Download - 241017Intellasia Finance Vietnam - hkbav.org · After investing in Tasco and FPT Retail, VinaCapital pours USD 11m into OCB 8 Sun Life Vietnam opens 5 more business offices 9

24 October 2017

finance & business news

FINANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Reference exchange rate goes up by 4 VND 1VN's central bank to keep currency stable: Official 1Lending grows 12.16pct in nine months 2New order set in banks' profitability 2017 2Multiple flaws found in bank acquisitions and infrastructure

projects 3Nearly 87pct of ATM cards are used to withdraw money: VBCA 4Vietcombank posts 31pct profit rise 5TPBank reports 9-month profit at 711b dong 7Short of medium and long-term capital, VietinBank offers

bonds worth 4.2 trillion dong 7Saigonbank attains 230b dong pre-tax profit in Jan-Sep 8After investing in Tasco and FPT Retail, VinaCapital pours

USD 11m into OCB 8Sun Life Vietnam opens 5 more business offices 9Vietnam forecasts GDP growth of at least 6.5 pct in 2018,

says 2017 target in sight 9PM: All socioeconomic targets within reach 10Cabinet sets 6.5-6.7pct GDP growth rate for 2018 102018 economic targets undergo NA inspection 11GDP growth must rely on internal strength: economists 12For the UNDP, Vietnam a model of growth 13Divestment and equitisation hardly reach target 15National Assembly gathers to weigh focal laws 16Vietnam reports over $1 billion in trade surplus 17Big EU demand for small shrimps 18Vietnam seeks to export pork 18Vietnam doubles efforts to improve business environment 19Tourism makes up low proportion of GDP 19PM calls for better cooperation among Apec members 20Storm brewing over special tax regime proposal 21Shifting burden 22Electronic tax collection, customs clearance piloted 24HCM City sees science and tech as driving forces for growth 24Vietnam needs logistics development strategy 25More efforts need to be made to lure foreign funds for start-ups 25

VN textile industry needs to spin a new yarn 26Vietnam is gold mine for international express delivery firms 27Rural market becoming more attractive to manufacturers 28HCM City: Private sector needs most labourers 29Tien Giang works to support enterprises 29

BIZ NEWS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30Business Briefs 24 October, 2017 30Shares slide on profit-taking selling 30Market corrects downwards as blue chips lose steam 31SOE divestment seen obstructing cash flow into equities 31VFM funds report solid results 32TAC to reach 2017 target for pre-tax profits 33Tien Phong Plastic plans to lift foreign ownership cap 33HCM City says will trace pork origin more stringently 34Nam Dinh, Thai Binh develop disease-free pig production

for export 34Concern over quality threatens export of Vietnamese pork 34VIETRADE supporting brands in entering Korea 35Association enhances Vietnam-Japan economic links 36LCD tax loophole found, with big losses 37ITST proposes monorail lines to airport in HCM City 37HCM City to set up $189 million science, technology park 38Global IT firms should found VN legal entities: VTC 38Nearly VND5bn of smuggled goods destroyed in Lang Son 39PV Oil ready to roll out E5 bio-fuel nationwide 39Operator to sell 5-6pct of Vietnam's sole refinery 40Vietnam's airport ground services firm honoured by Korean Air 41Inspection finds grave mismanagement at ACV 41HAAN begins work on new wood processing factory 42Ground broken for 16 million USD candy factory in Nghe An 42Float glass plant opens in Ninh Binh 43CapitaLand ranks 68th among top 100 in Forbes' Top

Regarded Companies 43Nghi Son economic zone to welcome ecological resort 43Fusion Maia Da Nang selected as top-20 hotel-spas in world 44

FINANCEReference exchange rate goes up by 4 VND

24/OCT/2017 INTELLASIA| VNA

The State Bank of Vietnam (SBV) set its reference VND/USD exchange rate at 22,469 VND/USD on October 24, up by 4 VND from the previous day.With the current +/- 3 percent VND/USD trading band, the ceiling exchange rate is 23,143 VND per USD and the floor rate is 21,795 VND per USD.Vietcombank listed its buying and selling rates at 22,685 VND and 22,755 VND, per USD, both up 5 VND from October 23.Meanwhile BIDV raised its rates by 10 VND to 22,690 VND (buying) and 22,760 VND (selling), per USD.https://en.vietnamplus.vn/reference-exchange-rate-goes-up-by-4-vnd/119959.vnp

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Vietnam finance & business 24 October 2017

VN's central bank to keep currency stable: Official

24/OCT/2017 INTELLASIA| VNS

Record-high foreign reserves will enable Vietnam's central bank to keep the dong, the local currency, stable for the rest of the year, Bloomberg quoted a central bank official as saying.With reserve levels at $45 billion, "we are confident we will be able to maintain the dong's value," in 2017, Nguyen Thi Hong, deputy governor of State Bank of Vietnam (SBV), said on the sidelines of a meeting in Hoi An last Saturday. "Such a high level of foreign reserves will allow us to step in to stabilise the money market when needed," she added.According to Bloomberg, the dong has been one of the most stable currencies in Asia this year.An increase in remittances from Vietnamese living abroad has helped boost foreign re-serves this year, which allows the central bank to continue focusing on policies to sup-port economic growth, Nguyen Hoang Minh, deputy head of SBV in HCM City, said in an interview last month.The central bank will ensure lenders have enough liquidity "so that they can lend at lower interest rates," Hong said. "By helping banks with more cash availability, we will be able to bring down lending interest rates at banks without having to cut our policy rates," she added.Vietnam was one of only a handful of Asian nations, whose central bank eased mone-tary policy this year, unexpectedly cutting benchmark interest rate for the first time in three years in July.Prime minister Nguyen Xuan Phuc said on Monday morning that Vietnam is expected to meet the GDP growth target of 6.7 per cent this year. If it can reach the target, it will be the fastest pace since 2007. The economy grew 6.41 per cent in the nine months through September.http://bizhub.vn/banking/vns-central-bank-to-keep-currency-stable-official_289661.html

Lending grows 12.16pct in nine months


Credit growth of the entire banking system in the last 10 days of September rose 1.14 per cent, pushing the total increase in the first nine months of this year to 12.16 per cent, the latest report from the State Bank of Vietnam (SBV) showed.Loans to the agricultural and rural areas increased by 17.6 per cent year-on-year, the industrial sector was up 17.75 per cent, construction was up 19 per cent, and trade and services was up 18.1 per cent.Outstanding loans to small- and medium-sized enterprises by the end of August ac-counted for 21 per cent of the total outstanding loans, up 7.5 per cent compared with the period till December 31 last year.The high credit growth has helped boost GDP in the first nine months to 6.41 per cent, much higher than the 5.99 per cent increase in the first nine months of 2016.SBV also reported that in the first nine months of 2017, over 300 meetings and dia-logues between banks and enterprises were organised to assist enterprises in getting access to bank loans. Accordingly, banks committed to lend to firms nearly VND570 trillion (US$25.11 billion), of which more than VND550 trillion was disbursed for cor-porate customers.In addition, banks also provided other forms of support, such as reducing lending rates for firms' old loans totalling nearly VND20 trillion.To support the economic growth, the government has also requested SBV to continue the monetary policy in the direction of lowering lending rates, at the same time raising outstanding credit to 21-22 per cent in 2017, based on credit quality and macro stabili-ty.Together with the extension approval, SBV also instructed commercial banks to con-duct scrutiny to ensure bank capital went to effective sectors, avoiding non-perform-ing loans.SBV noted that it is ready to supply capital to the economy; however, the terms of lend-ing will remain strict, in accordance with legal regulations and procedures.

New order set in banks' profitability 2017

24/OCT/2017 INTELLASIA| VNECONOMY

Last week, many commercial banks have announced basic business results in the first nine months of 2017, initially setting new records and new orders in the system.With many announced results, so far, the year 2017 can be seen as the best year for the

Intellasia 24 October 2017 2 / 44

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banking system's profitability since 2012.In the previous year, the Foreign Trade of Vietnam (Vietcombank) and Vietnam Bank for Industry and Trade (Vietinbank) led the system in terms of absolute figure.This year, Vietinbank has not announced specifically updated figures so far while Vi-etcombank is expected to take the first position in profits with significant gap com-pared to the second position.In 2016, Vietcombank attained record profits, so the growth rate so far has become even and has no longer been as unexpected as some banks that grow from low to high.Specifically, in the first nine months of 2017, the pre-tax profit before putting for risk provision of Vietcombank reached 12.186 trillion dong, up 14.1 percent year-on-year. The after-tax profit after putting for risk provision touched 7.687 trillion dong, up 24.4 percent year-on-year, completing 80.9 percent of the 2017 plan.By acquiring the entire bad debt sold to the Vietnam Asset Management Company (VAMC) in 2016 along with the risk provision fund of 10.390 trillion dong, equal to 136.4 percent of the total outstanding bad debt, as well as the recent estimate of some Vietcombank leaders, the bank's pre-tax profit this year at 10 trillion dong is within reach. This is also the new record of Vietnamese commercial banks.Meanwhile, in the group of joint stock commercial banks, Vietnam Prosperity Bank (VPBank) has been showing a breakthrough in three recent years, which has not had a counterweight partner in the same group.In the first nine months of this year, VPBank's consolidated pre-tax profits reached 5.635 trillion dong, up 79 percent year-on-year and fulfilling 78 percent of the full-year target.With this rate, it is expected that VPBank will be the first private joint stock bank to have the absolute figure of profits equal to some state-owned banks (despite equitisa-tion, the State still holds dominant ownership rate). Accordingly, the bank is expected to continue being the member having the highest profitability compared to all remain-ing banks.With lower capital scale and total assets, the "new order" of banks' profitability index in 2017 has started to show unexpected growth at Hochiminh City Development Com-mercial Joint Stock Bank (HDBank).Specifically, after nine months, HDBank's profits had unexpected growth with 279%, exceeding the full-year target; the consolidated pre-tax profit in January-September touched 1.912 trillion dong, of which HDBank's separate profit was 1.713 trillion dong. Even, HDBank also expects that the full-year consolidated profits will reach about 2.4 trillion dong.With the aforementioned results, it is likely that at the end of this year, Vietnam stock market will have a new appeal from the banking sector after VPBank and LienViet-PostBank have gradually offered stocks for sale to the market.Also at LienVietPostBank, the full-year profit target has almost been achieved after nine months, with about 1.450 trillion dong. The year 2017 is also expected to be the year that the bank's profit will make a strong breakthrough after nine years appearing in the market, especially after two consecutive years of investing in the plan to open a series of new branches to cover the entire country and invest in technology.Currently, Saigon-Hanoi Bank (SHB) has not announced yet but it is expected that this is also the member that has strong breakthrough in profits in this year, with the possi-bility of completing the full-year target two months ahead of schedule, as per the study of Vneconomy.However, it is still not known when SHB will officially launch consumer finance com-pany though Q3 has passed compared to the plan set at this year' annual shareholders' meeting.Besides updated figures, plans and implementation progress, the common point in the profit picture of commercial banks in 2017 is that many members are improving clearly profitability indicators in the context that the Net Interest Margin in general does not change a lot (only ranging at 2.7-2.8 percent in recent years). This partly reflects better asset quality in 2017.


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Multiple flaws found in bank acquisitions and infrastructure projects

24/OCT/2017 INTELLASIA| THE SAIGON TIMES

The State Audit Office of Vietnam (SAV) has detected a slew of flaws in the process of the central bank's acquiring debt-laden commercial banks at zero dong and the Minis-try of Transport's implementing public-private partnership (PPP) infrastructure projects.SAV has sent a report on the implementation of Resolution 63/2013/QH13 of the Na-tional Assembly on enhancing crime control in 2017 to the National Assembly Stand-ing Committee and deputies before the country's legislature starts a month-long session today. Three banks bought by the State Bank of Vietnam at zero dong are Vi-etnam Construction Bank, Ocean Commercial Bank (Ocean Bank) and Global Petrole-um Bank (GP Bank). After two years of their acquisitions, these banks have continued incurring huge losses.As for the traffic infrastructure projects implemented in the PPP format, SAV proposed cutting toll collection time by 62 years and eight months, equivalent to more than VND22.2 trillion (US$0.98 billion).Six out of 52 toll stations were found to collect fees before the roads were completed by 14 years and six months. There were 31 out of 87 toll stations misplaced as they are not 70 kilometers apart between the two nearest stations.In a related development, SAV proposed increasing collections by trillions of dong from enterprises regarding equitisation and land use.After four enterprises were inspected, SAV suggested collecting an additional VND491.5 billion increasing State holdings at enterprises by VND6.4 trillion and revis-ing up corporate value by VND7.2 trillion.In particular, the value of Power Generation Corporation 3 was adjusted up by an ex-tra VND1.5 trillion, Binh Son Refining and Petrochemical Co Ltd by an additional VND4.6 trillion, Thanh Le general ImportExport Trading Corporation by a further VND72.8 billion, and Binh Duong Production Import-Export Corporation by VND211 billion more.SAV also proposed imposing fines of a combined VND4.3 trillion on violations in land management and use in urban development projects in Hanoi, Binh Duong, Dong Nai and Lao Cai. The auditing agency also pointed out some shortcomings including arbi-trary approval and change of land use planning, inappropriate land use, lower-than-allowed land rent, and project transfers not in line with the 2013 Land Law.Reviews of 108 audit reports in the year to late last month had found misstated financ-es amounting to nearly VND23 trillion. Therefore, State budget revenue increased by VND11 trillion, and expenditures fell by VND6.8 trillion.In addition, SAV proposed amending, supplementing, withdrawing and replacing 40 legal documents including two decrees, five circulars, 13 decisions and 20 other docu-ments to prevent losses and wastefulness.

Nearly 87pct of ATM cards are used to withdraw money: VBCA

24/OCT/2017 INTELLASIA| LAO DONG

As per the data of the Payment Department under the State Bank of Vietnam (SBV), as of the end of Q2/2017, about 121 million bank cards were issued. With the population of about 95 million people, on average, each person owns 1.3 cards."I think it is wasteful! Currently, banks are racing to open cards, the focus is on quan-tity but not quality", said Dr Bui Quang Tin Department of Business Administration Hochiminh City Banking University.Quynh (Cau Giay, Hanoi) hooked in her wallet five credit cards of five different banks. In spite of owning many bank cards, she mainly uses one debit card and one visa card with overdraft feature when shopping. The reason for keeping all the five cards in the wallet, according to Quynh, is to experience the service of banks and take advantage of discounts and promotions of each different type of cards when shopping. Thien (Ba Dinh, Hanoi) complained that although he has as many as three credit cards, apart from the monthly payment of electricity and internet, he just waited until having salary to withdraw the money. Thien said the current usage of cards is not convenient because small shops usually do not have POS. Once he wanted to drink beer but the


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shop did not have card scanning machine so Thien had to go a long way to find an ATM to withdraw cash to pay.One of the reasons for the massive opening of credit cards is because bankers race to meet KPI target so they try to persuade customers to open cards. A finance and bank-ing expert told Lao Dong newspaper that "I have five credit cards but I only use 1-2 of them. The reason is because my students ask me to open the card to help them meet the target"."The pressure to accomplish the card issuance target is so heavy that I have to mobilise all my relatives to open cards. After receiving the hard card, I immediately cut the cor-ners to cancel because my relatives have no demand for using cards".A finance and banking expert said "The massive opening of bank cards but not using them is a waste of resources and money. It is impressive if you just hear about the new-ly opened cards, but how many of them are used frequently is worth mentioning".There is a paradox that many credit cards have been opened but in fact the non-cash payment is still modest compared to the potential of Vietnam market. As per Vietnam Bank Card Association, nearly 87 percent of transactions via ATMs are cash withdraw-al transactions. The fact that the annual cash withdrawal via ATMs still increases over the years (from 60 billion dong in 2012 to 106 billion dong in 2016) shows that the peo-ple's habit of using cash is still very popular. As reported by the State Bank, as of July 2017, the ratio of cash payment to total means of payment was 11.35%. The govern-ment expects that the figure will be less than 10 percent by 2020.Answering the press, Dr Le Xuan Nghia said Vietnam is the country with the lowest amount of non-cash payment in Southeast Asia. Why do Vietnamese people prefer us-ing cash to card payment? As per a specialist, the culture of using cash of the people is so deep, so it takes time to gradually change the culture of using cash. For some cor-rupt officials, taking bribes in cash will be safer than receiving bank transfers. For some subjects such as implicit trade, black society, drugs, prostitution, etc., using cash will make it easier for the money laundering and tax evasion.Dr Bui Quang Tin added there reasons why the people still hesitate using credit cards. First, currently the usage of cards to make payment for transactions is charged. Al-though the card scanning fee must be paid by agents, in fact, customers are forced to pay an additional of 1.5-3 percent if they want to make payment by credit cards. To avoid being inspected, retailers push the card scanning fee to the selling price so it is very difficult for banks to control.Second, the cash withdrawal via ATMs is not always convenient. Finding ATMs to withdraw cash in rural areas is rather difficult, and retail stores do not have POS. Meanwhile, in large cities, that ATMs report errors or run out of money is quite pop-ular. This creates the impression that customers cannot use cards despite having mon-ey.Third, after a series of money losses in account, many customers are worried out the safety and confidentiality. Currently, many banks have quite out-dated and rudimen-tary technology. Although banks have warned customers not to visit fake websites to avoid hackers attacking their accounts, many customers have visited strange sites and had their credit card information stolen by bad guys.The promotion of non-cash payment is the right guideline of the government. From 2016 to 2020, the government targets that 100 percent of supermarkets, shopping cen-tres and modern distribution units have card-accepting equipment and allow consum-ers to make non-cash payment. 70 percent of suppliers of electricity, water telecommunication, and media services accept bill payments of individuals and households through the non-cash payment. 50 percent of individuals and households in large cities use non-cash payment means in consumption and procurement.To change the people's habit of using cash, according to experts, there needs to encour-age the stronger development of e-wallet products, using QR code in payment, and payment procedures needs much improvement in policy. Banks should shake hands with Fintech companies to complete products and accelerate non-cash payment.


