Last update: 08:30 | 14/05/2017
The Military Commercial Joint Stock Bank (MB) and Experian, an Ireland-based global information services company, signed an agreement on Tuesday to implement a Credit Risk Modelling project for Basel II.
Under the contract, Experian will provide consultancy and teach advanced methodologies, including developing software to measure credit risk in accordance with Basel II; helping complete credit risk estimates under the Internal Rating-Based (IRB) method; and helping MB put the system into operation by 2019.
Basel II is an international business standard that requires financial institutions to maintain enough cash reserves to cover risks incurred by operations. The Basel accords are a series of recommendations on banking laws and regulations issued by the Basel Committee on Banking Supervision (BSBS).
Basel II improves on Basel I, first enacted in the 1980s, by offering more complex models for calculating regulatory capital. Essentially, the accord mandates that banks holding riskier assets should be required to have more capital on hand than those maintaining safer portfolios. It also requires companies to publish both the details of risky investments and risk management practices.
Speaking at the signing ceremony, Le Cong, vice-chairman of MB, said the bank has identified the Risk Management Platform as one of the two important areas in its development strategy for the 2010-15 and 2017-21 periods. “We have implemented many solutions to continuously improve our risk management capacity and meet the business development and compliance requirements of the State Bank of Viet Nam,” Cong said.
MB is among the 10 commercial banks chosen by the central bank to implement the pilot phase of Basel II in the 2014-17 period. The bank has upgraded its operations, a compulsory requirement, making its banking operations safer and more efficient.
Nick Boyle, executive director of Experian Southeast Asia, said MB is one of the top banks in Viet Nam, and it will implement the best international practices and get Basel II accreditation by 2020.
Determined to launch Basel II successfully, MB has been perfecting its management model by applying international norms and practices to change its approach towards risk-based business decisions in areas such as operational management, risk management model, risk management policy framework, measurement tools, and effective risk management.
Deputy PM highlights significance of North-South Expressway project
The North-South Expressway is an important national project, which needs Government approval before submission to the Politburo and National Assembly, stated Deputy Prime Minister Truong Hoa Binh at a recent meeting on the project.
The Deputy PM asked the State appraisal council for the project to promptly appraise the project and report to the Government.
Additionally, the Ministry of Transport was asked to complete a report on the project for the Politburo and National Assembly, clarifying the total investment, progress schedule, the significance of the project, and policies needed to implement it.
The Deputy PM also said that policies and mechanisms are needed to draw investment and hasten the progress of the project. However, they must be conducted in an open and transparent manner.
Ministries were also urged to send their ideas on mechanisms and policies for the project to the Ministry of Transport by May 15.
Deputy PM Binh also agreed on adding the Dau Day-Phan Thiet section to the project, saying it will be discussed in another meeting.
A national steering committee will be set up on the investment of the project led by Deputy Prime Minister Trinh Dinh Dung. The committee will have responsibility for directing the implementation of the project.
Meanwhile, the Ministry of Transport will be in charge of conducting the project.
The State Bank of Vietnam was assigned to propose measures to mobilise capital resources for the project, while monitoring the provision of credit to ensure investors’ responsibility in providing promised capital.
The Ministries of Planning and Investment, Finance, Natural Resources and Environment, Construction and other relevant ministries and agencies were requested to design supervision over the implementation of the project in the form of build-operate-transfer.
Nutifood invests in Dak Lak hi-tech agriculture
Viet Nam Nutrition Food JSC (Nutifood) on Thursday signed a co-operation agreement with the provincial People’s Committee of Dak Lak to invest more than VND1 trillion (US$44.1 million) in high-tech agriculture.
Under the agreement, NutiFood committed to developing provincial high-tech agriculture in the coffee industry by sowing seeds, cultivating, harvesting and processing. This is expected to improve productivity, increase the product’s value and promote export activities to foreign markets.
In addition, NutiFood will invest in constructing a factory for processing coffee products, leading to the establishment of a coffee brand associated with the province’s geographical origin.
Nutifood is also designated to be the sole strategic shareholder of Phuoc An Coffee Company through its purchase of 25 per cent of the company’s shares, even as it targets 51 per cent in the future through auctions.
With the investment of NutiFood, Phuoc An will be required to meet conditions to restructure, renovate and improve the efficiency of land use. On the basis of high-tech agriculture, the company can look towards organic and clean coffee products, bring added value to agricultural products with high export value.
Nutifood’s board chairman Tran Thanh Hai said the company decided to invest in Dak Lak’s high-tech agriculture to increase the value of Vietnamese agricultural products.
The co-operation also responded to the Prime Minister’s direction to lead Viet Nam towards becoming a modern and multifunctional centre for the supply of high-tech agricultural products to the international market, Hai added.
In addition to promoting coffee plantation, Nutifood will conduct research and surveys to apply hi-tech agricultural areas into the development of dairy cows and raise the value of the agriculture sector for the province.
Binh Phuoc calls for Singapore’s investment
The southern province of Binh Phuoc held a conference on May 11 to call for investment from Singapore to 63 key projects.
Addressing the event, Chairman of the provincial People’s Committee Nguyen Van Tram introduced his locality’s strengths.
Located in the south, Binh Phuoc is a gateway to the Central Highlands region, Ho Chi Minh City and Cambodia.
It boasts clear lands and good conditions for industry development, including convenient transport infrastructure and favourable policies for investors.
