Thread: Latest news on the Dong!

Sri Lankan group to launch apparel investment in Vietnam
Sri Lanka’s Daya Group is set to enter a joint venture apparel investment project in Vietnam to maintain its competitive edge in the global garment market, a group executive said.

“The Vietnam project will start in July this year. We signed the MOU for the joint venture in March,” said Chairman of the Daya Group, Daya Gamage.
The company says the decision to expand into Vietnam is based on Vietnam’s lower production costs and logistical advantages.

“We selected Vietnam for a number of reasons. Production and transport costs in Vietnam are lower than in Sri Lanka. Also Vietnam has a very young, hard working labor force and the investment regulations and laws are very investor friendly,” explained Gamage.
Vietnam joined the World Trade Organization this year and as a result Vietnamese garment and textile exports to the world are now quota-free and unrestrained.
Given its strong production capabilities the country is expected to become a strong contender in the international garment and textile markets.
Sri Lankan garment producers meanwhile are facing an environment of increasing domestic costs and increasing external competition.
Source: The Sunday Times

Banks of China, Vietnam tie up for cooperation
The Import and Export Bank of China (China Eximbank) and the Vietnam Development Bank (VDB) have concluded a memorandum of understanding (MoU) to boost cooperation between the two countries.

Following the MoU signed Saturday, China Eximbank and VDB will seek cooperation opportunities in engineering, the high-tech sector, energy and raw materials in both Vietnam and China, or in a third country invested by the two parties.
The MoU also enables the two lenders to promote investment in energy and infrastructure projects and facilitates enterprises from both to implement projects in selected fields.
China Eximbank - one of China’s key policy banks to support the import and export of machinery, electronics and new- and high-tech products - reported net profits up 23 percent to 885 billion yuan (US$115 billion) last year.
At the end of 2006, the bank had 403 billion yuan ($52.3 billion) in gross assets, up almost 15 percent.
Established in 2006, the Hanoi-based VDB was tailored to implement state policies on development investment credit and export credit activities and its operations are not for profit.
VDB, with a chartered capital of VND5 trillion (US$312 million), has an obligatory reserve rate of 0 percent while the government provides financial backing and tax exemptions.
The bank is directed to work together with the Vietnam Bank for Social Policies, to assist poverty reduction projects like construction of irrigation and rural transport networks, traditional village infrastructure, and socio-economic infrastructure in remote areas.
The bank will issue bonds, mobilize capital for projects, and ensure efficient administration, credit quality, and low rate of non-performing loans.
Guangxi keen on Vietnam
Forty-five projects worth a total $370 million were concluded between businesses from China’s Guangxi province and Vietnam at a four-day trade exhibition to end Monday in Hanoi.
Of these 17 projects worth $190 million will be in the financial sector, 12 valued at $134 million will be in trade and the remaining focus on infrastructure construction, transportation, processing and tourism.
The exhibition in its third year running attracted 150 leading Guangxi businesses in China’s key industries, is aimed at promoting trade relation between Guangxi and Vietnam.
Vietnam-Guangxi trade grew by 50 percent last year to $1.5 billion, turning Vietnam into the province’s largest trade partner with many Guangxi investors eyeing business potentials in Vietnam.
Source: TBKTVN, SGGP – Compiled by Dong Ha

Global constructors to descend on Vietnam
More than 200 construction material and equipment producers from 15 countries worldwide are bound for an exhibition, Con-Build Vietnam, in Hanoi from November 20-23.

International companies will seek opportunities to make their products and services more popular on the country’s booming construction market.
Exhibitions will include such famous brands as Draka, Hitachi, Isuzu, Komatsu, Volvo and Liugong, said the organizer, Germany’s Messe Munchen International Asia (MMI-Asia), an international trade fair organizer.

MMI-Asia director Ronald Unterburger said the fair “comes at just the right time.”
“The strong development and increased investment in Hanoi is very similar to Ho Chi Minh City over the last three years. We feel that Hanoi is growing very quickly economically.”

According to the Vietnamese Ministry of Construction, total investment in construction over the first nine months of 2006 was estimated at US$3.13 billon, up 16 percent over the previous year. An annual growth rate in the industry is predicted at between 10-15 percent until 2010.
Source: VNA

Malaysia’s Gamuda gears up for $1bln Vietnam housing project
Malaysian urban developer Gamuda Land expects to make its foray into Vietnam next year by launching its first mixed development housing and commercial project in Hanoi, the Business Times reported Saturday.

