BUSINESS IN BRIEF 11/4

PM to address business concerns this month

Prime Minister Nguyen Tan Dung will hold a dialogue with the business community in late April to address their concerns, according to the Vietnam Chamber of Commerce Industry (VCCI) President Vu Tien Loc.

The forum, to be jointly hosted by the VCCI and the Government Office, will offer the business community a chance to come up with firm recommendations to ease difficulty and facilitate their operations.

Loc says developing the private business sector is considered the driving force in fuelling economic growth. However, businesses, especially small and medium-sized, are encountering difficulty in accessing development resources, including capital, market, and lack of incentives from the government.

Before 2006 the dialogue between the Prime Minister and businesses had been held annually and become an important forum on the business and investment environment.

Realising the importance of the business community in national economy, the Party’s Political Bureau issued a resolution in late 2011 on building and bringing into full play the role of Vietnamese entrepreneurs in the process of national industrialisation and modernisation, as well as international integration.

Hai Duong attracts biggest FDI project nationwide

The northern province of Hai Duong has licensed a Dai An Vietnam-Canada International Hospital project with total registered capital of US$225 million - the biggest foreign direct investment (FDI) project in Vietnam in the first quarter of 2014.

The Canadian-invested project aims to build a general hospital and provide healthcare services to local people.

Hai Duong has granted investment licenses to 8 new and 6 operational FDI projects with a combined registered capitalization of US$319.4 million during the past three months.

The province expects to lure US$450 million in FDI, including US$300 million from newly licensed projects, and disburse US$200 million this year.

Vietnam, Cambodia promote border trade

An estimated 10,000 visitors, organizers and exhibitors from bordering areas of Vietnam and Cambodia gathered on the opening day of a trade fair in Long Binh town, An Giang province on April 9.

The annual fair, which takes place from April 9-14, has attracted roughly 100 businesses from An Giang, the Mekong Delta region and Ho Chi Minh City, who have carefully set up stalls showcasing their  wares, including consumer products, agricultural machines, plant varieties, utensils, electronics, and handicrafts.

The fair provides a chance for businesses from both countries to tout their wares and seek opportunities to promote transborder trade and investment, especially tourism, to fully exploit the economic potential of the region surrounding the Khanh Binh national Border Gate.

This year’s event is taking place to coincide with the Hung Kings festival and Chol Chnam Thmay Traditional Festival of Khmer ethnic minority people.

Earlier in 2014, construction of a US$40 million Long Binh - Chary Thum bridge, linking Vietnam’s An Giang province and Cambodia’s Kandal province, was completed and the bridge was opened to traffic.

The bridge, a joint project of Vietnam and Cambodia, boosts trans-border trade by reducing costs and increasing timeliness, opening up a new horizon for border trade between the two countries.

Tea exports dip in Quarter 1

In the first quarter of the year, Vietnam exported 24,000 tonnes of tea valued at 37 million, representing a decrease of 15.4% in volume and 13.8% in value compared to the same period of 2013.

In March alone the country shipped 8,000 tonnes, generating US$11 million in revenue, according to Ministry of Agriculture and Rural Development (MARD) statistics.

Tea exports to Pakistan – Vietnam’s largest tea consumer - experienced a slight decline of 13% in volume and 1.7% in value.

The average export price of tea in the first two months was US$1,597/tonne, up 4.92% from a year earlier.

Despite the modest fall in exports for the quarter, government economists remain optimistic on tea exports for 2014.

The Vietnam Tea Association (Vitas) forecast Vietnam will export 138,000 tonnes of tea this year to earn US$222 million – substantially equivalent to last year’s figure.

Vietnamese food introduced at Singapore fair

Thirty Vietnamese businesses and joint ventures are taking part in the 19th Food & Hotel Asia Fair (FHA 2014), which kicked off in Singapore on April 8.

The biennial event, the biggest of its kind in Asia, offers a chance for participating businesses to promote their products as well as seek partners.

Doan Minh Vu, Director of Topcake – a joint venture between Vietnam, Australia and the Philippines - said that together with Japan, Thailand, Myanmar and Cambodia, Singapore is a major importer of Topcake products.

Attending the fair will help the company approach new partners in Asia, Europe and America and reach 100 billion VND (nearly 5 million USD) in export value this year, stated Vu.

The FHA 2014 is attracting the participation of more than 3,000 leading companies in food and hotel services from 64 countries and territories.

A cooking competition and seminars on the latest trends in the food and hotel industries will be held on the sidelines of the fair, which will open until April 11.

Nghi Son EZ authority seeks capital sources for infrastructure development

The Nghi Son Economic Zone (EZ) in central Thanh Hoa province has struggled to attract investment after receiving significant support during recent years, local authorities have said.

During a meeting late last week, the provincial People's Committee vice chairman Nguyen Dinh Xung said poor planning, inadequate infrastructure and lack of land for service and petrochemical sectors were major obstacles preventing the province from attracting investors.