Prices to lease land for 50 years in Binh Phuoc are between 20 and 30 USD per square metre, compared to 100 – 150 USD per square metre in neighbouring localities, such as Binh Duong and Ho Chi Minh City.
Tram stressed that local authorities complete administrative procedures for foreign investors quickly, including those from Singapore.
He said there are only three Singaporean projects worth 8.1 million USD in Binh Phuoc, expecting more Singapore capital to flow into local high-tech agriculture, clean technology and animal feed production.
Singapore has annual demand to import about 2 billion USD of rubber and 80 million USD of cashew, Tram said, adding that his province supplies both products in large quantities.
He said the conference is an opportunity for both sides to form partnerships.
Benson Lim, executive director of Singapore-based R1 International Pte Ltd, which invests in Binh Phuoc’s rubber industry, said the Vietnamese province tackles administrative procedures for investors efficiently and has good infrastructure with a direct highway system to Ho Chi Minh City.
He said his company is looking for an area in Binh Phuoc to build a new factory three-time larger than the current one.
According to the Singapore Business Federation (SBF), Singaporean firms rated Vietnam as the third most attractive investment destination in ASEAN.
Since the beginning of 2017, the SBF in collaboration with the Vietnam Embassy in Singapore, Vietnam Chamber of Commerce and Industry, and Vietnamese localities have held a series of trade promotion conferences and fact-finding tours to help the two countries’ firms form business partnerships.
Agricultural branding: a must for enhanced competitiveness
A lack of branding for agricultural products makes it difficult for Vietnamese commodities to gain advantages and footholds in foreign markets. For that reason, building brands for agricultural products is highly necessary to increase competitiveness for agricultural commodities produced in Vietnam.
According to the Department of Agro-product Processing and Marketing, under the Ministry of Agriculture and Rural Development (MARD), around 90% of Vietnam's agricultural products are still exported in raw forms at lower prices than those of other countries. Notably, over 80% of agricultural products have not been integrated with a brand, sold without logos or labels and sold internationally using foreign branding.
Statistics from the National Office of Intellectual Property, under the Ministry of Science and Technology, show that in more than 90,000 trademarks of all kinds registered for protection in Vietnam, only about 15% of them belong to domestic enterprises. This is a big disadvantage, weakening Vietnamese agricultural products’ competitiveness and forcing the sector to face many disadvantages.
The cause of this situation is partly due to limited awareness on branding strategies from agro enterprises. They have failed to clearly understand the role and significance of building and protecting agricultural product brands, while still implementing branding strategies without cooperation or consensus.
At the same time, conditions for branding have not been determined for most agricultural products, such as products must be in a large enough volume with stable productivity, uniform quality, and ensured food hygiene, as well as at competitive prices. Distribution channels must be organised in harmony with reasonable interests for all participants.
However, at present, even Vietnam’s major agricultural products, such as rice, seafood, and coffee, are still struggling with the issues related to planning raw material areas and quality assurance.
Currently, the quality of agricultural products is not just being spread through word-of-mouth, but more importantly, the product must be clearly labelled and packaged, showing sources of origin. Thus, signing exclusive trademarks and branding should be prioritised to win the trust of consumers.
Farmers themselves cannot do the work alone without the important role and participation from the business community. The latter need to coordinate with farmers in agricultural product branding, linking all stages of production, processing and consumption, especially quality control. At the same time, businesses also need to "shake hands" to jointly invest in science and technology, while gradually restricting the export of raw materials and gradually shifting to processed export to improve products’ value and create sustainable brands.
To assist the branding journey, the MARD has recently developed a programme for the development of major agricultural product brands up to 2020, with a focus on five key products, including mango, dragon fruit, tea, coffee and tra fish. In addition, for rice exports, the ministry has launched a national logo designing contest to seek for Vietnam’s national rice brand.
Vietnam has lagged behind many other countries in building brands for agro products, however it is better late than never, particularly in the context of deepening international economic integration. The orientation will facilitate functional agencies to develop reasonable policies to help businesses and farmers improve branding conditions, thereby giving them the opportunity to expand branding to other agricultural products in the coming time.
Thai rope manufacturer awaits listing on May 16
Siam Brothers Vietnam is going to be listed on the Ho Chi Minh City Stock Exchange (HoSE) with the ticker SBV on May 16.
The listing followed the company’s initial public offering in November 2016, when the company sold 4.2 million shares.
Accordingly, 20.54 million SBV shares are going to have an initial reference price of VND 40,000 ($1.76), equal to the price proposed by the listing consultancy Ho Chi Minh City Securities Corporation (HSC). On the first trading day, the price of the stock is allowed to fluctuate in the range of +/-20 per cent.
Before becoming a joint-stock company, SBV was a wholly-owned Thai company specialising in manufacturing rope and nets used for fishing, maritime transportation in the industrial and agricultural sectors.
At the moment, the company has a chartered capital of VND205.4 billion ($9 million) of which the Thai founding shareholders hold 75 per cent and individual and institutional investors hold 25 per cent. Of the latter, Vietnam Holding Ltd. is the most significant, holding 10 per cent.
Over the past 20 years of development in Vietnam, SBV has conquered the market with its durable products. Though the company products’ prices are higher than competitors’, it still dominates the domestic market with a share of over 40 per cent of ropes used in agriculture, fishing, and maritime safety and its specialised rope products are the top choice for 90 per cent of offshore fishing boats.
