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BUSINESS IN BRIEF 13-3Ministry mulls allocation of fishing quotas

After surveying aquatic resources, the Ministry of Agriculture and Rural Development will allocate a specific fishing quota to each province according to the number of fishing boats in that province.

As per Decision 375/QD-TTg on the plan for fishing from 2013 to 2020 issued by the Government, fishing boats must observe the quotas granted by the Department of Capture Fisheries and Resources Protection under the agriculture ministry.

If the number of boats increases after fishing quotas have been allocated, the department will introduce measures restricting the number of fishing boats, said Tran Le Nguyen Hung, head of the Capture Fisheries Division under the department.

From 2016 onwards, some 40% of fishing boats will operate under cooperatives. Over 90% of them will go fishing in the waters where logistics ships are available.

Fishing boats can be turned into logistics ones. Fishermen and private enterprises can also build logistics ships supplying fuel, food and ice to offshore fishing boats, and buy catches from those fishing boats, said Hung.

“This model has been applied in many countries and the effectiveness of such tie-ups helps make the cost price lower than the total costs of all fishing boats combined,” he said.

The main goal of Decision 375 is to turn fishing into an efficient and sustainable industry. Therefore, fishing boats will be provided with fishing ground forecast newsletters every 30 days from now to 2015 and every 7-15 days from 2016 onwards.

The decision does not specify the fund for each period. It just mentions the fund will be sourced from the State budget, enterprises and households.

Auto sales drops strongly after Tet

The auto market declined sharply last month unlike the month before the Tet holiday which saw a strong growth, according to auto firms.

Specifically, GM Vietnam sold nearly 220 cars in the holiday-shortened month, dropping by 315 units from last year’s same period and by nearly 390 units from the previous month. Similarly, Isuzu Vietnam sold only 31 cars, down over 50% year-on-year and 50 units from January.

Meanwhile, the sales volume of Mercedes-Benz Vietnam was 91 units last month, declining by 42 units from January.

The sales decline was also seen at auto firms holding big market shares like Toyota Vietnam and Truong Hai (Thaco).

Despite taking the lead in the auto market with nearly 37%, Toyota Vietnam’s sales last month was 1,337 units, dropping by 509 units year-on-year and by over 50% from January.

According to auto firms, this is the common situation after spending-spree Tet, but such decline was too hefty.

With last month’s strong decline, the total number of cars sold by members of the Vietnam Auto Manufacturers’ Association (VAMA) reached around 3,700, falling by half compared to January.

In addition, last month’s consumption of imported cars was also low with only around 1,000 cars, equivalent to one-fourth of the same period last year and one-third of the previous month.

The sales decline is forecast to last until the middle of next month as customers are waiting for the lower car registration fees which may be applied on March 15 as proposed by the Ministry of Finance.

However, according to auto firms, the sales decline will continue until the Government announces the official time to apply the new fees.

Besides, there will be a new race in the auto market when auto firms launch new cars and new editions as well as adjust the selling prices to attract customers.

According to some sources, Honda Vietnam will launch a new edition of CR-V assembled domestically this week.

Meanwhile, VinaMazda has also announced to reduce the prices of some car products, starting from this month. Completely-built-up cars have a discount of VND20-30 million while a discount for CX-5 sport utility vehicle ranges from VND101-301 million.

The price reduction of Mazda cars in Vietnam mainly results from the depreciation of the Japanese yen, which has dropped by 20% since last November against the U.S. dollar and by 14% against Vietnam dong.

VinaMazda said that the flexible price policy closely following the yen devaluation would create the competitive advantage for Mazda cars in comparison with other cars of the same segment.

Help urged for job seekers

Local areas have been asked to create more channels to connect job-seekers and enterprises as the country aims to reach its target of creating 1.6 million jobs this year.

Minister of Labour, Invalids and Social Affairs Pham Thi Hai Chuyen said that it will be a big challenge for Vietnam to reach this goal, which is just a little higher than last year’s target of 1.52 million new jobs.

The ministry plans to decrease the number of workers in the agricultural, forestry and fishery sectors to 46 percent and raise the number in industrial and construction fields to 23.5 percent.

Meanwhile, more than 1.9 million people are expected to receive further vocational training.

Lam Duy Tin, deputy director of southern Dong Nai province’s Labour, Invalids and Social Affairs Department said the province has formed the country’s largest job placement centre to provide a source of proper information for both enterprises and those who are out of work.

So far, companies in the region have advertised positions for more than 60,000 workers this year. More than 83 percent of them are required to have graduated from vocational training school or be able to demonstrate working experience, he said.

