BUSINESS NEWS IN BRIEF 23/1

MoIT celebrates soaring export turnover in 2018

moit celebrates soaring export turnover in 2018

The $245 billion in total export turnover and 29 export categories exceeding the $1 billion threshold are touted as a major success for the Ministry of Industry and Trade (MoIT).    

The rosy export picture was highlighted as one of the achievements of the MoIT in 2018 at the review meeting held on January 17.

Notably, last year, Vietnam’s total export turnover reached $245 billion, up 13.8 per cent on-year and exceeding the target set by the National Assembly and the government. 29 goods categories reached $1 billion in turnover, with five categories hitting $5 billion and five others $10 billion.

Vietnam’s export markets expanded and now Vietnamese goods are present in almost all markets of the world. Numerous goods categories have set a solid foothold in key markets, including Europe, the US, Japan, and Australia. Especially, Vietnam saw an increase in export turnover in markets it signed free trade agreements (FTAs) with, including an increase of 23.2 per cent in South Korea, 13.7 per cent in the ASEAN, and 12.9 per cent in Japan.

In addition, the export turnover of local companies also increased and even exceeded the turnover of foreign-invested companies. Notably, in 2018, local companies exported $69.2 billion, up 15.9 per cent on-year and 12.9 per cent higher than the export turnover of foreign-invested companies.

The export performance played an important role in GDP growth, while simultaneously generating jobs and finding markets for farmers' output. The trade surplus also helped to increase foreign exchange reserves, creating a stable backdrop for the exchange rate and the economy.

“The MoIT expects that in 2019 the export turnover may reach $265 billion, up 8-10 per cent on-year. Meanwhile, the import turnover may be $268 billion, up 11.7 per cent. The trade surplus is estimated at $3 billion,” said Hoang Quoc Vuong, Deputy Minister of Industry and Trade.

Speaking at the meeting, Prime Minister Nguyen Xuan Phuc said that whether Vietnam can become a tiger or a dragon of Asia will depend on the contribution of the industry and trade sectors.

Trade deficit touches US$1 billion mark in early 2019

trade deficit touches us$1 billion mark in early 2019 hinh 0

Vietnam saw an unexpected trade deficit of nearly US$1 billion during the first half of January, as reported by Vietnam Customs.

Increasing imports in the first half of January were attributed to high demand for imported goods on the eve of Tet (Lunar New Year).

According to newly-released statistics by the General Department of Vietnam Customs, the country reaped US$9.2 billion from exports during the first two weeks of January, representing a slight drop of US$71 million on-year.

Imports meanwhile reached nearly US$10.2 billion in value, surging by US$646 million on-year.

Textiles, telephones and their components, computers, electronic items, and components topped the list of exports with each staple reaching over US$1 billion in value.

The trade deficit could primarily be attributed to a sharp drop in the number of telephone exports. The overseas shipments of telephones recorded only US$1.293 billion in the reviewed two weeks, a slide of over US$800 million on-year. In addition, computers, electronic products and components also suffered a slight decrease of nearly US$50 million. 

Many insider experts blamed the increasing imports in the first half of January for high demand for imported goods on the eve of Tet (Lunar New Year).

Last week, the Ministry of Industry and Trade released a target of curbing the country’s trade deficit of US$3 billion during 2019.

The industry and trade sector has this year projected export growth to jump by 8 to 10% to US$265 billion. Imports are expected to total US$268 billion, up by 11.7%, thus leading to a trade deficit of an estimated US$3 billion.

The ministry also planned to further bolster the access that key domestic products could gain to regular and potential export markets. Priority will be given to purchasing machines, equipment, and manufacturing inputs that are not available within the domestic market while the import of luxurious items and those on sale in Vietnam will be kept under close watch. 

Efforts will be maximized to tap into the advantages of valid free trade agreements (FTAs) as well as preparing for the effective implementation of new-generation FTAs.

Vietnam saw a trade surplus of US$2.52 billion in 2016, at the peak level since 2005, while the figure climbed to US$2.67 billion in 2017.

