Mobile phone exports target US$20 billion
Mobile phone and spare parts are likely to top the list of Vietnamese export items for the first time, with their export earnings expected to hit US$20 billion in 2013.
Vietnam raked in US$13.07 billion from exporting these products in the first nine months of this year, and the US$20 billion target is within reach, according to experts.
Statistics show the export value of mobile phones and spare parts increased 21.45 times from 2009 to 2012, or 177.8% year on year on average.
In 2009, these products ranked 9th among the country’s top 10 export items behind garments, footwear, crude oil, seafood, electronics, computers and spare parts, wood and wood products, rice and rubber. One year later, they climbed to fourth place after garments, crude oil and footwear.
They were placed second behind garments in 2011 and 2012, but jumped to top in the first nine months of 2013.
Worthy of note is that foreign-invested businesses accounted for 99.2% of the total export value of mobile phones and spare parts.
The high export growth was attributed to the operation of phone handset manufacturing projects in Bac Ninh province, making Bac Ninh the country’s second largest hard currency earner (US$15.5 billion) after HCM City (US$20 billion) between January-September 2013.
The European Union was the largest importer of Vietnamese mobile phones and spare parts, consuming US$5.4 billion in the past nine months, a year-on-year increase of 71%. It was followed by the United Arab Emirates (US$2.27 billion and up 156%), India (US$642 million and up 163%), Hong Kong (US$554 million and up 63.5%), and Russia (US$525 million and up 18.8%).
MoF examines ways to restructure tax debt
The Ministry of Finance (MoF) has proposed rescheduling tax debt repayment terms for ailing businesses which would be able to commit to paying tax in the future.
The proposal was made against a backdrop of skyrocketing tax debts as enterprises have toiled in the face of an economic downturn.
The ministry’s report showed that by the end of this year’s second quarter, tax debt collection had faced significant obstacles.
Over 25,000 firms were found to have a total tax debt of VND4.4 trillion (US$209.5 million). Meanwhile, only 32% of last year’s tax debts were collected by December 2012.
In addition, a large number of companies trying to avoid paying tax debts was making collection extremely difficult, according to the report.
Vu Vinh Phu, former director of the Hanoi Department of Industry and Trade, said enterprises had been asked to report reasons for their tax slow repayment to authorities.
Phu said real estate firms accounted for a large portion of the tax debt list and authorities should carefully check whether the debts were due to frozen property market or simple negligence.
He added that businesses would have to explain reasons for slow tax payments or they would face bankruptcy to avoid becoming antecedent for others.
Sharing these thoughts, lawyer Bui Dinh Ung said State management agencies should carry out check-ups at businesses to impose penalties on tax cheats.
Another lawyer Tran Dinh Trien added that enterprises would be allowed to restructure production to facilitate their tax obligations.
Finance Minister Dinh Tien Dung said the ministry had asked its Taxation Department to restructure tax debt for certain cases.
Head of the department Bui Van Nam said authorities had calculated and researched plans to clear unrecoverable tax debts and tax penalties due to late payment would be wiped clean.
Debts incurred after the beginning of July this year would incur a late payment charge of 0.05% per day for the outstanding tax from the payment deadline up to 90 days over. From day 91 onwards, a 0.07% rate would be applied each day thereafter, he revealed.
Vietnam elected to WIPO budget committee
Vietnam has been elected to the Programme and Budget Committee of the World Intellectual Property Organisation (WIPO) for 2013-15 at its ongoing 51st General Assembly in Switzerland.
Ta Minh Quang , Head of the National Office of Intellectual Property of Vietnam, said since Vietnam joined this organisation in 1976, it has actively involved in all WIPO-funded development programmes, and its contributions have been acknowledged internationally.
At the General Assembly session, Quang introduced two WIPO projects Vietnam is carrying out efficiently in the country.
In the first project, WIPO supports several developing and underdeveloped countries in drawing up a branding strategy to promote local specialities and boost their exports.
In Vietnam, Ba Vi tea, Phu Yen fish sauce and Da Lat flowers are benefitting from this project.
In the second project, WIPO helps the countries establish Technology and Innovation Support Centres (TISC) with access to locally based, high quality technology information and related services, in order to create, protect, and manage their intellectual property rights.
Under an agreement signed with the National Office of Intellectual Property of Vietnam, WIPO has pledged to support Vietnam in establishing an intellectual property rights support centre at Hanoi’s Hoa Lac hi-tech park.
It has run a number of workshops providing the Office’s staff with basic skills to access online patent and non-patent (scientific and technical) resources and industrial property-related publications.
Businesses seek to penetrate UAE
Businesses in Can Tho city will greatly benefit if they are able to penetrate the Dubai market, a workshop was told in the city on September 27.
