BUSINESS IN BRIEF 16/4

Poultry breeding heats up again


Poultry breeding heats up again, Nationwide rice exports hit 1.36mln tons, Vietnam & Australia mark 25 years of agriculture cooperation, Bao Viet Holdings' 2017 net profit up 37%



General manager CP Vietnam Montri Suwanposri said that Vietnam’s poultry prices are closer with prices of other countries; accordingly, CP Vietnam will sell chicken to Japan after finishing paper works as per the partners’ requirement.

Montri Suwanposri added that C.P in Thailand is the leading firm exporting chicken meat to Japan for years with the quantity of five million a week.

There has been an increase in poutry meat orders lately because many countries banned import chicken from Brazil , an exporter of chicken to Japan, after food safety scandal. These countries switched to import chicken meat from Asian countries especially Thailand.

At present, prices of poultry in hi-tech farms in Vietnam is similar to chicken prices in other Asian countries, accordingly, C.P Thailand will share its orders with Vietnamese firms and C.P Vietnam has planned to sell chicken meat to Japan in 2019.

In 2017, Vietnam’s livestock sector marked its new stage when Koyu & Unitek shipped its first batch of chicken meat to Japan which is considered a difficult market with tough restrictions. Monthly, shipment of the meat is around 200 tons while the demand is buoyant with 300 tons a month.

According to the Ministry of Agriculture and Rural Development’s Animal Health Department. The shipment is the fruit of two sides’ talks in 2016. The Department of Animal Health studied the World Organization for Animal Health (OIE)’s regulations carefully before discussing with Japanese counterpart.

Japan agreed to cut some requirements on chicken made in Vietnam and used only OIE standards such as: the animal raised in farms quarantined for diseases; production chains in manufacturers which meet Japan’s veterinary requirements, the national measures against diseases on poultry as well as food safety supervision plan on chicken for export.

Therefore, after a long pause because of fierce competition with frozen chicken meat, poultry breeding revived. The Ministry of Agriculture and Rural Development said it is result of switching from small raising in households to raising in farms with adoption of hi-tech to prevent diseases.

The quantity of farms increased from 9,300 farms in 2013 to 9,900 farms in 2014. In 2016, around 22,000 farms were set up in the country.

Director of Ba Huan Company Ms. Pham Thi Huan said that thanks to hi-tech adoption in breeding, costs of breeding is down; farmers can earn profit from breeding.

Truong Chi Thien from Vinh Thanh Dat Company said that prices of eggs in Vietnam are equal in many countries; therefore, other countries’ eggs will have no chance for competition in Vietnam.

Deputy chairman of Poultry Association in the Southeast region Vietnam Nguyen Van Ngoc said that price of a pack of ten eggs went upVND3,000 – 4,000 ( or VND16,000 a pack of ten) , lower that other countries and at average compared to the world. No importer has imported eggs so far, said Ms. Huan.

Meantime, if the government just allows import of whole frozen chick, foreign chicken can’t beat with local’s ; however, at present, importers just imported low parts of a waterfowl such as thigh, legs, and wings making local farmers in despair.

The Department of Animal Health said that in 2017 some more firms namely Ba Huan Company, DTK Company, Thanh Duc Company, C. P Vietnam, DABACO, Cau Tre proposed the department helping to finish paper works to sell fresh eggs to South Korea, ASEAN.

The Department is helping Koyu & Unitek, C.P Vietnam to sell processed chicken meat to EU, Mexico, Mongolia, Myanmar, Iraq, China, and Singapore. Additionally, the department supports Bel Ga (Bel Chicken) to sell bred eggs and poultry to Myanmar, Lao and Cambodia.

Nationwide rice exports hit 1.36mln tons

Vietnam’s rice export has had a good sign as its turnover increased strongly in the first quarter of 2018.

Ministry of Agriculture & Rural Development said rice exports nationwide reached over 1.36million tons in the first quarter of 2018 worth US$ 669million, an increase of 9.4 percent in volume and 24 percent in value over the same period of last year.

Ministry of Trade & Industry said since February, rice had been one of 3 key agricultural goods having a high growth rate and in the end of 2017, the price of rice export in the country increased and being stood at higher level than other countries such as Thailand, Pakistan, India from US$ 50 to 100 per ton.

Vietnam & Australia mark 25 years of agriculture cooperation

The governments of Vietnam and Australia celebrated their partnership and cooperation in agricultural research on April 11.

The anniversary is even more meaningful given the two countries are also celebrating 45 years of diplomatic relations, said Australian Ambassador to Vietnam, H.E Craig Chittick. “Cooperation in the agriculture and forestry industries has been a very important part of Australia’s relationship with Vietnam throughout the 45 years of diplomatic links between the two countries,” he said. “Australia’s support to Vietnam through agricultural research collaboration has been consistent and efficient, as part of our larger aid program in Vietnam. I am proud to see that the support has greatly contributed to today’s Vietnam, particularly the transformation of Vietnam’s agricultural sector.”

