BUSINESS IN BRIEF 29/11
Dong Nai’s trade surplus exceeds $2 billion
The southern province of Dong Nai ran a trade surplus of over 2 billion USD in the January-November period, according to the local Department of Planning and Investment.
The province’s exports over the past 11 months reached about 13.9 billion USD, up more than 8 percent year-on-year, while imports were nearly 11.9 billion USD, up 2 percent, resulting in the highest-ever trade surplus in the locality, Sai Gon Giai Phong (Liberated Saigon) newspaper reported.
Sectors that saw big export turnover include footwear, garments-textiles, timber products and seafood.
With the figures, Dong Nai has become one of the four cities and provinces nationwide generating the highest trade surplus.
The department said since the beginning of this year, Dong Nai has attracted 1.83 billion USD in foreign direct investment (FDI), achieving 183 percent of the set yearly target.
The capital mainly comes from the Republic of Korea, Japan, Thailand and Taiwan (China).
Trade exceeds 316 billion USD in eleven months
Vietnam estimates total trade turnover at 316.16 billion USD between January and November, a year-on-year increase of 5.5 percent.
The figure includes some 159.5 billion USD in exports and 156.66 billion USD in imports, according to the General Department of Vietnam Customs.
As a result, the country is set to record a trade surplus of nearly 2.85 billion USD in the 11 months.
It expects overseas shipments of 15.6 billion USD and imports of 16 billion USD in November alone, representing respective monthly rises of 1.3 percent and 1 percent.
Total trade this month is expected to increase by 1.1 percent from October to around 31.6 billion USD, according to Vietnam Customs.-VNA
Competitive power market key to promoting renewables
Vietnam is prioritising developing a competitive electricity market, which is vital to promoting renewable energies, said Head of the Central Institute for Economic Management (CIEM) Nguyen Dinh Cung.
He made the statement at a CIEM seminar in Hanoi on November 28, where participants discussed the growth of renewable energies in concert with a competitive power market.
According to Pham Duc Chung, a CIEM member, renewable energy producers in Vietnam enjoy incentives in tax, land leasing prices and loans.
However, the dependency of electricity firms on State support has led to a power market without competition, making it hard to attract investment in renewables.
To address these shortcomings, Chung stressed continuing a complete overhaul of the Electricity of Vietnam (EVN) as planned with a focus on restructuring its executive board to boost independence among EVN members.
Improving the capacity of the Electricity Regulatory Authority and Competition Authority is also necessary, he said.
Nguyen Van Vy, Head of the Vietnam Energy Association, proposed preferential investment credits for renewable projects.
He also suggested issuing an environmental tax on the use of fossil fuels, adding that the fees should be channeled into developing sustainable energies.
Central Highlands: high coffee prices offset declining output
A significant increase in coffee prices in the Central Highlands has helped offset a decline in output, according to the Steering Committee for the Central Highlands Region.
The committee said a long drought significantly reduced the 2016-2017 coffee harvest.
For the whole region, the output of 135,000 hectares of coffee hit by drought fellby up to 50 percent, while another 7,894 hectares died of drought.
DakLak, a major coffee producer of the country, has nearly 69,000 hectares of coffee hit by drought, of which 5,570 hectares suffer from complete loss.
However, coffee bean priceshave been at a five-year peak, increasing from 41,000VND to 42,000VND per kilogramme, bringing goodprofits to farmer households.
According to the steering committee, the Central Highlands region has a total coffee area of 573,400 hectares, of which 532,499 hectares have been in harvest, with an estimated output of over 1 million tonnes of coffee beans.
DakLakboasts the largest coffee area yielding the biggest output, with more than 453,000 tonnes of coffee beans.
Nearly 10,000 new firms established in November
As many as 9,918 enterprises with total registered capital of 87.1 trillion VND (3.83 billion USD) were established nationwide in November, according to the Department of Business Development under the Ministry of Industry and Trade on November 28.
The figures represent a fall of 3.8 percent in volume and an increase of 6.8 percent in value compared with the previous month.
They push the number of newly-established enterprises in the first 11 months of this year to 101,683, and total registered capital to 797.7 trillion VND (35.1 billion USD), a year-on-year increase of 17.1 percent and 48.1 percent, respectively.
The average registered capital of a new firm reached 7.8 billion VND (343,200 USD), up 26.5 percent.
The increasing trend reflects the effective measures the Government has devised to help enterprises’ development.
Bankrupt firms continue to rise
Up to 10,400 Vietnamese enterprises have gone bankrupt between January and November this year, up 23.3% on-year, according to the General Statistics Office.
