Last update 5/25/2011 9:00:00 AM (GMT+7)
  

BUSINESS IN BRIEF 25/5

HCMC enterprises overcome economic problems

Enterprises in Ho Chi Minh City have proved that by all-out efforts they can overcome their financial problems in the present context of the difficult economic situation in the country.

Le Hoang Quan, vice chairman of the HCMC People’s Committee, stated this on May 17 at a meeting to review the city’s implementation of the Government’s Resolution 11 to curb inflation and stabilize the macro-economy.

Huynh Van Minh, chairman of the HCMC Enterprise Association, said when lending interest rates of banks soared to 24-26 percent, many enterprises were worried that they wouldn’t be able to earn enough profit to pay interest.

Some said if they had money, they would deposit it into the bank with a savings interest rate of 18-20 percent per year, rather than invest the money into production and businesses, he added.

However, he said, enterprises didn’t give up their businesses, so they have sought ways to overcome difficulties to maintain their operations.

Mr. Minh said many enterprises have switched to mobilizing funds from their staff, instead of borrowing from banks.

Saigon Transportation Mechanical Corporation (Samco) has issued debentures to their staff and mobilized nearly VND20billion (US$952,400).

Ben Thanh General Corp. has borrowed from their staff at an interest rate of 16 percent per year. This rate is higher than savings interest rates offered by banks but lower than lending interest rates offered to enterprises.

Enterprises have had to restructure their investment projects in a reasonable and effective manner to have funds to maintain production and businesses.

A representative of Saigon Industry Corp. said the company has concentrated its funds on manufacturing key products and buying state-of-the-art machinery to make competitive products.

Cho Lon Import-Export and Investment Company (Cholimex) has rescheduled implementation of some projects worth VND500billion (US$23.8 million) to move capital to finish key projects.

Meanwhile, Samco has rescheduled some projects worth about VND300billion (US$14.29 million) to focus on investments for implementing major projects.

Enterprises expressed their optimism, saying that their businesses have been doing well and generating profits.

Addressing the meeting, chairman Quan praised enterprises for finding solutions, saying that these solutions have helped to ensure the lives of the laborers and avoid their dismissal.

He said mobilizing funds from staff has also helped to encourage them to strive with their employers to overcome the present difficult time.

Until the end of April, 61,253 property owners renting to students and workers have not increased their monthly rents. Enterprises employing over 50 workers also raised salaries for their workers by VND100, 000-250,000 per month; and subsidized escalation of prices with VND100, 000-500,000 per month and housing costs with VND100, 000-300,000 per month.

Dirt cheap prices cause loss to vegetable growers

Since March, vegetable farmers in the Central Highlands province of Lam Dong have been suffering great losses as vegetable prices have gone down by as much as 70 percent.

Tomatoes are now being sold to traders at VND1,000/kg, down by 50 percent compared to March. The same is true for green beans and chayote.

Le Thanh Toan, a farmer in Quang Lap Commune, said he had invested VND60 million (US$3,000) in his 0.7-ha tomato crop but had only managed to get VND2 million ($100) back.

Le Thi Xuan in Ka Do Commune said she had suffered from a VND7 million ($350) loss as cabbages’ price had fallen to only VND1,000/kg.

Traders said prices have been plunging as Ho Chi Minh City, the main consumer of Lam Dong vegetables, has found alternative suppliers who can provide vegetables at cheaper prices thanks to their closer distance to HCMC and thus lower transportation costs.

HCMC to offer more river tours

Ho Chi Minh City would develop more river tours revolving around popular Can Gio District this year, said the city’s Department of Culture, Sport and Tourism.

The new tours will all depart from Bach Dang Port then follow two different routes: Can Thanh Town – Sac Forest Base – Dan Xay Bridge; and Tam Thon Hiep – Dam Sen Park – Vam Sat Tourist Site.

These tours will include community activities such as planting trees, feeding fish, catching shrimps and exploiting sand with local residents.

Markets dying as customers move to streets

Markets throughout Ho Chi Minh City have been seeing an increased number of customers choose street vendors and supermarkets over traditional markets, causing many market vendors to move to the streets to sell.

Nguyen Xuan Trang, head of the management board of Pham Van Hai Market in Tan Binh District, said only 20 out of the 200 registered stalls in his market are still in operation.

