Chinese investors buy a series of Vietnamese companies
A report from the Foreign Investment Agency (FIA) pointed out that
Commenting about the figures, Le Xuan Truong from the
As investors, Chinese have to consider the places and modes of investment and the business fields that can bring optimal profits. There is no requirement on legal capital in certain business fields; that is, the investors can contribute capital based on their capability.
Many Chinese investors have been found contributing capital to swindle Vietnamese partners and consumers. They tricked banks out of capital and ran away, failing to pay Vietnamese workers.
Some economists have expressed their concern about the recent new Chinese investment wave, saying that it could have adverse effects. As Chinese mostly invest in small businesses and try to optimize their profit, they will ignore the requirements on environment and bring outdated technologies to
In general, only large enterprises which plan long-term investment will pay attention to solutions to ensure sustainable development, care about the community’s benefits and fulfill social responsibilities.
They have also warned that Chinese investors will bring Chinese to work at Chinese invested projects.
Truong, while admitting the high risks, said
To mitigate the adverse effects, he said, some regulations need to be amended and Chinese investors’ capability should be examined before licensing.
Nguyen Mai, chair of the Vietnam Association of Foreign Invested Enterprises (VAFIE), a renowned expert on foreign direct investment (FDI), said
He said that
Thứ Sáu, 29 tháng 12, 2017
HBSO celebrates New Year with operetta The Bat
Die Fledermaus, set in
Johann Strauss II finished the work in one month and a half. Its libretto was written by German dramatist Karl Haffner and author and composer Richard Genée.
The operetta premiered in 1874 at the Theater an der Wien in
Since New Year’s Eve of 1900, Die Fledermaus has become an integral part of the Vienne State Opera for the New Year season, and a tradition for many theatres and troupes in the
It is being staged by German director David Hermann, who has overseen numerous classical and modern operas such as The Marriage of Figaro and The Magic Flute by Mozart, Jeanne d’Arc au bûcher (Joan of Arc at the Stake) by Arthur Honegger and L’heure Espagnole (The Spanish Hour) by Maurice Ravel.
The performance will feature South Korean soprano Cho Hae Ryong, soprano Pham Khanh Ngoc and baritone Dao Mac, together with HBSO’s vocalists, musicians and dancers.
Tran Nhat Minh, who earned a master’s degree in chorus conducting at Moscow State Tchaikovsky Conservatory in
The show will begin at 8pm at
Bond market gets a promising start
More firms in
As the year comes to an end, Vietnamese companies are issuing bonds left and right, signaling a busy season for the domestic bond market. Leading electronics retailer Mobile World Corporation recently raised VND1.135 trillion (US$51.6 million) from five-year bonds, with the annual interest rate fixed at 6.55%. The issuance was guaranteed by Credit Guarantee and Investment Facility, a trust fund of the Asian Development Bank.
Another major issuer is state-owned lender VietinBank, which issued 220,000 bonds in late November to raise VND2.2 trillion (US$97 million). Prior to this sale, the bank successfully collected VND2 trillion (US$88.2 million) from its first batch of bonds in late October. All of the bonds have a 10-year maturity term, and the annual rate will be 1.2% higher than the average interest rate at major banks.
At the same time, fellow lender VPBank issued two-year bonds worth VND3 trillion (US$132.3 million), with interest rates fixed at 6.7%. Leading brokerage Ho Chi Minh Securities also went forward with a plan to collect VND800 billion (US$35.2 million) from one-year bonds, at 9% interest.
Other major securities firms such as Saigon Securities Incorporation and Viet Capital Securities are also asking for shareholders’ approval to release bonds. Both firms cite the need to fund year-end business activities and restructure their debts to enjoy lower interest rates.
In the international market, Cuu Long Pharmaceutical JSC raised US$20 million of USD-denominated bonds for the
In response to the growing corporate bond market in
A long road ahead
Industry experts welcome the increasing popularity of corporate bonds, stating that it opens a new funding source for companies in
However, the reality is that 75% of corporate bond buyers in
“Outside investors, especially individual investors, usually have no access to the firm’s business activities.
To attract more international investors, the professor suggested setting up a credit rating agency similar to major international ones like Moody’s or S&P, as well as diversifying bond offers to the market.
Nguyen Thi Thai Thuan, general director of VinaWealth Fund Management JSC, told VIR in a recent interview that most investment funds in Vietnam hold government bonds and “just a few corporate bonds of major businesses,” as there is still very little secondary trading for corporate bonds.
“The stock market is growing very fast, making it attractive to investors for the time being. However, fixed income products like bonds provide safety and lower risks, which is why I hope the legal framework will soon be finished, to pave the way for more corporate bond issuers,” said Thuan.
In a guest article for VIR, Dr. Christian Kamm from Kamm Investment Inc. also noted that foreign investors hardly consider buying corporate bonds in
However, they are likely to be more willing to do so if bonds are available on the market, supported by an up-to-date legal framework, strong accounting standards, and a transparent clearing process, Kamm said.
He added that the Asian monetary crisis of 1997 was partially a result of large bank borrowings and the absence of a bond market. A vibrant bond market would ease pressure on
“A developed bond market provides a market-driven and market-determined interest rate, for which firms can determine a realistic cost of capital for their investment and expansion,” Kamm said.
He believed that
Thứ Năm, 28 tháng 12, 2017
VN needs to develop supply chain for safe farm produce
Viet Nam needs to develop a supply chain for clean and safe farm produce, an important step to increase sales, prevent price slumps and promote safe agricultural production, experts say.
A consumer shops for VinEco products.
According to Dao Van Ho, Director of the Trade Promotion Centre for Agriculture under the Ministry of Agriculture and Rural Development, the supply of safe farm produce remains too weak to meet demand.
He said that there are around 700 supply chains for safe farm produce including vegetables, fruits, tea, pork, egg, rice and seafood products in 50 provinces and cities.
