Business in brief 26/08
The State Bank of Vietnam said Wednesday (16 Aug) it has given its approval for Dai Tin Commercial Joint Stock Bank to double its registered capital to VND2 trillion (USD112 million). It said Dai Tin Bank, located in the Mekong Delta province of Long An, will raise its capital this year.
Vietnam’s central bank will keep its benchmark base rate unchanged at 7 percent in September, a monthly directive signed by the governor said on Wednesday. The directive takes effect on Sept 1. Other rates including the discount and refinance rates, currently at 5 percent and 7 percent, respectively, will also remain unchanged, the directive said. The central bank has said interest rates were likely to remain steady for the remainder of the year.
A free trade agreement between Japan and Vietnam will go into effect on Oct 1 with an aim to liberalize nearly 92 percent of bilateral trade during the next 10 years, the Japanese government said Tuesday. Under the FTA, which is Japan’s 11th, Tokyo will abandon tariffs on such products as fruit and shrimp imported from Vietnam. Hanoi, meanwhile, will eliminate custom duties on Japanese products, including steel products, auto parts and some agricultural products.
PVGas North has inaugurated the first phase of the Northern Depot of Liquefied Petroleum Gas (LPG) in Dinh Vu Industrial Zone in Hai Phong City. This is the largest LPG storehouse to be put into operation in the northern region and the second largest one in Vietnam, after Thi Vai Depot. The storehouse has a total investment capital of over VND580 billion and it is designed to have a storage capacity of 5,000 tons this year and an estimated 10,000 tons by 2013. The storehouse’s output is expected to increase annually to over 200,000 tons by 2013 and nearly 300,000 tons by 2018. The project is part of a master plan to build a system of petroleum and LPG depots, approved by PetroVietnam. The construction of the system started early last year on an area of 3.69 hectares. The system includes five basins with a capacity of 7,500 tons per basin.
Yearly consumer prices in Vietnam gained 2.0% during August compared with a previous incline by 3.3% in July. Consumer prices gained at the slowest pace since 2002, giving signs that inflation eased as monetary policy makers put restrictions to control credit growth. Falling energy, raw materials and primary goods prices also led to an easing inflation. Rice prices dropped 9.5%, while overall food prices gained 1.7%, while transportation costs declined 8.8%.
The third meeting of the APEC Business Advisory Council 2009 (ABAC 2009) opened in Vietnamese central province of Da Nang on Tuesday. Vietnamese President Nguyen Minh Triet attended the meeting and delivered a speech. The meeting is very important as its result will be reported tothe APEC Leaders at the APEC Summit late this year, said Triet. The summit is scheduled to be held in Singapore. Vietnam is taking measures to promote production and encourage consumption to contain economic downturn, according to Triet. Vietnamese economy is forecast to grow by five percent this year.
The country is creating favorable business environment for local and foreign investors and companies, according to Triet. Triet said Vietnam supports APEC to play a leading role in liberalizing and facilitating trade and investment. The meeting will end on Aug. 27.
Vietnam is expected to import 190,000 tons of cotton this year, the Vietnam news agency reported. The country’s cotton output is estimated to stand at 10,000 tons this year, meeting only about two percent of domestic demand. Cotton growth area in Vietnam has sharply decreased during the past five years, said the newspaper. In the 2001-2002 crop year, the country had more than 32,600 hectares of cotton area. The figure has declined to nearly 3,000 hectares in the 2008-2009 crop, according to the newspaper. Therefore, Vietnam now has to import nearly all of cotton for the country’s textile industry, said the newspaper. Currently, the country needs about 200,000 tons of cotton a year.
Vietnam spent over US$1 billion importing fertilizer and crop protection chemicals in the past 8 months of this year, according to the Ministry of Agriculture and Rural Development. From now until 2020, Vietnam will have to import over 500,000 tons of fertilizer, including urea, DAP and kali, each year. The country annually needs 7-8 million tons of fertilizer but domestic production currently meets just 50 percent of market demand. This will end in 2020 when domestic production is expected to finally meet market demand.
