Stakeholders who were allocated land designated for forestry purposes made use of only 20 to 30 per cent of that land.
The figures were made known by deputy director of the Ministry of Agriculture and Rural Development (MARD)'s Department of Forest Management Trieu Van Luc at a workshop to assess forestry land allocation policies held in Ha Noi yesterday.
Luc said many State-owned enterprises managed large areas of forests, but only made modest profits, and if the land was managed by People's Committees at commune level, the situation was even worse because there were no resources available for management and protection activities.
Half of the land designated for forests has been allocated to State-owned enterprises, but just 27.5 per cent to households and individuals, which as Luc put it ‘failed to take advantage of a huge resource'.
Another problem was that many localities failed to identify the advantages and disadvantages of the land they were allocating to farmers, which made it difficult to punish those who lost forests or illegally used them for other purposes.
Professor Le Ba Toan, dean of HCM City University of Agriculture and Forestry's Forestry Department, said based on a study that crossed six provinces, he observed that the majority of the natural forests allocated to communities were degraded, formerly forested lands severely impacted by intensive and/or repeated disturbance, while the existing support mechanism for farmers appeared to be of limited use.
"Farmers are not benefiting from the forests so they are not really committed to protecting them," he said.
He also pointed out that the allocation process was still not equal to everyone and in some cases, localities failed to plan ahead sufficiently.
Policy expert Vu Long from the Institute for Sustainable Forest Management and Forest Certification said the progress of forest land allocation was slow.
"The allocation process has only occurred on paper but not actually on the fields," he said.
He said the resources tax on products from natural forests such as timber was high, well beyond the financial capability of households in mountainous areas.
Luc from the Department of Forest Management conceded that the relevant policies lacked consistency and were overlapping, adding that they did not encourage people to get involved in the forestry industry.
As of December 31st, 2010, there were nearly 14 million hectares of forests in Viet Nam, covering 39.5 per cent of the country.
Southern provinces urged to increase fruit farming acreage
Southern provinces should choose two or three important fruit varieties and make zoning plans for them in each locality to develop concentrated fruit-farming areas, a top agricultural official has said.
Speaking at a conference in HCM City on Monday, Pham Van Du, deputy head of the Cultivation Department, said this would help overcome the problems of small scale of production and poor efficiency and find markets.
The region, which enjoys climatic and soil advantages, has large areas under orchards and is the country's most important fruit-growing area.
In recent years fruit production here has grown significantly in terms of cultivation area, varieties and output.
But it still faced many problems like small scale and scattered cultivation, inconsistent quality, demand volatility, diseases, low global competitiveness, and lack of linkages between businesses and farmers, according to Du.
The southern provinces have so far zoned for 14 fruits in 146,760ha out of the 408,300ha on which fruits are grown. But it has been only at the district level and percolated no lower, Du said.
Nguyen Minh Chau, director of the Southern Fruit Research Institute, said that besides, some had chosen to grow fruits that are less competitive in terms of quality compared to those grown in other provinces.
Chau Nghe mango grown in Tra Vinh, for instance, could not compete with something like Hoa Loc mango, so the province should reconsider it, he said.
Delegates at the conference agreed that the zoning plans must be accompanied by the application of Vietnamese Good Agricultural Practices (VietGap) standards to satisfy also the export markets.
But Vo Mai, deputy chairwoman of the Viet Nam Gardening Association, pointed out that since consumers remained unaware of VietGap-certified fruits, farmers who grow them could not compete with others who grow normal fruits.
She and other delegates asked the Government to quickly come up with a logo for VietGap fruits.
She also wanted the Government and local authorities to help farmers obtain the Gap certificate and to have policies encouraging enterprises to build more packaging plants and warehouses to reduce post-harvest losses.
Hoang Quoc Tuan, director of the Agriculture Planning and Design Institute's Agriculture Planning Centre, said provinces should upgrade infrastructure in fruit farming areas and promote trade.
Many delegates called on provinces to co-operate to develop large fruit growing areas and secure markets for their produce.
In 2010 the southern region produced more than 4.1 million tonnes, or 57.4 per cent of the country's fruit output.
It is planned that by 2020 the area under fruit will increase to 418,000-438,000ha, yielding over 5 million tonnes annually.
Phu Quoc Island to be international trading hub
Phu Quoc Island of the Mekong Delta province of Kien Giang is set to become an eco-tourism and international trading center.
