Rubber companies in despair as price falls
As rubber companies totally depend on export price, they are likely to fail in achieving their business targets for this year, with rubber prices currently at their lowest.
Losing trend in the global rubber market started from 2012, mainly caused by the economic crisis, especially the sovereign-debt crisis in Europe which urged these countries to cut spending, seriously affecting automobile industry, leading to a slump in the rubber processing industry.
Experts forecast that rubber prices would rebound in the first quarter of this year as global economy showed signs of recovery and China was expected to gradually regain growth while rubber supply declined, as rubber trees entered a low-productivity period.
However, things happened differently. At the end of the first quarter of this year, RSS rubber future price on Tocom trading floor fell 16 percent compared to that in the beginning of this year, due to the ongoing European debt crisis, slow economic growth in main rubber consuming countries, and high inventory in China.
Currently, 90 percent of rubber production of Vietnam is for export. Therefore, global rubber price directly affects the country’s export turnover. Forecasts showed that rubber export volume this year will drop slightly compared to the previous year with 1 million tons, worth US$2.58 billion, down 10.5 percent compared to last year. Vietnam Rubber Group forecast that rubber exports will exceed $2.6 billion, down 6.6 percent over last year.
For now, there are five rubber companies listed on the stock markets, including Phuoc Hoa Rubber Joint Stock Company (PHR); Dong Phu Rubber Joint Stock Company (DPR); Tay Ninh Rubber Joint Stock Company (TRC); Hoa Binh Rubber Joint Stock Company (HRC); and Thong Nhat Rubber Joint Stock Company (TNC).
The area for rubber trees of most companies increased last year as they expanded growing area in Cambodia. Particularly, PHR enlarged 2,278 hectares in Kampong Thom and DPR added 1,300 hectares in Kratie.
As for TRC, according to a research by FPT Securities Company, this company has been putting all efforts in a project to grow rubber trees in an area of 7,600 hectares in Siem Reap. In comparison with total mature rubber tree areas in Vietnam of TRC of 5,407 hectares out of total rubber growing area of 7,300 hectares, the Cambodia-based project is considered as the most important project that affects the company’s development in the long term.
The company has had land allocated by the Cambodian Government, but it is still waiting for an investment certificate from Vietnam. Thus, TRC has been facing a few obstacles in transferring direct investment capital from Vietnam to Cambodia.
Although rubber growing area increased significantly, business performance in the first quarter for rubber companies remained slow as rubber export price declined. Of which, HRC saw a decrease of 97 percent in its income statement; PHR dropped 83 percent; and TNC plunged 75 percent. Hence, this year’s business result of rubber companies is expected to drastically drop compared to the previous year and the possibility that they will fail to achieve business targets looms large.
VietinBank partners with Japanese Finance Corporation
The Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) signed a cooperation agreement with the Japan Finance Corporation (JFC) in Hanoi on May 24.
Under the agreement, JFC will introduce VietinBank to small and medium-sized Japanese enterprises (SMEs) and issue Standby Letters of Credit (SBLC) to guarantee the enterprises’ VietinBank loans.
VietinBank and JFC also agreed to expand their information exchanges and supplementary service activities, as well as to introduce potential partners and share clients with each other.
Last year, Vietinbank sold a 19.73 percent stake to the Bank of Tokyo-Mitsubishi UFJ (BTMU), its Japanese strategic investor.
Vietnam, India sign maritime trade agreement
Vietnam and India successfully signed a maritime trade agreement in Hanoi on May 24 under the authority granted by the Prime Minister of both governments.
Vietnamese Minister of Transport Dinh La Thang and Indian Minister of Shipping Shri G.K.Vasan served as the agreements signatories.
The agreement is designed to expand maritime transport between Vietnam and India, promote bilateral economic exchanges and trade, and improve the Vietnamese maritime sector’s regional and international opportunities.
It will also provide a foundation for both sides to cooperate in shipbuilding and cadre and crew training exercises.
The agreement’s 18 articles aim to facilitate the transport of goods and passengers between India and Vietnam by allowing maritime transport companies to operate in each other’s territory in accordance with the laws and regulations of the applicable country.
Vietnam seeks France’s nuclear power technology
Vietnam wants to closely cooperate with France in developing its nuclear power projects.
Minister of Industry and Trade Vu Huy Hoang expressed his hope at a working session with former French Prime Minister Dominique de Villepin, who visited Hanoi recently.
