Chủ Nhật, 26 tháng 7, 2015

BUSINESS IN BRIEF 27/7


Viet Nam's stock market helps drive the economy
Viet Nam's stock market has actively contributed to the country's economic growth and it should continue to thrive to better serve the nation, said Prime Minister Nguyen Tan Dung.
The Prime Minister made his comments during the 15th anniversary celebration of the HCM Stock Exchange (HOSE), held by the Ministry of Finance on Saturday in HCM City.
He also noted that the country's stock market remains modest, compared to other regional markets.
The PM, therefore, asked related institutions to continue improving the legal framework, regulations and policies that assist a market economy, along with international practices to ensure the transparency and effectiveness of the stock market.
He also urged the speeding up of the project to restructure the stock market to diversify services and products and better act as an effective channel of medium and long term capital for the economy.
Further, equitisation of State-own enterprises should be promoted, while private companies are encouraged to participate in the process and the equitisation should be linked to their listing on the stock market, he said.
The PM noted that the stock market must operate according to market rules, by being open, transparent and safe for investors.
He stressed training, both by courses and practice, of the staff members working in the stock market, to ensure the sustainability of the market's growth while playing an important role in the development of the technical infrastructure, as well as the advanced technologies, to ensure the services and products meet international standards.
HCM Stock Exchange, formerly the HCM City securities trading center, the country's first exchange, was inaugurated on July 20, 2000 and its first trading session took place eight days later, with SACOM and REE as the first listed companies.
"By the end of June, there were 303 companies on the exchange's board, with a total market capitalisation of more than VND1,100 trillion (US$500.5 billion)," said Tran Dac Sinh, HOSE's chairman. He added that his exchange has 87 member securities companies, and 1.5 million investors have opened trading accounts.
Last year, daily transactions performed through HOSE were valued at more than VND2.1 trillion ($96.3 million), representing 77 per cent, or the combined figure of exchanges in HCM City and Ha Noi.
Apart from those 303 companies, there were exchange-traded funds (ETF) and 38 bond types issued by businesses, as well as municipal and provincial governments.
Sinh noted that listed companies double their chartered capital, on average, and in cases such as Vincom, the rate stands at 1,718 per cent and REE, 1,693 per cent. Trading was held for shares of 367 companies, which total VND70 trillion ($3.2 billion).
Apart from the Exchange Tower, HOSE is developing its data center in the city's Quang Trung Software Park, which is expected to be completed in the third quarter of 2015.
During the ceremony, HOSE was honored with a Labour Medal, First Grade by Prime Minister Nguyen Tan Dung.
Also, Minister of Finance Dinh Tien Dung awarded Certificates of Merit from the Prime Minister to seven members of the HCM Stock Exchange for their contributions to its growth.
Automatic weigh system activated on southern expressway
Vietnam Expressway Services Engineering Joint Stock Company (VEC-E) has activated an automatic vehicle weighing system on the HCMC-Long Thanh-Dau Giay Expressway to detect overloaded trucks.
The management unit of the southern expressway said the weigh system connecting toll stations at both ends of the expressway found hundreds of overloaded vehicles on the highway linking HCMC and Dong Nai province on Monday.
VEC-E said the system found 172 overloaded trucks out of 1,004 trucks it handled on the first day of its activation.
VEC-E said just warnings were sent to drivers of overloaded vehicles on the first day but violators will be stopped and forced to move out of the expressway on the coming days.
The system comprises four sensor bars installed under the road surface. When trucks run over the system, data about their loads will be analyzed. Cameras installed at the toll stations on the expressway capture the registered numbers for the system to check the permitted loads of these vehicles.
The automatic scale performs better than the current weigh bridges used by traffic authorities thanks to the underground sensor bars which ensure its function unaffected by temperatures, humidity and human interference.
Kantar Worldpanel: Beverages lead FMCG market in Q2


 Kantar Worldpanel: Beverages lead FMCG market in Q2, June CBU auto imports from China down, Shrimp exports forecast to drop this year, Rice exports year-to-date announced, Milk powder sales falling in cities


Beverages continued to take the lead in the fast-moving consumer goods (FMCG) market with a growth rate of 13% in April-June over the same period of 2014, according to a quarter two report of market research firm Kantar Worldpanel.
Carbonated soft drinks in big cities and instant coffee in rural areas were the fastest-growing categories as they attracted many more buyers. While carbonated soft drinks lured 78,000 incremental shoppers in urban areas, instant coffee gained ground by wooing an additional 450,000 shoppers in rural areas.
As for dairy products, the milk segment experienced a 2% decline in value in urban areas, driven by a slump in powdered milk prices but still posted the strongest growth rates of 14% in value and 13% in volume versus the same period last year, backed by growth in liquid milk and drinking yogurt.
In terms of retail landscape, street shops in urban areas lagged behind the market and FMCG sales at hypermarkets and supermarkets also tumbled. But specialty stores and mini-stores were the most outstanding performers in urban areas.
For rural areas, groceries kept growing and making up 77% of the market share.
The latest report of Kantar Worldpanel showed in the 12 weeks to June 30, in line with the regional downtrend, four key cities, Hanoi, Danang, HCMC and Can Tho, and rural Vietnam have continuously suffered from a deceleration in FMCG growth since early 2014.
However, there were positive signs in the short term as the value posted a 1.9% increase in urban areas and a 7.2% rise in rural areas.