Huynh Ngoc Long, director of the centre, said that the office will be helping workers not only in the province, but in southern and Central Highlands regions, by arranging regular meetings between job-seekers and enterprises.

Vu Trung Chinh, director of Hanoi’s Job Placement Centre said that unlike the many unofficial employment services defrauding out-of-work labourers, job placement centres are taking an effective role in assisting them.

Helmet manufacturers anticipate sales boom following new regulation

Seven helmet producers in HCM City have pledged to keep their product prices unchanged in 2013 as a move to encourage people to use good-quality helmets.

The producers showed their strong support for regulations in a newly- issued circular imposing fines on wearers of substandard helmets from April 15.

However, they said that the circular needed a longer road map of around six months to be implemented, so that they could prepare materials for the production to meet market demand. The longer time could also help them to join hands with agencies to help people to distinguish between substandard and high-quality products.

A media programme to raise people’s awareness will be carried out between March 15-April 15 and then the management agencies will start to fine substandard helmet wearers and shop owners from April 15.

This programme will be piloted at big cities before implemented nationwide.

However, Dao Vinh Thang, head of Hanoi’s Road and Railway Traffic Police Board said that sanctions for the fine had not yet been issued. Decree 34 and 71 only stipulated fines on drivers who do not wear a helmet or wore it in an incorrect way, it currently did not mention specific fines for wearing substandard crash helmets.

A high feasible project in Hoa Tam industrial zone

Petro Vietnam Oil Stockpile Company Ltd (PVOS), a joint venture between Korean firm SEK and PV Oil (a member of Vietnam Oil and Gas Group), is a provider of underground oil caverns built specifically to accommodate the needs of the oil and gas industry for commercial and production reserve, national stockpiling and international oil trading purposes.

Over two years beginning in 2010, PVOS carried out the pre-feasibility study of the port and storage project at Hoa Tam IZ.  It began looking at the geology and construction sites for the deep water seaport and storage project within Hoa Tam Industrial Zone (IZ) to assess whether the site was suitable for a large- scale underground storage cavern and would be feasible in conjunction with the planning of the industrial zone itself.  Hoa Tam has been designed to house industrial operations with great demand for petroleum storage, so this suitability was critical to the potential success of Hoa Tam.  Our preliminary study shows that the project is feasible and aligned with PVOS’s development strategy in Vietnam. PVOS has committed to be a strategic partner with Hiep Hoa Phat JSC, the developer of Hoa Tam IZ to be a secondary investor in developing the underground storage cavern and port project in Hoa Tam IZ.

On June 17, 2011, PVOS submitted the document No. 243/PVOS –E&P applied for an investment certificate for a crude oil and petroleum products storage project in the Hoa Tam Industrial Zone to the Phu Yen Economic Zone Management Board. This project consists of an underground storage cavern system with 3.1 million cubic meters of storage capacity, an export terminal for vessels up to 80,000 DWT and a single point mooring system to accommodate vessels up to 300,000 DWT for the purpose of development and operation of industrial terminals and tank farms ensuring the importing and exporting of crude oil and petroleum products.

During the implementation of  the 1/2000 master plan of the  Hoa Tam industrial zone and Bai Goc deep seaport project, the contributions of PVOS and its Korean strategic partners have been invaluable in enhancing the project plan to bring it to world-class standards.

PVOS has worked with Vung Ro Petroleum Company Limited (VRP), the principle investor in the Vung Ro Refinery project, in the past. Vung Ro is considering relocating the Refinery to Hoa Tam Industrial Zone and has recently garnered the approval of the Prime Minister. On July 26, 2011, VRP signed a Memorandum of Understanding (MOU) with PVOS for the purpose of studying investment and construction of the crude oil and petroleum products storage project at the Hoa Tam IZ, of which VRP has expressed its desire to become a strategic partner.  They are looking for a 34% equity stake.

Thus, we have committed to strategically cooperate with Hiep Hoa Phat to develop the underground oil storage cavern, single point moorings and liquid jetties as key components of the Hoa Tam industrial zone and Bai Goc deep seaport. VRP has received approval for the project’s relocation to Hoa Tam by the Prime Minister and, in addition, has become a secondary investor in Hoa Tam.  These are good signals for the initial development of Hoa Tam as well as PVOS’s crude oil and petroleum products storage project.  VRP is dedicated to ensuring its refinery development to be in legal compliance and contribute to the success of sustainable industrial development in Phu Yen province.