Under the province’s maritime economic development program for the period 2011-2015, Kien Giang will focus its investment in areas where it excels such as fishing, tourism, maritime transport, fishery services, the production of construction materials and processing of agricultural products.
The province is also expected to become a leader in maritime operations and will introduce socio-economic development combined with national security.
Having so much potential for maritime economic development, Kien Giang also has the advantage of having two border gate economic zones – Duong Dong and Ha Tien. It also boasts a lot of beautiful countryside and is in an excellent position to develop its trade, services and tourist industry.
The government has also defined Kien Giang as key for the protection of the country’s maritime borders.
The Mekong Delta province’s maritime economy is currently undergoing a comprehensive development.
A wide range of methods have been applied to aquaculture, raising the volume of aquatic products to 396,600 tons in 2011, up by 84,982 tons compared with 2006.
More attention is now being paid to the network of ports and harbors, including An Thoi, Duong Dong, Tho Chau, Nam Du, To Chau and Tac Cau ports.
Local people have seen their living standards improved and political security and social order ensured.
Markets: a paradise for counterfeit goods
Six out of ten market shoppers will mistakenly go home with fake or copycat products, according to a quickly-conducted survey by the Vietnamese High-Quality Product Business Association, which once again proves that markets are paradise for counterfeit goods.
Bogus producers have faked almost every kind of product available at the markets, from clothing, footwear, and bags to cosmetics, shampoo, and perfume, as long as they are well-consumed products.
“A couple of years ago, four or five distributors came to my booth and persuaded me to buy their fake products on a daily basis,” says Tam, who runs a cosmetic stand in Hoa Hung Market in District 10.
The counterfeit goods looked almost identical to the authentic ones, while costing only a third of the latter’s price, informs Tam.
“Some small traders had agreed to buy the fake products to earn profits, but buyers later returned to complain about their poor quality, and even ended up boycotting the traders,” she says.
While some traders have been wary, other have fallen victim to the bogus-product marketers, she adds.
“How could they cast any doubt when they see fake products that even bear the anti-counterfeit stamp?”
Similarly, Minh, a trader in Hoang Hoa Tham market in Tan Binh District, expressed her anger that fake products are always cheaper than the authentic ones.
“A genuine skin cream product costs VND120,000, while the similar bogus one fetches only VND30,000,” says Minh, adding that many counterfeit goods and locally-made products are now 99 percent alike.
Meanwhile, it is not difficult to find products whose brands are deliberately named similar to the well-known products to mislead customers in citywide markets.
Examples of such products are Vy Hao dishwashing liquid, Vi Mo detergent, Erio biscuit, and Todacao cosmetic, which obviously dupe consumers into taking them as the authentic My Hao, OMO, Oreo, and Thorakao brands.
“We should have a new expression -- as fast as the fake products,” says Nguyen Huu Phuoc, director of Thanh Nga Co with the Aihao brand.
“Any new product will be faked within one month of its launch.
“What is more terrible is that the bogus products are identical to the authentic ones, and the only difference is the product quality.
“Even the manufacturers are confused when they see the fake products of their brands.”
Most of the fake product makers are small, unlicensed manufacturing facilities, says Phuoc.
Meanwhile, some other manufacturers, despite having their own brands, have also turned to faking goods due to their low consumption, he adds.
Phuoc says his Aihao brand is a pitiful case of Vietnamese brand, with the company’s sales slumping by 70 percent after failing to curb the counterfeit products.
“It’s like an epidemic. After we stop a place from selling the fake products, they continue to be sold in another location, and so on,” he laments, adding that even manufacturers in other province such as Can Tho and Long An fake Aihao products.
The ratio of Aihao bogus products is now only 1 percent.
“But it’s not because we have successfully curbed the fakers, but because customers have lost faith in Aihao,” he says sadly.
“Fake product makers deliver the goods directly to traders at the markets, and offer high commissions, causing damages for the genuine manufacturers in finance and reputation,” states a representative of Nghia Nipper.
Nguyen Viet Hong, CEO of Vina CHG, a company specializing in providing anti-counterfeit solutions, says 20 orders on anti-fake stamps were placed last year.
Many local businesses have admitted that even they cannot tell the fake product from the authentic one, as the former has been made in a very sophisticated manner, he says.
“Even the anti-counterfeit stamps are being sophisticatedly faked,” he admits.