During the first 11 months of 2018, the country gained US$7.4 billion in trade surplus, according to the General Statistics Office of Vietnam.

FastGo launches FastBike Pro in Hanoi

fastgo launches fastbike pro in hanoi hinh 0

Ride-hailing app FastGo begun its FastBike Pro service recently in Hanoi after a period of testing.

As part of the launch, FastGo also introduced a promotional program of VND11,000 ($0.5) for all rides under 6 km from January 11 to 22, in six districts in Hanoi.

FastGo also offers incentives for the first drivers to register, with revenue of VND5 million ($215) per month guaranteed in the first two months and a free uniform.

 To encourage and support drivers, FastGo also offers an additional VND15,000 ($0.6) per ride from midnight to 5am.

 FastGo also provides health insurance packages worth up to VND20 million ($860) and insurance related to theft or new vehicle purchases, of VND20 million ($860), to attract drivers, especially students.

 It has tested FastBike Pro since August, with the difference being a greater focus on professional two-wheeler services, as drivers must undergo a rigorous recruitment process, assessing their ethics and attitudes and ability to ride a high-end motorbike.

 Founded last June, the NextTech Group’s FastGo Vietnam has grown rapidly, staking out presence in seven cities and provinces throughout the country within the first six months of launch, with four-wheel ride-hailing services including FastCar, JustGo, and FastTaxi.
 
 Beyond ride-hailing, it is also an open application for a variety of services, including home delivery, home care, and personal finance. The app is available at the App Store and the Google Store.

 FastGo provides stable incomes to more than 40,000 drivers, high reward points, a Fast Protection insurance policy, and study encouragement programs for their children. In particular, it does not charge a percentage fee on drivers.

 It marked a step towards the international market when launching services in Myanmar on December 28 and it aims to be in the Top 2 in Southeast Asia in the near future.

 FastGo recently won third prize at the Vietnam Talent Awards 2018, organized by the Dan Tri newspaper and the Vietnam Posts and Telecommunications Group (VNPT) since 2005. The award is recognition of the ongoing efforts of FastGo to continue its mission of providing users with a safer and more comfortable technology experience.

Fruit and vegetable exports hit record high of US$3.5 billion

fruit and vegetable exports hit record high of us$3.5 billion hinh 0

Vietnam increased its fruit and vegetable exports by 10.8% on-year, setting a new record in 2018, with the figure once again surpassing the nation’s export turnover of crude oil.

Despite a 10% on-month drop to US$262.3 million in December, fruit and vegetables exports in 2018 still peaked at US$3.52 billion.

Fruit and vegetable exports have become a new driving force for the country’s agricultural sector. In 2016, the exports of fruit and vegetables totaled US$2.4 billion in value, an annual increase of 33.6%. The figure then soared by 42.5% to reach US$3.5 billion in 2017.

Despite a 10% on-month drop to US$262.3 million in December, fruit and vegetables exports in 2018 still peaked at US$3.52 billion, jumping by 10.8% on-year.

As a result, the export value of fruit and vegetables has so far surpassed that of other key farm produce, including tea, pepper, and rice.

China was the largest export market for domestic fruit and vegetables as the trading value reached US$2.78 billion in 2018, an annual increase of 5.03% and equivalent to 73% of the total export turnover of the sector. 

This was followed by the United States, Southeast Asian countries, the EU, the Republic of Korea, and Japan. These importers spent more than US$100 million buying fruit and vegetables from Vietnam.

According to the Vietnam Fruit and Vegetables Association, the local fruit and vegetable production chain has made great progress. There has been an increased focus on technology helping to trace the origin of products on offer in major cities.

This shows the sector’s approach to large-scale and advanced production with a view of ensuring supply for major cities and importers.

The Ministry of Agriculture and Rural Development has reportedly set a target of bringing fruit and vegetables exports to US$10 billion by 2025.

Local firms are being urged to further improve the quality of fruit and vegetables along with their hygiene. Businesses are also being encourage to cut down product costs to gain a competitive edge. 

Meanwhile, investments in processing technologies and facilities are needed to assure a year-round supply of fruit and vegetables as well as seeking higher added value, thus leveraging their entry into new export markets.

