Chủ Nhật, 18 tháng 12, 2016

BUSINESS IN BRIEF 18/12

Experts call for change to accommodate rising FDI flows

 Experts call for change to accommodate rising FDI flows, Viglacera sets up construction material joint venture in Cuba, No accurate data on fuel consumption available, SMEs to have easier access to credit guarantees

Investment experts are weighing the country’s foreign direct investment situation from the year to date, striving to deliver a more comprehensive picture.
Experts at the Ministry of Planning and Investment’s Foreign Investment Agency (FIA) assumed that several points need more profound analysis when it comes to Vietnam’s foreign direct investment panorama, featuring fresh constituent factors. 
This lays down the groundwork for the country’s target to lure US$24 billion in total committed and US$15.5 billion in disbursed FDI next year. 
Accordingly, newly registered projects were on an upward trend. For the year to the end of November, Vietnam granted investment certificates to 2,240 new FDI projects, a 20.8% jump on-year. 
The projects proposing capital expansion numbered 1,075, up 55.3% on-year. 
Besides, during these 11 months, FDI projects disbursed US$14.3 billion, up 8.3% on-year. 
“The statistical figures indicate clear signs in the investment trends of both newly-licensed and supplemental capital projects. Specifically, disbursed FDI volumes show that FDI firms are having favourable circumstances,” a recent FIA report noted. 
FIA experts also highlight further positivity in the year’s FDI picture as investments in capital contribution and stake purchase forms both increased. 
Particularly, during January-November a total of 2,194 foreign investors and businesses contributed US$3.9 billion via these models and foreign investors’ capital contribution was at least 51%. 
In general, if this kind of investment was included, foreign investors’ total committed FDI volumes for the year to the end of November hit US$22 billion, an 8.9% jump on-year. 
“The investment-business circle is on a quest to uncover new investment opportunities in Vietnam. Recent positive changes in the regulatory system are shaping new investment channels for foreign investment flows. The signs show that the investors do not want to miss out on the opportunity,” the report commented. 
From the statistical angle, the capital scope of licensed FDI projects this year, however, was smaller than last year. 
Over the past 11 months, only one project surpassed the US$1-billion mark, the Republic of Korea tech giant LG’s US$1.5-billion OLED screen manufacturing project in the northern port city of Haiphong. 
Meanwhile, last year was regarded a bumper year of mammoth FDI projects. If only projects exceeding US$1 billion were taken into account, the country celebrated the US$3-billion Samsung Display Vietnam project of Korean tech titan Samsung Group, the US$2.4-billion Duyen Hai 2 thermal power plant in the Mekong Delta province of Tra Vinh, and US$1.2-billion Empire City JV Company in Ho Chi Minh City. 
Several other billion-dollar projects, such as the US$2.5-billion Nghi Son 2 build-operate-transfer power project and the US$2.5-billion Vung Ang 2 power project are reportedly in the phase of legal setup. 
“The presence of sizable projects is important, but what has commanded the attention of investors and state management agencies’ responsibility was the issue of realizing investors’ expectations.” 
“Concerted efforts from state management agencies are needed to help improve the investment and business climate and further reform administrative procedures.”
“In the context of still vulnerable standing in the world, global FDI flows will bear certain impacts, requiring positive and ground-breaking changes,” FIA experts concluded.
Viglacera sets up construction material joint venture in Cuba
The Vietnam Glass and Ceramics for Construction Corporation (Viglacera) and the Cuba Industrial Construction Group (Geicon) have contributed over 39.8 million USD in chartered capital to set up a joint venture to produce construction materials in Cuba.
Geicon is responsible for building plans to exploit and transport raw materials, ensuring both quality and quantity, to the two plants, as well as seeking to sell products at home – which are expected to make up 70 percent of the total output, and finding export markets.
It will also complete all necessary documents to establish the Prodimat commercial company that owns property and land use rights of the two factories. 
Meanwhile, Viglacera will designate or set up a new company to conclude the contract with Prodimat while upgrading two factories producing ceramic tiles and sanitary ware.
The two sides will continue completing the feasibility study and submit to Vietnamese and Cuban authorised agencies for approval
No accurate data on fuel consumption available
The Ministry of Industry and Trade lacked accurate data on the country’s annual fuel consumption when it did the planning for storage systems of crude oil and fuels until 2025.
According to a draft development plan for storage systems of crude oil and fuels from now to 2025 and with a vision towards 2035, which the ministry has passed around for comment, fuel consumption during the period of 2011-2015 was unpredictable as it depended mainly on how the Vietnamese economy performed.
Provincial industry and trade authorities had no data on the volumes of fuels which companies transported from one province to another for distribution, and those of jet fuels supplied at airports. This means the data provided by provincial industry and trade departments could not be correct.
Data of the ministry showed that fuel consumption last year soared to 15.4 million tons, up 18.4% compared to a year earlier.