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Vietcombank posts 31pct profit rise


The Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) has re-ported VND2.68 trillion (US$119 million) as its pre-tax profit for the third quarter, marking a yearly increase of 31 per cent.That helped the largest market-capitalisation bank record a total pre-tax profit of VND7.9 trillion in the nine-month period, an increase of 25 per cent from the previous year's figure. The bank has now met 86 per cent of the target it set for 2017.The strong increase in Vietcombank's pre-tax profit was attributed to the healthy growth rates of financial services (24 per cent), core business activities (9 per cent) and other activities (29 per cent).The bank was able to keep its provision for credit losses stable at VND4.5 trillion, near-ly unchanged compared to the same period of last year.After the first three quarters, Vietcombank had total assets of VND898.5 trillion, mobi-lised capital of VND688 trillion and a lending amount of VND536 trillion.These figures increased by between 14 per cent and 16 per cent on an annual basis.The ratio of bad debts during the nine-month period was 1.15 per cent, down from 1.51 per cent made at the end of last year, thanks to the decline of loans that are classified as sub-standard debts and potentially-irrecoverable debts.Credit institution's loans are divided into five categories of debt in accordance with regulations issued by the State Bank of Vietnam in 2013.In addition to the two types mentioned above, the other three are standard debts, at-tention-needed debts and doubtful debts.Shares of Vietcombank, listed on the HCM Stock Exchange under code VCB, fell 2.2 per cent to close Monday at VND39,900 per share. The bank's share price has gained a total of 8.7 per cent in the last month.Reduced cross-ownership in financial unitsVietcombank plans to sell its entire stakes in the HCM City-based Saigon Bank for In-dustry and Trade (Saigonbank) and Vietnam Cement Finance Company (CFC) on No-vember 20.The bank obtained approval of the State Securities Commission for its share sales in the two financial units on Friday. The divestment plan was approved by the bank's management board in late August.Vietcombank will auction entire 13.2 million shares or 4.3 per cent of total capital in Saigonbank at the starting price of 12,550 per share.It also plans to sell all of its 6.6 million shares, equal to 10.91 per cent stake in CFC, at the starting price of VND11,549 per share.The deals are expected to generate roughly VND242 billion for Vietcombank and help it comply with the SBV's circular 36 on regulations for the operation of finance-credit institutions in Vietnam.According to the combined nine-month financial report of Saigonbank, the southern financial institution posted a pre-tax profit of VND231 billion, a yearly increase of 25 per cent and equal to 85 per cent of its 2017 targeted number.However, Saigonbank had a higher non-performing loan ratio, which increased to 2.75 per cent from 2.63 per cent at the end of 2016, nearly hitting the limit of 3 per cent set by the SBV.For 2017, Saigonbank plans to record VND270 billion in pre-tax profit an annual rise of 55 per cent and a 5 per cent dividend payout rate for shareholders.CFC has not released its nine-month financial report. According to the company's au-dited six-month financial report, CFC posted VND5 billion in pre-tax profit down 50 per cent from last year's number.Besides CFC and Saigonbank, Vietcombank also wants to offload its entire 5.07 per cent ownership in Orient Commercial Bank (OCB).Vietcombank is also holding stakes in two other financial units, which are Vietnam Ex-port and Import Joint Stock Commercial Bank (Eximbank) (8.19 per cent) and Military Commercial Joint Stock Bank (MBBank) (7.16 per cent).At its annual general shareholder meeting held in April 2017, Vietcombank's manage-


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ment board proposed shareholders approve its plan to divest from Eximbank with the hope of receiving VND700 billion.The management board also proposed to keep its ownership in MBBank unchanged as the military-owned bank has been operating efficiently and making instant yearly dividend payouts.http://bizhub.vn/banking/vietcombank-posts-31-profit-rise_289665.html

TPBank reports 9-month profit at 711b dong

24/OCT/2017 INTELLASIA| TRI THUC TRE

Tien Phong Commercial Joint Stock Bank (TPBank) has announced its financial state-ment in Q3/2017.Accordingly, as of the end of Q3/2017, the bank's total assets hit 114 trillion dong, up 8.5 percent from the beginning of the year.Loans to customers reached 56.7 trillion dong, up 21.6%. Customers' deposits touched nearly 59 trillion dong, up seven percent.In Q3, the bank's net interest income hit 900 billion dong, up 63 percent year-on-year. Some other business activities attained positive results. Ending Q3, TPBank earned 323 billion dong pre-tax profits, doubling the same period.Cumulatively, in January-September, the bank recorded 806 billion dong pre-tax prof-its, 2.2 times higher than the same period last year, exceeding the profit plan of 780 bil-lion dong set for the whole year 2017. The after-tax profit remained at 711 billion dong.The non-performing loan (NPL) ratio was 0.9%. TPBank said the bank settled the bonds of Vietnam Ship Building Industry Corporation following the government's guiding documents and directions. Part of the bonds were swapped for bonds of the Debt and Asset Trading Company (DATC) with 10-year term and fixed interest rate of 8.9%/annum. The other part is put for risk provision within five years and uses provi-sioning fund to handle annual credit risks.In terms of personnel, in October 2017, TPBank announced the decision to reappoint Nguyen Hung CEO of TPBank in five years of restructuring to the position of TPBank CEO for the next five-year term.

Short of medium and long-term capital, VietinBank offers bonds worth 4.2 trillion dong

24/OCT/2017 INTELLASIA| BIZLIVE

The Commercial Joint Stock Bank for Industry and Trade of Vietnam (VietinBank code CTG) has been approved by the State Securities Commission (SSC) to sell 420,000 bonds to the public. Accordingly, VietinBank will offer bonds in two phases. In the first phase, 200,000 bonds will be issued in October and November 2017 and in the sec-ond phase, 220,000 bonds will be issued in November 2017. The tenor of the bonds is 10 years, and selling price is equal to par value of 10 million dong per bond. The total offer value under par value is 4.2 trillion dong.This is a non-convertible corporate bond and is not secured by assets. The bond yield is paid annually, which equals to the reference interest rate plus 1.2 percent per an-num. In which, reference interest rate is the average level of 12-month deposit rates of four commercial banks including VietinBank, BIDV, Vietcombank, and Agribank.In the first phase, 200,000 offered bonds will be distributed within 90 days since the bank's registration for bond sale takes effect. If the buying volume is not as expect, the remaining will be left to the second phase.In the second phase, 220,000 bonds will be distributed within 90 days since the SSC is-sues official document upon receipt of VietinBank's Notice of bond issuance of the sec-ond phase.In the first phase, the amount of capital expected to be mobilised is two trillion dong, which will be used to supplement VietinBank's working capital and enhance its finan-cial capacity. The minimum registered amount is 10 bonds. The time to register the buying will be from October 25th to November 13rd. 2017.VietinBank's Board of directors clearly stated that the capital grossed from the bond issuance will be used for medium and long-term lending in dong in 2017. Accordingly, the two trillion dong of the successful bond issuance in the first phase will be distrib-uted to lending to the fields of electricity (500 billion dong) and production and busi-


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ness (1.5 trillion dong), specifically 773 billion dong for loans in steel area, 210 billion dong for loans in coffee area, 171 billion dong for loans in construction materials area, and 100 billion dong for loans in food area, etc.The 2.2 trillion dong successfully issued in the second phase will be for lending to transportation sector (1.047 trillion dong), steel loans (572 billion dong), water loans (370 billion dong), and cement loans (100 billion dong), etc. At the same time, the cap-ital from the secondary bond issuance will also be used to replace the short-term funds that have been financed for projects in the fields approved by the State Bank of Viet-nam at the 2017 bond issuance plan of VietinBank.

Saigonbank attains 230b dong pre-tax profit in Jan-Sep


Under the consolidated financial statement in Q3/2017 of Saigon Commercial Joint Stock Bank (SaigonBank), as of the end of September 30, 2017, the bank's total assets reached 20.2 trillion dong, up 6.3 percent from the beginning of the year.Loans to customers touched nearly 13.4 trillion dong, up 7.2%. Customers' deposit hit 14.4 trillion dong, up two percent.In the first nine months of this year, Saigonbank's net interest income reached 506 bil-lion dong, up 8.3 percent year-on-year. Other business operations had better results than the same period last year.Operating cost swelled 6.4%, and the risk provisioning cost decreased 14%.In Q3/2017 alone, Saigonbank achieved the pre-tax profit of about 71 billion dong.Cumulatively, in January-September 2017, Saigonbank attained 230 billion dong pre-tax profit, up 25%. The after-tax profit was 183 billion dong, up 24 percent year-on-year.The bank's total bad debt as of the end of September 2017 was 368 billion dong, ac-counting for 2.74 percent of the total outstanding loans.In the last nine months, the average income of each staff was nine million dong per month, equal to 2016. The total number of employees was 1,483 people, down 10 em-ployees.

After investing in Tasco and FPT Retail, VinaCapital pours USD 11m into OCB


The Vietnam Opportunity Fund (VOF) of VinaCapital has invested about 11 million USD into Orient Commercial Joint Stock Bank (OCB) to own nearly 5 percent stake of the bank. VOF said that this investment will help OCB diversify its services to targeted customer segments, including wealthy individual clients and small and medium en-terprises. Previously, in August, VOF made two investments worth 11 million USD each into Tasco Joint Stock Company (stock code: HUT) and FPT Digital Retail Joint Stock Company (FPT Retail).Explaining the investment in OCB, Andy Ho, CEO of VOF cum Investment director of VinaCapital shared that the bank has high credit growth rate and profit number, and a strong management team. "In addition to negotiating at an attractive price, we have achieved a number of commitments to protect minority roles and commitments on op-erational efficiency, which make this transaction much more attractive", said Andy Ho.VOF did not provide details about the purchase price of shares or the total number of shares purchased. On the Over-the-counter (OTC) market, there recently has no infor-mation on OCB shares' selling offers but mainly buying deals with prices around 11,500-13,500 dong per share. OCB expects to list its shares on the Hochiminh Stock Ex-change (HOSE) before the end of 2019.Established in 1996, OCB currently ranks the 17th out of 34 domestic banks in terms of total assets. OCB recorded a Compound Annual Growth Rate (CAGR) of 23 percent in the past four years, and expects to reach a profit growth of about 100 percent and 30 percent in 2017 and 2018.In late June 2017, OCB was approved by SBV to raise charter capital from four trillion dong to 4.195 trillion dong by issuing bonus shares to existing shareholders from the undistributed profit in 2016. SBV has also approved OCB's plan to increase charter capital by 805 billion dong via private placement.


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According to data of StoxPlus, BNP Paribas (France) is currently holding 17.8 percent stake of OCB, while Ben Thanh Corporation owns 7.2%, Vietcombank owns 4.5 per-cent and the bank's Chair owns 3.6 percent of the bank's stake.VOF's investment in OCB is made in the context when VOF and some other funds have continuously withdrawn from real estate sector, especially from projects with slow progress. As of September 30th 2017, VOF has eight real estate investment in its port-folio, accounting for less than 5 percent of the Net Asset Value (NAV).As per VOF, in the 2016-2017 financial year, the fund made 220 million USD of new investments in private companies, listed companies, bargain trading and bonds, namely the investment in Vietjet Air (VJC), Coteccons (CTD), Tasco (HUT), Viglacera, banks, and FPT Retail.

Sun Life Vietnam opens 5 more business offices

24/OCT/2017 INTELLASIA| DTCK

Sun Life Vietnam has simultaneously launched five sales and customer service offices in Ba Ria-Vung Tau, Dong Nai, Ca Mau, Kien Giang and Dak Lak. These offices are built under new model with modern and state-of-the-art equipment and facilities.Sun Life's new business and customer service offices are not only the venue for trans-action but also for events, seminars, financial advisory services and after-sale services.Larry Madge, CEO of Sun Life Vietnam said in the near future, Sun Life Vietnam will continue investing in expanding new business and customer service offices in provinc-es and cities nationwide in order to enhance the best customers' experience while help-ing the people achieve lifetime financial security with a variety of protection and savings products.Since the beginning of this year, Sun Life Vietnam has put into operation two business and customer service centers in HCM City, Da Nang and 14 business and customer service offices in major provinces and cities nationwide.

Vietnam forecasts GDP growth of at least 6.5 pct in 2018, says 2017 target in sight

24/OCT/2017 INTELLASIA| VNEXPRESS

The government's latest forecast is more optimistic than the World Bank's projection.Vietnam expects economic growth of 6.5-6.7 percent next year, and thinks that the tar-get of 6.7 percent set for this year is within reach, prime minister Nguyen Xuan Phuc said on Monday.The country plans to keep inflation steady at 4 percent in 2018, the same expansion projected for 2017, Phuc told the legislative National Assembly at the start of its second session of the year.After growing 6.2 percent in 2016, Vietnam's economy has been expanding faster this year, with growth quickening to 6.41 percent in the first nine months, according to government data.The country has targeted export revenue growth of 7-8 percent and a trade deficit of below 3 percent next year.To meet the 2018 goals, Phuc said local authorities should cut interest rates, ensure credit is available for enterprises and strengthen the management of the gold and for-eign currency markets.They should also carry out tightened fiscal policies, intensify the fight against tax fraud, cut budget overspending and accelerate administrative reforms, he added.In addition to strengthening economic growth, the government should take measures to control inflation and improve the investment environment, chair of the National As-sembly's Economic Committee Vu Hong Thanh said at the session.The World Bank projects Vietnam's real GDP growth will accelerate slightly to 6.3 per-cent this year, boosted by buoyant domestic demand, rebounding agricultural produc-tion and strong export-oriented manufacturing.Over the medium term, growth is going to stabilise at around 6.4 percent in 2018-2019, the bank said in an October report, which also raised growth forecasts for China, Ma-laysia and Thailand.https://e.vnexpress.net/news/business/vietnam-forecasts-gdp-growth-of-at-least-6-5- percent-in-2018-says-2017-target-in-sight-3659768.html


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PM: All socioeconomic targets within reach

24/OCT/2017 INTELLASIA| VN ECONOMIC TIMES

PM tells NA that Vietnam is likely to fulfill all 13 socioeconomic targets set for 2017.Reporting to the 14th National Assembly's fourth session, on the current socioeconom-ic situation, which opened in Hanoi on October 23, prime minister Nguyen Xuan Phuc said that Vietnam is likely to fulfill all 13 socioeconomic targets set for 2017 based on economic performance in the first nine months of the year.He was quoted by the Vietnam News Agency as saying that of the targets, five are ex-pected to exceed plans, including the trade deficit, which is forecast to stand at only 1.5 per cent compared to the expected 3.5 per cent. Total development investment is likely to reach 33.42 per cent of GDP, against a target of 31.5 per cent.Export growth is set to hit 14.4 per cent, double the targeted 6-7 per cent. The total number of hospital beds around the country is to increase to 25.7 per 10,000 people against a goal of 25.5, while health insurance coverage is expected to reach 83 per cent while the target was 82.2 per cent.The prime minister reported that the CPI rose 3.79 per cent in the first nine months and will be around 4 per cent for the year as a whole, with basic inflation standing at about 1.6 per cent. GDP growth in the first nine months was 6.41 per cent, with the annual figure to come in at about 6.7 per cent. The poverty rate, as calculated by a multidimen-sional approach, fell 1-1.5 per cent to 6.7-7.2 per cent.These are great successes for the country, he said, especially in the context of it trans-forming its growth model towards reducing the exploitation of natural resources and strengthening the processing industry, high technology agriculture, and services and tourism.He also sketched out goals for 2018, including GDP growth of 6.5-6.7 per cent and a CPI of about 4 per cent.Total export revenue is to expand 7-8 per cent, while the trade deficit is to be below 3 per cent. Development investment from society is to stand at around 33-34 per cent of GDP.The prime minister also set targets of curbing the poverty rate by 1-1.3 per cent on av-erage and 4 per cent in poor areas, and keeping unemployment in urban areas at below 4 per cent.The percentage of trained workers is to reach 58-60 per cent of the workforce. Social insurance card holders are expected to hit 85.2 per cent of the population.The country will also strive to have 88 per cent of industrial parks and export process-ing zones having concentrated wastewater treatment systems, with forest coverage to be 41.6 per cent.In order to reach the targets, he also outlined five major solutions, including strength-ening macroeconomic stability, ensuring balance in the economy, and speeding up business and production as well as economic growth.He also pointed to the need to restructure the economy in a consistent, comprehensive, and practical manner, along with making active responses to climate change and nat-ural disasters, environmental protection, and natural resources management.He also highlighted the necessity of building an effective and disciplined administra-tive system and drastically fighting corruption.http://vneconomictimes.com/article/vietnam-today/pm-all-socioeconomic-targets-within-reach

Cabinet sets 6.5-6.7pct GDP growth rate for 2018

24/OCT/2017 INTELLASIA| DTI NEWS

PM Nguyen Xuan Phuc announced that the government targets to attain a 6.5-6.7 per-cent GDP growth pace in 2018 based on impressive achievements made in 2017.PM Phuc made the announcement while delivering a report on socio-economic devel-opment plan for 2018 at the ongoing 4th session of the 14th National Assembly on Oc-tober 23 in Hanoi.The PM said that in 2018, the government will spare no effort to maintain the growth pace of 2017; accelerate investment in key transport projectss; resolve shortcomings and infringements in BOT and BT projects.


