Banking & Finance
- HCM City to develop its bank services

Investment
- MPI revokes license of Dankia-Suoi Vang

Import - Export
- Seafood yields nearly $700mil in 4 months
- Outbound sales of bicycles down
- Aquatic exports to Japan increase 48%

Stock market
- Taya Vietnam ready to auction shares
- More incentives for businesses registered at Hanoi bourse

More business news
- New ADB president praises Vietnam development goals
- VN looks to double per capita GDP by 2010
- U.S. insurer vows to support Vietnam's WTO bid

Vietnam in close-up

Banking & Finance

HCM City to develop its bank services

HCM City's banking system aims to provide high-class banking services to compete with those of neighbouring ASEAN nations. The plan is part of a broader effort to develop and improve the city's banks during the 2006-2010 period.

According to a draft of this strategy, banks operating in HCM City will be built around a strong central banking system and armed with added capital and more modern technology.

The system will be modernized in order to better serve payment services and intra-bank monetary markets, adding that his system will be enlarged to add several financial services outside Vietnam, said Tran Ngoc Minh, director of the State Bank's HCM City branch.

During the 2006-08 period, the system will continue to perfect and enhance the quality of its banking services, including property custodial services and management, credit assistance and payment. In the second period from 2009-10, HCM City's banking system will develop electronic payment services, remittance services, card payments inside or outside the country, monetary brokerage and property management services.

At the same time, the Government will submit the Law on Electronic Transactions to the National Assembly for ratification in order to create more favourable conditions for e-banking transactions.

The SBV will also continue to create a legal environment for banking operations in accordance with international standards, creating a level playing field for both Vietnamese and the U.S. financial institutions.

Regulations on foreign currency management and the rate of exchange will also be revised following the liberalization of current transactions. The move will allow Vietnamese dong to be exchanged liberally and will phase out restrictions on purchasing foreign currency.

As part of this itinerary, credit institutions in HCM City should continue increasing their reserve capital. Joint stock and small- and medium-sized commercial banks must reach a minimum capital level of VND150 billion. Large-sized commercial banks, meanwhile, must hold capital of at least VND650 billion by the end of this year. (VNS)

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Investment

MPI revokes license of Dankia-Suoi Vang

The Ministry of Planning and Investment (MPI) has revoked the license of the Dalat-Dankia Holding Ltd, the owner of the long-delayed project Dankia-Suoi Vang resort, in Lam Dong province.

This is the final decision on the US$706-million project, which has been delayed for eight years as the cash-trapped investors could not afford the costly project in the wake of the Asian financial crisis in 1997.

The Dalat-Dankia Holding Ltd is a joint venture between three Singaporean companies Natsteel, Jurong Environment Engineering and LKN Management Service, and Lam Dong Tourism Co.

The foreign partners were to contribute 65% of the capital, while the Lam Dong Tourism Co. would contribute the rest in the form of land use right. The resort was planned to have a horse-racing track, a golf course, a cable-car system, tennis courts, bungalows and other auxiliary facilities.

Under the license, the resort should cover 5,000 hectares, including 3,000 hectares of forest. Construction was to be completed in 15 years.

After several times breaching deadlines, the investors were given until January 2005 to have a final say on whether they would continue building this project. "But they did not continue. Finally the MPI has decided to revoke its license," a provincial official of the Central Highland province said.

In fact, Japanese investors are seeing to the possibility of taking over the project. "Some Japanese companies have said they would spend about US$1.2 billion on the Dankia- Suoi Vang project. They wanted to build a resort," he said, adding work can begin early next year for completion after ten years. (SGT)

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Import - Export

Seafood yields nearly $700mil in 4 months

Vietnam's seafood exports in April generated an estimated US$190 million, taking the total in the first four months of this year to US$684.5 million, or an increase of 8.9% year-on-year, according to the Ministry of Trade.

The ministry said fish made the biggest contribution to exports, accounting for 45.4% with more than 68,800 tonnes, followed by shrimp with 34,900 tonnes and cuttlefish with 14,400 tonnes.

Japan is the largest consumer of Vietnamese seafood with imports totaling US$146 million in the first quarter, followed by the U.S. with US$121.5 million, and the EU with US$69.4 million. However, fish exports stateside was 14.5% lower than in the first quarter of 2004.

Deputy Minister of Fisheries Nguyen Viet Thang said the country faced many difficulties exporting to the U.S., due mainly to anti-dumping tariffs imposed on Vietnamese basa and tra fish and recently shrimp.

The ministry has therefore asked local firms to seek for more outlets in the Middle East, Eastern Europe, Africa and South America for their exports.

The sector aims to obtain US$2.6 billion from exports for the whole year, up 8.7% over last year. (SGT)

Outbound sales of bicycles down

Outbound sales of Vietnam's bicycles and bike parts fell by 29.3% year-on-year to US$61 million in the first four months of this year, mainly due to stronger competition and an anti-dumping probe in Canada, an official said Wednesday.

"Changes on the world market coupled with competition and antidumping investigation are to blame for the sharp fall," said Le Anh Tuan, vice chairman of the Vietnam Bicycles and Motorcycles Association (VBMA).

Tuan explained the Canadian market used to consume about 10% of Vietnamese bicycle exports, but sales there have come to a standstill after the anti-dumping investigation.

Most major bicycle manufacturers are Taiwanese-invested, Tuan said, adding eight enterprises that have exported bikes to Canada were now involved in the probe prompted by the anti-dumping lawsuit lodged by Canadian firms.

"The VBMA has employed a Taiwanese law firm as the legal representative for the Vietnamese-based manufacturers in this case," he added.

Last year, the European Union carried out an anti-dumping investigation against nine bicycle makers in Vietnam, including two local manufactures and seven foreign-owned manufactures. However, tariffs on imported bicycles from Vietnam to the EU did not changed much in the aftermath. (SGT)

Aquatic exports to Japan increase 48%

Earnings from aquatic exports to Japan in the first four months of this year are estimated at US$180 million, a 48% increase compared to the same period last year, according to the Ministry of Fisheries.

The figure, representing 31.4% of the country's aquatic export value in the same period, is expected to reach US$700-800 million this year, and US$1-1.2 billion in 2010.

To this end, the fisheries sector is to ship between 25-30% of its aquatic product export output to the Japanese market, while introducing new products.

It is forecast that Japan's shrimp imports will increase by 2.3-3% a year in the coming years, and its imports of frozen cuttle-fish is expected to stand at 46,000-48,000 tonnes in 2005, and 62,000-67,000 tonnes in 2010. (VNA)

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Stock market

Taya Vietnam ready to auction shares

The Taiwan-owned electrical wire and cable maker Taya Vietnam has rescheduled its initial public offering for May 27 after a failed attempt to auction shares late last month.

The company will release 2,440,150, or more than a seventh of the total 18,267,627 shares. The starting price is set at VND18,000 on the book value of VND13,400 and the face value of VND10,000.

If all the issued shares are sold, outsiders will hold 15%, while the two founders - Taya Group and Dai Trien - will retain 80% and their employees the remainder.

All investors can register for Taya shares between now and May 24 at the HCM City and Hanoi securities trading centres and Taya's consultancy Bao Viet Securities.

Taya will give investors more details about the offering at the Sofitel Plaza Saigon at 17 Le Duan Boulevard in HCM City's District 1 next Thursday and at the Melia Hanoi at 44B Ly Thuong Kiet street in Hanoi two days after that.

The share offering was delayed because Taya earlier consulted Bao Viet Securities for the auction but the latter then wanted to underwrite the issue so Taya needed time to decide to refuse Bao Viet Securities' offer.

Taya's revenue is expected to grow more than 30% this year but its profit is forecast to fall to VND47.7 billion because of increasingly expensive materials. Last year, the company generated revenue of VND465.5 billion and net profit of VND56 billion.

Taya, which has chartered capital of VND183 billion, has a factory in the city's neighbouring province of Dong Nai and is building another one in the northern province of Hai Duong. (SGT)

More incentives for businesses registered at Hanoi bourse

The Ministry of Finance (MoF) has recently unveiled a plan to offer tax incentives for organizations registering for securities transactions at the Hanoi Securities Trading Centre.

Under the plan, organizations registering for securities transactions at the Hanoi bourse would enjoy a 50% reduction in corporate income tax for two years.

In addition, these organizations will also be given the same incentives on corporate income taxes as those listed at Ho Chi Minh City's Securities Trading Centre.

Although still awaiting the Prime Minister's official regulations in this field, the MoF said the move is aimed at encouraging organizations and businesses to register for transactions and list their shares on the securities market. (VNA)

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More business news

New ADB president praises Vietnam development goals

The new president of the Asian Development Bank (ADB) has applauded the Vietnam Development Goals (VDGs), which he said are directly linked to the internationally accepted Millennium Development Goals (MDGs) and are tailored to the circumstances of the country. More »

VN looks to double per capita GDP by 2010

Prime Minister Phan Van Khai has said Vietnam will make an effort to double its per capita gross domestic product (GDP) in the next five years.

GDP is forecast to reach US$600 per capita this year and the country with a population of over 80 million will take measures to ensure the figure will rise to US$1,000 by 2010, he told a recent donors conference in Hanoi.

The major economic achievements cataloged by the Government leader include average annual economic growth of 6.9% in 1996-2000. The growth rate is expected to leap to 7.5% on average in the first half of this decade. Investment in the economy is seen making up 37% of GDP this year, up from the 34% in 2001, with the private sector contributing 26%.

The nation's economic achievements are attributable partly to international aid. Foreign donors pledged US$14.7 billion in official development assistance (ODA) for Vietnam in 2001-05, with US$8.7 billion disbursed.

These capital resources have led to a great change for the better for the entire nation, said Khai, adding that self-reliance and international assistance had helped the country beat its target on poverty reduction set by the Millennium Conference.

Some 3 00,000 people in the nation's poorest communities have escaped poverty a year and many have even prospered owing to Government- and international-funded projects designed to provide them with start-up investments, and training courses on life skills and marketing support.

UNDP Resident Representative Jordan Ryan described Vietnam as an exceptional case, saying the country had made a great stride forward in the past 10 years. Vietnam's amazing economic growth, poverty reduction, and improvement in education and healthcare are huge achievements according to any standards, he said. (SGT)

U.S. insurer vows to support Vietnam's WTO bid

U.S. insurance group New York Life is confident of Vietnam's prosperity and vows to support Vietnam's bid to enter the World Trade Organization (WTO), a firm official said Wednesday.

Fred Silvert, head of a visiting delegation from the New York Life Insurance Company, said that once Vietnam becomes a WTO member, his company will enjoy more favourable conditions for operating in the country.

He told Vietnamese Deputy Prime Minister Nguyen Tan Dung in Hanoi on May 4 that he believed Vietnam's insurance field would develop, describing the country as a promising market.

Deputy PM Dung spoke highly of New York Life's contribution to the development of Vietnam-U.S. ties.

He expressed his hope that with its role and influence, the U.S. group would help push the two countries' negotiations over Vietnam's admission into the world trade body. (VnMedia)

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