Thread: Latest news on the Dong!

SBV’s decision may draw VND50tril from market17:05 06/06/2007VietNamNet Bridge –

It is estimated that around VND50tril ($3.12bil) could be taken from circulation with the new decision by the State Bank of Vietnam on raising the compulsory VND reserve rate.



Under the new decision, the compulsory reserve rate applied for under-12-month term deposits has been raised from 5% to 10%. The rate for Agribank is now 8% instead of 4% as previously applied.

The new decision has not been welcomed by commercial banks. The Director General of a joint stock bank said that he was not pleased with the decision as it would make operation expenses higher, though he acknowledged that the usable capital of banks was relatively high now and the decision would not badly affect the banks in the short term.

However, experts have warned that with such a high compulsory reserve rate, banks will be short of usable capital in several months.

An expert from a foreign bank branch has warned that the impact of the decision on raising the compulsory reserve rate will be clearly seen in three months. He said that the market would see capital shortage and banks might consider raising interest rates.

One month ago, members of the Vietnam Banking Association reached an agreement on lowering the interest rates on bank deposits. However, with the new decision from SBV, the agreement may be voided and the interest rates may be raised again.

SBV is now trying to make a move to curb inflation and control credit quality. Most recently, it decided that outstanding loans funding securities trading deals must not exceed 3% of banks’ total outstanding loans.

(Source: DTCK)
- Ban de in

Activity involving the Dong is allways a good thing. I will sit and wait

Dollar price hits highest peak in six months

VNECONOMY updated: 06/06/2007

The Vietnam Bank for Foreign Trade (Vietcombank) on June 4 announced the exchange rate at VND16,096/US$1, the highest peak in the last six months. Experts said that the rate would see further adjustment as the demand is increasing.
Earlier last week, the rates announced by Vietcombank were VND16,065/US$1 (purchasing) and VND16,075/US$1 (selling). One day later, the figures rose to VND16,055 and VND16,080 respectively. On June 4, the greenback was sold at VND16,096/IUS$1, the highest peak over the last six months.
Experts said that the greenback has been revaluating, though very slowly. On the black market, one dollar is now exchanged for VND16,020.
The situation proves to be quite different from what was seen late last year. After reaching the VND16,100/US$1 level on November 17, the greenback devaluated gradually, bottoming at VND16,000/US$1 on February 9, 2007. However, the greenback price has bounced back again on March 2, when the exchange rate reached VND16,001/US$1 and the greenback value has been continuously increasing since then. In the last week alone, a dollar increased by VND20 in value.
Hoang Danh Chinh, the owner of the Kim Dung Gold Shop on Le Loi street in district 1, HCM City, said that though the dollar price increases, the demand for dollar does not increase accordingly. He said that every day, his shop exchanges several thousand dollars for clients. Eximbank has also reported the same situation: some $400-500 are exchanged every day.
Meanwhile, Nguyen Phuoc Thanh, Director of Vietcombank HCM City Branch has attributed the dollar price increase to the sharp increase in the demand. As the gold price in the domestic market keeps rising, gold importers try to collect more dollars to import gold. He said that the demand for dollars reaches $10mil some day.
“The supply of dollars has become more tight when the State Bank of Vietnam decides to buy dollars in for the national reserve fund, which has made the demand for dollars increase dramatically,” said Mr Thanh.
Vu Duc Hai from Eximbank said that the continued increase of the dollar value is the periodic recovery of the currency. Importers need more dollars at this moment, while foreign funds tend to sell shares to get dollars back. These factors all have led to the scarcity of the greenbacks.
Experts said that it is very likely to see the greenback value increase further as Vietnam needs to encourage exports, especially when it has joined WTO.
Mr Thanh from Vietcombank has forecast that the dollar supply and demand will balance in the coming time. The investors, who find it unprofitable to keep dollars, will sell dollars. The greenback will revaluate, but there would not be big changes and dramatic increases as the exchange rate is being put under the control of the central bank.
Báo Ä�iện tá»* - Thá»�i báo Kinh tế Việt Nam

Source: VnExpress

Nation to issue US$1 billion in bonds

VNECONOMY updated: 06/06/2007

Viet Nam will issue US$1 billion in government bonds to the international market in 2007 in order to fund needed infrastructure projects.
According to a recent resolution signed by Prime Minister Nguyen Tan Dung, the bonds are to be issued in US dollars as global bonds.
The raised capital from the issuance will be used to fund the Dung Quat oil refinery project, ship purchases for the Viet Nam Shipping Lines (Vinalines) and the construction of a hydro-power plant in Laos and another in central Nghe An province.
Báo Ä�iện tá»* - Thá»�i báo Kinh tế Việt Nam

Source: Vietnam Agency

Last updated: 15:53 - June 6, 2007
Vietnam aims for image as luxury destination: US paperThe US "Wall Street Journal" has carried an article entitled "Vietnam aims for image as a luxury destination," highlighting the Southeast Asian country's tourism potential.
The paper said investors from the US, Canada, Singapore and Dubai are among those developing posh gateways in Vietnam, citing new resorts in the central coast.
The paper quoted international tourism officials as saying that with its powdery beaches, mountains, rare wildlife, French-inspired cuisine and world-class cultural sites, Vietnam could be the next top-drawer destination in Asia, on a par with Phuket in Thailand or the Indonesian resort island of Bali.
"It's so diverse. In one destination, you can do so much," said John Koldowski of the Pacific Asia Travel Association, a regional travel - industry trade group.
A number of the world's hoteliers also agreed with that fact, said the paper, recommending the five-star Furama Resort in Danang, where guests have included European royalty and Asian heads of state.
"I think it matches any resort, any place in the world," Furama guest Fred Williams, a globe-trotting security consultant from Davie, Fla, was quoted as saying.
The paper also introduced a number of renowned resorts in the central coast of Vietnam, saying they are catering to a swelling tide of foreigners, numbering 3.6 million last year.
The Pacific Asia Travel Association forecast a robust 7.6% average annual growth rate in foreign arrivals through 2009, it wrote.
The paper continued to say that while Vietnam remains popular with backpackers, it is now attracting a more affluent class of travellers. "People are coming to Vietnam to do business and returning to take vacations. In addition to the natural and cultural attractions, Vietnam has a deserved reputation for safety and political stability." (VNA)
Nhan Dan ---Business


After the Dong R/V's, I would make visiting 'Nam one of my top priorities.

Kind of my way of thanking them!

Originally Posted by Ralphrod67

Activity involving the Dong is allways a good thing. I will sit and wait

Originally Posted by Din Diesel

After the Dong R/V's, I would make visiting 'Nam one of my top priorities.

Kind of my way of thanking them!

You, me , Ralph and a few others can make that trip. Hold it down Din, we are almost there.

Originally Posted by notazbad2000

You, me , Ralph and a few others can make that trip. Hold it down Din, we are almost there.

You can count me in! I will come too!!!!pick me!!!pick me!!!!

Originally Posted by screwball

You can count me in! I will come too!!!!pick me!!!pick me!!!!

We got you cover screwball!

Last Updated: Wednesday, June 6, 2007 13:52:32 Vietnam (GMT+07)

World’s top aluminum maker eyes $1 bln project in Vietnam

Russian-owned Rusal, the world’s biggest aluminum and alumina producer, is considering a US$1 billion project to mine and process bauxite in Vietnam, a Vietnamese daily reported Tuesday.

The project would help strengthen Russia’s economic ties with Vietnam, of which investment remains weak point, said Igor Khovaev, Minister-Counselor of the Russian Embassy, as quoted by the Quan Doi Nhan Dan (People's Army).

Rusal opened an office in Vietnam last month. The country is home to an enormous energy potential and rich bauxite reserves.
Khovaev also said Russia would not stop at investment in Vietnam's bauxite reserves, but also looked to build power plants and develop the aluminum industry in the Central Highlands, which is rich in bauxite ores.
He stressed that investment in Vietnam was at the top of the agenda for his country.
“The Russian embassy is actively working with companies and conglomerates to boost investment in Vietnam,” Khovaev said.
Bilateral trade between Vietnam and Russia stood at $200 million in the first five months of 2007.
Khovaev also voiced the Russian government’s expectation that consultation rounds with Vietnam on Russia’s bid to enter the World Trade Organization would wrap up soon. He said the two friends were consulting, not negotiating, and the countries mutually understood each other.
“Consultations are what leaders from the two countries have agreed upon, instead of negotiations, on Russia’s WTO membership,” said Khovaev. “These consultation rounds play a significant role in solving technical issues in economic and trade relations between the two countries. As a strategic partner, Vietnam would fully understand what Russia is interested in.”

Source: VNA

Last Updated: Wednesday, June 6, 2007 20:55:50 Vietnam (GMT+07)

Sacombank of Vietnam, ANZ sign remittances deal

Saigon Thuong Tin Commercial Bank, Vietnam's sixth largest, said Wednesday it had signed a deal with shareholder Australia and New Zealand Banking Group (ANZ) to make it easier to send money to Vietnam from Australia.

The agreement allows people to send their money through two ANZ outlets in Melbourne at half the ordinary fee, the Ho Chi Minh City-based lender said in a statement.

Beneficiaries can receive the remittance at home or at any of Sacombank's 165 points of service, it said.
ANZ Bank owns a 10 percent stake in Sacombank and is one of three foreign investors in Vietnam's first listed bank.
Together with the World Bank's International Finance Corp. and British fund manager Dragon Capital, the three hold a combined 26.3 percent.
Overseas remittance along with foreign investment are key foreign exchange sources helping Vietnam offset a rising trade deficit.
Source: Reuters