Free trade advantages for Vietnam, RoK firms

RoK Ambassador in Vietnam Park Suk-hwan has urged businesses of
both countries to take advantage of preferences from the ASEAN-Korea
Free Trade Agreement (AKFTA).

He stressed the important role of
AKFTA in expanding trade and economic cooperation between Vietnam and
the Republic of Korea (RoK) at a workshop on improvement of the
effective use of the agreement for goods from ASEAN countries and
Vietnam in Hanoi on October 4.

Bilateral trade and economic cooperation have grown rapidly and become a fine example for the world, the diplomat said.

Trade
between Vietnam and the RoK reached 10 billion USD in 2009, an
increase of 20 times against 1992 – when the two countries established
diplomatic ties – and is expected to reach 20 billion USD by 2015.

Deputy
Minister of Industry and Trade Nguyen Thanh Bien said that
implementation of AKFTA had contributed to increased Vietnam
exports.

In 2009, Vietnam earned 1.66 billion USD from export
of goods given preferences from the regional agreement, accounting for
80 percent of the country’s total exports to the RoK.

In the
first six months of this years, thanks to certificates of preferential
origin, businesses shipped goods worth 842 million USD, accounting for
almost 65 percent of Vietnam ’s exports to the RoK.

Deputy
Minister Bien said the workshop offered an opportunity for experts and
policy makers to present information about preferences and the
agreement’s implementation to Vietnamese firms.

However,
the Ministry warned that businesses needed to actively study and inquire
into markets and preferences in order to tap the preferences in the
agreement and strengthen ASEAN links./.

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RoK tops investor list in Vietnam

The Republic of Korea (RoK) is the largest source of foreign
investment in Vietnam , with an accumulated capital infusion of 23
billion USD, said the RoK Consul General in HCM City Kim Sang Yoon.

At the Oct. 4 meeting held by the HCM Union of Friendship Organisations
to celebrate the founding anniversary of the RoK (Oct. 3), Consul
General Kim Sang Yoon said the cooperative relations between Vietnam and
the RoK have strongly developed since the two countries established
their diplomatic ties 18 years ago, with two-way trade turnover
increasing from 500 million USD in 1992 to 9.5 billion USD.

At the meeting, Chairman of the HCM City Vietnam-RoK Friendship
Association Vu Van Hoa thanked the RoK for its support to Vietnam -
and HCM City in particular - during the national construction and
development.

In 2009, Vietnam received 985
million USD in aid from the RoK Economic Development Cooperation Fund or
20 percent of the fund’s budget, Hoa said.

The RoK
has also provided non-refundable aid to help Vietnam develop
infrastructure systems, health care and environmental programs, he said.

In recent years, cooperation in tourism, education, sports and culture has borne fruit.

About 59,000 Vietnamese people are working and studying in the RoK and
tens of thousands of Vietnamese brides have married RoK men, while many
thousands of RoK families are living in Vietnam , according to the
Vietnam-RoK Friendship Association.

Up to July of this year, the RoK provided the second largest number of tourists to Vietnam , with 368,000 arrivals./.

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Coffee prices to be stable in 2010-11 crop

Experts have predicted little changes in the prices of Vietnamese coffee
in the 2010-2011crop, with prices between 24,000-29,000 VND per kg.

By the end of September, 2010, coffee growers in the Central Highlands
of Tay Nguyen, Vietnam ’s largest coffee-growing area, sold their
beans harvested in the 2009-2010 crop for 31,000 VND a kilo - the
highest price recorded in the past two years.

According to the
Vietnam Coffee and Cacao Association (Vicofa), although output of a
large coffee-growing area in Vietnam, which is currently the world’s
second largest coffee exporter, is likely to be affected by dry October
weather and ageing, the International Coffee Organisation (ICO) has
forecast that the world’s coffee output in the 2010-2011 crop is likely
to reach 133 million 60-kg bags, a rise of 7 million bags compared with
the 2009-2010 crop.

In the past nine months, Vietnam shipped
abroad 925,000 tonnes of coffee beans for 1.32 billion USD, which
represented rises of 4.2 percent and 0.9 percent in terms of volume and
value year on year.

Vietnam’s largest coffee market is Germany, accounting for 13.5 percent of total export volume, followed by the
US, which takes 12.7 percent of Vietnam’s coffee exports./.

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Province cuts red tape for investors

Photo: Reuters

Binh Duong province has made every effort to improve its infrastructure and administrative formalities so as to attract more foreign investors, said chairman of the provincial People's Committee, Nguyen Hoang Son.

The province had also taken advantage of its geography and offered incentives to lure foreign invested projects.

The province attracted more than 846 foreign invested projects with registered capital reaching US$7.3 billion between 2005 and 2010, bringing the total number of projects in the province to date to 1,966 capitalised at $13.5 billion, said Son.

Investors include Korean tyre manufacturer Kumho Asian Group, with a total investment capital of $360 million and Thailand 's Siam Cement Group, which specialises in producing packages, with a total investment capital of $140 million. Malaysian property developer SP Setia Berhad Group invested $620 million in the My Phuoc eco-urban project and a $60 million beverage factory was financed by Japan 's Kirin Acecook Vietnam .

The strong attraction for foreign invested projects was a positive sign, as it made a very important contribution to the province's economic development and generated high industrial value, said director of the Department of Planning and Development Huynh Van Trai.

Local authorities have worked with vocational schools to train skilled workers to meet the greater labour demands that come with more foreign invested projects.

Paik In Ki, chairman of the Republic of Korea ’s Financial Investment Association in Binh Duong, said foreign investos were pleased to invest in the province as they could see good infrastructure and good support from local authorities which helped investors to be successful. His company would continue to act as a bridge to provide other Korean businesses with a deep understanding of the province's investment climate and raise their investment in the province.

Binh Duong has developed 28 industrial parks covering 8,751ha.

Prominent projects in the province include the VND3.5 trillion (US$179.5 million) My Phuoc-Tan Van road, which is currently under construction. The road will be a major transportation route to international airports and seaports.

Kang Myong Jun, diretor of DJV Ltd Co, Automotive Manufacturing & Wholesales-Parts, Automotive Repair & Service, said apart from good infrastructure, other facilities such as accommodation and urban areas were also important for luring foreign investors.

 

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Garments continue topping list of exports

Posting an export turnover of 8 billion USD in the first nine months of
this year, garments continued taking the lead amongst export staples
since the beginning of 2009.

The export of garments
to the Republic of Korea saw the highest growth rate of 84 percent,
mainly thanks to a reduction in tariff in line with the ASEAN-RoK Free
Trade Agreement, while the export to the US , which accounts for 55
percent of the industry’s revenues, also grew by 20 percent.

In particular, garment exports to the European market have bounced
back in the past three months, at 7 percent, following a long period of
dropping.

Vice Chairman of the Vietnam Garments and
Apparel Association (Vitas) Le Van Dao said a number of domestic garment
companies have received orders for the first half of 2011, plus prices
have risen by 10-15 percent year-on-year.

A
representative of the Ho Chi Minh City-based Viet Hung Garment Joint
Stock Company said the business has recently signed contracts to export
1.2 million items to Japan in early 2011.

Vietnam ’s garment firms will also have the opportunity to boost
exports and investments to Laos and Cambodia as the European Union
(EU) has decided to grant references in terms of material origin to the
two nations.

With these advantages, Dao said the
industry is likely to reach the yearly target of 10.5 billion USD in
export turnover right in November.

To achieve
sustainable development, garment businesses have also paid due attention
to the domestic market by participating in programmes which are
designed to encourage local consumers to use Vietnamese goods and bring
Vietnamese goods to rural areas.

Many supermarkets
under the Vietnam Garment and Textile Group have embarked on plans to
expand foothold in the domestic market in an effort to record a retail
sale growth rate of between 17-20 percent in 2010./.

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Footwear industry submits strategy

The Vietnam Leather and Footwear Association (Lefaso) has submitted to
the Government a strategy to develop the sector from now till 2020 with a
vision to 2015 which focuses on the support and material industries.

Lefaso President Nguyen Duc Thuan said the strategy
aims at ending the sector's dependence on foreign materials and
technologies, and shifting from sub-contracting to direct contracting.

Under the strategy, the sector will need 18.8
trillion VND (989 million USD) to produce shoe trees and footwear
models, and expand the production of materials including leather and
leatherette.

The plan is expected to help the sector
earn 8.5 billion USD from exports by 2015 and 11 billion USD by 2020 by
boosting the localisation rate to 65-75 percent from the current 50
percent.

Thuan explained that the strategy was
developed because the sector has been suffering from a serious shortage
of materials for many years due to the lack of a support industry.

The country currently has only 30 enterprises, including five with
foreign investment capital, producing tanned leather, the main material
used by the footwear sector. These enterprises can only meet 30 percent
of the material demands of domestic footwear enterprises.

Thuan further explained that the sector has to cope with the EU's anti-dumping tax on Vietnamese footwear.

In an effort to boost exports, Lefaso has carried out many promotional
activities, including hosting the 29th international conference of the
Asian footwear sector, and the international fair for footwear materials
and machines

As customers are shifting their
attention from China to Vietnam , Vietnamese shoe makers currently
have export orders until the first quarter of 2011.

In the first nine months of the year, the sector earned over 3.6
billion USD from exports, a year-on-year increase of 23 percent. The
figure is expected to surpass 5 billion USD by the end of the year./.

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Air Mekong wraps up test flights, ready to take off

Air Mekong, Vietnam’s third private airline, has safely concluded test flights to several domestic destinations, qualifying for a license to become operational this week, the Civil Aviation Administration of Vietnam said.

The CAAV will hand over an Air Operator's Certificate this week, enabling the carrier to begin its first flight Saturday, Vo Huy Cuong, director of the regulator’s Air Transport Department, said.

It will initially operate three daily flights between Hanoi and Ho Chi Minh City before launching services to the Central Highlands cities of Pleiku and Buon Ma Thuot, Phu Quoc, and Con Dao.

The carrier has taken delivery of four Canadian-made 90-seat Bombardier CRJ-900 aircraft leased from the US’ SkyWest Leasing Inc for three years.

The company, which owns SkyWest Airlines, is looking to acquire a 30 percent stake in the carrier.

Air Mekong is the third private operator to be licensed after Vietjet Air and Indochina Airlines, and has a chartered capital of VND200 billion (US$10.5 million), the minimum required under the law.

Indochina Airlines, the first operational private carrier, had its traffic rights revoked earlier this year after it repeatedly failed to fulfill its commitment to fly again or prove its financial capability.

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