From 2014 till now, fuel consumption has seen strong growth after two previous years of decline. In 2010-2015 Vietnam’s gross domestic product (GDP) grew 5.96% a year on average while average fuel consumption growth reached 4.2% a year.
SMEs to have easier access to credit guarantees
Deputy Prime Minister Vuong Dinh Hue has asked the Ministry of Finance to draft a new decree that ensures small and medium enterprises (SMEs) can easily get guarantees for the whole credit they need, the Government portal (chinhphu.vn) reports.
At a meeting on credit guarantees for SMEs this Tuesday, Hue said SMEs should not be required to have collateral for bank loans while credit guarantees would be irrevocable and guarantee fees should be made affordable.
The Prime Minister in 2011 issued Decision 03/2011/QD-TTg specifying a credit guarantee provision mechanism for SMEs to borrow from banks. In 2013, Decision 58/2013/QD-TTg was released to regulate establishment, organization and operation of credit guarantee funds for SMEs in centrally-run cities and provinces.
These decisions have created a legal framework that makes it favorable for SMEs to access loans from credit institutions, said Deputy Minister of Finance Tran Van Hieu. However, he noted, Vietnam Development Bank (VDB) and credit guarantee funds had faced problems with credit guarantees.
There are now 27 credit guarantee funds nationwide, many of them having limited capacity and poor finances (below the minimum of VND30 billion). They are insufficiently financed by local budgets and credit institutions since these funds are non-profit organizations while banks operate for profit.
Nguyen Chi Trang, deputy general director of VDB, said his bank is tasked with providing SMEs with credit guarantees but it has got no resources while VDB is experiencing difficulties.
The Finance Ministry said the credit guarantee funds had not operated effectively. The total charter capital of 27 credit guarantee funds is estimated at VND1.46 trillion, and the total outstanding credits they have guaranteed are VND361 billion and the debts they have had to pay on behalf of SMEs are VND137.95 billion.
VDB has spent VND355.15 billion and US$454,437 writing off 78 debts owed by SMEs. Of the 78 debts, 73 have yet to be recovered.
Meanwhile, VDB has been embroiled in a lot of disputes over its guarantee contracts with other banks, with court rulings forcing the guarantor to repay banks on behalf of SMEs.
However, Deputy Prime Minister Vuong Dinh Hue insisted credit guarantee funds play an important role given the fact that the tight State budget cannot assist SMEs.
Credit guarantees allow SMEs, particularly micro businesses, to gain easy access to bank loans as they have no assets as collateral to borrow.
Hue assigned the Ministry of Finance to direct VDB to ask the Prime Minister for permission to implement credit guarantee mechanisms and functions, especially the handling of the shortcomings in credit guarantees at VDB. The ministry, in coordination with other ministries, should draft a decree on credit guarantees for SMEs in parallel with the amendment of the law on SMEs that is currently passed around for comment.
Draft rule requires Internet banking providers to respect copyrights
Equipment and information technology infrastructure used for Internet banking services at banks must have copyrights and clear origins, according to a draft State Bank of Vietnam circular on Internet banking safety and security.
The draft circular specifies that in case Internet banking service providers no longer receive support from equipment producers, they will have to upgrade or replace their systems as requested by producers, says a report on the Government portal (chinhphu.vn).
Internet banking service systems must be deemed as vital and operated in line with the central bank’s regulations to guarantee safety and security for the information technology systems of the banking sector.
Banks must protect customer details and encrypt all information about online transactions with customers. They will have to take measures to keep their customer database safe and secure, said the draft circular.
Bank staff’s right to assess customer database must be limited or monitored, according to the draft.
The draft circular sets four specific value caps for online transactions: below VND50 million, below VND200 million, below VND500 million, and VND500 million or above.
For institutional clients, the limits are below VND500 million, less than VND1.5 billion and VND1.5 billion or above.
SOEs under defense ministry forced to disclose information
State-owned enterprises (SOEs) under the Ministry of National Defense will have to publicly announce their financial reports from December 23, according Circular 182 recently issued by the ministry.   
The objectives are to make clear the financial conditions of these SOEs to ensure transparency and detect irregularities in financial management and accounting, if any.
The disclosure helps officials representing State capital holdings in those businesses and laborers monitor and inspect the firms’ operations, prevent wastefulness and corruption, and improve the efficiency of State investments. 
According to the circular, these SOEs must unveil their six-month and full-year earnings reports in line with the Accounting Law. Holding companies under the ministry must release their annual financial reports and consolidated financial statements.
The circular said except for information about defense secrets, medical, social and unemployment insurance payments, wages, allowances and bonuses must be provided on the websites of these businesses.
JSC opens big warehouse in Binh Duong
New Land Viet Nam – Japan Joint-Stock Company (New Land VJ JSC) on Dec 14 has opened a two-hectare warehouse at the Binh An Textile and Garment Industrial Park in Di An Town of Binh Duong Province.