Subject to further negotiations between the sponsors of Hoa Tam – Hiep Hoa Phat Joint Stock Company – and the owners of Vung Ro Petroleum, the refinery plant could be a very significant development for the Hoa Tam project.

AWR Lloyd is the lead strategic and financial advisor to raise capital and seek developers, investors and customers for the Hoa Tam Industrial Zone and Bai Goc deep water seaport being developed by Hiep Hoa Phat Joint Stock Company (“HHP”). Incorporated in Hong Kong with offices around the world, AWR Lloyd is an independent and specialized corporate finance firm with an exclusive focus on the energy, mining, metals and infrastructure industries in the Asia-Pacific region. AWR Lloyd has conducted strategic advisory assignments for many blue-chip resources groups including Banpu, Sojitz, Petronas, Toyota Tsusho, Chevron and Sumitomo Corporation. AWR Lloyd has also worked for many new ventures and smaller companies in Asia, with a particular focus on energy terminals in South East Asia.

AWR Lloyd has performed extensive research about the Hoa Tam industrial zone and Bai Goc deep seaport project. AWR Lloyd believes Hoa Tam presents a unique opportunity to develop a world-class fully integrated multi-industrial cluster and petroleum trading hub in the heart of Vietnam. The proximity to infrastructure, supporting industry, the right geography and government support are not always aligned. The mix of the ‘right ingredients’ for large scale infrastructure and energy investment is rare in Vietnam.

Hoa Tam is planned as a fully integrated, multi-industrial zone with special focus on energy production.  It will be served by an on-site deep water seaport with a natural water depth of 17 meters and can accommodate carriers and tankers up to 300,000 DWT, creating the potential for high throughput in importing and exporting of finished goods and raw materials to serve the production in Hoa Tam industrial zone.

In the first phase of development, HHP will focus on building out the energy and petroleum complex, which may consist of a power generation and petrochemical plants, refinery, and oil and petrochemicals storage (both underground and tank farm). At the port facility, an SPM and liquid bulk and dry bulk terminals will be developed accordingly to support the growth of the energy and petroleum complex.

Hoa Tam has many advantages to attract investors in heavy industries such as oil refining and petrochemical production. The site has excellent access to both existing and future transportation infrastructure including, railways, the national highway, national roads other seaports and is 15km from a major airport.  Hoa Tam will be an integrated industrial zone with deep seaport facilities that will become the natural logistics hub for the Vietnamese petroleum industry.  More than 2,300 hectares of land have been set aside which is ready for development, the site is essentially flat requiring minimal site preparation prior to major construction.  The area near Hoa Tam in Phu Yen is supported by abundant labor, fresh water and construction material such as granite rock.

AWR Lloyd’s view is that there is strong upside potential in developing petroleum related business at Hoa Tam. Vietnam currently relies on imported refined products for 70% of its consumption. Consumption is expected to increase from 16.12 Mt in 2012 to at least 36 Mt by 2025 with a CAGR of 6-7%. Vietnam’s strong macro-economic outlook will necessitate a more mature petrochemicals industry, boosting demand through knock-on effects, creating one of the great growth stories that exist in the world today.

Hoa Tam is an enormous development project that needs coordination and cooperation between different players. Despite its competitive advantages, in order for Hoa Tam to attract big players, it is incumbent for developers and local government to coordinate well with each other. Investment policies and the disposition of local government need to be friendly, reliable and professional.

Vung Ro Petroleum, a special purpose vehicle, set up by Technostar Management, is licensed to develop a 4Mtpa refinery plant in Vung Ro Bay. It has had its request to double their capacity to 8Mtpa and to move their project to Hoa Tam industrial zone approved by the Prime Minister. Subject to further negotiations between the sponsors of Hoa Tam – Hiep Hoa Phat Joint Stock Company – and the owners of Vung Ro Petroleum, this could be a very significant development for the Hoa Tam project.

Danang tourist numbers double

The number of tourists in Danang City has doubled from 1.26 million people in 2008 to 2.65 million people in 2012.

The information was unveiled by Ngo Quang Vinh, director of Danang’s Department of Culture, Sports and Tourism on Wednesday.

The city has 138 tourist agencies and nearly 400 hotels with 11,000 rooms (triple the figures from 2008). Social income from the tourism sector in 2012 reached VND6,000 billion, a three-fold rise from four years ago.

The local authority is also planning to develop sea tourism and MICE.

“During the past few years, many cultural and sporting activities like the international fireworks display contest, tourism festival Diem hen mua he (Summer’s rendezvous), International Paramotor Competition, the street music festival and professional tourism promotion programs have helped develop the local tourism sector,” said Vinh.

