic prospects for growth and are continuing to develop long-range goals and pump billions of US dollars into the nation’s buildings, roads and other infrastructure. Deputy Secretary General, Board of Investment (BOI) Chokedee Kaewsang made the affirmation on November 27 at a seminar in Bangkok discussing opportunities and obstacles of investing in Vietnam. The Deputy Secretary General said the Thai Government has implemented a number of policies and procedures that complement each other to facilitate Thai businesses expand their operations into Vietnam. But it isn’t only Thai investors that are bullish on Vietnam. Foreign investors such as those from Taiwan, China, South Korea, Japan and Singapore are among the top investors in Vietnam and are grouping and realigning themselves in various supply chain configurations to get in on the action. This, of course, is directly leading to tougher competition. Most of the larger projects that are on the drawing boards are designed to improve the country's poor basic infrastructure, and these are obviously aimed at multinational corporations with huge financial resources and technical know-how. The big-league multinational corporations have all the advantages for these projects and smaller enterprises need not apply as they don’t have a chance to compete on any level. Therefore, to penetrate the Vietnamese market, Thai investors need to approach a project on a grand scale, Kaewsang said. In recent years, Vietnam has attached high importance to reforming laws and streamlining the process to obtain an investment license, which has expedited foreign investment in the country, Kaewsang added. For their part, Nguyen Ba Cuong, deputy director of the Foreign Investment Agency under the Ministry of Planning and Investment (MPI) and Nguyen Thanh Hai, trade counsellor of Vietnamese embassy in Thailand updated Thai businesses with useful information on Vietnam’s improved investment environment. They also spoke at length about the existing policies and laws on economics, trade and investment as well as advantageous fields in which Thai businesses will have opportunities to reap success in Vietnam. Cuong added that Vietnam and Thailand see bright prospects for cooperation in such fields as agriculture, food processing, and automobile. A number of leaders from Thai major businesses optimistically assessed the investment opportunities in Vietnam.  Chainan Nuphet, senior vice president of CP Vietnam Corporation said most of Thai businesses have reaped success when investing in Vietnam as the Government has provided active support to enterprises and created a healthy competitive opportunities for all enterprises. Associate Director at Siam Makro Plc, Jirawat Daechasatien confirmed the group would continue to invest in Vietnam as the seminar has provided him with useful information on investment opportunities in Vietnam and the recently approved amended Foreign Investment Law. Thailand now ranks 10th among nations investing in Vietnam with 371 projects capitalised at more than US$6.6 billion. Thai investors asserted Vietnam is a potential investment market of Thailand and they expressed hope that cooperation between the two nations would be further developed. Finland, Vietnam target US$1 billion in trade The packaging of exports may be more important than the products themselves, said Ms Siv Ahlberg, director of the Finnpartnership programme at a recent conference in Hanoi discussing an action plan to raise trade between Vietnam and Finland to US$1 billion over the next few years. Packaging effectively communicates to the target market details about the product, its expected shelf life, instructions for use and contact information for the business supplying the products, and it can make the pivotal difference to successful market entry. It carries information on the standards to which the product conforms and can push your product above the competitive landscape. Last year, the two-way trade turnover between Vietnam and Finland reached only US$228 million, which was far below its full potential and improper or substandard packaging may be one of the root causes, Ahlberg said. The Finn partnership programme has the aim of providing mentoring services, businesses planning, financial advice and solutions to identifying business partners to support feasible and commercially viable partnerships between Vietnam and Finnish businesses. Vietnam exporters shipped US$ 79 million worth of products to the Finnish market last year, while the nation’s imports from the market were nearly two-fold that figure at just US$150 million, according to the Vietnam Customs. In the nine months leading up to October of this year, the pace of exports to Finland picked up and almost equalled the whole of last year at US$75.5 million. Key exports in the nine month period were coffee, rubber, footwear, garments and textiles. Imports from Finland during the period principally comprised machinery, equipment, telecoms, plastics and materials. To more fully capitalise on opportunities for increased trade, Vietnam Customs has suggested both nations team up and work more closely together. Nguyen Tuan Hai, Finland export promotion project director said www.xuatkhauphanlan.com aimed at benefitting the Vietnamese business community in its efforts to elevate trade with Finland to US$1 billion. The VCCI project has also formulated plans to increase the number of delegations of local businesses travelling to Finland and Northern Europe to conduct comprehensive market analysis and study the tastes and preferences of local consumers. Hai recommended that Vietnamese enterprises carefully research the market and assess their products’ competitiveness. Vietnam should aim to promote its strengths in a number of products, such as frozen basa fish, tuna and shrimp. In Finland, the four largest food retail groups account for more than 90% of market share. They have strictly co-ordinated with wholesalers and trade centres and it is critically important for an exporter to the market to fully grasp and comply with their strict requirements. Echoing Sir Ahlberg’s view that effective packaging design is the key to maximising sales, Ha cautions local businesses to attach particular attention to it.  