BUSINESS IN BRIEF 24/10
Thai group considers re-entering Vietnam insurance market
Bangkok Insurance Public Company Limited (BKI) considers re-penetrating Vietnam after its withdrawal from the market 10 years ago as a result of the Southeast Asian nation’s improved investment environment, said BKI President Apisit Anantanatarat.
Mr Apisit also highlighted the huge potential of the lucrative and populous market that has maintained stable economic growth for numerous years.
The group has negotiated on buying stakes of several Vietnamese insurance companies, however, it needs more time to conduct a feasible study due to high costs.
In 2015, BKI expanded its investment to Laos and holds 45% of share of BKI Insurance Joint Stock Company. It is aiming for market expansion in Myanmar.
Ham Rong-Thai Binh gas system reaches yearly target early
The Ham Rong-Thai Binh gas system has supplied 106.52 million cubic metres of gas so far this year, equivalent to 100.5 percent of its yearly plan for 2016, according to the PetroVietnam Gas JSC (PV GAS).
The system is forecast to distribute over 140 million cubic metres of gas to customers in the whole year, or 132.33 percent of its target for 2016.
At present, the system is supplying customers with over 500,000 cubic metres of gas per day, reaching 90 percent of its design capacity in the first phase, while ensuring 100 percent reliability and safety.
The system is part of a series of projects which bring gas from Ham Rong and Thai Binh fields offshore the Red River basin to industrial zones in the northern province of Thai Binh and adjacent localities.
Vietnam Airlines launches promotional fares for Tet holiday
National carrier Vietnam Airlines has started a promotional ticket fare programme for domestic routes to welcome the upcoming Tet (Lunar new year) festival.
Under the programme, passengers on flights from HCM City to Buon Ma Thuot, Da Lat and Phu Quoc have to pay only VND299,000 (US$13.3) for a one-way ticket. Meanwhile, the price of a one-way ticket for those travelling on the route between HCM City and Nha Trang, Quy Nhon, Da Nang, Hue and Dong Hoi is VND399,000 each.
One-way flight tickets between HCM City and Ha Noi, Hai Phong, Thanh Hoa and Vinh cost VND699,000 each.
The promotional tickets will be sold from now until the end of October 30, 2016, for trips departing from now until February 12, 2017, or lunar January 16, 2017. The tickets will not be applicable for flights during rush hours.
Taxes and fees are not included in the ticket price.
Passengers can buy the tickets at the carrier’s website www.vietnamairlines.com and from official agents nationwide.
Reference exchange rate goes up by 13 VND
The reference VND/USD exchange rate of the State Bank of Vietnam was set at 22,032 VND per USD on October 24, up 13 VND from October 21.
With the current +/- 3 percent VND/USD trading band, the ceiling exchange rate is 22,692 VND per USD and the floor rate is 21,371 VND per USD.
The buying rate listed by Vietcombank was 22,280 VND per USD, while the selling rate was 22,350 VND, up by 5 VND from October 21.
Rates were also listed at 22,280 – 22,350 VND/USD at both at BIDV and Vietinbank.
Meanwhile, Techcombank posted buying price at 22,255 VND per USD and selling price at 22,345 VND per US dollar, down by 5 VND from October 21.
Vietnamese, Australian macadamia associations shake hands
The Vietnam Macadamia Association (VMA) and Australian Macadamia Society (AMS) recently signed an agreement to boost the industry in both countries, according to Lao Dong newspaper.
The pact focuses on future experience exchanges on macadamia cultivation, processing and trade.
The AMS will support the VMA in building criteria for farming and products to international standards.
The VMA Deputy Chairman Hoang Hoe said Australia has supported the macadamia business in Vietnam for more than 10 years.
The signing marked a new development in cooperation, helping Vietnamese macadamia firms improve their international position, he affirmed.
According to a plan approved by the Ministry of Agriculture and Rural Development, the northwest and Central Highlands regions will plant macadamia trees on 9,940 hectares of land and develop 12 processing units by 2020.
By 2030, there will be 34,500 hectare of plantations nationwide, and 30 processing units in the two regions.
Japanese firms increase investments in trade
Japanese businesses are stepping up investments in trade and services in southern Vietnam, said head of the Japan External Trade Organisation (JETRO) in Ho Chi Minh City Takimoto Kogji .