In 2012, Danang lured over 2.65 million travelers, a 12% increase year-on-year. This was the lowest increase compared to 2010 (36%) and 2011 (34%).

However, the tourism revenue last year increased 54% compared to 2011. Additionally, Danang’s International Airport plays an
important role in the development of Danang’s tourism with the total number of passengers coming to the city reaching 157,492, a 236% increase year-on-year.

Price adjustments feared to fuel inflation: survey

Credit institutions described adjustments in prices of the items subject to State management as the greatest risk to inflation control in 2013, the Monetary Statistics and Forecast Department of the central bank said.

As per a report on the latest survey of credit institutions done by the department, price adjustments are believed to have the biggest impact on inflation this year. The other factors are changes in monetary and fiscal policies.

Efforts to curb inflation in 2013 heavily depend on price stabilization of the items on the State control list, said the surveyed credit institutions.

Inflation control is believed to be a tough challenge, especially when the Government’s Resolution 01 aims for CPI rise of 6-6.5%, lower than the 6.81% in 2012, and GDP growth of 5.5%, versus 5.03% last year.

Nearly 90% of the respondents believed inflation would be kept at a single-digit level this year. About 70% of them expected a rate of 5-10%.

Therefore, they hoped both deposit and lending rates would go down further. Nearly 70% expected deposit and lending rates for Vietnamese dong to fall at most two percentage points.

Credit institutions thought the inter-bank exchange rate would stay stable or just inch up. Most banks forecast the rate would go up 1-3%.

Only 17% of the respondents said the business environment would be favorable to their operations in the first half of 2013. However, they hoped the situation would improve in comparison with 2012.

Some 60% of credit institutions complained they were adversely affected by the business environment in the second half of 2012, while only 20% said so in the first half of the year.

The majority of the respondents hoped their pre-tax profits this year would be higher than in 2012, with most expecting a 20% growth in profit, says a report on the Government web portal chinhphu.vn.

Credit institutions are affected the most by business and financial conditions of their clients. Around 85% predicted risk from clients would not lessen in the first half of 2013.

Most banks hoped credit growth would be better than in 2012. The majority of them eyed growth of 10-20%.

Deposit growth was expected to be consistent with credit growth. The survey respondents forecast deposits in Vietnamese dong would be higher than those in foreign currencies.

In addition, credit institutions said they would prioritize funds for the key sectors such as agriculture, export, supporting industries and small and medium-sized enterprises. They would limit credits for real estate and stocks.

Credit institutions remained cautious about the economic situation and their performance in 2013, but they still hoped for improvement.

The survey respondents hoped the central bank would slash interest rates to reasonable levels, strictly handle the credit institutions breaching the interest rate caps and create a healthy environment for monetary operations.

Since the fourth quarter of 2011, the central bank has inspected credit institutions every six months to detect changes in the business cycle earlier than the official statistics, serving the making of the monetary policy and the management of the central bank.

Findings from the survey on factors triggering high inflation are largely similar to remarks by the National Financial Supervisory Commission in a report released in Hanoi on Monday.

As covered by the Daily on Tuesday, price management policies are the key factor for curbing inflation this year while impacts of other macro elements would not be significant.

The commission therefore called for relevant authorities to attend to measures to ensure stable prices of essential commodities, especially those on the State control list like power, fuels, and public services.

HCM City to have environment protection fund

The HCMC Environment Protection Fund (HEPF) will be established with charter capital of VND150 billion to provide financial assistance for projects preserving the nature and repairing the environmental pollution in the city.

HEPF is set up on the basis of combining the HCMC Waste Recycling Fund and the Fund for Industrial Pollution Reduction.

According to the HCMC Department of Natural Resources and Environment, HCMC has 1,025 enterprises operating in the sector of environmental service. Regarding waste recycling alone, there are around 150 enterprises and facilities. Besides, most enterprises want to expand their operations but face financial difficulties.

In the country, there are currently the Vietnam Environment Protection Fund having charter capital of VND500 billion and 20 funds of provinces and cities nationwide such as the ones in Hanoi, Binh Duong and Ba Ria-Vung Tau. These funds have financially assisted programs and projects related to activities preserving the nature and biodiversity, and preventing and repairing the environmental pollution.

The project for establishing the HCMC Environment Protection Fund will be submitted to the HCMC Department of Home Affairs soon for evaluation and submitted to the HCMC government for approval in June.