Management at Ba Chieu Market in Binh Thanh District said 70 percent of its stalls are left empty and most of its vendors have moved to the streets to sell.

Some vendors said the reason for the decrease in market customers is that street vendors sell their products in the areas around the markets, blocking customers’ paths to the markets.

The street vendors are as crowded as the vendors in the market, and they sell the same products as well.

Nguyet, a fish vendor in Tan Binh District’s Pham Van Hai Market, said most market goers nowadays prefer to stop on the streets to buy things, rather than park their motorbikes to go into the market.

Phu, one former market-goer at Phu Nhuan Market, said she has stopped entering the market since the parking fee went up to VND4,000 per motorbike.

Another reason customers are shying away from markets is the old degrading buildings that house many of them.

Most of the markets have very poor environmental and hygiene conditions, while supermarkets are clean and comfortable for customers.

Unstable prices in the markets are also driving customers off. Many complain that prices usually go up unreasonably during holidays, reducing the markets’ reputation.

But it’s not easy to sweep away the street vendors. The management boards of the markets have asked local authorities to stop them, but nothing has been done yet.

City policies drive inflation down

Stable prices and reduced hoarding of several essential commodities are among initial results gained by HCM City after three months of implementing the Government's Resolution 11, a review meeting heard Tuesday.

Resolution 11 was issued to curb inflation, stabilise the macro-economy and ensure social security.

The municipal administration reported at the meeting that strict controls had been maintained in price management, helping stabilise prices and reduce speculative hoarding of commodities.

The city had added medicines, powdered milk and education supplies to its list of goods covered by its price stabilisation programme, the meeting was told.

The programme had also expanded its distribution network to traditional markets, residential areas, industrial parks and export processing zones, officials said at the meeting.

Furthermore, district administrations were able to obtain commitments from 60,000 landlords that they would not increase rents on 400,000 rooms until the end of this year, benefiting more than a million low-income workers and students.

The city has cut public spending and investments, saving more than 10 per cent in regular public expenditure.

Implementing Resolution 11 had helped reduce the gap between the official and black market foreign exchange rates, the meeting heard.

Nguyen Van Dung, deputy director of the State Bank of Viet Nam's HCM City Branch, said commercial banks had never been able to buy a large amount of US <$> as at present.

Since the official and black market exchange rates were nearly on par with each other, more people were selling their foreign currencies to commercial banks, he said.

Representatives of many companies reported at the meeting that they had taken several measures to mobilise capital, restructure production, and invest in advanced equipment and technologies to increase product competitiveness.

They had also taken steps to provide better working conditions for their employees, the company reps said.

Companies that have more than 50 workers on their payroll have increased salaries by VND100,000-250,000 a month and provided additional monthly allowances to subsidise rising food and house rentals.

Huynh Van Minh, chairman of the HCM City Enterprises Association, said that several enterprises had responded to higher interest rates by mobilising capital from their employees.

The Sai Gon Transportation Mechanical Corporation (Samco), for instance, had mobilised nearly VND20 billion by issuing bonds to its employees, he said.

The Ben Thanh Corporation has borrowed loans directly from its employees with an interest rate of 16 per cent a year, higher than bank depositing rates but lower than bank lending rates.

Le Hoang Quan, chairman of the city People's Committee, said these measures by enterprises had provided livelihood security for employees and create strong employer-employee connections to help overcome difficult times.

He asked departments and agencies at all levels to continue strengthening their market management and price stabilisation functions and keep a close watch on trading in foreign currencies.

Departments and agencies had to monitor enterprises'production activities closely to provide prompt assistance when they faced difficulties, he said. Quan also asked agencies to strengthen efforts to ensure sufficient power supply for all sectors.

Exporters urged to insure

Trade credit insurance is becoming increasingly important with many Vietnamese exporters having suffered payment defaults, a seminar heard in HCM City yesterday.

Christopher Shortell, vice president of Chartis Asia Pacific's Trade Credit, Surety and Political Risks, said the insurance protects a policyholder against non-payment by a customer due to financial or political events.

For industries like paper, chemicals, pharmaceuticals, food, services, apparel, textile, metals, and electronics, it was especially important, he said.

It would also help reduce bad debts and help Vietnamese exporters significantly improve their competitiveness, he added.