With the advantage of market domination, SBV has maintained stable growth with a compound annual growth rate of 13.42 per cent in revenue and 18.7 per cent in net profit in the past five years. In 2016, the company earned a revenue of VND508 billion ($22.34 million) and net profit of VND113.89 billion ($5 million), up 38.6 per cent on-year thanks to the decrease of material prices and the company’s successful cost-cutting policies. This helped SBV achieve an earnings per share (EPS) of VND6,110 (27 US cent).
The shareholders agreed on a cash dividend of VND2,000 (9 US cents) for 2016 at the recent shareholders’ meeting.
In 2017, the company expects a revenue of VND601 billion ($26.4 million) and pre-tax profit of VND149 billion ($6.55 million), banking on the increasing demand for its products.
The company is also developing some new products to take advantage of the growth of the seafood and agricultural sectors. In the first quarter of 2017, the company reported a revenue of VND100.3 billion ($4.4 million) and net profit of VND11.7 billion ($514,570), increases of 28 and 14.7 per cent on-year, despite this being slowest quarter of the year.
ACV feels heat from foreign exchange rates in Q1
There are times when official development assistance (ODA) loans backfire and that is exactly what has happened to the State-owned Airports Corporation of Vietnam (ACV), with it suffering from increased financial expenses due to the appreciation of the Japanese Yen (JPY) against the Vietnam dong (VND) during the first quarter.
In March, the Vietnamese Government was reported to have given approval to the French airport authority’s Aeroports de Paris (ADP) acquiring 20 per cent of ACV and becoming its strategic partner. A representative from ACV told VET on May 11, however, that the 20 per cent stake sale is still under negotiation and declined to give a specific timeline.
ACV’s newly-published first quarter 2017 consolidated financial statement showed its total revenue in the period reached VND4.08 trillion ($179.56 million), mainly from services, which accounted for 87 per cent, or VND3.6 trillion ($158.43 million). The remainder came from sales and other activities.
Of the VND20 trillion ($880.2 million) in total liabilities as at March 31, VND14.6 trillion ($642.5 million) was long-term borrowings and financial leasing liabilities in JPY through ODA capital, including loans from the Japan International Cooperation Agency (JICA) for the construction of Terminals 3 and 4 at Tan Son Nhat International Airport in Ho Chi Minh City and loan agreements to build Terminal 2 at Hanoi’s Noi Bai International Airport.
The corporation had total financial expenses of VND683 billion ($30 million) during the period, VND647.5 billion ($28.5 million) of which was foreign exchange losses, with it to pay more than VND31 billion ($1.36 million) in interest. According to XE.com’s data, the JPY appreciated approximately 5 per cent against the VND during the January-March period.
At end-March, ACV’s consolidated after-tax profit stood at VND 772 billion ($34 million), with earnings per share at VND355 ($0.02). As the corporation officially became a joint stock company from April 1 last year, there are no year-on-year comparisons. Its total assets stood at VND44.84 trillion ($1.97 billion) and charter capital VND 21.77 trillion ($958 million) at the end of the first quarter.
It posted a net profit of VND2 trillion ($87 million) on revenue of VND14.5 trillion ($635 million) in 2016. It aims to increase revenue by 8 per cent and pre-tax profit by 3 per cent every year during the 2017-2020 period.
ACV is the monopoly operator of 22 airports throughout Vietnam, of which nine are international and 13 are domestic. It is calling for investment in more airports, to increase the number to 23 by 2020 and 25 by 2030. It plans to list over 2.1 billion shares on the Ho Chi Minh Stock Exchange by the end of this year.
During the 2017-2021 period, the corporation targets passenger volumes to grow at 14 per cent per annum, with international and domestic passengers to increase 14 per cent and 13 per cent year-on-year, respectively. Growth in cargo volumes are to rise by 8 per cent year-on-year during the period, the number of landings to grow 14 per cent, and net sales to rise 8.5 per cent per annum.
Startup businesses get access to aid of $87,977
The Department of Science and Technology in Ho Chi Minh City yesterday organized a seminar to guide startup businesses to apply for aid from the SpeedUp 2017 program in Saigon Innovation Hub (SIHUB).
SpeedUp 2017 launched by the Department in early January 2017 is a program to back startup people who can receive aid of VND2 billion ($87,977) during two years.
The program is considered as an activity to boost startup businesses which were launched in 2016. The Department organized the guidance seminar because very a few startup businesspersons have come to ask for the loan from the Department since the beginning of the year.
Meantime, as per Topica Founder Institute (TFI)’s latest report, Vietnamese startup community has called for a capital of $205 million in 2016, an increase of 46 percent compared to 2015.
Startup businesses in Fintech have been contributed with $129 million becoming the leading in the community. Largest startup businesses in 2016 are Payoo, VNPT E-pay and Tiki.
VNPT EPay was founded in 2008 by VMG Media and Vietnam’s third largest state-owned mobile network operator Vietnam Post and Telecommunications Group (VNPT).Vietnamese mobile content provider VMG Media has sold its entire stake of 62.25 per cent in VNPT EPay to UTC Investment with total cost of $34 million.
Vietnamese technology giant VNG Corporation (VNG) has purchased 38 per cent of the Tiki Corporation, the owner of the e-commerce website Tiki.vn.