France is a leading nuclear power producer in the world and Vietnam hopes to learn from its experience, Hoang told de Villepin.
Vietnam is currently working on Ninh Thuan 12 nuclear power plant projects in Ninh Thuan province, aiming to meet the country’s increasing demand for electricity at present and in the future.
At the meeting, Hoang acknowledged the efficiency of French-invested projects in Vietnam, saying as of March 2013 France had invested a total of US$3.1 billion in 383 projects in Vietnam, ranking 16th among foreign investors in the country.
He noted two-way trade between Vietnam and France has increased considerably over the years, reaching US$3.752 billion in 2012 alone.
Vietnam is also now the seventh largest recipient of official development assistance (ODA) from the French government.
Former French PM de Villepin said the government and businesses of France are paying attention to energy projects in Vietnam, and are willing to assist the country in developing its energy sector.
Agricultural exports hit US$10.7 billion
Agro-forestry and fishery exports fetched nearly US$2.2 billion in May, bringing their total five-month export earnings to US$10.7 billion, down 4.6% from a year ago.
In five months, the fishery sector raked in US$2.2 billion from exports, a year-on-year decrease of 5.6%. The US, Japan and the Republic of Korea, which are Vietnam’s leading seafood consumers, saw a considerable decline in their imports.
Vietnam shipped 2.86 million tonnes of rice abroad for US$1.265 billion, down 3.2% in volume and 7.9% in value.
Coffee businesses delivered 697,000 tonnes to foreign importers, earning US$1.49 billion, down 23.2% in volume and 21.7% in value. Germany and the US were Vietnam’s largest coffee consumers, making up 13.5% and 11.8% of Vietnam’s total export value.
Rubber earnings also fell 26.8% in value to US$759 million from exporting 287,000 tonnes, down 16.3% in volume.
To the contrary, tea, pepper, cashew nut and timber products saw impressive export growth.
Cashew nut exports increased 9.7% in volume and 0.8% in value to 85,000 tonnes and US$535 million.
Businesses earned US$446 million from exporting 68,000 tonnes of pepper in five months, up 13.9% in volume and 9.6% in value.
Five-month tea exports hit 48,000 tonnes, earning US$73 million, down 5.6% in volume, but up 1.3% in value.
Timber export earnings also rose 10.4% to US$2 billion in the reviewed period.
Vietnam invests in largest sugar project in Cambodia
The largest complex of sugarcane, ethanol and thermal power plants in Cambodia was inaugurated in Okrieng commune, Sombour district, Kratie province on May 26.
Addressing the ceremony, Cambodia’s Deputy Prime Minister Yim Chay Ly emphasized that the complex inauguration in Kratie was the outcome of the initiative between the two Prime Ministers of Cambodia and Vietnam.
The main investment came from Kamdhenu Ventures Cambodia Limited (KVCL) whtin the framework of a joint venture between Vietnam and a foreign company.
The factory, considered as one of the largest foreign-invested projects in Cambodia, has a total investment of around US$90.7 million, including US$25.3 million from KVCL and US$65.4 million from the Bank for Investment and Development of Vietnam (BIDV).
Construction work started in late 2010 on an area of 7.635 hectare with latest advances in Japanese and Indian technologies.
The sugarcane factory is designed to produce 3,500 tonnes of sugar per day while the ethanol and thermal power plants are expected to produce 30,000 litre of ethanol and 20MW per day respectively.
Apart from its economic efficiency, the complex creates thousands of jobs and generates around US$23 million in revenue to contribute to Cambodia’s state budget every year.
Also on May 26, representatives from the five-star international fertilizer group – one of Vietnam’s largest investors in Cambodia and KVCL signed a cooperative agreement to provide fertilizers for development of a sugar material zone.
Exports to Turkey continue to rise
Vietnam is the only Southeast Asian country that has achieved steady export growth in the Turkish market over the past four years.
The Turkish Statistical Institute reported that Vietnam ranks fourth among the ten Southeast Asian countries and 41st among all the nations exporting goods to Turkey.
Vietnam earned US$457 million from its exports to Turkey in 2009, up 2.2 percent from the previous year. The figure rose to US$751 million in 2010, up 64.3 percent, US$1 billion in 2011, up 34.3 percent, and US$1.2 billion in 2012, up 20.3 percent.
