News in Brief (6/9/2012)

Rice exports hit a record high

Vietnam is likely to export 7.650 million tonnes of rice this year, according to the Vietnam Food Association. The VFA said, rice exports reached 7.101 million tonnes in the past 11 months, and are expected to hit more than 7.6 million and earn nearly US$3.2 million in revenue by the end of this year.

The export price was US$445.56 per tonne, down US$43.3 per tonne on average compared to the same period last year. Truong Thanh Phong, President of the Vietnam Food Association said that 5 percent broken rice including fragrant or sticky rice accounted for 59 percent of total export revenue, up 78 percent from last year.

Rare earth processing plant built in Quang Ninh

A hi-tech rare earth processing plant will be built in Ha Long city, the northern province of Quang Ninh. An agreement to this effect was signed in Quang Ninh by Global Rare Earth, an affiliate of Vietnam’s Tuan Chau Group and the Winglee Resources PTE Company of Singapore in December 2012.

Accordingly, the US$35.5 million Vietnam – Singapore International Rare Earth Ltd, will sit on a 50,000 square metre site in the region’s Viet Hung industrial zone. Construction is expected to finish in the next eight months since the plant gets the government’s permission.

In the second phase, additional mining surveys will be conducted to provide materials for the plant. Rare earth elements are important materials in the production of components used in mobile phones, solar batteries, high-efficiency electric motors, flat-screen televisions, military equipment and other clean energy technologies.

Asia-Pacific conference discusses e-postal payments

A conference on developing electronic-postal payment services in Asia and the Pacific took place in Hanoi, drawing participants from nine regional countries and the Universal Postal Union (UPU). The conference, the fourth of its kind, held in the framework of cooperation between the UPU and the International Fund for Agriculture Development (IFAD), aimed to expand the electronic-postal payment network to serve farmers and small and medium-sized enterprises.

Vietnamese representatives held bilateral meetings with representatives from China, Malaysia, India, Laos and Cambodia. They discussed trialing services and the building of joint programmes to advertise express-money services between Vietnam and other countries.

ASEAN Banker Forum 2012 opens in HCM City

The 2012 ASEAN Banker Forum began in HCM City, organized around the theme “Retail banking: building competitive advantages that engage and retain customers”.    

The forum, hosted by the Vietnam Bankers Association (VBA) and the International Data Group (IDG), aims to offer an interactive platform for commercial banks, banking experts, and consultants to discuss and evaluate Vietnamese retail banking’s potential. It also serves as a venue for Vietnamese and ASEAN bankers to meet and share experiences of the sector’s development in the wider region.

Some experts said that Vietnamese commercial banks have dramatically transformed in recent years, despite slow credit growth rates and tough competition. Almost all banks are now firmly focused on developing services they offer.

Banking service revenues account for 20-30 percent of the sector’s total revenue. Competition has forced banks to invest in technologies expanding distribution channels and improving service quality.

With nearly 40 percent of the population now Internet users, more than 3.5 million mobile phone users, and 15.5 million of fixed subscribers, Vietnam abounds with opportunities for the development of hi-tech financial services.

New ruling fails to rouse gold market

A week after banks stopped accepting gold deposits, the bullion market has yet to see benefits from the central bank’s move. The State Bank of Vietnam’s prohibition on gold deposits took effect on November 25 and was expected to persuade people to sell gold to banks rather than hoard it.

Now banks charge a fee for safekeeping of customers’ gold. The rationale was that customers would avoid keeping the gold if they had to pay for it, and would rather sell it off, increasing supply in the market. But bullion sales barely increased in the last week.

Only 10 and 15 percent of the gold withdrawn from banks was sold, a gold trading company based in HCM City’s Tan Binh District said. Consequently, the price of the precious metal remained at between VND47- 47.15 million per tael on November 30. Earlier the gap between global and domestic gold prices was only VND3.2-3.3 million per tael (37.5gm), but since the banks stopped accepting gold deposits it has risen to VND3.7 million, with local prices being higher.

An analyst said this was because some banks had to buy 20 tonnes of gold bullion to return to their customers while supply was low. The big gap in prices will continue if supply does not improve, he warned. The banks’ safekeeping services, which cost 0.01-0.05 percent of the value, has failed to elicit interest.

Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s HCM City branch, said people have yet to get used to the new concept since for a long time they were paid interest for depositing gold.

He also revealed that only eight banks and 13 companies have registered for gold bullion trading, a tiny number considering 12,000 companies involved in gold trading. But analysts are optimistic that the gold market will see a distinct improvement in early 2013 when banks completely stop trading gold bars.

Korean giant eyes Vietnam market

The largest manufacturer and exporter of “regenerated polyester staple fiber” in Korea, Dae Yang Industrial Co Ltd, has carried out a market survey in Vietnam to find partners for consumption and distribution of its product in Vietnam.

Regenerated polyester staple fiber, which is mainly used for home furniture like sofas, chairs, cushions, pillows and blankets, is lighter than cotton and cheaper than other chemical fibers.
The company is also looking forward to co-operating with Vietnamese textile enterprises such as Viet Tien Corporation or Phong Phu Corporation to carry out joint projects. The Dae Yang has been exporting regenerated polyester staple fiber for more than 20 years to USA, Japan and the EU, with a production capacity of 500 tonnes per month, but this is the first time the company has approached the Vietnamese market.