finance & business news 18 May 2017 · 2017. 5. 18. · Intellasia 18 May 2017 3 / 66 FINANCE...

18 May 2017

finance & business news

FINANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Reference exchange rate goes down 2 VND 1New regulations influencing banking operations in 2017 2Banking system's liquidity positive after months 3SBV to reconsider the ratio of short-term capital for medium

and long-term loans 3Bad debt settlement remains slow 4How much do banks spend on information security? 5VN proposes Apec initiative to facilitate e-commerce 6Conference helps exporters improve e-commerce 6Banks recruited over 1,000 new employees in Q1 7AIA and HSBC form new bancassurance partnership 7Vietinbank becomes settlement unit in derivatives market 8Central Bank approves BIDV bond issue of $900 million 9Apec 2017: Long-term infrastructure investment discussed 9Apec ministers to seek clarity on trade in Hanoi 9SOM 2 discusses Apec priorities 10Vietnam's inflation cooling gradually HSBC 11State budget faces deficit as fuel import tax cut down 11Vietnam's fuel association calls for tax hikes as zero import

duty nears 12EVFTA to boost IP development: expert 12Vietnam proposes four initiatives to boost Apec financial

cooperation 14Vietnam among Asia's growth leaders 14FDI's link to growth disparity 15Rice exports expected to face tough competition 17Vietnam warned about cement oversupply, narrower

export markets 17Are private businesses in Vietnam private ones? 18Economists warn of Vietnam's growing trade deficit

towards Korea 20China emerges as Vietnam's largest fragrant rice importer 21Japan becomes largest importer of VN's shrimps 21Deputy PM puts emphasis on expressway project 22HCM City still prone to inundation as many flood control

projects undone 23Homes unpossessable for foreign owners made public 24Deputy PM puts emphasis on expressway project 24Vietnam's first smart city communications platform launched 25$18.15 million disbursed for Cat Linh Ha Dong railway project 26Thai Nguyen spends 840 billion VND on agricultural restructuring 26Government instruction bans overlapping inspections at firms 27Expert sees no need for SME support law 28Businesses appreciate government Resolution 35 on

developing enterprises 28Barriers to business hard to dismantle 29How to develop private equity in Vietnam 30PM conference with businesses seeks development measures 31Government to focus on reducing costs of doing business 32Vietnam business leaders losing battle to become competitive 34

Tax, customs policies remain roadblocks to enterprises 35Change is coming 35No escape 38'Secret payments' and red tape holding back Vietnamese

companies 41Vietnam cleaning up its business environment survey 42Vietnam's convenience store market not easy to exploit 42Region eyes global cashew cooperation 43Central coastal provinces eye sustainable shrimp farming 44M&A in real estate hikes early in year 45Vietnamese, German businesses seek partnerships through

digitalisation 46Vietnamese, Indonesian localities boost partnership 46Oman wants to boost investment in Hanoi 47Major travel firms forecast strong summer tour bookings 47Eyes on the smartphone prize 48

BIZ NEWS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Business Briefs May 18, 2017 50Market flat but turnover soars 50Stocks trade lower on profit-taking, oil prices 51Plastic company leaders to sell 27pct ownership 52TLG to pay off residue dividend 52US firms encouraged to join smart city project 52HCM City backs Tan Son Nhat airport expansion 52PV Gas licensed to build $1.27 billion gas pipeline 53Zalora, Robins-Fashion and Beauty merge 53Local firm to make unbaked construction materials from

ashes, cinders 54Mobiistar unveils 2 'selfie' smart phones 55Chinese low-cost airline opens air route to HCM City 55Vinamilk imports more than 2,000 cows from the US 55Misumi automates production 56Peugeot Scooters aims to diversify Vietnam's premium

scooter segment 57La Casta: Western charm in the Western gate of Hanoi 58A New Wing Takes Flight in Hoi An's Old Town 58Central Field to open in Q3 59Can Tho's new air route subsidy plan stirs controversy 59City to help Laos call for investment 61Da Nang to investigate real estate violations 61Over 200 firms to attend screen and digital printing tech expo 61Vietnam International Motor Show to introduce new car models 62Major auto brands confirm presence at 3rd Vietnam

International Motorshow 62Event connects businesses exporting products to China 63Construction and building materials expo opens in Hanoi 63Vietnam finishes third in Southeast Asia race for tourist dollars 64Young Vietnamese leaders attending Australia-Vietnam Young

Leadership Dialogue 64WannaCry virus attacks 1,900 computers in VN 65Shim to serve second term as Samsung Vietnam CEO 66

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Vietnam finance & business 18 May 2017

FINANCE
18/MAY/2017 INTELLASIA| VNA
The State Bank of Vietnam set the reference VND/USD exchange rate at 22,368 VND/USD on May 18, down 2 VND from the day ago.With the current +/- 3 percent VND/USD trading band, the ceiling exchange rate is 23,037 VND per USD and the floor rate is 21,698 VND per USD.Major commercial banks made slight changes to their rates.Vietcombank listed its buying rate at 22,650 VND/USD and its selling rate at 22,720 VND/USD, up 5 VND.Meanwhile, BIDV cut its buying and selling rates by 5 VND to 22,645 VND and 22,715 VND, per USD.Techcombank retained its buying and selling rates at 22,630 VND 22,720 VND/USD.http://en.vietnamplus.vn/reference-exchange-rate-goes-down-2-vnd/111880.vnp

New regulations influencing banking operations in 2017

18/MAY/2017 INTELLASIA| DTCK

Unlike conventional businesses, each business of banks is based on a series of regula-tory documents, processes and regulations.Internal banking regulations are closely related to legal documents. When the law changes, the internal processes of banks must also change.Basic changes from the Civil Code 2015The Civil Code 2015, which came into effect on January 1st 2017, has immediately af-fected the banking system.Let's looking at a case where a bank lends capital to a business to invest in a system of machinery and equipment. As soon as the customer buys the machinery system, the bank and customer have signed contract for mortgage and registration of secured transaction.If in the past, the privilege of handling secured assets certainly belonged to the bank, the bank now cannot be subjective because there is a new provision in the Civil Code 2015 that changes this issue. That is a security measure called "title retention on assets", which appears next to the familiar security measures such as mortgage, pledge, guar-antee, and guarantee on collateral deposit, etc.The retention of tile on assets allows the seller to retain the ownership of the assets un-til the payment is complete. Assuming that the parties use "title retention on assets" and register the secured transaction in advance, the mortgage contract of the bank will rank second in order of preference.Not only has the "retention of title", "lien on assets security has also been added as a measure to ensure the completion of the obligations in civil transactions. Thus, these changes require the banking system to undertake studies to update and use the new securities in loan security operation or detect risks and make management solutions.The Civil Code 2015 also has a number of new points, such as the more open authori-sation mechanism. Previously, the authorisation could only be done once, but now it can be reauthorised several times with statutory conditions.The regulations on legal entities such as individuals, legal persons, and households have been changed. Notably, the new regulations on the lending contract, interest rate (ceiling interest rate of the contract), overdue interest rate and penalty rate are all new-ly regulated in the Civil Code. These regulations will have direct impact on the system of banking operations such as account transaction, capital mobilisation, lending, and guarantee, etc.New guidelines of the State Bank of Vietnam (SBV)Not only being affected by the new regulations of the Civil Code, banking business is also subject to a series of new professional regulatory documents. SBV has issued nu-merous circulars regulating the banking operations. Some circulars will have immedi-ate impact on the banking sector such as Circular 39/2016/TT-NHNN.From March 15th 2016 onwards, all lending activities of banks, which used to be im-plemented on the basis of the Lending Regulation No.1627 over the past 16 years, must be changed based on the provisions of Circular 39/2016/TT-NHNN.Some circulars will take effect later in the middle of the year such as Circular 35 on in-formation security for internet banking services (effective from July 1st 2017) and Cir-cular 41/2016/TT-NHNN, which will effect from January 1st 2020. However, if studied thoroughly, banks should be aware of the deadline of Circular 41, which turns out to

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be not as long as it is seen. The ratios and capital safety limits for banks under the guid-ance in the Circular need to be urgently studied and prepared. Banks which lack of in-itiative in coping and implementation plans may face difficulties in realising the growth plans in the coming years.In addition, there are new business policies coming from the guidance documents of the SBV such as Circular 43 on consumer lending of finance companies or Circular 40 on commodity derivative products of commercial banks.Although banks have actually implemented these types of transactions, the new regu-lations in these circulars will establish a formal legal basis for the operation.With the new regulations mentioned in the above, banks must make various changes to the system of business processes in 2017.

Banking system's liquidity positive after months

18/MAY/2017 INTELLASIA| VNS

Liquidity in the inter-bank market has showed positive signs after several months of being under pressure.The latest report from Saigon Securities Incorporate (SSI) showed that the central bank withdrew a total of VND18.46 trillion (US$811.4 million) through open market opera-tions (OMO) last week, reducing the money being circulated in OMO to VND6.54 tril-lion, the lowest level in the past two months.This is the first time since Tet (Lunar New Year) that the banking system has shown abundant liquidity. The central bank had to inject a significant amount of money through OMO to support liquidity of the banking system in the past months.In the past week, owing to good liquidity, interest rates in the inter-bank market slid down constantly, hitting a two-month low of 4.16 per cent on May 11, down 27 basis points against the previous week.http://bizhub.vn/banking/banking-systems-liquidity-positive-after-months_286215.html

SBV to reconsider the ratio of short-term capital for medium and long-term loans


Speaking at the prime minister's meeting with businesses, State Bank Governor Le Minh Hung said that the current inadequacy is medium and long-term credit still ac-counts for 53-55%, while the mobilisation of medium and long-term capital only ac-counts for 13-15%.This is a very huge risk for banking activities when there is the imbalance in the pro-portion of short-term capital for medium and long-term loans.The Governor said under the roadmap, the maximum proportion of short-term capital for medium and long-term loan is 50 percent in 2017 and will be 40 percent in 2018. The supply of medium and long-term capital should be carried out through securities channel but due to Vietnam's characteristics, this source of capital is mainly mobilised through banking channel."Therefore, in the near future, the State Bank will assess the monetary policy develop-ments to consider adjusting the proportion of short-term capital for medium and long-term loans to be more suitable to the reality in order to reduce the pressure on com-mercial banks", said Hung.At the meeting, Governor Hung also said in 2016, in spite of facing many pressures such as high bond issuance capital and rising inflation, the banking sector still tried to lower interest rates (down 0.2-0.3 percent at the end of 2016). Therefore, interest rates have been stable since the end of last year and are only equal to 40 percent of the inter-est rates in 2011.Explaining the low interest rates in some countries such as Japan, South Korea, etc., Hung said these countries have stable macro-environment, low inflation has main-tained for many years; businesses have the ability to make plan for production and business activities; business capital is not overly dependent on bank credit.Meanwhile, Vietnam is a developing country, the capital demand for development is great, the economy is stable but inflation has not been stable yet, etc., which affects the lending rates of banks.


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Compared to countries in Asean region, the lending rates in Vietnam at 6-11%/annum and foreign currency at 3-4%/annum is relatively reasonable compared to the context of Vietnam and the region."In the coming time, the State Bank will continue directing to maintain stable macro interest rates, instructing banks to continue reducing lending rates, attaching impor-tance to loans to small and medium enterprises (SMEs), and startups, etc.", said the Governor.As per the Governor, the recent credit operation has achieved positive result when the credit growth in the past year was 18.25%. This year, credit rose 5.76 percent as of the end of April a relatively high growth rate compared to the previous years, of which credit in dong swelled 5.8 percent and foreign credit improved 4.6%."Currently, the capital demand of the economy is very large but resources have not been cleared because most of the capital still lies in bad debt", said Hung. He added that the government has submitted to the National Assembly Standing Committee the resolution on bad debt settlement, and the Law on amendment and supplementation of some articles of credit organisations. If being approved soon, it will create a synchro-nous and uniform settlement mechanism, releasing a large volume of collaterals and creating favourable condition to reduce lending rates of businesses.Regarding the exchange rate management, Hung said over the last period, the State Bank has been relatively cautious in regulation. In 2016 and the beginning months of this year, the exchange rate operation also faced many difficulties after Brexit event, the policy of the US President, the US Federal Reserve, the strongly increasing trend of the US dollar in the world along with adverse factors in the country. However, the reg-ulation of central rate and the synchronisation of other tools have helped stabilise the foreign currency market.The exchange rate increased an average of 1.1-1.2 percent in 2016. The foreign ex-change market is rather stable, contributing to the macro stability and supporting busi-nesses and foreign investors. In addition, the State Bank has purchased the largest amount of foreign exchange ever, helping to increase the national prestige.

Bad debt settlement remains slow

18/MAY/2017 INTELLASIA| INFONET

The draft resolution on bad debt settlement will be submitted to the National Assem-bly at the meeting that takes place from May 22. This resolution will help speed up the process of forming a secondary bad debt market after many obstacles in providing reg-ulations and policies to form this market.It is known that the draft resolution consists of 18 articles, which will be effective with-in five years starting from July 1, 2017. The new draft resolution will influence on the entire existing bad debt as well as newly arising bad debts during the effective period of the Resolution. Some of the main contents of the resolution to be discussed include:Firstly are regulations on the sale of bad debts and collaterals at market price, the bad debt trading of bad debt purchase and settlement organisations, and the realisation of the right to seize collaterals.Secondly is to allow Vietnam Asset Management Company (VAMC) to buy bad debts that used off-balance sheet provisions and convert the bad debts that VAMC bought by special bonds (book value) to purchase under market value.Thirdly is to allow bad debt purchase and settlement organisations to sell bad debts to organisations or individuals.However, as per the assessment of HCM City Securities Corporation (HSC), the main obstacle to the sale of bad debt is the indrastic provisioning of banks.While most major banks will complete the process of putting provision for VAMC bonds by 2018, the provisioning progress of small banks is slower. Therefore, although the secondary debt market is likely to be established in the second half of this year, it will still take some time for this market to actually function.The resolution focuses on developing a framework for the secondary debt trading market, which had been discussed since the founding of VAMC but had little progress afterwards.


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HSC believes that the new resolution will help accelerate the secondary debt trading. However, secondary transaction can only take place when banks accounted bad debt following estimated value on secondary market. The major move in the bad debt set-tlement is still the provisioning pace of banks because in spite of internally accounting on the financial statements of banks, or having swapped to VAMC, bad debts are still owned by banks.In fact, banks have put provision quite seriously for the bad debts as well as nominal bad debts sold to VAMC and swapped into VAMC special bonds (20 percent was put provision for every five years). In 2016, the total provisions of eight listed banks (Viet-combank, Vietinbank, BIDV, SHB, Sacombank, Eximbank, MBBank and ACB) were about 27 trillion dong, up 13.5%, equal to about one percent of the total outstanding debt.Vietcombank was the only bank that completed the provisioning for VAMC bonds in 2016. Meanwhile, MBBank can be the second bank to complete its provision in this year. Prior to this, the bank planned to complete the settlement of VAMC bonds by the first six months of 2018.The bad debt settlement pace of banks is determined by the growth of operating profit. Last year, the pre-provision operating profit of eight listed banks grew 11.8 percent year-on-year to 59.26 trillion dong and the provisioning cost accounted for as much as 45.6%.However, some small-unlisted banks still find it difficult to make provisions. The prof-itability of these banks is thinner so it is difficult to maintain the provisioning. To ad-dress this situation, banks can only raise new capital.

How much do banks spend on information security?


At the recent Banking Vietnam 2017 meeting, representative of the Payment Depart-ment of the State Bank of Vietnam (SBV) said that in recent time, card frauds have be-come complicated and varied in many ways such as stealing customer information, phishing scams, installing malicious codes on devices such as phones and computers to steal account information and passwords, etc.In this situation, SBV has issued many regulations requesting banks to increase secu-rity in the payment system such as Circular 07, Circular 36, Circular 20, and most re-cently Circular 03.SBV's Payment Department representative said that to meet the legal requirements, banks are investing large amount of capital in network security and information secu-rity.In the recent time, banks have frequently warned their customer of the risks of infor-mation disclosure, the forms of frauds as well as service upgrades. In addition, banks have set up a mechanism for close exchange of information among banks. All of these solutions have been strengthened and effectively implemented.The representative analysed that in 2016, the total number of transactions via ATMs was 70 million, and via POS was nearly 100 million. Hence, the problem of losing mon-ey in customers' accounts in the recent time is not very worrying. Banks are still strengthening their security and enhancing quality to ensure as well as increasing cus-tomer confidence.Previously, in late 2016, at a seminar themed "Network security Your own issue", Ja-son Yuen deputy general manager in charge of network security at Ernst & Young Consulting Services Malaysia pointed out 10 lessons on information security that all banks face.According to Yuen, there will not be a reliable network. He cited that hackers recently attacked a Bangladesh bank and made use of the Swift software. Later, the attack on Swift software continued to be used for Vietnamese banks.Furthermore, anyone can become a hacker's target and no target is small. According to data from a survey by Verizon in 2015, most sectors have encountered information se-curity incidents, in which public service recorded the greatest number of incidents with 50 thousand cases, and it was 642 cases for financial sector.


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"The network frauds are increasingly recorded in Vietnamese banks. There are more and more people who click on the link and it is not always easy to be noticed. One of the popular scams is Phishing, in which hackers get information through a fake web-site of a bank", said Yuen.According to Kaspersky Lab's report on Spam and Phishing 2016, Vietnam ranked sec-ond in the origin of spams. Meanwhile, 23 percent of users would open fake emails and 11 percent would click on the attached files.Yuen shared that banks should consider security issue as a business risk. A bank which spends 20 million USD in the system is not necessarily safer than a bank that invests 10 million USD, if the investment is spread and not focused.Regarding the security of Vietnamese banks, the expert from Ernst & Young said that in general, the units are mainly in defensive status and often weak in the process of monitoring and responding to the incidents, and even weak in the investigation after the incidents.According to the advice of other security experts, banks and large enterprises using technology to do business should spend about 5-10 percent of their profit to reinvest in security in order to be safe against cyber-attacks which are on the rise.

VN proposes Apec initiative to facilitate e-commerce


Vietnam has proposed an initiative on building an e-commerce facilitation framework within the Asia-Pacific Economic Cooperation (Apec), as it is an important content in the 2017 Apec's agenda.According to the Ministry of Industry and Trade's E-commerce and Information Tech-nology Agency, trans-border e-commerce is seen as the fastest growing sector in world commerce. Over the past two decades, the global e-commerce value has been estimat-ed at $1.92 trillion.The Asia-Pacific region has recorded the largest transaction volume in the world, fol-lowed by West Europe and North America. E-commerce revenue from the business-to-consumer (B2C) model was $144 billion in Asia-Pacific last year, accounting for ap-proximately 35.9 per cent of the global B2C value. These figures are expected to rise to $467 billion and 47.9 per cent, respectively, by 2020.The Apec leaders have realised the significance of e-commerce in increasing the com-petitiveness of micro-, small- and medium-sized enterprises; in promoting sustainable growth; and in accelerating extensive and intensive regional economic connectivity.Against this backdrop, Vietnam has proposed an initiative on the building of an e-commerce facilitation framework, which focuses on five pillars.The pillars include: finalising and harmonising legal frameworks on e-commerce in Apec member economies; strengthening capacity-building to enable Apec economies to support micro-, small- and medium-sized enterprises to join the trans-border e-com-merce market in the region and around the world; promoting cross-border protection of individual data via the implementation of the Apec's current programmes; facilitat-ing non-paper trade in the region; and dealing with newly arising issues in cross-bor-der e-commerce.The e-commerce facilitation framework within the Apec is one of the highlights of the 2017 Apec. It is expected to contribute to facilitating trade and investment and become a driving force for the region's economic development.The Apec was established with the goal of promoting sustainable economic growth and prosperity in the Asia-Pacific region. The 2017 Apec Year is a pivotal event cele-brating 20 years of Vietnam's Apec membership.http://bizhub.vn/news/vn-proposes-apec-initiative-to-facilitate-e-commerce_286214.html

Conference helps exporters improve e-commerce


Vietnam eTrade Conference (VETC) was held on Tuesday by the Vietnam E-commerce Association (VECOM) in cooperation with the Vietnam Export Support Alliance (VE-SA) to help exporting firms and organisations improve their e-commerce activities.


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"This is the first event of its kind in Vietnam, which focuses on online export trends, the benefits of online exchanges and international retail trends," said Nguyen Ky Minh, deputy director of the E-commerce Development Centre under the Ministry of Industry and Trade (MoIT) at the conference.Multiple Vietnamese businesses are applying e-commerce technology in export, ac-cording to Tran Thanh Hai, deputy director of the MoIT's Import-Export Department. In fact, the number of Vietnamese enterprises participating in online export pro-grammes and training in online export skills in 2016 showed a 34 per cent increase from 2015, as reported by the VECOM in its 2017 e-Business Index.Hai also confirmed that in addition to accessing online public service such as e-cus-toms, online certificates of origin and other export-related services, businesses in Viet-nam have been using the internet to look for foreign trade partners and sign contracts online.E-commerce is considered an effective way to help business enhance efficiency in deal-ing with market research, contract signing, payment, customs regulations and bureau-cratic legislations.E-commerce is also believed to be a cost-cutting and time-saving solution to "unofficial fees" in the export process, according to VECOM's Chair Nguyen Thanh Hung.Meanwhile, the number of consumers buying directly from international retailers is rising rapidly, which further emphasizes the potential of e-commerce as a means to manage complicated import and export activities.The conference is not only a chance for businesses to learn about e-trade exchange and the trend of online retail to foreign customers, but also for them to propose that the State provide online public services for import and export, said Hung.The 2017 VETC was divided into three sessions focusing on the three main pillars of online export and import activities: online public services between government and business; export opportunities based on online exchange and the business to business model (B2B); B2B development trends aimed directly towards end consumers.This year's conference also marked VESA's introduction as a unit jointly created by OSB Investment and Technology Jsc, the Vietnam Prosperity Joint- Stock Bank, the Tel-ecommunication Joint Stock Insurance Corporation and the T&M Forwarding Ltd Business members of VESA are entitled to better support from this e-commerce, logis-tics and insurance trio.http://bizhub.vn/news/conference-helps-exporters-improve-e-commerce_286183.html

Banks recruited over 1,000 new employees in Q1


Commercial banks have consistently recruited thousand of new employees, especially for retail banking services, to meet business targets in 2017.According to reports from 13 banks, the personnel scale increased by 1,035 people in the first quarter.Nearly half of the total comprised VPBank's newly-recruited employees. Specifically, VPBank recruited 489 people, increasing the total number of employees until the end of the first quarter to nearly 10,000.VIB also newly recruited 316 employees, compared with 260 employees in ACB. The number of newly-recruited employees in Sacombank and Vietcombank was 215 and 190, respectively.Some banks, however, witnessed a decline in the number of employees, including BIDV and VietinBank.As of March 31, 2017, BIDV had 23,386 employees, down 218 people from the end of 2016. VietinBank's personnel scale, meanwhile, reduced nearly 100 people to 21,740.However, compared with the entire system at present, BIDV is still the bank with the largest personnel scale with 23,386 employees, followed by VietinBank and Sacom-bank with 21,740 and 16,243 employees, respectively.http://bizhub.vn/banking/banks-recruited-over-1000-new-employees-in-q1_286194.html


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AIA and HSBC form new bancassurance partnership

18/MAY/2017 INTELLASIA| VIR

On May 16, AIA (Vietnam) Life Insurance Co., Ltd (AIA Vietnam) and HSBC Bank (Vi-etnam) Ltd (HSBC Vietnam) announced a landmark bancassurance partnership that will deliver world-class services and greater value to customers in Vietnam, offering a diverse range of insurance and financial solutions.This partnership between HSBC Vietnam and AIA Vietnam will provide customers ac-cess to greater financial security in various stages of their life through a broad range of protection and long-term savings solutions, including universal life (all-in-one plan) and term life (life cover) insurance, education savings, as well as medical and critical illness cover policies.According to Pham Hong Hai, CEO of HSBC Vietnam, the country's robust economic growth in recent years has fuelled a fast-growing middle class and affluent population with evolving and diversified needs for protection and savings for education and re-tirement."By working with AIA, we aim to provide our customers with best-in-class insurance products and services that are critical to achieving their needs and aspirations for a bet-ter life quality," Hai said.Wayne Besant, CEO of AIA Vietnam, added that this partnership was a natural fit for both AIA and HSBC Vietnam."Customer experience and innovation are at the heart of everything our companies do and we are excited to bring our talents together to create even bolder and more inno-vative solutions to address the ever-changing needs of our customers," Besant said.These joint products will help customers deal with the twists and turns of life, whether it is buying a new home, preparing for higher education, planning for retirement or dealing with critical illness. This significant partnership offers customers a complete package of financial advice and tailor-made wealth and protection solutions based on understanding of individual customers' needs and financial situation.HSBC and AIA, with their combined expertise and strengths, intend to change the way consumers access and experience insurance and banking services, and lead the market with bold and innovative ideas.Both companies are leading innovators in their respective fields. HSBC offers stream-lined financial planning through its Personal Banking and unique Premier services at all HSBC outlets in the economic hubs across Vietnam. Besides over-the-counter serv-ices, HSBC has led the way in offering online services as a result of banking service dig-italisation, creating an excellent, 24-hour mobile and internet banking customer experience.AIA is known for innovative customer experience services, such as the Nest by AIA, the interactive Point of Sales system (iPOS), the MyPage customer Portal, the customer claim tracking system GBS, and especially the industry-leading customer healthy liv-ing programme AIA Vitality a carefully researched, science-backed wellness pro-gramme that equips customers with the knowledge, tools, and motivation to make a real change towards longer, healthier, and better lives.http://www.vir.com.vn/aia-and-hsbc-form-new-bancassurance-partnership.html

Vietinbank becomes settlement unit in derivatives market


The Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) has been made the exclusive financial institution to carry out settlements for derivatives trading transactions.At the cooperation agreement signing ceremony between the bank and Vietnam Secu-rities Depository on Monday, Vu Bang, chair of the State Securities Commission, said selecting Vietinbank as the settlement unit for the derivatives market was the right move.Vietinbank is a large financial institution in Vietnam, known for a broad trading net-work, high ratio of financial security, positive creditability and high quality of IT hu-man resources and facilities, Bang said.Vietinbank's subsidiaries such as Vietinbank Securities Company (VietinbankSc) and


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Vietinbank Fund Management Co Ltd will integrate deeper with the derivatives mar-ket as trading and clearing members, depending on the development progress of the market.To further carry out the strategic development plan for Vietnam's securities market in the 2011-20 period, the finance ministry asked the State Securities Commission, Viet-nam Securities Depository and Hanoi Stock Exchange to develop and conduct the de-velopment plan for Vietnam's derivatives market.The new market and products are expected to help Vietnam's securities market devel-op firmly, increase the scale and quality of the market, diversify products and services and gain access to international practices and standards.http://bizhub.vn/banking/vietinbank-becomes-settlement-unit-in-derivatives-market_286217.html

Central Bank approves BIDV bond issue of $900 million


The State Bank of Vietnam (SBV) recently allowed the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) to issue VND20 trillion (US$893 mil-lion) worth of bonds in 2017.BIDV's targeted demography includes both domestic and foreign organisations and individuals. Credit organisations, their subsidiary companies and foreign bank branches are not allowed to buy these bonds on the primary market.The yields will be decided by BIDV in accordance with market interest rates and the current set of bond yields regulations as dictated by the SBV.BIDV repurchased its shares in 2017 based on strict safety requirements, excluding tier two capital bonds, which require a different set of regulated legal documents.http://bizhub.vn/banking/central-bank-approves-bidv-bond-issue-of-900 million_286189.html

Apec 2017: Long-term infrastructure investment discussed


A seminar on Long-term Investment in Infrastructure took place in northern Ninh Binh province on May 17 on the sidelines of the Asia-Pacific Economic Cooperation (Apec) Senior Finance Officials' Meeting (SFOM) and Related Meetings.The event was co-held by the Ministry of Finance, the World Bank (WB), the Organi-sation for Economic Cooperation and Development (OECD), and the Asian Develop-ment Bank (ADB).The seminar gave attendees an overview of long-term investment in infrastructure in the Apec economies; Apec's infrastructure needs, financial capacity and roles of the private sectors; and proposals for infrastructure investment and outlined long-term changes in infrastructure investment of Apec member economies.The participants exchanged views on the Public-Private Partnership (PPP) as a feasible solution for infrastructure development projects in Apec and shared experience in at-tracting long-term funding for PPP development projects. They also discussed diver-sifying financing approaches for infrastructure and risk management instruments.The Apec Finance and Central Bank Deputies' Meeting (FCBDM) in February ap-proved an action plan to promote long-term investment in infrastructure this year.Accordingly, besides the seminar in Ninh Binh, Apec will coordinate with its interna-tional partners, such as OECD, WB, and ADB to share best practices in risk manage-ment in PPP projects and update on risk management instruments in certain fields. It will launch training courses for effective use of Source an online resource tool for managing PPP planning and procurement by the Sustainable Infrastructure Founda-tion (SIF).http://en.vietnamplus.vn/apec-2017-longterm-infrastructure-investment-discussed/111842.vnp

Apec ministers to seek clarity on trade in Hanoi


Trade ministers and officials from the 21 Apec member economies will meet in Hanoi to alleviate uncertainty about the future of trade in the Asia-Pacific and its capacity to


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boost employment and living standards for all people across the region.The Apec ministers Responsible for Trade Meeting on May 20-21 will cap off a pivotal set of policy development meetings here over the next 10 days to decide the next steps for trade amid rising skepticism about the benefits of globalisation and rapid social and technological change.Chaired by Vietnam Trade and Industry minister Tran Tuan Anh, the proceedings will build on initiatives introduced during technical exchanges between trade and sectoral officials to confront these challenges and fleshed out by Apec Senior Officials on May 17-18. This work will be shaped by new trade and growth projections for the Apec re-gion, which accounts for half of global trade, to be unveiled on May 17.Pacific Alliance, Regional Comprehensive Economic Partnership and Trans Pacific Partnership ministerial meetings are expected to be held on the margins of the Apec ministers Responsible for Trade Meeting in Hanoi."Momentum on market integration and trade is being tested in ways we have not seen since these forces transformed the Asia-Pacific into the engine of the world economy," said Dr Alan Bollard, Executive director of the Apec Secretariat."The shifting landscape is both a cause for consternation and an opportunity to work out and align new policy approaches to globalisation that could result in improved economic and social outcomes."By the same token, it is also prompting greater coordinated action to address concerns over market competition, worker dislocation and mounting inequality as the accumu-lation of wealth increases within economies, he addedMinisters and officials will focus on establishing freer Asia-Pacific trade that secures the advantages of globalisation while safeguarding the welfare of people hurt by it. This includes new collaborative efforts to facilitate high demand industries such as digital innovation, environmental services and food production, and address trade re-stricting measures that undermine their development and job creating potential.http://en.vietnamplus.vn/apec-ministers-to-seek-clarity-on-trade-in-hanoi/111829.vnp

SOM 2 discusses Apec priorities


The Apec 2017 Second Senior Officials Meeting (SOM2) in Hanoi has focused on dis-cussing Apec priorities adopted at the SOM1 held in Nha Trang city, the south central province of Khanh Hoa in March, according to Do Hong Viet, Assistant to the Apec 2017 SOM Chair.They include priorities on growth, regional connectivity, promoting micro, small and medium enterprises (MSMEs) as well as food security and sustainable agriculture de-velopment, he told reporters at a press briefing on May 17.In the May 17 morning session, the Apec senior officials heard reports submitted by the Economic Committee, the Committee on Trade and Investment, and the Apec Business Advisory Council (ABAC) Chair, he said.They paid much attention to debating how to continue supporting the multilateral trade system and help the World Trade Organisation speed up the realisation of agree-ments relating to the building of the Free Trade Area of the Asia-Pacific, he added.In the afternoon session, the officials plan to hear a report by the SOM Steering Com-mittee on Economic and Technical Cooperation and discuss other cooperation areas including some important initiatives proposed by Vietnam such as the action plan on promoting inclusive development in the financial, economic and social fields, and frameworks on boosting food security, rural and urban development.On May 18, the meeting will discuss the building of the post-2020 Apec Vision and consider recommendations of the Multi-Stakeholder Dialogue on Apec Toward 2020 and Beyond, Viet said.Up to 2,000 domestic and international delegates are taking part in SOM 2 and related meetings.SOM 2 comprises 49 meetings, workshops and dialogues of committees and working groups of the Asia-Pacific Economic Cooperation (Apec) Forum, covering a range of


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spheres such as trade and investment liberalisation, business facilitation, human re-source development, education, network economy, food safety, science, technology and creativity, mining, automobile industry and urbanisation.Apec now groups 21 member economies, including Australia, Brunei, Canada, Chile, China, Hong Kong (China), Indonesia, Japan, the Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Chinese Taipei, Thailand, the US and Vietnam.They together account for 39 percent of the world's population and contribute 59 per-cent of the global GDP and 48 percent of the global trade (by November 2016).Vietnam officially joined Apec in November 1998.http://english.vov.vn/economy/som-2-discusses-apec-priorities-349723.vov

Vietnam's inflation cooling gradually HSBC

18/MAY/2017 INTELLASIA| THE SAIGON TIMES

HSBC Bank said in a report that Vietnam's economic performance continues to be ro-bust with inflation easing gradually despite higher energy prices and increased costs of healthcare and education.Headline inflation eased further to 4.3 percent year-on-year in March from 4.6 percent previously. More than half the increase (2.9 percentage points) was contributed by the spike in health care services costs owing to the government's scheduled hike of medi-cal and educational service fees.On average, Brent prices were 1.4 percent higher in April from the previous month. However, gains in the transport component cooled to 11.1 percent year-on-year during the month from 14.6 percent in March.Meanwhile, core inflation eased to 1.5 percent year-on-year, from 1.6 percent previous-ly. Receding food inflation is keeping overall inflation in check, it said.According to the report titled "Vietnam at a glance Counting on numbers," Moody's rating agency changed the outlook on Vietnam's ratings to positive from stable. This is a welcome development on the back of robust data.The latest Purchasing managers' Index (PMI) survey showed overseas demand in April was the highest in recorded history, and that manufacturers remained strongly confident that output will increase over the coming 12 months thanks to expectations of higher new orders and business expansion plans.Vietnam has become an important node in the regionally dispersed supply chain for electronics, especially for mobile phones, which is the country's biggest export item. Interestingly, shipments of phones and spare parts recovered remarkably from the slump in March, just as it expected."Further, we think that new product launches and a gradual revival of global demand, which is reflected in the sustained increase in overseas orders in PMI surveys, will keep exports buoyant in the quarters to come," HSBC expected.Besides, the manufacturing sector is getting continued support from foreign invest-ment. Foreign direct investment (FDI) inflows have been steady and, as of April, 3.2 percent higher than those received in the same period of 2016.FDI helps build forex buffers and steer the economy towards higher value-added man-ufacturing. HSBC said the current macro-economic stability will help maintain a steady inflow of FDI in future.Elsewhere in the economy, inflation is gradually easing. Despite higher energy prices and increased costs of healthcare and education, muted food inflation is keeping a lid on overall prices.In sync with the sustained expansion in overseas order books, as was seen in recent PMI reports, exports grew by 16 percent year-on-year in April, while the previous reading was revised up to 14.3%. Earlier, it was reported to be 8%.Exports of the FDI sector rose sharply by 21.5 percent year-on-year from 13.1 percent previously, while the domestic sector posted growth of a mild 3.7%, down from 17.2 percent in March. Exports of phones and spare parts, the country's biggest export items, rebounded with a staggering 17.5 percent rise following a 13.3 percent decline in the previous month.


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However, other important exports, like textiles and footwear, slowed during the month. Meanwhile, import growth slowed but remained strong at 23.8 percent year-on-year in March, narrowing the trade deficit.http://english.thesaigontimes.vn/53983/-Vietnam%E2%80%99s-inflation-cooling-gradually---HSBC.html

State budget faces deficit as fuel import tax cut down


Special consumption tax must be adjusted to avoid a serious budget deficit when fuel import tax is cut in line with various trade agreements Vietnam has signed, President of the Vietnam Petroleum Association Phan The Rue has said.Currently, income from fuel import tax accounts for 7 percent of the State budget, he said at a conference in Hanoi on May 16.Rue said that in order to ensure harmony of State budget income, agencies should care-fully calculate a roadmap for raising other taxes.According to the association, fees and taxes make up more than 50 percent of the fuel price. Therefore, cutting fuel import tax to zero percent necessitates increasing other taxes to make up for the lost income.http://en.vietnamplus.vn/state-budget-faces-deficit-as-fuel-import-tax-cut-down/111851.vnp

Vietnam's fuel association calls for tax hikes as zero import duty nears

18/MAY/2017 INTELLASIA| TUOITRE NEWS

The Vietnam Petroleum Association has proposed various measures, including in-creasing several domestic taxes, to help protect the petroleum sector once import du-ties on fuel products are gradually reduced to zero.Phan The Rue, the association's chair, believes taxes should always account for at least 50 percent of the retail fuel price to ensure state revenue, a stance that has sparked pro-tests from local consumers."It is essential to levy higher domestic taxes on fuel to make up for the losses to the state budget caused by reduced import duties," Rue, a former deputy minister of trade, said at a conference in Hanoi on Tuesday.According to trade accords Vietnam has joined, import duty on fuel will be zeroed by 2024, with Rue urging that the country start increasing environmental protection, do-mestic consumption and value-added taxes on fuel as early as 2018."Once the import duty is cut to zero, we should increase other taxes to make up for the loss," Rue said.The Vietnam Petroleum Association chair said that higher taxes will not affect retail fuel prices, given the reduced import tariff.He suggested that consumers should not be opposed to any tax increases, because "paying higher taxes is how every citizen shows their responsibility to the country."Vietnam's Ministry of Finance is drafting a bill suggesting a lift on the maximum al-lowed environmental protection tax on gasoline to VND8,000 per litre from the current VND3,000.A92 gasoline, the country's most widely used fuel, currently sells for VND17,310 a litre including the VND3,000 per litre environment tax. Should the new tax rate be applied, the price would rise to more than VND22,000 a litre, according to analysts.At Tuesday's conference, Rue reiterated his support for an VND8,000 tax cap, urging a roadmap be prepared to begin applying a new tax framework.In response, Truong Dinh Tuyen, a former minister of trade, said increasing taxes was not a proper solution."What's more important is to create a competitive fuel market that provides the best retail prices for consumers," Tuyen said."In reality, we currently have 29 fuel wholesalers, but some of them hold market share of more than 30 percent."Tuyen said increasing taxes may help reduce losses to the state revenue, but it's not a sustainable solution."We should try instead to cut taxes and help local businesses reduce input cost, which


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helps boost their performance," Tuyen elaborated."Healthy businesses will achieve bigger incomes, which are a stable and sustainable source of revenue for the state coffers."http://tuoitrenews.vn/business/41033/vietnams-fuel-association-calls-for-tax-hikes-as-zero-import-duty-nears

EVFTA to boost IP development: expert


The EU-Vietnam Free Trade Agreement (EVFTA) will help Vietnam become the re-gional hub for many foreign manufacturing companies, promoting the development of industrial parks (IPs) in the country, said Gellert Horvath, vice chair of the European Chamber of Commerce (Eurocham).According to Gellert the EU is currently Vietnam's second largest export market and Vietnam is the EU's 11th largest source of imports. About 900 European enterprises have invested in Vietnam the highest in Southeast Asia.The EU's total registered capital till December 2016 reached $21.5 billion. In the first quarter of the year, it reached $96.29 million.EU companies have invested in 18 sectors, focusing on manufacturing and processing (34.7 per cent), power distribution (14.8 per cent) and real estate trading (11.9 per cent).He said that Vietnam had the advantages of having favourable political and geograph-ical location in comparison to other countries in the region, such as Indonesia, Malay-sia and Thailand. In addition, the government made efforts in its international integration process.He added that Vietnam was a great location for EU manufacturers to export their goods to Asian countries. Its industrial park network was therefore expected to grow strongly over the next few years.According to Nguyen Noi, deputy head of the Foreign Investment Agency under the Ministry of Planning and Investment, Vietnam has 324 IPs, 16 seaside economic zones and three hi-tech parks. The government is set to increase the number of hi-tech parks to six by 2030, while developing three special economic zones in Van Don, Cam Ranh and Phu Quoc.Noi said Vietnam had signed 66 Bilateral Investment Promotion and Protection Agree-ments (BIPA). The country would have free trade relationships with 55 partners and 15 members of G20, which accounts for three-fourth of the world's GDP.He explained that the investment inflow into Vietnam, especially garment and textile, leather shoes, wooden furniture, electronics and information and technology would increase thanks to deep integration and zero export taxes.The country's northern region has the advantages of abundant labourers, big market and improved infrastructure, and more particularly, integrated IPs system and high tenant rate, according to Noi.The region has been the country's biggest industrial manufacturing hub, with the es-tablishment of a supply chain in the electronics sector from companies such as Sam-sung, LG, Canon and Kyocera and automobile makers including, Toyota, Honda, Hyundai and Ford, since 2008.Victor Lim, deputy director of Vietnam Singapore Industrial Park (VSIP) Bac Ninh, said that they planned to build a smart city near the IP called the VSIP Bac Ninh Town-ship Development Master Plan, which is a combination of manufacturing and residen-tial.The move was taken by many IPs to boost investment in infrastructure and welcome more foreign manufacturers into Vietnam.The master plan includes many categories, such as a sports hub, a golf driving range, the Belhomes landed housing project, a business hub cluster and park, a wet market, a shopping mall, a hotel, mid-end landed properties, a school complex, and worker housing. He noted that many of these were calling for investment.Horvath said Vietnam should develop the complex model in the future.Chua Ah Lay, Chair and CEO of Santomas Vietnam, which has been in Vietnam for nearly 20 years, said his company was providing transport for workers from neigh-


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bouring towns to IPs."If there was workplace accommodation next to the IP, it would be very good for us," he said.Over the last two decades, VSIP has become one of the largest developers of integrated IPs and complexes in Vietnam. It has operations in the southern, northern and central economic zones of Binh Duong, Bac Ninh, Hai Phong, Quang Ngai, Hai Duong, and Nghe An.VSIP has about 690 companies from 30 economies, attracting an investment capital of $9.1 billion and generating about 180,000 jobs from operating tenants.VSIP was established in 1996 based on mutual cooperation and support between the two governments of Vietnam and Singapore.http://bizhub.vn/news/evfta-to-boost-ip-development-expert_286182.html

Vietnam proposes four initiatives to boost Apec financial cooperation


An official of the Ministry of Finance has detailed four financial cooperation initiatives proposed by Vietnam in the Apec Year 2017, ahead of the Senior Finance Officials' Meeting slated for May 18-19 in Ninh Binh province.Vu Nhu Thang, director of the ministry's Department of International Cooperation, told Vietnam News Agency that the four initiatives relate to finance for infrastructure, base erosion and profit shifting (BEPS), disaster risk finance and insurance, and com-prehensive finance.They are associated with the national prioritised pillars in 2017, when Vietnam hosts Apec events.He elaborated that the initiative on long-term investment in infrastructure aims to em-phasize the role of financial mechanisms, especially the risk sharing mechanism, in building infrastructure projects through feasible public-private partnership (PPP). Meanwhile, Vietnam and other developing economies have growing demand for in-frastructure development and the private sector's engagement in those projects.The anti-BEPS cooperation initiative is meant to boost the sharing of experience and improve the capacity of Apec's developing economies so as to carry out the OECD's BEPS action plan.It is a fact that BEPS is a global issue that needs an overall solution based on multilat-eral cooperation, while the current prevention of BEPS through unilateral and bilateral measures is unfeasible due to the rising number of major multilateral companies with increasingly complex transactions, Thang said.The discussion of BEPS minimum standards at Apec meetings will allow Vietnam and other developing economies to learn from the experience of policy makers and experts of developed economies in applying policy tools and receive direct technical assist-ance, he added.In the initiative on disaster risk finance and insurance, the focus is on the exchange of experience in making financial and insurance solutions in response to disaster risks.This topic is put on the table with a view to helping promote Apec economies' resil-ience and response to disaster risks, improve their capacity of solving disaster conse-quences, and reduce the burden of budget spending and risks to public asset.Thang noted the comprehensive finance initiative looks to discuss and share experi-ence in finance for agriculture and rural areas.Micro-finance hasn't truly developed in most of developing economies, he said, add-ing that access to financial products still faces obstacles since the price and design of micro-financial products have yet to meet low-income earners' diverse demand.Therefore, Apec will work to devise solutions facilitating the access to financial serv-ices in agriculture and rural areas, the official said.http://en.vietnamplus.vn/vietnam-proposes-four-initiatives-to-enhance-apec-finan-cial-cooperation/111853.vnp

Vietnam among Asia's growth leaders


In a recent article, New York-based media firm Bloomberg has cited IMF outlook that


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Southeast Asia, including Vietnam, is taking over as the region's growth leader.According to the outlook, expansion of the Asean 5, consisting of Vietnam, Indonesia, Malaysia, the Philippines and Thailand will exceed 5 percent through 2022.Aging will clip the potential growth rates of all major North Asian economies in com-ing years, while those of Southeast Asian ones may accelerate, with the exception of Singapore's, Nomura Holdings Inc. said.Infrastructure spending by the 10-member Association of Southeast Asian Nations will average $110 billion a year through 2025, according to Ernst & Young LLP.Countries in Southeast Asia are also ramping up on ambitious large-scale infrastruc-ture projects.The region's strong growth outlook is luring companies such as Coca-Cola Co., which is expanding in Vietnam and in Myanmar. Heineken NV is competing with Anheuser-Busch InBev NV, Asahi Group Holdings Ltd and Kirin Holdings Co. for a stake in Vi-etnam's largest brewer SaiGon Beverages Joint-Stock Company.http://en.vietnamplus.vn/vietnam-among-asias-growth-leaders/111873.vnp

FDI's link to growth disparity


In Vietnam, the localities attracting greater foreign direct investment have generally reached higher development levels than their counterparts, a situation which has led to uneven development among regions. If countermeasures are not introduced now, the development gap could grow, which will have repercussions on national develop-ment overall. Senior economist Nguyen Mai delves into the problem.A developmental discrepancyBinh Duong and Binh Phuoc are two southern provinces which were formed after the splitting of Song Be province two decades ago. Binh Duong has been one of the most successful localities nationwide in attracting foreign direct investment (FDI), resulting in robust socio-economic development. Meanwhile, Binh Phuoc's development has mainly been leveraged on domestic investment sources.In 1997, Binh Duong was home to only six industrial parks (IPs), covering 800 hectares. It now hosts 29 IPs and eight industrial clusters, spanning over 10,000ha. Binh Duong's Vietnam-Singapore Industrial Park is now regarded as one of the most successful IPs for the entire country.Along with modernising industrial production, Binh Duong has focused on urban de-velopment and skilled human resources training to improve the local investment cli-mate. By then end of 2016, the province attracted $25 billion in committed FDI and nearly VND200 trillion ($9.09 billion) in domestic investment. Binh Duong has contin-ually been listed among the top performers in luring FDI, reporting an annual average economic growth rate surpassing 14.5 per cent. The production value of its diverse eco-nomic sectors has increased quickly, parallel to a positive transformation of the local economic structure.Binh Duong is deploying a smart city model, coupled with modern architectural plan-ning, to satisfy local residents and visitors' ever-growing expectations.Binh Phuoc's progress has lagged behind its sister province. Mostly because it doesn't enjoy the favourable geographic conditions of Binh Duong, so it is less enticing for for-eign investors. As of 2016, the province garnered only $1.25 billion in total committed FDI.From 2010 through to the present, Binh Phuoc has applied a raft of measures to better the investment environment, which resulted in an average economic growth rate of 10.8 per cent during the 2011-2015 period. Its per-capita gross regional domestic prod-uct (GRDP) rose from VND24 million ($1,090) to VND42.8 million ($1,945) during the same period.Binh Phuoc's GRDP was about 6 per cent of Binh Duong's, and its budget contribution was 8 per cent of Binh Duong's. Binh Duong is considered to be among the top locali-ties in terms of contributions to the central budget, while Binh Phuoc still receives state subsidies.A similar situation is observed in Phu Tho and Vinh Phuc, two provinces which were


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formed from the splitting of Vinh Phu province two decades ago.Since its re-establishment, Vinh Phuc has effectively made use of its advantages most importantly, its proximity to Hanoi and to Noi Bai International Airport to attract FDI into large-scale projects.From 1997 to 2016, the province posted an average annual growth rate of 15.3 per cent. In 2016, its GRDP stood at VND77.2 trillion ($3.5 billion). Its industrial production val-ue rose tremendously from VND1.65 trillion ($75 million) in 1997 to VND125.2 trillion ($5.7 billion) in 2016.Meanwhile, Phu Tho managed an average annual growth rate of 8.69 per cent. In 2016, the province contributed VND4.4 trillion to state coffers, 14 times as much as in 1997. Per capita average incomes rose 14.5 times against 1997 to VND33.2 million ($1,510) in 2016.The development level of Phu Tho, however, pales in comparison to Vinh Phuc. Vinh Phuc's per capita GRDP was 2.17 times higher, and its budget contribution was 6.47 times greater than Phu Tho's.Uneven contributionsIn the 2016 state budget estimate, only 13 out of the 63 eligible cities and provinces made contributions to the central budget. The contributors were Hanoi, Hai Phong, Quang Ninh, Vinh Phuc, Bac Ninh, Danang, Quang Ngai, Khanh Hoa, HCM City, Dong Nai, Binh Duong, Ba Ria-Vung Tau, and Can Tho.These localities take the lead nationwide in attracting FDI. Localities such as Thai Nguyen, Thanh Hoa, Quang Nam, and Ha Tinh might join these ranks soon by virtue of large-scale FDI projects being underway.Of the total 2016 state budget revenue of more than VND998 trillion ($45.4 billion), 14 northern highland localities contributed 3.6 per cent; 13 cities and provinces and in the Mekong Delta provided over 4.5 per cent; 14 localities in the north-central and central coastal regions nearly 11 per cent; and five provinces in the Central Highlands provid-ed nearly 1.4 per cent.The figures are evidence of the uneven development across the country's different re-gions. The places luring vast volumes of FDI and domestic investment capital have grown vigorously, boasting modern industries and accelerated urbanisation.Meanwhile, other localities remain less developed, mainly capitalising on agricultural production and the exploitation of natural resources.To address this uneven development, there needs to be an adequate approach in tax collection from localities, as well as a contribution to the central budget of cities and provinces.In the national development strategy, gradually raising the number of localities mak-ing contributions to state coffers must be taken as an important target of each locality and the whole country.Ensuring even development among the regionsInvestment and development has a causal effect: for underdeveloped regions to achieve more robust growth, they must attract more investment capital into major in-vestment projects.FDI comes from private sources, and despite the presence of high investment incen-tives, it is not easy to encourage foreign investors to carry out projects in areas with unfavourable development prospects. These underprivileged areas must first focus on attracting domestic investment, when they reach a higher development level with bet-ter social and technical infrastructure, they will then be able to lure greater FDI.The growth strategy of less-developed localities must leverage the synergy of the four following factors:First, these localities must realise their distinct advantages and potential, and present specific investment incentive regimes within a cohesive regulatory system to attract major investment groups to carry out projects in their areas. They should work on building transport infrastructure, power, water, communications networks, industrial zones, resorts, and urban areas. These projects will help improve their image and at-tract FDI.


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Second, it is important to increase cooperation among the cities and provinces in each region, to make use of their distinct advantages bolstering development.Third, major state groups and organisations in the fields of power, telecommunica-tions, transport, education, training, and healthcare must proportionally distribute public investment capital. They should also encourage diverse investment sources to build important technical and social infrastructure in these underdeveloped localities. Regions with higher levels of development such as Hanoi and HCM City need to ex-pand cooperation with less-developed localities to help advance their growth.Fourth, the government should consider narrowing the gap in development among re-gions as an important target for sustainable development, setting targets and review-ing implementation results for each stage. Following this, distributing public funds and offering incentives for projects in these underprivileged areas will be important to these less developed regions' growth.http://www.vir.com.vn/fdis-link-to-growth-disparity.html

Rice exports expected to face tough competition

18/MAY/2017 INTELLASIA| VIETNAMNET

The Vietnam Food Association (VFA) has warned that it would be difficult to export rice in 2017.The inventory volume has reached nearly 1 million tonnes. Not only Vietnam, but Thailand also has millions of tonnes of rice in excess. The latter plans to sell eight mil-lion tonnes in stockpile. This means that Vietnam would have to compete with Thai-land to sell rice.Nguyen Van Don, director of Viet Hung Company in Tien Giang said it is even more difficult to export rice in 2017 than the last year. The company still had not signed any export contract by the end of March. It now just gathers strength to deliver rice under contracts signed in 2016."The market is unpredictable. However, it would be very difficult to find buyers this year. While the supply is profuse, Vietnam's loyal markets such as the Philippines and Indonesia now can feed themselves, while other markets have tightened control over the import quality," he said.Le Thanh Khiem, deputy director of the Tien Giang Food Company, said there are la-tent difficulties in 2017 and upcoming years because of oversupply, while the market will be the buyers' market.Meanwhile, an analyst said China would continue controlling the Vietnamese rice market this year.This means that any fluctuations of the Chinese market would affect the home market. Vietnam has been warned it would face even bigger difficulties as the Chinese market is no longer easy to please.The bad news has come that the President of the Philippines has announced the coun-try has halted the import of rice to protect local production.VFA's chair Huynh The Nang said not only the Philippines, but other SE Asian mar-kets have gradually changed the rice import mechanism. It is not the governments, but private businesses which will come forward and import rice.Growing rice not a solution for Vietnam"Why does Vietnam still want to grow rice, if rice can't sell well and the profit from rice is not high?" asked Vo Tong Xuan, an expert in agriculture.He believes that it would be better to reduce the cultivation of rice and shift to grow other crops which bring more money.Mentioning the 1 million tonnes in stockpile, Xuan said it is necessary to reconsider rice production scale in 2017.Vu Van Liet from the Vietnam Agriculture Academy said the state needs to help en-terprises boost exports to African countries to clear the stocks, because the countries have the same requirements for rice quality as China.http://english.vietnamnet.vn/fms/business/178355/rice-exports-expected-to-face-tough-competition.html


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Vietnam warned about cement oversupply, narrower export markets


As the domestic cement supply has exceeded demand, exporting products is the only solution for cement manufacturers.According to the Vietnam Cement Association (VNCA), the total designed cement ca-pacity reached 88 million tonnes by 2016.If counting the plants under construction and put into operation by 2018 and the one being upgraded, the real production capacity may reach 120-130 million tonnes by 2020.Meanwhile, the cement consumption in the domestic market is estimated at 82 million only by 2020, which means the excess of 36-47 million tonnes.Also according to VNCA, the domestic demand was 60 million in 2016, and the figure would increase by 5-6 million each year from now to 2020, i.e. the demand would be 80-82 million tonnes by 2020.As such, the overabundance may begin in 2017 and the competition for domestic con-sumption will continue increasing.Luong Duc Long, director of the Building Material Institute under the Ministry of Con-struction (MOC), confirmed that the supply is higher than the demand right now.Meanwhile, five more cement plants are under construction and will become opera-tional from now to 2020, which will provide 12.7 million tonnes a year more. The total cement output is expected to reach 101 million tonnes a year in the future."Agencies predicted that domestic demand would reach 95 million tonnes by that time. However, I think the figure would not be so high," he said, adding that only 60 million tonnes were consumed last year and the demand would not soar so rapidly in the next four years.Long said the cement oversupply has taken place already, but this still has not caused big consequences because manufacturers can sell cement abroad. However, he warned that exporting cement would be not an easy job in the future.According to the general Department of Customs (GDC), in the first quarter of 2017, Vietnam exported 4.8 million tonnes of cement, an increase of 10 percent in quantity and 5.9 percent in value compared with the first quarter of 2016.Cement is exported to 10 markets, mostly to the Philippines and Bangladesh, which consume 67.5 percent of total cement and clinker exports.An official of VNCA said Vietnam was once listed among the world's biggest cement exporters (20 million tonnes).However, the export has been slowing down after 2014. Vietnam could only export 16.2 million tonnes in 2015, down by 18 percent from 2014. Meanwhile, the exports of cement and clinker in 2016 were lower by 2 percent than 2015.Not only export volume, but the export price is also on the decrease because of com-petition from China, India and some other countries.http://english.vietnamnet.vn/fms/business/178347/vietnam-warned-about-cement-oversupply--narrower-export-markets.html

Are private businesses in Vietnam private ones?

18/MAY/2017 INTELLASIA| NHIP CAU DAU TU

The title of the richest people on the stock exchange has not fallen out of the hand of Doan Nguyen Duc Chair of Hoang Anh Gia Lai Group. However, the existing difficul-ties of this business have pointed out some remarkable points in the development of private businesses in Vietnam.Over the past few years, the richest Vietnamese people named in the list of the world millionaires, billionaires are considered as happy signals. Private businesses have proved their position and achievements, in contrast to the sluggishness and loss of State-owned enterprises (SOEs). However, Bui Ngoc Son, Head of International Eco-nomic Research, Institute of World Economics and Politics, asked, "How many private businesses that have created a strong market position are really private ones?"For example, as per Son, when the state completes its capital withdrawal, returning to the true meaning of private businesses, many of today's largest private companies are likely to face some difficulties. In order to promote the private sector, the government


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stepped up the divestment from a large number of state-owned enterprises (SOEs) such as Habeco, Sabeco and Vinamilk. However, a parallel issue is to review the model of the State Capital Investment Corporation (SCIC). Accordingly, the top priority should be given to the objective of business efficiency, the elimination of administra-tive mechanism and the application of good governance practices of the world. Son points to the fact that many Vietnamese private businesses are growing up by ex-ploiting the advantages of natural resources such as forests, minerals, land, etc. The gaps and imperfections in the management mechanism have created opportunities for these companies to get rich quickly. The downside here is that when the underlying resource is exhausted, land fevers are over, businesses will have to face real market challenges while the integration management platform is not similar to the magnitude of businesses.The third thing that Bui Ngoc Son pointed out is that Vietnam has not had many large private firms in the manufacturing sector. Although FPT is assumed as a wholly pri-vate business, the achievements of this company still seem to be very modest. Bui Ngoc Son, a prominent economist, said: "FPT only developed at the beginning. So far, it has not had much growth in software sector. In the field of phone manufacturing, FPT products are difficult to compete because they are not active in accessories and components. "This shows the defects in the development structure. On the other hand, it shows the weakness of Vietnamese businesses and the extremely difficult challenges to overcome towards the world industrial revolution.Let's go back to the question, "Are private businesses really private ones? It would be normal if businesses receive incentives from regulators when they have demonstrated their capacity and influence on the economy. However, if the special support only comes to a few businesses before the official operation, the opportunities of other busi-nesses will no longer exist.As per the analysis of Vietnam Chamber of Commerce and Industry (VCCI), in 2009-2011, businesses that wanted to create one dong profit had to pay 0.7-1 dong of unof-ficial costs.The investment structure of the private economic sector from 2000 to present shows that there are not many breakthroughs. The investment proportion of private sector was only 39%, slightly higher than the previous levels. This shows that there is no growth of the private business sector as it was expected to become the main driver of Vietnam's economic growth. Of the 500 largest businesses in Vietnam, the number of corporations is very few, the scale is small, the operation sectors are limited, especially the level of technology and governance is different from other countries. Except for SOEs, there are not many companies like Vingroup, Hoa Phat, TH True Milk, Masan, Truong Hai.As per the assessment of the Central Economic Commission, the total turnover of pri-vate businesses from 2007 to 2015 increased sharply by 4.4 times, from 3,500 trillion dong in 2007 to 15,500 trillion dong in 2015. Major cities such as HCM City have set the target to build a team of competitive businesses with sustainable growth rate, and at least 500,000 businesses, of which large scale businesses and the private sector will contribute about 65 percent of GDP and 64 percent to the total social investment.However, "it is not determined whether it is large compared to whom and how large it is. Meanwhile, also as per the Central Economic Commission, the ratio of loss-mak-ing and bankrupt businesses is still quite high, averaging at 45 percent in the period of 2007-2015. The structure of industries remains unreasonable, 81 percent focuses on trade and services while only one percent invests in agriculture. The number of busi-nesses in manufacturing, processing sector is very small.Many economic experts have affirmed that, firstly there must remove the specific dif-ficulties of Vietnamese businesses, in line with the anti-corruption policy and determi-nation of the management levels from the central to local levels.At the same time, there needs to take professional steps, like the relatively healthy de-veloped economies in the world. Economist Bui Kien Thanh said that private business-es could only have internal resources when they are supported in knowledge of


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products, markets, knowledge of human resources management and production. In particular, there needs to provide credit to businesses with reasonable interest rates, equivalent or not much different than the interest rates in other regional countries.In the US, the Small Business Administration supports small and medium businesses from project development to start-up, develop and grow. The commercial banking system has associated with businesses since their inception. The advantage of banks is they always update new information on market, technology, financial management, human resources... along with the need to find business customers to lend. Therefore, businesses will be helped to build and perfect business plans from time to time and provide enough funding for those goals. In return, if businesses develop well, banks will gain good and stable returns from their lending activities.Market development centre models such as Jetro (Japan) and Kotra (Korea) are also good suggestions to help businesses develop the market, especially foreign ones. These are government-run centers that are responsible for promoting foreign trade and foreign investment, supporting the external economic activity of small and medi-um enterprises (SMEs) by economic, culture, education measures.The most important thing, according to Bui Kien Thanh, is that we cannot let business-es to have to borrow at such high interest rates as in the previous period. If we cannot access credit sources at reasonable interest rates and are inferior in technology and market accessibility, Vietnamese businesses cannot create competitive products with those of the same kind in foreign countries.As per sideline information, the above suggestions, especially the problem of credit ac-cess of businesses was proposed by Bui Kien Thanh from the 90s of the twentieth cen-tury when the expert returned to Vietnam, wishing to contribute to the revitalisation of the economy. Having been more than 80, he continues to give feedbacks to anyone who wants to listen and hopes to change something

Economists warn of Vietnam's growing trade deficit towards Korea


The Republic of Korea has surpassed China, becoming Vietnam's biggest import mar-ket.According to statistics recently released by the Ministry of Planning and Investment, in the first four months of this year, Vietnam's trade deficit towards China totalled at $9 billion, while it was $9.3 billion towards Korea.Hence, the Republic of Korea (ROK) is the new champion trading partner of Vietnam, taking over China, despite the fact that the largest portion of Vietnamese imports is still sourced from the latter.Specifically, in the first four months of the year, Vietnam imported $17.6 billion worth of products from China, an increase of 19.4 per cent, while the import turnover from ROK was $13.7 billion, up 45.3 per cent in comparison with the same period last year.In fact, warnings about Vietnam's growing trade deficit towards ROK have been soud-ing for about a dozen years now, probably since Samsung started investing a large amount in manufacturing complexes in Vietnam.In 2008, Vietnam's trade deficit with ROK was $6.27 billion. This figure increased to $8.46 billion in 2011, to reach $20.6 billion in 2016. In the first four months of this year, Vietnam's trade deficit towards ROK reached $9.3 billion, not breaking the monoto-nously increasing trend.For years, the public opinion seemed to be sharply focused on China instead of ROK. However, since ROK unexpectedly surpasses China in trade deficit, economists have been warning to exercise caution.It is not too difficult to explain why the trade deficit to ROK has been soaring. After Samsung started making large investments in manufacturing complexes in the coun-try, the wave of investment from ROK has been increasing strongly.As of April 2017, ROK accumulative investment capital was over $54 billion, topping off the list of countries and territories investing in Vietnam, going far beyond rank two Japan's $10 billion. ROK enterprises have been investing heavily in Vietnam, bringing about a demand to import machinery, equipment, and materials.


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Vietnam Export-Import Report 2016, published by the Ministry of Industry and Trade, also mentioned this issue.According to deputy minister of Industry and Trade Tran Quoc Khanh, Vietnam's main imports from ROK serve the purposes of manufacturing, processing, and export-ing products.Only in 2016, the total import turnover from South Korea was $32 billion, up 15.9 per cent on-year. Many trade items saw increases at a similar pace.Looking for solutionsThe large trade deficit towards ROK is not an overly large concern because Vietnam's main imports focus on materials and equipment serving production, business, and in-vestment. However, an over-large trade deficit may have unhealthy implications.During the meeting with the minister of Foreign Affairs of the Republic of Korea Yun Byung-se in March 2017, Pham Binh Minh, deputy prime minister and minister of For-eign Affairs, suggested that the South Korean government take effective measures to gradually balance trade and reduce Vietnam's trade deficit, as well as facilitate the im-port of Vietnamese agricultural, forestry, and fishery products into ROK.The two-way trade between Vietnam and ROK grew dramatically since large ROK corporations have been flocking to invest in Vietnam, especially after the Vietnam-Ko-rea Free Trade Agreement (VKFTA) came into effect.However, the growth rate of ROK imports from Vietnam failed to meet expectations, as many Vietnamese export products have yet to properly penetrate the ROK market.For example, among the countries entering into free trade agreements with ROK, Vi-etnam is the first partner that can access the market for highly sensitive products, such as garlic, ginger, honey, and sweet potatoes.However, it is difficult to export these items massively because the Sanitary and Phy-tosanitary Measures (SPS Agreement) adopted by ROK and applicable to fresh fruits, are impeding Vietnamese goods.Removing the difficulties related to the SPS is essential for Vietnam to boost exports to ROK.However, according to economists, in order to reduce the trade deficit towards ROK, it is important that Vietnam restructure the economy and develop supporting indus-tries.If the dependency on imported materials persists, the trade balance between Vietnam and ROK will grow to significant proportions.http://english.vietnamnet.vn/fms/business/178520/economists-warn-of-vietnam-s-growing-trade-deficit-towards-south-korea.html

China emerges as Vietnam's largest fragrant rice importer


China, already the largest importer of Vietnam's sticky rice, has emerged as the biggest buyer of Vietnamese fragrant rice, according to exporters.Last month Vietnam exported over 140,000 tonnes of fragrant rice, with 36 percent of it going to the Chinese market, which made China the largest importer of this kind of grain.Ivory Coast and Ghana were the second and third largest importers of Vietnamese fra-grant rice last month with each buying about 30,000 tonnes. Singapore and Malaysia were also among the top fragrant rice markets of Vietnam in April but their import vol-umes were insignificant.The country's total fragrant rice exports in January-April amounted to over 355,000 tonnes, with China alone accounting for a staggering 46%. Ivory Coast, Ghana, Malay-sia and Singapore were also major importers of Vietnamese fragrant rice in the first four months of the year.China is also known as Vietnam's largest glutinous rice importer. Last year glutinous rice shipments to China amounted to over 940,000 tonnes, accounting for over 90 per-cent of the total.According to data of the Vietnam Food Association (VFA), although Vietnamese rice exports to China in 2016 inched down against the previous year, the northern neigh-


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bour remained Vietnam's largest rice importer.Last year saw rice exports to China amounting to 1.8 million tonnes, representing near-ly 37 percent of the nation's total but dipping nearly 20 percent compared to 2015.A Ministry of Agriculture and Rural Development report said Vietnam's January-April rice exports reached over 1.8 million tonnes, with China accounting for over 40%.http://english.thesaigontimes.vn/53992/China-emerges-as-Vietnam%E2%80%99s-largest-fragrant-rice-importer.html

Japan becomes largest importer of VN's shrimps


Japan has become the largest market for Vietnamese shrimps, accounting for 21.9 per cent of the country's shrimp export value in the first quarter of 2017.The Vietnam Association of Seafood Exporters and Producers (VASEP) reported that in the first three months of this year, Vietnam's shrimp exports to Japan reached $135.4 million, a year-on-year increase of 29.6 per cent. The significant growth is because of the rise of the yen, which has encouraged Japanese enterprises to move to imported shrimp.Also, Japanese consumers tend to switch to cheaper seafood, which has increased the demand for shrimp as they are more affordable than other seafood such as tuna, salm-on and squid.In the high-end market segment, the demand for giant tiger prawns and shrimps with head on is also rising.Earlier this year, the average price of Vietnamese shrimp exported to Japan was $12 per kilo, while Indonesia's rate was $11 and Thailand's $10.Although Vietnam's average price is higher than that of competitors in the region, ex-ports to Japan saw significant growth, higher than both Thailand (13.9 per cent) and Indonesia (2.4 per cent).The VASEP said that in the first quarter of 2017, Vietnam exported shrimp to 68 mar-kets. The top 10 markets include Japan, EU, US, China, South Korea, Canada, Austral-ia, Asean, Taiwan and Switzerland, which together account for 95.4 per cent of Vietnam's shrimp exports.There is a change in the position of the top 10 shrimp importers, with Japan replacing the US to become the largest importer, the EU holding its previous position at No 2, and the US taking the third position.http://bizhub.vn/news/japan-becomes-largest-importer-of-vns-shrimps_286211.html

Deputy PM puts emphasis on expressway project


Specific policies and mechanisms are needed to draw investment and hasten the progress of the North-South Expressway. However, they must be conducted in an open and transparent manner, said deputy prime minister Truong Hoa Binh at a recent meeting on the project.The North-South Expressway is an important national project, which needs govern-ment approval before submission to the Politburo and National Assembly, he said.The deputy PM asked the State appraisal council to promptly appraise the project and report back to the government.Additionally, the Ministry of Transport was asked to complete a report on the project for the Politburo and National Assembly, clarifying the total investment, progress schedule, significance of the project, and specific mechanisms needed for its successful implementation.Ministries were also urged to send their ideas on mechanisms and policies for the project to the Ministry of Transport soon.Binh also agreed on adding the Dau Giay-Phan Thiet section to the project, saying it will be discussed in another meeting. A national steering committee will be set up on the investment of the project led by deputy prime minister Trinh Dinh Dung.The committee will have responsibility for directing implementation. Meanwhile, the Ministry of Transport will be in charge of conducting the project.The State Bank of Vietnam was assigned to propose measures to mobilise capital re-


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sources for the expressway, while monitoring the provision of credit to ensure inves-tors' responsibility in providing promised capital.The ministries of Planning and Investment, Finance, Natural Resources and Environ-ment, Construction and other relevant ministries and agencies were requested to de-sign supervision mechanisms for the implementation of the project in the form of build-operate-transfer (BOT).Limited budgetAccording to experts, exhausting the investment sources of the State budget, banks and investors is the biggest obstacle facing the North-South Expressway project.Total investment from the State and investors for the project's first phase reached more than VND140 trillion. Meanwhile, domestic investors lacked sufficient funds after in-vesting in National Highway 1A and other BOT projects.The transport ministry has proposed several specific mechanisms to solve the issues, such as guaranteeing investors' benefits at 14 per cent or allowing investors to derive benefits from wayside stations along the expressway.The ministry also proposed calling for investment from foreign investors. However, according to the ministry, through consultation, potential investors and international finance organisations said that Vietnamese legal regulations have changed dramatical-ly, the national credit level remains low while land clearance procedures are compli-cated. Additionally, the cost and timescale of the project is unstable.The transport ministry proposed three specific mechanisms for foreign investors a turnover guarantee, an exchange rate guarantee and a guarantee for the third party on the government's responsibility.Mai Tuan Anh, general director of Vietnam Expressway Corporation said that the company had submitted to the transport ministry a plan to sell highway fee collection rights (firstly on the Cau Gie-Ninh Binh highway) in order to invest in new express-ways.http://bizhub.vn/news/deputy-pm-puts-emphasis-on-expressway-project_286192.html

HCM City still prone to inundation as many flood control projects undone


Residents should expect flooding when there is heavy rain as just 23 of 40 flood-prone sites have been rehabilitated, according to the HCM City Steering centre of Urban Flood Control Programme.Flood control projects are still underway at 17 sites in the city. This explains why tor-rential downpours on Monday led traffic on many roads to grind to a halt because of heavy flooding.Among the projects is phase one of a flood tide control project which will build six flood gates, three pumping stations and an eight-kilometer dyke along the Saigon Riv-er. According to Trung Nam Group, the investor of the project, the project is about 40 percent complete and will be ready in April 2018.The project will benefit about 6.5 million people living in a vast basin area covering about 570 square kilometers.The steering centre is implementing 35 other flood control projects. Nine of them will be completed within the first half of 2017, reducing flooding on roads such as An Duong Vuong Street in Binh Tan District, Do Xuan Hop Street in District 9 and other streets in Binh Thanh, Hoc Mon and Thu Duc districts. Meanwhile, 11 projects are scheduled for completion in the final half of the year and the remainder after 2017.However, many projects in the flood control plan have yet to get off the ground due to financial constraints. For instance, the Rach Tra (Tra canal) tide control project has not been allocated funding. If it gets funding, it could be finished by 2019.A project to build a dike along the Saigon River from Vam Thuat to Kinh rivers is being prepared and the city government is calling for investment in the project through pub-lic-private partnership (PPP).For a flood control project on the left bank of the Saigon River from Cau Ngang canal to Thu Thiem new urban area, the Steering centre of Urban Flood Control Programme


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is in the process of finding contractors and working with consultants to determine the project's location and with districts 2 and Thu Duc to pay site clearance compensation for affected families.Major projects for dredging canals to improve drainage are included in the flood con-trol programme but no finances have been arranged for them.A project to prevent flooding at Tan Son Nhat International Airport is expected to start in the first quarter of 2018. In the short run, the Steering centre will dredge along a ca-nal inside the airport to reduce flooding in this rainy season.Construction of a water reservoir, another important anti-flood project for Tan Son Nhat International Airport, has yet to begin due to land-related difficulties.The southern weather centre said this year's rainfall in HCM City could be high at the beginning of the rainy season.http://english.thesaigontimes.vn/53989/-HCM City-still-prone-to-inundation-as-many-flood-control-projects-undone.html

Homes unpossessable for foreign owners made public


The government has ordered the Ministry of Public Security and the Ministry of Na-tional Defense to cooperate closely with all Provincial Departments of Construction to make public the lists of real estate projects which foreign organisations and individu-als will be unable to own.Under the 2014 Housing Law, all foreign organisations or individuals are eligible for homeownership in Vietnam.In order to put the law into practice, the Ministry of Construction (MOC) has sent let-ters to all municipal and provincial People's Committees nationwide, asking them to facilitate conditions for foreign organisations and individuals so they can apply for homeownership at their place of residence.According to the MOC, all information relating to foreign homeownership must be posted on the web sites of local Provincial Departments of Construction.If any foreign organisation or individual is facing problems in the pursuit of owning a house in Vietnam, they should send their concerns to the MOC.http://bizhub.vn/property/homes-unpossessable-for-foreign-owners-made-public_286193.html

Deputy PM puts emphasis on expressway project


Specific policies and mechanisms are needed to draw investment and hasten the progress of the North-South Expressway. However, they must be conducted in an open and transparent manner, said deputy prime minister Truong Hoa Binh at a recent meeting on the project.The North-South Expressway is an important national project, which needs govern-ment approval before submission to the Politburo and National Assembly, he said.The deputy PM asked the State appraisal council to promptly appraise the project and report back to the government.Additionally, the Ministry of Transport was asked to complete a report on the project for the Politburo and National Assembly, clarifying the total investment, progress schedule, significance of the project, and specific mechanisms needed for its successful implementation.Ministries were also urged to send their ideas on mechanisms and policies for the project to the Ministry of Transport soon.Binh also agreed on adding the Dau Giay-Phan Thiet section to the project, saying it will be discussed in another meeting. A national steering committee will be set up on the investment of the project led by deputy prime minister Trinh Dinh Dung.The committee will have responsibility for directing implementation. Meanwhile, the Ministry of Transport will be in charge of conducting the project.The State Bank of Vietnam was assigned to propose measures to mobilise capital re-sources for the expressway, while monitoring the provision of credit to ensure inves-tors' responsibility in providing promised capital.


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The ministries of Planning and Investment, Finance, Natural Resources and Environ-ment, Construction and other relevant ministries and agencies were requested to de-sign supervision mechanisms for the implementation of the project in the form of build-operate-transfer (BOT).Limited budgetAccording to experts, exhausting the investment sources of the State budget, banks and investors is the biggest obstacle facing the North-South Expressway project.Total investment from the State and investors for the project's first phase reached more than VND140 trillion. Meanwhile, domestic investors lacked sufficient funds after in-vesting in National Highway 1A and other BOT projects.The transport ministry has proposed several specific mechanisms to solve the issues, such as guaranteeing investors' benefits at 14 per cent or allowing investors to derive benefits from wayside stations along the expressway.The ministry also proposed calling for investment from foreign investors. However, according to the ministry, through consultation, potential investors and international finance organisations said that Vietnamese legal regulations have changed dramatical-ly, the national credit level remains low while land clearance procedures are compli-cated. Additionally, the cost and timescale of the project is unstable.The transport ministry proposed three specific mechanisms for foreign investors a turnover guarantee, an exchange rate guarantee and a guarantee for the third party on the government's responsibility.Mai Tuan Anh, general director of Vietnam Expressway Corporation said that the company had submitted to the transport ministry a plan to sell highway fee collection rights (firstly on the Cau Gie-Ninh Binh highway) in order to invest in new express-ways.http://bizhub.vn/news/deputy-pm-puts-emphasis-on-expressway-project_286192.html

Vietnam's first smart city communications platform launched

18/MAY/2017 INTELLASIA| VN ECONOMIC TIMES

Trilliant Networks and HCM City Power Corporation successfully complete pilot of Vietnam's first smart city communications platform.Trilliant Networks, a global provider of Internet of Things (IoT) and smart energy so-lutions, together with the HCM City Power Corporation (EVNHCMC), has successful-ly completed the pilot of Vietnam's first smart city communications platform.The platform serves as a foundational step in Electricity of Vietnam (EVN)'s commit-ment to advancing efficiency, reliability, and affordability of energy for their custom-ers."In a region where significant populations and GDP growth are creating unique and pressing challenges, Vietnam is among the first to take a tangible step towards ad-dressing those challenges," said Bryan Spear, Managing director, Trilliant, Asia Pacif-ic. "Vietnam is not only planning to address critical challenges for the future, this project shows they are taking action, with one of the first true smart city demonstration projects in the region now a reality."First developed in May 2016, the platform completed its year-long pilot project at Sai-gon Hi-Tech Park (SHTP), the centerpiece of Vietnam's bid to make HCM City the "Sil-icon Valley of the Pacific". Extending from customer meters at SHTP to EVNHCMC's operations centre, the platform demonstrates that solutions can be tested in a micro-city like an industrial park, then scaled up to be deployed citywide and nationwide. The communications network incorporates a variety of technologies that are suited to the needs of the varied terrain, customers, and system characteristics across EVNHC-MC's distribution network.Vietnam is experiencing over 8 per cent annual energy demand growth and southern Vietnam is expected to have energy shortages within two years. As a result, the coun-try has embarked on aggressive energy efficiency and smart city initiatives. Trilliant's platform will help proactively solve these energy dilemmas. The solution cost-effec-tively improves utility performance across key organisational goals including revenue


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generation, network performance and large-scale integration of renewable resources, improving workforce management, engaging customers, advancing operational excel-lence and improving energy efficiency.Using an advanced RF network for AMI, the potential benefits of a digitalised ap-proach are clear, positioning EVNHCMC to leapfrog ahead technologically. Today, the utility is in discussions to leverage the same network to provide smart street light-ing solutions as part of HCM City's smart city initiatives."EVNHCMC plans to continue to build infrastructure and intelligence to meet Viet-nam's growing energy needs and to help meet the tremendous energy demand of the region's growing economy with smarter, clean, reliable, and affordable power," said Tran Khiem Tuan, EVNHCMC deputy general director.Trilliant(R) offers the energy industry's only enterprise-wide Smart Communications Platform for connecting IoT through a secure, standards-based, multi-technology, open spectrum solution. With three decades' experience and the most field-proven and globally compliant solution, Trilliant maximises smart grid and smart city investments and makes operations future-ready.EVNHCMC is one of five electricity distribution utilities under EVN. Its main task is to distribute electricity in HCM City.http://vneconomictimes.com/article/business/vietnam-s-first-smart-city-communica-tions-platform-launched

$18.15 million disbursed for Cat Linh Ha Dong railway project


The China Eximbank has disbursed 18.25 million USD for the Cat Linh Ha Dong Rail-way Project, said Vu Hong Phuong, deputy director general of the Railway Project Management Unit under the Ministry of Transport, on May 16.The amount, part of the delayed 22.75 million USD, has been transferred to the Engi-neering, Procurement, Construction (EPC) contractor, to be paid to sub-contractors.The project has completed 90 percent of the construction work. Equipment installation is underway, Phuong said.However, the delay in capital disbursement has hindered the progress of the project.The Railway Project Management Unit and relevant bodies will supervise the payment process for sub-contractors to ensure they have financial sources for construction.It will also push the EPC contractor and sub-contractors to speed up the construction to make up for the delay.The project is scheduled to begin trial run in October and be put into official operation in the second quarter of 2018.Originally slated to be finished two years ago, capital issues have hindered the progress of the capital's first metro line, threatening to derail the project.The Cat Linh-Ha Dong urban railway will have 12 stations and one depot area. Out of the initially projected investment of 552 million USD, 419 million USD (76 percent) were loans from China and the rest matching funds by the Vietnamese government.Construction started in 2011 but since then costs have risen to 886 million USD, exceed-ing the original figure by 250 million USD, or a 160 percent increase.An additional preferential loan worth 250.62 million USD, negotiated three years ago, was signed between the Ministry of Finance and China Eximbank on May 11.http://english.vietnamnet.vn/fms/business/178535/-18-15 million-disbursed-for-cat-linh---ha-dong-railway-project.html

Thai Nguyen spends 840 billion VND on agricultural restructuring


The northern province of Thai Nguyen plans to splash out 840 billion VND (37 million USD) to restructure its agriculture, over 700 billion VND (30.8 million USD) of which comes from the state budget and the remainder is mobilised from other legal financial resources.The province is striving to plant new tea seedlings in 80 percent of its total cultivation land by 2020 under a project to shake up agriculture towards increasing added value and sustainable development in the 2017-2020 period.


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As a local staple, tea farming land will be expanded to 22,000 hectares, 5,000 hectares of which will be zoned off for organic tea cultivation. The province expects to have at least 300 hectares of tea meeting VietGAP standards.The restructuring will shift the focus onto plants with high economic efficiency and aquaculture. A large scale production zone will be set up in an area of around 5,000 hectares.Regarding husbandry, the province will restructure pig herds, develop cross-bred cow, branch out farms applying high technology and build 6-8 standard slaughter-houses. Production chain in agriculture should be paid due attention, ensuring that 70 percent of farms have consumption contracts by 2020.The provincial agriculture sector will plant 10,000 hectares of large wood trees and 15,000 hectares of intensive small timber while converting 4,300 hectares of poor nat-ural woodland into production forest. Wood production plants will be also construct-ed in the locality.The province targets to stabilise forest coverage at 50 percent as well as enhance forest plantation productivity and quality.Meanwhile, aquaculture will be cultivated following intensive and semi-intensive farming models. The agriculture sector expects to receive over 690 billion VND (30.4 million USD) from aquaculture production value and earn 100 million VND (4,400 USD) per hectare per year.According to Ngo Xuan Hai, director of the provincial Department of Agriculture and Rural Development, the province has set up five safe fruit production zones in a total land of more than 390 hectares and eight fresh vegetable plantation zones with total areas of 82 hectares. Some 700 hectares of safe tea were granted with VietGap certifi-cation.Key husbandry areas were thrown up in the locality, including chicken farming in Phu Binh, Dinh Hoa and Vo Nhai districts, and pig raising farms in Phu Binh and Pho Yen districts.The province has inked a line-up of agreements on organic agriculture investment and consumption for the 2017-2021 period. Accordingly, the locality will plant 250 hectares of rice, 5,000 hectares of tea and 500 hectares of vegetable in concentrating production zones.Latest evaluation from the provincial People's Committee showed that small scale pro-duction coupled with low rate of industrial processing in agricultural products have hampered local agriculture.The agriculture restructuring scheme is a key drive to promote agricultural growth, improve livelihood in rural areas and make contribution to realising the national tar-get programme on sustainable poverty reduction and building new style rural areas.http://en.vietnamplus.vn/thai-nguyen-spends-840 billion-vnd-on-agricultural-re-structuring/111859.vnp

Government instruction bans overlapping inspections at firms


The government has issued an instruction on avoiding overlapping inspections car-ried out by inter-sectoral and competent forces such as police, customs officers and in-spectors.The instruction was issued right after a conference between prime minister Nguyen Xuan Phuc and businesses in Hanoi on May 17, where the government received many opinions from enterprises and associations as well as proposals of the Vietnam Cham-ber of Commerce and Industry.Minister, Chair of the government Office Mai Tien Dung said at a press briefing on the same day that Instruction No. 20/2017/CT-TTg aims to create the best possible condi-tions for production and business activities on the basis of the government's Resolu-tion No. 35/2016/NQ-CP on business support and development until 2020.The minister noted that overlapping inspections have raised concerns among busi-nesses as they affect their production and business activities.The issuance of the instruction demonstrated the government's prompt and drastic re-


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sponse in concerted efforts with agencies to support the development of enterprises, Dung said.The instruction is expected to change the mindset of about 4.9 million trading house-holds which have refused to transform into businesses due to concerns about taxes, fees and inspections.The document makes it clear the responsibility of units and agencies as well as of the municipal and provincial People's Committees for ratifying inspection plans since the beginning of each year.Each business will be inspected or audited no more than once a year except cases where firms are found to violate laws, Dung stressed.http://en.vietnamplus.vn/government-instruction-bans-overlapping-inspections-at-firms/111870.vnp

Expert sees no need for SME support law


Vietnam should create a transparent and level playing field for businesses, instead of building a law supporting small and medium enterprises (SMEs), said Dr Vu Thanh Tu Anh, director of research at Fulbright University.Speaking at a talk held in HCM City on May 15 on Vietnam's economic performance in the first four months of the year and outstanding government policies, Anh said such support would lead businesses to develop a sense of reliance.Moreover, the draft law contains multiple counterproductive provisions. Firstly, if SMEs enjoy tax breaks, large corporations may be split into smaller units to gain access to this tax support.Secondly, the draft law allows SMEs to access loan interest support but the problem is where funding will come from at a time when the government has an extremely tight budget."This draft law looks unworkable and impractical," said Anh.Vietnam has a slew of legal frameworks supportive of SMEs. But a survey which the Vietnam Chamber of Commerce and Industry (VCCI) released earlier this year showed the proportion of SMEs that have taken advantage of them is only 15%. There-fore, a law on SME support would prove to be redundant, he noted.According to Anh, if the government really wants to support SMEs, the most impor-tant thing is to create a business environment with fair competition and transparency, and to help businesses cut costs.The current business ecosystem in Vietnam is unhealthy, Anh said. State-owned enter-prises (SOEs) benefit from monopolistic rights while foreign-invested companies are entitled to a host of policy incentives. "SMEs can never be able to compete with those giants."In assessing Vietnam's economic situation, he said it would be impossible to achieve the GDP growth target of 6.7 percent this year because productivity is edging down. Still, Vietnam can translate the target into reality by injecting more money into the economy or pumping more crude oil but these measures could destabilise the econo-my.http://english.thesaigontimes.vn/53986/-Expert-sees-no-need-for-SME-support-law.html

Businesses appreciate government Resolution 35 on developing enterprises


The business community has put forward recommendations for the more effective im-plementation of the government's Resolution No.35/NQ-CP on supporting and devel-oping enterprises through 2020 at a conference with the prime minister in Hanoi on May 17.A quick survey in late 2016 and early 2017 of the Vietnam Chamber of Commerce and Industry (VCCI) showed three quarters of responded businesses think the five groups of solutions set in the resolution have brought about "positive" impacts, and only one quarter said they have not felt any effect.However, participants pointed out that the Resolution has yet to meet expectations,


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failing to produce substantive favourable conditions or create real driving forces for the reform of institutions while the business environment is slow to improve.They attributed those failures to the unclear definition of power and responsibility, and the poor enforcement of the government and prime minister's instructions.Chair of the Vietnam Association of Small and Medium Enterprises Nguyen Van Than called on the government to take measures to reduce production cost.Businesses themselves should abide by law and proactively improve their capacity, he said, adding that big companies need to support smaller ones in the sale of products to join the global value chain.President of the BRG Group Nguyen Thi Nga hoped the government will devise a mechanism soon to allow businesses to operate on an equal footing with other eco-nomic sectors, and build a clear and specific legal corridor to spur business develop-ment.To address the shortcomings, minister of Planning and Investment Nguyen Chi Dung said the government will push ahead with administrative reform to enable businesses to develop in all fields and sectors as well as encourage business households and indi-viduals to forge connectivity to form companies, and support enterprises to promote innovation, industrial modernisation, and human resources development.He urged ministries and departments to revise and simplify business and investment regulations in accordance with the Law on Investment and Law on Enterprises.http://en.vietnamplus.vn/businesses-appreciate-govt-resolution-35-on-developing-enterprises/111844.vnp

Barriers to business hard to dismantle


Fresh from the Party Central Committee's adoption last week of a pro-private sector resolution, prime minister Nguyen Xuan Phuc will meet with private business on May 17. But the path ahead will still be bumpy for the private sector.Confidence building first"We need to have the confidence of business first," President Vu Tien Loc of the Viet-nam Chamber of Commerce and Industry (VCCI) said when the prime minister first met with the domestic private business community a year ago. A year later, ahead of his second meeting with local private enterprises, Loc said he would give the same an-swer if he got a question about this matter.However, minister of Planning and Investment Nguyen Chi Dung said the govern-ment did a lot last year to improve the business environment, with 50 government de-crees issued to chiefly do away with business and investment conditions.The Ministry of Industry and Trade has abolished and amended some regulations on testing of textiles and garments for formaldehyde, modified the rule on energy labe-ling, and simplified the procedures for chemical declaration.The Ministry of Finance has launched an online tax filing and payment system at the tax departments of 63 cities and provinces nationwide. minister of Finance Dinh Tien Dung has pledged the tax authority would apply an e-invoicing system to all enter-prises.In a report prepared for the meeting on May 17, Dung said Vietnam's investment and business environment had been significantly improved, which has been acknowl-edged by international organisations. According to the World Bank, Vietnam rose by nine notches, ranking 82nd out of 190 economies measured in the 14th edition of the Doing Business 2016 report which the World Bank released in October last year.A survey by the Japan External Trade Organisation (JETRO) showed Vietnam remains an important investment destination for Japanese companies active in Vietnam, with over 66 percent of them intending to expand business operations here.According to the American Chamber of Commerce (AmCham), 36 percent of US firms surveyed plan to step up business here in Vietnam, versus 48 percent in Indonesia, 21 percent in Thailand and 19 percent in Malaysia.Since the meeting in April 2016 between the prime minister and business executives, over 1,098 requests from the private business community have been received and


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transferred to relevant State agencies for resolution, with 850 of them already solved, Loc said.Dogged by difficultiesBusinesses are persistently dogged by multiple difficulties, though. Loc of VCCI said that last week he received a call for help from a bus station investor. The company de-veloped a new bus station after local government had promised to dismantle the old one. However, when the new station is complete, the old station is still in place, throw-ing the investor into a difficult position as passengers still use the old station.Loc has several times called for local leaders to make good on their promise and even threatened to bring the case to the meeting on May 17.But in some other cases, Loc said he is helpless.The Ministry of Planning and Investment said input costs such as electricity, logistics, infrastructure and BOT charges remain high. For example, the cost of transporting a cargo container from Hai Phong City to Hanoi City (about 100 kilometers) is three times higher than that of shipping from China or South Korea to Vietnam.There are other costs relating to red tape, delays, high fuel prices or freight surcharges, according to VCCI.In the report to the prime minister, VCCI said informal costs tend to rise, with 66 per-cent of 11,000 respondents saying they have to live with that. "All in all, the situation has not improved much over the years," Loc said in the report.One-tenth of firms surveyed from 2014 to 2016 said informal fees accounted for more than 10 percent of their total revenues, well above 6-8 percent in the previous five-year period.Increasing labour costs are another concern. VCCI cites JETRO research in February 2017 as saying that nearly 60 percent of businesses are afraid of high labour costs in Vietnam.Meanwhile, Vietnam's labour productivity is 16 times lower than that of Singapore, 11 times lower than Japan's and 10 times lower than South Korea's, according to the In-ternational Labour Organisation (ILO).In 2016, a record of 110,000 enterprises were newly registered but more than 73,000 businesses became inactive or disbanded. "These facts show that private businesses are still struggling," Loc said.http://english.thesaigontimes.vn/53974/Barriers-to-business-hard-to-dismantle.html

How to develop private equity in Vietnam


Andy Ho, Managing director & Chief Investment Officer at VinaCapital, shares his views on the recent development of private equity investments in Vietnam.Vietnam's financial market has not been showing signs of stable investment over the past few months. Do you agree?I think Vietnam's stock markets have done well since the beginning of the year. The VN Index has increased by 8.2 percent (in US dollar term). It can always be more stable, but we like a little instability so as to create more opportunities for investments and divestments.How do you view the performance of private equity (P/E) investments in Vietnam in 2017?Private equity is a long-term investment activity so it is difficult to make an assessment over a four-month period. However, I can say that we have opportunities of over $200m in our pipeline and we are currently going through due diligence with three large private equity opportunities.For which business sectors in Vietnam do you believe P/E could be profitable in the long run?We focus on private businesses operating in sectors that contribute to the growth of the domestic economy. Most or all of these opportunities are in profit businesses. The key is what sort of valuations and terms we have to invest with. If the valuations are lower, we have a higher chance of having a very profitable investment and vice versa.How has VinaCapital prepared for its future P/E investments into Vietnamese firms in


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2017 and coming years?Preparing for private equity investments is a very difficult task and comes with many years of experience. The key is reviewing the business and management before we in-vest and having a good exit strategy.What should authorities do to facilitate the market for P/E investments?Private equity is private and thus, really does not involve the government. The gov-ernment should continue to help develop rules and regulations to improve the invest-ment environment in general.How do you assess Vietnam's equitisation process?Vietnam has been equitising State-owned enterprises (SOEs) over the last 15 years and has made solid progress. Included in such success is Vinamilk, Bao Viet and Vietcom-bank. More recent success includes the Aviation Corporation of Vietnam (ACV), in which we have been fortunate enough to be a major investor. However, there are those who think the process of equitisation has been slower than planned. As a result, the government has made a few changes to ensure that the process will speed up and be-come more successful.The equitisation process is one in which employees of the SOEs are enfranchised to own a small piece of their business and align their interests with new and existing shareholders, including the State (since the State normally remains a major sharehold-er). After equitising, our experience indicates that SOE's tend to operate more efficient-ly and effectively, increasing the shareholder value of the business. in a number of cases, we also see better and more effective application of capital in various projects and investments.In your view, how can the process be improved?Foreign investors have made some recommendations to improve the process of equi-tisation, including extending the time available for investors to consider the opportu-nities after prospectuses are provided and to increase the quality of information disclosed in the prospectuses. Such improvements should in theory attract more inves-tors and increase the value of the stake the government wishes to divest.We would also like to point out that many of the management teams of these SOE's being equitised are reluctant to meet with foreign investors mostly because they are not comfortable conversing in English. At VinaCapital, we tend to have good access to these management teams because we are Vietnamese and they do provide us with a lot more relevant information to assess, but we do encourage them to become mor pro-ficient in English to encourage international investors to participate.What do you recommend for foreign investors interested in the SOE equitisation?We understand that it can be quite cumbersome for foreigners to register for a trading account in Vietnam (a requirement to participate in equitisation). We would encourage foreign investors that want to participate in the equitisation process in Vietnam to visit international investors like us and we can share with them how we navigate this proc-ess quickly and effectively. At the end of the day, the government is encouraging for-eigners to invest in Vietnam and trying to make it as easy and least costly as possible to participate in the equitisation process.http://english.vietnamnet.vn/fms/business/178478/how-to-develop-private-equity-in-vietnam.html

PM conference with businesses seeks development measures


Enterprises across Vietnam contributed their ideas to making breakthrough policies in service of the efficient enforcement of the government's resolution on supporting and developing businesses until 2020 during the ongoing conference between the prime minister and businesses in Hanoi.Pham Hong Hai, Hongkong and Shanghai Banking Corporation Ltd (HSBC) Manag-ing director, said that in the context of a changing world economy, Vietnam is emerg-ing as a spotlight in the region with its advantageous competitive labour cost, and political and macro-economic stability.The country has become a production centre with a number of big projects and billion-


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USD contracts, he stated, adding that the government's commitment to becoming an incorruptible, active and constructive government also helps inspire the business com-munity.Hai suggested the government pay attention to connecting domestic and foreign-in-vested enterprises as well as to the fields that Vietnam has competitive advantages.Businesses should invest in technology in order to develop and compete sustainably, while the nation should intensify educational reform in order to increase labour pro-ductivity and speed up the national renewal, especially in the context that Vietnam is integrating into the global economy, he added.Representing construction businesses, Le Van Kiem, Chair of the Board of directors of the Long Thanh Golf Investment and Trading Joint Stock Company, expressed con-cern over the financial matter.He proposed the government act as a guarantee for interest rates to facilitate the im-plementation of long-term projects.Meanwhile, Pham Van Son, member of the directors' board of BMJ Group, requested the government to seek ways to help livestock breeders, and veterinary medicine and cattle-feed companies and distributors deal with difficulties by rescheduling debt pay-ment for them.Nguyen Duu De, Chair of the Hop Luc Joint Stock Company cum President of the Business Association of Thanh Hoa province and President of the Vietnamese Private Hospital Association, emphasized the need to rearrange the public servant staff in or-der to raise the efficiency of the government resolution.It is also necessary to attract the involvement of private enterprises in the health sector to share overloads of state-owned hospitals.In the real estate sector, President of the HCM City Real Estate Association Le Hoang Chau showed his hope that the government will consider solutions to tackling hidden risks of the real estate market, including permitting land use and land-related asset rights mortgaged at foreign banks and revising the law on investment and businesses.http://english.vov.vn/economy/pm-conference-with-businesses-seeks-development-measures-349718.vov

Government to focus on reducing costs of doing business


At the dialogue between the government and private sector companies, representa-tives of government agencies have answered complaints and made promises of the things they are going to do in the near future to support the development of the private sector. Immediately after the conference, prime minister Nguyen Xuan Phuc signed Directive 20 on adjusting the practice of inspecting and examining companies. Below are quotes from the PM and government agencies.Prime minister Nguyen Xuan PhucCompared to last year's conference, there were not many strong complaints, which means that the government's policies in the past year have been solving the right prob-lems.The government has achieved encouraging results in supporting and developing com-panies and improving the business environment. However, we are aware that compa-nies are still facing obstacles.In terms of regulations, there are still overlapping regulations and there are regula-tions that are not practical. We will build policies that ensure equality between state-owned and private sector companies.Taxes and fees are still high, administrative procedures are still inconvenient to com-panies. Some state employees are asking for under-the-table money. Some companies are still having difficulties accessing capital and the market. There is still overlapping in the inspection and examination of companies, causing serious inconvenience.In the near future, the government will focus on creating a transparent business envi-ronment that is convenient for companies. The chairmen of local people's committees and the secretaries of local party committees, as well as ministers should carry out these tasks.


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The government aims to create equal opportunities for all economic sectors and will strive to optimise resources for development and introduce measures to decrease costs for companies. This year, we will focus on cutting the financial burdens companies have to bear.Deputy prime minister Truong Hoa BinhThe government will optimise the institution to facilitate companies' development. The mechanism and policies must be in line with the market economy and internation-al practices. Additionally, the government should ensure that these policies can mobi-lise all the resources and knowledge of the people to serve the national economic growth.The government will continue with the administrative reform, boosting its capacity to carry out policies. Meanwhile, there will be strict punishments to answer the violations of agencies or officials who annoy or harass enterprises. It is especially necessary to en-hance the capacity of judiciary officials to better protect ownership rights and the free-dom to do business. The government will fight corruption and prevent other violations.Enterprises should have long-term vision, invest in science and technology, and obey the laws and regulations. Business associations should enhance their operation effi-ciency and strive to have a strong voice in policy discourse and policy building.Deputy prime minister Vu Duc DamThe biggest obstacle of enterprises is administrative procedures, access to land, and taxation. I propose localities and ministries to carefully consider the complaints of businesses. Localities and ministries should increase information exchange and in-volve enterprises in their discussions, as well as promote the role of business associa-tions in solving enterprises' most burning problems.Government agencies must be more determined. Policies need to be specific and prac-tical to satisfy the requirements of enterprises and reduce unofficial costs. Also, public services have to be electronic to be transparent.To Lam minister of Public SecurityThe Ministry of Public Security will continue to speed up the reform of administrative procedures and create favourable conditions for people and businesses, enhance secu-rity and order in industrial parks and economic zones, prevent the formation of gath-ering places for gangs and social evils causing insecurity and disorder. The ministry will focus on destroying economic crime groups, contributing to a safe and equitable business investment environment.The Ministry of Public Security also proposes that companies actively cooperate with the authorities in solving grievances and ensuring traffic order and safety, eliminating oversized vehicles, ensuring fire safety and (general?) security.Le Minh Tri Prosecutor general of the Supreme People's ProcuracyResolution 35 issued by the government is an important legal basis for companies' de-velopment. The central agencies are acutely aware of their responsibility to support and develop enterprises, however, in some localities, this awareness is lower.I propose the government to increase examinations in subordinate agencies and set strict punishments for violations to avoid recidivism. Meanwhile, the government should review the administrative procedures, adjust the shortcomings, and promote transparency.The Supreme People's Procuracy will study and eliminate the loopholes to prevent il-legal profiteering by punishing violators to protect law-abiding enterprises. We will strive not to criminalise civil and economic relationships and propose the relevant agencies to adjust improper regulations.The Supreme People's Procuracy promises to stand by the government and compa-nies.Minister of Natural Resources and Environment Tran Hong HaIt is important to identify the environmentally responsible companies entitled to re-ceive preferential and friendly policies from state agencies. A separate mechanism should be applied for enterprises which can have negative effects on the environment


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and use backward technology.The government will adopt different policies towards environmentally friendly enter-prises complying with environmental regulations and strictly control activities that are likely to cause serious pollution, with an aim to ensure sustainable development.Regarding the specific complaints, the ministry is reviewing policies and laws on land and natural resources, with a mind to create the most conducive terms for enterprises and ensure the interests of people and sustainable development.Tran Tuan Anh minister of Industry and TradeThe Ministry of Industry and Trade received many complaints from enterprises at the previous meeting. We reviewed and revised a number of out-dated regulations, issued more than 40 new circulars, and submitted 21 decrees and decisions to the government and the PM to amend and promulgate over the past year.The ministry is also working to amend the inadequate regulations concerning gas, al-cohol, and mineral businesses, while continuing to simplify administrative proce-dures, accelerate the application of online public services, support enterprises in accessing the market, promote their competitive advantages, and create the most fa-vourable conditions for enterprises.Nguyen Duc Chung Chair of the Hanoi People's CommitteeHanoi will carry out a wide range of solutions to support companies. Hanoi promises to reform in order to support companies' development. Measures will include regular dialogues to tackle obstacles as they emerge, building a modern administration sys-tem, building an e-government system and smart city, as well as supporting startup companies to access resources like land and production sites and providing help to train human resources. In addition, Hanoi will work to connect companies with banks, helping them access the market and new technologies, and promote regional linkages.Hanoi is sending proposals to the government regarding the equitisation of SOEs, the transformation of public non-business units, and technology transfer.http://www.vir.com.vn/government-to-focus-on-reducing-costs-of-doing-busi-ness.html

Vietnam business leaders losing battle to become competitive

18/MAY/2017 INTELLASIA| VOV

Private sector small businesses in retail and manufacturing are not demonstrating an ability to effectively compete in the international marketplace, says Dinh Thi My Loan, chair of the Vietnam Retailers Association.The signs of the problem have been visible for some time, said Ms Loan at a recent roundtable in Hanoi.Virtually all the growth in retail sales and jobs created in the economy over the last few years were in the foreign sector, which is a sure sign that the domestic sector is not nur-turing its ability to contend.Role of management in tackling competitivenessManagement is the art and science of getting things done, said Ms Loan, noting that if there are shortfalls in the ability to compete, then surely the quality of management is the root cause of the problem.Business leaders are always pointing the finger at someone else saying they are ham-pered by such things as government-created constraints, the tax code, high import tar-iffs, non-tariff trade barriers of other countries, and complicated laws and regulations, among a host of other excuses.But they never accept any blame or responsibility for the problem nor exhibit the kind of enterprising 'can-do' management attitude that is fundamentally necessary for suc-cess.As a result, businesses have invested less in shared resources of the country such as pools of skilled labour, supplier networks, an educated populace, and the physical and technical infrastructure on which the country's competitiveness ultimately depends, said Ms Loan.Lack of innovation that can cope with competitionAlmost all small and large business managers in the country across all sectors and seg-


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ments are overly focused on short term sales, said Ms Loan. If they are innovating it is only with respect to efficiency and cost reduction.Cost saving innovations in and of themselves will never lead to the country becoming competitive in the national or international marketplaces, Ms Loan underscored.The domestic private sector needs game changing value added innovation of the kind that transforms the economy and leads to productivity and economic growth across a broad spectrum of industries, resulting in higher incomes for Vietnamese workers.Ecommerce is a prime example of the innovation needed. It plays a pivotal role in eco-nomic growth and yet Vietnamese business leaders, of large and small companies alike, have outright flatly refused or failed to drive innovation through ecommerce.What is required, said Ms Loan, is for chief executives and small business owners to embrace an ethos of imagination, exploration, experiment and discovery in their work-places of the type that can lead to high corporate dynamism and international compet-itiveness.Simply creating start-up incubators and improving worker training as many suggest would not result in greater competitiveness, said Ms Loan, nothing that these are symptoms of the problem rather than the root cause of the lack of competitiveness.If the overall strategy of business executives and small business owners is short-sight-ed and ill conceived, more talent won't help as it will end up being directed in the wrong direction, not redressing competitiveness.Missing in action: the customerBusiness executives universally fail to understand that the fundamental shift in the Vi-etnam economy over the past few years is the change in the balance of power in the marketplace from the seller to customer.This shift flows directly from globalisation and free trade deals such as the Asean Eco-nomic Community.If Vietnamese business leaders don't change their ways and adapt to the new consum-er oriented marketplace, their current customers will most surely vanish and their businesses die.In the past, being just a tad bit cheaper in the selling price may have been enough to get by in Vietnam, but those days are gone forever. Now to survive, retailers and man-ufacturers must excel with their customers on a national as well as international basis in many cases.To become competitive, business leaders and small business owners must first go back to the basics and start with understanding what a business is and its purpose. There is only one business purpose and that is to create a customer.Only by focusing creatively on delivering a product with high added value to custom-ers will Vietnamese business leaders and small business owners learn to become com-petitive with their foreign counterparts, Ms Loan concludes.http://english.vov.vn/economy/vietnam-business-leaders-losing-battle-to-become-competitive-349680.vov

Tax, customs policies remain roadblocks to enterprises


While acknowledging the government's efforts in tax reforms, many enterprises say cumbersome tax and customs procedures are blunting the country's advantage in low-price labour. Participants discussed this at a recent EuroCham workshop on changes in tax and customs regulations.The European Chamber of Commerce in Vietnam lauded reforms the country has made in tax and customs administrative procedures, maintaining that it has helped en-terprises. However, incomprehensive reforms have led to misunderstandings between agencies and businesses, the chamber said.A survey by the Vietnam Chamber of Commerce and Industry in 2016 showed that 41 per-cent of businesses were annoyed by tax administrative procedures. Some 31 percent of businesses had to pay non-official fees, much higher than the figure in 2015.Most enterprises said they do not want to sue state agencies. As a result, they hope tax and customs related policies should be clear, consistent and easy for enterprises to follow.


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Change is coming 18/MAY/2017 INTELLASIA| VN ECONOMIC TIMES

VET sought the opinions of business leaders on what the fourth industrial revolution has in store for Vietnam.In this current stage of the manufacturing sector, Vietnam is still behind Malaysia and Singapore, which are almost at the robotics or semi-automation level. Given the high cost, there is also a lack of awareness and understanding among Vietnamese compa-nies in regard to the benefits that automation can bring. This is not a big problem, how-ever, but rather an opportunity for companies like Hitachi Systems. I believe that once Vietnamese companies see the benefits over a long-term basis, they will be quick to adapt to the trend.I understand the Vietnamese government is now looking at Industry 4.0 as a way to sustain the country's competitiveness. However, the road for Vietnam to enter Indus-try 4.0 will differ from other countries. Many foreign companies still see Vietnam with-in the "China plus one" model, with many companies in China diversifying their operations by adding another location in Vietnam. Though Vietnam is on a good track, the country should not follow the same path China chose. Instead, it should come up with a different way to approach this revolution.As the market changes, the economy also has to change. At this point, the direct impact of the fourth industrial revolution on Vietnam's labour market is still to be seen. If la-bour-intensive workers can receive proper training or those labour-intensive indus-tries receive support from the government or the private sector, then workers could move from such jobs and into data management or automation. Eventually, of course, headcounts will be reduced, but those employed in these industries at the engineering level will end up at a higher technical level.Among Asean countries, Singapore is currently leading in terms of technology appli-cation, just as South Korea and Japan are in Asia. Japan has only started to look into Industry 4.0, so I believe it will take another five to seven years for Vietnam to actually enter Industry 4.0.The fourth industrial revolution will not have a direct impact on real estate but will have an indirect impact. Applications in office projects, housing, and other projects with smartphone systems have been used by some investors in Vietnam. CBRE has also implemented a number of working-space 360 projects in the Asia-Pacific region and the world, which use a large number of digitisation technologies to create a better working environment for employees. In my opinion, shopping malls in the retail seg-ment will also use digital technology to assist people when they come to shop, eat, and use services. On a global scale, supermarkets are now equipped with self-checkout ma-chines, allowing customers to process their payment by themselves.Industry 4.0 is a long process and requires Vietnam's real estate sector learn from other countries around the world. However, we need to apply our own solutions based on our situation and what Vietnam has.CBRE always wants to apply advanced and trending technologies to guide and spread new ideas and trends in Vietnam's real estate market. It wants both investors and cus-tomers to have access to new technology. Internally speaking, CBRE has implemented working-space 360, applying modern automation technologies, including at CBRE Vi-etnam.Vietnam's real estate also faces many challenges from Industry 4.0. When digitising a system at the global level, it initially requires a dense process and heavy workload for each component, especially the IT component, due to the system sometimes being faulty when applied. It's also hard on human resources. We need human resources with sufficient knowledge and skills in technology.I think the first thing for Vietnam now is digital economic renovation. For example, the government needs to consider whether it permits Uber to officially operate in Vietnam or not, apply tax on Google or Facebook or not, or allow unmanned cars or not, and think about what supporting programmes are needed for startups to develop. There are many things the country needs to do but the most important thing is to be deter-mined. Vietnam is planning to build smart cities and, if successful, I believe the coun-


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try will be then be successful in approaching the fourth industrial revolution. In recent years, FPT has actively joined smart city development schemes, especially smart traffic and smart health, and has received positive signals from local authorities. I think the most important thing is that leaders have a vision about the digital economy. If busi-nesses do not change they will die. The question is whether it's sooner or later. Thus, the most important thing here is that enterprises use IT to create competitive advan-tages. In the future, real-time enterprises and digital enterprises will be more common. These types of enterprises will have superior levels of competitiveness. All customer feedback and personal needs will be provided by computational tools, not by human beings. Choosing the fourth industrial revolution means that Vietnam chooses chal-lenges, but it is also an opportunity to grow with advanced countries in the world.The challenge for Vietnamese enterprises is that Industry 4.0 is quite new. The revolu-tion is the convergence of three factors physical, digital, and biological as it is a combi-nation of data and the Internet of Things (IoT) based on artificial intelligence. Industry 4.0 will change the nature of many careers and the structure of industries. If we do not move quickly we will lag behind because this revolution is taking place rapidly. For example, most data has been static data in the past, but it is now replaced by dynamic data. So how can we take advantage of that to serve our customers well? The founda-tion of this is that we have to make technology become a core part of the organisation. Vietnamese enterprises are not in the habit of turning technology into part of their or-ganisational structure. In order to deal with this problem, we have to build an organi-sation based on data technology. In my view, Vietnam cannot benefit from the revolution in the short term. Whether it can in the medium term is a major question because it will depend on many factors.My enterprise has applied technology, big data, and artificial intelligence to build transportation systems that meet supply and demand perfectly at a price suitable to customers. Drivers also have more job opportunities. In the future, when Uber devel-ops self-driving vehicle technology, the human error rate will fall to the lowest level. Cities do not need many vehicles to meet needs. I think Industry 4.0 will affect the banking sector seriously. In the next ten years, changes in artificial intelligence and big data will lead to a revolution at banks.Vietnamese enterprises should determine their actual position to make sound prepa-rations for taking part in Industry 4.0. They should apply IT as a core function and build a large IT team to build special IT products, from which they can earn revenue.Industry 4.0 is an indispensable trend, and in the context of globalisation, the faster the race, the greater the competition. Even before globalisation with multilateral and bilat-eral trade agreements, Vietnam's goods and services could not compete with foreign counterparts due to backwards technology, small production scale, and a lack of ori-entation. Some groups, like Vinamilk and the TH Group, cannot boost the economy and micro and small and medium-sized enterprises. As a result, the fourth industrial revolution has come closer to globalisation, with greater challenges for small and me-dium-sized enterprises (SMEs) in Vietnam.Industry 4.0 connects virtual and real systems, IoT, and internet systems. Vietnamese enterprises should update their knowledge about these matters through training pro-grammes and carry out new technologies. Knowledge will help SMEs know what to do and identify what their strengths and weaknesses are and the orientation they must take in the next five to ten years. I would emphasize that preparation is important. Preparation in both knowledge and vision will help SMEs catch up with the trend, even if they only catch up with a small part and be successful.We can see that the fourth industrial revolution will present Vietnam with both oppor-tunities and challenges. Firstly, it is motivation for the country to restructure and move from small manufacturing with enterprises only exploiting resources or trading in real estate to get rich. Vietnam's growth model has reached its natural limitations. There-fore, if we do not improve, we will have to cope with crisis. In my opinion, the pressure from this revolution will encourage governments and enterprises in Vietnam to change institutions and policies to catch up with other economies in the world. Cheap


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labour as an advantage will gradually disappear as machines will replace many la-bour-intensive tasks.I don't think many enterprises in Vietnam clearly understand this fourth industrial revolution. They think it is quite complex and not real. However, the revolution can be applied in every sector, including agriculture, business, and banking.Many will be affected by the revolution, but the first will be intellectuals like doctors, lawyers, auditors, and workers in finance sector. For example, robots will welcome pa-tients at hospitals, replacing nurses and receptionists. Although the revolution will se-riously affect Vietnam's human resources, artificial intelligence cannot make decisions on company strategies or reconcile disputes.I think that Vietnam can actually be successful in the fourth industrial revolution al-though it's likely to be impacted a great deal, especially regarding the employment is-sue. But if it actively takes part in this revolution there will be fewer impacts on enterprises. They can still control their business activities; even more effectively thanks to automated technology. The number of Vietnamese using smartphones and technol-ogy is increasing rapidly and is an element that will help the country succeed in the revolution. If the government, enterprises, and people are determined, the benefits of the revolution can be accessed quickly. If not, the country may only benefit from 30 per cent of the revolution. The government therefore needs to have more policies to en-courage both enterprises and people to actively join the fourth industrial revolution. The way to approach it needs to be simplified. For example, many Vietnamese farmers are applying technology into cultivation. I think that is also a beginning for the revo-lution.In 2008, Garment 10's business activities faced a range of difficulties due to the global economic crisis but with a motto of "Doing What Others Do Not" we overcame the challenges. So, I think a pioneering spirit is very necessary to access the fourth indus-trial revolution. For textiles and garments, it is expected that 86 per cent of employees will be put out of work by automation. But there will still be some things that machines cannot do. If we stand outside of the fourth industrial revolution, we will die. Enter-prises should welcome it and find the best way to develop.http://vneconomictimes.com/article/business/change-is-coming

No escape 18/MAY/2017 INTELLASIA| VN ECONOMIC TIMES

The fourth industrial revolution is coming and Vietnamese enterprises simply must give it due regard.The Global Industry 4.0 Survey, the largest research of its kind and conducted last year by PricewaterhouseCoopers (PwC) on over 2,000 companies in nine major industrial sectors from 26 leading countries, revealed that companies expect Industry 4.0 to re-duce operational costs by 3.6 per cent per year while increasing efficiency by 4.1 per cent annually. Automation has already, in fact, been changing global manufacturing for some time and Vietnam has also been subject to its effects. The country's major cor-porations have been looking at applying advanced technologies and replacing their human workforce with machinery and robots in certain industries, to raise productiv-ity, reduce production time, and optimise labour costs. Isara Burintramart, Managing director of Reed Tradex, Asean's leading exhibition or-ganiser, underlined the increasing dynamism of Vietnam's industry. "Vietnam's man-ufacturing has been moving away from the traditional portfolio into higher value-added products," he said. "We have seen growth and changes in industries we serve throughout the past ten years, and the changes and the growth will certainly continue, especially now that we are all living in the digital age and are moving towards the 'In-dustry 4.0' era."Much concernThe development of the fourth industrial revolution, or Industry 4.0, along with in-creasing perfection in robotics production driving global industry towards robotics and automation, is the future but also a concern for many enterprises. A survey con-ducted by VET recently on more than 2,000 SMEs that are members of the Vietnam As-


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sociation of Small and Medium Enterprises, found that 85 per cent expressed concern with Industry 4.0. Of these, 55 per cent believed it would have a significant effect on Vietnam's economy, 23 per cent believed its impact would be moderate, 11 per cent be-lieved it would have no major influence, 10 per cent said it would have no impact, and the remaining 6 per cent had no idea.In terms of strategy, it is notable that up to 79 per cent of respondents said they haven't done anything to prepare for Industry 4.0. Fifty-five per cent said they have been seek-ing information or conducting research, while 19 per cent have set up plans and only 12 per cent have actually been implementing strategies.Sixty-seven per cent of respondents believed they would not be overly affected by In-dustry 4.0, 56 per cent believed their business sector would not be overly impacted, and 76 per cent said they didn't understand the nature of Industry 4.0. More than a half (54 per cent), said they didn't believe they needed to care about it. Nevertheless, anoth-er quick survey conducted at the CEO Forum held by VET last month revealed that 67 per cent of participants and enterprises present believe that Vietnam cannot catch up with this industrial revolution and only 33 per cent were optimistic about the pros-pects of keeping pace with it.According to Ngo Van Tuan, deputy Head of the National Assembly's Economic Committee, in terms of business manufacturing, Industry 4.0 allows enterprises a greater degree of freedom and flexibility in their production. The boundaries between traditional industries and between industrial and non-industrial appliances will fade. "Industry 4.0 will contribute to redefining the value chain in business models as a re-sult of a complex and connected manufacturing network," he said. "At the same time, the human workforce will require interdisciplinary thinking, social skills, and other technical skills."Preparation neededIndustry 4.0 is considered a transformation, not an overnight change, so enterprises need to actively prepare their resources. South Korea's Doosan Vina, one of the largest overseas manufacturing conglomerates, has been planning and preparing their human resources and production facilities for this revolution in recent years. In investing $300 million and employing 2,500 staff during its decade in Vietnam, the company has re-cruited and trained its staff and its equipment is state-of-the-art and the most ad-vanced in heavy industry.For example, Doosan has been integrating its manufacturing with Industry 4.0, with engineering and design software linked directly to massive multi million dollar robot-ic CNC machines. By connecting the design software straight to computer-driven cut-ting machines, precision is exact and perfectly mirrors design requirements. "Doosan Vina plans to continue seeking out the best solutions that are green, scalable, and cost effective to the company's needs for power and water," said Jung Yeon, CEO of Doosan Vina. "These are both critical factors in a country's economic development and quality of life. Our corporate R&D is leading the way with cutting edge technology for the industry and other sectors that will be focused on in the years ahead."Industry 4.0 has been drastically changing current business models as technology and consumer demand change rapidly in multiple dimensions, according to Masaaki Kobayashi, Managing director of Panasonic Vietnam. As one of the world's leading manufacturers of consumer electronics, "Panasonic sees the fourth industrial revolu-tion as bringing us great opportunities to develop and take a technological pioneering role in pursuit of a better world," he said."Kaisen", an economic term originating from Japan that means "continuous innova-tion", has spread to many countries in global industry with impressive results. It has been considered a business strategy and a spirit bringing success to Japanese people. Viewing Vietnam as a key market for investment, manufacturing, and R&D, Panason-ic's six plants in the country focus permanently on Kaisen activities in three regards: process automation, M2M connectivity, and manufacturing operations management.The company's target is to offer a variety of infrastructure solutions that shows the re-sults of its Industry 4.0 investment and proves its pioneering position in the industry.


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In human resources management, according to Kobayashi, focusing on investment in personnel by enhancing training activities can improve working skills and experience in order to create a dynamic business and manufacturing environment suitable for the transformation of Industry 4.0.According to Hyun Woo Bang, vice President of Samsung Vietnam, the transforma-tion in the global manufacturing industry through automation in processes, linking real and virtual systems, and converging advanced technologies, are common global trends and Vietnam is no exception. "The application of information technology in the country's key industries, supporting the development of heavy industry as well as oth-er industries, is also the method that most enterprises have been trying to put into practice in order to save time and costs," said Yang Kun Hsiang, general director of Vedan Vietnam.Opportunities vs. challengesVietnam's manufacturing industry has made significant changes over the last few years. The latest Cushman & Wakefield (C&W) Manufacturing Risk Index Report 2016 ranks Vietnam in second place in the global Pioneering Locations Index, behind only Costa Rica. It ranks the 30 "established" markets that are the largest by manufacturing output, as defined by the United Nations Conference for Trade and Investment (UNCTAD), and also covers the Top 10 pioneering nations, made up from those that currently do not have the largest output but are considered to have the most potential to mature.This indicates accelerating manufacturing production, increased output across all sec-tors, and rising new business, as well as markedly improved confidence among man-ufacturers about rising output. The Index is a reflection of improvements that Vietnam has made and continues to make to how business is conducted in the country. Partic-ularly in the manufacturing and industrial sectors, rather than seeing a hangover from the cancelled TPP, it sees legacy benefits building confidence for overseas investors and companies, according to Alex Crane, general manager of C&W Vietnam.However, "to be realistic, Vietnam's current manufacturing level is either at the Indus-try 2.0 or Industry 3.0 stage and relying on low-skilled jobs to drive industry has re-sulted in missing earlier technological waves due to a lack of awareness, demand, skills, infrastructure, or funding," said Burintramart from Reed Tradex. "There are also many other drivers that will assist manufacturers in becoming players in the Industry 4.0 era, and among drivers such as government, data analytics, and economics is hu-man resources."Vietnam has so far been competing internationally based on low labour costs. The gov-ernment has expressed a desire and need to move away from a labour-intensive econ-omy towards technology and value added areas. But unless there is real, implemented protection of intellectual property rights, investors are unlikely to bring their technol-ogy to Vietnam, and Vietnam will remain in the low labour cost trap, according to Vo Quang Hue, vice Chair of EuroCham Vietnam. "This is worrying for both European businesses and the Vietnamese government, because if those issues are not addressed, then foreign investors simply will not invest," he said.He also commented that low-cost labour has turned out to be less of a priority for for-eign companies when making a decision to enter Vietnam. In fact, more investors, es-pecially those of large-scale and with high-tech projects, are looking for qualified Vietnamese employees who can be key to their success in the growing market. It seems that a lack of capable employees has become a chronic issue, causing some companies to hesitate in making sizable investments in the country, he added.Meanwhile, Kobayashi said that Industry 4.0 can impact to a certain extent on the la-bour market, depending on preparations and training in adapting. "Automation and robots can replace manual jobs and a basic-skilled workforce, but it also generates high demand for skilled labour and talented leaders," he said. "This is a challenge but also an opportunity for investing in the development of skilled labour and fertile ground for breakthrough, creative thoughts. The fourth industrial revolution is not actually a competition between automation and humans."


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Nguyen Van Thu, Chair of the Vietnam Association of Mechanical Industry (VAMI), said that Industry 4.0 should start with small and simple steps but needs to be imple-mented immediately, and most important is investing in human resources. Manufac-turers should then boldly innovate technology with a ready state of mind and there must be tight cooperation to maximise the efficiency of enterprises and its workforce.http://vneconomictimes.com/article/business/no-escape

'Secret payments' and red tape holding back Vietnamese companies

18/MAY/2017 INTELLASIA| VNEXPRESS

An annual dialogue between Vietnam's top leaders and businesses started out as ex-pected: with a barrage of complaints.The Vietnamese government should simplify procedures and lower taxes and fees to help companies cut operating costs and avoid red tape, business representatives said at a meeting on Wednesday.Representatives from some 2,000 companies, 1,500 of them private firms, attended an annual meeting with prime minister Nguyen Xuan Phuc and cabinet members in Ha-noi, while 10,000 more across the country monitored the event remotely.The World Bank's business environment index last year ranked Vietnam at 82nd glo-bally, up nine places from the previous year, and many foreign business associations have also spoken positively about progress in Vietnam.Nguyen Van Than, chair of the Association of Small and Medium Enterprises, which represents 90 percent of businesses in Vietnam, said various taxes and fees, either of-ficial or unofficial, remain a heavy burden that hinders competition.Than said corrupt administrative procedures remain prevalent, and many businesses have to offer "secret payments".Nguyen Huu De, chair of the business association in Thanh Hoa Province, said local businesses often get held up with paperwork."Government officials go on holiday too often," De said, adding that the government needs talented people to accelerate economic reforms.Trade experts said reforms should include giving more space to private businesses.De, chair of a private transport and healthcare investor, said that state-owned compa-nies should stop stepping in areas that private companies can handle."We should avoid creating an economy in which state firms do the easy jobs and push the difficult ones to private firms," he said.Cabinet members acknowledge the existing difficulties faced by businesses.The trade and technology ministers told the conference that their agencies have sim-plified many regulations over the past year. However, businesses and some leading government officials said the business environment in Vietnam is still far from ideal.Planning and Investment minister Nguyen Chi Dung said doing business in Vietnam involves too many unnecessary expenses.For example, the cost of transporting a container over 125 kilometers (78 miles) from Hai Phong Port to Hanoi is three times more than from a port in China or South Korea, Dung said.He said taxes in Vietnam are higher than in all the biggest economies in Southeast Asia. The expense takes away 39 percent of the companies' profit, double the amount in Singapore.Vu Tien Loc, chair of the Vietnam Chamber of Commerce and Industry, said the costs of running a business in Vietnam are among the most expensive in the region, and pro-cedures are far too complicated.He said that contradictory regulations, sudden policy changes and rogue inspections need to be eliminated.Mai Tien Dung, Chair of the government Office, made the example of a business in the southern province of Dong Nai that was inspected three times in one month and an-other from a different province that was subject to 12 inspections in a year."Many regulations are interfering with business operations and violating their free-dom to do business," he said.Dung said the government office has received nearly 600 complaints and requests


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from businesses since it opened a communications channel last October. He said that according to those complaints, current policies and regulations are making life diffi-cult for businesses as some of them are unnecessary or unreasonable.He said support for small and medium enterprises in Vietnam is limited and many of them get caught in prolonged and complicated procedures regarding bank loans and land use.Pham Hong Hai, CEO of HSBC Vietnam, said that strong reforms can turn Vietnam into "the new tiger of Asia".Hai said Vietnam's economy has seen a wave of foreign investment and local business-es could be elbowed out if they keep relying on cheap labour to survive.For sustainable competition, businesses need to invest more in technology and the government should spend more on education to raise labour productivity, which is among the lowest in the region, he said.Prime minister Nguyen Xuan Phuc said the government will issue "important" deci-sions following the meeting.Concluding the five-hour meeting, Phuc said the government would create "a better and more competitive" business environment where all businesses will be treated equally, with no preference for state-owned enterprises."This is the year of cost-cutting for businesses," he said. "Low costs and low risks as well."As of April 20, around 612,000 companies were officially operating in Vietnam.More than 39,500 new firms registered in Vietnam in the first four months of this year, up 14 percent against the same period last year; and 11,500 firms resumed operations, up 1.9 percent, according to the Vietnam Chamber of Commerce and Industry.http://e.vnexpress.net/news/business/economy/secret-payments-and-red-tape-hold-ing-back-vietnamese-companies-3586157.html

Vietnam cleaning up its business environment survey


Notable improvements have been made to tax and admin procedures a year since the PM's first official meeting with local businesses.Vietnam has taken significant steps to improve its business environment since an offi-cial meeting between prime minister Nguyen Xuan Phuc and local companies in April last year.Around 96 percent of the more than 4,700 administrative procedures needed to con-duct business in Vietnam have been simplified, official government data showed.The government has also looked into 77 percent of the 1,100 proposals made by busi-nesses over the past year, according to the Ministry of Planning and Investment.In a new report on Vietnam's business environment, the American Chamber of Com-merce (AmCham) said the country is making itself more attractive to investors and up to 36 percent of surveyed US firms said they want to expand their operations in Viet-nam, compared to 21 percent in Thailand and 19 percent in Malaysia.In February, the Japan External Trade Organisation also revealed that more than 60 percent of the 640 Japanese firms it surveyed said they have plans to expand their busi-nesses in Vietnam.Over 75 percent of surveyed businesses expressed satisfaction with tax reforms in 2016, slightly up from 71 percent in 2014, the Vietnam Chamber of Commerce and In-dustry (VCCI) said last month.Regarding inspections, PM Phuc sent out an official letter on Tuesday asking relevant ministries and departments to avoid targeting the same companies, a problem that many firms have complained about.The PM's second meeting with local businesses is taking place on Wednesday in Ha-noi, and is expected to gather around 2,000 participants.As of April 20, around 612,000 companies were officially operating in Vietnam.More than 39,500 new firms registered in Vietnam in the first four months of this year, up 14 percent against the same period last year; and 11,500 firms resumed operations, up 1.9 percent, according to the VCCI.


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Vietnam's convenience store market not easy to exploit


While 7-Eleven expands its business in the Vietnamese retail market, Family Mart has decided to stop injecting more money into the chain in Vietnam because of losses.A survey by Kantar Worldpanel found that one-third of Vietnamese households now buy goods at small supermarkets and convenience stores.The retail model is favoured thanks to a lot of advantages. Convenience stores provide essential goods for people's daily use, while the products have clear origin.Besides, the stores are located in residential quarters, thus making it easy for people to seek to buy things they need. Most of the stores open for 16-24 hours a day.A report of Nielsen shows that convenience stores have boomed in the last three years.The growth rate of convenience stores and mini supermarkets in Vietnam is up to 200 percent. There were only 1,000 stores in 2012, while the figure had reached 2,000 by the end of 2015.Meanwhile, IGD, a market survey firm, has predicted that convenience store chains in Vietnam would see 2-digit growth rates in the next four years before reaching 37.4 per-cent by 2021.FamilyMart, B's mart, Circle K and Vinmart+ are the best known names in the Viet-namese market. However, the market is expected to become even more crowded with the arrival of the giant from Japan 7-Eleven, belonging to the Seven & I Holdings Group.Nikkei reported that 7-Eleven signed a franchise contract with Vietnam's Seven Sys-tem in mid-2015. The company plans to open 100 shops in Vietnam within three years and 1,000 shops within 10 years. The first store is expected to open in February 2018.The optimistic predictions about the Vietnamese market, plus 7-Eleven's strong deter-mination to expand its network in Vietnam, all seem to make people think that Viet-nam is a lucrative soil to cultivate.However, while 7-Eleven is injecting big money into Vietnam, Family Mart has decid-ed to stop pouring money into the market.Reuters reported that while Family Mart is making a profit in Taiwan and China, it is taking losses in Thailand, Vietnam and Indonesia. This has led to the chain's decision to stop injecting more money into Family Marts in Vietnam.FamilyMart is a big convenience store chain in its home country of Japan. By February 2015, the chain had stores in eight countries and territories, mostly in Asia, with 16,970 stores.In 2009, FamilyMart entered the Vietnamese market with the first store opening in De-cember.http://english.vietnamnet.vn/fms/business/178349/vietnam-s-convenience-store-mar-ket-not-easy-to-exploit.html

Region eyes global cashew cooperation


Binh Phuoc Province wants to strengthen cooperation with other provinces and cities as well as foreign countries to aid its industrial development, especially its cashew processing industry, according to its leader.Speaking at an international clients conference in the cashew industry held in the south-eastern province yesterday, Nguyen Van Tram, chair of its People's Committee, said the province had some 143,000 hectares under cashew, accounting for nearly 50 per cent of the country's total, which yield 150,000 tonnes a year.Earnings from cashew exports were worth $500 million last year, or nearly a third of the province's total export income, he said.The province is home to more than 200 enterprises and establishments involved in cashew processing, providing jobs for more than 50,000 people.Despite having the largest cashew cultivation area in the country, its products lack di-versification, and are mainly semi-processed products with low value addition.A majority of the processing firms are small and their technologies are not uniformly modern, which limits the competitiveness of the industry, he said.Climate change too has caused difficulties for the industry, he said.


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"Therefore, through this conference, Binh Phuoc calls for and wants cooperation with provinces and cities and international friends."Nguyen Anh Hoang, director of the local Department of Industry and Trade, said the province was seeking domestic and foreign partners to invest or cooperate in produc-ing more diversified products and expanding consumption both in domestic and for-eign markets."We are also calling for international support to help businesses in the province im-prove their management capacity in terms of nutrition and food safety to enable more cashew products from the province to penetrate your [foreign] markets."Improve qualityAttendees said to enable sustainable development of the sector, enterprises would need to pay more attention to product quality.Tjasse Pieter Dijksterhuis from the Netherlands's Decamerone BV said major custom-ers in Europe and the US were increasingly demanding mandatory quality testing, and so companies must ensure specification compliance when exporting.The US's food safety regulations are now stricter, with more inspections of suppliers' facilities, to shift the focus from responding to preventing contamination, according to delegates.Vu Thai Son, general director of Long Son Joint Stock Company, the world's second largest cashew exporter, said a new law in the US shifted inspection of imported goods from the US to production chains in countries exporting to the US."US importers also require their suppliers to ensure corporate social responsibility, and so Vietnamese cashew exporters should learn more about such regulations to en-sure that they meet requirements," he said.Nguyen Duc Thanh, chair of the Vietnam Cashew Association, said many cashew pro-ducers and processors, acknowledging that hygiene and food safety requirements are increasing in the global market, focused on producing clean cashew nuts and ensuring consistent quality."Enterprises have shifted from competition in prices to competition in quality, with many firms investing in modern technologies to add value to their products."Small and medium-sized firms could face financial difficulties in this regard and should cooperate with large firms, he said.Nguyen Anh Hoang, director of the province Department of Industry and Trade, said: "We have made great strides in improving product quality at all stages from planting to processing based on stringent hygiene and food safety standards."The French government is sponsoring the province's efforts to obtain geographical in-dication certification for Binh Phuoc Cashew.Hoang said this would be a good foundation for the province to promote its best cash-ew products around the world.Huynh Thi Hang, deputy chairwoman of the province People's Committee and head of the conference organisation board, said the event provided an opportunity for cash-ew farmers, processors and traders to exchange information and explore business op-portunities with local and foreign partners.The event would also help local cashew farmers and processors and exporters to get updated on global market information and understand customers' needs, she said.Vietnam exported 79,000 tonnes of cashew worth $735 million in the first four months of this year, a 13.1 per cent fall in volume but an increase of 7 per cent in value year-on-year, with the US, China and the Netherlands being the largest importers.http://bizhub.vn/news/region-eyes-global-cashew-cooperation_286185.html

Central coastal provinces eye sustainable shrimp farming


A conference was held in the central province of Ha Tinh on May 16 to seek ways to sustainably develop sand-based shrimp farming, for which the central coastal region holds huge potential.Minister of Agriculture and Rural Development Nguyen Xuan Cuong elaborated that these provinces own favourable conditions such as clean saltwater sources. Mean-


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while, they are also tourism destinations which are a good market for shrimp con-sumption.The region ranks second, behind the Mekong Delta, in terms of shrimp farming. Nota-bly, the north central provinces own great potential for rearing white-leg shrimps, he noted.The region has a large area of sand, between 12,000 14,600ha, on which shrimp farm-ing will make use of infertile soil here.The government has issued development directions for the shrimp sector, targeting export revenue of 8-10 billion USD by 2025.However, the central coastal provinces are also vulnerable to natural disasters like storms and flood which have affected local infrastructure, Cuong added.There are currently nearly 696,000ha of brackish water shrimp farming in Vietnam, with a total output of more than 657,000 tonnes. Shrimp products have been exported to 90 foreign markets, bringing home more than 3 billion USD each year.Fourteen central coastal provinces are farming shrimps in a total areas of more than 3,730ha, a strong increase from about 2,380ha in 2010, producing nearly 42,000 tonnes of shrimps. High productivity is recorded in Quang Nam, Quang Ngai, Binh Thuan and Ninh Thuan.However, sand-based shrimp farming in the central coastal region is carried out spon-taneously. Local irrigation systems haven't been built specifically for aquaculture, leading to the prevalence of shrimp diseases, according to the directorate of Water Re-sources.Minister Cuong asked the provinces to survey land that can be used for farming shrimps while ensuring environmental protection and the farming of other animals or crops.Meanwhile, businesses should connect with each another and with farmers to develop shrimp breeding and farming technology, share experience and boost sales. Relevant ministries and sectors need to have planning for shrimp farming areas and work out development solutions for this industry, he added.http://en.vietnamplus.vn/central-coastal-provinces-eye-sustainable-shrimp-farming/111861.vnp

M&A in real estate hikes early in year


The number of mergers and acquisitions in Vietnam's real estate market has increased considerably in the first four months of this year, and the figure is expected to see con-tinued growth throughout 2017.According to Su Ngoc Khuong, investment director of Savills Vietnam, mergers and acquisitions (M&A) by foreign investors continued along a strong development course in 2017, especially for investors hailing from China, Japan, Hong Kong, South Korea, and Singapore.VinaCapital's two investment funds, VinaCapital Vietnam Opportunity Fund Ltd (VOF) and VinaLand Ltd (VNL), sold their entire stake (18 and 54 per cent respective-ly) in Dai Phuoc Lotus a large-scale urban area project in the southern province of Dong Nai to Chinese real estate group China Fortune Land Development. The Dai Phuoc Lotus development consists of 332 high-end semi-detached and fully-detached villas. So far, around 200 villas in the first phase have been handed over to buyers.According to VinaCapital, the transactions recouped $16.5 million and $48.8 million for the two funds respectively.Another big fish, Novaland, acquired a 99.9 per cent stake ($85.5 million) of Gia Duc Real Estate Company's 181-hectare The Sunrise Bay development in the central city of Danang.The Sunrise Bay development will contain an international-standard urban resort, en-tertainment facilities, and retail trading centre when it opens post-2020. The Sunrise Bay will be developed under the same format as the Marine Bay Sands in Singapore, with leading global designers such as Moshe Safdie and Aedas taking part in the project's design.


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Singaporean developers are also making waves in Vietnam's real estate market. Kep-pel Land, through its subsidiary Krystal Investments Pte Ltd, has acquired an addi-tional 16 per cent stake in Southern Waterborne Transport Corporation, part of the Saigon Centre project in HCM City. Keppel Land has also signed a memorandum of understanding with Vietnam's State Capital Investment Corporation to collaborate on investment opportunities in Vietnam.Meanwhile, another Singaporean real estate developer, CapitaLand which has devel-oped more than 9,000 units in Hanoi and HCM City recently announced its plan to set up a new commercial fund to acquire more residential development sites.Vincent Wee, deputy CEO of CapitaLand Vietnam, said the firm has established a $500 million fund to invest in secured seed commercial properties, mainly in HCM City and Hanoi.Increased M&A in the market is evidence of high investor confidence and signals a new sustainable development cycle in the local property market, according to Khuong."With many high-potential projects available, M&A will continue to be a popular mod-el for investors to join the local market and carry out their goals in the development of the local property market," he added.Khuong said M&A would continue to be essential as the market develops, and inves-tors have to prove their skills, experience, and class to achieve cooperation opportuni-ties and make high-value deals."Domestic investors also play an important role in M&A and development coopera-tion. Vingroup, Van Thinh Phat, Novaland, and Sun Group became strategic investors when they acquired projects or land to develop property products," he said.http://www.vir.com.vn/ma-in-real-estate-hikes-early-in-year.html

Vietnamese, German businesses seek partnerships through digitalisation


Digitalisation would be an effective solution to connect Vietnamese and German busi-nesses together, heard a workshop in Berlin on May 16.Taking place within the framework of the ongoing Asia-Pacific Week, the event brought together representatives from 70 Vietnamese and German enterprises.Delegates at the workshop held that digitalisation is the main trend of the 21st century which generates both opportunities and challenges for economies in the era of the fourth industrial revolution.Addressing the event, Vietnamese Ambassador Doan Xuan Hung lauded the compre-hensive cooperation between the two countries over the past time.Vietnam and Germany are facing both challenges and opportunities after they estab-lished the strategic partnership for future six years ago, he said.However, the ambassador said, bilateral economic, investment and trade collaboration has still remained moderate and yet to match the two countries' potential.The Asia-Pacific Week took place from May 15-28 under theme of "Asia-Europe Dia-logue on Digitalisation."http://en.vietnamplus.vn/vietnamese-german-businesses-seek-partnerships-through-digitalisation/111868.vnp

Vietnamese, Indonesian localities boost partnership


Authorities of the southern province of Ba Ria-Vung Tau and Padang city of Indone-sia's West Sumatra province on May 17 inked an action programme to carry out the memorandum of understanding (MoU) signed in 2016.Accordingly, the 2017-2021 programme will focus on enhancing links across adminis-trative management, agriculture, fishery, trade, investment, education training, cul-ture, sports, and tourism.The two sides will share experience, knowledge, technology, and management skills and promote cultural exchanges to support each other for mutual development.Mayor of Padang city Mahyeldi Ansharullah said both localities have potential and strength to promote links in the above-mentioned fields and revealed that a represent-ative office of the Vietnamese locality will be established in Padang to introduce and


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promote its image and information to local people.At the signing ceremony, vice Chair of the provincial People's Committee Le Quoc Tuan asked relevant departments and sectors to foster links with Padang's authorities to effectively carry out the action programme.He expressed his hope that the connection will be expanded to other fields, thus boost-ing the friendship and mutual understanding and bringing benefit to the two localities' people.The MoU on establishing cooperation and partnership was signed between Ba Ria-Vung Tau and Padang on May 31, 2016, making them the first twin localities of Viet-nam and Indonesia.Ba Ria-Vung Tau province and Padang city established a relationship in 2012 and have similarities in culture and potential for cooperation in such fields as fishing, agricul-ture and tourism trades.The Vietnamese locality is situated in Vietnam's southern key economic zone and is a gateway to the East Sea for provinces in Vietnam's southeast region. The province is linked to HCM City and neighbouring provinces via roads, air routes, railways and waterways. Vung Tau city is the centre of the oil exploitation industry in southern Vi-etnam.Padang is West Sumatra province's capital and the largest city on the western coast of Sumatra and the fifth largest city in Indonesia with a population of more than one mil-lion. It covers a total area of 695 square kilometre, including 84 km of coastline. Besides fishing, Padang is known for gold, coffee, salt and garment.http://en.vietnamplus.vn/vietnamese-indonesian-localities-boost-partnership/111843.vnp

Oman wants to boost investment in Hanoi


Omani Ambassador to Vietnam Sultan bin Saif bin Hilal Al Mahrouqi asked for infor-mation on infrastructure projects in Hanoi for investment promotion during his meet-ing with the city mayor on May 16.Receiving Ambassador Sultan bin Saif bin Hilal Al Mahrouqi, Chair of the Hanoi Peo-ple's Committee Nguyen Duc Chung said he hopes the diplomat will help connect Omani investors with Vietnamese enterprises.He noted that the capital city is calling for investment in a range of infrastructure projects on transport, clean water supply, environmental sanitation and waste treat-ment, adding that these projects will be carried out in the next five years.Chung said Vietnam-Oman partnership will be included in the agenda of a conference on investment and development in Hanoi scheduled for June. He invited the diplomat to take part in the event.The Omani ambassador accepted the invitation and affirmed that he will push for Om-ani investments in Hanoi through the Oman Chamber of Commerce and Industry.He stressed the potential of the Omani market and suggested Vietnamese firms export more tourism and food products to the Middle East country.http://en.vietnamplus.vn/oman-wants-to-boost-investment-in-hanoi/111823.vnp

Major travel firms forecast strong summer tour bookings


Big travel companies in HCM City have projected a 20 percent increase in summer tour bookings while smaller firms expect a smaller rise of 5-10 percent in tour sales.Major tour operators Saigontourist, Fiditour and Vietravel have reported good tour sales though the summer has just set in. Tourism businesses have prepared numerous tour programmes with tens of billions of dong set aside for summer travel season pro-motion programmes.Doan Thi Thanh Tra, marketing and communications director at Saigontourist Travel Service Company, said her firm has seen a sharp pickup in tour sales since the start of the summer and that 65 percent of tours have been sold to individual tourists.However, Tran The Dung, deputy director of Young Generation Travel Company, a small tour operator, complained about slow tour sales to individual tourists. Custom-


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ers prefer large travel companies that have generous promotion programmes.Small tourism enterprises have to find niche markets and tours to unpopular destina-tions such as the northeast and northwest of the country, Dung added.Summer tours to seaside destinations are as in high demand as usual.Tour operators offer a variety of promotion programmes to early and group bookings. Some companies give a discount of VND150,000-250,000 (US$6.61-11.02) a person to groups of three to 10 that book domestic tours by air and VND400,000 a person for Ja-pan tours. Meanwhile, there is a 5-7 percent discount for groups of four to six after air-fares are deducted. Those customers buying tours two months before departure also get 5-7 percent off.Prices of summer tours are stable this year. "We offer more than 300 domestic and in-ternational tour programmes in the summer this year at stable prices. Tour buyers have edged up by 15 percent over the same period last year," said Tran Thi Bao Thu, marketing and communications director of Fiditour.http://english.thesaigontimes.vn/53984/-Major-travel-firms-forecast-strong-summer-tour-bookings.html

Eyes on the smartphone prize


Who, if anyone, is in a position to take over third place in Vietnam's smartphone mar-ket from Apple this year?Despite the problems besetting the Galaxy Note 7 and its batteries, Samsung products remain popular in Vietnam, with smartphone sales at impressive levels in 2016. OPPO, meanwhile, has spent the most on marketing and advertising to increase its brand identity among Vietnamese consumers. Aware of the rising consumption in the coun-try, the two have the most number of smartphones being sold in the market. So who will make up the Top 3 in Vietnam's competitive smartphone market this year?Best-sellersMore than 14 million smartphones were sold in Vietnam last year, according to IDC Vietnam. Samsung led in terms of volume, with a market share of 28 per cent, followed by OPPO with 25 per cent then Apple with 7 per cent. Samsung and OPPO have been locked in competition over recent years to secure even higher market shares. The com-petition really heated up last September, when Samsung officially launched the Gal-axy J7 prime to compete directly with the OPPO F1s in the mid-end segment of around VND6 million ($265).Samsung, OPPO, and Apple are the Top 3 best-selling smartphones at thegioididong and FPT Shop. The Galaxy J7 prime and OPPO F1s contributed significantly to growth in sales at the two major mobile retailers in 2016. "Vietnamese consumers are persuad-ed by the trendy functions of the two products, including selfie cameras, fingerprint sensors, fashionable design, and competitive prices," said Tran Nguyen Truc, Head of Telecom & Mobility Category at the Mobile World JSC (MWG).The Samsung Galaxy J2 prime and J5 prime and the OPPO A39 and A37 also sell well at mobile retailers. The two brands have constantly retained their leading positions in recent years, according to Vo Le Tam Thanh, an analyst at IDC Vietnam. Asian smart-phone manufacturers are quite flexible in meeting demand among young consumers. As low prices make owning a smartphone quite easy, updating drives most purchases. As such, quality functions such as selfie cameras, fingerprint sensors and a good con-figuration are now more important, though price still plays a role.OPPO failed with its Find 7, launched in 2014, as smartphones in the high-end segment of more than VND7 million ($310) were not the choice of the majority of Vietnamese consumers. It then focused on the mid-end segment. Smartphones costing less than VND7 million accounted for 83 per cent of all smartphones sold in 2016, according to figures from GfK, though Vietnamese consumers now spend more on smartphones than previously. "Samsung and Chinese smartphone manufacturers like OPPO, Vivo, and Huawei realised the trend when moving from producing low-cost products to mid-cost ones," said Thanh.Quality and functions are only one part of success, however, as marketing campaigns


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are also a decisive factor. Samsung and OPPO have poured a great deal into advertis-ing on TV during prime time. They have also used images of rising Vietnamese stars like Son Tung M-TP, Issac, Noo Phuoc Thinh, and Ho Ngoc Ha in advertising their products. OPPO has sponsored a number of game shows on TV and increased its pro-file in mobile retail stores and mom & pop stores in rural areas.In third position in 2016, Apple is a brand that doesn't need any marketing campaigns in Vietnam. Though being launched in 2013, the iPhone 5s is still is the hottest smart-phone on the market, according to Truc from MWG.Apple is now paying more attention to Vietnam, opening an office in HCM City at the end of 2015. In April, its legal representative in the country, VOTRA, asked mobile stores to cease using the Apple trademark without the company's permission. The number of iPhones sold unofficially exceeds official sales in Vietnam. "Figures from IDC Vietnam exclude iPhone products sold unofficially," said Thanh. "Its market share may be much higher than 7 per cent." The legal move is to support its authorised stores and protects consumer rights.Third up for grabsThe mid-end segment will continue to be the target of most smartphone manufacturers for the time being, with competition heating up as a result. "2017 continues to see com-petition among the three biggest names Samsung, OPPO, and Apple," Thanh said. "Samsung and OPPO will be Top 2 but they will struggle to retain their positions over the long term because the market is constantly changing."Samsung defines developing diverse products in all the segments as a core business strategy. Nguyen Tri Thong, a spokesperson at Samsung Vina, said that Vietnam holds much potential. "Samsung will constantly innovate its products, improve the quality of its services, and professionalise its marketing and advertising activities," he said. "We are confident of staying No.1 in all segments."The fight for third place is where the competition is at its most fierce. As Thanh noted, however, Apple's recent moves show that it is paying more interest to the country. Ap-ple's partners in Vietnam are working effectively, it saw positive growth in 2016, and its efforts to strictly manage its trademark in the country prove it has its eye on retain-ing third place, according to Thanh.Meanwhile, a Chinese smartphone brand, Xiaomi, has joined Vietnam's smartphone market through Vietnamese technology distributor Digiworld. The brand is not as powerful in China as it was five years ago, when its strategy was to focus on products with cheap prices and strong configuration. While one of the smartphones it has launched in Vietnam, the Redmi Note 4, is in the busiest price segment of VND7 mil-lion ($310), the Mi MIX is in the high-end segment, at VND16.9 million ($740). It has ignored the low-cost segment, as it has successfully done in its home market.The brand announced it will bring both affordable and premium smartphones to Viet-nam and throw out a challenge to Samsung and Apple. "There is an opportunity for Xiaomi to gain third place," Thanh agrees. "But it is quite small and Vietnam's smart-phone market is very competitive." Xiaomi, though, has faith in its products. A repre-sentative from the company told a press conference in March that its products will be distributed at 6,000 points of sales around the country. Truc from MWG said that the response to Xiaomi's products has been positive thanks to their good design and func-tions, as well as competitive prices. "It has potential if it commits to long-term invest-ment in Vietnam," he said.Nokia has returned to the mobile phone market both in Vietnam and the world, intro-ducing new feature phones and smartphones last year. Its strategy is to develop the Android system, after failing with the Windows Phone system. Reclaiming its former glory will require a lot of effort, Thanh said, though its name remains well-known in Vietnam and it actually led the feature phone market in 2016. FPT Shop continues to distribute its products, Nguyen Viet Anh, deputy CEO of FPT Retail, said. Meanwhile, Truc said that Nokia's products need more personalising and better pricing and mar-keting, but it could indeed change the mobile phone market. "Nokia securing third place would depend on its new products and human resources in Vietnam," Thanh


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said. 2016 was a successful year for Huawei, another Chinese brand that is now in third place in the global smartphone market. Like Samsung and OPPO, it poured a lot of money into marketing campaigns last year in Vietnam and has announced it will soon-er or later seize third place. "Huawei Vietnam follows the global strategic goals," said Nguyen Viet Hoang, deputy director of Huawei Consumer Business Group (CBG) in Vietnam. "We pursue a customer-centric strategy by making quality, well-designed products and will continue to expand our distribution channels this year." The mid- and high-end segments are the focus of the brand in the time to come, and its products will be innovated with new technology and leading technology.An estimated 15 million smartphones will be sold in Vietnam this year, according to IDC Vietnam. While the market will indeed see tough competition in mid-end smart-phones, as Truc said, there will also be growth in the near high-end segment, with prices from VND8 million ($350) to VND10 million ($440). High-end design, good cameras and batteries, quick recharging, and greater security are the criteria Vietnam-ese consumers will base purchasing decisions on this year. Smartphone manufacturers eyeing the Top 3 must invest more in products as well as in marketing and branding, Thanh believes.http://vneconomictimes.com/article/business/eyes-on-the-smartphone-prize

BIZ NEWS

Business Briefs May 18, 2017

18/MAY/2017 INTELLASIA |

* Phat Dat Real Estate Development Company (PDR) has decided to issue over 20 mil-lion shares to pay dividend for shareholders. In the first quarter of 2017, the enterprise obtained nearly VND205 billion in revenue and VND45 billion in after-tax profit, surg-ing 107 percent and 79 percent over the same period last year, due to the hand over of apartments and offices of The EverRich Infinity project in HCM City's District 5.* Thu Due Housing Development Corporation (TDH) will issue over 14.8 million shares for bonus giving at a 5-for-1 ratio on the record date of Iune 2. The issuance will help NTP raise its registered capital to VND890 billion.* Hoang Quan Consulting- Trading Service Real Estate Corporation (HQC) targets a net profit ofVND200 billion in 2017, up 10-foldagainst the previous year, while its revenue is expected to increase 75 percent to VND2 trillion. The firm plans to earn a net profit ofVND3 trillion in 2018 and VND6 trillion in 2020. In the first quarter of this year, HQC made a consolidated net profit of VND20.8 billion, down 59.7 percent year-on-year, while revenue decreased23.6 percent to VND312.3 billion, said Viet Capital Securities Company.* Viet Capital Securities Company (VDS) is going to issue bonds worth VND300 billion this month to improve its brokerage activities andmeet capital demand for margin trading service. The enterprise will offer 30,000 unse-cured unconvertible bonds, which have the face value ofVND10 million each and a tenor of two years, to less than 100 investors via a private placement in many stages. Bond yields will depend on businesssituation of the enterprise in each stage but will be no higher than the average medi-um-term deposit rate of BIDV and VietinBank plus 4.5 percent per annum.* Nguyen 1hi Tuyet, a board member and deputy general director ofIB Securities Com-pany (VIX), has registered to buy four millionVIX shares, or a 5.7 percent stake in the enterprise within around one month starting from today. If the purchase is done, she will become the thirdlargest shareholder at VIX after FTG Vietnam Joint Stock Company with a 21.38 per-cent stake and Pyn Elite Fund with a 14.28 percent stake.

Market flat but turnover soars


The local stock market moved sideways for the second straight session on May 16 but turnover surged to a one-month high due to strong cash flow into the real estate sector.With decliners slightly outnumbering advancers by 147 to 120, the VN Index lost a

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SVietnam finance & business 18 May 2017

marginal 0.32 point, or 0.04%, at 725.03. Large caps were key laggards with SAB, CTG, VCB, HPG and VNM pushing the VN Index down nearly 0.38%, in which banking and finance stocks CTG, VCB, STB and BVH collectively took away 0.15 percent from the main index.Trading volume on the HCM City market hit 294.2 million shares worth VND6 trillion, marking the highest since April 21. The put-through market saw 10.2 million shares worth VND305 billion traded, including notable deals of 3.69 million ITA shares worth VND13 billion, one million KBC shares worth VND16.3 billion and one million QCG shares worth VND16.5 billion.The real estate sector kept attracting investors. QCG went up to the ceiling price for the 13th straight session after announcing its debt solvency, jumping from VND4,000 to VND16,200 a share.HQC, SCR, ITA, CLG and NVT also hit the ceiling prices, in which HQC reported matching volume at 26.3 million shares, SCR nearly 14.5 million shares and ITA over 15 million shares. CEE shot up to the upper limit for the second day after debuting on the HCM City market on Monday, closing at VND28,600 per share on volume of 2.8 million shares.FLC also made a nice gain and took the lead for liquidity with 32.3 million shares ex-changed. ROS advanced slightly at VND160,300 a share on volume of 9.4 million shares.Speculative cash flow also ran into mid, small and micro caps like TCH, SBV, DTA and KSA. Notably, TCH hit the ceiling price with over 3.3 million shares exchanged as the stock is likely to be added to MSCI Frontier Markets Small Cap Indexes and the com-pany is expected to announce positive business outlook.Foreigners net bought VIC shares after net selling the stock for a long time, driving the stock up 1.5 percent at VND41,500 per share. PLX, MSN and GAS also increased, in which PLX added 4.9 percent at VND51,100 on volume of 3.6 million shares.The Hanoi market gained ground for the third straight session as most pillar stocks ad-vanced. The HNX-Index rose 0.18 point, or 0.19%, at 91.28, with turnover soaring to VND827.6 billion.Among banking stocks, SHB climbed 1.5 percent to VND6,800 a share with 19.6 mil-lion shares traded while ACB increased 1. percent at VND23,900 per share on volume of over four million shares. Large caps CEO, VCG and HUT reported high trading vol-ume at around four million shares but the stocks still closed in the red.http://english.thesaigontimes.vn/53993/-Market-flat-but-turnover-soars.html

Stocks trade lower on profit-taking, oil prices


Shares ended negative on both local markets on Wednesday morning as investors sought profits from recent gains.The benchmark VN Index on the HCM Stock Exchange closed at 725.25 points, slightly up from Tuesday's 725.03 points.The HNX Index on the Hanoi Stock Exchange dropped 0.27 per cent to end at 91.03 points. The northern market index rallied a total of 1.5 per cent in the previous three days.Market trading liquidity was high with more than 158.8 million shares being ex-changed, worth VND2.92 trillion (US$129.9 million).Following the recent gains, brokerages warned investors to be cautious, expecting some would try offloading stocks that had made strong gains, such as property devel-opers.The real estate sector was pushed down by FLC Group (FLC), Hoang Quan Consult-ing-Trading-Service Real Estate (HQC), Vingroup (VIC) and Tan Tao Investment and Industry (ITA).FLC fell 0.6 per cent, HQC slipped 2.3 per cent, VIC inched down 0.1 per cent and ITA lost 2.7 per cent.In addition, lower oil prices in global trading pulled energy stocks down, including PetroVietnam Gas (GAS), PetroVietnam Coating (PVB) and PetroVietnam Technical


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Services (PVS).The afternoon session starts at 1pm.http://bizhub.vn/markets/stocks-trade-lower-on-profit-taking-oil-prices_286197.html

Plastic company leaders to sell 27pct ownership


The chair and general director of An Phat Plastic and Green Environment Joint Stock Company have announced the sale of over 15 million shares, equivalent to 27 per cent of their ownership.Pham Anh Duong, chair of the company registered to sell more than 9.26 million shares, accounting for 16.26 per cent of the ownership.Nguyen Le Trung, general director, will sell his entire 6.22 million shares, equivalent to 10.92 per cent ownership.Both transactions are expected to take place from May 22 to June 20 through an agree-ment.In the first quarter of this year, An Phat recorded total revenue of VND731 billion (US$32.2 million) and after-tax profit of VND66 billion, up 79.6 per cent and 131.6 per cent, respectively, against the same period last year.The company is set a target to reach VND888 billion in revenue and VND50 billion in after-tax profit for the second quarter.http://bizhub.vn/markets/plastic-company-leaders-to-sell-27-ownership_286216.html

TLG to pay off residue dividend


Thien Long Group (TLG) held its 2017 annual shareholders' meeting yesterday, an-nouncing a 15 per cent residue dividend from 2016 would be dispersed this year.The company's dividend for 2017 would amount to 20 per cent of total earnings, while in 2016 the figure was 30 per cent in cash. Fifteen per cent were paid last year, leaving the rest to be paid in July 2017.TLG also reported its business plan this year to include an expected revenue of VND2.45 trillion ($109.5 million), post tax income of VND265 billion ($11.84 million), up by 13 and 10 per cent compared to 2016, respectively.The board approved TLG's plan to issue more than 11.4 million shares with a 10:3 ratio to increase charter capital from VND383 billion to VND498 billion ($17.11 million to $22.25 million) in the third quarter of 2017.This year meeting also announced TLG's plan to increase foreign investors' percentage of ownership from 49 per cent to 100 per cent.http://bizhub.vn/markets/tlg-to-pay-off-residue-dividend_286190.html

US firms encouraged to join smart city project


The HCM City government has said it will support US corporations to participate in the process of developing the city into a smart one.At a meeting with city vice chair Tran Vinh Tuyen on May 15, Diane Farrell, deputy assistant secretary for Asia of the US Department of Commerce, expressed interest in the smart city development plan.Tuyen said the city had drawn up a master plan for smart city development until 2025 and even 2030 and would pass it around in July to collect input from experts and busi-nesses.The plan will focus on building e-government, setting up an open data centre and pro-viding public facilities and services, thus improving the quality of services for the pub-lic, managing the city in a more efficient way, and contributing to sustainable socio-economic development and environmental protection.The city will create favourable conditions for US companies to learn about the projects they are interested in.Last year, HCM City chair Nguyen Thanh Phong visited the US to sound out oppor-tunities for cooperation in the smart city development field.http://english.thesaigontimes.vn/53991/-US-firms-encouraged-to-join-smart-city-project.html


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HCM City backs Tan Son Nhat airport expansion


The government of HCM City on May 16 wrote to the Ministry of Transport throwing its weight behind a major plan to revise up the capacity of Tan Son Nhat International Airport to 45 million passengers a year.The city approved of construction of more taxiways, Terminal T4 with an annual ca-pacity of 15 million passengers, more aircraft parking slots and a technical area north of the airport.As the current roads around the airport will not be able to meet a pickup in vehicle traf-fic which will be triggered by an increase in Tan Son Nhat's passenger handling capac-ity, the city requested the Ministry of Transport to seek government approval for an adjustment of the urban and traffic planning in the area around the airport. The revi-sion will ensure that the airport would be efficiently operated, traffic congestion re-duced and impacts on the existing residential areas minimised.The airport is currently designed to handle 25 million passengers a year but the actual figure last year surpassed 32.5 million passengers.http://english.thesaigontimes.vn/53981/HCM City-backs-Tan-Son-Nhat-airport-ex-pansion.html

PV Gas licensed to build $1.27 billion gas pipeline


The Ministry of Planning and Investment has awarded a license to PetroVietnam Gas Joint Stock Corporation (PV Gas) and its foreign partners to build a natural gas pipe-line worth $1.27 billion.The pipeline would be used to transport natural gas from Block B-O Mon off the coast of the Mekong Delta province of Kien Giang to the shore.PV Gas and its two foreign partners, Japan's Mitsui Oil Exploration Co Ltd and Thai-land's PTT Exploration and Production Public Co Ltd, will develop the project.When in place, the pipeline would deliver around 20.3 million cubic meters of natural gas a day to fuel two power plants with a combined capacity of 3,660 MW.In addition to supplying gas for the power plants, the pipeline will be used to transport surplus gas to the Gas-Electricity-Fertiliser Industrial Park in the southernmost prov-ince of Ca Mau, and household users in the Mekong Delta.PV Gas said this is one of the largest gas pipelines in the country with a total length of 400 kilometers, with around 246 kilometers of it to be built offshore and the remainder to pass through Can Tho, Hau Giang, Kien Giang, Bac Lieu, and Ca Mau provinces.The project will save a large sum of foreign currency for importing fuel and leave a positive impact on the environment as gas is a clean source of energy.PV Gas has unveiled its 2017 business plan in which it will invest over $2 billion in ma-jor projects.PV Gas supplies gas for thermal power plants which are responsible for 30 percent of the nation's electricity output, and for fertiliser facilities that meet 70 percent of total urea fertiliser demand in the country.This year the firm looks to carry around 9.6 billion cubic meters of gas ashore, down from 10 billion cubic meters against 2016. The low oil price has led oil firms to slash pumping, resulting in a decline in gas output.The average oil price stood at $43-45 a barrel last year, much lower than in previous years and accounting for 85 percent of the 2015 average. However, PV Gas managed to obtain a staggering VND60 trillion in revenue and VND7.19 trillion in after-tax prof-it last year.http://english.thesaigontimes.vn/53982/-PV-Gas-licensed-to-build-US$127 billion-gas-pipeline.html

Zalora, Robins-Fashion and Beauty merge


Vietnam's leading online shopping website Zalora and Robins Fashion and Beauty chain stores, both belonging to Central Group Vietnam, have announced they will merge to give customers the best shopping experience.Zalora is the largest fashion shopping website in Vietnam, offering collections from


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more than 700 well-known fashion brands in Vietnam and around the world.According to a release from Zalora, after five years in Vietnam it has been recognised as a leader with a professional stylist team, excellent customer service and attractive promotion programmes from a variety of brands and offering a reliable and fast e-commerce experience.Robins Fashion and Beauty chain stores, with nearly 200 brands in seven different cat-egories, is a popular shopping destination for many families in Hanoi and HCM City.Understanding that consumers are always eager to find more convenient and selective online and offline shopping experiences, starting in May this year the two brands have teamed up to maximise their strengths.From May 17 Zalora will carry the Robins name.Zalora has reasserted its core activities will remain that of a leading online shopping platform through a current list of fashion brands, attractive promotions and profes-sional customer service team.This can be considered the first step in Zalora Vietnam and Robins sharing an ambition of becoming the ultimate retail destination in Vietnam, the release says.http://bizhub.vn/news/zalora-robins-fashion-and-beauty-merge_286180.html

Local firm to make unbaked construction materials from ashes, cinders


Mai Xanh Investment Joint Stock Company has got an investment certificate from the south-central province of Binh Thuan to build a factory to produce unbaked construc-tion materials from ashes and cinders.The company will spend some VND450 billion on the facility in Vinh Tan Commune, Tuy Phong District, according to the provincial Department of Planning and Invest-ment.Initially, the factory would use 1.3-1.7 million tonnes of ashes and cinders from the Vinh Tan power centre in the province to produce more than one billion unbaked bricks a year. The firm will work towards making cement and concrete in the long run.Cao Hoang Dieu, the company's deputy director, told the Daily that Mai Xanh com-mits to use all ashes and cinders from Vinh Tan 2 Thermal Power Plant to make un-baked building materials.The company are working on the factory project, he noted.This may be good news for thousands of local households as ashes and cinders from the coal-fired power plant frequently blanket their neighbourhood, disrupting the lives of local residents and causing serious environmental pollution.In mid-2016, Duyen Hai Thermal Power Company in Duyen Hai District, Tra Vinh Province inked a contract to sell coal ashes and cinders at Duyen Hai 1 Thermal Power Plant to joint venture Viet Long-Hoang Quy to make additives for cement and un-baked bricks.The deal will help reduce the amount of coal ashes and cinders discharged into the en-vironment as Duyen Hai 1 alone consumes more than three million tonnes of coal and discharges around one million tonnes of ashes and cinders a year.Coal-fired power plants nationwide use around 20 million tonnes of coal a year and discharge a total of three million tonnes of ashes and cinders, according to environ-mentalists.Most ashes and cinders have been buried within the premises of the power stations or transported to other places, instead of being recycled, thus leaving harmful effects on the environment.Around 80 thermal power plants in major electricity generation centers will be up and running across the country such as Duyen Hai, Long Phu, Song Hau, Van Phong, Vinh Tan, Quang Tri, Vung Ang, Quang Trach, Nghi Son, Nam Dinh, Thai Binh and Hai Duong, according to the master zoning plan for national power development in 2015-2030.This means there is an urgent need for developing unbaked construction material fac-tories to consume ashes and cinders from these coal-fueled thermal power plants.


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Mobiistar unveils 2 'selfie' smart phones


Vietnamese mobile phone maker Mobiistar will introduce by the end of this month a pair of "selfie" smart phones, Zumbo S2 and Zumbo J2, targeting young users.They will have 13 megapixel cameras both in the front and back along with applica-tions to improve the quality of images that are only available in expensive phones.They will also have improved quality of video calling in line with market trends.Zumbo S2 will have a 5.5-inch full-HD screen, 3GB of RAM and a four-core 64 bit chipset, while J2 will have a 5.2-inch standard-HD screen and 2GB of RAM.The S2 will be priced at VND3.8 million (US$167), and the J2 at VND2.8 million ($123).http://bizhub.vn/tech/mobiistar-unveils-2-selfie-smart-phones_286220.html

Chinese low-cost airline opens air route to HCM City


Chinese low-cost carrier Spring Airlines on May 16 introduced its direct service be-tween Shanghai and HCM City with four weekly flights.Zhang Wu An, vice president of Spring Airlines, said Shanghai-HCM City flights, which were first launched on April 28, are operated on Mondays, Wednesdays, Fri-days and Saturdays using Airbus A320 aircraft.Seat occupancy has been high, especially on International Labour Day (May 1), he said, adding the airline is offering some promotions for Vietnamese passengers.Spring provides its customers with services such as bus tours around Shanghai and to neighbouring areas, and cooperates with partner railway firms to provide fliers from HCM City to Shanghai with free express train services to 11 cities including Suzhou, Wuxi, Hangzhou and Ningbo.The carrier is a subsidiary of Spring Tour, a major travel firm in China. With about 70 aircraft and more than 180 domestic and international routes, the airline transported nearly 15 million passengers last year.On May 12, during Vietnamese President Tran Dai Quang's State visit to China, Viet-namese tour operator Vietravel signed a memorandum of understanding with Spring Tour to increase the number of tourists between the two sides.Tran Doan The Duy, deputy general director of Vietravel, said the deal would allow the two sides to attract customers. Vietravel now arranges tour programmes for Chi-nese tourists through the arrangements of Spring Tour and offers competitive tour packages for Vietnamese customers travelling to China on Spring Airlines' flights."Initially, China package tours for Vietnamese customers flying with Spring Airlines will be 15-20 percent cheaper than normal ones," Duy said.http://english.thesaigontimes.vn/53980/-Chinese-low-cost-airline-opens-air-route-to-HCM City.html

Vinamilk imports more than 2,000 cows from the US


The Vietnam Dairy Products Joint Stock Company (Vinamilk) has imported from the US a further 2,000 Holstein Friesian cows, which are known as the world's highest-pro-duction dairy animals.The cows have been carefully selected and undergone strict quarantine and health checks by experts prior to their arrival in Vietnam and sent to Vinamilk farm in south-western Tay Ninh province.As planned, Vinamilk will increase the herd of cows at the farm from nearly 5,000 to 8,000 heads in the near future.According to a Vinamilk representative, the company sets an important goal in its de-velopment strategy to have fresh milk in place. With more investment, the farms will become a source of raw milk, helping the company improve the quality of products and increase the rate of industry localisation.Vinamilk plans to increase its total herd of cows to around 160,000 heads and 200,000 heads by 2020 to get 1,500-1,800 tonnes of raw milk a day in the next three years.Since 2012, the company has spent billions of Vietnam Dong on importing more than 8,000 cows from Australia, New Zealand and the US.Vinamilk is Vietnam's largest dairy company and among the world's top 50. Its prod-


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ucts have been exported to 43 countries, including the US, Japan, Middle East, Thai-land and the Philippines. It now owns 10 farms and 13 factories in Vietnam and three factories in the US, New Zealand and Cambodia.http://english.vov.vn/economy/vinamilk-imports-more-than-2000-cows-from-the-us-349681.vov

Misumi automates production


In recent years, automation has revolutionised the way products are manufactured and assembled, shifting the production paradigm to a more mechanical approach. general director of Misumi Vietnam Co. Ltd,Yasuo Shimokura, spoke with VIR's Phuong Thu about industrial production trends and trade in Vietnam.As the leading manufacturer and distributor of standard components for factory auto-mation, what is your company's strategy in Vietnam?Misumi is a one-stop solution provider for various manufacturing needs. We are proud to be the leading manufacturer and distributor of standard components for fac-tory automation, press dies, and plastic moulds. Furthermore, we have expanded our scope to include electronics, tools, maintenance and repair, and operational consuma-bles. Our firm supplies more than 10 million quality products to our customers world-wide.To meet the growing demand for Misumi products in the region, Misumi Vietnam Co., Ltd was established in July 2016. This has allowed us to provide better services to all of our valued customers in Vietnam, enabling them to enjoy shortened lead times in receiving our products for operational designs, machine assembly, and maintenance.At Misumi, we support manufacturing operations by delivering high quality and low cost products and services in a reliable and timely fashion. We strive for continuous improvements in our offerings to better provide for our customer's ever-changing needs. Misumi Vietnam aims to assist firms in the manufacturing sector, with an em-phasis on Japanese and Korean companies, by leveraging our existing business rela-tionships in Japan and Korea.In the longer term, we intend to penetrate local manufacturing firms to provide solu-tions for businesses of all shapes and sizes. I believe Misumi Vietnam can contribute to the further development of supporting industries in Vietnam by providing high quality products with shortened lead times, transparent and reasonable prices, and of-fering a convenient purchasing experience.What is your view on industrial production and trade in Vietnam, especially in field of factory automation?I believe that the demand for factory automation will increase dramatically in the com-ing decade. Two key factors support this view.One factor is that foreign direct investment (FDI) is at a healthy level. In 2016, it reached $15.6 billion, and what is favourable for us is that a large portion of this is con-tributed by major manufacturers that produce mobile phones, electrical machinery, and other types of electronic devices.The second factor is the rising cost of labour in Vietnam. Labour costs increase 7-10 per cent every year in Vietnam, which affects companies that are vulnerable to global com-petition. Many corporate executives and managers mention lower labour costs, higher localisation, and increased automation as their three main targets for boosting long-term results.Increased FDI and higher labour costs support our vision of a dramatic shift towards factory automation in the next decade.Could you share with us your views on the current trends in investment, including op-portunities for Vietnamese manufacturers within Asean and throughout the globe?Good or bad, we cannot avoid global competition any longer. Thus, I believe any com-pany that wishes to succeed must have a rapid and thorough response to global com-petition and Vietnam is no exception.I believe that Misumi Vietnam can be a tool for the Vietnamese manufacturing indus-


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try not only as a source for the latest manufacturing products, but also as an informa-tion centre, as we compile the thoughts and opinions of many engineers and designers from around the world.What do you look to get out of the Vietnam Manufacturing Expo 2017? What are the key products Misumi Vietnam will present there?The Vietnam Manufacturing Expo 2017 is a great opportunity for us to increase the awareness in Misumi Vietnam for Vietnamese manufacturers.We would like to communicate three points during the Expo. The first is that Misumi Vietnam offers more than three million components. Customers can search through our products, make comparisons, get price quotes, and purchase the best items from a variety of product lines. The second point we want to communicate is that Misumi Vi-etnam provides pre-assembled products and ships quickly, accurately, and free of charge. Finally, we want people to know that Misumi Vietnam provides many conven-ient services. Some examples include our e-catalogue, WOS (Web Ordering System), and CAD data (2D/3D) software. We provide our customers with quick price quotes and expedited technical schematics. Misumi Vietnam will continue to evolve locally to help customers search for and purchase our products.http://www.vir.com.vn/misumi-automates-production.html

Peugeot Scooters aims to diversify Vietnam's premium scooter segment

18/MAY/2017 INTELLASIA| TUOITRE NEWS

Xavier Casin, Chief of Representative Office of Peugeot Scooters in Vietnam and Asia director of Peugeot Motocycles, has shared about the company's commitment to the Vietnam market in the Vietnam Motorcycle Show 2017 last week.The French brand Peugeot Scooters was launched in Vietnam last October.* How is Peugeot Scooters' brand introduction in Vietnam being rolled out?We launched the brand in October 2016.We started local production two months later in December and delivered our first cus-tomers on December 15th and 20th in HCM City and Hanoi respectfully, just before Christmas.We are very happy with our initial results despite of the fact that we have a very lim-ited retail network for the time being, and considering the low season for scooter pur-chasing in the first quarter of 2017.Hanoi will be the first city worldwide to open a flagship store with the new brand identity.More than a showroom to see our products, the store is a location where customers can experience our brand.Opening such a place in Hanoi shows how important Vietnam market is to our busi-ness in the Asia Pacific region, or the company as a whole.For the time being, we have two locations in Hanoi and HCM City operated by our of-ficial importer and distributor.Two other locations have been opened by independent dealers in Da Nang and Bien Hoa. More stores in the north and south of the country will open in the near future.Talking about the business performance, our main target this year is to establish Peu-geot Scooters as a premium brand in Vietnam where until now there has been a very limited choice in terms of brands or products in this segment.In comparison, the European market which is much smaller than Vietnam has more than 30 brands in the 125cc segment.Our target is really to be on the shopping list of those buyers who are looking for scoot-ers in the premium segment within the price range of VND60 million to VND80 mil-lion. (US$2,680 -$3,570)* Your company was at the 2017 Vietnam Motorcycle Show in HCM City last week. Why did you take part in the event?It was important for us to attend this second edition of the motorcycle show in Viet-nam as it is the most important market in the region and we are in the country for the long haul.We are not a trading company looking for short-term business; we are a manufacturer


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with a partner who has invested in a factory and distribution network.We are jointly working on the long term and we have to be here at this motorcycle show to present the brand to Vietnamese consumers in general and specifically in HCM City.http://tuoitrenews.vn/business/41027/peugeot-scooters-aims-to-diversify-vietnam-s-premium-scooter-segment

La Casta: Western charm in the Western gate of Hanoi


Korean-backed Hibrand Vietnam has just launched the La Casta residential project in Hanoi.Located at Van Phu Urban Development Area in Hadong district, La Casta is devel-oped on a 6.5-hectare land plot consisting of semi-detached houses, shophouses, and high-end apartment buildings. The project will be finished by the second quarter of 2018.Designed with a new mixture of the classic style combined with modern architectural elements, La Casta will be a modern and unique living complex, a landmark in the west of Hanoi.The complex consists of 160 low rise semi-detached houses from 71 to 176 square me-tres each and 199 shophouses. Located at the centre of Van Phu Urban Development Area, these 199 shophouses will be ideal for trading purposes. These units will have two street fronts, providing convenient access for the public. However, the shophous-es still reserve private space for the owners with a separate space between living and trading quarters. The project is centred with a clock tower, to set it apart form from oth-er projects in the area.La Casta inherited a rich transport and infrastructure system. The project is connected with Hanoi city centre by the city's main arteries, such as Le Trong Tan, To Huu, and Lang Hoa Lac Expressway as well as provide convenient access to Ring Road No. 4. Besides, Bus Rapid Transit No. 01 linking Kim Ma Street to Van Phu Urban Develop-ment Area will also make the project more convenient.Especially the two elevated railway stations Van Khe and La Khe located near the project will make La Casta one of the most conveniently placed projects in Hanoi.Moreover, it is the only project in Hadong district that boasts a one-hectare park in a western design. In addition, a sport park of more than 50 hectares will be set up next to the project site in the future, bringing about great benefit to the whole region in gen-eral and the project in particular.http://www.vir.com.vn/la-casta-western-charm-in-the-western-gate-of-hanoi.html

A New Wing Takes Flight in Hoi An's Old Town

18/MAY/2017 INTELLASIA| LIGHTHOUSEPRCO

A major expansion, refurbishment and rebrand has propelled La Siesta Resort and Spa Hoi an into the elite category of hotels in Hoi An a UNESCO-listed ancient port fa-mous as one of the most Vietnam's premier tourist destinations. The property, which is owned and operated by leading Vietnamese boutique hotel brand Elegance Hospitality Group (EHG), recently unveiled a name change it was formerly the Essence Hoi An Hotel and Spa and its brand-new East Wing, a luxurious 37-room annexe that also encompasses a spa, saltwater pool and fine-dining venue. Currently in its soft-opening phase, the new wing features an array of luxurious room types. Poolside suites come with deep wooden bathtubs and private Swedish saunas. Duplex suites benefit from clawfoot bathtubs and expansive balconies overlooking the pool. The Premium Terrace Suites, meanwhile, span a generous 76-sqm and are kitted out with private Jacuzzis. Attention to detail is to the fore throughout the new wing. Specially commissioned teak furniture was handcrafted by artisans, while flooring that combines polished wood and patterned tiling evokes an old-world charm in-keeping with the timeless aura of Hoi An itself. "That was a real priority for us when it came to conceptualising and realising our vi-sion for the new wing making it as harmonious to the atmosphere in the destination


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as we could," said Nguyen Cao Son, EHG Chief Operation Officer. "Not only did we want to create something that would elevate the boutique resort experience in Hoi An, we were aware of our architectural responsibility to stay true to the spirit of the place." As such, guest rooms are aligned around an extensive saltwater swimming pool in three storey buildings, carefully designed to maintain harmony with the traditional ar-chitecture that characterises Hoi An's UNESCO World Heritage-listed old town. Other call outs to the destination's incredible heritage include an on-site Confucian temple dating back to the 15th Century, which will be used in future for special event dinners and traditional lantern festivals. The resort is located in Thanh Ha village a peaceful area famous for its ceramics and is just a short 5-10-minute walk from the shophouses, temples, colonial buildings and iconic Vietnamese tube houses that characterise cen-tral Hoi An. Yet while sympathy to local tradition is very much in evidence throughout the new wing, trimmings and service standards are in keeping with those of the very best mod-ern five-stars. Inviting extras include access to a personal butler (for suites and villas), handmade toiletries from La Siesta's own line of spa products and state of the art in-room technology such as Samsung sound-bars and espresso coffee makers. Other highlights of the new wing include a luxurious spa lounge and the Temple res-taurant, which serves international buffet breakfast and elevated European-influenced fare for lunch and dinner in an attractive poolside setting. The new wing blends seamlessly with the existing west section of the property, ac-claimed by guests for its charming colonial-style low-rise architecture and the highly-rated Asian cuisine served at its Red Bean restaurant. "Our mission with the new wing was to position La Siesta Hoi An at the pinnacle of the hotel offerings in Hoi An, alongside established international brand names," said Cao Son. "However, we also wanted to maintain the Vietnamese character and warmth of service that EHG has been widely commended for. We think we've man-aged to achieve something very special."

Central Field to open in Q3


Three-tower residential-office complex in Hanoi's west to have retail and office space leasing managed by CBRE.The Central Field residential-office complex, developed by the 19-12 Bac Ha Ltd Com-pany, will open its doors in the third quarter.Located at 219 Trung Kinh, Cau Giay district, Hanoi, Central Field is a three-tower complex with 27 levels in each, including two residential towers and one office tower with a five-floor retail podium.CBRE Vietnam has been selected by 19-12 Bac Ha to be the exclusive leasing agent for the retail and office space.It will begin a leasing campaign for the retail and office space this month. Situated in a convenient location and with a practical design, Central Field is expected to be a great choice for businesses looking for Grade B office space in the west of Hanoi."We have put a lot of effort into Central Field and strongly believe that the project will become the most ideal and convenient office destination in Cau Giay district," said Tran Thi Thanh, CEO of 19-12 Bac Ha. "After a careful selection process, we decided to appoint CBRE Vietnam as our exclusive leasing agent. Leasing activities will be taken care of by the experienced and professional leasing team at CBRE Vietnam.""CBRE Vietnam is honored to be appointed as the exclusive leasing agent for Central Field," said Nguyen Bich Trang, director of CBRE's Hanoi branch. "The project will add to the diverse supply of Grade B offices in the west of Hanoi, given its convenient ac-cessibility and reasonable price, which is suitable for businesses with modest budgets."http://vneconomictimes.com/article/property/central-field-to-open-in-q3

Can Tho's new air route subsidy plan stirs controversy

18/MAY/2017 INTELLASIA| DTI NEWS

Authorities of the Mekong Delta city of Can Tho have offered to assist airlines in re-couping potential losses from future flight routes to the city. However, the proposal


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has drawn the public and expert opposition.Vo Thanh Thong, chair of Can Tho City People's Committee, said the city was consid-ering how to support airlines to open more air routes.The Can Tho Transport Department has been assigned to gathering feedback from the public for the support which uses the state budget.According to Can Tho City's plan, airlines will be given support to open new offices and advertise. During early days when the routes are first opened if the empty seats account for more than 30 percent of the total seats then the authorities will provide fi-nancial support to offset some losses for flights from Can Tho Airport.It is estimated to cost the city VND5bn (USD220,000) to offset losses for each airline with new domestic routes during the first year and VND8.5bn for each airline with in-ternational routes. Thong noted that the maximum amount the city would need to ear-mark VND5 billion (USD223,200) a year for domestic services and VND8.5 billion (USD379,460) a year for international routes.UnreasonableAssociate Prof Nguyen Thien Tong, a former lecturer from the HCM City University of Technology's Aviation Engineering Department, said that the air travel demand in Vietnam's southwestern region has been on the sharp rise; but in reality, the operation efficiency of Can Tho International Airport remains low. So the problem is how to op-erate airport better."To launch a service, airlines obviously have to consider its efficiency and it is unrea-sonable to use the state budget to offset for their losses," Tong added.A report by Airports Corporation of Vietnam indicated that by late 2015, only big air-ports such as Noi Bai and Tan Son Nhat made profits, meanwhile, smaller airports suf-fered from losses as they served only a small number of passengers.For instance, Chu Lai Airport in Quang Nam Province only serves around 8 percent of the designed capacity of around 500,000 passengers annually. The passenger rate for Can Tho Airport is 15 percent and other airports such as Tuy Hoa, Lien Khuong, Ca Mau, Rach Gia, Dien Bien and Dong Hoi saw the rate of 11-37 percent compared to the designed passenger capacity.Meanwhile, a range of projects to expand and build airports have been underway or to be carried out. This year, the three northwestern airports namely Na San, Lai Chau and Lao Cai with a total investment capital of nearly VND10 trillion (USD460 million) are scheduled to be built. Van Don International Airport in Quang Ninh Province is also slated to be operational in 2017. Thanh Hoa Province is seeking the government's approval to upgrade Tho Xuan Military Airport into the international level.WastefulnessEconomist Bui Trinh from the General Statistical Office of Vietnam mentioned a cur-rent trend in Vietnam that many localities are rushing to build expressways, airports, monuments or statues without careful consideration about their point, creating unnec-essary government debt.The Hanoi-Hai Phong Expressway has been open to traffic since early 2016, cutting travel time from Hanoi to Hai Phong to less than two hours. Many people in Hanoi's neighbouring localities can get to Noi Bai International Airport, instead of choosing Cat Bi Airport."The distance between two cities is around 130km, so it is unnecessary to build their own airports. It is more important to build good roads for people to travel more easi-ly," Trinh noted.Associate Prof Nguyen Thien Tong disagreed with the plan to build three northwest-ern airports, saying that the investment instead should be used to develop road net-works."It is important to consider the responsibility of investors of loss-making airport projects as well as agencies which approve them. It is essential to define the interest groups of these kinds of projects," Tong highlighted.http://english.vietnamnet.vn/fms/business/178548/can-tho-s-new-air-route-subsidy-plan-stirs-controversy.html


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City to help Laos call for investment


A conference on promotion of investment, trade and tourism in three provinces in cen-tral Laos is expected to be held in HCM City by the end of June to call for domestic and foreign enterprises in the city to come to Laos to do business.At a preparatory meeting on May 16 with the participation of representatives of Bo-likhamsai, Savannakhet and Khammouane provinces, HCM City vice chair Huynh Cach Mang promised the city would mobilise resources to organise the event and help the neighbouring country seek investors.Leaders of the three provinces will introduce potentials and advantages, and invest-ment policies at the forthcoming conference. In addition, the three Lao provinces will introduce Lao partners to HCM City-based enterprises that want to invest in Laos.Representatives of the three provinces said on May 16 that they need to attract foreign investment to develop the local economy.In recent years, Laos has organised multiple events to call for investors in HCM City.http://english.thesaigontimes.vn/53979/City-to-help-Laos-call-for-investment.html

Da Nang to investigate real estate violations


Da NangCity's construction department has asked the municipal public security de-partment to investigate illegal transactions related to the Muong Thanh Apartment project in the central city.The project began selling apartments last year, despite not being allowed to do so ac-cording to a statement released yesterday by deputy director of the department, Thai Ngc Chung.Chung said construction on the project, which began in 2015 on an area of 2,800sq.m with two 42-storey buildings and a hotel, was suspended due to several violations in-volving the apartment buildings.He said the project owner, the Muong Thanh Group, illegally changed designs from the second to the fifth floors. The floors should have been reserved for a kindergarten and parking area, but instead 104 flats for sale were constructed.The department fined the project owner VND40 million (US$1,800) on June 29, 2016, and suspended construction of the project.The project owner then submitted the city and department a revised design adding the 104 extra apartments for approval.The city agreed to allocate an area for underground parking lots combined with a kin-dergarten and park beside the apartment project.However, the project owner and construction contractor Dien Bien construction No 1 resumed construction while awaiting approval for the revised designs from the min-istry of construction, the central city's people's committee and the department.Chung said the department once again halted construction of the project on April 11, 2017.Meanwhile, the project owner and its agent launched sales of apartment, despite the project not being listed as eligible to sell apartments.According to the project's marketing and sale agent, Nam Long Land company, apart-ment buildings were offered from VND15 million ($666) to VND17 million ($756) per sq.m from 2016.Earlier this year, the city also suspended construction of a coastal eco-tourism project in the Son Tra peninsula including the Bien Tien Sa Joint-Stock company project in the Son Tra Nature Reserve; 68 houses and villas in Son Tra Mountain and the 43-storey Central Coast condotel project.http://www.vir.com.vn/da-nang-to-investigate-real-estate-violations.html

Over 200 firms to attend screen and digital printing tech expo


More than 200 local and international companies will descend to a three-day interna-tional screen printing and digital printing technology exhibition slated to open on May 18.The first such show in Vietnam is being organised by the Asia-Pacific Screen Printing


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& Graphic Imaging Association (ASGA) at the Saigon Exhibition and Convention cen-tre (SECC).Participating enterprises come from 11 countries and territories including Japan, Chi-na, Vietnam, India, Thailand, South Korea, Singapore, Pakistan, Sri Lanka, Taiwan and Hong Kong.ASGA has organised the show in many countries since 2001. This is the first time the event has been brought to Vietnam as there are many investment projects in the textile, footwear, electronics, packaging and ceramics sectors and 80 percent of Vietnamese printing houses are using screen rather than digital printing technology.Therefore, ASGA expects the exhibition will help develop printing technology in Viet-nam.Johnny Shell, vice president of the Specialty Graphic Imaging Association (SGIA), will be showing up at the exhibition to share his knowledge of and experience in advanced textile printing technology.ASGA was established in 1994 with 11 countries Japan, South Korea, China, Thailand, Indonesia, India, Philippines, Vietnam, Nepal, Sri Lanka and Australia becoming members.The association's mission is to develop modern digital, specialty and screen printing technologies in Asia-Pacific countries through specialised exhibitions.http://english.thesaigontimes.vn/53987/-Over-200-firms-to-attend-screen-and-digital-printing-tech-expo.html

Vietnam International Motor Show to introduce new car models


The Vietnam International Motor Show (VIMS 2017) will be held at the Saigon Exhibi-tion Convention Centre in HCM City from October 25-29.Speaking at a press conference on May 17, Laurent Ganet, general director of Audi Vi-etnam, said car importers in Vietnam hope to build connections with customers through the event.According to the organisers, seven carmakers, including Audi, Jaguar, Land Rover, Maserati, Mercedes-Benz, Subaru and Volkswagen, have registered to participate in VIMS 2017.A highlight of the event will be introductions of new car models such as Audi A5 Sportback, Jaguar F-FACE, Evoque (Land Rover), Quattroporte (Maserati), GLC 300 Coupe (Mercedes-Benz), Subaru WRX STI and Volkswagen Sharan.Besides, there will be several booths displaying components, car accessories and fi-nancing-banking-insurance services, among others.VIMS 2016 welcomed nearly 128,000 visitors and saw almost 2 million interactions on its official Fanpage, making it one of the top ten events of the month on the social net-work.http://en.vietnamplus.vn/vietnam-international-motor-show-to-introduce-new-car-models/111865.vnp

Major auto brands confirm presence at 3rd Vietnam International Motorshow


Seven major auto brands have so far confirmed participation at the third Vietnam In-ternational Motorshow (VIMS 2017) to be held in HCM City next October.At the event at the Sai Gon Exhibition and Convention Centre, Audi, Jaguar, Land Rover, Maserati, Mercedes-Benz, Subaru, and Volkswagen will bring a range of mod-els and advanced technologies and take part in other activities like test driving and stunt shows.Organised by Vehicles Importers Vietnam Association, CIS Vietnam and Le Bros, the motor show, on an area of over 10,000sq.m, expects to attract 120,000 visitors."While the imported car market in Vietnam is becoming more and more diverse with notable growth in numbers since the beginning of 2017, Vehicles Importers Vietnam Association wishes to proactively connect car importers with customers through VIMS 2017," Laurent Genet, general director of Audi Vietnam, said."Each participating brand will deliver their own story and unique traits that we believe


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will provide an unprecedented experience for visitors in general and car lover in par-ticular."The show would run from October 25 to 29, he added.In addition to automobiles, there will also be supporting products and accessories.Last year there were 16 brands and 150 models at the show, which attracted nearly 128,000 visitors and set social networks abuzz.In the first quarter of this year auto sales in Vietnam grew at an impressive 30 per cent.http://bizhub.vn/wheels/major-auto-brands-confirm-presence-at-3rd-viet-nam-inter-national-motorshow_286218.html

Event connects businesses exporting products to China


The Ministry of Industry and Trade (MoIT) and the northern mountainous province of Cao Bang held a meeting on May 16 to connect exporters of agro-fishery-forestry prod-ucts to China.In recent years, import-export activities through border gates between Vietnam and China have grown significantly, with several bilateral cooperation mechanisms and border trade policies decided.However, there are still weaknesses in product structure and infrastructure at border gates, while businesses have not received proper support.Participants at the meeting suggested the provincial People's Committees create fa-vourable conditions for importers and exporters using Vietnam-China border gates.Nguyen Van Hoi, deputy head of the ministry's Border and Mountainous Area De-partment, asked leaders of seven provinces which share a border with China to estab-lish exporters' associations.He also stressed the need to provide information for businesses and increase the ca-pacity of these businesses.Wei Xian Qiang from the Department of Commerce of the Zhuang Autonomous Re-gion of China's Guangxi province suggested the two sides review mechanisms and policies to attract more investment, expand markets, and increase import-export turn-over of agro-fishery-forestry products.At the meeting, the MoIT and Guangxi province signed several memoranda of under-standing, including a document to hold more seminars to share information and deal with border trade-related issues and another on establishing an e-trading floor for bor-der trade.http://en.vietnamplus.vn/event-connects-businesses-exporting-products-to-china/111838.vnp

Construction and building materials expo opens in Hanoi


An international construction and building materials expo, which runs May 17-21, has thrown its doors wide open at the national exhibition construction centre in Hanoi, re-ports the Vietnam News Agency.New products and services in the fields of construction, building materials, real estate and interior and exterior decoration will exhibit at the event Vietbuild Hanoi 2017 at an estimated 1,000 exhibition stalls from 12 countries.Nguyen Tran Nam, chair of the Vietnam Real Estate Association said the exhibition has become one of the top venues in Asean for profit and non-profit organisations in the construction segment to get up to date on the latest technologies and meet face to face with peers and potential customers.During the event visitors will have an opportunity to attend technical workshops on the latest advances in construction materials and meet with preeminent roofing main-tenance professionals to gain valuable insights into product reviews, training and net-working opportunities.http://english.vov.vn/economy/construction-and-building-materials-expo-opens-in-hanoi-349731.vov


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Vietnam finishes third in Southeast Asia race for tourist dollars


Thailand is way ahead of the game, but Vietnam still welcomed record foreign arrivals and revenue in 2016.Tourists arrivals in Vietnam past the 10 million mark last year, and the $18 billion in revenue collected by the sector contributed around 7.5 percent to the country's econo-my.According to tourism data, Vietnam fell far short of Southeast Asia's most popular des-tination,Thailand, which received over 30 million international arrivals and bagged nearly $46 billion from tourists.The entire region, excluding Myanmar and Brunei, raked in an estimated $120 billion from tourism, based on data compiled by VnExpress International. However, the fig-ure was just half that earned by the United States alone.On average, each visitor to the US spent approximately $3,000, while in Asia, their spending was three times less.However, Vietnam made significant progress by rising eight places in a global tourism competitiveness index compiled by the World Economic Forum. It also said the coun-try could take better advantage of this momentum by focusing more on sustainable en-vironment policies.Tourists are mostly lured by Vietnam's rich natural and cultural resources.By 2020, the sector is expected to contribute 10 percent to Vietnam's gross domestic product and is set to welcome 17-20 million foreign visitors per year.By 2030, it is aiming to become the leading destination in Southeast Asia.http://e.vnexpress.net/news/business/data-speaks/vietnam-finishes-third-in-south-east-asia-race-for-tourist-dollars-3586338.html

Young Vietnamese leaders attending Australia-Vietnam Young Leadership Dialogue


Dialogue being held in Sydney from May 15-18 and aims to facilitate a deeper under-standing and collaboration between young Australian and Vietnamese leaders.Twenty of Vietnam and Australia's brightest young leaders representing the arts, fi-nance, technology, philanthropy, business, startup, education, and healthcare fields will converge in Sydney to share ideas and innovation at the inaugural Australia-Viet-nam Young Leadership Dialogue (AVYLD) from May 15-18.The Dialogue aims to facilitate a deeper understanding and collaboration between young Australian and Vietnamese leaders to enhance the economic, social, and cultur-al prosperity of the two countries.An impressive number of successful hand-selected delegates have emerged from the startup space and business sector, showcasing Vietnam's ever-rising skilled workforce and talent, which Australia can benefit from."Australia has traditionally overlooked business and trade opportunities with Viet-nam in comparison to its focus on other larger Asian markets," said Nguyen Thao, Co-Founder and Chairwoman of AVYLD. "It is the only country other than China to grow consistently above 6 per cent per year on average for over a decade. Vietnam has been emerging as a tiger. It is time Australia took more notice."Thao also highlighted the young talent selected to share their knowledge: "Inspiring delegates include Dao Hoang, who studied at the University of Technology, Sydney, and is the creator of Monkey Junior, an early childhood reading app," she said. "The app is the most downloaded education app in the App Store and Google Play in the US, Canada and Vietnam. This Dialogue will demonstrate the exciting potential of the bilateral relationship."Chair of the Board for UTS:INSEARCH, Emeritus Professor Ross Milbourne, said that higher education is an important area in which Australia and Vietnam can collaborate for mutual benefit. "Developing greater cultural awareness, a global mindset and in-ternational connections are some of the benefits we see when Vietnamese and Austral-ian students learn together," he said. "The Dialogue will offer this experience to a group of impressive young leaders who can drive innovation between both countries in the future."


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One of these young leaders is Vietnamese AVYLD delegate Pham Dat, who was listed in Forbes 30 under 30 Vietnam 2016 is the Founder and director of HATCH!, an entre-preneurial and startup accelerator programme. "Tens of thousands of entrepreneurs have already come through our programme since we began in 2012," Dat said. "There is a huge appetite from young Vietnamese to become the international success stories that past generations could only have dreamed of. That drive and determination is what creates this modern-day success story, which I hope will inspire others.""Now is the time to tap into the emerging talent and entrepreneurial mindset of the younger generation, who are driven with ambition to build bridges, create change, and lead innovation to the benefit of their respective countries," said Rachel Bui, CEO and Co-Founder of AVYLD and founding team member at Telstra's startup accelerator, muru-D."Australia's future relationship with Vietnam will be characterised by dynamism, in-novation, and deep personal linkages," said Australian Ambassador to Vietnam, H.E. Craig Chittick. "The first group of participants are outstanding leaders in a range of fields and their contribution to building a strong partnership between Australia and Vietnam will be felt for years and decades to come."The inaugural four-day Dialogue aims to facilitate deeper cross-cultural understand-ing and collaboration through discussions and workshops with speakers and peers. It will focus on innovation as an overall theme in areas such as leadership, education, business, and national development."The AAC Board is proud to sponsor the inaugural Dialogue between young leaders from Australia and Vietnam," said Christine Holgate, CEO of Blackmores and Chair of the Australia-Asean Council (AAC) Board. "I am confident that the outstanding dele-gates participating in this important event will make a significant contribution to building strong people-to-people and economic prosperity linkages between our two countries."Vietnam boasts a population of more than 90 million with the fastest-growing middle and affluent class in Southeast Asia, which is expected to double to 33 million people by 2020.http://vneconomictimes.com/article/vietnam-today/young-vietnamese-leaders-at-tending-australia-vietnam-young-leadership-dialogue

WannaCry virus attacks 1,900 computers in VN


Some 1,900 computers in Vit Nam have been attacked by WannaCry virus one of the largest-ever cyber-attacks affecting computers across the globe.The affected computers included 1,600 computers in agencies and businesses and 300 private computers.The data was revealed on Tuesday afternoon by BKAV Corporation, the largest inter-net security firm in Vit Nam.A representative from the corporation said the WannaCry virus had yet to spread in Vit Nam, however, four million computers in Vit Nam were discovered to suffer from a Windows vulnerability codenamed EternalBlue.It meant the virus could hit the computers at any time and the number of affected com-puters could rapidly increase, he said.V Ngc Sn, deputy head of the corporation's anti-malware department, said, "The Wan-naCry ransomware attack may just be the tip of the iceberg."The US National Security Agency was suspected to be using the vulnerability in its spy programme. There was also a possibility that a spy agency of another country was also secretly exploiting the vulnerability, installing spy software locally to carry out APT (advanced persistent threat) attacks," he said.Meanwhile, in a related move, BKAV has upgraded and freely offered a tool to help computer users in scanning and patching the vulnerability. Users can access to Bkav.com.vn/Tool/CheckWanCry.exe to download the tool.Previously, the Ministry of Information and Communication said the ransomware was extremely dangerous as it was capable of stealing information and decrypting the en-


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tire system that had been infected.Once the computer's data was encrypted or "locked down," a message would appear saying the users' files were no longer accessible. To retrieve data, users were asked to pay large sums of money to get a decryption key. The longer the users waited, the higher the ransom money. The hackers behind WannaCry only accepted ransom paid via BitCoin, a digital currency that ensures the transaction cannot be traced.According to AFP, security researchers on Monday reported signs of a potential North Korea link to the massive cyberattack campaign that sparked havoc in computer sys-tems worldwide.Following days of disruptions affecting networks worldwide, a top US official said the number of computers affected had reached 300,000, but that infection rate had slowed.http://www.vir.com.vn/wannacry-virus-attacks-1900-computers-in-vn.html

Shim to serve second term as Samsung Vietnam CEO


Shim Won Hwan has officially been appointed general director of Samsung Vietnam, the South Korean giant announced yesterday.This is will be Shim's second time to hold this position; h was Samsung Vietnam's gen-eral director in the 2010-14 period.Speaking on the first day of his assignment, Shim said he was happy to return to Viet-nam."I and Samsung Vietnam's management board will strive to contribute to the country's socio-economic development while maintaining the leading role of Samsung Vietnam in the world," he added.Born in 1959, Shim has more than 33 years' experience working at the Samsung Group, since his graduation from Kyungpook National University. He has held several impor-tant positions at Samsung, especially in human resources and management, and was general director of the Gumi Plant in South Korea since 2015.In Vietnam, Shim will be in charge of external relationships, public relations, environ-ment, health and safety, administrative and human resources.He will replace Han Myoung Sup, who will return to South Korea to take over new responsibilities after spending two and a half years in Vietnam.http://bizhub.vn/corporate-news/shim-to-serve-second-term-as-samsung-viet-nam-ceo_286219.html End


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