Up to 10,400 Vietnamese enterprises have gone bankrupt between January and November this year
The office’s report showed during the January-November period, over 10,400 Vietnamese companies had announced their bankruptcy, up 23.6% on-year, with 93% having a registered capital of below VND10 billion (USD476,190) each.
Meanwhile, the number of companies which had to halt their operations during this period reached 54,000, including up to 65% of firms waiting to be dissolved or facing the risk of closure permanently.
According to the GSO, as many as 101,680 businesses were established in the 11 month period. The number of firms which resumed operations grew by 31.7% on year.
Economist Pham Chi Lan said that private sector businesses were facing many difficulties such as limited management capacity, limited scale and low access to credit in the context of fiercer competition.
How green produce from China enters Vietnam
A huge volume of Chinese agro-produce is being transported across the border on a daily basis to Vietnam, where they will be disguised as locally grown or Thai products before being sold to consumers.
Tuoi Tre (Youth) newspaper reporters have gone undercover, following dealers and truck drivers on routes thousands of kilometers long from an ‘open produce market’ in China to the wholesale markets in Vietnam, in order to see how Chinese green produce is able to penetrate so deeply into the Vietnamese market.
Tuoi Tre first visited Po Chai, an open agricultural produce market in Pingxiang City in the Chinese province of Guangxi.
Po Chai is considered the largest source of green produce for cross-border sales to Vietnam in southern China. Every day, several hundred metric tons of agricultural produce of all kinds are transported to Vietnam in container trucks.
Most signs at the market are displayed in both Chinese and Vietnamese. On the left hand side of the venue is a large plot of land zoned for suppliers of mushrooms, grapefruits, watermelons, peanuts, grapes, tangerines, oranges and apples. The other side is a multi-hectare parking lot for container trucks exclusively carrying dragon fruits.
At the back of the market is a place for onion and garlic sellers.
Every five or ten minutes, a container truck will leave the market, heading toward the Tan Thanh border gate to enter Vietnam.
Truck drivers claim that up to 80 or even 90% of garlic consumed every day in Vietnam originates from the Po Chai market.
Po Chai is an open market in that none of the goods bear any information regarding manufacturers or expiry dates, with mushrooms the only exception.
During the observation by Tuoi Tre in mid-November, some 200 different container trucks using Vietnamese license plates frequented the market. Five of them specialized in carrying mushrooms, 30 were transporting onions and 50 trucks carried oranges, tangerines and apples, all bound for different Vietnamese wholesale markets.
“During peak times when demand in Vietnam is high, more than 100 trucks will leave Po Chai on a daily basis,” Linh, a Vietnamese trader of Chinese green produce, revealed.
Linh added that at the Tan Thanh border gate, there are more than 50 Vietnamese companies specializing in importing Chinese agricultural products.
In a typical scene observed by Tuoi Tre, one truck with the license plate of the northern Vietnamese province of Bac Giang arrived at the market at 2:00 pm, and was quickly loaded with boxes of Enokitake mushrooms.
The mushrooms were put into 150g bags, bearing labels in Vietnamese and English, saying they are Chinese products with a 30-day expiration date from the packaging date of November 15. However, there was no information regarding its manufacturer or place of harvest.
The truck driver revealed that he would take the mushrooms to Hanoi.
Speaking to Tuoi Tre, the Vietnamese driver of another truck waiting to carry Chinese grapefruits made no secret of the fact that the fruits would be on sale as domestically grown grapefruits for VND25,000 (US$1.1) each once they had entered Vietnam.
He added that the Chinese tangerine would be sold as Thai-grown fruit in Vietnam.
In addition to observing trucks picking up goods at the Po Chai market, Tuoi Tre also investigated how these cross-border imports passed customs at the Tan Thanh border gate.
On one day, correspondents followed a container truck registered to the southern Vietnamese province of Tien Giang, after it picked up some 1,470 20kg bags of garlic, or 29.4 metric tons, at Po Chai at 12:00 pm.
The truck then left Po Chai for Tan Thanh, where it quickly completed the exit-entrance procedure, before stopping at the goods-checking zone, located some distance from the border gate.
The truck spent around two hours at the checkpoint, where the driver ate lunch and took a short break. He then left and drove straight to Hanoi once he had received a set of papers from a woman.
Tuoi Tre managed to obtain and review those papers and found out that the garlic shipment was imported by a company named ĐP in Lang Son, a northern Vietnamese province bordering China, and distributed to a man named Binh in the southern province of An Giang.
The importer, DP, declared the imports to consist of 750 bags of garlic, weighing 15.22 metric tons, with a taxable value of VND83.5 million (US$3,728). This was only half of the actual weight of the shipment.
However, in the receipt issued for Binh, DP said the goods weighed 32 metric tons and cost VND188.8 million (US$8,429).
