Asiana Airlines to own 50% of Kumho Asiana Plaza

A 50% stake in the commercial center and hotel complex Kumho Asiana Plaza Saigon in HCMC will be acquired by Asiana Airlines, said Won Il Woo, president and CEO of Kumho Engineering & Construction.

“This is an internal deal within Kumho as it is being made between its two subsidiaries, Asiana Airlines and Kumho Engineering & Construction,” he said at a meeting with HCMC vice chairman Le Manh Ha on Thursday.

He asked about the necessary procedures under Vietnamese law for this deal. “We don’t know if we have to report to the central agencies in Hanoi, or if reporting to HCMC is enough,” he wondered.

In response, Vice Chairman Ha said the municipal government would review the project document next week and then give appropriate guidelines.

“Normally, the authorities that license a project will handle changes in that project. However, when it comes to real estate, there are complicated regulations, so a careful review is needed,” Ha explained.

At the end of the meeting, Won said the chairman of Kumho would visit Vietnam next week. “He will meet HCMC leaders and directly mention this deal,” he said.

The US$225 million Kumho Asiana Plaza Saigon project was completed in October 2009. Located at 39 Le Duan Boulevard, District 1, it consists of a 21-story hotel of five-star standards with 300 guest rooms and three 32-story office and apartment buildings.

Kumho Asiana Plaza Saigon is a venture between South Korea’s Kumho Engineering & Construction with a 65% stake, and two local partners – Saigontourist and HDSC – with a combined 35% stake.

Western Union kicks off mobile money transfer service

Western Union Company on Thursday announced that customers in Vietnam can now receive and manage their international remittances around the clock with their cell phone by registering their Viettel mobile number for Military Bank’s MB Mobile Money service and providing their numbers to family and friends overseas.

Thanks to the new service, customers from 110 countries can now enjoy the option of sending a Western Union Mobile Money Transfer transaction to Vietnam from more than 215,000 participating agent locations; or from the website WesternUnion.com, according to a statement of Western Union.

Recipients in Vietnam can access and manage their remittances through this mobile account anytime, anywhere using their mobile phone.

They can transfer the funds to any account at 10 banks in Vietnam, or use the funds to pay for bills.

Military Bank currently has 240,000 Bankplus users who are entitled to the MB Mobile Money service.

Le Hai from Military Bank said in the statement that his bank has worked with Western Union for many years, offering money transfer services at the bank’s retail branches across Vietnam.  Enabling its consumers to receive Western Union remittances through their mobile phones is another step forward in its successful collaboration with Western Union.

“Consumer preferences to send and receive money are changing with emerging technologies. It is very necessary to offer an alternative channel for consumers to access traditional service. This newly launched mobile money transfer service is a perfect example of how extended service meets consumers’ changing needs,” he said.

VinaPhone, MobiFone merger remains uncertain

The Ministry of Information and Communications has yet to approve a restructuring plan submitted by Vietnam Post and Telecommunications Group (VNPT) a year ago on a merger between VinaPhone and MobiFone mobile networks.

Speaking with the Daily, Deputy Minister of Information and Communications Le Nam Thang said the ministry would now send the restructuring plan to related agencies for feedback before reaching a final decision.

At a recent meeting held by the information ministry, VNPT asked the ministry for a timely decision on the tentative plan. This is the first time that VNPT has publicly mentioned the matter.

Pham Long Tran, chairman of VNPT, told the meeting that the renovation model of organizing business and production has been sent to the ministry and the Government. However, he said, there has been no response from the authorities regarding the issue so far.

It is vital for VNPT to carry out reforms to have a much more effective operation, Tran noted. The group in 2012 only achieved growth of 10%, with VND8.5 trillion in profit, equal to the average level of global telcos but lower than that of other local telecom firms of the same scale.

Minister of Information and Communications Nguyen Bac Son affirmed that his ministry needs to scrutinize the restructuring, citing its importance in terms of finance and manpower. A decision will be made by the ministry as soon as Government inspectors announce inspection results of the plan, Son added.

Local firm says smartphone market will grow strongly

Local demand for smartphones will grow strongly this year, Hung Cong Hien, director of the electronics products trading center under FPT Trading Company said, citing their decreasing prices.

Hien noticed that more Vietnamese are inclined to buy smartphones as their prices are getting cheaper.

“The local smartphone segment posted growth of nearly 50% last year and it is expected to continue to grow strongly in the near future,” he noted. FPT Trading in August 2012 joined forces with Lenovo to launch low-cost smartphones onto the local market, he said.

“This is just our initial step but we have gained sales growth that is much better than expected,” he noted.

According to Hien, FPT Trading will speed up distribution of Lenovo-labeled smartphones in the local market, with each priced from VND2.5 million to more than VND6 million. The products run on a new version of Android and use MTK microprocessor.

Along with FPT, many other mobile and telecom services providers are also in the race to distribute smartphones.

Viettel early last month opened 23 outlets in HCMC and Danang. The stores feature high-class and low-cost items like HTC OneX, Samsung Galaxy SIII, Nokia Lumina 610 and 900 and Samsung S Galaxy S Duos. Customers will be given preferential Smart fee package monthly with up to 1,000 minutes of calls plus 2GB Internet access depending on products.

Similarly, local mobile phone firm MobiStar has just introduced Kem 462 brand and Qmobile has offered Qsmart S12 buyers early this month.

A recent report of market research company IDC Vietnam shows that the sales volume of smartphones in Vietnam recorded the highest in the third quarter last year, with domestic firms taking the lion’s share. Specially, local firm Qmobile is in the top five of smartphone producers at home, IDC’s report says.

Power price hikes inevitable

After its announcement last year of a VND6 trillion profit, Vietnam Electricity Group (EVN) said it would have to cover greater expenditures this year, meaning a new bout of price hikes is inevitable.

The State-owned group predicted it would suffer a loss of some VND6 trillion for buying diesel oil to generate electricity for the southern region during this year’s dry season.

Meanwhile, the price of coal sold to the power sector will rise. Therefore, EVN will have to spend an additional VND6 trillion buying coal this year.

With these expenses, plus the accumulated losses of about VND34 trillion from previous years and other costs in 2013, power prices would continue rising this year, heard a review conference of Southern Power Corporation (EVN SPC) in HCMC on Thursday.

Hoang Quoc Vuong, chairman of EVN, said Vietnam National Coal and Mineral Industries Group had proposed a coal price hike. So, the additional sum that EVN will pay for coal will be over VND6 trillion this year, VND16 trillion next year and VND21 trillion a year later.

The Prime Minister has given the nod for power prices to be adjusted in line with higher prices of coal sold to the power sector. However, he has asked EVN to draw up a transparent plan on its production and business activities, said Vuong.

Speaking to the Daily, EVN general director Pham Le Thanh said the group would have to produce more than two billion kWh of electricity from diesel oil, which would cost a lot.

“It costs VND4,000-5,000 to generate one kWh of power from oil, while the selling price is over VND1,000 per kWh, so with two billion kWh to be produced from oil, EVN will incur a loss of VND6 trillion,” he said.

He predicted the demand for power in March-May this year would be very high. The southern region almost has no backup capacity, so power outage is likely.

The nation’s total capacity is around 26,300 MW, while the demand is only 20,000 MW this means there is a surplus in capacity.

However, the southern region relies on power transferred from the north and the central. Due to problems with transmission lines and water shortage in hydropower reservoirs this year, the power supply situation is more stressful in the south.

EVN is doing everything possible to limit power outages in the southern region, said Thanh. The group has requested regional power corporations to ask big power-consuming customers like cement, iron and steel producers to operate during off-peak hours in order to reduce power generation from diesel oil.

In addition, EVN will install a capacitor of 1,000-2,000 amperes to increase load capacity, and build a 500-kV transmission line to transfer electricity to the south.

Besides, EVN is developing many big power plants in the southern region, such as Vinh Tan 2, Duyen Hai 1, Duyen Hai 3 and the second generator of O Mon 1. Vinh Tan 2 is scheduled for operation in early 2014, while Duyen Hai 3 and the second generator of O Mon 1 will be operational in 2015.

Saigon Co.op still rejects CP chicken eggs

Although CP Vietnam Corporation from today will continue to cut chicken egg prices for its agents, Saigon Co.op supermarkets still decline to buy eggs from CP, asking the livestock products company to promise not to raise prices again.

According a statement released on Thursday, CP Vietnam said to cut the retail price of a pack of 10 chicken eggs from VND23,000 to VND21,000 starting today, the third price cut in the past three days.

However, Bui Hanh Thu, deputy general director of Saigon Co.op, told the Daily that this supermarket chain had yet to resume purchases of eggs from CP.

“Saigon Co.op has surrogate suppliers and there is no need to buy eggs from CP. I don’t know how long CP maintains this price and when the company increases prices again,” Thu said. Saigon Co.op snubbed CP’s price cut on Wednesday.

Thu said that CP should apologize to consumers and pledge to make egg prices stable.

Emivest Vietnam Company on Wednesday also admitted that they had caused an unreasonable price hike and pledged to cut the price to VND20,200 per pack of 10 chicken eggs starting from Saturday.

Vietnam’s top 500 businesses revealed

A ceremony to honor the top 500 Vietnamese largest enterprises (VNR 500) in 2012 took place in Hanoi on January 18th by the Vietnam Report Joint Stock Company (Vietnam Report), in association with the VietnamNet Online Newspaper.

The VNR 500 ranking, similar to the US Fortune 500 Model, mainly based on corporate sales, acknowledges and honors their achievements.

To be on the list of VNR 500, an enterprise should have minimum sales of above VND 1,400 billion.

Accordingly, the Vietnam National Oil and Gas Group (PetroVietnam) ranked first on the list, followed by the Vietnam National Petroleum Corporation (Petrolimex), the Vietnam Posts and Telecommunications Group (VNPT), the Samsung Electronics Vietnam Company, and the Joint Venture VietsoPetro.

HAG puts $100 mln Laos sugar project into operation

Vietnam’s Hoang Anh Gia Lai Group (HAG) inaugurated Thursday the Hoang Anh Attapeu sugar and sugarcane industrial cluster, and a namesake thermal-power center in Laos’ southern Attapeu Province after 14 months of construction.

Hoang Anh Attapeu sugar and sugarcane industrial cluster is seen in Attapeu, Laos.

The plant, with a 3,000 ton per day capacity, has produced the very first batch of refined white sugar, while the 30MW thermal-power center, fueled by the bagasses from the sugar refinery, has also generated electricity into the Laotian national power system, the cluster director Nguyen Ngoc Anh said.

The Hoang Anh Attapeu broke ground on November 22, 2011, with a total investment of $100 million.

It also includes an ethanol plant with a capacity of 30,000 ton per year, and a fertilizer plant with a capacity of 50,000 tons a year.

These two facilities are expected to become operational by the end of the second quarter.

HAG has been strongly boosting its investment in neighboring countries in recent years.
It is expecting to earn billions of US dollars in the next five years, with the $300 million initial investment in Myanmar this year.

“The realty developer will give priority to the development of its $300 million complex in Yangon in 2013 following the groundbreaking of the project after the Lunar New Year,” chairman Doan Nguyen Duc said in a statement.

Steel giant hurries projects

The Viet Nam Steel Corporation is hastening construction its new plant in northern Lao Cai Province as well as the second phase of its Thai Nguyen Iron and Steel Co expansion project.

A worker packages steel bars at Thai Nguyen Iron and Steel joint stock Corp (TISCO). The National Steel Corporation is hastening construction of two key projects to help increase the corporation's competitiveness next year.

As scheduled, the former would be completed by the end of the year and the latter to begin operations by June.

The two key projects would help increase the corporation's competitiveness next year, said Minister of Industry and Trade Vu Huy Hoang.

He added that the ministry was working with relevant agencies to ensure the timely completion of the Thai Nguyen project.

At an industry conference this week, Hoang urged Viet Nam Steel to focus on renewing technology to conserve energy and to reduce costs and pollution. He also called for concerted efforts towards an appropriate production plan for the current year.

According to Viet Nam Steel deputy director Vu Ba On, the company has targeted to produce 1.4 million tonnes of steel billet this year, an increase of 12 per cent over 2012, and another 2.5 million tonnes of rolled steel, an increase of over 7.5 per cent.

To meet the targets, the corporation has called for Government policies to stimulate demand in the construction industry and lower borrowing costs, On said.

He said that stronger technical barriers were also needed to prevent further imports of low-quality steel and protect domestic producers from unfair competition.

The corporation's output of steel billet last year reached nearly 1.3 million tonnes, an increase of 5.2 per cent over the previous year, yet only about 260,000 tonnes were sold.

Rolling steel output meanwhile rose by 9.5 per cent to 340,274 tonnes, while demand reached nearly 295,000 tonnes

On said that last year was the most difficult year for the nation's steel industry due to the frozen real estate market and resulting slowdown in the construction industry.

Another bridge crossing the Han River put into operation

Nguyen Thi Ly Bridge crossing the Han River was officially topped out on January 19th after 3 years of construction by the Da Nang City People’s Committee and the Ministry of Transport at a cost of VND 1.5 trillion.

This 6-lane bridge of 35 meters wide and 731m long has a total loading capacity of 32,000 tons – the world’s current biggest figure .

The birdge, expected to be fully operational by March 29th on the 38th anniversary of the Da Nang Liberation Day, would ease the traffic congestion at the Eastern gateway of the City.

Gold bar trading needs better management

A week after newly-licensed gold bar trading businesses began operations, the domestic gold market saw positive changes, but several problems emerged requiring timely adjustment from managerial agencies.

The first positive sign recorded was the narrowed disparity between domestic and world gold prices after the State Bank of Vietnam (SBV)'s regulation on gold bar trading, which took effect on January 10. Moreover, the rights of gold bar buyers will be protected by the State when they purchase gold bullion at licensed stores.

However, an apparent problem arose when the SBV restricted gold bar trading which was uneven distribution of gold bar trading points across the country.

More than 1,300 trading points out of the total 2,500 licensed points concentrate in Hanoi and Ho Chi Minh City and the remainder is mainly located in big provinces and cities including Hai Phong, Quang Ninh, Can Tho and others. A large number of localities have only two to four trading points, which are placed in the centre of its provinces or cities. As a result, local people at many localities, especially at remote communes have to travel a long way, some even hundreds of kilometres to find a gold bar trading point.

Because of the narrowed trading system, the market has seen a shift towards trading other kinds of gold, such as jewelry and gold rings that bear similar features to bullion, hallmarked with a company's brand and seal. This type of gold rings is 99.99% pure gold and traded near SJC gold bar price. As there are no restrictions on gold rings, people can buy them at any trading points. Although the SBV advises people not to trade in gold bar at unlicensed stores, illegal trading still occurs.

Gold businesses are not interested in opening gold stores at remote and rural areas because of low trading volume, high investment cost and low profits. However, storing gold is a legitimate need of the people in both urban and rural areas. Therefore, the SBV should urgently implement the next steps to gradually eliminate 'blank areas' of gold bar trading. Along with policies to encourage licensed businesses to establish trading network in remote areas, the SBV should impose compulsory sanctions to those who only invest in big provinces and cities.

In addition, qualified gold bar trading businesses need to co-operate with their partners and State authorised agencies to create a legal trading network while meeting customers' need and protecting their rights.

DHL extends pickup cutoff time for southern Vietnam

DHL Express, the world’s leading express service provider, today announced a 45 minutes extension to the pickup cutoff time for customers located in southern Vietnam.

The change will see counters extending their cutoff times to as late as 17:45hrs for most areas within Ho Chi Minh City, essentially ensuring a full business day, from Monday to Friday, for customers looking to send packages and documents internationally.

"DHL Express has been operating in Vietnam for almost 25 years," said Yasmin Aladad Khan, senior vice president, DHL Express Southeast Asia. "With all of this history behind us here and our experience from working with Vietnamese customers, we understand what they need and are constantly striving to offer them value added services. The extension of the pickup cutoff times not only allows us to make the day a little longer for the manufacturers, who are the backbone of Vietnam's export economy, but it also underscores our capabilities to offer timely and reliable services to our customers."

"The benefits from the later departure of our flight will be channeled to our customers in Ho Chi Minh City, Long An, Binh Duong, Dong Nai and Vung Tau, which encompass some of Vietnam's main manufacturing and industrial zones. Our unprecedented access to the company’s Asia Air Network will see DHL offering the latest pickup cutoff times for same day uplift in comparison to other international express companies operating in Vietnam’s southern provinces. As International Specialists, DHL is always at the forefront of facilitating trade between Vietnam and its partners around the world," said Christopher Ong, DHL-VNPT Express general director.

The latest service enhancement is part of DHL’s ongoing effort to provide ease of trade for Vietnamese businesses and to ensure sustainability and scalability of the local businesses in the international scene.
 
Alstom to supply main equipment for key substations

Alstom has signed two €16 million contracts with the National Power Transmission Corporation (NPT), a subsidiary of Vietnam Electricity Group (EVN) to supply primary equipment and materials for the 500/220kV My Tho and Vinh Tan substations.

According to these contracts, Alstom will provide all electrical materials and equipment, as well as supervisory services for the 500/220 kV air-insulated substations.

The 500kV My Tho and Vinh Tan substations are key projects for infrastructure development in southern Vietnam.

Once completed, the My Tho substation will provide electricity for the Mekong Delta region.

The 500kV Vinh Tan substation will connect the Vinh Tan thermal power complex, the biggest thermal power complex in Vietnam, to the national power grid, with a planned total capacity of 5,600MW.

The 500kV My Tho and Vinh Tan substations will be the first in Vietnam to use a rated short circuit current of 63 kA - 3s for primary equipment, as per the new requirement set by the Vietnam Ministry of Industry and Trade to improve the reliability and stability of the national transmission network.

Michel Burtin, Alstom country president in Vietnam, said these contracts highlighted Alstom's leading position in the high voltage switchgear market as well as its long-term commitment to support Vietnam’s power development plan.

“We are very pleased to continue to be a key partner in the rapid development of the electricity infrastructure in Vietnam," Burtin said.

Alstom Grid has provided competitive and reliable solutions to the Vietnamese market for more than 20 years.

Alstom is a global leader in the world of power generation, power transmission and rail infrastructure and sets the benchmark for innovative and environmentally friendly technologies.

The group employs 92,000 people in around 100 countries. It had sales of €20 billion and booked close to €22 billion in orders in 2011 and 2012.

Alstom Grid has 130 years of expertise in electrical grids. Whether for utilities or electro-intensive industries or facilitating the trading of energy, Alstom Grid brings power to its customers’ projects.

Alstom Grid ranks among the top three in electrical transmission sector with an annual sales turnover of more than €4 billion.

The province of Dak Lak in the Central Highlands has suspended 67 wood processing facilities after they were found to be committing several violations.

The province is suffering from increasing deforestation and illegal encroachment on forest land and local authorities have been cracking down on environmental offenders, mobilising military forces to help protect the nature.

The latest enterprises to be suspended have been found to be undertaking construction activities in and around forest land, buying and selling timber without legal permission and causing environmental pollution.-

HCM City’s January CPI edges up 0.44 percent

Ho Chi Minh City ’s consumer price index (CPI) in January edged up only 0.44 percent against the previous month, a fairly low rate given that the Lunar New Year is drawing near.

According to the municipal Statistics Office, eight out of 10 commodity groups measured registered a hike in prices.

The highest price rise of 1.43 percent was recorded in food. Prices of foodstuffs and restaurant services went up 0.17 percent and 0.09 percent, respectively.

Meanwhile, prices of transport, post and telecommunications and other services dropped compared to last month.

In December, 2012, the city’s CPI leaped 0.17 percent month on month.

Seen as the country’s largest economic hub, HCM City is aiming for a yearly CPI increase lower than the country’s proposed 8 percent rate in 2013.

For the year, the city has set targets of a 9.5-10 percent GDP growth rate and a GDP per capita of 4,000 USD.

Deputy PM asks jewelry firms to be more creative

Deputy Prime Minister Hoang Trung Hai praised the excellent work of individuals and groups in contributing to the development of Vietnam ’s gemstones, jewelry and handicraft industry at a ceremony on January 20.

He awarded a Labor Medal, third class, to Do Minh Phu, chairman of Doji Gold & Gems Group.
Deputy PM Hai emphasised that the gemstones, jewelry and handicraft industry has a lot of potential and holds a strong competitive edge that should be capitalised on during the process of global integration.

However, he called for industry craftsmen to be more creative in their designs, saying that the majority of products had been made manually on a small scale that in turn lowered the productivity and the competitiveness of the businesses.

The Vietnam Gemstones, Jewelry and Handicraft Association was founded in 1989, operating nation-wide and accommodating 12,000 companies and 33,000 individual members.

HCM City promotes green technology

Ho Chi Minh City will soon launch the fourth annual campaign “Green Consumption” in a bid to improve people’s awareness of environmental protection and help businesses who invest in green technologies.

In 2012, around 200 firms were investigated for allegedly harming the environment and 67 of them were found violating environmental laws. They were fined over 3 billion VND (148,000 USD), and eight of them were shut down.

Despite the fact that the penalty has increased sevenfold to 500 million VND (23,800 USD), many companies continue with their polluting ways.

In the last three years, the campaign attracted more than 9,000 youths and over 1 million other people who pledged to use green products.

A new feature in this year’s campaign will be a public vote for the best green products and enterprises.

Every citizen will be encouraged to join the campaign by sharing images of things they did to participate. The best photos will receive prizes.

“Green Consumption” has proven to be an effective campaign and is hoped to spread nationwide.

Siemens signs multi-year contract extension for service and maintenance at Phu My 3 power plant

Siemens Energy Service has been awarded a Long-Term Service Program (LTP) contract extension for Phu My 3 combined-cycle power plant. The facility is a build-operate-transfer (BOT) financed 740-megawatt (MW) power plant located in Ba Ria – Vung Tau Province, Vietnam.

It began commercial operation in 2004 and supplies Vietnam with clean power generated by highly efficient gas turbines. With this contract extension, Siemens will service the power station’s major equipment for a period of approximately eight more years once the gas turbines have reached 100,000 equivalent operating hours.

Mr. Do Ba Canh - General Director of Power Phu My 3 BOT Power Company (left), Mr. Diertmart Skownronn, Senior Project Manager of Siemens (middle) and Dr. Thai Lai Pham, CEO of Siemens Vietnam (right). Photo: Siemens

Siemens will provide comprehensive maintenance services for the plant’s two SGT5-4000F turbines, one SST5-5000 steam turbine and three generators.

The long-term maintenance contract will help to ensure safe and reliable operations over the lifecycle of the Phu My 3 power plant by providing predictable maintenance costs and extended warranty coverage, as well as the supply of original equipment manufacturer (OEM) spare parts and professional outage management.

"We are very pleased to extend our long-term contract with Phu My 3, one of our key customers in Vietnam. We feel honored that they continue to choose Siemens as their service partner. With our premium products and service, the power plant has been running efficiently since 2004, and we’re committed to sustaining this record and to making further contributions to the development of energy sector in Vietnam," said Dr. Thai Lai Pham, CEO of Siemens Vietnam.

Phu My 3 is the first large-scale BOT gas-fired power plant which contributes to more reliable base load and more diversification of energy sources in Vietnam.

It serves as a successful model for the development of an integrated gas for power project and involves the transfer of technology and best practices in power plant operation, as well as in environment, health and safety management.

It is operated by Phu My 3 BOT Power Company Limited, which is jointly held by British Petroleum (BP), SembCorp Utilities Pte. Ltd. and the consortium of Kyuden International Corporation and Sojitz Corporation.

Supermarkets ready for Tet rush
 
Supermarkets participating in the city's price stabilisation programme have increased their supply of essential goods to meet demand in the run-up to Tet (Lunar New Year) holiday.

Co.opmart chain said it expected purchases to rise three to fourfold in Tet, thus it has increased supply of essential goods by four times compared to normal months to ensure adequate supply during the holiday.

The supermarket chain had stocked 11,000 tonnes of rice, 3,800 tonnes of sugar, 4,400 tonnes of cooking oil, 5,100 tonnes of animal meat, 2,370 tonnes of poultry meat, 2,250 tonnes of processed foods, 9 million of eggs and 490 tonnes of seafood. Besides, essential items that are sold at 10 per cent lower than the market price under the city's price stabilisation programme, Saigon Co.op will slash prices by 10-50 per cent on other certain items.

It also plans to organise at least 150 mobile sales trips to the city's remote districts as well as industrial parks and export processing zones to serve buyers.

Similarly, the supermarket chain Big C has increased its supply of goods by 15 per cent compared to last year's Tet period to ensure supply and stable prices.

It is also offering a discount of up to 50 per cent on nearly 3,000 Tet products until February 2.

Big C as well as Co.opmart are also improving home-delivery services and increasing the number of cashiers and security officers in order to ensure the convenience and safety for customers.

Many electronic shops in HCM City, including Nguyen Kim, Thien Hoa and Cho Lon, are offering attractive discounts on TVs, cameras, mobilephones and electronic household appliances to support customers.

Big C said it had prepared 25 per cent more Tet gift baskets compared to the number during the holiday last year.

For this year, it launched 24 kinds of gift baskets and boxes at prices from VND59,900 to VND4.9 million. Many kinds of baskets containing goods made in Viet Nam are exclusively distributed by Co.opmart supermarkets.

The gift baskets were designed by Saigon Co.op and the High Quality Vietnamese Products Business Association. They are priced from VND150,000 each.

In addition, Co.opmart has implemented a programme to offer 10,000 Tet gift baskets at prices 15-30 per cent below-market for workers at industrial parks and export processing zones.

Co.opmart expects that its revenue this Tet will increase nearly 25 per cent compared to the same period last year.

Government policies forecast to shake up property market

The property sector is expected to get a strong injection of credit in 2013 thanks to a resolution the Government issued recently.

Resolution No 02/NQ-CP spells out a number of potential solutions to overcome difficulties face by the business sector, revive the market, and resolve bad debts.

One of the measures urges the State Bank of Viet Nam to direct State-owned banks to earmark a reasonable quantum of funds, equivalent to at least 3 per cent of their total loans, to help low-income earners, Government workers, and military personnel buy or lease houses.

This amount is expected to be VND20-40 trillion (US$960.6 million-1.92 billion) and the credit will carry a moderate interest rate and for terms of up to 10 years.

The central bank will provide refinancing.

People looking to buy houses of less than 70 square meters and costing VND15 million or less per square meter can get mortgages at low interest rates. Developers of social housing projects can also get credit at reasonable rates.

Tran Hoang Ngan, member of the National Advisory Council for Financial and Monetary Policies, said the new policies are likely to revive the low-priced apartment and housing segment.

He suggested keeping lending rates for people with a real need for housing at 5-6 per cent.

Tran Bac Ha, chairman of the Joint Stock Commercial Bank for Investment and Development of Viet Nam, or BIDV, told Dau Tu (Investment) newspaper that central bank policies should encourage banks to lend to house buyers.

For one, these loans should not be grouped along with credit provided to property developers, he said.

For another, these loans should be deducted to calculate banks' compulsory reserves, he said.

If these are done banks can lower interest rates on mortgages and increase lending, he said.

Vo Van Chau, advisor to TrustBank, said the possibility of high credit growth in the housing segment is great this year since the central bank has lifted restrictions on loans to non-production sectors.

Tran Anh Tuan, general director of NamA Bank, agreed, but warned that banks should be cautious and monitor the quality of these loans since the housing market is still in a slump and risks remain high.

Besides, the sources of financing remain thin, with funds coming mainly from banks and people's savings. Thus, developers and buyers people do not have access to medium- and long-term credit, he pointed out.

Tran Du Lich, member of the National Advisory Council for Financial and Monetary Policies, urged developers to continue cutting the prices of their products to attract more individual customers and revive the market.

City looks at ways to increase exports

In the very first days of the New Year, HCM City authorities unveiled measures to promote the city's exports that will, in turn, boost economic development and stabilise production.

According to the city's Department of Industry and Trade, HCM City's goods have been exported to 228 countries and territories after four new overseas markets were added in 2012.

The global economic turmoil has affected the city's exports as well as local markets due to declining purchasing power. As a result, a large volume of products including electrical goods, automobiles, bicycles and construction materials are in stock.

The department says 33 of the city's 57 manufacturing sectors attained high year-on-year growth rates in 2012. The furniture sector grew 41.7 per cent; electric wires and cables, 17.4 per cent; dairy products, 12.3 per cent; breweries, 10.2 per cent; and plastics, 6.9 per cent.

In 2012, the HCM City-based companies earned total export revenues of US$21.56 billion, up three per cent while imports amounted to $26.13 billion, down 4.6 per cent over 2011.

The growth in the city's export turnover was not as high as the 14-15 per cent target set by the HCM City People's Council for last year.

To boost exports in 2013, HCM City authorities plan to restructure the sector. They want to boost shipments of high value-added products, increase the proportion of manufacturing and processing sectors, create new products with highly-skilled labour and reduce exports of raw materials and semi-processed products.

The city will also expand its overseas reach with diverse partnerships and effective trade promotion campaigns to efficiently exploit all possibilities and promote exports to both established overseas markets and new ones.

The city has also co-operated with Vietnamese embassies, consulates and trade representative offices to provide information to companies doing business in these countries, helping them map out appropriate policies for each country.

This year, it will continue to collect business information and provide the same to companies to help them boost trade promotion activities.

The city will focus its market research on big markets including Japan, the US, China and the European Union while reducing the number of studies and surveys on smaller markets.

To create favourable conditions for exports, the city will further develop and improve export-related services including increasing the loading capacity of its ports and easing customs formalities.

Executives abscond

Agencies regulating foreign direct investment are unsure about how to deal with investors who have gone AWOL.

A one-hectare factory belonging to South Korean-owned UTC Vina Ltd. at the Amata Industrial Park in Bien Hoa city has been abandoned since its Korean boss decamped nearly four years ago following internal disputes.

Despite their best efforts, Dong Nai authorities have been unable to find the investors or make contact with the boss of the $31 million factory.

According to the Dong Nai IP Authority, there were 42 such cases accounting for 4.7 per cent of all foreign-invested companies in the province. This left over 3,800 workers without jobs. These companies have a total registered capital of $142 million.

Pham Minh Thanh, deputy director of the province's Social Insurance, is not hopeful about collecting the premium arrears of VND8.5 billion ($407,000) for 1,651 workers at these abandoned firms.

The southern province of Binh Duong faces a similar situation. According to the province's Taxation Bureau, the bosses of 32 FDI firms, or 3.04 per cent of the total number in the province, have absconded.

These firms owed VND58 billion ($2.8 million) in import-export tax arrears.

According to the Binh Duong Department of Planning and Investment, the boss of the Korean-invested Ado Vina Co Ltd has left behind an unpaid salary bill of VND245 million ($12,000).

Le Viet Dung, the department's deputy director, said most such factories are rented facilities and have worn-out production lines, and are of little value.

In addition to tax arrears, the runaways have also left behind considerable debts including unpaid salaries and social insurance premiums for their employees, he said.

Losses leading to financial problems and internal disputes are the main reasons for people absconding.

But in some cases they sought to profit from loopholes in regulations, especially investment incentives, before leaving.

According to the Binh Duong customs, after importing 176 consignments of raw materials for furniture and interior decoration, the Taiwanese boss of Diing Long Viet Nam Ltd. in Binh Duong sold them in the local market before fleeing, leaving behind unpaid import taxes of VND24 billion ($1.2 million).

"We do not have comprehensive legal documents to prevent price transfer and other fraud while many foreign investors have studied Viet Nam's legal system," Phan Huu Thang, director of the FDI Research Centre at the National University of Ha Noi, said.

Egg price hikes

Dong Nai-based C.P Viet Nam Livestock Co Ltd and Binh Duong-based Emivest Feelmill Viet Nam Co, the two major suppliers of poultry eggs to HCM City, have admitted to "unreasonble" price hikes.

City officials have said that if they fail to provide an explanation for the hikes and it is found that they were colluding in the act, appropriate legal action will be taken and the violators duly punished.

During a meeting with the authorities of HCM City and Binh Duong Province last Wednesday, Emivest admitted that the unreasonable price hikes have caused chaos in the local markets over the last two weeks.

The same day, the company lowered its prices to VND23.200 per ten-egg carton and pledged to further reduce it to VND20,200 per carton on January 19, equal to January 1 prices.

Emivest also pledged to stabilise prices of poultry eggs and other foodstuff including poultry meat until the Tet (Lunar New Year) festival (which falls on February 10 this year).

Speaking at the meeting, Dao Thi Huong Lan, Director of the HCM City Department of Finance, said Emivest's action in inreasing egg was illegal.

She asked the taxation agency of Binh Duong Province to assess the extra revenue earned by Emivest through the illegal egg price hikes and force the company to return it to State coffers.

Lan said that HCM City will also report the illegal price hikes by C.P and Emivest to concerned ministries and propose punishments for both companies.

Le Ngoc Dao, Deputy Director of the HCM City Department of Industry and Trade, said despite the illegal price increases by some suppliers, companies that had joined the city's Price Stabilisation Programme had continued to supply enough eggs to meet customers' demand in the city.

Under pressure exerted by HCM City authorities and Co.opMart Sai Gon, last Wednesday, C.P Viet Nam reduced its prices in the southern markets to VND21,600 per ten-egg carton, VND700 to VND800 lower than the prices three days earlier.

However, egg prices remained high in the northern markets after C.P increased them four times in the past month. On January 16, traditional markets in the north sold chicken eggs at VND2,800 - VND3,100 per egg and duck eggs at VND3,100 - VND3,300 per egg.

Nguyen Tien Dung, Director of Co.opMart Ha Noi, was quoted by the Sai Gon Giai Phong (Liberated Sai Gon) newspaper as saying C.P was yet to lower its prices in the North.

During a meeting with HCM City authorities last Monday, C.P admitted that it had unreasonably increased chicken egg prices from VND21,500 to VND29,500 per ten-egg carton and promised to adjust them in the following days.

C.P said at the meeting that between January 4 to 11, the firm had raised prices of chicken eggs from VND21,500 to VND29,500 per carton, or an increase of VND8,000 a carton within a week.

A C.P representative admitted this was an unreasonable move and said the company would take remedial action soon.

A farm owner Dong Nai currently working for C.P told the Thoi Bao Kinh Te Sai Gon (Sai Gon Economic Times) magazine that it costs VND1,500 to produce an egg, which is sold to C.P at VND1,550 under a long-term contract.

His farm supplies around 110,000 eggs to C.P every day. As he has signed a long-term contract, he cannot raise selling prices, even though other farm owners in Dong Nai and Binh Phuoc are doing so, he said.

Meanwhile, Dao said that in case the two companies fail to explain why they raised prices, his office, the HCM City Department of Industry and Trade, will propose that the Viet Nam Competition Authority under the Ministry of Industry and Trade and the General Department of Taxation launch an investigation.

The department suspects that that major livestock firms are joining hands to push up prices, and if so, they are violating the Competition Law, he added.

Banks shrug off diffidence over lending

Many banks in HCM City have begun lending aggressively in the new year with an eye on their credit growth targets for the year.

They have also begun lending to non-priority sectors, something they had refrained from for many months.

Sacombank has lent VND50 billion (US$2.4 million) to small and medium-sized firms, individuals, and households at moderate interest rates of 11-12 per cent.

It has also earmarked VND1 trillion ($48.7 million)for retail borrowers for buying, repairing, and building houses at 9 per cent per year for the first two months.

Several others like HDBank, Vietcombank, VIB, VPBank, Ocean Bank, and HSBC Viet Nam are also offering credit on easy terms, mostly consumer loans.

Vietcombank has earmarked VND2 trillion ($96 million) for personal loans at 13 per cent, and HSBC Viet Nam is offering home buyers loans at 9 per cent for the first three months.

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