BUSINESS IN BRIEF 25/9 EVN seeks special mechanism for privatised Gencos Electricity of Viet Nam (EVN) has asked the Prime Minister to issue a special operation mechanism for three Power Generation Corporations (Gencos) before they are privatised, local media reported yesterday. However, details in the proposal and the mechanism have not yet been clarified. The Gencos were founded to comply with the national plan, which took effect in 2012 and aims to develop a competitive power generation market in the country. The companies have to produce electrical power, manage the production line and develop new power projects in order to have a strong financial condition before the privatisation. However, EVN reported that the privatisation of the three Gencos could be hard because they seemed unattractive to investors due to the inability to call for investments in their projects. The Genco headquarters were located in areas that are far from the country's central cities such as Ha Noi and HCM City, and they also had difficulties running and managing their sub-units located in various areas in the country, EVN added. In addition, the Gencos had difficulties in communicating with their agencies, as well as domestic and foreign financial institutions, and in recruiting high-quality human resources. EVN recently sold its entire stakes in the Central Area Electrical Mechanical Company (CEMC) – more than one million shares – and collected VND37.9 billion (US$1.68 million) earlier this month. According to the restructuring plan for EVN in 2012-2015, EVN has to reduce its stakes in seven companies that operate in other sectors. EVN divested from three of the companies – also real estate firms - by the end of last year, including Viet Nam Power Construction Investment JSC, Saigon Vina Real Estate JSC and Central Area Power Real Estate JSC. In four other companies, EVN reduced its stakes in four subsidiaries including the Global Insurance JSC (GIC) and EVN Finance JSC (EVNFinance). By the end of last month, EVN had sold one million shares in GIC to the insurance ERGO International, a sub-unit of Germany-based insurance ERGO Group, reducing its ownership in GIC from 22.5 per cent to 20 per cent. EVN will sell its remaining stakes in GIC at an auction once the State Securities Commission and the Ministry of Industry and Trade approve the plan. In EVNFinance, EVN has sold 58.75 million shares in EVNFinance to cut its ownership from 40 per cent to 16.5 per cent. At the moment, EVN plans to sell investors 3.75 million shares in EVNFinance to cut the stake to 15 per cent. By the end of August, EVN has earned VND958.3 billion ($42.6 million) by divesting from its sub-units that operate in non-power sector. Experts discuss two-way investing Domestic and foreign experts gathered at a workshop in Ha Noi on Tuesday to discuss establishing venture investment funds by the private sector in co-ordination with the State. The workshop was co-hosted by the Ministry of Science and Technology and the Viet Nam-Finland Innovation Partnership Programme. Deputy Minister Tran Quoc Khanh said that the issue is new and complicated in Viet Nam as there are still differing opinions on using State budgets for venture investment funds as well as policies to encourage the private sector to set up the funds to develop new and advanced technologies. Ta Doan Trinh, head of the National Institute for Science and Technology Policy and Strategy Studies, delivered a report on his research results. This clarified the short comings and challenges facing Viet Nam in encouraging the private sector to develop venture investment funds. Mikko Seppala, an expert from Finland, shared his experiences on this issue focusing on who should participate in the funds and how to manage and generate capital for them. He said there was a need to pay attention to innovative ideas during the policy design process as innovative ideas will decide the efficiency of venture investment funds. The majority of private equity and venture capital funds headquartered in Viet Nam are investment firms, such as Mekong Capital, VinaCapital, Dragon Capital, and CyberAgent Ventures, in addition to Inc, SBI Holdings and Golden Gate Ventures. As a big investment company of Japan, CyberAgent Ventures plans to increase investment capital in the Southeast Asian region from US$20 million to $50 million this year. Entering Viet Nam in 2008, CyberAgent Ventures has invested in 15 companies such as Foody, Tiki, Vatgia, Baokim and Web-sosanh with an average capital disbursement of between $700,000 and $1 million per company. The Ministry of Science and Technology said a national venture fund is expected to be established by the end of this year. State Bank draft overhauls lending The State Bank of Viet Nam has released a draft circular regulating consumer credit activities of financial companies to better manage lending as well as benefit domestic consumers. Under the draft, commercial banks are required to establish financial companies if they want to venture into consumer lending. Currently, commercial banks can provide loans to consumers, which is considered to be a high-risk venture. Since consumer lending was managed separately from other lending services of commercial banks, the central bank expected it would help the