In general, almost all sectors have recovered their growth momentum, except for packaged foods.
The firm’s annual Brand Footprint report revealed the top 10 FMCG manufacturers and the top 10 brands by sector (health & beauty, homecare, food and beverages) in Vietnam in the period.
The top three positions were the same last year in urban and rural areas, namely Unilever, Vinamilk and Masan. The top rising brands consisted of Dove, Fami, Diana, Milo, Aba, Coca-Cola and TH True Milk, among others.
Unilever led the ranking of the most chosen brand owners in rural areas. The global giant FMCG producer had its products chosen for more than 388 million times annually in rural Vietnam and shone brighter than any other brand owners with almost 100% market penetration.
Vinamilk was the most chosen brand owner for the third year in urban areas.
Masan won the second place in rural areas and third place in urban areas, mostly thanks to its widespread fish sauce brand Nam Ngu. The company also owns other powerful food and beverage brands including Wake-up Café Saigon and Kokomi, which has enjoyed impressive growth in rural areas.
Suntory PepsiCo gained two spots to take the sixth position in the urban ranking.
David Anjoubault, general manager of Kantar Worldpanel Vietnam, said both local and international enterprises were expanding into new territories. While local brands sustain better among lower income groups, high earners are heading more towards international brands.
The report revealed that focusing on penetration, the number of shoppers choosing a brand, was the key to build big brands. Therefore, it is essential for all players to explore new markets and develop their brands to meet the needs of local consumers.
In Vietnam, about 70% of FMCG categories have less than 50% penetration (on yearly basis). This implies every brand still has plenty of headroom for growth, Anjoubault said.
June CBU auto imports from China down
The volume of CBU autos imported from China into Vietnam in January-June fell 22.8% month-on-month to 3,522 units, according to the General Department of Customs.
The situation came in stark contrast to strong rises in CBU auto imports from China in previous months when local transport firms increased purchases of vehicles, particularly trucks from the northern neighbor, thanks to their lower prices than products imported from other markets, to meet demand for cargo transport and cope with stricter controls on overloaded trucks.
But the decline was a common trend for auto imports last month when Vietnam spent more than US$307 million importing 9,678 units, down 9.8% in volume and 6.1% in value compared to May, the local news sites VnExpress reports.
The Vietnam Automobile Manufacturers Association (VAMA) reported June auto sales of 18,686, rising by 4% month-on-month and 57% year-on-year. The volume included 14,448 units assembled in Vietnam and 4,238 imported CBU autos.
Auto imports in the first half soared in both volume and value. Figures of the department showed Vietnam imported 55,350 units worth US$1.51 billion, up 116.3% in volume and 178.8% in value over the same period of last year.
HCM City gets tough on canal contractors for slow compensation
Contractors of Tan Hoa-Lo Gom Canal rehabilitation project will be banned from taking part in future tenders in HCMC if they are unable to compensate households for causing their houses to crack or subside.
The city government has told the HCMC Urban Upgrade Project Authority to make a list of contractors slow in such compensation and bar those who have not completed compensation for the affected households near their construction sites by July 31 from joining tenders for future construction projects in the city.
According to the city government’s announcement, individuals or organizations causing bad consequences in the canal project execution process must use their own money to pay for compensation and the city will not cover this.
Le Thanh Liem, director of the HCMC Urban Upgrade Project Authority, reported to the city government earlier that when the canal rehabilitation project was finished in April, around 460 nearby households claimed their houses were affected by the project.
By early this month, more than 300 households had agreed to get compensation payments totaling VND22 billion (US$1 million) from contractors of the project.
The project to rehabilitate Tan Hoa-Lo Gom Canal and build roads along the canal has helped improve the living environment for nearly 1.5 million people in districts 6, 11 and Tan Phu.
Shrimp exports forecast to drop this year
The Vietnam Association of Seafood Exporters and Producers (Vasep) has estimated this year’s shrimp export revenue would total some US$3.2 billion this year, well below the US$3.9 billion recorded last year.
Truong Dinh Hoe, general secretary of Vasep, told the Daily that local shrimp exporters have coped with more challenges since last year, and that shrimp export turnover could drop by a hefty US$700 million this year.     
Nguyen Van Kich, general director of Cafatex Company in the Mekong Delta province of Hau Giang, shared Hoe’s view, saying shrimp exports would go down remarkably this year.
He said it is difficult to say exactly how much export revenue would decline but forecast that the fall would be somewhere between US$700 million and US$1 billion.
Vasep attributed lower export prices of shrimp to the export plunge this year, saying that prices have dipped in line with a pickup in competition with rivals like India, Thailand and Ecuador.
According to the General Department of Customs, Vietnam obtained shrimp exports of US$1.2 billion in the first half of this year, down 29% year-on-year. White-leg shrimp shipments accounted for US$741 million of the total, and tiger shrimp the remainder.    
Given the current situation, local exporters will find it hard to obtain shrimp exports of US$2.7 billion until December to make this year’s revenue equal to that of 2014.
Shrinking outbound sales of shrimp could send the country’s seafood export turnover down sharply as shrimp makes up around half of all seafood exports.
Tough shrimp exports have impacted prices of unprocessed shrimp in the country.
At present, tiger prawn in the Mekong Delta is sold at VND190,000-260,000 a kilo, the same as in the previous week, while prices of white-leg shrimp stand at VND85,000-95,000 a kilo, down by around VND1,000-2,000 against a week earlier.
