Many farmers in Da Lat , know nas the City of Flowers, have switched to hi-tech floriculture in recent years, heralding a transformation of the agriculture sector in the Central Highlands province of Lam Dong.
The province now has a total of 3,800ha dedicated to hi-tech cultivation of flowers, according to the provincial Department of Agriculture and Rural Development.
Nguyen Van Son, the department's deputy director, said most hi-tech farming areas in the province were located in traditional flower villages, particularly in Da Lat, the provincial capital.
The application of advanced technology had resulted in higher productivity and value than traditional cultivation, he said.
With hi-tech floriculture, farmers grow flowers in greenhouses with automatic irrigation systems.
Hi-tech farming brought in average annual revenues of between VND800 million (US$38,000) and VND 1billion ($47,600) per ha, 1.6 times the earnings from traditional cultivation, Son said.
Vu Thuan, who has planted chrysanthemums in a 6,000sq.m greenhouse in Ha Dong Flower Village in Da Lat City's Ward 8 for several years, earns around VND180 million ($8,570) per 1,000sq.m.
Thuan said after deducting all production costs, he earned a profit of VND90-100 million ($4,290-4,760) per 1,000sq.m.
The village has more than 400 households growing flowers on a total area of 50ha. Of this figure, 30ha are planted in greenhouses.
Similarly, most farmers in Thai Phien Village in Da Lat's Ward 12 are growing flowers in greenhouses with automatic irrigation systems.
Nguyen Dinh Huong, deputy chairman of the Ward 12 People's Committee, said Thai Phien had a total agricultural land of 430ha, of which 300ha are being used to grow flowers in greenhouses.
Thai Phien now produced about 300 million blossoms a year, he said. Van Thanh Village in Da Lat City's Ward 5 is famous for growing roses.
Tran Thi Kim Thuy, owner of the Hoa-Thuy Flower Shop in Ward 5, said the application of hi-tech farming had improved villagers' lives.
Thuy said her family had 3,000sq.m of land devoted to rose cultivation and earned an annual profit of no less than VND40 million ($1,900) per 1,000sq.m.
The application of hi-tech farming had been a breakthrough in agricultural production, bringing about far-reaching changes in rural areas as well as the lives of farmers in Lam Dong, said Pham S, deputy chairman of the provincial People's Committee.
The average revenue from agriculture production in Lam Dong had increased from VND27 million ($1,290) per ha in 2003 to VND80 million ($3,800) at present, he said.
Hi-tech farming occupied just 3 per cent of the province's total agricultural area, but it accounted for 18-20 per cent of the total production value of the agriculture sector, he said.
Lam Dong began a programme to promote hi-tech agriculture in the province in 2004, focusing in particular on floriculture in Da Lat City and other key localities.
Previously, a few companies and households were the only ones applying hi-tech floriculture in Lam Dong, but this number has increased exponentially in the last seven to eight years.
Lam Dong flowers are exported not only to neighbouring countries and territories but also to the EU and North America.
Last year, 165 million blossoms worth a total of $18 million were exported from the province. These included roses, chrysanthemums, carnations, cymbidium orchids and gerberas.
Stubble burning lowers visibility
The burning of stubble has left a pall of black smoke over western parts of Ha Noi, particularly in the districts of Quoc Oai and Thach That, raising health concerns and disrupting visibility on roads.
Vu Van Hau, director of the city's Natural Resources and Environment Department, said farmers in Quoc Oai and Thach That districts had been burning stubble for the last few days after harvesting their rice crops. South-easterly winds had made matters worse, Hau said.
Nguyen Thi Binh, a resident of Tu Liem District, said she had been forced to keep all doors and windows shut to prevent smoke from entering her house. She and her children had also been forced to wear face masks and sunglasses to protect their eyes and lungs.
Binh said she was particularly concerned about one of her children who is asthmatic.
Dr Dao Bich Van, from the National Hospital of Tuberculosis and Respiratory Diseases, said inhaling smoke would aggravate respiratory diseases and lead to increased incidents of flu and rhinitis.
She said people should turn on fans and air-conditioners to circulate the air in their homes.
Meanwhile, poor visibility is being blamed for a number of accidents on highways 32, 21B and the Lang - Hoa Lac road.
Le Chung, from Dong Da District, said her car was nearly hit by a truck on Highway 32 last Saturday because of the smoke from stubble burning.
Director Hau said his department at this time of year always asked district-level authorities to monitor the situation but to little avail.
Nguyen Van Sinh, chairman of Thach That District's Binh Yen Agricultural Co-operative, said rural households no longer burnt straw for cooking but used gas or electricity instead. However, he said they had to burn straw to produce fertiliser for their agricultural land.