In the Finnish market, if the package design isn’t first rate, the product won’t sell. Other activities of the project have been aimed at making headway into the market by providing local enterprises with useful information, organising seminars and providing training programmes and promotional activities. Local businesses should also study and learn as much as they can about the laws of Finland and the North European nations, which generally provide preferences for high quality and environmentally friendly businesses that are socially responsible. Kimmo Lahdevirta, Finnish Ambassador to Vietnam expressed hope that the project will open up mutually beneficial expanded trade and investment among the business communities of both nations. Seafood exports to US up 19.3% in value Seafood exports in the eleven months leading up to December swelled 19.3% in value on-year to US$7.22 billion according to the most recent statistics of the Ministry of Agriculture and Rural Development (MARD). Exports to the US market also surged for the period by 19.97%on-year to US$1.43 billion, making it the largest importer of accounting for 21.85% of total export value. Other nations that saw high increases in seafood exports were the Republic of Korea (up 37.49%),China (up 16.17%) and Japan (up 8.47%). India and Taiwan were two leading seafood exporters of Vietnam, making up 34.2% and 7.1% of total value respectively. Japan links businesses in HCMC More than 30 Japanese and hundreds of Vietnamese small and medium sized enterprises gathered on November 27 in Ho Chi Minh City for a business matching event sponsored by the Japan External Trade Organization (JETRO). The purpose of the event was to establish business links between Vietnamese and Japanese enterprises operating in the housewares, wood products, interior furniture, cosmetics, and fashion fields. JETRO representative Daisuke Yamaguchi said the programme aimed to support Japanese small-and-medium enterprises to expand sales channels and bring high-quality products to the ASEAN region. ASEAN Caravan has been implemented by JETRO since 2012 with the purpose of introducing Japanese products to foreign countries exhibitions, trade links and market surveys. Over 700 businesses register to join online shopping day More than 700 businesses have so far registered to join the online shopping day which is scheduled for December 5 in Ho Chi Minh City. Organised by the Department of E-Commerce and Information Technology and the Vietnam E-Commerce Association (VECOM), the event aims to encourage businesses and consumers to shop online for the expansion of e-commerce market in Vietnam. Up to 44% of some 35 million Internet users in Vietnam have not experienced online shopping, according to the association The programme is expected to provide opportunities for both e-business community and consumers as most of businesses have yet to devise effective marketing strategies, said the organiser. In addition, more cooperation opportunities are expected to open for businesses in the fields of express service, banking, transport and telecommunication. It will also offer special discounts for a wide range of products such as electronics, cosmetics, and fashion items. Businesses should not worry about CPI reduction: Experts Businesses have worried that the sharp fall in November Consumer Price Index might be due to demand reduction, however Associate Professor Le Vu Nam from the Ho Chi Minh City University of Economics and Law has advised them not to worry and change their production plans. Vietnam’s CPI dropped 0.27 percent in November, the lowest reduction for the last several years and the second fall since March this year. The CPI reduction proved effectiveness of the Government’ efforts to curb inflation, stabilize macro economy, and ensure social welfares, Mr Nam said. According to statistics, the prices of main items in the basket of commodities used for CPI calculation sharply decreased in November. These items include food, catering services, housing, construction materials, electricity, water, petrol and gas. Of these, food and catering services fell only 0.03 percent over October while the group of housing, construction materials, electricity, water and fuel dropped as much as 0.74 percent over the previous month. Retail gas price has reduced VND40,000 a 12 kilogram cylinder since November 1 and petrol prices have continuously fallen, dragging down the prices of other goods and services and resulting in CPI reduction in the month. Therefore, Mr. Nam believed that the CPI reduction has not to show a sign of down purchasing power and will not much affect