SAP impressed with Vietnam’s market
Vietnam is currently an important market in Southeast Asia for its potential and resources, said the newly appointed director of SAP Vietnam Darren Rushworth at a press briefing in Ho Chi Minh City on April 11.
Rushworth said that with its potential and present pace of development, the SAP expects to reach the targets it set for 2012 and resolve four main issues, including technical creativity, solutions for small and medium size enterprises, and cloud computing.
As a market leader in business software applications, SAP is the largest provider of ‘Enterprise Resource Planning’ systems in Vietnam.
This year, SAP will provide technologies up to international standards to state and private enterprises in Vietnam in a number of key sectors, such as telecommunications, the petrol and gas sector, the chemicals industry, manufacturing, consumer products, banking and finance.
US supports corporate social responsibility
The Vietnam Chamber of Commerce and Industry (VCCI) and the US Fair Labour Association (FLA) signed a two-year deal for a project to enhance the management of corporate social responsibility, in Hanoi on April 11.
Signatories were the Vice President of VCCI, Doan Duy Khuong and the FLA’s Chief Executive Officer, Auret Van Heerden.
Funded by the US Department of State, through the FLA, the project will be carried out by the VCCI, the Ministry of Labour, Invalids and Social Affairs, the Vietnam General Confederation of Labour and the FLA.
It will provide technical assistance to 50 leather, footwear and garment companies in Hanoi, the northern provinces of Thai Binh and Hai Duong and the southern provinces of Dong Nai, Long An and Binh Duong.
Khuong said that the project will help to harmonise Vietnam’s economic growth with its social stability. This will be based on respecting the rights of workers and improving their working conditions as well as promoting sustainability in the global supply chain.
Bird’s nest products enter Cambodia
Khanh Hoa Salanganes Nest Company opened a branch in Cambodia on April 11.
Vietnamese ambassador to Cambodia Ngo Anh Dung said the inauguration of the company will help strengthen trade relations between Vietnam and Cambodia.
Two-way trade last year reached US$2.8 billion and the figure is expected to rise to US$5 billion by 2015, said Dung.
General Director of Khanh Hoa Salanganes Nest Company Le Huu Hoang confirmed that Cambodia is a strategic investment market and that the company will focus on advertisement to bring bird’s nest products to Cambodian people.
Hoang said the Cambodian branch offers the company an opportunity to promote the Vietnamese products and diverse culture to local consumers and international friends.
Japanese group builds US$410 mln factory in Dong Nai
LIXIL Corporation, a global leader in housing equipment and building materials, on April 10 was licensed to build a US$410 million factory in the southern province of Dong Nai.
The factory aims to produce building materials, office and housing equipment, and interior decoration items.
The project is expected to raise LIXIL Corp’s productivity by 10 percent. Its products will be exported to Japan initially, and then to countries throughout the Asia-Pacific region.
Dinh Quoc Thai, Chairman of the Dong Nai provincial People’s Committee, said the project will help develop the province’s industry and increase investment potential between Vietnamese and Japanese businesses.
LIXIL Corp now possesses many famous trade names in the field of construction, such as INAX, Tostem, Sun Wave, TOEX and Shin-Nikkei.
Thua Thien Hue and Poitou-Charentes region enhance cooperation
The President of the Poitou-Charentes Regional Council of France, Segolene Royal, and Chairman of Thua Thien Hue province’s People’s Committee, Nguyen Van Cao, signed a memorandum of understanding on cooperation in Hue city on April 10.
Under the MoU, both sides will strengthen co-ordination in the implementation of cooperative projects in the fields of tourism, eco-tourism, human resource training and agriculture.
As an important partner in Hue festivals for many years, the Poitou-Charentes Regional Council of France will participate in the 2014 Hue Festival to expand the space of the festival for more local residents to enjoy the event.
The Poitou-Charentes Regional Council of France will also support the development of Hue Tourism College in compiling new training programmes, especially on eco-tourism and heritage. In addition, it will promote cooperation between Bach Ma National Park and Marais-Poitevin Garden under the Prodetour Hue project in the 2010-2013 period in order to strengthen eco-tourism and upgrade traditional houses.
In addition, the region will help Thua Thien Hue improve the quality of human resources for the tourism sector, the value of heritage sties and the management of international cooperation.
