Vietcombank raises interest rates for US dollar deposits

Vietnam’s largest commercial bank, State-owned Vietcombank, has decided to raise its interest rates for U.S. dollar deposits for the third time this year by 0.2 to 0.4% a year as of April 5. Rates for two-month, three-month and six-month deposits in U.S. dollars have increased to 2.3, 2.6 and 2.85% a year respectively.

This is the third time Vietcombank’s U.S. dollar deposit rates have risen in three consecutive months. In March, the bank increased its rates by 0.2 to 0.4% a year.

Vietcombank has also decided to boost rates for Vietnamese dong deposits by 0.36 to 0.96%. (TN)

Investment

VN climbs four points in investment credibility rankings

Vietnam has climbed four points from 54 to 50 in the investment credibility rankings, compared to a survey conducted by the Economist Intelligence Unit (EIU) five years ago.

Sixty countries involved in the survey account for more than 95% of the world's trade and foreign direct investment volume.

Demark is the best place in the world for businesses in the next five years as it has liberal policies, flexible labour market, high intellectual level, transparent tax and financial policies, effective government structure and perfect transport network. Canada and the U.S. rank second and third, respectively. Singapore and Hong Kong are the best places in Asia and placed fourth and fifth respectively in the world.

Far behind are other countries in Asia: Taiwan (18), the Republic of Korea (19), Japan (28), Malaysia (31), Thailand (32), the Philippines (40), China (41) and Indonesia (45). (SGT)

Foreign investors may get to buy land rights at auction

A proposal to allow foreign investors who wish to acquire Hanoi land-use rights by an auction process is in the pipeline, said a senior official from the Hanoi Land Fund Development Centre.

The centre's director Cao Xuan Minh confirmed that the centre, under the umbrella of the Hanoi People's Committee, was working with city's Planning and Investment Department and other relevant authorities on the project, which is designed to improve the local investment environment.

Foreign investors demand for land for certain business purposes is growing, but under current laws covering land use rights they are not allowed to purchase the land, said Minh.

Under the centre's plan, foreign businesses must present an approved investment project and other necessary legal procedures prior to gaining permission to enter the land auction. However, Minh said the plan is still under consideration, and no exact deadline has been set yet.

"The advantage here is that investors, be they domestic or foreign, will not have to worry about the ground clearance, which is seen as the most difficult and time-consuming process," he said. "We will settle the ground clearance and other related works before the auction, and the investor will just start their business."

The centre will auction five land lot totalling 50ha in the city's districts of Dong Anh, Long Bien, Tu Liem and Cau Giay this year. (VNS)

Kinh Do set to issue 500,000 new shares in May

The Kinh Do Corp. has said it will sell 500,000 new shares to raise funds for a new confectionery factory. General director Tran Le Nguyen said the issue would be launched in May, targeting both existing shareholders and outsiders.

Kinh Do prefers selling shares to its distributors and material suppliers or anyone who will help better its management, he said, adding foreign investors would be eligible to buy.

The board of directors will meet next week to decide the price and volume of shares to be sold, he said.

In January, VinaCapital's Vietnam Opportunity Fund (VOF) invested US$5 million in Kinh Do through a secondary purchase, becoming the first foreign investor to hold a stake in a Vietnamese confectionery company.

Kinh Do will raise its registered capital to VND250 billion (US$16 million) after the issue is completed.

The capital increase will enable it to finance a project to build a 13-hectare factory in the Vietnam-Singapore Industrial Park in HCM City's neighbouring province of Binh Duong, Nguyen said.

Kinh Do will list its shares on the local stock exchange some time this year. After that, it will merge with the bourse-listed North Kinh Do, which now has VND50 billion in chartered capital with Kinh Do holding almost half of the shares. (SGT)

Joint venture to open cinema complexes

Vietnam's Phuong Nam Co. and Envoy Partners Ltd. based in the British Virgin Islands have got the go-ahead for their joint venture to build cinemas in Vietnam.

The Megastar Media Joint Venture, which got a 25-year license from the Ministry of Planning and Investment, is capitalized at US$8 million, with the local partner holding a 20% stake and the foreign side the rest.

The venture is due to open its first cinema complex at the Vincom City Towers in Hanoi in this year's third quarter. Located on the sixth floor, the complex will have eight cinemas with a total of 1,100 seats.

In HCM City, the company will build a cinema complex at Hung Vuong Plaza at 126 Hung Vuong street in District 5.

All together, Megastar Media will build eight complexes in Vietnam. A complex will house eight to 12 cinemas, seating a total of 1,500 people, a fast food restaurant, a game section, and a bookstore.

The company also has permission to import movies into Vietnam.

Megastar Media is the second joint venture in Vietnam to open cinemas and import movies after Diamond Cinema, a 10:90 joint venture between Fafilm Vietnam and Good Fellas, which has 37 cinemas in the Republic of Korea. (SGT)

Import - Export

Delay of quota rules irks garment industry

The ministries of Trade and Industry have issued an inter-ministerial circular governing quota transfers for garment companies exporting to the U.S., but business leaders have complained that a delay in the Government's official recognition of quota trading has cost them money.

The release of the circular was delayed by one week due to the fact that both ministries had to consider trade rules very carefully so as to avoid any abuse of regulations, said a Ministry of Industry official.

Due to the delay, Circular No.06/2006/TTLT-BTM-BCN will come into effect in more than two weeks, which fails to meet garment manufacturers expectations.

At present, demand for quota transferring between firms is high because fluctuations in the markets for various categories of goods occur on a yearly basis.

The Government agreed to allow companies to trade quotas on different goods and items nearly two months ago. Under the rules, enterprises are only allowed to transfer "export-record" quotas and quotas between companies in each group, which usually comprises five exporters.

The company's "export-record" quota is based on its export capacity for each clothing category to the U.S. during the previous year. However, the exporters must exchange quotas directly and no intermediaries are allowed to be involved.

Any businesses trading in quotas will have to report the transaction to the local Ministry of Trade officials. If the companies do not use all the transferred quotas, they are not permitted to hand the unused quotas over to other firms, they are required to inform the two ministries.

The information on quota transferring or trading will be updated on the websites of the Ministry of Trade, www.mot.gov.vn, and the Vietnam Textile and Apparel Association, www.vntextile.com. (VNS)

1st batch of herbal tea to be exported to Australia

The Hung Phat Tea Company in Ho Chi Minh City is preparing to export the first batch of herbal tea bags, worth US$44,000, to Australia.

Director of Hung Phat Company, Le Thanh Hung, said Vietnamese herbal tea would be sold in Australian super markets together with similar products from China.

In an effort to expand the market for tea export, the Vietnam Tea Association has asked businesses to ensure healthy competition and improve the quality of export products to meet customers' demands, while increasing the rate of processed tea exports. It also mentioned the work being done to advertise Vietnamese trademarks. (VNA)

Q1 garment & textile exports earn $950mil

Vietnam earned US$950 million from textile and garment exports in the first quarter of this year, a 2.9% year-on-year increase but much lower than the targeted 18.6% growth, announced the Ministry of Industry.

Except for slight increases in the U.S. and Japanese markets, textile and garment exports showed decreases in most other markets, particularly in the EU, where Vietnamese exporters are facing difficulties due to the EU's tax reduction and exemption for tsunami-hit countries.

Textile and garment exports to the U.S. earned US$300 million, a year-on-year increase of 3.7%. At the current pace, the target of exporting US$1.2-1.4 billion worth of textiles and garments to this market in the first half of the year will be difficult to reach.

The ministry is instructing textile and garment enterprises to review all groups of competitive products and take measures to reduce costs and improve their competitiveness.

The Vietnam Textile and Apparel Association has been told to boost their role as a link between domestic enterprises and retail groups in the U.S. and the EU, and to help exporters take part in international fairs for market development. (VNA)

Vietnam wins contracts to export 1.2 million tonnes of rice

Vietnamese rice exporters have won contracts to export 200,000 tonnes of rice to the Philippines, the Middle East and southern American countries during the first days of April, announced the Ministry of Agriculture and Rural Development (MARD) on April 4.

This has brought the total volume of rice to be exported under contracts to 1.2 million tonnes so far this year, doubling that of the same period last year.

In addition, Viet Nam's rice export prices have recently increased US$45 per tonne to approximately US$300 per tonne. The rice prices will contineue to increase slightly in the coming period.

In the first quarter of 2005, the country exported totally 961,000 tonnes, earning US$260 million, respectively, according to the Ministry of Trade.

The ministry said although rice exports in the first quarter only made up 83.5% of the volume exported in the corresponding period last year, total export value rose by 2.6%. On average, a tonne of rice was traded at more than US$270.5, up 23% from a year ago. (VnMedia)

More business news

Foreign arrivals to HCM City up 21%

Ho Chi Minh City welcomed 586,564 foreign arrivals in the first quarter of 2005, up 21% over the same period last year.

Of the figure, holiday makers accounted for 280,211; overseas Vietnamese, 138,683; and the remainder, businessmen, mainly from the U.S., Japan, Taiwan, Australia, the Republic of Korea, France, Canada, the UK, China, and Singapore.

The increasing number of tourists was attributed to HCM City's various tourism promotion activities, including those on foreign TV as well as on the Internet.

The city coordinated with the Malaysian Television to broadcast a game show, and with the U.S. Public Broadcasting Service (PBS) to air a culinary show called "Let's get cooking with Tommy Tang" in order to introduce its tourist attractions. (SGT)

Seminar on WTO opens in Hanoi

A four-day seminar on the World Trade Organization (WTO) and the necessary reforms for Vietnam once it is admitted to the world's biggest trade body opened in Hanoi on Apr. 4.

During the first day of the seminar, co-hosted by the National Academy of Social Science (NASS) and the World Bank (WB), presentations were made about the WTO and the Doha Negotiation Round, policies to develop industries and lessons to be drawn from other countries and the Governments' supportive policies.

According to Martin Rama, an expert from the WB, the WTO membership will offer an important opportunity for Vietnam to accelerate its reforms and make basic changes to institutions regarding Vietnamese businesses. Vietnam should move to adjust its policies and introduce reforms in the country in parallel with its process of entry into the WTO.

Prof. Do Hoai Nam, president of the NASS, said Vietnam is boosting its negotiations to join the WTO by the end of 2005. The country has so far completed nine rounds of multilateral talks and is preparing for the next round, scheduled to take place in Geneva, Switzerland, next May.

Vietnam has also completed bilateral talks with six WTO member countries and is actively negotiating with remaining partners among the 27 partners which have registered for bilateral talks with Vietnam. The latest rounds of bilateral negotiations between Vietnam and the U.S., Canada and China yielded positive results, Nam said.

He went on to say that Vietnam is working on a plan for socio-economic development in the 2006-2010 period, with the focus to be put on pushing up the economic growth in harmony with its quality, boosting poverty reduction and actively integrating into the world economy. (VNA)