BIDV Insurance earns $9m in pre-tax profit

     

In 2019, BIC has targeted total premiums of VND2.2 trillion and consolidated profit before tax of VND223 billion. — Photo vnr500.com.vn


BIDV Insurance Corporation (BIC) has reported profit before tax of nearly VND203 billion (US$8.7 million) in 2018, beating its yearly target by 6.7 per cent. This number is also 8.8 per cent higher than the previous year.

Total premiums the company earned from insurance sales reached more than VND2.1 trillion ($90.3 million), up 16.3 per cent year-on-year and surpassing its goal set for 2018 by 3.2 per cent.

The insurance arm of the Bank for Investment and Development of Viet Nam (BIDV) posted strong growth of 50 per cent in bancassurance sales (selling insurance to bank customers).

In 2019, the company has targeted total premiums of VND2.2 trillion and consolidated profit before tax of VND223 billion.

Its joint venture in Laos – Lao Viet Insurance Co (LVI) - reported premium revenue of $13.3 million, completing 103.6 per cent of its yearly plan. The company’s pre-tax profit was $550,300.

In Cambodia, Cambodia-Vietnam Insurance (CVI) also ranked fourth in terms of market share, up one place compared to the previous year, general director Tran Hoai An said without delivering a specific revenue.

An said this year, the company would continue to focus on developing retail distribution channels, especially through banks, as well as promoting the quality of its corporate governance and risk management.

Service quality would also be enhanced before, during and after sales, through applying advanced technology to better serve clients and expand distribution networks, he said.

Shares in BIC on the Ho Chi Minh Stock Exchange declined 3.8 per cent on Tuesday to around VND25,500 ($1.10). 

VND800m for 30-second TV ad in Viet Nam – Japan Asian Cup 2019’s quarterfinal match

     

Viet Nam’s players celebrate after making it through to the quarter-finals. 


VTV is charging VND800 million (US$34,800) for 30-second ad slots for the Viet Nam-Japan quarter-final match at the Asian Cup 2019.

The national broadcaster has increased the price by VND200 million compared to the Viet Nam-Jordan knock-out match, which matched the same rate the corporation was charging for the World Cup 2018 final between Franch and Croatia and only lower than the record of VND950 million for the AFF Cup 2019 final between Viet Nam and Malaysia in December 2018.

The Viet Nam-Japan match will take place at 8pm (local time) on Thursday at Rashid Al Maktoum, Dubai, where Viet Nam beat Jordan.

VTV is the exclusive owner of the copyright for the Asian Cup 2019 in Viet Nam.

Binh Duong open for investment

Clothes are produced at the Japanese firm Toyotsu Vehitecs Vietnam in Binh Duong province’s My Phuoc 3 Industrial Zone 


To reach the targets for economic growth for the 2016 – 20 period, the southern province of Binh Duong will focus on eight major works this year to encourage new investment.

Provincial authorities will urge site clearance and facilitate construction work to improve the investment climate and help the private sector to develop.

The province will open industrial parks and zones to welcome new investment trends, said Mai Hung Dung, Deputy Chairman of the Binh Duong People’s Committee.  

In addition to efforts to improve the quality of urban management, Binh Duong will conduct research and invest in multi-mode transportation, and move polluting facilities in residential areas to industrial zones and parks.

Dung said the province will also improve the province’s public investment and accelerate construction of major work, and focus on training of human resources for the Industry 4.0 era.

The province has set 12 targets for sustainable economic growth, with major growth focused on the service sector.

It will also continue to invest in infrastructure, with the aim of turning Binh Duong into a first-grade city, thus contributing to efforts to improve the living standards of Binh Duong residents and to build Binh Duong into a smart city.

Binh Duong has targeted a GRDP (Gross Regional Domestic Product) of 8.4 – 8.6 percent this year and per capita income of 140 million VND (more than 6,030 USD).

The province’s socio-economic development attained significant growth last year. The province fulfilled 27 of 29 targets set by the provincial authority for 2018.

