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BUSINESS IN BRIEF 16/9   2008-09-16 - VNA

FPT becomes Linksys’s distributor

The FPT Distribution, a subsidiary of Vietnam ’s leading IT group Financing and Promoting Technology (FPT), has been chosen as an authorised agent of Linksys, an arm of the Cisco Systems group.

Under their freshly-signed agreement, FPT Distribution will be allowed to release Linksys’s products of wireless, audio and internet technology through its 956 agents in 53 provinces and cities in Vietnam .

Linksys Sales Manager for Asia-Pacific Boon Ping Tang said FPT Distribution, a distributor pursuing a strategy towards clients, was Linksys’s strategic selection.

He also said that in a near future, Linksys will penetrate more deeply into the Vietnamese market by expanding its network of agents and warranty centres.

FPT Distribution General Director Tran Quoc Binh said the deal showed Linksys’s confidence in his group.

According to him, Linksys’s requirements are strictly demanding with network of agent and sales staff as well as other issues such as consultancy, marketing, technology assistance, financial capacity, and distribution experiences.

Set up in 1988, Linksys is known for its products of wireless and audio for consumers and small and medium-scaled enterprises.

Crude output falls short of expectation

It is difficult for the Vietnam National Oil and Gas Group (PetroVietnam) to achieve its yearly target of tapping 16.2 million tonnes of crude oil this year, according to a group executive.

So far this year, PetroVietnam has only 57 percent of the set target done, the executive said, adding that output at the newly-operated oil fields such as the Phuong Dong (East) and Ca Ngu Vang (Golden Tuna) has fallen short of expectation and the exploitation at overseas oil fields was delayed due to objective reasons.

Despite low crude oil output, PetroVietnam earned more than 8 billion USD from exports in the first eight months of this year, up 80 percent from the same period last year, thanks to higher price on the world market, the executive said.

The oil price stood at an average 117.6 USD per barrel during the eight-month period, 53.6 USD higher than PetroVietnam’s expectation.

The executive said in a bid to realise the annual target, in the remaining months of this year, PetroVietnam will put more oil fields into operation, along with completing negotiations on three projects overseas with foreign partners, including Zarubezneft and OAO Gasprom of Russia and PDVSA of Venezuela.

VNM boasts profit in eight months

Vietnam Dairy Products Joint Stock Company (VNM) reported to have gained total revenue of 5.47 trillion VND (331.8 million USD) in the first eight months of this year or 66.7 percent of the company’s annual plan.

The company said it earned a pre-tax profit of 932 billion VND (56.5 million USD) in those eight months, or 81.8 percent of the yearly plan.

During that period, the company grew by 22.7 percent in output and 66.4 percent in value compared with the same period last year.

Standard Chartered to open 30 branches across Vietnam

Standard Chartered Bank has signalled that it plans to open 30 branches in Vietnam over the next four years, after gaining approval to be the first overseas bank to incorporate their local operations in the country.

Ashok Sud, chief executive of Standard Chartered Bank in Vietnam, on September 15 told reporters in Hanoi that local incorporation would enable it to be better positioned to help Vietnamese companies raise capital in international markets.

The UK bank expressed confidence in the long-term development of Vietnam ’s economy, saying that, “Given the turmoil in the global and local markets, all investments of the bank in Vietnam have been thoroughly considered.”

It is expected that Vietnam’s economy will need an injection of about 50 billion USD. Foreign banks will need to supply some of that capital.

The liberalisation of the banking sector comes amid a worsening economic backdrop in Vietnam, with annual growth revised down to 7 percent and credit growth limited to control double-digit inflation.

But Vietnam remains attractive, because it is one of the least penetrated markets in Asia , with just 1 in 10 of its 87 million population holding a bank account.

Sud added that the effective controls the Government put in place to curb inflation and stabilise the economy demonstrated a sure touch.

In terms of market share in Vietnam , some 40 foreign banks account for less than 10 percent of total lending in the country. Over the next 5-10 years, local banks are still expected to hold an 85 percent market share.

However, the participation of foreign banks like Standard Chartered will help domestic enterprises access high quality banking services.

Standard Chartered Bank owns a 15 percent stake in Asia Commercial Bank (ACB). The UK bank said it had no plans to increase its investment in ACB at this time. In contrasts, HSBC has increased its stake in Techcombank from 15 percent to 20 percent.

Standard Chartered Bank opened its first branch in Vietnam in 1904. The bank has two branches in the country, the maximum permissible. They focus on serving the wholesale banking needs of Asia-based companies in the country.

Standard Chartered Bank plans to sign a contract to loan the Vinacomin group 58 million USD on September 16.

350 million USD mobilised for agriculture in 2009

The Ministry of Agriculture and Rural Development (MARD) plans to mobilise 350 million USD from outside sources for agricultural development in 2009.

Of the amount, 200 million USD is expected to come from official development assistance (ODA) capital and the rest from foreign direct investment (FDI).

Also in 2009, the MARD will continue negotiations on tariff and non-tariff, agricultural services and building free trade among the Association of Southeast Asian Nations (ASEAN) and the Republic of Korea , India , Japan and Australia with the hope of helping Vietnamese businesses expand its agro-forestry market.

More yellow flower tea found in Lam Dong

Local scientists have discovered yellow flower tea trees in a forest in Da Lat city, Central Highlands Lam Dong province.

This is the third yellow flower tea population uncovered in Vietnam . The two other populations had been found in Da Huoai district and the Cat Tien National Park . This kind of flora has been found only in China and Vietnam. The endemic plant has highly economic and pharmaceutical values and is now facing an extinction threat.

Amway believes in successful business in Vietnam

Amway Vietnam director How Kam Chiong is confident that his company, which is a branch of US Amway, will succeed in its business in the country.

Talking with a Vietnam News Agency reporter on September 15, the director said his belief is well-grounded, citing the local populous market with a large labour force, and the support of managing agencies and the legal system.

Direct selling was legalised in Vietnam in 2005 with the promulgation of the Competition Law. The Vietnamese government has also issued Decree 06/2008/ND-CP defining in details the responsibilities of businesses and individuals involving in the business, which How Kam Chiong described as “a strong legal foundation” for Amway’s operation in the country.

Amway Vietnam in October 2007 officially put into operation a plant with production lines in southern Dong Nai province to ensure the quality of its products.

With the plant, Vietnam has become the second country in the world to have an Amway’s plant besides the US .

Amway officially operated in Vietnam in February with its headquarters, distribution and training centres allocated in Ho Chi Minh City .

From the current 15 types of products, mainly nutrition, skin care and household cleaning, the company plans to increase its portfolio to 40 by the end of this year, said How Kam Chiong.

By the end of 2008, Amway Vietnam registered an estimated 40,000 IBOs (Independent Business Owners).

Hanoi fair to showcase agricultural products

A fair-cum-exhibition showcasing agricultural products will be held in Hanoi from Sept. 19-23, said the organiser – the Vietnam Farmers Association (VFA) – at a press briefing on Sept. 15.

Farmers and businesses both at home and abroad will display their off craft items and tools used in the agricultural sector, as well as successful farming models.

Seminars discussing ways to provide consultancy and services to support agricultural production and improve farm produce quality will also take place during the event.

Those who recorded outstanding achievements in the sector will be awarded on the occasion.

Director of the VFA’s Economics Department Nguyen Van Chinh said the annual event aims to tighten the linkage among the State, scientists, farmers and businesses to promote sustainable agricultural and rural development.

The fair-cum-exhibition is also seen as a chance for farmers to get access to consultancy, loans, technical service, vocational training and product sales.

A similar event was organised in the central region last July, while another will be held in Ho Chi Minh City next month.

Marriott Int’l to take charge of VinaCapital’s resort

Investment management group VinaCapital has chosen world-renowned luxury hotel operator Marriott International to manage its new five-star hotel and resort scheduled to open in central coastal Da Nang city in 2011.

The two sides signed a long-term management agreement in Ho Chi Minh City on Sept. 15.

The five-star hotel and resort with 271 rooms has an investment capital of 60 million USD.

It is part of a 260 ha complex which includes villas and a golf course. In the next phase, VinaCapital plans to add a residential area, an exhibition and conventional centre, a trade centre and two medium-range hotels.

Ed Fuller, Marriott International President and Managing Director of International Lodging, said he is excited to be part of the emergence of Vietnam’s central coast as an important global leisure travel destination with what promises to be a premier example of the company’s luxurious JW Marriott hotel brand.

VinaCapital is a leading investment management firm in Vietnam with four funds. It is currently managing property worth over 1.9 billion USD.

1trillion VND in Government bonds to be auctioned

Government bonds worth a total of 1 trillion VND will be put on auction on Sept. 18, according to the Hanoi Securities Trading Centre.

The bonds, with the maturity of two and three years, will be issued by the State Treasury on Sept. 22 in the form of book entry.

The bonds will be listed at the Hanoi bourse after being issued.

New seaport to open in Can Tho city

The Vietnam Shipping Industry Group (Vinashin) will put its seaport in southern Can Tho city into operation soon.

The seaport’s 90m long and 15.65m quay is capable of receiving ships with tonnage of up to 5,000 DWT.

Overseas Vietnamese to build 5 million USD garment plant in Hai Phong

Overseas Vietnamese-owned New World Fashion Group will build a 5 million USD garment factory in the northern port city of Hai Phong .

To this effect, Pham Minh Nam , Chairman of New World Fashion group, which is one of leading garment businesses of the overseas Vietnamese community in the UK , signed with Hai Phong’s Industrial Zone Management Board in London on September 14.

At the signing ceremony, Vice Secretary of Hai Phong Party Committee Duong Anh Dien said the city will process investment procedures and land clearance quickly to help New World Fashion Group start construction of its Hai Phong factory as soon as possible.

The Hai Phong factory will be New World Fashion Group’s fourth factory of its kind in Vietnam. The other three factories which are operational include Excel at the My Tho Industrial Zone in Mekong delta Tien Giang province, Garment Care and Phu Tai in northern Hai Duong province, employing more than 5,000 work-hands in total.

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BUSINESS IN BRIEF 15/9   2008-09-15

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