businesses. Therefore, businesses should not change the production plans in up coming months which is predicted as the busiest shopping time every year. They should take advantage of the reduction of interest rate, fuel price and transport fee to promote marketing and advertisement for their products, Mr.Nam concluded. Bio fuel consumption on the rise in HCMC The consumption of the traditional gasoline and ethanol blend E5 has been reported highly increase at several filling stations in Ho Chi Minh City ahead of a wide sale beginning December 1. Several filling stations' owners reported that they have prepared 4,000-5,000 liters of gasoline E5 a day recently instead of only 2,000 as they used to. Mr. Nguyen Minh Hai, manager of a filling station in Phan Huy Ich Street, Ward 14, Go Vap District, said that they sell about 15,000 liters of gasoline E5 a month, an increase of 2,000-3,000 liters over normal. From December 1 onwards, gasoline E5 will be widely sold at 58 filling stations in HCMC in accordance with the Government plan to market the blend in seven provinces and cities including Hanoi, Hai Phong, Da Nang, Can Tho, Quang Ngai and Ba Ria – Vung Tau. HCMC has proposed the Government to study tax and fee cuts to encourage businesses and residents to consume the bio fuel. Work starts on bonded warehouse at Cha Lo economic zone Work began on November 28 on a US$5 million bonded warehouse at the Cha Lo economic zone in the central province of Quang Binh, near the border with Laos. The project, financed by Australian logistics company Linfox, covers an area of 10,000 square metres, offering services such as goods transport, warehouse management, consultation and technical assistance. The bonded warehouse, designed to boost logistic support for the Vietnam-Laos goods transport route, is expected to generate an annual revenue of about US$4.7 million. The project is also expected to create an additional 100 jobs and contribute VND3 billion to the State budget each year. Industrial production surges 7.5% Viet Nam's index of industrial production (IIP) from January to November 2014 increased by 7.5 per cent year-on-year, according to the General Statistics Office (GSO). Significant industrial production growth measuring 11.1 per cent in November fuelled the index's positive rise in the first 11 months of the year. GSO experts said the processing and manufacturing sector, which made up 76 per cent of the country's total industrial output, had a tendency to increase towards the year-end. The sector achieved an encouraging month-on-month production growth of 11 per cent in November and a year-on-year increase of 8.6 per cent in 11 months. Several industrial products recorded high growth, including handsets at 60 per cent, automobiles at 28.3 per cent, steel at 24.2 per cent and leather and footwear at 20 per cent, as well as cloth at 15.8 per cent and electricity at 12.3 per cent. Other products, however, recorded lower growth such as crude oil at 1.7 per cent and coal at 0.4 per cent. Some products recorded industrial production declines such as motorcycles by 10 per cent, liquid petroleum gas by 7.6 per cent and powdered milk by 7.2 per cent. From January to November, the inventory index increased by 10.2 per cent year-on-year. Major industries showing higher levels of inventory included pharmaceuticals at 155.4 per cent, chemicals at 118.1 per cent, food processing at 96 per cent and metal production at 87.8 per cent. GSO experts predicted that the inventory index would likely fall next month because of an anticipated rise in domestic consumption. Property prices stable but buyers struggle Vietnamese people still find it hard to buy a house due to their very low salaries, even though the property prices are not high, said Nguyen Tran Nam, deputy minister of construction. "The housing prices have been relatively in conformity with the purchasing power. Viet Nam is not listed among the top 20 most expensive places to buy property in the world," Nam said at a conference on property trading held yesterday in Ha Noi, adding that the market has seen some recovery. The most important signal of the recovery has been the increasing number of real estate transactions over the past two years, especially in the small- and medium-sized apartment segment. In Ha Noi, around 10,000 real estate transactions made through trading floors were reported in the first 11 months of this year, double the same period last year. In HCM City, the number of successful transactions rose 35 per cent to reach 8,850 in the same period. Several real estate businesses have also started their construction or have offered properties for sale. Nam said that the property prices are stable or have fallen. In addition, the market's structure has been more suitable to home buyers' demands, keeping inventories low. As of November 20, the inventories in the market were worth VND77.8 trillion (US$3.7 billion), posting a 39 per cent year-on-year decrease. The property sector has received strong cash inflows. The debt balance in the market in the first three quarters of the year rose 12 per cent, while the total credit growth in the country was six per cent. However, the deputy minister said the country's real estate market is too young as property transactions began 10 years ago. "The market was young in terms of the management system, including policies and mechanisms to businesses and intermediate and home buyers," he added. The