Ho Chi Minh City is striving to achieve an annual growth rate of 10 percent in 2012 while controlling inflation, stabilizing the macro-economy and ensuring social welfare.
These goals were released at the fifth meeting of the municipal People’s Council from July 11-13.
Participants at the meeting said building synchronous infrastructure within the city is vitally important, alongside providing incentives for the poor and dealing with resettlement issues.
They stressed the need to increase supervision of food hygiene and safety, prevent epidemics, and upgrade schools for the coming academic year.
HCM City Mayor Le Hoang Quan says top priority will be assisting businesses, boosting trade and tourism, expanding markets and launching marketing and consumption campaigns.
The city will also implement agricultural subsidies, promote rural development, and build new rural area models, Quan said.
He also called for greater efforts to accelerate key projects, especially for traffic infrastructure and flood prevention, and build dormitories and facilities for students.
Garment exports up 11 percent
Vietnam exported US$6.5 billion worth of garments and textiles in the first six months, a year-on-year increase of 11 percent.
The country now ranks second in clothing exports to the US market with a growth rate of 8.5 percent, while still retaining sustainable growth in the Republic of Korea and Japan.
The garment and textile sector will continue facing difficulties due to falling demand from major markets such as the US and the EU.
This year, the sector is forecast to earn between US$18.2-18.5 billion with a growth rate of 12-14 percent if there is no big fluctuations in major markets and in the price of materials.
IFC supports businesses with US$10 million
The International Finance Corporation (IFC) will loan the Orient Commercial Joint Stock Bank (OCB) US$10 million to help small-and-medium-sized enterprises (SMEs) access credits to maintain operation in the face of the economic downturn.
The corporation said on July 13 that the loan is part of the IFC Global Trade Finance Program (GTFP) that was first joined by the OCB and the Vietnam Technological and Commercial Joint-Stock Bank (Techcombank).
Simon Andrew, IFC Regional Manager for Cambodia, Laos, Thailand and Vietnam, said his institution is committed to improving US dollar liquidity in the country’s banking system.
He says the IFC hopes more banking partners will get involved in the GTPF to create more opportunities for import/export businesses and others operating in the chain of supply and demand.
Nguyen Dinh Tung, OCB Acting General Director, said SMEs are the OCB’s key clients and the IFC programme will enable them to boost their business performance, especially as the global economy is slowly recovering.
Over the past five years, the IFC has offered more than US$1 billion in credit to Vietnamese SMEs through the GTFP.
The IFC has been cooperating with the OCB since 2011 and has granted the bank commercial endorsements worth US$20 million.
Last May, the OCB also received a US$25 million credit package targeting SMEs and businesses owned by women.
French businesses keen to invest in Vietnam
France is providing more official development assistance (ODA) to Vietnam to upgrade its infrastructure in a bid to become an industrial country by 2020.
This was confirmed by Marie-Cécile Tardieu-Smith, economic councilor of the French embassy during a recent meeting with the press in Hanoi.
She suggested the Vietnamese government remove barriers to foreign businesses, speed up administrative reform and renovate its tax scheme for some imported products.
She also stressed the need to create an equal, transparent and stable environment to facilitate foreign investment in the country.
The councilor spoke highly of the Government’s effective measures to stabilize the domestic currency and the macroeconomy to build investor trust. She said she believes Vietnam will be able to overcome the challenges and become an attractive destination for French businesses.
French businesses are increasingly seeking opportunities to invest in Vietnam’s retail, tourism, medical equipment, telecommunications and new technologies businesses, she said.
Two-way trade between Vietnam and France saw a significant year-on-year increase of 25 percent to US$2.7 billion in 2011 with Vietnam enjoying a trade surplus of more than US$1.1 billion, the councilor noted.
French businesses are operating in various areas in Vietnam, mostly in pharmaceuticals, energy, consumer products, banking and insurance.
Vietnam to help Angola develop coffee production
Vietnam, the world's second-largest coffee producer, will help Angola develop a coffee growing project covering 100,000 hectares in the next decade with a total capitalization of US$225 million.
