Business in brief 12/18/2008
Central Quang Tri province will sell more electricity to the neighbouring Lao districts, the provincial electricity company said.
The company plans to install more transmission lines and equipments ensure supply capacity of 11 MW to the four Lao districts, in line with a joint commitment between the Electricity 3 Company under Electricity of Vietnam (EVN) and the Electricity of Laos (EDL) company.
Quang Tri has been providing electricity through two transformer stations at Lao Bao international border gate and La Lay national border gate for Laos over the past 10 years. Power sales in the first 11 months of 2008 reached 10.45 million KWh, a twofold increase as compared with previous years’ average figure.
Vietnam eyes 3.1 billion USD in trade with Middle East in 2010
The Ministry of Industry and Trade (MoIT) has issued an action plan targeting to increase the country’s two-way trade with the Middle East region to 3.1 billion USD by 2010 and to 9.6 billion USD by 2015.
The MoIT has formulated a host of specific plans, including boosting the export of farm products, food and fine art articles to the Middle East markets, which are expected to rake in export earnings of 2.3 billion USD by 2010 and 7.5 billion USD by 2015.
According to the MoIT, the past two years have seen a considerable growth in trade between Vietnam and the Middle East as some Middle East countries are shifting their trade and business activities to oriental countries, including Vietnam .
The United Arab Emirates and Turkey are currently the leading importers of Vietnamese goods in the region while the markets in Israel and Saudi Arabia have also opened up to Vietnam ’s products.
The MoIT reported that last year the two-way trade between Vietnam and the Middle East reached around 1.2 billion USD, 700 million USD of which was Vietnam ’s exports. The figure excluded the value of goods Vietnam exported to the region via a third country.
Vietnam ’s major export lines to the Middle East include rice, coffee, textile and apparels, computers, electronic components, footwear, seafood, and wood furniture while it imports mainly oil and gas, petrochemical products, fertilisers and iron and steel from the oil-rich region.
Saigon Asset Management signs deals with local partners
The Saigon Asset Management Corporation (SAM) signed strategic cooperation agreements on Dec. 16 with three local companies to increase the efficiency of investments in real estate projects.
Under the terms of a deal inked with the Phu My BOT Joint Stock Company (PMC), the two firms will join forces to provide consultancy services and encourage investors to pour investment into other businesses.
SAM and the Thanh Danh Trade and Construction Co. Ltd, one of the major stakeholders of PMC, agreed to work as consultants and arrange investment for the 120 million USD Sai Gon II bridge project, the 250 million USD No. 1 tramcar route in Ho Chi Minh City , and the 800 million USD Ca Pass tunnel project.
SAM, which now manages two funds listed on the German stock market - Vietnam Equity Holding and Vietnam Property Holding, also agreed upon a deal with the SAVIMEX Joint Stock Company (SAV) to jointly develop real estate projects funded by SAV investment.
Indians buy into garments The Indian firm is engaged in manufacturing, marketing, distributing and sourcing apparel. The acquisition will enable it to establish a manufacturing base in Vietnam . Nam Long produces 3 million pieces of ready-to-wear garments per year. Mapletree to invest 70 million USD in Bac Ninh’s VSIP BIDV, Citibank sign int’l agreement BIDV’s policy and business announcements will be publicised through the Thomson Reuters network. US luxury real estate network opens first office in Vietnam Dong Thap to become Mekong sub-region economic centre Five US franchises offered to Vietnamese market
House of Pearl Fashion Ltd will buy a 38 percent stake of Nam Long Garment Joint Stock Co, according to the State Securities Commission.
Mapletree Co., Ltd (Mapletree) has pledged to invest 70 million USD in northern Bac Ninh-based Vietnam-Singapore Industrial Park (VSIP) to build infrastructure facilities for logistics services in an area of 55 ha.
According to the provincial People’s Committee, Mapletree expects its project, when completed, will facilitate the development of logistics services in the northern region and attract big names in logistics industry to the province.
The 700-ha Bac Ninh-based VSIP, inaugurated last year, has so far attracted 18 domestic and foreign investors with registered capital of over 300 million USD.
The Bank for Investment and Development of Vietnam (BIDV) on Dec. 15 signed a memorandum of understanding (MoU) with Citibank for international banking payment services.
The MoU is expected to promote stronger relations between the two banks, and help the Vietnamese side develop its services in offshore markets.
The two banks have already cooperated in managing money flows, developing capital and finance markets, sharing risks, providing derivatives and training human resources.
The same day, another MoU was also inked between the Hanoi-based bank and Thomson Reuters, under which the two partners will cooperate in providing and using news services.
Thomson Reuters will provide news and software on managing money transfers, market risks and professional risks, which would help internationalise banking businesses of the BIDV.
Sotheby’s International Realty Affiliates LLC of the US announced on December 15 the opening of Vietnam Sotheby’s International Realty, its first office in the country.
The office is owned by Indochina Land, real estate subsidiary of Indochina Capital. In January 2008, the Sotheby’s International Realty brand announced the signing of an exclusive 25-year licensing agreement for Vietnam with the company.
“As an emerging international tourist destination with rapid urbanization, Vietnam is a very important market in our global growth plans,” said Michael R. Good, president and chief executive officer, Sotheby’s International Realty Affiliates LLC.
According to Country Manager of the Sotheby’s International Realty Vietnam Jill Chodorov, Vietnam is an ideal place to purchase investments and vacation homes, with one of the fastest growing economies in the world.
Established in 1976, the Sotheby’s International Realty network currently has more than 500 offices in 38 countries and territories worldwide.
The Prime Minister has approved a project to develop the Dong Thap border gate economic zone into a border urban area that will be a new economic hub in the Mekong sub-region.
Covering a total area of over 319 sq.km and sharing 48.7 km of border lines with Cambodia the Dong Thap border gate EZ includes two international border gates, namely Thuong Phuoc and Dinh Ba. It also comprises of five secondary border gates, 11 communes, and two towns.
Under Decision 166/2008/QD-TTg on the EZ’s area and operation rules, the PM encourages all economic sectors, Vietnamese people living abroad and foreign investors to invest in the EZ in areas of import-export, cargo transport, infrastructure, tourism, finance and banking.
All projects invested in the EZ’s industrial and commercial areas will be entitled to perferential treatment in regard to investment incentives, tax and foreign trade that are applied for areas with specially difficult socio-economic conditions.
Five Vietnamese franchise opportunities for US brands were introduced to businesses in HCM City on Dec. 15.
The brands, presented by the US Commercial Commission in Vietnam , Edwards Global Services Inc. (EDS) and the August Bao Law Firm, include three food franchise opportunities offered by The Melting Pot, Round Table Pizza – the fifth biggest pizza brand in the US - and the fast-food brand Carl’s Jr., as well as a franchise for art and creative education for children under the Abrakadoodle brand, and a business guidance franchise offered by Signs Now.
According to an EDS spokesman, the franchises were offered at costs ranging from 300,000-500,000 USD for the exclusive rights to supply their branded products.
This is an exploratory step in the franchise market, which gives the franchise owner the exclusive rights to use and market a brand in Vietnam . Franchise activities have recently been on the rise in Vietnam as franchise owners increasingly seek to capitalise on prestigious brand names, products and services, thanks to the country’s stable economic growth. This increase in franchising has led to the country’s lawmakers to examine the relevant laws relating to franchises.
According to foreign investors, Vietnamese law governing franchises has been markedly upgraded and amended to protect trademarks, as well as offering legal protection to both franchisers and franchisees.
Donald Nay, a commercial counselor with the US embassy, said that there are now an increasing number of opportunities for US franchise companies to enter the Vietnamese market in the areas of food, soft drinks, retail, education and training and business administration.