Indonesia was the leading Southeast Asian exporter to Turkey, followed by Thailand, Malaysia, Singapore, the Philippines, Brunei, Myanmar, Cambodia and Laos. However, their export growth fluctuated considerably.
Overall, between 2009 and 2012 Vietnam obtained the highest export growth of 165.6 percent in this European nation compared to Indonesia’s 76,2 percent, Thailand’s 37 percent, and Malaysia’s 33 percent.
Deflation deemed not too worrying
Although the national economy is not quite out of the woods yet, we are not too worried about deflation, said Deputy Prime Minister Vu Van Ninh.
Ninh played down the public’s increasing worries about the deteriorating health of the national economy after the General Statistics Office announced that the consumer price index (CPI) tumbled in May for the third consecutive month.
On the sidelines of the National Assembly’s current session, he told the media that the low CPI is mainly the result of falling food and foodstuff prices.
Deputy PM Vu Van Ninh is still upbeat about economic recovery in the long run (Photo:VNE)
“The industrial production index has already improved, and inventories are no longer as high as before,” Ninh said. “Credit growth has also slowed, but it is still higher than in the same period last year.”
He said the government is considering accelerating the VND30 trillion real estate bailout because the public has been complaining that the market is still stagnant. It is also planning to pool more resources to support the economy.
The National Assembly’s Economic Committee has proposed loosening the financial and monetary policy to ease difficulties and stimulate economic growth.
“Whether we loosen the policies or not should be carefully considered as specific inflation is low, but core inflation remains high,” said Ninh.
According to the Deputy PM, Vietnam should be cautious about the recovery of the global economy.
“Although the world economy is showing signs of recovery, it has yet to fully ride out the recession. If the recovery is on track, material and fuel prices will eventually go up.”
“The government will consider the NA Committee’s proposal to facilitate the national economy’s increased aggregate demand.”
Ninh further elaborated on ways to mobilise additional resources for the national economy that will not affect the National Assembly’s set public debt ceiling targets and budget deficit levels.
“The government manages its credit policy flexibly. It is fine if we meet this year’s 12% credit growth target and public debt is currently within safe limits.”
The Deputy PM, who is also the former Finance Minister, said the government plans to mobilise more resources to help the country weather the storm and it will propose that the legislature ease the debt ceiling slightly.
Five-month FDI hits US$8.5 billion
Vietnam has so far this year attracted US$8.517 billion in newly registered and additional FDI capital, up 8.9 percent over the same period last year.
Of the total, US$5.091 billion came from 398 newly licensed projects, up 5.8 percent, and US$3.426 billion was worth of additional capital from 160 operational projects, up 14 percent.
The processing and manufacturing sector took the lead, attracting US$7.6 billion in newly registered and additional capital from 191 projects, according to the Foreign Investment Agency under the Ministry of Planning and Investment.
It was followed by the real estate and wholesale, retails and repair sectors that attracted US$387.7 million and US$147.5 million in combined capital, respectively.
Japan topped the list of 40 foreign investors in Vietnam in the past five months, with newly registered and additional FDI capital totaling US$3.693 billion, accounting for 43.4 percent of total investment in Vietnam.
Singapore came in second with US$2.359 billion in FDI value and Russia ranked third with US$1.015 billion.
The Foreign Investment Agency reported that US$4.58 billion worth of FDI projects has been disbursed, a year-on-year increase of 1.6 percent.
FDI businesses are estimated to fetch US$32.741 billion from exports(including crude oil), up 23.3 percent against the same period last year and making up 65.56 percent of the country’s total export turnover.
They imported US$28.674 billion worth of commodities, up 25.4 percent and accounting for 55.29 percent of total imports.
Property investor seeks partners
Pacific Property and Infrastructure Development Joint Stock Company (PPI) is calling for investment into its two property projects in HCM City’s Thu Duc District.
The projects are the riverside complex Water Garden covering over two hectares and a 2,400-square-metre apartment project, PPI Tower, which will have 80 apartments and 8,000 square metres for office space.
Pham Duc Tan, chairman of PPI, said land had been cleared for the projects and investment procedures finished, but due to difficulties in the property market and difficulty in assessing capital sources, the firm was incapable of carrying out those projects on its own.
Therefore, PPI had called for investors who had financial capabilities and wanted to co-operate with PPI to develop them. Partners can choose suitable cooperation models, but the prior solution is to set up a joint venture, Tan said.
