BUSINESS IN BRIEF 13/9 Market info will be richly available at export forum Business information about potential export markets will be richly available at the 2014 Export Forum this Friday in HCMC, with trade counselors from several countries coming to answer enterprises’ queries, said the organizer. The Export Forum is the annual event organized by the HCMC Investment and Trade Promotion Center (ITPC) to assist enterprises in exploring potential export markets, and identifying trends and requirements of markets they want to penetrate. According to ITPC, its discussions with business associations and corporations in preparation for the forum showed that textile, garment, footwear, woodwork and seafood enterprises are boosting exports to traditional markets such as the In particular, textile and garment enterprises also eye markets that are to join the Trans-Pacific Partnership (TPP) and want to promote exports to ASEAN countries. Meanwhile, in addition to increasing exports to the ASEAN market, woodwork enterprises said they would seek ways to bolster shipments to Eastern Europe and the Due to many changes in the EU market, The In addition to the Ho Xuan Lam, deputy director of ITPC, said the organizer was aware of markets local enterprises are targeting at, so it has invited to the 2014 Export Forum representatives of foreign trade offices, Vietnamese trade counselors abroad and foreign counselors in Difficulties local enterprises encounter and their proposals will be reported to the Ministry of Industry and Trade, the HCMC government and relevant agencies, Lam said. Sectors like textile, garment, footwear and woodwork are growing well but supporting industries are still inadequate, and thus enterprises will not be able to make the most of new trade agreements Vietnam is about to sign. Besides, information about free trade agreements Representatives of relevant agencies and fuel trading firms in HCMC have met to discuss ways to boost the sale of E5 bio-fuel at more filling stations here in the city. There are around three months left for the city to widely distribute E5 as told by the Government, but only 29 out of 504 pumping stations retail the bio-fuel. Some traders have had no station selling this fuel since 2010. A report by the HCMC Department of Industry and Trade showed that since a pilot scheme for selling E5 was initiated in October 2010, a mere 29 filling stations citywide have been selling E5. Local fuel trading firms have pledged to put into service 29 more E5 filling stations towards the year-end, bringing the total number to 58. In fact, a number of fuel trading firms in the outlying districts of Hoc Mon, Can Gio and Cu Chi have had to shut down their E5 pumps due to losses in the past four years. Fuel trading firms are now awaiting the Ministry of Industry and Trade’s detailed instructions about a road map for E5 distribution in December to know if distributors and agents get any support and whether the price mechanism of E5 is different from that of other fuel products or not. According to petroleum wholesalers, the selling of E5 is costlier than the standard A92 petrol and they cannot force agents to sell E5 if agents make little profit. Le Ngoc Dao, deputy director of the HCMC Department of Industry and Trade, said the department would continue asking the ministry to issue a guiding document on specific mechanisms and support for firms selling the bio-fuel. Fuel trading firms said E5 should not be available together with A92 gasoline at the same station because retailing different types of fuel would make it costly to equip extra gas pumps. Dang Vinh Sang, general director of Saigon Petro, said the company and other wholesalers wanted E5 to be sold like what However, the department questioned if fuel trading firms are able to supply sufficient E5, but no fuel traders could answer that question at the meeting as they have yet to know the real demand for E5. The department targets to have one or two filling stations selling E5 in each district towards the year-end. EVN says extra 700MW for national grid this month Vietnam Electricity Group (EVN) said it would be putting into operation the second generator of Vinh Tan 2 thermal power plant and the first generator of Song Bung 4 hydropower project this month to supply an additional 700MW for the national grid. Besides new generators put in place, EVN will make the most of operational hydropower, and coal- and gas-fired power plants in September to ensure power supply for southern Earlier this year, the first generator of Vinh Tan 2 Thermal Power Plant in EVN plans to sign an engineering, procurement and construction (EPC) contract for the extended Duyen Hai 3 Thermal Power Plant this month. This US$870-million project has an initial capacity of 600MW and is scheduled to generate electricity from 2019. Duyen Hai 3 is one of the three power projects located at the Cashew firms decry shortage of material Domestic cashew processing companies have found themselves in hot water as many foreign crude cashew suppliers have failed to make deliveries as contracted, prompting a shortage of material for processing. The Vietnam Cashew Association (Vinacas) recently said many international raw cashew suppliers did not observe the delivery schedules specified in the contracts, or the quantity and quality of shipments are not aligned with signed agreements. Parties made deals when crude