biggest shortcoming of the market was unplanned development, which did not follow a specific timeline. The product structure was also not suitable, as both the authorities and the investors had not studied the market supply and demand. The setting up of a long-term financial resource designed for the market has been considered as one solution to overcome the shortcomings. "A large part of the capital in the sector was from bank loans. Few businesses had more than VND1 trillion ($47.6 million) in capital, while bank loans were not stable," the minister noted. He proposed that the government should have proper policies for market development, while investors should take specific actions. Nam urged institutes and universities to conduct research on the market to provide guidelines to businesses and home buyers. Pirated sheets hurt VN steel firms Counterfeit and pirated steel sheets have flooded the domestic market and created a headache for the domestic steel industry. Le Phuoc Vu, chief executive officer of the Hoa Sen Steel Group, made this declaration at a seminar on trade fraud in Viet Nam's steel sheet market held here on Wednesday. The Vietnam Economic Times, Viet Nam Steel Association (VSA) and (VATAP) organised the seminar. Vu recalled a recent National Assembly meeting where Industry and Trade Minister Vu Huy Hoang answered questions of deputies on illegal trade. Hoang was quoted as saying the counterfeit sheets were often inferior and have made the public lose confidence in the genuine product. Vu revealed that in the first 10 months of 2014, his company lost productivity equivalent to 45,000 tonnes of sheet metal worth VND118 billion (US$5.7 million). He estimated total losses in the industry caused by copycat products to reach VND906 billion ($42.1 million). Le The Bao, VATAP chairman, explained that copycat steel sheets were often made using low-quality material from China. Domestic traders print well-known trademarks such as Ton Hoa Sen, Vnsteel Thang Long, Phuong Nam and Tisco on copycat products to deceive customers, he noted. Bao added that there was no ad hoc agency responsible for controlling the quality of steel production by household businesses. Nguyen Van Sua, VSA deputy chairman, said the counterfeit and pirated steel sheets were widely produced in the northern provinces, including Thanh Hoa, Bac Ninh, Bac Giang and Vinh Phuc, as well as Phu Tho, Thai Nguyen and Ha Noi. Nguyen Trong Tin, deputy head of the Market Surveillance Department, said in the first 10 months, his office detected and confiscated 10,000 tonnes of copycat steel sheets . In Ha Noi alone, it confiscated about 200 tonnes of copycat sheets. Vu acknowledged that his corporation was unable to compete with hundreds of copycat steel sheet producers everywhere. He said the fight against copycat steel sheets required concerted co-ordination among authorised agencies to solve the problem and ensure fair competition among domestic producers. Purchasing power up as Tet festival nears Viet Nam's total retail sales of goods and services in November increased by three per cent month-on-month and 12.2 per cent year-on-year to VND265.33 trillion (US$12.62 billion). Vu Manh Ha, domestic trade economist of the General Statistics Office (GSO), also revealed that rising shopping demand during months near the year-end and approaching the Tet (Lunar New Year) holiday led to the increase in people's purchasing power. In addition, the consumer price index (CPI) decline in November meant cheaper prices for several essential products and supermarkets' intensified retail promotional programmes that encouraged consumption. The 0.27-per cent CPI decline month-on-month was largely attributed to falling transport costs following petrol price cuts. In the first 11 months of 2014, total retail sales of goods and services reached VND2.67 quadrillion ($127.17 billion), an 11.1-per cent year-on-year increase, or 6.5 per cent if inflation is excluded. However, the increase in purchasing power for the 11-month period is still below expectations, as the increasing rate is only equivalent to half the rate of 2010. Ha explained that supply exceeded demand while incomes had not improved much, and businesses were still facing numerous difficulties. The Government's VND30-trillion ($1.4-billion) support package for the property market, a huge consumption market, had not been as effective as expected. Tourism sales in November likewise posted a three -per cent decrease. E-commerce agency backs online shopping Encouraging online shopping by Internet users in Viet Nam is necessary for rapid development of e-commerce in the country, experts say. Nguyen Thanh Hung, charmain of the Viet Nam E-commerce Association (Vecom), said on Wednesday that 44 per cent of the nearly 35 million internet users in Viet Nam have never shopped online. He was speaking at an online marketing conference that saw more than 700 enterprises register for the first-ever Online Shopping Day 2014. The Ministry of Industry and Trade's E-commerce and Information Technology Agency (Vecita) and Vecom are working together to encourage online shopping by individuals, enterprises and other organisations, he said. The HCM City conference is expected to open opportunities for both e-commerce enterprises and consumers in several fields including banking, express services, transportation and telecommunication. Online Friday will be the main event to be promoted at the event. It