Work begins on tourism complex
Delta-Valley Binh Thuan Co Ltd has started work on the US$400 million Thung Lung Dai Duong (Ocean Valley) tourism complex in the south central province of Binh Thuan.
The project covers a total area of about 985ha in Tien Thanh commune and will provide entertainment spaces, parks, golf courses, restaurants, hotels, villas and trade complexes. It is expected to create 3,000 jobs when open.
Suppliers attend food safety course
Thousands of customers and food suppliers are learning about food safety at a mobile demonstration facility set up at Metro CashCarry Viet Nam stores in HCM City.
The demo facility will stay for two weeks at each of Metro’s stores and then will tour around the country. It is expected that 30,000 customers, employees, suppliers and students will take part in the training from now until 2014.
Launched last year, the training sessions are organised by the German Investment and Development Agency, Metro CashCarry Viet Nam, and Assist, a non-profit organisation.-
Malaysia Airlines offers package
Malaysia Airlines is offering package tours for three days and two nights to travellers from Kuala Lumpur to HCM City at US$292 from now until August 31.
Each tour covers a two-way economy class flights, airport tax and transfer and accommodation at Equatorial Hotel and daily breakfast. The airline operates three flights a day to HCM City.
Economy class and business class tickets for its flights from HCM City to Kuala Lumpur cost $136 and $331, respectively, from now until May 31.
MoU aims to boost energy efficiency
The Ministry of Construction signed a memorandum of understanding with the International Finance Corporation yesterday on implementing the Building Energy Efficiency Code of Viet Nam.
The ministry issued the code in 2005, aiming to improve energy efficiency in the engineering sector to reduce costs and greenhouse-gas emissions.
However, according to Nguyen Cong Thinh from the ministry’s Department of Science, Technology and Environment, the code has not been widely implemented due to a lack of both specific instructions and enforcement.
Making the comments at the MoU’s signing ceremony, Thinh said specific instructions will be published at the end of this year.
About 15 per cent of energy consumption per square metre of floor space is expected to be saved by 2017 in new buildings. Thinh said.
Authorities plan to have officials from construction departments in 63 localities along with teachers and students from the universities of architecture and construction in Ha Noi and HCM to be provided with more knowledge on energy efficiency.
Deputy Minister Phan Thi My Linh said the four-year MoU, which is set to end in June 2017, aims to help Viet Nam improve national strategies on green growth and energy efficiency.
Wendy Werner, the IFC’s investment climate change advisory services manager for East Asia and the Pacific, said a greater focus on energy efficiency will help building developers reduce operating costs and contribute to low-carbon economic growth.
According to Thinh, the engineering sector now accounts for about 36 per cent of national energy consumption.
The MoU has been implemented in partnership with the Government of Switzerland.
Petrol cuts help reduce CPI in May
The consumer price index in May inched down by 0.06 per cent against the previous month, making it the second month this year to show a decline, said the General Statistics Office (GSO).
The CPI in the first five months increased 2.35 per cent against December last year and 6.36 per cent against May last year.
Director of the GSO’s Price Derpartment Nguyen Duc Thang attributed the slight decline to two petrol price cuts late last month. Thanks to the cuts, transport prices declined 0.57 per cent in May.
A 0.35 per cent reduction in prices of food and restaurant services also contributed to the index’s slide in May, Thang said, adding that product prices even reduced during the country’s major holiday seasons in May including International Labour Day and Hung King Death Anniversary.
Housing and construction materials also saw a price reduction of 0.53 per cent while post and telecommunication was down 0.07 per cent in the month.
In May, except for medicines and health-care services, prices of seven remaining commodities and services used to calculate CPI increased 0.02 per cent to 0.41 per cent.
Prices of medicine and health-care services reported the highest rise of 1.58 per cent on the back of fee increase and rising demand due to summer diseases.
As May was the second month for a CPI decline this year, some people were concerned it was a signal of a stagnant economy.
Though the statitistics office hasn’t released the country’s GDP growth yet, enterprises said their production and business performance faced difficulties and they had to cut production due to high inventories.
Industrial production growth was mainly dependent on foreign invested firms, which created a low added value for the country. Vietnamese firms were facing more difficulties and had to gradually narrow their production.
However, experts recommended the Government insist on keeping the macro economy stable.