consumer lending market to develop more transparency, and develop in a healthy and effective manner, in accordance with international rules. Specialising in consumer lending will help commercial banks better enhance risk supervision and management, it said. Besides, banking expert Huynh Trung Minh said the growing number of finance companies would help reduce interest rates on consumer loans and improve the service quality of lending. Commercial banks also said that the transfer of consumer lending from commercial banks to financial companies would help the banks a lot as they could exploit thoroughly the potential retail market, diversify services as well as improve its risk management. Senior finance expert Can Van Luc told the Dau tu (Vietnam Investment Review) newspaper that consumer lending accounted for just 6 per cent of the total outstanding loans in Viet Nam. Meanwhile, this rate was 15 to 20 per cent in many other countries, and as high as 35 to 40 per cent in the United States market. The merger and acquisition (M&A) with banks, will also help financial companies as they can benefit from capital mobilisation of banks and the market share as well as all their technology, infrastructure and human resources. Experts said the move for M&As between banks and financial companies, or establishment of new financial companies, would become a major trend this year to help banks meet the SBV's regulations and boost consumer lending. In the first half of this year, Techcombank, Maritime Bank and VP Bank bought Viet Nam Chemical Finance JSC (VCFC), Textile Finance JSC (TFC) and Viet Nam Coal and Mineral Industries Financial Company, respectively, while the HCM City Housing Development Joint Stock Bank (HDBank) and the Japanese Credit Saison Company Ltd also formed the HD Saison Finance. Many other banks such as Vietinbank, BIDV, and Vietcombank, along with Sacombank and ACB are also planning to set up financial companies or acquiring financial companies through M&As. Buy VN goods from Sunday Vietnamese Goods Week 2015 is set to kick-off on September 27 in Ha Noi, HCM City and Da Nang to increase awareness of Viet-namese goods as well as their competitiveness. Speaking at the press meeting held in Ha Noi yesterday, Deputy Minister of Industry and Trade Ho Thi Kim Thoa said the week has been one of solutions to support the plan of developing a local market link to the Vietnamese to give priority to the Vietnamese goods campaign. The plan targeted that 90 per cent of Vietnamese consumers and businesses should know about the campaign by 2015 and 70 per cent of Vietnamese goods could be competitive in rural and remote areas by 2020. It also targeted to ensure that all localities in the country organise supporting services to connect supply and demand of producers of Vietnamese goods. Thoa added that several contracts were signed after previous conferences connecting supply and demand. Vo Hong Son, director of the Viet Nam Industry and Trade Information Centre (VITIC) said the one-week programme would organise a roadshow, exhibition and conferences to unravel the difficulties of Vietnamese goods producers. Covering an area of over 6,000sq.m, the exhibition is expected to attract more than 500 booths from around 300 local groups, corporations and small and medium-sized enterprises (SMEs). The Vietnamese goods of garment and textile, leather shoes, and petroleum, in addition to building material, mechanic equipment, electronics, and food technology would be showcased at the event. Enterprises participating in the exhibition would be chosen from 63 firms with national trademark award in 2014. One hundred Vietnamese companies achieved outstanding products and services in 2014. Son said there would be no entry fee for SMEs, artists and trade villages attending the week. Big groups and corporations would have to pay a fee to join the event. People's Artist Le Khanh and actress-cum-entrepreneur Mai Thu Huyen would act as brand ambassadors to the programme. The programme would be broadcast live on VTV on October 4. AEC’s impacts on Hanoi development scrutinised A series of measures was debated at a workshop in Hanoi on September 22 to help the capital make the best of opportunities and take most effective adaptation to challenges that will be generated after the ASEAN Economic Community (AEC) is formed by the year-end. The workshop is part of efforts made by the municipal authorities aiming to raise public awareness of the regional community and its impacts on the city’s socio-economic development. Speaking at the event, Vice Chairman of the municipal People’s Committee Nguyen Ngoc Tuan said Hanoi should assert its role as a pioneer in promoting economic growth nationwide, contributing to the country’s sustainable development target. He said the municipal authorities will direct relevant sectors to design appropriate policies and solutions as well, in order to make the best preparation for its joining in the AEC. Nguyen Thanh Cong, Deputy Director of the Hanoi Institute for Socio-Economic Development Studies stressed the need to create connection between Hanoi and other localities, especially those in the Red River Delta, thus promoting their integration in the time ahead. Sharing Cong’s view, Chairwoman of the Vinh Phuc Export-Import and