The Binh Duong provincial Department of Planning and Investment also reported significant improvement in the investment environment, with total foreign investment (FDI) of more than 1.6 billion USD in the first 10 months of 2018, bringing total FDI registration in the province to 31.75 billion USD. 

European poultry quality campaign in Vietnam reviewed

The European Poultry - the Power of Quality campaign’s performance in Vietnam over the last three year was reviewed at a conference held by the National Poultry Council in Ho Chi Minh City on January 21. 

The campaign, implemented with the support from the EU and Poland’s National Poultry Council – Chamber of Commerce, is an information and promotional programme to promote the advantages, quality and production methods of European poultry that conforms to the QAFP (Quality Assurance for Food Products) system.

It aims to raise public awareness of high-quality poultry, taste value and production standards, and increase exports of European poultry to target markets, including Vietnam.  

The programme also focuses on legal regulations in exporting poultry from EU member nations to Vietnam, and how to increase the demand for high-quality European poultry in the Vietnamese market. 

According to Lukasz Dominiak, General Director of the Poland National Poultry Council – Chamber of Commerce, many activities have been arranged in Vietnam during the campaign, including trade fairs, seminars and exhibitions of food made from European poultry in Hanoi and HCM City. 

The campaign also organised delegations of Vietnamese firms to visit poultry processing firms in the EU and learn about production standards. 

The “European Poultry - the Power of Quality” campaign is directed at the markets of China (with Hong Kong), Vietnam and United Arab Emirates. The main objectives of the initiative are to generate demand for QAFP poultry and build a positive image of QAFP poultry.

QAFP is the system targeting consumers and poultry producers or those who pay attention to production conditions and want to be sure production is compliant with stringent quality standards.

HCMC to auction five land lots in Thu Thiem

An aerial view of the Thu Thiem New Urban Area project under development in HCMC's District 2. The HCMC government will auction five land lots in the project 


HCMC vice chairman Tran Vinh Tuyen has assigned the Department of Finance to coordinate with the Thu Thiem New Urban Area Management Board and other relevant agencies to propose the starting price for five land lots, part of the Thu Thiem New Urban Area project in Binh Khanh Ward in HCMC’s District 2, as the city intends to put them up for auction, according to a report in Nguoi Lao Dong newspaper.

The municipal vice chairman agreed that the starting price would not include value-added tax to ensure the effectiveness of the auction and compliance with the law.

The city government also asked the Department of Finance to consult other relevant departments and agencies and propose rates for 1,080 apartments in the resettlement area of the project in Binh Khanh Ward, which includes a total of 12,500 apartments. The price will not include the costs of infrastructure projects or the loan interest after compensating households affected by the project and handing over land to investors.

VINAPA proposes increasing tra fish output

Tra fish (pangasius) exports to China may see slower growth this year, so local farmers should boost tra fish yields and reduce the selling price of the product to enhance competitiveness, said Vo Hung Dung, vice chairman and general secretary of the Vietnam Pangasius Association (VINAPA).

At a seminar, titled “Product quality - basis for tra fish sustainable development,” held in Can Tho City today, January 18, Dung remarked that the Chinese Government had tightened control over the informal export of tra fish to its market. 

In addition, the northern neighbor has encouraged the farming of tra fish, and it may establish tra fish associations to protect its tra fish farmers and enterprises, thus creating obstacles for Vietnamese tra fish exporters.

Although Vietnam has set up tra fish value chains and domestic farmers and firms are experienced in responding to price fluctuations, it is necessary to increase the tra fish output to reduce the selling prices and improve the competitiveness of local products, Dung noted.

As of December 12 last year, Vietnam had exported US$2.15 billion worth of tra fish, up 26.3% year-on-year. The largest importers of Vietnamese tra fish were the United States, at US$525 million; China, US$505 million; and the European Union, US$231 million.

HCMC aims to attract 8.5 million international tourists

Foreign tourists are seen in downtown HCMC


The HCMC Department of Tourism plans to organize a range of activities to introduce the city’s tourism products and services at the ASEAN Tourism Forum (ATF) and the Travel Exchange (Travex) fair 2019, which are taking place in Quang Ninh Province from January 13 to 19, to fulfill its target of welcoming 8.5 million international tourists this year, Thanh Nien newspaper reported.