TV commercials fuel advertising growth

Vietnam’s advertising growth of 30% last year mainly resulted from television commercials as advertising in print media and on the radio are declining, said the research firm Kantar Media Vietnam.

Among over VND20.4 trillion enterprises spent on advertisements in the mass media last year, advertisements on television accounted for VND18.25 trillion, up 36% from the previous year.

Meanwhile, advertisements in print totaled VND2.15 trillion, dropping around 8%, and those on the radio declined by nearly 20% to only some VND25 billion.

Tran Thi Thanh Mai, general director of Kantar Media Vietnam, said that the television advertising would still hold the lion’s share this year as television would remain the most popular medium.

The development of digital television, especially cable television, has made television more popular while provincial television stations have now drawn more viewers, promising huge revenues for television advertising.

However, according to Mai, the stronger participation has also made the market more fragmented as a household in Vietnam is offered with an average of 40 television channels. Besides, it will result in a tougher competition among television stations.

This is also the reason why several television stations failed to hit their profit targets last year although the TV advertising revenue increased by 36% and currently accounts for up to 85% of the advertising market.

The Internet and mobile phone advertising is forecast to affect the marketing share of the television advertising.

Nevertheless, Mai said that television would not be hampered much as studies showed that the Internet and mobile phones only served as supplemental media for television. Enterprises are spending only 3-5% of their advertising budgets in such media, she added.

Moreover, technological development has now enabled viewers to watch television on several media including mobile phones and tablet computers. “This will make television stronger,” Mai said.

The fast-moving consumer goods sector will still take the lead in the television advertising with two multinational giants, Unilever and Procter & Gamble, spending the biggest budgets on TV commercials.

PVFCCo supports Mekong Delta farmers

PetroVietnam Fertilizer and Chemicals Corporation (PVFCCo) plans to expand the program of transferring fertilizing techniques to farmers in the Mekong Delta using Phu My fertilizer.

With this model, farmers will be able to approach the firm’s fertilizing method that can help reduce fertilizer losses and increase profits on the same area of land.

Speaking at a meeting to review the program in An Giang Province on Wednesday, Nguyen Phuoc Thanh from the An Giang Plant Protection Office said that the program aimed to help farmers spread fertilizer properly and avoid providing too much fertilizer that can cause diseases to develop.

Participating in the model, farmers can save VND2-3 million per hectare in production costs as it will help reduce the fertilizer volume.

Specifically, according to Thanh, farmers normally use 120-130 kilograms of nitrogenous fertilizer for every hectare of rice. However, with PVFCCo’s technical guidance, farmers will need only 90-100 kilogram per hectare while rice still grows well.

VND33 trillion of Government bonds issued

Exactly VND5,900 billion ($283.2 million) was received from a VND6,000 billion ($288 million) Government bond issue on March 7, increasing the total Government bonds issued this year to VND33,158 billion ($1.59 billion).

Cash received from the two-year bonds issued by the State Treasury reached VND3,000 billion ($144 million) and yielded an interest rate of 8.3pct and three-year bonds hit VND2,900 billion ($139.2 million) and yielded an annual interest rate of 8.53pct.

Vietnam Airlines to resume Da Nang–Tokyo service

Direct flights between the central city of Da Nang and Tokyo are expected to be offered by the end of this year, according to a Vietnamese foreign affairs officer in Tokyo.

“National carrier Vietnam Airlines will resume services between Da Nang International Airport and Narita International Airport route by this year-end,” Mai Dang Hieu, deputy head of the Tokyo-based Da Nang Representative Office under the city’s Department of Foreign Affairs, confirmed with Tuoi Tre on Wednesday.

After several pilot flights, the official service will include three commercial flights per week, connecting Vietnam’s central hub and the Japanese capital city, Hieu said.

Meanwhile, VNA also plans to open the Da Nang – Siem Reap route on July 1, and Da Nang – Incheon a month later.

“Japanese tourists can thus follow the Narita – Da Nang – Siem Reap – Ho Chi Minh City – Narita route for their trips,” he said.

The Da Nang – Narita service was offered in 2010, but was halted a year later.

Vietnam has recently emerged as a favorite destination for Japanese tourists.

The number of Japanese holidaymakers to the country has increased steadily in recent years, and Japan ranks near the top in terms of countries that send tourists to Vietnam, with 576,386 arrivals last year, a 20 percent increase compared to 2011.

Ernst &Young: Economy moves towards growth

Auditing firm Ernst & Young predicts in its forecast about rapid-growth markets that economic activity in Vietnam remains subdued but is set to pick up this year and in 2014.