Surveys conducted by Japanese firms reveal that southerners’ purchasing power is on the rise, Kogji said, according to Sai Gon Giai Phong (Saigon Liberated) newspaper.
Apart from trade and services, the 1,600 Japanese enterprises in Vietnam also invest in food, yarn, machinery and electricity-electronics in the country, according to JETRO.
In the support industry, Kogji said Vietnam has met only 32 percent of production demands and Vietnamese firms have yet to join the supply chain of their Japanese counterparts.
However, he noted, local businesses have begun using cutting-edge machines and equipment to provide complex products with precision.
The official suggested firms make greater efforts to revamp their operations to engage in the supply chain.
2016 cement sales goal in doubt
Industry insiders are concerned the cement industry will find it hard to meet the target of selling 75-77 million tonnes of cement this year due to market difficulties.
The target is up 3.2-6 percent against last year.
To meet the target, the industry has to sell at least 20 million tonnes in the last quarter, or seven million tonnes per month.
Vietnam Cement Association Chairman Nguyen Quang Cung said it would be hard to meet the target as sales of the product in the domestic market this year rose insignificantly while exports decreased.
Representatives from a cement production company who declined to be named said sales of cement currently faced many difficulties, explaining that domestic cement supply is exceeding demand.
According to statistics from the Ministry of Construction, in the first nine months of this year, the industry sold 55.25 million tonnes of cement.
Of the total, roughly 43.55 million tonnes were sold in the domestic market, up 7.7 percent against the same period last year.
However, exports of cement and clinker in the period declined by some 2 percent year-on-year to 11.7 million tonnes. Industry insiders attributed the decline to fierce competition with products of other producers from Thailand and China.
Vietnam is currently ranked the world’s fifth largest cement exporter and the first in the Southeast Asia region, however, the country’s export volume is, in fact, much lower than Thailand’s.
Thai cement is more competitive than Vietnam as it has many traditional customers, besides advantages in transport and good quality.
Vietnam is also finding it difficult to compete against China as its cement factories, whose design capacity exceeds the demand of some 670 million tonnes – equal to roughly eight times Vietnam’s total cement design capacity.
Quy Nhon port to be expanded
The Quy Nhon Port Joint Stock Company in the central province of Binh Dinh plans to invest 1.35 trillion VND (60.75 milion USD) in expanding Quy Nhon port’ area by 6.8 ha and raising its capacity by 2020, according to the company’s Deputy Director General Huynh Tan.
In the project’s first phase from 2016-2018, land clearance and equipment procurement will be implemented at the cost of 350 billion VND (15.75 million USD). From 2019 – 2020, a new wharf will be constructed at the cost of around 450 billion VND (20.25 million USD), along with an Inland Container Depot (ICD).
The company is undertaking procedures for the construction of the ICD to meet increasing regional demand in container transport.
The upgrade and expansion is expected to raise the port’s throughput capacity to between 15 -18 million tonnes of cargo per year by 2020, and between 25-30 million tonnes after 2030.
In the first nine months this year, the port handled 5.5 million tonnes of cargo, earning over 379 billion VND (17 million USD) and contributing 32 billion VND (1.44 million USD) to the state budget.
It plans to handle 7 million tonnes of cargo this year.
One of the major ports in the central region, the Quy Nhon port complex comprises to three seaports, including two commercial ports, namely Quy Nhon Port and Quy Nhon New Port, and a military port.
These ports serve as a gateway to the East Sea for the Central Highlands, Laos, northern Cambodia and north-eastern Thailand.
As a result, the demand for cargo transport via the port complex is expected to surge in the coming years, and Quy Nhon will be a key entrepôt in the region in the foreseeable future.
Vietnamese products attract attention at Hong Kong MEGA Show
Products displayed by nearly 60 Vietnamese enterprises at the MEGA Show Hong Kong 2016 drew attention from visitors thanks to their natural and environmentally-friendly materials.
With 80 booths, Vietnamese companies brought to the October 20-23 event products made of rattan, bamboo, wood, water hyacinth, sedge, shell and oyster shells.
Nguyen Duy Kien, Vietnamese Deputy Consul General in charge of trade, said the MEGA Show Hong Kong 2016 is a good occasion for Vietnamese enterprises to introduce and promote their products to the world.