Still, demand for safe farm produce is much higher, Ho said. The supply of safe farm produce is not diverse enough and lacks adequate stores for consumers to visit.
This is a part of the reason why many agricultural products struggled in sales and faced strong drops in prices, as in the recent cases of banana in the southern
“It is critical to promote the supply chain for farm produce in an effort to restructure the agricultural sector towards increasing added value and sustainable development,” Ho said.
From the viewpoint of a distribution company, Dao Ngoc
In addition, the lack of certificates made it difficult to get products on the shelves of supermarkets and restaurants,
Vu Thi Ha, Deputy Director of the Department of Agriculture and Rural Development of Hai Duong Province, said that policies to encourage safe agricultural production following standards like VietGap and Global Gap were needed, besides enhancing the linkage of trading enterprises with farmers and producers to establish supply chains.
Deputy Minister of Agriculture and Rural Development Vu Van Tam said that two important aspects of establishing supply chains are ensuring product quality and promoting distribution networks.
Trading companies and retailers play a significant role in the supply chain of safe farm produce, according to Mamiya Chiyo, consultant to the Japan International Co-operation Agency (JICA)-funded project of promoting safe vegetable production chains in the northern region.
She said at a conference yesterday that retailers are the bridges between supply and demand. They play an important role in supervising quality and quality to ensure that demand is met.
The five-year project which would be implemented until July 2021 would enhance the capacity of supervising and managing safe farming production, developing good models of safe farm produce following GAP standards and enhancing awareness about producing and using safe products.
Nguyen Huu Hung, head of Yen Phu Co-operative, said that before cooperating with VinEco, sales of its farm produce had been unstable.
VinEco helped Yen Phu maintain strong sales with stable prices.
Foreign investors target cleared land as property market heats up
The real estate market continues to be bustling, with a series of M&A deals in 2007 and to be made in 2018.
JLL noted that hundreds of millions of dollars are about to flow into all segments of the real estate market, from houses, offices and retail premises to hotels and industrial zones. The investors are mostly from
Japanese have been increasing their presence in
The domestic market has seen many big M&A deals this year. In March,
In May, Quoc Cuong Gia Lai sold its project in Nha Be district to Sunny Island Investment, but the value of the deal remains a secret.
More recently, Phat Dat Real Estate announced the transfer of a part of Everrich 3 project in
VinaCapital has sold 70 percent of its stake in the 198.5 hectare Dai Phuoc Lotus project in Dong Nai province to China Fortune Land Development (CFLD). CFLD has signed an MOU with Tin Nghia Corporation on the development of a new industrial city in Ong Keo IZ.
The housing market segment is always attractive for investors who are aware of the rapid rise of middle-income earners.
They also target commercial real estate with a special focus on hotel and A-class offices. More and more foreign investors have come to
JLL commented that the office rent in
However, foreign investors face big challenges in
Kim Chi, VNN
2017-a year of remarkable success
With 13 socioeconomic development targets accomplished and a GDP growth of 6.7 per cent-the highest in the last ten years-2017 is considered a special year for the Vietnamese economy.
Prime Minister Nguyen Xuan Phuc said that the Vietnamese economy has developed well in almost all fields. All 13 economic goals set forth were accomplished and exceeded, contributing to developing an exciting business and investment environment and consolidating people’s confidence.
Notably, GDP growth hit 6.7 per cent, the highest in the past decade. Macroeconomic performance was stable. Inflation was brought under control, while exports surged sharply and the industry recovered at a remarkable pace.
The number of newly-established businesses was estimated at 126,860, setting a new record against the 110,100 recorded in 2016 with a total value of newly and additionally registered capital of over VND3,172 trillion (equivalent to $139.43 billion) and 26,448 businesses resumed operation.
The FDI sector made increasingly significant contributions to socioeconomic development. The amount of registered FDI capital set a new record since 2009 with $35.6 billion. Disbursed capital hit $17.5 billion, the highest figure over the last ten years.
The business environment and national competitiveness index both improved remarkably. According to the World Bank’s Doing Business 2018 report,
Earlier, the Global Innovation Index 2017 (GII 2017) of World Intellectual Property Organization (WIPO) ranked
In the last month, Moody's Investors Service also changed the outlook of the Vietnamese banking system to positive from stable. At the end of November, VN-Index and HNX-Index leaped 42.87 and 42.19 per cent, with the trading volume and value both at record levels.
Socio-political performance was stable. Diplomatic affairs and international integration were promoted, especially by the successful hosting of the APEC Vietnam 2017. The position and reputation of
According to PM Phuc, the fulfillment of the 13 preset goals was a great success, especially as the economy is shifting towards the processing and manufacturing sector and high-tech farming.
13 indicators reaching and exceeding the target
Five indicators are estimated to exceed the preset goals, including: the rate of trade deficit compared to total export turnover (which was planned at 3.5 per cent); total social development investment capital compared to GDP (planned at 31.5 per cent); growth rate of total export turnover (planned at 7 per cent); number of hospital beds per 10,000 people (planned at 25.5 beds); rate of population subscribing to health insurance (planned at 82.2 per cent).
Eight indicators are estimated to reach the preset goals, including: GDP growth of 6.7 per cent; consumer price index of 4 per cent; reducing energy consumption per unit of GDP by 1.5 per cent; reducing the poverty rate by 1-1.5 per cent according to the multi-dimensional poverty standard; reducing unemployment rate in urban areas to under 4 per cent; increasing the percentage of trained employees among total workers in the economy to 56 per cent; increasing the rate of on-going industrial parks and export processing zones having concentrated wastewater treatment system in line with environmental standards to 87 per cent; and increasing the rate of forest coverage to 41.45 per cent.