Rice exports year-to-date announced
Accumulated rice exports from the beginning of the year to July 16 stood at 2.875 million tons, according to the Vietnam Food Association. Exports under Cost Insurance and Freight (CIF) were worth $1.231 billion, while Free On Board (FOB) exports were $1.194 billion.
The current price of raw rice made into 5 per cent broken rice is VND6,350 to VND6,450 (around $0.29) per kilogram, while raw rice made into 25 per cent broken rice is VND6,050 to VND6,150 (around $0.28). Prices may vary depending on quality and location.
The price of finished 5 per cent broken rice FOB is VND7,200 to VND7,300 (around $0.33) per kilogram, 15 per cent broken rice VND7,000 to VND7,100 (around $0.30), and 25 per cent broken rice VND6,800 to VND6,900 (around $0.36). These prices may also vary depending on quality and location.
According to figures from the Cultivation Department at the Ministry of Agriculture and Rural Development, as at July 16 cities and provinces in the Mekong Delta had sown 1.666 million ha in the summer - autumn crop compared to a target of 1.6 million ha. The harvest is estimated at 650,000 ha, with 5.4 to 5.5 tons per ha, producing around 3.54 million tons.
By June 11 Vietnam had exported 2.123 million tons of rice with a CIF value of $918.667 million.
Milk powder sales falling in cities
Urban areas remain important for milk powder producers but small cities and rural areas have significant potential, according to market researchers Nielsen.
In the 12-month period ending June 30, sales of milk powder reached approximately 14,700 tonnes in six key cities in Vietnam - Hanoi, Ho Chi Minh City, Hai Phong, Da Nang, Nha Trang, and Can Tho - a decline of 11 per cent compared to the previous 12-month period, according to a recent report from global market researchers Nielsen.
Under Nielsen’s definition, milk powder includes adult milk powder (Complete & Balance, Healthy Living, and Pregnancy) and baby milk powder (Starter, Follow-On, Growing Up and Specialty). Products for babies account for 70 per cent while products for adults accounted for the remainder, primarily targeted at pregnant women.
Its research also reveals that although Hanoi and Ho Chi Minh City are still the most important cities for milk powder sales, smaller cities and towns as well as rural areas are considered markets of potential. According to the General Statistics Office and Nielsen Vietnam, over 70 per cent of the population is located in small cities and towns and rural areas. Moreover, there are 3.6 million children under three years old living in small cities and towns and rural areas and about 2 million use milk powder. Meanwhile, these figures are 550,000 and 400,000 in Hanoi and Ho Chi Minh City combined. The number of milk powder retailers in small cities and towns and rural areas stands at 34,000, or four times higher than in Hanoi and Ho Chi Minh City.
Nielsen’s research into rural consumers found that their income has been improving and health is one of their key concerns. Indeed, the research found that rural parents have a particular desire to improve the lives of their children.
However, despite the overwhelming size of the prize, many foreign manufacturers have mainly invested their business in urban areas, with only domestic manufacturers fully expanding their scope into Vietnam’s secondary cities and rural areas. “Stores in rural areas tend to be smaller and more dispersed, with an average number of 33 products per store, nearly half of the 59 products per store in big cities,” Associate Director of Retail Measurement Services at Nielsen Vietnam, Mr. Le Huu Minh Quan, said.
Vina Kraft invests in new packaging technology
Agreements on providing professional engineering services and world class paper packaging production technology have been signed between the General Director of the Vina Kraft Paper Co. Mr. Sangchai Wiriyaumpaiwong and leading engineering companies.
The agreement is part of the VKPC PM2 project to expand the company’s paper packaging production capacity. After finishing new manufacturing lines, by the first quarter of 2017 the company will reach a total production capacity of 500,000 tons per year and retain its position as the largest paper packaging manufacturer in Vietnam.
Vina Kraft’s manufacturing lines will be supported by Voith IHI Paper Technology in environmentally-friendly stock preparation processes to ensure sustainability. A wastewater management system using world-class technology in anaerobic treatment will come from Kobelco Eco-Solutions. Engineering services, meanwhile, will be provided by China Haisum Engineering and a highly-effective cogeneration power plant from the Hangzhou Boiler Group will be installed.
Vina Kraft Paper, the largest paper packaging plant in the south of Vietnam, in Binh Duong province, is a joint venture between Siam Kraft Industry Co., SCG Packaging, the leading packaging manufacturer in Thailand, and the Rengo Co. from Japan. With machinery on an area of 380,000 sq m, Vina Kraft Paper can meet the increasing demand for paper packaging in Vietnam. As a result of its world-class manufacturing technology, its paper packaging products are suitable for numerous applications in several industries, such as food and beverages, consumer products, clothing, shoes, electrical appliances, and furniture.
HSBC Vietnam wins two awards from FinanceAsia
HSBC Vietnam has been declared Best Foreign Bank in Vietnam for the ninth time in ten years by FinanceAsia, one of Asia’s leading publications in finance and banking news and analysis.
For the first time the bank was also named Best Foreign Investment Bank. Vietnam was the only country in all of Asia-Pacific (excluding Hong Kong) to scoop two awards.
“We are delighted to be named Best Foreign Bank and Best Foreign Investment Bank by FinanceAsia,” said CEO of HSBC Vietnam, Mr. Pham Hong Hai.
He added that it is a remarkable tribute to the headway the bank has made in broadening its business and bringing the full spectrum of investment banking, commercial banking, and market solutions to clients in what remains a very challenging market.