Vietnamese startup business have actively found out the capital source from foreign investors because foreign investors are quick in assessing projects. It proves that foreign investors poured a lot of money in startup businesses.
The aim of SpeedUp 2017 program is to connect startup business community with investors, institutions, consultation groups and service providers to promote mature business; accordingly, the city will provide VND2 billion to each startup projects which was announced in end of the 2016. Yet the program has not worked as expected.
The SpeedUp 2017 program has not worked as expectation because it is just for startup businesses registered in HCMC which were established less than five years.
Moreover, the department placed top priority on projects of mechanism- automation, electronic- IT, chemical-pharmaceutical- plastic – rubber, food processing, biological technology.
More information of the program, people should search in http://sihub.vn/speedup2017/
Information of registration and regulation of setting up a company, people should go to http://dost.hochiminhcity.gov.vn/pages/doanh-nghiep-khcn.aspx
BIM’s condotel project in Ha Long makes waves
Forecasts are optimistic for the real estate market this year, and the rising number of condotel projects indicate that Viet Nam’s property sector is catching up with other Asian markets.
Condotels – a combination of a condominium and a hotel – are becoming popular among investors, and these projects are currently mainly concentrated in the central and southern markets of Da Nang, Nha Trang and Phu Quoc.
Major developers such as Vingroup, Sun Group and BIM Group are now launching such projects. Recently, the BIM Group introduced a condotel project in Quang Ninh Province, a popular tourist destination in the country’s northern region.
Called the Citadines Marina Halong, the project in Ha Long has made waves in the northern realty market for its investment opportunities. The condotel will be professionally managed by Ascott Limited, one of the world’s leading serviced apartment operators and owners.
As condotels become more and more popular, Citadines Marina Halong, which includes 176 luxury condominiums and 637 condotels, catches up with the trend of owning a property that will combine good investment and a luxury holiday.
The demand for condotels has been rising. Besides owning a second home, owners can join in a rental programme that allows the operator to run the leasing and owners can get returns of up to 9 per cent per year, the BIM Group said, speaking about its project.
Headquartered in Singapore, Ascott Limited has 30 years of experience in running serviced apartments, so owners of Citadines Marina Halong won’t need to worry about caring for their properties or finding customers.
Located in BIM Group’s Halong Marina Urban Area along the Ha Long Bay, Citadines Marina Halong offers sea views and easy access to the Halong Marina Plaza, CGV Cinema, Litte Vietnam shophouse, Singapore SIS International School, a man-made beach, Sunworld Ha Long Part, Sun Wheel, Zen Garden and Tuan Chau Complex.
The BIM Group, which started development in Ha Long 20 years ago, has partnered with top global brands, such as InterContinental Hotels Group, Regent Hotels & Resorts, Fraser Suites, and now Ascott Limited, for its various projects.
Eco-Products Int’l Fair promotes green growth
The Eco-Products International Fair 2017 (EPIF) opened at the Saigon Exhibition and Convention Centre in HCM City on Thursday with the theme “Green Technologies and Products: Actions for the Future”.
The event is co-held by the Asian Productivity Organisation (APO), the Viet Nam Environment Administration (VEA) and the Viet Nam Chamber of Commerce (VCCI).
Addressing the opening ceremony, Deputy Minister of Science and Technology Tran Viet Thanh said "EPIF 2017 is an important event that reflects the direction of Viet Nam’s economic development."
"It also aims to raise public awareness of sustainable development through production and consumption of eco-friendly products, services and technologies," he noted.
As sustainable growth is a vital strategic direction for national development, the government’s policies and regulations have been improved to facilitate the private sector producing green products, according to the minister.
Local firms should shift their focus on developing eco-friendly products and services to meet the increasing demand of consumers and strict requirements of the global supply chain, he suggested.
VCCI vice president Hoang Quang Phong said the event would provide an opportunity for not only enterprises to show off their latest green products and services and seek partnership but also policymakers to identify needs and solutions for green growth in Viet Nam.
Hajime Bada, chairperson of the Japan-based Green Productivity Advisory Committee, described the fair as a bridge for firms to set up cooperation and transfer of green production and renewable energy technologies.
The EPIF was initiated by the APO in 2004 and is organised in rotation between APO members. Viet Nam is hosting the event, which runs until Saturday, for the second time.
VN, US meet to boost agriculture co-operation
The United States Department of Agriculture’s (USDA) catfish inspection programme was not yet suitable for Viet Nam and more bilateral discussions were needed, the Government said on Thursday.
Deputy Minister of Agriculture and Rural Development (MARD) Tran Thanh Nam spoke in Ha Noi at a meeting between senior Vietnamese and US officials to boost trade relations in the agricultural sector.
Nam said he hoped the US would create more favourable conditions for Vietnamese businesses in fishery processing and other fields of cultivation so that they can strengthen trade ties with their American counterparts.
Also, Viet Nam hopes that the USDA would soon approve procedures for the export of Vietnamese mangoes and star apples to the US, the deputy minister said.
In addition, the country wants support in technology and organic agricultural projects, including support training courses on organic product certification for Vietnamese experts, Nam added.
Nam asked the US to transfer the inspection programme on plant quarantine to Viet Nam while continuing to help monitor the amount of plant protection drugs found in products exported to the US.