This year, the country’s Gross Domestic Product (GDP) is expected to be 5.5 percent and the consumption price index (CPI) 7.8 percent.

In 2015, the country’s GDP is estimated to climb to 7.1 percent and the CPI to fall to a growth of 4.8 percent.

“The near 7 percent growth trend can be regained by 2014, as export markets recover, if banks become more stable and if rule changes are enacted for planned foreign direct investment,” Ernst &Young said in its report.

“Import substitution will continue to contain the trade deficit. Despite consumption picking up as inflation subsides. But competition from other low-cost locations is a downside growth risk,” it added.

In its forecast, Ernst& Young said that China continued to move up the value chain, creating many development chances for other Asian countries, including Vietnam.

Vietnam is one of 25 rapid growth markets cited in the report that have shown improvement thanks to an increase in trade and demand for commodities.

Ernst & Young said that these markets had started to regain momentum.

Dong Nai to build museum of science, technology

A Museum of Science and Technology will be built in southern Dong Nai province, the Ministry of Science and Technology has announced.

The museum will collect and preserve objects and data relating to scientific and technical history and development of Vietnam and the world along with carrying out research and public programmes such as science competitions.

It will have seven sections: scientific history, basic science and environment, natural science, future science, science and life, Vietnam science, and Dong Nai science.-VNA

Phnom Penh to host Vietnam trade fair

A Vietnam-Cambodia Trade and Services Fair will be held at the Mondial Centre in Cambodia ’s capital Phnom Penh from April 3 to 7.

The annual event, called the HCM City Expo, seeks to enhance trade and services while fostering solidarity and friendship between the two countries.

It will feature 250 booths displaying high-quality Vietnamese products, including agricultural products, processed foods, interior decoration items, garments, footwear, cosmetics, electronic devices, and plastic products.

A number of trade and tourism promotions, cultural exchanges, and seminars will also take place on the fringes of the expo.

Vietnam – important market for Canon

Vietnam is a very important market for Canon, Kensaku Konishi, President and CEO of Canon for South and Southeast Asia, told Singapore-based Vietnam News Agency reporter.

At a media meet held during the launch of Canon Business Services in Singapore this week, Konishi, who is responsible for leading and overseeing the operations in Singapore and 18 other Asian countries, including Vietnam, said that Canon has over the past more than 10 years developed its operations in Vietnam with the latest being the establishment of Canon Marketing Vietnam in July 2012.

The new company was established with the aim of creating an import, distribution, sales and service system for Canon products in Vietnam, he added.

According to Konishi, Canon Vietnam is one of the five subsidiaries in the region recording highest growth. In 2012, Canon Vietnam’s operations were up 30 percent from the previous year, following only Canon India.

He attributed the high growth to good distribution network in Vietnam, including Le Bao Minh distributor and more than 300 agents.

The official confirmed that Vietnam remains a potential market that Canon is strategically prioritising in the coming five to ten years.

He added that Canon Business Services, which has been newly developed to address current needs of organisations by enabling organisations to outsource information intensive processes, communications and administrative functions, will be introduced first to Singapore businesses, then those in India, Hongkong and Malaysia within this year.

“The same services will be launched in Vietnam next year,” Konishi said.

Canon currently operates four manufacturing factories in Vietnam.

Wetlands alliance programme benefits Kien Giang

The Wetlands Alliance Programme has helped not only protect marine resources but also raise local people’s awareness of the issue, and created more on-the-spot jobs after five years of implementation in the southern province of Kien Giang.

The programme has been underway in Ham Ninh and Bai Thom communes on Phu Quoc Island – home to 11,000 hectares of sea grass – since 2008. It has created four spawning grounds for valuable aquatic species.

Under the programme, a spawning green crab bank was set up in Bai Bon village, Ham Ninh commune in 2011. Every time local fishermen catch crabs carrying eggs, they will deposit them into the bank. They will receive back the crabs to sell after the crabs lay egg. The bank also provides loans worth 3 million VND to participants, allowing them to pay an interest rate of five spawning green crabs each month.

A fishing management model was also established in the two communes with voluntary groups to protect aquatic resources, natural marine hatchery grounds and the local sea grass system.

In the coming time, the programme will open two or three more crab banks.

Dong Nai, Japan boost cooperation in supporting industries

Representatives from the Dong Nai provincial People’s Committee and the Kansai Bureau of Economy, Trade and Industry (KBETI) of Japan gathered on March 6 to discuss ways to further bilateral cooperation in supporting industries.