Le Thi Ngoc Huong, operations director of AON Viet Nam Co, which provides risk management services, insurance, and human resource consulting services, said, many exporters just think about marine cargo insurance against damage to export products during transit.

Together with marine cargo and product liability insurance, trade credit insurance is a complete solution for managing risks pertaining to exports, she added.

Risk management for exporters is a major concern in a rapidly growing economy like Viet Nam.

Vo Tan Thanh, director of the HCM City chapter of the Viet Nam Chamber of Commerce and Industry, said, Vietnamese exporters face myriad difficulties like inflation, high interest rates and input costs, and foreign exchange volatility.

In this scenario, they should manage export risks well to ease their burden, he said.

Viet Nam's exports are growing at an annual rate of 20-25 per cent.

The seminar was organised by Chartis Viet Nam in collaboration with HCM City branch's VCCI and AON Viet Nam.

Seafood exporter aims at Europe

Viet Nam plans to boost its seafood exports to Europe – a promising market with a huge demand for tra fish (Pangasius), according to an industry insider.

Vice President of the Viet Nam Association of Seafood Exporters and Producers (VASEP) Nguyen Huu Dung, confirmed Viet Nam's export intentions while receiving European Parliament Member Struan Stevenson, who highlighted the achievements of Viet Nam's tra fish industry during the past decade, in Ha Noi on Monday.

Viet Nam has focused on improving the quality of its seafood products while prioritising the sustainable development of the tra fish sector, Dung said. Tra fish processors have adopted international hygienic safety and environmentally friendly standards in order to receive Global Good Agricultural Practice (GAP), Best Aquaculture Practice (BAP) and the Aquaculture Stewardship Council (ASC) certification.

Dung added that the fisheries sector had achieved remarkable achievements in tra fish aquaculture and exports. Tra fish ranked second amongst Viet Nam's seafood products in terms of export volume. The country's present tra fish farming areas had quintupled to 6,000ha since 2001.

Tra fish output had risen from 37,500 tonnes in 2001 to 1.35 million tonnes in 2010, its export value increasing from US$40 million to almost $1.43 billion. Amongst Viet Nam's 136 tra fish importers, Europe is the largest, adding 35.8 per cent to the country's total export revenue, he said Over 49 tra fish processors (45 per cent of Viet Nam's fish processors) have started applying GlobalGAP standards while five tra fish farms have adopted the Pangasius Aquaculture Dialogues (PAD) and ASC standards.

Viet Nam has signed a co-operation agreement with the World Wide Fund for Nature (WWF) based on the sustainable development of the tra fish sector in order to meet ASC standards through the Aquaculture Improvement Project (AIP) for tra fish to be run during the 2011-15 period.

Power plants struggle with increasing costs and low revenues

The more they produce, the greater their loss. This is the paradox experienced by companies that have invested in small and medium hydropower plants in the Central Highlands province of Dak Lak.

A Tin tuc (The News) bulletin report said the current distribution system based on State subsidy mechanisms have actually pushed most of these companies to the edge of bankruptcy.

Dak Lak is a province that has many hydropower plants but only one buyer – Electricity of Viet Nam (EVN), which sets purchase prices at very low levels while the plants have to pay high interest rates on bank loans.

For instance, the Hoa Long Joint Stock Company borrowed VND21 billion (US$1.03 million) to invest in the Ea M'Doal 3 Electric Plant with a designed capacity of 1.8 MW.

The plant was put into operation in 2008 and fetched an annual turnover of VND3 billion – VND4 billion.

Company chairman Phan Muu Binh said interest on the bank loan has since jumped from 11.75 per cent per year to 20 per cent.

Meanwhile, EVN had set its long-term purchase price (20-29 years) at VND400 – VND607 per kWh before 2008.

Since 2008, the cost of generating electricity has increased considerably, including the interest rates on loans, but the national power utility has kept the purchase price unchanged, Binh said.

The plant's annual revenues were not enough to pay interest, water resource tax and wages for employees, he added.

In the dry season, the plant operates for just 10 hours a day with output at 20-30 per cent of the rainy season.

"We invest in the power plant under the market mechanism, but sell electricity to EVN under the State subsidy mechanism," Binh complained.

The Hoang Nguyen Joint Stock Company has invested VND500 billion (US$23.8 million) in three hydropower plants: Quang Tien, Dak Ru, and Ea Kar with a total capacity of 15 MW, the report said.