A report from the Institute for Policy and Development said the country’s GDP growth mainly depended on capital so that when the investment efficiency was low, it would cause a high credit demand and a high money supply, which were risks for high inflation.
The institute warned that, in the short term, targeting to meet both high economic growth and low inflation at any cost, risks falling into a spiral of high inflation and low economic growth.
VN eyes trade balance with China
Domestic firms have been urged to boost exports to China to offset Viet Nam’s huge trade deficit with the neighbouring country.
China is a large market with a high demand for products that Viet Nam specialises in, such as wood and furniture, agricultural products, foodstuff and raw materials, according to the China-ASEAN Expo (CAEXPO) Secretariat.
However, it said that only a few Vietnamese enterprises had successfully utilised opportunities to introduce their products and services to Chinese consumers.
As well as facilitating exports to China, Viet Nam has vowed to create favourable conditions for Chinese firms to develop industrial and export processing zones in the country.
According to the deputy general director of the Ministry of Industry and Trade’s Asia Pacific Market Department, Dao Ngoc Chuong, these conditions could support the industrial production and export processes.
Chuong also encouraged firms to improve the value of Vietnamese exports for which China has a long-term consumption demand or can re-export to third countries, arguing that this would gradually reduce the country’s trade deficit with China.
The General Department of Customs said Viet Nam’s trade deficit with its northern neighbour has hit US$6.55 billion already this year, an amount equivalent to 40 per cent of 2012 in its entirety.
During the period, Viet Nam exported only $3.88 billion worth of goods to China while its imports from the country stood at $10.43 billion, the department said.
Since 2000, the structure of Vietnamese goods exported to China, mainly including mineral resources, agricultural products and seafood, has remained unchanged. This is an explanation for the deficit with China rising from $210 million in 2001 to $16.39 billion in 2012, Chuong said.
During the eighth session of the Viet Nam – China Joint State Commission on Economic and Trade Co-operation held last month in Ha Noi, the two sides signed an MoU on bilateral co-operation in agro-products trading.
This was an important agreement helping the partners in this sector, especially as Viet Nam has the potential to boost the export of these products to China with a view to lowering the trade deficit.
Investors see many opportunities in Laos stock market
The Lao stock market holds opportunities for Vietnamese investors, with a newly born securities firm and a recent memorandum of understanding between the Lao Stock Exchange and Viet Nam’s bourses.
In March, Lao Airlines met with the country’s Securities and Exchange Commission Office to formally announce its intention to list.
There are currently only two listed stocks in the market: Banque Pour Le Commerce Exterieur Lao (BCEL) and electricity firm EDL-Generation (EDL-Gen). BCEL has fallen around 7 per cent since the beginning of the year, but EDL-Gen has risen 13.8 per cent.
Also in March, the Lao stock market welcomed a new securities company, Lao-China Securities Co Ltd. It expects to deliver a variety of services including brokerage and underwriting by July.
Another securities company – Lanexang Securities – is a partnership between Sacombank Securities (SBS) and the Lao Development Bank which opened in 2011.
On May 10, the Lao Stock Exchange met with the Vietnamese bourses to work on developing securities products and exchange of information. Accordingly, investors in Viet Nam can purchase Lao shares online via a system called “Home Trading”.
“The system will create more favourable conditions for Viet Nam – the 4th largest foreign investor the Lao stock market in 2012,” a representative from the meeting commented.
According to data from the Lao Stock Exchange, the current playground is dominated by foreign investors, who accounted for 58.46 per cent of the market last year.
However, foreign ownership is capped at 20 per cent in Laos.
The Lao government is considering increasing the cap following recommendations by its securities companies, but there has been no official decision.
The Lao stock market has high growth potential. It rose more than 35 per cent last year, becoming the 8th fastest stock market in the world, data from the Lao Stock Exchange showed.
As of yesterday, the LSX Composite Index had grown over 11 per cent since the beginning of this year.
Gasoline import tax cut to 18%
The Ministry of Finance on Thursday issued circular 70/2013/TT-BTC to adjust the gasoline import tax to 18 per cent from previous 19 per cent.
The circular took effect immediately.
Goods that are subjected to import tax are: gasoline, tetrapropylen; white spirit, and other solvents such as naphtha, reformate and alpha olefin.
This is the first decline of gasoline import tax so far this year.-
Bad debt causes bank shares to lose lustre
Bank shares are losing their attraction due to low profits caused by increasing bad debt in many lending institutions.