“The award for Best Foreign Investment Bank is also a milestone achievement for us and one we have achieved by leveraging our peerless international connectivity that links clients and also HSBC teams across multiple markets globally,” Mr. Hai said.
FinanceAsia noted that in the last year HSBC had supported large infrastructure and power projects that have contributed to Vietnam’s development, such as a $931 million loan to PetroVietnam (for which it picked up the Best Deal in Vietnam 2014 award from Asset Triple A) and a $910 million power project deal for Electricity of Vietnam (for which it picked up Deal of the Year 2014 award from Trade Finance).
Banks must bolster customer service efforts
The State Bank of Vietnam organized a conference on July 21 regarding the reform of administrative procedures at domestic banks and improvements to customer service quality. Director General of the SBV Office, Mr. Le Thanh Tung, said the central bank and commercial banks have made great efforts already to reform administrative procedures with the extensive application of information communication technology (ICT) and customer service quality has also improved greatly.
Enterprises previously had to complete a number of administrative procedures to obtain a bank loan. Some required dozens of signatures with complex conditions but are now much simpler. Some loans, for example, can take just one and a half hours to be approved.
Deputy General Director of Vietcombank Nguyen Danh Luong proposed an extension to transaction times to resolve problems surrounding differences in time zones. Mr. Le Trung Thanh, Deputy General Director of BIDV, said the bank has simplified its procedures, cutting the number of documents required for a loan from 50 down to about 20. The introduction of internet banking and mobile banking has also helped customers and enterprises to complete transactions quickly.
Regarding cash services, some banks such as Kien Long Bank have designed a program for automated note listing, for greater convenience, while Eximbank has implemented fingerprint authentication at its counters instead of ID cards or passports. Banks such as Vietinbank, BIDV, Sacombank, An Binh and Vietbank, meanwhile, have established 24/7 customer service centers to receive and process feedback and complaints from customers.
Mr. Tung also spoke of problems involving customers complaining about ATM services, as the applicable charges and fees are not clear and service quality in some areas falls short of expectations. Procedures remain complicated and inflexible in this regard.
Deputy Governor of the SBV Dao Minh Tu asked that banks publicly announce their charges and interest rates and ensure information security in electronic transactions for customers. He also asked that banks address customer feedback and complaints quickly.
FLC Twin Towers to get underway shortly
The FLC Group plans to kick off construction of FLC Twin Towers, previously known as Cemaco Tower, at 265 Cau Giay Street in Hanoi’s Cau Giay district shortly, a month after it acquired the project.
According to Mr. Dang Tat Thang, Deputy Director Managing of FLC, the group is quickly completing all procedures to begin construction in early August. “Due to its favorable location, many investors and consumers have contacted to FLC to ask about the project’s construction progress as well as our plans for the sale of apartments,” Mr. Thang added.
After five years lying idle, the one-hectare project is now undergoing site clearance.
Under FLC’s plans, FLC Twin Towers will comprise twin towers, including a 50-storey residential tower and a 38-storey office tower, with apartments for sale on a total area of 66,484 sq m, office space for lease with a total floor area of 35,960 sq m, and a shopping mall on 25,000 sq m.
With total investment from FLC of VND5.2 trillion ($238.3 million), the project also includes other facilities to meet the needs of residents, including an international hospital, schools, indoor and outdoor swimming pools, and a green-space, among others.
The group is yet to reveal any information on apartment prices.
The FLC Group has attracted much attention in recent times after acquiring three real estate projects in Hanoi in 2014 and the early months of 2015, including two in Nam Tu Liem district and one in Ha Dong district.
It also became the owner and developer of the $260 million FLC Samson Beach and Golf Resort in the north-central province of Thanh Hoa and the $162 million Nhon Ly resort, villa and luxury entertainment complex in south-central Binh Dinh province.
Vietnam plans to end EVN monopoly in power market in 2016
Vietnam will have more electricity suppliers next year, giving local consumers a wide range of options instead of forcing them to buy from state-owned EVN, the sole supplier at the moment, an insider said.
Nguyen Anh Tuan, head of the Electricity Regulatory Authority of Vietnam, told Tuoi Tre newspaper on July 22 that Vietnam will launch a "competitive electricity market" next year.
EVN, as Electricity of Vietnam is often known, will no longer be the only unit buying from power plants and selling at prices set by the government, Tuan said.
He said the Ministry of Industry and Trade is devising a detailed plan for the new market, in which power plants can sell to buyers other than EVN or directly to big consumers such as industrial zones and factories.
“This will end the monopoly status of EVN.”
He said the market will allow the establishment of private power businesses that work as EVN – buying power from the market and selling it down to consumers.
“The sellers will try to reduce their prices and improve their payment services. People will have more choices,” Tuan said.
He said the prices will go up and down on supply and demand, but the government will set a cap.
EVN has been claiming losses to ask for price hikes every year, and it receives an approval from the government almost every time, including for the latest hike of 7.5% to VND1,622 (7.7 US cents) per kWh last March.
Its monopoly status has caused consumers to doubt these losses.
RoK leading food & beverage company to invest in Yen Phong IP
The Republic of Korea’s Ottogi Vietnam Co, Ltd has signed a contract to build a food & beverage plant in Yen Phong Industrial Park (IP) in the northern province of Bac Ninh.
