BUSINESS IN BRIEF 5/4 Binh made the affirmation in “We think that issues in the two countries’ trade relations should be considered in a fair and objective manner in line with the spirit of trade liberalisation as well as the developing bilateral economic-trade ties,” he stated. Under the DOC’s decision, announced on March 31, Vietnamese frozen tra fish fillets exported to the Accordingly, the anti-dumping duties on products of two mandatory reviewed companies, Vinh Hoan and Hung Vuong, are 0.03 USD per kilo and 1.2 USD per kilo respectively, and for other companies it is 0.42 USD per kilo.- This reflects the international community's acknowledgement of In the times ahead, the Vietnamese government will continue providing explanations of its market economy to several partners, including the Under the commitments to the World Trade Organisation, PVEP starts producing oil commercially in Peru The PetroVietnam Exploration and Production Corporation (PVEP) began producing oil commercially from Block 67 off the coast of Block 67 is PVN’s second project in Earlier, PVEP negotiated with Perenco, an oil exploration and production group, to buy 52.6% of Perenco Peru Limited’s shares. The holding permits PVEP to earn 50% of profits from Block 67. Initial oil output from Block 67 is 6,000 barrels a day, which will be shipped to a station 600km away to sell. At an April 1 ceremony in Luis Ortigas Cuneo, Chairman of Peru’s national oil and gas group PeruPetro, said this is the first time in 40 years a foreign joint venture has exploited oil fields in According to the General Department of Customs' statistics, this amount comprises 53 per cent of Among Invest ASEAN: Foreign companies keen on Vietnam More than 100 foreign financial organisations showed their interest in the Vietnamese market during their working sessions with the country’s businesses on the sidelines of the “Invest ASEAN” conference held in A representative from the Bao Viet Group said that many major corporations, including France’s BNP Paribas Management Partners bank and Leaders of Vietnamese businesses all agreed that the conference offered a venue for investors to meet and seek partners. John Chong, CEO of Maybank Kim Eng Group, said that Invest ASEAN drew 70 companies from six ASEAN member countries - It also saw the participation of representatives of corporations from 17 countries with a total market capitalisation of 135 billion USD as well as funds totalling over 14 trillion USD in assets under management. The event aimed to enhance investors’ awareness and understanding of the investment potential in ASEAN as well as spur investments into the region. President and CEO of Malaysia’s Maybank Group Datuk Abdul Farid Alias expressed his optimism at Agriculture trade complex for The Ministry of Agriculture and Rural Development and the Korean Pan Asia Co., Ltd. are jointly studying the model of an agriculture wholesale and trading complex for The ministry will coordinate with the Industry and Trade Ministry and the General Association of Agriculture and Rural Development to modernise the distribution system of the seafood and farm produce in the capital city. Equipped with IT auction system, the complex is expected to reduce the go-betweens in trade to create bigger bring economic efficiency for local farmers, and help stablise the market prices for their produce. It is also hoped to supply quality goods for the 2019 Asian Sports Festival, and benefit exports via the remote auction system with the Additionally, the Cold Chain System linking with the complex will be built to better the frozen food and materials distribution network. A master plan for this project is scheduled to complete within this year. Deputy Minister of Agriculture and Rural Development Hoang Van Thang highlighted the Memorandum of Understanding on the complex signed between the ministry and President of Pan Asia Huh Sul during his March visit to Thang added that the company has also inked a similar document with the General Association on cooperation in the management and operation of the complex and human resource training.- Cambodia legislature passes investment protocol with Vietnam The National Assembly of Cambodia on April 3 ratified a protocol on the investment promotion and protection agreement between the governments of All 64 parliamentarians of the ruling Cambodian People’s Party (CPP) in the National Assembly approved the document. Mok Mareth, Chairman of the Commission on Investment, Agriculture, Rural Development, Environment, and Water Resources at the National Assembly, said the document aims to enhance investor confidence and facilitate investment between the two countries. Sok Chenda Sophea, Secretary General of the Council for the Development of Cambodia, said the protocol will help maintain, promote and facilitate investment ties between the two neighbouring countries. The Association of Vietnamese Investors in Strong FDI poured into HCM City’s IZs in Q1 Foreign Direct Investment (FDI) poured into the According to the HCM City Export Processing and Industrial Zones Authority (Hepza), it granted investment licenses to 12 new FDI projects with a total registered capital of 223.2 million USD during the period, up more than 8 times compared to the figure of the same period last year. Meanwhile, nine ongoing projects of this kind in the City raised their existing capital by 20.34 million USD. Internal capital inflow to the zones in the period reached almost 713.3 billion VND (33.91 million USD), registering a year-on-year increase of nearly 65 percent. The City also granted investment licenses to eight new projects in the period. Hepza has to date licensed 1,293 projects with a total capital of over 8 billion USD, of which 514 are FDI projects worth 4.935 billion USD. In the second quarter, Hepza plans to assist the This year, the southern economic and business hub aims to attract 2.5 billion USD in FDI capital, which is 20 percent higher than last year's figure. Last year, it drew in 2.08 billion USD in FDI. Nation on target to hit GDP growth target The country’s economic growth will improve in the next quarter and the 5,8% GDP growth target will likely be met thanks to the Government’s measures to increase aggregate demand, according to the National Financial Supervisory Committee. Growth will improve next quarter in the wake of an interest rate cut and Government bond investment increase that support aggregate demand, the committee said, adding that GDP is expected to continue rising for the next three quarters after a 4.96% surge in Q1. The 4.96% growth rate was higher than the same period of the past two years thanks to the recovery of the agriculture, forestry, fishery, construction and industrial sectors. After a long decline that lasted from the beginning of 2011 until Q2 last year, GDP has steadily increased. Improved results were also seen in the macro-economy, the committee said. The manufacturing and processing sector has risen since Q2 last year and continuously improve 7.3% year on year in Q1 while the country’s Purchasing Managers’ Index (PMI) reached 52.1, pointing to a fifth consecutive monthly improvement in business conditions in the sector- the second strongest in the survey’s history, just shy of the record achieved in April 2011. High export growth in Q1 also contributed to the optimistic forecast. The country gained a trade surplus of more than US$1 billion in Q1, the highest level since 2010. Inflation was also controlled at only 0.8% in Q1, the lowest rise since 2005. The inflation slowdown led to interest rate cut that helped credit growth and eased firm’s difficulties. However, the committee noted that aggregate demand improvements remained slow. Excluding inflation, the retail sale value of goods and services in Q1 rose only 5.1%, not much higher than the rates of 5% in Q1 2012 and 4.5% in Q1 2013. To meet the GDP growth target, the committee recommended that in addition to economic restructuring for long-term growth, the Government should pay attention to supporting aggregate demand, boosting consumption and aiding farmers and businesses through interest rate cuts and bank credit access. It was also necessary to speed up the disbursement of investment capital from the State budget and Government bonds, the committee said. ADB warns of widening economic divide in Asia Impressive economic gains in Nearly 750 million people in the region still survive on less than 1.25 USD a day, while income inequality has risen more than 20% in the last 20 years. These levels hinder further economic advancement and even threaten the sustainability of an otherwise sharp reduction in poverty, according to a just-released study on ADB’s Support for Inclusive Growth by Independent Evaluation at the Manila-based financial institution. Development organisations such as ADB, for their part, can step up efforts to integrate inclusive growth into their development strategies, says the study. ADB adopted inclusive growth as a strategic agenda in 2008, and seeks strong progress in making it an operational reality, it says. “Inclusive growth is more than a desirable goal. By tapping the contribution of the lower-income groups as well, it becomes an essential ally for sustaining growth itself,” says Vinod Thomas, director general of Independent Evaluation. A part of the problem is that lower-income groups have inadequate access to basic services in health care, education, or safe drinking water and sanitation. Case studies from At the same time, overall growth has failed to translate into similar improvements in average living standards. One of the indications that growth is not reaching a broad enough segment of the population is relatively weak household consumption. According to the study’s estimates, household consumption grew 5.7% annually in the 1990s in the region and 5.5% in the 2000s, well below gross domestic product growth of 9.0% and 8.2% in the two decades. This is troublesome for countries attempting to expand domestic consumption as part of efforts to raise their economies to new levels of development and bring the benefits of growth to more people. “Eliminating poverty in the region remains a major piece of unfinished business. Growing first and addressing social inclusion later does not seem appropriate any longer,” says Hyun Hwa Son, the principal author of the report. The new report calls for efforts to forge better coordination and synergies among development organizations. It also pays to tailor inclusive approaches to the specific contexts and needs of countries because one size does not fit all. There is a clear need to go beyond simply financing projects, and toward integrating inclusion objectives into the design and selection of projects and country programs. “Economic growth alone is not sufficient to improve people’s welfare: we need complementary measures to help translate growth into commensurate improvements in living standards. The best way to do that is to include progressively lower-income strata in the growth process,” says Thomas.- VN-Index earns second best performing index This has been reported by Zero Hedgean economic and finance website. The website has taken Bloomberg data to make its own charts of best and worst performing indexes. Accordingly, the VN-Index of According to the website, Q1 winners are mostly from the Middle-Eastern countries, including In December 2013, it put Vietnamese stocks in "the best longs for 2014", along with gold and gold shares, and forecast that the local market would continue to go up. On April 3, the VN-Index gained 7.77 points, or 1.34 percent, to reach 589.44 in Travel expo looks to sustainable tourism development Vietnam International Travel Mart (VITM), the leading travel event for the country, kicked off in This is the second time the Vietnam Tourism Association (VITA) in coordination with the Ministry of Culture, Sports and Tourism and At the opening ceremony, Deputy Prime Minister Vu Duc Dam called on ministries, departments, associations and the Vietnamese public to join hands to develop a domestic tourism trademark and transform He affirmed that the event contributes significantly to the development of sustainable tourism in the country, acknowledging that the sector has made strong progress in achieving sustainable tourism in recent years, despite the global economic slowdown. The number of foreign arrivals to the country grew by more than 29% in the first quarter of this year and its turnover increased by more than 30%. People in countries throughout the world, including VITA Vice Chairman Vu The Binh said the fair is expected to attract around 3,000 companies seeking cooperation partners and around 50,000 consumers desirous of purchasing promotional tours and services. The fair includes attractive consumer promotions with aviation agents offering 15,000 tickets costing from VND199,000 on international routes and VND330,000 on domestic routes, and travel agents offering 8,000 promotional tours with a 60% discount. Officials, scholars and businesses of the International Organisation of Francophonie (OIF) began a two-day forum in In his opening speech, Vietnamese Deputy Minister of Foreign Affairs Ha Kim Ngoc noted that with 77 member countries and governments and a population of more than 800 million, Francophonie is not only an important force in dealing with international hot issues, but a populous and dynamic community facing all the challenges and difficulties common to Vietnam and other nations in the Asia-Pacific Region. He expressed hope delegates will evaluate the impact of the global economic slowdown on member state economies and set course for the community, to help Francophonie develop an economic development strategy for the Asia-Pacific region – one of the most dynamic regions in the world. Anissa Barrak, an OIF representative in the Asia-Pacific region, noted from its inception, economic cooperation has and continues to be the hallmark of the rich, vibrant and multi-faceted Francophonie community. Anissa briefed participants on the activities of the community, such as teaching the French language, strengthening scientific research, improving judicial capacity, and running vocational training courses. She spoke highly of the ASEAN dynamic economic region in the international economic cooperation arena, especially the four Francophonie members – Both Anissa and Ngoc expressed their conviction that delegates at the forum will bring fresh, creative and dynamic ideas for developing a comprehensive and much improved Francophonie community. The two-day forum will address four main topics spanning improving the efficacy of the Francophonie economic strategy, specific characteristics of Asia-Pacific region and its impact on Francophonie economic strategy, sharing experience in economic cooperation, and closing ceremony. Greece-Vietnam business council debuts in Athens A business council has been established in Among distinguished guests at the debut ceremony were Panagiotis Mihalos, Secretary General for International Economic Relations and Development Cooperation under the Greek Ministry for Foreign Affairs, and Vu Binh, Vietnamese ambassador to In his address, Mihalos welcomed the establishment of the Greece-Vietnam Business Council (HVBC) as a significant contribution to the strong and long-term development of bilateral economic ties. He expressed hope the two sides will work closer together to facilitate economic development in their respective countries. At its first session, HVBC elected Constantinos Antonopoulos, CEO of Intralot Group - a Greek company that supplies integrated gaming and sports betting management, as its president. Despite The meeting comes on the heels of the high-profile Japan Transportation Consultants, Inc. (JTC) scandal in which JTC was alleged to pay several Vietnamese transport officials JPY80 million in kickbacks in return for an ODA project in Vietnamese and Japanese representatives exchanged ideas, and dilated on the differing types of abuses of ODA funds that can potentially occur and the specific control measures to be deployed to detect and deter them. They agreed that enhancing transparency is one of the strongest measures that needs to be given effect in combating corruption along with a number of other practical measures. There was also consensus that the measures should be timely implemented in the near future to restore confidence in the ODA funding mechanisms in They agreed to hold another meeting pending results of the ongoing investigation into the JTC scandal. Deputy Minister of Transport Nguyen Hong Truong revealed that the Prime Minister has authorised Deputy Prime Minister Nguyen Xuan Phuc to officially take charge of Small and medium enterprises (SMEs) from The meeting was held after the freshly concluded fifth round of Free Trade Agreement (FTA) negotiations between Delegates agreed The meeting garnered great interest of the business communities from both sides, as it provides an opportune occasion to lay the groundwork for future bilateral trade and investment after the FTA is signed. Vietnamese Minister of Industry and Trade Vu Huy Hoang briefed Hoang extended an open invitation to citizens of Many Vietnamese people speak the Russian language and this is an effective tool for people-to-people exchange, Hoang said. Anhia, a representative from a travel agency which often conducts tours of A He said he believes the problem can be ameliorated through dialogues and business exchanges, and hopes Vietnamese tea thrives in the marketplace of Phan Van Tuan, President of Lya Group and President of the Overseas Vietnamese Association in Hung Kings Fair attracts over 200 businesses More than 200 domestic organizations and businesses are attending the 2014 Hung Kings Fair which was opened in the northern midland On display are different kinds of high-quality products, including household utensils, interior and exterior decorations, electronics, garments, fashions, agro-forestry and fisheries products, processed food, fertilizes, handicrafts and agricultural machines. The fair offers participating businesses the chance to promote their products, seek partnerships and expand domestic markets. It also responds to the campaign “Vietnamese people buy Vietnamese goods”. The fair, held by the Phu Tho provincial People’s Committee in collaboration with Ministry of Industry and Trade, is part of the 2014 Hung Kings Festival. French textile enterprises ready for Vietnamese cooperation French textile machinery manufacturers desire to establish long-term mutually beneficial relationships with Vietnamese businesses. Evelyne Cholet, Secretary General of the French Textile Machinery Manufacturers Association (UCMTF), was speaking at a seminar in She said that French enterprises want to become In the fiercely competitive world market place, French enterprises still assert a competitiveness edge and have found an important niche in the market thanks to technological innovation and quality improvement, she added. For her part, Deputy Minister of Industry and Trade Ho Thi Kim Thoa said The Vietnamese Government always creates the most favorable conditions for textile enterprises to expand their operations, and continues to increase investment in weaving and dyeing technologies. She proposed that the Vietnamese and French business communities make the best of experience exchange and technology transfer to increase the added value of Over the past 10 years, In the first quarter of this year, it grossed more than US$4.54 billion from export, a year-on-year increase of 20%. Freelancers look at work from a fresh perspective Following a three-year stint at various marketing and advertising agencies in "You don't have to belong to a major agency to be creative," said Vinh, who graduated from the With about four years as a freelancer under his belt, the 30-year-old has done creative ads, websites, promotional materials, newsletters and graphic designs for about 30 clients ranging from non-profit organisations to health and fitness centres. "The great thing about being a freelancer is that you get to choose your clients, decide on the quality of your work and pitch your ideas directly," he said. Vinh is a member of But the challenges facing freelancers are also abundant: gaining the trust of clients, having on-time payments, meeting deadlines or dealing with projects that could turn upside-down. Seeing such demand to connect freelancers with potential clients, in mid-2013, Tran Ngoc Tuan, an IT freelancer from Tuan now employs a team of seven people to run the site, where freelancers can create their profile and clients can find those with suitable skills. Tuan said the site does not charge anyone and he claims already there are about 7,000 users. "Most freelancers were previously skilled professionals, not untrained hopefuls," he said. "I think this generation is looking for something newer and more challenging rather than just working at a company and waiting for promotion." According to Tuan, freelancing mostly appeals to those who previously worked as writers, photographers, consultants, website developers, programmers or copywriters, because basically these kind of works allow you to work on your own. "The financial stress and lack of networking skills are the two biggest hurdles for those who take on the risks of freelancing," Tuan added. At the same time that youngsters in many countries are facing tighter job markets, freelancing could be a sustainable and profitable career, said Evan Tan, regional director for "The young grew up with the Internet and see the vast potential of not just networking with people but also looking for niches where they can earn money," Tan said. "This is a growing market with a lot of potential." A recent report released last week by the Ministry of Labour, Invalids and Social Affairs and the General Statistics Office suggests that, at the end of last year, there were about 72,000 people with some kind of college degree out of work. Therefore, "those who have the guts to drop full-time jobs must prove they have something special to offer," said Pham Xuan Quy, a 25-year-old freelancer who specialises in organising events. "Working as a freelancer does not mean you can sleep until noon. That is not what this is about. You have to wake up at the same time as your client and work to build up your skills and brand." He is also part of a network that is called freelancerviet.vn, which connects freelancers with clients. Since being launched in September 2013, founder Pham Lan Khanh from Ho Chi Minh City said the total value of freelancing projects on the site had reached 1.5 billion VND (70,500 USD). Khanh said some freelancers could not handle the financial stress and instability of working on their own and eventually returned to work as full-time office workers. So she and other co-founders frequently organise meetings in both "I believe that in the next two or three years more people will become engaged in freelance work due to the development of technology - and an economy that is becoming more digitalised as more businesses learn more about cost-cutting." Jason Lusk, co-founder of ClickSpace, a community centre for freelancers in the West Lake area set up in March last year, agrees that the trend is taking off in Vietnam. Many foreign freelancers are also coming here and they need to find Vietnamese collaborators. ClickSpace holds a monthly meeting called Hanoi Freelancers Meet-up, which attracts on average about 40 people per session, according to Lusk. Quy admitted that in Experts urge Vietnamese firms to build online profiles Just 20 percent of Vietnamese companies have registered international and local internet domain names, and the lack of web-based exposure could hurt other firms in the future, experts said at a seminar on March 28. The seminar, held in the northern coastal city of According to the VNNIC, only 20 per cent of 500,000 companies in VNNIC deputy director Tran Minh Tan said internet domain plays an important role in business operations now as it helps companies advertise themselves in the cyberworld. "Nowadays, the success and fall of a company can partly be due to the way they do business in the internet world. I think Vietnamese businesses should consider the Internet an important part of their operation," Tan said. The centre informed the seminar that over 90,000 new ".vn" domains were activated last year, bringing the total number of national domain names to 263,900. The increase has helped the country keep its number one position in Among these, domains with Vietnamese names accounted for 127,166, said the centre, which functions under the Ministry of Information and Communications. The VNNIC said it earned revenues of 143 billion VND (6.8 million USD) from domain activation and subscription fees in 2013, exceeding its annual target by 15 percent. According to the Ministry of Information and Communications, internet service providers (ISPs) in Vietnam earned 15 trillion VND (more than 714 million USD) in revenues last year, with 5 trillion VND (238 million USD) coming from 3G network services. Between 2009 and 2013, the number of internet users increased by 170 percent, and broadband availability climbed 7.5 times compared with 2005-09. The number of internet users is expected to reach 60 million by 2018, and total revenue from internet services and content is expected to climb to 100 trillion VND (4.7 billion USD). UAE tops phone importers' list The United Arab Emirates (UAE) is the biggest importer of Vietnamese phones and phone accessories, with growth of over 100 percent year-on-year since 2010. According to the Ministry of Industry and Trade, Vietnamese cellphones to the UAE reached export turnover of 71 million USD in 2010, then jumped to 364 million USD in 2011, 1.5 billion USD in 2012 and more than 3 billion USD last year. In a report released on March 28, the General Department of Vietnam Customs' online news site, www.baohaiquan.vn, quoted a department figure as saying that the UAE had paid nearly 520 million USD to import Vietnamese phones in the first two months of this year. The figure represented over 81 percent of total UAE import turnover from Also, according to the report, the export value to the UAE accounted for more than 15 percent of total Vietnamese phone export turnover in the first two months of the year, when The other major importers of Vietnamese phones in the first two months were the US with a turnover of over 284 million USD, Germany 184 million USD, the UK over 182 million USD, Hong Kong nearly 140 million USD, Russia 140 million USD, and Italy 120 million USD. Last year, the UAE was the biggest importer of Vietnamese phones. Import value was 3.2 billion USD, accounting for 16 percent of Vietnamese phone and accessory export turnover, and representing 83 percent of the UAE's total import value from The other main products that the UAE imports from Reform committee claims success in enterprise transformation The National Steering Committee for Enterprise Reform and Development helped reshuffle 101 state-run businesses in 2013 and privatise six others in the first three months of this year. The figure was released during the committee’s meeting on March 28 to review its operations in 2013 and the first three months of this year. According to a report at the event, the committee helped speed up the submission and issuance of 24 legal documents on the re-organisation and restructuring of state-owned enterprises. Addressing the event, Deputy Prime Minister Vu Van Ninh, head of the committee, said in 2013 and the first three months of 2014, the committee recorded a strong performance. It proactively coordinated with other agencies to help the government and the Prime Minister adopt proper policies on the re-organisation and reform of enterprises, he added. He also asked ministries to reconsider a number of matters, including the salary management in joint stock companies using state capital, the accounting mechanism in state-owned firms, and the re-organisation of agro-forestry businesses to enhance their operational efficiency. In the remaining nine months of this year, the committee will continue assisting ministries to submit proposals to the government and the Prime Minister on the issuance of policies, Deputy PM Ninh said. He urged the Ministry of Information and Technology to promulgate organisational and operational regulations for the Vietnam Post and Telecommunication company, and the Ministry of Finance to review the financial management of major groups, including the Oil and Gas Group and the Vietnam Electricity. He also directed the committee to inspect the restructuring of ministries, sectors and state-run economic groups and corporations.- A business cooperation programme, funded by the Danish International Development Agency (DANIDA), will raise its support towards Since 1997, the programme has donated more than 74 million USD to 300 pilot projects and over 150 long-term partners in Ambassador John Nielsen expressed his belief that the programme, together with other business support tools of the Danish agency, will contribute to reducing the number of local people living in poverty and boosting the country’s sustainable development. The Danish Government and its businesses have been providing Vietnamese partners with knowledge in the fields of food safety and clean technology. In the time to come, DANIDA will focus on supporting the country to see it grow in a more sustainable manner. This process will include green technology transfer, job generation and environmental improvement. Of the amount, 5.4 million USD is funded by the Asian Development Bank (ADB), and the remainder from the local budget. The project is being carried out between 2009 and 2015, aiming at the sustainable production of vegetables and tea, generating jobs for the agriculture sector, improving farmers’ health and productivity, and developing biogas for their daily use. It is also expected to zone off areas for organic agriculture production in five communes in the capital, build infrastructure and equip farmers with cultivation techniques. CBRE: HCMC office rents to remain stable The real estate services firm has been tracking 175 new small and medium-sized mixed use commercial buildings in the southern economic hub, said Greg Ohan, national director for office services at CBRE Vietnam. Half the buildings are being built by State-run companies and 50 per cent are ready to be occupied. Ohan said the tracking fund helps large tenants planning for an occupancy solution and that the market would remain tight until the end of 2014. “As a result, rent levels will remain stable until at least the first quarter next year when the next wave of supply comes online.” In the first quarter this year, only one new Grade B office building is slated to be finished in the city. The MB During 2013, unlike the Hanoi market where Grade A office supply continued to rise, particularly in outlying districts, the Ho Chi Minh City market was stable with limited new Grade A and Grade B office supply in both the CBD and further districts, Ohan said. According to CBRE, the southern market offers few options for multinationals seeking international standard and quality buildings with large availability until the year-end. The reason is that in the CBD, just seven Grade A buildings and three Grade B buildings are able to provide 1,000 square metre spaces at adjacent levels. In particular, the As for last year’s leasing, the tracking fund showed the top five most active sectors were technology, manufacturing, finance, education, and retail. When it came to countries, Lotte Coralis receives security award Le Jong Kook, general director of Lotte Coralis Lotte Coralis The award demonstrated the appreciation of the Hanoi Public Security Department had for the efforts by officials, contractors, security forces and workers in protecting public security and order to ensure construction safety, not only in the area of their Lotte Centre building but also in surrounding areas. Leaders of Hanoi Public Security Department also encouraged the staff to keep trying, striving, thus establish many achievements that contribute to the development of Lotte Centre started construction at the end of 2009 and has undergone more than 11 million hours of labour safety with no accidents. It is expected to be completed by the end of June 2014. Once finished, World Bank experts share experiences with affordable housing The country’s strategy, however, should be analysed carefully to avoid slums like other cities, experts have warned. According to Victoria Kwakwa, World Bank country director in “This growth is expected to generate enormous new housing demands, especially in the low and middle income segments due to large scale rural-urban migration,” said Kwakwa at a seminar held in Kwakwa said Vietnamese authorities should better define and understand the housing deficit for poor urban households – the bottom 40 per cent or those below the median income. “In this context we believe it is important to also consider the housing conditions of migrants, not only those of officially registered residents. It will also be important to think of ways of formalising those living in informal settlements. “Given the rate of rural to urban migration and the fact many new arrivals to the city work in the informal sector, there is a risk that informal settlements may grow rapidly. By addressing the issue of informality in the housing sector head-on, Responding as to why the housing sector in “This mismatch suggests market failures in the housing sector. It is important to understand the causes of these market failures,” she added. In countries where there is ample relatively affordable housing across income strata, the role of governments she said must be to ensure a level playing field for market participants with specific assistance provided to the poorest households. “When governments focus on the enabling environment, resources from the private sector can be better leveraged to create a sound and sustainable housing sector,” she said. Abhas Jha, sector manager of Urban, Disaster Risk Management and Transport, East Asia Pacific under the WB said that to avoid slumps, the government can proactively enable affordable housing without direct provisions by improving the land market and increasing accessibility and mitigating risk. “Planning must be part of the integrated, long-term, risk sensitive land use and transportation planning,” Jha said. Moreover, affordability should be considered including a range of interrelated expenditures, not just the cost of a housing unit, he added. Construction Minister Trinh Dinh Dung said Vietnamese people have a high demand for accommodation but house prices are much higher than average income. “Therefore, making houses affordable requires support from the government and even international organisations,” Dung added, noting that housing is determined as a priority in socio-economic development policy until 2020 with a view to 2030. As such, a series of legal documents have been issued to support the development of the social housing market, notably the low interest VND30 trillion ($1.41 billion) loan package aimed at homebuyers and property developers. The thing Vietnam must do first and immediately is increase the supply of affordable housing to disburse the above package from the government and therefore provide more and more affordable housing. The second thing that must be done, Dung said, is continue reviewing the law related to this issue to transfer the package to the right receivers as soon as possible. Vietnam has the goal of building 10 million square metres of social housing, mainly apartment buildings, by 2015 to meet low-income earners’ demands. It will provide support for 400,000 poor families in rural areas in need of houses. Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR |
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