Business in brief 11/05/2008

Customs officers from northern provinces of Lao Cai, Dien Bien and Ha Giang, and Hai Phong port city of Vietnam and their colleagues from Kunming, Yunnan province of China, met in Lao Cai on Nov. 4 to discuss measures to boost cooperation.

At the event, the two sides briefed each other of their operations and achievements in customs management over the past years.

They discussed a cooperation plan for the coming time and agreed that modernisation of custom systems will contribute to facilitating bilateral trade and economic exchange as well as legal enforcement in their countries.

Delivering the opening speech, Deputy Head of Kunming Customs Department He Xujing stressed the importance of the meeting, which would open up numerous cooperation opportunities for the two sides.

The meeting was the second of its kind following the first one held in Kunming .

After the first meeting, at their common border gates, the two sides had many friendship exchanges, boosting mutual understanding, tourism and trade between their localities.
 

Vinacomin wants to supply own power
The Vietnam Coal and Mineral Industries Group (Vinacomin) has asked the Government if it can use its own power stations to supply coal mines run by the company in northern Quang Ninh province.

Vinacomin power stations would provide enough power for the company’s local exploitation activities, said deputy general director of Vinacomin Nguyen Chien Thang.

The proposal was made after Vinacomin’s coal production was severely affected by a series of power cuts, especially in the third quarter of 2008.

Quang Ninh coal mines were one of EVN’s biggest customers, he said. “Vinacomin produces 40 million tonnes of coal per year in Quang Ninh. This figure is set to double in the next decade. But the power supply from EVN is not always stable.”

Power was cut 806 times over 45 days in June and July this year, affecting 21 of Vinacomin’s mines, the group said. The power cuts not only affected coal production but were also dangerous for mine workers.

“With our capital, 10 coal-powered plants are being set up with a total capacity of 2,090 MW. The plan is set for completion in 2012,” Thang said.

Out of these 10 projects, four plants are being built in Quang Ninh with a total capacity of 1,100 MW.

The Cam Pha 1 Power plant with a capacity of 330MW will be operational in April 2009 while the Cam Pha 2 plant will be completed in 2010. The Cam Pha 3 with the capacity of 270MW and Mao Khe plant with capacity of 440 MW will start running before 2012.

“Once the four plants are up and running, we can also sell electricity to EVN to strengthen the national grid,” the deputy director said.
 

Dung Quat hopes for 5 billion USD steel plant
Japan’s JFE Steel Group, one of the world’s leading steel makers, has received a good sign from local authorities to build a steel complex in Dung Quat Economic Zone (EZ) in Quang Ngai province.

Dung Quat EZ Authority’s Investment Promotion Centre director Le Van Dung said on Nov. 4 that the province has sent the investor’s plans to the Government for consideration.

The complex, worth 5 billion USD in the first phase, is expected to churn out 6-10 million tonnes of steel annually mainly for export, Dung said, adding that the Japanese firm has yet to officially disclose the amount of investment capital for the second phase.

JFE Steel proposed to make steel products for automobile, shipbuilding and mechanical industries, after spending more than a year studying the province’s investment environment, he noted.

Covering 1,000 ha of land, the complex will be built within the expanded Dung Quat EZ. Gas generated in the steel manufacturing process will be recovered to generate power, which will be used to operate the complex and also sold to Electricity of Vietnam.

The complex expects to employ between 2,000 and 3,000 workers, two-thirds of which would be engineers and skilled workers.

If approved, the complex will be one of the largest steel projects in the zone, along with a joint project by Tycoons and E-United, which will cover 455 ha. The capital for the project, first licensed in August 2006, is expected to rise to 3.3 billion USD.

The first stage of the complex, to be completed by 2010 with a capital of 1.8 billion USD, will employ 10,000 workers and 300 foreign experts.

The dung Quat EZ has attracted a total registered capital of 10.8 billion USD during the first 10 months of this year.
 

Bolivia wants to increase trade ties with Vietnam
Bolivian trade officials have chosen Vietnam and China as the two markets replacing the US in the circumstance that the biggest economy is going down.

In the coming months, Bolivia will hold joint meetings with Vietnam and China to discuss possibility of signing bilateral trade agreements, said Bolivian Deputy Foreign Minister Pablo Guzman at a meeting of the Bolivia-Brazil trade commission in La Paz on November 3.

Once the agreements are inked, Bolivia would not only close its export gap caused by the reduction in trade ties with the US, but also expand its exports, the official said.

Two-way trade between Bolivia and Vietnam stood at a modest level of 2.3 million USD last year. Bolivian trade officials hope the figure would see a considerable increase in the near future.
 

Vietnam attends Havana International Fair
Vietnamese businesses are showcasing their staple products, including farm produce such as rice, tea, coffee, pepper, cashew nuts and footwear, at the 26th annual Havana International Fair (FIHAV 2008).

They are the Vietnam Northern Food Corporation (Vinafood I), the Vietnam Superintendence and Inspection Joint Stock Company (Vinacontrol), the Minh Hoa Footwear Company, and the Tan-Viet Food Company.

At the opening of the 6-day fair on Nov. 3, Minister of Foreign Trade Raul de la Nuez said Cuba’s foreign trade value increased 39 percent year-on-year in the first nine months of this year.

He affirmed that Venezuela, China, Canada, Spain, Brazil and Vietnam are Cuba’s main trade partners.

A record number of 420 businesses from 56 countries attended FIHAV 2008, according to president of the fair organising committee Abraham Maciques.

A forum on trade opportunities in Cuba will be held by the Cuban Ministry of Foreign Investment and Economic Cooperation during the fair. 
 

Bilateral trade between Vietnam and Spain is forecast to rise 30% to $1.64 billion this year, a Spanish embassy official said Tuesday. Vietnam’s exports to Spain are expected to account for $1.45 billion in 2008, said Carlos Dominguez Agulleiro, head of the Economic and Trade Office of the Embassy of Spain in Ho Chi Minh City. Bilateral trade between the two countries totaled $775 million in the first eight months of this year,.

Vietnam’s key exports to Spain include footwear products, garments, coffee and seafood, while it imports mainly machinery, chemicals, medicines and steel products from the European nation.
 

Vietnam’s imports from Kuwait totaled $59.76 million in the first half of this year, up from $10.26 million in the same period last year, the Ministry of Industry and Trade said Tuesday. The key import items were liquefied petroleum gas, sulfur, plastic and cars, the ministry said in a statement. Vietnam’s exports to Kuwait more than tripled to $15.93 million between January and June from $5.15 million in the year-earlier period.

The main Vietnamese exports to the Arab state included milk and seafood products, tea, furniture and electrical cables. Although Kuwait remains a small market for Vietnamese exporters, the oil-rich state has surplus revenues averaging between $21 billion and $30 billion each year, the ministry said. As such, Vietnam should focus on drawing investment from the Middle Eastern country, it added.
 

Vietnam intends to borrow $120 million from the Asian Development Bank to expand the Danang University, local media said Tuesday. The extension of the university, located in Danang City, 760 kilometers south of Hanoi, will cover 50 hectares, the Thanh Nien newspaper said, citing a local education official. Bui Van Ga, the university’s principal, was quoted as saying that the Japanese government has agreed to grant $1 million.
 

Yusen Air & Sea Service (Vietnam) Co., Ltd. has opened a new office and warehouse in the northern province of Hai Duong, near Hanoi. The office and the 6,000-square-meter Hai Duong Logistics Center are located in the same building within the Phuc Dien Industrial Zone, YAS said in a statement. The opening is the Vietnam subsidiary’s 10th business foothold in the country. The subsidiary, based in Hanoi, recently opened a new office within Hoa Lac High-Tech Park in Hanoi. The office is the ninth location in Vietnam for the YAS unit, headquartered in Ho Chi Minh City, YAS said in a statement.
 

Kinh Do Corp (KDC), Vietnam’s largest confectionary maker by market share said on Tuesday it would boost output by at least 10% and increase efficiencies in order to hit its profit target this year. Kinh Do reported net profit fell 15% to 140 billion dong in the first nine months of 2008 after losses from financial investments and higher costs in the third quarter, a company spokeswoman said. The company forecast in a statement made in March that its net earnings this year would fall nearly 6% to 211 billion dong, without giving a reason. Shares in Kinh Do closed flat at 34,000 dong on Tuesday as the Ho Chi Minh City Stock Exchange rose 3.67 percent to end at 361.44 points. The market has lost 61 percent so far this year.
 

Prime Minister Somchai Wongsawat is to attend the third Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (Acmecs) ministerial meeting in Hanoi, Vietnam, from Nov 6 to 7. The dialogue, launched during the government of former prime minister Thaksin Shinawatra, is aimed at narrowing the economic development gap between Thailand and its neighbouring countries - Burma, Cambodia, Laos and Vietnam. The parties will discuss economic development in sectors including business investment, agriculture, industry and energy, transportation links, tourism, human resource development and health.
 

Vietnam intends to borrow $72 million from the Asian Development Bank to develop the infrastructure of Thanh Hoa City, 150 kilometers south of Hanoi, the government said Monday. Prime Minister Nguyen Tan Dung has agreed to set up a working group to negotiate with the ADB for the loan, the government said on its Web site. The group will include officials from the central bank and Ministry of Planning and Investment. The government intends to spend $115 million to develop Thanh Hoa City’s infrastructure, a project that will benefit more than 200,000 city dwellers, it said. The government didn’t say when the negotiation will begin.

The bad debts of Vietnam’s credit institutions won’t exceed 4% of total outstanding loans by the end of this year, local media said Monday, citing a central bank official. At the end of September, the bad debts of the country’s banking system were valued at VND35 trillion ($2.12 billion), or 2.92% of total outstanding loans, said the online news provider VnExpress.net. Nguyen Dong Tien, deputy director of the State Bank of Vietnam, was quoted as saying the banks are safe, as the proportion of bad debts is below the allowable 5%. The value of loans to the real estate sector at the end of September was VND100 trillion, or 9.15% of total outstanding loans, Tien said - below the safety threshold of 10%. Tien said VND22 trillion would be provided to deal with bad debt, the report added.

Japanese manufacturers are reducing investments in China, Vietnam, and Russia in response to the global economic crisis, Nikkei English News reported, without saying where it got the information. In China, Mitsui Chemicals Inc. canceled plans for a 30 billion-yen ($303 million) plant to be built in Jiangsu province late this year. Mitsubishi Gas Chemical Co. will postpone opening a factory that would produce raw materials for synthetic fibers. Teijin Ltd. suspended plans to build production facilities for plastic used in consumer electronics, Nikkei said. In Vietnam, Isuzu Motors Ltd., Japan’s largest maker of light-industry trucks, cut its production target by about 15 percent, Nikkei reported.

Vietnam’s central bank said on Monday growth in bank loans and deposits weakened in the first 10 months of this year compared to the same period last year. anuary-October bank deposit growth slowed to 10.59 percent from 32.97 percent, the State Bank of Vietnam said in a report, while loan growth slowed to 19.6 percent from 37.73 percent.

Vietnam cut its economic growth target to 6.7 percent for this year, lower than an earlier forecast of 7 percent, the government said in a statement posted on its Web site. This year’s exports will be $1 billion less than the $65 billion projected at the beginning of the year, the government said in the statement dated Nov. 1. Vietnam’s economy is faltering as the global financial crisis hurts demand for exports, while floods in the past week destroyed crops and caused diseases to spread in cattle and poultry. The country’s exchange rate and tax policies should be flexible to promote production and exports, and banks should cut borrowing costs, the government said in the statement.