Robert Macke, chief of the USDA’s Office of Agreements and Scientific Affairs and Foreign Agricultural Service, said the US had worked to address Viet Nam’s concern over catfish inspection over the past few years, and affirmed the country’s support for Viet Nam in the matter.
He called for the MARD’s support to get the Vietnamese Government’s approval of the US Embassy’s proposal on new USDA positions at its offices in Ha Noi and HCM City.
Other topics discussed include food safety co-operation in APEC and other bilateral trade collaboration issues.
Binh Phuoc seeks Singaporean investment in 63 projects
The southern province of Binh Phuoc called for Singaporean investment in 63 prioritised projects during an investment promotion conference in the coastal country on Thursday.
These projects specialise in a wide range of sectors, including construction development of industrial zones, agriculture and food processing, energy and trade, as well as tourism and services.
Chairman of Binh Phuoc People’s Committee Nguyen Van Tram briefed the conference on the provincial advantages for investment attraction, such as favourable geographic location (a gateway connecting Tay Nguyen region, HCM City and Cambodia), and an abundant resource of clear land and raw materials for industrial and agricultural development.
The province has also been perfecting infrastructure facilities and speeding up administrative reforms to better facilitate investors, including those from Singapore, he said.
As of last year, the locality attracted 157 foreign-invested projects with total investment capital of US$1.4 billion. However, only three of the projects, worth $8.1 million, were financed by Singaporean investors.
Therefore, Binh Phuoc hoped to lure more investment from Singaporean businesses, especially in hi-tech farming, clean industries and animal feed production, the chairman said.
Benson Lim, managing director of R1 Company, which is investing in the rubber processing industry in Binh Phuoc, praised the efforts of local authorities in solving difficulties faced by foreign investors in a timely manner and said his company planned to expand its operation in the province in the future.
According to Singapore Business Federation (SBF)’s latest survey, ASEAN was the top region where Singaporean businesses wanted to expand their investment, while Viet Nam ranked third among the Southeast Asian countries for targeted investment.
Since the beginning of this year, SBF has co-ordinated with the Viet Nam Chamber of Commerce and Industry and Vietnamese localities to organise business conferences in respective countries and business trips for two nations’ firms to help them ultilise trade and investment co-operation opportunities.
APEC debate skills training, social protection in digital age
The Human Resources Development Working Group (HRDWG) organised a workshop on skills education & training and social protection in Hanoi on May 12.
As part of the APEC 2017 Second Senior Officials Meeting (SOM2) and related meetings, the workshop aims to discuss opportunities and challenges in skills education & training and social protection in the context of digitalisation and rapid technological development as well as seek solutions to these challenges.
In his opening remarks, Deputy Minister of Labour, Invalids and Social Affairs (MoLISA) Doan Mau Diep said that the fourth Industrial Revolution (Industry 4.0) is a global trend, driven by science-technology development.
“The foundation of this revolution is the digital technology and the synthesis of intelligent technologies in order to optimise the process and mode of production,” he stated.
According to Diep, Industry 4.0 has been creating breakthroughs with tremendous impacts on socio-economic development of each country, region and the entire world. In that context, vocational education and training and social protection are issues that attract the attention of all economies in the Asia-Pacific region.
With the booming of Industry 4.0, there will be strong labour mobility. Many traditional occupations will disappear to be replaced by many new ones (in the areas of digitalisation, programming and data protection), he said.
There will be many more requirements for skills and qualifications of the workforce for employment, posing great challenges to the labour market, he said, adding that not only low skill workers but also middle skill ones will be affected if they are not self-equipped with new technology and innovation skills.
According to Mary Morola, Coordinator of the APEC Labour & Social Protection Network, Industrial 4.0 requires APEC member economies to share opportunities in investment and vocational training to ensure the stability of the regional labour market.
Participants to the workshop focused on discussing measures to promote social protection in region in order to ensure all social protection schemes are resilient to demographic changes, social and economic shocks, and natural disasters on the one hand and benefits of social protection do not create work disincentives on the other hand.
The information shared at the workshop will be an important foundation for the APEC High-Level Policy Dialogue on Human Resources Development in the Digital Age to put forth priority actions for the Asia-Pacific region to help member economies successfully accomplish the goal of “no one is left behind”, Diep said.
POSCO to build second coal-fired power plant
The POSCO Group from South Korea has been granted approval to build a second coal-fired power plant in Vietnam.
Valued at $2.5 billion, the Quynh Lap 2 project will be built in Hoang Mai commune, north-central Nghe An province, on a land area of 171 ha and 37 ha of water surface. It will be POSCO’s second coal-fired power in Vietnam, following Mong Duong 2 in northern Quang Ninh province.
Quynh Lap 2 will consist of two units with a total capacity of 1,200 MW and be invested in the build-operate-transfer (BOT) form, with ownership transferred after 25 years of operations.
The project is expected to begin in 2022 and be completed in 2026. POSCO said at a meeting with provincial leaders that the ratio of equity and loans is 25 and 75 per cent. A loan will come from direct export credit funds and an export credit loan guaranteed by Korea Eximbank and Korean Financial Group, with a 15-year term.
Construction of Quynh Lap 1 began in October 2015 with total investment of $2.2 billion and Vinacomin as the investor. It is expected to begin operations in 2020.