The company is finalizing a plan to develop the US$1 billion (RM3.40 billion) township in a joint venture with a Hanoi state-owned enterprise, said managing director Chow Chee Wa.
"We hope to finalize the name of the project soon and launch it by early next year," Chow told a media briefing on new developments at the Bandar Botanic township in southern Klang, Selangor Friday.
Construction of the project is due to start by the end of the year and would take “no longer than eight years” to complete, Starbiz reported.
It will include a convention center, office towers, international five-star hotels, luxury properties and other facilities.
“We are looking to developing the project in Hanoi, tentatively known as Yen So Park, into a commercial urban center,'' Gamuda Land general manager (business development) John Yong told StarBiz late January.
“It is not going to be just a residential township development.''
He said Gamuda Land had established a joint venture with a local partner for the project since Vietnam does not allow foreigners to own land.
He said the team would enter the project “with funds and expertise to redevelop the area.”
Yong said Gamuda had an 80 percent stake in the venture. The 20 percent balance is held by state-owned Mechanical Engineering Services LLC, which owns the land.
Gamuda Land, a property development arm of Gamuda Group, currently has a landbank of a combined gross development value in excess of RM15 billion (US$4.4 billion).
Its existing projects include the newly-launched RM2.6 billion Horizon Hills in Nusajaya, Johor; Bandar Botanic; Valencia; and Kota Kemuning.
Source: Business Times, Starbiz

Stocks hop on after hot week
Vietnamese stocks finished the week on a strong buying binge Friday that prompted a jump on both the Ho Chi Minh City and Hanoi indexes.

HCMC’s VN-Index gained 19.59 points, or 1.92 percent to close at 1039.63. And Hanoi’s HASTC increased 4.41 points, or 1.33 percent to close at 335.48.
There were 62 gainers and 19 losers out of the 107 stocks listed in HCMC.
Investors bid for 9.82 million shares, up 41 percent over Thursday supply fell by 23 percent to 7.2 million shares.
The bourse closed after 4.3 million shares changed hands for VND644 billion (US$29.7 million), up 15 percent and 5.7 percent respectively over Thursday.
Many blue chips were among the gainers – FPT, STB, SJS, VIP and KHA – all of which hit the 5 percent limit.
STB took the market lead in terms of both liquidity and trading value with 981,410 shares traded for VND144 billion.
Eleven big corporations including STB, REE, PPC, PVD and FPT made up 65 percent of the market’s total trading volume.
Of the two mutual funds, PRUBF1 stood still at VND13,900 while VFMVF1 gained nearly 3 percent to close at VND33,900.
Foreign investors remained active players despite their low buying volume. They invested VND123 billion, down 49 percent, in 827,110 shares. They focused their buys on heavyweights like VSH, PPC, PVD and VIP.
Up the north, the Hanoi market saw trading volume and turnover up by 40 percent and 50 percent respectively to 1.3 million shares and VND183 billion.
Lender hits the market
The Vietnam Export-Import Commercial Bank, or Eximbank, has acquired the nod from the central bank to scale up its chartered capital to VND2.8 trillion from the current VND1.2 trillion via share issues.
As planned, the bank will issue more than 1.58 million shares with a face value of VND1 million each.
Late this month, it will use last year’s profit and surplus equities to issue over 657,700 shares to existing shareholders who were registered before December 31. They will be allowed to buy 54 shares for every 100 already held.
In July, Eximbank will also sell 368,000 shares at the face value to existing shareholders registered by June 22 this year, allowing them to obtain one new share for every five shares held.
The bank will issue more than 495,800 shares to local strategic partners at negotiated prices on the condition that these partners must hold 20 percent of their stakes for at least one year and the remainder for at least three years.
It will also issue 56,000 shares at the face value to its staff.
The lender obtained VND215 billion in pre-tax profits in the year’s first four months, a whopping 112 percent jump over the same period last year. Its total assets were VND19.3 trillion, up 62 percent year-on-year.
Reported by T.Xuan – Compiled by Dong Ha

Vietnam businesses to knock on Korea’s door
A delegation of 100 leading Vietnamese enterprises led by Deputy Prime Minister Nguyen Sinh Hung is set to visit South Korea May 21-24 to seek business and cooperation.

The multi-purpose field trip is organized by the Vietnam Chamber of Commerce and Industry (VCCI) and will introduce the investment potential of Vietnamese firms and the country’s investment climate to boost bilateral trade.