Dubai, one of the seven emirates that make up the United Arab Emirates (UAE), is an important gateway to the Middle East and North Africa.
Vietnamese businesses and those in the Mekong Delta in particular, however, are facing tremendous difficulties as a result of the global economic recession and technical barriers when entering choosy markets like the US, EU and Japan, said Deputy Chairman of the municipal People’s Committee Dao Anh Dung.
In addition, they have yet to fully penetrate such affluent and stable markets as the Middle East, North Africa and the Gulf Cooperation Council (GCC) grouping Saudi Arabia, Bahrain, Kuwait, Oman, Qatar, and the UAE.
The workshop, therefore, is a rare opportunity for local business players to explore ways to pierce these emerging markets.
Director of the LP Vietnam Academy of Entrepreneurs Nguyen Lien Phuong cited rice, seafood, processed farm produce, construction materials and green bonsai as the export strengths of Can Tho city and Mekong Delta provinces, while the aforementioned markets are assessed as those with strong purchasing power.
Vietnam’s exports to Dubai have seen rapid growth in recent years, from US$2.3 billion in 2012 to an expected US$4.2 billion this year.
Lord Puttnam’s visit to promote UK business in Vietnam
The UK Prime Minister’s Trade Envoy to Vietnam, Laos and Cambodia Lord Puttnam of Queensgate will visit Vietnam next week to ramp up UK business in Vietnam.
He will take part in a GREAT Week initiated by the UK Trade and Investment to give UK-based businesses the opportunity to join government-led trade missions to meet major buyers, potential partners and influential opinion formers in market.
GREAT WEEK activities, taking place in Hanoi, Danang, and HCM City from September 29 to October 5, will include a seminar, networking event, one-to-one meetings and UK Film Week.
Lord Puttnam’s role is to promote trade for UK businesses in Vietnam which has been recognised by the UK Prime Minister as one of the selected high-growth and developing markets around the world.
Lord Puttnam is an award-winning producer of films including The Mission, The Killing Fields, Local Hero, Chariots of Fire, Midnight Express, Bugsy Malone and Memphis Belle. His films have won ten Oscars, 25 Baftas and the Palme D’Or at Cannes.
He retired from film production in 1998 to focus on his work in public policy in education, the environment, and the ‘creative and communications’ industries.
He is a member of the advisory panel to the UK-ASEAN Business Council.
Hanoi hosts int’l food supplements festival
Two hundred booths and display stalls representing 150 domestic and foreign enterprises joined Hanoi’s International Food Supplements Festival, underway from September 27-29.
Vietnam Association of Functional Foods (VAFF) President Tran Dang expects the event will attract more than 80,000 visitors over its three days.
Dang told press the festival is anofficial forum offering diatery supplement producers the chance to connect with a diverse range of consumers.
The Vietnamese availability of nutritional supplementshas boomed during the last 10 years, fuelled by both renowned foreign brands and domestic producers.
By last December, approximately 1,600 businesses were distributing more than 5,500 kinds of supplements to local customers.
Around six million people report using supplements regularly, 43 percent of whom reside in urban areas.
The festival promotes milk, grains, tea, sports drinks, and health food products tailored to strengthening the immune system. It also includes an award presentation ceremony and seminars on the Vietnamese food supplement industry’s strategy for development.
Coffee exports hit US$2.21 billion in 9 months
Vietnam exported 1.03 million tonnes of coffee worth an estimated U$2.21 billion after nine months—down 23.1 percent in volume and 22.5 percent in value over same period’s last year.
The Ministry of Agriculture and Rural Development (MARD) has predicted that September’s coffee exports are expected to reach 61,000 tonnes, a year-on-year decrease of 27 percent.
Germany and the US remained Vietnam’s largest coffee importers in 2013’s first eight months, buying 12.9 percent and 11 percent of exported volume respectively.
Coffee exports to Russia rose by 12.9 percent, to the UK by 6.7 percent, and to Spain by 2.1 percent.
Average export prices of US$2,145 per tonne saw a slight 1.19 percent improvement on 2012.
But in Dak Lak province, coffee prices fell VND600 to VND36,100 per kilo due to falling prices in the global market.
The London market is predicting Robusta coffee prices will drop US$46 to US$1,663 per tonne in November, before falling an additional US$37 to US$1.671 per tonne by January 2014.
Japan profiles Vietnam’s software outsourcing market
A September 27 report in the Japanese newspaper Nihon Keizai has declared Vietnam’s software outsourcing market remains attractive to Japanese businesses, noting its human resource costs are only 60 percent of those in China and India.