Both sides will boost cooperation among high schools and heighten the important role of Thua Thien Hue province as a dynamic member of the International Organisation of La Francophonie in South East Asia.
Credit lines to help struggling firms
Banks’ supportive credit packages are to help poor companies.
Military Bank just launched a VND10 trillion ($476 million) preferential credit package applicable until the end of 2012 with interest rates 1-1.2 per cent softer than regulated ones.
“Export firms sourcing capital to store materials for export will have their needs satisfied by our bank when they show us export document sets and pay us when they get payment from foreign banks or importers,” said MB’s Trade Finance Department head Nguyen Le Huyen.
Military Bank reportedly inked a cooperative agreement with Vietnam Chamber of Commerce and Industry (VCCI) to deploy the credit support package across the country. Accordingly, VCCI will help promote the credit package among the business community and later send a list of firms to Military Bank.
Earlier, several other banks had rolled out priority credit packages to small- and medium-size firms operating in production, trading and export. For instance, Orient Commercial Bank (OCB) offered a VND2 trillion ($95.2 million) to corporate customers with interest rates from 2-2.5 per cent lower than regulated ones.
“OCB will prioritise firms with loans of VND5-20 billion ($230,000-$950,000),” said the bank’s director Trinh Van Tuan.
But not all firms are jumping for joy.
“Looking on bank lending requirements, I suppose few firms are eligible to get these lower-cost loans. Many businesses in the wood sector are small trading units falling short of bank collateral requirements,” said Nguyen Ton Quyen, general secretary of the Vietnam Timber and Forest Product Association (Viforest).
Every year, local wood export processing firms need to import four million cubic metres of wood and they source dollar loans with interest rates ranging from 6-7 per cent per year from banks.
They are facing dwindling credit lines from banks on the back of government’s tightening credit policies. This has paved the way for foreign invested firms with access to lower-cost lending of thus 3-4 per cent per year to take the upper hand in material supply in Vietnam’s wood export processing industry.
Viforest recently proposed the central bank and the Ministry of Agriculture and Rural Development consider increasing dollar loans to wood export processing firms.
In the cashew industry, according to Vietnam Cashews Association (Vinacas), the sector was in need of around VND9-10 trillion ($428.5-476 million) to purchase 380,000 tonnes of raw cashews from farmers and then $250 million to feed import and processing needs in later months of the year.
Near-completion condos attract buyers
Condo projects that have been completed or are entering into the final stages this year are most likely to enjoy more advantages in the race to lure buyers in the current dormant realty market.
In fact, several projects have found buyers recently as the project owners prove to buyers their abilities to complete their projects as committed.
Apart from reasonable prices and flexible payment methods, buyers are much interested in the construction progress of realty schemes as well. In other words, they will only buy homes after seeing the projects in the process of completion by themselves.
Therefore, most real estate trading floors tend to focus on those projects close to completion. For instance, The Era Town project in HCMC’s District 7 has attracted up to over 40 realty trading floors when being put up for sale by Duc Khai Corporation early this month.
The project consists of ten blocks with more than 3,000 flats offered at about VND15 million per square meter. The developer will start handing over the condos to buyers from the last quarter this year.
Nguyen Thi Thanh Huong, director of Hung Gia Viet Real Estate Services Co., asserted those projects that are finished or near completion have still caught attention of clients, especially those in need of housing.
According to Huong, her company has succeeded in launching the sale of an apartment building in District 8 beyond expectation at VND1 billion a unit within one week only.
Savimex Corporation and EVN Land in cooperation with a number of property trading floors have offered for sale the Ngoc Lan project in District 7.
The condos are priced from VND14.9 million a square meter based on the 55% deposit while the remaining value is arranged for installment payment within one year. The housing products will be given to customers this month as scheduled.
According to Colliers International, the commercial apartment segment is facing challenges due to protracted economic woes and capital shortage. The local market in the year to date has witnessed a decline in selling prices of all condo segments and the trend will continue in the next quarter as predicted by the firm.
Electric cars’ tax chicane
State agencies will craft imported electric car taxes based on usage functions.
Xuan Cuong and Sao Viet Export Import companies’ proposed excise tax exemption for five electric cars imported into Vietnam in mid 2010 to service travel demands inside the Huu Nghi border gate economic zone in northeastern Lang Son province is getting positive feedback from state agencies.