Also among the papers was a quarantine certificate, which stated that it had been “issued following a test on samples taken in the truck” even though the truck’s container had never been opened.
Tuoi Tre also discovered that the aforementioned DP company’s container truck had deliberately given wrong information on not only the weight of the shipment, but also the prices of the product.
Linh, the dealer of Chinese green produce, said that this is a trick used by all Vietnamese traders at Po Chai.
“While the mushrooms cost VND30,000 (US$1.34) to VND80,000 (US$8.57) a kg at Po Chai, the importers will only declare them to cost around VND10,000 (US$0.45) a kg with customs,” Linh said.
“That’s the unwritten ‘rule’ followed by everyone.”
Workshop develops Action Plan for WTO trade facilitation agreement
With support from the United States Agency for International Development (USAID), the General Department of Vietnam Customs organized a workshop to develop an action plan for implementation of the World Trade Organization (WTO) Trade Facilitation Agreement (TFA) in Hanoi on Novemrber 29.
The workshop was attended by Deputy Head of the General Department of Customs, Vu Ngoc Anh, Deputy Mission Director of USAID in Vietnam Craig Hart and Director of USAID’s Economic Growth and Governance Office Michael Trueblood.
The workshop brought together more than 50 government officials to develop a roadmap for implementation of the B and C commitments after the Agreement comes into effect.
The officials completed reviewing the list of Category A, revalidated the B and C commitments, and developed an action plan for implementation of the B and C commitments. The action plan details activities, objectives and outputs for each commitment along with the timeframe, needed technical assistance, responsibilities of each agency, and the mechanism for coordination.
The GDVC of the Ministry of Finance will report the action plan to Vietnam’s newly created National Trade Facilitation Committee (NTFC). The final list of Category B and C commitments will be notified to the WTO Secretariat when the Agreement comes into force.
Once in effect, the TFA will enhance national and business competitiveness and boost trade and investment in Vietnam by committing Vietnam to reforms in support of trade facilitation.
This workshop is one of a number of activities on which the USAID Governance for Inclusive Growth (GIG) Program is collaborating with the General Department of Vietnam Customs and other donors to successfully implement the TFA.
The Government of Vietnam is working with USAID through the GIG Program on a number of other reforms in cooperation with Vietnam’s business community and organizations to support sustainable, inclusive economic growth in Vietnam.
Quang Ninh looks to optimise maritime economic potential
Located on the northern coast with advantages in location and natural resources, Quang Ninh is striving to tap its full potential in maritime economic development.
As part of efforts to implement Resolution 09-NQ/TW on Vietnam’s Sea and Island Strategy until 2020, Quang Ninh has applied measures to boost its sea-based economy in line with ensuring national security and defence.
In recent years, the province has focused on infrastructure building to boost maritime economic development, especially tourism and aquaculture.
Currently, all Quang Ninh’s seaports have been upgraded to strengthen their capacity in providing services and connecting the mainland and islands in the region.
Some seaports in the locality are being expanded to national and regional scale, including Hai Ha, Cai Lan and Cua Ong.
Quang Ninh has also mobilised resources for the comprehensive development of infrastructure in coastal economic zones and industrial parks (IPs), including the Van Don EZ and Hai Ha, Dam Nha Mac, Viet Hung and Hai Yen IPs, attracting more investment.
Investment promotion activities have been used to call for investment in major projects, including Van Don airport, Van Tien bridge, major seaports and roads, as well as other projects in entertainment, resorts, aquaculture and fishing.
The province has built four concentrated IPs with a total area of more than 911 hectares, along with nine district-level industrial clusters spanning from Dong Trieu, Uong Bi, Yen Hung to Hai Ha and Mong Cai, with a combined area of 215 hectares. Three of the industrial clusters have leased 80% of their lands.
Meanwhile, the province aims to welcome 8-10 million visitors in 2020 to earn VND5-VND6 trillion.
In the first 10 months of 2016, the province saw a five percent rise in the number of visitors with 7.3 million total arrivals. The number of foreign tourists reached 2.81 million.
Quang Ninh has four major tourist hubs. The Uong Bi-Dong Trieu-Quang Yen area is home to many spiritual and cultural sites, while Ha Long Bay is famous as a centre for sight-seeing, culture, shopping and entertainment.
The Van Don-Co To area offers spiritual, sea and island and entertainment tourism, and the Mong Cai area is strong in sea tourism and shopping.
According to the provincial Department of Tourism, Quang Ninh currently has 157 accommodation establishments rated from one- to five-stars, along with 47 travel firms and nine beaches for tourists.
Recently, the provincial Department of Tourism teamed up with the Vietnam National Administration of Tourism to organise a fam trip for travel firms and media agencies across the country to various destinations around Ha Long Bay.