The two sides agreed to create favorable conditions for support businesses from the Kansai region to invest in the southern Dong Nai province.

Dong Nai will establish a consultation board to provide all-around support for Kansai businesses that want to operate in the locality.

The two sides also discussed environment and human resource cooperation, reaching agreement on the exchange of information and technology to address environmental challenges.

They will build a system to train human resources for industrial sector and increase links between Japanese businesses and training centers in Dong Nai.

KBETI Head Toshihiro Kobayashi said more than half of Kansai business projects investing abroad target Asian countries.

Cooperation with Dong Nai province has created a new investment direction for Kansai businesses, he said.

Chairman of Dong Nai People’s Committee Dinh Quoc Thai said the locality has attracted investors from 35 countries and territories with total registered capital exceeding US$23 billion.

Japan has the third most projects in Dong Nai with over 130 businesses involved and a total investment of nearly US$3 billion.

The locality will prioritize the support industries and economic development in combination with environmental protection, Thai noted.

Dong Nai also hopes Japanese businesses will bring with them the best environmental treatment solutions, he said.

Within the framework of the seminar, 50 Japanese businesses operating in Dong Nai shared their experiences with eight Japanese businesses that want to set up in the province. They discussed the locality’s investment policy, incentives, political procedures and its labor market.

Vietnam earned US$119 million from fruit and vegetable exports in the first two months of 2013, up 16 percent on last year’s same period.

The result continues the sector’s 10 year streak of consecutive export growth.

This year’s fruit and vegetable export turnover is expected to hit US$1 billion, making it possible to join the US$1 billion club if the steady growth is maintained in the remaining months.

The country’s 13 primary markets with import turnover of exceeding US$10 million included China (US$218.1 million), Japan (US$54.6 million), the US (US$ 39.9 million), Russia (US$28.4 million), the Republic of Korea (US$22.6 million), and Thailand (US$20.4 million).

Large volumes of specialty fruits are being shipped abroad, such as longan, mango, orange, grapefruit, lychee, banana, and dragon fruit.

Vietnam still spends significant amounts on fruit and vegetable imports. They totalled US$294 million in 2010, US$293.5 million in 2011, US$335 million in 2012, and US$51 million in the first two months of 2013— up11.2 percent on the previous year.

Sustainable export growth will require Vietnam to focus on improving quality, controlling illegal imports, and ensuring food hygiene and safety.

Finance watchdog urges price control

While inflation control measures should focus on price management – especially in the first months of the year – prices of essential commodities should be adjusted with
caution, the National Financial Advisory Commitee said.

The committee advocated forming a “price stabilisation package” that would include roadmaps for adjusting the prices of petrol, electricity and public services. Such a
scheme would prevent price adjustments from occurring in the same month, which might push up the consumer price index (CPI).

According to the committee’s calculations, if Vietnamese dong devalued 3 per cent against the US dollar, CPI would increase by 0.3-0.4 per cent. If electricity prices
increased by 10 per cent, CPI would climb 0.4 per cent. And if the petrol price rose 5 per cent, CPI would climb 0.1-0.15 per cent.

If all three prices were adjusted at the same time, however, CPI might rise by 0.8-1 per cent.

The Government’s target of keeping this year’s CPI below the 2012 rate was feasible, according to the commission, if both the money supply and aggregate demand
remained under control.

Additionally, the committee recommended that any policies intended to resolve bad debts and rescue the real estate market should take into account the amount of money
pumped into circulation and the pressure of inflation in order to limit impacts on the year’s inflation goal and create a stable macro-economic environment in the medium and
long term.

Regarding exchange rate-related policies, the committee said that adjusting the exchange rate was not urgent, as exports had seen positive growth and curbing inflation
remained a challenge. Therefore, the commission recommended that exchange rate policies prioritise curbing inflation and stabilising the macro-economy.

Can SBV intervention help gold trade?

(VNS) In March the gold bullion market has seen some important policy changes that allow the central bank to strongly intervene to stabilise it and enlarge the country’s
reserves.

On March 4 the Government allowed the State Bank of Viet Nam to trade gold bars.

This is expected to help protect gold investors and consumers and narrowing the gap between domestic and global prices, helping stabilise the market in the long run.

One mode of intervention is by pumping large volumes of its gold bars through auctions into the domestic market to redress the imbalance between supply and demand.

Through the auction, the central bank can adjust the prices of bullion, bringing domestic gold prices down closer to global prices.

The SBV decided to conduct a trial auction with the participation of banks and gold trading businesses to ensure that the mechanism can be run smoothly.