POSCO (formerly the Pohang Iron and Steel Company) is a multinational steel-making company headquartered in Pohang, South Korea. It had an output of 42 million tonnes of raw steel in 2015, making it the world’s fourth-largest steelmaker by volume. In 2010, it was the world’s largest steel manufacturing company by market value, and in 2012 was named the 146th largest corporation in the world in the Fortune Global 500.
POSCO also operates 25 domestic subsidiaries and affiliates in areas such as construction, architecture, IT services, and research, etc. It also has 23 overseas subsidiaries and affiliates in countries such as Hong Kong, China, Myanmar, the US, Japan, Brazil, Thailand, South Africa, and Vietnam. It also has plans to increase the number of processing plants overseas to more than 40.
Vietnam facilitates German partnership with local firms
Vietnam will facilitate German enterprises’ partnership with local firms in different fields of economy, culture, education and environment, said Nguyen Hoang Long, head of the Foreign Affairs Department at the Ministry of Foreign Affairs, on May 12.
He made the remarks at the workshop Meet Germany 2017 co-held by the Delegate of German Industry and Commerce in Vietnam and the Foreign Affairs Department in HCM City.
Germany is Vietnam’s biggest trade partner in the EU that acts as a key transit point for Vietnamese exports to the Europe, Long said.
He cited the fact that investors from Germany have operated many projects across Vietnam while more than 100,000 Vietnamese expats and 8,000 Vietnamese businesses are residing in the EU country.
There will be more opportunities for the two countries to enhance cooperation and exchanges in trade, culture, education and environment, the official affirmed.
Speaking at the workshop, Iris Gleicke, Parliamentary State Secretary in the Federal Ministry for Economic Affairs and Energy, spoke of Vietnam’s important geographic location. German firms have realized great potential for investment in Vietnam as from there they can get easier access to other countries in Southeast Asia, she said.
In fact, they also obtained many support from local authorities in Vietnam, she noted.
The workshop featured a direct dialogue between local authorities and state agencies and 20 enterprises from Germany whose inquiries focused on process and procedures for starting an investment project in Vietnam.
Representatives from authorities of HCM City, Da Nang, Dong Nai, Long An and Binh Duong also provided the German companies with updates on public administration reforms, including the application of information technology, making appointments via phones, and 7-day service for granting an investment license.
HCM City currently hosts about 132 German-invested projects, worth over 132 million USD while Germany has operated seven projects in Dong Nai with a total investment of more than 700 million USD, representing roughly half of its investment in Vietnam.
Industrial revolution poses challenges to APEC economies
The globalisation process and the fourth industrial revolution is posing big challenges to member economies of the Asia-Pacific Economic Cooperation (APEC) Forum in general and Vietnam in particular, said a Vietnamese official.
Deputy Minister of Labour, Invalids and Social Affairs Doan Mau Diep delivered this message at the “Workshop on the World of Work and Labour Market Information in the Digital Age” which was held in Hanoi on May 11 in preparation for the High Level Policy Dialogue on Human Resources Development in the Digital Age.
The workshop takes place at a time when the world of work is experiencing great structural changes due to technological advances, specialised production and growing demand for highly skilled workers and changing labour relations.
Technology and digitalisation are expected to make important contributions to improving productivity, expanding economic growth and generating jobs. But, technology and digitalisation are also creating risks related to employment.
A study conducted by the International Labour Organisation (ILO) showed that new technologies will be applied thoroughly in labour-intensive industries, resulting in big cuts in low-skilled labour workforce.
The APEC member economies are facing challenges in satisfying the manpower demand for the digital economy. These are also challenges that the economies are coping with in implementing structural reforms to support investment in human resources development and market restoration.
For Vietnam, Diep said the government already set out the tasks of renovating the growth model, restructuring the economy and taking full advantage of scientific and technological advances, towards improving quality of economic growth and bolstering rapid, sustainable development.
He stressed that Vietnam is lacking highly-skilled technicians and workers, especially in the key industries of mechanical engineering, electronics, and electric techniques as well as in sectors that have strong impacts on high and sustainable growth amid international integration.
The shortage of highly-skilled workers has worsened due to shortcomings in labour demand-supply connection, Diep said, adding that improving the labour market information system and reducing time for labour demand-supply connection is seen as an urgent and feasible task in the age of information technology.
The Human Resources Development Working Group (HRDWG) is sparing no effort to build a draft document on human resources development in the digital age. This initiative is aimed at enhancing regional cooperation in personnel training to cope with challenges in the digital age, focusing on labour market development, education and vocational training, and social security, Diep said.
Experience, vocational training models and policies on the labour market and social security shared at the workshop will help the APEC economies draw lessons and boost cooperation in the process of sustainable development.
Conference highlights investment opportunities for Belgian firms in Vietnam
Vietnam’s economic and trade development as well as the country’s advantages in attracting investment were introduced to Belgian enterprises at a conference in Belgium’s southern Mons city on May 10.
Participants at the event highlighted positive impacts of the Vietnam-EU free trade agreement (EVFTA) and proposed measures to expand import-export activities between the two sides.
Nguyen Canh Cuong, Vietnamese Trade Counsellor in Belgium noted that Vietnam has maintained stable development with GDP growth of 6-8 percent, while exports and imports rose 20-30 percent each year recently.
He stressed that abundant business opportunities are available in many areas for potential investors, adding that the prospect is bright as the Vietnamese Government is in the process to sign the EVFTA.