Located beside National Highway No 1A, 1 kilometre from Binh Duong Port and 10km from HCM City’s Cat Lai Port, the warehouse can store 15,500 frozen, chilled, cool and dry pallets.
Products stored include cheese, chocolate, delicatessen products, livestock and farm products, processed foods, beverages and medical products.
Under development plans approved by the Government, the area on which the warehouse is located will become a logistics hub for the South in the near future.
Huong said New Land VJ JSC had invested more than VND220 billion (over US$10 million) in this warehouse project.
The company’s three shareholders are New Land Co. (Viet Nam) and Sojitz Corp. and Kokubu Group Corp. from Japan.
$311m needed for iron ore mine
Around VNĐ7 trillion (US$311 million) has to be mobilised to restart work on the iron ore project in central Hà Tĩnh Province, a Ministry of Industry and Trade official said.
The project to exploit the Thạch Khê ore mine, which has the largest reserves in Southeast Asia, has been suspended since 2011 because of capital shortage.
Trương Thanh Hoài, director of the ministry’s Department of Heavy Industry, was responding to the request by Việt Nam National Coal-Mineral Industries Group (Vinacomin) for the capital to be mobilised from local steel consumers such as Hòa Phát and Hoa Sen, local newspapers reported.
The total reserve of ore in the mine is estimated at 544 million tonnes and its value at $35 billion. The mine would become a sound supply source for the country in the next five years, producing an estimated 20 tonnes a year, according to the Việt Nam Steel Association.
The project, which kicked off in 2009 and required a total investment of VNĐ10 trillion ($444 million), was managed by Thạch Khê Iron Joint Stock Company. However, two years later, the project was stopped after 13 million cubic metres of top soil were excavated. The reason given was the use of outdated technology.
The company was also short of capital at the time as only its biggest shareholder, Vinacomin, had fulfilled its commitments. To date, site clearance and the relocation of 4,000 households whose land has to be acquired, which will cost VNĐ3.5 trillion ($157 million), has not been completed.
In its request, Vinacomin said it has proposed the restructuring of shareholders in Thạch Khê and the use of new technology to extract ore. It has also asked the Government to allow the payment of mineral exploitation tax to be delayed until 2019 so that the company has funds for site clearance.
Officials said the ministry was considering approving Vinacomin’s request. Vinacomin expects the project to restart at the end of the year.
Vinatex-invested Pho Noi B fined for polluting the environment
Pho Noi B Textile Industrial Zone (IZ), invested by a member of state-run Vietnam Textile and Garment Group, continues to ignore the government’s environmental protection regulations.
The park was detected to discharge wastewater that exceeded national technical regulations.
According to the Hung Yen People's Committee, the IZ failed to follow the government’s environmental protection regulations. It has been fined VND550 million ($24,300) for discharging wastewater that exceeded the national technical regulation on industrial wastewater.
It was reported that wastewater discharged by Pho Noi B Textile IZ exceeded the permitted levels of biochemical oxygen and colour  by 1.9 times 1.32 times, respectively.
This is not the first time for the IZ, as in December 2014, the Vietnam Environment Administration detected it discharging untreated wastewater, which was foul-smelling and black in colour.
A Ministry of Industry and Trade (MoIT) report released in October cited Pho Noi B Textile IZ as a bad example for carrying out environmental protection regulations. The report stated that the textile park discharged wastewater directly into the environment but it did not specify the exact time.
Thus, the zone was put on the MoIT’s black list of 27 thermal power, mining, chemical, fertilizer, steel, and paper plants and projects posing a threat of environmental pollution nationwide.
Located in the centre of the northern key economic area, at the intersection of Highway 39 and Highway 5A, connecting major economic centres in the north of Vietnam, Pho Noi B Textile IZ is holding geographical advantages and was built after a green model.
Previously, a Vinatex representative confirmed that after the 2014 incident, its wastewater treatment system was improved. Currently, its system operates stably and meets the standards of regulation Code A, the primary requirements of the National Technical Regulation on Industrial Wastewater.
However, Nguyen Thanh Tam, director of Pho Noi B Textile IZ, said that its system is currently at Code B and is only preparing to update to Code A.
Officially put into operation in 2006, Pho Noi B Textile IZ is housing 20 tenants.
VietinBank provides Japanese firm with banking services     
Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) and Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) inked an agreement with Yamanashi Chuo Bank, Ltd (YamanashiBank) and Joyo Bank, Ltd (JoyoBank).
Under the agreement signed on December 15, VietinBank will directly support business operation of Japanese companies, who are customers of YamanashiBank and JoyoBank in Viet Nam.
