Electricity prices to rise 7.5 percent from mid-March

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A worker repairs an electricity facility (Photo: VNA) Electricity prices will be increased by 7.5 percent to an average of 1,622.05 VND per kWh from March 16, as approved by Prime Minister Nguyen Tan Dung at a Government meeting in Hanoi on March 5. The Cabinet leader, his deputies, and the Ministers of Industry and Trade, Planning and Investment, and Finance agreed on the rise after considering price adjustment options proposed by the Ministry of Industry and Trade and the Electricity of Vietnam Group (EVN). The 7.5 percent increase will help EVN avoid and compensate for losses (about 8 trillion VND or 380.95 million USD at present) from exchange rate disparities in recent years. If the price of electricity is not adjusted, EVN’s losses would exceed 12 trillion VND (over 571.42 million USD) in 2015. Meanwhile, the price hike is also expected to help Vietnam achieve a GDP growth rate of 6.2 percent while reining in inflation rate at about 5 percent. On behalf of … [Read more...]

Foreign firms eye M&A deals as SOEs equitise

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Foreign direct investment into Vietnam via mergers and acquisitions is on an upward trend, underlining the growing appetite among foreign companies to acquire stakes in existing companies as the fastest way to strengthen their foothold in the country. According to the online market intelligence and finance news firm StoxPlus, 2014 recorded 265 completed merger and acquisition (M&A) deals with a total value of $4.6 billion. Inbound M&A into Vietnam was valued at over $3 billion in 2014, StoxPlus reported. This number accounted for just a seventh of total foreign direct investment last year, but represented a 64.9 per cent bounce on the disappointing $1.83 billion of inbound M&A recorded in 2013. "This is a growing global trend and Vietnam is no exception. This is one of the fastest ways to expand business in Vietnam, particularly when the nation is going to enter a series of free trade agreements like the ASEAN Economic Community, Vietnam-EU Free Trade Agreement and … [Read more...]

Social News 3/3

Passengers get refunds for long flight delays Airlines will have to refund fares and other charges to passengers of those flights at least five hours later than scheduled if requested, according to a new circular of the Ministry of Transport. Circular 81/2014/TT-BGTVT with effect from on March 1 regulates that airlines are responsible for providing passengers with full and updated information about their long-delayed flights, along with food and accommodation for the affected passengers. For flights postponed for two hours or longer, airlines must arrange appropriate flights for the affected passengers to travel to their destinations. In case of flights delayed for more than five hours, airlines shall refund fares and related fees to passengers. The circular also specifies that if flights are canceled, operators must announce the reasons and provide the affected passengers with accommodation and food. The number of delayed flights soared at this year’s Tet (Lunar New Year) … [Read more...]

Japan increases financial services in Vietnam

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VietNamNet Bridge - Japan is the second largest foreign investor in Vietnam with 2,494 projects as of January 20 and total registered capital of nearly $36.9 billion. However, since 2011, because of difficulties faced by the Japanese economy and the global recession, Japan’s investment in Vietnam has declined. Data by JETRO showed that, in 2014, 436 Japanese-invested projects were licensed in Vietnam, the lowest in three years. The total registered capital was more than $2 billion, less than half of the two previous years. In particular, the manufacturing sector, which accounts for the largest proportion in Japan’s investment in Vietnam, fell, with a reduction of up to 53 projects and nearly 30% in capital, from nearly $1.2 billion in 2013 to nearly $830 million 2014. Experts say that projects in the manufacturing sector require large capital, long-term investment and depend on market demand. Atsusuke Kawada, chief representative of the JETRO Hanoi Office, agreed, … [Read more...]

Outcome from the Resonance

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In 2014, Nghe An started a number of investment projects with a major impact on socio-economic development. That's the bright spot in the bleak picture of attracting investment of the country. This result is due to the direct attention of the Central and the continuous efforts of the provincial government in 2014 and earlier years. The main achievement is the result of the above factors, Nguyen Van Do, Director of Nghe An Planning and Investment Department, confirmed to Vietnam Business Forum. Ngo San reports.How do you evaluate the results of attracting investment in 2014? As of November 15th 2014, Nghe An province had granted and adjusted investment certificates for 127 projects with a total registered capital of VND27,384 billion, of which granting certificates to 105 new projects with a capital of VND18,522 billion and adjusted 22 projects to increase more VND8,862 billion. The highlight is that Nghe An had attracted capital in a large number of projects such as Dong Van … [Read more...]

Private firms race to take over State-owned enterprises

A corner of Nha Trang Port in the southern province of Khanh Hoa. After being transferred to the VinGroup Vinpearl JSC, the port will be transformed into a harbour with moorings for pleasure craft and cruise liners.

Major Vietnamese business people have geared up to take over State-owned enterprises, which were recently equitised, in the role of strategic partners. Thousands of billions of dong have been spent to buy stakes in State-owned enterprises in recent times, reports online vietnamnet.vn. Early this year, Chairman of T&T Group Do Quang Hien said that he is ready to pour more than VND490 billion (US$23 million) to buy a 98.02 per cent stake in Vietnam National Shipping Lines (Vinalines) at Quang Ninh Port. If the buying of the stake is successful, the port will be added to the list of Vinalines ports that are selling shares after equitisation. A year ago, Da Nang Port sold 13.2 million of its shares to five private domestic investors for a fairly high price, after several rounds of unsuccessful initial public offerings. In August last year, the VinGroup Vinpearl Tourism and Trading Joint Stock Company bought Nha Trang Port shares worth VND85 billion, or US$4 million. The amount … [Read more...]

Free trade agreements likely to challenge local companies competitiveness

Its "golden population" phase and other specific advantages can help Vietnam exploit well a slew of free trade agreements (FTAs), but there is zero room for complacency, experts and leading industrialists have warned. They say that the agreements are a double-edged sword that will open the domestic market up to stiff competition local firms are ill-equipped to face. The increased export opportunities also come with the challenge of meeting international standards, they add. Viet Nam has inked FTAs, bilaterally and multilaterally, with many countries and blocs like the European Union and the Customs Union of Russia, Belarus and Kazakhstan. It is also a party to the Trans Pacific Partnership (TPP) that is being negotiated by 12 countries in the Asia-Pacific region. A VNA report last Sunday quoted Le Phuoc Vu, Chairman of the Ton Hoa Sen Group, as saying the FTAs can yield sizeable benefits for Vietnam. "We are clearly seeing that the global integration trend has developed widely and … [Read more...]

FTAs likely to challenge local companies competitiveness

Its "golden population" phase and other specific advantages can help Vietnam exploit well a slew of free trade agreements (FTAs), but there is zero room for complacency, experts and leading industrialists have warned. They say that the agreements are a double-edged sword that will open the domestic market up to stiff competition local firms are ill-equipped to face. The increased export opportunities also come with the challenge of meeting international standards, they add. Vietnam has inked FTAs, bilaterally and multilaterally, with many countries and blocs like the European Union and the Customs Union of Russia, Belarus and Kazakhstan. It is also a party to the Trans Pacific Partnership (TPP) that is being negotiated by 12 countries in the Asia-Pacific region. Le Phuoc Vu, Chairman of the Ton Hoa Sen Group, said the FTAs can yield sizeable benefits for Vietnam. "We are clearly seeing that the global integration trend has developed widely and global investment capital is heading … [Read more...]

Cooking oil market starts to heat up

In addition to importing more cooking oil products, Vietnam's domestic cooking oil market is seeing growing competition between the new and experienced brands. The Vietnam Vegetable Oil Industry Corporation (Vocarimex), a cooking oil giant with four subsidiary companies and three associated companies, owns the largest chunk of market share in the domestic cooking oil sector. However, in view of its falling market share in the recent years, the corporation decided to sell 24 percent of its shares to Kinh Do Corporation (KDC) and 8 percent to VPBank Securities. The Kinh Do Confectionary Corporation recently spent some more 530 billion VND (24.9 million USD) to buy a 27 percent stake in Vocarimex, boosting its stake in Vocarimex to 51 percent. Accordingly, the KDC will support Vocarimex in distribution system development, brand name and technology. Vocarimex's market share increased from 50 percent to 95 percent during the 1994 to 2000 period, but fell to 90 percent in 2010 and … [Read more...]

Market value climbs in new lunar year

Vietnamese stocks continued to increase in value as the first trading session of the new lunar year closed on February 24. Total market turnover reached 1.47 trillion VND (70.3 million USD) on a total volume of over 88.56 million shares, as investors were confident with the market's prospects. On the Hochiminh Stock Exchange, the VN-Index gained 1.65 percent to reach 596.95 points. The market turnover of the southern bourse was 1.14 trillion VND (54.6 million USD) with a volume of over 62.8 million shares. Bank shares remained the focus of the trading session. The market saw a remarkable achievement in Vietcombank code (VCB) as it reached its ceiling price of 39,000 VND (1.85 USD) for trading total 179,000 shares at the market's close. Other bank codes, including the Bank for Investment and Development of Vietnam (BID), Vietinbank (CTG) and Military Bank (MBB), also raised their prices by between 2.16 and 4.49 percent, to 18,500 VND, 18,600 VND and 14,200 VND, respectively. … [Read more...]

Foreign investors encounter risks in real estate

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VietNamNet Bridge – The fall of the real estate market is not only a lesson for domestic investors but also foreign enterprises in Vietnam. In 2007-2009, the real estate market exploded. Foreign investors announced a series of million USD projects in Vietnam. With foreign labels, plus beautiful designs and new ways of marketing, these projects immediately attracted home buyers as well as investors. At that time, villas sold by foreign investors were priced tens of billion VND (millions of USD) and buyers had to queue to get one. However, the past is over and a new risky game has opened and even foreign investors have to reshape their strategies. Big estate projects in Vietnam have changed. Most recently, an investor from Malaysia, Perdana ParkCity has announced adjustment of phase 2 of its project in Hanoi, from a housing project to a housing-office for lease one. After adjustment, the population declined from 35,000 to 23,000 people, the land for housing reduced and the … [Read more...]

Space remains for local retailers in domestic market

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Consumers shop at a supermarket of Saigon Co-op in Ho Chi Minh City (Photo: VNA) Vietnam’s retail market has recently witnessed the emergence of numerous foreign businesses as they make acquisitions and expand operations. While some fear the loss of Vietnamese brand names, others believe there is still substantial room for local firms to develop. Thai billionaire Sirivadhanabhakdi’s retail conglomerate Berli Jucker last year announced its plan to buy all 19 supermarkets of Vietnam’s Cash & Carry wing of the Germany Metro AG for nearly 880 million USD, the biggest retail acquisition in Vietnam’s history. Metro Cash & Carry Vietnam generated more than 690 million USD in revenue in 2013. In late 2014, the Central Group of Thailand’s richest family, Chirathivat, declared that its Power Buy Company had purchased 49 percent stake in the NKT New Solution and Technology Development Investment JSC, which owns the Nguyen Kim electronic shopping centre … [Read more...]

Vietnamese businesses and integration targets in 2015

(VOVworld) – Vietnam’s international integration process has entered a new phase, with Vietnam continuing to open its market by joining more international economic institutions. Improving the competitiveness of Vietnam’s economy and that of Vietnamese businesses to make the most of the opportunities that integration might bring about has become an urgent task. Anh Huyen comments: Economists forecast that Vietnam’s economic growth will pick up its pace and Vietnam will become an attractive investment destination this year. Vietnamese businesses, most of which are small or medium-sized, have made thorough preparations to improve their competitiveness. The government has devised solutions to aid domestic businesses in achieving sustainable growth in the future. Improving businesses’ competitiveness Businesses play an essential role in each nation’s development but they depend largely on the effectiveness of state governance. The government has issued … [Read more...]

FDI: Does it really benefit all of Vietnam?

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(VOV) - Although foreign direct investment (FDI) has created many jobs and stimulated competitiveness for local businesses over recent years, many citizens have raised concerns that its benefits have not been evenly distributed nationwide. Though it is generally recognised that FDI has been an important driving force for economic growth in the large metropolitan areas such as Hanoi and HCM City, legitimate questions linger about its quality and whether or not it has been equitably distributed to benefit the rural areas of the nation. Dr. Nguyen Mai, President of the Vietnam Association of Foreign Invested Enterprises recently said it was time for an objective, scientific assessment of foreign investment and a careful analysis of whether the nation is on the best course. According to his analysis, at present, 67% of exports over the past year were generated from the country's FDI. Additionally, those exports contributed significantly to the nation’s US$2 billion trade surplus … [Read more...]

Nation’s position and strength create promotion for new development tasks

A weaving line at Thai Tuan Group Corporation (Photo: SGGP)

Socioeconomic conditions have been clearly improved for the latest recent years with Gross Domestic Product (GDP) growth increasing quarter by quarter and year by year. However several hindrances are still in need of removal to promote Vietnam's position and strength for further achievements and development this year. Last year, GDP continued 2013's growth momentum to reach 6 percent, exceeding the norm for 5.8 percent. Industrial production strongly recovered with the Index of Industrial Production (IIP) hiking 7.6 percent, it was only 5.9 percent in the previous year. They were due to interest rate reduction, tax cut and incentives, public investment increase and inventory clearance. Notably, inflation was curbed at 1.84 percent, the record low for the last 14 years. Global economic conditions developed complicatedly. The EU fell deeper into recession, conflicts in Eastern Europe and the Middle East had no way out, and counter-terrorism fight became hotter sending the world … [Read more...]

Regional linking-an impetus for Phu Yen provincial outreach

The groundbreaking ceremony for Vung Ro oil refinery factory project

From being an agricultural province with agricultural proportion accounting for nearly 60% of GDP, more than 80% of households living in agriculture, in recent years, the socio-eco situation in Phu Yen province has been comprehensively developed, with remarkable breakthroughs in industry, services, tourism and offshore seafood-exploitation. In order to become an industrial province by 2020, in 2015, the province continues to promote regional links, implement solution groups for attracting investment, developing human resources, stabilizing social security, improving people's lives ... Currently, Phu Yen province has had over 2,000 active-businesses, three industrial parks attracting 71 investment projects from domestic and abroad with a total registered capital of more than VND 2,100 billion and USD19 million. The projects put into operation has created jobs for thousands of local workers. In particular, Southern Phu Yen economic zone is concentrated to deploy the … [Read more...]

Hong Kong, Vietnam firms join hands in $100mn realty project

Hong Kong-based Hamon Investment Group Pte Limited and Son Kim Land will collaborate in implementing the Gateway Thao Dien project in District 2, according to

An Asian investment management firm and a Vietnamese property developer signed Thursday a joint venture agreement on the development of a multimillion-dollar realty project in Ho Chi Minh City. The Saigon Times Online. The project, to be developed on a 10,940 square meter area, consists of four towers, according to a plan posted on Son Kim Land’s website. The towers will be managed in accordance with a five-star standard by Hamon Developments, a Hamon Investment Group subsidiary, according to the Vietnam News Agency. Hamon Developments is the investor and developer of the luxury Nguyen Du Park Villas in District 1. The total investment for the project is more than US$100 million, The Saigon Times Online quoted Nguyen Hoang Tuan, chairman of Son Kim Land, as saying. Tuan refused to elaborate on the specific stake of each party in the joint venture, but revealed that the disparity between the investments is inconsiderable. The project will be introduced to the market … [Read more...]

U.S. firm explores more power projects

The Saigon Times Daily The plans were revealed during a recent inspection trip of Deputy Prime Minister Hoang Trung Hai to the thermal power project invested by AES Corporation with an interest of 51%, South Korea’s Posco Energy Corporation with 30% and China Investment Corporation with 19%, according to Vietnam News Agency. In 2014, AES expressed keen interest in participating in more power projects in the country. Last September, the corporation inked a memorandum of understanding with the government of Quang Ninh Province to develop Quang Ninh 3 thermal project. The corporation is expected to find the site for the new power project later this year and has worked with the Ministry of Industry and Trade over the scheduled time for the power plant to come online. The corporation has plans to invest in local power enterprises subject to equitization in the coming years. The Deputy PM said Mong Duong 2 was the first BOT power project in Vietnam and AES’s … [Read more...]

Catfish king ready to hook exports on free trade deals

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Workers process fillet from catfish in Faquimex company in BenTre province, situated in the delta of the Mekong River in Vietnam. Hung Vuong Corp., which supplies frozen catfish to Wal-Mart Stores Inc. and Spain’s Mercadona SA, will sell a company stake and spend at least $100 million this year to expand production as Vietnam prepares to sign trade deals. Vietnam’s largest catfish exporter will build a $30 million Alaskan pollock processing plant in Russia in April and seek an Indonesian partner to expand catfish-feed production overseas, Chairman Duong Ngoc Minh said. He also plans to sell as much as a fifth of the company to a foreign strategic partner. The company forecasts it will double revenue to 30 trillion dong ($1.4 billion) by 2017 and boost exports to at least 80 countries as Vietnam works to sign the Trans-Pacific Partnership accord and a free-trade deal with the European Union. "We have been restructuring our production to get ready for Vietnam’s … [Read more...]

Vietnam’s outward FDI: Is the tide turning?

(VOV) - As of the end of 2014 Vietnam has turned the tide on foreign direct investment (FDI), or at least it seems, with outward FDI approaching US$20 billion, according to the Foreign Investment Agency (FIA). Although Vietnam’s cumulative outward FDI is still small compared to many countries around the globe, it is growing at a faster rate than most countries, particularly those in the Southeast Asian region. It is being sent to all parts of the globe. The top five countries in recent years have been Cambodia with 23 projects, Myanmar at 16, Laos at 13, the US at 12 and Singapore at 9. In total Vietnam businesses have invested in a grand total of 109 projects in 28 nations, the FIA said, adding that in 2014 alone they committed to an additional US$1.047 billion in 109 projects and disbursed roughly the same amount. As of the end of 2014 Vietnamese investors had disbursed total outward FDI of US$6 billion, which equates to 30.0% of the total of pledged outward FDI of US$20.00 … [Read more...]