VND350 billion ($16.6 million) of the investment was sourced from a loan with an annual interest rate of 10 per cent.

The company expected to take back its investment in 10 years.

With soaring bank interest rates and EVN's price freeze, annual revenues of VND45 billion have not been enough to pay even the interest on loans that has gone up to VND70 billion.

In July 2008, the Ministry of Industry and Trade issued Decision No 18 to adjust electricity purchase contracts between small and medium hydropower plants and EVN. The decision increased the average electricity price to VND650 – VND700 per kWh.

The decision also said that during the four months of the rain season, hydropower plants that have been put into operation after 2008 could sell 85 per cent of their capacity at VND460 per kWh, and the remaining 15 per cent could be sold at VND230 per kWh.

However, the companies have complained that revenues earned during the rainy season are not high enough to offset losses incurred during the remaining eight months of the dry season.

Recently, the Dak Lak People's Committee proposed to the Government and the Ministry of Industry and Trade that small and medium hydropower plants in the province are allowed to renew their contracts with EVN.

It said the plants should be able to sell power at 80 per cent of average price under Decision No 18 during rainy and dry seasons.

Water resources tax could be 2 per cent of the electricity price and banks should offer preferential interest rates to companies so that they can break even.

Dak lak has nine small hydropower plants with a total capacity of 58 MW that are operational. The plants, built at a cost of VND1.160 trillion ($55.2 million), generate more than 290 million kWh each year.

Japanese firm to build local auto parts factory

Japan's Tokai Kogyo Group plans to build an automobile spare parts factory in the central city of Da Nang.

The site will occupy an area of up to 5ha. The project has a total capital investment of about US$20 million.

The plant will supply parts to leading car makers such as Honda, Toyota, Nissan and General Motors.

"Tokai Kogyo Group chose Da Nang after three careful studies," Doan Phuoc Thanh, from the city's Foreign Affairs Department, said.

The city's excellent infrastructure and attractive environment influenced the company's decision, he added.

"Moreover, the cost of human resources in Da Nang is cheaper than in the South and the North," he said, adding that the fact Da Nang was on the East-West Economic Corridor and had good road and sea links was also of prime importance – particularly as the company has a plant in Thailand.

The Tokai Kogyo Group also has spare parts plants in the US, China, Indonesia and India.

The Tokai Kogyo project is in keeping with the city's plans to develop support industries, said Phung Tan Viet, deputy chairman of the municipal People's Committee.

There are currently 60 Japanese investment projects in the city – accounting for 20 per cent of the city's total foreign direct investment.

French appliance firm takes over local fan manufacturer

French household appliances Groupe SEB has bought a 51 per cent stake in Viet Nam Fan Joint Stock Co, allowing the French firm to take control of the Vietnamese ventilator maker, confirmed Tran Thach Quang, Viet Nam Fan Co's marketing director.

Quang declined to disclose the value of the deal but said the outstanding shares were still in the hands of the founding family and employees.

An agreement formalising the purchase will be signed today in HCM City.

Quang said besides this capital contribution, SEB agreed to invest in human resources in business management, marketing and manufacturing of key products.

"In every section, Viet Nam Fan's employees will work with SEB's experienced professionals with the common goal of developing our brand-name with fans as our major product," Quang said.

He said both parties also agreed SEB would not sell their fans at Viet Nam Fan retail stores but focus on building Viet Nam Fan branded products, boosting their market shares on the back of a more intense competitive market.

Viet Nam Fan Co, established in 1990, specialises in manufacturing and marketing fans, mainly with the ASIAvina brand. It currently holds 25 per cent of the domestic market, and owns 40 proprietary stores and two industrial sites. Last year, the company's revenue reached US$15.67 million.

This majority stake in the local company would allow the French group to strengthen its foothold in a market of nearly 90 million consumers where sales of small domestic appliances were increasing due to rising incomes and economic growth, the group said in a press release.

"The take-over of Viet Nam Fan is perfectly in line with our strategy of development in emerging countries," said Thierry de La Tour d'Artaise, chairman and CEO of Groupe SEB. "Beyond our presence in Viet Nam, it will also open doors to other markets in South-East Asia".