Xung said local authorities had assigned the Nghi Son EZ Authority to draw up plans to mobilise domestic and international capital sources for infrastructure development between 2014-17.

He also said prioritised investments by the State were vital to the EZ's development in addition to efforts by local authorities.

The Nghi Son EZ covers an area of more than 18,600ha, with most factories focusing on heavy industry, basic industry and the Nghi Son seaport, said the head of the EZ Authority, Tran Hoa.

As of October last year, the EZ had attracted 74 investment projects, including 66 domestic projects with a total registered capital of 93 trillion VND (4.43 billion USD) and eight foreign projects worth 12.1 billion USD.

However, Xung said the investments were still in the early stages and were modest in spite of preferential policies on land and tax. He suggested that many investors had been unaware of these incentives when deciding the scope of their investment in the EZ.

Investors in the zone have received tailored incentives, including exemptions for land and water taxes for up to 15 years after the start date of operations, and corporate tax exemptions for four years.

"We provide all the necessary administrative procedures at the zone to help investors succeed," Hoa said.-

Quang Ngai calls for more investment in industrial zone

Quang Ngai, the central province in Vietnam, will further develop its industrial sector in a bid to attract more investment in the coming period, stated a provincial official.

During an online dialogue with the Cong thuong newspaper regarding the development of the industrial sector in Quang Ngai held in Hanoi on April 8, Pham Nhu So, the vice chairman of the People's Committee of Quang Ngai province and the head of the management board at Dung Quat Economic Zone, noted that after 15 years of development, the Dung Quat Economic Zone has promoted economic development in the province and is considered one of the most successful and swiftly developing economic zones in Vietnam.

The economic zone has attracted 113 projects with a total registered capital of 8.5 billion USD and disbursed capital worth 5 billion USD for 73 projects operating in the zone.

The first heavy industrial centre of Vietnam was developed at the Dung Quat Economic Zone and has plants of oil refinery, thermo-electric, steel, plastic package, ship building, biofuel, paper and cement, and a system of ports and industrial services.

Last year, the total value of industrial output and commercial services in the Dung Quat Economic Zone reached 130 trillion VND (6.19 million USD).

Therefore, the province has invested heavily into infrastructure at industrial zones and economic zones and has targeted to achieve a growth rate of 17-18 percent each year in the industrial sector by 2015, So remarked.

Quang Ngai plans to expand some existing economic zones to attract 5 billion USD more in investment capital to the industrial zone, he added.

The province has hired a Japanese consulting company to review a plan of the Dung Quat 2 deep-water port to further develop its industrial sector.

A Singaporean group has conducted an investment study in the province in order to build an electric project with a total investment of 2 billion USD and a Japanese investor also has a plan for building a steel factory, So added.

Tran Dinh Thien, the director of Vietnam Economic Institute, stressed that Quang Ngai is one of the most attractive places for investment in the central region. According to the provincial competitive index (PCI) in Vietnam, Da Nang in the central region ranks first, followed by the Thua Thien-Hue province, and Quang Ngai ranked seventh. To reach those places, the city and provinces have policies to improve the business and investment environment.

The Quang Ngai province has the advantage of having deep-water ports, attractive investment incentives, and has restructured its economy to attract more investment, Thien claimed.

Ryuhang Ha, the general director of Doosan Vina Company, emphasised that the company has chosen the Dung Quat Economic Zone to develop its project of producing heavy industrial equipment for the sector of electricity, water, and chemical treatment, since the zone offers favourable conditions in providing services related to deep-water ports that the company needs.

Dung Quat offers fast site clearances and investment incentives for enterprises, including corporate tax and individual tax, he reported.

Vu Quang Vinh, the senior marketing director of Vietnam-Singapore Industrial Park (VSIP), stated that VSIP has invested in Quang Ngai for developing an industrial park because the province is an ideal place for manufacturing products for the markets in north and south Vietnam, Laos, north-eastern region of Thailand, and Cambodia.

Nguyen Manh Quan, the head of the heavy industrial department of the Ministry of Industry and Trade, remarked that Quang Ngai has a geographical disadvantage, but its heavy industrial sector has developed and has large projects because the province has created conducive conditions in infrastructure, policies, and administrative procedures.

Businesses urged to tap VN e-commerce market

No enterprise has obtained the dominant position in the e-commerce market in Vietnam, which means that great opportunities are still awaiting new comers, according to an article published on the English language news website VietNamNet Bridge.

A report of PwC showed that the most popular business models now in Vietnam are e-marketplace and e-retailers.

However, no enterprise is in the dominant position like Amazon in the US or Taobao in China. This can be the great opportunities for the newly arrived businesses to cement their high positions in the potential market.

According to PwC, the total value of the Vietnamese e-commerce market reached 300 million USD in 2011. Especially, the expected growth rates are very high, at 75 percent per annum in 2011-2015 which would allow the turnover to reach 2.8 billion USD by 2015.

Vietnam is a country with a young population who are willing to spend money on non-essential goods items.