The research collaboration has been led by the Australian Centre for International Agricultural Research (ACIAR) since 1993. It has invested around A$100 million ($77.5 million) in 170 projects and at the same time hundreds of postgraduate scholarships for Vietnamese researchers to study in Australia have been also provided. Many of these scientists are now research leaders.

ACIAR has recently announced its research collaboration strategy with Vietnam for 2017-2027, under which it will continue supporting the country in agricultural research for development, focusing on the northwest highlands, the central highlands, and the Mekong Delta.

ACIAR is a special partner of Vietnam in agricultural research and development. Collaboration and knowledge-sharing from Australia and the world through ACIAR have promoted research capacity in Vietnam, brought advances in science and technology, and contributed to poverty reduction, according to Dr. Le Quoc Doanh, Deputy Minister of Agriculture and Rural Development. “The positive impact of these partnerships is reflected in the research and development of acacia and eucalypt plantations, the rapid expansion of the oyster industry, and the successful market engagement for fruit and vegetables from the northwest region, to give just three examples,” he said.

Meanwhile, Professor Andrew Campbell, ACIAR Chief Executive Officer, said that Australia has extensive research and development experience that it has been able to share with Vietnamese counterparts to build on their capabilities to tackle their problems more effectively. This includes expertise in horticulture and livestock production and marketing, food quality and safety assurance, water saving practices, plantation forest management, and aquaculture. “We believe that there is a significant benefit for both Australia and Vietnam to continue to nurture agricultural research exchange,” he said.

ACIAR is part of the Australian Government’s International Development Assistance Program and contributes to the program’s objectives of helping developing countries reduce poverty and achieve sustainable development. It funds collaborative agricultural research for development projects carried out by Australian and international research institutions. These projects seek to solve agricultural problems in developing countries and Australia.

Bao Viet Holdings' 2017 net profit up 37%

Bao Viet Holdings recorded consolidated net profit of VND32.7 trillion ($1.5 billion) in 2017, representing 113.4 per cent of its annual plan and up 37.6 per cent, according to its latest financial report. It yet again holds the leading position in Vietnam’s insurance market.

Total assets as at December 31, 2017 were VND91.4 trillion ($4 billion), up 25.2 per cent, while owners’ equity was VND14.4 trillion ($631.7 million), up 5.7 per cent against the end of 2016. After-tax profit on charter capital stood at 15.1 per cent.

Its stock (BVH) was one of the most stable in the VN30-Index. In the opening months of this year it increased sharply, closing at VND107,000 ($4.70) on April 9, for capitalization of over $3 billion. With stable business results, large capitalization, and high trading volumes, BVH has become a popular destination for cash flows from long-term investors and international investment funds.

Life insurance grew strongly, with total revenue at more than VND22 trillion ($1 billion). This was the second consecutive year Bao Viet Life has led the market, holding the Number 1 position in terms of market share of new revenue and total revenue. Bao Viet Life was also named Best Life Insurance Company in Vietnam by the prestigious World Finance magazine.

The non-life insurance sector surpassed its revenue target, reaching nearly VND10 trillion ($438,730). Some businesses grew handsomely and contributed significantly to new insurance revenue, such as motor vehicle insurance (up 29.8 per cent), voluntary health insurance, and fire insurance and special risk insurance (up 24.6 per cent).

The securities sector saw remarkable success in brokerage revenue. The Baoviet Securities Company (BVSC)’s brokerage market share was approximately 5 per cent, up nearly 40 per cent compared to 2016 and putting it in the Top 5 companies with the largest market share on the Ho Chi Minh Stock Exchange (HSX) for two consecutive quarters.

Millennials finding home ownership difficult

Across large parts of the world, Generation Y is struggling to get a foot on the property ladder without help from parents or grandparents, according to Ms. Sophie Chick, Head of Residential Research, Savills Sydney, and Mr. Duong Duc Hien, Director of Residential Sales, Savills Hanoi, who examined the issue from the perspectives of two different markets.

In emerging Vietnam, according to the mid-term Population and Housing survey, the home ownership ratio was 90.8 per cent in 2014, down slightly from 92.8 per cent in 2009. A closer examination, however, indicates that this high ratio is the result of inheritance or significant financial support from the older generation. Mr. Hien believes that without this help, home ownership for under 35s is challenging.