cashew prices were low. Therefore, foreign exporters had a tendency to cancel contracts to avoid losses at the time of delivery as prices climbed sharply. Vinacas is now waiting for reports about the shortfall of cashew compared to the signed contracts from its members. In a written request sent to domestic businesses, this association also asked for the names of discrediting cashew exporters to make a black list to warn the business community worldwide. According to the Ministry of Agriculture and Rural Development, In January-August, The seven-month export price of cashew nuts averaged out at US$6,438 per ton, rising 1.4% year-on-year. The Nam Con Son Gas Pipeline Company on September 9 conducted a drill to fight a leak on its gas pipeline around 300 kilometers off the coast of Hoang Minh, general director of Nam Con Son Pipeline Company, told the Daily that the national energy security could be seriously undermined if any incident hit the gas pipeline. Therefore, the company has practiced the drill simulating a real gas leak to ensure the safety of the pipeline. Minh recalled a gas leak on the gas pipeline system in August last year. However, the operating unit of the company had promptly fixed it within 48 hours owing to the available process of activating the emergency response system. Energy experts noted that if the Nam Con Son gas pipeline had any unexpected supply interruption, Vietnam Electricity Group (EVN) would be forced to resort to oil to generate power with a cost of VND400 billion a day. The Nam Con Son gas pipeline with total investment of US$1.3 billion is now jointly operated by PetroVietnam Gas Corporation with a majority interest of 51%, Russian oil firm Rosneft with 32.67% and Anglo-French company Parenco with 16.33%. The gas pipeline conveys 22 million cubic meters of gas onshore a day to supply gas-fueled power plants that are responsible for one-third of the nation’s electric power output. Draft investment law bans 11 business areas The latest draft law on investment sent to the National Assembly (NA) Standing Committee for discussion on September 9 lists 11 prohibited business areas compared to eight banned areas in the earlier draft. In fact, there are only two more business areas added to the prohibition list: trading of cultural products jeopardizing national security and breaching social morality; and trading of counterfeit and toxic products harmful to human lives and health, except for products listed in the conditional business areas. Meanwhile, the banned area of human trafficking and prostitution mentioned in the initially proposed list is now split into prostitution business and trafficking of humans and human organs. The updated draft only suggests banning trading of GMO animals instead of GMO products in general as proposed earlier, which means production of genetically-modified plants such as corn can be approved. Eleven business areas which are to be banned include: - Trading of military weapons and equipment; specialized military and police vehicles; military equipment for the armed forces; specialized components, parts, accessories, equipment, specialized technology to produce such items, except for ones produced on the State’s orders; - Trading of drugs prescribed in Appendix 1 of the law, except for the use for analysis, testing, scientific research, medicine, criminal investigation under the provisions of the State; - Trading of chemicals in Table 1 in accordance with the international conventions in Appendix 2 of the law; - Trading of firecrackers, except for signal flares, toy crackers under the provisions of the State; - Prostitution business; - Trafficking of humans and human organs; - Trading of wild plants and animals mentioned in Appendix 1 of the Convention on International Trade in Endangered Species (CITES), endangered, rare plants and animals of Group 1 mentioned in Appendix 3 of the law; - Activities related to human cloning; - Trade in GMO animals; - Trade in cultural products jeopardizing national security and breaching social morality; - Trade in counterfeit and toxic products risking human lives and health, except for products listed in the conditional business areas portfolio. Dairy industry focuses on tech, product diversity Vietnamese dairy firms are stepping up investments in technology and manufacturing facilities to diversify their products and enhance quality to meet the consumers’ rising demand, heard a seminar in Hanoi on September 9. Vu Ngoc Quynh, general secretary of the Vietnam Dairy Association (VDA), was quoted by Vietnam News Agency as saying “the local dairy industry has made remarkable breakthroughs in terms of processing and cow breeding technologies.” He was speaking at the seminar on development and diversity of dairy products for public health co-organized by VDA and the Vietnam Association of Food Science and Technology in Many dairy plants comparable to the world’s advanced dairy facilities have been established in Vinamilk has also built another plant producing powdered milk for children with an annual capacity of 54,000 tons a year. It is also equipped with a closed automatic production system meeting international standards. Statistics of the Ministry of Industry and Trade showed that powered milk output increased by nearly 5.5% in the year’s first five months compared to the same period last year. Meanwhile, the national herd is expected to increase to 240,000 dairy cows next year and 400,000 in 2020. However, he said although Vietnam is a dairy exporter, the local dairy consumption remains lower than in South Korea, Japan and other regional nations. Figures recorded last year indicated that every Vietnamese consumed an average 51 kilograms of milk while a Japanese person consumed more than 81 kilograms. This is one of the reasons behind the malnutrition of the Vietnamese people as seen in their height far lower than the average in Nguyen Quoc Khanh, executive director of Vinamilk, said the company has policy to aid dairy farming households in breeding dairy cattle and build large-scale and modern farms with thousands of cows. It also has a number of dairy farms meeting GlobalGAP (Good Agricultural Practice) located in the provinces of Nghe An, Lam Dong and Tuyen Quang. One-stop customs mechanism planned by year-end National Single Window, a one-stop customs mechanism, is expected to get into full swing in December this year as part of the Government’s moves to simplify customs procedures for enterprises. As scheduled, the ministries of Finance and Transport will prepare for the one-stop customs mechanism to come online this November. In the initial stage, only certain registration procedures for ship arrivals and departures will be applied. The electronic administrative system will be connected to the ministries of Finance, Transport, and Industry-Trade in the first phase to be implemented until the end of 2014 before other ministries and agencies. Enterprises will be allowed to send their files to the system so that ministries and agencies can process them online and issue licenses in line with relevant procedures and approvals by participating agencies. Earlier, Deputy Prime Minister Vu Van Ninh, head of the national steering committee for the one-door customs mechanism, signed Decision No.56/QD-BCDASW assigning duties to relevant ministries and agencies in preparation for the launch of the system in December after informing businesses of their connections to the system. The new mechanism enables individuals and organizations involved in import and export activities to submit information and standardized documents to only one address. Initially, it will be implemented on a pilot scheme for the import, export and transit of cargo and transportation means in accordance with the Customs Law. Belgian region keen to promote investment in Vietnam A seminar was held in During the fair, speakers described With many advantages, Belgian Ambassador to Vietnam Angelet Bruno emphasised that economic relations between Mr Ralph Moreau, Economic and Trade Counsellor for the Flemish Region from Flanders Invest & Trade (FIT) said Lawyer Luong Van Ly, Adviser and Head of Investment and Trade Desk of VLT Lawyers introduced participants about This year, Tokyo Keiki launches new factory in High-Tech Park Japan based Tokyo Keiki Precision Technology on September 10 inaugurated a US$40 million 30,000 sq metre facility producing high tech electromagnetic switching valves and high pressure pane pumps in the central city of Danang. General Manger of Tokyo Keiki Technology said the company decided to invest in Danang as a result of sound relationship between The company will expand market share in developing countries in a bid to meet growing demand for hydraulic equipment, he noted. Minister of Construction urges more low-income housing Minister of Construction Trinh Dinh Dung has asked contractors to prioritise invests in low-income housing projects, as 90% of citizens can only afford the homes in this sector. According to Dung, even though these domiciles are listed as homes for low-income people, they are the only residences within the reach of most Vietnamese citizens. He said that 90% of citizens have a need for apartments costing less than VND15 million (USD714) per square metre. "We still can't meet the huge demand. There are still many poor families in the cities and in the industrial zones. I once saw a five-member family living in a 16-square-metre house," he added. Dung proposed that local authorities in On September 9, the minister, along with the authorities of Hanoi People's Committee, conducted inspections of several social housing and dormitory projects. The minister showed his approval with the quality and suggested that contractors also provide furniture at low cost. Nguyen Ngoc Tuan, vice chairman of Hanoi People's Committee, said However, Deputy Minister of Construction Nguyen Tran American investors fired up over TPP A wave of American investments is hitting According to the 2015 ASEAN Business Outlook Survey of American Companies recently released by the American Chamber of Commerce in In addition, 62 per cent of respondents in US-backed agricultural firm Dekalb Nguyen Viet Ha, managing director of the Expected to be clinched next year, the TPP is a multilateral free trade pact between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US, and Vietnam. Once signed, the pact will cover almost 40 per cent of global gross domestic product. Under the TPP, all tariffs for exported agricultural products would be reduced to zero per cent, if 70 per cent of the products are sourced from TPP members. Kevin Gardner, senior director of Walmart Global’s International Corporate Affairs, told VIR that Walmart was a strong advocate of the TPP negotiations which could greatly benefit it in the Vietnamese market. “This comprehensive trade agreement provides market access and will bring a wide range of Vietnamese goods and agricultural products to consumers in our key retail markets in the US, Canada, Mexico, Japan, and Chile,” he said. Also under the survey conducted in May and June, Specifically, 41 per cent of respondents select Some 66 per cent of respondents expected profits to increase in The Ministry of Industry and Trade’s draft decree on managing beer production and consumption contains many unrealistic and infeasible regulations that need to be either amended or omitted, local brewing companies said at a conference on Tuesday. Vietnamese brewers were invited by the ministry to the event to give feedback on the draft decree, which aims to ban beer sales on the sidewalk and to people under 18 years old, as well as pregnant and lactating women. The ministry has also proposed forcing beer companies to place stamps on their products to fight counterfeits, warn drinkers of alcohol abuse, and prevent tax evasion. The draft document was announced early this month and immediatelygreeted with objections from brewers, beer vendors, and drinkers, who say it lacks feasibility. The ministry thus held the conference in Nguyen Van Viet, chairman of the Vietnam Beer Alcohol Beverage Association, said it is impossible to tell whether a woman is pregnant or breastfeeding and refuse to sell beer to her. “We should not put things we cannot control into a decree,” Viet said. “This should only be stated in educational or warning documents.” Lu Bang, from the Department of Industry and Trade in the central coastal city of Bang, however, showed support for the ban on sales to people under 18, saying this is “necessary for a civilized society.” $75.31 million to stamp beer products Meanwhile, Vu Xuan Dung, deputy general director of the Hanoi Beer, Alcohol, and Beverage JSC, blasted the regulation on stamping beer products as “too costly,” adding that no country forces producers to place warning labels on liquor products. Given that a stamp costs VND160, the total expense for stamping every unit would be VND1.6 trillion (US$75.31 million) a year. “If a regulation is costly and ineffective, we should consider whether or not applying it is a good idea,” he said. Nguyen Tien Sy, deputy head of marketing of the Saigon Beer-Alcohol-Beverage JSC, calculated that stamping its products would cost the company VND800 billion ($37.65 million) a year. “This will greatly affect our salary fund and social costs,” he said, adding that it could also “create a market for fake stamps.” Trinh Thi Hang Nga, head of the legislation department under the Ministry of Transport, said she wonders how regulatory agencies would detect breaches of beer regulations and enact sanctions on the violators. After hearing feedback from the delegates, Phan Chi Dung, head of the Light Industry Department, the main composer of the controversial draft decree, rejected the notion that banning sidewalk beer sales is impossible. “Some localities, such as Dung added, however, that the regulation “will be reconsidered and may be omitted.” As for the beer stamp regulation, the official said that citing large beer production is a weak argument, as cigarettes, whose annual production is around four billion packs, are currently stamped. “We will report this to the government, and will enforce the regulation if it is green-lighted,” he said. Ethanol fuel to go available nationwide next year Ethanol gasoline blend or bio gasoline E5 will be mandatorily used in seven provinces and cities of The seven provinces and cities include Gasoline E5 is a blend of five percent ethanol and 95 percent traditional gasoline, said Dr. Pham Huu Tuyen from the Hanoi University of Technology. The bio gasoline helps increase engine power, reduce fuel consumption and exhaust fume emission. It has already been used in developed countries, aiming to protect the environment, he said. In The Ministry of Industry and Trade has proposed the Government to reduce some fuel tariffs and fees, aiming at lower E5 gasoline price and demand stimulation of the new fuel. Eight more enterprises receive customs preference Eight more companies have been granted priority enterprise status by the General Department of Customs (GDC), giving them preference for customs procedures over other companies. The companies include Samsung According to the GDC, these companies will be entitled to huge advantages including simplified customs procedures, quick customs clearance, reduced charges, and increased business efficiency. GDC Deputy Director General Hoang Viet Cuong said the priority enterprise programme reflects a change of mindset, from considering enterprises as those to be administered, to regarding them as partners. Cuong said the GDC would expand the programme in the coming period to also include logistics firms. So far the GDC has granted priority status to 24 enterprises and is planning to raise the total to 30 by the end of the year. Local steel firms concerned about Russian imports Steel companies in The VCUFTA is one of more than 10 bilateral and multilateral FTAs which In previous rounds of negotiations, the parties concerned agreed on the general structure of the FTA and its implementation roadmap. Due to little principle difference, Chu Duc Khai, vice chairman of the Vietnam Steel Association, said Vietnam is ready for competition from various sides but the competitiveness of local enterprises are still weak and are not at the same level although their production scales have been improved over the past years. The local steel industry has seen supply far surpassing demand while many new projects will be put into operation soon, make competition among local steel makers stronger. Therefore, they will face hefty challenges if many FTAs are in place while authorities have not given timely support. The association has been concerned about steel imports from When tariff barriers between Khai clarified that the steel industry will not ask for a protection mechanism but a tariff reduction roadmap in five or 10 years. Besides, it is necessary to calculate the list of steel products subject to tax incentives. The Ministry of Finance during the six rounds of negotiations suggested that the steel sector enjoy a tax rate of 0% right after the FTA takes effect and other sectors get tariff exemptions after a maximum of five years. Meanwhile, Experts said tariff reductions for those products are being made gradually under the effective FTA between Visiting Speaker of the Assembly of the Union of Myanmar Thura U Shwe Mann on Sunday called on Vietnamese firms to strengthen investment and trade ties with At a meeting with the Association of Vietnamese Investors in Myanmar (AVIM) on Sunday during his official four-day visit to As many as 56 Vietnamese businesses have received investment certificates to do business in These projects included Hoang Anh Gia Lai Group’s complex of hotels, apartments and offices worth US$440 million and Anh Sao Viet Pharmaceuticals Corporation’s drug making facility worth US$23 million. Tran Bac Ha, board chairman of Bank for Investment and Development of Vietnam (BIDV) who also serves as AVIM chairman, hoped to raise the association’s investment in AVIM members at the meeting proposed the The association also hoped Established under an initiative by BIDV, AVIM comprising of 76 members such as PetroVietnam, Vietnam Airlines, Hoang Anh Gia Lai Group and Song Da Corporation has sent nearly 5,000 Vietnamese businessmen to Processors to be forced to sign contracts with shrimp growers Shrimp processing enterprises will have to own shrimp farms with output accounting for at least 10% of their capacity and secure contracts to buy unprocessed shrimp from farmers if a new shrimp farming and processing management plan is approved. The Vietnam Directorate of Fisheries is gathering comments on the plan aimed at better managing shrimp farming, processing and export in the Mekong Delta region. As explained by the directorate, it is urgent to devise such a plan to fully tap shrimp resources and change shrimp farming practices to reduce risks in environment, diseases and market volatility. The directorate calculated there had been nearly 596,000 hectares under shrimp farming in the Mekong Delta as of last year, nearly 91% the country’s total. Tiger prawn made up over 580,000 hectares. Shrimp bred in brackish water in the region reached 431,570 tons, including 133,500 tons in Ca Mau Province, 85,630 tons in But the volume can meet only 60-70% of the designed capacities of shrimp processing plants in 13 localities in the Mekong Delta as shrimp supply depends much on factors such as farming season, disease and the gap between shrimp processing capacity and farming. Enterprises have no choice but to count on imports of unprocessed shrimp. In fact, there are few seafood enterprises able to develop their own material areas and in deals to buy shrimp from farmers. Many other firms purchase unprocessed shrimp from intermediaries. Therefore, the directorate has drafted requirements for processing plants to have shrimp farms capable of meeting 10% of their capability in the plan. They will have to buy the remaining shrimp for their processing from farmers in line with contracts signed between the two parties and certified by competent administering agencies. VietGAP (Good Agricultural Practices) standards will be applied to all shrimp farms in the Mekong Delta region as required in the scheme, which is expected for adoption from 2015 to 2020. Bilateral trade with Total trade turnover between Urrutia was speaking at a workshop on free trade between the two countries in Ha Noi yesterday. Bilateral trade reached $560 million in 2013, 55 per cent in favour of The Ambassador said that when he first arrived in 2010, the volume was only $334 million, 69 per cent in favour of According to statistics from the Chilean Trade Commission, known as ProChile, between January and May this year Chilean exports to This was a trade increase of 19.2 per cent compared to the same period last year. A Free Trade Agreement that took effect on January 1 created new business opportunities for both sides and made it easier to access other markets within each region. The agreement covers more than 9,000 products. For The FTA is focused on the trade of goods, leaving negotiations about services and investments to a second stage. According to the agreement, ProChile statistics of export turnover of Chilean goods to Compared to The capitalisation of "In these particular markets, we expect to grow at a rates over 20 per cent in goods that exclude copper," said Rivera. The workshop was organised by the Embassy of Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR |
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