It is expected that the number of internet users would rise from 30 million in 2011 to 37 million by 2016, according to BMI. Meanwhile, the rapid development of high-speed internet services would help internet users more easily access online shopping services.

The report of the Vietnam E-commerce Association (VECOM) showed the strong development of the ways of online transaction B2B and B2C. It also pointed out the higher efficiency in businesses’ email using. 83 percent of businesses got orders via emails, higher than the 70 percent in 2012.

Search engines and e-newspapers continued to be the tool used by most enterprises (43 percent and 40 percent, respectively).

Social networks have also been favoured to advertise manufacturers’ and distributors’ websites, while the number of businesses using the tool (37 percent) is nearly equal to the percentage of businesses advertising on e-newspapers.

However, VECOM has noted that 15 percent of businesses still did not use any method to advertise their websites. 12 percent of enterprises join e-trading floors in 2013, of which 33 percent said this brought high efficiency.

According to Nguyen Dac Viet Dung, the owner of Sendo.vn, an e-trading floor, Vietnam has great potentials for the e-commerce development.

“We obtained the high growth rate of over 50 percent a month in the last two months,” Dung said.

“We deliver goods in 53 provinces and cities nationwide, which shows that shopping online has become a consumption habit of the Vietnamese,” he added.

The proverb “early bird can catch the worm” proves to be not absolutely true in the Vietnamese e-commerce market.

Vu Hai Nam, the business director of a web retailer, noted that it is the younger retailers who have great competitive edge in the market, because they can provide new experiences to the people who have got used to hunting for goods online.

He went on to say that new comers always bear the hard pressure because they have to compete with the elder web retailers. However, this allows them to avoid the mistakes the elder retailers once made.

Nam’s website, for example, follows a specific way to develop his business. The website only provides the products with the well known brands, with limited orders.

Mekong Delta tasked with ensuring food security

As the nation’s key rice producer, the Mekong Delta has been tasked with ensuring the country’s food security, according to the Southwestern Steering Committee.

From now to 2030, the region is growing rice on an area of 1.8 million ha, more than half of which is for export. It is also striving to maintain an annual output of 24-25 million tonnes of rice.

Coastal provinces in particular will apply a model that combines rice cultivation and fish and shrimp breeding on an area of 200,000 ha in the future.

They plan to use more than 110,000 ha of land for growing maize and soya bean to supply materials for the domestic processing industry.

Local authorities and scientific agencies have worked together to create new high yielding varieties that are able to adapt to climate change and are disease resistant.

They have also promoted the mechanisation of farm work, popularised sustainable farming techniques, and expanded areas for clean rice, altogether to cater for the increasing demand on local consumption and export.

From 2015 onwards, the region plans to multiply cultivation under the Good Agricultural Practices (GAP) standards to achieve at least 40 percent clean rice, as well as reform technology to generate high returns from processed rice products.

According to the Ministry of Agriculture and Rural Development, total rice consumption will be increased to 35 million tonnes by 2020 and 37 million tonnes by 2030 as the nation’s population is estimated to rise to 100 million and 110 million respectively.

The Mekong Delta region comprises of 12 provinces and a centrally-run city with a total area of 40,000 square kilometres and a population of 18 million.

Rubber group opens new representative office in Laos

The Vietnam Rubber Industries Group (VRG) has inaugurated its new representative office in Laos, aiming to strengthen the cooperation efficiency between the firm and local partners.

Addressing the launching and licence granting ceremony on April 10 in Vientiane, Bounthavi Sixouphanthone, Lao Deputy Minister of Planning and Investment, pledged to create all possible conditions for the office to operate effectively.

Tran Ngoc Thuan, VRG General Director, thanked the Party, State and people of Laos for supporting the firm’s investment in the country, contributing to speeding up poverty reduction in Laos, upgrading the infrastructure system and improving the living conditions for locals in the group’s project sites.

He tasked the office to well perform its role as the face of a major Vietnamese state-run group in the host country, helping consolidate the special relations and comprehensive partnership between Vietnam and Laos.

Trade fair helps boost commerce with Cambodia

As many as 100 businesses from the Mekong Delta are featuring their products at a border trade fair underway in southern An Giang province, seeking trade opportunities with Cambodian partners.

The week-long Khanh Binh border gate fair attracted some 10,000 residents living along the border between An Giang and the Cambodian province of Kandal on its first day on April 9.

A wide range of consumer products, handicrafts, and goods for agricultural production are on display at 100 pavilions.

Co-organised by the An Giang Trade and Investment Promotion Centre and the Saigon Investment Promotion and Cultural Development Company (Saigon IPC), the event aims to fully exploit the economic potential of the Khanh Binh border gate.

At the beginning of this year, the two Governments kick-started the construction of a 40 million USD bridge to connect An Giang with Kandal. Once finished, the work will help further enhance economic development in border areas and two-way trade.-

FDI to increase despite sharp decline in first quarter

Foreign direct investment (FDI) in Vietnam in the first three months of this year accounted for only 50.4 percent of that recorded in the same period last year. However, experts said that it was too early to say that FDI would reduce in 2014, the Vietnam Economic News reported on April 10.

