Thứ Năm, 27 tháng 4, 2017

Lifting farmland limits is key to agriculture development: expert

In 2016, when agriculture suffered from drought, low production and low yield, which led to a negative growth rate, the lowest since 2011, experts said that Vietnam’s agriculture needed critical reform.

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At a working session earlier this year in the northern province of Ha Nam, Prime Minister Nguyen Xuan Phuc said that Vietnam needs to shift from ‘untied agriculture’ into ‘tectonic agriculture’.

Government officials and experts have recently mentioned the farmland limit policy as a barrier to large-scale agriculture production which hinders development.

They have called to lift the farmland limit to push up land accumulation and pave the way for large-scale production.

Expansion of land limits and accumulation of land for large-scale production are expected to be the foundation for the branding of farm produce.
Government officials and experts have recently mentioned the farmland limit policy as a barrier to large-scale agriculture production which hinders development. 
Pham Chi Lan, an economist, understands the value of the new policy. However, she said the policy needs to be implemented so that land won’t fall into the hands of a few wealthy landowners.

ADB (Asian Development  Bank) commented that it is agriculture which is the key to development of Vietnam, not industry or trendy phrases such as ‘4.0 industrial revolution’.

Sixty five percent of the population live in rural areas, directly or indirectly living on agriculture. And, 47 percent of the labor force works in agriculture.

So, the new farmland policy, once applied, will play an important role for the whole economy, not only for agriculture.

Lan believes that innovation would create new opportunities for Vietnam’s agriculture.

First, farmers will have more land for cultivation because the old principle ‘every farmer has land to cultivate’ has been removed.

“Many farmers don’t cultivate fields any longer. Why do we still have to allocate land to them just because of the principle of allocating land to everyone?” she asked.

“In the past, there were too many farmers, while there was limited land fund. But the number of farmers has decreased, so the farmers who still devote themselves to rice fields have opportunities to use more land,” she said.

Second, the land accumulation will organize large-scale production, empowered by mechanization and high technology.

However, Lan pointed out that the new policy does not simply mean giving more land to farmers, and that the state needs to do more than this.

“The state needs to educate farmers about the rights and benefits they have and the responsibilities they have. It is also necessary to re-organize agricultural production,” she said.

Thanh Lich, VNN
Kudos, brickbats greet proposal to double overtime limits

A labour ministry proposal to double the overtime limit for workers to 400 hours per year has evoked a mixed response from workers, and clear disagreement from some officials.

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A labour ministry proposal to double the overtime limit for workers to 400 hours per year has evoked a mixed response from workers, and clear disagreement from some officials. - Photo

In draft revisions to the 2012 Labour Code, the Ministry of Labour, Invalid and Social Affairs has proposed that Vietnamese employees are allowed to work overtime for up to 400 hours per year.
The current limit is a maximum of 200 extra hours per year per worker, according to Article 106 of the 2012 Labor Code. In some specific areas like textiles and garments, leather, aquaculture processing, telecommunications, water and power supplies, overtime is capped at 300 hours per year.
The latest proposal came at the request of many enterprises who’ve argued for several years that more overtime is needed to improve production efficiency, increase workers’ incomes and raise the competitiveness of Vietnamese labour market.
A study by the ministry showed that the maximum number of overtime hours allowed in Viet Nam was currently 30 hours per month, much less than other countries in the region. The limit was 36 hours per month in China, 45 hours in Laos, 56 hours in Indonesia, 72 hours in Singapore, 104 hours in Malaysia, and no limit in Cambodia and the Philippines.
The ministry said its proposal sought to harmonise the benefits of enterprises and labourers, and boost the competitiveness of Viet Nam’s labour market to match other countries in the region.
Good and not-so-good
Several female workers felt overtime limits should not be increased by much because they needed time to take care of their children and families, the An ninh thu do (Capital Security) online newspaper reported.
It quoted Nguyen Thi Duyen, a female worker at the Bac Thang Long – Noi Bai Industrial Park as saying working overtime helped her increase her income, but she preferred to spend time for her children.
If the draft was approved, enterprises would have a legal basis to ask workers for more overtime work, she said.
Hoang Thu Hang, a female worker in an industrial park in Bac Ninh Province, applauded the proposal.
She said almost workers of industrial parks came from other provinces and had to cover their living expenses and save some money.
If the overtime limit was increased, she could earn more, Hang said.
Not good at all
Le Dinh Quang, deputy head of the Labour Relations Department under the Viet Nam General Confederation of Labour, said he did not agree with the proposal.
Quang said any increase in overtime limits should be carefully calculated to avoid the situation that enterprises take undue advantage of workers.
A representative of an export processing zone in Ha Noi said specific assessments of Vietnamese physical conditions had to be made before green lighting the proposal.
He said that workers at the processing zone had reported feeling faint as they worked. This meant they were suffering from high work intensity.
Other experts also advised caution about increasing overtime limits, saying workers needed enough time to rest so that they could reproduce their capacity. 
Top executive of BMW dealer in Vietnam arrested on smuggling charges

 Three people, including the top executive of the authorized Vietnamese dealership of BMW, have been arrested in an investigation involving a batch of the German luxury cars smuggled into Vietnam.

Nguyen Dang Thao is seen in this photo posted on Euro Auto's website.

Officers of the economic police unit under the Ministry of Public Security (C46) confirmed on Thursday that one of the arrestees is Nguyen Dang Thao, general director of Ho Chi Minh City-based Euro Auto, while keeping the names of the other two undisclosed.
Some local media sources said Thao no longer keeps the executive post at Euro Auto – BMW’s official authorized importer in Vietnam providing renowned BMW products and services.
However, the company’s board section on Euro Auto’s website still lists Thao as the general director, according to a check on Thursday by Tuoi Tre News.

The arrest came after the C46 launched a probe into Euro Auto importing and selling a suspicious batch of BMW cars late last year.
In December 2016, the BWM dealer was found to have sold a shipment of imported cars while it was still pending clearance from the Ho Chi Minh City customs agency, in addition to violating multiple regulations, according to the finance ministry.
Euro Auto was also unable to present certificates of origin (C/O) and other papers, documents, and receipts for its imports – a sign of fraud and customer scamming.
An inspection by the finance ministry found that Euro Auto had used fake documents, such as sales contracts and commercial receipts, to import the BMW cars in question.
Also in December, the finance ministry requested that the Ho Chi Minh City customs department suspend all shipments imported by Euro Auto from clearing customs and call on the municipal procuracy to launch a probe into the import and business activities of the car dealership.
The investigation was initiated shortly after, and the three individuals involved were arrested four months thereafter.
Nguyen Dang Thao had been Euro Auto’s director of sales and marketing before being appointed general director in 2015.
 FDI attraction up 40.5% in four months

As of April 20, as many as 734 newly-registered projects were granted with investment certificates with a total registered capital of US$4.88 billion, equal to 96% of the same period last year, according to the Foreign Investment Agency, under the Ministry of Planning and Investment.

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345 projects increased US$4.36 billion in capital, a year-on-year increase of 241.8%.
Foreign investors spent US$1.35 billion contributing capital to and purchasing shares from local firms, up 106.8%.
The total registered and additional capital in four months reached US$10.95 billion, up 40.5%.
As of April 20, US$4.8 billion in FDI were disbursed, up 3.2%.
The export value of the foreign-invested sector attained US$44.05 billion (including crude oil), up 16.1% and accounting for 71.82% of the total export value.
The processing and manufacturing sector took the lead in attracting FDI with US$7.36 billion, accounting for 69.53%.
The mining and retails sales sectors occupied the second and third positions with US$1.28 billion and US$546.68 million, making up 12% and 5.16%, respectively.
Among 83 nations and territories investing in Viet Nam, the Republic of Korea was the largest investor with US$4.05 billion, accounting for 38.25%. It was followed by Japan and Singapore with US$1.85 billion and US$1.1 billion, respectively.
The northern province of Bac Ninh led in attracting FDI with US$2.7 billion, making up 25.51%, followed by the southern provinces of Binh Duong and Kien Giang with US$1.53 billion and US$1.28 billion, respectively.

Thứ Tư, 26 tháng 4, 2017

Stricter fuel standards cause headache to major oil refineries

Higher fuel quality requirements have perplexed Vietnam’s major oil refineries.
Major fuel trading businesses were recently required to supply diesel oil level 4 (Euro 4 standard) to the market no later than on January 1, 2018, a move which put Vietnam’s two existing refineries—Dung Quat and Nghi Son—into a tight spot.
The two refineries need more time to upgrade their facilities to reach the required standards.
Dung Quat, Vietnam’s first oil refinery based in the central province of Quang Ngai, had its initial investment project approved in 1997 and revised plan approved in 2005.
At the time the technical blueprint was approved, the products made by Dung Quat were ensured to meet or surpass contemporary quality requirements.
The first batch of products came out in February 2009 and the facility was ready for commercial operation from May 2010, with products strictly meeting Vietnamese quality standard requirements.
In September 2001, following the enactment of the prime ministerial Decision 49/2011/QD-TTg (Decision 49) which requires the supply of Euro 4 fuel products to the market starting from January 2017, Dung Quat has set to upgrading and expanding its production lines.
For a combination of factors, its targets for quality improvement and capacity expansion have yet to be fully completed.
Dung Quat’s upgrade and expansion project was scheduled for completion in 2022.
A recent report by domestic state-owned fuel giant and Dung Quat’s management authority PetroVietnam stated that even when the upgrade and expansion was finalised, Dung Quat could only produce and supply petrol and diesel oil meeting Euro 2 standards.
With the current production capacity of 2.48 million tonnes of petrol and 2.33 million tonnes of diesel oil per year, Dung Quat can satisfy only part of the local fuel demand.
Nghi Son complex (NSRP), based in the north-central province of Thanh Hoa, has run into similar difficulties.
NSRP’s investment project was approved in April 2008 and its master technical design was approved in December 2009.
The bidding process took place in March 2009. This means all important steps for the project’s deployment were implemented before the enactment of Decree 49. 
According to the blueprint, the products made by NSRP will met or surpass existing quality requirements. The oil refinery is to begin test-runs and market its first batch of products within this year.
Once operational, NSRP will be producing 1.47 million tonnes of common diesel oil and 2.2 million tonnes of top-grade diesel oil per year.
Both Dung Quat and Nghi Son oil refineries will have a large part of their production falling short of Euro 4 standards, making it hard for these two oil refineries to satisfy the recent requirements on Euro 4 standards.
Earlier, Notice 398/TB-VPCP dated December 2016 of the Government Office stipulated that passenger cars and buses with diesel engines shall be applied Euro 4 emission standards from January 1, 2018, while the deadline for trucks with diesel engines will be extended to 2022.
Deputy Prime Minister Trinh Dinh Dung, however, via Document 436 TTg-CN dated March 2017, asked the Ministry of Industry and Trade to require major fuel trading businesses to work out a plan ensuring the supply and distribution of Euro 4 and 5 fuel products in the market to meet the requirements of Decision 49.
Right in this year’s fourth quarter, these firms must improve infrastructure conditions and other commercial factors to be able to supply Euro 4 diesel oil to the market no later than January 1, 2018.
By Thanh Huong, VIR
Vietnam’s notorious pyramid firm Thien Ngoc Minh Uy shutdown raises doubts

Thien Ngoc Minh Uy, infamous for duping Vietnamese consumers into joining its multi-level marketing network, has requested to stop operating as a pyramid firm, raising doubt whether they really want to withdraw from the lucrative business.

Thien Ngoc Minh Uy is infamous for duping Vietnamese consumers into joining its multi-level marketing network.Tuoi Tre

Thien Ngoc Minh Uy was fined a total of VND1.5 billion (US$66,964) by Vietnam’s Ministry of Industry and Trade in 2016 for 80 separate offences, before being hit with an additional fine of VND215 million ($9,598) earlier this year.
The offences include breach of the contracts it signed with network members, failing to meet the level of required training for new members, operating without notifying the local authorities and violating label regulations on its goods.
The trade ministry has said it would handle all violations concerned with the pyramid company strictly; however, Thien Ngoc Minh Uy has recently filed a petition to withdraw from the multi-level marketing scheme, meaning the ministry is also completing procedures to approve their request.
According to the law, once officially able to cease operating its ‘pyramid’ scheme, Thien Ngoc Minh Uy is still required to fulfill all of their obligations to the members of its network.
Given the said violations by Thien Ngoc Minh Uy, the trade ministry has transferred the case file to the investigative police unit under the Ministry of Public Security, which will take a final decision on whether to criminally punish the company.
Old wine, new bottle?
While multilevel marketing is legal in Vietnam, fraudulent variants of the scheme have fooled people with promises of easy money, before eventually scamming large sums of cash from them.
In 2015, Vietnam’s multilevel marketing sector reported more than VND7 trillion ($312.5 million) in revenue, with 1.4 million distributors receiving a total of VND2.1 trillion ($93.75 million) in commissions, according to the Ministry of Industry and Trade.
In most network marketing firms, salespeople not only sell their products, but also encourage others to join the company as distributors. Participants will from then on not only receive commissions for the sales they generate, but also for the sales of the other distributors they recruit.
While people hope that the withdrawal from the multi-level marketing industry by Thien Ngoc Minh Uy will save many from falling victim to the same ‘easy money’ trap, some remain skeptical about the unusual move by the pyramid marketing firm.
It has been speculated that the withdrawal is just another strategy by which Thien Ngoc Minh Uy can continue to attract members to its network, a tactic known as ‘old wine in a new bottle.’
On Tuesday, Thien Ngoc Minh Uy announced on its Facebook page that the trade ministry was handling its request to stop its multi-level marketing operations, accompanied by an outline of its new business model.
The company said it would become a holding company with multiple subsidiaries operating in various business sectors, including multi-level marketing.
This means that while Thien Ngoc Minh Uy will not officially be involved in the multi-level marketing sector, one of its subsidiaries will be a pyramid firm, recruiting new members on behalf of the parent company.
Vietnam needs IT engineers to meet 4.0 industrial revolution

In Vietnam, IT university graduates are plentiful, but the number of IT engineers qualified to meet requirements in the fourth industrial revolution is insufficient to meet demand.

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A report of Navigos, a job consultancy firm, showed that the number of job openings offered in the IT sector in Vietnam increased from 9,000 in 2014 to 15,000 in 2016. In 2016, IT was among the top five industries with the highest recruitment demand.

Meanwhile, the demand is predicted to increase even more sharply in the time to come when Vietnam enters the 4.0 industrial revolution era.
In Vietnam, IT university graduates are plentiful, but the number of IT engineers qualified to meet requirements in the fourth industrial revolution is insufficient to meet demand.
However, the Ministry of Industry and Trade, in its latest report, pointed out that while the worker supply in the IT sector is abundant, the number of workers qualified enough to satisfy requirements in their jobs is not high.

One of the important criteria for assessing an applicant’s qualification and knowledge is the professional certificate.

Surveys have found that certificates on project management skills, Agile project management, Cisco, Microsoft and Amazon Web Service are the most highly appreciated.

Up to 54 percent of employers are willing to pay higher salaries to the candidates who have these certificates.

According to Nguyen Thi Thanh Huong from Navigos Search Hanoi, recruitment demand is especially high for developers with Java, SQL, CSS and JavaScript languages. The demand for JavaScrip developers has increased significantly thanks to the mushrooming of online service firms.

Analysts said in 2017, technological trends in the world will have an impact on the Vietnamese IT market, including cloud computing, JavaScript, network security, Big Data, Internet of Things and Docker.

Regarding the pay for IT engineers, VietnamWorks, in its report released in March, showed developers in Vietnam can earn $1,300-2,000 if they have updated knowledge about the most advanced technologies.

The high pay is attributed to the current recruitment demand which is expected to rise.

The report showed the results of the survey conducted on 2,400 applicants and 70 recruiters in the IT sector in Vietnam.

Fifteen years ago, the demand for IT personnel was mostly for the software outsourcing sector. However, the demand has shifted to the service sector with many software development firms having built their own offices and software development centers in Vietnam.

HCMC remains the country’s largest technology center which had 53 percent of total job openings, while Hanoi had 43 percent in 2016.

According to MOLISA, Vietnam needs 80,000-100,000 workers for the IT sector every year. Meanwhile, there are 30,000 university graduates every year.

“I can introduce job opportunities with pay of $2,500. However, there are not suitable candidates in Vietnam,” Huong from Navigos Search Hanoi.

Kim Chi, VNN
PM’s visit creates new momentum for Vietnam-Laos special ties

Prime Minister Nguyen Xuan Phuc’s ongoing visit to Laos from April 26-27 is expected to create a new driving force for the enhancement of traditional friendship, special solidarity and comprehensive cooperation between the two countries. 

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Prime Minister Nguyen Xuan Phuc and his spouse  at the Wattay International Airport on April 26

As the first official visit to Laos since PM Phuc took office, the two-day visit is an important diplomatic event to celebrate the 55th founding anniversary of diplomatic ties between the two nations and the 40th anniversary of the signing of the Vietnam-Laos Treaty on Amity and Cooperation.
Vietnam and Laos recorded fruitful development in their relationship in various fields in recent years, especially in politics. 
They two sides have cooperated closely at regional and international forums, contributing to each nation’s development and maintaining peace, stability, cooperation and development in the region and the world. 
Joint statements and high-level agreements reached by leaders of the two Parties and States have been implemented, with the two sides exchanging high-raking visits, helping to enhance mutual trust between the Parties, Governments and people of Vietnam and Laos. 
Bilateral defence cooperation has also improved, while the two countries have built a Vietnam-Laos borderline of peace, stability and cooperation, and fought hostile forces and transnational and drug crimes. 
The project to increase and upgrade border markers along the boundary of Vietnam and Laos was completed with an agreement and a protocol inked in March last year, laying a legal foundation for cooperation between the two sides in managing the border. 
Vietnam now has 408 projects worth 3.7 billion USD in Laos, contributing to the country’s socio-economic development and creating jobs for many local labourers. 
Trade promotion activities between the two nations have been increased and new bilateral trade agreements and border trade agreements were implemented by both sides. 
Vietnam and Laos also cooperated in transport, education and training, and links among their ministries and sectors and border localities have been strengthened. 
The two sides have fostered affiliation in science, technology, natural resources and environment, agriculture, telecommunications, labour, culture, museum and tourism, health care, and human resources development. 
Vietnam’s official development assistance projects for Laos have benefited the country’s agriculture, broadcasting and television sectors. 
At the 39th meeting of the Vietnam – Laos Intergovernmental Committee on February 8 in Hanoi, the two sides agreed to work to promote political, diplomatic, security and defence cooperation, as well as links in trade, investment, personnel training, infrastructure development, and in management and sustainable use of water and natural resources. 
On the occasion, the two sides signed an agreement on cooperation between the two Governments in 2017, and another between the Vietnamese Ministry of Education and Training and the Lao Ministry of Education and Sports, among others, which aim to facilitate cooperation between the two nations’ sectors, localities and enterprises.
Online shoppers use mobile phones more than computers

There are more people using mobile phones to shop online than those using desktops or tablets, reported Bizweb at a recent mobile e-commerce event.

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Nearly 54 percent of online shoppers visited trading websites on mobile phones, higher than those accessing by desktop. 
The data was created from a survey of more than 27,000 client websites of Bizweb, an online commercial solutions platform.
The results showed that 53.8 per cent of online shoppers visited trading websites on mobile phones, higher than those accessing by desktop (41.3 per cent), with the rest using tablets.
For mobile phones, iPhone was the most popular device, accounting for more than 30 per cent.
Mobile phones have become popular tools for shopping, meaning businesses and shop owners risk losing more than half of potential customers if the do not ultilise this channel, heard the meeting.
In order to avert the situation, businesses need strategies to maximise sale opportunities on mobile channels, said Tran Trong Tuyen, CEO of DKT Technology JSC.
Pham Thong, marketing director of Lazada Viet Nam, said that revenue from orders on mobile phones accounted for 70 per cent of Lazada’s orders.
Thong said that there has been a shift of consumer habits. “The majority of young people are accessing the Internet by mobile phones”.
Therefore, the development of e-commerce on mobile phones was indispensable, opening up opportunities for enterprises, said Thong.
However, the Lazada representative also pointed out challenges that businesses might encounter such as services, tools and even the knowledge of the salesman about trading on mobiles.
“Therefore, to succeed when selling on phones, businesses need to invest and have appropriate strategies for development,” he advised. 

Korea-ASEAN Digital Content Business Roadshow first held in Hanoi


Representatives from 60 Korean and Vietnamese businesses gathered at the first Korea-ASEAN Digital Content Business Roadshow in Hanoi on April 25 to seek trade opportunities.

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The first Roadshow held by the Republic of Korea (RoK) Ministry of Science, ICT and Future Planning (MSIP) and the Korea Economic Daily at Lotte Hotel aims to create practical support and establish network for businesses from both sides and expand digital content exchange between the two countries.

Twenty Korean businesses participating in the event included broadcasting stations, Telecommunication enterprises, Mobile content and Convergent content (3D·Hologram·VR·AR) enterprises.

korea-asean digital content business roadshow first held in hanoi hinh 1

At the show, a MSIP representative presented the development trend of the content industry and suggested fields that businesses from the two countries can collaborate such as games, animation, film and content. 

korea-asean digital content business roadshow first held in hanoi hinh 2

Meanwhile, Pham Minh Tuan, Deputy Director at VNPT-Media Software, said 50.05 million out of 94.93 million Vietnamese people use the Internet (around 53% of population). With high Internet and mobile phone users, Vietnam is a potential market for foreign investors, especially Korean businesses.  

Participants also discussed cooperation strategy in digital content and compared notes on potential collaboration fields such as animation, mobile education, broadcasting, computer graphic and film.

Thứ Ba, 25 tháng 4, 2017

Banks’ listing enthusiasm simmers down

Banks are hesitant to go public over the persistent challenging business environment.

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In early 2014, Bank for Investment and Development of Vietnam (BIDV), a leading state-owned bank, offloaded its shares onto the HCM City Stock Exchange (HoSE).
Since then, both the northern and southern bourses were yet to see a new bank listing until the end of 2016, though in the last two months of the year many banks were racing to complete listing procedures in conjunction with requirements set by the Ministry of Finance’s Circular 180/2015.
Under the circular, public companies are required to fulfil listing procedures either on the official markets (HoSE and HNX) or on UPCoM, the unlisted public company market.
“As banks are a sort of public companies, they must also adhere to the regulation,” said senior financial expert Nguyen Tri Hieu.
Privately-owned Kien Long Bank, based in the southern Mekong Delta province of Kien Giang, was reported to have received the stock registration certificate as well as its share code in December 2016.
Similarly, Ho Chi Minh City-based Orient Commercial Bank (OCB) and Hanoi-based Maritime Bank have closed the shareholder lists to become ready for stock registration.
Most recently, on January 9, privately-owned Vietnam International Bank (VIB) listed its more than 564 million shares on the UPCoM platform under the VIB ticker.
The remaining banks all have their own reasons why they still cannot go on the bourse or register for transactions on the UPCoM.
At the recent 2017 general shareholders’ meeting of Techcombank, chairman Ho Hung Anh told shareholders that they have submitted the listing dossiers to authorised management agencies and are currently waiting for approval to be able to list on the southern bourse.
Similarly, at their 2017 general shareholders’ meeting early last week, VPBank chairman Ngo Chi Dung said they had secured the shareholders’ approval to go on bourse in late 2016, but have encountered several problems in stock registration with Vietnam Securities Depository (VSD).
They have hired a securities company for listing consultation.
“VPBank committed to going on bourse, but progress depends heavily on management agencies. We will try our best to debut on the HoSE right in this second quarter,” Dung said.
According to economic expert Le Xuan Nghia, some banks face difficulties related to their capital size or bad debts, triggering the urgent need to raise chartered capital.
In the current context, they could hardly enrich their capital sources through support from local investors, as firms are also facing a multitude of difficulties.
“Going on bourse is a viable option for them to raise capital. Banks have missed their listing promises several times. 
Therefore, a deadline must be considered to force banks to press on with listing, and this must be done immediately,” Nghia said.
Healthcare sector attracts more investments

Vietnam has been witnessing a new wave of investments in hospitals since 2015 after the government called for different sources of funding in the healthcare sector.

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According to the HCMC Healthcare Department, in the 2016-2020 period, the city received 80 investment projects in the healthcare sector with total investment capital of VND14 trillion. These included 30 projects on upgrading existing hospitals and building new ones, of which 19 hospitals will be built from now to the end of 2018.

According to the Vietnam Private Medical Practice Association, many foreign investors have shown interest in the healthcare sector. In 2016, Bumrungrad Hospital from Thailand and Lippo Group from Indonesia expressed their intention to develop hospital chains in Vietnam.

Ravindran Govindan, president of Singaporean Mercatus, which has an investment fund in healthcare, also commented it is now the right time to invest in the healthcare sector in Vietnam.

In early 2016, VOF, managed by VinaCapital, announced it had acquired a 75 percent stake in Thai Hoa International Hospital in Dong Thap province with an investment deal worth $10 million. The fund is still seeking opportunities in the healthcare sector, including equitized hospitals.
Vietnam has been witnessing a new wave of investments in hospitals since 2015 after the government called for different sources of funding in the healthcare sector.
In January 2014, Shangrila from Malaysia built the 320-bed Thanh Do International Hospital in Binh Tan district, HCMC, which was renamed City International Hospital (CIH).

Zakirul Karim, a medical quality consultant at Hanh Phuc Hospital in Binh Duong province, said that Vietnam is a magnet for investors, noting that the total spending of all Vietnamese on healthcare services accounts for 5.8 percent of GDP, the highest level in ASEAN.

Singaporean Temasek, at a meeting with the government, expressed its willingness to increase investments in Vietnam, including in private hospitals.

Meanwhile, the government of Vietnam welcomes investments from all sources into the healthcare sector, admitting that spending on public healthcare services is a burden on the state budget.

The government of Vietnam also wants to develop private healthcare, planning to have privately run hospitals account for 20 percent of total hospitals in the country by 2020.

Pham The Dong, president of Saigon ITO Hospital, said the demand for high-quality healthcare services in Vietnam has been increasing rapidly. Vietnamese spends $2-3 billion every year for healthcare services abroad.

Fat profit

In HCMC and Hanoi, the standard minimum floor area for one bed is 50 square meters. The state-owned hospitals in HCMC have become overloaded, so there is a growing tendency of relocating hospitals to the suburbs.

According to Dong, it takes four to five years on average to put one hospital into operation. The investment rate depends on the number of beds, about VND1.5-2 billion for one bed.

It takes five to seven years to take back the investment capital and if hospitals are managed well, the average profit would be 7-8 percent.
Thanh Lich, VNN