Between 70–80 Japanese information technology companies are currently invested in Vietnam
An additional 20 have indicated plans to join their compatriots, doubling 2012’s new investment figure.
Japan’s leading telecommunications company Softbank is quoted as saying one of its best-selling software applications was programmed by Vietnamese technicians. GMO Internet Company made its first Vietnamese investment in 2011.
It now employs220 programmers and expects to hire 80 more in the near future.
Around 200,000 Vietnamese workers have completed courses run by information technology training centres.
Japanese language students in Vietnam hovers at 46,000 compared to Indonesia’s 870,000 and China’s more than one million.
But Japan External Trade Organisation Investment Consultant Yoshitaka Kurihara is confident Vietnam can provide the necessary numbers of adequately qualified staff.
He says Vietnamese employees are also typically very fast learners. Vietnam’s preferential tax rates are another feature fuelling Japanese investment enthusiasm.
IT businesses are currently taxed at 25 percent, scheduled to drop to 22 percent from 2014. Businesses are granted tax exemptions for their first four years and at 50 percent of the full rate for the five years following. Renting Vietnamese workshop and office space is also comparatively cheap.
Strengthening macroeconomic stability through monetary and fiscal policies and speeding up the economic restructuring topped the agenda of the ongoing 2013 Autumn Economic Forum in the central province of ThuaThien-Hue.
The September 26-27 forum, themed “Vietnam Economy 2013 – Prospects for 2014: Striving to Implement Three Strategic Breakthroughs”, focuses on seeking major measures, especially middle-term solutions for the Vietnamese economy.
The State and Government should have flexible policies to deal with bad debts, such as settling debts for enterprises or making breakthroughs in some stages, said Ass. Prof. Dr. Tran DinhThien, Director of the Vietnam Institute of Economics.
Sharing this view, Dr. Tran Du Lich from the NA Economic Committee said Vietnam’s economy has not yet escaped from stagnation, which resulted from its inner factors including shortcomings in economic structure and growth model, inadequate perception on the “illness” of the economy, and lack of long-term measures.
He stressed that maintaining macroeconomic stability, accelerating economic structuring and building market confidence remain the leading goal in the time ahead.
At the forum, delegates suggested a harmony between goals on economic growth and stability, and inflation prevention.
It is necessary to maintain total social investment capital at an appropriate rate to help businesses develop, they said, adding that if not, enterprises will fall into capital exhaustion, resulting in unemployment and loss of budget revenue.
They agreed that in 2013, the Vietnamese economy has become stable with lower rate of inflation, low trade deficit and high surplus. However, it is forecast to continue growing slowly in short and medium terms due to high inventories and bad debts in the real estate market and investors’ falling confidence.
The forum is jointly organised by the National Assembly Economic Committee, the Vietnam Academy of Social Sciences, the Vietnam Chamber of Commerce and Industry (VCCI) and the United Nations Development Programme (UNDP) in Vietnam.
Foreign funds for weak banks hard to find: SCB
Standard Chartered Bank (SCB) in a recent report deems it difficult for weak banks to lure foreign capital investment even though the Government is going to unveil many regulations to help weak banks sell their stakes to foreign investors and two banks have already found the stake buyers.
As per the report, there are still concerns over a big debt ratio announced by the local banking system which is still struggling with the lack of recapitalization plans. Small and weak banks might have higher bad debt ratios than the average rate and are not ready for lending due to higher deposit rate payments while larger lenders have obtained strong credit growth in line with the Government’s target of 12% set for 2013.
According to the report, as the Government highly appreciates the participation of foreign investors in buying bad debts or stakes in local banks, it is now considering raising the maximum stake for foreign investors at a credit institution to more than 30% on a case-by-case basis.
SCB noted a disparity between bad debt ratios recorded by local banks and the State Bank of Vietnam (SBV). While most big banks reported their bad debts ratios at less than 3% out of the total loan balances in this year’s first six months, the bad debt ratio of the whole system reported to the SBV was 4.46% and the figure estimated by the SBV as of June 30 was higher, at up to 6.6%.
SCB said that it and Fitch supposed the ratio might be several times higher than the aforesaid figures.
Furthermore, deploying strict instructions on bad debt classification and extracting risk provisions are put on hold until June, 2014, SCB said.
SCB expressed its optimism about the relative stability of the Vietnam dong exchange rate recorded since early last year.
The bank ascribed the stability to the inconsiderable gap between foreign exchange rates in the official markets and in the unofficial ones for a long time and U.S. dollar deposit rates offered by banks lower than dong deposit rates discouraging foreign currency holdings. Besides, a sharp fall in U.S. dollar demand in the official economic areas has also helped stabilize exchange rates in recent months.
