Business in brief 03 Jan 2013
Prime Minister Nguyen Tan Dung has approved a development strategy aimed at raising the level of national reserves to 1.5 percent of GDP by 2020. Under the strategy, Vietnam’s national reserves are expected at 0.8-1 percent of GDP by 2015. Key commodities are related to socio-economic security, natural disaster adaptation and rescue work, national security and defense, and epidemic prevention and control. By 2015, Vietnam will have about 500,000 tons of rice, 500,000 cubic meter of petrol, and 700,000 tons of crude oil in store. The level of national reserves will be adjusted depending on the real situations in the following years. The strategy emphasizes the need to apply modern preservation technology to ensure the quality and quantity of reserved goods and protect the environment.
Ho Chi Minh City is set to achieve a GDP growth rate of 9.5-10 percent in 2013 while stabilizing macro-economy, controlling inflation, boosting production and generating more jobs. The target was announced by the municipal People’s Committee at a meeting on January 2 to review socio-economic development and budget spending in 2012 and work out orientations for 2013. HCM City’s GDP grew by 9.2 percent in 2012, nearly double the country’s average rate despite a number of shortcomings in dealing with real estate projects, inventories, and bad debts. The focus of discussion was on facilitating production, promoting consumption, reducing inventory levels, as well as tightening the financial and monetary market to achieve US$4,000 worth of GDP per capita and reduce the rate of unemployment to less than 4.8 percent in 2013.
Malaysia has levied anti-dumping taxes on Vietnam’s Biaxially Oriented Polypropylene (BOPP), as per a state agency under the Vietnamese Ministry of Industry and Trade. The taxes, ranging from 10.41% to 21.43%, are imposed by Malaysia’s Ministry of International Trade and Industry (MITI), and effective between December 24, 2012 and April 22, 2013. This is, however, only a temporary sanction the MITI is applying for Vietnam and four other Asian countries. Earlier in July, Malaysia initiated an anti-dumping investigation into BOPP imported from Vietnam, Taiwan, Thailand, China and Indonesia in the time span from January 1 to December 3, 2011. The inspection was launched after the plaintiff San Miguel Yamamura Plastic Films Syndicate said the Malaysian BOPP industry was suffering serious economic damage from foreign dumping activities.
Vietnam-India trade turnover has risen to US$4 billion from US$178 million ten years earlier. The figure was released at a business meeting held in the central city of Danang on January 3 by the Indian Embassy in co-ordination with the Vietnam Chamber of Commerce and Industry (VCCI), the Indian Chamber of Commerce (ICC) and the Indian Business Chamber in Vietnam (INCHAM). The event is part of activities in the framework of the Vietnam-India Business Forum to mark the 40th anniversary of bilateral diplomatic ties and the 5th anniversary of the establishment of bilateral strategic partnership. India is currently one of top ten foreign investors in Vietnam, with a total trade turnover in the first ten months of 2012 reaching US$3.2 billion.
Yamaha Corporation, a manufacturer of musical instruments, has decided to establish a sales subsidiary in Vietnam for musical instruments and audio and visual, or AV, products. Previously, Yamaha has relied on import agents in Vietnam to manage the sales of its products there, but, going forward, the new subsidiary will be in charge of marketing Yamaha products and operating Yamaha Music Schools. The subsidiary, Yamaha Music Vietnam Company, Limited, is scheduled to begin operations in April 2013. And the new company is to be located in Ho Chi Minh City, Vietnam.
Since its establishment six years ago, the Chan May- Lang Co Economic Zone in the central province of Thua Thien-Hue has attracted 32 investment projects, capitalized at VND35,474 billion. They include 10 foreign direct investment projects valued at VND21,000 billion. Of the total, 12 projects have been put in operation. Besides offering investments incentives, Thua Thien-Hue has invested more than VND1,733 billion in building transport, electricity and water supply, communication and other social infrastructure to give the Chan May- Lang Co EZ a facelift. With a total area of 27,108 ha, the economic zone houses the Chan May deep-water port (668,5ha) and the Chan May urban center (3,441ha). It has completed construction of a USD$ 875 million Laguna tourism area invested by the Singapore Banyan Tree group and a 10,000 cubic meter fuel depot under the Petrol Vietnam Oil (PV Oil).
Air Astana, Kazakhstan’s national flag carrier, yesterday officially launched a direct route linking Almaty, the country’s largest city, and HCM City, with two flights set to make the journey every week, on Wednesdays and Fridays. A 160-seat Boeing 757 will leave Tan Son Nhat International Airport in HCM City at 13:00 and arrive at Almaty International Airport at 19:50 Vietnamese time. There are also two flights from Almaty to HCM City via Bangkok (Thailand) on Wednesdays and Fridays. Vietway Aviation Services is Air Astana’s official agent in Vietnam, in charge of ticket sales and promotion.
Only one-fourth of companies in Hanoi paid corporate income tax to local State budget in 2012, resulting in the capital city’s budget revenue falling short of the year’s target, according to Hanoi City’s Tax Department. The taxman said the number of enterprises reporting taxable income is small, just 21,508 out of 81,592 registered entities, accounting for 26%. Statistics of the department show that the tax volume recorded in 2012 was VND17.71 trillion, just equivalent to 86.7% of the 2011 amount. The year 2011 saw 23,508 companies reporting taxable income, making up 34%. In 2012, there were 46,787 enterprises or 57% reporting losses, rising 9.4% against the 2011 figure of 42,451 entities. The loss amounted to some VND43.9 trillion, up 4% over about VND42 trillion lost in 2011.
Haiphong surpassed Hanoi and HCMC to take over the second spot in foreign direct investment (FDI) attraction in 2012. As of end-December 2012, Haiphong had lured US$1.16 billion in FDI, only after Binh Duong Province with US$2.53 billion, as reported by the Foreign Investment Agency under the Ministry of Planning and Investment. The latest data of the Haiphong Department of Planning and Investment, however, reveals that the city attracted US$1.23 billion of newly-registered and additional FDI in the whole last year. Around 95% of this sum, or some US$1.2 billion, was poured into Dinh Vu-Cat Hai Economic Zone and the city-based industrial parks, said Mai Xuan Hoa, deputy head of the Haiphong Economic Zone Authority (HEZA).
The Ocean Bank and PetroVietnam Finance Corporation have bought a total of 1500 bonds worth VND1.5 trillion (US$72.12 million), issued by the city if Da Nang. The five-year-term bond, with a fixed interest rate of 11 per cent per year, is to raise funds for the construction of shopping and trade centers, supermarkets, wholesale markets and entertainment places. It was the first of Da Nang’s planned VND5 trillion ($240.4 million) bond issue for socio-economic development this year.
Vinh Phuc Infrastructure Development (IDV) forecasts earnings of VND30 billion (US$1.4 million) and a net profit of VND10 billion ($476,100) this year. Total asset value was expected to reach VND305 billion ($14.5 million). The company also announced its business results in the first nine months of last year, including revenue of VND21.35 billion ($1 million) and profit of VND8.55 billion ($407,100).
Over 100 businesses from India and central provinces of Vietnam will join a business seminar in Da Nang today, Indian Ambassador to Vietnam Ranjit Rae said yesterday. It is the first ever time that a seminar will be organized with participation from Indian businesses in the city. The event is providing an opportunity for businesses from the two countries to exchange investment and marketing information. Last year the two-way trade between Da Nang and India was just US$200 million. Indian enterprises have invested $4 trillion in Vietnam, but Da Nang has yet to attract an investment project.
The capital’s budget revenues have reached over VND146 trillion (US$7 billion), 99.9 per cent of this year’s estimate, announced the Ha Noi Treasury on the first day of the year. In particular, VND137 trillion ($6.5 billion) came from domestic taxes and VND9 trillion ($0.4 billion) from imports-exports. The Treasury spent nearly VND62 trillion ($3 billion) from the local budget, or 80 per cent of the yearly forecast. Total budget revenues in Ha Noi are estimated to reach more than VND161 trillion ($7.7 billion) this year.