Vietinbank will assist the Japanese banks and provide customers with services including information on market, economy, politics and investment in Viet Nam; consulting with authorized agencies on their requirements and financial demands, such as standby letter of credit and letter of guarantee if needed; consulting on mergers and acquisitions and introducing partners; supplying banking transaction services such as cash management, e-banking and trade support; foreign exchange, fund products and other capital markets.
The relationship between Viet Nam and Japan is developing as Japan continues to be a key investor in Viet Nam with annually increasing registered capital flow to Viet Nam. Therefore, Japanese FDI customers are seen as having the maximum potential for Viet Nam, especially the group of small and medium enterprises.
BTMU, a member of the Mitsubishi UFJ Financial Group (MUFG) in Japan, officially became a strategic investor holding 19.73 per cent of VietinBank’s stake. Since then, it has carried out several activities to help VietinBank gain access to Japanese FDI businesses.
To create favourable conditions and boost development, VietinBank’s management board has also approved plans to establish a relationship with other Japanese banks.
Experts warn people about synthetic diamonds     
Since it is very difficult to differentiate between natural and synthetic diamonds, people should take precautions when buying them, according to the Saigon Jewelry Association.
Nguyen Van Dung, its chairman, said in 2011 HCM City saw the appearance of “artificial diamonds” but a majority of them were cubic zirconia.
Now more synthetic diamonds have made an appearance, and they have similar characteristics as natural diamonds that normal equipment cannot make the distinction.
Synthetic diamonds are also called cultured or cultivated diamonds, and are produced in the laboratory at a comparatively low cost by using methods like HPHT (high pressure high temperature) and CVD (chemical vapour deposition).
Đoan Thi Anh Vu, a lecturer at the HCM City University of Natural Science and a member of the SJA, said synthetic diamonds have the same properties as natural diamonds: They are also made from carbon and have the same refractive index, density, hardness, dispersion, and crystalline structure as those diamonds mined from the earth.
But their cost is 30 per cent of that of the mined variety, she said.
Le Huu Hanh, SJA’s deputy chairman and deputy general director of Phu Nhuan Jewelry JSC, said amid the scarcity of natural diamonds, production of artificial and synthetic diamonds has ushered in a revolution but also caused a certain disorder in the diamond and jewellery markets.
While it is not difficult to identify artificial products like cubic zirconia and moissanite using normal equipment like a magnifying glass or microscope, modern technologies are needed to identify HPHT and CVD diamonds, he said.
Dang Ngoc Thao, director of PNJ Accreditation One-Member Company Limited (PNJLab), said in recent years artificial and synthetic diamonds have been produced in small sizes (of less than 3 mm) and embedded in jewellery, making it difficult to test them unlike larger ones.
In 2015-16, during the process of testing diamonds for many customers, PNJLab discovered that many had fake certificates, he said.
Dung said diamond traders need to invest in technologies for testing diamonds to protect their brands and interests and those of customers.
When selling, traders should clearly tell customers which diamonds are natural and which ones are synthetic or artificial, he said.
He advised customers to consult industry experts when they want to buy diamonds, and to buy only from prestigious companies or brands and demand authenticity certificates.
They were speaking at a seminar on synthetic diamonds organised by SJA with sponsorship from PNJ, which attracted more than 100 experts, business executives from the industry, officials and representatives of consumer associations. 
Consistent regional plans vital: experts     
Experts at a conference held by the National Institute for Finance on Wednesday in Ha Noi said that inconsistencies and overlaps in development planning, as well as lack of co-operation among localities, were hindering regional economic development.
Economic regions contributed significantly to the country’s growth, but inconsistent planning was causing scattered investments and undermining their competitiveness, according to participants.
The lack of co-operation in attracting investments between provinces and cities within an economic region is alarming, experts said at the conference, adding that every province and city wants to have an airport, seaport and electricity plants, for example, without considering the efficiency of such plans.
Many seaports, for example, only run at 30-40 per cent of their capacity, an expert said.
He added that overlaps in planning create competition among different regions and erode overall benefits at the national level as well as the regional one.
"It is critical to develop master planning to promote regional economic development and enhance co-ordination between central and local levels with a focus on developing traffic infrastructure," Nguyen Viet Loi, Director of the National Institute for Finance said.
In addition, incentives should be given for each region to develop its competitive advantages, Loi said.
According to Dang Van Thanh, president of the Viet Nam Association of Accountants and Auditors, a steering committee in charge of promoting regional development should be founded to supervise the planning and ensure consistency.
Expert Thai Ba Can recommended that policies to raise capital for regional development be developed comprehensively with detailed classification of investment projects for better management and resource allocation.
Viet Nam has four key economic regions in the north, centre, south and the Cuu Long (Mekong) Delta, covering 27.5 per cent of the country’s area and 51 per cent of population.
The contribution of these key economic regions to the gross domestic product rose from 51 per cent in 2003 to annually average 70 per cent in the 2010-15 period. 