will be held this year on December 5, and on the first Friday of the last month thereafter. Consumers buying goods and services will be offered discounts, free shipping and other incentives. E-commerce revenues reached US$2.2 billion in 2013, a growth rate of 300 per cent over 2012. Online trade is expected to double next year, the conference heard. SBV dollar sale pledge helps exchange rate The US dollar and Vietnamese dong exchange rate eased further yesterday after the State Bank of Viet Nam (SBV) pledged to sell dollars. The Bank for Investment and Development of Viet Nam yesterday quoted the dollar at VND21,380 to VND21,400 while the Viet Nam Technological and Commercial Bank (Techcombank) yesterday quoted the dollar at VND21,350 to VND21,400, a 10 dong decline from the previous day for both banks. Asia Commercial Bank and Export and Import Commercial Bank also reduced their selling rates by VND35 to VND21,350 and their buying rates by 2 dong to VND21,398. Last Wednesday, SBV Deputy Governor Nguyen Thi Hong told news website VnExpress that to stabilise the forex market, the SBV had announced it would sell dollars to commercial banks and was consulting the banks on their demands, which would be readily met if necessary. The commercial banks' exchange rate had continuously fluctuated since early this month and hit the highest rate in five months at VND21,420 last November 19. Nguyen Thanh Toai, ACB deputy general director, said his bank had also asked the SBV for the dollar purchase, but he did not reveal the figures. Toai attributed the devaluation of the dollar against the dong to higher demands at year-end. However, he said, the dollar supply in the banking system could meet demand. Banks have almost met the dollar demands of export and import companies, provided that they complied with the necessary requirements, Toai added. Exporters and importers have also affirmed that commercial banks have met their dollar demands. Trinh Xuan Lam, director of the Tien Du Garment Export Company, said many banks have offered to buy dollars from his company. The SBV said the country's dollar supply and demand resources remained stable to date, with foreign exchange reserves of US$35 billion and a payment balance surplus of $11 billion. Irradiation firm plans to merge with rival Shareholders of An Phu Irradiation (APC) approved the company's merger plan with rival company Thai Son Company Ltd on Wednesday. At An Phu's shareholder meeting, four of five management board members and two-thirds of the supervisory board announced their resignations. Replacing them were five Thai Son executives. After SSI Asset Management and Transimex Saigon (TMS) divested, Thai Son bought the shares and is currently holding more than half of An Phu, said the listed irradiation company chairman, Vo Huu Hiep. As rivals, the competition with Thai Son made An Phu's product prices decline while costs kept on increasing, although An Phu accounted for the highest market share at 60 per cent. If An Phu is merged with Thai Son, the new company will take up to 70 per cent of the market and be able to control prices, Hiep noted. Meanwhile, demand for irradiation is rising, particularly from the seafood and fruit export sectors. Therefore, An Phu plans to work with Thai Son to build a new factory in northern Viet Nam to take advantage of these opportunities. APC had been sluggishly traded at about VND12,000 (US$0.56). However, the stock has been rising since late August. It closed yesterday at VND18,400 ($0.86). According to the latest financial report, An Phu's revenues reached VND44.3 billion ($2 million) and its net profits reached VND11 billion ($516,400) in the first half of 2014. Vietcraft launches design contest The Viet Nam Handicraft Exporters Association (Vietcraft) has launched a Sustainable Product Design Competition to encourage designers, artisans, companies and research institutes to develop designs that encourage the sustainability and diversity of the country's handicrafts. Participants can submit proposals in six product categories: home decoration and handicrafts, indoor and outdoor furniture, home textiles and embroidery, gifts and ethnic items, personal accessories and toys. The products of the winners will be promoted on national and international media, and at fairs both home and abroad. The deadline for proposals is January 31, 2015. Le Ba Ngoc, deputy chairman of Vietcraft, said handicraft companies in Viet Nam had largely failed to recognise the importance of design, sustainable products and the necessity for innovation. HCM City tops budget revenue forecast The city's budget collection reached VND231 trillion (US$10.8 billion) by November. This amounts to 102 per cent of the budget forecast. At a recent municipal meeting on the city's socio-economic situation, the city's service sector, with a strong growth rate of 10.9 per cent, was praised as a significant factor behind the budget haul. Foreign investment continues to be in the spotlight. In the past 11 months it brought in $2.9 billion. Meanwhile, the consumer price index (CPI) increased by only 2.02 per cent. City authorities told agencies and State-owned enterprises to increase promotional activities and ultilise advantages from trade agreements. Lotte opens store in coastal city The South Korean retailer Lotte Group opened a new store in the southern province of Ba Ria-Vung Tau yesterday, bringing the total number of its stores in