“Admittedly there is a gap between young buyers’ incomes and housing prices in major cities like Hanoi and Ho Chi Minh City,” he said. “A mid-end two-bedroom apartment in Hanoi costs between $140,000 and $200,000, close to the average in developed markets, while the average income in Vietnam is nowhere near the level in those markets.” Family support clearly plays a large role in the financial capacity of young homebuyers in Vietnam.

Housing affordability has become a worldwide issue since the global financial crisis (GFC) a decade ago, partly because mortgage lending has been significantly curtailed by regulation. It is the younger generation, usually needing the highest loan-to-value ratios and loan-to-income ratios, who are most affected.

This has become evident in developed markets. In Australia, the share of homeowners aged 25 to 34 is 45 per cent (it was 58 per cent in 1986); much lower than in Vietnam. In the US, the current rate is 31 per cent for under 35s, against 39 per cent in 1995, while in the UK, only 5 per cent of housing equity is owned by under 35s, who are now paying four and a half times as much in rent to landlords as they are in mortgage interest.

Ms. Chick believes this generational effect goes beyond the GFC and “is symptomatic of how equity has become concentrated in older generations through a history of home ownership, mortgages and price rises.”

“Meanwhile, younger ‘equity have-nots’ find it increasingly difficult to access owner occupation, requiring large amounts of equity to fund rising prices and higher deposits. Generation Y (aka Generation Rent) is having to delay life choices such as marriage and parenthood, and one of the essential requirements to become a home purchaser now is a dual income, despite the low interest rate period seen post-GFC.”

This will be a particular issue for developed economies, but not irrelevant to recently emerging ones such as Vietnam. Ms. Chick expects that the scarcity of equity among first-time buyers and limits to affordability in many Western countries will act as an effective ceiling on house prices and lower price growth will be the result. For Vietnam, Mr. Hien believes this issue will encourage buyers to use financial leverage, which is yet to be common. The growth of Vietnam’s economy in coming years will hopefully increase average incomes and bring them closer to housing prices.

Dinh Vu polyester to officially resume operation on April 18

The Dinh Vu polyester plant is expected to resume the operation of its three manufacturing workshops on April 18, with the first priority of cutting unnecessary expenses during the operation process to limit losses.

Dao Van Ngoc, chairman of the Board of Directors of PetroVietnam Petrochemical and Textile Fiber JSC (PVTex), the operator of Dinh Vu polyester, told Vnexpress that in April PVTex resumed the operation of its three yarn production lines to scrutinise the quality of draw texturised yarn (DTY) and will officially resume the operation of the spinning lines on April 18.

Experts form Germany’s Bamag GMBH, which supplies equipment to the plant, will join and support PVTex to resume operations.

At present, PVTex completed the purchase of materials at competitive prices for manufacturing. In the first month, the plant is expected to manufacture 189 tonnes of yarn.

Previously, at the day of trial operation, Le Manh Hung, deputy general director of PetroVietnam, stated that PVTex has been methodically preparing and the plant will operate with a view to minimise manufacturing expenditures.

The Dinh Vu polyster plant came into commercial operation in May 2014 with a capacity of 236 tonnes of polyester fibre and yarn per day, equalling 48 per cent of its designed capacity. However, the factory had to suspend operations numerous times due to unsold products piling up. It is one of the 12 projects under the Ministry of Industry and Trade incurring trillion-dong losses.

Previously, in September 2017, Reliance Industry Company from India decided to co-operate with PetroVietnam to restart the plant.

Accordingly, Reliance would provide personnel for maintenance, material supply, and sales operations, among others. PetroVietnam proposed the Indian partner to buy PVTex’s shares, but no official information is forthcoming yet.

Besides, PVTex also discussed with domestic partners raising capital to maintain the operations of the plant, while simultaneously collaborating with experts to evaluate the quality of the DTY manufacturing lines.

Leading US infrastructure builder Panduit prepares to enter Vietnam

Panduit, a US-based global provider of network infrastructure solutions, revealed its plan to break into Vietnam next year, as the ASEAN becomes the new manufacturing hub in the entire Asian region.

Chad Reynolds, vice marketing president at Panduit, told VIR that the US firm will open an office in Vietnam in 2019, as the firm strives to capitalise on Vietnam’s growing manufacturing capacity and urgent need for digital infrastructure.

“Vietnam’s rise to be Asia’s manufacturing centre depends on its ability to build up Industry 4.0 and infrastructure for the Internet of Things, using data centres, enterprise and operational network infrastructure that can be developed to accommodate future growth as well as deliver superior performance,” said Reynolds about the growth direction of the Vietnamese manufacturing sector.

According to the representative, Panduit is actively seeking partners and distributors in Vietnam to facilitate its operations here. The US firm has yet finalise details such as investment capital and the timeline of the opening.