Production JSC Nguyen Thi Lan Huong said Vietnamese enterprises will have a chance to assess themself as they take part in global markets, thus outlining suitable strategies for their development in the context of globalisation. Participants to the workshop focused their discussions on impacts of the AEC on Hanoi’s trade, services, investment, export-import activities and tourism, as well as the city’s socio-culture and urban development. Russia – 17th largest investor in Vietnam: conference Russia was the 17th largest investor in Vietnam as of late June with 107 projects worth nearly 2 billion USD, as heard at a September 23 press conference in Hanoi on bilateral economic and trade cooperation. Russian investors were active in 13 of Vietnam’s 21 economic sectors and in 24 cities and provinces nationwide, predominantly in processing and engineering with 35 projects. The two nations have facilitated trade promotion via visits, fairs and exhibitions. From 2012-2014, bilateral economic and trade engagements thrived in diversified forms, acting Head of the Ministry of Industry and Trade’s Department for European Market Duong Hoang Minh told the conference. In the foreseeable future, Vietnam and Russia will continue stepping up projects in the light industry, energy and mining while facilitating more business forums and exhibitions to bring high-quality Vietnamese goods to Russia. Chief Representative of the Russian Trade Office in Vietnam Maxim Golikov said Vietnam is a major partner of Russia among the Southeast Asian nations. Last year, Vietnam was Russia’s third largest ASEAN trade partner, making up 26 percent of the total ASEAN exports to the Eurasian nation. In the first half of this year, Vietnam’s trade surplus with Russia topped 120 million USD. Golikov added that Russia plans to increase its financial assistance for strategic partners, including Vietnam. Large-scale Russian projects in Vietnam are currently run by Power Machines, Rosatom, Rosneft, Zarubezhneft and Inter RAO, among others. Apart from oil and gas, nuclear and thermo-power energy cooperation, the two countries are due to strengthen collaboration across the automobile, aviation, machinery, foodstuff, aquaculture, and apparel and footwear sectors. Russian firms have also assisted Vietnam in personnel training, education, science, healthcare, sports and humanitarian activities through private or public-private partnership models. According to the Federal Customs Service of Russia, trade between the two nations last year surpassed 3.74 billion USD, up 94 percent from 2013. During the year, Russia mostly imported machinery (47 percent), apparel and footwear (25 percent), foodstuff and farm produce materials from Vietnam and exported machinery (65 percent), metal and metal products, fertiliser and oil and gas. Office rentals in Hanoi offer more choices Office rent prices in Hanoi are currently decreasing by 10-20 percent, while more suitable renting options are available for tenants, according to Greg Ohan, Director of the office leasing services section of CBRE Vietnam – a subsidiary of the world’s largest commercial real estate services and investment firm. In order to attract tenants, office buildings have tried to modernise their facilities, including clean water filter systems, automatic car parking and toilets with five-star hotel standards. Several buildings also arranged spaces for yoga and gym courses in addition to banking services and cafeterias. CBRE reported a trend of companies operating in the same industry choosing the same area, citing an example that many pharmaceutical companies have relocated their offices to Dong Da and Ba Dinh districts with high-quality buildings and suitable prices. The central area remains an alternative for banks, investment funds, consultancy and law firms, and new foreign enterprises, said the foreign property consulting service provider . Meanwhile, enterprises operating in information technology and transport as well as businesses from the Republic of Korea have prioritised buildings in the western edge of the city, where office prices remain stable. According to CBRE’s survey, about 106,000 square metres of office will be added to the western area in the near future. Vietnamese goods awareness week in the pipeline A “Vietnamese goods awareness” week will take place concurrently in Hanoi, Da Nang and Ho Chi Minh City from September 27-October 4, offering handicraft and financially-struggling exhibitors free rent and advertising. During a press conference in Hanoi on September 23, Deputy Minister of Industry and Trade Ho Thi Kim Thoa said it is the only event offering comprehensive financial assistance to exhibitors in need while small and medium-sized enterprises are entitled to a 50-percent discount. The “Proud of Vietnamese goods” event is to raise public awareness and increase the competitiveness of Vietnamese goods. It also aims to protect consumers and honour manufacturers for their high-quality products. According to Director of the Vietnam Industry and Trade Information Centre (VITIC) Vu Hung Son, parades will be held in Hanoi and Ho Chi Minh City from September 25-October 1, followed by fairs and exhibitions from September 27-October 2, and a conference and seminar. The closing ceremony will be broadcast live on October 4. The event is being hosted by the VITIC. Room remains for tuna export growth Vietnam’s tuna exports have rapidly increased in recent years, and the country still holds potential for more growth in this area, according to industry insiders. Tuna exports have been the third biggest earner in Vietnam’s seafood industry with a value of 400 million USD in 2014, behind only tra fish and shrimp. However, according to experts, Vietnam would increase its tuna revenue if proper measures were implemented to boost fishing productivity and exports in the future. Nguyen Pham Thanh, Vice President of the Tuna Club under the Vietnam Association of Seafood Exporters and Producers (VASEP), said Vietnamese sea areas have the potential to yield 600,000 tonnes of tuna each year. Nguyen Dinh Hau, Head of the business division of the Khanh Hoa-based Sustainable Seafood Ltd., said Vietnam can only fish 16,000 tonnes out of the 21,000 tonnes of ocean tuna each year and 22,000 out of 45,000 tonnes of Katsuwonus pelamis tuna . According to Nguyen Viet Manh, Director of the Scientific & Technological and International Cooperation Department of the Directorate of Fisheries, if fishermen and enterprises increase their output to 100,000 tonnes per year, Vietnam would be capable of competing with the world’s top tuna exporters. According to Hau, central agencies and local governments should assist fishermen with new facilities and preservation techniques to meet the requirements of target export markets. It is necessary to balance the interests of the enterprises and fishermen to ensure the sustainable development of tuna fishing, said Hau. Vietnam’s tuna products can be found in 99 countries around the world, including choosy markets such as Japan, the US and the EU. Vietnam is the 10th biggest tuna exporter with 45.5 percent being processed products. The US alone accounts for 36 percent of the total exports. In the first eight months of 2015, tuna export values reached 300 million USD, of which processed products were worth 138 million USD. Vietnam’s tuna products are facing tough competition in markets without signed free trade agreements such as the EU and the US. Ministry seeks debts to boost tax collection The Ministry of Finance would speed up the collection of tax arrears in September as a part of the efforts to fulfil the budget collection goal amid plunging oil prices. The ministry said that this month tax departments planned to collect more than 50 percent of the total tax arrears from 600 companies whose names had been publicised under Document 9901/BTC-TCT on July 20. Checks would be conducted to continue to make public the names of companies with tax arrears, but this must be implemented with accuracy, the ministry said. Publicising the names of firms was considered a solution to increase tax collection. In Hanoi alone, the latest updates from the Department of Taxation showed that as of the end of August, 157 out of 268 companies in the city, whose names were made public during the past two months, paid more than 1.1 trillion VND (48.88 million USD) or 20 percent of their total tax arrears. An estimation by the Ministry of Finance revealed that in August tax arrears totalled 74 trillion VND (3.289 billion USD) throughout the country, double the acceptable level. The ministry also suggested measures to be implemented within this month in order to ensure budget collection, saying that low oil prices coupled with uncertainty in the financial markets would continue to affect the budget collection. Accordingly, there would be a close watch on the fluctuations in oil prices and the financial markets for timely measures to ensure balance in collection and spending. In addition, the tax and customs departments must enhance management and supervision to prevent tax frauds which cause losses to the Government's budget collection, the ministry said. In the first eight months of this year, the Government collected 618.14 trillion VND (27.47 billion USD), an increase of 7 percent over the same period last year. The collection in the eight-month period was equivalent to nearly 68 percent of the estimate for the full year. The Government's spending totalled 733.3 trillion VND (32.6 billion USD) in the period, bringing the budget deficit to more than 115 trillion VND (5.13 billion USD). 30,000 DWT wharf put into operation in Dong Nai A wharf capable of serving 30,000 DWT vessels was put into service at Go Dau Port in the southern province of Dong Nai on September 23 after one year of construction. The 187 billion VND (8.2 million USD) wharf, built by the Dong Nai Port JSC, accommodates a bridge measuring 250 metres in length and 22 metres in width. Included in the detailed plan on the seaport group No. 5 approved by the Prime Minister, the wharf will serve demands of businesses in the Go Dau Industrial Park and adjacent zones with a total capacity of nearly 4.4 million tonnes of cargos annually. The Vietnam Seaport Development Master Plan was approved in late 2009 with the aim of developing a nationwide seaport network that will ensure smooth flow of export and import goods. There are currently 39 seaports across the country, which are divided into six groups on the basis of their geographical locations. The estimated volume of goods transported annually via the system by 2015 is 500-600 million tonnes. The figure is expected to double by 2020 and stand at 2,100 million tonnes by 2030. Wary investors leave pulp industry alone Vietnam has yet to have a modern, large-scale pulp production chain, despite the approval of several projects, Vu Ngoc Bao, general secretary of the Vietnam Pulp and Paper Association told Vietnam Economic Times. Vietnam is the world's top exporter of wood chips, with exports of six million every year in recent year. Wood chips are used in pulp production, which could attract foreign investment. Investment in the paper and pulp industry requires huge expenditures for advanced technologies, and a long period to recoup the investment. As a result, investors have been reluctant to pour money into the industry because of strict regulations on environmental protection. Many large pulp and paper factory projects worth thousands of billion of dong have yet to be put into operation. Phuong Nam pulp production factory, invested in by Tracodi Company in 2006 with capital of VND4 trillion (US$177.78 million), for example, had to stop operating because of conflicts between the mill and farmers about prices, and frequent machinery breakdowns. China's Lee & Man Group's pulp production factory in Hau Giang Province, with investment capital of US$1.2 billion, was expected to have the biggest capacity in the country of 150,000 tonnes of pulp per year and 420,000 tonnes of paper. However, construction stopped as there had been no environmental feasibility study of the project. Last year, the chairman of Hau Giang People's Committee sent a document to restart the project and ensure construction by the end of this year. But it is not expected to begin by that time, according to industry insiders. The companies Tan Mai Paper, Dong Nai Paper and Binh An Paper, formerly the pride of the Vietnamese paper industry, have also faced problems. After equitisation, the businesses were merged, forming the Tan Mai Group Joint Stock Company, the largest of its kind in the country. The company invested US$3 million in building a paper production facility, but had to declare bankruptcy because of inefficient operations. Drink industry told to lift distribution to stay trading Domestic beverage companies were urged to improve their distribution system to protect their domestic market shares amid anticipated rising competition pressure associated with intensive international integration. As a part of their efforts to implement the task of strengthening connections in the supply chain of Vietnamese products for sustainability, the Ministry of Industry and Trade on September 23 held a conference to connect producers and trading companies in the beverage industry in Hanoi. According to Le Thi Viet Nga, deputy director of the ministry's Domestic Market Department, the domestic beverage industry was facing with the risk of narrowing production scales due to the rising competition from foreign rivals. Nga said the co-ordination between producers and trading companies would create significant impetus for the domestic beverage industry to expand at home market, cut costs and better serve consumers. Nga also urged beverage companies to apply advanced technologies in production to enhance the product quality for sustainable development. Le Hong Xanh, deputy director of Sabeco, said that many beer giants planned to expand in Viet Nam, and in comparison Vietnamese beverage companies would be less competitive and might risk losing in the domdestic market. According to the Vietnam Beer Alcohol Beverage Association, the growth rate of the domestic beverage industry was on a downward trend from 2012. Statistics showed that during 2008-11 period, the industry's growth rate averaged around 17 but slowed down to 6% in 2012 and 4% in 2014. Nguyen Van Viet, the association's president, said one of the causes was the competition from foreign rivals which was weighing down many domestic beverage companies, especially those involved in small-scale production. Many were dissolved or taken over by foreign rivals. The competition was anticipated to become fiercer when Vietnam joined FTAs which would cut duties on beverage products to zero. The association said that the supply chain from production to consumption would be an important solution for the domestic beverage industry. "The challenges need to be tackled through enhanced quality and technology renovation," Viet added. Tra fish loses its edge in Mexico Vietnamese exports of pangasius (sold as basa, tra and swai) to Mexico have plummeted as a result of fierce competition with Chinese tilapia, according to the Vietnam Association of Seafood Exporters and Producers (VASEP). The latest figures show that in the seven months leading up to August, the major market dipped 22% to US$45.4 million year-on-year. The price of tra fish hovered around US$1.90-2.50 per kilo. Tra fish used to dominate the market, VASEP said, however according to the International Trade Commission, Vietnam has dropped to the third largest fish supplier trailing China and Chile. In addition, other fish such as cod and Alaska pollock made headway in the Mexican market at the expense of Vietnam exports. Tropical fruit sees strong global demand Doors are opening for the country’s fruit exporters, said Director Phan Huy Thong of the National Agricultural Promotion Centre on September 22 at an agricultural forum in Tien Giang. Since early this year, exporters in the Mekong Delta region have shipped 160,000 metric tons of fruits to the US, Japan, Republic of Korea (RoK) and China, generating revenues estimated at US$1 billion. “The demand for fruit coming from tropical countries will account for nearly three-fourths of the global demand of 3.6 million metric tons,” Thong said, which provides an excellent opportunity for Vietnamese fruit to get a toehold in new markets. Thong cited the issuance of permits allowing for the import of rambutan, dragon fruit and longan into the US and mango and dragon fruit into the RoK, Australia and New Zealand as very promising. CCI advances in September: ANZ The ANZ-Roy Morgan Vietnam Consumer Confidence index (CCI) rose 1.6pts to 135.3pts in September, and is 0.3pts higher than a year ago. The small gain in September was driven by increased optimism about the country’s overall economic prospects in the next year and over the next five years. ANZ Chief Economist South Asia, ASEAN & Pacific, Glenn Maguire said Vietnam continues to find itself in the remarkable stead of being the only Asian economy not recording negative import and export growth. It is strongly bucking the regional trade recession. However, dynamics within the Vietnamese economy will clearly not be immune to a weaker global trade environment and the September confidence survey may contain the first hints of caution among local consumers. There is a very clear split between short term personal financial sentiment and the medium to longer term outlook for the economy. It is notable that fewer households currently feel better off, compared to a year ago, and expect to be better off in one year from now. However, at the same time that confidence in the personal financial assessment has been waning, confidence in the nation’s medium to longer term economic outlook has picked up rather strongly. The short term assessment on personal finances may have been eroded by policy decisions to weaken the Dong and widen its trading band in August, measures which will make imports more expensive for the average Vietnamese household.  However, over the medium term this is a prudent policy choice that will retain Vietnam’s export competitiveness and ensure continued insulation from the regional trade recession. “We think a sharp erosion in confidence in Vietnam is highly unlikely. Our expectation of resilience stems from Vietnamese trade performance in the coming months, thanks to strong FDI inflows in recent years,” Maguire said. Why Viet Nam rice needs branding Building a national brand name for Vietnamese rice that can give it prestige in the world market is an urgent requirement. Such was the takeaway from a Vietnamese rice seminar co-held by the Ministry of Agriculture and Rural Development (MARD) and Ministry of Science and Technology on Tuesday in Ha Noi. In the world rice market, competition from traditional competitors has become increasingly tough while new competitors - Cambodia, Myanmar and the United States – are on the rise. The Government recently approved a project to build a strong global brand name for rice by the year 2020. It is the first national branding project approved for an agricultural product and therefore serves as a pilot for other key agricultural products in the future. The project seeks to improve the image recognition of Vietnamese rice and expand its market share in the world. The national rice brand must find a way to communicate Viet Nam's history, culture and tradition to the world. Seminar attendees advised that the project strategy focus on two issues: identifying quality-conscious markets, such as the US, EU and Japan to export high-quality varieties; and retain traditional markets with medium-quality rice. The project developers said that the 2030 target is for 50 per cent of the nation's rice to export under Vietnamese brands. Vo Thanh Do, deputy head of MARD's Agricultural, Forestry and Fishery Product Department and Salt Production, told the seminar that creating a brand name for rice has already faced several difficulties. Although Vietnamese rice production achieved several export successes in recent years, the industry as a whole faces many challenges, said Do. The country's rice production is largely harvested on small-scale plots. More than 85 per cent of rice farming households work on less than 0.5 hectares of paddy, he said. The small-scale production means low productivity and quality, rice farming ideally requires two hectare plots. The sector has several rice varieties, but notably lacks high-quality rice varieties needed to boost export value. At present, Vietnamese rice has only penetrated low- and medium-level markets; high-quality strains accounted for a small share of the world market. Building up a brand name would redefine Vietnam's rice export value and expand its reach. Currently, there are 200 medium- and large-scale Vietnamese enterprises involved in global rice trading. "But," Do said, "Vietnamese rice in the world market now has not created an impression yet." Le Thanh Khiem, deputy general director of Tien Giang Food Company, one of the biggest rice exporters in the country, said Vietnamese rice faced difficulties in exports precisely because it lacks a brand name. Focusing on special rice varieties plays an important role in branding, Khiem said. "Thailand is a successful story for rice branding. It's because they focused on some outstanding varieties," Khiem said. "But, so far Viet Nam hasn't picked a few good varieties to focus on out of hundreds for a brand name," he said. "Most Vietnamese rice varieties became degraded in a short period of time. To successfully brand a Vietnamese rice, we should choose some good varieties and preserve the genes to ensure stability in rice production", he added. Khiem also pointed out another shortcoming, farmers mixed different kinds of rice. One alternative presented at the seminar, came from Cao Tuan Nam, president of Thap Muoi Clean Agricultural Development Company. He said his company was branding organic rice for export. At present, the biggest concern for rice export enterprises are high costs and cumbersome export procedures needed to build up brand names. Deep-sea fishing vessel launched The central city of Da Nang launched a deep-sea fishing vessel, as part of the government's VND3 trillion (US$140 million) low-interest rate loan to help deep-sea fishermen, in a ceremony yesterday. The ship, which is 23m long and 6.3m wide with an 820CV diesel engine for making deep-sea trips, made its first trip to the Hoang Sa (Paracels) and Truong Sa (Spratly) Archipelagos yesterday morning. The VND10-billion (US$476,000) vessel was built by the Da Nang-based Sea Technology Company (STECH) in three months, with 70 per cent of the cost being funded by the state budget. Deputy Director of the city's agriculture and rural development department Nguyen Do Tam said the ship was the first vessel of the city's programme to build new vessels and to improve the quality of fish hauls. He said three steel fishing vessels have been built in the city and would be launched later this year. The central city's People's Committee approved an eight-year, deep-sea fishing production project, worth VND1.1 trillion (US$52 million), for developing a fleet of 400 trawlers by 2020, with most of them being equipped with global positioning and fish-detection systems. The central city, which has 15,000sq.km of fishing grounds, has a fleet of 2,300 fishing boats, of which 699 are deep-sea trawlers. October 1 opening for Vincom in Hai Phong Vincom Le Thanh Tong, the first Vincom shopping mall in northern Hai Phong city, will officially open on October 1. Located in Le Thanh Tong Street in Ngo Quyen district the shopping mall combines a shopping area and entertainment facilities, featuring international brands in different sectors such as fashion, cosmetics, and interior furniture, among others. In addition to providing a range of choice in high-end, luxury products, Vincom Le Thanh Tong also meets daily shopping needs with the VinMart supermarket. On an area of 1,400 sq m Vinmart sells clean and safe food and thousands of consumer goods. Meanwhile, VinPro - an electronics and home appliances store - will bring a rich tech experience to shoppers. Its entertainment facilities include a Lotte Cinema cineplex, tiNiWorld for kids, and a food court gathering together famous names such as Golden Gate, King BBQ, Highlands, Fanny, Jollibee, and Dingtea, among others. Vincom Le Thanh Tong is located on an area of 48,000 sq m and also has shop houses and a residential area. EVN to divest from ABBank Electricity of Vietnam (EVN) has announced an intention to sell its own and EVN Hanoi’s shareholdings in An Binh Bank (ABBank). A total of 81,587,990 shares will be sold, of which EVN will sell 76,856,018 (16.02 per cent of ABBank) and EVN Hanoi 4,731,392. The starting price will be VND10,000 ($0.45) per share. An Binh Securities (ABS) will be the consultant and will conduct the auction. The registration and deposit deadline is October 12, with the auction to be held on the morning of October 14 at the office of ABS. Payments are to be made from October 15 to 4pm on October 21. Where necessary, deposits will be repaid from October 15 to October 21. ABBank’s current charter capital stands at VND4.8 trillion ($213.6 million). EVN is currently the bank’s largest domestic shareholder with its 16.02 per cent, while Malaysia’s Maybank is its largest shareholder, with 20 per cent. EVN previously held more than 102 million shares, or 21.2 per cent, but sold 25.2 million shares to Geleximco in December 2013. This is the final year of EVN’s restructuring process for the 2012-2015 period. It is completing divestments in the field of banking, finance and insurance, under a government direction to depart from non-core businesses. Transport Ministry speeds up progress of Long Thanh Airport project Minister of Transport Dinh La Thang on Monday chaired a meeting to speed up the progress of Long Thanh International Airport project in the southern province of Dong Nai. An artists’ impression of Long Thanh International Airport Project According to a report by investor Airports Corporation of Vietnam (ACV), the company has submitted the ministry a summary, and an estimate for the project’s feasibility study which is being verified by the Institute Construction Economics under the Ministry of Construction. Because Long Thanh is a huge project, construction might take up to 10 years for the first phase if following common process. Consequently, ACV has proposed to organize a competitive examination to choose the best designs for the airport’s terminal and air traffic control tower and contractors to make a technical study report. In case the designer and the contractor are different, the ministry should ask them to work together to ensure the project’s progress. The ministry should propose the Government to assign the People’s Committee of Dong Nai province to undertake site clearance, according to the report. At the meeting, Transport Minister Dinh La Thang instructed ACV to set up a management board of the project as per regulations and prepare fund for implementation. He tasked the ministry’s Transport Engineering Construction and Quality Management Bureau to take responsibility for the project’s progress, quality, order and procedures. The Civil Aviation Authority of Vietnam will assume responsibility for technical matters. The Public Private Partnership (PPP) Commission will cooperate with ACV to calculate which items could be constructed under PPP form. The National Assembly has passed Long Thanh project in Dong Nai province to reduce overloading for Tan Son Nhat International Airport in Ho Chi Minh City, whose expansion has been proved too costly and unfeasible. Plastic sector competitiveness low Domestic plastic products are less competitive than those made in other regional countries in terms of design and quality though Vietnam’s plastics sector has the second highest growth rate in the ASEAN region. Nguyen Thanh Binh, director of the VCCI Trade Information Center, told a seminar on the development of Vietnam’s plastic industry ahead of the formation of the ASEAN Economic Community in HCMC last week that the sector achieves annual average growth of 16-17% in 2010-2015 but the value of its products is low as many local firms are using outdated technology. Binh said Vietnamese plastic products have been exported to many markets but their designs are poor and their quality is low. While enterprises in Thailand and Malaysia have been able to turn out hi-tech plastic products, Vietnamese companies can make conventional products and this is one of the reasons for their low profit. Local plastics enterprises still use 70-80% old machines imported from China. Dinh The Hien, director of the Institute for Informatics Research and Applied Economics in HCMC, said more than 80% of domestic plastics firms are family-run businesses and their operation cost is high as they have not applied modern technology for production and corporate governance. Binh said when more free trade agreements between Vietnam and partners take effect and the ASEAN Economic Community is established, Vietnamese enterprises will have to face fiercer competition from regional rivals. When tariffs are cut and removed as a result of the FTAs, domestic firms will have the opportunity to export to more major markets like the European Union (EU) but it is not easy for them to overcome strict technical barriers in those markets. Renovation and investments in new technologies are among the solutions for them to improve competitiveness. To resolve the problem, Hien proposed developing an industrial park for plastics firms to help them set up a production chain, cement cooperation among them, and minimize production and transport costs. Experts said domestic plastics enterprises are strong in making items for packaging, it is important to develop supporting industries to facilitate their production and help them build strong cooperation with the agricultural sector so as to earn more profit. According to market research firm Ipsos, if local plastics firms do not quickly improve product quality, the sector would see growth falling to just over 10% in the 2015-2020 period. Thailand probes steel imports from Vietnam The Department of Foreign Trade (DFT) under the Thailand Ministry of Commerce has initiated a dumping investigation into color-coated steel sheets imported from Vietnam, the Vietnam Competition Authority said. The authority under the Ministry of Industry and Trade said earlier this month the DFT decided to launch the probe into the cold rolled steel sheets (plated or coated with an alloy of aluminum and hot dipped galvanized and painted) imported from Vietnam. Earlier, the Thai agency said it had got a dumping investigation request from the local firm NSW BlueScope Company for an alleged dumping margin of up to 89.58%. The DFT said it had seen signs of the steel product being dumped, causing injury for the domestic industry. The Vietnam Competition Authority said the DFT will send the complaint and questionnaires to the parties concerned. Other interested parties may write to the Thai agency asking for getting related information and documents and participation in the case. This is the third dumping probe launched by Thailand into products of Vietnam, with the previous two related to cold-rolled steel coil in 2012 and cold steel in 2015. Previously, the Malaysian Ministry of International Trade and Industry conducted a probe into color-coated steel sheets imports from Vietnam with an alleged dumping margin of 13.68%. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR