BUSINESS IN BRIEF 25/4 Da Nang lags behind on FDI   The central city of Da Nang has failed to attract a significant amount of foreign direct investment (FDI) despite its top rankings in the Provincial Competitive Index (PCI) for the third consecutive year in 2015, local leaders said. In PCI 2015 - based on responses from 11,700 enterprises comprising 10,200 domestic private firms and 1,500 foreign invested enterprises in Viet Nam - the city was applauded by surveyed firms for its efforts in administrative reforms, especially in providing transparency, reducing transaction costs and being pro-active. Reports from the municipal Party Committee revealed that the city lured only US$44.3 million worth of FDI in 2015, ranking 33rd among 53 provinces and cities nationwide in terms of FDI. The sluggish influx of FDI into the locality was also seen in the past three months of this year. Only nine new foreign-invested projects worth $2.53 million were granted licences, while four operating ones were allowed to raise capital by more than $400,000. The city has a good investment environment and high competitiveness index, but investors are still not enthusiastic about investing there, online newspaper Infonet.vn quoted committee secretary Nguyen Xuan Anh as saying. Deputy Secretary of the committee Vo Cong Tri said the city's tax and land rental incentives were not on par with other localities. For example, land rentals in the city-based Hoa Khanh Industrial Zone reached an average of $1 per metre each year, higher than $0.8 recorded in the nearby Dien Nam-Dien Ngoc IZ in Quang Nam Province. A lack of cleared land has also brought the city challenges in drawing up a specific development plan for service logistics, as well as banking and finance sectors, he said, adding that ineffective investment promotion was also problematic. Vo Minh, director of the State Bank of Viet Nam's branch in Da Nang, said the city had to deal with three major issues if it wanted to attract large foreign investors. Those included an attractive investment policy, high-skilled personnel and an adequate support industry. Initially, the city should define the sectors that should provide more incentives, he noted. According to Anh, top priorities should be given to improving the city's investment climate, speeding up infrastructure development of the Da Nang Hi-Tech Park and facilitating the implementation of licensed projects, in addition to determining the withdrawal of investment licences for projects that failed to begin as scheduled. Hoa Sen opens pipe factory in Binh Dinh  Hoa Sen Group yesterday inaugurated its factory producing plastic pipes worth VND367 billion (US$16.3 million) in the central province of Binh Dinh. Covering 4.6ha in Nhon Hoa Industrial Zone, the new factory will provide 12,000 tonnes of product per year in its first phrase. The second phrase, which is slated for completion by the end of this year, will lift the plant's capacity up to 24,000 tonnes of product annually. The new plant played an important role in the company's development strategy which focused on the domestic market, the group said. It added that besides the North, it would also continue expanding its business in the Central and Highland regions. Binh Dinh was considered as an ideal investment destination due to its huge potential in economic development and its attractive investment climate. Earlier this year, the company broke ground for its steel plant in the province's Nhon Hoi Economic Zone. The VND2 trillion (US$97 million) plant will have an annual capacity of 200,000 tonnes when it goes on line in January 2017. Three-fourths of consumers buy homecare goods at supermarkets Three-fourths of Vietnamese consumers have purchased household cleaning and laundry products from large retail store chains in the past 12 months, also the same as elsewhere in Southeast Asia, according to a report of Nielsen. The report shows around 58% of consumers had purchased these products at small local, family-owned stores in the past year. Although online retail stores have yet to gain significant traction in Vietnam, 20% of consumers have purchased homecare products online in the past year, the highest ratio compared to other countries in the region such as Indonesia with 17%, Malaysia with 13%, the Philippines with 12%, Singapore with 14%, and Thailand with 16%. Prices and brands are among the key factors for Vietnamese consumers to decide to buy. Around 81% of consumers say trusted brand names are an important attribute while 73% say previous experience is an important attribute when they make a buy decision. The report also indicates Vietnamese pay more attention to eco-friendly products, with 70% preferring products with organic or all-natural ingredients, while 62% say they prefer products with environmentally friendly packaging. About 61% say they want to buy products with packaging that is easy to use and store and 58% find products with packaging sizes that fit their family needs. For detergents, 76% seek products of high efficiency and 67% want those fragrant. 61% seek detergents that help preserve color and more than half of them (55%) look for detergents suitable for multiple types of items and 54% want to buy detergents that don’t contain strong chemicals. According to the report, the bedroom is the most important place to be kept clean, followed by the kitchen and the bathroom. Around 67% of Vietnamese do the laundry everyday while only 23% do it two or three times a week. Women buy cleaning and laundry products, so they are responsible for daily household chores. Up to 70% say women make a final decision on purchasing these products while only 13% say this is the responsibility of men and 11% say this is the job of both women and men. The Nielsen report was conducted from August 10 to September 4 last year with 30,000 online shoppers from 61 nations around the world taking part. HCM City’s first quarter IIP grows 5.7% The index of industrial production (IIP) in HCMC in the first three months of this year expanded by 5.7% year-on-year, the highest in five years, the HCMC Department of Industry and Trade said. The department said business and manufacturing in the city improved, backed by loan interest support and investment stimulus. The 5.8% year-on-year growth in the manufacturing-processing industry in the period was evidence. Other key industries registered an average expansion rate of 5.3% over the same period of last year. IIP growth in January-March was well above 2.7%, 3.6%, 4.9% and 5.6% in the first quarter of 2012, 2013, 2014, and 2015 respectively. The department said local enterprises posted higher sales in the period. Their trade and service revenues edged 11.6% higher than in the same period last year, a four-year high. The city saw exports, excluding crude oil, nearing US$6.7 billion in the year to March, up 0.1% over the same period last year. and imports shot up by 8.2% to US$7.87 billion year-on-year, hence a trade deficit of US$1.17 billion. The city government has taken a slew of measures to improve the investment environment, rein in inflation, stabilize markets, and help enterprises access capital to fuel economic growth. IFC provides financing for Puma suppliers in Vietnam IFC, a member of the World Bank Group, has signed a cooperation agreement with Puma, a leading European sports brand, to offer financial incentives for suppliers of Puma to improve environmental, health, safety and social standards. In the first phase, the program will be rolled out in Bangladesh, Cambodia, China, Indonesia, Pakistan and Vietnam, according to IFC. IFC will adopt a financing structure with tiered pricing of short-term working capital, offering lower costs for those suppliers that achieve a high score in Puma’s supplier rating system. The ratings are assigned based on Puma’s monitoring of suppliers’ adherence to its social and environmental standards through an auditing process. Sergio Pimenta, IFC’s director of manufacturing, agribusiness and services, said in a statement that this deal with Puma advances IFC’s efforts to encourage small and medium enterprises such as Puma’s suppliers to improve environmental and social sustainability while achieving strong financial results. IFC currently provides financing for ready-made garment and footwear suppliers through its Global Trade Supplier Finance (GTSF) program, which provides working capital for suppliers backed by receivables from international buyers. This is a scalable way for suppliers in emerging markets to access affordable financing for their receivables over a period defined by the terms of credit. The GTSF program has run since 2010. This is a US$500 million multicurrency investment and advisory program that supplies short-term finances for emerging-market suppliers and small and medium exporting firms. According to the International Labor Organization (ILO), the textile, clothing and footwear industry attracts around 60 million workers worldwide and most of them are young women. IFC invests in this sector because it is a provider of formal jobs for low-skilled workers that can make an important contribution to poverty reduction in developing countries. IFC’s support for the industry includes its engagement through the Better Work joint program with the ILO. Better Work, operational since 2009, aims to improve both compliance with labor standards and competitiveness in global supply chains. Few firms knowledgeable about FTAs A mere 9% of enterprises that joined a recent survey in HCMC are well informed of the Trans-Pacific Partnership (TPP) trade pact, a clear indication that many local businesses show little interest in free trade agreements (FTA). The Vietnam Chamber of Commerce and Industry (VCCI) presented the findings of the survey at a seminar last week on TPP opportunities and challenges for Vietnam’s export and import activities. According to the survey, 91% of businesses have had little knowledge of the TPP, 20% have not heard about the deal, 45% have heard about it but lack a clear understanding and 26% have done some research on it. Businesses said they are preoccupied by increasingly tough market conditions at home, so they have little time to worry about other things, a VCCI representative said at the seminar held by the Ministry of Industry and Trade. According to the ministry’s Export-Import Department, the proportion of goods made to benefit from the FTAs is around 35% on average. Surprisingly, many enterprises are not aware of the rule of origin. Regarding the TPP, which is expected to go into force in 2018, complying with the origin rule is a vital factor for enterprises to enjoy tariff incentives. If there are no early training programs and enterprises are not well informed of FTAs, Vietnamese export products cannot compete in foreign markets, said a source from the department. Do Thang Hai, Deputy Minister of Industry and Trade, said when the TPP takes effect, there will be more major export markets for local manufacturers to enter at lower tariffs. According to Tran Ngoc Liem, deputy director of the VCCI in HCMC, Vietnam’s exports are forecast to pick up 28.4% by 2025 thanks to the TPP. However, domestic enterprises should pay more attention to the labor and environment requirements, trade barriers and defense measures in importing countries, Liem said. Vietnam currently participates in 16 FTAs, and the first negotiation round of the 17th FTA, which is with Cuba, according to the Export-Import Department. HCM City sees oversupply in luxury apartment market First-quarter property market reports showed an oversupply of high-end apartments in HCMC as this market segment expanded swiftly and made up a bigger proportion of homes put up for sale in the period. According to property service firm CBRE, luxury apartments made up 41% of the units offered for sale in quarter one, followed by the medium segment with 39%. CBRE projected there would be over 18,200 luxury apartments in 2016.     On the contrary, the supply of homes worth VND600 million to VND1.2 billion each has remained limited. Another property service firm, Cushman & Wakefield, said apartments of grades A and B make up 33% and 40% of the total available on the market at present. Meanwhile, Savills said in a report that 23% of Grade A homes found buyers, the highest percentage among all property market segments. Finance-banking expert Nguyen Tri Hieu said apart from rising demand, a surge in luxury home supply in the city has resulted from investors’ high expectations of the Trans-Pacific Partnership (TPP) and other free trade agreements Vietnam has signed. He said many people have purchased high-end apartments as an investment vehicle. However, investors should consider liquidity in this segment. Hieu said if property credit is not tightened as expected, an oversupply might hit the market at the end of this year and a property bubble could burst in 2017. He asked agencies to keep a close watch on risk factors to take appropriate steps.            According to Dang Hung Vo, former Deputy Minister of Natural Resources and Environment, realty developers expect foreigners to buy homes in Vietnam after the new Housing Law came into effect. However, there is little foreign interest, especially in luxury apartments. He said an oversupply on the property market is not in sight given high demand at the moment. Work to start in Sept on new Cam Ranh airport terminal Work is expected to begin on a new terminal at Khanh Hoa Province’s Cam Ranh airport in early September and it could be up and running in December next year, according to the Ministry of Transport. The airport has seen a sharp spike in passengers in recent years. Cam Ranh International Terminal Joint Stock Company (JSC) said international arrivals to Cam Ranh airport amounted to 585,000 in 2014 and shot up to nearly 891,000 last year. In the first quarter of this year alone, more than half a million foreign passengers arrived at the airport. Given the passenger traffic growth in recent years, the company has forecast international arrivals could reach 2.5 million by 2020, four million by 2025 and nearly six million by 2030. According to the company, the airport should have a terminal able to handle four million passengers by 2025, and eight million after 2030. The new terminal will cover 51,000 square meters and have two separate levels with one for departures and the other for arrivals, approach roads, car parking area and other facilities. To serve four million passengers a year, the terminal would have four rows with 20 check-in counters, 10 boarding gates, four jetways, four arrival luggage belts and two departure luggage carousels. The second runway is being constructed at the airport to handle bigger aircraft such as Airbus A350s, Boeing B747Fs and Boeing B777 LRs. Its cost is VND1.94 trillion. Ministry plans to tax shipping surcharges The Ministry of Finance is working on a plan to classify and tax surcharges of shipping firms with annual tax revenue amounting to thousands of billions of Vietnam dong. The ministry might soon issue guidelines for local tax departments to review and tax surcharges imposed by shipping firms, having collected comments from relevant agencies on this matter in early April. Over the years, shipping firms have registered freight charges that are subject to a value-added tax exemption and a corporate income tax (CIT) of only 2% but have imposed dozens of surcharges on import-export companies to offset the low freight charges. Meanwhile, these surcharges should have been declared under the category of other services that are subject to a CIT of 10% and a VAT of 5%. This practice of shipping companies has caused huge tax losses for the State. According to a draft document of the ministry, shipping surcharges include those paid by enterprises for CIF (cost, insurance and freight) exports and FOB (free on board) imports. These comprise container handling fees; fuel surcharges; and charges for security, exchange rate fluctuations, port congestion, peak season and winter transport, and bad weather conditions, with all free from VAT and subject to a CIT of 2%. Other charges levied on domestic import-export companies by foreign shipping lines are considered service fees and will be subject to a VAT of 5% on revenue and a CIT of 5%. VAT will be 10% for Vietnamese firms providing export and international shipping services. The ministry estimated the differential of different VAT and CIT calculations is huge. For example, 20 shipping firms collected combined surcharges of about VND77 trillion (US$3.45 billion) last year, and the State budget would have obtained tax revenue of over VND6 trillion (US$269 million) if these surcharges had been taxed. International shipping firms have in recent years cut the number of charges but have increased that of surcharges. Many shipping lines have posted higher revenue from surcharges than that from charges. Currently, shipping firms apply 68 kinds of surcharges and the ministry will look into them to impose appropriate tax rates. HCM City leader says will focus on growth Chairman of HCMC Nguyen Thanh Phong said on April 14 the city government will mobilize all available resources this year to fuel economic growth and improve the quality of growth and competitiveness. The city will step up support for production and solve problems faced by small and medium enterprises, Phong told a conference. Phong said the city would be implementing seven breakthrough programs in the next five years as approved by the city’s tenth Party Congress. These programs will boost infrastructure development, improve the cityscape and water supply, reduce traffic congestion and flooding, enhance environmental protection and strengthen the city’s capacity to adapt to climate change. The city government will do whatever it takes to realize 12 key targets for this year. They include gross regional domestic product (GRDP) growth of 8%, total factor productivity’s (TFP) contribution to GRDP rising to 35% or above, total investment accounting for 30% of GRDP, trained labor making up 75% of the workforce, 125,000 new jobs, urban unemployment below 4.5% and poverty reduction by 1%. HCMC Party chief Dinh La Thang said at the conference that despite many achievements, the city would have to work harder to keep up with other cities in the region. He said that as the leading economic, cultural, scientific and technological center of Vietnam, the city will mobilize all resources to speed up economic growth. Thang called for residents to help develop HCMC into a leading financial, scientific and technological center in Southeast Asia and a place worth living. U.S. investors keen on hospital projects U.S. investors have shown interest in hospital projects in HCMC but have found it hard to have adequate information to make well-informed investment decisions, heard a conference in the city on April 14. Co-held by the U.S. Commercial Service and the HCMC Department of Health, the conference on global trend and hospital development was to share experience in applying the public-private partnership (PPP) format to attract private investment into the health sector. According to the department, the city is finding local and foreign investors for a number of projects. They include Tan Kien hospital complex in Binh Chanh District; a children’s hospital; an ear, nose and throat hospital; a blood transfusion and hematology hospital; and an oncology hospital. These projects require hefty finances. Many HCMC-managed hospitals are also looking for finances to upgrade their facilities such as An Binh and Binh Dan hospitals and Children’s Hospital No. 1. Hospitals under districts, wards and communes are in need of funding for rehabilitation as well. U.S. investors said at the conference that they are keen on hospital projects in the city and that medical equipment producers and information technology and consulting enterprises want to join hospital projects. However, they are concerned about the transparency of tenders and asked if their financial benefits would be guaranteed or not.     Nguyen Ngoc Duy, head of the integrated planning division at the HCMC Department of Health, said all information about tenders could be found on the website of the Ministry of Planning and Investment. Nguyen Tan Binh, director of the HCMC Department of Health, said the department would ensure transparency in tenders for hospital projects. Regarding criteria for suppliers of equipment, Binh said big names in the sector, especially those providing maintenance systems, would be prioritized. Binh noted the city wants to set up a center to train people to operate equipment and that hospitals must be equipped with modern machines and recruit skilled employees. Patricia Williams, president and founder of Global Health Services Network LLC, said apart from investment in facilities and equipment under the PPP format, the city should attend to human resource training and management models to run hospitals more efficiently. VSSA proposes measures to stop sugar smuggling The Vietnam Sugar and Sugarcane Association (VSSA) has proposed the Government allow anti-smuggling forces to possess all the smuggled sugar they seize as a measure to crack down on sugar smuggling. VSSA said in a recent document sent to the Government that sugar was smuggled into Vietnam mainly through the borders with Cambodia and Laos and that sugar smuggling has gone almost unchecked while the capacity of anti-smuggling forces remains limited. The association suggested that smuggled sugar should be sold to those producing goods using sugar at auction rather than trading companies to prevent the latter from using the bills of the auctioned sugar to legalize their smuggled sugar. Smuggled sugar has long been spelling trouble for local sugar producers. VSSA estimated that 300,000-400,000 tons of sugar is smuggled into Vietnam a year. Local enterprises can turn out 1.5 million tons annually, enough to meet domestic demand. However, they find it hard to compete with illegally imported sugar whose prices are VND500-1,000 per kilo lower than those of local products. Pig prices surge on rising demand from China Prices of pigs at farms in Vietnam have soared to VND52,000-54,000 per kilogram compared to VND42,000 per kilogram during the Lunar New Year holiday (Tet) in February due to increasing demand from China, according to farm owners. Nguyen Van Hanh, the owner of a major pig farm in Hanoi’s My Duc District, said pig prices have grown steadily since the Tet break when lean pigs were sold at around VND42,000 per kilogram. More Chinese traders have come to Vietnam to buy pigs to offset an undersupply on their market and they buy as many pigs as Vietnamese