According to the latest statistics from the Foreign Investment Department under the Ministry of Planning and Investment, Vietnam attracted 3.334 billion USD in FDI in the first quarter of this year accounting for 50.4 percent of figure recorded a year ago.

The investment capital comes from 252 new projects with total registered capital of 2.046 billion USD (accounting for 64.1 percent of what a year ago) and 82 ongoing projects which increased their capital by 1.287 billion USD (39.3 percent).

The Foreign Investment Department said that the decline in FDI in the first quarter of this year was because Vietnam gave investment licences to several very large projects in the first quarter of last year such as the Samsung Electronics Vietnam Thai Nguyen Co. Ltd.’s 2 billion USD project and the Nghi Son Oil Refinery Co., Ltd.’s project in the Nghi Son Economic Zone in Thanh Hoa Province which increased its capital by 2.8 billion USD. However, Vietnam did not attract such large projects in the first quarter of this year.

Specifically, the largest FDI projects registered in the first three months of this year have investment capital of just over 200 million USD each. For example, the Canadian-invested Hai Duong-based Dai An Vietnam-Canada International Hospital Co. Ltd. project has capital of 225 million USD. The Japanese-invested Binh Duong-based Wonderful Saigon Electrics Co. Ltd. project has increased its investment capital by 210 USD million manufacturing and assembling semiconductor equipment. The Hong Kong-China-invested project to build apartments and shopping facilities in Ward 22, Binh Thanh district, Ho Chi Minh City, has total investment capital of more than 200 million USD.

Although FDI in the first quarter of this year fell sharply from the same period last year, Foreign Investment Business Association Deputy Chairman Nguyen Van Toan said that the decline did not reveal anything as businesses were busy making financial reports in the first quarter of the year and would really begin strong investment in the second quarter.

FDI projects disbursed 2.85 billion USD in the first quarter of this year, a 5.6 percent increase from a year ago. Foreign businesses have invested in 15 areas in the country. Of these, the processing and manufacturing sector has received the largest amount of new and supplementary capital (2.332 billion USD) accounting for 69.9 percent of total FDI registered capital.

International organisations also said that the Vietnamese investment environment had obviously improved and that foreign investors had increased their confidence in the Vietnamese investment environment.

A recent report from the Japan External Trade Organisation (JETRO) indicated that 70 percent of Japanese businesses which were operating in Vietnam wanted to expand their production in the country compared with 66.2 percent in Thailand, 58.1 percent in the Philippines, 54.2 percent in China and 51.6 percent in Malaysia.

Similarly, the European Chamber of Commerce’s 14th survey of European businesses in Vietnam, regarding the business competitiveness index (BCI) in the first quarter of this year, showed that European business confidence in the Vietnamese investment environment increased by nine points to 59 points against the last quarter of last year. The survey revealed that 78 percent of European businesses in Vietnam said that they would increase their capital in Vietnam in the near future.

In this light, the sharp decline in FDI in the first quarter of this year does not mean that FDI in Vietnam would drop in 2014.

Government facilitates OV businesses: investment minister

Businesses run by Vietnamese people in Germany have been asked to invest more into their homeland and to strengthen connections with Vietnamese partners to boost exports to Germany, as the Vietnamese Government is simplifying administrative procedures in order to facilitate investment.

Minister of Planning and Investment Bui Quang Vinh said this at a meeting with the Vietnamese Embassy’s staff and representatives from the overseas Vietnamese business community in Germany on April 8 as part of his visit to the European country.

He said that Vietnam will continue to issue and adjust laws on private and public investment, enterprises and technology transfer.

According to the minister, the country is striving to stabilise its macro-economy, curb inflation, increase competitiveness, intensify economic restructuring, and reform growth by raising labour productivity and product quality.

The equitisation of State-owned enterprises and the restructuring of private ones are creating attractive investment opportunities for foreign companies, including overseas Vietnamese businesses in Germany, stated Vinh.

During the meeting, the minister also answered businesses’ queries on public investment, potential in agriculture and farm produce processing, and issues related to environmental protection, safety in building nuclear power plants, and intellectual property rights.

There are now more than 8,000 small- and medium-sized enterprises run by Vietnamese people and those of Vietnamese origin in Germany, mainly operating in trade, services, tourism, insurance and food processing.

Central Highland provinces eye power grid completion

The Central Highland provinces of Dak Lak and Dak Nong are aiming to complete the construction of a 500kV power grid by April 30.

The electricity line, the 500kV Pleiku-My Phuoc-Cau Bong, runs through Ho Chi Minh City, the southern provinces of Binh Phuoc, Binh Duong, and the Central Highland provinces of Gia Lai, Dak Lak and Dak Nong.

In order to ensure the process, Dak Lak authorities have been creating the best possible conditions to facilitate building work.