Ottogi produces more than 2,000 food and drink products including instant noodles, cooking oil, tempura flour, canned food, Mayonnaise, Ketchup, vinegar and others.
Ottogi Vietnam is headquartered in My Phuoc 2 Industrial Park, Ben Cat district, the southern province of Binh Duong.
As scheduled, Ottogi Vietnam will begin building its plant on an area of 66,000 sq.m in Yen Phong IP with a total investment capital of US$10 million in the first quarter of next year. The plant is expected to be operational in the third quarter.
As the investor of Yen Phong IP, Viclacera Land has committed to providing the best infrastructure and services to facilitate investment and production activities in the IP.
Yen Phong IP has so far welcomed nearly 20 RoK investors including Samsung, Orion, Flexcom, Dongsin, Mobase, Dawo Vina, Hansol, and AK Chemtech. The IP is considered an ideal destination for RoK investors, especially those operating in the fields of food processing, electronics production and assembly, and hi-tech.
Import-export revenue hits US$171.67 billion
Vietnam’s total import-export revenue jumped 12.7% to US$171.69 billion from early this year to July 15, according to latest statistics released by the General Department of Vietnam Customs.
In the period, total exports were valued at US$83.85 billion, an increase of 8.9% against the corresponding period last year.
In terms of imports, the total value reached US$US$87.81 billion, up 16.5%.
In the first half of July alone, exports hit nearly US$6.22 billion, down 16.1% compared to the second half of June.
Major export products which witnessed decline were telephones and components (down US$400 million), computers, electronics products and components (down US$149 million), vegetables (down US$93 million), footwear (down US$73 million) and steel (down US$59 million).
Meanwhile imports during the first half of July rose 2.3% to US$7.16 billion compared to the second half of June.
The increase was attributed to rising in crude oil (up US$48 million), petroleum (up US$45 million), metal (US$42 million) and animal feed (up US$31 million).
Power tariffs to be reduced as prices rise
Power tariffs will be reduced from the current six levels to three or even one level in the future, Minister of Industry and Trade Vu Huy Hoang said.
Reports from the Electricity of Vietnam (EVN) showed that power consumption in the period from April to June posted over 10 percent year-on-year increase due to abnormally hot weather and drought, resulting in the rise of household electricity bills.
The new power selling tariffs which were applied since March 16, 2015, also attributed to the surge of 1.5 to 3 times in power bills.
Hoang said the power tariff calculation and the tariff levels have seen shortcomings. For a normal household, the electricity bill rising from 200,000 VND to 300,000 VND to more than 1 million VND a month, would be a considerable expense.
Sharing the ideas, Deputy Minister Hoang Quoc Vuong said according to the current power tariff structure, if a household consumed over 400kWh, the power tariff would be 1,000 VND a kWh higher than the average level. That was the reason why high power consumption in summer has sent electricity bills surging. The current power tariffs have several different levels which having more consumption that would result in a hike in the bills. However, this calculation has not convinced consumers.
With regard to power bills and data collection from electricity meters, a representative from the Electricity Regulatory Authority of Vietnam (ERAV) said they asked the EVN to check and supervise power supply. The power sector received around 2,500 to 3,000 comments from customers in a month, of which 200 to 300 comments were for power bills. After check-ups, customers would receive answers from the EVN.
Deputy Minister Vuong said the calculation that stipulates "more the consumption, more the payment" was not suitable as the current power tariffs had earned a profit for the company. The tariff hike, therefore, could not be blamed for encouraging consumers to adopt power saving measures.
He wanted the ERAV to study how they could reduce the number of power tariff levels as well as reduce the difference between levels.
Minister Hoang also asked relevant agencies to change the tariffs as they had not been reasonable in the current situation. He urged them to apply one level across all consumption levels in the future.
The ERAV said power tariffs would be shortened from the current six to three levels. This would make electricity consumption calculations less complicated, benefit customers and make it easier for the management agencies.
State-owned banks maintain ground in first 6 months
The Bank for Investment and Development of Vietnam (BIDV) and the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), two of the four state-owned banks in Vietnam, have reported positive financial results for the first half of 2015, confirming their leading positions in the market, according to a local newspaper.
The Thoi bao Kinh te Vietnam (Vietnam Economic Times) quoted BIDV Chairman Tran Bac Ha as saying that the bank remains one of the largest listed banks in the industry with total assets of around 730 trillion VND (33.46 billion USD), a surge of 25 percent against the same period last year and 14 percent from the beginning of 2015.
It saw a 31 percent lending growth and 33 percent deposit growth year-on-year to 535 trillion VND (24.52 billion USD) and 574 trillion VND (26.3 billion USD), respectively.
These expansions, 4-6 percent higher than the industry average, have helped BIDV grab 12.7 percent of the lending market shares and 11.59 percent of the deposit market shares, up 1.1 percent and 1.28 percent, respectively, from 2014.
The lender’s pre-tax profit exceeded 3 trillion VND (137.5 million USD) in the first six months of the year, up 25 percent annually, while its two subsidiaries, BIDV Insurance Corporation (BIC) and BIDV Securities Company (BSC), also posted pre-tax profit increases of 40 percent.
Both of the subsidiaries are seeking strategic investors to expand their business. Canada-based Fairfax Financial Holdings has purchased a 35 percent stake in the BIC this year.
Vietcombank has enjoyed strong growth in non-interest income during the same period. Its revenues in international and domestic card transactions rose by 17 percent and 50 percent annually, respectively, surpassing the yearly targets, said Vietcombank Chairman Nghiem Xuan Thanh.