farm owners can supply, Hanh said. He added that pigs are priced at about VND63,000 per kilogram in China. Nguyen Trong Long from livestock cooperative Hoang Long in Hanoi’s Thanh Oai District shared Hanh’s view, saying that farm owners can earn profit of VND600,000-700,000 per pig when they sell to Chinese traders. On April 4, China’s National Development and Reform Commission forecast pork prices in the northern neighbor would continue the upward trend as Chinese farmers have scaled down pig farming due to low profit. As a result, pork prices in China have risen steadily in the past year after years of decline. Earlier, Reuters reported that China would boost pork imports this year to one million tons from 770,000 tons last year. As many as five million Chinese households suspended pig farming last year due to losses and strict conditions on this. MARD announces overall planning for Macadamia development The Ministry of Agriculture and Rural Development on April 5 approved a plan to develop Macadamia farming in the northwestern and Central Highlands regions by 2020. The plan will give directions to localities in the two regions on scale and processing facilities to sustainably develop Macadamia nut production. By 2020 Macadamia nut fields in the two regions will span 9,940 hectares. The plan also set a target of building 12 more processing facilities with a capacity of 50-200 tonnes each in the regions. By 2030, Macadamia plants will cover 34,500 hectares, 7,000 hectares of which is dedicated only to the tree. Of the dedicated area, the Northwestern region will have 4,800 hectares. The number of processing facilities in both regions will increase to 30, 20 of which will be in the Central Highlands. The MARD encourages localities in the planned region to develop saplings locally and carry out market research. Farmers are advised to use modern methods of farming. Macadamia is a genus of four species of trees indigenous to Australia. The trees are native to northeastern New South Wales, and central and south eastern Queensland. Agribank given Best International Payment award The Vietnam Bank for Agriculture and Rural Development (Agribank) was given the Best International Payment 2015 award by the UK’s Standard Chartered Bank (SCB). Anurag Bajaj, Managing Director and Global Head of Sales for Banks at Standard Chartered , said that with a huge number of transactions in 2015 qualifying for high standards, Agribank could be confident of the quality of its transactions. SCB and Agribank established branch-level ties in 1996. Now up to 22 SCB branches in 22 countries have ties with Agribank. In 2015 Agribank was restructured. It has maintained business activities and its position as a key lender for agriculture and rural development. Works begin on fruit canning plant in Vinh Long A ceremony was held to kick off construction of a plant producing canned fruit and vegetables in the Mekong Delta province of Vinh Long last week. Located in an area of 4.7 hectares in Dong Thuan ward in Binh Minh town, the factory is invested in by the Song Hau Farm High-Tech Agricultural Production Company ( SOHAFARM ) and has a total investment capital of VND705 billion  (over US$3 million). The plant will have the capacity to process tens of million of litres of canned fruit and vegetables anually, with standards issued by the US Food and Drug Administration. All of the products will be supplied to the USFI, a joint venture between the US Foods International Group and the Hyundai Group from the Republic of Korea (RoK). The project is expected to be completed in June, 2017. Tay Ninh completes SOEs equitisation plan The southern province of Tay Ninh has fulfilled its plan on equitisation of State-owned enterprises (SOEs) for 2011-2015. Nguyen Van Duoc, Acting Director of the provincial Department of Finance, told a review conference on April 7 that a total of five SOEs were restructured over the past five years, including two with more than half of State stakes – The May 1 Tay Ninh Rubber and Tay Ninh Water Supply and Drainage. The three others are Tay Ninh Auto Register, Tay Ninh Mechanical and Tay Ninh Sugar. The selling of State-owned stakes in the five one-member limited liability companies brought 429.1 billion VND (19.3 million USD) to the coffer. According to Duoc, after the equitisation, the companies have maintained stable operation with better profits. Vice Chairman of the Tay Ninh province People’s Committee Duong Van Thang, who is also head of the provincial board for business renovation and development, suggested the Finance Department coordinate with the equitised enterprises to continue strengthening management and improve the operation efficiency of the companies. The department should also assign capable officials to represent State ownership at enterprises in which the State still holds a stake to ensure the proper and effective use of State capital. Thai Amata VN granted licence for US$23 mln land project in Vietnam Thailand's industrial park developer Amata VN Pcl said it had been granted a new licence by Vietnam's government to develop land for a US$23 million residential and commercial project at Long Thanh, near Ho Chi Minh City. The "Amata Service City Long Thanh 1" project will cover area of 55.4 hectares, or around 53% of the total land plot for which the company submitted licences in the southern province of Dong Nai, the Thai firm said in a statement. The construction of the project including warehouses and a logistics facility is expected to start in 2018 and completed in 2019, when the land will be ready to serve both domestic and foreign investors, the statement said. The company is developing its Amata City