US website: Vietnam has great potential for long-term development

The New York based Seeking Alpha website on May 18 posted an article saying that there are many opportunities to invest in Vietnam.

The website noted that GDP growth has remained relatively robust over the years. The 2008 commodity bull market spurred a similar course of events, but even with the global recession, annual GDP growth didn't take too much of a hit. Vietnam’s GDP growth is forecast at around 5-7 percent.

It’s good to see a consistent upward parabolic trend of GDP per capita as higher GDP per capita tends to make the country become a target for global companies. Vietnam can increase its pace of development by bringing in more investment and creating more jobs.

Seeking Alpha also highlighted Vietnam’s strength of cheap labour. It said Vietnam is adding one million workers a year, which is good for cheap labor and a competitive advantage line.

PM approves 10-year tax reform strategy

Prime Minister Nguyen Tan Dung has approved a 10-year tax reform strategy for 2011-20 in order to meet the needs of the market economy while enhancing revenues sources, increasing production capacity, and sharpening the competitiveness of domestic enterprises.

Government Decision No 732/QD-TTg issued on Tuesday stated that the tax reform strategy for the next 10 years would ensure transparency and aim at encouraging exports and investment, especially high-technology investment in remote and rural areas.

The comprehensive strategy encompass reforms to the value-added tax (VAT), personal and corporate income taxes, special consumption taxes, import-export taxes, environmental taxes, and fees and duties on mineral and land use rights and agricultural lands.

Under the plan, tax revenues would be increased by 70 per cent by 2015 and 80 per cent by 2020. By 2015, the State budget would be equal to about 23-24 per cent of gross domestic product (GDP).

By 2015, tax administration would also be modernized to global standards, with simpler administrative procedures that ensure over half of all enterprises use electronic filing.

Bien Hoa pomelo achieves world good practices certification

Bien Hoa pomelo, a speciality of Tan Trieu Pomelo Agriculture and Service Co-operative in Vinh Cuu district, in the south-eastern province of Dong Nai, was awarded Good Agriculture Practice (GAP) certification on Tuesday.

In 2010, the South-eastern Fruit Tree Research Centre transferred pomelo growing technologies under GlobalGap and VietGap models to farmers of the Tan Trieu Pomelo Agriculture and Service Co-operative.

As a result, six farming households won GlobalGap certification and 11 others secured VietGap certification, over an area of 10ha.

"Bien Hoa Pomelo – A speciality of Tan Trieu" was the first fruit brand name of Dong Nai province to be recognised by the National Office of Intellectual Property of Viet Nam, in 2006.

After four years of development, different varieties of Bien Hoa pomelo are being grown on an area of 800ha in eight riverside communes in Dong Nai Province.

Ports to apply e-customs procedures

Seven seaports will experimentally apply electronic customs declarations as of June 9 under a new decision by the Prime Minister.

The ports involved in the pilot project include Hai Phong, Da Nang, Vung Tau, Sai Gon, Hon Gai, Quy Nhon and Nha Trang.

Under Decision No 22/2011/QD-TTG, applicants can complete necessary procedures via the internet within eight hours before the ship arrives or within two hours before it departs from the port.

Paperwork must still be submitted, however, within two hours of ships mooring or leaving the port. Port customs officials will have one hour to respond to the ship's requirements as soon as they receive completed documents.

The head of the Vung Tau Seaport Border Guard Command, Sr Lt Col Nguyen Nhuan Quynh, said his office has implemented electronic procedures since March to save time and facilitate the work of both border officials and customs applicants.

The Vung Tau command is in charge of about 50 international ports in the southern provinces of Ba Ria-Vung Tau, Dong Nai and Binh Duong, with about 30 ships coming and going from the ports everyday.

Now, with e-procedures submitted earlier, the ships are able to go straight to or leave the ports, carrying out their tasks without delay, and the authorities are also able to master more data about the ships coming and going, he added.

UNIDO helps energy productivity projects in Vietnam

The UN Industrial Development Organisation (UNIDO) will help Vietnam optimise energy saving in industry.

A US$6.62 million project financed by the Global Environmental Fund (GEF) will be carried out over three-and-a-half years as from May this year.

The project was designed for industrial enterprises to save energy in their whole production systems and raise their capacity in application of ISO standards for energy management, to integrate energy saving as part of the management process and implement sustainable energy-saving solutions.

According to Deputy Minister of Industry and Trade Hoang Quoc Vuong, Vietnam’s National Target Programme on Energy Saving from 2011-2015 aims to save between 5-8 percent of energy.

At the signing ceremony of the project’s document in Hanoi on May 18, Representative at UNIDO Country Office Vietnam Patrick J. Gilabert said Vietnam is a country with relatively high energy use in comparison with other developing countries, but industrial enterprises have little knowledge of optimising their energy-saving systems.

He expressed his belief that the capacity of energy saving may reach 25 percent depending on each optimised system.

The project will be focused on food processing, garment and textile, rubber, paper and pulp enterprises.

The project will also train Vietnamese experts on energy saving, as well as engineers and managers of factories in utilising energy-saving systems.

Businesses advised to use purchasing management software

Local businesses joining a recent seminar have been advised to apply a purchasing module in their ERP (enterprise resource planning) system to ensure better management and reduce production costs.

Without the software, enterprises usually get into trouble when searching for suppliers, buying orders and products.

As a result, they cannot compare current prices with those in previous years to negotiate with suppliers, said Thai Binh Quy of Viet Nang Co. and Bui Thi Van Ha from Thang Long JOC in a seminar in HCMC on Sunday. The event was organized by Sourcing and Purchasing Club under the Saigon Times Club.

Quy said the software is designed for large enterprises such as Vinamilk, Thien Long office stationery maker and Thien Hoa Electronics and is priced from US$150,000 to US$1 million.

“Purchasing software for small and medium-sized enterprises (SMEs) is rather rare. Only a few software providers design it for SMEs basing it on the scale and scope of business at around US$15,000 each,” Quy added.

Patrick F. McNeal, chairman and general director of Dong Nai Province-based ONP Vietnam Co. Ltd., said the software will help enterprises sharply cut product prices.

Sourcing and Purchasing Club was established in 2008 and tries to improve the professionalism of 200 sourcing and purchasing member companies in the country with seminars, training course and social activities.

Aussie medical univ. seeks partners for services, facilities

The Medical University of Vienna International said on Tuesday it wanted to look for local partners for running a wide range of healthcare services and even to build and operate hospitals in Vietnam.

Christian J. Herald, managing director of Vienna, said the university was looking for partners to provide full consulting packages, management services for hospitals as well as organize training programs to doctors and healthcare staffs in Vietnam and Europe.

The university also has strong interest in projects to build and operate new hospitals as well as projects to upgrade and operate already-established facilities, he told a seminar held in HCMC to introduce the university to local hospitals.

“We have strategic partners and can we can call on them to invest in such projects in Vietnam,” he said at the seminar in the five-star Park Hyatt Hotel in HCMC.

Representatives of some hospitals in the city said they were interested in new hospital management solutions as such methods would help their hospitals improve their services to meet international standards.

Pham Viet Thanh, director of the HCMC Department of Health, said that the city’s healthcare sector has opportunities on offer for services providers in the segment of hospital management skills.

According to him, HCMC now has 66 private and state-owned hospitals, 13 centrally-governed hospitals, 23 district-level clinics and 13,000 grassroots medical clinics. Such facilities provide medical examination and treatment for 31 million outpatients and five million inpatients a year, with around 40% of them coming from provinces across the country.

“We are focusing on improving human resources and management with an aim to develop the healthcare service. We will also build more hospitals in the city’s gateways so we need experiences in the areas for development,” he said.

The Medical University of Vienna International was established in 2005 in partnership with the Medical University of Vienna. The university has implemented hospital projects and scientific collaborations across continents.

The Vienna has strengths in hospital management and planning, hospital operations, and human resources development among others.

Online conference to give Japan market updates

The Ministry of Industry and Trade will hold an online conference with local exporters to give them updates about the Japanese market.

The meeting will be run from 2:00 p.m. to 4:00 p.m. this Friday on the Foreign Market Portal at www.ttnn.com.vn with an aim to help Vietnamese businesses look into the current market conditions in Japan, according to the Multilateral Trade Assistance Project III (EU-Viet Nam MUTRAP III).

The earthquake and tsunami in Japan in March caused massive infrastructure destruction and serious impacts on Japan’s trade and economic development.