The Vietnamese Government sets growth goal of 6.5 – 6.7% for 2018 amid encouraging socio-economic signals in 2017, according to a report presented by PM Nguyen Xuan Phuc at the opening ceremony of the Legislature’s ongoing 4th session.
The Ministry of Planning and Investment (MPI) has outlined three scenarios for
Thứ Tư, 27 tháng 12, 2017
VNPT earns $220m this year
Telecom operator Viet Nam Posts and Telecommunications Group (VNPT) reached a consolidated profit of VNĐ5.01 trillion (US$220 million), a year-on-year increase of 21 per cent.
To date, VNPT has become a strategic partner in telecommunications and IT with 52 over 63 cities and provinces. - Photo tapchitaichinh.vn
This is the fourth consecutive year that VNPT has achieved a profit growth of more than 20 per cent.
This was revealed at a conference, which was held in Hà Nội on Tuesday in order to deploy tasks for the year 2018.
Specifically, the group’s total revenue reached nearly VNĐ144.75 trillion, up 7 per cent against 2016. The State budget contribution was nearly VNĐ4.12 trillion, an increase of 9.3 per cent compared to the previous year. The return on equity hit 8.2 per cent, surpassing 5.1 per cent compared to the targeted plan.
The total subscribers of VNPT reached over 34 million subscribers, of which, 31.1 million are mobile subscribers, up 21 per cent from 2016, including 4.1 million FiberVNN subscribers, up 52 per cent compared with 2016.
In 2017, VNPT had completed broadcasting over 20,000 mobile stations (2G, 3G, 4G) nationwide, bringing the total number of stations to approximately 75,000.
VNPT has also operated the AAE1 broadband cable since October 2017. The total international internet bandwidth increased by 83 per cent, compared to 2016, and the total caching capacity of VNPT increased by 2.1 times, compared to 2016.
Having considered information technology to be a key business segment in the period between 2016 and 2020, VNPT has a strong investment strategy for this field and has achieved positive results in 2017.
To date, VNPT has become a strategic partner in telecommunications and IT with 52 over 63 cities and provinces. In 2017, the group approached, introduced and deployed the intelligent city model in 17 provinces and cities nationwide.
In 2018, VNPT will focus on the development of breakthrough IT services in the business, moving from the concept of Telco to DSP service provider. It will switch to digital services, value-added services, information technology, communications and information technology.
Pham Duc Long, VNPT’s general director, said the group will strive to achieve a rise of 10 per cent profit growth over 2017 in 2018 and a revenue growth rate of 6.5 per cent to 8 per cent, compared to 2017. The return on equity is expected to increase 10 per cent compared to 2017, and the group will try to fulfil the State budget contribution in 2018.
A counter-terrorism exercise was held at
Deputy Prime Minister Truong Hoa Binh directly commanded the exercise, which involved nearly 1,000 police, soldiers and personnel from relevant agencies.
Scenarios are based on the assumption that a civil plane was attacked by a group of 8 armed hijackers while flying in
After negotiation failed, the counter-terror forces attacked and arrested the terrorists and released hostages.
The Deputy Prime Minister emphasized that in the context of complicated global security, the drills was very significant to test and ensure a multi-agency response to possible terror attacks and enhance effective co-ordination between relevant agencies.
Dinh Viet Son, deputy head of the Civil Aviation Authority of Vietnam said the exercise achieved its goals and equipped stakeholders in the aviation sector with essential skills to deal with possible terror attacks at the airport.
Former Politburo member faces up to 20 years for misconduct at PetroVietnam
Dinh La Thang could be imprisoned 10 to 20 years for deliberately violating state regulations
A former Politburo member could be sentenced to up to 20 years in prison if found guilty of wroingdoings at one of
APG submarine cable damaged
The Asia-Pacific Getaway (APG) Submarine cable from
According to VNPT, after problems on the Asia-America Getaway (AAG) and Southeast Asia-Middle East-Western Europe (SMW-3) submarine cables on November 7, which were eventually repaired on Saturday, the APG Submarine cable suddenly broke.
The SMW-3 replaced its power source at TUAS station in
The re-operation of AAG and SMW-3 helps Vietnamese network operators maintain the Internet connection, especially when the APG submarine cable crashes.
To deal with the problem, VNPT prioritises Internet traffic on other submarine cables operating stably to assure connection quality for customers.
“At present, we are collaborating with international partners to find causes and make a detailed plan to address the issue,” a representative of VNPT said.
Thứ Ba, 26 tháng 12, 2017
BUSINESS IN BRIEF 26/12
Pangasius fish export tops $1.75 billion
Vietnam Pangasius Fish Association said that pangasius fish export turnover this year exceeds US$1.75 billion and the fish farming area has increased back in the Mekong Delta region.
Specifically, new farming area is 3,299 hectares, up 14 percent while harvest area reaches 3,415 hectares, up 7 percent.
Large farming provinces are Dong Thap with 1,200 hectares, Ben Tre 753 hectares and An Giang 589 hectares.
The fish output and export turnover have strongly increased because of advantageous consumption from Chinese market which has replaced the
Pangasius price now approximates VND28,000 a kilogram in the Mekong Delta, the highest level this year and the record high for the last ten years.
Lam Dong eyes more high-quality foreign investment
A conference was held by the People’s Committee of the Central Highlands
The conference on investment, trade and tourism promotion took place within the framework of the 7th Da Lat Flower Festival that is underway in Da Lat city.
The event gathered representatives from about 50 domestic and foreign companies in the province alongside a number of experts and scholars from ministries and state agencies.
Foreign investors have poured about 528 million USD into 103 projects in Lam Dong while the province has attracted approximately 115 trillion VND (5.06 billion USD) in 820 domestic projects, said Vice Chairman of the province’s People’s Committee Nguyen Van Yen, noting most of the projects are run by small- and medium-sized enterprises (SMEs).