A number of local firms, including Hoang Gia, Tuan Chau, Van Don and Mong Cai, have offered new tourism products.
Realising Party and State policies on encouraging and supporting maritime economic development, Quang Ninh has created optimal conditions for businesses and individuals to access capital for boosting economic growth.
So far, many projects have proved their effectiveness, contributing to the local maritime economic expansion and increasing income for locals in coastal localities.
Ministry may pull the plug on Dung Quat Shipbuilding Industry Co., Ltd
As reported by newswire vneconomy.vn, bankruptcy is one of the options for Dung Quat Shipbuilding Co., Ltd., Vietnam National Oil and Gas Group (PetroVietnam)’s shipbuilding subsidiary.
The Ministry of Industry and Trade in its report on developing industries in the last three months of the year outlined three possible solutions for the plant.
First, the ministry proposed restructuring the plant, while leaving the question whether it would remain a subsidiary of PetroVietnam open
The second solution is to put the company under the management of another. This transfer would be planned by PetroVietnam.
The third is to let the company go bankrupt.
The ministry added that it is going identify individuals and groups responsible for the shipbuilding company’s failure.
Dung Quat Shipbuilding Industry Co., Ltd., established in 2006, was a member of Shipbuilding Industry Corporation (SBIC), formerly Vinashin. In 2010, the company was transferred under the management of PetroVietnam.
The company has been incurred billions of dollars in cumulative losses . According to PetroVietnam’s financial statement, as of the end of 2015, PetroVietnam was holding 100 per cent of Dung Quat Shipbuilding Industry Co., Ltd., equal to a capital of VND1.99 trillion ($90 million). PVN has made a 100 per cent provision for the risk of this investment.
The report also mentioned other major projects invested by PetroVietnam, including Nghi Son Refinery, Dinh Vu Polyester Fibre and Yarn Plant, and a number of struggling biofuel plants.
Specifically, the MoIT asked PetroVietnam to build a plan to consume the refinery’s products. Earlier, PetroVietnam complained about the big loss this would cause, but the plea fell on deaf ears at the ministry.
As for Dinh Vu Polyester Fibre and Yarn Plant, the MoIT asked PetroVietnam to negotiate with potential partners to be involved in the plant’s management. For the ethanol plants, the MoIT asked PetroVietnam or PVOil to sign cooperation contracts with localities and companies on distributing its E5 fuel product. PVOil should also look for another investor to buy its stake in PetroVietnam Bio-Fuels JSC (PVB).
Processors fraught with tra fish shortfall
China’s huge demand has driven up prices of unprocessed tra (Pangasius) fish in the Mekong Delta, putting domestic processors on edge.
The total acreage under Pangasius farming has reached 5,352 hectares this year, up 4% year-on-year, which has sent output soaring 9% to 996,000 tons, according to data of the Ministry of Agriculture and Rural Development.
Key farming areas in the Mekong Delta have reported a substantial increase in Pangasius fish production. For instance, Dong Thap Province has turned out 325,000 tons of tra fish, a 19% increase, Can Tho City 140,000 tons, up 24%, and Ben Tre Province 155,000 tons, up 11%.
However, prices of the fish have picked up to VND22,000-22,500 per kilo. In October 2015, Vietnam harvested around 946,000 tons, a 6% rise over the same period of 2014, but the price fell to VND20,000 per kilo.
Big demand of the Chinese market is attributable to the price hike. China imports processed and unprocessed fish from the Mekong Delta.
Truong Dinh Hoe, secretary general of the Vietnam Association of Seafood Exporters and Producers (VASEP), said 70% of the current tra output is from farms of enterprises, and the rest from individual farmers who often choose to sell to Chinese traders, leading to a shortfall of fish at local processors.
Hoe urged local processing firms to draw up plans to secure sufficient Pangasius stock or their production will be severely affected.
Data of VASEP shows that Pangasius exports have totaled nearly US$1.4 billion so far this year, with around 40% of it coming from the U.S. and China. Shipments to China alone have surged 76% year-on-year to US$235.5 million.
VASEP predicted China would overtake the U.S. as the biggest importer of Vietnam’s tra fish next year.
Public consultation on Long Thanh International Airport design
The Airports Corporation of Vietnam (ACV) on Monday displayed nine design options for Long Thanh International Airport for public consultation.
The designs which will be displayed until December 12 at the Vietnam Exhibition Centre for Culture and Arts at.2 Hoa Lu Street, Hanoi.
Visitors to the exhibition are encouraged to offer their opinions and make suggestions.
ACV said that they will also bring these designs to display in Danang from December 16-25, Dong Nai from December 28 to January 11, 2017 and HCM City from January 13-23, 2017.