Given the factors, SCB expected Vietnam’s foreign reserves at some US$30 billion, equivalent to the country’s two-and-a -half -month import value.
SBV in a recent report informed that only one weak lender among nine lenders subject to the restructuring plan since 2011 is now awaiting the Prime Minister’s instruction on self-consolidation using capital of foreign credit institutions.
In related news, an SBV official told the Daily that Saigon Commercial Joint Stock Bank merged from Vietnam Tin Nghia, De Nhat and the former Saigon Commercial Joint Stock Bank was consulting a foreign partner intending to restructure the lender and purchase its stakes.
Vietnam still in difficulty despite macroeconomic improvements
Macroeconomic indicators in the year through September have changed for the better but whether the economy has improved remains questionable, according to the Ministry of Planning and Investment.
The ministry in a report presented at a meeting on Tuesday showed that the January-September Index of Industrial Production (IIP) is up 5.4% year-on-year. Meanwhile, according to the report, power and gas consumption marked up 8.3%, with power volume consumed by the manufacturing and construction industries surging nearly 8.6% year-on-year.
At the meeting, Bui Ha, director of the Department for National Economic Issues under the ministry, said: “This year’s power consumption being higher than that in the same period in 2012 indicates manufacturing and construction and agriculture and fishery industries are recovering.”
As per the report, the country’s GDP has grown an estimated 5.14% in the first nine months, with services posting the highest growth, at 6.25%, followed by manufacturing and construction with 5.02%, and agriculture and seafood with 2.39%.
According to Ha, the nine-month export value was estimated at US$96.5 billion, increasing 15.7% year-on-year, while the nation’s import spending totaled some US$96.6 billion in the same period, soaring 15.5% year-on-year. In particular, the foreign direct investment (FDI) sector posted a trade surplus of roughly US$4 billion exclusive of crude oil exports, he said.
The report demonstrates that outstanding loans in the banking system have picked up over 6% as of this month, which is expected to continue to rise an extra 4-6% towards the year’s end. There are 872 FDI projects having been licensed in January-September with total registered capital of US$9.3 billion, leaping 35% year-on-year, while only 58,000 new companies have been established, says the report.
Still, Deputy Minister of Planning and Investment Dao Quang Thu expressed his caution towards the positive results. “There are still contradictory evaluations on the economic situation. Many say that the economy has recovered from the bottom given important indicators growing steadily month-on-month while others argue that the situation has yet to improve as the steady economic growth over the months is as normal as has been seen in previous years,” he said.
Thu posed a question to representatives of provinces at the meeting: “Is the economy improving or is it still struggling?”
A delegate from HCMC responded that the city’s government had boosted the connectivity among local commercial banks and enterprises in 24 districts citywide but only 415 companies and 600 production households took out credits totaling around VND8.7 trillion from the special program. The delegate ascribed the poor result to the fact that local firms see no need to borrow money from banks to expand production as they are sitting on a mountain of inventories.
This year’s economic growth target is 5.5% but the planning ministry has recently predicted the actual figure might be 5.3% at best.
Policy predictability vital for auto industry
Vietnam should quickly determine a tax policy for the local auto industry that should be more predictable, otherwise local manufacturers will be at a loss when import tariffs are all brought down to zero in 2018, said an automaker.
Jesus Metelo Arias, general director of Ford Vietnam, told the Daily that industry players find it hard to set up their own development paths due to unclear and fast-changing policies of the country regarding the auto industry.
Vietnam is a sizeable auto market, but how it will develop depends on the Government’s planning policies and how such policies are implemented, said Arias, who also serves as chairman of the Vietnam Automobile Manufacturers Association (VAMA).
He noted that the policy and orientation for the auto industry on the part of the Vietnamese Government have not been well-established.
VAMA has had several seminars and dialogues with the Government to look for solutions to enhance the local auto industry’s competitiveness as the deadline of 2018 is drawing near when auto import tariffs will be slashed to 0% under Vietnam’s commitments to the ASEAN Free Trade Area (AFTA), he said.
There have been two scenarios discussed, one on maintaining the high rates until 2018 and the other on gradually bringing down the tariffs to zero upon the deadline. However, the Government has not given its final say on the matter.
Arias commented that the local auto industry has experienced a rocky path of development due to unpredictable tax policy changes, which have given concerns to those local automakers who want to make in-depth investments here.
Vietnam imposes higher taxes on autos than other ASEAN peers, which erodes the competitiveness of local products.
Arias argued that higher taxes did not mean higher revenue for State coffers, citing a study by the Ministry of Industry and Trade to conclude that a lower tax regime would do better.