Although shares listed remain stable, it is not easy for them to rise in the sluggish market.
Finance experts think local banks, especially the big ones, have potential growth. However they also predict that banks profits will be less, making their stocks less attractive.
For example, Eximbank is considered one of the top banks with an expected dividend rate of 12 per cent. It plans to have pre-tax profit of VND3,200 billion(US$152.3 million) this year, an increase from VND2,828 billion ($134.6million) in 2012.
However, bank chairman Le Hung Dung says the bank is under pressure to complete the above target. He said that if Circular 02/2013/TT-NHNN of the State Bank on bad debt classification and risk management in the banking system is applied this June, his bank’s profits will definitely be affected.
“In the first four months, Eximbank has only VND500 billion($23.8million) in pre-tax profit, failing to meet its target. If bad debts increase, Eximbank will have to reduce dividends.
In the same situation, Sacombank only set its target of VND2.8 trillion($133.3million) this year. Sacombank chairman Pham Huu Phu said the current bad time plus debts made it hard to achieve high returns. Like Eximbank, Sacombank thinks it must spend more on the provisional fund. This year, Sacombank expects to have the dividend of 9-10 per cent.
Despite complaining, Eximbank and Sacombank are still doing much better than other small banks whose dividend rate to shareholders were reduced significantly, even much lower than the saving rates of 7.5 per cent per year.
Dividends in the Southern Bank in 2012 was 2.1 per cent, in the Mekong Bank 3 per cent and in Nam A Bank more than 3 per cent.
Besides bad debts, the current trend of bank restructuring and mergers also directly impacts on shares of small banks, which merge to become stronger.
Le Xuan Nghia, former vice chairman of the National Financial Supervisory Commission, said bank restructuring put so much pressure on small banks and the trend would increase in the near future.
Nghia also said bank stocks could not gain points at present.
TrustBank approved to rename
Dai Tin Commercial Joint Stock Bank (TrustBank) on Thursday received approval from the State Bank of Viet Nam (SBV) to change its name to Viet Nam Construction Joint Stock Commercial Bank (Viet Nam Construction Bank).
Accordingly, the southern-based bank shall register with the competent State agency; disclose information; amend related articles and clauses in its charter; register amended charter as prescribed.
Viet Nam Construction Bank will focus activities on providing unique banking services to corporate clients operating in the fields of manufacturing and trading building materials and constructing social houses.-
Travelport hooks up with Gallileo
A global provider of transaction processing solutions and data for the tourism industry, Travelport, has signed a new contract with Gallileo.
With this 10-year contract the company will continue being the national distributor of the former’s technology and services.
Gallileo Vietnam chairman Pham Van Hien said his company had brought the Gallileo global distribution system to almost 500 travel agencies in Viet Nam, Laos and Cambodia.-
Property price index falls
The price index for residential properties fell in Ha Noi and HCM City, according to the Savills Property Price Index released early this week.
The SPPI, based on Savills Vietnam’s statistics in Q1, shows that the residential index for HCM City stood at 89.2, a slight decrease of 0.4 per cent quarter-on-quarter (QoQ) and 3 per cent year-on-year (YoY). The majority of projects that had price reductions still had sluggish performances.
Meanwhile, the Ha Noi index was 108.3, a drop of 6.4 per cent points QoQ and 16.7 per cent YoY. The index has decreased for seven consecutive quarters by approximately 22 per cent since its peak of 138.7 in Q2/2011.
Licensed software could pay dividends for economic growth
A 1 per cent rise in the use of properly licensed software would add US$50 million to Viet Nam’s economy, according to a new study
The study by Software Alliance (BSA) and INSEAD, one of the world’s leading business schools, found that a 1 per cent increase in the use of licensed software would generate an estimated $87 million in national production, compared to $37 million from a similar increase in pirated software.
The study, entitled the Economic Impact of Properly Licensed Software, draws on data from 95 economies, including 15 in the Asia Pacific.
“Using properly licensed software reduces risk and creates operating efficiencies that go directly to the bottom line for enterprises,” said Roland Chan, BSA’s marketing director for Asia and the Pacific.
Cloud security software helps protects business data
Trend Micro, a global leader in cloud security, introduced a Worry-Free Business Security Version 8.0 in HCM City yesterday.
Providing fast, effective and simple security, the version 8.0 offers a comprehensive solution to help small- and medium-sized enterprises to protect their data from viruses, threats, and dangerous websites.