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Maintaining growth pacePM Phuc noticed that in 2018, the global and regional situations were forecast to take place in a complicated and unexpected manner. The world economy grows unevenly in 2017; coupled with risks and rising protection trend. In addition, the fourth indus-trial revolution has been generating both opportunities and challenges for Vietnam.The government targets to strive for a 6.5-6.7 percent GDP growth rate in 2018; contin-ues to stabilise the macro-economy; restructure the economy; transform the growth modal; improve competitiveness; encourage business start-up; develop businesses; and promote growth.Key economic norms for 2018- GDP growth rate: 6.5-6.7%- Average CPI growth pace: about 4%- Total export turnover: up 7-8%- Ratio of total exports of goods to total imports of goods: under 3%- Total social development investment capital: about 33-34 percent of GDPhttp://dtinews.vn/en/news/017004/53434/cabinet-sets-6-5-6-7--gdp-growth-rate-for-2018.html

2018 economic targets undergo NA inspection

24/OCT/2017 INTELLASIA| VIR

The government has submitted a plan on socio-economic development for 2018 to the National Assembly for discussion and approval, with an expected growth rate of 6.5-6.7 per cent, buoyed by a surging manufacturing and processing sector and a strong inflow of foreign investment.Under a report on the plan compiled by the Ministry of Planning and Investment (MPI), to ensure a growth rate of 6.5-6.7 per cent for next year, the government has set on-year targets for some key sectors in the economy, including agro-forestry-fishery (up 3.07-3.19 per cent), industry and construction (up 7.17-7.59 per cent), and services (up 7.3-7.39 per cent).Of the industrial sector's growth, the manufacturing and processing sector, which cre-ates 80 per cent of Vietnam's industrial growth, is expected to rise 12.15-12.7 per cent on-year.The export growth target is set at 7-8 per cent.Registered foreign investment is expected to be $27.5-28.5 billion, while disbursements are projected to hit around $21 billion higher than the forecast $18 billion for this year."These targets are thoroughly weighed, based on the resolution of the 12th National Party Congress [organised in January 2016], the five-year Socio-Economic Develop-ment Plan for 2016-2020 already adopted by the National Assembly, estimations of achievements of 2017's socio-economic development, domestic and international situ-ations, and disadvantages and difficulties for 2018," said MPI minister Nguyen Chi Dung.Spain-based FocusEconomics, which provides in-depth economic analysis globally, wrote last week in a report that Vietnam's economy is expected to expand 6.5 per cent in 2018 which is up 0.1 per cent from last month's forecast and 6.5 per cent in 2019. Fo-cusEconomics estimated that industrial output will grow by 7.6 per cent in 2018, and 7.4 per cent in 2019."The economy is projected to continue along this robust growth trajectory for the re-mainder of the year and into 2018, buoyed by resilient performance in exports as new factories funded by foreign investment open, and a flourishing influx of foreign direct investment (FDI), fuelled by more attractive investment opportunities," read the re-port."Stellar growth in the manufacturing sector, a strong service sector, and a boost in pri-vate consumption buoyed by a rapid rise in private-sector credit, propelled the fastest economic expansion in over nine years," the report said.Also highly commending Vietnam's economic prospects, HSBC forecasts that the country will grow 6.4 per cent next year, thanks to strong increases in manufacturing and FDI.


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"FDI jumped sharply in this year's third quarter and should continue to trickle in to-ward the end of the year. FDI (newly registered capital) is up 30 per cent year-to-date year-on-year as of the third quarter to reach $14.5 billion," said HSBC economist Noe-lan Arbis. "As a comparison, new FDI in 2016 totalled just over $15 billion, which sug-gests that this year's numbers should easily surpass last year's."In another case, the Asian Development Bank (ADB) has predicted that Vietnam's economy will grow 6.5 per cent next year, also crediting a jump in FDI and manufac-turing."Continued buoyancy in FDI inflows should add impetus to growth in the coming months, as should the recent easing of monetary and credit conditions," said an ADB report on Vietnam's economic prospects released last month. "Other economic indica-tors also point to strong growth next year. The manufacturing Purchasing managers' Index continues its rising trend. New orders have risen continuously since December 2015 to signal improving business conditions for manufacturers."However, the government admitted that achieving a 6.5-6.7 per cent economic growth for next year, which might be the same as this year, is a difficult mission. This comes in light of new potential challenges the economy could face next year, such as import tax reductions due to international and regional commitments and decreases in the ex-ploitation of minerals, coal, crude oil, and gas.For example, the government will likely reduce the exploitation of crude oil by two million barrels against 2017."All of these challenges will have a big impact on our goals for 2018," minister Dung said.http://www.vir.com.vn/2018-economic-targets-undergo-na-inspection.html

GDP growth must rely on internal strength: economists

24/OCT/2017 INTELLASIA| VIETNAMNET

How much do internal resources contribute to the country's GDP? Economists have raised the question after the General Statistical Office (GSO) announced a record-high GDP growth rate of 7.46 percent in the third quarter of the year.GSO said the major driving force behind the high growth rate were the development of processing, manufacturing industry, export and domestic consumption (12.8 per-cent, while Samsung reported the growth rate of 45 percent); improvement in agricul-ture production and fisheries; and a sharp increase in exports (+19 percent), especially from foreign invested enterprises.Le Cao Doan, a renowned economist, noted that domestic production did not make a big contribution to GDP.Vietnam's exports increased by 8.6 percent in 2016, higher than the 8.1 percent growth rate in 2015. And the exports continued rising with $200 billion worth of earnings in the first eight months of 2017, an increase of 13 percent compared with the same period last year.The highest number of exports were not from Vietnamese enterprises, as foreign in-vested enterprises were the major exporters.Reports all show that foreign invested enterprises export more than import, while Vi-etnamese firms import more than export.Vietnam's export turnover exceeded the $100 billion threshold in 2012 ($114.5 billion).However, Vietnamese enterprises' export turnover was $50 billion in 2016. Their ex-ports increased by 4.8 percent only in the same year, much lower than the average growth rate of 8.6 percent and the foreign invested enterprises' rate of 10.2 percent.Doan said that Vietnam needs to face facts that the high jump in the GDP growth rate in the third quarter relied on exports of the foreign invested economic sector, and that internal strength has not improved.Truong Thanh Duc from the Vietnam International Arbitration centre said that it was not good news that Vietnam gained a high growth rate thanks to the foreign-invested sector."This shows the dominance of the foreign invested sector over the domestic economic sector," he said.


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Duc emphasized that though the proportion of the foreign invested sector's exports has increased rapidly from 57 percent in 2005 to 67 percent in 2013, its contribution in terms of added value to GDP has increased inconsiderably from 15.2 in 2005 to 18.07 percent in 2015.Regarding the quality of growth, Doan pointed out that while the GDP grew sharply in the third quarter, the 9-month inflation rate was very low at 1.45 percent.He said that the figure should be seen as an indicator of a downward trend. In princi-ple, when Vietnam wants a high GDP growth rate, it has to accept a certain high infla-tion rate.http://english.vietnamnet.vn/fms/business/188425/gdp-growth-must-rely-on-inter-nal-strength--economists.html

For the UNDP, Vietnam a model of growth


Since the inception of the Doi moi era in 1986, Vietnam has racked up some impressive achievements in socio-economic development. Kamal Malhotra, UN resident co-ordi-nator and the UNDP's resident representative in Vietnam, writes about the UNDP's as-sessment of Vietnam's economic reforms and their prospects in boosting cooperation with the country.Since Doi moi in 1986, Vietnam has achieved a significant transformation of its eco-nomic structure. As part of this process, it successfully integrated with the global econ-omy, adopting a socialist-oriented market economy with state-owned enterprises.Also as part of this process, Vietnam has been trying to move from resource based and low skilled labour intensive production to medium and high technology production as a result of its economic restructuring. Progress on this front has been very limited, however, because of a number of supply side constraints such as the quality and skills of its human capital, the state of infrastructure and many enabling environment policy constraints. While strong political commitment and the full support of economic and social stakeholders have significantly contributed to this reform process, political re-forms to enable economic and social reforms have been gradual and need to be accel-erated to enable the next necessary phase of economic and social transformation. This will not be possible without bolder political reforms to create a more enabling environ-ment.More specifically, in the first phase of reforms, land reform provided for recognition by the state of private land use rights, the foreign investment law accelerated foreign direct investments, the company law acknowledged the recognition of private owner-ship, and the law on enterprises and the common law on investment created incentives for investors.After establishing the legal framework to carry out these structural reforms, the roles of state and the market were more effectively and efficiently balanced and defined. In this period, Vietnam also joined Asean, became a member of the World Trade Organ-isation (WTO), and signed the now stalled Trans-Pacific Partnership agreement as well as bilateral and multilateral trade agreements that strengthened the trade liberalisation process and its integration with global markets.In the period 1986-2008, GDP per capita increased more than fivefold increase since 1986 and reached $2,100 as a result of an average annual growth rate of 6.7 per cent which represented the third highest in the region(1), while poverty declined from 58 per cent in 1993 to around 7 per cent in 2015(2).As of 2010, Vietnam was elevated from low income country to lower middle income country status as a result. However, in more recent years, economic growth has slowed and needs fresh sources of momentum. The acceleration of appropriate domestic po-litical reforms will also be essential to ensure more rapid and sustainable economic growth and to allow Vietnam to adapt to the fast changing global economic landscape.While the Vietnamese economy has successfully integrated with global markets, this success has been largely fuelled by a combination of exports in low skilled labour in-tensive, natural resource and foreign direct investment (FDI) based sectors(3). Howev-er, even though FDI based exports contribute the lion's share in total exports, they are


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based on limited backward linkages in the domestic economy.This situation strongly signals that Vietnam cannot continue to carry out its existing growth model if it wishes to enhance the future prospects of the country. A new growth model needs to be constructed that will focus especially on quality issues. More specifically, higher technological value-added, productive and dynamically competitive sectors need to be key ingredients of a new growth model. The govern-ment needs to take the necessary steps to strengthen these key qualitative dimensions of the domestic economy.There are also challenges which the Vietnamese economy faces arising from shifts in the global technological frontier and the rise of automation which should be seriously considered. In that respect, necessary actions should be taken to increase human re-source skills and the technological base. Only then will it be possible to increase the value-added share of Vietnamese companies in global value-chains.Vietnam's growth performance started to decelerate after the global economic crisis. After Doi moi, the welfare of society increased but with some distortions. As a result, while the Vietnamese economy has converged to the middle-income country grouping and the percentage of poor people has fallen to single digit levels, there are a signifi-cant number around 70 per cent of the population) whose income levels are very close to the poverty line. As a result, Vietnam needs to urgently carry out structural reforms to further transform its economic structure through more productive and higher value added competitive sectors to create decent jobs so as to support its "missing middle" population and avoid the middle income trap in the future. Institutional reforms in the fields of public administration, public investment, and state-owned enterprises (SOEs) are among those which will need to be accelerated to address existing distortions in the economy.There have also been significant changes in the fundamentals of the global economy after the global economic crisis and Vietnam needs to adapt herself to this changed en-vironment proactively. As a result, legal frameworks need to be introduced that will empower the role of an independent and robust private sector in the economy to create a productive and competitive market structure.In this context, the role of state needs to change to focus on establishing and providing an effective regulatory and supervisory framework with greater emphasis on trans-parency. These measures, taken together, will lead to more robust, inclusive and sus-tainable economic growth.UNDP will continue to support the reform process. The existing reform agenda is ex-amined and a number of policy recommendations were made in UNDP's last National Human Development Report (NHDR) for Vietnam.To follow through on these recommendations, a recently initiated study will analyse, the productivity and competitiveness structure of Vietnam's economy by examining backward and forward linkages in value chains.By doing so, the weakest and the strongest components of different sectors and their value-added capacity will be determined and necessary policies designed and imple-mented to increase their productivity and strengthen their competitive power.Through another UNDP study, more appropriate and integrated economic models will be developed for the Vietnamese economy in order to strengthen the intellectual capacity of the relevant ministries and the national statistical institute. Through this study, national modelling and statistical capacity will be strengthened and policy op-tions, based on more rigour and analysis, should underpin the government's future policy decisions.Through yet another UN programme, implementation of the Sustainable Develop-ment Goals (SDGs) will be supported and reported through the Voluntary National Review (VNR) which will be presented at the UN's High Level Political Forum on the SDGs in July 2018 in New York and through Vietnam's national 2018 SDG report. The UN will continue to play a key support role at various levels in Vietnam's VNR prep-aration process. The SDGs can be an appropriate platform for Vietnam to show her vi-sionary


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perspective through strategically-designed and well-implemented structural policies which serve to fulfil the 2030 Agenda.Vietnam's recent experience has been remarkable for its simultaneous achievements of a dramatic reduction of poverty, sustained high economic growth rates and high levels of exports which together have contributed to its economic and social transformation from an impoverished, war-devastated country to a modern and dynamic society in just a generation. However, this transformation can only be sustained and taken to the next level if there is a consistent and simultaneous implementation of higher value-added productivity, appropriate institutional strengthening and governance policies.The UN will be pleased to continue to play a key role in this process. We are celebrat-ing the 40th Anniversary of Vietnam joining the UN in 2017 and it is clear that the UN has played a very special, indeed unique role in contributing to Vietnam's successful trajectory over the last 40 years.I expect our engagement with the government of Vietnam to continue to strengthen during its development journey over the coming decades.http://www.vir.com.vn/for-the-undp-vietnam-a-model-of-growth.html

Divestment and equitisation hardly reach target

24/OCT/2017 INTELLASIA| NGUOI LAO DONG

Up to now, 34 state-owned enterprises (SOEs) have completed divestment and equiti-sation tasks. The remaining 10 SOEs are large-scale SOEs operating in multi industries with complicated financial situation which needs the participation of many big inves-tors with financial potential and good investment and governance capacity.According to the plan, the Vietnam Dairy Joint Stock Company (Vinamilk), Saigon Al-cohol Beer and Beverages Corporation (Sabeco), and Hanoi Alcohol Beer and Beverag-es Corporation (Habeco) must complete divestment by the end of this year. However, so far, only Vinamilk has announced detailed plan to sell 3.33 percent of its charter cap-ital which is represented by the State Capital Investment Corporation (SCIC).Chair of SCIC's Board of Members Nguyen Duc Chi said that the work related to the second sale of capital in Vinamilk was completed. There will be three sessions intro-ducing opportunities to invest in SCIC shares at Vinamilk (roadshows) held in Singa-pore, Hong Kong and Hochiminh city international financial centers. In particular, the roadshows in Singapore have attracted 24 investors, while 11 investors in Hong Kong are interested and have registered to participate. Most of them are new investors and belong to big financial investment funds such as Blackrock, Wellington Mana, JP Mor-gan Assets Management, and Allianz Global Investors, etc. Specifically, on October 18th, SCIC and Hochiminh Stock Exchange (HOSE) joint held roadshow in Hochiminh city with the participation of Vinamilk's general director Mai Thi Kieu Lien.Regarding the roadmap to sell shares, SCIC announced information about the Regula-tion on the sale of shares at the latest on October 21st. The starting price will be an-nounced and Registration and deposits of investors will be received from November 1st. The competitive offer is scheduled to be held on HOSE on November 10th."According to our assessment, of the major enterprises having plans to divest in the fourth quarter, Vinamilk was the first one to finalise the schedule. Hopefully the public sale of 3.3 percent Vinamilk's shares will achieve good results", said SCIC's Chair of Member Board.Contrary to Vinamilk, the information on Sabeco's and Habeco's divestment has not been released. To speed up the progress, Ministry of Finance (MOF) has proposed the prime minister to instruct Ministry of Industry and Trade (MOIT) to complete the sale of capital in these two units and transfer the capital to the Fund to support the restruc-turing and development of enterprises prior to December 1st 2017.In the case when the MOIT has not completed the disclosure of the state capital with-drawal announcement in Sabeco and Habeco before September 30th 2017, the agency must transfer the right to represent ownership in Sabeco and Habeco to SCIC in order to ensure faster capital divestment, because SCIC is specialises in capital divestment. However, according to Dang Quyet Tien, director of Corporate Finance Agency (MOF), the MOIT has so far not submitted the plan to sell capital in these two SOEs.


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Tien said that there are three groups of measures to accelerate the equitisation process and divestment in SOEs, including completion of institutions, implementation, and promotion of propaganda. In particular, the group of institutional measures have been ready as the obstacles and barriers were resolved by Resolution 84 on equitisation in oil and gas enterprises with capital scale of up to 20 trillion dong, etc. The prime min-ister has assigned the working group of the government as well as of the MOF to go inspect and urge the implementation of tasks.Regarding the implementation measures, since the Vietnam's stock market is small, if the large supply is poured at the same time, the demand can hardly be met. Thus, the foreign investment flows from Japan, and Korea, etc. should be called.Concerning the issue of propaganda, the progress of equitisation must be published and regularly updated on the websites of the government and MOF to have the basis for inspection and acceleration.