Viet Nam to nine. Located on the corner of Thi Sach and 3/2 streets, Lotte Mart-Vung Tau has investment capital of US$29 million and covers an area of more than 30,000sq.m. It includes restaurants, fast-food shops, an entertainment area, cinema and supermarket. Lotte's eight other stores are located in HCM City, Dong Nai, Binh Duong, Binh Thuan, Da Nang and Ha Noi. The group plans to have 60 shopping centres nationwide by 2020. HCM City receives ASEAN Caravan The ASEAN Caravan, a business-matching event hosted by Japan External Trade Organisation (JETRO), arrived in HCM City yesterday with more than 30 Japanese small-and medium-sized enterprises (SMEs). Launched by JETRO in 2012, this is the first time the event has been held in Viet Nam. Participating Japanese companies mostly deal in home appliances, timber furniture, cosmetics and fashion. ASEAN Caravan aims to assist Japanese SMEs expand in Southeast Asia via business-matching, presentations at trade fairs and promotions via the internet in Singapore, Bangkok, Kuala Lumpur and Jakarta. Earlier this year, the ASEAN Caravan held events in Singapore on construction materials, and others in Bangkok on consumer goods and groceries. Google launches doodle contest The United States-based search giant Google Inc has launched the Doodle 4 Google competition for Vietnamese students aged between seven and 15. The competitors need to submit a doodle that shows their creative interpretation of the Google logo, while incorporating the contest's theme of "Draw Your Dreams," between today and January 26, 2015. More information about the competition can be found at http://www.google.com.vn/doodle4google/. The competition's organising board will give away bikes and certificates to 18 persons as consolation awards and their entries will be saved in the Google Doodle online library. The winning entry is expected to be displayed on the Google Vietnam homepage on March 6, 2015. Vietnam – one of most dynamic Asian economies: Italian analyst Italy’s financial news website Firstonline recently posted a story by analyst Ciro Caliandro giving his valuations on Vietnam’s economy as well as opportunities that Italian businesses can gain from their investments in the country. Ciro Caliandro wrote Vietnam has established itself as one of the most dynamic Asian economy with gross domestic product growth rate at 5.4 percent in 2013. He said the country is a leading player in regional integration in Asia-Pacific since it is now a member of the Association of Southeast Asian Nations (ASEAN), the ASEAN Free Trade Area (AFTA), and the Asia-Pacific Economic Cooperation (APEC) forum. Vietnam, deemed as a competitive country in Asia, received about 230 billion USD in foreign direct investment between 2000 and 2013, the story said, highlighting such advantages as good basic education, young workforce, low costs, and well-managed industrial parks. Ciro Caliandro said most of Italian businesses have so far invested in Vietnam’s energy (oil and gas), infrastructure building, machinery, and fashion industries. However, they could benefit from more incentives when pouring money into construction and housing sectors as the urbanization process in the country is happening fast. Italy currently ranks tenth among countries and territories exporting goods to Vietnam. In 2013, it shipped 674 million EUR (840.6 million USD) worth of commodities to Vietnam, and the figure is expected to reach 1.4 billion EUR in 2018. However, the European country is only the 20th largest importer of Vietnamese goods and services. The Southeast Asian country’s export revenue to Italy is forecast to grow at an average pace of 16 percent from 2014 to 2018, the analyst said. The story was posted on the occasion of a visit from November 23-26 by Italian Deputy Foreign Minister Benedetto della Vedova and 200 entrepreneurs to seek investment opportunities in Vietnam. Vietnam, South Africa promote trade, tourism partnership Vietnamese and South African businesses have explored cooperation opportunities in trade and tourism during a conference held in Hue city, the central province of Thua Thien-Hue on November 27. The event was co-orgnaised by the Vietnam Chamber of Commerce and Industry (VCCI) and the South African Embassy in Vietnam . South African Ambassador to Vietnam Kgomotso Ruth Magau said that South Africa , which boasts rich natural resources and modern infrastructure, is considered a gateway to Africa . It is emerging as a new attractive investment destination with friendly business environment, numerous preferential policies and accessible market. The conference offers a good chance for enterprises of both sides, especially those in Thua Thien Hue, to share information and seek partnerships, thus strengthening the relationship between the two nations, she added. Truong Thi Kim Anh, Deputy Director of the VCCI in Da Nang , said that since the two countries set up their diplomatic ties, South Africa has always been one of the promising trade and tourism partners of Vietnam . Vietnam can provides agricultural products, handicrafts, garments, construction materials and seafood to South Africa while buying metals, wood and cotton from this market, she said. However, he noted that the current two-way trade of about 1 billion USD is yet to match the two countries’ strengths and potential. Meanwhile, Vice Chairman of the Thua Thien-Hue People’s Committee Dinh Khac Dinh highlighted the prospect for collaboration between South Africa and Thua Thien-Hue, a cultural hub of Vietnam with the two UNESCO-recognised cultural heritages of Hue ancient capital and Hue royal court music. He said he hopes that through the conference, local tourism firms, associations and businesses will get more information about South Africa and its potential in order to further boost cooperation in the field.