This is following the agreement reached in Hanoi on July 12 between Vietnam’s Thai Hoa Group and two companies from Brazil and Angola, namely JN Brazil Angola LTDA and N’GOLA M’ZAMBA LDA.
The coffee growing project will be completed by 2022. In the next three years, 6,000 hectares of coffee will be grown in Angola under a joint venture with an estimated investment of US$15 million.
Brazil tops the list of leading coffee producers in the world, while Angola – the African largest economy - ranks fourth.
Vietnam, China women entrepreneurs seek ways to boost trade
Almost 100 delegates attended an exchange of Vietnamese and Chinese women entrepreneurs, which was held annually to boost trade ties and mutual understanding between the two sides.
Addressing the event in Beijing on July 12, President of the Vietnam Women Entrepreneurs Council Tran Thi Thuy said apart from Vietnam-China diplomatic ties, bilateral trade and economic relations have seen positive results.
With both countries’ efforts, two-way trade has recorded an annual average increase of more than 20 percent, reaching around US$8.4 billion in the first quarter of the year, a year-on-year rise of 16.1 percent, Thuy said.
Vietnam’s export staples such as electronic components, textile and garment apparels, steel and farm products have gained firm footholds in China, she added.
She proposed the two governments adjust regulations, import-export procedures, upgrade payment methods, concretise measures to tap economic potential to facilitate trade between both countries.
A representative of China’s women entrepreneurs, Chen Yu Fen, affirmed the great significance of the exchange in bolstering the two people’s friendship and mutual understanding.
She said she hopes the two countries’ women entrepreneurs will discuss and seek investment cooperation opportunities to further bring into play their role in promoting economic and trade ties between China and Vietnam.
Inspectors say US$73m in State funds misspent
Government inspectors successfully recovered VND1.5 trillion (US$73.3 million) of wrongfully-spent State funds in the second quarter of this year, and they have asked relevant authorities to review an additional VND2 trillion (US$96.5 million) in questionable expenditures.
The figures were reported at a meeting in Ho Chi Minh City on July 12 to review inspector activities over the past quarter.
Inspectors during the period also requested the return of 48ha of misused land and further investigation into the use of another 155ha.
In the past three months, inspectors submitted to the Prime Minister conclusions on their inspections of land planning management and land use; their inspection of troubled State-owned shipping company Vinalines; and audits of Hanoi National University, infrastructure construction projects in Ninh Binh Province, and various forestry and rubber plantation projects in the Central Highland province of Dak Lak.
Nguyen Van Kim, director of the Inspectorate’s judicial department, said his department would submit to the Government a revised draft of the Law Against Corruption for cabinet members to consider in their monthly meeting for July.
In the first half of 2012, government inspectors nationwide conducted some 6,000 inspections, of which nearly 2,000 missions have produced final reports. They detected VND3 trillion (US$145.5 million) in wrongful expenditures and recovered 1,400 ha of misused land.
Auto sales fall 41 percent in first half
Automobile sales in Vietnam fell an historic 41 percent year-on-year in the first six months of 2012, due to the economic recession.
The Vietnam Association of Automobile Manufacturers (VAMA) said that total vehicle sales for the first half reached just 42,928.
While car sales fell by 47 percent to 16,305 units, sales of trucks slipped 30 percent to 26,929 units.
In June, 6,444 vehicles are sold, down 43 percent over the same period last year, and 4.6 percent compared to the previous month, it added.
According to VAMA's chairman Laurrent Charpentier, auto sales for the year are projected to hit around 80,000 units given the slow start.
The Ministry of Industry and Trade (MoIT) in April also forecast that Vietnam’s total car sales in 2012 will drop drastically and return to 2007's level of some 80,000 units.
Last year, sales reached 138,000 units, a drop of 5 percent compared to 2010.
MEIWA company licensed to invest in Binh Duong
MEIWA Vietnam limited company has been licensed to invest fully in building a factory in Ben Cat industrial zone of Binh Duong province.
The factory is scheduled for completion in March 2013 with a total capitalization in the initial stage estimated at VND125 billion.
Tran Van Lieu, Chief Manager of Binh Duong industrial zones said the factory will produce different industrial products.
Since early this year, Binh Duong has attracted more than US$2 billion in foreign direct investment (FDI), doubling its yearly target and accounting for more than 30 percent of Vietnam’s total FDI attractions.
They are 2,000 projects operating in Binh Duong with a total capitalization of US$17 billion.
Business confidence grows after economic recovery in Q2
The Vietnam’s Business Confidence Index (BCI) in the second quarter of this year rose seven points over the previous quarter.
According to a survey conducted by World Vest Base Financial Intelligence Services Company Vietnam (WVB FISL), the index was 20 points higher than the third quarter in 2008 when it was first compiled, showing that the country’s business community has confidence in the country's economic recovery.
The survey, which was carried out from June 15 to the first week of July, covered 154 Vietnamese enterprises operating in 11 major industries who currently take the lead nationwide in terms of total assets, turnover, brands and number of employees. More than 50 percent of them are small- and medium-sized enterprises.
It revealed that more than 44 percent of businesses said that Vietnam's economy is now healthier, almost 36 percent said it stays the same and more than 20 percent said it is now worse than last year.
For the next 12 months, 71 percent of respondents said they believe it will get better, while only 3 percent are worried about further economic gloom.
Worthy of note is that nearly 71 percent of those interviewed said that they expect to do even better in 2011, nearly 25 percent thought the economy will remain stagnant while 4.5 percent are worried that they will face tough times over the next 12 months.
Nearly 51 percent have plans to keep their labour force intact, 35 percent said they will recruit more employees, while 14 percent said they will lay off part of their labour force.
Most of the respondents said that the procedures they have to endure to access credit, along with inadequate tax policies, are the worst difficulties they have to face with.
On top of that, many said that the amount of fake goods that are currently flooding the market is their greatest concern, because of their poor quality. This results in companies losing their prestige with consumers and their brands become associated with inferior products.
As for factors that will affect business operations in the second half of this year, many respondents pointed to inflation, economic instability, difficulties in accessing capital and falling consumer demand.
US$300 million yarn factory under construction
TexHong Textile Group from China began building a yarn factory in Hai Yen industrial park, in the northern province of Quang Ninh on July 10.
The US$300 million factory will have 6 workshops covering an area of 40 ha with a total design capacity of nearly 140,000 tonnes per year.
In the first and the second phrases of the project, a cluster of four workshops will be built to produce 92,000 tonnes of natural cotton and synthetic fabrics, cloth and by-products a year.
Construction of the last two workshops with a combined capacity of 46,000 tonnes per year will be completed in the third phase, lasting until 2017.
The factory will go into operation in the third quarter of 2013.
Vietnam’s economic transparency under strict scrutiny
International partners are paying greater attention to transparency in Vietnam’s socio-economic development before they make decisions on investment and cooperation.
According to the recent survey “Vietnam in Transition: Changing Attitudes towards the Market and the State 2011” (CAMS 2011), jointly conducted by the Vietnam Chamber of Commerce and Industry (VCCI) and the World Bank (WB), transparency is one of the most important criteria in the market economy. It plays a key role in establishing organizational principles and administrative management goals. However, there is growing concern over transparency in Vietnam’s socio-economic situation.
Dr. Dau Tuan Anh, Deputy Head of the VCCI Legal Department, says around 92 percent of participants in the CAMS 2011 survey, mostly media workers, researchers, diplomats and international organization staff, emphasized the need to ensure transparency in drafting plans and implementing State policies.
The survey shows that transparency in making and implementing policies is still low. Dr. Tuan Anh says most Vietnamese people are not fully aware of how important transparency is to the policy making process.
Sharing this view, leading economist Le Dang Doanh says international partners are familiar with transparency in the global market but now they are facing an unpleasant lack of transparency in Vietnam.
The Provincial People’s Committees, as well as ministries, and other agencies, are pessimistic about the transparency situation in Vietnam, which is bringing to bear upon them, Doanh says.
In the current context of deeper international integration, people and civil organizations in both Vietnam and abroad are not satisfied with the transparency situation in the country.
Dr. Nguyen Tran Bat, Chairman and General Director of Investconsult Group, says Vietnam’s transparency in almost all sectors is being closely scrutinized from different angles by the outside world.
Bat elaborates that before deciding to invest in Vietnam, investors must know facts and figures such as per capita GDP, purchasing power, and consumer demand in different areas across the country. If investors do not have this important information confirmed by the Government, they cannot devise an investment strategy nor do business in Vietnam. Transparency requires accurate and adequate information on all relevant factors to help properly assess investment risks, he adds.
Deputy Minister of Planning and Investment Dang Huy Dong says transparency in the national economy will have a significant impact on attracting foreign direct investment (FDI), especially when Vietnam gives priority to the development of the FDI sector on an equal footing with other economic sectors.
He considers the FDI, private and State-owned sectors as the three key pillars that make it possible for Vietnam to achieve an average annual economic growth of around 7 percent.
To attract more FDI, Nguyen Xuan Trung from the Vietnam Academy of Social Sciences (VASS) claims it is essential to have a synchronous and transparent legal system to ensure strict implementation of policies at all levels. He also underlines that legal guidance must be issued promptly and comprehensively to avoid “exceptional cases”.
Country Director of Asia Development Bank (ADB) in Vietnam, Tomoyuki Kimura, says increasing transparency in the financial activities of State-owned enterprises (SOEs) will be an obvious signal that the Vietnamese Government is really committed to pushing through reforms.
Vietnam must improve its transparency if it wants to build partnerships and consolidate investor trust, he adds.
Exporters buy Indonesian coffee to meet contracts
Many local traders have decided to ignore Vietnamese coffee and buy Indonesian coffee instead to ensure timely delivery to overseas buyers as local growers hold back, waiting for higher prices.
The director of a HCM City-based farm-produce trading firm said that many local traders have turned to Indonesia coffee which was priced US$21 lower per tonne.
In Viet Nam, the coffee crop is over and there is not much inventory left, while Indonesia has had a bumper coffee crop, and is offering abundant and cheap supplies, according to Pham Ngoc Bang, deputy director of the Dak Man Coffee Joint Venture Co.
"[Vietnamese] farmers have lost confidence in [local] traders and processors. They now harvest and process on their own, then stockpile their products waiting for good prices, resulting in dwindling supplies," Nguyen Nam Hai, general director of the Viet Nam Coffee and Agricultural Products Assessment for Export and Import JSC. told the Thoi Bao Kinh Te Sai Gon (Sai Gon Economic Times) newspaper.
Hai said local farmers kept the products themselves and did not know the right time to sell at good prices.
Doan Van Ha of the Ha Noi Trading Corporation said that in this situation, exporters with long-term contracts would suffer the most because they signed the contracts when local coffee prices were low, but would have to buy at higher prices now.
To deal with this problem, coffee exporters could develop stable material zones in many ways including cultivating the crop themselves or hiring farmers to do so, Hai said.
He said growers and traders should also ensure that coffee is cultivated and processed in accordance with the international standards.
According to figures from the Viet Nam Coffee and Cocoa Association, Viet Nam is currently the world's number one producer of robusta coffee, followed by Brazil and Indonesia. However, experts says Brazil is likely to take top spot in the next five years.
In a recent report, FO Licht experts forecast that Viet Nam is likely to produce 23.7 million bags of coffee in the 2012-13 crop.
Stalled Can Tho refinery project may lose licence
The municipal People's Committee has been advised to revoke the Can Tho oil refinery project with a registered capital of US$538 million as investors have failed to develop it after repeated extensions.
Participants at the fourth session of Can Tho People's Council in 2011–16 term recently made the suggestion.
Licensed in May 2008, the project is a joint venture between Viet Nam's Vien Dong Investment and Trade Joint Stock Co and the US-based Semtech Limited, with the Vietnamese company owning 30 per cent of the holdings.
In July 2009, the developer asked to adjust the refinery's area down to 50ha from the projected 250ha in the city's O Mon District, with an accompanying investment capital of $350 million.
This move was attributable to the investor's decision to revise its production line and technology after its fact finding tour overseas.
Despite the municipal People's Committee's approval to slash the refinery's area, the investors, however, have yet to pay in advance money used for land clearance compensation, estimated to cost VND150 billion ($7.1 million).
Duong Cam Thuy, Deputy director of the municipal Planning and Investment Department said Vien Dong Investment and Trade Joint Stock Co found a new partner after the US Semtech Limited withdrew from the project in 2009 and submitted documents proving its financial capacities to her department.
"We have been investigating these documents, collecting opinions from relevant authorities and then will consider some revisions of terms of the previous investment licence," Thuy said.
Meanwhile, the city's People's Committee has decided to withdraw eight real estate projects in the city due to slow implementation.
These projects included An Binh new urban area, residential areas in Hung Thach and Phu Thu Ward, South Can Tho office building, hotel and urban area complex and Chau Van Liem Ward resettlement area in O Mon District.
Transparency in reporting honoured
Fifty companies listed on Viet Nam's two stock exchanges last Saturday received awards for their outstanding annual reports, particularly for their transparency, which was included as one of the key criteria.
About 700 companies participated in the contest organised by HCM City Stock Exchange, Dau Tu Chung Khoan (Securities Investment) newspaper and fund-management company Dragon Capital.
Other criteria include professionalism, creativity and risk-forecasting ability, among others.
Ten companies with the highest marks are Bao Viet Holdings (BVH), Hau Giang Pharmaceuticals (DHG), PV Drilling (PVD), Sai Gon Securities Inc. (SSI), Binh Minh Plastics (BMP), Asia Commercial Bank (ACB), Corporation for Financing and Promoting Technology (FPT), Truong Thanh Furniture (TTF), PetroVietnam Fertiliser and Chemicals Corp (DPM) and Hoa Phat Group (HPG), all listed on the HCM City Stock Exchange.
BVH won a special prize for the excellent design and content of its annual report.
"One of the most important factors for sustainable growth of our stock market is information which is transparent and easy for investors to access," said Phan Thi Tuong Tam, HOSE general director.
"The annual report gives investors an overview of the company's past year's performance and plans for the coming year, as well as commitments from managers on the corporate future," she added.
State Securities Commission Chairman Vu Bang said the awards, now in its fifth year, encouraged listed companies and public ones as well as to make good annual reports and improve their awareness on information disclosure, as regulated by state laws.
"We hope that efforts to stimulate businesses to increase transparency in releasing information, like these awards, together with the improvement of the legal framework, will contribute to a safe, healthy and effective stock market," said Bang.
Speaking about the requirements demanded from professional investors and investment funds on annual reports, Dominic Scriven, general director of Dragon Capital, stressed that businesses should focus more on risk-assessment and solutions to address risks.
"Businesses should pay attention to both financial and non-financial risks," he said, adding that, elsewhere in the world, businesses were focusing on management of environmental and social risks.
"The future of businesses will depend on their responsibility to the environment and society and their commitment to and policies for a sustainable development," said Scriven.
During the awards ceremony, 15 companies including Hoang Anh Gia Lai (HAG) Sacombank (STB) and FPT received diplomas of merit from the SSC for having won the annual report awards for several consecutive years.
Interest on dollar deposits rises
Many commercial banks are violating the central bank's deposit interest-rate cap on the US dollar, according to independent market watchdogs.
Under the central bank's regulations, the ceiling on US dollar deposit interest-rates is limited at 2 per cent per annum.
However, some banks are offering interest rates of 4 per cent and even 4.5 per cent per annum for US-dollar deposits, particularly those with high value.
An official of a foreign bank in Viet Nam, who declined to be named, said the sharp increase in the dollar deposit interest-rate had not been caused by a liquidity problem at banks.
Since January, the central bank has been buying an additional US$1 billion to put in foreign-currency reserves so commercial banks would not be short of the US dollar.
Experts said the banks were offering higher rates than the central bank's cap in an effort to attract deposits to increase the volume of future credit activities.
For the first six months of the year, the banking sector's credit-growth rate reached only 0.76 per cent, while the target set for the year is between 8 per cent and 10 per cent by the year-end.
Thus, many commercial banks still want to attract more deposits to prepare for increasing credit activities in the coming months.
In the race to raise capital, some banks have chosen dollar deposits, considering them to be a better source to ensure liquidity.
Many banks said that the costs to raise capital by mobilising US dollar deposits was much cheaper than dong deposits, even if the dollar cap is broken. In addition, their liquidity remains ensured.
Deposits in dong raised in the last six months increased by 9 per cent, while loans in dong fell by 0.04 per cent compared with the figure last year.
In contrast, the US dollar mobilised in the same period this year dropped by 6.72 per cent, and US dollar loans rose by 0.6 per cent.
Because of this disparity, some banks are poised to continue to violate the central bank's US dollar interest rate cap to attract dollar depositors.
According to a report from the State Bank of Viet Nam's branch in HCM City, the liquidity of the entire city-based banking sector remains stable, but there is great demand for capital for credit and other payments from banks that are classified as weak.
Experts eye credit loans for businesses
Senior experts sat down together yesterday to discuss ways of handling low growth of credit loans, 0.76 per cent in the first half this year, caused mainly by large inventories due to the global economic crisis.
At an online dialogue yesterday afternoon between leading economists and readers of Viet Nam Economic Times, Cao Sy Kiem, former governor of the State Bank who is also chairman of the Viet Nam Association of Small and Medium-Sized Enterprises, said the central bank's decision to lower lending interest rates aimed to rescue businesses and help them overcome difficulties.
Le Duc Tho, deputy general director of VietinBank, said his bank had made it easier for businesses to access credit by offering more concerted measures for borrowers. The bank was willing to provide those in a sound financial position with competitive lending interest rates, and restructure existing loans for those who were experiencing difficulties.
Nguyen Tri Hieu, an independent finance expert, said banks were responsible for assisting businesses, and should be ready to support them no matter what their financial situation is.
Hieu said for instance, if a business fell into insolvency and bad debt, the bank needed to conduct suitable measures to assist the business while ensuring its own benefits. If the business was unable to recover and was on the verge of bankruptcy, it would have to liquidate its assets or face a court appearance.
The above-mentioned measures aimed to select suitable borrowers so as to maintain capital and benefit the banks.
Le Thanh Trung, deputy general director of HDBank, said: "To increase credit growth to 10 per cent in the remaining months this year, we need to stimulate demand for the entire market, especially in the retail and consumption sectors.
"As we all know, businesses in retail and consumption currently hold large inventories. We need a policy to stimulate consumption such as programmes related to education, healthcare, housing and other essentials."
For commodities where consumption needed to be stimulated, relevant bodies could consider slashing value added tax and looking at different capital channels.
If the above issues were handled in the correct manner, credit would grow, Trung said.
Sharing the idea, Le Duc Tho of VietinBank said the State Bank needed to restructure the national economy and implement suitable policies to boost aggregated demand on the domestic market.
The central bank was also asked to continue regulating policy on credit loans to adapt to changes in the market, while enhancing both corporate and risk management.
Tho said in the context of economic turmoil, businesses needed to make concerted efforts to raise production managerial skills and boost consumption, while mobilising all financial and human resources available.
On the same subject, Nguyen Tri Hieu said the State Bank had called on commercial banks to cut interest rates on existing loans from as high as 19 per cent down to 15 per cent starting from July 15 to ease financial difficulties for businesses.
However, Hieu noted that the central bank and relevant bodies needed to outline stronger measures.
In addition, the Government needed to enhance the performance of credit guarantee funds.
Many of these funds have been established across the country, but their charter capital tends to be low and they lack professional skills. As a result, these funds do not meet customers demand.
Economic prospects were uncertain for the remainder of this year, and how interest rates progressed remained the greatest question for the nation's coming monetary policies, said senior economic expert Le Xuan Nghia at another meeting in Ha Noi yesterday.
Nghia said stable exchange rates, declining interest rates and improving foreign exchange reserves were good signs for the economy, but frozen credit flows had caused a "mortal disease" for it.
While economic development depended largely on investment, investment progress was slow, he said, anticipating only around VND18 trillion (US$865.38 million) worth of foreign direct investment (FDI) and VND20-22 trillion ($961.54 million-$1.06 billion) worth of public investment would be disbursed each month for the remainder of the year.
Lending hardly increased, he said, outlining three economic scenarios for the second half of the year:
If lending grew 1 per cent per month, this year's gross domestic product (GDP) would increase 5 per cent, accompanied by a monthly inflation rate of about 0.5 per cent.
If lending grew 1.5 per cent a month, GDP and inflation would hit 5.2 per cent and 1 per cent, respectively.
If lending grew 2 per cent a month, the correlative figures would be 5.5 per cent and 2 per cent.
Too great a credit increase to boost economic growth would fuel high inflation, Nghia warned, saying the second scenario would be the most suitable direction for the country.
He said there was a very low possibility that interest rates would be further reduced as banks still had to maintain significantly high rates to compensate for bad debt, although in theory, deposit rates for dong could be cut by 1 per cent more and lending rates by 3 per cent.
"The possibility of an interest rate adjustment will depend on how bad debt is dealt with," he said, noting that the State Bank of Viet Nam had already completed the first phase of restructuring the banking system by targeting fragile banks, and would now concentrate on dealing with bad debt.
He said the central bank was expected to announce more specific policies regarding this issue between now and the end of the year. "Enterprises should approach banks to restructure existing old loans as well as negotiate new borrowing, starting now."
Nghia said with positive signs in the global economy, especially improvement in the US, Japan and East Asia, the domestic economy was expected to rally in two to three quarters.
At yesterday's meeting, business representatives said they still faced difficulties related to matters such as taxes, loan access, input costs and legal frameworks, despite recent Government efforts to prop up enterprises.
Nguyen Duc Kien, vice chairman of the National Assembly's Economic Committee, said the Government had created every necessary condition and businesses should now build new strategies to survive.
They should pay most attention to restructuring markets, products and organisations, besides intensifying mutual association, he suggested.
Nghia urged firms to cut unnecessary spending, stressing that harmony within the community was now of great need to help Government policies take full effect.
Japan's Foster Group opens mobile component factory
Foster Electric Viet Nam Co Ltd, a subsidiary of the Japanese-based Foster Group, inaugurated a factory to manufacture mobile components at Vinh Hoa – Hung Nam Industrial Zone, Go Quao District, in southern Kien Giang Province on Tuesday.
The factory, the first of its kind in Kien Giang has a total investment capital of more than VND12 billion (US$570,000). It has completed the first phase, including an assembly of the components with an area of 7,000sq.m and an annual capacity of one million products. It is expected to increase capacity to two million products per year in the second phase.
Construction of fibre plant mill begins in Quang Ninh
Texhong Textile Group of China started the construction of its fibre plant in the Hai Yen Industrial Zone, Mong Cai City, in the northern Quang Ninh Province on Tuesday.
The project, the first and the biggest FDI (foreign direct investment) project so far in the province, is being carried out in an area of over 40ha, with the total investment capital of US$300 million.
Its annual production capacity is expected to reach around 140,000 tonnes, with 92,000 tonnes per year for the first and second phases and 46,000 tonnes per year in the third phase. The plant is scheduled to officially come into operation in the third quarter of 2013.
Ha Noi authorities tighten price control measures
The Ha Noi Department of Finance will co-operate with the departments of tax and market management and the municipal police to tighten the control of price registration and trading essential goods such as gas and milk powder for children.
The department set up two inter-sectorial groups to inspect prices of 18 businesses in the first half. Of that, three gas traders and a milk business have been fined VND77.5 million (US$3,690) and VND30.5 million ($1,452) respectively.
HSBC launches financial literacy programme
HSBC Bank (Viet Nam) Ltd started to facilitate the programme Junior Achievement More than MoneyTM (JA More than Money) for the second year running in Viet Nam offering elementary students in selected schools six sessions of engaging, academically enriching, and experiential lessons in financial skills from yesterday to mid-August.
"The aim of this foundation course is to introduce school kids to the basics of business, banking and finance," says Jai Pawani, COO and Chairman of Corporate Sustainability Steering Committee of HSBC Viet Nam. "Our ultimate goal is to boost financial literacy in Viet Nam and help build a firm foundation for the country's future socio-economic development."
VIB to make preferential loans to exporters
A credit agreement was signed between the Viet Nam International Bank (VIB) and the Netherlands Development Finance Company (FMO). Under the agreement, FMO will provide VIB with preferential credit resources through the Asia Development Bank (ADB) ‘s global trade assistance programme. The money will be lent to import-export firms.
Plan to build new eco-urban area in Hoa Binh
The People's Committee of Luong Son District in the northern province of Hoa Binh announced a plan on Tuesday for a VND790 billion (US$37.6 million) project to build the Dong Truong Son eco-urban area.
Covering an area of 98ha, the area is located 46 km from Ha Noi, and will include commercial, service, sports and entertainment areas. Construction work is expected to start in the third quarter of this year and completed by the end of 2015.
The project's investors are Reenco Song Hong and Reenco Hoa Binh.
Indochina Plaza buyers offered preferential loans
The Bank for Foreign Trade of Viet Nam (Vietcombank) and Indochina Land Developer, one of Viet Nam's leading financial services groups with diversified fund management and financial advisory businesses, jointly launched a programme offering preferential loans for homebuyers of the Indochina Plaza Ha Noi project.
The programme last for one month, starting from July 5. Buyers will be able to take out interest free loans worth up to 60 per cent of the apartment over 20 years.
The development has 386 flats, one office tower with a total area at 18,000sq.m, and four trade centres with a combined area of 14,000sq.m.
Completed projects top list for homebuyers
Completed apartments or those that were nearly finished were the most attractive to buyers, according to a recent report on Ha Noi's real-estate market in the second quarter by Knight Frank, a global property developer. Homebuyers were mainly looking for low-end apartments from VND800 million (US$38,000) to VND2.5 billion ($119,000) with an area of about 50-90sq.m, whereas demand for medium and high-end was poor, according to Knight Frank.
Real estate developer signs eco-town planning contract
Nam Long Investment Corp inked on Thursday a contract with CPG Vietnam, an affiliate of CPG Consultants Singapore, for the latter to provide consultancy on a master plan for a residential project in Long An Province.
The 102ha Ehome City Project, 30 km away from HCM City, will be a tropical ecological town with more than 12ha covering a lake and a central park in addition to smaller green spaces.
There will be an administration and public service area to serve owners of around 1,100 houses and 4,700 apartments.
Foreign investors divest from Viet Nam
Viet Nam was one of the three Asian markets from which foreign investors divested in the first six months of this year, according to Bloomberg.
Of the three, Taiwan saw the greatest outflows of capital, with US$767 million withdrawn, while Pakistan lost $30 million and Viet Nam US$26 million.
The year-to-date net value of foreign investments in 10 Asian markets at the end of the first half reached $25.5 billion, with India and Japan ranked first and second, attracting net investments worth $8.6 billion and $8.2 billion, respectively. In three ASEAN countries – Thailand, the Philippines and Indonesia – net values reached between $219 million and $2 billion.
Brokerages implement electronic trading
Ninety-two securities companies have been approved to operate electronic trading as of July 10, the State Securities Commission announced. In addition to these companies, other brokerages have already developed the new method but were in the process of registration pursuant to Ministry of Finance Circular No 50/2009/TT-BTC on electronic trading platforms, the commission said.