Vietnam Airlines looks to launch Hanoi-Prague direct route
Vietnam Airlines, the national flag carrier of Vietnam, opened a general sales agent in Prague, the Czech Republic, on December 14, a step to prepare for opening a direct route from Hanoi to Prague in the near future.
At the opening ceremony, Vietnamese Ambassador to the Czech Republic Truong Manh Son said he hopes the inauguration of this agent will promote tourism cooperation between the two countries.
Nguyen Quoc Phuong, Director of Vietnam Airlines’ office in Europe, said his firm served more than 20 million passengers in 2016. In 2015, it put into use Boeing 787-9 and Airbus A350-900 airplanes, which are new-generation aircraft, for the routes of Hanoi-Paris, Hanoi-London, and Hanoi-Frankfurt. The carrier has also provided four-star services to serve passengers at its best.
Phuong said the opening of the agent in the Czech Republic realises Vietnam Airlines’ efforts to survey the market and carry out promotion activities in service of the launching of a direct route between Hanoi and Prague when everything is ready.
Pavel Dubovy, who is the agent’s representative, told the Vietnam News Agency that a lot of Czech tourists are interested in Vietnam. Additionally, Vietnam Airlines carries passengers not only from Europe to Hanoi or Ho Chi Minh City but also to other localities, as well as Laos and Cambodia. The inauguration of the sales agent in the Czech Republic is worth to be done.
Vietnamese steelmaker Hoa Sen ready to plunge US$700mln into deep-water port
The deep-water port is a part of a US$15-billion steel complex planned for the central province of Ninh Thuan.
Vietnam’s second-largest steelmaker Hoa Sen Group is ready to invest almost US$700 million in an international deep-water port on the country's central coast.
Steel works are usually located near deep-water ports to gain easy access to imports of iron ore and exports of the steely stuff.
The privately-owned steelmaker has revealed detailed plans for the deep-water port, which will be looked over by the local government of Ninh Thuan Province.
The 429-hectare (1060-acre) port will have the capacity to accommodate both tankers of up to 300,000 dead-weight tons (DWT) and cargo ships of 30,000–50,000 DWT, said Hoa Sen Group.
The port is expected to handle a total 53 million tons of crude oil and ore and up to 3.2 billion tons of cargo.
The deep-water port is a part of a multi-billion dollar steel complex that Hoa Sen Group and Ninh Thuan's provincial government have agreed to build.
Under the agreement, the complex in Ca Na Industrial Park will have a steel plant, a thermal power plant, cement production facilities and a deep-water port.
Hoa Sen Group plans to take advantage of the deep-water port to import raw materials and export finished steel products.
Vietnam plans to put as many as 10 steel projects into operation in 2017 and increase annual output by 10-12% to meet rising domestic demands.
Vietbuild Home 2016 on going in HCM City
The Vietbuild Home 2016 International Exhibition, an interior and exterior furnishing products fair, is taking place in Ho Chi Minh City from December 15.
The five-day event features 1,500 pavilions run by 450 businesses, including those from the Republic of Korea, Japan, Singapore, Thailand, the US, and Switzerland.
It showcases a wide range of real estate products, domestic utensils and interior and exterior decoration, lighting technology, smart houses, solar energy, and construction equipment.
Addressing the opening ceremony, Deputy Minister of Construction Bui Pham Khanh said the annual event offers a platform for trade promotion among enterprises, localities and nations. 
It also offers visitors a good opportunity to shop for New Year holidays.
Boosting labor productivity for greater competitiveness
Labor productivity is a key factor in the competitiveness of every business and every economy. Vietnam’s labor productivity has been increasing, growing 6.5% in 2015.
Vietnam’s labor productivity has grown an average of 3.8% per year over the past decade, growing 6.5% in 2015. Investment in technology and skills training in key industries like garments and textiles, footwear, energy, and IT have helped Vietnam narrow the labor productivity gap with other regional countries. 
Secretary General of the Vietnam Leather Footwear and Bag Association Phan Thi Thanh Xuan said “Two of the most important solutions are to improve the quality of human resources and to apply advanced technologies and management models. This will double our sector’s growth”.
Over the past five years, the Ministry of Industry and Trade has been carrying out  a project to help businesses boost industrial productivity and product quality. 
Director of the Vietnam Productivity Institute, Nguyen Anh Tuan said, “Labor productivity is a matter of selecting an appropriate economic structure, improving the business climate, updating technology and management and improve labor quality. We have to gear up to catch up with the productivity growth of other regional countries, which is 9% in China and 7.8% in Myanmar, for instance.”
Made-in-Thailand outlet fair opens in Hanoi
The 2016 Made in Thailand Outlet opens in Hanoi on December 15 with a variety of products on offer. 
Addressing the opening ceremony, Monapchai Vongphakdi, Thai Ambassador to Vietnam, spoke highly of the traditional friendship between the two countries. The year 2016 marked the 40th anniversary of the Vietnam – Thailand diplomatic relations.