The show is Asian’s biggest annual fair on souvenirs, appliances and toys. This year’s event featured 4,600 booths from 3,500 enterprises of 27 countries and territories.
The 2016 fair is expected to attract 50,000 visitors, an increase of 10,000 against last year.
Wood export pact with EU near
Negotiations between Viet Nam and the European Union to expand the export of wood and wood products to Europe are expected to be complete by the end of the year.
The information was released by Ambassador Bruno Angelet, head of the Delegation of the European Union to Viet Nam at a meeting of the Viet Nam Administration of Forestry (VNAF) on Friday.
The purpose of the Forest Law Enforcement, Governance and Trade (FLEGT) Voluntary Partnership Agreement (VPA/FLEGT) is to expand Viet Nam’s wood and wood product export market to the EU through a mechanism called the Timber Legality Assurance System of Viet Nam (VNTLAS), which grants certifications for wood shipments to the EU.
Owners of shipments with FLEGT certifications will not have to declare the legal origin of the wood in line with the European Union Timber Regulation.
The deputy head of the Administration’s Science, Technology and International Co-operation Department, Nguyen Tuong Van, said FLEGT certifications were only granted by countries which sign Voluntary Partnership Agreements with the EU.
Currently, six nations have partnered with the EU including Indonesia, Liberia, Congo, Ghana, Cameroon, and the Central African Republic; and three others are in negotiations.
On November 15, Indonesia’s first wood and wood product shipment will be FLEGT certified. This is good news for Viet Nam, which also imports wood materials from Indonesia for furniture export to the EU, Van said.
Nguyen Van Ha, VNAF deputy director who is also head of the Vietnamese negotiating team, said talks started in November 2010 and have included 16 technical negotiation rounds and eight high-level talks. A signing ceremony to wrap up the negotiations is planned on November 18 and the agreement is set to be inked later this year.
Angelet said there was still work ahead after the agreement signing because it was not simple to change habits of forest planting, wood processing and timber product exportation.
BIDV to pay 8.5% 2015 dividend in cash
The Bank for Investment and Development of Vietnam (BIDV) is set to payout 2015’s dividend by cash at a rate of 8.5 per cent per share, while the Vietnam Commercial Bank of Industry and Trade (VietinBank) has made no indication to the Ministry of Finance (MoF) on paying a dividend.
The State Bank of Vietnam (SBV) currently holds 95.28 per cent of BIDV’s charter capital, which means MoF will receive VND2.7 trillion ($120.96 million) in dividends.
The 2015 dividend payout plan was announced at an extraordinary shareholders meeting on October 22 along with changes in its legal representative, from the Chairman of the Board of Directors (BoD) to the CEO.
Its BoD suggested amending Article 2, Clause 5 of its constitution, which previously stated “the Chairman of the BoD shall be the legal representative of BIDV” and will “represent BIDV in international relationships, litigation, dispute resolution, dissolution and bankruptcy,” a BIDV press release stated.
The extraordinary shareholders meeting passed the amendment, which states “the CEO shall be the legal representative of BIDV,” with 100 per BIDV of votes.
One agenda item at the extraordinary shareholders meeting that has received much attention but not been discussed is the nomination of a new BoD Chairman to replace former Chairman Tran Bac Ha, who resigned in September. For now, BIDV’s CEO Phan Duc Tu has been given the position.
The BoD also announced the date for finalizing the list of shareholders to receive a dividend for 2015. The final registration date is expected to be November 4, with the payout day being November 21.
BIDV’s annual general meeting held in April saw a decision passed on a 2015 dividend payout that was less than initially planned (it was to be more than 9 per cent per share) and that shareholders would receive bonds, not cash.
As at the end of the third quarter, BIDV’s total assets stood at VND956 trillion ($42.82 billion), up 11.5 per cent compared to the start of the year and the highest among Vietnam’s joint stock banks.
Total credit and investment were more than VND912 trillion ($40.85 billion), a 14.2 per cent increase against the beginning of the year. Outstanding credit reached more than VND698 trillion ($31.27 billion), up 12.7 per cent, while its bad debt ratio was 1.72 per cent.