National Assembly gathers to weigh focal laws


The fourth session of the 14th National Assembly has kicked off this morning, with major measures on the agenda to promote the country's further growth.At the opening ceremony, National Assembly Chairwoman Nguyen Thi Kim Ngan stated that during this 26-day session, the legislature will consider and ratify six bills and 10 resolutions, and review nine bills (see box for details)."These laws and resolutions are very important and they have drawn great attention from the public," Ngan said. "They are also important for implementing regulations on the market economy, boosting the economic restructuring, and improving the national business environment."During the session, the National Assembly will also review, debate and give opinions on a number of reports regarding the socioeconomic situation of 2017, the objectives of socioeconomic development for 2018, and the allocation of the 2017 national budget."The domestic economy has been witnessing quite positive developments in a multi-tude of areas, with the investment and business climate significantly improved, and the continued assurance of improving living conditions, as well as the country's rising position and prestige in the global arena," stated prime minister Nguyen Xuan Phuc.He reported to the National Assembly that the economy grew by 6.41 per cent in this year's first nine months, higher than the 5.99 per cent in last year's corresponding pe-riod."It is expected that the economy will grow by 6.7 per cent this year, reaching the Na-tional Assembly's target set earlier," Phuc affirmed.In this year's first nine months, 17 out of the economy's 21 key sectors, excluding the mineral sector, witnessed increases.For example, the nine-month industrial index for production (IIP) ascended 7.9 per cent year-on-year, higher than the 7.1 per cent rise in the corresponding period last year. IIP in September reached 13.2 per cent year-on-year.The processing and manufacturing sector, which contribute to 80 per cent of the indus-trial sector's growth, expanded 12.8 per cent, higher than the 11.7 per cent in the same period last year, "also the highest ascension of this sector over the past many years, contributing to 9 per cent of the economy's nine-month growth," according to the gen-eral Statics Office (GSO)."Enterprises' production and confidence are on the rise," Phuc said.According to a recently released GSO survey on manufacturing and processing firms in Vietnam, 41.5 per cent of respondents reported that their third-quarter business was better than previous quarters. 52.6 per cent expected better business in the last quarter, and 54.2 per cent forecasted that their production will increase.In this year's first nine months, Vietnam saw nearly 94,000 newly-established enterprises registered at more than $41 billion, up 15.4 per cent in the number of enterprises and 43.5 per cent in capital year-on-year. The economy's total newly-registered and newly-added capital was $97.5 billion.In addition, about 21,100 enterprises resumed operations in this year's first three quarters.


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Laws for adoption:Law on Forest Protection and Development (amended)Law on Aquaculture (amended)Law on amending and supplementing a number of articles of the Law on Credit Or-ganisationsLaw on PlanningLaw on amending and supplementing a number of articles of the Law on Overseas Representative Missions of the Socialist Republic of VietnamLaw on Public Debt Management (amended)Laws for discussion:Law on National Defence (amended)Law on Cyber SecurityLaw on Measuring and MappingLaw on Protecting State SecretLaw on amending and supplementing a number of articles of the Law on Sports and Physical TrainingLaw on CompetitionLaw on Denunciation (amended)Law on Preventing and Fighting Corruption (amended)Law on Special Administrative-Economic ZonesResolutions for adoption:Resolution on 2018 socioeconomic development planResolution on 2018 national budget estimateResolution on 2018 central budget allocationResolution on a project on land withdrawal, site clearance compensation, support and resettlement of Long Thanh International AirportResolution on constructing a number of expressway sections of the North-South route in the eastResolution on implementing the Law on PlanningResolution on interpellation and responseResolution on supervising obedience of policies and law on reforming the state appa-ratusResolution on mechanisms and policies for the development of HCM CityResolution on supervising the implementation of policies and law on state apparatus reformhttp://www.vir.com.vn/national-assembly-gathers-to-weigh-focal-laws.html

Vietnam reports over $1 billion in trade surplus


Vietnam had a trade surplus of $707 million in the first half of this month, taking the total in the year to mid-October to $1.09 billion, according to data of the general De-partment of Vietnam Customs.According to a trade sector performance report in the first 15 days of this month, Viet-nam's exports totalled $8.95 billion and its imports reached $8.24 billion. From January to October 15, the country made $163.25 billion in export revenue and spent $162.16 billion on imports, up 20.2 percent and 21.7 percent year-on-year respectively.According to the customs, Vietnam struggled with the trade deficit on a monthly basis in the first half of this year, leading to a trade gap of nearly $2.78 billion.However, the situation changed for the better as the country's trade made a turna-round in July with a surplus of $266 million. But a month later, a trade deficit returned with $842 million.Last month the trade sector made a remarkable turnaround with a trade surplus of $330 million.The customs said domestic enterprises were responsible for the trade deficit as foreign-invested firms brought a high trade surplus.


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Big EU demand for small shrimps


Shrimp exports to the European Union (EU) increased constantly in August and Sep-tember, making it the biggest consumer of the Vietnamese product, according to the Vietnam Association of Seafood Exporters and Producers (Vasep).Vasep has reported that shrimp exports to the market in June and July came to a stand-still due to supply shortage and price hikes, while EU businesses reduced their shrimp imports. However, since August, exports to the EU have been restored with increased supply from domestic businesses.The country's shrimp export revenue hit $2.5 billion in the first nine months, up 21.9 per cent against the same period last year. Exports to the EU grew 32 per cent in this period.Vasep said that to boost exports to the market, businesses should pay more attention to labels and the quality of products to build brand names and expand markets. They should make proper plans to improve their competitiveness against other exporters, such as India.The EU tends to increase its shrimp imports in the remaining months of the year to serve cultural and food festivals, offering a chance for domestic businesses to spur ex-ports.Trn Vn Phm, director of the Soc Trng Seafood Joint Stock Company, said an important factor was to provide clean raw materials to the export shrimp processing industry. This means that Vit Nam's shrimp industry must invest more in technology and the equipment for processing.To form a large-scale production system, each enterprise must have a large area with synchronous investment at all stages, and then reduce the production costs to improve the quality of products for higher profits.Ma Huy, deputy director of Ca Mau Agricultural Extension Centre, said the growth of shrimp exports to Europe promoted domestic shrimp consumption at high prices. The price was VN220,000 per kilogram (30 units of shrimp) and VN190,000 per kilogram (40 units).Shrimp exporters like to buy shrimp that have 70 to 100 units per kilogram to meet the demands of European consumers.http://vietnamnews.vn/economy/416097/big-eu-demand-for-small-shrimps.html#TwxHXqhZSLuLf8fl.97

Vietnam seeks to export pork


Local pig farmers and processors are working on plans including building disease-free areas to export pork next year.On the sidelines of a forum held in Hanoi on October 20 to find ways to promote Viet-nam's pork export, deputy minister of Agriculture and Rural Development Vu Van Tam said Vietnam has the potential to export livestock.The country has signed 12 free trade agreements (FTAs) which will facilitate the export of processed, frozen and fresh pork products.Vietnam is restructuring the livestock sector to increase the value and quality of prod-ucts and cut prices by applying new technology and ensuring food safety and hygiene.Tam underlined the need to develop areas free from diseases such as foot and mouth disease.Gabor Fluit, general director of De Heus Group Asia which participates in pork supply chains in Vietnam and provides consulting services for local pig farmers and pork processing firms, said the government and pork exporters should upgrade farming in-frastructure and build disease-free areas. South Korea, Singapore, Japan, Russia and China might be key importers of pork from Vietnam.Although Vietnam earns high export turnover from farm produce, at $30 billion a year, and more than a dozen agricultural products have annual export revenue of billions of US dollars. But the export of livestock products remains insignificant.According to the Department of Animal Health under the Ministry of Agriculture and Rural Development, Vietnam has eight slaughterhouses supplying frozen pork for ex-


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port to Hong Kong and two providing pork for Malaysia with a total volume of 20,000 tonnes per year. These slaughterhouses are of small scale and meet requirements of Hong Kong and Malaysia only.Products made from pork in Vietnam have been shipped to the US, Australia, Hong Kong and Macau.The Department of Animal Health is supporting East Sea Trade Developed Investment Corporation, Dabaco Group and CJ Cau Tre Food JSC to export livestock products to Japan, South Korea and Russia.Vu Trong Nghia, director of East Sea Trade Developed Investment Corporation, said his company has invested in two safe pig farms in the northern province of Nam Dinh and cooperated with the high-quality livestock breeding centre at Vietnam National University of Agriculture to apply advanced technology in production.Last year, the Ministry of Agriculture and Rural Development called on farmers and agencies to develop disease-free areas in Thai Binh and Nam Dinh provinces but the projects have since been stalled as they need huge capital. The corporation would build a disease-free area 15 to 20 kilometers from its factory, said Nghia.http://english.thesaigontimes.vn/56697/Vietnam-seeks-to-export-pork.html

Vietnam doubles efforts to improve business environment


Vietnam's business environment and competitiveness have been improved signifi-cantly over the past three years thanks to a range of solutions, according to the Minis-try of Planning and Investment (MoPI).The country's efforts have been reflected through the World Bank's ease of doing busi-ness rankings in 2016, in which Vietnam climbed to the 82nd position from the 91st last year. This is the first time the country has made a big stride in the rankings since 2008.Vietnam also claimed the 47th position among 127 economies surveyed in the 2017 glo-bal innovative index (GII) report, the highest ranking to date, up 12 places from last year's report, according to the World Intellectual Property Organisation (WIPO).The World Economic Forum (WEF)'s Global Competitiveness Report 2017-2018 re-leased in September also ranked Vietnam 55th overall, up five places from 2016.However, the MoPI said that the quality of regulations on business conditions re-mained low, showing a lack of a management system based on risk assessment.Besides, the supervision system of regulations on business conditions has proven inef-fective, the ministry said, pointing to inadequate acknowledgement of reforms of li-cences and business conditions.The ministry, therefore, proposed abolishing about 3,000 unnecessary, irrational, inef-fective business conditions and revamping State management over production and business activities on the basis of principles and practices set by the Organisation for Economic Cooperation and Development (OECD).The ministry has called on the prime minister to request ministers and Chairpersons of municipal and provincial People's Committees to closely supervise the implemen-tation of Resolution No. 19 on tasks and solutions to improve the business environ-ment and national competitiveness.The ministries should promptly review and propose reducing investment and busi-ness conditions in the State management area and report to the PM before December 2017, the MoPI said.At the same time, the MoPI will partner with the government's Office and relevant ministries to organise more dialogues with enterprises to clear up their concerns and petitions in a timely manner.https://en.vietnamplus.vn/vietnam-doubles-efforts-to-improve-business-environ-ment/119912.vnp

Tourism makes up low proportion of GDP


While in many countries tourism contributes remarkably to the economy, it makes up less than seven percent of Vietnam's GDP. The figure is modest compared to the coun-try's potential.


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Vietnam is home to eight world natural heritage sites and 11 intangible cultural herit-age sites recognised by UNESCO, a vivid manifestation of a beautiful and diversified culture country.The country also boasts more than 3,000km of coastline and thousands of islands and islets together with pristine beaches.However, the tourism sector's contribution to the GDP is below seven percent. What are the reasons behind this?According to Nguyen Anh Duong, economic expert at the Central Institute for Eco-nomic Management, the first reason is infrastructure, including supporting services which fail to meet tourists' demand."As a result, visitors to Vietnam enjoy sightseeing but not during a long stay", he said, adding that some travel organisations do not apply the same service prices for foreign tourists and domestic ones, which gives a bad impression to foreign visitors.Service quality, product prices are also issues of visitors' concern when they visit Viet-nam.Nguyen Linh, Executive manager from A Travelmate Company suggested traffic signs be in both Vietnamese and English.Added to this, visas should be granted at border gates to simplify administrative pro-cedures and save tourists and travel agents' time, he said.The tourism sector plays an important role in boosting other economic sectors, such as transport, entertainment, trade and several supporting services, such as communica-tions and banking."To carry out the Politburo's resolution to turn tourism into an economic spearhead, we have proposed strengthening the development of infrastructure, including road, aviation, railway, and sea links," said Pham Phuong Thao, deputy head of Travel De-partment under the Vietnam Administration of Tourism.The tourism sector is aiming to make breakthroughs. The sector needs to follow the market's demand and adapt to socio-economic and political changes at home and abroad.https://en.vietnamplus.vn/tourism-makes-up-low-proportion-of-gdp/119911.vnp

PM calls for better cooperation among Apec members


Asia-Pacific Economic Cooperation (Apec) economies should strengthen cooperation and policy coordination, and roll out workable solutions to their problems, prime min-ister Nguyen Xuan Phuc was quoted by local media as saying on October 21.In his remarks at the 24th Apec Finance ministers' Meeting, the most important event of the Apec Finance ministers Process, which wrapped up in the ancient city of Hoi An in Quang Nam Province on October 21, he said Apec economies are facing a slew of difficulties and challenges.Gross domestic product (GDP) growth in some member economies has remained low, he noted, adding that according to Asian Development Bank forecasts, regional trade growth has slowed due to increasing protectionism, non-tariff barriers, difficulties in the Fourth Industrial Revolution, and impacts of climate change.The PM said the region has some hotspots which may threaten peace, security and sta-bility.In the past years, he said, Apec finance ministers have worked together towards their goals of fostering economic connectivity, promoting innovative and inclusive growth, and improving the competitiveness of small and medium enterprises.He spoke highly of the four priorities in the Apec Year 2017, which include long-term investment in infrastructure, tax avoidance through base erosion and profit shifting, disaster risk financing and insurance, and financial inclusion.Vietnam has made great strides in its economic restructuring in the last three decades, he said. Having been an underdeveloped economy, the Southeast Asian nation has be-come a middle-income economy since 2010.He added the country's GDP growth stood at 6.21 percent last year, and the figure is expected to rise to 6.7 percent this year. Meanwhile, its inflation may be kept at below


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5%, budget deficit below 4%, and public debt below 65 percent of GDP by end-2017.Export revenue is expected to exceed $200 billion this year, a year-on-year rise of 15%, and disbursement of foreign direct investment is estimated at over $15 billion, up 18%, he said.The Vietnamese stock market had surpassed 800 points as of end-September, a record high since 2008, and stock market capitalisation had reached 93 percent of GDP, he said, and the nation aims for average annual GDP growth of 6.5-7 percent in the 2016-2020 period.The 24th Apec Finance ministers' Meeting and relevant events attracted around 300 domestic and international delegates, including finance ministers, leaders of the cen-tral banks of the 21 Apec economies and representatives of the International Monetary Fund (IMF), the World Bank (WB), the Asian Development Bank (ADB) and the Or-ganisation for Economic Cooperation and Development (OECD).The Apec finance ministers also issued a joint statement, stating their views on a wide range of issues.http://english.thesaigontimes.vn/56692/PM-calls-for-better-cooperation-among-Apec-members.html

Storm brewing over special tax regime proposal


A special high tax proposed by some provinces and cities is being questioned by econ-omists due to its controversial impacts on Vietnam's tax policies.In a meeting with prime minister Nguyen Xuan Phuc in September, leaders of HCM City said that they would make further requests for specific financial policies, includ-ing surcharge and control-incurred expenses, which are not regulated under the law on fees and charges.Following this, Hanoi and Hai Phong City asked the government to allow them to im-pose special tax mechanisms."These requests are necessary and reasonable. Hanoi has its own Law of Capital, but the final decision has to be made by the National Assembly," said Hoang Anh Tuan, deputy finance minister.The Law of Capital is the legal mechanism used to address Hanoi-based issues.Tuan said other countries had allowed their major cities to adopt special tax policies. Because of the better infrastructures, city residents were required to pay higher income tax, while some big companies were forced to contribute three to five per cent of their revenue into the local budget.Vu Hoang Quyen, senior economist of the World Bank (WB), recommended the Viet-nam government permit economic centres to impose the surcharge policy, especially on personal income tax, enterprise income tax and excise tax."However, the government should carefully apply the change, aiming to help provinc-es get more motivations and achieve high growth," added Quyen.Do Quoc Binh, head of Hanoi Taxi Association, on the other hand, said the tax increase should be reasonable."We cannot say that because business environment in big cities is more favourable, companies should pay higher tax," Binh said.Economist Ngo Tri Long is concerned that the change will create exclusive rights for some provinces and cities, causing inequalities in the national economy. He said the special tax should specify what the extra money should be used on, such as traffic con-gestion or pollution."I wonder whether residents and companies in big cities really have better services or is the shortfall due to overspending leading to budget deficits?Moreover, according to Long, the government has endowed big cities by providing generous investments or State budget ratios.Furthermore, Truong Ba Tuan, vice head of the National Institute for Finance, said the government should not allow provinces to make surcharges since it would arouse a race for priority lobbying."Some countries adopting a special tax regime, including Canada. However, the gov-


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ernment should apply any change cautiously in Vietnam," Tuan said.According to the WB report, only 13 of 63 provinces of Vietnam submit a portion of their charges to the State budget, the others still receive government financial support. Therefore, the country should create conditions for provinces to control the fees and charges in their localities to increase motivation and competitiveness.http://bizhub.vn/news/storm-brewing-over-special-tax-regime-proposal_289659.html