The new version can be used for all Windows, Mac and Android devices.
According to Trend Micro, the solution helps companies manage all of their devices from any location.
It is powered by the Trend Micro Smart Protection Network, a worldwide early warning system that blocks threats before they can reach computing devices.
“One of the important things is that the solution can block employee access to unwanted websites. It works with Windows 8 and integrates with Microsoft Windows Servers 2012,” said Ngo Viet Khoi, director of Trend Micro in Viet Nam and Cambodia.
Little growth in bank capital, assets during first quarter
Assets and capital owned by lending institutions showed little progress in the first quarter, although the data in March improved significantly compared with the previous month.
This was reported by financial website cafef.vn, citing sources from the State Bank of Viet Nam.
In March, the total asset value of all institutions increased nearly VND137 trillion (US$6.5 billion) over February. It was up VND60.8 trillion ($2.9 billion) over the end of last year.
Assets of State-owned commercial banks added about VND64.6 trillion ($3.1 billion) in March to reach VND2,200 trillion ($104.8 billion), but this value rose by only VND1.4 trillion ($66.7 million) from last December’s figure.
Assets of joint stock commercial banks rose sharply in March by VND42.9 trillion ($2 billion), but increased only VND16.4 trillion ($781 million) in the first quarter, reaching about VND2,180 trillion ($103.8 billion) on March 31.
Central credit funds and joint-venture banks posted high asset-value growth rates in the quarter at 10 per cent and 7.3 per cent, respectively, but with small market shares, they couldn’t help drive up total assets of the whole banking system.
Total equities of lending institutions slumped more than VND10.7 trillion ($501 million) in the first quarter, although their combined ownership capital went up VND1.7 trillion ($81 million) in March.
Equities of joint stock banks alone dropped by VND10.3 trillion ($490.5 million), making up 96 per cent of the total decline. Only joint-venture banks witnessed ownership capital rise by VND2.4 trillion ($114.3 million) in the quarter.
Last year, the return on assets (ROA) ratio of the whole system reached 0.48 per cent and the return on equity (ROE) reached 3.97 per cent.
The profitability indicators were 0.76 per cent and 11.37 per cent for State-run banks and 0.22 per cent and 1.36 per cent for joint stock banks, respectively.
For financial companies, the indicators declined 0.48 per cent and 3.97 per cent, respectively.
Capital city faces tax collection difficulties
Capital city authorities are facing a tax shortfall from local businesses, especially in real estate, as the country continues to battle the global economic downturn, according to the Ha Noi Taxation Department.
As of May, the city tax department had collected VND1.873 billion (US$89 million) in land use tax, just 61 per cent of the figure from the same period last year.
Tax collection from land leases jumped by VND495 billion – an increase of 31.35 per cent over the same period last year – but only accounted for 45 per cent of the total estimated tax collection.
Tax collection from non-agricultural land use is estimated to raise VND42 billion, accounting for 17.1 per cent of the total collection.
The Ha Noi Taxation Department said it had continued to work closely with relevant agencies in managing State revenues in order to promptly collect arrears.
The department predicted that if the real estate market remained sluggish, real estate businesses would not have enough money to pay their taxes.
Promotions focus on city’s SMEs
The capital city plans to launch major promotional activities to stimulate consumer demand for products from small and medium-sized businesses (SMEs).
A conference here yesterday was told that the Government would spend VND3 billion (US$140,000), including about VND1.2 billion from its budget, on the promotions.
The small businesses operate in the fields of food, beverage, essential goods, fashion, garments and textiles, footwear, household devices, interior decoration, arts and handicrafts, automobile, motorbike, hotel and restaurant services.
The conference was told that SMEs faced cumbersome administrative procedures, difficulties in accessing loans, production space shortages and high inventories.
Trung Thanh Co general director Phi Ngoc Chung said that most commercial banks were devoted to large enterprises, making it hard for small businesses to access loans.
He said that to take advantage of low interest rates, it was still hard for SMEs to meet all bank conditions.
Municipal People’s Committee vice chairman Nguyen Van Suu said that the capital would send seven teams, including representatives from departments and sectors, to work directly with local enterprises to remove obstacles to business development and foster growth in production.
He said attention would be given to improving investment and business climates and creating more favorable conditions for firms. This would include trade promotion programmes to help reduce high inventories.