Deposits at the bank hit 455.7 trillion VND (20.9 billion USD) while total loans were pegged at 345.1 trillion VND (15.8 billion USD), an annual increase of 7.67 percent and 17.56 percent, respectively.
The bank reported a bad debt rate of 2.43 percent of its total loans.
Tra fish exports to UK surge
Vietnamese tra fish exports to the UK have obtained a stable and high growth over the past three years and the country ranks fourth among importers of Vietnamese tra fish in the EU.
According to the Vietnam Association of Seafood Exporters and Producers (VASEP), by mid-June, tra fish exports to the EU had hit US$129.6 million, down 16.8% against the same period last year, however, exports to the UK still jumped 43%.
Particularly, the growth of tra fish export to the market hit a record of 97.8% for the first five months of this year.
Last year, the import price of tra and other pangasius fishes in the UK was around 2.4 Euro per kilogram – highest among 10 import markets: Spain (1.74 Euro), the Netherlands (2 Euro), Germany (2.3 Euro), Italy (1.7 Euro), and France (2.3 Euro)
Currently, frozen tra fish fillets accounts for 86% of total tra fish output imported to the UK and Vietnam is the sole supplier of tra fish fillets to the market.
Vietnamese Tra fish exports to the UK are expected to grow higher this year thanks to stable consumption demand and reasonable import prices.
More needs to be done towards AEC’s prosperity: Credit Suisse
More work needs to be done to ensure that the ASEAN Economic Community (AEC) integration that commences this year will actually bring about a stronger and more prosperous region, the Philippines’ Manila Times quoted a senior financial institution official.
At the Manila Times 2nd Business Forum on July 22, Jose Isidro Camacho, Credit Suisse Vice Chairman for Asia Pacific division, said that the real integration among ASEAN member nations has yet to fully materialise despite the long list of agreements reached since the bloc’s establishment in 1967.
He stressed that in spite of the removal of tariffs on almost all goods within the region, more work is needed on trade facilitation, uniform customs procedures and removal of non-tariff measures to truly realise a seamless production base.
He noted the integration should include elimination of visa requirements for inter-ASEAN travel to encourage greater interaction, understanding and awareness as tourism and investments are boosted, just like what is observed within the European Union.
In terms of goods, Camacho reiterated that the region is “almost there” with zero tariffs in almost all goods, although work still needs to be done on the non-tariff issues.
On services, he said there has been “very little progress” in the vision to provide services in air transport, healthcare, tourism and logistics.
There has been no progress as well in investments, and it may have even regressed in some economies, Camacho said, adding that not much has been accomplished on the capital side to have a more integrated capital market for the region.
As for skilled labor, Camacho said: “Given the various stages of economic development and different levels of education amongst ASEAN members, an expedited flow of skilled labor would have been helpful in deploying excess skills from one ASEAN economy to another. But instead, in recent times, we have seen even more restrictions on foreign labor in some of the ASEAN countries.”
But all of these problems may be addressed by starting with issuing an ASEAN visa to facilitate travel within the region for non-Asean individuals, as well as adopting the concept of ASEAN citizenship.
He said the issuance of an ASEAN visa will link trade, tourism and investments across all member countries, while accepting ASEAN citizenship can bring closer the economic proximity of each ASEAN member.
In the next few years, Camacho believes that ASEAN will continue its economic growth momentum due to a number of megatrends that are unlikely to reverse, including the fast pace of urbanisation within member countries, an improving ASEAN consumer base, the amount of infrastructure to be built, the rise of high net worth individuals in the region, ASEAN having rich resources which makes it a major supplier of commodities, and the emergence of ASEAN multinationals and brands.
The Association of Southeast Asian Nation (ASEAN) is an economic region with a 600 million population, generating a combined gross domestic product of about US$2.4 trillion, which is 5.5% of the world GDP. In the last five years, the region has been growing by 5.6% annually.
e-Regulations likely to improve business
The launch of an e-Regulations system is viewed by experts and users as a boost to Vietnam's business and investment environment.
The United Nations Conference on Trade and Development (UNCTAD) conceived e-Regulations as a tool to help governments make rules and procedures fully transparent and facilitate business, trade, and investment.
The Ministry of Planning and Investment's Foreign Investment Agency (FIA) launched the third phase of the e-Regulations system last month, and it is available at vietnam.eRegulations.org in English, Japanese and Chinese with step-by-step guidelines on investment procedures to help foreign investors in Vietnam.
There is a summary of each procedure, with points such as institutions involved, expected results, requirements, average duration, and legal justification. At each step investors can see the contact details of bureaucrats in charge, forms and requirements, costs, duration, and legal provisions.
FIA director Do Nhat Hoang said the system would ease difficulties for investors, enabling them to navigate Vietnam's investment procedures and processes and comfortably do business in the country.
Phan Khac Nghiem, a lawyer with Minh Long Law Office, told online newspaper Dau tu that the new system would make it convenient for investors, particularly foreign investors, to quickly search for information they need.
The e-Regulations does not only provide general information related to the establishment of businesses and amending investment certificates but also give specific information and a step-by-step description of investment processes and procedures in each participating locality, he said.
More specifically, investors can get information on rules and procedures through detailed, practical and up-to-date descriptions of the steps to follow at each industrial zone, he said.