The Ministry of Industry and Trade and its relevant departments such as the Asia Pacific Market Department, Export-Import Department, Vietnam Trade Promotion Agency and Vietnam E- commerce and Information Technology Agency will field questions regarding exports to Japan.

This is the second conference in a series of online meetings to be held this year in the framework of the EU-Vietnam MUTRAP III, following the recent online conference on EU market.

In the year to end-April, bilateral trade between Vietnam and Japan expanded over 23% year-on-year to US$5.9 billion, show Vietnam Customs figures. Vietnam’s exports to Japan surged by 26% to US$2.78 billion while its imports edged up 22% to US$3.14 billion.

Customs statistics show a rapid increase in some imports to Japan in the first four months, such as crude oil and garments. Japan’s oil imports from Vietnam soared to US$243 million in the period from US$76.3 million in the same period last year.

According to the Vietnam and Japan Economic Partnership Agreement (VJEPA), which took effect in October 2009, Japan will bring down tariffs to 0% for 94% of Vietnam’s exports to Japan in the next 10 years.

Japan will apply tax exemptions on 86% of farm imports from Vietnam, the highest trade commitment of Japan on agricultural products in comparison with other ASEAN countries that have free trade agreements with Japan.

Meanwhile, Vietnam will also reduce the tariffs to 0% for 87% of Japan’s exports to Vietnam.

Enterprises bemoan high gas prices

Porcelain and glazed tile producers in the country are facing difficulties due to rising gas prices which force them to cut gas use or shift to other kinds of fuel.

Ly Huy Sang, deputy general director of Minh Long 1 Co., said gas price hikes hit the company’s operation and made inroads into revenue of the porcelain ware producer.

“Fuel now accounts for 40% of production cost, not 30% like before,” Sang said.

Besides, some gas companies could not provide standard gas due to high prices, which influenced the quality of porcelain products, Sang added.

Nguyen Van Vu, deputy general director of House of Italian Ceramic Tile Co. Ltd., said many enterprises are losing their competitiveness due to high production costs. They cannot stock gas due to high costs involved in storage devices and the high risk of fire and explosion.

Most enterprises are seeking ways to cut gas use to reduce production costs and product prices. Sang of Minh Long 1 Co. said the company has reduced burning times for some products and put as much as possible in the burning kiln to save fuel.

Meanwhile, some enterprises have shifted to use other fuels. House of Italian Ceramic Tile Co. Ltd. has replaced liquefied petroleum gas with natural gas or coal.

According to some gas companies, they have seen revenue drop by 10% to 20% in recent months.

“Unlike gas used for households, the gas market for industrial production sees tough competition as enterprises buy large volumes. To keep customers, we sometimes have to break even,” said a representative of Petrolimex Saigon Gas Co.

So far, there are no statistics on gas ratio for households and industrial production. Calculation of the ratio is not easy as the products have different mixing methods.

ZTE announned its smart terminal strategy in Vietnam

China’s ZTE Corporation is targeting to enter the world’s manufacturer list at top three for tablet PC, top five for Android smart phones and No.1 for Chinese smart terminals in 2011.

In this regard, Vietnam is considered as a key market to execute the ZTE’s smart terminal development strategy.

“ZTE considers Vietnam as a high potential market while executing the smart terminal development strategy. Previously, through mobile distributors, numerous ZTE’s phone products have appeared in Vietnam and attracted extensive customers’ consideration. From now, we keep directly offering our customers the best products with ZTE brand via Vu Hoang Hai Company, our official distributor, and its extensive and professional distribution network,” said Zhang Bin, terminal director of ZTE Vietnam Office.

As a part of the strategy, ZTE is introducing 10 new smart devices including tablet PC, Android 2.2 smart phones and USB data cards. Of these, Light Tab – the tablet PC run Android Froyo 2.2 is a key product. Light Tab is based on Android OS thus offer the customers thousands of applications that developed by large suppliers through the world to satisfy customer diverse demands.

Priced at VND7.9 million ($381), Light Tab is the first tablet PC in the world which is equipped Dolby Mobile technology – the sound system specifically designed for mobile products which offer customers a wonderful sound experience.

According to the latest Gartner report, global shipment of smart phones will reach 470 million in 2011. ZTE sets a goal to sell 12 million smart phones (including tablet PC) in 2011.

 
*
*
*
  Send