The Ministry of Industry and Trade in a draft estimates that if the special consumption tax on autos is halved, the auto industry will contribute an additional tax revenue equivalent to some 1% of the nation’s gross domestic product (GDP). “As such, revenue for the State budget will increase if taxes are cut,” he said.
Arias stressed VAMA’s viewpoint that the Government maintain a consistent tax policy towards the auto industry.
“The key point that VAMA wants to recommend to the Government is the predictability and stability,” he said, adding the Government needs to take a long-term vision, not just with AFTA but also other trade agreements like the one with the EU, the future Trans-Pacific Partnership agreement, and other WTO conventions.
The Government should have a long-term, overall viewpoint, creating a concrete roadmap so that automakers can prepare themselves and make their own plans for development to sharpen their competitiveness, he said.
Rice yield restriction may not help raise farmers’ income
Local experts on Tuesday cast doubt on a plan by the agriculture ministry to raise farmers’ income by cutting the area under rice cultivation to prevent an oversupply, saying the market volatility cannot be explained so plainly.
At a conference reviewing this year’s rice production held in the Mekong Delta province of Tra Vinh on Tuesday, the agriculture ministry presented a plan for reducing rice farming to increase incomes for farmers. Under the plan, the rice farming area in the southern region will be scaled down by about 3,260 hectares next year.
Le Thanh Tung of the Cultivation Department under the ministry informed that the winter-spring crop 2012-2013 in the country’s south was expanded by over 20,800 hectares against last year, with its total yield expected to rise 650,000 tons year-on-year. Meanwhile, rice exports are still struggling, leading to volatile incomes for rice farmers in the region, he said.
Truong Thanh Phong, chairman of the Vietnam Food Association, told the conference that the rice trade was depressed due to a global oversupply, with the stockpiles in Thailand and India having amounted to 26 million tons and 15 million tons respectively. That huge redundancy is bad news for Vietnam’s rice export next year.
However, many experts told the Daily on the sidelines of the conference that the growing area reduction was not a decisive factor to raise rice farming incomes.
“Personally, I think that incomes of farmers are not decided by rice farming area adjustments but the market’s diverse supply-demand factors,” said Le Van Banh, director of the Mekong Delta Rice Research Institute.
In the long term, Banh said, rice exporters need to comprehend the real demand of every importing country in terms of rice types and volumes, then cooperate with local farmers and scientists to prepare the farm produce accordingly, he noted.
The low profit margin for rice farmers is also attributed to many intermediary stages in the production process, which push up production cost and cut into farmers’ profits.
Phong of the Vietnam Food Association noted that high-quality rice was still selling well but for lower-grade rice, Vietnam was facing tough competition from India and Pakistan.
Even Africa now prefers top-quality rice.
Phong said that imports from Africa account for nearly one quarter of Vietnam’s rice export volume in the first months of the year, with jasmine rice and high-quality rice making up a half.
Jasmine rice exports recorded as of September 12 doubled the year-ago period’s volume, representing up to 14% of the nation’s total rice exports in the period, Phong added.
He noted that “it is very difficult to realize the rice export target of 7.5 million tons set for this year,” and his association has pulled the estimate down to 7.2 million tons.
“Obtaining the target of exporting 2.5 million tons in this year’s fourth quarter is really a tough job as domestic exporters now are facing tough competition from Thai and Indian sellers,” Phong explained.
IDG opens training institute
International Data Group (IDG) has just opened an institute for training chief security and information officers in Southeast Asia known as ACCA.
The institute is an initiative of IDG and the United Nations Development Program (UNDP) introduced in India, South Korea, China, Arab countries and Europe.
ACCA aims to increase the information technology capacity of the governmental sector and its target learners are chief information officers (CIO) and chief security officers (CSO) in Vietnam and Southeast Asian countries.
Training courses will focus on helping learners seize opportunities and overcome challenges in the era of information and knowledge-based economy and provide them with knowledge and skills needed in the development process of information technology.
The schedule of training courses will be announced soon, said IDG.
Sales up to 50 pct during Hanoi’s promotion month
About 500 businesses in Hanoi, including big supermarkets and trade centres, have registered to participate in the city’s special promotion month in November, offering discounts of up to 50 percent for many of their products.
The highlight of the month will be the two “golden days” on November 16 and 17 when products at special discounts will be available at 25 special sites around the city, announced a conference for participating businesses held by the municipal Department of Industry and Trade on September 26.
The 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 service.
The capital city plans to spend 3 billion VND (143,000 USD), including about 1.2 billion VND from the city budget, on the promotional activities.
The Industry and Trade Department will also strengthen the inspection of participating businesses to ensure the transparency and fairness during the promotion month, thus raising consumers’ confidence.