Luu Quang Huy, who used to be Vietnam's commercial counsellor in Japan, told the newspaper that the system, available in various languages, would help investors from different countries find information.
Japanese investors, particularly small- and medium-sized businesses, prefer to use their own language because many of them are not proficient in English, he said.
Other experts praised the system for providing detailed information about each official in charge of investment procedures, saying pressure to improve the business and investment environment would now not only be on the Government but also on officials.
This pressure is expected to help change the behaviours of officials, they said.
Frank Gozel, a senior UNCTAD expert and a consultant for creating the e-Regulations, told the newspaper that the system would provide momentum for the seven participating localities in improving their business environment.
Investors can use the system to compare and choose the most favourable investment destination, he pointed out.
Claude Jentgen, Charge d'Affaires at the Luxembourg Embassy in Hanoi, was quoted by the newspaper as saying that his Government's target in supporting the programme was to speed up the process of making Viet Nam's business environment more open and transparent.
When investors know what should be done, who they should work with and where, it would be easier for them to make decisions related to their investment and business plans, he said.
Moreover, when the investment process becomes more transparent and open, it would help to prevent corruption and tackle bottlenecks in administrative procedures, he added.
Ngo Hai Phan, head of the Ministry of Justice's Department of Administrative Procedures Examination, said localities are willing to provide information for the system as well as receive feedbacks from investors.
This means local administrations really want to fix problems to improve their business environment, he said, adding that investors would surely benefit from this.
Partnership dialogue speeds up SoE restructuring, tax reform
The Ministry of Finance (MoF) and the World Bank (WB) on July 23 co-hosted a high-level dialogue meeting of the Public Finance Partnership Group (PFPG) in Hanoi with a focus on promoting PFPG activities in 2015-2016, restructuring state-owned enterprises (SOEs) and  reforming tax/custom procedures.
MoF Deputy Minister Truong Chi Trung said the conference helps Vietnamese agencies, international organisations and development partners better understand viewpoints and policies of each other regarding the above-mentioned fields.
Dang Quyet Tien, the MoF Finance Department Deputy Head told the conference 61 out of 289 SoEs have already been equitized and there is much more work to be done to equitize more than 200 others by the end of the year.
A representative from the Japan International Cooperation Agency (JICA) relayed that equitisation is an initial step in restructuring SOEs, however the bottom line must be to improve overall business governance capacities after the equitisation process is completed.
Aaron Batten from the Asian Development Bank (ADB) said that just around 8% of SoEs update their financial reports on websites, which means a serious lack of transparency, which makes very difficult to grasp business performance and post equitisation process.
Pham Minh Duc, a WB expert underlined the need to offer more favourable conditions for tax payers and intensifying tax reform grounded on tax institutions and management.
New decree vexes fertiliser firms
Many businesses involved in fertiliser production and trading complain that they face difficulties in obtaining a Certificate of Conformity for their products as required under Decree No 202/2013/ND-CP that took effect in February last year.
The certificate is aimed at ensuring a product is suitable for Vietnamese conditions and it does not affect the environment.
Vo Quoc Khanh, deputy director of the Thien Sinh Joint Stock Company, said the Ministry of Industry and Trade issued certificates for inorganic fertilisers and the Ministry of Agriculture and Rural Development for organic and other fertilisers.
The Thien Sinh Joint Stock Company produced a foliar NPK fertiliser that was tested by the latter's science council and sold for more than 20 years, but when the company registered for the certificate, both ministries refused to accept the application, saying the fertiliser was neither organic nor inorganic under the new regulation, he said.
Other businesses said they too faced the same situation.
Producers had no problem registering for inorganic fertilisers that came in single-nutrient formulas like phosphate, urea, and DAP because the Government had set national standards for them, they said.
But for foliar NPK fertilisers, they did not know where to apply since there was no national standard for this variety, they said.
With two ministries involved in managing fertilisers, businesses faced confusion and difficulty in obtaining the conformity certificate, they said.
Speaking at a recent meeting in HCM City, Nguyen Nhu Cuong, deputy head of the Crop Production Department, said there had been slow progress in issuing the certificates.
According to agriculture departments around the country, more than 2,000 organic and other fertilisers were available in the market, but only around 200 had the certificate, he said.
The Government had mandated that companies should, by next February, stop making products that did not have the certificate, he said.
Truong Hop Tac of the Crop Production Department said both offices receiving applications as well as companies often confused the conformity certificate with a quality certificate.
Fertiliser producers said some other stipulations in the decree also caused difficulties.
Nguyen Van Linh, general director of Humix Company, said the decree required technical workers and the management to be knowledgeable in the chemical, physical and biological fields and all the top managers to be at least university graduates.
Only a few fertiliser companies could meet these requirements, he said.
Tac said the department would report the industry's feedback to the ministry to explore ways to resolve the problems.
HCM City focuses on tourism growth
The HCM City tourism industry is increasingly offering new products and services based on what visitors want and how other countries do things.
The city, which has popular tourism destinations like the Cu Chi guerrilla war place tunnels, Ben Thanh Market, Reunification Palace, has developed new ones like inland waterway tours.
With the Sai Gon and Dong Nai rivers flowing through it and a 900km canal system, the city expects waterway tourism to spearhead the tourism growth.
Nguyen Van Dung, director of Thien Nien Ky Travel Company, said 99 per cent of international visitors to the city choose to visit Cu Chi District and 90 per cent choose to travel to the Mekong River for a day or two.