The fair houses 164 pavilions offering food, beverages, household utensils, garment-textile, electrical devices, health care products and interior decorations of 130 Thai companies.
Nguyen Phuc Nam, Deputy Director of the Department of Asia - Pacific Market under the Ministry of Industry and Trade said the organisation of Thailand trade fairs, particularly the Made-in-Thailand Outlets, shows active support of relevant agencies for the two nations’ trade promotion as well as Vietnam’s potential in ASEAN.
According to the Ministry, ending October, the nations’ trade value posted at 9.9 billion USD, up 5.7 percent from the same period last year.
The figure is expected to reach 11.9 billion USD this year. Thailand remains Vietnam’s biggest trade partner in ASEAN.
It has been held for nine years in Hanoi and received warm response from Vietnamese customers.
The fair, organised by the Vietnam National Trade Fair and Advertising Company (Vinexad) and the Trade Office under the Thai Embassy in Vietnam at the Cultural Friendship Palace, will run until December 18.
Retailer Intimex officially sells Japanese Aomori apples
The supermarket chain, Intimex, plans to start selling Japanese Aomori apples on December 18, said an Intimex representative.
The apples are the two most favourite breeds, including red Fuji and yellow Kinsei.
This is the first imported products of Intimex in its strategy of importing clean products with high quality and clear origins.
Dinh Tien Thanh, general director of Intimex Vietnam JSC, said the company spent almost two years working with the authorities of Aomori prefecture and exporters, supervising the process of planting the apples to harvesting and packaging to bring the truly Aomori apples to Vietnamese customers.
The apples are also scheduled to be sold at Big C and Unimart stores.
Aomori prefecture is a famous apple growing region in Japan, providing 50 percent of the total volume of Japanese apples.
Transport infrastructure attracts Korean businesses
Transport infrastructure is an attractive investment field in Vietnam while the acceleration of equitising State-owned enterprises in the country will create brilliant opportunities for businesses from the Republic of Korea (RoK).
Vice President of the Korea Financial Investment Association (KOFIA) Chang Soo Han made the evaluation at a workshop held in Seoul on December 15.
He said the Vietnam-RoK free trade agreement, which came into effect at the end of 2015, has contributed to expanding the bilateral economic cooperation.
Despite global economic crisis, Vietnam has maintained its average annual economic growth of 5-6 percent, he said, adding that the signing of the Trans-Pacific Partnership (TPP) agreement and the engagement in the ASEAN Economic Community (AEC) have made Vietnam become a big potential investment destination.
Additionally, the Vietnamese Government is enacting a number of measures to attract foreign financial investment such as removing the foreign ownership limits in the stock market and expanding the equitisation of State-run businesses, which have helped improve the local investment environment, he noted.
According to Vietnamese Ambassador to the RoK Pham Huu Chi, after 30 years of rennovation, Vietnam has developed into a middle-income country.
In the 2011-2015 period, Vietnam recorded an annual average gross domestic product (GDP) growth of about 6 percent with the following years higher than previous ones, he said.
The RoK is one of the biggest overseas investors in Vietnam with 5,656 projects worth 51.5 billion USD, he added.
He added that the Vietnamese Government is exerting every effort to improve the market economy institution, legal framework, and administrative procedures as well as increase quality of human resources and infrastructure under the public-private partnership (PPP) model.
Using public-private partnerships to revamp agriculture
At the core of any sustainable development and poverty reduction strategy for agriculture is the ability to attract large dollar amounts of investment capital flows, said experts at a recent forum in Hanoi.
The availability of private sector foreign direct investment (FDI) in agriculture is constrained by many inherent risks and other factors that make it – for all intents and purposes – not a viable source of traditional FDI funding.
Smallholder farmers operating in the segment primarily produce cash crops with as much as 40% of their short-term financing needs met by their value chain partners and another 12% by commercial lenders.
Notably, virtually all their long-term financing needs remain unmet.
The gap in long-term financing is not a consequence of farmers not being able to operate profitably as there is substantial research and support for the proposition that with the extra financial funds, the country’s farmers would be able to generate positive earnings.
Rather, the gap is linked to the inherent high risks that transnational companies, private banks and other financial institutions perceive in agricultural lending— that they will lose their initial investment or not earn a reasonable rate of return on the investment.
In line with current experience, private sector finance is and most likely will remain insufficient to meet the growing demand for finance from the country’s farmers. This means that if one wants to tackle the problem of underfunding for the agriculture segment, one needs to change the status quo.
While this will require action on several fronts, one major opportunity to drastically speed up the growth of agricultural finance lies with more efficient use of public finance and transforming it into an effective means of leveraging private sector funding.
The idea that public funding, rather than being used to finance an entire project can more efficiently be used to unlock private sector finance – thus achieving leverage – is certainly not new.
