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BUSINESS IN BRIEF 16/6   2010-06-16 - Viet Nam Net

HCM City hi-tech zones aim for US$150 million turnover
HCM City’s technologically-advanced and powerful corporations and localities have announced a joint initiative to raise turnover of US$150 million.

To achieve this target, the city’s management board for high-technology zones will give priority to developing in three fields, namely micro electronics, information technology and telecommunications.

Municipal authorities are also carrying out a strategic plan on developing hi-tech zones in the 2011-2015 period with a vision for 2020, with an estimated total investment of about VND5,800 billion.

The plan will focus on attracting investment, developing human resources and promoting research.

Vietnam to promote basa fish in Egyptian market
According to the Vietnamese Trade Counselor to Egypt, Dang Ngoc Quang, with its current level of demand and its population in Egypt, if Vietnam improves its marketing, its export turnover of basa fish to the country is likely to increase to US$300 million.

With a population of 80 million, Egypt is a large potential export market for Vietnam. However, Vietnam’s export turnover to this market far from matches its potential.

Vietnam’s seafood exports to Egypt reached US$68 million in 2008, US$60 million in 2009 but only US$12.2 million in the first four months of this year. The sharp drop is due to disinformation spread about Vietnam’s basa fish by the Egyptian media in late March 2009. However, the product is still very sought after by many markets but the consumer power remains low while the demand is still high.

Fish and seafood is a long-standing favourite dish in Egypt but domestic sources of supply from big lakes and the Nile River fail to meet the domestic demand for different kinds of seafood. Therefore, Egypt has to import a large volume of seafood from abroad such as cuttlefish, shrimp, basa fish, sea crab. Vietnam mainly exports shrimp and basa fish fillets to Egypt.

In early 2009, before the misleading information about Vietnam’s basa catfish was released, Vietnamese basa products were available everywhere in Egypt, big and small supermarkets, markets and retail shops.

In fact, Egypt has a great demand for Vietnamese basa fish, which are sold at good prices and high quality.

Currently, the product still can be seen in major supermarkets such as Carefour, Metro and several wholesale markets and it is also available daily in five-star hotels in Egypt.

The Director of the Al Hamd Company, Abdal Rahman Abu Shamah said, “Vietnamese basa fish ranks first amongst different kinds of fillet basa products in the Egyptian market. My company imports between 30-40 tonnes per month and distributes to supermarkets, shops and big hotels in Egypt. We are expecting to increase our import volume by 20 tonnes per month in the near future.”

Staff at the Carefour and Metro supermarkets said that Vietnam’s basa fish is high quality, delicious, easy to cook and at a reasonable price,

Mr Ashrab from the Metro supermarket said that his supermarket sells from 30-40 kg of basa fish imported from Vietnam per day and that his family still uses this product everyday. However, many people still feel unsafe about eating this product because they don’t have any accurate information on it.

Over the past year, the Vietnamese Trade Office has worked closely with the Egyptian Chamber of Commerce and Industry, the Vietnam Association of Seafood Exporters and Processors (VASEP) and seafood exporters to organise seminars, forums and fairs to promote Vietnamese seafood products. However, Egyptian consumers are not aware of this.

The Vietnamese Trade Counselor to Egypt, Dang Ngoc Quang said that to raise the export turnover of seafood, exporters need to ensure quality and advertise more in the Egyptian market to win the Egyptian consumers’ trust.

Vietnam, China to boost electrical cooperation
Chinese businesses will create a breakthrough in the development of the Vietnam’s and China’s electrical and ore-mining sectors.

This goal was given by the Chairman of China’s business citizen committee at a seminar on the promotion of the Vietnam-China electrical cooperation 2010 in Hanoi on June 16.

The seminar, jointly held by the Vietnam Chamber of Commerce and Industry and China’s business citizen committee, is aimed at creating for businesses from both countries to seek cooperation opportunities and encouraging Chinese electrical and ore-mining equipment manufacturing companies to expand their business in Vietnam.

Despite the global economic downturn, two-way trade between Vietnam and China has seen an average growth of 32 percent in the 2000-2010 period. Turnover reached US$21.35 billion in 2009 alone.

2010 is a very significant year as the two countries are celebrating the 60th anniversary of the establishment of diplomatic relations. It is also when the ASEAN-China Free Trade Area agreements on the reduction of taxes for agricultural and industrial products take effect.

Quality of rice for export gets improved
This year, Vinh Long province plans to export around 380,000 tonnes of rice.

The province also aims to improve the quality of its rice from planting to processing and preserving post harvest to increase its exports of high quality rice to demanding markets.

The province has 166,000 ha of rice with an estimated annual output of over 800,000 tonnes. The provincial department of agriculture continues to help farmers to cultivate rice sustainably, use high-quality varieties, and encourages them to build special cultivation zones to meet export standards.

The Vinh Long Food Joint Stock Company has invested more than VND26 billion in building a processing plant, upgrading its husking line and installing more modern facilities for processing and preserving to raise the proportion of its high-quality export rice to 56 percent of total export volume.

The Vinh Long import-export joint stock company has also invested VND28 billion in building a new processing plant and VND10 billion in equipping two processing facilities in Cai Cam and Co Chien.

In the first half of this year, businesses in the province have exported nearly 200,000 tonnes of rice and expanded into several new markets, including Japan and the Middle East.

Huyndai Vinashin builds new cargo vessels
The Hyundai-Vinashin Shipyard Company in the central province of Khanh Hoa on June 15 handed over a 56,000 DWT cargo vessel named the E.R. Barcelona to Germany’s company E.R.Shiffahrt.

The 70,000 cubic metre ship, which is 187m long, 32.26m wide and 18.3m high, has a speed of 14.5 nautical miles per hour. Currently, the company is building new four cargo vessels including two of 56,000 tonnes and two of with 37,000 tonnes ordered by Norwegian customers.

This is the fourth of 14 vessels to be built under a contract with their German partners. Earlier, in October 2009, the company built and handed over three new ships to foreign customers.

Hanoi: budget revenues to reach VND46,783 billion
The capital’s economy grew well in the first six months and its Gross Domestic Product (GDP) increased by 10.1 percent.

As a result, total budget revenues in Hanoi are estimated to reach VND46,783 billion, or 53 percent of the yearly forecast, including VND41,000 billion from domestic taxes and over VND4,800 billion from imports-exports.   

To reach these figures, apart from managing its budget prudently, Hanoi’s Treasury introduced a project to update how the state collects its budget from tax agencies, the State Treasury and customs. 

In particular, Hanoi Treasury is entrusted with collecting domestic taxes from its 29 districts to commercial banks, which open accounts with the treasury, to make it easier for enterprises to pay their tax.

In the first six months, Hanoi Treasury spent over VND13,500 billion from the local budget, or 40 percent of this year’s estimate. Of this, nearly VND6,000 billion was used for investment and development and VND1,000 billion was spent on key projects to celebrate the 1,000th anniversary of Thang Long-Hanoi.

MoIT warns of fraud in West Africa
The Ministry of Industry and Trade (MoIT) has sent a warning to domestic businesses about trade fraud in Africa.
The MoIT said that some subjects claimed to be businesses from West African countries, such as Togo, Benin, Cameroon, Nigeria, Ghana and Senegal or from organisations, like the Niger Delta Development Commission or the Economic Development Support and Relief Organisation of West Africa (EDSROWA). However, most of these cases are frauds. They asked Vietnamese businesses to pay various fees, such as import or transaction fees worth thousands of US dollars in advance.

To avoid risks, the MoIT pointed out that most West African countries speak French so all documents are written in French. If documents, such as business licences are in English they will be fraud. Transactions via the Internet are not available in these countries because their infrastructures are not up to standard, therefore Vietnamese businesses should check all information very carefully, the ministry warned.

It added that to expand markets in Africa, businesses should take part in fairs or join trade delegations led by ministries or departments or make direct fact-finding tours. Businesses can also ask the ministry to supply information about these markets when carrying out activities there. If they find unusual problems during transactions they should verify their partners.

Vietnam to reduce tax rates on many goods imported from RoK
From July 3, Vietnam will reduce tax rates for many goods imported from the Republic of Korea (RoK), including lamb, beef and pork up to 7-10 percent, milk products up to 10-15 percent and fish and fruit up to 15-20 percent.

This reduction follows the Ministry of Finance’s recent circular on Vietnam’s preferential import tariffs concerning the ASEAN-RoK Free Trade Area Agreement during 2010-2011 period.

To benefit from these preferential import tariffs, goods must be imported directly to Vietnam from nine of ASEAN’s members, including Brunei, Cambodia, Laos, Indonesia, Malaysia, Myanmar, the Philippines, Singapore and Thailand.

Building strong brand names a priority
An increasing number of enterprises are paying more attention to building up trademarks to underline their prestige, quality and commitment to customers and gradually secure a firm foothold in both the domestic and international markets.

There are more and more small- and medium-sized businesses in the current trend of globalization and strong growth of industries as well as goods supplies, which makes the market ‘pies’ smaller and smaller.

The Binh An Seafood Joint Stock Company was established just three years ago but has established its trademark in aquaculture, and the processing and exporting of seafoods. Binh An is one of the 43 enterprises that were selected as having strong brands in 2010.

In 2007, the company’s revenue was less than VND100 billion but in 2009, their figures reached VND 1,300 billion. Binh An is expected to earn VND2 trillion by the end of 2010.

Pham Thi Dieu Hien, President of the Board of Directors of Binh An Company, said that it is essential for each business to create a strong trademark, which facilitates their sales and expands their markets. She said that thanks to them concentrating on establishing their trademark, her company has developed well, providing jobs for poor workers, fish breeders and smaller companies.

Ms Hien stressed that Vietnamese enterprises need to prioritize their trademarks, which are State sponsored.

“In business, in order to succeed, you must have a skilled workforce, modern facilities and specific targets,” Hien said. “We safeguard our company by producing high-quality goods. We also meet all customer demands. Our six targets include quality for life, quality for aquacultural areas, quality for factory, quality for products, quality for services, and quality for consumers.”

Like the Binh An Seafood Joint Stock Company, the Vina Cafe Bien Hoa Company has been successful in penetrating into tough markets such as the US, China, and ASEAN. As a result, the management board has strategies for its products, markets, human resources and marketing tactics, to introduce the Vinacafe trademark to both domestic and international customers. Thanks to that, the company’s revenues has increased sharply.

Pham Quang Vu, Deputy Director said that thanks to advertising their trademark, the company has made a huge step forward, earning an export turnover of US$7.5 million per year.

Currently, there are many fake and poor quality goods which have made a negative impact on enterprises’ trademarks, especially in the beverages fields. Therefore, apart from creating their trademarks, it is necessary for Vietnamese enterpises to protect them.

Dr Tran Quy Thanh - Chairman of Management Board of the Tan Hiep Phat Group expressed his pride at being selected as an business with a national trademark. He added that, the company will be more responsible for protecting their trademark and improving the quality of their products, expanding their markets and sticking to their committements.

The Deputy Minister of Industry and Trade Nguyen Thanh Bien said that apart from building up national trademarks, enterprises should find ways of penetrating foreign markets and present the country’s image before the world. Mr Bien emphasised that enteprises should strive to improve the quality of their products and services to meet the criteria for national trademarks.

Ministries and localities urged to fulfill socio-economic goals
The Ministry of Finance (MoF) asked the relevant ministries, agencies and localities to cooperate in controlling prices, containing inflation and supervising the financial market.

Minister of Finance Vu Van Ninh sent a document to ask ministries and localities to implement financial and state budget tasks in 2010, as there have been positive changes in economic growth, mostly in the fields of industry, agriculture and service early this year.

Mr Ninh said the MoF has co-ordinated with relevant ministries, agencies and localities to monitor the development of market price in the country and the world, and in devising timely measures to stabilize prices under the regulations.

The MoF also predicted the demand for production and consumption to make a suitable plan for each locality.

Minister Ninh also asked ministries to control and supervise activities of securities companies, investment funds and insurance companies to avoid financial risks. Besides, it is needed to control, monitor and predict investment capital inflows to encourage foreign investors to make long-term investments in Vietnam,” he said.

Under the document, relevant ministries and localities are also asked to take measures to improve the efficiency of production and business activities, co-ordinate with taxation and customs sectors to collect taxes in a timely manner, strengthen supervision on sources of revenues, and control the state budget’s spending effectively.

EVN determined to ensure process
To connect the Son La hydroelectric power plant to the national grid, Electricity of Vietnam is focusing on building two 500kV electric lines.

The first line will run from Son La to Hoa Binh and onto Nho Quan and the second line will stretch from Son La to Hiep Hoa.

Construction on the 500kv Son La-Hiep Hoa line started on September 20, 2009 and is expected to completed in March 2011. The line with an investment of VND2,884 billion, stretches through the five provinces of Son La, Phu Tho, Vinh Phuc. Thai Nguyen and Bac Giang.

The amount of compensation for the land clearance in Vinh Phuc province has met its target and the province will have a total of 92 pylons over 42km. the only problem has been the slowness of the construction of the residential areas for resettled people and the payment of the pylons managed by the Northeast Forestry Production and Science Centre under the Ministry of Agriculture and Rural Development. The consultancy unit is currently evaluating the impact of the project on the military’s work and their everyday lives.

Phu Tho province has now handed over 120 out of a total of 166 pylons. The National Power Transmission Company (NPT) says that the slow land clearances have been due to the line’s traversing over different kinds of environment.

Phu Tho province’s People’s Committee and Department of Environment and Natural Resources have also been slow to approve the land clearance plans.

Do Huu Hao, the Deputy Minister of Industry and Trade has worked with the leaders of Vinh Phuc and Phu Tho provinces to discuss measures to deal with obstacles in land clearance. Accordingly, Phu Tho province’s People’s Committee will accept plans to complete the necessary procedures to build resettlement residential areas in June as quickly as possible.

Phung Quang Hung, the Vice Chairman of Vinh Phuc province’s People’s Committee said that the province considered the new line a priority. It has set up a steering committee on land clearances and has encouraged the local people to hand over land before June 30. 

Vietnam’s highest lotus bub tower near completion
The final stage of the 68-storeyBitexco Financial Tower was completed on June 13.

Vu Quang Hoi, the president of Bitexco Group’s board of directors said that after five years of construction, the Bitexco tower had entered its final phase, which demonstrates that domestic investors are able to construct a building to international standards.

The tower has the shape of a lotus bub and is a symbol of Ho Chi Minh City’s development as an economic centre.

Le Hoang Quan, the chairman of Ho Chi Minh City’s People’s Committee praised the projects’ quality and the efforts of Bitexco’s staff, investors, and consultants.

The Bitexco Tower will be inaugurated in October to mark the 1,000th anniversary of Thang Long-Hanoi and the 11th Party Congress.

Tra, basa fish exports to Russia double
Vietnamese exports of tra and basa fish to Russia earned over US$27 million in the first six months in 2010, over twice the amount compared to the same period in 2009.

However, the price of tra and basa fish to this market still stands at around US$2.05 per kilogram.

It will soon be winter in Russia, when consumption traditionally rises. By the end of this year, Vietnam’s tra and basa fish exported to this market will have earned the country almost US$100 million.

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