Moreover, this year, the event’s organising board coordinates with the Vietnam National Administration of Tourism to encourage travel agencies to join the month and reduce the price of tours and services.
On this occasion, Hanoi will host the 28th Asian Advertising Congress slated for November 11-14.-
Macroeconomic stability, economic restructuring spotlighted
Strengthening macroeconomic stability through monetary and fiscal policies and speeding up the economic restructuring topped the agenda of the ongoing 2013 Autumn Economic Forum in the central province of Thua Thien-Hue.
The September 26-27 forum, themed “Vietnam Economy 2013 – Prospects for 2014: Striving to Implement Three Strategic Breakthroughs”, focuses on seeking major measures, especially middle-term solutions, for the Vietnamese economy.
The State and Government should have flexible policies to deal with bad debts, such as settling debts for enterprises or making breakthroughs in some stages, said Ass. Prof. Dr. Tran Dinh Thien, Director of the Vietnam Institute of Economics.
Sharing this view, Dr. Tran Du Lich from the NA Economic Committee said Vietnam ’s economy has not yet escaped from stagnation, which resulted from its inner factors including shortcomings in economic structure and growth model, inadequate perception on the “illness” of the economy, and lack of long-term measures.
He stressed that maintaining macroeconomic stability, accelerating economic structuring and building market confidence remain the leading goal in the time ahead.
At the forum, delegates suggested a harmony between goals on economic growth and stability, and inflation prevention.
It is necessary to maintain total social investment capital at an appropriate rate to help businesses develop, they said, adding that if not, enterprises will fall into capital exhaustion, resulting in unemployment and loss of budget revenue.
They agreed that in 2013, Vietnam ’s economy has become stable with inflation being curbed at a low rate, low trade deficit and high surplus. However, it is forecast to continue growing slowly in short and medium terms due to high inventories and bad debts in the real estate market and investors’ falling confidence.
The forum is jointly organised by the National Assembly Economic Committee, the Vietnam Academy of Social Sciences, the Vietnam Chamber of Commerce and Industry ( VCCI ) and the United Nations Development Programme ( UNDP ) in Vietnam.
VietJet Air receives first Airbus aircraft
The Vietjet Aviation Joint Stock Company (VietJet Air) on September 26 received an A320 Sharklet in Paris, the first in a series of aircraft the airline has ordered from Airbus.
The hand-over ceremony saw the presence of Prime Minister Nguyen Tan Dung on the occasion of his official visit to France.
VietJet Air’s executive director Luu Duc Khanh said the airline has signed a Memorandum of Understanding with Airbus to buy 92 aircrafts and rent 8 others.
He said VietJet Air is the first airline in Vietnam and one of a few in the region to own the modern Sharklet model.
An Airbus’ representative said the establishment of VietJet Air, a private budget airline which operates both domestic and foreign flight routes, reflects the dynamic development in Vietnam ’s aviation.
The A320 Sharklet model reportedly helps save 4 percent of fuel and reduce more than 1,000 tonnes of CO2 emission every year.-
HCM City prioritises solving difficulties for businesses
Ho Chi Minh City will give top priority to removing difficulties for production, supporting the market and solving bad debts in the remaining months of this year, a municipal leader has said.
Addressing a September 26 meeting of the HCM City People’s Committee on socio-economic development in the fourth quarter, Chairman of the committee Le Hoang Quan noted that the local economy has showed signs of recovery with more than 4,700 businesses resuming their operations and nearly 1,800 new ones established.
This shows that businesses have initially overcome their difficulties so the city should create more favourable conditions for them, he said.
The chairman instructed agencies and local administrations to keep a close watch of production and business activities in order to provide timely assistance, particularly in improving credit access for businesses ahead of the peak consuming season of the year before the New Year festival.
The Department of Planning and Investment reported that in the first ninth months of this year, HCM City maintained a quarter-to-quarter GDP growth, with the Q3 figure reaching 10.3 percent, 0.7 percent higher than that of the same period last year. The city’s index of industrial production (IIP) was estimated to increase by 6 percent year-on-year.
However, the southern hub still faces high inventories and bad debts.
To deal with these problems, the municipal People’s Committee has set out measures such as providing credit support and increasing trade promotion, investment and service.-
Nhon Trach 2 power plant churns out 10 billion kWh
The Nhon Trach 2 thermal power plant in the southern province of Dong Nai had by September 26 produced 10 billion kWh of electricity after nearly two year of operation.
The plant has so far this year generated 3.6 billion kWh, fulfilling 87 percent of its yearly plan.
With the current capacity, the plant is estimated to contribute about 5 percent of electricity to the national grid annually.