In infrastructure, the concept of public–private partnerships (PPPs) has been developed actively from the 1990s onward and it makes particularly good sense with respect to providing investment for agriculture.
Simply put, traditional private sector FDI funding was always intended to be a vehicle to attract investment by transnational companies in the manufacturing segment. It was never intended to be nor has it become a source of investment for agriculture.
To talk about raising FDI from the private sector for agriculture in the traditional sense absent a PPP— is pure folly, noted speakers at the conference.
PPPs can effectively be used to attract FDI because they allow for shifting of risk to the public sector while at the same time providing for a guaranteed reasonable rate of return for the private sector investor.
At the conference, Minister Nguyen Xuan Cuong of the Ministry of Agriculture and Rural Development said that unless agriculture can effectively harness the use of the PPP any opportunity for the segment to raise FDI of an amount required to effectuate its revamp to raise its global competitiveness will be lost.
Minister Cuong noted the benefits of PPPs include cost efficiencies, improved yields, better quality, reduced post-harvest losses and enhanced infrastructural development, among others.
He added that Vietnam agriculture largely consists of smallholders as more than 90% of the farmers are small-scale operators and only about 2-3% of them sustainably operate large scale mechanized farming.
To transform the 90% of smallholders into large scale modernized farms utilizing high level production technology requires substantial investment that can only be raised through the PPP model.
To this end, he underscored the Government is in the process of perfecting the PPP arrangement with the end goal of significantly revamping the agriculture segment and delivering its sustainability.
Miniso opens three new outlets in HCM City
Well-known for its minimalist designs, good quality and accessible prices, Miniso, the popular Japanese fashion lifestyle concept brand has launched three more outlets in Vietnam.
This December, the fast-expanding brand has opened the three additional outlets in the heart of Ho Chi Minh City at prominent malls. The new stores mark a key significant milestone for the brand’s growth in the Asia Pacific region.
Dedicated to offering great quality at low-prices, the new shopping haven concept stores will offer a wide variety of Japanese-designed products – namely, creative home necessities, health and beauty products, fashion accessories, fashion bags, seasonal products and electronics, said Miniso.
Miniso also unveiled plans to soon launch two more outlets in Hanoi.
Headquartered in Tokyo, the Miniso brand was founded in 2013 by chief designer Miyake Jyunya and young Chinese entrepreneur, Mr Ye Guo Fu. The brand celebrates Japanese fast fashion and quality lifestyle living at a global scale.
Miniso is now an internationally recognized brand with more than 1000 point-of-sales worldwide, with a presence in the key cities of Tokyo, Shanghai, Bangkok, Singapore, Dubai and soon, the US.
FPT crosses milestone of 10,000 employees     
FPT Software crossed the milestone of employing 10,000 people globally, the company announced at a meeting in Ha Noi on Tuesday.
With this milestone, FPT Software edges closer to the list of top companies that have a large number of employees in the Asian region.
By 2020, the company’s target is 30,000 staffers and US$1 billion in revenue, FPT chairman Hoang Nam Tien said.
“With 17 years of experience working with large corporations across the world, I know that to have their attention, a company has to be big enough and must show them the difference in project implementation. With 10,000 personnel, FPT Software has an easier opportunity to reach customers that are large corporations, especially those on the Forbes 500 list,” said Tien.
To meet the growing demand, in the 2017-20 period, FPT Software will recruit 20,000 personnel for testing, programming, bridge engineering and project management.
Last month, the firm opened an office in South Korea, so it now has a total of 23 offices in 14 countries. Talking to VietnamPlus, Tien said the office has around 260 employees. Previously, he had said that the company has earned US$200 million in turnover and expects it to touch $230 million by the end of this year. 
Techcombank prepares for UPCoM listing     
Around 887.8 million shares of Techcombank were deposited at the Vietnam Securities Depository (VSD) on Tuesday, the first step to trading shares on the Unlisted Public Company (UpCom) market.
The shares of Techcombank, or the Vietnam Technological and Commercial Joint Stock Bank, have been deposited under the code TCB.
The value of the registered shares is VND8.878 trillion (US$394.6 million), which is VND8.878 trillion of its charter capital, under the certification for trading registration issued by the VSD on Monday.
Techcombank said the deposit was made to comply with a finance ministry circular, which requires all unlisted public companies to register for trading on UpCom no later than December 31, 2016.
The registration is necessary to increase the liquidity of Techcombank shares and will improve its standing because of transparency in disclosing information.
The bank posted a post-tax profit of VND2.29 trillion for the first nine months of 2016, a year-on-year increase of 89.5 per cent. Its total assets are worth VND222.7 trillion, up 16 per cent compared to last year’s figures. 
KBC to approve plan to purchase treasury shares     
Kinh Bac City Development Holding Corporation (KBC) on Tuesday announced its plan to buy back treasury shares worth VND200 billion (US$8.8 million).