In addition to the target for international visitors, up 14% against last year, the city tourism sector is set to draw 32.7 million local travelers to the city in 2019, up 13% against 2018, according to Nguyen Thi Anh Hoa, deputy director of the HCMC Department of Tourism. The city also aims for VND150 trillion in tourism revenue, a 14.5% rise against last year.

In participating in ATF 2019 and Travex 2019, the city is striving to create a reputation as a gateway to the region and a tourist destination, showing the convergence of a wealth of Vietnamese cultural characteristics.

Further, HCMC introduced its program titled, “Program Stimulates Tourism 2019,” featuring eight new tours, to firms at both events to attract more travelers.

The events gave the city’s tourism sector a chance to learn about the experience hosting an international fair, helping the city achieve its aim to boost tourism promotion activities in 2019.

Huynh Van Son, a tourism expert, suggested that the city better develop tourism attractions and products, mainly those highlighting the national and cultural characteristics of the outlying districts of Can Gio and Cu Chi. Taking the Cu Chi Tunnels as an example, Son pointed out that the tourist site has been attracting large numbers of visitors for a long time.

An interesting tourist site built and developed in the city will contribute to lengthening international tourists’ stay, Son said.

Some experts also noted that as HCMC is a modern industrial and financial hub and is poised to become the financial center of the region, its tourism sector should be developed in collaboration with the development of the trade and service sector to appeal to more visitors.

To establish a system of attractive and characteristic tourism products successfully, the leader of the municipal Department of Tourism said, the department would continue to trial six tour programs proposed for the 2018-2020 period and enhance sports- and agriculture-based tourism products to serve travelers.

In related news, the 22nd Meeting of ASEAN Tourism Ministers opened in the northern province of Quang Ninh on January 17 within the framework of the ASEAN Tourism Forum 2019.

Speaking at the event, Minister of Culture, Sports and Tourism Nguyen Ngoc Thien asked ASEAN national tourism organizations to foster cooperation in all aspects to improve service quality and facilitate tourists’ travel.

Mitsubishi Triton 2019 makes its debut in Vietnam

A model poses for a photo with Mitsubishi Triton 2019 pickup trucks at the launch ceremony held in HCMC 


Mitsubishi Motors Vietnam launched its pickup model, the Mitsubishi Triton 2019, on January 18, starting at a price of VND730.5 million.

Triton 2019 is the latest version of the automaker’s pickup truck model, which comes with the new six-speed automatic transmission, instead of the previous five-gear model.

Mitsubishi Triton 2019 is equipped with a turbo oil engine (4N15) MIVEC 2.4L to offer a maximum power of 179 HP and a maximum torque of 430Nm. The Triton 2019 comes in two versions namely 4x2 AT MIVEC and 4x4 AT MIVEC at prices of VND730.5 million and VND818.5 million, respectively. Triton 2019 pickup trucks are available in six colors, including black, white, silver, brown, orange and grey.

In 2018, Mitsubishi sold over 2,000 Triton vehicles, becoming the third most popular model in the pickup segment of the Vietnamese market’s auto sales. The Japanese automaker expects to sell 3,000 units this year.

HDBank reports outstanding performance

Customers make transacttions at an office of HDBank - PHOTO: HDBANK


HCMC Development Joint Stock Commercial Bank (HDBank) has announced its 2018 business results in a report, boasting a pre-tax profit reaching over VND4 trillion (US$172.4 million) last year, the highest-ever. The figure surged 65.7% year-on-year.

The bank obtained a net profit of VND438 billion from services, double the figure last year. Meanwhile, the net earnings from foreign exchange activities posted a two-fold increase over the previous year, hitting VND298 billion.

Its return on equity and return on assets were 20.27% and 1.58% respectively. Further, its bad debt ratio stood at 0.97%, the lowest in the local banking system.

