Vinh Long targets major investments

HCM CITY — For the past two years, Vinh Long provincial authorities have focused on large-scale investment projects as a driving force for the area’s socio-economic growth, said a local investment official.

Pham Thanh Khon, deputy director of Vinh Long’s Department of Planning and Investment, said the province has succeeded in luring both domestic and foreign investment for higher growth.

In 2007, provincial authorities netted 20 domestic and foreign investment projects with a total registered capital of VND3 trillion (US$181.5 million).

Among them, major projects include the Sai Gon-Vinh Long Brewery, with an investment capital of VND1.2 trillion ($73 million), a Binh Minh satellite urban area project with a registered capital of VND800 billion ($49 million) and the My Thuan High-Tech Services Company worth VND350 billion ($21 million).

In the first eight months of the year, local authorities licensed nine investment projects including a high tech general hospital valued at VND500 billion ($30 million) and a marine product processing and aquaculture plant worth VND1.66 trillion ($100.4 million).

So far this year, 2,000 domestic businesses worth VND4.2 trillion ($254 million) and 14 foreign investment projects worth $66.7 million set up shop in Vinh Long, up 43 per cent over the whole of 2007.

The province’s effort to attract investment in building infrastructure for industrial clusters has paid off. Despite banks limiting credits, the province has attracted four investment projects to build infrastructure for the industrial areas to meet its 2008 investment goal.

In the next two years, the province plans to invite infrastructure investment in 13 industrial clusters covering 546ha.

In other efforts to attract investment in the coming years, authorities have teamed up with various agencies to introduce local economic potential to investors and offer incentive policies involving land, tax and licensing procedures. —

VN-Index down on net sales

HA NOI — Local stock market yesterday witnessed a fall amid lack of investors’ confidence driven by the US financial crisis, and unchanged interest rates along with a wait-and-see attitude for quarterly business results.

The VN-Index closed down 2.32 per cent at 455.05, with 117 codes sliding, 33 advancing and 14 unchanged.

Many big stocks fell sharply; for instance, VNM of Vinamilk, IMP of Imexpharm Pharmaceuticals and DHG of Hau Giang Pharmaceuticals.

However, several lucky big stocks avoided the downturn, such as Song Da Urban-IZ Investment & Development (SJS), PetroVietnam Drillings (PVD) and Pha Lai Thermal Power (PPC) were amongst the winners, but their gains were not big enough to push up the index.

Securities analyst Dao Van Khanh of Agribank Securities blamed yesterdays fall on the high number of shares from existing and newly listed firms which have been pipelined into the market recently.

“Since the stock market has been running smoothly, listed firms began restarting their capital expansion through issuing share. Additionally, some newly listed firms have appeared on the bourse with significant shares volume. This means there is more supply than demand,” said Khanh.

“In addition, concerns of destabilisation in US financial markets has worried investors worldwide, and Vietnamese investors also became more cautious. That’s why they aren’t buying as many shares,” he added.

Although the US government $700-billion bailout has been widely publicised, investors are still worried about the feasibility of the plan.

Sacombank (STB), Saigon Securities Inc (SSI) and Hoa Phat Group (HPG) were the most active shares yesterday. STB saw 1.87 million shares change hands, SSI saw 760,740 and HPG 578,190 shares.

Trading volume today was much less than Tuesday, with 14.39 million shares worth VND487.25 billion (US$29.53 million) changing hands, representing a 50 per cent reduction from Tuesday’s record high of VND1.41 trillion.

“Cautious trading, alongside concern about quarterly business results, which are due out soon, have pulled down share volume and value,” said Khanh.

In Ha Noi the HASTC-Index closed down 0.75 per cent at 151.47. The northern market saw 8.15 million shares traded with a turnover of VND267.02 billion ($16.18 million). —

HOSE, Nasdaq to boost local bourse

HA NOI — Nasdaq OMX Group Inc will assist the HCM City Stock Exchange (HOSE) to develop the Vietnamese stock market, according to a memorandum of understanding signed between the two parties on Tuesday in New York.

The memorandum aims to leverage Nasdaq OMX’s technology and market experience to strengthen infrastructure, efficiency and liquidity at HOSE and in the Vietnamese capital market, as well as attract investors to the local exchange.

“The agreement with Nasdaq aims to foster closer ties between the two organisations and to establish a channel for information exchange in areas including system operations, regulatory framework, cross-listing and product development,” said Nguyen Doan Hung, chairman of HOSE.

“It is with great anticipation that we enter this partnership with HOSE, as a means to fulfil the potential of the Vietnamese stock market,” president of Nasdaq OMX Magnus Bocker said, adding that HOSE has experienced strong growth over the last few years.

HOSE was established in 2000 and operates the biggest securities market in Viet Nam. An agency of the State Securities Commission, it is owned by the Viet Nam’s Ministry of Finance. Since August last year, HOSE has operated as a limited company to better meet local market needs.

Nasdaq OMX is an exchange company offering capital raising solutions, with over 3,900 companies representing US$5.5 trillion in total market value. —

SAM finalises deal with two local firms

HCM CITY — The Cayman Islands-registered Saigon Asset Management Corporation (SAM) expects to maximise its potential following the finalising of its agreement with two local partners, Hanoi Fund Management and Thang Long Securities Company.

Hanoi Fund Management (HFM) will assist in the portfolio management of SAM’s Vietnam Equity Holding.

“This partnership will maximise the two sides’ potential and bring new value to SAM’s investors,” said Louis Nguyen, SAM’s chairman and CEO.

SAM’s international experience and fundraising ability as well as SAM’s parent company, the joint-stock Military Bank, will help further the co-operative arrangement.

Thang Long Securities Co will provide financial investment services to SAM’s investors and partners.

The securities firm offers services, including brokerage, consultancy on mergers and acquisitions and corporate finance, as well as equity private placement.

“Foreign investors have a real demand in accessing Viet Nam’s stock market, and through our relationship, our shareholders and partners will be able to get trustworthy information and opportunities,” Louis said.

SAM, previously known as Anpha Capital Group, is managing two funds, Vietnam Equity Holding (VEH) and Vietnam Property Holding (VPH), which have a combined capital of US$125 million. They are listed on Germany’s Frankfurt and XETRA exchanges.

HFM, with the Military Bank and Thang Long Securities as major holders, manages, apart from VEH, two other funds, Ha Noi Fund and Vietnam Tiger, and offers portfolio management to local and foreign investors.

By August, around $130 million was under HFM’s management.

Thang Long Securities, also an affiliate of the Military Bank, is one of the five top securities brokers in Viet Nam. —

MARD develops tra catfish plan

MARD develops tra catfish plan

An overabundance of tra catfish has made farmers in the Cuu Long (Mekong) Delta lose hundreds of billions of dong, resulting in 20 per cent of total farmers abandoning tra fish farming. To compound this problem, it has been very difficult to obtain capital for rearing a new crop.
As a result of the crisis, tra catfish processing and exporting enterprises are now faced with a shortage of material for processing. Viet Nam News reporter To Nhu spoke with Luong Le Phuong, Deputy Minister of Agriculture and Rural Development, about the impact of the crisis and long-term solutions for the tra farming industry.

What do you think about the current shortage of tra catfish for processing?

In fact, the situation is not severe. The enterprises have mainly lacked white-meat tra catfish and 0.9kg – 1.1kg tra catfish. This shortage is attributed to the end of the farming season and to some households not starting a new tra catfish crop.

So, tra material is forecast to be lacking in the last two months of this year, especially as seafood enterprises process seafood to export to foreign countries for the tourism season at the end of the year.

We must accept the situation and find measures to solve the difficulty. Enterprises must balance supply and demand by themselves. They should find catfish by themselves to process into value-added goods.

Each enterprise should claim its own supply region or work directly with farmers to rear tra catfish.

Initially, the Ministry of Agriculture and Rural Development (MARD) tried to work with provinces to raise export prices, and then tried to increase the purchasing price of tra material so farmers had a bigger profit.

Does this situation create a chance to encourage more tra farming in the region?

The ministry has a plan to stably develop the fish raising industry, which includes all points necessary to create favourable conditions. These aspects include workforce development, fish processing, fish feed, establishment of financial mechanisms for the industry and anti-dumping policies.

The ministry has authorised provinces to set up plans for developing the tra catfish regions based on local natural conditions and environment. Guidance for the plan will be provided by the ministry, while the Department of Agriculture and Rural Development is responsible for implementation.

Tra farmers should combine their capital to solve the lack of capital. One ha of fish pond area needs capital worth billions of Vietnamese dong, and therefore needs investment from many small business households.

The overabundance of tra has been partly attributed to households not implementing the State’s plan on developing the tra catfish regions.

Is the relationship between enterprises and fish farmers in the past a problem that must be solved for the long-term?

The relationship between enterprises and fish farmers is considered a great and close relationship. However, all solutions must improve all relations, including the relationship between enterprises and fish farmers, between exporters and importers and among enterprises.

The ministry will require the people’s committees of provinces in the Cuu Long Delta to check plans on rearing tra catfish, hold training courses on raising high quality fish, and encourage and supervise the selling of tra catfish by developing contracts between enterprises and farmers.

Besides that, enterprises should set up groups of 3-5 members that could combine to increase export prices for tra catfish to help with rising purchasing prices, promote consumption for tra commercial products and avoid market dumping.

What role have banks had in relation to enterprises and fish farmers recently?

Recently, banks have had timely support for enterprises and fish farmers for each concrete stage. However, for the long-term, banks should be more active in giving support and directly join the production and export of tra catfish as investors instead of creditors.

I think, each bank should have a division for researching investment and the market. The division will co-operate with relevant offices to appraise projects and give fair investment chances to enterprises and fish farmers without requiring collateral assets. Many fish farmers have business potential, but they have small collateral assets and can get few loans from banks based on their collateral assets. —

VN eyes agricultural trade with Russia

MOSCOW — Viet Nam will hold an annual trade promotion seminar in Russia for the countries’ agricultural enterprises to exchange information about their businesses, said Deputy Minister of Agriculture and Rural Development Luong Le Phuong at a seminar in Moscow.

In addition, Viet Nam will organise market research tours for Russian agricultural importers in Viet Nam, Phuong said at a seminar on the promotion of Vietnamese farm, forestry and seafood products at the Tuesday kick-off of the 17th Worldfood Exhibition in Moscow, running through September 26.

Phuong said that such efforts would increase trade between Viet Nam and Russia, which is expected to reach US$2-3 billion a year from $1 billion in 2007, with seafood, rice and tea remaining Viet Nam’s key exports.

To date, only 36 of Viet Nam’s total 200 seafood processors and exporters have sold their products to Russia – a market with over 142 million people, he said.

Phuong attributed Viet Nam’s modest export earnings from Russia to a lack of communication about the demands and capacities of the two countries’ businesses.

“There was a time when Vietnamese businesses concentrated only on the US and EU markets and forgot the big potential of Russia,” Phuong admitted.

Viet Nam earned $239 million from agricultural exports to Russia in 2007, of which $118.7 million was from seafood alone, he said.

Showcasing seafood

Nine members of the Viet Nam Association of Seafood Exporters and Processors (VASEP) are showcasing their products at the Worldfood Exhibition in Moscow.

This is VASEP’s largest-ever presence at an international food exhibition, said VASEP representative Ho Thi Thu Trang, adding that Moscow is one of two international food exhibitions that VASEP attends every year – the other taking place in Dubai.

Though the cost of attending the Moscow exhibition is four times that of Dubai, Vietnamese exporters are willing to pay a higher price to reap the benefits offered by the Russian market.

“This is because Russia is the biggest consumer of Vietnamese catfish, accounting for 15 per cent of the gross export turnover,” said Trang.

This year’s event covers over 60,000 sq.m of space and draws 1,300 companies from 61 countries, including long-time members Argentina, Belgium, the US, Italy and Germany.

Viet Nam’s representatives made their debut at the event in 2005. —

IT staff shortage looms as demand skyrockets

HCM CITY — An additional 100,000 information technology workers will be needed in HCM City by 2010, according to participants at an IT seminar held in HCM City yesterday.

More than 6,000 local and foreign IT companies are operating in HCM City, 50 per cent growth compared to last year.

The IT industry this year contributed 1.5 percent of the city’s GDP and by 2015 the amount is expected to be 3 per cent, according to city’s Department of Information and Communications.

The application of IT in tourism, entertainment, banks and securities companies has become widespread.

Pham Ngoc Tuan, general director of the Sai Gon Postel Corporation, said Viet Nam’s membership in the World Trade Organisation had opened up trade and created more opportunities in the industry.

Many of the world’s leading IT companies have set up operation in the country and introduced the latest IT technologies.

A staff shortage in the industry, however, looms.

Ha Van Liem, deputy general director of Global Cybersoft, a software producer, predicted it would need 1,000 more engineers through 2010.

HCM City has around 25,000 IT engineers in the software and hardware industry.

In 2004, there were 18 universities offering IT training, but that has risen to 24 schools, training 10,000 new graduates every year.

Companies, however, complain about the quality of the IT graduates.

According to a survey conducted by HCM City-based Quang Trung Software City, more than 46 per cent of IT engineers lack professional knowledge and most job candidates have to receive additional training from the companies that hire them.

The lack of foreign language skills is also a serious problem among IT engineers, as more and more foreign IT firms open offices in Viet Nam.

Forty per cent of IT graduates cannot speak English, and many IT programmes do not include English classes.

Lack of creativity and practical, rather than theoretical, knowledge are two other concerns. —

Gov’t gives nod to Vinashin loans

Workers of Pha Rung shipbuilding company, a member of Vinashin, construct a 34,000 tonne vessel to export to England. Vinashin has been granted permission to issue corporate bonds worth US$182 million to expand its core business. — VNA/VNS Photo Thuy Quynh

HA NOI — Deputy Prime Minister Nguyen Sinh Hung on Wednesday allowed the Viet Nam Ship-building Industry Group (Vinashin) to access financial resources totalling more than US$1.18 billion to realise its key projects.

Of the funds, Vinashin will be permitted to issue corporate bonds worth VND3 trillion ($182 million) and get commercial loans from local banks for VND10 trillion ($606 million), according to the Government website.

In addition, it will be permitted by the Government to access foreign commercial loans valued at $400 million.

The financial resources will be used to implement ship-making contracts for overseas partners, deals with the Viet Nam National Oil and Gas Group; projects for the Dung Quat ship-making factory in the central province of Quang Ngai; and other infrastructure construction works.

According to the website, Hung asked the Vinashin management board to scrutinise all important projects, build up specific routes for each project to find out appropriate commercial loans and then work with each bank for financing.

According to the deputy prime minister’s requirement, the Viet Nam Development Bank (VDB) and commercial banks will take responsibility for carrying out commitments with Vinashin, specially warranting essential financial resources for its contracts.

Particularly, the Bank for Investment and Development of Viet Nam will bankroll some VND2.7 trillion, the Viet Nam Bank for Industry and Trade funds VND2 trillion, around VND3 trillion from VDB, VND2 trillion from the Bank for Agriculture and Rural Development and other financial institutions will handle the remaining VND300 billion.

Over the past decade of operation, Vinashin raised its ownership capital from VND100 billion to approximately VND6 trillion.

It is slated that next month the Ministry of Finance (MoF) will co-ordinate with Vinashin to appraise and make the official announcement of its charter capital basing on audited financial reports.

Hung also requested that the MoF co-operate with the Steering Committee for Enterprise Renovation and Development, and other relevant State bodies to valuate its assets; classify its ownership capital and State-owned capital, suggest solutions for adjusting and supplementing charter capital and then report to the Government for approval.

Additionally, he asked the MoF to issue guiding documents to evaluate its trademark as a visible asset for contribution to joint ventures.

Vinashin plans to notch up a revenue of VND24.9 trillion in the second half of this year, from ship-making, construction, transportation, trade and services. —

Local investors lift index with blue chips

HA NOI — Blue chips have pulled local investors back in after they stayed away due to trouble in the US financial market, contributing to a rebound in the stock market yesterday.

The VN-Index bounced back 3.38 per cent to 470.43 yesterday, with 18.08 million shares and fund certificates changing hands, generating a turnover of VND715.45 billion (US$43.10 million).

Nearly 78 per cent of a total 164 shares and fund certificates listed on the bourse gained points, the same stocks that fell on Wednesday, such as FPT of Financing and Promoting Technology, SSI of Saigon Securities Inc and STB of Sacombank.

“The rally of many blue chips, thanks to higher buying orders, helped push up the VN-Index,” said Ocean Securities’ broker Nguyen Dinh Long.

The return was not overly remarkable as market liquidity was moderate, Long said.

“At present, the domestic economic situation is going better, proven by the slow increase of economic indices such as CPI and the monthly trade deficit. But no big news has appeared to spur investors into heavier trading.”

As a result, market liquidity will remain moderate, he concluded.

Meanwhile, the head of the Market Development Department under the State Securities Commission Nguyen Son has affirmed that US financial turmoil has not significantly impacted the Vietnamese stock market.

“Local investors have been driven to be cautious with securities trading because of their attitude towards the US financial recession, as they are afraid the US recession will negatively impact the local financial system,” Son said. “However, they are just afraid without any evidence.”

Son added that there was no evidence that the local stock market would follow the activities of foreign investment funds which operated in Viet Nam, as these funds have still bought back shares accompanying their sales.

“We realised that foreign sector trading absolutely aimed at adjustments in investment portfolios,” he said.

Foreigners yesterday were busy with trading, buying 5.09 million shares and selling 3.01 million. They focused their purchases on HPG of Hoa Phat Group, PPC of Pha Lai Thermal Power, and PVD.

HPG was the most active share, with its trading volume doubling Wednesday’s data at 1.34 million shares. This group is one of the listed firms in HCM City Stock Exchange that submitted yearly business results ahead of its deadline.

Alongside HPG are STB with 1.89 million and DPM of Phu My Fertilisers with 910,350 shares sold.

In Ha Noi Securities Trading Centre, the HASTC-Index bounced back 3.68 per cent to 157.04, thanks to the rebound of big stocks such as ACB of Asia Commercial Bank, PVS of PetroVietnam Securities, and VCG of constructor Vinaconex Group.

The northern centre witnessed a slight increase in trading volume to 10.69 million shares, in comparison with Wednesday’s figure. This amount generated a turnover of VND369.73 billion ($22.27 million). —

Gov’t okays Vietinbank’s equitisation plan

HCM CITY — The State-owned Viet Nam Bank for Industry and Trade (Vietinbank) is prohibited from spending over 20 per cent of its charter capital on its initial public offerings (IPO), according to the Government’s approval of the bank equitisation plan released on Tuesday.

Of the total, VietinBank was allowed to sell less than 5 per cent of its charter capital to public and local strategic partners, while foreign strategic partners are permitted to hold no more than 10 per cent.

The bank will also maintain the State’s stake of no less than 51 per cent of its charter capital, which is controlled by the State Capital Investment Corporation (SCIC).

Additionally, the bank is prohibited from choosing more than two foreign institutions as strategic partners.

“At present, we cannot say anything about the selection of strategic partners, or about other details relating to our IPO,” said VietinBank’s Chairman Pham Huy Hung.

However, the bank was in talks with over 10 overseas commercial banks for the selection, Hung said.

“Also, we are trying to complete the final procedures of equitisation, including the initial price offered to both local investors and foreign strategic partners, to have the Government’s permission in this fourth quarter,” he added.

VietinBank now has a charter capital of VND13.4 trillion (US$807.23 million). The bank has chosen JP Morgan as its equitisation consultant. —