Tours that help visitors discover the city's history, culture, and food are also popular, he said.
In recent times around 10 travel companies have been offering a new product – seeing the city on a motorbike.
It takes tourists through Districts 1, 5, 8, and 7, enabling them to discover the differences in architecture, culture, and people's living style.
CNN International Edition recently carried a report on how to become a part of Sai Gon by Steve Mueller.
Mueller says: "Being on a scooter in HCM City is the best way to feel a part of the city. It's really an authentic experience. Being side by side with the locals."
La Quoc Khanh, deputy director of the city Department of Tourism, said the city has intensified its efforts to diversify tourism products and promotions like the ao dai festival in March, Tourism Day in April, Southern Food Festival in May, Southern fruit festival in June, and the HCM City International Tourism Exhibition in September.
It has also organised several promotional programmes in markets like Australia, Japan, South Korea, Russia, Eastern Europe, and Indonesia, he added.
These efforts partly explain why the city is regularly named in the list of interesting travel destinations.
It was listed as one of the world's 10 fastest-growing destinations between 2009 and 2015, according to MasterCard's annual Global Destinations Cities Index.
It was ranked 48th in a list of 50 safest cities in the world by the UK's The Economist magazine, which ranked cities around the world using 40 metrics that spanned four main categories: digital security, health security, infrastructure safety, and personal safety.
Nguyen Van My, the director of Lua Viet Tours Co, Ltd, said besides its geographical location, the city also has an advantage over other places like good infrastructure and friendliness and professionalism of service at shopping places and restaurants.
But the city has to fix some shortcomings if it wants to "fly high", he said, referring to unclean restrooms and toilets at tourist destinations, robberies, begging, and traffic jams.
"The city's tourism strategists have not come up with a specific strategy to make the sector outstanding.
"The simple thing they have to do is answer common questions visitors ask – what to eat? Where to go? What souvenir to buy?"
Speaking at a seminar on tourism products in 2015 in HCM City last month, Nguyen Viet Anh, head of the city Department of Tourism's travel division, said the insistence of hawkers is creating a bad impact among foreign tourists.
The People's Committee has tasked his department and other relevant agencies with resolving the problem.
"The department has worked with the police and district authorities to stop thieves, protect visitors at tourist destinations, and establish volunteer teams to assist tourists.
"The department is going to set up a tourism support centre, offering not only information, but also assisting tourists in case of robbery and loss of identity papers."
Lazada achieves milestone of more than 110 million visits in first half of 2015
Lazada Vietnam, a part of Lazada Group which operates Southeast Asia’s number one online shopping and selling destination, has reached the milestone of more than 110 million visits to its desktop and mobile sites in just the first six months of 2015.
This achievement reflects customers' trust in the shopping experience at lazada.vn, affirming its leading position in Vietnam’s e-commerce industry.
In addition, Lazada Vietnam has also hit other significant milestones. By continuing to focus on developing a marketplace platform that supports brands and merchants, the company has, in the first half of this year, signed up over 1,200 new seller partners who are supported by over 1,000 Lazada Vietnam employees.
Lazada has seen a surge in total mobile app downloads across the region, which has more than doubled from January to June 2015. The share of Gross Merchandise Value (GMV) from mobile by Lazada Vietnam was higher than 40 per cent in the second quarter of 2015 and is growing rapidly.
During Lazada Vietnam’s Big App Sale in May, the average number of downloads on sale days doubled in comparison with non-sale days in May. With this significant response amid the clear trend of mobile-first consumption in Vietnam, Lazada will launch another Big App Sale in August.
In its commitment to offer a wide assortment of local, international and exclusive products, Lazada Vietnam has partnered with brands including L’Oreal, Intel, Alcatel, Lenovo, Phillips, Bosch, Luminarc and Vichy.
Through these partnerships, Lazada has brought new exclusive products to Vietnamese customers, such as Vichy Idéalia skin serum, Lenovo A7000 smartphone, Alcatel Flash Plus smartphone.
These products gained significant traction with online customers upon introduction; for example, thousands of Lenovo and Alcatel phones were cleared within minutes in exclusive flash sales on Lazada.
Lazada Vietnam also works closely with many strategic partners from different industries from banking, telecom, transportation to education like HSBC, Vietinbank, Viettel, Vnpost, and RMIT University.
These partners help Lazada to strengthen services, enhance customer experience and reach out to more and more consumers.
One of the main challenges for e-commerce in general is gaining consumers’ trust.
To address this, Lazada has proactively taken a raft of initiatives with the ultimate goal is to increase customer satisfaction and trust.
For instance, efforts have been placed in developing a hotline to process with and investigate potential items infringing intellectual property rights.
It is now easier for customers to find trusted products on Lazada’s website as Lazada has launched a certification programme that issues a ‘trust-badge’ to all products coming from a certified seller.
Also, it will soon be possible for customers to chat with sellers, real-time. To increase transparency between sellers and buyers, Lazada will soon launch a chat functionality between both to ensure easier, faster and more personalised services.
These initiatives are being implemented and continuously evaluated for customer satisfaction.
“We are delighted to have seen such rapid growth in just the first six months of 2015, and we are looking forward to continued momentum in the second half of the year. Our focus will be to bolster our efforts in providing the highest level of customer protection, building further trust in online shopping, and enhancing the shopping experience for our customers,” said Alexandre Dardy, CEO of Lazada Vietnam.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR

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