As of the end of last month, the bank’s assets totaled VND216.1 trillion, up 14.1% versus 2017.

HDBank has mobilized nearly VND191.6 trillion and raised its equity by 14% to VND16.8 trillion, making it ready to apply Basel Capital Accord II (Basel II) standards as soon as it receives the State Bank of Vietnam's approval.

Last year, the bank opened an additional 45 branches and transaction offices, taking the total to 285 nationwide. Additionally, HD SAISON Finance, a joint venture between HDBank and Japan’s finance corporation Credit Saison, served nearly seven million customers at more than 13,800 offices, including over 2,300 offices opened in 2018.

Moreover, the bank’s HDB stock was listed as one of 20 stocks with the biggest capitalization on the Hochiminh Stock Exchange. The bank was also awarded the second-class Labor Medal on the occasion of its 28th anniversary.

HDBank was one of 37 enterprises in HCMC contributing the most to the city’s budget. Last year alone, it won multiple awards, including the “Best Companies to Work for in Asia” award of HR Asia, the “Retail Banking Award” by the Vietnam Banks Association and the International Data Group, and the “Cash Management in Asia Pacific” award by Euromoney.

Besides business activities, HDBank has attached much importance to community programs. The bank presented 1,000 scholarships to students and thousands of health insurance cards to near-poor people.

This year, HDBank expected to increase its asset value to some VND328.6 trillion, mobilize more than VND303 trillion and generate some VND5.1 trillion in pre-tax profit.

SSI announces excellent 2018 results

     

SSI Securities Incorporation achieves all its targets last year despite the volatility in the securities market. — Photo Courtesy of SSI


SSI Securities Incorporation reported strong growth last year despite the volatility in the securities market, with pre-tax profits going up by 36 per cent to nearly VND1.74 trillion (US$74.8 million) and revenues by 37.2 per cent to VND4.06 trillion ($175.04 million).

The VN-Index reached a new high of 1,211 points on April 10 before falling back sharply and ending the year at 892.54 points, a 9.32 per cent fall for the year.

But SSI achieved all its targets and retained its leading brokerage position on both the HCM City and Ha Noi stock exchanges with a market share of 18.7 per cent and 11.89 per cent.

Its revenues from securities services surged 42 per cent to VND1.89 trillion.

The company saw over 20 per cent growth in the number of customers to more than 151,300 individual accounts and over 1,900 institutional accounts.

Its financial business services division and treasury achieved revenues of VND755.6 billion, a year-on-year increase of 57 per cent.

By the end of last year, the company had assets of VND23.4 trillion, up 29 per cent from a year ago.

It won a clutch of awards last year, including Best Securities House in Viet Nam from Asiamoney magazine and Best Corporate and Institutional Adviser – Domestic, Best Brokerage and Best IPO from Asian financial magazine the Asset.

GreedFeed aims for safe pork

     

Representatives of the Ministry of Agriculture and Rural Development’s Department of Animal Health, Binh Thuan Province and GreenFeed sign a co-operation agreement to build a safe pork production chain in HCM City on Saturday. — Photo greedfeed.com.vn


The GreenFeed Viet Nam Corporation will help the southern province of Binh Thuan build a chain of safe pork production facilities from now until 2022.

Under the co-operation agreement signed by representatives of the Ministry of Agriculture and Rural Development’s Department of Animal Health, Binh Thuan Province and GreenFeed in HCM City on Saturday, the chain will be built following standards of the World Organisation for Animal Health (OIE), as being free of diseases such as foot-and-mouth disease, pig cholera and blue ear, ensuring sustainable livestock development, improving product value, providing safe products for domestic consumption and meeting international requirements to export pork.

Do Cao Bang, General Director of GreenFeed Corporation, said the parties were building a database to implement their goals. The chain was expected to start in June this year.

“The company has conducted a review and assessment of the conditions of animal feed factories, pig breeding facilities in Binh Thuan Province and organised training courses for officials and employees working directly in these farms,” said Bang.

GreenFeed has completed qualified slaughter and pork processing facilities according to HACCP, GlobalGAP and ISO 22000 certifications in accordance with OIE regulations. It has also proactively sought consumption markets for pork. It is expected that GreenFeed will associate pork production with pig breeding cooperatives of Binh Thuan province on an area of ​​140 ha, providing 10,000 sows and 30,000 pigs per year to the market.

In the short term, GreenFeed’s main export product is chilled and frozen meat, which is expected to be exported to markets such as China, Hong Kong, Singapore and Japan. 

Binh Duong open for investment

     

Clothes are produced at the Japanese firm Toyotsu Vehitecs Viet Nam in Binh Duong Province’s My Phuoc 3 Industrial Zone. Total registered value of foreign direct investment (FDI) flowing into the southern economic hub was US$6.1 billion in the first 10 months of 2018. 


To reach the targets for economic growth for the 2016 – 20 period, the southern province of Binh Duong will focus on eight major works this year to encourage new investment.

Provincial authorities will urge site clearance and facilitate construction work to improve the investment climate and help the private sector to develop.

The province will open industrial parks and zones to welcome new investment trends, said Mai Hung Dung, deputy chairman of Binh Duong People’s Committee.

In addition to efforts to improve the quality of urban management, Binh Duong will conduct research and invest in multi-mode transportation, and move polluting facilities in residential areas to industrial zones and parks.

Dung said the province will also improve the province’s public investment and accelerate construction of major work, and focus on training of human resources for the Industry 4.0 era.

The province has set 12 targets for sustainable economic growth, with major growth focused on the service sector.

It will also continue to invest in infrastructure, with the aim of turning Binh Duong into a first-grade city, thus contributing to efforts to improve the living standards of Binh Duong residents and to build Binh Duong into a smart city.

Binh Duong has targeted a GRDP (Gross Regional Domestic Product) of 8.4 – 8.6 per cent this year and per capita income of VND140 million (more than US$6,030).

The province’s socio-economic development attained significant growth last year. The province fulfilled 27 of 29 targets set by the provincial authority for 2018.

The Binh Duong Province’s Department of Planning and Investment also reported significant improvement in the investment environment, with total foreign investment (FDI) of more than $1.6 billion in the first 10 months of 2018, bringing total FDI registration in the province to $31.75 billion.

Phu Quoc boosts investment in socio-economic development

     

A view of Phu Quoc Island from the Hon Thom cable car.


Phu Quoc island district continues to deploy synchronous solutions, creating favourable conditions, supporting investors and enterprises to implement projects as planned, speeding up construction and contributing to local socio-economic development.

This was revealed by Phu Quoc Economic Zone management board in the southern province of Kien Giang, Vietnam News Agency reported on Monday.

In particular, the island is concentrating on investment capital to speed up the construction schedule to complete key infrastructure projects; overcome limitations and weaknesses in planning management, land, construction, compensation and site clearance; drastically handle disputes, compensation, clearance, resettlement and support for people to have "clean land" for investors to implement the projects.

According to the representative of Phu Quoc Economic Zone management board, investment attraction in Phu Quoc mainly focuses on tourism and marine economic development. Although a number of projects on the island have been granted investment policy decisions, the implementation of these projects is still slow.

The reasons include the compensation for site clearance, support and resettlement of projects takes a lot of time; disputes and complaints leading to land handover in the field face many difficulties and problems; coordination between investors and State management agencies is not synchronised, so some projects are encroached and re-occupied, causing difficulties and shortcomings in implementing projects in accordance with the plan.

In addition, the source of infrastructure investment capital of the Government has not met the demand for development investment, affecting the construction progress of key infrastructure projects compared to the plan. So far, Phu Quoc has paid compensation and support to more than 10,897 households, with an amount of over VND6.12 trillion (US$261.6 million).

Phu Quoc Economic Zone management board said that till date, Phu Quoc island has 299 valid investment projects in planning areas with a total area of 10,578ha. Accordingly, 258 projects were granted investment certificates, investment policy decisions, with a total area of 8,893ha, total registered investment capital of over VND270.3 trillion, and 41 projects are completing procedures.