The proposal came as in light of Decree 113/2011/ND-CP of December 8, 2011 and Decree 26/2009/ND-CP of March 16, 2009 guiding the implementation of the Law on Excise Tax cars running in sports and entertainment areas not registered to take part in public traffic activities will benefit from excise tax exemption.
Earlier, Quang Trung Mechanical Engineering Enterprise asked for tax exemption for electric cars imported to serve travel demands in factory area.
In fact, the demand for electric car imports catered for travel demands in non-public areas is increasing. Large cities like Hanoi and Nha Trang offer specialised tours using electric cars amid public traffic activities, while passengers at Hanoi’s Noi Bai international airport can take electric cars to reach bus stops less one kilometre from the airport.
A Ministry of Finance (MoF) representative said excise tax was levied on under-24 seat automobiles in public traffic, whereas specialised cars not in public traffic would not be subject to this tax.
However, since the time Excise Tax Law came into place electric cars were mainly imported into Vietnam to run in entertainment areas, disputes between custom bodies and businesses arose upon whether electric cars would be subject to excise tax exemption.
To avoid causing losses to state coffers, excise tax exemption for imported electric cars shall be considered by the MoF on a case-by-case basis.
In the two above mentioned cases, the MoF contemplated to propose the government exempt excise tax payment for electric cars imported to run inside Huu Nghi border economic zone since these cars got certification from Vietnam Register stating these cars did not enter public traffic.
Similarly, electric cars imported to serve travel demands in factory areas will also be exempted from paying the tax once getting Vietnam Register certification.
The MoF argued case-by-case consideration when it came to excise tax exemption of imported electric cars was important since in fact, there are many border economic zones like Lao Bao with even bigger local communities.
Princess Danae ship makes first trip to Vietnam
The French cruise ship Princess Danae on Tuesday arrived in Halong with around 500 cruise passengers and crew members on board, starting a six-day trans-Vietnam trip. This is the first Vietnam port call by the cruise ship this year.
Saigontourist Travel Service Company, which is serving these guests, said tourists were scheduled to visit famous sites such as Halong Bay, Hon Gai fishing village, and Bai Tho Mountain along with attractions in the capital of Hanoi.
The Princess Danae on Wednesday will call at Tien Sa Port in the central city of Danang for the passengers to join tours in the city and the two neighboring provinces of Quang Nam and Thua Thien-Hue where the World Heritage sites like Hue and Hoi An are located.
In the southern region, passengers will be visiting HCMC and the Mekong Delta city of My Tho. The vessel will leave Vietnam this Sunday.
Saigontourist is expected to welcome more than 140,000 tourists and crew members of foreign cruise ships such as Costa Classica, SuperStar Aquarius, Columbus, Spirit of Adventure and Europa in the first four months of this year.
Prudential reports strong growth in 2011
Prudential Vietnam Life Insurance Co. Ltd. has put its 2011 total premium revenue at VND6 trillion, a 12% year-on-year increase, re-enforcing its leading position with 39% market share.
Its new business premiums grew to a record high of nearly VND1,400 billion while total investment income reached over VND2,800 billion, rising by 28% against the previous year.
The insurer reported VND993 billion in pre-tax profit. This was the eighth consecutive year Prudential had reported profits from its operations in Vietnam.
The firm has also announced a special bonus of VND430 billion to around 104,000 customers. Prudential customers who owned participating policies issued before January 1, 2006 and maturing between January 1, 2008 and March 31, 2013 are eligible for this bonus.
This is the second time Prudential has announced a special bonus to its eligible customers. In 2007, Prudential awarded a special bonus of VND521 billion to 740,000 customers thanks to its exceptional investment performance.
Conversion time extended for gold traders
The State Bank of Vietnam (SBV) has completed a draft circular permitting gold bar traders to switch business for another six months after Decree 24/2012/ND-CP on gold bar trading restrictions takes effect on May 25.
So now gold firms have more than seven months to go after Decree 24 came out early this month. In the meantime, they have to finalize the procedures for obtaining gold bar trading certificates or completely switch to gold jewelry production and trading.
Regarding the concern that prices of gold bars of other brands than SJC could be suppressed, Nguyen Quang Huy, head of the SBV’s Foreign Exchange Department, said Decree 24 does not discriminate SJC gold bars from the others. Gold bars legally owned by organizations and individuals are recognized and protected by law and allowed to be traded at the banks and enterprises licensed by the SBV, said Huy on the central bank’s website.
Tran Quy Hai, owner of a gold shop in HCMC’s Binh Thanh District, said the draft circular offered a final chance for his firm before switching to another business field. For private enterprises, gold bar trading is the main source of income while jewelry only makes up one fifth of income.
The release of Decree 24 puts an end to gold bar trading at private firms. Therefore, Hai said he would take the transitional period stipulated in SBV’s draft circular to recover capital and look for other business fields.
According to Nguyen Thanh Truc, vice chairman of the Vietnam Gold Traders Association, when Decree 24 comes into force, the local market will be left with a mere 10-20 gold bar traders, along with some credit institutions. This will not only leave a great impact on the current 10,000 gold enterprises, but the nation’s gold trading network will also be affected, as consumers are used to trading gold at small gold shops.
However, Truc admitted the strict regulations of Decree 24 will help stabilize the local gold market.
The decree is issued in a bid to remedy the shortcomings in gold bar management, create a legal foundation to reorganize the gold market and tackle speculation and illegal trading, said SBV on its website.
In addition, Decree 24 regulates activities other than gold bar trading to be carried out only with permission of the Prime Minister and the central bank due to the many potential risks of gold trading on accounts and gold derivate activities. The decree also creates a legal foundation to handle violators.
Squid, octopus exports expected to rise
Domestic mollusc exports to major markets were estimated to increase between 0.4 to 207 per cent, fetching around US$67 million in the first two month this year, according to the Viet Nam Association of Seafood Exporters and Producers (VASEP).
South Korea and Japan remained the two biggest importers of squid and octopus, accounting for 60 per cent of total export turnover, said Nguyen Minh Tam, a VASEP representative.
In the first two months this year, the export turnover of squid and octopus to those two markets enjoyed double-digit growth of 15.9 and 41.5 per cent respectively, she said.
Exports to the EU experienced a year-on-year increase of 0.4 per cent, bringing in a turnover of $10.4 million. The EU remained a great potential market for Viet Nam's seafood exports, especially for molluscs.
Tam added that the European debt crisis had cooled down thus generating opportunities for Vietnamese seafood.
In February alone, the export value of molluscs to the EU stood at $6.4 million, 59.8 per cent year-on-year increase, bringing the total export value of this product to nearly $14 million in the first two months, or 4.5 per cent up over the first two months last year.
France and Greece have become the largest importers of Vietnamese molluscs with a growth rate of 121 per cent and 207 per cent, respectively.
Major exports to France include frozen squid with a growth rate of 200 per cent and molluscs with a growth rate of 709 per cent. Since December last year, the export value of molluscs to France rose between 2 and 3 times in comparison with previous months.
According to VASEP, many agricultural, fisheries and garment and textile products have been accepted into the EU. However, the market has changed certain policies related to preferential tax rates on seafood products from developing countries. With such changes, seafood products from Viet Nam may be eliminated from those enjoying preferential tax rates.
In addition, strict import regulations on flora and fauna have become more severe and the EU is compiling a draft on seafood labelling regulations that have also required Vietnamese seafood exporters to further study new regulations so as to promote exports.
According to economists, challenges from the EU will become opportunities for Vietnamese exporters to review and improve their business plans.
Despite facing difficulties in exporting seafood to the market, Vietnamese exporters have many opportunities at the same time. However, Vietnamese mollusc exporters must offer competitive prices and further study the EU market in terms of its laws, tax incentives and intellectual property, they said.
HCM City Real Estate Association in quandary
Several measures have been proposed by the Ho Chi Minh City Real Estate Association to help businesses overcome the ongoing real estate crisis, but so far they have been ineffective.
The Ho Chi Minh City Real Estate Association in the first quarter this year organised at least two official meetings for discussing ways to resolve the present crisis in the real estate market.
In March, it sent a proposal to the Department of Construction to establish a rescue team, which will work with districts and relevant departments to help the real estate businesses.
Several stronger measures have also been proposed, like reducing bank interest rates and providing consumers with preferential loans for purchase of their first apartments.
The Ministry of Construction has also put forward solutions like buying unsold apartments for resettlement projects and establishing a construction bank.
However, difficulties still encircle companies with high interest rates and thousands of unsold apartments.
Dr. Tran Kim Chung from the Central Institute for Economic Management said that the real estate market should not rely on capital from banks but seek other sources.
Nguyen Tran Nam, Deputy Minister of Construction said that the ministry is working on a draft project to establish a house savings bank, aimed at mobilising long term funds for housing development projects.
The National Financial Supervisory Commission on Wednesday will meet with the association on measures to recover and develop the real estate market.
According to the HCMC Department of Construction and Planning and Investment, the city has about 20,000 real estate businesses.
Of these, 2.6 per cent have a capital scale of VND200-500 billion, eight per cent of VND50-200 billion,19 per cent of VND10-50 billion and 70 per cent of small scale of less than VND10 billion.
Vietnam’s 500 fastest growing businesses honoured
Vietnam Report and VietnamNet Online Newspaper honoured 500 of the fastest growing businesses of Vietnam in Ho Chi Minh City on Tuesday.
All these 500 businesses, covering fields such as trade, services, real estate, industry, agriculture and processed food, had an average growth rate of 57 per cent during the period 2007-2010.
Among the more familiar brands are Vinamilk, Casumina, Masan, Tan Hiep Phat, Vincom, Mai Linh Taxi, and Viet Hoa Paper.
Most of these 500 businesses said that during a difficult economic phase they had to concentrate on reorganizing their structure to operate more effectively instead of expanding production.
On the other hand, they focused on building relationships and advertising their brands.
Undeserved favours for State-owned enterprises
Economists pointed out the problems of state-owned enterprises at an ongoing economic forum held in Danang.
When the Deputy Director of the Central Institute for Economic Management, Nguyen Dinh Cung, reported on the restructuring process of State-owned enterprises, he said that these economic institutions had a privilege of doing business whether they are making a profit or not, and that if their profits take a hit, ultimately everyone will suffer.
Dr. Vu Dinh Anh clarified the five typical privileges of State-owned enterprises, including the absence of fear of going bankrupt because of State backing, even if they are operating at a deficit, the freedom of changing their State monopoly into a market monopoly, bureaucratic benefits, access to capital and credit and the lack of oversight.
According to Anh, some of these privileges should to be analyzed more carefully, such as the right to impose import tariffs for essential goods and services, including petroleum, electricity, and water. He also criticised their ability to transfer debts to the State.
Anh said that many SOEs have not served the public good, emphasising the investment strategies of many of these firms, which often invest heavily in non-core businesses, without living up to their main responsibilities.
Tran Xuan Hoa, Chairman of Vietnam National Coal-Mineral Industries Group (Vinacomin), member of the National Assembly, refused to defend State-owned enterprises, but expressed some surprise at the allegations brought against them, saying that they play a crucial role in the use of natural resources and land use rights.
He emphasised that, though many banks claimed to have reduced their interest rates, his corporation was borrowing at rates of 18.5%, while private enterprises had to bear rates of around 20%.
Some subsidies in his corporation had been informed that land tax was increased by 10 times higher, which worsens the situation.
Hoa proposed to Chairman of the Economic Committee, Nguyen Van Giau to hold another economic forum in Quang Ninh Province to discuss the coal and mineral industries. This proposition was approved by Giau, who committed that this event would be held before the launch of National Assembly’s meeting in May.
Hoa said, “In four to five years, we will have to import coal, but many economists didn't expect prices to rise. Last year, our corporation had to compensate VND5,000 billion (USD239,693,192) for losses in our electricity business. If we don’t take advantage of export prices now, it would pose a risk to national energy security."
Despite Hoa's enumeration of the many difficulties faced by Vinacomin, some economists commented that it is fair for the titanium industry to be granted special privileges by the Government because of its role in the national economy.
Beverage bottler Tribeco delists in HCM City
Beverage processor Tribeco (TRI) had its last trading day as a listed company on the HCM City Stock Exchange on Monday.
It delisted more than 27.5 million shares worth a total of VND275.5 billion (US$13.1 million) on Tuesday.
The beverage firm volunteered to delist after making losses for two years and posting negative equity.-
Large unlisted firms subject to new disclosure rules
Large-scale unlisted companies will be treated as listed firms in terms of information disclosure from June.
According to the Ministry of Finance's Circular 52 on information disclosure within the stock market issued last week, unlisted firms with charter capital from VND120 billion (US$5.7 million) and more than 300 shareholders will follow regulations applicable to listed firms.
The Viet Nam Securities Depository will be in charge of naming relevant businesses.