The Ministry of Natural Resources and Environment said it was looking into ways of minimising the harmful environmental effects of burning stubble.
VAMA wants car registration fees cut to 10% over poor sales
A drastic auto sales decline has led the Vietnam Automobile Manufacturers Association (VAMA) to request HCMC and Hanoi authorities to slash car registration fees to 10% from the respective 15% and 20% to prop up lackluster demand.
The two cities are the nation’s biggest auto markets. According to VAMA, the fact that car registration fees were hiked from 10% to 15% by HCMC and from 12% to 20% by Hanoi early this year has dashed many people’s hopes of owning a car.
Moreover, with several new fees expected to be introduced soon, such as a personal car ownership restriction fee, the auto market has almost come a standstill. Many consumers deem the annual fee of VND10-20 million as too high.
As a result, the automobile market has seen a sharp drop in sales. Over the first five months, the number of vehicles sold plunged by 40% over the same period last year.
Therefore, in a bid to revive the auto industry, VAMA has proposed the people’s councils and committees of the two cities reduce the car registration fees to at least 10%.
VAMA said the auto sales slump had affected budget revenues of the provinces and cities where automakers and assemblers operate because VAMA members have to revise down their production plans in response to the poor sales. In addition, members of VAMA have laid off a large number of employees to cope with the tough situation.
Earlier, to rescue the market, VAMA petitioned the Government to disapprove of the proposed personal car ownership restriction fee, and at the same time, lower car registration fees to reasonable rates. In particular, the industry association suggested a 5% fee rate applicable nationwide, similar to the registration fee of 2% applied for all trucks.
VAMA said it is willing to meet with the people’s councils and committees of HCMC and Hanoi over measures to improve the traffic situation in these cities and develop the auto industry in accordance with the development plan for the Vietnam automotive industry until 2020, with a vision to 2030 compiled by the Ministry of Industry and Trade.
Phong Phu to issue VND110 billion shares
Phong Phu Corporation, which is active in textile-garment production, real estate and financial investment, has announced a plan to issue VND110 billion worth of shares to the public to strengthen its financial position.
The firm will offer existing shareholders 6.25 million shares worth VND10,000 each at the ratio 8:1, which means shareholders can buy one more share for every eight shares held before May 25.
In addition, Phong Phu will issue 3.75 million shares for strategic shareholders and other organizations and individuals at VND14,000 per share.
Under the share sale plan, the time for registration and payment is from June 20 to July 14, while rights transfers will be carried out between June 20 and July 13.
In a report, Phong Phu Corp. said the purpose of this share issuance is to mobilize more capital to guarantee its financial structure, reduce financial risks from overdependence on bank loans, enhance financial autonomy, and supplement the company’s working capital.
The total capital that the company will need this year is some VND480 billion, in which VND310 billion will be sourced from bank loans, VND50 billion from its own capital and the remainder from share sales.
Phong Phu’s chartered capital is currently VND500 billion. This year the company is aiming for VND260 billion in after-tax profit, down 16.3% against last year.
According to the report, its revenue and profit last year surged significantly thanks to the proceeds from a project liquidation worth VND740 billion, including a profit of VND300 billion. Excluding irregular earnings, the firm’s profit target this year is still higher than last year.
Phong Phu expects to pay dividend at 25% this year, the same as last year. State shareholders hold a 52% stake in Phong Phu, while domestic organizations hold 33.8%, individuals 9% and foreign shareholders 5.2%.
Life made easier for seafood exporters to Japan, Canada
The Ministry of Agriculture and Rural Development is working to ease regulations on chemical substance and antibiotic residue inspections of seafood shipments bound for Japan and Canada, said the Vietnam Association of Seafood Exporters and Producers (VASEP).
According to VASEP, the ministry has scrapped Decision 2654/QD-BNN-QLCL it issued in 2011 to strictly examine seafood exports to Canada and Japan.
The decision required all shipments of shrimp, octopus, tra and basa fish and processed products bound for the Canadian and Japanese markets be inspected for Enrofloxacin and Ciprofloxacin residues. Especially, only shipments which are already checked and granted with quality and food safety certifications in line with the decision could be shipped to the two countries.
Now the ministry just monitors shipments of exporters that have got Japanese warnings over violations regarding food safety and hygiene, antibiotic and chemical residues.
Truong Dinh Hoe, general secretary of VASEP, said the cancellation of the decision helps local exporters save time and money as Japanese buyers checks 100% of seafood imports from Vietnam, anyway. On top of that, the decision forces local exporters to carefully check their products prior to delivery.
“Canceling the decision also ensures fairness among companies in the industry. Those companies able to safeguard the quality of their products will win,” Hoe said.
The ministry’s latest move comes as many fish exporters have repeatedly complained that the decision cut into their export performance.
According to VASEP, the Food Safety Law, effective from July last year, provides that relevant authorities will only grant Certificate of Origin (C/O) for those importers asking for it. In fact, Japan doesn’t request this documentation from exporters.
Half of imported apples come from China
If you ate an apple this morning, there’s a good chance it came from China. The country is responsible for 48 percent of apple shipments to Vietnam, according to a recent report by the General Department of Customs.
Though the apples’ safety is undergoing closer scrutiny now, the department said imports of Chinese produce in the first five months of this year rose 24 percent compared with the same period last year. Of the fruits and vegetables, apples come in at third highest by import volume.
Apple shipments from China peak at US$1.6 million a month.
Even as Chinese apples are flooding the markets across Ho Chi Minh City, the Ministry of Agriculture and Rural Development recently ordered an inspection after Chinese apples were found to be poisonous in their country.
Growers in China’s Shangdong Province reportedly wrap Fuji apples in toxic plastic bags to preserve their colorful gleam and crispy flesh as they ripen.
The Plant Protection Agency said it is collecting samples of Chinese apples sold in Hanoi and Ho Chi Minh City for toxicity tests.
Small traders said the apples sell quickly because of their price. At VND6,200 to VND8,500 a kilogram, they cost much less than U.S. apples that go for VND16,700 per kilogram.
Banks secretly hike ATM transaction fees
Many banks have increased their fees for ATM transactions such as checking balances, transferring, or printing statements without informing cardholders, while some have begun charging customers for on-us transactions, or those made within the same network.
The fee collections have been implemented in secret while the draft bill to decide whether banks can officially charge customers for ATM transaction is still in the feedback-collecting stage.
On June 6 Thu Hang, who works for a media company in Ho Chi Minh City’s Phu Nhuan District, used her Techcombank ATM card to withdraw money at an ATM booth of another bank, and was stunned to see that the fee for making an interbank transaction is VND5,940.
“It’s nearly double the old VND3,300 rate,” she lamented, adding that other fees for checking balances, transferring, and printing statements also increased twofold from VND1,650 to VND3,300.
“Why didn’t the bank issue any announcement on its fee increases?” she said.
Meanwhile Ha, a worker at Esprinta Co in the Binh Duong-based Song Thanh 2 Industrial Park, also said Techcombank did not post any announcements about the hikes in their two ATM booths in front of the industrial park.
“It’s inevitable that I will switch to using ATM machines of other banks as there are thousands of workers here whose salaries are paid via ATM cards,” she said.
Meanwhile, some banks have chosen to collect fees for on-us transactions, instead of increasing charges for interbank services.
BIDV, for instance, now charges customers VND1,100 for balance checking and statement printing transactions via ATM booths under its system.
On-us transfers are also subject to a VND2,200 fee per transaction, while it used to be free.
For its part Agribank collects a fee of 0.05 percent of the transacted amount on money transfers, while the minimum charge is VND3,300.
Agribank cardholders are also charged VND550 whenever they check balance or print statement at the ATM machine.
Ngo Ngoc Dong, CEO of Vietnam National Financial Switching JSC, or Banknet, said the fee increases or additions are the banks’ own policies, not the State Bank of Vietnam or the bank card alliance.
Dong said many banks have complained of the high expenses needed to invest in the ATM system, but the central bank’s view is that fee collection can only be done under a roadmap developed by the central bank, in a way that ensures that interests between customers and banks will be balanced.
Nguyen Tu Anh, CEO of Smartlink, said she is surprised by the news as banks had agreed at a recent meeting that ATM fees would not be adjusted this year.
She said the central bank has ordered the Payment Agency to develop a reasonable policy on ATM fees.
The agency, for its part, has finished the draft decree and is collecting feedback from relevant agencies.
The draft proposes that interbank transaction fees will be increased by an inconsiderable rate, while fees for on-us withdrawals will be only VND1,000 per transaction.
The fee collection is expected to be applied from either January or June, 2013.
Exports of fragrant rice hit record levels
The Vietnam Food Association (VFA) is hoping to export 600,000 tons of fragrant rice this year, 140,000 tons more than last year.
The Thai Government recently introduced a policy of subsidizing fragrant rice and the move has driven up fragrant rice price on the world market and made Vietnamese fragrant rice more popular with consumers as it sells at a more competitive price.
The country’s exports of fragrant rice rose from 216,000 tons in 2010 to 460,000 tons in 2011. Domestic rice businesses exported almost 230,000 tons of fragrant rice in the first five months of this year.
However domestic exporters of fragrant rice say that global demand for the product has not yet reached the levels it did last year.
Experts say that the global price of fragrant rice is being affected by a drop in the global price of standard rice and lower consumer purchasing power.
On top of this, the output of domestic fragrant rice is threatening the country’s overall rice export target, as the acreage of summer/autumn and autumn/winter fragrant rice being grown keeps falling.
To reach the target set for this year, the agricultural sector needs to encourage farmers to increase the acreage of autumn/winter fragrant rice they plant to ensure adequate export volumes, experts say.
Hong Kong and Taiwan are the major importers of Vietnamese fragrant rice, with Hong Kong accounting for half of the country’s total exports of fragrant rice.
Since the beginning of the year, Vietnamese businesses have opened up several new markets in Africa and Asia. An exporter in the Mekong Delta says that Asian countries always increase their imports of fragrant rice at the year’s end as demand soars during the lunar New Year festival, so he remains confident that more contracts for fragrant rice exports will be signed.
However, recently, a group of Chinese businessmen visited the Mekong Delta to source fragrant rice to export to China and they had asked their potential Vietnamese partners to mix equal amounts of fragrant rice and white rice together to raise profits.
The VFA is now calling on its members to ignore these requests and not to damage the prestige of Vietnamese rice or compromise its quality.
Hanoi to host major construction technology fair
The first International Exhibition of Construction Technology 2012 (Vietconstech) is set to kick off at the Viet Nam Exhibition and Fair Center in the capital on June 27.
Head of the Construction Ministry's State Authority for Construction Quality Inspection (SACQI) Le Quang Hung said the event aims to showcase modern technology in the fields of construction, consultancy, quality control, production as well as the provision of construction materials, high-tech equipment and software.
"It would be an opportunity to highlight the potentials and achievements of both domestic and foreign businesses in developing and applying technology to enhance construction quality," Hung said.
The three-day event will feature products from 80 enterprises, including the Vietnam Industry and Construction Group promoting roller compacted concrete technology for irrigation dam building, a Vietnamese-Russian oil and gas joint venture (Vietsopetro) pushing technology for oil and gas exploration rigs and Beton 6 displaying technology for building pre-stressed concrete roads.
Vietconstech will attract foreign exhibitors with technologies aimed at large-scale and complex construction such as Japan's Sumitomo Mitsui specializing in large-span bridges, Germany’s Bauer Company operating in foundation and large-size bore piles and IHI Infrastructure Systems who develops large-span flyovers.
Japan International Nuclear Energy Development Company (JINED) and SHIMIZU Corporation will introduce technical solutions for security and environmental safety in building nuclear power plant and subways.
The exhibition is expected to offer opportunities for co-operation as well as technology transfer between local and foreign enterprises.
The event will host conferences on "Technical Progress of Construction Technologies" as well as "Japanese Construction Technology, Policies, Experiences and Achievements" with the attendance of construction companies, State management officers and scientists.
Attendees will be able to approach, discuss and receive professional ideas for technical solutions and applications of scientific equipment to enhance project quality and cost saving.
Owners of $11.5-mln abandoned dock identified
A subsidiary of beleaguered Vinalines is one of three shareholders of the company that has purchased and left the US$11.5 million floating dock dormant in Cam Ranh Bay over the last four years, according to the Khanh Hoa Department of Planning and Investment.
Vinashin Cam Ranh holds a 10 percent stake in the joint-venture Nam Viet Maritime Service JSC, which was licensed for operation on March 19, 2009 with total registered capital worth VND120 billion.
The other two shareholders are the Vinashin Petroleum Investment and Transport JSC, or Shinpetrol, which has been transferred into the Viet Hai Shipping and Real Properties Corporation (VSP); and an individual who holds a 10 percent stake.
In 2010 Nam Viet Co sought permission from the provincial People’s Committee for its implementation of the Cam Ranh ship repairing project with an investment of VND294 million.
The project included the purchase of the Venture Dock 2 floating dock, which was built in 1999 by Indonesia-based P.T Naninda Mutiara-Batam shipyard.
However, the people’s committee turned down the proposal due to worries over pollution, which put an end to the project.
The Venture Dock 2 was imported to Vietnam by Long Son Co, who later sold the facility to Nam Viet Co under a $15.5 million deal.
The ill-fated equipment has been sitting on Cam Ranh Bay since August 2008, and is now rusted and severely deteriorated with several broken down parts.
According to a source close to Tuoi Tre, the contract stipulates that Long Son Co is to be held responsible legally for the floating dock.
Vo Huu Thang, deputy head of the supervising team of Khanh Hoa Customs Agency, said the deal in which the floating dock was sold is under inspection.
“If Long Son Co did sell the floating dock to Nam Viet Co, it will be deemed an illegal deal,” he said.
Garments top export list
Garment and textile exports are estimated to have earned US$6.6 billion in the first half of 2012, continuing to top the list of national exports.
The figure was released by Le Tien Truong, Deputy General Director of the Vietnam Textile and Garment Group (Vinatex) in a meeting in Hanoi on June 20 to review the sector’s operations.
Accordingly, the sector has maintained a stable growth rate in big import markets such as the US, EU and Japan.
Many exporters have achieved growth rates of more than 12 percent compared to the same period last year, including Phong Phu, Viet Tien, Hoa Tho, May 10 and Duc Giang garment companies.
Truong said Vinatex is currently completing equitisation and new market expansion to achieve its own target of US$2.6 billion.
The garment sector aims to rake in US$18 billion from exports this year.
Hanoi hosts ICT summit
The 2012 Vietnam Information and Communication Technology (ICT) Summit will be held in Hanoi on June 26- 27.
Themed “National Core Infrastructure”, the summit will promote the modernization of the nation’s infrastructure by applying information technology, to turn Vietnam into a modern industrialized country by 2020.
This year’s summit will also focus on applying ICT to deal with pressing social issues such as traffic jams and accidents, educational reform, development of smart cities, and electronic ID cards.
Vietnam among top 29 fastest growing economies
The Southeast Asian economy is projected to achieve a growth rate of 6.3 percent in 2013 and 6.5 percent in 2014 to rank 22nd among the 29th fastest growing economies in the world.
The result was released recently by Business Insider, a New York-based business/entertainment website, using the World Bank’s semi-annual Global Economic Prospects report.
Vietnam relies heavily on exports, with garments, crude oil, rice and machinery being major export items.
The Business Insider list also includes six other countries in Southeast Asia, 16 in Africa, 3 in central Asia, 2 in Latin America and one in the Middle East.
Among the listed countries, 9 are dependent on exports of crude oil, 5 on gold and diamond, 5 on farm produce, while 5 other economies are driven by tourism services.
Only three countries are in the group of 20 industrialised and emerging countries (G-20).
Andrew Burns, a WB official, warned developing countries of the difficult times ahead, as the world economy is not out of the woods yet.
HCM City CPI down in June
HCM City’s June Consumer Price Index fell by 0.43 percent against the previous month but increased by 6.01 percent year- one- year, the municipal Statistics Department reported.
It was the first reduction in 21 months, the department said.
Cultural and entertainment services, housing, electricity, water, fuel, garment, hat and other goods and services reduced in prices between 0.07 percent and 2.62 percent.
Prices of other commodity groups had a slight increase, with catering services gaining the highest growth of 1.18 percent.
In comparison with June last year, prices jumped 7.94 percent for catering services, 8.41, percent for education services, 7.8 percent for housing appliances and 8.67 percent for other goods and services.
Vietnamese retail market down in global rankings
Vietnam has been removed from the list of the most attractive retail markets, according to a recent report from A. T. Kearney, a US-based global management consulting firm.
Nation de-listed from most attractive retail markets
The report on the 2012 Global Retail Development Index (GRDI) shows that Vietnam has consistently dropped in the ranking, from its top place in 2008 to 23rd position last year, and it is no longer in the top 30.
Dr. Dinh Thi My Loan, Vice Chairwoman and Secretary General of the Vietnam Retailers Association, says Vietnam’s drop in the rating was due to a decline in revenue of the world’s top ten retailers, whose growth rates stood at only 1.6-1.8 percent at the end of last year as a result of high unemployment rates and the debt crisis in Europe.
According to a recent report from the Hong Kong and Shanghai Banking Corporation (HSBC), the domestic retail market, which was thriving in the past, is shrinking in the face of a sharp increase in fuel prices and rising production costs.
Loan says the problem is that most small-and-medium-sized enterprises (SMEs) find it difficult to access bank loans.
To help them through a hard time, Loan stresses the need to evaluate the impact of inflation and deflation on each local retailer, and the entire retail sector, from different angles in order to deal with the situation. For their part, Vietnamese retailers should be aware of what is impacting on the operational structure of the retail sector as well as the shopping habit of consumers, she says.
Loan suggests domestic retailers focus on reducing costs, managing risks and improving customer-care services, as well as building the brand names of their products through sales and marketing activities.
In addition to seeking new foreign markets, Loan says, Vietnamese businesses should devise marketing strategies and plans for their retail outlets, including large trade centres, major supermarkets, specialty shops and discount stores. They need to learn experience from successful retail models in other countries such as the Republic of Korea, Thailand and Indonesia which have developed many mini-supermarkets catering for local consumers.
According to Loan, smart retail marketing based on scientific research and advanced technology has led to the establishment of online shopping models and customer-care networks.
She reveals that VinatexMart, Vietnam’s biggest garment and textile agent, has opened nine new supermarkets nationwide since the beginning of this year, bringing its total number of supermarkets to 70. Other retailers such as Satra, Saigon Coop Mart, HaproMart, Intimex, Fivimart, Fahasa and Nguyen Kim electronics are also busy expanding their distribution networks for local retailers to achieve a steady growth in the near future.
Forum pushes trade ties with Italy
Nearly 50 Italian and Vietnamese firms yesterday attended a seminar to promote economic, trade and investment co-operation between the two sides in Umbria.
Speaking at the event, organised by the Vietnamese Embassy, Ambassador Nguyen Hoang Long said there has been a rising number of Italian businesses investing in the country as well as in other emerging markets.
He said that despite the ongoing economic crisis, the two countries were still actively strengthening bilateral relations, especially in the economy.
Tomaso Andreatta, a representative from Banca Intesa San Paolo in Southeast Asia, suggested Italian businesses invest in Viet Nam, saying that it was a potential destination with a favourable business environment and a gateway to help firms enter other Asian markets.
Andreatta named a number of successful projects in Viet Nam including Piaggio's motorcycle, Datalogic's scanner, Bonfiglioli's engine and Ariston's hot water heater production.
Dino Fortunato, investment and promotion expert at the United Nations Industrial Development Organisation (UNIDO), said his organisation had selected three potential Vietnamese sectors such as textiles, footwear and furniture to support.
In order to make co-operation commensurate with potential, Long urged Italy to support Viet Nam in technological training and apply preferential credit policies for doing business in the country. He said he also planned to promote the establishment of an Italy-Viet Nam training centre for local engineers and workers.
At the seminar, Vietnamese trade counsellor in Italy Bui Vuong Anh introduced the country's economic, trade and investment conditions in order for Italian businesses to have a clear map of action.
Anh said Viet Nam was negotiating to take part in the Trans-Pacific Partnership (TPP) Agreement, which will further ease Italian investment in the country.
Most firms lose in first quarter
About 70 per cent out of more than 250,000 surveyed businesses reported losses of over VND40 trillion (US$1.9 billion) in the first quarter of this year, the Ministry of Finance's General Department of Taxation reported.
Director of the department Bui Van Nam said the figure was based on corporate tax declaration papers gathered from 63 vicinities around the country.
He added that total costs accounted for 97 per cent of business turnover.
However, statistics will have to be double-checked due to some firms declaring losses despite profiting to avoid paying taxes.
Nam said the department would inspect around 8,000 enterprises and check-up on 56,000, 1.5 and 12.5 per cent of total 446,000 businesses, respectively.
"If we do mange to uncover tax fraud, we would co-operate with relevant agencies, such as auditors, in taking appropriate measures," he added.
Nam acknowledged that companies were facing difficulties and that Government Resolution 13 to reduce and extend tax payments has done much to counter the problem.
Ministerial calculations have shown that relevant support initiatives could reduce State budget spending by around VND9 trillion ($428 million), of which a part could be transferred to next year due to tax extension.
The department has focused on developing a taxpayer database and implemented e-payments across 41 localities and among 120,000 enterprises, Nam affirmed.
In time, it would be applied by an additional 200,000 out of 446,000 businesses across the country.
VN gets serious about customers
Most Vietnamese companies believe customer service is improving in the country, but 78 per cent believe international companies have an edge over them, a survey by market research firm Cimigo and ERC Institute Viet Nam has found.
Eighty per cent of the surveyed companies believe that customer service is a key part of their culture. However, less than a third have clear customer service metrics, and the majority fail to check with customers about satisfaction or benchmark themselves against competitors.
They said since customer-service training programmes do not receive importance in Viet Nam, it is difficult for them to improve their customer service.
Forty three per cent of the respondents have individual customer service targets, but only a minority add this to their training programme.
Few have schemes to reward employees for customer service.
A majority of the companies believe customer service is essential for international competitiveness, and that local companies need to focus on this critical area for their future growth and success.
The survey, which polled 291 companies in various sectors, was done in preparation for a seminar titled "Uplifting Service" to be held in HCM City on June 29 by ERC.
Seminar participants will discuss how to build strong relationships with both internal and external customers.
Furniture maker to issue cheap shares
Truong Thanh Furniture (TTF) has a plan to issue additional shares at a substantially discounted price in a bid to raise capital while avoiding high borrowing costs. The price for the issue would be set at just VND5,000 per share, half of the par value of the company's outstanding shares.
"This is quite an attractive price under current market conditions," TFF chairman Vo Truong Thanh told the publication Thoi bao Kinh te Sai Gon (Sai Gon Economic Times). If the price were higher, the shares would be unlikely to attract buyers, he said, noting that the low offer price would not harm existing shareholders.
"We have treasury shares valued at VND200 billion ($9.5 million) to cover the shortfall in par value," Thanh said.
Last year, the company's borrowing costs soared to VND234 billion ($11 million) in interest payments to banks.
"We really need a measure to increase cash flow and eliminate the great pressure of paying interest," he said.
Thanh also revealed that the share issue was the fallback plan if a deal with a Korean partner failed. TTF had been working with this foreign investor to acquire shares and bonds worth a combined VND150 billion ($7 million).
The current plan, if approved next month in a scheduled vote of company shareholders, was likely to net about VND90 billion ($4.2 million) in new capital, Thanh said.
TTF shares closed yesterday on the HCM City Stock Exchange at their ceiling price of VND7,900.
State Bank may decide foreign loan rates
While foreign bank branches and credit institutions generally negotiate lending and document trading interest rates themselves, the State Bank of Viet Nam will stipulate an inter-bank rate in case of unexpected developments.
This is in accordance with Circular No 21/2012/TT-NHNN dated June 18, which the SBV said it issued to meet development demand in the inter-bank market based on publicity, transparency, efficiency and security.
Transactions involving lending or valuable documents such as Government bonds, State Bank bills and bills of exchange are to be carried out via contracts and alongside provisional funds to counter risks related to such activities, the circular states.
Transactions must be implemented in under one year and through the main headquarters of branches or institutions with the aim to balance short-term payment abilities and capital sources.
The circular also requires credit institutions wishing to implement inter-bank transactions to be free of overdue debts of 10 days and above.
Major cities have CPI reduction
The capital's Consumer Price Index (CPI) fell by 0.17 per cent against the previous month but increased by 6.32 per cent year-on-year, the local Statistics Department reported yesterday.
Out of 11 commodity groups, housing, electricity, water, and building materials all fell by 1.86 per cent, followed by transport at 1.73 per cent, and food and restaurant services at 0.05 per cent.
The remaining groups, including soft drinks and tobacco, garments and footwear, home appliances, drugs, healthcare and other services, culture and entertainment, and education service increased. Garments and footwear took the lead with an increase of 1.35 per cent over the previous month and the other rose less than 1 per cent.
The gold price index in June decreased by 2.69 per cent from May, while the US dollar price index rose by 0.25 per cent, the department said.
Experts attributed the significant decline in food and restaurant services this month to the abundant food supply in the southern provinces. Several consumer goods such as clothing and summer footwear saw slight increases, while gas and petrol prices continued to suffer from reduced world figures.
Economists revealed that the CPI made a consecutive increase in the first three months but it started declining in April, thus bringing the price of all commodities down compared to previous months. Currently, the monthly average growth during the fist half this year is 0.42 per cent.
HCMC to promote safe fruits, vegetables in markets
Ho Chi Minh City has signed an agreement with the highland province of Lam Dong, the Mekong delta provinces of Tien Giang, Long An, and the southern province of Tay Ninh for the supply of more than 50 per cent of their produce of safe vegetables and fruits to the city.
In the past, the HCMC Department of Agriculture and Rural Development faced immense problems of acute food poisoning incidents after consumption of insecticide contaminated fruits and vegetables.
The department will now work with its counterparts in other provinces to crack down on excessive use of insecticides, and instruct and support fruit and vegetable growing establishments to strictly adhere to requirements set by the department for cultivating safe crops.
The department’s agriculture staff and their counterparts in the three provinces will closely monitor production and processing of fruits and vegetables on farms and proffer advice on use of pesticides and fertilizers in safe proportions.
In addition, the plan to grow and market safe fruits and vegetables has interested nearly 5,000 farmers in suburban districts, who are cultivating over a 2,800 hectare area, said Nguyen Van Duc Tien, head of the Department of Plant Protection. Many cooperatives in suburban districts provide more than 250 tons of safely cultivated cabbages to the city.
Regular monitoring is conducted on fields and at wholesale markets or supermarkets to help farmers’ change growing practices and minimise use of insecticides and chemical fertilizers. Farmers are gradually becoming aware of the damaging effects of chemical fertilizers on human health.
The City will work with wholesale markets and supermarkets to promote consumption of certified fruits and vegetable produced by establishments in the three provinces. These certified fruits and vegetables will get top priority to enter the three wholesale markets of Hoc Mon, Binh Dien and Thu Duc, and other supermarkets in HCMC; whereas uncertified produce will have to undergo at least a two hour wait for quality check.
A manager of Binh Dien Market said that besides price and quality, customers usually pay heed to food safety and hygiene.
Thanks to certified safe vegetables and fruits, the pressure to check produce during the wee hours of the night will be greatly reduced, as produce arrives in markets only at nights.
However, market managers and inspectors from the plant protection bureau sometimes conduct random checks on consignments of safe vegetables and fruits.
According to Tien, the program of buying safe vegetables from three new provinces will begin this September and the city will buy more than 80 percent of produce to stock its markets.
Le Thanh Liem, director of the Department of Agriculture and Rural Development, said the cooperation agreement to buy safe vegetables and fruit will ensure food safety and hygiene, and will help the city to implement safe agricultural practices as desired by the Prime Minister.
Southern region seen facing power shortfall in 2013-15
The country’s southern provinces do not need to worry about power blackouts from now to the year-end, but severe electricity shortages may hit this region in 2013-2015.
Nguyen Thanh Duy, general director of the Southern Power Corporation (EVN SPC), told the media on Tuesday that the southern power plants could not be switched on as scheduled to meet strong electricity demand in the region. Moreover, the two 500kV north-south power line is currently overloaded.
Vietnam Electricity Group (EVN) is developing the third 500kV line to transmit electricity from the north to the south. However, the project is facing financial distress and site clearance problems, so it cannot be finalized late this year as planned.
“EVN and the Ministry of Industry and Trade are weighing a contingency plan to cope with power shortages in the southern region from the dry season of 2013 onwards. The ministry expects to have the official information by this year’s end,” said Duy.
EVN SPC supplies power for 21 southern cities and provinces, excluding HCMC. In the first half of this year, EVN SPC has provided this region with some 17 billion kWh, up 13.15% year-on-year.
Binh Duong, Can Tho, Tien Giang, Binh Phuoc, Binh Thuan and Ben Tre are the biggest electricity consumers.
Regarding the 110kV undersea cable line running from Ha Tien to Phu Quoc, which will be developed under a deal signed between EVN SPC and Italy’s Prysmian PowerLink SRL, Duy said it would take about one year for the Italian contractor to produce the specialized undersea cable.
The 56-km undersea cable line worth around VND2.3 trillion will get off the ground in early 2014 and be completed in the middle of that year. Then, Phu Quoc Island will be connected to the national grid via the line.
Fuel retail price cuts expected on strong global fall
As world oil prices have been steadily falling over the past few days, local fuel wholesalers said they are ready for another bout of price cuts by the Finance and Industry-Trade ministries.
RON92 gasoline price in Singapore closed at US$101.6 per barrel on Monday, down by US$0.98 a barrel, or 0.96%, from the previous session. This is the lowest level since the end of last year and US$5 lower than the price recorded before the retail price cut of VND800 per liter on June 7.
Crude oil in foreign markets is also slipping, with spot Brent oil staying at US$94.61 per barrel on Tuesday, tumbling by US$0.97 against the preceding day.
Executives of a number of fuel wholesalers told the Daily that their firms are making profits as global oil prices have been going down in recent days.
The sales director of a southern petrol company said his enterprise could earn about VND1,200 from each liter of gasoline sold. But given the 30-day average global price, the profit will be less with only VND500-600 a liter for gasoline and a mere VND200-300 per liter for diesel, the sales director noted.
This is the right time for local authorities to consider another retail price cut with the condition that the high inventories at fuel traders as a result of slowing local demands must be taken into account, he stressed.
The sales volume of the company has decreased roughly 20% year-on-year over the past two months, with only 60,000 cubic meters sold every month compared to the monthly 70,000-75,000 cubic meters in previous years.
He said the competition among petrol wholesalers to offer high commissions to retailers has partly eased in line with global price falls and continuous retail price adjustments by the State. The discount level for one liter averages out at VND600-650, slipping by VND100-200 a liter compared to the days before the ministries pushed the retail price down in June.