Long Thanh, a high technology industrial park project on 410 hectares of land for which it received a licence in 2015 and is expected to be ready for investors in 2017. Amata VN also applied for another two licences to develop two projects with a combined area of 801 hectares and is expected to receive the licences in the third quarter, it said. Amata VN, one of top three foreign-owned industrial park developers in Vietnam, has run Amata City Bien Hoa since 1994. Bright prospects for Vietnam-US agricultural cooperation There is huge potential for Vietnam and the US to cooperate in agriculture in the coming time, especially when the Trans-Pacific Partnership is likely to be approved. Andy Anderson, managing director of the Western US Agricultural Trade Association (WUSATA) made the statement after leading a delegation to visit Vietnam last week. Mr Anderson said Vietnam, a member of TPP, was a high growth market.  As US businesses are eager to expand export markets to Vietnam, WUSATA decided to make a fact-finding tour of the country to seek cooperation opportunities. During its stay in Vietnam, the delegation discussed with the Ministry of Agriculture and Rural Development and the Ministry of Industry and Trade measures to boost cooperation among businesses from the two countries. They also met Vietnam’s major importers and visited wholesale and retail units and ports. The US businesses pledged to provide technological support to help Vietnam improve the quality of agricultural produce to meet US import requirements. According to WUSATA, Vietnam has experienced modern trends in marketing and sales. So, high quality agricultural products will find outlets in commercial centres and supermarkets as well as overseas markets. Jim Barbee, Director of the Nevada Department of Agriculture, and WUSATA President, said Vietnam had a high demand for US high quality agricultural products. This was a good time for businesses from Western States, particularly small-and medium-sized enterprises, to spur exports to Vietnam. WUSATA reported that agricultural exchanges between Vietnam and the US have grown rapidly year by year. US agricultural exports to Vietnam increased from US$1.5 billion in 2010 to US$2.6 billion in 2015. US renews anti-dumping tariffs on PE bags The Vietnam Competition Authority has announced that the US International Trade Commission (ITC) has voted to renew antidumping duties on polyethylene (PE) retail carrier bags. The ITC made the decision to continue imposing high anti-dumping duties of 52.30-76.11% after determining that allowing the tariffs to expire would cause irreparable harm to manufacturers in the US. The duties, covering bags from China, Indonesia, Malaysia, Taiwan, Thailand and Vietnam, are subject to review by the ITC every five years. The commission voted 6-0 in favour of extending the duties. The US plastic bag industry began to focus on cheaper imports around 15 years ago, when the influx of products from Asia more than doubled from 2001 to 2003, according to commission testimony last February from Mark Daniels. Mr Daniels, who is the Chairman of the American Progressive Bag Alliance (APBA) industry group, testified that led to anti-dumping duties imposed against China, Malaysia and Thailand. That didn’t resolve the problem said Mr Daniels because, “market share was simply shifted to Indonesia, Taiwan and Vietnam.” Rapidly increasing low-priced imports from Asia, said Mr Daniels, are “something we [manufactures in the plastics industry] cannot likely endure.” Lumia 650 now on sale in Vietnam Microsoft Vietnam today announced the retail availability of the Lumia 650 throughout Vietnam with a recommended retail price of VND3,990,000. The Lumia 650 brings the power of Windows 10 to consumers’ pocket with beautiful craftsmanship and protection against modern security threats. “We crafted the Lumia 650 with the finest detail while delivering a consistent and familiar Windows 10 experience,” said Vu Minh Tri, general director of Microsoft Vietnam “Lumia 650 brings the best of Microsoft productivity, beautiful design and an affordable price.” With a highly polished, diamond cut and anodised aluminum frame, measuring at only 6.9mm thick, the Lumia 650 is Microsoft’s thinnest phone ever. Its crisp 5 inch HD display provides a clear and bright viewing experience, even in direct sunlight. The Lumia 650 also features up to 200GB of expandable memory for flexibility on the go. From next Tuesday, purchasers of the Lumia 650 will receive on year of Office 365 Personal with fully installed Office application on up to three different devices and 1 TB free cloud storage. Smartphones are replacing the role of PC in Asia youth’s life, resulted by Microsoft in the Asia Millennial Survey last September on 1,200 people in Asia countries, including Vietnam. With the rapidly increased demand for smartphones, the need of productivity on the go is becoming more important. Office applications for example enables them to access and share working materials from anywhere, anytime. Office 365 can provide everything that the familiar Office can do, only better. Users and access, create, edit and securely share documents, data and presentations from anywhere. Vietcombank targets 13.5% increase in assets Vietcombank has set a target of VND765.43 trillion ($34.33 billion) in assets this year, an increase of 13.5 per cent against 2015, according to documents submitted at its 2016 annual general meeting. Other targets for the year include granting credit of VND452.96 trillion ($20.31 billion), an increase of 17 per cent against 2015, customer deposits and valuable paper issuance reaching VND578.45 trillion ($25.94 billion), an increase of 15 per cent, profit before tax of VND7.5 trillion ($336.45 million), an increase of 10 per cent, a dividend of a maximum of 10 per cent, and non performing loans to be lower than 2.5 per cent.    