Yen voiced his concern over ineffectiveness of many foreign investment projects while many foreign investors have taken advantages of local investment promotion policies to occupy land for illegal purposes, like transfer of land use rights without permit.
To solve the issues, Lam Dong should give priority to big firms with good financial capability and sustainable investment, instead of SMEs, said Director of the Vietnam Institute of Economics Tran Dinh Thien. SMEs have limited funding so most of them want to earn profit at any cost, leaving severe impacts on local environment and economics, he explained.
Delegates to the conference suggested that the province should also further accelerate public administrative reforms and put more efforts to unleash its potential in tourism, hi-tech agriculture and biotechnology.
NFSC: Bad debts down to 9.5%
The 2017 Financial Market Overview Report released on December 26 by the National Financial Supervision Commission (NFSC) noted that bad debts have been cut from 11.5 per cent of total credit as at August to 9.5 per cent now, primarily due to the recent implementation of the National Assembly’s resolution on bad debt settlement.
Local banks, thanks to quicker debt resolution, have managed to clear VND70 trillion ($3 billion) in bad debts over the past year, while the rising property market has boosted credit growth, the report said.
Return on assets (ROA) and return on equity (ROE) in the banking sector have both reached their highest levels in five years, the report noted. The NFSC estimated credit growth of 19 per cent this year amid an increase of 17.3 per cent in the sector’s total assets.
State Bank of Vietnam (SBV) Governor Le Minh Hung told a plenary session last month that non-performing loans (NPLs) in the banking system, if fully calculated, were estimated at VND566 trillion ($24.93 billion) as at the end of September, accounting for 8.61 per cent of total credit.
NPLs registered on Vietnamese banks’ balance sheets, mostly incurred due to a slowdown in the country’s real estate market in the early 2010s, had been cut to 2.34 per cent of the total by the end of September, down from 2.46 per cent at the end of last year, according to SBV Governor Hung. The central bank set up an institution to deal with toxic loans, the Vietnam Asset Management Company (VAMC), in late 2013.
Credit ratings agency Moody’s in October upgraded its outlook for Vietnam’s banking system from stable to positive for the next 12-18 months, reflecting the country’s strong economic prospects and the positive outlook for most rated banks.
Together with cutting bad debts, quicker debt resolution could also reduce the burden on banks, which would better position them for the scheduled implementation of the Basel II standards in January 2020. As it stands, banks’ reported capital adequacy ratios (CARs) meet minimum requirements, but these are based on official NPL ratios that understate problem loans in the banking sector.
“Capital adequacy in the banking system is poor because rapid credit growth is already outpacing internal capital generation and sources of external capital are limited,” Moody’s lead analyst Ms. Daphne Cheng told VET, adding that the government intends to rely on banks’ earnings to close their capital shortfalls, given its lack of fiscal resources to inject fresh capital.
Technology ecosystem for restaurants introduced
Dcorp R-Keeper, a management solutions provider for the restaurant industry, has recently introduced the latest technological solutions for restaurants and coffee shop owners to stay abreast of development in the fourth industrial revolution (Industry 4.0), improve the customer experience, and increase business efficiency. A seminar was held recently in
As a pioneer in providing POS solutions and management solutions for restaurant, coffee shop, or other franchise chains, it has nearly ten years of history in the field of providing management solutions to the restaurant industry.
In the face of a developed F&B industry and the explosion of technology around the world, restaurants continually need to adopt new strategies, optimize operations, and have a powerful management system that can minimize costs and increase profits.
A the briefing event on its technology ecosystem, the company introduced its most advanced technologies being delivered to the market in the near future, such as ordering on any device (tablet, mobile phone, website, scanning QR codes, or a chat bot), convenient billing and processing of bills (mobile payment, e-wallet, e-receipt), food omni-chanels, and customer service Interaction (e-vouchers, e-coupons, membership management apps, etc.).
“More and more F&B companies are joining the market, putting great pressure on the structure of existing restaurants and coffee shops,” said Mr. James Duong Nguyen, General Director of Dcorp R-Keeper Vietnam. “In Vietnam, many problems must be resolved regarding the optimization of operations, costs, and revenue management, increasing the quality of food and, especially, providing top utility tools to increase the customer experience, shorten ordering and waiting times, using the mobile apps of customers, and gradually removing the need for paperwork.”
Dcorp R-Keeper also officially launched its marketplace for developers and technology companies to contribute apps and features to the R-Keeper POS system and the development of high tech gadgets and utilities for restaurants.
Dcorp R-Keeper is a partner of more than 2,000 restaurants and hotels, including leading brands such as
Real estate & construction enterprises up sharply
The number of real estate and construction enterprises rose sharply in 2017, by 62 per cent against 2016, with registered capital rising 66.5 per cent.
The total number of newly-established enterprises and enterprises returning after suspending operations were 153,307 in 2017, according to the Ministry of Planning and Investment, of which 126,859 were newly-established enterprises.
Total registered capital was VND3.2 trillion ($140.9 million), including registered capital of VND1.3 trillion ($57.2 million) at newly-registered enterprises and additional registered capital of VND1.8 trillion ($79.2 million).
Wholesale retail, repair, automobiles and motorbikes saw 45,411 newly-established enterprises, accounting for 35.8 per cent of the total, manufacturing and processing 16,191 enterprises, or 12.8 per cent, and construction 16,035 enterprises, or 12.6 per cent.
Wholesale, retail, and motor vehicles had the largest number of registered enterprises. In terms of growth, real estate lead the way, with numbers increasing 62 per cent.
Registered capital in real estate businesses reached VND76.7 billion ($3.37 million) on average in each enterprise, electricity, water and gas distribution VND65.7 billion ($2.8 million), arts and entertainment VND18.2 billion ($801,472), and natural resources exploitation VND17.6 billion ($774,934).