On March 5 it placed at which 52,000 gold bars under the hammer with a reserve price of VND43.65 million per tael.

The SBV is set to begin auctioning bullion in “7-10 days’ time.”

But the jury is still out on the effectiveness of the central bank’s intervention.

This is because soon after the announcement about the auctions came, the gap between global and domestic prices dropped to the record low of VND2.8 million ($119) per
tael (1.2 ounces) on February 28, down from VND5.4 million a week earlier. But the difference quickly surged back to VND4.25 million by March 6.

The SBV governor is on record as saying the appropriate gap should be VND400,000.

With the current imbalance in supply and demand, the central bank is unsure if it has enough gold to intervene in the market for a long time.

It is expected that people will continue to buy gold as long as the Vietnamese and global economies remain mired in difficulty.

Thus, if the central bank continues to pump more bullion to stabilise the market, it could enable a return to “goldisation.”

To ensure a stable market and narrow the price gap, the central bank, besides selling gold, should also carry out measures like setting up a national gold trading floor,
weaning people away from the habit of trading physical gold, and allowing gold trading on account.

Measures to combat inflation, stabilise the economy to increase trust in the dong, and change people’s habit of keeping their savings in physical gold should also continue
to be implemented seriously.

Instalment plans

Tran Thanh Hai works as an engineer at the Sai Gon Beer Company, earning around VND7 million a month.

Thanks to his thrifty lifestyle he saves around VND3 million a month.

Six years into his job, he has saved a certain amount of money, but he does not dare dream of buying a house with the modest amount.

As a result, he has continues to lease a house whose rent rises constantly.

Hai hopes to own a house one day if developers of low-cost housing allow people like him to pay for their apartments in instalments.

While property developers are sitting on thousands of unsold apartments, many people, particularly in major cities like Ha Noi and HCM City, do not own a house.

But selling apartments under instalment plans has yet to become popular since developers are reluctant considering the risks and the time it takes them to recoup their
investment.

Besides, most of them lack the deep pockets this requires and themselves depend overwhelmingly on bank loans.

Even bank mortgages do not work since even for an apartment worth a billion dong or less, a buyer will have to pay a few million dong or more every month, a huge amount
in a country where the average wage is only a few million a month.

To encourage developers to sell on high-purchase, the Government needs to provide them tax breaks.

VN’s foreign investments begin to pay off

According to the Foreign Investment Agency, Vietnamese firms have invested US$12.4 billion abroad and are beginning to enjoy the payoff.

They repatriated profits of $430 million last year.

The most successful firms are in the petroleum, telecom, and rubber industries.

Viet Nam National Petroleum Group (PVN) was a pioneer in investing abroad, investing in 14 countries and getting access to oil reserves of 170 million tonnes there.

Revenues

Last year its overseas revenues were $587 million, taking the total so far to $1.23 billion.

FPT Corporation has achieved quick success after investing abroad in recent years.

The company obtained $90 million, up by 30 per cent as compared with the figure in 2011. Of the turnover, most of them were generated from supplying software products.

The company now plans to expand investment to other markets like India, Europe, Japan, the US, and Myanmar.

Last year Vietnamese companies invested $4 billion in 224 projects in Laos.

Most are in growing and processing rubber and sugarcane, and the investors include Hoang Anh Gia Lai Group (HAGL), Corps 15, Bidiphar Rubber Joint Stock Company,
Viet Nam Rubber Group, and Dak Lak Rubber Joint Stock Company.

HAGL was one of the first Vietnamese companies to invest in rubber production in Laos.

Its investment in Laos has topped $900 million in 25,000 hectares of rubber plantations and 6,000ha of sugarcane fields. The company hopes to expand to 100,000ha in future.

The Ministry of Planning and Investment said that by the end of last year Viet Nam had 104 projects in Cambodia with a registered capital of $2.42 billion, 4.4 times the 2009 figure.

Most of them are in telecom, agriculture, financial services, and consumer products.

The Viet Nam Military Telecommunications Group (Viettel) has led Vietnamese investment in telecom in many countries, including Cambodia, Laos, Haiti, Peru, Mozambique, and Cameroon.

In 2011 the company transferred $40 million in profits to Viet Nam, and this is expected to increase to $76 million this year.

After 20 years of investing abroad, Vietnamese firms are reaping the results, benefits themselves as well as the country.

But a question for the Government is how to manage these investments in such a way as to ensure they do not affect job creation at home and the country’s foreign currency reserves.

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

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