- Newly-ratified law allows foreigners’ property ownership Foreigners now feel secure to buy houses in Vietnam, Savills Vietnam Co., Ltd said on November 26, the day after the National Assembly adopted the amended Law on Housing, which allows foreigners and Vietnamese people residing abroad to hire and own real estate in Vietnam. Under the Law, foreigners will be entitled to own up to 30 percent of the apartments in a building, or 250 villas/ townhouses in a project. Moreover, the housing ownership certificate will be valid for 50 years. Statistics of Savills Vietnam show that overseas remittances to Vietnam in 2013 hit 11 billion USD, up 10 percent against the previous year. This is an abundant source to be poured into the real estate market once the law officially comes into force on July 1, 2015, said the firm. The amendment of the law will make Vietnam ’s real estate market more competitive and allow investors to gain better access to this attractive and potential market. The adoption of the law at a time when foreign investors are paying more attention to the local property market will help promote business activities and create a more competitive and healthier financial climate, said Savills Vietnam. According to the US-based property service provider CBRE Group, it is essential to simplify and concretise administrative procedures so as to create conditions for foreigners to rent and buy houses in Vietnam . The law will help increase the liquidity in the segment of high-end apartment in the coming time, said CBRE CEO in Hanoi Richard Leech, noting that it needs time to bring the law into life. Thai firms see potential in Vietnam’s market Vietnam is a promising market for Thai investors thanks to its favourable business climate, the Thailand Board of Investment (BOI) said. Addressing a workshop on trade and investment in Vietnam in Bangkok on November 27, BOI Vice Secretary General Chokedee Kaewsang called on Thai businesses to seize opportunities to do business with Vietnam as the country is adjusting its trade and investment policies. Vietnam is one of three top countries in foreign investment attraction in the Association of the Southeast Asian Countries (ASEAN) and the BOI has provided information on the market for all Thai businesses that are keen on investing in the country. Le Thanh Hai, Vietnamese trade representative in Thailand, said many Thai firms have operated successfully in Vietnam, hoping that Thai small- and medium-sized enterprises will pour investment in the country in the coming time. The event, held by the Commercial Affairs Office at the Vietnamese Embassy in Thailand in collaboration with the BOI, saw the participation of nearly 200 Thai companies. Two-way trade hit 7.6 billion USD in January-September, a year-on-year increase of 11 percent. As of October, Thailand ran 365 investment projects in Vietnam with the total registered capital of 6.63 billion USD. Meanwhile, Vietnam invested around 9 million USD in eight projects in Thailand. Mekong delta Tien Giang’s export turnover hit new record The export turnover of the Mekong Delta province of Tien Giang hit a new record high of 1.35 billion USD in the first 11 months of the year, marking a year-on-year surge of 40.8 percent. The figure has beaten the yearly target by 15.4 percent and even surpassed the target of 1.3 billion USD set for 2015. Director of the provincial Department of Trade and Industry Ngo Van Tuan said adopted investment incentives have reeled in a number of new businesses to key industrial zones, creating a wider range of products for export. Local material areas were also built up to ensure direct, stable supply for processors, including the zones for saltwater shrimp farming and high-quality rice paddy in Go Cong commune as well as the pineapple growing area in Tan Phuoc district. Domestic firms have accounted for 47.2 percent of the province’s total export earnings while foreign businesses made up the rest, Tuan reported. Sales of key export lines were on the rise during the period. Prominently, processed seafood hit 132,000 tonnes in volume and 290 million USD in value, up 8.5 percent and 13.4 percent, respectively. Meanwhile, a number of new products have made inroads into international markets. By the end of November, the province has shipped 6.9 million items of bags abroad for 215.8 million USD, a year-on-year surge of 90 percent in volume and 100 percent in value. Tien Giang is exporting commodities to 136 countries and territories worldwide. The locality forms part of the Mekong delta region, which produces over 50 percent of the total food output, and provides 90 percent of the country’s exported rice, 70 percent of exported fruits and 70 percent of exported seafood. Pakistan favours Vietnamese tea Vietnamese tea has become one of the top choices of consumers in Pakistan which boasts a population of nearly 200 million, according to the Vietnam Trade Office. Pakistan remains the largest tea importer of Vietnam, registering an average turnover of over 40 million USD per year and