Eight component projects of North-South Highway await investment capital
The total investment capital of the eight component projects under the eastern North-South Highway is estimated at VND104.1 trillion (equivalent to $4.6 billion) during 2017-2020.
The Ministry of Transport has just issued Decision No.3535/QD-BGTVT announcing the portfolio of component projects constructing certain segments of the eastern
These build-operate-build (BOT) projects will meet the transportation demand at some urgent segments, building the eastern North-South Highway with high capacity, safety, and high speed way.
These projects will connect political-economic centres, especially three major economic zones, economic parks, and industrial parks, contributing to the completion of a synchronous infrastructure system, the promotion of socioeconomic development, ensuring national defense-security, and improving economic competitiveness.
These projects have started preparations since earlier this year and are expected to be finished by 2021.
Deputy PM approves adjustments to inland container depot master plan
Deputy Prime Minister Trinh Dinh Dung has approved adjustments to the master plan for
The adjustments aim to help inland container depot systems meet the increasing demand of export-import transport, increase sea ports’ capacity for goods clearance, ensure the safety of goods and reduce traffic congestion in urban areas.
Inland container depots will be developed into centres for organising goods transport and providing logistics services.
According to the plan, 15 inland container deports will be built across the country, including six in the north, six in the central and Central Highlands and three in the south.
Total investment capital for the plan to 2020 is estimated at 9-15 trillion VND (396.9 -661.5 million USD), while for 2020-2030 funding will be about 20-22 trillion VND (882-970.2 million USD).
In the next three years, the work will focus on developing inland container deports along transport corridors connecting to large seaports in the north and the south, with priority given to ports close to industrial clusters and parks, export processing zones, logistics centres and international border gates.
The plan will also focus on measures to enhance State management of the development of inland container deports, logistic centres and the involvement of railway and internal waterway sectors in container transport.
Tien Giang star-apple fruit breaks into
In preparation for the shipment of one tonne of star apples to the US, local enterprises inked consumption contracts with cooperatives in My Long, Huu Dao and Long Hung communes (Chau Thanh district) and Ban Long communes (Cai Lay district).
Some 56.34 hectares of star apples in Tien Giang province have been designated for growing fruit for export to the
Together with litchi, longan, rambutan and dragon fruit, star apple is the fifth Vietnamese fruit allowed to be sold in the market.
Van Phong petroleum bonded warehouse expects no losses in 2018
The Van Phong petroleum bonded warehouse in
Petrolimex chief accountant Luu Van Tuyen said in 2017, Van Phong petroleum bonded warehouse achieved pre-tax profit of VND160 billion. However, according to the monitoring report of Petrolimex, the warehouse has currently experienced accumulated losses of some VND120-130 billion after minusing net profit of 2017.
Tuyen said with the positive prospects for the warehouse business next year, it expects to not incur accumulated losses in 2018.
Tuyen said at present, Petrolimex has increased its shares at the Van Phong Petroleum Bonded Warehouse Joint Stock Company to 85 per cent from 51.4 per cent after Petrolimex Singapore Pte Ltd transferred its capital amounting to $14 million at the warehouse company to Petrolimex.
The Ministry of Industry and Trade approved this transaction under current regulations.
The Van Phong petroleum bonded warehouse began operations in June 2012 with total investment capital of $125 million and total capacity of 505,000cu.m.
However, according to Petrolimex, in 2012 alone, Van Phong Petroleum Bonded Joint Stock Company suffered a loss of VND170 billion. Since it was a new warehouse, the leasing did not reach the designed capacity. Leased capacity reached 20 per cent in 2013 and 43 per cent in the first half of 2014.
Auto market posts slow growth
Vietnam Automobile Manufacturers’ Association (VAMA) reported that auto market sales in November reached 24,752 products, up 13 percent over the previous month after many consecutive months of reduction.
The sales hit 244,670 automobiles during the first 11 months this year, down 10 percent over the same period last year. Of these, passenger cars dropped 12 percent, commercial automobiles slid 5 percent and specialized vehicles fell 15 percent.
During the 11 months, the sales of domestically assembled products reduced 19 percent while import items increased 9 percent.
Automakers’ price cut by tens to hundreds of million dong stimulated demand in November, experts said.
VAMA forecast that it is infeasible for auto consumption to post a year on year increase of 10 percent in 2017 because the year 2017 will end in only a week.
Garment, textile export turnover expected to reach $31 billion
HCMC Textile, Garment, Embroidery and Knitting Association (AGTEX) forecast that the industry’s export turnover will reach US$5.27 billion in November and December and $31 billion this year, a year on year increase of 10.23 percent.
2017 is not an advantageous year but garment and textile has obtained satisfactory growth, said the association.
Besides traditional markets such the
Export items have been diversified with high added value products including cloths, fiber and materials.
At present, businesses are sprinting to complete signed contracts and set plans. In addition, many large firms have got orders for the first quarter of next year.
AGTEX forecast that 2018 will be better than 2017 for the garment and textile industry with growth rate remaining at two digit numbers.
Pineapple price falls, farmers filled with despair
Pineapple farmers in the Mekong delta are filled with despair because fruit price dropped drastically
The Mekong delta province of Tien Giang, the biggest pineapple area in the region, has expanded the growing land of pineapples in Tan Phuoc district to 16,000 hectares, and is expecting to produce over 260,,000 tons annually for domestic consumption and export.
However, this year, fruit price dropped sharply. Farmer Dang Van Hoa who works in 20 hectares of the fruit in My Phuoc commune looked unhappy because traders proposed buying a ripe first-grade pineapple at VND4,000 - 4,500 while the second-grade and third-grade at VND2,000 - 2,500 and VND1,500 a fruit. With such price, farmers almost have made no profit.
Farmers in districts Go Quao, Vinh Thuan and U Minh Thuong in
Head of the Department of Agriculture and Rural Development in VInh Thuan District Vo Hoang Nguyen said before the district grows the fruit in the area of over 5,000 hectare yet because of its fluctuating price plus fields of pineapple are not invested by enterprises any more, farmers chopped down the fruit to grow other tree or raise shrimp.
At present, the district has approximately 1,500 hectare of fruit; worse, the area is predicted to shrink if the price continues falling.
Cau Duc pineapple in
For years, the fruit is the major tree in Hoa Tien Commune; accordingly, residents’ earnings is affected seriously when the fruit price is down.
Explained the falling price, trader Nguyen Van Lam blamed for bumper harvest in the
Deputy director of the Department of Agriculture and Rural Development in Hau Giang Le Van Doi said the province has 1,800 hectare of pineapple-growing land. Experts warned farmers to apply technique to avoid mass harvest at the same time to curb dropping price. Furthermore, authority encouraged farmers to join in cooperative which firms invest in infrastructure and buy all products.
Thanh Thang Cooperative in Hoa Tien Commune with 75 members cultivates in the area of 160 hectare supply 3,000 tons annually to the market. Participation in cooperative is inevitable trend in the future for farmers.
Vietnam needs VND9-15 trillion to develop dry port system
Deputy Prime Minister Trinh Dinh Dung has signed a decision to adjust Vietnam’s dry port system plan in which the country needs VND9-15 trillion (US$397-661.48 million) to develop dry ports by 2020.
According to the plan, the northern region will build dry ports in coastal economic areas; Hanoi-Lao Cai, Hanoi-Lang Son and Hanoi-Thai Nguyen-Cao Bang economic corridors; Northwest and
Central region and Central Highlands will build six works in Road 9, 8 and 12A economic corridors; Da Nang-Thua Thien Hue, Road 14 and Nghi Son economic areas and the
The southern region will implement the plan in Northeast and
No quality tests for polluting diesel autos
Vietnam Register will not conduct quality tests on diesel-fueled automobiles if they fail to meet emissions requirements as provided in the Prime Minister’s Decision 49/2011/QD-TTg as from next year, Hai Quan newspaper reports.
The agency has recently told auto manufacturers, assemblers and importers to strictly observe the roadmap for sticking with the auto emissions standards in Decision 49.
Enterprises have to review all plans to manufacture, assemble and import diesel autos that meet Euro 2 emissions standards and ensure their plans to be done before the year-end.
As the Ministry of Transport reviewed earlier, as of this month, there are 47 enterprises continuing with plans to import and manufacture Euro 2 diesel autos.
To ensure the effective implementation of the roadmap concerning Euro 4 emissions standards, Vietnam Register has been asked to examine the operation plan of each and every firm, report auto quality testing results to the ministry before the end of each month, propose solutions and simplify procedures so that enterprises can market their products before December 31.
Forthcoming Labor Code amendments help cut business costs
Forthcoming amendments to the Labor Code will help reduce business costs but still guarantee the rights of employees, heard a conference in
Vu Tien Loc, president of the Vietnam Chamber of Commerce and Industry (VCCI), was cited by An Ninh Thu Do news website (anninhthudo.vn) as saying that creating new jobs is a decisive factor behind economic growth.
Micro, small and medium enterprises play a crucial role in job creations, he noted.
A survey by VCCI shows around 70% of local enterprises intend to expand production in the coming time. Therefore, the annual target for 1.8 million new jobs is attainable.
Tran Thi Lan Anh, director of VCCI’s Bureau of Employer Activities, said the upcoming amendments to the Labor Code aim to protect the fundamental rights and responsibilities of citizens in the fields of labor, labor relations and labor markets by institutionalizing the provisions of the 2013 Constitution.
Labor Code revisions, if any, should allow employers to terminate labor contracts unilaterally if their employees are absent from work for more than five days without proper reasons. The code should also recognize the textile and apparel industry as a labor sub-leasing one, according to a representative of the Vietnam Textile and Apparel Association.
The association proposed increasing overtime hours to no more than four hours a day, and no more than 400 hours a year.
Mai Duc Thien, deputy head of the Department of Legal Affairs, said the Ministry of Labor, Invalid and Social Affairs would submit draft Labor Code revisions to the National Assembly in 2019.
Cash payments targeted at below 10% in 2020
The proportion of cash payments in all transactions is to be brought down to below 10% as per the non-cash payment scheme towards 2020 announced by the Government, Thanh Nien newspaper reports.
The entire market will have at least 300,000 POS terminals with the number of transactions to reach 200 million a year. All supermarkets, shopping malls, modern distribution facilities and State Treasury offices will be equipped with POS terminals.
As shown in a report of the central bank, the ratio of cash to total means of payment dropped from 19.02% in 2005 to 14.02% in 2010 and 11.45% last August. Thus, the target to reduce it to less than 10% looks achievable.
In addition, the use of bank cards is on the rise, with stable growth in card issues, volumes and transaction values. As of last September, the accumulated number of cards exceeded 127 million (up 5.5 million cards against last June), while there were 17,396 automated teller machines (ATM) and 260,187 POS terminals nationwide. The market has 76 suppliers of payment service via the Internet and 39 suppliers of mobile payment.
Some regulations to become effective in the coming time require payments via bank accounts such as the central bank’s draft document concerning capital disbursement at credit institutions.
But in reality, some enterprises still shy themselves away from bank transfer due to transfer costs. As for restaurants and shops, they are not yet interested in having POS terminals due to the fact that they have to pay a fee of 1.5-2.5%.
According to financial experts, there should be policies encouraging non-cash payments, especially low card and POS fees for both users and those accepting cards.
Bui Quang Tin, a financial expert, was cited by Thanh Nien newspaper as saying that the target of having cash payment below 10% of total payments in 2020 is attainable thanks to increasing numbers of POS terminals and ATMs. However, certain individuals and enterprises do not want to make payments via banks for fear of having their information known to management units.
The use of cash out of total payments in Southeast Asian countries ranges between 11% and 17%. Meanwhile, a much lower proportion is recorded in European countries, such as below 1% in
Seafood exports grow sharply
Vietnam had exported US$7.6 billion worth of seafood in the year to end-November, up 18.9% over the same period last year, Nguoi Lao Dong newspaper quoted a report of the General Department of Vietnam Customs.
Last year, China spent US$860 million importing seafood from Vietnam, but the number surged to more than US$1 billion in January-November this year, making China one of Vietnam’s seafood importers with turnover of over US$1 billion. Among other major markets were the
Tran Van Linh, chairman of Thuan Phuoc Seafood and Trading JSC, said
Despite many obstacles in traditional markets,
Hang Van, deputy director of Truong Giang Seafood JSC, said
According to the Export-Import Department under the Ministry of Industry and Trade, seafood shipments via Mong Cai border gate have increased significantly as exporters are shipping high-quality products to
However, some Chinese traders have bought poor quality seafood from
Material tra fish price has hit a record high of VND28,500-29,000 a kilogram, resulting in a profit of VND5,000 per kilogram for farmers.
Meanwhile, prices of tiger and white-legged shrimp in Ca Mau Province, which is the country’s largest shrimp producer, have increased considerably since early September to VND210,000-215,000 (US$9.25-9.47) and VND104,000-105,000 per kilogram respectively.
Besides, the shrimp farming area has also expanded, leading to high seafood output to supply processing plants and higher income for farmers.
Ngo Thanh Linh, general secretary of the Ca Mau Association of Seafood Exporters and Producers (CASEP), said most shrimp processing plants in the province are in dire need of material as farmers could meet only 40-50% of the demand. Due to high prices, enterprises find it hard to import material shrimp from other countries.
As of November,
Vietnamese shrimp exports to the EU have grown nearly 22% this year as shrimp of
Management of consumer finance companies to be tightened
The State Bank of Vietnam (SBV) will closely monitor and inspect the operation of consumer finance companies to ensure a transparent and healthy consumer credit market.
Data of SBV shows consumer credit has grown strongly in
For finance companies alone, the total amount of consumer credit has increased 10 times since 2011 to VND74 trillion, making consumer credit the fastest growing segment with average outstanding loan growth rate of 40% per annum in the last three years.
According to a report of the National Financial Supervisory Commission, consumer loans will maintain the high growth momentum in the coming time. The country’s total outstanding consumer loans in the year to end-November had soared by an estimated 59% compared to end-2016.
Loans for purchasing and repairing apartments, and transferring residential land account for 52.9% of the total, up from 49.5% against late last year. Loans for buying home appliances make up 15.3% while car loans account for 8.3%.
At present, there are 16 consumer finance companies in
Nguyen Tri Hieu, an economic specialist, said foreign investors have boosted investment into consumer credit in
SBV urged to amend regulations to back real estate market
The HCMC Real Estate Association (HoREA) has written to the State Bank of
HoREA petitioned SBV to amend Circular 36/2014/TT-NHNN and Circular 06/2016/TT-NHNN in a way that allows credit institutions and branches of foreign banks to continue using parts of their short-term deposits to make long-term loans for homebuyers and developers.
HoREA put forth two proposals.
In the first proposal, the central bank is asked to continue allowing credit institutions and branches of foreign banks to use 50% of their short-term funds for making medium and long-term loans next year. The policy will help support the growth of the economy as well as the property market.
As for the second proposal, HoREA agreed with a maximum ratio of 45% of short-term funds being used as medium and long-term loans between January 1 and December 31 next year stated in a draft circular amending and supplementing Circular 36/2014/TT-NHNN.
Besides, HoREA made proposals relating to the implementation of supporting policies for those purchasing affordable commercial and social housing.
HoREA proposed SBV launch housing credit packages to support buyers of social and commercial houses valued at some VND1 billion each according to Resolution 46/NQ-CP of the Government.
The central bank should allocate VND1 trillion to four credit institutions, namely Vietcombank, Vietinbank, Agribank and BIDV, to offer preferential loans for customers in need of social houses.
HoREA also proposed the National Assembly, the Government and SBV annually offer credit lines totaling VND1-2 trillion until 2020 for buyers of social houses with an annual interest rate of 4.8%.
The plan should be implemented by Vietnam Bank for Social Policies and four above-mentioned banks to effectively implement social housing policies.
In addition, incentives should be offered for investors of social housing projects in line with the Housing Law, especially social houses for rent, to reduce costs of such homes.
Banking stocks to drive market higher, experts say
Most bank stocks are entering a short-term correction after their recent strong rallies, but securities experts still expect such securities to continue advancing in the first months of 2018.
Nguyen Hong Khanh, head of analysis at Sacombank Securities Company (SBS), said on tinnhanhchungkhoan.vn website that the market has resumed its uptrend. After the correction, the VN-Index is poised to rise to new highs again.
Notably, the market saw no negative impact from recent quarterly rebalancing by exchange traded funds and the U.S. Federal Reserve’s interest rate hike.
However, Tran Anh Tuan from Vietcombank Securities Company (VCBS) said the VN-Index would miss the 1,000-point level in the last week of 2017. Though the main index still sees a positive outlook in the short term, the market will be obstructed by poor cash flow.
Securities enterprises may fail to improve margin lending as large banks have met their credit growth targets. However, in the first quarter of 2018, the main index is expected to beat new highs as listed firms will announce their 2017 financial reports and banks will continue boosting lending activities, Tuan said.
The VN-Index traded in the green for almost the entire session last Friday, closing up 0.66%. After starting on Monday with the best day of the year, up 2.5%, trading during the rest of the week was choppy, with the index up 1.9% for the week, breaking a two-week losing streak.
Lender VCB jumped to a record high, extending a 15% surge over the last seven days amid investor speculation the bank will announce strong earnings in the last quarter.
According to Khanh from SBS, the banking sector reports the biggest market capitalization on the stock market and causes significant impact on the economy. More banks are going to list on the market next year while their operations will be strengthened to meet higher standards and deal with bad debts.
Besides, bank stocks are attractive to both foreign and domestic investors. Though many lenders have increased sharply, banks remain the key drivers in the upcoming index rises early next year, the expert said.
According to Tuan from VCBS, the banking sector has made positive contributions to the recent rallies. In 2018, bank stocks will be shining thanks to better credit growths, focusing on the retail segment.
Furthermore, the bad debt handling process will go smoothly given supportive policies from the Government and the State Bank of
Can Tho builds industrial park for Japanese investors
The Vietnam-Japan Friendship Industrial Park is being built in the Mekong Delta city of
The industrial park is in fact a section covering 43 hectares inside Hung Phu 1 Industrial Park in Cai Rang District six kilometers from the city center. It is developed by Can Tho City’s Development Investment Fund (Cadif).
The developer has completed construction of Cadif-Hung Phu 1 tenement with 170 apartments some four kilometers from the industrial park to provide accommodation to Japanese experts.
Can Tho Chairman Vo Thanh Thong and Abe Masayuki, director of the Vietnam Agricultural Information Centre (VAIO), last weekend visited the industrial park.
Abe Masayuki said the industrial park is suitable to mechanical engineering, precision engineering, and electronic projects. He proposed the investor divide the land into smaller lots corresponding to the diverse scales of Japanese firms, and build some model factories to serve the immediate operations of some enterprises.
Can Tho Chairman Thong asked Cadif to quickly complete the construction of infrastructure facilities to put the industrial park into operation in April next year.
According to statistics of the Foreign Investment Agency under the Ministry of Planning and Investment, the Mekong Delta has attracted more than 170 foreign direct investment (FDI) projects, but only six projects worth US$12 million have been licensed in Can Tho. However, more Japanese investors have come to sound out opportunities in the city, so the city has launched Japan Desk, a service to assist current and potential Japanese investors.
New FDI approvals highest since 2009
Fresh foreign direct investment (FDI) approvals in
As of December 20,
Such figures are not the final ones, as certain deals might have not been updated. For example, the transfer of a huge stake of Sabeco to a company with
As the ministry estimated, FDI projects have disbursed US$17.5 billion in the year, the highest ever.
Of the 19 areas that foreign investors have invested in, the processing-manufacturing sector attracts the largest amount with US$15.87 billion, accounting for 44.2% of total registered capital. It is followed by electricity production and distribution with US$8.37 billion (23.3%) and real estate with US$3.05 billion (8.5%).
Foreign investors in
FDI capital has been injected into 59 provinces and cities nationwide. However, HCMC has made up the highest proportion of registered capital, 18.1% and US$6.5 billion. Other localities with large FDI pledges are Bac Ninh with US$3.4 billion (9.5%) and Thanh Hoa with US$3.17 billion (8.8%).
Among the major projects licensed this year is the Japan-invested BOT Nghi Son 2 thermal power plant worth US$2.79 billion in
Other BOT thermal plants getting approved are Van Phong 1 in
In addition, Samsung Display
HCMC raises VND2 trillion from bond issue
The HCMC government has raised VND2 trillion (US$88.07 million) from a municipal bond issue to fund its urgent infrastructure development projects, Tuoi Tre newspaper reports.
The city has successfully issued 20-year bonds with an annual coupon of 6.5%. Bonds with a tenor of 15 years came with an annual interest rate of 6.35%.
A representative of HCMC Finance and Investment Company (HFIC), which conducted the bond auction, hailed the 20-year bond issuance as this was the first time the city had successfully sold such debt.
Principles will be paid once when the bonds fall due while interest will be paid annually. If bond holders do not receive interest punctually, the amount will be reserved excluding compound interest.
At the most recent National Assembly session in
If the level is raised to over 90%, the city’s total outstanding loans would be VND70 trillion next year, up VND15.7 trillion, or 0.3% of gross domestic product (GDP).
The city government has proposed relevant ministries allocate official development assistance (ODA) loans from the State budget for its projects this year and next, and support investors to complete necessary procedures to speed up disbursements of ODA and preferential loans.
The city also asked for more capital for the Ben Thanh-Suoi Tien metro line, and the second phase of a project to improve the water environment in the
The city also urged ministries to ask the Government for permission to adjust the Ben Thanh-Suoi Tien urban railway project, officially known as Metro Line No. 1.
Eight BOT highway projects require over VND104 trillion
The Ministry of Transport has announced a list of eight build-operate-transfer (BOT) projects to construct the North-South Highway in the east in the 2017-2020 period, with a total investment of over VND104 trillion (US$4.57 billion).
The eight projects include the Mai Son - National Highway 45, National Highway 45 - Nghi Son, Nghi Son - Dien Chau, Dien Chau - Bai Vot, Nha Trang - Cam Lam, Cam Lam - Vinh Hao, Vinh Hao - Phan Thiet, and Phan Thiet - Dong Nai.
The total investment of the eight projects is estimated at over VND104 trillion, including over VND40.3 trillion funded by the State budget in order to conduct land clearance and the resettlement of affected households.
The project on building the 106km of Vinh Hao - Phan Thiet segment is expected to require the highest investment at over VND19.6 trillion, including VND8 trillion worth of State budget, while the Nha Trang - Cam Lam project with a total length of 29km is estimated to need the lowest investment at over VND5.1 trillion.
According to the Ministry of Transport, it is an urgent need to invest in these projects to meet the increasing transport demand of the related localities and to connect key national economic regions.
The report on the feasibility study of these projects is being completed and these projects are scheduled to be finished in 2021.