The delegation will include Vietnamese enterprises in key industries from oil and gas, coal and minerals, telecoms, tourism, shipbuilding and industrial park development.
Deputy Prime Minister Nguyen Sinh Hung will meet with Korean government office leaders.
The visit will include seminars focusing on the three areas with the most potential for Vietnamese-Korean collaboration: industry-infrastructure-telecoms; agro-forestry-fisheries, trade and handicraft; and banking-finance.
As planned, the Vietnamese delegation will introduce investment opportunities programs to improve trade relations in line with Vietnam’s full WTO membership.
Vietnamese executives will also take the opportunity to explore the Korean market and seek trade partners.
According to South Korean authorities, between 300 and 400 Korean enterprises are registered to attend the forums.
Pham Gia Tuc, general secretary of VCCI, unveiled that several big-value contracts would be clinched by Vietnamese and Korean firms.
Vietnamese delegates will visit the international trade association, businesses in Seoul and the Banweol/Sihwa national industrial complex to share experiences in investment attraction and seek possible partnerships.
A recent survey by the Korean Trade Investment Promotion Agency (KOTRA) on 217 Korean companies in Vietnam said up to 93 percent of the companies are satisfied with their business results.
Some 70 percent said that they will encourage other Korean companies to invest in this newly emerging market.

According to the survey, Korean businessmen are most attracted to Vietnams’ low labor costs, high labor productivity, tax reductions, and the support of the Vietnamese government.
South Korea is the third largest investor in Vietnam with 1,263 projects worth around US$7.8 billion as of late last year.
Last year alone Korean investments in Vietnam hit $2.4 billion, tripling that of 2005’s $770 million.
Source: VietnamNet – Compiled by Dong Ha

Vietnam: WTO benefits emerge but potential not fulfilled

Since its admission to the World Trade Organization in January, Vietnam has seen foreign investment increase and commodity prices drop, but imports still heavily out-value exports.

Regarding the country’s economic growth in the past four months, former deputy Prime Minister Vu Khoan said, “It’s too early to fully evaluate the impacts of Vietnam’s commitments to the World Trade Organization (WTO), but we can say that the country has gained some forward momentum, though not in all arenas.”

Many experts said the most easily recognizable and active indicator of WTO-era Vietnam was the sharp increase of foreign direct investment (FDI).

The country attracted nearly US$3.52 billion in FDI over the first four months, up 54.6 percent year-on-year. In addition, a series of mega projects worth more than $35 billion are awaiting licenses.

Since early this month, many foreign business missions have arrived in Vietnam seeking business and investment opportunities, including a delegation of 18 leading US companies that plan to invest a total of $1 billion here.

Ex-deputy PM Khoan attributed this promising result to the country’s admission to the WTO, which has helped Vietnam improve its legal system and win the confidence of foreign investors.

Deputy Trade Minister Luong Van Tu said Vietnam was currently considered as a “rising star” in Asia. “If Vietnam can take full advantage of the opportunities brought from WTO, the FDI flow to the country this year may be higher than the targeted $12 billion.”

Furthermore, he added that WTO admission could help the country realize its aim of gaining $100 billion in export revenue by 2010.


Lower prices

The price of many imported commodities have decreased slightly recently. At Co.opMart, the largest supermarket chain in Vietnam, the prices of some foreign imported items like candies, cookies, cosmetics, household products, clothes and children’s products are currently down by 10 to 15 percent from late March.

In many other supermarkets, the prices of many imported commodities have also dropped by 10 to 20 percent.

Nguyen Thi Tranh, Saigon Co.op deputy director, said imported goods currently account for some 30 percent of the 20,000 items on sale at Co.opMart. Nearly half of these are sold with prices 10-15 percent lower than pre-WTO, but they are still not as low as they need to be in line with WTO commitments.

Tranh explained that high transportation costs were keeping the prices too high.

Other retailers have explained that it is not just the cut in tariffs associated with the WTO that has dropped prices. They said that better business strategies like finding better supplies, new storage units and improving payment methods have also helped Vietnamese retailers reduce their prices.


Trade deficit

Though Vietnam exports in the first four months of the year increased 22 percent year-on-year, the results did not meet the potential of WTO-era Vietnam, said the Ministry of Trade at a meeting in Hanoi May 7 to review Vietnam’s import-export activities.

The country’s spending on imported goods in the first quarter was up 33.6 percent year-on-year to nearly $11.8 billion, resulting in a Q1 trade deficit of $1.32 billion, 28 percent of the country’s total figure in 2006.

An economic expert told the meeting that only a short time after becoming a WTO member, Vietnam saw a 50 percent year-on-year rise in import spending but only an 18 percent increase in exports.

The Trade Ministry explained that the lack of equipment and machinery was blame to the trade deficit in the first quarter. For instance, the country imported $899 million worth of equipment, including three A321 aircraft worth $306 million, accounting for 30 percent of the total Q1 spending of $2.97 billion.

In the year’s first two months, the country spent $200 million than during the same period last year, mainly due to industrial material price hikes.

The ministry stressed this year’s trade deficit would be regulated in the scope of some $5.2 billion, down 1.58 percent from last year’s.

Source: thanhniennews.com

VietNamNet Bridge - State Bank difficulties in managing foreign exchange rates over the past seven months could remain the biggest challenge to the economy in 2007, according to a United Nations economic survey.
The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) has forecast that major currencies in the region will appreciate as a result of capital inflows. UNDP’s senior country economist Jonathan Pincus said Vietnam’s success in attracting foreign direct investment, portfolio investment, remittances and official development assistance would cause the Vietnamese dong to appreciate against the US dollar if the State Bank did not introduce appropriate checking measures.
So far this year, the dong has gained 0.3 per cent against the US dollar, currently sitting at VND16,047 per dollar despite an earlier State Bank plan to slightly depreciate the local currency by 1 per cent to maintain trading competitiveness.
Since September 2006, local banks have experienced US dollar surpluses for the first time with massive dollar inflows into the booming stock exchange and sharp increases in FDI attraction. This situation has put pressure on the State Bank, as the ultimate purchaser of local banks’ dollar surpluses, to revalue local currency.
“Exchange rate management has become more challenging with the massive growth of local bourses, because a minor change in the rate could have a wide-range of effects,” said Phi Dang Minh, head of the State Bank’s Foreign Exchange Department.
UNESCAP’s statistics show by 2006, with more than 200 listed joint stock companies, Vietnam’s market capitalisation stood at just $14 billion, or 22.4 per cent of GDP. But, according to the World Bank’s latest report, market capitalisation to date has reached $24.4 billion - 39.2 per cent of GDP. According to estimates, from November 2006 to March 2007, foreign investors have injected about $4 billion into local bourses.
Additionally, over the first four months of 2007, Vietnam has lured $3.51 billion via foreign direct investment, recording 54.7 per cent growth against 2006.
According to an official from Vietcombank’s Foreign Exchange department, local banks are still in dollar surpluses, resulting in banks’ lower dollar trading price than State Bank’s official rate.
In early 2007, local banks were allowed by the State Bank to trade up to 0.5 per cent either side of the daily published official rate from a previous percentage of 0.25.
“A wider trading band for domestic transactions is a good thing to the extent that it allows minor adjustments to take place in the official market rather than in the informal market.
“But, careful supervision of banks and development of more sophisticated instruments to control the money supply are needed to ensure that financial liberalisation does not weaken the capacity of the State Bank to manage the exchange rate while keeping inflation in check,” said Pincus.

VietNamNet - Exchange rates may trip economy in 2007

YES, YESSS...Pressure these banks to reval!!!

Originally Posted by blackwulf

VietNamNet - Exchange rates may trip economy in 2007

YES, YESSS...Pressure these banks to reval!!!

This is awesome, you hit the nail on the head with this one

This was last expressed to me by an Aussie over a larger pint of Chang beer last Nov. in Thailand:

Given the choice, the Dinar is a dream come true but for those black moby-dick and obesely clad Iraqi women shrieking like hyenas...YARKS!!!

While I'll have a hundred of those deep and mystical looks by those dashing eyes an Iranian has...'cept for that darn Ahmajinedad they have as father.... it just puked us all!!

Well, what is left is certainly...peace, serenity and lots of exotic prosperity here to expect...with the Vietnamese, Thai and all the rice fields put together, this is the future to live in... no need to buy a Magnum... just be one is what it takes with all these lovely passionate and soothing ladies of the Far East, Vietnam it will be for me!!!

He bought a Condo too in Hanoi and renting out for big bucks to an Expatriat!!!

Safer to move about in a country that is politically safe and turning stable to working hard to become a hub for economic revival ...it can only head towards the path of prosperity and with little or no more bloodshed...who needs it???