Panduit, which provides physical, electrical, and network infrastructure solutions for businesses, has been exporting semi-finished products from Vietnam to other countries for final production. Reynolds revealed that these purchases can reach $10 million a year.

This week, Panduit held a two-day roadshow in Ho Chi Minh City, meeting Vietnamese firms and showcasing its infrastructure solutions to increase efficiency and enhance reliability in various industries, such as education, energy, financial services, food processing, healthcare, railways, and transport/heavy equipment.

“We want to show how our data centre solutions, such as converged infrastructure, creativity solutions, cooling optimization, and thermal solutions, can help companies in Vietnam improve their efficiency,” said Reynolds.

Panduit, headquartered in Tinley Park, Illinois, has been operating since 1955. The US firm runs offices in 112 locations around the world.

Tencent interest to rearrange ride-hailing market?

Didi Chuxing’s joining the Vietnamese market raises questions about how the shared investor Tencent would affect the market, with many raising the example of Softbank’s remarkable impact on Uber and Grab.

China-based ride-hailing player Didi Chuxing is waiting for the Vietnamese government’s approval to start operations in the country, according to newswire Dantri.

Nguyen Xuan Thuy, deputy director of the Transport Department under the Ministry of Transport (MoT), told Dantri that Didi Chuxing submitted the dossiers to MoT, however, the ministry has yet to consider this proposal because it is not a suitable time for Didi Chuxing to enter Vietnam.

At the same time, motorcycle ride-hailing transportation provider Go-Jek from Indonesia has gathered a team of experts to advise its expansion in Vietnam to break the dominance of Grab.

In reality, both Didi Chuxing and Go-Jek have a common backer - Tencent. Notably, Tencent is the strategic investor of Go-Jek, while Didi Chuxing has received substantial financial support from Tencent.

Thus, once Didi Chuxing officially comes into operation in Vietnam, no one can say how the shared investor will affect operations at the two companies—some foresee a level of aberration of free market competition where the two service providers coordinate to minimise friction, similar to how Uber and Grab have decided to separate their spheres of interests around the globe due to their common backer Softbank.

Uber and Grab share a common investor - SoftBank from Japan. The Japanese firm first backed Grab back in 2014, and it recently pumped $2 billion fresh capital into the company alongside China’s Didi Chuxing. In January, SoftBank made headlines with a significant investment into Uber, only a few short months after which Uber has decided to withdraw from Southeast Asian, passing on its operations to Grab.

According to the deal, Grab will integrate Uber’s ridesharing and food delivery business in the region into its existing multi-modal transportation and fintech platform. In the time to come, Grab will take over Uber’s operations and assets in Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.

As part of the acquisition, Uber will take a 27.5 per cent stake in Grab and Uber CEO Dara Khosrowshahi will join Grab’s board. At the same time, Uber will focus on its businesses in the US, Europe, Latin America, and Australia, while Grab will develop the market in Asia-Southeast Asia.

SoftBank has also been a big investor in Uber's rivals across Asia, including Southeast Asia's Grab, China's Didi Chuxing, and India's Ola, as it works to achieve founder Masayoshi Son's vision of a future driven by artificial intelligence and interconnected devices.

According to a source close to Singapore-based Grab, the purpose of investing in these ride-hailing service providers is to keep Softbank's right to change the conversation in case the competition among ride-hailing companies escalates and brings down profit margins.

"SoftBank will play a consolidating role. Simultaneously, SoftBank as a board director in both companies (Uber and Grab) would fundamentally change the conversation," said the source that declined to be named due to the sensitivity of the subject.

Tencent, via its investment in Didi Chuxing and Go-Jek, might be striving to fill a similar role in the market and moderate competition across the board.

Toong opens new co-working space in Ho Chi Minh City

On April 11 Toong, the first co-working space chain invested by Indochina Capital, announced the official launch of its largest facility—Toong Minh Khai in the heart of Ho Chi Minh City.

Located in the heart of Indochina Capital’s economic hub in Ho Chi Minh City, Toong Minh Khai sets a new benchmark for what it means to work and live harmoniously within today’s fast-paced, highly-urbanised cities as Toong continues to rapidly expand its network into Laos and Cambodia, meeting the strong demand of the Indochina’s fast-growing markets.

The newest facility marks the evolution of Toong’s product offerings since 2015 which goes beyond a network of high-quality, inspirational physical workspace.

Putting the human at the centre of the Toong experience, for the first time, a workspace for creators incorporates into its premise a concept store, a specialty coffee lab, and a curated library coupled with exclusively curated soul-nurturing programmes, wellness enhancement, and self-transformation activities customised meticulously for all members.

According to Indochina Capital CEO Peter Ryder, the potential of co-working in Vietnam is enormous and he really believes that this concept in Vietnam is more than a trend for dynamic young people and millenials.