Total mobilized capital was more than VND887 trillion ($39.73 billion). Mobilized capital from economic organizations and individual customers reached VND754 trillion ($33.78 billion), 14.2 per cent higher compared to the beginning of the year.
The mobilized capital structure has changed positively towards stable capital sources from residential customers, with an outstanding balance of more than VND427 trillion ($19.13 billion), up 20 per cent compared to the beginning of the year and representing 57 per cent of total mobilized capital.
Retail activities continued to be strengthened and contributed significantly to business performance, with outstanding retail credit growing by 19 per cent compared to the start of the year and representing 24 per cent of the total. Net revenue from services stood at VND2.68 trillion ($120 million), up 13.3 per cent year-on-year.
Pre-tax profit reached VND5.62 trillion ($251.77 million) in the first nine months, up 6.9 per cent year-on-year and equal to 71 per cent of the annual plan.
MoF released an official document in June requesting the SBV direct the representative of State capital in BIDV and VietinBank to vote for the 2015 dividend payout to be in cash.
Under the plan submitted to VietinBank’s annual general meeting in April, 2016, there is to be no dividend payout for 2015.
Its Chairman was quoted as saying that “this is a necessary decision and has strategic meaning for the bank in improving its financial capability and ensuring its capital adequacy ratio (CAR) and continued development.” The central bank currently holds 64.46 per cent of its charter capital.
Besides wanting to keep all profits from 2015 for the bank’s development, VietinBank also proposed the government consider lifting the foreign ownership limit, in which the State would hold less than 50 per cent of charter capital. VietinBank said this would ensure the ownership and control of the State in the bank while also creating the conditions to attract more resources.
VIB’s pre-provision profit up 26% in 9M
Accumulated profit before provisions of Vietnam International Bank (VIB) has been reported at VND940 billion ($42.13 million) during the first nine months of 2016, up 25.9 per year on-year, while total operating income increased 21 per cent year-on-year.
VIB’s lending balance stood at VND53.37 trillion ($2.39 billion), 11.7 per cent higher against December 31, deposits grew 12.1 per cent since December 31 to VND59.77 trillion ($2.67 billion), fees and commissions increased 41 per cent year-on-year, total assets amounted to VND88.61 trillion ($3.97 billion), up 5 per cent since the end of 2015, according to the bank’s Jan-Sep report released on October 20.
Tthe bank’s non-performing loan (NPL) ratio meanwhile, fell to 1.54 per cent compared to 1.84 per cent at the end of the second quarter and 2.07 per cent compared to the end of 2015, and its capital adequacy ratio (CAR) stood at 15.6 per cent, significantly higher than the 9 per cent required by the State Bank of Vietnam (SBV).
VIB’s credit ranking was upgraded to B2 in a Moody’s report ranking Vietnamese banks released on October 20, putting it in the group of banks with the highest credit ranking in the market.
In early October VIB gained approval from the SBV to increase its charter capital to VND5.64 trillion ($25.278 million) from VND4.84 trillion ($216.92 million) by issuing bonus shares, which is in line with the plan passed at its general shareholders meeting in April.
In terms of digital banking, two quarters after being launched VIB received 7,000 user registrations each month in the third quarter, which is ten-times higher than in the second quarter. The number of customers using MyVIB and VIB Internet Banking continues to grow impressively, confirming the rapid movement from traditional to digital transactions.
Following integrated marketing campaigns introduced in the first half, in the third quarter VIB continued to launch other preferential campaigns with fantastic offers for both personal and corporate customers. These aim to provide customers with the best benefits in loans and other products when banking with VIB.
Through these campaigns the bank also convinces customers to apply for preferential loans with competitive, transparent and stable interest rates. The bank also proactively learns about customers’ financial needs in order to assist them in better planning their life now and in the future, enabling them to gain peace of mind and focus on the more important things in life.
Established in 1996, VIB has become one of the best performing joint stock banks in Vietnam, with 154 branches and transaction offices nationwide and more than 8,000 correspondent banks in 61 countries around the world. It has nearly 4,000 employees serving 1.6 million personal customers and 34,000 corporate customers.
Mekong Delta tra fish prices shoot up
Tra fish prices in the Mekong Delta have rallied in the past two months, with an average pickup of VND4,000 per kilo.
In Can Tho, exporters are buying unprocessed fish at VND22,000-22,500 per kilo. In Dong Thap, the fish have marked up to VND22,000 a kilo from VND18,000-18,500 two months ago.