Meanwhile, Frauker Sommer who is in charge of EU’s bilateral trade with Vietnam, introduced the EVFTA and gave her assessment on benefits in tariff and import-export brought by the deal as well as comparative advantages of each side and ways for businesses to expand their import-export activities.
She underlined that EVFTA is the best free trade agreement that EU has reached with a developing country.
Speaking to Vietnam News Agency correspondent in Belgium, Hainaut province’s Governor Tommy Leclercq said that the province, the largest locality in Belgium’s Wallonia French-speaking region, hopes to promote economic ties with Vietnam in various areas, especially in import-export.
He said that following the conference, the province will hold a number of business seminars focusing on fields important to Vietnam and attractive to Belgian investors.
The governor also revealed that the province has plans to send a delegation to Vietnam in September or October this year to discuss cooperation possibilities with potential partners.
General Director of Delaunoit group Jaques Delaunoit said that with the support of the European Commission, he has realized feasible investment opportunities in Vietnam.
According to Chairman of the Belgium-Vietnam Chamber of Commerce Huynh Trang Long, many Belgian businesses are keen on seeking partnership with Vietnam for stronger economic ties.
Five Vietnamese tourism startups enter MIST final round
Five Vietnamese startups namely Bayo, I Love Asia, Dichung, Chameleon City and Morning Rooms have been selected to the final round of the Mekong Innovative Startup Tourism (MIST) awards.
They will present their business plans at the upcoming Mekong Tourism Forum together with eight others from Cambodia, Laos and Myanmar to vie for four prizes worth US$7,000-10,000 each.
Leading tourism experts chose 12 out of total 250 entries from four countries on a wide range of fields such as tourism technological solutions, traditional tourism products, hospitality services, accommodation, restaurants and social businesses.
One of criteria to choose startups to present their business plans at the Mekong Tourism Forum is their contributions to socio-economic and tourism development in the Greater Mekong Sub-region, and job generation for local people, especially women, said Mr.Jens Threanhart, Executive Director of the Mekong Tourism Coordinating Office.
The Mekong Tourism Forum which will be held in Laos on June 6-9 provides a cooperative platform for public and private sector stakeholders in the tourism industry to discuss the development, marketing and promotion of travel to, from and within the Greater Mekong Subregion (GMS), and monitor sustainable and responsible tourism growth.
Spec Go Green Awards 2017 kicks off
A press conference was held in Hanoi on May 10 to kick off the Green Architecture Awards 2017 by the Vietnam Architecture Association and the Kien Viet Joint Stock Company.
The award, known as Spec Go Green International Awards, focused on green architecture and projects which have made positive contribution to the community.
Under the sponsorship of Spec Go Green of Thai paint producer 4 Oranges Company, 10 awards will be presented to architectural students. The first, second and third prize winners will receive US$4,000, US$2,000 and US$1,500 respectively.
In addition, ten prizes for young architect category will be awarded, of which the first, second and third prizes are valued at US$10,000, US$5,000 and US$3,000 respectively. Total cash value of the awards is about VND1 billion. The awards ceremony will be held in December 2017.
Since the launch in 2014, Spec Go Green has been the prestigious awards for young architects and students, aiming to honour green architecture which is friendly to the environment and sustainable development.
Vietnamese enterprises grappling with talent strategy
Multinational companies (MNCs) focus on building talent management strategies right from the early stage of their business but many of Vietnamese companies do not, the “Talent Management Strategy: Build to Win” seminar hosted in Ho Chi Minh City by Talentnet heard.
More than 50 CEOs from both local companies and MNCs in Vietnam defined certain challenges that their companies are currently facing in resolving the talent strategy puzzle, following the results of the first-ever survey about the views on talent management among CEOs in Vietnam.
More than 53 per cent of Vietnamese businesses out of 63 respondents still do not have a proper concept of a “talent management strategy” and are struggling with the psychological fear over building, buying, or borrowing rising stars in the company.
“This mindset is rooted in leadership capacity constraints, standardization in the establishment of the human resources (HR) system, as well as differences in human capital purposes,” said Ms. Tieu Yen Trinh, CEO of Talentnet. “While 69 per cent of MNCs defined the criteria and the framework for selecting their talent pool and have an obvious tendency to build their talent internally, local firms own a mixed talent pool from different sources (build, buy, and borrow). This is mainly due to a lack of a strategic talent assessment system that allows companies to evaluate the right people for the right business goals in the long term.”
The poll of 63 CEOs also found that an overwhelming majority believe people capacity is one of the major concerns for their business and had HR strategies in place. A majority perceived “Talent Management” as a system with defined tools to help them achieve talent objectives, and it was more defined at multinationals than local companies.
However, talent strategies were lacking at nearly half of local companies and a few multinationals. Ms. Trinh told the gathering that 47 per cent of the CEOs polled revealed they have a talent strategy linked to their business strategy, while 17 per cent said they had a strategy but it was not linked to their business strategy because it was too complicated and depended on the competence of HR and line managers to be executed. The remaining 36 per cent said their business did not have a talent strategy.
According to Ms. Trinh, many Vietnamese firms, after a period of rapid growth, encounter a bottleneck when they do not have sufficient human resources with the skills and mindsets needed for that stage of development. They then think of investing in talent, but by then it is too late.
According to the survey, the main HR focus this year at both local and multinational companies is training and developing their existing workforce and enhancing workforce productivity. The survey pointed out some obstacles Vietnamese companies face in developing and implementing a talent strategy, such as the lack of line managers’ involvement in identifying employees’ profiles, their bias in assessing talent, and their belief that the development of people’s capacities and careers is HR’s job.
Other obstacles are that line managers do not want to share their talented workers with other departments or business units and there are no different reward schemes to recognize and retain talent, Ms. Trinh said.
Vietnam was ranked 86th out of 118 countries in the latest annual Global Talent Competitiveness Index (GTCI), which measures how countries grow, attract, and retain talent. According to the report, Vietnam scores relatively better in global knowledge skills (i.e. using the available higher skills to support innovation and engage in entrepreneurship).
But the country is struggling in terms of attracting talent and developing a pool of vocational and technical skills, Ms. Trinh said. Talking about talent challenges in the region, Ms. Joanna Yeoh, a strategic HR and talent management practitioner, said “the region has a very large number of young workers but lacks depth of expertise and managerial skills and suffers from brain drain and migration.”
“It has an improving educational system but low skill confidence, multinationals entering the market and hiring away talent, and compensation costs outpacing productivity and ability,” she said.
SBV promoting private sector investment for green growth
The State Bank of Vietnam (SBV) and the Macroeconomic Reforms/Green Growth Programme of the Vietnam-German Cooperation organized a conference on May 10 on “Promoting Investment of the Private Sector for Green Growth via the Banking System”.
The conference was held within the framework of the Macroeconomic Reforms/Green Growth Programme, implemented by GIZ Vietnam on behalf of the German Federal Ministry of Economic Cooperation and Development (BMZ).
In order to implement the National Green Growth Strategy and National Action Plan on Green Growth for the 2014-2020 period, the SBV Governor had earlier promulgated Directive No.3 in 2015 on promoting green credit and the management of social and environmental risks in credit granting activities and Decision No.1552 in 2015 setting out the action plan for the banking sector to implement the National Green Growth Strategy to 2020.
The conference was another step following numerous efforts by the SBV to contribute to channeling investments from the private sector through the banking system to support achievements in transforming the national economy towards being greener and more socially and environmentally sustainable.
In her opening address, SBV Deputy Governor Nguyen Thi Hong emphasized the decisive role of the banking system in “greening” investment capital flows to the economy and in credit risk management towards green growth. “The two most important issues are resources mobilization and the development of credit programs with appropriate targets in line with the criteria for green and environmentally-friendly projects,” she said.
For his part, Dr. Michael Krakowski, Program Director and Chief Technical Advisor of the Macroeconomic Reforms/Green Growth Programme, said the program is committed to actively supporting Vietnam’s central bank “to develop an appropriate policy framework for green investment and green financial products and to channel domestic and international funding sources through the finance and banking system towards green investments, especially those from increasing global climate and green funds, while at the same time bolstering the cooperation with the SBV to implement Vietnam’s National Green Growth Strategy.”
Participants at the conference included experts from the SBV, officials from commercial banks and financial institutions, line ministries, cities and provinces that have implemented green activities to some extent, and experts from international organizations and key green GIZ programs. It was an opportunity for them to discuss the current status of and perspectives on international green funding sources and on the financial needs for green growth in Vietnam.
Participants were also informed by representatives from the central bank on the very first important results that lay the foundation for the whole process of developing a framework for green finance - green banking policies and products, including pilot green credit programs, a green project catalogue, social and environmental risk management guidelines, and green credit reporting regulations.
These are the initial outcomes achieved by SBV in cooperation with development partners, an active and effective contribution of which is from the Macroeconomic Reforms/Green Growth Programme.
HSBC Vietnam launches Touch ID for corporate clients
HSBC Bank (Vietnam) Ltd. (HSBC Vietnam) has officially launched Touch ID, a fingerprint recognition technology enabling corporate clients to easily and securely access their accounts to view account balances and recent transactions with the HSBCnet Mobile app.
Using fingerprint recognition instead of a password, it is intuitive and easy to set up, in addition to ensuring the digital banking is at its most secure. HSBC is one of the first banks in Việt Nam to offer this technology for its corporate customers.
Nguyễn Thị Mỹ Hạnh, head of Global Liquidity and Cash Management of HSBC Vietnam said, “At HSBC, we understand that our fast-moving clients require banking to be simpler, faster and safer. In 2015, we pledged to invest US$2.1 billion into digital transformation by 2020 and we are on track to achieve that goal.
“In Việt Nam, introducing Touch ID to HSBCnet is the latest step we have taken to provide our customers a more seamless and secure banking experience in this digital age.”
The Touch ID log-on facility, compatible with Apple mobile devices, is currently available for corporate clients of HSBC in Việt Nam. The function will allow clients to view account balances and recent transactions with greater convenience and safety, wherever they are in the world.
The launch of HSBC Vietnam’s Touch ID feature is also in line with the State Bank of Việt Nam’s call for financial service providers to apply the most advanced security technologies to customers.
HSBC’s introduction of Touch ID is part of the company’s long term digital development strategy. In late March, HSBC Việt Nam signed a cooperation agreement with Việt Nam’s Customers Department to launch e-customer payments that allow HSBC customers to experience a more convenient customs payments process online. This follows a partnership with the Department of Taxation to launch an online tax payment platform in December 2015.