According to Hoang Xuan Quoc, General Director of the PetroVietnam Nhon Trach 2 Power JSC, the company is likely to exceed its yearly plan of 4.2 billion kWh this year.
The Nhon Trach 2 thermal power plant began commercial operation in late 2011 after a fast-track construction period of only 28.5 months, 1.5 months earlier than the contracted schedule.
A s a national key project in the provincial PetroVietnam Nhon Trach Power Centre, the power plant has a total capacity of 750 MW and is fueled by natural gas which has been registered under the United Nations’ Clean Development Mechanism as main fuel.
The plant received the gold award in the Fast-Track Power Plant of the Year category at the Asian Power Awards 2012.
Rice husk-fuelled thermal power plant to be built
A number of contracts were signed on September 25 in the Mekong Delta province of Hau Giang in preparation for the construction of the Hau Giang rice husk-fired thermal power plant.
The 32 million USD project, funded by the Exim Bank of Malaysia and the Vietnam Development Bank, is expected to kick-start in late December this year, as part of activities to mark the 10 th re-establishment of the anniversary of the province.
Covering an area of 9 hectares in the provincial town of Long My , the 10-MW plant will be operational in two years.
Once completed, the plant will not only provide clean energy resources but also contribute to environmental protection in the region where rice husks are abundant in the post-harvest time, said Deputy Chairman of the provincial People’s Committee Nguyen Thanh Nhon.
The project is part of the plan to build 20 rice husk thermo-electric plants across the country, including five in An Giang, Kien Giang, Hau Giang, Dong Thap, and Can Tho city in the granary-labelled Mekong Delta, said Pham Trong Thuc, Director of the Renewable Energy Department under the Ministry of Industry and Trade.
Cashew exporters expect busy coming months
The recent rise in cashew prices has signalled a race to export cashews in the remaining months of the year.
According to Chairman of the Cashew Association of the southern province of Dong Nai (Donacas) Nguyen Thai Hoc, prices of exported cashew nuts averaged less than 6,300 USD per tonne in the first two quarters of 2013 but rose to 7,600 USD per tonne in early August.
From October to the pre-harvest period in March next year, cashew export should perform well. Prices will be higher than those in the second and third quarters but surges are unlikely to happen, Hoc predicted.
Vietnam exported 168,000 tonnes of cashew nuts worth 1.07 billion USD in the first eight months of this year, rising by 18 percent in volume and over 10 percent in value year-on-year.
Statistics from Donacas show that its member manufacturers need around 130,000 – 150,000 tonnes of raw cashew each year. However, domestic sources are capable of supplying only half of that amount, the remainder is imported.
At present, domestic supplies are not abundant and the amount of imported raw cashew is only about 70 percent that of last year, since importers are encountering difficulties in borrowing capital. As such, Donacas has urged its members to make good material preparation for the pre-harvest period.
Sales up to 50 pct during Hanoi’s promotion month
About 500 businesses in Hanoi, including big supermarkets and trade centres, have registered to participate in the city’s special promotion month in November, offering discounts of up to 50 percent for many of their products.
The highlight of the month will be the two “golden days” on November 16 and 17 when products at special discounts will be available at 25 special sites around the city, announced a conference for participating businesses held by the municipal Department of Industry and Trade on September 26.
The 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 service.
The capital city plans to spend 3 billion VND (143,000 USD), including about 1.2 billion VND from the city budget, on the promotional activities.
The Industry and Trade Department will also strengthen the inspection of participating businesses to ensure the transparency and fairness during the promotion month, thus raising consumers’ confidence.
Moreover, this year, the event’s organising board coordinates with the Vietnam National Administration of Tourism to encourage travel agencies to join the month and reduce the price of tours and services.
On this occasion, Hanoi will host the 28th Asian Advertising Congress slated for November 11-14.
Central Highlands coffee sector targets sustainable development
Developing the coffee industry in a sustainable manner is a mutual concern of the government, ministries, sectors, businesses and coffee growers in the Central Highlands provinces.
With an annual average output of over 1.5 million tonnes, developing coffee has been underscored as key to Vietnam’s agricultural growth, said Director of the Central Highlands Agriculture and Forestry Science Institute Le Ngoc Bau.
He highlighted the advantageous climate and fertile soil as well as the unique and creative farming techniques used in the area as the reasons that local producers can still sell their products despite the unstable coffee prices in the market.
The director, however, warned that an increasing number of local coffee growers persist in harvesting green beans, which may result in their products being of lower quality.
Added to this, erratic weather and security issues also responsible for the unstable coffee quality, Bau said.