Farmers in the delta said this is the highest spike since the beginning of 2016, earning them an extra VND1,000-1,500 per kilo.
This sharp price increase is attributed to a serious decline in supply while demand is recovering.
However, Vo Thi Thu Huong, deputy secretary general of the Vietnam Pangasius Association (VN Pangasius), said tra fish output early this year markedly rose from the same period last year.
As of October 9, more than 2,700 hectares of tra fish had been harvested in the Mekong Delta, down 0.1% year-on-year, but output had shot up 12% to 856,000 tons since productivity inched up from 285 tons in the year-earlier period to 313 tons per hectare.
Figures of the Ministry of Agriculture and Rural Development, albeit different than those of VN Pangasius, show tra fish production reached 861,000 tons in the first nine months of the year, up 2.5% year-on-year.
The rebound of tra fish prices is not because of a supply fall as claimed by some sources of information, but an improvement in demand, particularly of importers and local consumers, during the year-end season.
By the middle of this September, tra fish exports had totaled US$1.15 billion, an increase of 6.6% from the same period last year, said Huong.
Meanwhile, a report by the Vietnam Association of Seafood Exporters and Producers (VASEP) says that the first eight months of the year saw tra fish shipments to the U.S. surging 22.4% year-on-year to US$254.5 million, while those bound for China grew 72%.
Despite the price rallies on the domestic market, industry watchers believe it is hard for the price of unprocessed tra fish to return to the 2010 range of VND28,000-29,000 per kilo. This is because 70-80% of the current tra fish acreage is in the hands of processing enterprises or jointly farmed by processors and farmers, whereas this percentage was 20-30% in the past.
Renewable energy underdeveloped in HCMC
Despite its large potential, renewable energy has not been paid due attention in HCMC as the total capacity of renewable energy here is only 3.96 MW, accounting for 0.1% of the city’s total power consumption, said HCMC Power Corporation (EVN HCMC).
By the end of last year, the city had got 2.4 MW of renewable energy from a project which turns waste at Go Cat landfill in Binh Tan District into energy, and 1.56 MW of solar power, EVN HCMC said in a report released on Monday.
If 31 MW from all the solar water heaters is included, the consumption of green energy in the city would reach 34.96 MW, 1% of the total electricity consumption which was put at 3,575 MW.
In February last year, the city government set a target of raising the proportion of renewable energy consumption to 96 MW, 1.74% of its total power use.
As for waste-to-energy projects in the city, a 12 MW power station that is fueled by landfill gases at Da Phuoc Integrated Waste Management Facility in Binh Chanh District has not come on stream, according to EVN HCMC.
The power corporation has asked authorities to roll out more policy incentives for waste-to-energy technology research projects.
Since solar power is seen as the most potential source of renewable energy in the city, the company said the city should give financial aid to enterprises and households using solar electricity on a pilot basis.
The city should also ask the Government to adopt an attractive pricing system for those generating solar power for the national grid.
In its master plan for electricity development until 2020 with a vision towards 2030, Vietnam looks to increase the ratio of renewable energy to 4.5% of the country’s total power consumption in 2020 and 6% in 2030.
Local firms urged to use EU markets
Vietnamese firms must draw up long-term business strategies to exploit opportunities in the European Union (EU), as the EU-Viet Nam Free Trade Agreement (EVFTA) will come into force by 2018.
The EU, an open market with an integrated legal framework for all its members, can offer more export opportunities to local firms, experts told Vietnam News Agency correspondent.
In the past few years, trade between Viet Nam and EU has been on a continuous rise. In the first half of this year, the total import-export turnover to EU touched US$21.2 billion, posting a 9.05 per cent year-on-year rise. Of this, Viet Nam’s exports to EU were worth $16.2 billion and imports were $4.97 billion, both recording an 8.68 per cent and 10.28 per cent increase, respectively, from the same period last year.
The annual growth rate of Viet Nam’s export turnover to EU could be 4 to 6 percentage points higher once the EVFTA comes into effect. The trade pact can help Viet Nam promote the export of key products such as garments and textiles, leather shoes and seafood to one of the most developed economic regions in the world.