The nine designs were selected from a contest held recently by ACV to find the best design for the passenger terminal of the Long Thanh International Airport in the southern province of Dong Nai.
Contestants were required to design a passenger terminal with total floor space of around 400,000 square metres and handle 25 million passengers a year in the first phase. It should meet the requirements of the International Civil Aviation Organisation and the International Air Transport Organisation for services at leading airports around the world.
The passenger terminal should also be connected consistently with infrastructure facilities at the airport and in line with the approved master zoning plan for the multi-billion airport, which is envisioned becoming an aviation hub in Southeast Asia.
The long-awaited project is expected to start in 2019 with total investment amounting to USD16.03 billion. The project will be divided into three phases and is planned to handle 100 million passengers and 5 million tonnes of cargo a year.
The project will be financed by the State budget, official development assistance loans, capital contributed by enterprises, proceeds from equitisation of state-owned enterprises and other sources.
Consumption loans jump in HCM City
Consumer credit in HCM City has grown by an average of 20 per cent per year during 2012-2015, according to the State Bank of Viet Nam.
Nguyen Hoang Minh, Deputy Director of State Bank’s HCM City branch said consumption loans during this period accounted for between 6 per cent and 8 per cent of the city’s total outstanding loans.
This figure, he said, has strongly increased this year. By the end of October this year, it was VND201 trillion (US$8.9 billion), accounting for 14.7 per cent of the city’s outstanding loan.
This figure will continue to rise, Minh said, explaining that 40 per cent of consumption loans in HCM City are for buying cars, houses and housing upgrades.
To develop consumption lending activity in HCM City in particular and in the country in general, Minh said that the State Bank was collecting ideas to further develop a consumption loan draft law, which is planned to be effective next year.
This is the second time that the SBV has sought to collect ideas about consumer credit. Until now, regulations have applied to all lenders, including banks and credit companies, even though their borrowers are different.
Thus, the new draft regulation is aimed at helping to create convenient conditions for both borrower and lender as well as to have a more transparent market.
At a recent conference organised in HCM City, Bui Quang Tin, an expert from Banking University in HCM City said the second draft had many updates necessary for the current time when consumption lending is strongly developing.
“It is amended with stricter regulations and will help the market to be more stable,” Tin said.
The new draft would help consumers get official loans from credit companies instead of from the black market, he said.
Sharing the same idea, Vuong Thuy Tien, a high-ranking official from private lender Home Credit Viet Nam said the draft had clear regulations about the rights and responsibilities of credit companies.
“This is an important amendment in order to have a sound credit market as well as to protect customer rights,” she said.
However, experts say that some of the proposed changes to the regulation don’t reflect reality.
One among them is the proposed regulation saying that the maximum consumption loan should be VND10 million (US$444).
Pham Hai Van, Legal Director of FE Credit, said this level was too low.
She explained that the current smallest loan to buy a motorbike was about VND17 million ($772).
Sharing the same idea, Tien from Home Credit said loans ranging from VND10 million ($444) to VND30 million represented 71 per cent of her company’s total contracts.
Only 10 per cent of contracts are valued under VND10 million.
They also said that the maximum interest rate for overdue debt of 150 per cent per month on top of the initial interest rate in the proposed regulation was not high enough.
Tien said this regulation would force credit companies to change their products. For instance, Home Credit is currently able to charge 0 per cent interest on about 65 per cent of the company’s debt. If the proposed cap of 150 per cent on overdue loans were implemented, Home Credit would not be able to afford to offer loans with 0 per cent interest rates.
This new regulation should not be applied to loans with tax exemptions, she said, adding that that would cause difficulties for a credit company to control bad debt.
Tin said “currently, the draft protects consumers more than credit companies, who would face many difficulties in getting loans back.”
He suggested applying a maximum interest rate of 200-250 per cent in addition to the initial rate for bad debt. For debt with tax exemptions, the rate should be based on the amount of debt that the consumer had not paid.
Minh affirmed that State Bank of Viet Nam was still collecting ideas from related subjects. All ideas would be sent to the bank for further consideration.
Vietnam Expo 2016 to be held in HCMC
The 14th Vietnam Expo will take place at the Saigon Exhibition and Convention Centre in HCM City from November 30 to December 3.
It is expected to draw the participation of businesses from more than 20 countries and territories, including Indonesia, South Korea, mainland China and Taiwan.
According to the Ministry of Industry and Trade, with the sponsorship of Mobifone, the event will provide a platform for businesses to meet, expand and promote trade and investment.
Indonesia is the country of honour at this year’s expo, sending over 60 businesses to display modern technology products at the event.
The South Korea’s state businesses and provincial trade organisations, such as the Bucheon Chamber of Commerce and Industry, and representatives of Incheon, Suwon and Daejeon authorities will be among those present. Nearly 100 Korean businesses will introduce their latest technologies, services and products at the expo.
The event will also see the introduction of hardware tools and eco-friendly technologies.
Vinatex transfers Hanosimex holding to new subsidiary
The Vietnam National Textile and Garment Group (Vinatex) has announced the transfer of 11.8 million shares in the Hanoi Textile and Garment JSC (Hanosimex) to the recently-established Northern Corporation (VNC Corp), to contribute capital to the new company.
The number of shares transferred is equivalent to 57.5 per cent of Hanosimex’s charter capital, meaning Vinatex is no longer its major shareholder.
Vinatex launched VNC Corp on April 12. The new company has charter capital of VND500 billion ($22.4 million) and was formed following a merger of four Vinatex subsidiaries: the Dong Xuan Knitting Sole Member Limited Liability Company, the Vinatex Hong Linh JSC, the Ha Noi Textile and Garment Joint Stock Corporation, and the 8-3 Textile Limited Company.
Vinatex’s revenue in the third quarter stood at VND4.1 trillion ($18.4 million) and after-tax profit VND152 billion ($6.6 million). In the first nine months of this year revenue reached VND11.3 trillion ($497.2 million) and after-tax profit VND455 billion ($20 million).
Vinatex has targeted export turnover of $2.6 billion this year, representing growth of 10 per cent. “The US, Japan and the EU will remain key markets for Vinatex,” Ms. Pham Ngoc Han, Head of the Shareholder Relations and Information Communications Department at Vinatex, told VET in June.
The group also aims to develop the original equipment manufacturer (ODM) – free-on-board (FOB) model as a breakthrough in increasing its competitiveness domestically and with textile exporters in other countries such as China, India, and Bangladesh.
Last year it established a Supply Chain Development Center (SCDC) and two corporations in the north and the south of the country to create a supply chain from raw materials to finished products, making the most of production capacity at its subsidiaries.
CEO Mr. Le Tien Truong told its annual general meeting that the group will implement a range of solutions to record growth of 10 per cent this year, including supporting its subsidiaries to expand markets and improve market share and establishing an FTA research team to develop business plans and avoid internal competition.
Vinatex now has 85,000 employees earning an average monthly income of VND6.3 million ($284). Last year its industrial production value stood at over VND36 trillion ($1.62 billion), revenue VND39.5 trillion ($1.77 billion), and pre-tax profit VND628 billion ($28.2 million).
Vietnam’s textile sector was expected to benefit from the TPP, but after US President-elect Donald Trump said the country would withdraw from the deal the future is now uncertain.
“If the TPP is implemented it will bring many benefits to Vietnam in many sectors,” said Minister of Industry and Trade Tran Tuan Anh. “Vietnam’s key export products like textiles, garments, footwear, and seafood will likely see breakthroughs in export value to the US, Japan and Canada. If the TPP is not implemented, Vietnam still has other export markets.”
Tek Experts expands operations in Vietnam
Tek Experts Vietnam, a subsidiary of multinational group Tek Experts has unveiled its new headquarters on Sunday (November 270.
The headquarters is located at Level 16 of South Korean-built Lotte Centre Hanoi, marking a new phase of the company’s growth in Vietnam. The spacious and cutting-edge new office is part of Tek Experts’ plan to launch Vietnam as one of its strategic markets on the world map.
Yaniv Natan, founder of Tek Experts, said that “After almost four years in Vietnam, we’ve grown from a small team of only 20 to being an operation that now employs more than 250 and this is just the start of our journey. We have ambitions plans to grow the size of our Vietnamese operation to more than 1,000 over the next two or three years because we believe Hanoi is perfectly placed to help us better serve Tek Experts’ customers in Southeast Asia and internationally.”
Tek Experts’ philosophy is to offer a highly customer-centred approach to technical support and professional services and we believe Hanoi offers the perfect combination of a business-friendly environment and a strong talent base that is crucial to our development and growth, Yaniv added.
Nguyen Manh Tuong, country manager of Tek Experts Vietnam also said that Tek Experts constantly strives to offer the best environment for its people to grow, to develop their skills and expertise, and to become the leaders. “We’re committed to providing best-in-class training programmes, to supporting our people throughout their careers and, with our new state-of-the-art office, provide an exciting and innovative environment for them to work.”
“With our plans for growth and expansion across the world we’re able to offer exciting opportunities to people across Hanoi looking to pursue a rewarding career in the information and technology industry and we’re excited to become an employer of choice in Vietnam,” he said.
With offices and employees worldwide, Tek Experts is dedicated to provide industry-leading software support, application development, training and education, sales support, customer care, hardware support and software solutions across Europe, Asia and the Americas.
11M FDI disbursement up y-o-y
Total disbursement of foreign direct investment in the first eleven months of this year stood at $14.3 billion, up 8.3 per cent year-on-year, according to the latest report from the Ministry of Planning and Investment (MPI).
New and additional FDI capital totaled $18.1 billion, representing 89.5 per cent of the figure in the same period of 2015.
As at November 20, 2,240 new projects had been granted investment licenses with total registered capital of $13 billion, equal to 96.1 per cent of the figure in the same period last year, while 1,075 existing projects added $5.07 billion in capital, equal to 76.1 per cent.
Export turnover in the FDI sector (including crude oil) in the first eleven months was $114.1 billion, up 8.6 per cent compared to the same period last year and accounting for 71.5 per cent of the total. Excluding crude oil the figure was $112 billion, up 10.3 per cent and accounting for 70.2 per cent.
Import turnover in the FDI sector was $92.8 billion, a 3.6 per cent increase year-on-year and accounting for 59.2 per cent of total import turnover. The sector therefore recorded a trade surplus of $21.2 billion including crude oil and $19.1 billion excluding crude oil.
Nineteen sectors received investment, in which manufacturing and processing attracted the most, with 907 newly-registered projects and 766 projects adjusting their capital, for a total of $13.41 billion, or 74.1 per cent of all registered capital in the first eleven months.
Real estate was second, with 49 new projects and total capital of $740.9 million, or 4.1 per cent of the total. Following the US election, most commentators believe President-elect Donald Trump will no longer continue with the proposed TPP agreement. “It is too early to say whether the agreement will be scrapped altogether or an amended, watered down version will be adopted,” said Mr. Stephen Wyatt, Country Head of real estate consultants JLL.
If the TPP is adopted in its current form, Mr. Stephen Wyatt believed Vietnam would stand to be one of the largest beneficiaries, which would filter down into the real estate market, due to the increased FDI the country would witness. “If the TPP does not proceed, the level of FDI will be less, but Vietnam has signed a number of other FTAs with other countries and regions recently, which will help to keep FDI at a healthy level,” he added.
Professional activities and science and technology ranked third, with $684.84 million, or 3.8 per cent.
Foreign investment came from 68 countries and territories, led by South Korea, with total new and additional capital of $5.2 billion, or 29.2 per cent of the total. Singapore followed, with $2.05 billion, or 11.3 per cent, then Japan with $1.95 billion, or 10.8 per cent.
Fifty-four cities and provinces received investment, led by northern Hai Phong city with 45 new projects and 35 projects adjusting their capital, totaling $2.74 billion, or 15.2 per cent of the total.
Southern Binh Duong province was second, with new and additional capital of $1.93 billion, or 10.7 per cent, followed by southern Dong Nai province, Hanoi and Ho Chi Minh City, with total new and additional capital of $1.87 billion, $1.84 billion and $1.32 billion, respectively.
Projects granted investment licenses in the first eleven months included the LG Display Hai Phong project, with capital of $1.5 billion, the LG Innotek Hai Phong Plant, with $550 million, a $315.46 million seaport and industrial park complex in Quang Yen town, Quang Ninh province from the CDC Corporation, headquartered in the Cayman Islands, the Middle Utilities Company Pte. Ltd from Singapore, and the Infra Asia Investment Limited from Hong Kong, and Amata Long Thanh City in Dong Nai province, with $309.3 million from Thailand’s Amata Corporation.
Farming exports bring in US$29.1 billion in 11 months
Vietnam brought in US$29.1 billion from agricultural, timber and fishery exports in the first eleven months of the year, up 5.9% over the same period of last year.
Revenues in November alone were estimated at US$2.69 billion, according to the Ministry of Agriculture and Rural Development.
During this period, Vietnam shipped 4.54 million tonnes of rice, earning US$2 billion, down 25% in volume and 20.3% in value compared with the first eleven months of 2015.
The decline in value was less than that in volume because average prices in the first ten months were up 5.6%.
China has remained the largest buyer of Vietnamese rice with 36%, followed by Ghana, which accounted for 11.5% of Vietnam’s total rice exports.
Rubber export revenues went up 4.6% to US$1.43 billion along with a 12.3% increase in shipment volume, estimated at 1.1 million tonnes. Exports to China and India accounted for nearly two thirds of Vietnam’s rubber exports.
Coffee and cashew exports continued to see steady growth, earning US$2.98 billion and US$2.59 billion, respectively.
Exports of timber and timber product brought in US$6.2 billion—largely unchanged from the same period of last year—while seafood revenues increased 6.9% to US$6.4 billion.
The US, Japan, China and the Republic of Korea were the largest importers of Vietnamese seafood, accounting for more than half of the country’s total shipments in the first ten months of this year.
SCG Packaging launches new packaging solutions
Recently, in the VietFood & Beverage – ProPack 2016 exhibition, SCG Packaging – a subsidiary of SCG has introduced its latest packaging technologies in a wide range of high quality packaging products under the theme of “Answers for Food Industry”.
The focus of this exhibition is flexible packaging alternatives serving for extensive demands of food industry, including packaging for frozen food, dried food, animal feed and especially SCG’s own food packaging brand called “FEST”: Food Grade Packaging made of virgin pulp to reduce the use of non-biodegradable plastic and foam.
These food safety products also come in various sizes and shapes to fit with different types of contained food, and also serve as safe alternatives for consumers who, nowadays, have been more and more concerned about their health.
“Vietnam has a growing population with rising demands for fast moving consumer goods, especially in Food and Beverage industry. This puts forth a challenge for packaging providers to find more sustainable solutions that are high quality, safe for health and also environmental friendly, to answer the ever-changing requirements of this highly competitive sector,” said Mr. Somchart Patamamongkonchai, General Director of Tin Thanh Packing Joint Stock Company (Batico).
“As our commitment to be the Total Packaging Solutions Provider for all industries, SCG Packaging would like to ensure our customers that we can offer wide-ranging high quality packaging and solutions which match their requirements and could help them grab the leading position in this market”.
The event highlights various types of high quality packaging alternatives that could reveal the use of the amazing packaging technology regarding both printing and structure. Some of the key products include:
-Valve Coffee Bag for Coffee & Beverage Industry: a coffee packaging attached with one-way degassing valve which releases a gas produced by newly roasted coffee beans and prolongs coffee’s life and quality.
-Flat Bottom Bag: a packaging for more premium appearance and perfectly stable shape of the products whenever they are put on shelf.
-SCG’s own packaging brand “FEST” for freshly cooked food: Food Grade Packaging made of virgin pulp to reduce the use of non-biodegradable plastic and foam. This invention, developed solely by SCG is first to be awarded GMP (Good Manufacturing Practice) in Thailand, on par with EU standards, USFDA standards, and EU regulations. It addresses consumer needs and promotes better health for consumers.
SCG Packaging is one of SCG’s core businesses dedicated to becoming a total packaging solution provider. The company pledges to deliver a broad spectrum of innovative products and services as well as packaging solutions that add value for customers and consumers. Backed by highly skilled personnel with world-class know-how and expertise, SCG Packaging carries out business in tune with the principles of corporate governance and with a relentless commitment to sustainable development encompassing economic, social, and environmental aspects.
Vietnam Airlines, Vietjet offer cheap tickets at VND 0
The national flag carrier Vietnam Airlines (VNA) is offering a promotional discount of 20-30 percent on some domestic and international routes in November and December.
Accordingly, after using promotional code toward a purchase on Friday, Saturday and Sunday in November and December, Vietcombank cardholders will receive a promotional discount of 20 percent for domestic flights and 30 percent on international routes from Vietnam to Thailand, Singapore, Malaysia, Indonesia, Laos, Cambodia, Myanmar, China, Japan, South Korea, Hong Kong (China), and Taiwan (China).
Meanwhile the low-cost carrier, Vietjet will give 1.5 million tickets costing at just VND0 on some domestic and international routes from December 1- November 28 (excluding public holidays).
The special price will be applied for international routes from Vietnam to Hong Kong (China); Pusan and Seoul of South Korea; Kaohsiung Taipei, Taichung, Tainan of Taiwan (China); Singapore, Thailand’s Bangkok, Kuala Lumpur in Malaysia and Myanmar’s Yangon.
Passengers can buy tickets for local flights departing from December 1-March 25, 2017 and international flights taking off on December 1-November 28, 2017 at 12 p.m. -2 p.m.
FDI disbursement reaches $14.3 billion in 11 months
Foreign direct investment (FDI) disbursements reached $14.3 billion during the first 11 months this year, a year on year increase of 8.3 percent, reported Foreign Investment Agency under the Department of Planning and Investment.
FDI capital totaled US$18.1 billion accounting for 89.5 percent of the number during the same period last year, 2,240 new projects were licensed and 1,075 projects registered to adjust investment capital.
Foreign investors invested in 19 industries and fields in Vietnam. Of them, manufacturing and processing field was the most attractive one with the total capital of $13.41 billion from 907 new and 766 capital adding projects.
Hai Phong city attracted the highest FDI capital totaling $2.74 billion from 45 new and 35 capital adding projects, followed by Binh Duong province with $1.93 billion, Dong Nai $1.87 billion, Hanoi $1.84 billion and HCMC $1.32 billion.