This concept is not for just working but it is a way of future, it is also co-living, co-dreaming, and bring more energy for people in a real community.

Ryder added that the co-working space available through Toong will reach 60,000 square metres at the end of next year from the current 10,000sq.m in Vietnam, Cambodia, and Laos.

Meanwhile, Duong Do, founder and CEO of Toong, said that the company was in the business of nurturing talents and cultivating characters, so people can innovate at their best to serve others and make society better.

“The opening of Toong Minh Khai allows this vision and mission of our organisation to materialise in reality,” Duong said.

Situated on the 2nd and 3rd floors of a landmark printing factory that belonged to Vietnam News Agency, Toong Minh Khai covers a total area of 1,700sq.m.

To transform the space, Toong joined hands with renowned Swiss-based G8A Architects (formerly Group8) to infuse greenery, serenity, and contemporary spirit into the building, yet still keep the original soul of its modernist style intact.

With Toong Minh Khai now officially opened, Toong now operates a total of five locations in Vietnam and is developing four other large-scale locations in four cities in Vietnam, Cambodia, and Laos at the same time.

Khang Dien JSC’s projects appear on MoC’s radar

Khang Dien JSC’s six real estate projects are the latest names on the Ministry of Construction’s list of places to investigate.

Khang Dien JSC’s six real estate projects under investigation include Khang Dien-Phuoc Long B residential area, Mega Residence residential area, Melosa Garden residential area, Thanh Phu Ltd. high-rise residential area, Topia Garden apartment building, and Mega Ruby housing area.

The 10.4-hectare Khang Dien-Phuoc Long (located on Duong Dinh Hoi street, Ho Chi Minh City’s District 9) includes 247 villas and apartments. Currently, the residential area’s land lots are sold out.

The Mega Residence residential area is located in the intersection of Ho Chi Minh City-Long Thanh-Dau Giay Expressway and Ring Road 2. The 3.2ha project includes 160 houses with an area of 160sq.m and many facilities, such as swimming pools, parks, cafés, and minimarts. According to the investor, all houses in the projects’ have been sold.

The 17.3ha Melosa Garden residential area with 500 villas and houses is located in Ho Chi Minh City’s District 9. Khang Dien JSC has co-operated with ViettinBank to offer preferential finance packages to support house buyers. Currently, the project’s villas and houses are coming onto the market.

The 4.4ha Thanh Phuc Ltd. high-rise residential area developed by Thanh Phuc Ltd. and Khang Dien JSC includes 150 villas and houses in District 9.

The 60,194sq.m Topia Garden residential area worth VND22.5 billion with 225 villas and houses in District 9 has recently been completed and is being offered on the market.

The 5ha Mega Ruby residential area with 279 houses in District 9 has already been completed and launched.

Besides, C.E.O Group’s VND10-trillion Sonasea Villas & Resorts project also got on MoC’s radar. The 132ha project received its investment certificate in 2012 and is being constructed.

Accordingly, the project consists of three construction phases from 2012 to 2019, with the first phase constructing 40 per cent of the project’s infrastructure and one beachfront resort, the second phase constructing 60 per cent of the project’s infrastructure and three beachfront resorts, and the third phase constructing the remaining parts of the project.

Previously, MoC’s investigation in 2017 also pointed out violations by Tan Hoang Minh Group, the investor of several apartment building projects in Hanoi, including D’. Le Pont D’Or Hoang Cau, D’. Palais De Louis, and D'. Le Roi Soleil Quang An.

Quang Ninh real estate market draws in $5.5 billion investment

The increasingly improved and synchronised transport infrastructure, tourism potential, and abundant natural resources are all favourable conditions luring in big investors, especially in real estate, to Quang Ninh.

Numerous real estate projects have changed the face of Quang Ninh in the last three years, such as Vinpearl Halong Bay Resort, Vincom Plaza Halong, Vinhomes Dragon Bay, Halong Marina, Green Bay Village, and New Life Tower Halong.

The largest investor in Quang Ninh’s tourism real estate market is Sun Group with the 214-hectare, VND7.8-trillion ($343.4 million) Sun World Halong Complex which has already been put into operation. The group is also developing shophouses and five-star villas and resorts at Sun Premier Village Halong Bay.

FLC Group is also present in Quang Ninh, with a project covering a total area of 224 hectares with a total investment of VND3.4 trillion ($150 million). This building complex includes an 18-hole links golf course, a 1,300-seat international conference centre, a 600-room five-star hotel, a club, an amusement park, villas, and synchronous transport network.

As reported by the Quang Ninh Planning and Investment Department, there are over 100 developed and developing real estate projects with the total investment of over $5.5 billion covering all segments and sectors in the province.

Real estate experts assessed that supply sources are considerable lower than demand. Almost all mid-end and premium apartments have been purchased, with high rates of successful transactions. Various real estate enterprises have been building long-term development strategies focusing on the province.

Quang Ninh is also determined to lure strategic investors to key tourism areas, such as Halong, Cam Pha, Van Don or Uong Bi, as well as complete the Van Don Special Economic-Administrative Zone as the new motivation for provincial growth.

Key transport projects such as the Halong-Haiphong Expressway, Quang Ninh Airport, and Bach Dang Bridge will open in the second quarter of this year. The Van Don-Mong Cai Expressway is expected to be kicked off soon to improve goods circulation and become the main transportation axis of ASEAN.

In 2017, for the first time ever, Quang Ninh topped the Provincial Competitiveness Index (PCI) with a score of 70.7 out of 100 over ten indicators.

Customs office process nearly three million requests online

The Customs sector has processed nearly three million procedure-related requests online, including 2.7 million ones in the first quarter and 230,000 ones in the early days of April. 

So far, 126/178 customs procedures have been provided to at least level 3 in the network environment. Of these, 123 procedures were provided at level 4 (the highest level in online public service in Viet Nam).

In 2018, the General Department of Customs will continue to expand the provision of online public service, at least to level 3 for 42 procedures. Thus, the number of administrative procedures in the Customs sector to be provided at level 3 will increase to 168/178 procedures, equivalent to 94%.

Each year, the Customs sector handled more than 12 million dossiers electronically via the VNACCS/ VCIS Automated Clearance System, Electronic Payment Gateway and HQ36a Online Public Service system. 

Local gold prices keep up with global rise

Domestic gold prices have seen a steady increase since the beginning of this week.

This is in line with the robust growth of global gold prices over worries about the trade war between China and the United States.

At 2pm on April 11, Saigon Jewellery Joint Stock Company (SJC) quoted the buying and selling prices of its gold in HCM City at 36.75 million VND (1,608 USD) and 36.93 million VND per tael, respectively, an increase of some 130,000-150,000 VND per tael compared to April 6.

One tael is equivalent to 1.2 ounces.

This is the third consecutive increase in gold prices this week.

At the same time, Hanoi-based Bao Tin Minh Chau Jewellery JSC increased its buying and selling prices to 36.82 million VND and 36.88 million VND per tael, respectively, up by 180,000 VND per tael against last week.

DOJI Group bought SJC gold at 36.82 million VND per tael and sold it at 36.90 million VND per tael, a rise of 190,000 VND per tael over April 6.

Global gold prices have risen quickly as the US dollar continues to fall.

Gold spot is being traded at over 1,344 USD per ounce on April 11 in the global market, up by some $10 per ounce against April 6.

International experts predict that gold prices could hit 1,400 USD per ounce. Investors, meanwhile, are paying close attention to the trade spat between the two largest economies, which has boosted the precious metal’s appeal.

On the other hand, problems in Russia, Syria and Iran have also made investors anxious, driving up gold prices.

HCM City delegation to promote trade, investment in Cuba

The Investment and Trade Promotion Centre of Ho Chi Minh City (ITPC) will send a delegation to study the market and promote trade and investment in Cuba from April 15-24.

The delegation will include representatives from local producers and exporters in the areas of food processing, consumer goods, construction and services.

Cuba is pursuing more open economic policies with many of old ones amended to be suitable to the global market economy. The country has been boosting trade and calling for investment in an attempt to improve the competitiveness of its economy. 

It has particularly focused on constructing new sea ports and railways, developing information technology infrastructure and reforming metallurgy and mining industries while giving priority to food processing and beverages. 

Cuba wants to export goods like pharmaceutical and biological products and services in tourism and healthcare.

Meanwhile, Vietnam holds advantages in exporting products in textiles and garment, footwear, handicraft, agriculture and aquaculture. The country has been looking for investment in construction, energy, industry, hi-tech agriculture, education, healthcare and tourism

These factors leave enormous potential for enterprises from both sides to satisfy the needs of the Cuban market and to cooperate in trade and investment.

The Vietnamese delegation’s visit to Cuba aims to seek the market for building materials, handicraft products, textile-garment and footwear products, foods, mechanical and electronic products and plastics and at the same time, promote trade and investment between the two countries.

The delegation will introduce to Cuban investors about HCM City’s business climate and some key projects in transportation, infrastructure development, education, healthcare and hi-tech agriculture.

According to Pham Thiet Hoa, ITPC director, trade between Vietnam and Cuba has increased significantly in recent years, but remains modest compared with the potential. The two-way trade amounted to 250 million USD in 2016 with Vietnam’s exports to Cuba accounting for 240 million USD.