Foreign firms expect benefits from trade pact
A proposed trade deal between several Pacific rim countries is expected to benefit foreign businesses based in Viet Nam, whether or not they are from member countries.
The news was released at a forum organised by the American Chamber of Commerce (AmCham) in HCM City last Friday.
The Trans-Pacific Partnership (TPP), which is being negotiated, would make it easier to find partners once the tariffs are cut by the members, Josephine Yei, a representative of the Malaysia Business Chamber, said.
Viet Nam’s major export items like garment, seafood, and processed materials would meet fewer barriers and Malaysian businesses in these industries would benefit from the TPP, she said.
The admission to the TPP would require Vietnamese authorities to improve the country’s legal framework, which would enable Malaysian businesses to gain better protection and access to proper channels for handling trade disputes and arbitration, she added.
But Malaysian businesses would still have some concerns since under the trade deal workers would have the right to set up unions and negotiate the provisions of their labour contracts with employers.
In a country they find attractive because of the “easy access” to labour, they fear this could make things harder for them in the future, according to Yei.
Considering the potential of the TPP, there should be more FDI coming into Viet Nam in the coming years, according to Chen Hsin-Ming, chairman of the Council of Taiwanese Chamber.
For instance, his organisation has noticed that some Taiwanese investors in the textile industry plan to enlarge production in Viet Nam.
“We have noticed some large investors conducting comprehensive feasibility studies for investment in this country. “They are looking at enhanced market access opportunities once tariff elimination or reduction under the TPP is in effect.”
Taiwan is the second largest investor in Viet Nam with over US $27 billion in more than 2,230 projects.
Antony Nezic, vice president of the Canadian Chamber of Commerce, said the TPP offers an opportunity to advance Canadian interests in the Asia-Pacific, which is one of the fastest-growing regions in the world and a key driver of the global economy.
It also offers Canada a foothold in the burgeoning Asian market and access to critical Asia-Pacific value chains, he said.
Asia is expected to represent two-thirds of the world’s middle class by 2030 and 50 per cent of global GDP by 2050.
Junn Huyn Soo of the Korea Chamber of Commerce, who is also the chairman of the 500-strong Korean Textile and Garment Association here, said: “The essence of the TPP is to provide a winning strategy for all Pacific nations.”
The agreement would contribute to Viet Nam’s economic growth, he said.
Last year the country exported textile and garments worth $15 billion, of which Korean firms accounted for around 30 per cent.
Korean textile and garments firms plan to double their investment in Viet Nam in the short term to avail the great opportunity offered by the TPP, he revealed.
The 17th round of TPP negotiations was held in Peruvian capital Lima from May 15 to 24, with negotiators planning to complete work on some chapters and accelerate progress on more challenging issues like intellectual property; competition/State-owned enterprises; environment; market access for goods, services, and investment; and government procurement.
Also on the agenda are trade in services, rules of origin, competition, and labour standards.
They hope to hammer out solutions to sensitive issues so that after the 18th round in July, everything will be ready for the political decisions that need to be made for a comprehensive agreement that can be signed this year at the October 1-8 APEC Leaders Meeting in Indonesia.
The TPP will bring together the US, Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Viet Nam.
In April, Japan indicated it wanted to be part of the TPP.
New finance minister aims to balance budget
Newly-appointed Minister of Finance Dinh Tien Dung has said that finance authorities would continue with tight fiscal policies to stabilise the economy, control inflation and accelerate growth.
In what his termed “a major direction” for coming months, he said top priorities were to balance State budget revenues and spending, intensify fiscal discipline and guarantee transparency in policy implementation.
“I’ll spend most of my time studying measures to handle tax-revenue losses, assuring national financial security, innovating tax and fee policies, and enhancing price-management for essential goods such as petrol, electricity and public services,” he said.
He said the ministry would continue to help enterprises solve difficulties, assist markets and deal with bad debts.
It would also promptly apply revised laws on corporate income and value-added taxes if they were adopted by the National Assembly.
In a context that this year’s State budget balancing goals were difficult to be achieved — according to a recent Government report before the NA — Dung said major solutions should be solving budget losses, economising expenses, and stimulating production, business development and consumption.
He said social welfare and important projects would be given priority while cutting car purchases, meetings and the use of power, water and phones.
Former State Audit chief Dinh Tien Dung assumed the ministerial office last Friday.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR