Vietnam - News

ENERGY - Outlook looks into energy security



One of Viet Nam’s biggest challenges during the next ten years is ensuring energy security, and that means expanding power supplies to keep pace with the nation’s rapidly growing economy.

This month’s issue of our news magazine Outlook examines the Government’s plans on ensuring energy security. The magazine, which goes on sale in Ha Noi, HCM City and other major centres this morning, reports on new hydropower projects such as the massive Son La plant and moves to minimise reliance on imported fossil fuels by fostering biofuel production.

Our cover stories also take a look at development of clean renewable energy sources such as wind and solar power in Viet Nam. Our report on harnessing the sun shows how pioneering farmers are taking advantage of solar power in a cost-effective way, while our survey of wind power takes readers on a visit to the country’s first wind farm in Central Viet Nam.

Also in this issue, we visit a picturesque coastal community tipped to be the next tourism boom town, meet Viet Nam’s "dancing ambassador" and check out HCM City’s late night cafe scene.

Outlook’s regular news round-up summarises the major news developments locally and around the world. Readers can also catch up on what’s hot and not in the country’s culinary, sports and arts scenes - and check out our listings for everything from bars to embassies.

Outlook retails for VND15,000 at news-stands, major hotels and restaurants, at the head office of the Viet Nam News at 11 Tran Hung Dao, Ha Noi street, or at our HCM City office at 120 Nguyen Thi Minh Khai Street. — VNS



FINANCE - Need to improve Vietnam business environment



World Economic Forum (WEF) and World Bank differ on Vietnam's business environment, but the downgrade of Vietnam in world ranking list showed the country still suffers from many problems.

On September 9 in China, WEF announced the Global Competitive Index 2009-2010 in which Vietnam slid five grades from 70th to 75th position, marking the third consecutive year Vietnam was downgraded.

In WEF's 2006-2007 report, Vietnam stood 64th among 122 surveyed economies and then fell to 68/131, 70/134 and 75/133 in following years although the country marked achievements in all ranking standards. But in comparison with Vietnam itself in the past, these achievements did not matter much in the global race.

Macro-economy factors pulled down the grade of Vietnam in the global ranking lists. In terms of macro economy with high inflation, big trade deficit and budgetary overspending, changes in forex rate and interest rates while the country's infrastructure has not been improved, Vietnam dropped 42 grades from 70 to 112. This was the most serious downgrade making Vietnam's Global Competitive Index slump five grades in WEF's 2009-2010 report.

Generally, Vietnam's basic standards subject to WEF's ranking list were worse, especially the unsustainable macro-economy.

At the same time, World Bank also released its Doing Business 2010 report saying that Vietnam showed big progress in business environment after climbing seven grades from last year's 39th position to 32nd in aspect of contract implementation.

But in general through considering other nine standards, Vietnam declined two grades from 91st to 93rd among 183 ranked economies.

In fields of corporate establishment and tax payment, Vietnam slid from 109 to 116 and from 140 to 147 correspondingly.

Three standards seeing the 3-grade drop of Vietnam in the report are labour usage from 100 to 103rd, assets registration from 37 to 40, and credit access from 27 to 30 while the country's construction license standard plunged two grades from 67 to 69, investor protection from 171 to 172, cross-border commerce from 73 to 74 and corporate bankruptcy from 126 to 127.

Notably, all ranking standards of Vietnam are getting worse, especially procedures of liquidating and setting up companies, investor protection, tax payment, and labour.tuanvn



SHIPBUILING - Vinashin and Vinalines plan to build 40 ships

Prime minister has approved a plan of Vinashin and Vinalines to build 40 ships from the funding of Vietnam Development Bank (VDB).

First off, the two enterprises must comply with the Decision No 10/2009/QD-TTg dated January 16, 2009 ruling on the scheme of funding key mechanical product development and list of key machinery products in period of 2009 to 2015.TBKT



EDUCATION – Viet Nam aims to learn from the best overseas universities



HA NOI — Learning from the experience and success of well-known international universities was important for the renewal of Viet Nam’s education sector, Deputy Prime Minister Nguyen Thien Nhan said here yesterday.

Nhan, who is also the Minister of Education and Training, was speaking at the first Viet Nam-Japan Rectors’ Conference. The two-day function finishes today.

"The quality of tertiary education in Viet Nam is still low and has not met the demands of development,so we are working hard to find solutions for a total renewal for the sector," Nhan said.

He said the target for the coming academic year was a renewal campaign in training, managing and financing - and that to achieve it, international co-operation and experience played an important role.

The two-day conference aims at Vietnamese universities exchanging high quality education experiences and management with those in Japan.

About 50 representatives from Vietnamese universities and 40 from Japanese universities attended.

The Japanese Government has helped Viet Nam build 256 primary schools in 21 provinces. It has also helped improve training, science research and provided annual scholarships.

Up to date, more than 100 Vietnamese universities have co-operation programmes with Japanese universities.

"Such successful co-operation has helped Vietnamese universities improve their training to gradually meet international standards," said Tran Thi Ha, director of the Higher Education Department under the Ministry of Education and Training.

Also, she said, co-operation programmes had helped train high quality management staff, researchers and lecturers.

Viet Nam is one of Japan’s most important partners in education co-operation, according to Shigeharu Kato, deputy director general of the Higher Education Bureau at Japan’s Ministry of Education.

According to the rector of University of Da Nang, Bui Van Ga, co-operation with Japanese universities, as well as with other foreign universities, offered a great chance to quickly improve training and management.

However, according to Tran Thi Ha, there were still problems that needed tackling.

Lack of instructions from the Ministry of Education and Training led to co-operation in training courses or fields that did not meet the needs of Viet Nam’s urgent socio-economic development.

The conference also touched on the need for Viet Nam to establish international universities with help from local universities and foreign partners.

Viet Nam currently has no institution on the list of the world’s best 200 universities, according to Deputy Prime Minister Nguyen Thien Nhan.

However, he said it planned to have five international-standard universities by 2025. The Da Nang International University project is one among them.

He expected that Japan would become the partner for Da Nang International University. — VNS

POWER - Work on Upper Kon Tum hydropower plant project to start

Vinh Son-Song Hinh hydropower Joint Stock Co (coded VSH) announced that the company would start the construction work on Thuong Kon Tum hydropower plant project with designed capacity of 220MW on Dak Nghe River, Kong Plong Dist, Kon Tum province.

Thuong Kon Tum hydropower plant project was included in the general electricity development plan No 4 to be built in two provinces of Quang Ngai and Kon Tum. The plant with total investment value of over 5.7 trillion dong will supply annual electricity output of over one billion KWh. The plant is expected to start operation in 2014.

At present, Vinh Son-Song Hinh hydropower Joint Stock Co has prepared for capital raising methods for the project such as the company's available profit, preferential loans from Vietnam Development Bank, issuing shares to increase VSH's chartered capital, issuing corporate bonds, commercial loans via export credit.

The company has concentrated on carrying out construction work of provincial road No 676 from KonPlong, intersection and connection road from Son Lap-Ngoc Tem to the entry road of the hydropower plant, and upgrading work of 22KV electricity line from Son Ha to the construction site in order to supply electricity for the project.TBKT







RAILWAY – TRANSPORTATION - Capital raised from private sector for north-south express railway



The fourth workshop on North-South express railway was held in Hanoi on September 15 by Vietnam Railway Corp in cooperation with Japan Overseas Rolling Stock Association (JORSA).

According to a recent research by Japan International Cooperation Agency (Jica) on sustainable development of Vietnam's transport system, developing the north-south express railway system is very important. However, if the investment is up to $38 billion (that does not mention expenses for purchasing locomotives, standby expenses and tax), putting in use of this express railway is infeasible, said Jica.

Jica analysed that regarding people's incomes, if clients travel from Hanoi to HCM City for 5.5 hours instead of some 30 hours as currently, the ticket price for the express train is also as expensive as the air ticket while it takes only one hour and 45 minutes to travel from Hanoi to HCM City by airplanes. This demonstrates that the express railway can compete to the airlines in medium distances but as for the 1,500 kilometre distance, the airlines have more advantages.

Thus, building the express railway in a complete manner and putting into use will not be good. Jica suggested developing the project based on different routes; particularly the top priority should be given to the routes having a large number of clients so that the project will not run at a loss.

Sharing the same opinion, many people agreed that at first the project should build some priority routes such as Hanoi-Vinh ($7.2 billion), Hanoi-Thanh Hoa ($3.9 billion), HCM City- Nha Trang ($9 billion), HCM City - Phan Thiet ($3.7 billion), Da Nang – Hue ($2.2 billion). This is the five routes that are considered to have a large number of frequent travellers. A representative from Jica said that if the express railway is operated well, revenue from tickets may compensate for expenses of developing the above medium-distance routes.

In addition, some experts said that losses may be avoided by delaying the development of the north-south express railway. If the express railway is developed too early when the urbanisation has not yet met the development of the express railway properly, the project will find it hard to collect capital and will be vulnerable to big losses because the investment into infrastructures, machines, services is too high.

Many people said that at first, the above five routes should be run on a trial basis in 2020. The common ticket price should be a half of the air ticket price.

In a recent visit to Japan by prime minister Nguyen Tan Dung, Japan agreed to offer part of ODA to Vietnam's developing the north-south railway project. However, because of high investment of the project, experts said, raising private capital for the project is necessary.

Regarding the capital attraction for the project, representatives from Japan External Trade Organisation (JETRO), Ministry of Economy, Trade and Industry (METI) said that with such high investment, the project will be split into small packages so businesses, organisations can access.

Those organisations said that this is a national-level large project; hence, it will surely be attractive to individuals who are seeking good investment opportunities. (Regarding medium terms, the project will gain stable profits).

As planned, the private capital will focus on some sectors as trading inside train stations, operation, and maintenance and so on. Meanwhile, the state capital will concentrate into building infrastructure, rails, site clearance and others.

Additionally, METI's experts also mentioned both private and state sectors should share risks when developing the project such as incurred expenses, slow site clearance, economic, political, environmental risks and others.TBKT





INSURANCE - Bao Minh Insurance reports to gain 1.29tr dong of revenue in Jan-Aug



Bao Minh Insurance Joint Stock Corp (coded BMI) has announced the company's business reports in August and for the whole eight months of this year.

Up to August 31, the company's progressive revenue was reported at 1.291 trillion dong, equal to 66.4 percent of the year plant and down 1.8 percent year-on-year.

There was a reduction in maritime insurance, meanwhile the other types of insurance reported to increase.

In August only, the company's revenue was posted at 154 billion dong, over 4.5 billion dong higher than that in July.

In details, maritime insurance had a decrease in revenue by 4 percent against the same period of last year. The revenue from insurance for motored vehicles increased by 0.9 percent and assets insurance was up 12.9 percent. The group of re-insurance products was reported to reach the highest growth rate of 23.3 percent

The compensation rate in the first eight months of this year was estimated at 756 billion dong, counting for 58.5 percent of the revenue. Last year, the rate was 49.2 percent.

The accumulative fund management charge in Jan-Aug, salary fund inclusive, was 233 billion dong, equal to 18 percent of the company's revenue.CafeF





BOND MARKET - Maritime Bank finishes issuing long-term bonds valued 2.1tr dong in 2009





Pursuant to Decree No 52/2006/ND-CP dated May 19, 2006 by the government regulating about issuing corporate bonds, Document No 1353/QD-NHNN of the state bank of Vietnam dated June 3, 2009 about allowing Maritime Commercial Joint Stock Bank (Maritime Bank) to issue corporate bonds, Maritime Bank has lately reported to finish issuing long-term corporate bonds in 2009 of two-year term and five-year term, coded MSB Bond 2009.

The total value of the issued bonds was 2.1 trillion dong, which included 1.8 trillion dong of two-year bond and 300 billion dong of five-year bonds.

The bonds were issued under the individual issuing method, with floating coupon rate to be identified every year. The par value of the bond was one billion dong.

The principal will be paid once on maturity date and the coupon paid annually.

FPT Securities Joint Stock Co was in charge of providing consultancy services and issuing the bonds as well as the bonds depository and payment agent.CafeF





POWER - EVNFinance finances 130b dong to Thac Ba hydropower plant



EVN Finance Joint Stock Co (EVNFinance) yesterday signed a contract of providing a loan of nearly 130 billion dong for Thac Ba Hydropower Joint Stock Co (coded TBC) to overhaul the 108 MW turbine No 3 with an average electricity power output of 400 million kWh.

Currently, EVNFinance now holds 21 percent in TBC as one of the strategic shareholder of the power producer.

To date, EVNFinance has disbursed directly approximately 1.2 trillion dong of loans to the power companies.

Up to June 30, total assets of EVNFinance reached 8.641 trillion dong, total deposits of 5.418 trillion dong, total outstanding loans of 1.428 trillion dong, total revenue of 298 billion dong and a pre-tax profit fulfilling 56 percent of the full year's plan.TBKT





STOCK EXCHANGE - VN Index keeps increasing while HNX Index turns to dip



VN Index continued rising on the six consecutive session today Sep 17 while HNX Index reversed to decline.

Today, on the southern floor, VN Index marked its sixth increasing session with a jump of 4.21 points or 0.76 percent to close at 561.19 marks. The market liquidity remained high when the buyers still hoped for new peak to be conquered and the sellers tended to take profit. The total matching order trade was recorded at 73.34 million shares for over 3.636 trillion dong, up 9 percent in volume and 11 percent in value against the previous session.

Among 170 share codes and four fund certificates listed on the market, there were 69 codes accelerating, in which 18 codes rose to ceiling price, 75 codes dropping and 30 codes staying unchanged at the comparative price.

Among the large cap share codes, VNM recorded a ceiling rise of 8,000 to 172,000 dong per share. The other point-gainers included HAG +3,000 to 90,000; FPT +4,000 to 119,000; STB +1,100 to 32,700; and VCB +1,000 to 56,000 dong per share. Meanwhile, BVH, CTG, PVD, PVF and SSI dipped.

In terms of trading volume, STB's share volume increased by 10 times higher than the previous session with 15.85 million units being transferred. Ranking at the second place was SSI with 3.12 million, followed by VCB with 2.19 million, GMD with 2.16 million, VF1 with 1.91 million, HAG with 1.9 million and SAM 1.84 million shares changing hands.

On the northern market, HNX Index dipped by 0.19 point or 0.11 percent to end at 174.68 points with a total market trade of 40.84 million shares worth 1.492 trillion dong. HNX







AVIATION - Vietnam Airlines offers cheaper airfares



Vietnam Airlines plans to launch a cheaper airfare plan. The airline has decided to reduce airlines tickets by 60-70 percent within October 2009 in order to stimulate the travelling by air.

Nguyen Thi Minh Yen, director of Vietnam Airlines' southern region announced in the press conference to prepare for holding the fifth International Tourism Exhibition (ITE HCM City 2009) held in HCM City on Sep 16.

She added that Vietnam Airlines would offer 60-70 percent of reduction for all the airfares of international and domestic flights from October 1, 2009 to January 31, 2010. However, the air tickets would only be sold in promotion programme lasting from October 1-20.

There would be no limitation of the number of customers participating in the promotion programme in every flight. However, the customers cannot get the refund for the airfares they have bought if they cannot board in.

Yen added that this special promotion programme was to help the tourism demand stimulation programme in difficult economic situation at present.

It is considered the most attractive promotion programme that Vietnam Airlines has introduced to the public up to now. The customers may make reservations for buying air tickets in the exhibition or via online booking services in Vietnam Airlines' website.

The main theme of the fifth ITE HCM City 2009 is "Vietnam-Laos-Cambodia: three countries, one destination". This even will officially take place from October 1-3 at Phu Tho Gymnasium, Tan Binh Dist, HCM City with plentiful activities in order to create favourable conditions for domestic and foreign tourist to meet with the travel agents.

La Quoc Khanh, vice director of HCM City Department of Culture, Sports and Tourism said in the press conference that although Vietnam's tourism industry has suffered bad effects from the global economic recession, the total amount of foreign travellers to Vietnam in the past nine months was about 2 million people, down 11 percent year-on-year but that of domestic tourists increased by 13 percent, causing the industry's revenue jump by 9 percent.

There are 150 international tourism firms from 25 countries and territories to participate in the exhibition, together with over 300 domestic travel agents. Up to now, over 1,200 international tourists have booked for tours to Vietnam on the occasion.

In addition, ITE 2009 will attract the participation of foreign tourism promotion organisations of India, South Korea, Malaysia and Thailand.CafeF







DEEP SEA PORT - Van Phong international transit port starts up

17/Sep/2009 Intellasia | Saigon Giai Phong

Khanh Hoa provincial People's Committee has decided to start work on Van Phong international transit port by the end of this October through building two deep water ports in Dam Mon area (Van Phong Gulf of Khanh Hoa province).

After being built, the two deep-water ports can receive 9,000 TEU container vessels.

The total expense for the starting period is estimated at one trillion dong sourced from Vinalines. The started projects were designed by Nippon Koei and Port Coast.