Currently, 46 projects have been put into operation on an area of 1,200ha with a total investment capital of more than VND13.47 trillion. The other 41 projects are under construction, covering an area of 3,246ha with total investment of VND101.43 billion, including six partially operated projects, the remaining projects are completing investment procedures.

In addition, up to now, on Phu Quoc island, there are 31 foreign direct investment (FDI) projects with total registered capital of $293 million. 

Fair power pricing imperative

Power tariffs will undoubtedly rise this year, as both the Ministry of Industry and Trade and the Government reiterated last week on the move. The rationale behind the forthcoming power price hike is simple: selling prices are below production costs.

At a review meeting last Friday, Deputy Minister of Industry and Trade Do Thang Hai asserted his ministry would consider a power price rise for this year, taking into account all real costs in power generation and distribution, including the rising debt incurred by the sector due to foreign-exchange rate fluctuations associated with its investment since 2015. The ministry, however, said that the power price hike will not be scheduled for the time around the Lunar New Year holiday when prices of most commodities tend to surge.

One day earlier, Deputy Prime Minister Vuong Dinh Hue told a meeting on price management that the power price should be adjusted in such a way that it is appealing enough to lure investors into the power industry. The senior Government leader, however, demanded that input costs for the sector be controlled by relevant ministries in a transparent manner so that the higher price will not place a heavy burden on other business sectors and consumers.

Electricity is of paramount importance to national economic development, and the Government has required the Vietnam Electricity Group (EVN) under all circumstances to ensure sufficient power supply for the country. EVN and the Ministry of Industry and Trade have over the years called for investors to develop independent power plants, but it is reported that many investors have been lukewarm due to the unattractive power price.

EVN itself did make profit in 2017, but the State utility attributed its profit to other non-core business areas, while power generation and distribution as a whole were still in the red. As EVN is mandated to ensure sufficient power for the country, there is no reason why the power price is not set at a fair level to guarantee its profitability.

However, as power is an essential input for all economic sectors, a price hike will certainly hit enterprises and to some extent affect the competitiveness of businesses and the national economy.

As long as a competitive retail power market is not yet established, and as long as EVN still maintains its monopolistic position in the industry, there must be an effective oversight mechanism to ensure that a power price hike is not meant to offset poor performance and backward governance in the industry. In the past, local media pointed out how EVN has accounted into its input costs all unrelated expenses like the construction of a swimming pool or a tennis court.

A fair power price is imperative for all stakeholders, from EVN and new power investors to all other industries, consumers and the entire economy. Still, there must be an effective mechanism to ensure that any power price hike is conducted in a highly transparent manner so as to bring equitable benefits for all, not just EVN.

Votive paper manufacturer triples profits as people burn cash

An Yen Bai company that makes votive paper tripled its net profit to VND34.3 billion ($1.48 million) last year.

The Yen Bai Joint Stock Forest Agricultural Products and Foodstuff Company said in its financial report this was due to the rising demand for votive paper and no unexpected costs.

The management said the three main sources of income are votive paper or "ghost money", which is burnt as offerings to deceased relatives during rituals, the raw paper used to make votive paper and cassava starch.

In the fourth quarter of 2018 its revenues jumped of 20 percent year-on-year to nearly VND78 billion ($3.35 million).  

Full-year revenue was VND388.6 billion ($16.71 million), of which 23 percent came from exports.

It only supplies raw paper to the domestic market, and exports its votive products fully to Taiwan. 

The company, formerly known as Yen Bai Paper Factory, was established in 1972 in the northern mountainous province of Yen Bai as a state-owned paper mill. 

It was privatized in 2004 with a charter capital of VND5 billion ($215,000).

Every year local people burn millions of dollars’ worth of votive paper offerings.

Official figures from 2010 showed that every year people burned 50,000 tons of votive paper in the form of money, houses, cars, and iPhones.  

People in Hanoi spent the most, around VND400 billion ($17.2 million).

The practice is performed mostly by Buddhist followers, who number around seven million in Vietnam, and is met with criticism every year for its waste, although some people still see it as a deep-rooted part of their culture that should not be abolished.


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