comprising over 20 percent of the Vietnamese total tea export volume. The Ministry of Industry and Trade has run a number of activities to help tea exporters make inroads into the market via online information exchanges and participation in trade fairs and workshops to promote Vietnamese tea brand name to international partners. Do Quang Huy, Director of the African and West and South Asian Market Department under the Ministry of Industry and Trade, cited insufficient market information as one of the major barriers that hinder Vietnamese firms from accessing Pakistani market. He called on tea businesses to forge closer links with farmers for the creation of high-quality products. Business players should learn information from official websites of the Ministry of Industry and Trade and Vietnamese trade offices and Vietnamese and foreign embassies. It is also necessary to make proper investment in human resources training such as foreign language, professional skills, and information on culture and custom, market and regulations. Preliminary statistics showed that Vietnam earned about 206 million USD from shipping 121,000 tonnes of tea abroad in January-November. Major importers of Pakistan , Taiwan , and Russia all registered growth over the same period last year. Ministry asks for more high-tech agricultural areas Vietnam will have more high-tech agricultural areas in all key economic zones nationwide in the time to come, the Vietnam Economic News reported. According to the Ministry of Agriculture and Rural Development, every province in the country’s key economic zones will have between 3 and 5 high-tech agricultural enterprises and about 2 or 3 high-tech agricultural areas. Enterprises involved in agricultural investment at local level will be given support in terms of high-tech applications, preferential land rent, loans, and market development, said the Vietnam Economic News. According to TH Group Chairwoman Thai Huong, majority of Vietnamese enterprises are small and medium-sized, and many of them are reluctant to invest in agriculture considering this as a high risk investment. If they do, they often involve in agricultural purchase, pre-processing, and distribution. Director of the Department of Science and Technology for Economic and Technical Branches, under the Ministry of Science and Technology, Nguyen Van Lieu said it was necessary to provide stronger support for agricultural companies such as soft loans, brand building and trade promotion while encouraging the development of domestic scientific research. According to General Director of Da Lat Flower Forest Biotechnology JSC Nguyen Dinh Son, an investment fund for high-tech agricultural enterprises should be established to help these enterprises invest in equipment and techniques. Farm produce prices expected to rise Local experts have projected that the prices of Vietnam’s farm produce such as rubber latex, coffee and pepper will increase in the coming time given an expected rise in demand of importers from China and other markets, the Saigon Times Daily reported. Last week, China’s central bank reduced the interest rate of one-year loans by 0.4 percentage point to 5.6% and this will enable more Chinese companies to take out loans to import rubber latex and other farm produce for stockpiling. An executive of an agricultural product trading firm based in Ho Chi Minh City told the Daily that the Chinese central bank’s interest rate cut will place a positive impact on the world’s farm produce market in the short term as the reduction is an opportunity for more Chinese firms to borrow money for goods and material imports. The executive said there are signs that Chinese companies have increased rubber latex imports for storage in Qingdao city in the east of China. Flooding in Thailand could affect the global supply of rubber latex and push up the price of this product worldwide in the coming time. “The price of rubber latex will likely pick up in the short term and the rise will depend on supply and demand,” the executive was quoted as saying. “As supply is higher than demand on the global market currently, the price is unlikely to rise sharply.” This week, a kilogramme of RSS3 rubber sheets is sold at 27,800 VND in southeast and Central Highlands provinces and the respective prices of SVR10 and SVR3L stay at 22,700 VND and 27,600 VND. These prices are the same to the levels over the weekend. On Japan’s commodity exchange Tocom, last weekend’s rubber price was quoted at the lowest level in the past seven weeks. The rubber price was around 190.5 yen per kilogramme (some 34,400 VND) for deliveries next month, up 0.2 yen, and 194 yen (around 35,000 VND) for deliveries in January. Higher demand has also lifted pepper prices on the domestic market. Traders on November 25 bought a kilogramme of pepper at around 194,000-200,000 VND, up 1,000-2,000 VND against the previous day. The average export price of pepper in the January-September period was 7,558 USD per tonne, rising by 14 percent year-on-year. Statistics of the Ministry of Agriculture and Rural Development showed that Vietnam shipped 145,000 tonnes of pepper worth over 1.1 billion USD in the first ten month of this year, up 18.5 percent in volume and over 35 percent in value year-on-year. According to the Vietnam Pepper Association (VPA), local farmers harvested around 150,000 tonnes of pepper in the 2013-2014 crop. Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR