Vietnam retail market to expand over next two years, say experts

Vietnam’s retail market is forecast to explode over the next two or three years, with the appearance on high streets of many foreign retail companies, including shopping centers and large sized supermarkets, said Fabrice Carrasco, general director of TNS WorldPanel Vietnam on October 30.

Shoppers in a supermarket in Vietnam

Speaking at a retail and distribution conference held in Ho Chi Minh City, Mr. Carrasco said Vietnam’s retail market is smaller than that of other countries in Southeast Asia, such as Thailand, Malaysia and Philippine, however, Vietnam’s consumer habits are changing sharply.

According to RNCOS, a global market research company based in the US, retail turnover in Vietnam will top US$85 billion in 2012.

Vietnam’s retail turnover was $23.7 billion in 2008 and is expected to rise to $39 billion by the end of this year.

Bui Ngoc Hong, a law consultant at Indochina Counsel, said foreign firms have been eyeing retail and distribution business in Vietnam.

Indochina Counsel has alone supported seven foreign retail companies, which will appear on Vietnam’s high streets in the next two years, Mr. Hong said.

2009 is considered an important milestone year for trading and distribution sectors in Vietnam. Distribution in Vietnam is set for a shake up, as foreign companies move in following the country’s commitment to open the market in 2009, on the back of World Trade Organization accession in 2007.

As a result, firms from abroad have been setting up shop here since early this year, particularly firms from Japan, though no official statistics are currently available.

Japanese sewing machine manufacturer Brother International recently won a license to set up a distribution company with an initial investment of $2 million.

Stainless steel and construction material producer Sojitz opened an import, export and distribution branch in March.

Car manufacturer Nissan and electronics producer Sharp have both started distributing their own products.

According to the Ministry of Industry and Trade, Vietnam’s annual retail turnover has increased by 20 percent, on average, over the last few years and is forecast to maintain the same growth for the near future.

Source: SGGP Bookmark & Share

VN firms expand overseas presence

VN firms expand overseas presence

by Thien Ly

Overseas investment by Vietnamese companies has risen sharply in the past few years in terms of quality and scale of projects.

According to the Foreign Investment Agency (FIA), they have invested a cumulative US$6.8 billion in 440 projects in 49 countries and territories, mainly in Asia. As of August, $1.5 billion of the investment was actually disbursed.

Just this year investments have topped $2.1 billion.

The projects are mainly in sectors like manufacturing, construction, services, and agriculture.

FIA director Phan Huu Thang said Vietnamese firms’ potential for overseas investment was huge, with the actual investment hardly matching their desire and capability.

The Government recently approved an overseas investment promotion plan, which would provide an important legal basis and impetus for Vietnamese companies to further develop their overseas presence. The Ministry of Planning and Investment has also encouraged enterprises to expand investments to new markets like Latin America and Eastern Europe in areas like energy, exploitation of natural resources and cultivation of cash crops.

Capital gains tax: property

After more than one week of selling out properties, even at a loss, to avoid the new capital gains tax, HCM City investors have almost completely stopped transactions related to lands or apartments.

The real estate market has been in a tizzy after the Government said the real-estate profits would be taxed at 25 per cent with effect as of the end of this month. Many people have panned the new provisions as being unfair even before specific guidelines for their application have been announced.

The developers of the Him Lam-Kenh Te housing project in District 8 say there was not a single customer last week.

The situation is starkly different from the last few months when it carried out 30 or 40 transactions a month.

Other busy areas like the districts of Nha Be, 2, and 9 have also seen business dry up. Nguyen Xuan Loc, head of Vinaland Company’s office in District 2, says few transactions are being done.

Property trading floors have fared no better. Pham Van Hai, director of the ACB Real Estate Company, also admits there are few transactions, with only medium-priced apartments still being bought and sold.

Analysts say that both developers and buyers are confused about the new capital gains tax regime, and are awaiting clearer guidelines. Tax offices themselves are yet to receive guidelines on its implementation from the Ministry of Finance or the General Department of Taxation. —

Source: vietnamnews.vnagency.com.vn

Electronic customs network to expand

HCM CITY — The country’s electronic customs network will be expanded to five provinces and two additional cities this year, an official from the General Department of Customs has said.

The country’s customs procedures must be aligned with international and regional norms, Le Van Ninh, head of the department’s reform division, said during a meeting organised by the department and the Viet Nam Chamber of Commerce and Industry in HCM City yesterday.

E-customs will be available in Ha Noi and Da Nang and the provinces of Dong Nai, Binh Duong, Lang Son, and Ba Ria-Vung Tau.

In 2005, a trial e-customs system began in HCM City and Hai Phong, resulting in time and money savings. As a result, more than 297 companies now use e-customs in HCM City.

The Government began the e-customs effort in the two cities to reduce corruption among customs officials and to minimise time spent on customs procedures for companies.

The new service allows businesses to file online applications and track the progress of customs clearance.

Ninh said many companies had not invested in computers to make use of the services.

Le Quang Hoai, an official with the Customs’ statistics department, said the sector would upgrade IT infrastructure, broadband speed and software to enhance network stability and security.

Training customs staff and businesses in using e-customs would be another priority, he added.

To help businesses, the e-customs network will be linked to the State treasury, banks and tax offices.

During the meeting, the Thai Son Technology Development Company conducted an installation of ECUS e-customs software and instructed companies in how to use it. —

Source: vietnamnews.vnagency.com.vn

Vietnam, India expand scope of strategic partnership

– Indian President Pratibha Patil will make a State-level visit to Vietnam from Nov. 24-28 at the invitation of President Nguyen Minh Triet.

This will be the first visit to Vietnam by Pratibha Patil and the second by an Indian President since the two countries established diplomatic ties in 1972.

The visit is aimed at boosting the traditional friendship and comprehensive cooperation, as well as expanding the strategic partnership relationship in politics, economy, trade, investment, science and technology and culture.

A number of regional and global issues of mutual concern will be discussed during the visit, as well as measures to strengthen the coordination between the two countries at multilateral forums.

Vietnam-India relations have experienced several important steps in their development, particularly since the two countries established strategic partnership relations in July 2007. The two countries’ prime ministers met on the sidelines of the 7 th Asia-Europe Meeting (ASEM7) in Beijing , China , in October 2008.

Economic cooperation over the years has experienced a number of significant developments. In 1982, the two countries established a Joint Commission on Economic, Cultural, Scientific and Technical Cooperation, an important mechanism for the two sides to boost cooperation in numerous fields.

Trade turnover between Vietnam and India has increased markedly; from 72 million USD in 1995 to over 1 billion USD in 2006 and 1.53 billion USD in 2007. During the first seven months of 2008 this figure has reached 1.7 billion USD.

Vietnam exports to India coal, pepper, electronic components, rubber, cinnamon, machinery, steel, fiber, footwear; and imports from the latter animal feed, mobile phones, medicines, plastics, steel and other metals, raw materials for pharmaceutical production and garment and textile industry, pesticides and chemical products to India.

As of October 2008, India has 30 valid investment projects in Vietnam , with total implemented capital of 578 million USD, ranking 27th out of 76 investors in the country.

In addition, cooperation in agriculture, culture, education, science and technology, national defence and security has recently been expanded.

The two countries also cooperated closely at various regional and international forums.

India supported Vietnam in its bid to become a non-permanent member of the UN Security Council for the 2008-09 term.

Vietnam has always supported India in its efforts to increase cooperation with ASEAN members, in its participation in East Asia cooperative matters and in its bid to become a permanent member of the expanded UN security council.-

Malaysia wishes to expand cooperation with Vietnam

Hanoi (VNA) – The Malaysian Government attaches huge importance to the expansion of cooperation with Vietnam , affirmed Malaysian Foreign Minister Rais Yatim.

The Malaysian FM made the statement while meeting with the Vietnamese State President Nguyen Minh Triet in Hanoi on Nov. 12.

He said that Malaysia wants to work together with Vietnam in addressing a number of outstanding problems regarding labour exports in the spirit of cordiality and friendship.

President Triet expressed his pleasure at the comprehensive development of the relations between Vietnam and Malaysia over recent years.

Currently, Malaysia is the second-largest foreign investor in Vietnam and trade turnover between the two countries has constantly and steadily increased. Malaysia has recently become the largest market for Vietnamese labourers working abroad, having employed around 110,000 workers to date.

The President expressed his wish that the two countries would strengthen cooperation in the near future, focusing on labour export, education, culture, science and technology.

Earlier, during his discussions with Deputy Prime Minister and Foreign Minister Pham Gia Khiem, the Malaysian Foreign Minister Rais Yatim pledged to work to further his country’s all-round cooperation with Vietnam , affirming his government treasures its relationship with Vietnam , regarding it as an important counterpart in Southeast Asia .

The two FMs were pleased at rapid developments in the two countries’ cooperation across a wide range of areas and welcomed the fact that Malaysia is currently the second-largest investor in Vietnam , with registered FDI standing at 17.7 billion USD as of October this year.

Malaysia is Vietnam ’s ninth-largest trade partner – its two-way trade value with Vietnam has reached almost 3.5 billion USD over the past nine months.

The two officials reached agreement on a host of measures to lift the two countries’ relations to new heights, including increasing the exchange of visits by high-ranking delegations, conducting the fifth meeting of the two countries’ joint committee in Malaysia, completing an action plan to implement the joint statement on a comprehensive framework for cooperation in the 21 st century, and boosting cooperation in a wide range of matters.

Deputy Prime Minister and Foreign Minister Pham Gia Khiem thanked the Malaysian Government for facilitating its businesses’ employment of Vietnamese workers and requested that it continue to monitor the safety of Vietnamese workers and coordinate in ensuring that standards are upheld.

He spoke highly of the two countries’ coordination at regional and international forums, including ASEAN, ARF, EAS, ASEM, APEC and the UN.

On the same day, Permanent Deputy PM Nguyen Sinh Hung also received FM Rais Yatim, stressing that the two countries need to increase cooperation in the training of workers, including specific training in the laws, customs and cultures of the two countries.

The Malaysian FM said that the Vietnamese who work in his country are highly-valued by the Malaysian Government for their skills.-

Indonesia, China to expand economic cooperation

– Indonesia and China will sign an agreement to expand their bilateral trade and economic cooperation at a meeting of their joint commission in Yogyakarta in November this year, Indonesian Trade Minister Mari Pengestu said.

“We are going to sign an agreement to expand our bilateral trade and economic cooperation at a meeting of the Joint Commission chaired by the two countries’ trade ministers in Yogyakarta,” Pangestu was quoted by Antara news agency as saying after a meeting with her Chinese counterpart Chen Deming in Beijing last weekend.

According to the minister, the two governments would send senior officials to a meeting either in September or October this year to complete the draft of the planned agreement.

The agreement would cover various efforts the two countries would make to step up their trade and economic cooperation through, among other things, information exchange and formation of a body to settle bilateral trade problems without the help of the World Trade Organisation (WTO).-

Vinaphone signs deal to expand GSM network

Washington – Motorola yesterday signed contracts worth 28 million USD with Vietnam Posts and Telecommunications Group (VNPT) for the expansion of Vinaphone’s GSM network across 12 northern provinces in Vietnam .

Motorola Vietnam ’s General Director Ray Owen and Vinaphone’s CEO Hoang Trung Hai signed the contracts in an official ceremony marking another milestone in the collaboration which started more than 12 years ago.

Under the agreements signed during the ongoing visit to the US by Vietnam ’s Prime Minister Nguyen Tan Dung, more than 1,000 cell sites will be deployed in northern Vietnam , according to Motorola.

Motorola said it will deliver its GSM infrastructure and solutions as well as a range of comprehensive services, including network optimisations, operations and maintenance in order to expand the cellular network and mobile services of Vinaphone, a subsidiary of VNPT, in suburban and rural areas of the country.

This is Motorola’s second GSM network expansion project with VNPT in six months. Shipment of the equipment will begin later this year and the project is expected to be completed in 2009.

”Motorola is committed to providing leading communications technology to meet the growing demand of Vinaphone in providing high quality and reliable voice and data communications services to subscribers,” said Owen.

“Motorola is an industry leader and we are pleased to work with them in GSM network deployment. The contracts aim to expand our GSM network deployed in the northern provinces of Vietnam last year. It will enable us to provide better coverage, capacity and user experience in rural and suburban areas,” said Hai.

Motorola and Vinaphone signed contracts December 2007 to expand and enhance Vinaphone’s GSM network in Vietnam ’s major cities, including Hanoi and Ho Chi Minh City . Beside GSM networks, the two companies are also cooperating in expanding GPRS coverage and providing EDGE services in Vietnam .

Vinaphone currently provides coverage in 64 provinces and cities in Vietnam and has links with mobile operators in more than 60 countries and governed territories.