Domestic gold demand suffers sharp downturn

Viet Nam's demand for gold declined sharply quarter-on-quarter by 27 per cent in volume and 29 per cent in value in the third quarter of 2014.

According to the World Gold Council (WGC)'s latest global gold consumption report, the country's registered gold consumption in the third quarter reached 19 tonnes worth US$783 million. Of the total, gold jewellery accounted for two tonnes worth $82 million, a nine-per cent decline, while gold bars and coins made up 17 tonnes worth $701 million, a 29-per cent decline.

The report also showed that as of September, Viet Nam consumed 79.3 tonnes of gold worth $3.275 billion, a 19-per cent decrease in volume and 30-per cent decrease in value.

The WGC ranked Viet Nam as the world's seventh largest gold consumer last year, with 92.2 tonnes worth $4.16 billion, a 20-per cent year-on-year increase.

This year, Viet Nam is witnessing a decline in demand for gold as decelerating inflation and more attractive opportunities in stocks, property and bank deposits have driven interest away from it. Industry insiders said this trend was new to Viet Nam.

Previously, when the economy was unstable and inflation was high, people only trusted gold. Now people are seeking investments in stocks and property, and simply depositing money in banks could give them good returns, so demand for gold had dropped sharply.

The report also showed that world gold demand in the third quarter reached 929.3 tonnes, a four-per cent quarter-on-quarter decline. Demand for gold jewellery accounted for 534.2 tonnes of the total.

India and China remained the world's top gold consumers in the quarter, with 225.1 and 182.7 tonnes, respectively.

Consumer confidence keeps climbing

Consumer confidence in Viet Nam gained further momentum in the third quarter, increasing by four points from Q2 according to survey results released last week by global information and measurement company Nielsen.

The Nielsen Global Survey of Consumer Confidence and Spending Intentions reveals that for the first time since 2012 consumer confidence levels in Viet Nam exceeded 100 points to stand at 102 while globally consumer confidence remained steady at 98 points.

Vaughan Ryan, managing director of Nielsen Vietnam, said, "the four-point increase to 102 for Q3 is the largest change in a number of years and does show some positive signs of improving consumer confidence, despite a tough 18 months.

"It is the highest level recorded since Q4 of 2013. It is important to acknowledge that overall, Vietnamese consumers are still very cautious as economy and job security are still the main concerns."

Consumers still have a strong sentiment for putting cash into savings but for the first time in a number of years the number of people saying this has reduced, he said.

"Across the board we saw an increased intent to spend money on holidays, new clothes, new technology, home improvements and more out of home entertainment. This is such a positive sign that it looks like consumers are about to open their wallets again.

"The local market has been tough, but the Consumer Confidence Study showed some really positive signals, which is fantastic leading up to Tet and into 2015."

While a majority of consumers across Southeast Asia have a positive outlook for the future, the economy and job security remain the top concerns.

In Thailand, 44 per cent listed the economy as a key worry over the next six months, while it was 34 per cent in the Philippines, 33 per cent in Malaysia, 27 per cent in Viet Nam, and 24 per cent in Singapore.

Thirty four per cent of consumers in the Philippines felt uncertain about job security, 26 per cent in Thailand, 22 per cent in Viet Nam, and 20 per cent in Singapore.

Besides, the region's consumers remain focused on putting aside savings for the future, with 77 per cent and 74 per cent consumers in Viet Nam and Indonesia respectively stashing their spare cash into savings after covering essential living expenses.

Consumers in other Southeast Asian markets are also diligently building nest eggs, including those in the Philippines (67 per cent), Thailand (67 per cent), Singapore (66 per cent), and Malaysia (63 per cent).

Along with savings and investing in stocks, consumers in the region are also eager to spend on big-ticket items.

Singaporeans are the most inclined globally to spend their spare cash on vacations (51 per cent), followed closely by Malaysia (47 per cent), and Indonesia (41 per cent).

Around a third of consumers in the Philippines, Viet Nam, and Thailand prefer to spend their spare cash on new clothes.

Five Southeast Asian markets — Thailand, Viet Nam, Philippines, Malaysia, and Indonesia — rank in the top 10 globally in changing their spending habits to reduce household expenses.

In Thailand, 88 per cent have changed their spending in the past year to save on household expenses, the highest level globally, followed by 86 per cent in Viet Nam, 83 per cent in the Philippines, 79 per cent in Malaysia, 76 per cent in Indonesia, and 63 per cent in Singapore.

The survey, done in August–September, polled more than 30,000 people online in 60 countries in the Asia-Pacific, Europe, Latin America, the Middle East/Africa, and North America.

SMEs encounter difficulties accessing banking loans

Gaining access to capital is an ongoing concern for small and medium-sized enterprises (SMEs), particularly in light of the increased need for working capital brought about by Vietnam’s integration into the ASEAN Economic Community (AEC).

At a seminar in Hanoi on November 18 discussing SMEs’ capability to access bank loans, General Director of the Institute of Manpower, Banking and Finance (BTIC) K. Balasingam said many SMEs have recently been forced to close their doors due to shortage of working capital.

Only 30% of SMEs have the ability to obtain needed working capital by accessing bank loans, while the remaining 70% have to raise the funds through equity financing arrangements with investors at a significantly higher cost, he said.

Echoing Balasingam’s view, SME Management Science Institute Director Pham Ngoc Long in turn said that since 2011, SMEs have not enhanced their competitive edge and have continued to encounter hindrances in getting access to capital resources.

Tran Trung Kien from Techcombank said one of the issues faced by banks is the shortage of medium and long-term capital resources at reasonable interest rates to meet the SMEs’ demand.

Kien added SMEs have also encountered difficulties in improving transparency in financial reports while banks can approve loans based on these reports. In addition, SMEs’ business plans are generally incomplete or inaccurate and are not sufficient to persuade banks to provide loans.

At present, SMEs in Vietnam have played a key role in generating jobs, increasing income, and reducing poverty. They have used up to 51% of labour force and contributed more than 40% to GDP annually.

Vietnam attends int’l textiles fair in Australia

Vietnam’s largest garment and textile manufacturers are participating in the fifth edition of the premiere fashion and textiles trade fair in Australia ongoing at the Melbourne Convention & Exhibition Centre on November 18-20.

At the fair they have set up a bevy of pavilions casting the spotlight on a wide variety of high quality Made-in-Vietnam wares ranging from leather goods, sportswear, footwear, jewellery, silk, swimwear to ceramics.

The event offers an unparalleled opportunity for the Vietnamese enterprises to tout their products and find opportunities to network with businesses from Australia and throughout the globe.

Businesses include Garment 10 Corporation, Ho Guom Garment Joint Stock Company, Dong Xuan Knitting Company, Phong Phu Home Textile Joint Stock Company and Thang Long Garment Joint Stock Company.

In nine months leading up to October, Vietnam’s garment and textile exports to Australia surged 46.8% to US$97.3 million compared to just more than US$90 million from a year earlier.

US carries great potential for Vietnam exporters: official

The United States is poised to become the largest and fastest-growing market for Vietnamese exporters.

Nguyen Hong Duong, Deputy Director of the American Market Department of the Ministry of Industry and Trade (MoIT), made this statement at a workshop on "Vietnam and the United States' Trade Relations and Trans-Pacific Partnership (TPP): Major Prospects and Challenges” in Hanoi on November 18.

The Vietnam Trade Promotion Agency and the US Embassy in Ha Noi organised the event.

Duong said the US was a large and diversified market with great untapped potential and remained the largest importer of Vietnamese products.

He warned that the US had a strict and complicated legal system that Vietnamese businesses must study and master. Therefore, the TPP agreement represented a great opportunity for Vietnamese businesses in a larger playing field, with more openness and advantages, Duong added.

According to Duong, the TPP agreement, with the participation of leading economies such as the US, Japan and Canada, made the TPP a large economic space that accounted for 40% of GDP and one-third of global trade.

Moreover, the US remained the most attractive market for all exporting countries, including Vietnam, and this agreement may bring huge opportunities for Vietnamese products as the tax rate will drop to zero per cent, he explained.

According to the MoIT, Vietnam will maintain its export growth to the US market at 10% in 2014.

To take advantage of the TPP agreement from now on, Vietnam businesses have to prepare well for conditions to seize opportunities as the agreement takes effect.

Stuart Schaag, US Commercial Counselor revealed that every year, the US made an annual report on trade barriers of all countries, including Viet Nam, and sent reports to Vietnamese ministries and agencies on US trade barriers for Vietnam.

He said that apart from newly-issued policies on Vietnam's exports such as the Food Safety Modernisation Act (FSMA), the US Embassy had informed Vietnamese ministries and agencies in advance to help them disseminate information and conduct training courses for local businesses.

Tran Ba Cuong of the MoIT Multilateral Trade Policy Department said the biggest impact would come from the opening of the market, thereby raising competitive pressure from foreign rivals.

This would serve as an opportunity for well-performing domestic businesses but would be a great challenge for ailing businesses, he added.

In addition, the TPP is expected to generate a comprehensive impact on Vietnam's business environment through commitments that Vietnam offered in the agreement.

Vietnam, Indonesia target 10 bln USD in two-way trade by 2018

Vietnam and Indonesia have agreed to increase their two-way trade to US$10 billion by 2018 as part of the two countries’ strategic partnership.

The target was set during a meeting between State President Truong Tan Sang and Indonesia’s President Joko Widodo on the sidelines of the Asia- Pacific Economic Cooperation (APEC) Economic Leaders’ Meeting in Beijing, China, the Indonesian Foreign Ministry said in its recent press release on the results of APEC, ASEAN and G20 meetings.

According to the statistics of Indonesia’s Foreign Ministry and national statistics office (BPS), two-way trade between two countries annually rose 25% in the past five years to reach US$5.12 billion in 2013, doubling the figure in 2009. In the first eight months of this year, bilateral trade was US$3.71 billion.

Indonesia’s investment in Vietnam is still moderate with the largest project on cement production worth US$300 million.

According to Indonesia’s media and relevant agencies, Vietnam and Indonesia have a number of opportunities for mutual benefit.

Business sector should join human rights fight

The business sector's co-operation is essential for the success of global efforts on human rights, said Nguyen Trong Dam, deputy minister of Labour, Invalids and Social Affairs.

Dam spoke on November 18 at a seminar on the relationship between human rights and businesses hosted in Ha Noi during the Asia-Europe Meeting (ASEM). The three-day event was attended by 120 representatives of governments, research institutes, social organisations and enterprises from 53 ASEM member countries.

Statistics from the International Labour Organisation (ILO) and the World Bank showed that the recent global financial crisis and economic depression cost the jobs of about 205 million people and caused approximately 64 million people to fall into poverty.

"In that context, it is urgent that we promote international, regional and national efforts with the co-operation of the business sector to create more jobs, as well as guarantee the interests of the workers, particularly vulnerable ones like women and ethnic minorities," Dam said.

Zhang Yan, Executive Director of the Asia-Europe Foundation (ASEF), a non-profit organisation established by the ASEM member countries said that this informal seminar "could not come in a more appropriate time."

Vietnam, a member of the Human Rights Council of the UN and the Administration Council of the ILO, has paid considerable efforts recently in improving and guaranteeing workers' rights.

"The amended Constitution last year clearly regulates that the workers have the right to select their occupation and to work in a fair and safe workplace," said Dang Dung Chi, head of the Institute for Human Rights Studies. "It also prohibits discrimination against workers and child labor."

Another event, held by the Institutes for Human Rights Studies, the Institute for Workers and Trade Unions, and the Chamber of Commerce and Industry during the ASEM, focused on collective bargaining between workers and employers.

"Vietnam's Constitution basically matches international regulations on workers' rights," he said.

Apart from the Constitution, Vietnam also made changes to the Labor Law regarding minimum wages and requests for dialogue between employers and their workers.

A new draft Law on Occupational Safety and Health is expected to be submitted to the National Assembly in 2015 to help keep people safe at their workplaces.

Yet, the country is still struggling to address a high number of unpaid wages, which reached about VND80 billion (US$3.8 million) last year, leaving about 10,000 workers without wages, according to the Ministry of Labour, Invalids and Social Affairs.

Occupational accidents have also caused alarm. About 6,670 workplace accidents took place across the country last year, killing 627 workers and costing firms about VND72 billion (US$3.4 million).

The informal seminar on human rights is an annual part of the ASEM. It aims to help government representatives and experts across Asia and Europe share experiences and promote human rights. This is the first time Vietnam has hosted the seminar.

Vietnam pledges to facilitate RoK investors’ operations

Vietnam always welcomes and creates the best conditions for investors from the Republic of Korea (RoK) to do stable and long-term business in the country, especially in the fields of infrastructure, transport and support industries.

So said Politburo member and Permanent Secretary of the Party Central Committee’s Secretariat Le Hong Anh at a reception for visiting Kumho Asiana Chairman Park Sam-koo in Hanoi on November 18.

At the meeting, Le Hong Anh spoke highly of Kumho Asiana Group’s efforts and contributions to boosting the economic cooperation between two countries as well as its social activities in Vietnam over the past time.

Highlighting the fruitfully developing relation between Vietnam and the RoK, he asked RoK investors, including Kumho Asiana, to expand their investment and contribute more to human resources development, social activities and environmental protection in Vietnam .

For his part, Park Sam-koo informed the host of his group’s operations in Vietnam , saying that Asiana Airlines is the first carrier launching direct flights to Vietnam and now operates the largest number of flights between the two nations.

The group has effectively implemented a number of projects in Vietnam , he said, adding that the Kumho Asiana Scholarship and Cultural Foundation has granted 1,100 scholarships to Vietnamese students since its establishment in 2007.

He affirmed that Kumho Asiana will increase investment in areas of Vietnamese concern, thus making practical contributions to the country’s socio-economic development as well as developing the Vietnam- RoK relations in a more comprehensive and sustainable manner.

SHB forms subsidiary in Cambodia

Saigon-Hanoi Commercial Joint Stock Bank (SHB) has announced the formation of a wholly owned subsidiary in Cambodia, SHB Cambodia Bank with maximum authorized registered capital of US$50 million.

Recently, SHB has opened its third branch in Cambodia’s Toul Kouk district Cambodia. Its fourth branch SHB Por Senchay is planned to be founded in the near future.

Apart from SHB, many Vietnamese banks have made their foray into in Cambodia, including BIDV, Sacombank, MB and Agribank.

Vietnam posted a trade surplus of US$19 billion with the US in the first ten months of the year, according to the Vietnam Trade Promotion Agency (Vietrade) under the Ministry of Industry and Trade (MoIT).

The information was shared at a seminar to discuss prospects and challenges in the Vietnam-US trade ties when the Trans-Pacific Partnership (TPP) Agreement is signed in the coming time. Accordingly, tariffs will be reduced to zero %while highly competitive products will help Vietnam elevate its image in the international arena.

Vietrade reported the US has so far had 107 investment projects capitalized at over US$20 billion in Vietnam. Garments and textiles take the lead in export turnover, followed by footwear, wood products, interior decoration, mechanical products and electronics.

Nguyen Hong Duong, MoIT’s American Market Department Deputy Head said with entry to TPP, Vietnamese businesses will have to face many trade barriers when exporting goods to the US market.

Therefore, businesses should invest in production technologies to meet the requirements for international labour and environmental standards.

Stuart Schaag, commercial counsellor at the US Embassy in Hanoi said local businesses need to conduct a market survey, identify target customers, and inquire into information on tax, materials, and standards for product quality through the US websites.

Vietnam, Brazil hit record in two-way trade

Two-way trade between Vietnam and Brazil in the past ten months has exceeded last year’s figure, hitting over US$2.55 billion, a year on year increase of 35.8%.

According to Brazil’s Ministry of Development, Industry and Foreign Trade, in the reviewed period, Vietnam exported goods worth US$1.28 billion to Brazil and imported US$1.26 billion, up 33.5% and 38.2%, respectively.

Vietnam mostly shipped electronic products, mobile phones and spare parts, footwear, frozen fish fillets and synthetic fibers to Brazil. Meanwhile, the country imported maize, soy bean and by-products, cotton, and footwear and tobacco materials.

Brazil is Vietnam’s largest trade partner in Latin America. In 2013, the two nations’ trade turnover reached US$2.33 billion.

Managing trade risks for exporters

International trade throws up a number of risks exporters must be better equipped to handle, said Nguyen Chi Mai head of the Vietnam Competition Authority (VCA) at a recent conference in Ho Chi Minh City.

The conference, addressing the trade risks for exporters, was sponsored by the World Trade Organisation's Affairs Consultation Centre in coordination with the Ministry of Industry and Trade's Competition Management Department and the HCM City Business Association.

Since 1994, VCA statistics show there have been 90 trade defence investigations on Vietnam exports, including 47 anti-dumping lawsuits. Markets which most often use trade protection tools include the US (20%) and the EU (15%), followed by India, Turkey, Brazil and Argentina, Mai said.

Trade defence lawsuits are costly and a waste of time.  An ounce of prevention is worth a pound of cure and businesses should work to implement policies and procedures aimed at preventing lawsuits from happening in the first place.

They should implement policies to insure they fully understand the importing countries' anti-dumping and anti-subsidy regulations and be diligent in staying abreast of the ever changing market conditions.

Most importantly they should invest heavily in technology to add value to their products. Adding value directly correlates to a reduction in anti-dumping lawsuits, Mai said.

But if a law suit is served on them, above all else they must respond promptly to protect their rights.

Meanwhile the number of trade lawsuits demonstrate that local businesses have not paid sufficient attention to protect themselves while the markets continue to get more and more competitive.

Over the past 10 years, VCA has received complaints from 11 cases, conducted investigation on 3 cases and levied anti-dumping taxes in two situations.

In the coming time after a number of free trade agreements come into effect and a mass of imported products hit the domestic market, better protective measures would need to be put in place to protect the domestic market.

VCA official Nguyen Huu Truong Hung in turn said local businesses have not paid due attention to safeguard measures because they have not been fully aware of their role, and lacked adequate information.

The legal procedures to initiate or defend against a lawsuit are very complicated, requiring careful investment of businesses. Furthermore, local firms are often unable to obtain timely accurate information to demonstrate that foreign products are being dumped in the domestic market.

Thus, to use safeguard measures to deal with unhealthy competition, businesses should raise their legal knowledge, Hung added.

He cited as an example an anti-dumping lawsuit filed last May by two major stainless steel producers, Hanoi-based Inox Hoa Binh and the Republic of Korea's Posco VST, against imports from China, Taiwan, Malaysia, and Indonesia.

After a five-month investigation by VCA, cold rolled stainless steel imported from four countries was found to be subject to anti-dumping tariffs ranging from 6.45% to 30.73%.

Thus, if local firms had been more alert to the improprieties and drawn attention to the unhealthy competition sooner they would have been better off Hung concluded.

RoK issues ‘Warning Letters’ to seafood exporters

Domestic seafood exporters have been warned against their violation of the RoK’s food safety regulations against chemical and antibiotic residues detected in 11 batches of tra fish.

They were mentioned in a list released on November 5 by the National Agro-Forestry-Fisheries Quality Assurance Department (NAFIQAD) under the Ministry of Agriculture and Rural Development (MARD).

The warnings claimed that some Vietnamese seafood products contain Nitrofuran residues that are higher than the permitted level. NAFIQAD said local seafood exporters should apply tougher examination measures to ensure food hygiene and safety.

Strict inspection should also be conducted at aquaculture farms and preservation process in accordance with regulations of the Ministry of Agriculture and Rural Development (MARD) as well as requirements of importers, the Department suggested.

NAFIQAD asked the Vietnam Association of Seafood Exporters and Processors (VASEP) to warn local seafood exporters of high chemical residue in their export products and assist them in examining for chemicals, particularly Nitrofuran and Fuzazolidon.

Vietnam’s largest automobile exhibition opens

Vietnam Motor Show 2014 (VMS) officially kicked off in HCM City on November 19, attracting 16 famous automobile brands in the country.

The event, co-organised by the Vietnam Automobile Manufacturers’ Association (VAMA) and importers, offered an opportunity for manufacturers and importers to introduce their latest models and technologies to customers.

Sixteen automobile brands have registered for the exhibition including nine VAMA members namely Ford, GM, Hino, Honda, Mercedes-Benz, Suzuki, Toyota, Vinastar, Daimler Trucks, along with seven automobiles imported brands such as Audi, BMW & Mini Cooper, Land Rover, Porsche, Nissan and Lexus.

In the past 10 months, nearly 121,600 cars have been sold, up 40% compared to last year’s corresponding period. In October alone, nearly 15,000 cars were sold, up 45%, according to VAMA.

Jesus Metelo N. Arias Jr, VAMA Chairman expressed his wish that the association would introduce the latest convenient and environmentally friendly models and technologies to Vietnamese consumers.

The five-day event is expected to attract 150,000 visitors.

There’s more than one Vietnam for investors

Some of Vietnam’s lesser known provinces offer real advantages, said Thomas Jandl, an Asia consultant and expert on the investment advantages of Vietnam’s diverse provinces, in his article recently posted on Borderlessnewsonline.

Thomas Jandl is a former assistant professor and Scholar-in-Residence at American University in Washington DC. He is the author of Vietnam in the Global Economy: The Dynamics of Integration, Decentralization and Contested Politics.

Here’s Thomas Jandl’s full article:

In the US, investors are drawn to different states for different reasons. While such preferences seem to be a no-brainer, foreign investors in Vietnam often make the mistake of all congregating around a small handful of provinces. This misses the fact that Vietnam comprises 63 diverse provinces that compete vigorously with each other for foreign capital and offer vastly different advantages to foreign firms in different industries.

Vietnam has become a must-go-to destination for international manufacturers in many industries, and the country has hosted thousands of foreign investment projects worth more than US$111.7 billion between 1998 and 2013. More and more multinational companies are looking toward Vietnam, as the Southeast Asian nation boasts cheap, eager and readily available labour, a safe and secure environment, and political stability.

Unfortunately, investors prefer what they already know, instead of what they – often unfairly – label “risky.” That means investors are missing out, as the risks are quite manageable with the right background knowledge about the various locations.

The United States Agency for International Development in cooperation with the Vietnam Chamber of Commerce and Industry (VCCI) publish an annual Provincial Competitiveness Index (PCI). In it, provinces are ranked rigorously (the lead investigator is a well-known American Vietnam scholar) along a number of indicators, like corruption, business support services, entry cost, time cost or transparency. A composite index then ranks all 63 provinces, giving investors a good idea what to expect.

Of course, different industries need different business environments, and not all provinces are equally suitable for a chemical manufacturer, a garment assembly line, or a computer chip facility.

In 2013, Danang and Hue cities topped the ranking, combining urban infrastructure with much lower cost of living than Hanoi or Ho Chi Minh City. Number three and four on the ranking go to a province near Ho Chi Minh City and one near Hanoi and the port of Haiphong.

The Southeastern region around Ho Chi Minh City enjoys the country’s best infrastructure, and after at least two decades of strong investment performance attracts many of the most motivated, entrepreneurial migrants.

As a result, foreign investors thinking about setting up shop in Vietnam look toward Ho Chi Minh City, and the Government Statistics Office reports that in 2011, six out of 10 foreign-invested firms were located in the Southeast region.

After two decades of rapid growth, Ho Chi Minh City has become a metropolis with all the trappings of an economic and financial centre – including traffic jams, sky-high rents, and a cost of living that requires rapidly increasing salaries. Garment factories are squeezed into a slew of industrial parks along all major traffic arteries entering the city. When shifts change, a tsunami of motorbikes floods the roads.

This human flood taxes local infrastructure, and the city’s governments and neighbouring Dong Nai and Binh Duong are actively discouraging new investments in low-added-value factories.

City officials say they want to see these factories go to nearby provinces, while fostering research, design, financing and other, higher-end support industries in Ho Chi Minh City. To that end, they support highway construction into adjacent Long An province, to make sure labour-intensive industries stay close enough to make Ho Chi Minh City their corporate homes while doing the cheap labour outside the expensive city.

This policy mirrors the Asian development experience known as the Flying Geese model. As one country becomes too expensive to produce a low-end product, it outsources it to others with cheaper labour. Japan, for example, outsourced transistor radios to Taiwan and Korea; as these economies developed, they outsourced it to the next emerging economies, Thailand and Malaysia. In Vietnam, the process takes place domestically, among provinces.

The central government is on message as well. Its goal has always been to develop target areas, then distribute the gains to other areas. Now it makes available generous tax holidays and low-cost land in well-developed industrial parks to companies that invest in certain target industries or target areas. A labour-intensive factory misses out on the best incentives Vietnam has to offer if it follows the crowd into expensive – and not tax-favoured – Ho Chi Minh City.

One of the reasons to locate in the growth poles has been labour availability. The concentration of industrial park attracted a large number of workers. Recently, however, the cost of living in these areas has driven workers back home – Vietnam has a large wave of return migration. Most provinces that used to lose their young and able workers to the economic growth areas can now offer returnees, who are accustomed to factory work and were trained in Ho Chi Minh City’s industrial zones.

Using rankings such as the PCI and a good consultant with connections on the ground can make the difference between simply investing in Vietnam – and taking advantage of the varied advantages Vietnam offers different industries with a wide range of needs.

Hanoi event promotes regional specialities

Hanoi will host the first annual programme to promote regional specialities from November 28 to December 2.

The large-scale event will gather specialities from 40 cities and provinces, including processed seafood, candy, tea and coffee, fresh fruits and spices, according to director of the Hanoi Trade Promotion Centre Nguyen Thi Mai Anh.

Visitors can taste a variety of produce items renowned for their quality. Some scarce items will only be available in limited quantity.

The Hanoi Department of Trade and Industry initiated the programme with the goal of expanding markets for these unique regional products.

"In recent years, localities have made tireless efforts to promote their products but failed to do it thoroughly," department deputy director Tran Thi Phuong Lan said. "Consequently, the specialities haven't caught on among consumers in other areas."

A conference on enhancing value and developing trademarks will take place on November 29, as will an activity to connect enterprises in Hanoi and other cities and provinces.

Thousands of visitors are expected to turn up at the Royal City Trade Centre in Thanh Xuan District to browse the 150 bamboo stalls, divided into geographic sections. For example, the Da Lat section will offer visitors a taste of Central Highlands culture and cuisine.

Economic counsellors from foreign diplomatic delegations have been invited to join the event, many representing key markets around the world, Anh said. The event will also see the participation of representatives of foreign enterprises, restaurants and hotels, distributors, producers and processors.

MoF urges simpler customs procedures

The Ministry of Finance (MoF) has asked 11 concerned ministries to join hands in simplifying administrative procedures to create the most favourable conditions for import-export activities.

In particular, the MoF has asked the ministries to review and issue their list of import-export items to be subjected to quarantine to avoid environmental pollution, including animals, plants and health care products, as well as toxic chemicals and pesticides.

Upon the request of the MoF, the General Department of Customs (GDC) has made every effort to shorten customs declaration procedures to make it easier for businesses.

In recent years, the GDC finished a draft plan to improve the effectiveness and efficiency of specialised inspections of imports and exports at the border gates with new features to facilitate and manage import and export activities. The draft plan aims to set up specialised inspection centres at the border gates, where a large volume of imports and exports need to be checked every day.

Under the plan, from now till 2020, the GDC will focus on building two centres in the cities of Hai Phong and HCM and three others at mainland border gates in the northern provinces of Quang Ninh, Lang Son and Lao Cai.

Customs staff are required to conduct specialised inspections by using optimised processes to get quick and accurate results and shorten customs clearance time for businesses.

On the other hand, importers and exporters with specialised goods for inspection should go through such centres to make the process quick and easy for them.

Vietnam, China to launch a joint trade-tourism fair

A fair to promote cross-border trade and tourism between Vietnam and China will be held from December 22-26 in Dongxing city in Guangxi, the People’s Republic of China.

A series of events are scheduled to attract participants, including exhibitions, festivals and cooperation forums.

According to the organising board, the event aims to strengthen the friendly ties between the two nations as well as encouraging trade in border areas.

Thai businesses eye up Quang Tri province

A group of businesses from northeastern Thailand met with local authorities and enterprises in the central province of Quang Tri on November 17 to seek investment opportunities.

During the meeting, the Thai group was given up-to-date information on a number of issues they showed interest in, including silk trade from Vietnam to Thailand, the process of establishing a representative office, provincial investment procedures, and local regulations on traffic and labour, said Chief of the Secretariat of Udon Thani province, Surasac Kasemsu.

Director of the provincial Foreign Affairs Department Hoang Dang Mai said the province, as a gateway to the East-West Economic Corridor (EWEC), had been focussing on infrastructure development as well as establishing cooperation ties and promoting trade, tourism and cultural exchanges within the region in recent years.

He also pledged to facilitate trade and consumption of Thai commodities.

Thai businesses have invested in Vietnam in a number of projects, including the Camel Rubber Factory and Superhorse Drinks.

Mai suggested the two localities’ business circles boost trade and bilateral cooperation in the fields of agricultural and forestry processing, commercial infrastructure development, tourism, logistics and services along the EWEC route.

Additionally, the Thai side should actively engage with trade fairs and exhibitions in order to research Vietnam’s business environment and seek partnership opportunities, he added.

VSIP Quang Ngai progresses on right track

The Vietnam-Singapore Industrial Park (VSIP) based in the central province of Quang Ngai has taken a proactive approach building infrastructure and calling for investments at the same time.

The move ultimately attracted nine foreign invested and one domestic projects totalling US$164.3 million for the park just after over one year, according to the park management board.

The projects include URC Central and Liwayway of the Philippines, King Riches Footwear, Maystar Footwear, Wing Fung Shing and New Manson of Hong Kong (China), Boiler Master of Singapore, Xindadong Textiles of China and MDC Sourcing of the Republic of Korea, and the Quang Ngai Water Supply Company.

They are engaged in producing beverage, confectionary, fibres, footwear, food, industrial boilers, and apparel.

According to the VSIP management board, three projects are likely to become operational this year, while three others will be finished in 2015. The projects require a total workforce of 8,000 labourers.

So far, 162 ha of the park’s 168-ha phase 1A were cleared with 100 ha smoothed. Work on 10km irrigation canals and 1.5km water supply pipeline was accomplished while the construction of 4.4km main road and a wastewater treatment plant with a daily capacity of 6,000 cubic metres is underway.

Construction work of a 3,000 sq. m fire rescue and fighting centre has also completed by 90%. Meanwhile, work on a VSIP Quang Ngai office building covering 3,500 square metres will be launched later this year. The project has a total investment of nearly US$23 million.

VSIP Quang Ngai and Son Tinh district are working together on the construction of an infrastructure system for a 13.4 hectare resettlement area for local people who had given land for the project.

At a recent working session with VSIP Quang Ngai Ltd., - investor of VSIP Quang Ngai project, Vice Chairman of the Quang Ngai provincial People’s Committee Pham Nhu So directed provincial departments to coordinate closely with the park management board to ensure the progress of the project.

He said the province considers the success of the project as its own.

Licensed on April 23, 2012, VSIP Quang Ngai covers a total land area of 458 hectares. The project, which has a total investment of US$125.35 million, was launched in mid-September last year.

It is expected to fuel the socio-economic development of the province, creating an attractive investment environment for the locality as well as job opportunities for tens of thousands of local labourers.

Vietnam exports urea to New Zealand

The Petroleum Fertiliser and Chemicals Company (PVFCCo) has completed procedures to export 500 tonnes of urea fertilizer produced by Phu My fertilizer plant to New Zealand.

This is the first shipment in Jumbo packaging form with 1000kg of fertilizer a bag.

To meet its business partners’ urea import demand, PVFCCo has installed a Jumbo packaging system at Phu My Fertilizer Plant with a total investment capitalisation of VND7 billion.

Duong Tri Hoi, Deputy General Director of PVFCCo said the first shipment of urea to New Zealand in Jumbo packaging form affirmed the position of Vietnamese products in international market. New Zealand has accepted Vietnam’s fertilizer with higher prices than the same products from the Middle East and other countries in Southeast Asia.

US continues anti-dumping tariffs on Vietnam’s pangasius

The United States International Trade Commission (USITC) has decided to keep anti dumping tax on pangasius imported from Vietnam at least in the next five years, according to the Vietnam Competition Authority under the Ministry of Industry and Trade.

The decision was made following the commission’s second investigation review for anti-dumping duties on pangasius imported from Vietnam with 100 percent of votes in favour.

The USITC stated that the revocation of the tariffs on the Vietnamese goods would be likely to lead to “continuation or recurrence of material injury” to the US’s frozen-fillet industry within a foreseeable time.

Thai Lekise brand enters Vietnam market

Lekise Lighting Co, Ltd., one of the largest producers of lamps and lighting equipment in Thailand, recently signed an exclusive dealership agreement with the Machinery & Electrical Appliances Joint Stock Company (TODIMAX) located in Ho Chi Minh City.    

The deal designated TODIMAX as the sole agency authorised to retail Lekise brand lighting products to consumers in the Vietnamese market.

Speaking at the signing ceremony, a TODIMAX representative said it would begin retailing the lighting products to its stores and supermarkets nationwide. Later, these products will be used for civil engineering projects, the industrial sector and public lighting systems and interior decoration.

Lekise’s lighting products have incorporated the latest of Japanese technological advances and exported to 40 nations around the globe.

Branding key to export growth, experts advise

It's becoming urgent for businesses to invest in branding to help them penetrate and expand their markets better during global integration.

The Viet Nam Chamber of Commerce and Industry and Trade (VCCI) and the Association of Vietnamese Retailers jointly organised a workshop yesterday on investing in branding and spending on advertisements, in response to a recent proposal to remove the cap on advertising expenses.

Experts from the Nation Consultancy pointed out at the workshop that the export of raw materials and products, which often helped a third party to make profits, and the lack of foreign market information and knowledge were among the major problems of Viet Nam.

Viet Nam continued to fail in building a clear image of the country's export products, especially agricultural products, which were being exported without branding, while many low-quality products exported under Vietnamese brand names were destroying the nation's prestige.

Experts pointed out that these problems would lead Vietnamese products to have low added value and low ability to engage in the value chain.

Stephen Kreppel, an expert in nation branding in the Nation Consultancy, said that exports were important for the economic growth and prestige of Viet Nam.

Brands can be built with sustainable economic development, environment-friendly policies and social responsibility, together with natural and cultural heritage and the nation's pride.

He stressed the important roles of both the government and enterprises in branding, in which the government would play the role of a supporter, but would not interfere in brand management.

Enterprises should also have knowledge about potential markets and the consumers' taste to create high-profit products and build unique Vietnamese brands, he said.

Pham Thi Thu Hang, general secretary of VCCI, added that enterprises needed to invest further in developing their brands to have a worldwide reach.

PVN buys stake in petrochemical complex

The Viet Nam Oil and Gas Group (PVN) bought a 11 per cent stake in the National Chemicals Group (Vinachem) in the Long Son Petrochemicals Complex project on Monday.

According to both parties, the capital transfer, which was included in the government's restructuring plan national organisations, was approved by Prime Minister Nguyen Tan Dung in August.

The transfer of stake aims to use the investment to speed up the US$4.5-million Ba Ria-Vung Tau-based Long Son Petrochemicals project.

Before the transfer, PVN contributed 18 per cent of the project capital and Vinachem contributed 11 per cent. Thailand and Qatar's investment accounted for the rest 71 per cent. Now PVN contributes 29 per cent of the project capital.

The 400ha petrochemical complex, considered the biggest of its kind in Viet Nam, will be located in the Long Son Industrial Zone near the Long Son oil refinery. The project is in the preparation stage that includes building of infrastructure and selection of contractors.

It is designed to produce 2.7 million tonnes of polyethylene and polypropylene, the raw materials required for the production of polyvinyl chloride (PVC) and other kinds of chemical products, to serve the increasing demand from the domestic petrochemical industry.

According to PVN, the local industries require up to $2 billion worth of high-quality plastic resins annually.

The project is expected to complete in the second quarter of 2019. 

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