He suggested Vietnamese businesses in the field come up with solutions to enhance the quality of their products mainly via improving the harvesting process.
Local authorities must also intensify security during the harvest to ease workers’ worries of their coffee beans being stolen, Bau said.
Furthermore, the State should encourage farmers and enterprises to focus on deep processing, as one kilogram of soluble coffee has far greater value than the same amount of raw processing coffee.
Scientists have also been tasked with conducting more research on technological scientific solutions to increase replanting efficiency, which will spur the sustainable growth of local coffee.
State bank regulates debt grouping
State Bank of Vietnam Governor Nguyen Van Binh this week issued a directive on classification of restructured debts to ensure that credit institutions perform safely and more effectively.
Under the directive, the Governor requires credit institutions to restructure loan repayment periods and keep loan groups on the basis of assessing the conditions for production, business and service supply, as well as the ability to repay debts; and to inspect and strictly control restructured debts to ensure that borrowers can repay the debts in accordance with restructured repayment period.
Credit institutions will not restructure the repayment period and maintain loan groups for customers that use funds for improper purposes or violate provisions of the credit agreements and related regulations.
The lenders can actively decide to restructure the repayment period on the basis of monitoring and assessing customers’ business conditions and financial strength.
Additionally, they can simultaneously reconsider interest rates in line with the financial conditions of borrowers, of credit institutions and the actual monetary market to support customers in overcoming difficulties in production and business.
They can also only restructure the repayment period and keep loan groups for clients unable to repay the principal or interest within the terms of the loan or when due, if they have new feasible business plans, and is determined that they have a better ability to repay the debts once the debt repayment period is adjusted.
At the same time, the institutions will have to promulgate internal regulations for restructuring debts to ensure unity in implementation; have internal control mechanisms to ensure control strictly and safely to prevent violations.
Besides reporting internal regulations and internal control mechanisms to the central bank, the institutions must also build and report their deployment plans and implementation commitments.
Under the directive, the Governor also requires the supervising agencies of the central bank and its branches nationwide to better monitor credit institutions to ensure they obey regulations and provide timely solutions to remove the barriers faced by lenders and borrowers.
Quang Ninh moves to lure more Japanese investors
The northern province of Quang Ninh makes every effort to build an attractive environment for Japanese investors, aiming to lure more investment from country.
As of this time, the province attracted only 9 projects from Japan with a total capital of 61.3 million USD. The result does not match the province’s potential and advantages.
Quang Ninh is now one of Vietnam’s localities that are the apex of the Vietnam-China economic cooperation project – “Two corridors-One economic belt”, which is an important part of the ASEAN China Free Trade Area.
The locality has huge strength and potential for development of marine-based economy. It has many advantages positions for developing deepwater sea port system for receiving heavy load ships and road and railway systems, which are advantages to goods exchange and tourism development.
In order to effectively exploit its strengths and advantages as well as attract more investment projects from Japan, the province attaches importance to improving investment environment, upgrading transport infrastructure while reforming administrative procedures and enhancing quality of workforce through training.
In its effort to improve investment environment, in 2011 the province established the Department of Investment Promotion and Support to foster investment promotion in the locality. The department enlists the help of provincial departments and sectors to support investment and increase coordination among relevant agencies and investors.
Recently, the province People’s Council also paid more attention to further improve technical and social infrastructure in industrial parks (IPs) with the aim of luring investment from Japan.
Along with completing the master plan for socio- economic development in the locality, Quang Ninh will also spend its budget to perfect its technical infrastructure, systems of electricity supply, waste water drainage and supporting facilities for several IPs in order to meet investors’ demands.
Besides, the province also gives priority to projects on environment protection, while accelerating site clearance and ensuring the one-stop shop mechanism to deal with administrative procedures publicly, transparently, and quickly.
Quang Ninh province issued Decision No. 677/QD-UBND on March 12, 2013 which approved a list of 32 projects to call for investment in the locality in the 2013-2015 period, focusing on fields such as transport, industry, urban infrastructure and tourism.
The province has sent its many delegations to Japan to inquire experience in building economic and industrial zones, hi-tech areas and tourism development, while maintaining ties with the Japan International Cooperation Agency (JICA), the Japan External Trade Organisation (JETRO)in order to promote its potential to Japanese partners.
The provincial People’s Committee organised a seminar to promote tourism development and cooperation between the locality and Japan in the framework of the Cherry Blossom Festival in the province in April this year.
The province is now active in completing its set of investment promotion documents in Japanese language to facilitate introduction of its potential to investors. It has also signed cooperation agreements with JETRO for activities of trade and investment promotion in 2013.
With its efforts, the province hopes to lure more investors from the country of cherry blossoms in the coming time.
Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR