Vietnam Business and Financial News

Vietnam Financial News Network

BUSINESS IN BRIEF 1/11 2009-11-01 - Viet Nam Net

79 outstanding garment and footwear firms honoured

Seventy nine garment and footwear makers were honoured at a ceremony in Hanoi October 31 for their efficient operations and significant contributions to society.

At the ceremony, Deputy Prime Minister Nguyen Sinh Hung said that garment and footwear are the nation’s crucial industries as they create jobs for more than 4 million people.

He acknowledged the two industries’ all-out efforts to cushion the impact of the global economic recession and reap high profits in production.

Such voting will help encourage other businesses to work harder to weather the economic storm and maintain their growth, said Mr. Hung.

Le Quoc An, Chairman of the Vietnam Textile and Apparel Association (Vitas), said that Viettien Garment Joint Stock Corporation, Viet Thang Textile Joint Stock Company and Thai Binh Holding and Shoes Manufacturing Company have been the most prominent firms in recent years.

He added that, as the global and national economies have bounced back and started to grow again, garment businesses have developed investment strategies in the post-crisis period. They have set targets of earning US$10.5 billion in exports next year and US$16-18 billion by 2015.

The ceremony was jointly held by the Vietnam Textile and Apparel Association, the Vietnam Leather and Footwear Association and the Saigon Economic Times.

Int'l transhipment port built to boost national economy

Construction of the Van Phong International Transhipment Port began in Van Ninh district, Khanh Hoa province, on October 31. It will be the sole port of this kind for containers listed in Vietnam’s master zoning plan for sea ports up to 2020.

The project has great significance in terms of economics, society, and national security and is expected to help Vietnam in its process of industrialization, modernization and international integration, said Prime Minister Nguyen Tan Dung at the groundbreaking ceremony.

The port will provide strong impetus for the development of the Van Phong Economic Zone in the future, he added.

In the first phase, two wharves will be built on an area of more than 42ha together with a synchronous system of warehouses, workshops, roads and technical infrastructure meeting international standards. The port will then be able to receive container ships of 9,000 TEUs and handle a total cargo of 710,000 TEUs per year.

The first-phase project, with a total investment of more than VND6,170 billion, is scheduled for completion in 2013.

When the overall project is completed by 2020, the port will have 37 wharves with a total length of 12,590m to transfer more than 15 million TEUs of cargo annually.

Domestic industry recovers strongly

Total industrial production value reached nearly VND569 trillion in the past ten months, an increase of 7 percent compared to the same period last year, the Ministry of Industry and Trade has announced.

The non-state sector saw the highest rate of increase at 8.9 percent, followed by the foreign invested sector (7.4 percent), while regional industrial production saw a decrease of 4 percent.

These figures showed signs of industrial production springing back to life since the beginning of the second quarter.

The price of materials for production such as electricity, crude oil, coal and gas also went up. Some consumer items such as air conditioners, refrigerators, detergents and construction materials rose as much as 19.5-48.5 percent.

Some exported items including garments and textiles, powdered milk, cotton, agricultural products and buses saw a drop due to the global economic recession.

The Ministry of Industry and Trade has encouraged businesses to use domestic materials in the production of competitive products and continue to implement the campaign “The Vietnamese buy Vietnamese products.”

The Ministry will strictly control the consumer market to iron out snags and ensure a stable supply of crucial products like petrol, fertilizer, steel, print paper, cement, rice and pharmaceuticals.

Firms in the steel industry have decided to accelerate production to meet the high construction demand at year’s end. The Vietnam Steel Corporation and other steel companies have reduced the price of their steel to boost consumption. This shows their confidence in the government’s demand stimulus programme.

Fertilizer companies are going into full production in the preparation for the Spring-Winter crop.

Gold prices edge up following signs of US GDP growth

World gold prices rebounded strongly on October 30, causing the domestic gold prices to increase by VND120,000/tael. The US dollar became weak again when the US GDP grew for the first time after 4 quarters of decline.

Domestic gold was traded on October 30 at VND23.85-23.92 million per tael, up VND120,000/tael from October 29.

Gold trading operations slowed because traders were apparently waiting for decreasing prices to buy gold.

On October 29 gold prices on the New York market bounced back to US$1,042/ounce after the US Department of Commerce announced growth in the country’s GDP for the first time with a drop in unemployment rate.

Vietnam, Turkey to boost economic cooperation

The Vietnam Chamber of Commerce and Industry (VCCI) on October 30 held a “Vietnam-Turkey business seminar” to boost economic and trade cooperation between the two countries.

VCCI chairman Vu Tien Loc said bilateral trade turnover has seen a year-on-year increase of 60-70 percent this year and it is expected to reach US$1billion in 2010.

He added that Vietnamese businesses should promote cooperation with Turkey because it has large potential markets.

Rifat Hisarcikhoglu, the President of the Union of Chambers and Commodities Exchanges of Turkey (TOBB) says that Vietnam plays a very important role in the economic strategy of Turkey and Turkey is eager to cooperate with Vietnam for mutual benefit.

Two-way trade turnover has reached US$251 million but this is still far below the two countries’ potential.

During the meeting, most delegates agreed that the two countries should complete negotiations on investment encouragement and assistance, double taxation avoidance, shipping agreements and customs to create a legal frame for future development.

Also at the seminar, A Vietnam-Turkey business council was founded to help promote trade relations.

US imposes anti-dumping duties on Vietnamese PE bags

The US Department of Commerce (DOC) has passed a preliminary judgment in an anti-dumping lawsuit on Vietnamese polyethylene (PE) bags filed by US bag-makers.

The DOC said that as PE bags from Indonesia, Vietnam and Taiwan are sold at a cut-price level on the US market, it has decided to slap anti-dumping duties of 67.18 – 67.62 percent on bags from Indonesia, 52.3-76.11 percent on products from Vietnam and 28.69 percent to 95.81 percent on those from Taiwan.

Earlier, on August 31, the DOC temporarily imposed anti-subsidised measures on polyethylene carrier bags imported from Vietnam, under which, Advance Polybag will pay a duty of 0.20 percent, Chin Sheng 1.69 percent, Fotai Vietnam Enterprise 4.24 percent and other companies 2.97 percent.

This is the first time Vietnamese export products have had to pay anti-subsidised duties in the US.

The DOC will announce its final decision in the lawsuit on January 11, 2010, and 45 days later the United States International Trade Commission (ITC) will give its final decision. The duties will come into effect only when both the DOC and the ITC have made their final decision (duties will be applied in early March 2010).

On March 31, 2009, two US petitioners (Hilex Poly and Superbag Corporation) accused the makers of plastic carrier bags in Vietnam, Taiwan and Indonesia of dumping and filed an anti-subsidisation lawsuit against the Vietnamese makers with the DOC and International Trade Commission (ITC) through the consultancy of King & Spalding LLP law firm.

In 2008, the US imported about US$79 million worth of plastic shopping bags from Vietnam.

Italian businesses keen to invest in Vietnam

Vietnam has changed remarkably in recent years, according to Italian businesses at a workshop on investment in the Southeast Asian country, which was held in Turin, Italy.

With a population of 86 million, Vietnam has great potential for the Italian business community, said Giovanni Giustetto, President of the Italian Chamber of Commerce in Vietnam.

Meanwhile, the Vietnamese Ambassador to Italy, Dang Khanh Thoai, confirmed that the Vietnamese economy has maintained a high growth in its GDP and remains an attractive destination for foreign investors despite the ongoing global economic crisis.

However, there has been just a modest number of major projects conducted by Italian groups in the country, Mr Guistetto told the workshop.

In 2008, Italy invested a total of US$114 million in Vietnam to rank 31st out of the 81 countries investing in Vietnam, up five places from 2007. Bilateral trade revenues hit US$1.7 billion the same year, an increase of 20 percent against 2007.

The Italian government has agreed to provide 30 million euros in credit for small- and medium-sized enterprises operating in the environmental protection and medical fields in Vietnam from 2009 to 2012.

Italy’s external economic cooperation agencies have said that Italian investors have not received enough support from their government in terms of information and policies. Italian enterprises are short of information on the investment climate and Vietnam’s legal systems as well as other basic knowledge about the country. This is likely to make them less competitive than those from other countries.

Vietnam, UAE inter-governmental committee established

Vietnam and the United Arab Emirates have exchanged documents on ratifying an agreement to establish an inter-governmental committee for cooperation, which was signed in Dubai on February 16.

A ceremony for the document exchange was held by the Vietnamese Ministry of Foreign Affairs on October 29.

At the ceremony, Foreign Deputy Minister Doan Xuan Hung and UAE Ambassador to Vietnam Admed Ali Almualla signed the minutes on the exchange.

The agreement, which is valid as from October 29, will contribute to strengthening the two governments’ cooperation in every field, especially politics, economics, trade and culture, for their mutual benefit.