BUSINESS IN BRIEF 17/3

Vietnam Net

Rate cut raises hopes of property recovery

Industry insiders are hoping the central bank’s decision to trim the interest rate by 1 per cent will breathe life into the country’s dormant property market.

A recent Ho Chi Minh City-based survey showed the market lacklustre performance in recent months was not because supply was outrunning demand or massive roll-outs by investors, but due to tightening credit over a prolonged period.

“Strangling credit has hurt the market. Firms have found it hard to get loans or have obtained loans at high lending rates, driving up input costs and then pushing up end product prices.

Meanwhile real home-buyers have not dared to take loans for house purchases with lending so costly,” said Dr. Le Xuan Nghia, National Financial Supervisory Committee deputy chairman.

Nghia asserted the property market could quickly revive once this issue was tackled.

General director Hoang Anh Tuan at Tac Dat Tac Vang Real Estate Joint Stock Company said once mobilising rates were eased and putting money into banks lost its charm, more people would inject their cash into more lucrative channels like stocks and the property market.

“We still do not know when lending rates will be eased and could it make easier for firms to get loans after Central Bank decided to cut rates by 1 per cent point. This is good news, indicating the government’s policies to rein in inflation are starting to bring rewards,” said Hoang Anh Sai Gon Real Estate Company general director Doan Chi Thanh.

Former deputy minister of Natural Resources and Environment Dang Hung Vo said the [property] market had to some extent restructured itself after a long hibernation.

“The market will bounce back with better credit lines. However, the low-end housing segment will pick up more rapidly because of huge demand while the high-end segment will continue to see slow movement,” said Vo.

Transport firms struggle with higher petrol prices

The current hostile business climate is hurting transport firms, especially in the wake of the recent hike in petrol prices.

With a fleet of 75 buses running fixed routes, the largest challenge for director Nguyen The Hung at Thai Binh Bus Joint Stock Company is how to prevent the company’s revenue from further sliding without raising fare prices.

Hung saw the diesel oil price surge VND1,000 (4.7 cents) per little (tantamount to 5 per cent) recently.

“We will strive to cut other expenses to keep fares stable though the actual costs are up 2–3 per cent,” said Hung.

Based on current oil prices, the fares for fixed routes under 150 kilometres should be lifted by VND2,000 (9.4 cents) per passenger to cover firm actual costs, according to chairman of Thang Long Transport Cooperative Bui Danh Lien.

But Liem said the rise in petrol costs was insignificant compared to the efforts the cooperative would have to make to print new tickets and the expenses associated in wading through current cumbersome procedures for price adjustment registration pursuant to Ministry of Transport regulations.

Vietnam Auto Transport Association chairman Nguyen Manh Hung agreed, saying local transport firms should not consider raising fares in the near term as the impacts of the recent upsurge in diesel oil price – the main fuel of bus fleets – remained minuscule.

There has been a sharp fall in the number of people using buses after the peak Lunar New Year period in late January 2012. According to Hanoi Bus Station Management Company, more and more buses are carrying few passengers.

For goods transport, big firms producing commodities often sign contracts with transport firms for six month or one year. Whether charges for these services will go up, or by how much, depends on negotiations between relevant parties.

“It is unlikely that goods consigners would willingly hike fares in the face of a lacklustre economy and sliding goods volumes,” said Hung of Thai Binh Bus Company.

Unlike firms transporting passengers and commodities on fixed routes taxis faces particular pressures.

Hanoi Taxi Association chairman Do Quoc Binh said taxis firms would have to think about upping fares in coming days after the price of one litre of petrol rose VND2,100 on March 7, 2012.

So far, only Mai Linh Group, which is set to hike fares by VND500–VND800 per km, is the only taxi firm to announce rises.

Under Circular 129/2010/TTLB enacted by inter-ministries of Transport and Finance, the fares for passenger and goods transport on fixed routes as well as taxis fares are set by firms themselves, conforming to state-regulated principles and price calculation methods.

“In fact, recent diesel oil and petrol price upsurges are within the tolerance levels of transport firms. However, if personal vehicle fee collection in urban cities and fee collection for the road maintenance fund take place this year, it could be a real blow on road services providers,” Binh said.

HCMC makes slow progress in relocation houses

The HCMC government’s newly-announced plan to 12,500 resettlement apartments may be slow to be executed because of other foot-dragging projects.

Before carrying out this plan, the municipal authority has had to urge the Department of Construction to review current resettlement housing projects as well as submit ideas to select investors and investment methods in order to complete the plan next year.

The construction department is also to carry out a program to build 11,000 resettlement apartments on 30 hectares in the south of the city.

Initially, the city will invest in power, water and traffic infrastructure at several resettlement areas such as Phuoc Kieng Commune of Nha Be District and Phong Phu Commune of Binh Chanh District developed by South Saigon Development Corporation (SADECO) and Binh Chanh Construction Investment Shareholding Company (BCCI) respectively.

Investors have been asked to advance money to build infrastructure and other components to ensure their projects are on schedule. The city will pay back later.

According to a directive on the development of the 11,000 apartments signed by HCMC vice chairman Nguyen Huu Tin last Tuesday, the city needs to construct homes for officials, workers, students, low-income people, and especially re-settlers.

In early September in 2009, 21st Century International Development Co. started work on a resettlement project of 4,200 flats in Binh Khanh Ward in HCMC’s District 2.

Covering about 30 hectares, the US$350 million scheme comprises 10 blocks of 20-25 stories.

The Binh Khanh resettlement project is considered one of the 3 biggest projects in HCMC, with 12,500 condos used for resettlement in the new urban area Thu Thiem. Once the scheme is complete, the investor is entitled to use one part of the housing and land fund there.

The project owner said the project would be finished after 30 months of construction to meet the accommodation demand of 16,000 residents. However, the project hasn’t made any progress for the past 2 years.

The same situation is also seen at the project to improve urban quality near Thu Thiem Bridge on Nguyen Huu Canh Street in Binh Thanh District invested by Construction JSC No. 5.

The project includes apartment and leasing office buildings of 35 stories and a resettlement condo building of 24 floors with a total of 500 flats.

The construction of the scheme has still fallen behind schedule even though it was planned to be implemented from 2007 to 2015.

HCMC authorities have considered buying the unsold apartments of commercial projects citywide to supplement the municipal resettlement housing fund.

The city’s Vice Chairman Nguyen Huu Tin had discussed such a policy with the association, said Le Hoang Chau, chairman of the HCMC Real Estate Association (HoREA), at the meeting with the association’s members last month.

The association has also been informed by the city’s construction department of the plan to purchase mid-sized apartments from 40 to 70 square meters each.

HCMC is now in need of building resettlement houses for households who will be relocated to clear sites for key projects such as the Thu Thiem New Urban Area, East-West Highway and Northwest Cu Chi Urban Area.

Still, a resettlement housing project will take a couple of years for completion, from site clearance to infrastructure construction.

Meanwhile, many property companies still have a considerable supply of available housing products.

Thus, if it’s carried out, the policy will add more units to the city’s resettlement housing fund while property firms are able to sell their products.

Chairman Chau of HoREA said the city’s government would ensure profits for project owners, and there was a high possibility that this policy would be deployed.

But it’s unclear how many units the city would buy.

Several enterprises however are concerned about how the city would pay for the purchase since the financial procedures would be cumbersome.

The central property management agencies have yet to publicize any official statistics on the unsold apartments on the national market. Nevertheless, a research of CB Richard Ellis Vietnam (CBRE) show there are over 18,000 unsold units in the so-called mid-end apartment segment alone as of last year’s end.

Savills secures exclusive sales deal for Ho Guom Plaza

Savills Vietnam has been appointed as the exclusive sales agent for Ho Guom Plaza, which is being developed by Ho Guom Garment Joint Stock Company in Mo Lao residential township in Hanoi’s Ha Dong district.

Stretching over an area of 11,000 square metres, Ho Guom Plaza features a modern residential tower and a Grade-A office tower, both of which are set above a retail podium. Ho Guom Plaza provides a full range of high-end facilities for its residents including supermarkets, swimming pools, a fitness centre, a green landscaped area, a children's play area and underground parking.

Located in the centre of expanded Hanoi and near a group of recently developed residential projects, Ho Guom Plaza is poised between the central business district and the newly expanded Western Hanoi and is one of the city’s most eagerly awaited properties.

Featuring 29-storey twin towers, Ho Guom Plaza offers a retail podium of over 23,000sqm, a 3-level parking basement of 20,000sqm, an office tower of 36,000sqm and a residential tower of 460 apartments ranged from 73 to 146sqm and eight penthouses.

The development has been implemented with the involvement of leading foreign and local partners including Iroplan (Germany), Savills (United Kingdom), Eyecadcher (Denmark), HBS (Vietnam), ADC (Vietnam) and KTS (Vietnam).

Guy Major, national director of residential sales, Savills Vietnam said: "With a proven track record in real estate consultancy, we always go with the developer right from the initial stages of a project’s development. We are honoured to team up with Ho Guom Garment Joint Stock Company, a pioneer unit with outstanding achievements in various fields, to develop this project.

Ho Guom Plaza is a significant development, showing the dynamics and development of Ho Guom in this time of renovation. Along with Ho Guom’s steady progress in real estate development, we are also committed to working tightly with the developer to offer the market perfect housing products."

Gov’t should stop intervening in fuel price management: expert

Fuel price management should be allowed to be fully determined by market forces, rather than lying under the administrative intervention of the government, Doctor Nguyen Duc Thanh told Tuoi Tre.

Dr Thanh, who is the director of the Center for Economic and Policy Research under the Hanoi University of Economics, said once the fuel price is operating according to market forces, consumers will no longer suffer from “shocking price hikes.”

In the latest case, consumers were stunned to see gasoline prices soar by VND2,100 a liter to VND22,900 (US$1.1) a liter on March 7.

Thanh said the increasing fuel prices, plus the expected 10-percent hike in the power price, may cause inflation to rise by 1.6 percentage points.

“We have always tried to tame fuel prices, but such effort has created other troubles for the economy,” said Thanh.

In increasing fuel prices, the government showed that they have failed to stabilize prices any longer, which all fuel stations had realized in advance.

“That was why they stopped sales to force the administrative authorities to announce the price hikes, since there was no other choice.”

With the government only increasing prices when they were no longer able to keep them stable, prices have violently soared, instead of slightly going up in accordance with actual market development.

“That was when the shocking price hike emerged, forcing prices of other commodities to skyrocket.

“It is time for the government to stop their intervention to prevent prices from soaring.”

In 2009, the government approved decree no 84, stipulating that fuel price management operate according to market forces.

Specifically, if prices rise by 7 percent, fuel businesses are allowed to adjust domestic prices through their initiative, and only have to inform the Ministry of Finance and the Ministry of Industry and Trade about the adjustments.

However, due to the rising inflation, the government has made use of a clause in the decree which stipulates that “in case the price hike can affect the eco-social development, the government will release measures to stabilize fuel prices” to repeatedly intervene in price management.

Consequently, despite the new regulation, fuel prices have been under the old management over the last few years.

Under the government’s effort, fuel prices have been increased on a less regular basis, but prices skyrocketed most of the time when they were adjusted.

On February 24, 2011, gasoline prices shot up by VND2,9000 a liter, while normally prices would drop by only VND500 a liter.

Dr Thanh said that if fuel prices in Vietnam were allowed to be determined by market forces, the government can focus on other key measures to curb inflation.

“It will also keep consumers away from getting shocked by the price hikes,” he said.

“Moreover, this will create a healthier market for fuel, and help curb speculation.”

Regarding the concern that without the government’s stabilization, fuel prices can put more pressure on the country’s inflation, Thanh said fuel prices in many countries are still higher than in Vietnam, but they have much lower inflation, only 2-6 percent a year.

“This means fuel is not the basic cause for inflation in Vietnam,” he said.

Thanh admitted that the fuel price stabilizations over the last few years have assisted consumers in cutting expenses for fuel.

But the stabilization only lasted a short time, he added.

“The stabilized prices have little meaning to consumers, since prices have later increased drastically to recoup for the losses incurred when they were prevented from rising,” he explained.

“We should allow consumers to get acquainted with the rising-falling prices movement in accordance with global developments.”

Resettlement condo projects face uncertainty

The HCMC government’s newly-announced plan to build several thousands of condos to replenish the resettlement housing fund is predicted to face uncertainty given the presence of several large-scale apartment schemes still mired in slow execution.

With the program to construct 12,500 resettlement apartments, the municipal authority has urged the Department of Construction to review the actual situation and assess the implementation progress of on-going resettlement housing projects. The department needs to submit to the local authority solutions to select investors and suitable investment methods in a bid to complete the plan by late next year.

The local authority has also told the construction department to carry out a program to build 11,000 resettlement apartments in the south of the city. It is expected 30 hectares will be set aside for high-rise condo building development in in Nha Be and Binh Chanh districts.

Developers have been asked to advance their finances to build these schemes and to sell their resettlement housing funds to local authorities later.

In early September in 2009, 21st Century International Development Co. started work on a resettlement project of 4,200 flats in Binh Khanh Ward in HCMC’s District 2. Covering about 30 hectares, the US$350 million scheme comprises 10 blocks of 20-25 stories.

The Binh Khanh resettlement project is considered one of the three biggest planned projects in the city, with 12,500 condos used for the resettlement purpose in the new urban area Thu Thiem. Once the scheme is complete, the investor is entitled to use one part of the housing and land fund there for its own business.

The project owner said at the ground-breaking time it would finish the project after 30 months of construction to meet the accommodation demand for some 16,000 residents. However, the project has had no progress over the last two years.

The same situation is also seen at the project to improve urban quality near Thu Thiem Bridge on Nguyen Huu Canh Street in Binh Thanh District invested by Construction JSC No. 5.

The project includes apartment and leasing office buildings of 35 stories and a resettlement condo building of 24 floors with a total of 500 flats. The construction of the scheme has still fallen behind schedule even though it was planned to be implemented from 2007 to 2015.

Northern economic corridor development plan approved

Minister of Industry and Trade Vu Huy Hoang has approved a plan for the industrial development of the Lang Son – Ha Noi – Hai Phong – Quang Ninh economic corridor until 2020, with a vision to 2025.

The plan focuses on developing eight industry groups.

For example, northern Lang Son Province will improve its mining sector, cement production, electricity, auto assembly, timber processing, electronics and so on.

Bac Ninh and Ha Noi will develop electronics, technology, pharmaceuticals and food processing.

Ha Noi will also establish centres, such as high-tech zones and industrial zones, in order to facilitate projects to produce and assemble consumer goods.

Hung Yen and Quang Ninh provinces and Hai Phong City will join hands to become a centre of thermal power in the north.

In order to develop industries along the economic corridor, the Ministry of Industry and Commerce has also compiled a list of 55 major investment initiatives, including 13 energy projects.

The Ministry also proposed that eight People's Committees in the area review the plan for industrial development and adjust local initiatives to ensure effective implementation and avoid overlapping jobs.

Thai investors to explore opportunities in HCM City

A Thai delegation will visit Vietnam to seek investment opportunities in Ho Chi Minh City, according to the Board of Investment of Thailand (BOI).

The Director of the BOI’s Foreign Investment Cooperation Office, Wassana Mututanon, said that the Thai delegation will meet with executives from HCM City Chamber of Commerce to help Thai entrepreneurs learn about Vietnam's economic situation and explore investment opportunities in the neighbouring country.

The Thailand Business Association (TBA) in Vietnam will also hold a seminar on investment opportunities in Vietnam for Thai entrepreneurs. Furthermore, Thai investors will also have an opportunity to visit a Thai-Vietnamese joint venture.

The upcoming field trip to Vietnam is part of the BOI’s policy to promote Thai trade and investment in neighbouring countries, such as Cambodia, Laos, Myanmar and, especially Vietnam.

Increasing pressure for inflation control

The soaring prices of essential goods are challenging Vietnam despite its effective implementation of measures to curb inflation and stabilize the macroeconomy.

In the first two months of this year, the consumer price index (CPI) dropped to a record low of 2.38 percent while the interest and exchange rates remained stable and the stock market showed positive signs of recovery.

However, the increasing prices of coal, electricity, petrol, and basic salaries are still putting a lot of pressure on the Government’s efforts to contain inflation.

In early March, the prices of petrol and gas rose by 10 percent to VND22,900 (US$1.1) per litre and VND50,000 (US$2.5) per 12-kg cylinder, respectively. The price of electricity is also forecast to increase by 10-15 percent.

The Ministry of Finance (MoF) estimates that the CPI will experience a 0.37 percent increase if electricity goes up by 5 percent in price.

Since the beginning of the year, many businesses have had to stop operating due to soaring input costs and industrial growth of 3.9 percent, a record low in many years.

Nguyen Tien Thoa, Director General of the MoF Price Management Department, said synchronous measures are needed to maintain the inflation rate at less than 9 percent.

It is crucial to control the prices of goods and services, such as electricity, gas, petrol, and hospital fees, he said.

Former Minister of Trade and Member of the National Advisory Council for Financial and Monetary Policies Truong Dinh Tuyen said the current credit interest rates are still too high and inaccessible to businesses.

According to the Advisory Council, Vietnam should focus on curbing inflation and improving liquidity by reducing bank deposit and loan interest rates.

It seems difficult to maintain the single-digit inflation rate if the price of petrol keeps increasing. And the authorities will have to do their best to meet the people’s expectations.

How to keep the rate of inflation at around 6 percent in the remaining months of 2012 remains an open question.

Online tea trade exchange between Vietnam and Pakistan

An online tea trade exchange between Vietnam and Pakistan took place in Hanoi on March 12.

The event was organized by the African, West and South Asian Markets Department under the Ministry of Industry and Trade (MoIT), in co-ordination with the Vietnam and Pakistan Tea Associations.

The online exchange aimed to help Vietnamese and Pakistani businesses overcome the shortage of information and establish initial direct contact.

During the exchange, businesses discussed recent cooperation between the two countries in tea trading, and market trends in 2012, including prices, quality, methods of payment and contract implementation.

They pointed out advantages and challenges to tea imports and exports, and worked out solutions to boost tea trading.

According to Ly Quoc Hung, Head of the African, West and South Asian Markets Department, Pakistan imported 17,582 tonnes of tea, mostly green and herbal tea, from Vietnam in 2011, worth US$32 million. So far this year, it has already consumed 3,100 tonnes of Vietnamese tea, mainly green, processed and dried tea, valued at US$49 million.

Hung noted that the MoIT has devised some measures to support Vietnamese businesses in exporting to Pakistan including shifting economic mechanisms, developing markets, and reforming finance policies. It has helped businesses invest in infrastructure, improve the quality of human resources, and increase their competitiveness in order to promote relations with the Middle East until 2015.

Last year, two-way trade turnover between Vietnam and Pakistan rose by 33.9 percent compared to 2010. Vietnam’s exports to the market reached US$168 million and it imports rose to US$156 million. Vietnam mainly exports cloth, fibres, pepper, tea, seafood, rubber, steel and chemical products to Pakistan.

Hanoi to host Vietnam-France financial economics forum

The 9th Vietnam-France financial economics forum on planning suburban areas in Vietnam will be held in Hanoi on March 19-20.

Economic experts, researchers and architects will analyze policies in Vietnam and speak about different perspectives for sustainable urban planning.

Vietnamese and French representatives will also present the challenges big cities in Vietnam are facing as a result of the country’s rapid urbanization since late 80s.

Suburban areas of big cities are considered hotspots for a number of economic, social, and environmental issues.

In addition, delegates will exchange ideas on public finance, energy and sustainable development in urban planning and management.

Thai investors to explore opportunities in HCM City

A Thai delegation will visit Vietnam to seek investment opportunities in Ho Chi Minh City, according to the Board of Investment of Thailand (BOI).

The Director of the BOI’s Foreign Investment Cooperation Office, Wassana Mututanon, said that the Thai delegation will meet with executives from HCM City Chamber of Commerce to help Thai entrepreneurs learn about Vietnam's economic situation and explore investment opportunities in the neighbouring country.

The Thailand Business Association (TBA) in Vietnam will also hold a seminar on investment opportunities in Vietnam for Thai entrepreneurs. Furthermore, Thai investors will also have an opportunity to visit a Thai-Vietnamese joint venture.

The upcoming field trip to Vietnam is part of the BOI’s policy to promote Thai trade and investment in neighbouring countries, such as Cambodia, Laos, Myanmar and, especially Vietnam.

Vietnam builds cassava powder processing factory in Laos

The Thanh Hoa General Materials Joint Stock Company broke ground on a cassava powder processing project in Bolikhamsay, Laos on March 12.

Present at the event were Chief of Bolikhamsay province, Pannoi Mani, Vietnamese Ambassador to Laos Ta Minh Chau and many officials from Vietnam’s Ha Tinh, Thanh Hoa provinces.

Pannoi Mani expressed sincere thanks to the Vietnamese Party, Government and people for wholeheartedly assisting people in Bolikhamsay province to carry out many projects effectively.

He said the cassava powder factory is one of many events to celebrate the Vietnam-Laos Friendship Year 2012.

The Vietnamese Ambassador asked the Thanh Hoa General Materials Joint Stock Company to ensure the construction progress and quality of the project in line with Laos’ local procedures.

Covering an area of 26.78 hectares, about 400km far from Vientiane capital, the factory has an estimated capitalization of US$4 million and a design capacity of 100 tonnes of products per day.

After 18 months of construction, the factory is scheduled to go into operation in late 2013, creating jobs for 100 labourers.

Project to improve government’s management launched

A project to enhance the Government’s effectiveness was discussed at a conference in Hanoi on March 12 by the Central Institute for Economic Management (CIEM) and the Swedish Embassy.

Participants examined the goals and contents of the project, which consist of three parts, including renewing the Government’s structure, changing the working methods and improving personnel quality.

CIEM Vice Director Vu Xuan Nguyet Hong said the project will help renovate the apparatus of the Vietnamese Government through specifying its role, function and missions in national socio-economic development during 2012-2020 and onwards.

Improving operational efficiency of the entire system is another objective of the project, she said.

The Director of the Office of Government’s Department of Administration and Civil Services said the Office of Government, as one of the project participants, will start its renewal in institutional vision during its policy consultation to the Prime Minister and other government agencies.

He said he hopes the project will contribute to strengthening the management system as well as increasing the working effectiveness of the government in the future.

Demand rises for high-grade rice

With the winter-spring rice crop being harvested in the Cuu Long (Mekong) Delta, high-grade varieties of paddy are much in demand while low-quality IR 50404 does not have many buyers.

Undried long-grained, fragrant paddy is being bought for VND5,000-7,200 (US$0.24-0.35) per kilogramme while IR 50404 is fetching VND4,000-4,200, though farmers are unhappy as they cannot sell much of the latter after having a bumper crop.

Nguyen Van Be, a farmer in An Giang Province's An Phu District, said he had harvested seven to eight tonnes of IR 50404 per ha from his three ha.

But he could not find buyers even after lowering the price.

Be said buyers were scrambling for high-quality varieties like jasmine and VD 20 instead.

As a result, paddy was heaped on roads along fields in many communes in Long An and Tien Giang provinces.

According to the Ministry of Agriculture and Rural Development, more than half of the 1.6 million ha of winter-spring rice has been harvested with an average yield of 6.5-7.5 tonnes.

Although the Cultivation Department had instructed farmers to plant IR 50404 on less than 20 per cent of the area under the crop, it turned out that they grew it on more than 50 per cent of the area in the delta, and even 70 per cent in some places.

Pham Van Bay, deputy chairman of the Viet Nam Food Association, said despite the high prices, demand for fragant rice had exceeded supply.

Traders and exporters are looking to buy jasmine and fragrant rice to process into 5 per cent broken rice for export to Hong Kong, Taiwan and the Middle East.

Pham Van Du, deputy chief of the Cultivation Department, said farmers should plant low-quality rice on just 15 to 20 per cent of the area, and high-quality and fragrant varieties on the rest.

The department has been creating new varieties with similar characteristics as IR 50404 but with higher quality to replace it.

Dr Le Van Banh, head of the Mekong Rice Research Institute, said it took time to introduce and popularise such new varieties in the delta.

VN goods on display in Phnom Penh

A trade, services and tourism expo promoting the theme "Vietnamese Products-More Choices-Much Trusted" will be held from March 28 to April 1 at the Mondial Centre in Phnom Penh.

The five-day Ho Chi Minh City Expo 2012 is organised by the HCM City Investment and Trade Promotional Centre (ITPC) with support from Viet Nam's Ministry of Industry and Trade, the HCM City People's Committee and Cambodia's Ministry of Commerce.

Huynh Tan Phong, deputy director of the ITPC, said more than 150 Vietnamese companies would display their goods in 250 booths.

Apart from the stalls, the event will cover an area that introduces the economic, political and social achievements of Viet Nam and Cambodia and highlights the friendship and solidarity between both countries. The expo will also provide Cambodian and Vietnamese enterprises with opportunities to meet each other and explore the possibility of doing business together.

The ITPC will also organise market surveys of the financial, real estate, construction and retail sectors for Vietnamese businesses seeking to understand the Cambodian market better.

Nguyen Thi Hong, deputy chairwoman of the HCM City People's Committee, said that the expo would be one of the key trade promotion programmes of HCM City that target the Cambodian market during the 2010-15 period.

The programmes aim to broaden the market penetration of Vietnamese goods, develop distribution networks, and promote Vietnamese brands in Cambodia.

Sluggish outlook for motorbike market

The domestic motorbike market could go into a long period of gloom with prices forecast to decrease further in the coming months, the Nguoi Lao Dong (The Labourer) newspaper reported on Saturday.

Shops selling motorbikes on HCM City's Ly Tu Trong, Nguyen Tri Phuong, An Duong Vuong and Phan Dang Luu streets had a sorry look about them these days as they waited for customers, the report said.

Leading manufacturers like Honda, Yamaha and Suzuki have launched many new models like New Wave, Nouvo "Fifth Generation" and Hayate 125, offering more options, and there are many new imported motorbikes from Thailand and China as well, but sales have been slow.

Tran Dinh Phuc, owner of a motorbike shop on Nguyen Tri Phuong-An Duong Vuong Street, said that the shops were currently competing with each other on price and offering various promotions, however the discounts had failed to attract enough customers.

The difficult economic situation that has forced customers to tighten their belts and the failure to find why many motorbikes and cars have burst into flames and been destroyed over the last year or so have combined to suppress sales, industry insiders say.

Since the beginning of this year, prices of both homemade and imported bikes have decreased by between VND500,000 (US$24) and VND1 million ($48) per unit. For instance, the price of the Lead motorbike has gone down by VND500,000 ($24) to VND37 million ($1,778), while Vision is priced at VND30 million ($1,442), down VND1 million ($48).

Meanwhile, the Vespa LX125, made by Piaggio Viet Nam, now sells for VND72 million ($3,461) per unit, a decrease of VND3 million ($144).

The prices of some imported motorbikes, including the SH, have also decreased by $300 to $8,000-8,400 per unit, while Air Blade Thailand can be purchased for VND74 million ($3,557), a drop of VND7 million ($336.5).

The PCX Thailand and LX150, imported from Italy, now cost VND85 million ($4,086) and VND82 million ($3,942), a decrease of VND2 million ($96) and nearly VND5 million ($240.3), respectively.

E-savings service opens at ABBank

The An Binh Joint-Stock Commercial Bank (ABBank) has launched an e-savings service to allow customers to make transactions through a deposit or A+ account with On-line Banking Services.

Intended for the Vietnamese dong only, this service includes money transfers, withdrawals and account monitoring, among others.

E-savings is oriented towards businesspeople who work frequently with computers.

Cai Lan expands petroleum depot

PetroVietnam Oil Corp (PV Oil) has started its expansion of the Cai Lan industrial zone's petroleum depot in northern Quang Ninh Province.

The project is expected to expand the storage capacity of the depot from 10,000 to 70,000 cubic metres. During this same phase, PV Oil will also build a port for ships holding up to 15,000DWT (deadweight tonnage) to facilitate distribution of petrol products from the depot. The VND264billion (US$12.57 million) project has been completely funded by PV Oil.-

Mercer to conduct salary survey

Talentnet Corporation, a representative of Mercer company in Viet Nam, plans to conduct its annual Viet Nam Total Remuneration Survey.

With 329 participants from prestigious local organisations and foreign companies and remuneration data from 90,282 employees and 1,197 positions, last year's remuneration survey was acknowledged as the most comprehensive salary-survey report ever made in Viet Nam.

The Total Remuneration Survey report provides information on salary increase rates, common allowances and bonuses by industry, employee turnover rates, the most difficult positions to attract and retain, and the compensation mix for each level of staff.

Companies participating in this survey will be given advice on how to evaluate salaries and jobs in accordance with the Mercer standard, an international standard system.

VN honey now chemical free

Quality honey is eligible to be imported into the US market, Nguyen Thi Hang, vice-chairwoman of the Viet Nam Bee Raising Association, has said.

Hang's clarification follows news that US importers late last year rejected 600 tonnes of honey from Viet Nam.

Hang said the US remained the country's major importer of honey. In 2011, Viet Nam exported 27,000 tonnes to the US, she said.

The Ministry of Agriculture and Rural Development said the honey was rejected because it exceeded the permitted level of the anti-fungus additive carbenzamin. The rejection affected 35,000 beekeepers throughout the country.

However, the ministry said the mistake was not directly that of beekeepers. The herbicide was used in rubber, cashew and coffee farms in the region where bees pollinated.

The ministry said it was willing to invite authorised US representatives to Viet Nam to clarify the origin of products as well as examine quality control processes for exported honey.

Vinalines told to speed up project

Deputy Prime Minister Hoang Trung Hai has asked the Ministry of Transport to oversee work on the ship-repair complex being built by Viet Nam National Shipping Lines (Vinalines) in the south.

The project is part of the Government's master plan on developing the country's ailing ship-repair sector, according to the Government Office.

The Government hopes the complex will help to meet increasing demand for freight transport, particularly among Vinalines fleet.

Meanwhile, the Government Office stated the complex would not be allowed to operate as a fuel and chemical terminal.

Vinalines last year shipped 36.8 million tonnes of cargo, up 1 per cent against the previous year, backed by increasing export volumes of coffee, cocoa, garments, seafood and steel.

The carrier this year plans to reach a turnover of VND27.2 trillion (US$1.3 billion), a 10 per cent year-on-year increase, of which profit would account for $5.7 million.

Massive funding sought for HCMC transport

The city plans to apply diverse forms of investment to effectively mobilise the capital needed beyond its budgetary allocations for implementation of key transport infrastructure proj-ects, a senior official says.

Several of these projects were facing a cash crunch, the Sai Gon Giai Phong (Liberated Sai Gon) newspaper reported yesterday, citing Tran Quang Phuong, director of the city's Department of Transport.

The investment models that the city should apply included official development assistance, build-operate-transfer (BOT), build-transfer (BT) and private-public partnership (PPP), he said.

Phuong said in the next 10 years, the city would implement more than 40 transport infrastructure projects under BT model with a total investment of more than US$10 billion.

It would also carry out 10 other projects under both BT and BOT models with a total investment of nearly $4.5 billion, he said, adding that the city had listed projects that would be developed under the different investment forms.

These include the project to build an outer ring road in the eastern part of the city from Phu My Bridge to Rach Chiec Bridge; a traffic circle in Area A of South Sai Gon; and an elevated road starting from the traffic circle to Phu My Bridge.

Another project is to build the Sai Gon 2 Bridge, invested in by the HCM City Infrastructure Investment Join-Stock Company, which would start construction next month.

District -level People's Committees had been asked to take responsibility for delays in site clearance work and expedite the process, Phuong said.

Many major traffic infrastructure projects had been delayed due to the lack of investment capital and tardy site clearance work, he said.

The delay was likely to continue for many projects given the current economic slowdown, Phuong said.