The share buyback plan aims at reducing the proportion of outstanding shares and increasing the value of ownership for current shareholders.
According to company chairman Dang Thanh Tam, KBC can spend maximum VND475 billion to implement the share buyback plan.
Funding for the share buyback will be extracted from the firm’s share premium and undistributed post-tax profit based on the latest audited financial report.
The company is trading on the HCM Stock Exchange with code KBC. Its shares ended up 0.7 per cent at VND13,550 per share on Wednesday.
KBC posted after-tax profit of VND208 billion in the third quarter of 2016, an increase of 94 per cent from last year’s figure. After the first nine months of this year, the company’s post-tax profit rose 75 per cent year-on-year to VND628 billion, equal to 74 per cent of this year’s targeted result.
Masan Group to issue $300m in international bonds     
The management board of Masan Group has approved a plan to issue non-convertible international bonds worth up to US$300 million, the company announced in a filing to the State Securities Commission on December 13.
The USD-denominated bonds have a face value of $1,000 each and would be listed on the Singapore Stock Exchange, the statement said without giving a specific timeframe.
The 5-year and 10-year bonds will be issued in accordance with Regulation S and/or 144A of the US Securities Act.
Prospective investors include foreign institutions, investment funds and non-public banks. Credit Suisse (Singapore) Ltd and Deutsche Bank AG’s Singapore branch are advising Masan Group on the deal.
Masan Group is the HCM Stock Exchange’s eighth biggest listed firm with market capitalisation of nearly VND47 trillion ($2.1 billion) as of December 14.
Masan shares closed yesterday up 1.8 per cent after a two-day drop, valued at VND62,100 a share. The shares have lost nearly 20 per cent in value this year.
Early last week, the company secured board approval to pay a 50-per-cent share bonus to increase its equity and a 30-per-cent cash dividend, payments which are expected to completed in the first quarter of next year.
This is the first time Masan Group has decided to pay a dividend since its share debut in November 2009. Ending September, the firm had retained earnings of over VND8.5 trillion
In a related development, Masan announced it would issue 12 million shares in a private placement to MRC Ltd, an investment fund managed by the US Fortress Investment Group and Mount Kellett, for VND95,000 per share.
The proceeds from the issuance will be used to finance Masan Horizon to purchase shares of Masan Resource (MSR).
In a statement to the Ha Noi Stock Exchange on December 12, Masan Horizon registered to buy nearly 180.2 million shares of Masan Resource from December 13-26. If the transaction is completed successfully, Masan Horizon will raise its holding here from the current 72.74 per cent to 97.79 per cent.
In a tender in November, Masan Horizon offered to buy MSR shares at VND15,500 a share, slightly higher than its price of VND14,500 on the Unlisted Public Company Market on December 14.
SCIC to divest from FPT Telecom soon     
The State Capital Investment Corporation (SCIC) is likely to divest from FPT Telecom early next year, a Ministry of Finance official said.
Dang Quyet Tien, deputy director of the ministry’s corporate finance department, told dantri.com.vn recently that the move is part of the SCIC’s efforts to withdraw capital from several major enterprises in early 2017.
The SCIC will sell its entire 50.16 per cent stake in the telecommunications firm, which registered charter capital of more than VND1.37 trillion (US$61.99 million) with the Viet Nam Securities Depository.
The depository certified FPT Telecom as listing about 1.37 million shares, coded FOX with a face value of VNĐ10,000 each, on the Unlisted Public Company Market earlier this month.
FPT Telecom’s third-quarter financial report said the company earned VND4.92 trillion in net revenue from sale of goods and services in the first nine months of this year, up 20 per cent over the same period last year.
The firm earned VND848.46 billion in pre-tax profit in the nine months, a year-on-year increase of 5 per cent.
According to Thoi bao Kinh te Viet Nam (Vietnam Economic Times), FPT Telecom has paid dividends in cash at a rate of 40 per cent every year – a “golden” level in the local market.
FPT Telecom also contributed about 40 per cent to the annual profit of its parent firm – technology giant FPT, which holds a 45.64 per cent stake in the subsidiary.
Earlier this year, the Government urged the SCIC to withdraw capital from 10 major businesses, including FPT Telecom, Bao Minh Insurance Corporation, Viet Nam Infrastructure Investment & Development JSC, Ha Giang Mineral Mechanics JSC, and Viet Nam Dairy Products JSC (Vinamilk).
The remaining five are Viet Nam National Reinsurance Corporation, Tien Phong Plastic JSC, Binh Minh Plastic JSC, Sa Giang Import Export Corporation and FPT.
The SCIC auctioned a 9 per cent stake of Vinamilk on the HCM City Stock Exchange on Monday. It sold a stake of 5.4 per cent to foreign investors, gaining more than VND11.28 trillion.
VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VET/VIR

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