Meanwhile, on April 9, a delegation from the Electricity of Vietnam held a working session with Dak Nong provincial People’s Committee to solve existing shortcomings and carry out measures to speed up land clearance and compensation work for households to be relocated.

Once completed, the 437-km network will increase the electricity back-up capacity for the Central Highland and southern regions of the country.

It will then boost power connectivity throughout Vietnam, Laos and Cambodia after 2015.

The project has a total investment of 9.3 trillion VND (437 million USD), funded by the Asian Development Bank (ADB), the Bank for Industry and Trade (Vietinbank), the Vietnam Development Bank (VDB) and other financial sources.-

Mekong Delta agriculture production plan approved

Localities in the Mekong Delta region have set a target of reaching an annual rice and aquatic product output of 24.5 million tonnes and 3.5 million tonnes respectively by 2020.

The target was defined in the rural agriculture development plan to 2020, with a vision to 2030, approved recently by the Ministry of Agriculture and Rural Development.

According to the plan, the region aims for every 1 hectare of cultivated land to field 130 million VND (6,110 USD) and every 1 hectarte of aquaculture farm, 250 million VND (11,750 USD) by 2020.

The plan also said it is necessary to minimise the transformation of agricultural land into non-agricultural one in order to ensure a rice land area of 3.25 million in 2020.

Promotion of regional links are also a focus, while fairs and exhibitions to introduce agro-forestry-aquatic products will also be organised regularly.

The Mekong Delta region – the country’s largest rice granary - comprises of 12 provinces and one centrally-run city with a total area of 40,000 square kilometres and a population of 18 million.

More hydropower plant put into operation

The Vinh Son 5 Hydropower Plant in the central province of Binh Dinh was officially put into operation on April 9 after three months of trial run.

Construction on the plant started in 2009 and completed in late 2013.

Built at a cost of about 900 billion VND (42.3 million USD), the plant comprises two turbines with a total capacity of 28 MW. It is expected to contribute 90-100 million kWh of electricity to the national grid each year.

The plant’s full operation will help increase the country’s power source and improve local people’s living conditions.-

Q1 budget revenue: positive signs for rest of year

State budget collection in the first quarter of 2014 recorded a significant increase of nearly 16 percent over the same period last year, creating favourable conditions to implement budget spending, ensure a balanced budget and maintain macroeconomic stability.

General Director of the General Department of Taxation Bui Van Nam told Nhan Dan (People) newspaper that frst-quarter budget collection in 2014 saw a substantial increase compared to the same period in recent years which were affected by economic difficulties and sluggish growth.

The domestic collection in the first quarter of this year was recorded at nearly 134 trillion VND (6.2 billion USD), equivalent to 24.8 percent of the annual estimate and 16.5 percent higher than the same period last year. It was also the highest first-quarter revenue in the past three years.

Nam attributed the robust results of Q1’s domestic revenue to the close and effective coordination between central and local authorities. The results represent the sound leadership of the Government, the directions of the Finance Ministry and the efforts of tax authorities who strengthened budget collection measures early this year to prevent tax pileup in the middle and end of the year.

The finance sector has also implemented several new policies that have helped increase budget revenue - for instance, the fines collected from traffic safety violations, collection from accrued corporate income and others.

The increase in revenue may also be attributed to tightened inspection and supervision of budget collection, VAT refunds, transfer pricing, e-commerce business, online business and so on. In the first two months of this year, nearly 5,500 enterprises were inspected, resulting in an additional 1 trillion VND (47 million USD) paid to the state budget. The implementation of such comprehensive measures has brought about positive budget revenue results in the first quarter.

The tax official said in the remaining quarters of 2014, tax authorities at all levels will continue undertaking measures that have proven effective and that are aligned with the guidance of the Government, Finance Ministry and local authorities.

Debt management and tax debt enforcement will be tightened to prevent the arising of new tax debts. Taxation agencies will carry out new policies to facilitate enterprises in accumulating capital for production and business activities in order to nurture these sources of revenue. At the same time, tax violations will be handled strictly to prevent losses to the state budget, contributing to increasing revenue in a sustainable way.-

Thai Nguyen heeds centralised agricultural production

The northern province of Thai Nguyen has supported local farmers to build more than 50 large-scale centralised production models, as part of the 2014-2015 programme on building new-style rural areas.

The models, worth over 3.6 billion VND (169,200 USD), aim to help the beneficiaries create high-yield farm produce such as grain, vegetables, tea and red-flesh dragon fruit that meet the Vietnam Agriculture Practice (VietGAP) standards .

Local farmers have also registered for implementing 25 projects worth over 70 billion VND (3.3 million USD) utilising new cutting edge technology for cultivation.

Provincial authorities have prioritised investment into projects for products that are the locality’s strength and high economic value.

Latest statistics show that 90 percent of the local communes have upgraded their irrigation systems, while 70 percent improved their per capita average income, and 18 out of the 20 communes gained access to clean water.

Building infrastructure and public works, improving production capacity, protecting the landscape and environment, and promoting local traditions and cultural identities are among the criteria in building new-style rural areas initiated by the Government in 2010.

Vietnam, Bulgaria share experience in recycling used oil

The Vietnam National Oil and Gas Group (PVN) and Bulgarian company Prista Oil held a symposium in Hanoi on April 8 exchanging experience in managing and treating used oil.

PVN General Director Do Van Hau said almost all countries around the globe have issued strict regulations regarding the treatment and recycling of used oil. In the US, some 1.4 million cubic metres of such oil are collected and recycled every year to fuel over 50 million vehicles.

He pointed to the fact that Vietnam has only released rules on collecting and recycling used products in general. Meanwhile, the work on used oil is still done spontaneously using old methods, causing safety, quality and environmental concerns.

According to Nguyen Xuan Son, General Director of the Petro Vietnam Oil Corporation (PV Oil), Vietnam’s oil market is assessed to have great potential. However, many difficulties remain due to a shortage of legal corridors.

The country also lacks experience in the management, collection and recycling of used oil, he added.

At the symposium, Prista Oil Managing Director Danko Pavlov said the licence for companies to collect and treat used oil is controlled by stern regulations in Bulgaria.

Before licensing, managerial agencies have to inspect the firms’ capacity and make sure their operations meet the standards of both Bulgaria and the EU.

The country also assigns local authorities to promote the recycling of used oil, he noted.

At the event, in the presence of visiting Bulgarian Prime Minister Plamen Vasilve Oresharski, PV Oil Lube – a subsidy of PV Oil - and Prista Recycling - a division of Prista Oil - inked a cooperation memorandum of understanding.-

Vietnam-Bulgaria business forum held in Da Nang

The Vietnam-Bulgaria Business Forum opened in the central city of Da Nang on April 8, in the presence of Bulgarian Prime Minister Plamen Vasilev Oresharski, who is making a visit to Vietnam from April 6-9.

The PM said the forum, which was jointly held by the Bulgarian Embassy in Vietnam and the Da Nang-based Vietnam Chamber of Commerce and Industry, offered a chance for businesses of the two countries to set up multifaceted cooperation ties in a more effective manner.

The attendance of 23 Bulgarian companies and 50 Vietnamese businesses based in Da Nang in the event shows their interest in seeking investment chances in either country, according to the PM.

In the context of the global economic crisis, the Bulgarian economy is still developing, proving its stability, he said, adding that the country always considers Vietnam as an important partner.

PM Oresharski also said he believes that after the event, bilateral ties will see bright prospects, especially in the issues of common concern.

Earlier the same day, the city’s leaders met with the Bulgarian PM.

While briefing the guest of the city’s socio-economic achievements and its preferential treatment to foreign investors, Chairman of the municipal People’s Committee Van Huu Chien expressed his hope of building close connections and cooperation with Bulgarian partners in many fields, especially trade, investment and tourism.

The city’s authorities pledged to support and create the most favourable conditions for Bulgarian businesses to invest in Da Nang .

For his part, PM Oresharski said he hopes Vietnam and Bulgaria , which possess fine traditional relations, as well as Bulgarian localities and Da Nang , will develop long-term cooperation in all sectors.

PM Oresharski and his spouse visited Hoi An ancient town the same day.

Investors rush to lower luxury house prices

Many villa projects in Hanoi are being sold at surprisingly low prices amid the slump in the market when their investors want to clear out the stocks.

Numerous leaflets are being posted on the streets to advertise home selling. If a luxurious house in urban projects was offered at tens of billions of VND a few years ago, a 200 square metre luxurious house is sold at only VND1.6 billion. Even so, many people still said the price is a bit high compared to the next-door projects.

Song Da Urban and Industrial Zone Investment and Development JSC has also lowered the prices for many of its properties. Price for a square metre of land in the Nam An Khanh urban project has been lowered from VND50 million to VND17-21 million. However, home buyers have not moved in yet because the infrastructure is incomplete.

Director of Commercial Real Estate Services (CBRE) Le Minh Dung said housing prices in general are dropping. Reports from CBRE said due to the economic difficulties and redundancy of housing projects, luxurious houses' investors are pushing down the prices in order to compete with the middle class housing sector.

According to the Ministry of Construction's statistic, as of late February, the total value of unoccupied houses in Vietnam reached over VND92.6 trillion of which VND9 trillion is in Hanoi. Most of these houses are located far from city centre and have incomplete infrastructure such as Nam An Khanh or Gamuda. Many urban projects including Lideco, Van Phu and An Hung are also suffering with thousands of homes being abandoned for a long time.

Despite the harsh situation, investors still show optimism and hope that transactions will increase along with economic recovery.

RoK, Vietnam join hands to combat trade fraud

The Market Surveillance Agency under the Ministry of Industry and Trade and the Intellectual Property Office of the Republic of Korea (KIPO) on April 8 inked a memorandum of understanding (MoU) on cooperation in intellectual property observation.