The bank also set a target of increasing its charter capital via issuing bonus shares to existing shareholders and a private offering of shares to foreign investors, with a proportion of 35 per cent and 10 per cent of the bank’s charter capital at the time of issuance. $31.6 million canned fruit & veg factory breaks ground Construction of a VND705 billion ($31.6 million) canned fruit and vegetable factory began in the Mekong Delta’s Vinh Long province on April 6. The factory will produce 11.25 million one-liter cans of fruit and vegetables per year, five million one-liter plastic containers per year, and 45 million one-liter cardboard containers or 45 million 333-ml aluminum cans per year. All will be supplied to USFI Inc., a joint venture company between US Foods International from the US and the Hyundai Group from South Korea. The Wemakesohafarm Co. Ltd is the investor of the project. With construction at about VND305 billion ($13.67 million), the factory covers an area of 4.78 hectares and meets US and South Korean standards. It is expected to open by the middle of next year. Thanks to efforts to improve its business environment, last year Vinh Long province attracted an estimated $524.7 million in investment, an 8.32 per cent increase against 2014. Foreign investment increased 24.46 per cent, and State investment 9.4 per cent. The province is now focusing on completing infrastructure and industrial zones to help enterprises expand their business. It is also disbursing registered investment capital and attracting new investment. May opening for five-star Wyndham Legend Halong Wyndham Legend Halong will be the first five-star hotel of international standard in Vietnam under the Wyndham Hotels and Resorts brand, one of the world’s largest hotel groups, when it opens in May. The hotel features 217 rooms and suites with a wide selection of upscale facilities and world-class services, six restaurants and bars, two 750 sq m luxury penthouse suites on the top floor, and ultra-modern meeting and conference spaces. It boasts a prime location on Ha Long Street, overlooking Ha Long Bay and Bai Chay Bridge. Wyndham Hotels and Resorts, the largest hotel group in the US, signed a cooperative agreement with the Ha Long Star Tourist Service JSC on September 15, 2015 to build the Wyndham Legend Halong. “Vietnam is a key tourism destination in Southeast Asia, drawing just shy of 8 million visitors in 2014, and Ha Long Bay is one of the country’s premier attractions,” Mr. Barry Robinson, President and Managing Director, South East Asia and Pacific Rim, at the Wyndham Hotel Group told the signing ceremony last September. “With its unique beauty, its growing popularity among travelers, and its key positioning along Vietnam’s main route to southern China, Ha Long Bay is exactly the kind of destination we’re expanding in right now,” he went on. “Wyndham Legend Halong will provide visitors to this beautiful part of the world with all the comforts and amenities you would expect from a world-class, upscale hotel.” Wyndham is one of the largest hotel groups in the world, owning and operating more than 7,500 hotels worldwide. The Wyndham Legend Halong is its first investment in Vietnam. Various violations found at the state-owned Deposit Insurance of Vietnam The Government Inspectorate has just revealed various violations at the Deposit Insurance of Vietnam (DIV), from financial planning to cost management and use of finances from 2011 to 2013. According to the reports, the DIV did not follow the Ministry of Finance's planning. Even though its expenditure exceeded its set limits, it failed to file a report with the ministry. From 2012 to 2013, spending on uniforms reached VND3bn, and expenditure on phones and phone calls was over-budget by VND1bn (USD45,500). The DIV also splurged huge amounts on items such as briefcases for their staff, incredibly exceeding the set budget by VND3.2bn. The organisation also spent nearly VND4bn on buying gifts including vases or pens. The DIV is accused of violating the accounting law and having spent an excess of over VND5bn on official businesses trips or to conferences. It calculated staff monthly wages wrongly and as the result, an excess of over VND48bn in the form of salaries, welfare and bonuses was spent. The tendering procedures and price appraisal of its current renting office as well as the on-going constructions of its headquarters in the Central Highlands and southern central region also have problems. In 2013, it spent over VND2bn on bonuses for individuals and organisation outside of the sector without any signatures or verification papers. The Government Inspectorate proposed that the State Bank of Vietnam, the Ministry of Finance and the Ministry of Labour, Invalids and Social Affairs should punish violators and the individuals should engage in 'self-criticism'. Deposit Insurance of Vietnam was inaugurated in July 2000 to protect the rights of depositors, provide assistance to financial institutions, supervise and prevent risk in banking operations. Dung Quat Shipyard hands over accommodation barge to Vietsovpetro The Dung Quat Shipyard Company (DQS) handed over the VSP-06 accommodation barge to the Vietnam – Russia oil and gas joint venture (Vietsovpetro) at a ceremony held in Quang Ngai province last week. The barge was invested by Vietsovpetro and built by DQS, which took nearly three years under the direct supervision of Norwegian and Vietnamese register agencies. It measures 