Vietnam, Taiwan enjoy marked growth in tourism links

Vietnam welcomed more than 616,000 Taiwanese tourists in 2017, a year-on-year rise of 121.5 percent, according to the National Administration of Tourism. 

The number is expected to hit 800,000 in 2018, Cong Thuong (Industry and Trade) newspaper reported. 

Meanwhile, more than 380,000 Vietnamese tourists visited Taiwan (China) in 2017, up 94.94 percent year-on-year. 

The Taiwanese tourism sector aims to serve some 700,000 Vietnamese holidaymakers in 2018.

The outcomes are attributable to cultural similarities shared by the two destinations, diverse landscapes and cooperation between travel firms of both sides. 

Besides, since a memorandum of understanding on tourism was signed between Vietnam and Taiwan in 2012, Taiwan has issued favourable visa policies to the Southeast Asian nation. 

Taiwan is famous for Ali mountain (Alishan), Sun Moon lake, Orchid Island (Lanyu) and the National Palace Museum, together with its culture and cuisine.

Tra Vinh farmers supported in joining large-scale field model

Cooperatives and alliances of cooperatives in the Mekong Delta province of Tra Vinh will get financial support when joining the large-scale field model, which is being implemented in the locality. 

The provincial People’s Committee has issued a support policy, which aims to encourage local farmers to participate in large scale cultivation and cooperatives for improving the efficiency of agricultural production. 

Under the policy, farmers who are growing rice, fruit trees, and coconuts will be provided with 840,000 VND (36.9 USD)/ha for the first crop and 560,000 VND (24.6 USD)/ha for the second crop.

Meanwhile, those planting corn, potato, cassava, and short-term industrial crops will receive 690,000 VND (30.3USD)/ha for the first crop and 460,000 VND (20.2USD)/ha for the second crop.

Farmers join the large-scale field model will also receive subsidy of 30 percent of seed or sapling costs for the first crop.

Tran Trung Hien, Director of the provincial Department of Agriculture and Rural Development said the large-scale field model and the formation of cooperatives aim to build concentration high-quality cultivation areas, towards reducing production costs, increasing profits, and expanding consumption markets for local farm produce. 

The scheme also helps local farmer access the State’s support policies related to science and technology, and investment capital. 

The model has proven effective in Tra Vinh. In the 2017-2018 winter-spring crop, it helped bring an additional profit of 5 million VND/ha for farmers compared to rice farming on small scale.

However, farmers are hesitant to join the model due to concern over the sale of products. 

Ha Giang inaugurates organic tea plant using Japanese high-tech

An organic tea production plant using the latest Japanese technology was inaugurated in Tan Lap commune, Bac Quang district, the northern mountainous province of Ha Giang on April 12.

The 4,500-square-metre plant was built at a total cost of more than 30 billion VND (1.32 million USD) by Hoang Long Tea Co., Ltd. Equipped with an automatic production line, the plant is capable of processing 40 billion tonnes of fresh tea per day, which helps consume material tea in Tan Lap commune and other regions in the vicinity.

At the inauguration ceremony, Vice Secretary of the provincial Party Committee Nguyen Manh Dung noted that tea is seen as a spearhead plant in the province’s agricultural economic development plan.

Hoang Long company is one of the leading firms in developing tea material zones and promoting connections with local farmers to ensure effective tea cultivation, he said, urging the firm to continue its efforts to improve product quality and income for tea growers.

Ha Giang province will direct branches and districts to zone off tea processing areas to develop safe tea in line with organic standards, he stressed.

For his part, Director of Hoang Long Tea Co., Ltd Nguyen Duc Lai noted that the company always pays attention to deploying technology in tea production to bring clean and top-quality products to consumers.

The company’s black tea and green tea is favoured by both domestic and foreign customers, he added.

Earlier in 2002, the company constructed a tea plant in Hung An commune, Bac Quang district with total capacity of 50 billion tonnes of fresh tea per day.

Garment-textile sector targets green production

Green, clean, energy-saving production is urgent to improve competitiveness of Vietnam’s garment-textile enterprises as each year the sector spends up to 3 billion USD on production energy, heard a workshop in Ho Chi Minh City. 

Vu Duc Giang, Chairman of the Vietnam Textile and Apparel Association, said Vietnam’s garments-textiles are under the pressure of price, production cost, environmental safety and labourers’ health.

Commitments to corporate social responsibility have been also mentioned in articles of free trade agreements to which Vietnam is a signatory, he stressed. 

Joerg Bauersachs, general director of Tal Apparel Limited’s dyeing factory, said since 2009, his factory has applied energy-saving solutions, helping cut 26 percent of emissions and 36 percent of water used in production. 

Nguyen Thanh Ha, a representative of the State administration for comprehensive growth project of the US Agency for International Development (USAID), said the problem lies with how to reduce emissions and waste water. 

He also underlined the need for enterprises to revamp their production processes towards international standards for emissions, waste and waste administration. 

The USADI has partnered with the Vietnamese Ministry of Industry and Trade (MoIT) to improve garment-textile firms’ energy-saving capacity, while helping them access loans to carry out energy-saving projects, he said. 

According to Hoang Van Tam from the MoIT said an alliance of sustainable garment-textile firms is expected to officially make its debut in Vietnam in June 2018, assisting the businesses in improving production environment and cutting pollutants.

Foreign investors eyeing notorious Chu Lai Soda processing plant

Numerous investors, including foreign investors, intend to invest in the suspended Chu Lai Soda processing plant invested by Chu Lai Soda Processing JSC, despite its debts exceeding VND3 trillion (US$131.58 million).

This is part of a report the Quang Nam People’s Committee submitted to the prime minister.

According to the report, Chu Lai Soda has increased co-operation with banks to find a way to resume the plant’s operation as soon as they can.

Representatives of Chu Lai Soda and banks to which Chu Lai Soda owes money, arrived to China to join a working session with China Tianchen Engineering Corporation (TCC) and another Chinese firm to discuss plans to resume the plant.

According to the Quang Nam People’s Committee, at the date that the plant came into pilot operation, numerous technical problems had yet to be surmounted, causing the consecutive environmental incidents.

The investor failed to resolve the technical problems because it ran out of investment capital and failed to collect added capital from partners. As a result, it was forced to suspend the plant.

To date, along with the debt of VND2 trillion (US$88.1 million) owed to banks and the debt of VND6 billion (US$263,170) in unpaid salary to workers, it shoulders more than VND40 billion (US$1.75 million) in additional debts.

Besides, to date, Chu Lai Soda paid only VND292 million of the two VND960 million (US$42,107) it was issued in fines due to discharging untreated wastewater into rivers.

Furthermore, it only paid VND8 billion (US$350,893) of the land rental fee of VND54 billion (US$2.36 million).

Established in 2011, Chinese-invested Chu Lai Soda’s Quang Nam factory has the total investment capital of US$120 million. The 60-hectare factory specialises in manufacturing heavy and light soda products, which serve as material to manufacturing glass, construction glass, pulp, and paper.

Savills says Vietnam youth is easier for housing affordability

While in many other countries generation Y (born from 1981 to 1991) is struggling to get a foot on the property ladder without help from parents or grandparents, youth in Vietnam has been inheriting or receiving significant financial support from the older generation, according to experts from Savills.

Duong Duc Hien, director of Residential Sales, Savills Hanoi, believes that without this help, home ownership for under 35s would be challenging.

“Admittedly there is a gap between young buyers’ income and housing prices in big cities like Hanoi and Ho Chi Minh City. A mid-end two bedroom apartment in Hanoi costs US$140,000-200,000, close to developed markets’ average, while the average income in Vietnam is nowhere near,” said Hien.

According to the results of the mid-term Population and Housing Survey, the home ownership ratio was 90.8% in 2014, slightly dropping from the 92.8% in 2009.

However, a closer examination indicates that this high ratio is the result of inheritance or significant financial support from the older generation.

According to Sophie Chick, head of Residential Research, Savills Sydney, housing affordability is a particular issue in developed economies, but not irrelevant to recently emerged ones, such as Vietnam.

Chick expected that the scarcity of equity among first-time buyers and limits to affordability in many Western countries will act as an effective ceiling to housing prices resulting in lower price growth.

Meanwhile in Vietnam, Hien believed this issue will encourage buyers to use financial solutions, which are yet to be popular. The growth of the Vietnamese economy in the coming years will hopefully increase the average income and bring it closer to housing prices.

Housing affordability has become a worldwide issue since the global financial crisis, partly because mortgage lending has been significantly curtailed by regulations. It is the younger generations, usually needing the highest loan-to-value ratios and loan-to-income ratios, who are most affected.

In developed markets, this has become evident. In Australia, the share of homeowners aged 25 to 34 is 45%. In the US, the current rate is 31% for under 35s, while, in the UK, only 5% of housing equity is owned by the under 35s, who are now paying four and a half times as much in rent to landlords as they are in mortgage interest.

Chick added that this generational effect goes beyond the financial crisis and “is symptomatic of how equity has become concentrated in older generations through a history of home ownership, mortgages, and price rise."

Poultry breeding heats up again, Nationwide rice exports hit 1.36mln tons, Vietnam Australia mark 25 years of agriculture cooperation, Bao Viet Holdings' 2017 net profit up 37%
 
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