Experts said Vietnamese companies had so far only been shipping raw materials, though EU had brought the biggest export turnover for the country. Made-in-Viet Nam products are tough to find a place in big commercial centres in EU.
Businesses said they were concerned that their technology may not meet the requirements, so they were sticking to export raw products and letting EU firms package and label the products. This, however, means that Vietnamese products could lose their trademark if they did’t register brand names and geographical location.
Dang Hoang Hai, director of the industry and trade ministry’s EU Market Department, said local businesses should know the tax cut roadmap under the EVFTA, make precise calculations for their products and draw up long-term export plans.
Bui Huy Son, director of the ministry’s Viet Nam Trade Promotion Agency (Vietrade), said the country had the ability to conquer the EU market once the EVFTA takes effect. Viet Nam had two years to improve its capacity through reforms of mechanism and policies.
Truong Dinh Tuyen, former minister of commerce, said the EVFTA would mean greater export opportunities for Vietnamese firms as the EU market was bigger than the US and Japan in terms of marketshare and value.
However, the EU is a demanding market, and Vietnamese companies can face issues relating to assessment, retention, competition and domination of the market. Tuyen said under the World Trade Organisation principles, the importing companies have the right to initiate anti-dumping duty and impose sanitary and phytosanitary (SPS) non-tariff barriers and technical barriers to trade (TBT).
In addition, Vietnamese companies can be levied anti-dumping taxes if they focus on only one market. Domestic firms should come up with suitable policies to avoid concentrating on a certain market or a specific product.
Viet Nam’s strength of offering inexpensive products may no longer be an advantage once the EVFTA commitments are applicable. Product quality and trademark will be the decisive factors in the market. It will be useful if local businesses develop items that are in low supply instead of trying to offer similar products at lower costs.
Valentin Tran, exporting director of Casino, said he was optimistic about Viet Nam’s exports to the EU and that Vietnamese goods would benefit from zero tax. Firms should understand the market properly.
Vietnamese businesses should participate in exhibitions and fairs in the EU and visit its supermarket chains to understand consumption habits. The most important thing to promote export is to pay attention to the quality of goods and meet international standards, he said.
USAID, Coca-Cola to promote use of renewable energy
The US Agency for International Development (USAID) and Coca-Cola Beverages Vietnam Limited have signed a memorandum of understanding (MoU) aimed at increasing the use of renewable energy in Viet Nam.
The MoU was inked by Michael Greene, director of USAID in Viet Nam, and Nguyen Van Quyet, director of Coca-Cola Vietnam’s supply chain, at a ceremony in Ha Noi on October 19.
Under this partnership, both organisations will work together to develop renewable energy-based power and thermal systems for industry facilities, including those of Coca-Cola Vietnam and improve industrial energy efficiency, while reducing the use of fossil fuels.
Both parties will also cooperate in developing and sharing successful models of adoption of renewable energy and practices of energy efficiency.
The partnership also seeks to improve clean energy development capacities and skills among experts and practitioners in small- and medium-sized industrial enterprises.
As one of the first activities, USAID will provide technical assistance to help Coca-Cola Vietnam install its first solar battery system on the rooftop of the plant in HCM City. It is expected to supply at least 20 per cent of the facility’s power requirements.
Speaking at the event, USAID’s visiting senior deputy assistant administrator for Asia, Gloria Steele, said, “As it enjoys rapid growth, Viet Nam’s energy consumption is soaring. This energy is mainly generated from fossil fuels and this feeds into the root causes of global climate change.
USAID wants to help encourage clean-energy policies and expand market incentives and public-private partnerships that promote the use of renewable energy technologies and increase energy efficiency in Viet Nam, she said.
Quyet said Coca-Cola Vietnam is committed to growing as a sustainable business and aims to reduce the use of fossil fuel through a variety of initiatives, such as using compressed natural gas and biomass in manufacturing plants and solar energy for water heating.
The two parties are also collaborating on the Mekong Vitality project, to strengthen the social and economic status and empower 4,900 women in the southern Vinh Long province. This will be achieved by helping them increase their household income and savings, improving financial literacy, and building their confidence and decision-making power.
Bulgarian enterprises study investment opportunities in Binh Dương
A delegation of Bulgarian enterprises led by Bojidar Loukasky, Bulgarian minister of economy, visited Binh Duong on October 19.