122m in length, 32.3m in width, 7.5m in height and has a capacity of 11,000 tonnes. The VSP-06 accommodation barge is a multipurpose specialised barge which is capable of accommodating up to 150 workers working offshore for long periods of time. The barge serves the construction, repair and replacement of spare parts of offshore floating oil and gas facilities and the transportation of goods. In addition, the VSP-06 will provide services to serve oil and gas exploration activities for drilling rigs and mines. The successful construction of the VSP-06 barge by DQS affirms the accurate policy of the government in developing the shipbuilding industry in Vietnam as well as marking the success of the Vietnam Oil and Gas Group in restructuring its operations in the field of shipbuilding. Local property market still remains positive in Q1 The positive development of the local economy was the continued growth of the domestic property market in the first quarter of this year, according to experts. The General Statistics Office reported that property trading in the first quarter gained a growth of 3.43 percent year-on-year (y-o-y), the highest recorded growth rate since 2012. The Ministry of Construction said in March, that Hanoi had 1,200 successful transactions on the property market, and HCM City had 1,150. The successful transactions belonged to the projects that were developed as schedule, had a reasonable and flexible payment method and were owned by reputed investors. Meanwhile, according to Jones Lang LaSalle Vietnam (JLL Vietnam), one of the foreign real estate services firms in Vietnam, despite the lower GDP growth compared to the first quarter in 2015, the number was still higher than first quarters of the 2011 to 2014 periods. This was partly due to the impact of climate change to agricultural production. It is too early to say whether the economy will slow down this year as Vietnam’s economic growth typically accelerates towards the year-end. The company’s quarterly reports on the property market in Hanoi and HCM City said that Foreign Direct Investment disbursement as well as newly registered capital in the first quarter of this year increased on a y-o-y basis. This confirmed that Vietnam continues to be an attractive investment destination for foreign investors. Real estate ranked second in attracting FDI during the quarter, as newly registered capital reached nearly 240 million USD from a total of 11 projects. JLL Vietnam reported the residential market of both HCM City and Hanoi continued to achieve positive outcomes. Total new supply in both cities reached nearly 20,000 newly launched units in the first quarter of this year. The total number of units sold was recorded at 18,000 units, which is an impressive figure compared to that of recent years. It can be seen the market in the first quarter continued its uptrend witnessed in 2015, with numerous projects achieving sales rates of up to 90 percent at launched. Condominium prices continued the upward movement between 1 percent and 2 percent per quarter as expected. JLL Vietnam believed that the market would maintain this tendency in the foreseeable future. Savills Vietnam also agreed that the domestic property market developed stably in the first quarter of this year. Its quarterly reports on real estate markets said that in Hanoi there were more than 5,600 units sold, a decrease of 13 percent quarter-on-quarter (q-o-q), but unchanged y-o-y. Tu Liem district continued to record the largest sales with a 24 percent market share. Grade B still led the market with more than a 66 percent share. In HCM City, transaction volume was approximately 6,300 units, down 18 percent q-o-q but up 49 percent y-o-y. CBRE Vietnam Ltd Company said in its quarterly reports that in the Hanoi property market, high-end and mid-end segments dominated sales in this quarter, with market shares of 48 percent and 36 percent respectively. Low-end segment saw a dip in sales, which could be attributed to the recent changes in the implementation of the 30 billion VND package. The credit facility will soon expire by June 2016, according to Circular 11/2013/TT-NHNN, which has started affecting buyers of the affordable sector. “The Vietnamese property market has seen 25 years of development with various ups and downs. The market is developing and maturing at a faster rate than previously seen. Developers, investors, banks and government authorities are more alert to market dynamics and prudent in their actions and roles,” Stephen Wyatt, general director of JLL Vietnam, said. “JLL believe in strong parameters and development of the property market in the future, and 2016, in particular, will remain a year of promising prospects despite global challenges.” However, CBRE Vietnam said there was a proposal of a draft amended Circular 36 regarding limits and ratios of bank financing to the property market to continually improve risk management in banking systems and encourage credit flow into other industries rather than the property segment. The change, if approved, would also create difficulties for property developers, investors, and buyers, especially as the types of financing among local developers are currently limited largely to bank financing. Moving forward, the West and South West still gather the most in terms of number of units, accounting for 75 percent of total supply, CBRE Vietnam said. Besides, Ba Dinh district was expected to welcome three high-end projects, supplying 488 units. Given the strong supply in the pipeline and a seemingly strong sales, the market might be stabilising after experiencing unprecedented growth in 2015. VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR