BUSINESS IN BRIEF 9/4

09/04/2012
Vietnam Net

EVN to kick-start more power plants in April

Electricity of Vietnam group (EVN) is expecting to bring many power stations nationwide online within April.

EVN will put the fifth generator of Son La Hydropower Plant into operation, continue the trial runs of the 1st generator and complete the installation of the 2nd generator of Dong Nai 4 Hydropower Plant, begin the electricity generation of the 2nd generator of Kanak Hydropower Plant and ensure the progress of many other projects.

The load of electricity system may reach up to 331 million kWh a day and the biggest capacity will range between 16,500-16,900 MW.

EVN said in March 2012, the national power grid ran safely and stably, with the total output reaching 10.03 billion kWh.

Vietnam produced a total of 26 billion kWh in the first quarter of this year, making a year-on-year rise of 15.1 percent, according to the General Statistics Office (GSO).

EVN aims to increase produced and imported electricity output to 120.7 billion kWh in 2012, up 10.9 percent from 2011.

City to host garment industry expo

The 22nd Viet Nam Sai Gon Textile and Garment Industry Expo 2012 – Fabric and Garment Accessories will be held on April 11-14 at the Tan Binh Exhibition and Convention Centre in HCM City.

Local textile and garment enterprises will be able to purchase modern equipment and promote their "Made in Viet Nam" brand at the expo.

Since the 1990s, the event has been held 21 times in HCM City and Ha Noi and has become a key event for the textile and garment industry in Viet Nam.

Covering over 6,000sq.m of exhibition space, the four-day event will attract 260 exhibitors from 20 countries and regions all over the world.

This year, the number of Vietnamese enterprises and joint-venture enterprises in Viet Nam participating in this event will account for more than 30 per cent of the total exhibitors.

The exhibitors will display a range of products at more than 300 booths including raw materials and the latest technology and processing solutions for textile and garment operations. That will save production time, power and fuel.

Products include textile machinery, spinning machinery, yarn processing machinery, weaving machinery, looms, chemicals and dyes, cloth processing machinery, embroidery equipment, knitting machinery, and accessories.

Organisers said the expo would help increase the localisation rate of raw materials.

The exhibition is organised by the Viet Nam National Textile and Garment Group (VINATEX) in collaboration with the VCCI Exhibition Service Co. Ltd and Hong Kong Exhibition Services Ltd. It is expected to attract more than 15,000 visitors.

Medicines, milk products added to price stabilisation programme

The HCM City Department of Industry and Trade decided to add medicines, some milk products, and education-related items to this year's price stabilisation programme at a meeting on Thursday.

The programme will last from April 1 to March 31 next year.

Baby formula, milk for pregnant women, fortified milk products, notebooks, school bags and uniforms, and 13 groups of locally-manufactured drugs used to treat some common and chronic diseases join the list which already has nine essential items – rice, sugar, cooking oil, meat, poultry, eggs, processed foods, vegetables and fruits, and aquatic produce.

Besides, fragrant rice and jasmine rice have been added to the rice items in this year's programme.

Le Ngoc Dao, deputy director of the department, said the volume of goods sold under the programme would account for 25 to 50 per cent of their total supply in the market, a 15-30 per cent increase from last year.

Every month 5,650 tonnes of rice, 2,470 tonnes of sugar, 1,005 tonnes of cooking oil, 3,950 tonnes of pork, 3,150 tonnes of poultry meat, 1,315 tonnes of processed food, 1,700 tonnes of vegetables and fruits, 437 tonnes of seafood, and 24 million eggs will be supplied.

During Tet (the Lunar New Year) in early 2013, the supply of goods will increase by 10-15 per cent from a year earlier.

At the meeting, 48 more enterprises signed up for the programme to sell the four new categories of goods added to this year's list.

Some drug and dairy firms have even declined the interest-free loans offered by the city under the programme.

Despite the increase in the number of participants, the loan amount has dropped to VND332 billion (US$16 million), VND104 billion lower than last year.

Goods sold under the programme must comply with quality, safety and hygiene standards and help foster the "Vietnamese consuming Vietnamese goods" programme.

Dong Nai property sales heat up

Although the real estate market nationwide still shows no signs of recovery, property investors in the southern province of Dong Nai have been selling many land plots at the projects.

In late March, for example, the Dat Xanh Real Estate Services and Construction Corporation began selling 200 land plots at its Gold Hill Project in rural Trang Bom District, with prices ranging between VND2.9 million (US$138) and VND4 ($190) million per square metre.

All the lots were sold out on the first day, according to the corporation's chairman, Luong Tri Thin.

The market's purchasing power has surprised real estate traders.

In addition, the Kim Oanh Real Estate Joint Stock Company announced the sale of land plots at Bien Hoa Dragon City II Project in Bien Hoa City's Tam Phuoc Commune, at prices of between VND2.6 million ($125) and 3.8 million ($182).

Of the 250 plots that were sold, 70 per cent were sold on the morning of the first day of sale, according to the company's general director, Dang Thi Kim Oanh.

Earlier, Kim Oanh sold another 250 plots at this project within the first three days of sales.

Business is also brisk at the East Sai Gon Project in Nhon Trach District's Phu Thanh and Long Tan Commune.

Hoang Linh, director of the Hoang Linh Real Estate Co specialising in land sales in rural Nhon Trach District, said the number of customers interested in property projects in the locality had increased significantly.

The price of real estate projects in Nhon Trach fell by 30 to 40 per cent to VND1.5 million ($72) and VND2 million ($96) per square metre compared to several years ago.

Many people have decided to invest in real estate projects in Nhon Trach because the prices are reasonable and are not expected to drop.

One source said the expected opening of the Phuoc An Port had also encouraged people to invest in local property projects.

Market analysts said the Dong Nai Province's real estate market had good prices while technical infrastructure facilities there were well developed.

More importantly, Dong Nai is located at an important transport axis in the southern key economic zone, with many roads, waterways, railways and airways in the area.

Ha Noi flats continue to drop in price

Apartments for sale in Ha Noi continued to decline in volume and value for the first quarter this year, Savills Viet Nam Ltd has said.

A Savills Viet Nam report released on Thursday stated asking prices ranged from VND19 million (US$680) to VND64 million ($3,100) per square metre and the absorption rate had declined by 5 per cent to 7 per cent against the previous quarter.

Grade A continued to have the lowest absorption rate at 2 per cent, almost unchanged for three recent quarters. Grade C had the highest absorption rate at 11 per cent, decreasing 7 percentage points, followed by Grade B at 3 per cent, decreasing 9 percentage points against previous quarter.

Regarding the secondary market, the average secondary asking price decreased in most districts due to low liquidity since the second half of last year. Long Bien and Gia Lam had slight increases in secondary asking prices, which may be due to the opening of two large-scale shopping centres late last year, especially the opening of Big C in Long Bien District.

Savills Viet Nam said low-end and mid-range units were key products of the apartment market. Secondary units were preferred to primary ones due to secondary prices in most active projects being lower than the primary prices, with the difference ranging from 3 per cent to 32 per cent. Completed buildings, which were ready for living, attract more attention from buyers.

Meanwhile, during the first quarter, three projects entered the market with a total of 580 units. The total primary stock was approximately 9,800 units from 34 active projects, decreasing 4 per cent against the previous quarter.

The secondary stock had more than 56,000 units, increasing 2 per cent against the previous quarter. Western districts, namely Tu Liem, Ha Dong and Cau Giay, represent 53 per cent of total secondary stock.

The company expected 63 projects would come online in the next three years, of which 52 identified projects would provide around 45,600 units for the Ha Noi market.

Exchange-traded funds among world's best performers

Viet Nam's exchange-traded funds (ETFs) were among the three best performing in the world in the first three months of this year, along with Egypt and India, according to the ETF Trends report issued by the asset managers at Global Trends Investments.

The Market Vectors India Small Cap Index ETF topped the list of best performers in the first quarter, with an increase of 39 per cent in its net asset value (NAV), closely followed by Market Vectors Egypt Index ETF with a rise of nearly 34 per cent.

Market Vectors Viet Nam ETF (VNM), managed by Vaneck Global and with about 70 per cent of the fund allocated to Vietnamese corporations, ranked third. VNM witnessed a growth of around 30 per cent in NAV through March, largely recovering from a loss of 47 per cent last year.

Most of the shares in its portfolio climbed in value, of which shares of insurer Bao Viet Holdings (BVH) doubled in price. The fund's investment in Sacombank (STB) and Vietinbank (CTG) also contributed to its increased investment value. During the quarter, VNM bought 17 million STB shares worth US$20 million and an additional 5 million shares of CTG worth $8.5 million.

VNM's assets under management of VNM on Friday stood at US$306.1 million, according to the New York Stock Exchange Arca.

Emerging market ETFs could present investors with significant rewards, if they can handle the possible risks, Global Trends Investments president Tom Lydon said on the ETF Trends website. He said that risks facing Viet Nam included rising inflationary pressures, liquidity issues within the banking system and a growing trade deficit.

The London Stock Exchange-listed FTSE Viet Nam Index ETF, managed by Deutsche Bank, also enjoyed a high growth rate in the first quarter, with assets under management rising 47.6 per cent from $190 million to $281 million. The fund decreased its stake in real estate developer Vincom (VIC) from 24 per cent to 14 per cent, while adding 2.5 million STB shares to its portfolio.

Hai Phong port handles 11m tonnes of goods

In the first quarter of this year, goods transported via Hai Phong reached 10,902,000 tonnes, bringing in revenue of VND723.5 billion (US$34.45 million), 22 per cent against the same period last year.

The results stem from improved renovation, marketing as well as effectiveness in exploiting, providing, unloading and storing commodities as well as Hai Phong's pledge to enhance the speed of infrastructure and service investment.

Confab spotlights exports, trade fairs in Hong Kong

The Import-Export Support Centre in co-operation with the Hong Kong Trade Development Council earlier this week conducted a conference entitled "Export Promotion through Trade Fairs in Hong Kong".

This was a good opportunity for Viet Nam to lure investment and speed up trade with Hong Kong enterprises, said Le Xuan Duong, director of the Export Promotion Centre.

FDI businesses in Hung Yen pay $11.2 million in tax

Foreign direct investment (FDI) enterprises operating in Hung Yen Province paid VND234.8 billion (US$11.2 million) in tax during the first quarter of the year.

According to the provincial Department of Taxation, it was a 126.88 per cent year-on-year increase. Corporate income tax and value added tax reached VND108 billion ($5.1 million) and VND124 billion ($5.9 million) respectively.

Vietinbank strikes $20m financing deal with Unitel

A Laos-based branch of the Viet Nam Joint-Stock Commercial Bank for Industry and Trade (Vietinbank) and the Star Telecom Co Ltd, known as Unitel, reached agreement on credit finance worth US$20 million earlier this week.

Unitel is a joint venture between Vietnamese Viettel Global and Lao-Asia Telecom (LAT). With nearly 3,000 base transceiver stations (BTS), the Unitel network covers 17 cities and provinces in Laos.

Bank offers preferential credit to export firms

The Military Bank yesterday signed an agreement with the Viet Nam Chamber of Commerce and Industry (VCCI) to provide preferential credit of VND10 trillion (US$480) to export businesses nationwide to expand production and ease difficulties.

Nguyen Le Hien, head of the MB's Commerce Support Department, said the credit would focus on export businesses, which lack capital to sign contracts. They would be given preferentials in terms of cost and interest rate.

City stocks continue rising trend

HCM City stocks retained their increasing streak during yesterday's session, following the previous day's rumours that interest rates would be reduced.

"Although there hasn't been any official announcement, the rumours will still help boost trading," Bao Viet Securities Co analyst Nguyen Xuan Binh wrote in a Thursday note.

Meanwhile, deputy head of the State Bank of Viet Nam's Monetary Policy Department Do Thi Nhung said yesterday that interest rates would continue on the routine set before, decreasing by 1 percentage point in each quarter, the deposit rate targeting around 10 per cent by the end of the year.

"This information opens up opportunities for lending rates to be reduced to support businesses and, furthermore, the economy," noted Kim Eng Securities Co analysts. It should be noted that credit growth in the first quarter was 2.13 per cent negative, they added.

Despite the information, on the Ha Noi Stock Exchange, the HNX-Index reversed morning gains due to higher sell pressure, edging down nearly 0.2 per cent to 74.69 points.

Trading saw an increase of 8 per cent in value to VND845.9 billion (US$40.2 million) and 10.5 per cent in volume to 89.3 million shares.

The heaviest trades fell to Habubank (HBB) with 10.2 million shares exchanged. It tumbled 2.8 per cent to VND6,900 per share.

On the HCM City Stock Exchange, the VN-Index added 0.56 per cent to 447.44 points, while the VN30 rose 0.8 per cent to 511.51 points.

The value of trades soared 53.9 per cent compared to Thursday's level, hitting more than VND1.4 trillion ($66.6 million) on a volume of 91 million shares.

Real estate stocks had a well-performing morning, some reaching their ceiling prices, including Hoang Anh Gia Lai (HAG), Ocean Group (OGC) – two of the 30 leading shares by capitalisation and liquidity – and Hoang Quan Corp.

Meanwhile, the number of decliners increased as trading went to final minutes, with such blue chips as Petrovietnam Drilling Services Co (PVD), Vietinbank (CTG), Phu My Fertiliser (DPM) and steelmaker Hoa Phat retreating.

Tax incentives won't apply to all firms

Small and medium sized property enterprises did not qualify for a tax payment extension even if they completed all accounting documents and invoices under the law and registered to pay tax as declared, according to Document No 3898 issued by the Finance Ministry.

However, if businesses meeting the above conditions use a large number of labourers for the construction of socio-economic infrastructure projects, they will enjoy a 30-per-cent reduction of last year's corporate income tax under Decision No 08/2011/QH13.

Qualified infrastructure projects include electricity plants, water supply systems, roads, airports, seaports, schools, hospitals, and others.

Sapa to become an int’l resort by 2030

Sapa will become a resort site by international standards, aiming to welcome 3 to 4 million visitors until 2030 with an average growth rate of 7.2 percent per year.

The target is part of the urban planning project for Sapa tourism which has been announced by the Lao Cai provincial People’s Committee.

Accordingly, Sapa will not only be a national tourism and resort centre, but also an economic and cultural centre in the future. It also serves as a bridge for cultural exchange among ethnic minority groups in the northern mountainous and Vietnam-China border area.

Tran Huu Son, Director of the provincial Department of Culture, Sports and Tourism said Sapa’s tourism development target will be on community-based tourism. Therefore, it is important to help local residents do tourism services by providing training courses on English language and culinary arts.

The Sapa tourism complex and surrounding areas will include an urban centre with an estimated population of 13,000 people, a new urban area, a luxury resort, and Ham Rong mountain tourism site.

This is the result of a cooperation between the Lao Cai provincial People’s Committee and experts from France’s Aquitaine region to turn Sapa into a famous resort site by international standards.

Electricity price stabilization fund to set up

Deputy Prime Minister Hoang Trung Hai has assigned the Ministry of Finance to coordinate with other ministries and agencies to develop mechanisms for operating an electricity price stabilization fund.

Accordingly, the monthly calculation for electricity prices is based on the fluctuations of the input parameters including the exchange rate, fuel and electricity production structure.

Before the 20th of each month, EVN will have to finish the price calculation based on price fluctuations of basic input parameters.

Specifically, EVN will be allowed to deduct from the fund to stabilize prices.

If the cost of electricity generation still increases over 5 percent after EVN extracts funding from the stabilization fund, EVN will be allowed to increase electricity prices at 5 percent.

Forum discusses economic restructuring

International financial and economic organizations have raised the Vietnam Credit Index (VCI), indicating brighter prospects for the medium term.

Vice Chairwoman of the National Assembly (NA) Nguyen Thi Kim Ngan said this at a spring economic forum held in Danang on April 8 by the NA Economic Committee, the Vietnam Academy of Social Sciences, the Vietnam Chamber of Commerce and Industry and the United Nations Development Programme (UNDP).

During the two-day forum, domestic and foreign economic managers and experts discussed the results of socio-economic development plans in 2011 and proposed solutions for 2012.

According to experts, there remain problems, such as weak liquidity, the decline in foreign direct investment, gloomy real estate and securities markets and a large number of dissolved businesses.

Vietnam's GDP growth in the first quarter of this year is estimated at 4 percent, much lower than the same period last year.

Participants also exchanged views on Vietnam’s economic restructuring and growth model, especially restructuring state-owned enterprises, investment and financial institutions and the banking system.

Ms Ngan said experts forecast that it will be difficult for Vietnam to achieve as a high growth rate as in 2011. The urgent task now is to keep inflation to a single digit and maintain GDP growth of 6-6.5 percent in 2012.

She also urged participants to give frank opinions to help the NA and Government devise effective socio-economic solutions.

Laos-Vietnam Trade Fair opens

Nearly 100 businesses from Laos and Vietnam are showing their products at the Laos-Vietnam Trade Fair which opened in Pakse Town, Champasak province, Laos on April 7.

Present at the opening ceremony were Sonsay Siphandone, member of the Laos People’s Revolutionary Party and Champasak’s Governor; Nguyen Cam Tu, Vietnam’s Deputy Minister of Industry and Trade; and Khemmani Pholsena, Laos Deputy Minister of Industry and Commerce.

This is the first Laos-Vietnam trade fair organised in Laos under the framework of the Vietnam-Laos Friendship Year.

The fair provides a good chance for businesses from the two countries to introduce their products, and set up strong import-export networks.

Two-way trade enjoyed a year-on-year growth of 27 percent in the 2005-2011 period, hitting US$734 million in 2011.

The two countries are expected to raise their import-export value to US$2 billion by 2015.

State Bank targets lower rates

The State Bank of Vietnam (SBV) will lower the yearly interest rate to 12 per cent because of stable macroeconomic conditions, slowly increasing inflation, improved bank liquidity and credit.

Do Thi Nhung, deputy head of the SBV's Monetary Policies Department, made the statement at a conference to discuss capital solutions for small- and medium-sized enterprises (SMEs) in Vietnam in Hanoi on April 6.

Nhung said the monetary policies will remain under control. "We will reduce the interest rate by 1 per cent every quarter if the macro economy is favourable," she said, adding that the SBV targeted to lower the annual interest rate to 10-11 per cent, bringing the lending interest rate lower.

She said the SBV will ensure control on money supply at a reasonable level, supporting liquidity at commercial banks and increasing the total payment means to 14-16 per cent.

It will also adjust credit growth targets at credit organisations to retain the rate at 15 to 17 per cent this year.

Nhung affirmed that the SBV will continue to supply capital through open market operations (OMO) and refinance operations to support liquidity at commercial banks alongside flexible monetary policies to help SMEs access loans.

She proposed that commercial banks reduce business costs to create favourable conditions for reducing the interest rate, restructuring debts or reducing the interest rate at enterprises that have coped with difficulties and increase the proportion of mid- and long-term loans.

"The SBV has considered to provide a suitable lending proportion to businesses, organisations and individuals which have not been given priority to access to loans for consumption and buying houses," she said.

She added the SBV had allowed people who borrowed money to buy and build low-income houses to access loans at the beginning of this year.

Nguyen Thi Mui, director of the Vietnam Bank for Industry and Trade (Vietinbank)'s Human Resource Development and Training School, said the number of SMEs in Vietnam accounted for 97 per cent of the total while those in developed countries was 90 to 95 per cent.

Vietnamese SMEs have provided jobs for a half of the economy's labourers, contributing 40 per cent to annual GDP.

"However, their ability to access loans was only 30 per cent due to limited financial capacity," Mui said.

Statistics from the Ministry of Planning and Investment's General Statistics Office showed that the proportion of SMEs with charter capital of less than VND5 billion (US$240,400) was in the majority. Most businesses had small production capabilities, backward technology and limited finances.

She said 2012 will be a tough year for SMEs as, according to the competitive index released at the World Economic Forum, Vietnam's competitiveness in integration had exposed shortcomings.

"In addition, a lack of market information has created difficulties," she added.

A recent survey conducted by the Vietnam Chamber of Commerce and Industry showed that 26 per cent of surveyed businesses had coped with the issue.

Mui said several credit organisations had no trust in SMEs, creating difficulties in accessing loans, which often required mortage assets.

"Commercial banks should combine different products as a condition to lower the lending interest rate," she said, adding that they could apply a financial leasing model to access capital.

The director added that SMEs should improve finance and administrative management to gain trust from banks while being active in building suitable investment plans.

She recommended Government improve factors of institution and infrastructure, which could help enterprises reduce costs, promoting private investment.

An Giang helps Battambang develop agriculture

A delegation from Cambodia’s Battambang province, led by its governor Prach Chan, is visiting Vietnam’s southern province of An Giang to seek cooperative opportunities in agriculture and aquaculture development.

During a working session with An Giang provincial leaders on April 8, the two sides briefed each other on the socio-economic development in their provinces and affirmed they would create the best possible conditions for investors from both localities to do business.

Battambang has around 280,000 hectares of farm land, which is equal to that of An Giang, but its agricultural output is only 20 percent of An Giang’s figure.

Governor Prach Chan said he hopes that An Giang will share experiences in management and application of modern technologies and transfer rice cultivation and aquaculture techniques to Battambang. He also called on An Giang businesses to invest in agriculture in his province.

For his part, Secretary of the An Giang provincial Party Committee, Phan Van Sau, pledged to further strengthen cooperation with Battambang in agriculture, education, and health care.

An Giang is willing to help train officials and students from Battambang, Sau said.

During their stay in An Giang from April 6-8, the delegation visited the An Giang aquaculture breeding development centre, the Thuan An Company, Binh Duc breeding centre, and Vinh Binh seed plant.

Vietnam-France trade value on the rise

Vietnam’s exports to France in the first months this year increased by 55.4 percent to US$224.866 million euro compared to the same period last year.

Key export products grew strongly, especially electronic products up by 161 percent to more than US$64 million, ranking first among export items to France.

Nguyen Canh Cuong, Vietnamese Trade Counsellor to France said key traditional exports include footwear with nearly 50.2 million euro (up 10.9 million euro), garment with more than 28.53 million euro (up 3.4 million euro), household goods with more than 21.86 million euro (up 9 million euro) and seafood with 8.7 million euro (up 2.736 million euro).

Meanwhile, Vietnam’s imports from France reached 45.711 million euro, up 26 percent compared to the same period last year but down 18 percent compared to December 2011.

Many imported products achieved high growth, including engineering products with 3.522 million euro, machinery with 7.409 million euro and pharmaceuticals with 13.2 million euro while imports of drinks, chemicals and aviation equipment fell significantly.

Cuong said France’s exports to Vietnam will decrease in the first quarter of this year due to decline in Vietnam’s drink imports.

France attaches much importance to cooperating with emerging economies, like Vietnam, in the fields of aviation and space, railway, energy, pharmacy, technology, processing food and luxury fashion.

Vietnam – second most attractive investment destination in ASEAN

Investors in Southeast Asia rank Vietnam second in terms of most attractive investment destination, according to ASEAN Business Advisory Council (ABAC)’s survey.

The survey was conducted among 405 businesspeople in the region. Half of them chose Indonesia while 46 percent chose Vietnam as their investment destination, followed by Singapore, Thailand and Malaysia. At the bottom of the list are the Philippines, Laos, Cambodia, Myanmar and Brunei.

This is the second survey conducted by ABAC since 2010. One-fourth of the respondents are operating in Indonesia while 47 percent are working in Singapore, Vietnam, Thailand and the Philippines.

ABAC survey shows that ASEAN is more attractive than China in terms of commodity market and production location.

Outstanding entrepreneurs honoured

Seventy eight entreupreneurs, three outstanding pupils and two athletes have been awarded campaign medals by the central province of Thua Thien-Hue in recognition of their contributions to preserving the nation’s cultural heritage.

The outstanding individuals were honoured at the launch ceremony of the first “Vietnamese Entrepreneurs and National Cultural Heritage” program in Thua Thien-Hue on April 7.

The program, part of the 2012 National Tourism Year, aims to promote trade in the central province and honour those who actively contribute to the preservation of national culture.

More projects licensed at 2012 Coconut Festival

Six investment projects capitalized at VND86 billion and US$45.6 million have been granted licenses by Ben Tre provincial People’s Committee during the 2012 Coconut Festival being held from April 5-10.

Four out of the six projects are foreign-invested, including a US$39.6 million project of the Japanese subsidiary Nidec Tosok Precision Vietnam producing automobile gear boxes.

A memorandum of understanding on investment cooperation for five projects capitalized at VND1,284 billion and US$2 million was signed at the event, including the VND1,000 billion project by the Viet Tien Garment Corporation to build a garment and textile complex in Tan Thanh Binh commune, Mo Cay Bac district.

Local authorities has also called on foreign investors to invest in upgrading the infrastructure at Giao Hoa and Phuoc Long industrial parks.

Local business attends fair in Sri Lanka

The Vietnamese embassy and businesses are attending the 16th Consumer Fair in Colombo, Sri Lanka from April 2-11.

Viglacera Construction Company, T& T motorbikes, PP Paper and Halo Handicrafts all have products on display at the expo.

Vietnamese stands feature its culture and tourism as well as publications on the relationship between Vietnam and Sri Lanka.

This is the first time major Vietnamese businesses have taken part in the fair since Vietnam opened its embassy in Sri Lanka one year ago.

Vietnamese ambassador to Sri Lanka, Ton Sinh Thanh, said he hopes that more Vietnamese businesses will exploit the potential trade, investment and tourism markets and contribute to boosting economic ties between the two countries.

The Vietnamese embassy also held a meeting with businesses from the two countries on April 6 to help them seek partners and expand their markets.

Japan enters energy saving market in Vietnam

The Japanese enterprises, Hibiya Engineering and Veglia Laboratories, will join the energy saving market in Vietnam.

Hibiya Engineering is Japan’s leading air conditioner company and Veglia Laboratories specializes in providing energy saving and environmental protection services.

As planned, the companies will form a joint venture with the Viet Energy Service and Consulting Joint Stock Company (Viet Esco) to provide a Building Energy Management System (BEMS) for the Hibiya Engineering high-rise building and energy saving solutions from Veglia Laboratories to help reduce energy consumption in Vietnam.

Power shortages and greenhouse gas emissions are serious issues in developing countries such as Vietnam. This joint venture hopes to help Vietnam implement energy saving solutions by utilizing Japanese technologies.

Japanese businesses will follow this model in the future to strengthen relations with developing countries and enable them to reduce green house gas emissions. Japan also plans to tap into the power saving market in other Southeast Asian countries in the coming years.

Vietnam is considered a good partner for Japanese companies because of its abundant, cheap labour force and large consumer base that has developed from the country's high economic growth.

Experts urge support for farmers

Domestic and international experts have called for Vietnam to clarify policies that support farmers and agriculture enterprises instead of putting too much emphasis on growth targets.

Speaking at an April 6 consultation meeting in Hanoi, Minister of Agricultural Development and Rural Planning Cao Duc Phat said that despite years of rapid growth, the rate of agricultural GDP decreased from 4 percent annually in the period 1995-2000 to 3.83 percent in 2001-05 and 3.3 percent in 2006-10.

"The sector is quite vulnerable to diseases such as bird flu and natural disasters," he said.

In the proposal on restructuring the sector to become more sustainable and market-oriented by 2020, the Ministry of Agriculture and Rural Development (MARD) pointed out that agricultural production has been heavily reliant on crop production, a low investment rate that only amounted to 6.26 per cent GDP in 2010, overexploitation of natural resources that go along with intensive farming and widening use of agro-chemicals, fertilisers, pesticides and growth stimulants.

It suggested the livestock, fishery, forestry and salt production sectors move to large-scale production, encourage private investment and public-private-partnerships, apply science and technology policies and provide preferable credit and loan policies.

Steve Jaffee, World Bank Rural Development sector co-ordinator, said government planners should only set strategic targets related to competitiveness, sustainability and innovation, not production goals.

"If you're moving toward a market-led approach, the market will decide whether it's 46 or 50 million tonnes. Both domestic and international consumers will make the decision," he said.

However, World Bank Country Director Victoria Kwawa said there was not enough "focus on the policy elements," particularly the kind of policies to encourage farmers and other small holders to increase value-added production.

Some participants argued that focus remained on growth instead of shifting to address how the sector would adapt to climate change, address the issue of food safety and the type of policy environment that encourages investors.

Nguyen Tri Ngoc, head of the MARD's Department of Crop Production, agreed that the Government's resolution issued in 2010 to encourage investment in agriculture basically did not yield any result after more than a year.

Vu Trong Binh, deputy head of the Institute of Policy and Strategy for Agriculture and Rural Development, said the proposal should move in the direction of restructuring based on regional production, increasing the quality of the supply chain and providing a fairer environment for public and private enterprises to access resources.

The proposal emphasised targets that go beyond the control of the MARD such as changes in world market prices, said Ari Kokko, professor at the Department of International Economics and Management of the Copenhagen Business School.

"I think it would be more appropriate if targets could be defined with reference to the variables that are actually controlled by the MARD," Kokko said. "This has to do with policies and inputs related to knowledge, infrastructure, credits, extension services, storage facilities, coordination of investments and so forth."

In his paper sent to the consultation meeting, professor David Dapice, chief economist for the Vietnam Program at the John F. Kennedy School of Government, wrote that with respect to environmental threats to the Mekong Delta, too little may have been written in the proposal.

"The combination of falling ground water levels due to over-pumping, disrupted hydrology due to upstream dams and rising sea levels could severely damage the entire ecosystem," he explained. "It would be better to work on salt tolerant crops and fish raising systems as well as recharge of groundwater and raised beds for higher value crops."

Referring to the strategy as "top down, not bottom-up", Dapice stressed that the government should realise "the success of the targets depends on those who seem to be ignored."

HSBC Vietnam wins Card and Payment Award

HSBC Vietnam announced on April 6 that the bank has been named as the Best Bank for the Card and Payment Award by Visa.

This is the second consecutive year HSBC Vietnam has won the prize which aims to highlight the top banking partners’ contribution to developing the credit card market in Vietnam through innovative products which reflect customer demand.

HSBC is one of the world’s biggest financial and banking service providers. With a vast network of branches, HSBC’s credit cards are accepted at 19,000 payment locations in 160 nations and territories in the world, including nearly 1,000 payment locations in Vietnam.

Launched in Vietnam in 2008, HSBC’s credit cards have become more popular with an impressive growth rate of more than 100 percent over the past three years.

HSBC Country Manager of Vietnam, Cambodia and Laos, Lorijon Bacchi, said that award has acknowledged the bank’s remarkable achievements and proved that it is the leading bank in developing e-payment in Vietnam and expanding cooperative relations with Visa.

Overall solutions to develop coconut industry

A seminar was held on April 6 by the Ben Tre provincial People’s Committee to discuss solutions to increase the value chain of coconut trees and develop the coconut industry sustainably.

According to the Ben Tre provincial Department of Science and Technology, Vietnam has around 144,000 hectares of coconut trees, of which 53,000 hectares are in the southern province of Ben Tre, providing 80 percent of coconut output for the processing industry.

Ben Tre takes the lead among localities throughout the country in coconut productivity and quality. Since 2001, the dried grated coconut rice sector has driven coconut prices up, bringing stable incomes to farmers.

At the time of price hikes in 2011, one coconut was sold at VND12,000. The dried grated coconut rice has now become Ben Tre’s key export item.

Participants at the seminar said that the value chain of Ben Tre coconut is still weak due to lax production and processing procedures, limited investment and low productivity.

The coconut processing industry remains outdated and fails to expand its market, while the current market is not stable and coconut prices still depend on foreign markets where foreign traders are capable of greatly affecting the prices.

Increasing the value chain of coconut trees involves promoting links between farmers, traders and processing businesses.

Chairman of the Ben Tre Coconut Association Ho Vinh Sang said approximately 70 percent of households in the province grow coconuts and around 50,000 households earn their primarily income from the tree. Ben Tre has more than 50,000 workers in the industry, employed by 70 businesses and 1,400 production units.

In the last year, coconut products accounted for 40 percent of Ben Tre’s total export earnings. Consequently, increasing the coconut value chain will benefit all parties concerned and harmonize their interests.

A number of solutions were devised to ensure the balanced development of cultivation and processing based on a master plan to develop the coconut industry until 2020 with a vision for 2030.

Participants at the seminar also underlined the need to build a material area following the connectivity model to promote linkage between businesses and coconut farmers.

Developing trademarks and key products, and upgrading cultivation and processing technologies are among the prioritized solutions, they said.

Russian Gazprom teams up with Petro Vietnam in oil and gas exploitation

The Russian energy giant Gazprom has signed an agreement with the Vietnam National Oil and Gas Group (Petro Vietnam) to exploit oil and gas in the East Sea.

The signing ceremony took place in Hanoi on April 5 as part of Gazprom Director General Alexey Miller’s visit to Vietnam.

Under the agreement, the Russian RIA Novosti reported that Gazprom will hold 49 percent of the project’s shares, while Petro Vietnam will keep the remainder.

The project will exploit gas from two blocks, 05.2 and 05.3 on the East Sea.

Vietnam located two gas mines: Moc Tinh and Hai Thach in block 05.2 and 05.3 and one oil mine in block 05.2 with total reserves of 55.6 billion cub.m and 25.1 million tonnes of gas.

Gazprom and Petro Vietnam plan to drill 16 wells at depths of 2,000-4,600 m to exploit gas in these plots.

Gazprom and Petro Vietnam signed a strategic partnership agreement on December 15, 2009, under which the two sides agreed to develop wells in Vietnam’s continental shelf.

Earlier in October 2008, they signed an agreement to exploit oil and gas from wells No 129, 130, 131, and 132 for 30 years.

Vietnamese and Cambodian provinces seek cooperation opportunities

Cambodia’s Battambang province is seeking opportunities for production development and cooperation in rice agriculture and aquaculture.

The Governor of Battambang province Prach Chan said this at a meeting with Secretary of the An Giang provincial Party Committee Phan Van Sau on April 6.

Sau expressed his pleasure at the bilateral relations between An Giang and some Cambodian localities, which have grown steadily in recent times.

He said An Giang will create the best possible conditions for the two provinces to improve practical and effective cooperation in areas of their strength.

The two sides have worked out specific measures to boost multifaceted cooperation between An Giang and Battambang in the spirit of strategic partnership and friendly cooperation. They agreed to place priority on bilateral cooperation in economics, trade, investment and the transfer of technology for agriculture and aquaculture.

HCM City-Incheon air route opens

The Republic of Korean Airway, Jeju Air has officially launched the Ho Chi Minh City-Incheon air route with a single ticket fixed at US$290.

In 2011, the Civil Aviation Administration of Vietnam, the Ministry of Transport and the Korean Air signed an agreement, allowing Korean low-cost Jeju, Air Busan, Jin Air, Eastar Jet and T’way Airlines to conduct flights to Vietnam.