The deal will also allow the two sides to share experience in preventing and combating trade fraud and fake commodities.

According to the Ministry of Industry and Trade, counterfeit goods remain a serious problem in Vietnam as well as many countries in the world, causing billions of dollars in losses to the economies.

In 2013, the total value of smuggled commodities seized by authorities in Vietnam exceeded VND1 trillion (US$47.4 million).

Statistics from the Market Surveillance Agency showed that imitated RoK products are predominantly cosmetics, food and garments.

In the RoK, the KIPO established special judicial forces in September 2010 to combat fake commodities, conducting criminal proceedings against more than 900 smugglers.

The MoU is expected to help Vietnam build a healthy and equal business environment, moving in a positive direction for partnership between enterprises of both sides.

Vinafruit sets sights on US$1.2bln export target

Fruit and vegetable export earnings grew by 32.2% to US$215 million during the first quarter of the year and are expected to hit a record high of US$1.2 billion this year, according to the Vietnam Fruit and Vegetables Association (Vinafruit).

Vinafruit says key exported products in the reviewed period included dragon fruit, bananas, mangos, longans, litchi, star apples, rambutan and grapefruit.

The majority of fruit and vegetable exporters are optimistic that 2014 will be an economically thriving year as the backlog of orders from traditional markets, such as Russia, Japan, Ukraine and Belarus have increased dramatically.

The top five importers of Vietnamese fruit and vegetables are China, Japan, the US, Thailand and Malaysia. China is the largest consumer, accounting for nearly 35% of the total value.

Last year, China purchased US$302 million worth of Vietnamese fruit and vegetables, an annual increase of 38.77%, and market analysts forecast this growing trend will continue in 2014.

In an unexpected turn of events, dragon fruit exports rose significantly in markets throughout the world in 2013, a trend that is predicted to carry over for 2014.

Vietnam exported 1,300 tonnes of dragon fruit to the US, more than 1,000 tonnes to Japan, and 300 tonnes to the Republic of Korea.

Since late March, exports of dragon fruit have also been picking up steam in the New Zealand, the RoK, and Taiwan markets.

In another unanticipated market shift, China, Singapore, and the RoK have suddenly increased imports of Vietnamese bananas. Currently, China is poised to purchase around 20-30 tonnes of bananas, and Japan needs between 15-20 tonnes per day.

Though prices of bananas traded at farms have doubled, the products are in short supply.

Le Si Cong, Director of Laba Da Lat Company that grows the Laba banana variety,, says his company has failed to meet Japan’s market demand for 10-20 tonnes a day since late 2013.

Besides Japan, the UK, Russia and Ukraine have also expressed a keen interest in Laba bananas.

The country currently produces roughly 1.4 million tonnes of bananas per annum and its cultivation area representing approximately 19% of the total acreage devoted to fruit farming, making bananas one of the key promising export products.

However, banana farming is spontaneous, and the marketplace is hindered by a lack of coordination in the supply chain and consistency in business transactions with a large number of small growers spreading out over a wide area, pushing purchasing and transport costs up.

Average fruit and vegetable export earnings have grown more than 30% annually over the past four years from US$460 million in 2010 to US$623 million in 2011, US$829 million in 2012, and US$1.04 billion in 2013.

However, competition remains weak and many fruits and specialty exports suffer from quality defects and are returned back due to bacterial infections and other contamination.

For instance, Japan is a strict market. When they detect any insects in a batch of fruit or vegetable exports from Vietnam, all fresh and frozen fruit and vegetables are banned from entering the market.

Vietnam’s preservation technology has yet to meet international requirements, and only a relatively few Vietnamese products have been licensed to penetrate the Japanese market.

This situation is manageable and could be rectified by Vietnam paying more and proper attention to investment in scientific technology in processing and post-harvest preservation.

Furthermore, fruit and vegetable exports are overly dependent on the Chinese market which often sees wide fluctuations, creating a great deal of uncertainty and instability in the market.

To sharpen the competitive edge of Vietnamese products, clean production methods, such as VietGAP and GlobalGAP need to be applied universally in the market place by stakeholders in the industry, along with increased coordination of exporting activities.

Nguyen Van Do, Director of Vietnam Academy of Agriculture Sciences (VAAS), says Vietnam has great potential for fruit and vegetable exports as its export volume makes up only 10% of total production volume and accounts for only 0.1% of total global trade.

Vietnamese food promoted at Asian largest fair

Nearly 30 Vietnamese businesses are participating in the largest international food tradeshow in Asia –Food & Hotel Asia (FHA)–ongoing in Singapore from April 8-11.

The event offers an opportunity for businesses to promote their products, seek business partners and learn more about different types of goods and trademarks in the world marketplace

Vu Thi Tuyet Huong who is in charge of export activities of Vietnam Food Industries Joint Stock Company (VIFON) said that the company exports instant noodles, noodle soup, and porridge to over 50 nations in the world.

The company participates in events like these to further expand export markets, she said.