Shifting burden 24/OCT/2017 INTELLASIA| VN ECONOMIC TIMES

On a Sunday morning at Thai Ha market in Hanoi, Pham Thu Huong, a 28-year-old office worker picking up some food for her family, wondered what she could cut from her everyday spending if the government ratifies value added tax (VAT) increases."I'm very concerned, as the increase would definitely affect our family's monthly ex-penditure," she said."Our monthly income is just over $700, from which we have to pay regular living costs like electricity, water, internet, school fees and gasoline, which account for more than half of our total income."If the VAT rate is indeed raised from 10 to 12 per cent, Huong will have to fork out an additional $10-15 each month."It's not a huge amount but it adds up over a year and is significant for every house-hold, especially given that low-income earners are the majority in the country," Nguy-en Tri Hieu, an economist, said.Tightening belts Nguyen Van Huynh, a technical worker with a garment company at the Tan Binh In-dustrial Zone in HCM City, agrees with Hieu. Both the rich and the poor must pay for basic necessities like electricity, water, milk for children, gasoline, and clothes, which would all be subject to the VAT hike.Workers and the poor already have a tough time, and now must pay more. "For rich people, a 2 per cent increase in VAT is nothing, but for poor people, the extra tax would cost a couple of meals for a family," he said.Many other low-income earners also expressed their opposition to any VAT increases. A World Bank report in 2015 found that Vietnam was still among lower middle-in-come countries despite GDP per capita increasing $57 compared to 2014.And according to the general Department of Taxation, Vietnamese people earning less than VND10 million ($440) per month account for 70 per cent of those paying personal income tax.Among the debate, some local authorities have explained that VAT on many types of essential goods will not rise and so not affect living standards, and "will not lessen na-tional consumption," said Nguyen Thi Cuc, Chairwoman of the Tax Consultants' As-sociation."This draft law is aimed at restructuring State budget revenue in the context of the country's direct tax resources becoming lower," she said.Theoretically, all types of indirect taxes are regressive, so the level of impact will be de-pendent upon the types of goods and services people buy or use, according to Pham Dinh Thi, director of MoF's Tax Policy Department."Vietnam as well as other countries has regulated that certain groups of goods and services are subject to no or low VAT tax rates, in order to diminish regression in indi-rect taxes," he said.He added that a General Statistical Office report in 2014 on living standards revealed the lowest income group spent up to 59.6 per cent of their income on food and medical and educational services, while the highest income group spent 39.6 per cent.However, what concerns Huong and Vietnamese consumers is that when VAT rates increase, every single item will rise in price. VAT targets end-users and the impact would be widespread because goods used to produce essential commodities will also increase in price, according to Hieu.Moreover low-income earners would have to spend a greater proportion of their in-come on essentials, raising their tax burden compared to earnings. "A VAT hike would


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make low-income earners more vulnerable," he said.Economist Le Dang Doanh, former President of the Central Institute for Economic Management (CIEM), said that raising the VAT rate would certainly make commodity prices higher, and local people would have to curb their consumption and reconsider daily spending.Figures from MoF, he said, are not persuasive, as tax policies generally accompany other measures such as social welfare, infrastructure, and education and should be cal-culated on people's income levels, not on comparisons with other countries.Side effectsThe VAT hike is said to not only effect low-income earners but would also significantly affect the macroeconomy through severe impacts on national consumption. Many economists say that raising taxes is a bad sign for the economy, is it reveals a growing budget deficit.The government needs to bolster budget revenue, which will cause interest rates, pro-duction costs for businesses, commodity prices, and people's spending to rise accord-ingly and leave a mark on economic growth.Meanwhile, a representative from MoF insisted that increasing the VAT rate would have little impact on low-income households.According to estimates by the ministry, the VAT hike may push up the consumer price index (CPI) by 0.06-0.39 per cent, while it grew just 1.23 per cent in August compared to December last year and 3.35 per cent year-on-year, with core inflation in August ris-ing 1.31 per cent year-on-year.Nevertheless, a recent report from Viet Dragon Securities pointed out that there would be no significant impact on inflation, but due to the lack transparency in calculation methods it remains suspicious about the level of effect. At present, many Vietnamese economists are concerned about the impact of a VAT hike on household spending needs, income distribution, and implicit economic activities."According to Euromonitor, although Vietnam has good economic growth, it is fore-cast that the majority of Vietnamese consumers will still be on low incomes until 2030," the report noted. "Therefore, the VAT increase could make consumption weaken."A raft of economic experts also said that based on actual observations, a VAT increase would raise the size of Vietnam's informal economy, which accounted for an average of 15.1 per cent of GDP between 1991 and 2015. If it develops strongly once more, GDP growth will be hit.Compared to other developing countries in the region, Dr Huynh The Du from the Ful-bright Economics Teaching Programme said, the tax burden in Vietnam is heavy and budget spending is huge.Budget revenue versus GDP in the 2006-2012 period was 22.6 per cent, compared to Thailand's 16.31 per cent, Malaysia's 14.79 per cent, and Indonesia's 12 per cent, while being lower than Japan's.Budget expenditure versus GDP in 2016, Du went on, was 28.3 per cent; higher than regional countries. "This shows that a heavy tax burden has impacted significantly on people, businesses, and the competitiveness of the economy," he said. "For enterprises with low competitiveness, the tax increase will add to their problems." Le Xuan Nghia, director of the Institute for Business Development Studies, said that any increase to VAT would push up prices and reduce the competitiveness of enter-prises. "Many countries around the world have limited indirect taxes, some at 10 per cent, some with 5 per cent," he said. "Raising the VAT would hit the poor."He added that it is important to improve the country's business investment environ-ment so that enterprises can expand production.From there, it would be possible to grow budget revenue without raising taxes. At the same time, expenditure must be curbed. "If both of these were done in parallel, the State budget would increase without higher taxes," he said.Although there would be adverse effects on the economy, according to some experts, the increase in VAT could provide medium-term benefits in reducing the budget def-icit. In 2016, VAT contributed 24.5 per cent to State budget revenue.


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If the new tax policy was to be introduced in 2019, more than $3.08 billion (VND70 tril-lion) in additional revenue would flow into the State budget."This is a huge number compared to the size of the budget deficit target in the 2016-2018 period," the Viet Dragon report noted.Assessments of the impact from a VAT increase on the macroeconomy have many as-pects to consider, according to Viet Dragon, as increasing VAT can lead to higher in-flation, falling aggregate demand, and acceleration income inequality.Increasing VAT rates is seen as part of fiscal tightening policies, so policy makers need to come up with additional policies to see the change passed by the National Assembly next year.http://english.vietnamnet.vn/fms/business/188835/shifting-burden.html

Electronic tax collection, customs clearance piloted


The general Department of Vietnam Customs will pilot the electronic tax collection and customs clearance 24/7 with five banks.The agreement was signed in Hanoi from October 23 with the Commercial Bank for Foreign Trade of Vietnam (Vietcombank), the Vietnam Commercial Bank for Industry and Trade (VietinBank), the Bank for Investment and Development of Vietnam (BIDV), Military Commercial Bank (MB Bank), and the Vietnam Technological and Commercial Bank (Techcombank).Deputy director general of Vietnam Customs Nguyen Duong Thai said the project is part of efforts to reform administrative procedures by cutting tax payment and cus-toms clearance time to the average level of Asean-4 countries as requested by the gov-ernment.It is a key project of the general Department of Vietnam Customs this year to support businesses in tax payment via the Customs e-Payment Portal at https://epayment.cus-toms.gov.vn/epaymentportal/login round the clock.https://en.vietnamplus.vn/electronic-tax-collection-customs-clearance-piloted/119937.vnp

HCM City sees science and tech as driving forces for growth


Science and technology will be driving forces for HCM City to obtain high yet sustain-able growth, said the city's government leader.Speaking at the 21st Annual Conference of Asian Science Park Association (ASPA 21) held in HCM City on October 20, Nguyen Thanh Phong, chair of the HCM City Peo-ple's Committee, said science and technology would contribute to ensuring the high quality of growth.The city wants to create breakthroughs in science and technology, he noted.The city already has Quang Trung Software City (QTSC), Saigon Hi-Tech Park (SHTP) and Agricultural Hi-Tech Park (AHTP), he said, adding the city, the country's largest economic centre, is developing a 200-hectare science park in District 9 which will cost a total of VND4.3 trillion (US$189.31 million). The park will develop green and space technologies, information technology and renewable energy, Phong added.The city has so far attracted 130 hi-tech projects worth $6.8 billion and the added value of hi-tech products reaches 28 percent on average. By 2020, the sector is expected to contribute 10 percent to the city's gross regional domestic product.The city has asked scientists, economists and international organisations for help to ob-tain its targets.City vice chair Tran Vinh Tuyen said at the conference that the city would establish more science parks, large tech corporations and research centers; improve infrastruc-ture and the investment environment; develop human resources; and promote inter-national integration in technological and economic terms.Japanese experts and scientists said science parks in Japan are responsible for provid-ing technological services and supporting startups. They can also attract investment in scientific research, and application of biotechnology in production and people's life.Duck Ryul Hong, president of Daegu University in South Korea, highlighted the role


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of science parks in the Fourth Industrial Revolution, saying they should be invested to increase the quality and added value of local products, connect enterprises, universi-ties and research institutes, and encourage investment funds to support startups.Yeong Junaq Wang, director of Hsinchu Science and Industrial Park in Taiwan, said science parks could help bolster innovation.Representatives of Asian science parks agreed that such parks could attract leading tech groups and experts, put scientific studies into play, increase localisation, and en-courage international cooperation and technology transfer.ASPA 21, themed "Science Parks in Empowering Growth Quality and Competitive-ness of National Economy," took place in HCM City from October 19 to 21 with around 400 delegates, 90 of them from Japan, South Korea, Iran, Bhutan, Singapore, Malaysia and Taiwan, attending.http://english.thesaigontimes.vn/56694/HCM City-sees-science-and-tech-as-driving-forces-for-growth.html

Vietnam needs logistics development strategy


Vietnam should have a strategy for the logistics sector to enable it to achieve higher growth, heard a conference in HCM City last week.Speaking at the conference on "Development of Infrastructure, Information System and Information Technology Application in Logistics," Vietnam Trade Information centre (VTIC) deputy director Dinh Thi Bao Linh said Vietnam's logistics sector has been rudderless.In the prime minister's Decision 200/QD-TTg on an action plan for improving the com-petitiveness of the logistics industry until 2025, Vietnam is envisaged becoming a lo-gistics centre of the region, but neither revenue target nor strategy has been adopted, Linh said.According to Linh, in addition to developing domestic trade, the government should allow other countries like Cambodia, Thailand, China and Laos to transship their goods via Vietnam ports to make the most of their logistics services.Vietnam has the potential for logistics development as its air, maritime and rail trans-portation systems are able to provide good logistics services.Trade liberalisation has helped Vietnam expand trade ties with China, South Korea, Ja-pan and Southeast Asia, among others."Trade between Vietnam and Asean countries has shot up by seven times since Viet-nam became an Asean member in 1995. Thailand, Cambodia, Laos and Myanmar are importing more machines, oil and gas, iron and steel, and fertilisers from Vietnam," she said.The emergence of border economic zones and coastal industrial zones has boosted goods flow between Vietnam and other countries. "Higher cargo transportation and storage demand is the key factor for logistics to grow," she noted.Linh suggested the government make the business environment more favourable by providing technical and financial assistance for logistics firms, investing more in logis-tics infrastructure, and develop high-quality human resources for the sector.Nguyen Thanh Han, general director of Genuine Partner Group, said the government should offer more incentives for local logistics companies, especially startups, so that they can compete with foreign rivals.http://english.thesaigontimes.vn/56699/Vietnam-needs-logistics-development-strate-gy.html

More efforts need to be made to lure foreign funds for start-ups


In the context of rapid growth of the startup movement among young entrepreneurs, start-ups' activities have expanded and have shown huge potential. Hence, more and more foreign investors have paid attention to startups. However, to lure more foreign investment, the startup community and Vietnamese policymakers need to make great-er efforts.Founded one and a half years ago, this business provides co-working spaces. After


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achieving some success, the company is looking for foreign investment funds."If we want to expand our business internationally, we will have to look for foreign in-vestors because it is very difficult to transfer inshore capital, it's very complicated and involves a lot of procedures", said Do Hoai Nam, co-founder of the Up Co-working Space.Nguyen Manh Dung, Head Representative of CyberAgent Ventures in Asean said many foreign investment funds are interested in and wanting to invest into startups in new economic sectors in Vietnam, however successfully mobilising foreign capital de-pends on startups themselves.However, it's not always easy to lure foreign investment as Vietnam faces competitors from other countries.Experts in the field have also acknowledged that to take advantage of long-term capi-tal to develop and expand, Vietnamese startups should make greater efforts to im-prove their capacity. Negotiating skills and support from policymakers are also needed.On the other hand, besides foreign funds, startups should also look for capital from the community to attract capital and expand business, while the State should introduce more supporting policies to encourage dormant capital sources towards startups.https://en.vietnamplus.vn/more-efforts-need-to-be-made-to-lure-foreign-funds-for-startups/119910.vnp

VN textile industry needs to spin a new yarn


Continued dependence on raw and auxiliary materials imports will constrain Vietnam textiles and garment industry from taking real advantage of the various Free Trade Agreements signed by the country, industry insiders say.It will also blunt the industry's competitive edge further, they add.According to a 2016 report from the Ministry of Industry and Trade (MoIT), by the end of last year, 99 per cent of cotton used in the textile industry, reaching 1.03 million tonnes worth about $1.7 billion, was imported, a year-on-year increase of two per cent in quantity and 2.5 per cent in value.Thread import turnover in 2016 also went up 8.8 per cent in volume and 5.9 per cent in value to 861,00 tonnes and $1.6 billion respectively. Import of whole fabric last year increased by 3.2 per cent over 2015 to reach $10.5 billion.Feeble at homeCurrently, Vietnam is only able to supply 0.3 per cent of domestic cotton demand and 40 per cent of thread demand, so the rest is imported chiefly from the US, China and Taiwan.Paradoxically, more than 70 per cent of the national thread output of 1.4 million tonnes is exported, while the Vietnamese garment industry imports nearly 0.1 million metric tonnes of high-grade fibre from China, Korea and Taiwan per year.Each year, Vietnam earns tens of billions of dollars from textile and garment exports, but businesses make modest profits of less than $2 billion because the garment indus-try spends more than half of its earnings on importing raw materials, according to the MoIT.Tran Thanh Hai, deputy director of the MoIT's Import-Export Department, said in an announcement on the MoIT's online portal, that the textile industry's dependence on imported instead of locally produced raw and auxiliary materials has significantly lim-ited its competitiveness and added-value component.Domestic textile firms produce nearly 2.8 billion metres of fabric each year, meeting 30 per cent of total demand, so Vietnam still has to import up to 6.1 billion metres of fabric annually, even from countries not participating in the same major FTAS like the Trans-Pacific Partnership, the EU-Vietnam FTA, or the Vietnam Japan Economic Partnership Agreement.Regarding accessories, production facilities for sewing thread, cotton sheets, buttons, zippers, or packaging labels can be found in Vietnam, but they barely meet domestic market demand, so these have to be imported in large quantities too.


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According to a 2016 report of the Vietnam Textile and Garment Association (VITAS), the industry finds itself in the lowest value-added segment in the supply chain, having 70 per cent of exported products under outsourcing for foreign firms, 20 per cent as do-mestic production and direct sales without intermediaries, 2.9 per cent as self-de-signed and self-manufactured products, and just one per cent made and distributed under original brands.Tied in knotsNguyen Van Tuan, Chair of the Vietnam Cotton and Spinning Association (VCOSA), said during the 2016 Vietnam Textile Summit in HCM City, that the textile industry is "knotted" in the middle, i.e. highly productive in terms of making yarn and final prod-ucts, but stunted in the production of fabric and other materials.With the industry's annual growth rate at about 8 per cent, by 2025, the amount of fab-ric needed will double to 18 billion metres, meaning without further investment in do-mestic production, Vietnam will have to import 15 billion metres, said Tuan.He also said that with 7.5 million spindles, the industry's annual output is approxi-mately 1.3 million tonnes of thread; of which more than 800 thousand tonnes are re-served for export, mainly to two major markets China and Turkey.Beleaguered sectorWorse still, many countries have intensified their use of trade remedies against Viet-nam. According to the MoIT, from 2007 onwards, Vietnam's yarn and thread exports have faced seven lawsuits five anti-dumping, one anti-subsidy and one safeguard measurefrom Turkey, the EU, India and Brazil.Therefore, around 80 per cent of Vietnamese yarn is exported to China, since its cotton prices are still relatively high. However, this cannot be seen as a stable market. Once China decides to use the 11 million tonnes of cotton in storage, Vietnam's yarn market share in the country will shrink considerably, according to a VCOSA analysis.Supporting industriesSome insiders have said that the nation's textiles and garments sector can still increase productivity and localisation rate through the development of supporting industries.VITAS Chair Vu Duc Giang told the Vietnam News Agency a few months ago the FTAs are a driving force for growth, but the textile and garment industry must be pre-pared for it.Giang suggested that domestic businesses invest in the dyeing process, carry out a sol-id human resource training strategy as the 4.0 Industrial Revolution gets closer, and focus heavily on building an integrated value chain between domestic producers.Hoang Ve Dung, Vinatex's deputy general director, said at a meeting in August 2017 between Vinatex and the Vietnam Oil and Gas Group, that administrative agencies should coordinate with textile associations to push for appropriate policies on the pur-chase and production processes, covering both raw materials and finished products.According to the MoIT, total textile and garment exports in the first six months of 2017 reached $14.58 billion, up 11.3 per cent over the same period in 2016, despite difficul-ties.However, industry insiders have said that the turnover of the first 6 months is not sus-tainable.http://bizhub.vn/news/vn-textile-industry-needs-to-spin-a-new-yarn_289667.html

Vietnam is gold mine for international express delivery firms


As Vietnamese favour foreign-made products and are willing to pay more for prod-ucts they like, international express delivery firms see Vietnam as a fertile land for their business.A GDC (General Department of Customs) report shows that import/export turnover in the first eight months of the year reached $270.91 billion, an increase of 20.9 percent over the same period last year.After Vietnam joined WTO and fully opened its market, foreign express delivery firms flocked to the country. These include DHL from Germany, TNT from the Netherlands, FedEx and UPS from the US.


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The firms all follow a two-step strategy. At first, they cooperate with Vietnamese com-panies to set up joint ventures. With strong financial capability and international brands, they can easily conquer the market.Later, they quit the joint venture model and became 100 percent foreign invested en-terprises.TNT, for example, joined the Vietnamese market by teaming up with Viettrans to set up a joint venture. Meanwhile, DHL set up a joint venture with VNPT in which it held 51 percent of capital.As the firms had good business performances, FedEx and UPS, the two giants, also headed for Vietnam. UPS terminated the joint venture model and established UPS Vi-etnam, a 100 percent foreign owned company.The big players have poured big money into Vietnam and investments have been in-creasing rapidly.Experts believed at the time that the presence of international delivery firms in Viet-nam will not be a threat to domestic service providers, because the firms would focus on international services, which was not the advantage of Vietnamese enterprises. Vi-etnamese enterprises mostly targeted the domestic market.However, the recent moves by foreign delivery firms show they are taking strong ac-tion to conquer the domestic market.Several days ago, UPS announced it would increase services in 10 provinces/cities in the central and southern regions. The cut-off time has been extended by three hours.Meanwhile, the time for shipping imports/exports to and from Asia has been short-ened from two to one day, while time for the shipping for goods to and from Europe has been cut from three to two days.A senior executive of UPS Vietnam said delivery service providers have been put un-der increasing pressure. They need to provide products and services in larger quanti-ties, with higher quality, and they need to deliver more quickly and offer lower service fees.With the shortening of shipping times and extending the cut-off time, clients will have more time for production, while UPS Vietnam can deal with more orders.http://english.vov.vn/economy/vietnam-is-gold-mine-for-intl-express-delivery-firms-360860.vov

Rural market becoming more attractive to manufacturers


Rural areas, where 70 percent of the population lives and where the average income per capita has been increasing rapidly, is a market with great potential.A report by Nielsen shows that the market growth rate in rural areas in the first quarter of 2017 reached 12.4 percent, making up 51 percent of total revenue of fast-moving consumer goods, while the growth rate was just 6.5 percent for urban areas.BSA (Business Study and Assistance Centre) pointed out that the rural market has high potential with high purchasing power. All the Vietnamese goods Market Days organ-ised by the centre have been successful. The 11 market days organised in the first six months of 2016 attracted 135,000 visitors.In July 2016 April 2017, BSA joined forces with local authorities and organised 70 trade fairs in rural areas, including 50 in the south and 20 in the north. The sales at all the trade fairs were far beyond BSA's and businesses' expectations. More rural consumers want modern goods.A survey by Kantar Worldpanel in late 2016 shows that the average income of one 4-member household in rural areas is around VND7 million, while the figure is VND16 million in urban areas. However, the average spending for every shopping trip in rural areas is VND60,000, equal to 60 percent of urbanites.Kantar Worldpanel's report released in May 2017 show that the rural market grew by 31 percent over the same period last year. Rural residents made 138 shopping trips a year while urban residents made 158.Both urban and rural consumers now like convenience when buying goods and they tend to seek goods from different channels in order to have the best prices.


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Tan Quang Minh Company with the Bidrico brand has been cited by BSA as a typical success story in the rural market. While sales in rural areas only account for 20-25 per-cent of total sales to other businesses, the proportion is 70 percent for Bidrico.In 2010, the total sales of Bidrico were VND589 billion, of which VND380 billion was from rural areas. After reaping fruit in the rural market, Bidrico began conquering the urban market.Nguyen Dang Hien, CEO of Tan Quang Minh, said the competition in the rural market is not as stiff as it is in urban market, while the selling prices of Bidrico products fit con-sumer products.He also noted that while urban consumers regularly change the products they use, ru-ral consumers are more loyal.My Hao, a cosmetics brand, has been selling well in the rural market which brings 80 percent of its total revenue, according to Luong Van Vinh, its CEO.http://english.vietnamnet.vn/fms/business/188352/rural-market-becoming-more-at-tractive-to-manufacturers.html

HCM City: Private sector needs most labourers


The demand for human resources in HCM City is forecast to rise 2-3 percent annually to reach 4.61 million labourers by 2020 and 5.34 million labourers by 2025, according to a report from the HCM Centre for Forecasting Manpower Needs and Labour Mar-ket Information.Private enterprises, especially small- and medium-sized enterprises, which play a ma-jor role in economic growth, have the highest demand. They are expected to require 1.87 million jobs this year or 66.9 percent of the city's total employment, the report showed.Private companies are expected to generate 2.06 million jobs by 2020 and 2.4 million jobs by 2025.Foreign direct investment (FDI) enterprises will need 776,000 labourers this year, ac-counting for 27.2 percent of the total employment, and 926,000 labourers by 2020 and 1.22 million by 2025.FDI enterprises play an important role in technology transfer and generate financial re-sources for infrastructure development.Employment demand in state-owned enterprises is expected to decline due to restruc-turing of state-owned enterprises and equitisation, from 196,000 labourers or 6.9 per-cent of the total demand this year to 183,000 by 2020 and 135,000 by 2025.While the service sector accounts for 67 percent of total recruitment demand, the in-dustry and construction sectors represent 31 percent and the agricultural sector 2 per-cent of demand.The labour market will require more highly skilled workers because of country's mem-bership in the Asean Economic Community (AEC) and signing of free trade agree-ments, as well as possible membership in the Trans-Pacific Partnership (TPP).In the 2017-2020 period, more than 300,000 people are expected to look for employ-ment in the city each year.There will be around 270,000 jobs available in the city each year in the same period, in-cluding 130,000 new jobs.https://en.vietnamplus.vn/hcm-city-private-sector-needs-most-labourers/119902.vnp

Tien Giang works to support enterprises


The Mekong Delta province of Tien Giang will actively provide legal support and dis-seminate legal regulations related to the investment law, business climate and labour in order to help local firms promote production and business in the remaining months of the year.According to Nguyen Thanh Liem, deputy head of the provincial Industrial Zones Management Board, the province will speed up administrative reforms and promptly remove difficulties facing businesses in investment attraction and production expan-sion.


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SVietnam finance & business 24 October 2017

The locality also has priority policies for companies investing in seafood processing for export and food processing for domestic consumption and export, he said.Local industrial zones (IZs) have lured 91 investment projects with total registered capital of nearly 3.7 billion USD and created jobs for more than 82,000 labourers.From the outset of the year, production value of businesses based in the IZs reached over 41.8 trillion VND (1.8 billion USD), a year-on-year increase of 17 percent. Their export revenue stood at over 1.5 billion USD, hiking 26 percent from the same time last year and the strongest growth so far.Tien Giang is currently home to four industrial zones, namely My Tho, Long Giang, Tan Huong and Soai Rap Oil and Gas Services.https://en.vietnamplus.vn/tien-giang-works-to-support-enterprises/119930.vnp

BUSINESSBusiness Briefs 24 October, 2017

24/OCT/2017 INTELLASIA |

* VietinBank has got approval from the State Securities Commission to issue VND4.2 trillion of 10-year unsecured inconvertible bonds. The debt has a face value ofVNDlO million. VietinBankwill sell the debt in two stages within this year.* The management of Coteccons Construction Company (CTD) said the total value of the firm's newly signed contracts amounted to VND21.3 trillion in Ianuary-September, which underpinned an end-September backlog ofVND25.6 trillion. The major con-tracts in the period included the second phase of Ho Tram Strip, the second phase of Diamond Island, Vinhomes Metropolis, the third phase of Gain Lucky Factory and Hoi An Casino. CTD has just held a groundbreaking ceremony of the Vinfast car and mo-torcycle manufacturing complex ofVingroup covering 332 hectares at the Dinh VuCat Hai Economic Zone in Hai Phong City.* Son Ha Saigon Company (SHA) has registered to issue 2.4 million more shares to pay a 2016 dividend with shareholders receiving 12 new shares for every 100 shares held. SHA has chosen October 30 as the record date for the additional share issue.* Vietnam Ventures Limited has bought 3.8 million shares of Khang Dien House Trad-ing and Investment Company (KDH) to increase its holding to 8.38%.* Japan's Sekisui Chemical Co Ltd has acquired over nine million shares ofTien Phong Plastic Company (NTP) to secure a 10.1 percent stake. Earlier this month, The Nawa-plastic Industries (Saraburi) Co Ltd, a member ofSCG Group, sold over 21 million shares, or nearly 24%, at NTP.* Ninh Binh Thermal Power Company (HNBP) said its net profit dropped 82.7 percent year-on-year to VND1.48 billion in the third quarter of this year due to lower gross profit. Its revenue rose 3.2 percent to over VND156 billion but its gross profit sank 54.8 percent to VND8.9 billion in the quarter. In the January-September period, BP earned a net profit of VND6.7 billion from its revenue ofVND476 billion, down 73.4 percent and 5.5 percent year-on-year respectively, said Viet Capital Securities Company.* Vo Van Thang, chair of Thuong Phu Coffee Company (CTP), has bought 500,000 CTP shares to raise his ownership from 5.9 percent to 10.9%.

Shares slide on profit-taking selling


Shares edged down on the two national stock exchanges on Monday, led by large caps which declined steeply under strong profit-taking selling pressure.The benchmark VN Index on the HCM Stock Exchange closed Monday down 0.82 per cent at 820.04 points. The southern market index decreased 0.25 per cent on Friday.On the Hanoi Stock Exchange, the HNX-Index gave up 1.76 per cent to end at 106.24 points. The northern market index lost 1.55 per cent in the last three sessions last week.The overall market condition was negative with 347 stocks falling, 123 rising and 241 remaining unchanged in the two markets.Large-cap stocks were the main drag as 24 of the top 30 largest stocks in terms of mar-ket value and liquidity on the HCM City exchange tumbled and just five advanced.Losers spanned from the finance and energy to the steelmaking, retail and pharmaceu-tical industries.All 10 listed banks on the two exchanges lost value, of which the Big Four (the four


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largest banks by market value and total assets) Vietcombank (VCB), Vietinbank (CTG), BIDV (BID) and Military Bank (MBB) decreased between 1.3-2.6 per cent.Securities and insurance companies were also among decliners. Big names that had a losing day include Bao Viet Holdings (BVH), Saigon Securities Inc (SSI), HCM Securi-ties (HCM), VNDirect Securities (VND) and Bao Viet Securities (BVS).Other companies that negatively affected the overall market outlook included PV Gas (GAS), Vietjet Air (VJC), Hoa Phat Group (HPG), Hoa Sen Group (HSG), Masan Group (MSN), Mobile Word Group (MWG) and Hau Giang Pharmaceutical (DHG).According to Bao Viet Securities Company (BVS), the growth of large caps was slowed by rising profit-taking selling pressure."Investors prefer strategy of 'buy the rumour and sell the news', following which they sold out many shares after these companies announced their third-quarter results," BVS's analysts wrote in a note.Among the few gainers on Monday, shares of FLC Faros Construction Corp (ROS) con-tinue to rise 6.7 per cent, lifting its rallying streak to 18 sessions in a row. ROS price has climbed 42.7 per cent in nearly one month, from VND105,700 a share late in September to nearly VND151,000 (US$6.65) a share on Monday.The market is losing momentum to rise and entering the value accumulation period, BVS analysts said, predicting the market will likely expand divergence when the earn-ing reporting season has gone one-third of the way.Liquidity improved with a total of 264 million shares worth nearly VND5.2 trillion ($229 million) being traded in the two markets, up 16.7 per cent in volume and 8.6 per cent in value compared to last week's average daily trading volume and value.http://bizhub.vn/markets/shares-slide-on-profit-taking-selling_289660.html

Market corrects downwards as blue chips lose steam


Shares closed in the negative zone on the two stock exchanges on Monday morning as large caps lost steam and weighed down the markets.On the HCM Stock Exchange, the VN Index was down 0.37 per cent at 823.78 points.On the Hanoi Stock Exchange, the HNX-Index declined 1.14 per cent to 106.91 points.Market breadth was negative as the number of losing stocks outnumbered gaining stocks by 286-123 on the two markets. Another 301 stocks remained unchanged.Blue chips led the downturn. As many as 25 of the top 30 largest stocks by market val-ue and liquidity on the HCM Stock Exchange tumbled and only three advanced.The three were brewer Sabeco (SAB), up 2.6 per cent; FLC Faros Construction (ROS), up 1.6 per cent; and Vietcombank (VCB), up 1.1 per cent.On the defensive side, the stocks impacting the market the most were Vietinbank (CTG), Petrolimex (PLX), PV Gas (GAS) and Vinamilk (VNM), as well as Hau Giang Pharmaceutical (DHG) and Masan Group (MSN).Market analysts predicted the market will soon experience a correction following a long rally over the past one month, particularly when large caps, driving the market's growth, were under profit-taking selling pressure.A total of 118.4 million shares worth almost VND2.5 trillion (US$109.7 million) were traded on the two markets in the morning.Afternoon trade starts at 1pm.http://bizhub.vn/markets/market-corrects-downwards-as-blue-chips-lose-steam_289653.html

SOE divestment seen obstructing cash flow into equities


Capital divestment and equitisation by State-owned enterprises (SOEs) may adversely affect cash flow into the stock market, said Bach An Vien, head of financial and macro analysis department of KIS Vietnam Securities Company.According to a government plan, around VND250 trillion could be raised from the re-structuring of SOEs in the 2016-2020 period. A mere VND15 trillion was mobilised in the first half of 2017, mainly thanks to the sale of a 5.4 percent stake worth VND11.2 trillion in in dairy firm Vinamilk.


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Speeding up SOEs equitisation is a necessary step to boost economic restructuring and the transparency of businesses. The plan will also spur the development of the stock market.In the short term, capital divestment and equitisation by SOEs will place pressure on cash flow into the stock market if domestic and foreign demand fails to improve. This will also result in an uneven distribution of cash among sectors, Vien said at an inter-view with vietstock.vn.Foreign investors are expected to be active players in SOEs' share issues in the near fu-ture. However, they, including financial and strategic investors, will focus on major firms with bright prospects, the expert said.Closing last week, the VN Index gained 0.72 percent at 826.84 points while the HNX-Index dipped 0.89 percent at 108.14 points. Turnover improved on both bourses, with matching volume averaging out at 162.8 million shares per session on the HCM City market and 46.8 million shares on the Hanoi exchange, up 15 percent and 11.2 percent versus a week earlier respectively.Large-cap stocks continued making positive contributions to the VN Index. But bad signs emerged, such as poor transactions of most small and medium stocks and signif-icant selling at a high VN Index, around 830 points.These factors led to investor caution, hence low turnover on Wednesday and Thurs-day. Key stocks such as construction enterprise ROS, national gas group GAS and elec-tronic store operator MWG helped keep the main index from a strong decline.Last Friday, profit takers took the upper hand as the VN Index failed to beat the 830-point level again. Although ROS rose to its upper limit for the third consecutive ses-sion, the market still dropped as losers far outnumbered gainers by 292 to 155.Some speculative stocks attracted cash flow, supported by good business results in the third quarter, but they also fell on Friday due to poor index developments.Foreign investors net sold over VND86.8 billion on the southern bourse. On the north-ern market, if put-through deals of plastic firm NTP were excluded, they net sold over VND28 billion.http://english.thesaigontimes.vn/56703/SOE-divestment-seen-obstructing-cash-flow-into-equities.html

VFM funds report solid results


Vietfund Management said that the size of its ETF VFMVN30 has topped VND1 tril-lion (US$43.8 million) after jumping by 138 per cent this year.It said the fund's return of 28 per cent is the highest even surpasses any other open-ended funds in Vietnam.ETF VFMVN30, a domestic exchange-traded fund incorporated in the country and launched in 2014, has attracted many foreign investors.It aims to replicate the performance of the VN30 Index as closely as possible.VFM also reported that its VF1, a balance open end fund, now has a total asset value of over VND787 billion ($34.5 million) and made a return of 21.55 per cent this year.In the last five years, VF1 achieved average returns of 16.8 per cent a year, the company said.VF4, another open end fund investing fully in blue-chip stocks, has total assets of VND511 billion ($22.4 million) value and a return of nearly 24 per cent after 9 months this year and 18 per cent in the last five years.VFB, an open end fund investing in bonds, has assets of VND223 billion ($9.7 million) and reported returns of 13.4 per cent.VFM, is the first domestic fund management company in Vit Nam, was founded in 2003.http://bizhub.vn/markets/vfm-funds-report-solid-results_289655.html

TAC to reach 2017 target for pre-tax profits


Cooking oil manufacturer Tuong An Vegetable Oil Joint-Stock Company (TAC) is ex-pected to reach its target of pre-tax profits of VND165 billion (US47.2 million) this year,


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according to the company.The company said that in the first three quarters of the year, it had reached a pre-tax profit of over VND107 billion ($4.7 million), up by nearly 50 per cent over the same pe-riod last year.TAC reported that revenue in this period increased by 6 per cent year-on-year to VND3 trillion.During the first nine months, the company spent a great deal to expand their distribu-tion system as well as develop human resources.TAC attributed such investments to its plan to put a foothold in the high-end segment and to develop more products in the fourth quarter.From now to the end of this year, the company predicts that its revenue will strongly increase thanks to high demand during the end of the year season. Many new products will also be brought to the market.Established in 1977, the company is now one of the biggest cooking oil manufacturers in the country. Last November, the company was acquired by Kido Group.http://bizhub.vn/markets/tac-to-reach-2017-target-for-pre-tax-profits_289651.html

Tien Phong Plastic plans to lift foreign ownership cap


Tien Phong Plastic Joint Stock Company (Tien Phong Plastic) may allow total foreign ownership of its capital instead of the current 49 percent.The final decision will be made at the company's extraordinary shareholders meeting, scheduled for November 30. The management board will need to obtain approval of 65 percent of shareholders for the change.The plan came after the company announced the Thai plastic producer Nawaplastic Industries (Saraburi) Co Ltd offloaded its 21.27 million shares or 23.84 percent owner-ship in the Vietnamese plastic firm on the stock market (traded under the code NTP) between September 25 and October 12.Tien Phong Plastic is trading its 89.2 million shares on the Hanoi Stock Exchange for 69,000 VND (3.06 USD) to 71,900 VND per share during the September 25-October 12 period.That means the Thai-based plastic producer sold its share for 1.46 trillion VND (rough-ly 65 million USD), triple its initial investment in 2012.The State Capital Investment Corporation (SCIC), which represents the government to monitor the State's capital in Tien Phong Plastic, remains the biggest shareholder with a 37.1 percent stake.During the 14-trading-day period, there were many put-through trading transactions for Tien Phong Plastic's shares with volume ranging from one to nine million and share price varying between 69,300 VND to 71,800 VND per share.The identity of the largest buyer has remained confidential, however, it is believed that a foreign investor is buying up the shares.NTP closed on October 19 at 73,000 VND per share, having increased by a quarter since its one-year low of 57,600 VND per share in early March.During the five-year investment period, Saraburi received around 173 billion VND worth of dividend payouts from the Vietnamese firm. After Saraburi completed with-drawing from Tien Phong Plastic, the two representatives of the Thai company on Oc-tober 17 asked for the resignation of the Vietnamese firm's management and supervisory boards.Tien Phong Plastic will also discuss the restructuring of the firm's management and su-pervisory boards at the upcoming shareholder meeting. The company also plans to make a 15 percent advance dividend payout for 2017 performance on November 29.In the third quarter of 2017, Tien Phong Plastic recorded nearly 161 billion VND in its pre-tax profit, a yearly increase of 83.3 percent.In nine months, the company earned total 363 billion VND in pre-tax profit, an annual rise of 27.6 percent.https://en.vietnamplus.vn/tien-phong-plastic-plans-to-lift-foreign-ownership-cap/119947.vnp


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HCM City says will trace pork origin more stringently


The HCM City government has asked the Department of Industry and Trade to carry out the second stage of the pork management, identification and traceability scheme early next year which makes it possible to trace pork products back to farms, slaugh-terhouses and distributors.City vice chair Tran Vinh Tuyen issued an official letter last week ordering relevant de-partments and agencies to strengthen State management of the farming, slaughter, transport and trading of pigs and pork products.Phase one of the scheme which has been carried out since last December focuses on farming and distribution stages. The second phase is set to trace the origin of pork products in a more stringent manner.Tuyen told the HCM City Department of Agriculture and Rural Development to team up with relevant departments and agencies to strengthen inspections over the slaugh-ter and hygiene of pigs. Pigs must be processed at accredited slaughterhouses.They should carry out regular and snap inspections of pig farms and slaughterhouses which are suspected of failing to meet the standards.The departments of industry-trade and justice, and relevant agencies are tasked with crafting rules for wholesale markets to create a legal framework for quality manage-ment and traceability of pork products and other commodities.Earlier, the management boards of Hoc Mon and Binh Dien wholesale markets gave pork traders a few more days to fully adhere to the traceability standards set by the city government, which came into force early last week. But traders said they needed more time to meet the standards.http://english.thesaigontimes.vn/56696/HCM City-says-will-trace-pork-origin-more-stringently.html

Nam Dinh, Thai Binh develop disease-free pig production for export


The Department of Animal Health under the Ministry of Agriculture and Rural Devel-opment is implementing a project to build safe and disease-free pig breeding region meeting requirements for export in the northern provinces of Nam Dinh and Thai Binh.The project, which is conducted from 2015-2020, is part of Decision 441/QD-BNN-TY on sustainable development of the breeding sector with international standards for ex-port.By September 2017, the project helped develop 22 concentrated pig breeding farms in Thai Binh and 23 others in Nam Dinh, with 11 farms in Thai Binh and six others in Nam Dinh recognised as chlorella-free farms.Thai Binh has 26 farms linking with four enterprises and one breeding association and 11 cooperatives in its production chain, while Nam Dinh has also set up some similar chains.Statistics on April 1, 2017 showed that Thai Binh has 1 million pigs bred in 546 farms, while Nam Dinh has nearly 780,000 pigs with 30 large-scale farms.https://en.vietnamplus.vn/nam-dinh-thai-binh-develop-diseasefree-pig-production-for-export/119905.vnp

Concern over quality threatens export of Vietnamese pork

24/OCT/2017 INTELLASIA| TUOITRE NEWS

Improvements in the quality of Vietnamese pork are crucial if the country's vision of becoming a major exporter of the meat is to be realised, experts said at a forum in Ha-noi last week.The forum, held on Friday by the Ministry of Agriculture and Rural Development, sought solutions to Vietnam's flagging pork export industry.Vietnam's total pork production in 2017 is forecast at around 2.75 million metric tonnes, ranking it sixth in the world behind China, the European Union (EU), the US, Brazil and Russia.However, Vietnam exports a mere 20,000 tonnes on average per year, or less than 0.73 percent of its total production, despite growing global demand.


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China currently imports nearly 2.2 million tonnes of pork per year, Japan 1.36 million tonnes and the Philippines 195,000 tonnes, according to experts attending Friday's fo-rum.Vietnam's low transport and labour costs, coupled with the implementation of new technologies, have enabled the country to produce pork at a more competitive price than its competitors.However, concerns over the quality and safety of Vietnamese pork have stopped im-porters from opening up their markets.Earlier this month, thousands of pigs were found to have been injected with sedatives shortly before slaughter at HCM City's largest slaughterhouse.Though all of the sedated pigs have since been scheduled for incineration, the scandal shook the public's perception of the popular meat.Lee Jong-beom, deputy general director of South Korean Daewon Machinery Co., Ltd, stressed the importance of food safety and hygiene for aspiring exporters like Viet-nam.South Korea imported $5.8 billion worth of pork in 2016, Lee said, though most came from trusted sources like the US, Germany and Spain.Vu Manh Hung, general director of Hung Nhon Group, said that most of his foreign partners had asked for their pork imports to be of traceable origin and risk-managea-ble before signing any contracts.This poses an immediate challenge for local producers, who have become used to sell-ing their pork without providing any information regarding its origin, Hung said.The latest effort by HCM City officials to impose a ban on so-called 'homeless' pork pork without tracking tags that provide a history of its journey from farm to slaugh-terhouse to market stalls was met with widespread criticism by local merchants.According to Nguyen Xuan Cuong, the minister of Agriculture and Rural Develop-ment, the value of Vietnam's pork industry is higher than rice, but export revenues paint a totally opposite picture."Businesses have begun," Cuong said, "but the remaining task is for the authorities to promote trade and open up foreign markets."https://tuoitrenews.vn/news/business/20171023/concern-over-quality-threatens-ex-port-of-vietnamese-pork/42208.html

VIETRADE supporting brands in entering Korea

24/OCT/2017 INTELLASIA| VN ECONOMIC TIMES

Vietnam Trade Promotion Agency holds conference within framework of National Branding Programme to help local businesses gain traction in South Korea.The Vietnam Trade Promotion Agency (VIETRADE) under the Ministry of Industry and Trade organised a conference on October 12 in Hanoi on "Promoting the Develop-ment of Vietnamese Brands in the South Korean Market", within the framework of the National Branding Programme to support businesses in approaching the country. Do Kim Lang, deputy director general of VIETRADE and deputy Secretary general of the National Branding Programme, told the conference that the strengthening of stra-tegic cooperation between Vietnam and South Korea has always been a priority of the two governments.South Korea is currently the largest investor and trading partner of Vietnam, while Vi-etnam is South Korea's third largest trading partner after the US and China. South Ko-rea is a market of potential and it shares many similarities with Vietnam in terms of culture and business. Lang emphasized that the National Branding Programme is the only national brand development programme approved by the prime minister and recognised under the Foreign Trade Administration Act. It is a great opportunity for enterprises who are "national brands" because it also helps increase their prestige in foreign markets.In order to build a brand in South Korean, Vietnamese enterprises should actively par-ticipate in the country's value chains through distribution channels such as Lotte Mart, 7-Eleven, and E-mart, according to Le An Hai, deputy director of the Pacific Market Department under MoIT.


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They also need to address issues such as product positioning, packaging design, and target markets, while also focusing on the domestic market. All of this would help companies ensure distribution systems and develop their brand in foreign markets.A number of Vietnamese brands are already in South Korea, such as Trung Nguyen's G7 coffee, which appears on the shelves of large supermarkets. Others, such as Pho Xua Va Nay noodles, Trung Thanh chili sauce, and Nam Ngu fish sauce are sold via informal distribution systems. "There are products from Vietnam but foreign brands are being sold and are preferred in South Korea," Hai said.For his part, Yoon Sang Ho, President of the Korea Federation of Small and Medium Business Associations, said that South Korean customers prefer to choose brands they are familiar with, so building a durable brand is important. "Enterprises should study the habits of South Korean consumers," he advised. "New Vietnamese brands have al-ready made a mark on shopping habits."The conference attracted a great deal of attention from organisations and enterprises and contributed to increasing export opportunities for Vietnamese enterprises and promoting brand names in particular and national brands in general to the South Ko-rean market.http://vneconomictimes.com/article/business/vietrade-supporting-brands-in-enter-ing-south-korea

Association enhances Vietnam-Japan economic links

24/OCT/2017 INTELLASIA| VOV

The Hokuriku-Vietnam association of investment promotion businesses was set up on October 20 in Kanagawa City, Japan, aiming to cultivate investment opportunities for businesses and develop economic ties between the two countries through human re-sources and economic exchanges.Members of the association include representatives from regional Japan External Trade Organisation (JETRO) offices, the Hokuriku Economic Federation, Kanagawa University, some regional parliamentarians serving as stint as advisers, and Japanese businesses which are operating or keen to invest in Vietnam.President of the Mitani Corporation is serving as the President of the Association, and Tran Duc Binh, Vietnamese Consult general to Osaka is an honorable member and ad-viser.To achieve its goals, the Association will carry out a series of programmes designed to encourage and support Kokuriku businesses investing and operating in Vietnam. The programmes will regulate and receive economic and trade exchanges, assist Vietnam's human resource training, and recruit Vietnamese students and trainees.In the immediate future, a business delegation from the Association will make a fact-finding tour of Vietnam to seek investment opportunities in mid-2018.Hokuriku region comprises three prefectures of Fukui, Ishikawa, and Toyama. It is home to many leading technological, mechanical, manufacturing, garment, IT, and ag-ricultural processing and production businesses, alongside some big universities and research institutes.Around 72 businesses from Hokuriku are operating in Vietnam at present.At the event, the Association held a Vietnam-Japan economic exchange conference with the participation of Vietnamese officials who are trainees of a leadership training programme in Japan. Also in attendance were more than 100 Japanese businesses in banking, agriculture, and manufacturing, and representatives from research institutes and universities in Hokuriku.http://english.vov.vn/economy/association-enhances-vietnamjapan-economic-links-360890.vov

LCD tax loophole found, with big losses


Local customs departments will have to tighten their inspection of LCD product codes to avoid tax losses, as electronics firms have recently been tagged with tax arrears of VND481.68 billion ($21.89 million) due to incorrect declarations of tax codes.Phan Minh Le, deputy director of the HCM City Customs Department, noted in a re-


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cent report to Vietnam Customs, "After post-clearance checks, firms admitted that the adjustment of the HS code of LCD products is right." An HS code classifies a traded product according to an internationally-standardised system.Under the intended tariff rate, firms would have had to pay a 3 per cent import tax in-stead of 0 per cent.According to the report, firms imported these LCD-coded products valued at VND16,056 billion ($729.8 million).Panasonic AVC Vietnam is reported to have 891 customs declaration numbers that snuck through with a 0 per cent tax, valued at nearly VND1.956 trillion ($88.9 million) for their imported products.LCD stands for liquid crystal display a flat-panel display or other electronically-mod-ulated optical device that uses the light-modulating properties of liquid crystals. LCDs are used in a wide range of applications including computer monitors, televisions, in-strument panels, aircraft cockpit displays, and indoor and outdoor signage.The misattributions were discovered in a review of information on the customs data system. HS codes that should have fallen under LCD product numbers were instead attributed to the categories of TV panels, LCD panels for producing LED screens, back-lighting, and liquid crystal display all of which have import tax rates of 0 per cent.According to the HCM City Customs Department, citing a guideline by the general Department of Vietnam Customs, some of these product types are listed in a 3 per cent tax category.However, firms complained that the guideline had only been circulated internally within customs agencies and not made known to the public.In 2016, the Ministry of Finance issued a judgement saying that Panasonic's LCD back-lighting belongs to HS code 8529.90.91, and import taxes must be imposed at a 3 per cent rate.The HCM City Customs Department said, "The tax arrears are large VND481.68 billion ($21.89 million), so we must consider the appropriate means of collection."According to its website, Panasonic AVC Networks Vietnam Co., Ltd was founded in 1996 as a joint venture. As from August 1 2014, the company was transformed to a 100 per cent foreign invested company. The company manufactures and sells a wide range of televisions and other audio-visual devices with premium Japanese quality and tech-nology.Panasonic AVC Networks Vietnam Co., Ltd is one of six Panasonic companies operat-ing in Vietnam.http://www.vir.com.vn/lcd-tax-loophole-found-with-big-losses.html

ITST proposes monorail lines to airport in HCM City


The Institute of Transport Science and Technology (ITST) has asked the HCM City De-partment of Transport to consider building two monorail lines to Tan Son Nhat Inter-national Airport to cope with severe traffic congestion around the airport, heard a meeting late last week.According to ITST's plan, one elevated monorail line would traverse between Gia Dinh Park in Go Vap District and the nation's busiest airport via Pham Van Dong Street. The other line would connect Hoang Van Thu Park in Tan Binh District and the airport, and run in parallel with Truong Son Street which is often congested at rush hour.The terminals would be located at the two parks. ITST proposed building an under-ground parking lot for 2,000 cars, and an operation and maintenance centre at Gia Dinh Park.The single-track monorail lines would require an estimated VND4,425 billion to VND4,725 billion, or $35 million per kilometer. If the double-track lines are chosen, the cost would rise to VND6,160 billion to VND7,040 billion, or $50 million per kilometer.It would take 18 months to complete the two lines.Ha Ngoc Truong from the HCM City Association of Bridge, Road and Port said ITST's proposal is costly and infeasible. Other options should be weighed, he said.Dr Pham Xuan Mai, an expert in traffic engineering, said if the terminals are located at


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Hoang Van Thu and Gia Dinh parks, areas around the parks would face traffic jams.Traffic on the roads leading to Tan Son Nhat International Airport is heavy as a lot of non-air passengers often choose the streets near the airport to move between districts at rush hour. He suggested other measures such as opening more entrances to the air-port on Hoang Hoa Tham Street, and building overpasses and cableways.Bui Xuan Cuong, director of the HCM City Department of Transport, said the depart-ment would look into ITST's proposal and others.HCM City also considers building a 2-kilometer metro line from Lang Cha Ca station to Tan Son Nhat International Airport.http://english.thesaigontimes.vn/56691/ITST-proposes-monorail-lines-to-airport-in-HCM City.html

HCM City to set up $189 million science, technology park

24/OCT/2017 INTELLASIA| SGGP NEWS

HCM City is making efforts to establish a 200 hectare science and technology park with the total capital of VND4.3 trillion (US$189 million), said chair of the city People's Committee Nguyen Thanh Phong yesterday.He was speaking at the 21st annual conference of Asian Science Park Association (AS-PA) opened in HCM City, gathering over 400 delegates from nations and territories such as Japan, South Korea, Iran, Turkey, the US, Russia, Singapore, Malaysia and Tai-wan.According to Phong, the park establishment aims to attract investment in grey matter sector. That will study and apply advanced technologies to create eco-friendly technol-ogy, information technology, renewable energy and space technology products.The park will be a foundation for the city's economic development basing on science and technology and innovation.He called on businesses to continue expanding investment in the city and committed to always siding with them and consistently implementing assistance polices.In addition, the city will continue improving investment environment, building e-gov-ernment and smart city; solve administrative reform congestion; make auction and bidding the main method to distribute resources in the city.HCM City has determined to create breakthroughs in economic development, science and technology.In the phase of 2011-2015, the science and technology field grew 16.9 percent, the high-est in nine major service sectors. Contribution of total factor productivity (TFP) to eco-nomic growth reached 33.1 percent, higher than the country's average of 29 percent, with science and technology accounting for over 70 percent.so far, HCM City has attracted 130 hi-tech projects with the total capital of $6.8 billion. Tech products' added value averages $6.8 billion. The hi-tech field is expected to con-tribute 10 percent of the city's gross regional domestic product by 2020.http://www.vir.com.vn/hcmc-to-set-up-189 million-science-technology-park.html

Global IT firms should found VN legal entities: VTC


Global IT platforms such as Google and Facebook should be required to establish legal entities in Vietnam in charge of conforming to the country's laws, a representative of VTC Mobile has proposed.Nguyen Ngoc Bao, director of VTC Mobile, a Vietnamese mobile game publishing company, was quoted by ictnews.vn as saying this would help ensure fair competition between local and foreign companies.Bao said that borderless service platforms such as Facebook, YouTube, Google and Netflix are providing content services for Vietnamese users, such as online advertis-ing, games and films, with users making payments via credit cards or intermediary payment apps.This makes it difficult to manage borderless service platforms without legal entities in Vietnam.Under Decree 72/2013/ND-CP, about the management, provision, use of internet serv-ices and information content online, both domestic and foreign firms are required to


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follow the country's regulations.Bao said that it was essential to require global IT firms to establish legal entities in Vi-etnam to better manage their operations in Vietnam amidst rapid technology develop-ment which enables borderless services provision. Payments should also be integrated into Vietnamese payment channels, he said.From the beginning of this year, Google and Apple stopped accepting payments through local channels, such as mobile cards, for purchasing digital content on the Google Play Store and Apple Store.Instead, only payments through their own payment gateways were accepted and pro-viders would receive payment only when customers' transactions were completed and the payment had been processed.According to Luu Vu Hai, chair of VTC, the payment policies of Google and Apple cre-ate difficulties for local digital content companies, including game publishing compa-nies.Previously, Hai proposed the Ministry of Information and Communications raise pol-icies to tackle this problem early to ensure healthy competition.http://bizhub.vn/tech/global-it-firms-should-found-vn-legal-entities-vtc_289663.html

Nearly VND5bn of smuggled goods destroyed in Lang Son

24/OCT/2017 INTELLASIA| DTI NEWS

The Market Surveillance Department of Lang Son Province has destroyed nearly VND5bn (USD220,000) worth of smuggled and banned goods seized in the area since early 2016.There are thousands of products including fake, smuggled, banned goods including cosmetics, footwear, clothes and batteries.Some are crushed, burnt and finally buried at Tan Lang dumping site in Van Lang Dis-trict.Last year, Market Surveillance Department of Lang Son destroyed fake goods worth VND400m (USD17,600). Asides from cosmetics, footwear, clothes products, they also found hundreds of fake Rang Dong light bulbs and food of unknown origin.http://dtinews.vn/en/news/017004/53435/nearly-vnd5bn-of-smuggled-goods-de-stroyed-in-lang-son.html

PV Oil ready to roll out E5 bio-fuel nationwide


PetroVietnam Oil Corporation (PV Oil) is willing to switch from RON A92 petrol to bio-fuel E5 on nationwide from January 1, 2018, according to newswire Cafef.PV Oil has completed the close loop including processing raw material for bio-fuel blending, blending E5 bio-fuel, and transporting E5 bio-fuel from blending stations to transit warehouses, and then to retail stations and distributors nationwide.PV Oil was considered the pioneer piloting the E5 use programme and officially start-ed retail distribution from August 1, 2010. Since December 1, 2014 E5 bio-fuel was tak-en into popular use through PV Oil's distribution systems in seven cities and provinces, including Hanoi, HCM City, Hai Phong, Danang, Can Tho, Quang Ngai, and Ba Ria-Vung Tau.PV Oil upgraded the storage tanks systems and simultaneously took 11 bio-fuel blend-ing stations into operation nationwide, a number that will increase by December this year to ensure the nationwide commercial distribution of E5 bio-fuel.Besides, the company built plans for processing ethanol E100 to ensure the raw mate-rial for E5 bio-fuel blending, which is a mix of 95 per cent A92 petrol and 5 per cent ethanol E100. PV Oil will source all ethanol E100 domestically.PV Oil has also accelerated the switch fuel pumping facilities from RON A92 petrol to bio-fuel E5 at retail stations and is ready to provide technical support to its agencies and distributors. It plans to complete upgrading and switching processes by the end of the year.Previously, the Ministry of Industry and Trade (MoIT) and other authorities as well as cities and provinces also announced accelerating the implementation of solutions to switch from RON A92 petrol to E5 bio-fuel.


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According to calculations by MoIT, from the beginning of 2018 -- when RON A92 pet-rol disappears -- the country will need about 5.5 million cubic metres of E5 fuel. This means producing 250,000-270,000 tonnes of ethanol E100 as raw material for bio-fuel blending.MoIT forecasts that the domestic supply of E100 will reach about 520,000 cubic metres per year, adequate to meet the demand for the blending of the new environmentally friendlier E5 fuel.In order to ensure the supply of E5 bio-fuel for users, MoIT organised working sessions with bio ethanol manufacturers and Binh Son Refining and Petrochemical Company Limited to urge them to complete the facilities and infrastructure to process ethanol E100.According to MoIT's calculations, the domestic ethanol E5 source is currently enough to meet the demand for E5 bio-fuel blending, once it replaces RON 92 from January 1, 2018.Notably, to date, Vietnam has four ethanol E100 processing factories manufactured by Tung Lam Co., Ltd with a total annual capacity of 200 million litres of ethanol, which is enough to blend of 3.9 million cubic metres of E5 bio-fuel.The Dung Quat and Binh Phuoc bio-ethanol factories, which have suspended their op-erations, will be restarted by the end of the year.Besides, MoIT worked with 26 large-scale petroleum trading units to listen to their dif-ficulties and obstacles during the preparation process for trading E5 bio-fuel in early 2018.Vietnam currently has five petroleum trading firms with E5 bio-fuel blending stations, namely Petrolimex, PV Oil, Saigon Petro Co., Ltd, Military Petroleum Corporation (MIPECORP), and Nam Song Hau Trading and Investment Petroleum JSC.http://www.vir.com.vn/pv-oil-ready-to-roll-out-e5-bio-fuel-nationwide.html

Operator to sell 5-6pct of Vietnam's sole refinery

24/OCT/2017 INTELLASIA| TUOITRE NEWS

Dung Quat Oil Refinery is valued at $3.2 billionBinh Son Refining and Petrochemical Co. Ltd (BSR), the operator of Dung Quat Oil Re-finery, plans to put a proportion of its shares in the facility for sale in an IPO to be an-nounced later this year.Situated in the central province of Quang Ngai, Dung Quat, the only functioning oil refinery in Vietnam, is valued at $3.2 billion.Following a recent meeting with deputy prime minister Trinh Dinh Dung, BSR is cur-rently inviting investors to purchase five to six percent of the facility during an upcom-ing initial public offering, set to go ahead in the last quarter of this year, according to company leaders.Vietnam's largest fuel wholesaler Petrolimex revealed in August that it planned to be-come a strategic shareholder of Dung Quat.Developed by oil and gas giant PetroVietnam, Dung Quat is operating well, even ex-ceeding its design production capacity by six to eight percent, said BSR general man-ager Tran Ngoc Nguyen.In the first nine months of this year, the facility churned out 4.4 million metric tonnes of products, 4.3 million tonnes of which have been consumed, with revenue of VND55 trillion ($2.42 billion).In doing so, the refinery has contributed more than VND6.5 trillion ($286.34 million) to the state budget, already meeting 91 percent of its full-year target.Dung Quat boasts a return on equity ratio of 16.09 percent, and a return on sales of 9.94 percent.BSR is also undertaking a project to expand the facility, expected to be completed by March 2022.https://tuoitrenews.vn/news/business/20171023/operator-to-sell-56-percent-of-viet-nams-sole-refinery/42213.html


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Vietnam's airport ground services firm honoured by Korean Air


The Vietnam Airport Ground Services Co. Ltd (VIAGS), a subsidiary of Vietnam Air-lines, has been recognised as a provider of the best cargo handling service with the ab-solute score of 50/50 by Korean Air.Vietnam Airlines said Korean Air assesses the service quality of ground services com-panies by basing on seven major criteria, from security and safety ensuring, support resources, equipment maintenance to cargo transportation, training, services improve-ment and unexpected incident response.Aside from the Korean Air recognition, VIAGS recently won eight service quality awards presented by famous carriers such as Singapore Airlines, Malaysia Airlines and Cathay Pacific.In the first nine months of 2017, VIAGS served nearly 93,000 flights with over 28 mil-lion passengers, up 5 percent and 11 percent from the same period last year. It also handled about 800,000 tonnes of cargo, rising by almost 1.3 times year-on-year.VIAGS was founded on January 1, 2016 basing on the merger of three ground services firms which are now its subsidiaries at Noi Bai, Tan Son Nhat and Da Nang interna-tional airports.https://en.vietnamplus.vn/vietnams-airport-ground-services-firm-honoured-by-kore-an-air/119938.vnp

Inspection finds grave mismanagement at ACV


Airports Corporation of Vietnam (ACV), the sole airport company managing the 22 airports across the country, has recently been found to have committed several viola-tions relating to the enforcement of regulations as well as capital and land use.These inspection results were published by the government Inspectorate of Vietnam after taking a closer look at ACV's operations in the 2012-2015 period.The date that the government Inspectorate of Vietnam announced starting the inspec-tion (April 2016) is identical to the date that ACV started its operation under the equi-tised company model.No competitive biddingAccording to the inspection conclusions, during 2012-2015, ACV did not have a uni-form process to select goods and service providers at its airports. Notably, instead of conducting a bidding to select companies to sell goods and services inside the airports, ACV was found to voluntarily appoint companies and individuals to hire space for business activities.Despite the fact that the government Inspectorate of Vietnam has yet to clarify the con-sequences of ACV's voluntary appointment of goods and services providers, it is sure that selecting partners via bidding will create more benefits.Besides, ACV was found to have committed violations in collecting service fees. Nota-bly, at the time of inspection, 21 of 22 airports managed by ACV asked car drivers to pay entrance fees at the terminals.Accordingly, car drivers were required to pay between VND7,000-13,000 ($0.31-0.57) for a daily ticket and between VND600,000-1.65 million ($26.42-72.64) for a monthly ticket for stopping, even for short durations of three-five minutes only at the paths for picking up or dropping off passengers. Between January 1, 2012 and December 31, 2015, ACV earned a total of VND551 billion ($24.3 million) from collecting entrance fees.Lax management of land areasAt the inspected time, ACV was managing 3,102 hectares of land, 3,085 hectares of which are land inside the airport areas and the remaining 17 hectares were located out-side of the airports. However, ACV was found to have delayed completing procedures to lease more than 200 hectares of land.Along with delaying the land lease procedure, ACV's lack of the land lease processes before transforming into an equitised company was another violation.Furthermore, ACV committed violations in using allocated land plots for improper purposes. Notably, ACV allowed enterprises to conduct unrelated activities on several


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land plots allocated for aviation-related purposes.Earlier in July 2017, the Inspectorate of the Ministry of Transport issued the inspection results of ACV's service quality at its five key airports. Accordingly, ACV lacked suf-ficient management oversight at its spaces for lease.At the inspected time period, numerous goods and services providers used larger spaces than what was specified in the contracts for their business activities. Besides, ACV's permitting enterprises to use area allocated for opening customer supporting centres for business activities was another sign of mismanagement.In early August, the Inspectorate of the Ministry of Transport (MoT) announced start-ing an inspection on the capital efficiency of construction investments managed by ACV.Accordingly, the inspection team will examine ACV's performance on raising and managing capital for construction investment, including capital from the national budget and loans managed by MoT and ACV.http://www.vir.com.vn/inspection-finds-grave-mismanagement-at-acv.html

HAAN begins work on new wood processing factory


HAAN Group on October 20 started construction on a new wood processing factory in Tan Duc Industrial Park, Long An Province, which borders HCM City.Located next to the firm's operational Ha An Long An 1 facility, Ha An Long An 2 fac-tory will be up and running in late April 2018.With a total investment of VND100 billion (US$4.4 million), the forthcoming factory will be capable of turning out 80 container loads of interior wooden goods a month.Around 15 percent of the company's products manufactured at Ha An Long An 1 fac-tory are exported to Europe, the Americas, the Middle East, Australia and Bhutan. HAAN Group expects 40 percent of its products will be exported when Ha An Long An 2 is put into operation.Doan Mai Tuyen, chair of HAAN, said the firm's products meet export standards like Social Audit, Factory Audit, and FSC & COC.HAAN specialises in designing, manufacturing and distributing interior wooden products and construction materials for hotel, resort and housing projects. The compa-ny looks to make VND300 billion in revenue this year.http://english.thesaigontimes.vn/56701/HAAN-begins-work-on-new-wood-process-ing-factory.html

Ground broken for 16 million USD candy factory in Nghe An


Construction of a 360 million VND (16 million USD) confectionery factory began in the central province of Nghe An on October 21.The ground-breaking ceremony for the Hai Chai 2 factory in the Dong Hoi Industrial Zone was witnessed by deputy prime minister Vuong Dinh Hue, baocongth-uong.com.vn reported.Invested by Hai Chau Confectionery JSC, the factory will have 10 production lines, providing 75,000 tonnes of products each year. It is expected to earn annual revenue of 1.7 trillion VND (74 million USD).Speaking at the ceremony, Chair of the provincial People's Committee Nguyen Xuan Duong vowed to facilitate the operation of the factory, which is regarded as the com-pany's key project in the north central region.According to the Business Monitor International (BMI), the nation's confectionery sec-tor has experienced a relatively high and stable growth rate and is forecast to earn 40 trillion VND (1.8 billion USD) in revenues in 2018.https://en.vietnamplus.vn/ground-broken-for-16 million-usd-candy-factory-in-nghe-an/119933.vnp

Float glass plant opens in Ninh Binh


A float glass manufacturing plant started operation last week in the northern province of Ninh Binh's Khanh Cu Industrial Zone.


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Financed by INDEVCO Joint Stock Company, the plant provides 80 million metres of glass annually to meeting the increasing demand of domestic and international mar-kets.The plant, which can utilise the province's available source of limestone materials, is expected to create 1,000 local jobs.Chiarman of the provincial People's Committee Dinh Van Dien said he appreciates the efforts by local authorities and the investor to speed up the factory's construction.At the opening ceremony, the chair said Ninh Binh has always created favourable con-ditions for businesses and investors in the locality.The province is now home to 6,000 enterprises and strives to raise the figure to over 10,000 by 2020.https://en.vietnamplus.vn/float-glass-plant-opens-in-ninh-binh/119932.vnp

CapitaLand ranks 68th among top 100 in Forbes' Top Regarded Companies


CapitaLand, a leading real estate company, is one of the only two Singapore compa-nies making it to the top 100 in the Forbes' 2017 Global 2000: Top Regarded Companies list.Based on Forbes' 2017 Global 2000 rankings, the list features the world's biggest public companies from 58 countries that together generated $35.3 trillion in revenue. For the Top Regarded Companies list, Forbes partnered with Statista, who asked 15,000 re-spondents from 60 countries to give their opinions on the Global 2000 companies. The companies were evaluated based on trustworthiness/honesty, social conduct, the com-pany as an employer and the performance of the company's product or service.Lim Ming Yan, President and CEO of CapitaLand Limited, said CapitaLand is the top real estate company and one of the only two Singapore companies to make it to the top 100 in the Forbes' Global 2000: Top Regarded Companies list.This accolade attests to not just the financial success of the Group. It underscores the strength of the CapitaLand brand as a trustworthy and attractive employer, business partner, product and service provider, and sustainable global citizen across our real es-tate portfolio spanning more than 150 cities and in over 30 countries."As we continue to proactively engage our stakeholders through transparent commu-nications while growing and investing in the future sustainably, we are committed to deliver quality real estate products and services that enrich people and build commu-nities globally," Lim said.http://english.thesaigontimes.vn/56689/CapitaLand-ranks-68th-among-top-100-in-Forbes%E2%80%99-Top-Regarded-Companies.html

Nghi Son economic zone to welcome ecological resort


The People's Committee in the central province of Thanh Hoa has recently given the go-ahead to a $15.6 million eco-tourist resort project in the Nghi Son economic zone in Tinh Gia District.The project is jointly invested by Phu Thinh Phat general Trading Joint Stock Company and Tecco Investment Corporation Joint Stock Company. Some 62 per cent of the project's investment capital comes from equity and the rest is sourced from bank loans.Spanning an area of 28.9ha, the project will include a 6,000sq.m three-star hotel, a 16,400sq.m condominium complex, a 5,000sq.m restaurant, a 4,500sq.m spa, a 3,000sq.m swimming pool and several other facilities.Construction of the resort is divided into two phases, expected to be completed and put into operation in the fourth quarter of 2020.With the project, the investors aim at building an eco-tourism resort for tourists, diver-sifying the province's tourism services and promoting cultural exchange.http://bizhub.vn/news/nghi-son-economic-zone-to-welcome-ecological-resort_289657.html


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Fusion Maia Da Nang selected as top-20 hotel-spas in world


Fusion Maia Resort Da Nang has been selected as one of the top 20 hotel spas in the world in the Readers Choice Awards in the prestigious magazine Conde Nast Travel-er.Nearly 300,000 readers participated in this year's survey.Fusion Maia Resort Da Nang was ranked 11th in the Overseas Hotel Spa category, even higher than the Six Senses in the Maldives, The Banyan Tree Spa in Phuket, and The Andaman Spa in Langkawi.Fusion Maia Resort is located on My Khe Beach in the central city of Da Nang.All spa health services are included in the room rate, featuring a variety of inspired treatments by skilled Vietnamese therapists, such as massage, homemade all-natural body wraps and scrubs, and nurturing beauty.Michelle Ford, general manager of Fusion Maia Da Nang, said: "We want to inspire our guests to incorporate healthy practices into their daily lifestyle."The spa's facility also offers beauty salons, wellness lounge, steam room and sauna, in-door and outdoor wellness studios, private pool, and waterfall.Marco van Aggele, founder and CEO of Fusion, said the all-inclusive spa concept makes Fusion Maia Da Nang and all of the company's resorts special."We do everything we can to give our guests a feeling of complete openness and well-being," he said.The Fusion Group is operating six resorts and hotels in HCM City, Da Nang and Nha Trang and on Phu Quoc Island.http://bizhub.vn/corporate-news/fusion-maia-da-nang-selected-as-top-20-hotel-spas-in-world_289662.html End