The delegation is studying investment and business opportunities in the province and also at the Viet Nam-Singapore Industrial Park (VSIP).
At a meeting between the delegation and the Viet Nam-Singapore Industrial Park JV Company, the company’s representative reviewed operations and scope of investment at the park.
Viet Nam-Singapore Industrial Park JV Company was established in 1996 and is a leading industrial developer in Viet Nam, with seven projects in Binh Duong, Bac Ninh, Hai Phong and Quang Ngai, as well as Hai Duong and Nghe An provinces. VSIP has attracted 630 projects with total investment capital of US$9 billion from 30 countries and territories.
Meanwhile, Bulgarian enterprises said were paying attention to those fields that have given priority to attracting investment and chances of cooperation and business in VSIP. They also studied investment incentives in Binh Duong Province.
Loukarsky said he was impressed with the modern facilities, infrastructure, investment incentives and favourable administrative procedures in Binh Duong, creating good conditions for enterprises investing in the province.
He also highly appreciated the operation model of VSIP Binh Duong and said the park was a model industrial park that should be replicated.
National Assembly to discuss supporting SMEs
The draft law on support for small and medium-sized enterprises (SMEs) will be discussed at the 14th National Assembly’s second meeting sessions which opens today, heard a conference yesterday.
Deputy Minister of Planning and Investment Dang Huy Dong said at the conference organised by the ministry’s Agency for Enterprises Development and the United States Agency for International Development that SMEs were a driver for growth and the core of the economy.
SMEs accounted for 97 per cent of all firms, provided jobs to half of the labour force and contributed 40 per cent to gross domestic product (GDP). However, they were still struggling to access business resources, such as credit, land and market information.
Dong said the law would create a level playing field for firms while raising private resources in boosting the SME community. The law would aim to encourage firms to renovate the growth model and improve competitiveness.
“The support from the law is appropriate to Viet Nam’s commitments to international trade deals,” Le Van Khuong, Head of SMEs Department said, adding that the law was expected to boost employment and contribute to enabling one million firms to operate efficiently by 2020.
According to Gloria Steele, USAID’s Senior Deputy Assistant Administrator for Asia, Viet Nam was growing rapidly in the region. Creating a favourable environment for SMEs to develop was essential for the country’s growth, she said.
In a conference held on Tuesday, experts said that gender equality should be addressed in the law on support for SMEs, by supporting female-led firms.
A report heard at the workshop on Tuesday held by the Viet Nam Chamber of Commerce and Industry (VCCI) and the Ha Noi Women’s Association of SMEs (HAWASME) revealed that female-led firms significantly contributed to the country’s socio-economic development but faced several disadvantages compared with male-led firms.
The report carried out by HAWASME and Asian Development Bank’s Mekong Business Initiative (MBI) found that female-led firms accounted for 24.8 per cent of the total number of firms or 25 per cent of the total number of SMEs and created more than 1.6 million jobs. Female-led firms also used more women workers than male-led firms with respective proportions of 43.4 per cent and 36 per cent.
However, they faced barriers in accessing financial resources, market information, trade promotion programmes and Government supports. Female entrepreneurs also struggled to balance family and work, according to the report.
Ha Thi Vinh, director of Quang Vinh Ceramics Company, said that female entrepreneurs were often bound by cultural and family factors.
Experts at the conference said that the draft law should address gender-related issues.
According to Hoang Quang Phong, VCCI’s Deputy Director, there was a shortage of support for female-led firms. “It is necessary to have policies to promote female entrepreneurship,” Phong said.
Currently, Viet Nam has only Decree 56/2009/ND-CP which mentions female-led firms, saying that support to female-led SMEs or SMEs using a significant number of women workers will be given priority. However, there were no detailed regulations and support failed to reach female-led firms.
Many countries such as South Korea, the Philippines and the US have separate laws or programmes to support female-led firms.
Bui Sy Loi, Deputy Chairman of the NA’s Committee on Social Affairs said that he expected the law on support to SMEs would support SMEs and female-led firms.
Loi said that support to female-led firms should include trade promotion, resource access, developing business network and improve capacity.
“If support to female-led SMEs is included in the law, I believe that the goal of 35 per cent of firms being led by women entrepreneurs will be within reach,” Loi said.