VIFON aims to sell their products in 60 nations in the coming time and wants to locate a distributor in Singapore and a partner in Thailand and Myanmar during the event.

HCM City-based Vien Hong Company, which is taking part in the event for the first time, also wants to seek partners in Singapore and other nations in South East Asia.

Vien Hong Company General Director Ming-Te Huang, said that each year, the firm exports snack food in various types worth US$2 million to many nations and territories such as the Republic of Korea (RoK), Malaysia, Taiwan, Hong Kong and Macau.

Many joint venture companies in Vietnam such as Topcake, Intermix and Showa Sangyo and Itochu also attending the event in the hopes of finding international partners and expanding exports to the global marketplace.

Vietnam’s economy in Q1: A tale of two demands, says ANZ

Vietnam’s GDP growth in the first quarter of 2014 highlights the need to balance the domestic-led and export-driven component of the economy, according to a recent report released by the Australia-New Zealand Banking Group (ANZ).

ANZ’s latest report showed that external driven demand remains the driving force of economic growth. Strong foreign direct investment (FDI) will likely fuel manufacturing exports as Vietnam moves up the value chain in the production of high-tech semiconductors and steers away from an over reliance on garment exports.

On the other hand, easing inflation points to the slow improvement in weak domestic demand. The central bank decided to further ease monetary conditions by cutting its policy refinancing rate 50bps to 6.50% in mid-March, thus making a limited effect on the already tepid credit growth. Banks’ high NPL ratios are weighing on risk appetite, leading to tight credit supply.

ANZ forecast Vietnam’s GDP growth at 5.6% and 5.8% in 2014 and 2015 respectively on the back of slow but stable improvements. “We see downward risks to our 2014 inflation forecasts of 7.0-7.5% if the planned government projects fail to prop up domestic demand in the second half of the year,” the report said.

Vietnam’s Q1 GDP growth maintained its steady but slow path of recovery. Economic growth at 4.96% year on year came in below market expectations, despite posting a two-year high for Q1 growth, noted ANZ’s report.

The strong external sector is picking up the slack from the tepid domestic demand and strengthening the current account. Foreign direct investments continue to be the pillar of support propping up industrial production and external trade, it concluded.

Binh Phuoc boosts trade ties with Cambodian locality

The southern province of Binh Phuoc and Cambodia’s province of Kampong Cham on April 8 jointly opened a border crossing to facilitate two-way trade and their socio-economic development and ensure security and defence in the two localities.

The crossing, located in the area between Loc Tan commune, Loc Ninh district, and Cambodian province’s Tuan Lung commune, Mi Mot district, aims to further enhance mutual solidarity and understanding towards the comprehensive cooperation and development between the two countries and the two provinces in particular.

Chairman of Binh Phuoc People’s Committee Nguyen Van Tram asked the two sides to send staff to check and control trading activities through the border crossing as well as create favourable conditions for their businesses and organisations to boost import-export activities.

He added that priority is given to accelerating the operations of quarantine stations in accordance with agreements signed by the two Governments, raising the effectiveness of bilateral cooperation, ensuring security along border areas, and boosting the prevention of smuggling, illegal immigration, and drug-related crimes.-

Vietnam to become jeans production hub

Spain’s Jeanologia and its Vietnamese partner Phong Phu International Joint Stock Company have an ambitious plan to transform Vietnam into a global market leader in the production of high-quality environmentally friendly jeans, radio The Voice of Vietnam (VOV) reported.

Enrique Silla, President of Jeanologia- a Spain jean producer has said that Vietnamese products, especially jeans and knitted items, are finding their niche in the global marketplace and are emerging as a strong competitive rival in terms of price and quality.

Silla said that recent policy changes in China – currently the world’s largest jeans producer – have lessened the attractiveness of the Chinese market to the favour of investment in the Vietnamese garment and textile industry.

He emphasised that the time is ripe for garment producers in the Vietnam to seize the opportunity to ascend to a position of global leadership in the production of high-quality jeans.

To achieve the goal, he suggested that in addition to capitalising on factors such as of its young talented labour force, Vietnam should focus on modernising its production technologies to improve product quality and most importantly increase added value of production.

“World famous jeans producers such as Levis Strauss or retailers UNIQLO, Zara, H & M, G STAR, A & F, Polo Jeans or CK have taken notice of Vietnam’s emergence in the industry and are keeping tabs on the development,” he concluded.

In 2013, Vietnam's textile and garment industry gained 20 billion USD in export value. That represents a year-on-year increase of 18.6 percent to reach 17.9 billion USD for textile and garment exports and a 15.7 percent surge to reach 2.1 billion USD for fibre products. The industry boasted a trade surplus of 5.12 billion USD last year, with imports of raw materials estimated at 14.88 billion USD.

This year, the textile and garment industry firms have started large projects to expand their production and earn new business opportunities.-

Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR

FDI, VCCI, Nghi Son EZ, industrial zones, e-commerce market, power
 
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