Charm Engineering to build huge complex in Binh Duong

Jeon Yong Ho, marketing director of Charm Engineering Co., Ltd introduces the Charm Plaza property project seen in the background on Thursday - Photo: Quoc Hung

HCMC – South Korea’s Charm Engineering on Thursday announced to choose Posco E&C as the contractor to build phase 1 of its Charm Plaza project as a mix-use property complex in the southern province of Binh Duong.

The Charm Plaza project will be an apartment complex comprising of six 25-floor blocks with about 2,700 units plus supermarkets, said the company, which is more known as a manufacturer of LCD equipment and semi-conductors. The sprawling complex, covering five hectares at Song Than area in Di An District, will have total floor space of 363,000 square meters.

This project is a big-scale one comparable to major urban development projects not only in Binh Duong Province but also in HCMC, said Jeon Yong Ho, marketing director of Charm Engineering Co., Ltd at a press meeting.

The US$200-million project will set up model houses next month for introduction to customers, he said, adding sales marketing for the project would start soon. “We are planning to carry out marketing activities right from October 2010.”

On the other hand, the company is also running a pre-sale campaign, and many people in surrounding areas of the project in Binh Duong have made phone calls asking for information about the project, he said.

Apartments at Charm Plaza vary from 50 to 115 square meters in size, and the company plans to set up a reasonable selling price range from US$800 to US$1,000 per square meter.

Ho added that by providing amenities such as swimming pools like the standard for resorts, Charm Plaza has created a difference from other apartments. In addition, when the second phase of this project is in place, Charm Plaza will attract supermarket operators to invest in Binh Duong.

By choosing Posco E&C as the contractor, Charm Engineering is expecting to achieve positive results in selling apartments in the future, he said. The contractor Posco has established its reputation in Vietnam via building the Diamond Plaza in the center of HCMC.

Starting its investment in Vietnam since 2007, Charm Engineering has seven real estate projects with combined investment capital of more than US$890 million.

Ho said Charm Engineering would continue other projects including Toc Tien new town in Ba Ria-Vung Tau Province covering more than 183 hectares; a five-star resort hotel in Chi Linh area in Vung Tau City over 10.5 hectares; a serviced apartment building in Binh Thanh District, HCMC and another apartment project with 500 units in Thu Dau Mot Town, Binh Duong. 

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Vietnam probably won’t devalue again in 2010, ANZ says

Vietnam probably won’t devalue the dong again until next year, Australia & New Zealand Banking Group Ltd. predicted, after three moves by the nation’s central bank to reduce the value of the currency in the past year.

The dong was devalued in August, when the reference rate for the currency was weakened by 2 percent to 18,932 per dollar, following such moves in February and in November 2009.

Vietnam faces an “embedded expectation” of a weakening dong, Benedict Bingham, the International Monetary Fund’s Hanoi representative, has said. Recent wage increases in China as well as a stronger Chinese currency should underpin the dong for the rest of 2010 by making investment in Vietnam more attractive, Tamara Henderson, the Singapore-based head of Asia foreign- exchange research at ANZ, wrote in an Oct. 1 note.

“They have a little breathing space, particularly given that they recently devalued,” Henderson said by phone today.

Vietnam may win more foreign investment and experience a pickup in exports following China’s June 19 pledge to allow the yuan to trade more freely, PXP Vietnam Asset Management said at the time. The Chinese yuan has strengthened 2.1 percent against the dollar since then, while the dong has weakened 2.6 percent.

Exports climb

Vietnam’s exports increased 23 percent from a year earlier in the nine months through September, according to preliminary figures released on Sept. 27 by the General Statistics Office in Hanoi. That marks an acceleration from the 16 percent growth reported for the first half of 2010.

“Lower inflation and improved competitiveness should keep devaluation pressures at bay into year-end,” Henderson wrote.

The dong will probably be devalued again in the first half of 2011, she wrote, predicting that the currency will move to about 20,000 per dollar and citing Vietnam’s “ballooning” trade deficit as contributing to the dong’s weakening trend.

“Sizable” trade deficits have contributed to putting “downward pressure” on the dong, the Asian Development Bank said last week.

Vietnam’s cumulative trade deficit in the nine months through September reached $8.58 billion, according to the General Statistics Office. For September alone, the gap widened to $1.05 billion from $395 million in August.

‘Structural’ deficit

The trade gap “needs to come down,” Robert Prior- Wandesforde, a Singapore-based economist at Credit Suisse Group AG, wrote in a note dated Sept. 29. “The deficit partly reflects strong imports of capital goods, but also a penchant for consumer products.”

Vietnam’s trade deficit is “structural,” with exports largely consisting of lower value-added items such as commodities, footwear and garments while imports are primarily industrial machinery needed to build the country’s manufacturing base, Deutsche Asset Management (Asia) Ltd., which manages DWS Vietnam Fund Ltd., said on Sept. 27.

“It is common practice for emerging-market economies to devalue their currency to maintain competitiveness while running a trade deficit as they acquire capital for industry,” Deutsche Asset Management (Asia) said in a monthly note. “A currency equilibrium point will be reached as the economy matures.”

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Vietnam’s banks asked to lower deposit rates to 11 pct

The Vietnam Banks Association has asked members to reduce deposit rates to no more than 11 percent by Oct. 15 from 11.2 percent, according to a statement on the central bank’s website.

For non-term deposits and deposits of less than three months, the association asked commercial banks to make a bigger reduction to create a “suitable” interest-rate curve to attract long-term funds, according to the statement. Members were also asked to lower dollar-deposit rates and to cut borrowing costs to spur lending, according to the statement.

The Southeast Asian nation’s government has been asking commercial banks to increase lending to support the economy and meet a target for 25 percent credit growth this year. The State Bank of Vietnam on Sept. 28 allowed lenders to use 25 percent of non-term deposits made by businesses for loans. Bank credit has grown 19.27 percent from the start of the year to Sept. 27.

Vietnam’s gross domestic product may expand 6.7 percent this year, surpassing a target of 6.5 percent, Nguyen Xuan Phuc, chairman of the Government Office said Sept. 30. The government in May asked the State Bank of Vietnam to lower deposit rates to 10 percent and cut borrowing costs to 12 percent to spur economic growth.

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Vietnam’s banks asked to lower deposit rates to 11 pct

The Vietnam Banks Association has asked members to reduce deposit rates to no more than 11 percent by Oct. 15 from 11.2 percent, according to a statement on the central bank’s website.

For non-term deposits and deposits of less than three months, the association asked commercial banks to make a bigger reduction to create a “suitable” interest-rate curve to attract long-term funds, according to the statement. Members were also asked to lower dollar-deposit rates and to cut borrowing costs to spur lending, according to the statement.

The Southeast Asian nation’s government has been asking commercial banks to increase lending to support the economy and meet a target for 25 percent credit growth this year. The State Bank of Vietnam on Sept. 28 allowed lenders to use 25 percent of non-term deposits made by businesses for loans. Bank credit has grown 19.27 percent from the start of the year to Sept. 27.

Vietnam’s gross domestic product may expand 6.7 percent this year, surpassing a target of 6.5 percent, Nguyen Xuan Phuc, chairman of the Government Office said Sept. 30. The government in May asked the State Bank of Vietnam to lower deposit rates to 10 percent and cut borrowing costs to 12 percent to spur economic growth.

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Vietnamese bank tempts savers with German beer

A small Vietnamese bank has started giving away beer to customers who make deposits, the latest in a string of gimmicks deployed by lenders in the Southeast Asian country to attract savers.

Western Bank launched the nationwide promotion on Wednesday, offering a large can of Bitburger beer imported from Germany for each one-month deposit of at least 7.5 million dong ($385) made until November 25.

"We started this award before Tet, as every other bank has its own promotion," said a teller at the bank, which is based in the Mekong Delta city of Can Tho.

In the run-up to Tet, Vietnam's Lunar New Year festival, which usually falls in February, cash demand rises as companies pay year-end bonuses and consumers splash out.

Tropical Vietnam has a long tradition of beer drinking, introduced by French colonists in the late 19th century. Although local brews dominate the market, rising living standards have allowed city dwellers to taste foreign brands.

Authorities have been trying for months to get banks to cut interest rates, both on loans and deposits, so lenders have had to get creative in the fight for depositors.

Inducements have ranged from a tour of Europe to cars, crash helmets, bed sheets and blood pressure monitors.

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Vietnam grants new gold import licenses, quotas

Vietnam's central bank granted permits for gold imports to several firms on Thursday, giving each a quota of 200-300 kg in a bid to narrow the spread between gold prices in the country and in world markets.

The licenses were issued on Thursday afternoon and are valid through Oct. 12, according to a report on Vneconomy.vn, the online version of the Vietnam Economic Times.

Vietnam effectively banned gold imports in mid-2008 to help tackle a trade deficit as the economy overheated, but the central bank has granted import quotas on a selective basis since then.

A source with direct knowledge of the licensing and quotas said nine firms were part of the arrangement, which would put the total volume somewhere between 1.8 and 2.7 tonnes.

There was no immediate comment from the State Bank of Vietnam, which earlier published an interview on its website quoting a senior official as saying the central bank would consider granting new licenses if the price on the domestic market rose "unreasonably high."

Spot gold, which has risen some 8 percent over the past month, hit an all-time high for a third straight session on Thursday, rising above $1,360 an ounce, as a weak dollar pushed investors into bullion in the face of economic uncertainty and speculation of further monetary easing by central banks.

The import licenses were the first granted by the State Bank of Vietnam since February, and came in reaction to a widening spread between onshore prices and those on world markets.

Although the volume is limited it will have "a positive psychological effect" on the market, Vneconomy quoted Nguyen Thi Cuc, deputy director of importer Phu Nhuan Jewelry Co, as saying.

In Vietnam, gold in Hanoi had eased to VND32.77/32.85 million per tael by Thursday evening after rising as high as VND33.07/33.15 million earlier, according to Saigon Jewelry Co Ltd, the country's top dealer. One tael equals 1.21 troy ounces.

The unofficial exchange rate was quoted earlier at around VND19,800/19,850 per dollar at a major Hanoi gold shop , putting the gold price in Vietnam at a premium then of about $20 to global prices.

Markets will be tight

Earlier, the central bank's website quoted Nguyen Quang Huy, director of the foreign exchange department of the State Bank of Vietnam, as saying new imports might be permitted "at appropriate volumes and times, to stabilize the market".

Dealers in Asia said the Vietnamese comments helped nudge the price of gold up on the international market.

"People are going to focus on the fact that the Asian physical market will be tight. Last time Vietnam opened the door to gold imports, gold went up $20. In percentage terms, it could translate into $30 today," said a Singapore-based trader after

Foreign exchange dealers have said the rise in global gold prices, and curbs on imports, had fed smuggling. Demand for dollars to buy this gold overseas was pushing down the value of the dong.

A similar scenario unfolded a year ago, leading the authorities to issue gold import licenses then, too. The pressure on the dong continued, however, and the central bank devalued the currency and raised interest rates just weeks after relaxing the import ban.

Traders said gold was being smuggled into Vietnam from neighboring countries and Thailand.

Nguyen The Hung, chief executive officer of Vietnam Gold Corp, said domestic supply was limited as investors had sold and businesses had increased gold exports when prices hit VND29-30 million per tael.

Speaking before the new licenses were announced, he said the differential between domestic and world gold prices had to be addressed. "The gap requires measures from the central bank."

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Vietnam grants new gold import licenses, quotas

Vietnam's central bank granted permits for gold imports to several firms on Thursday, giving each a quota of 200-300 kg in a bid to narrow the spread between gold prices in the country and in world markets.

The licenses were issued on Thursday afternoon and are valid through Oct. 12, according to a report on Vneconomy.vn, the online version of the Vietnam Economic Times.

Vietnam effectively banned gold imports in mid-2008 to help tackle a trade deficit as the economy overheated, but the central bank has granted import quotas on a selective basis since then.

A source with direct knowledge of the licensing and quotas said nine firms were part of the arrangement, which would put the total volume somewhere between 1.8 and 2.7 tonnes.

There was no immediate comment from the State Bank of Vietnam, which earlier published an interview on its website quoting a senior official as saying the central bank would consider granting new licenses if the price on the domestic market rose "unreasonably high."

Spot gold, which has risen some 8 percent over the past month, hit an all-time high for a third straight session on Thursday, rising above $1,360 an ounce, as a weak dollar pushed investors into bullion in the face of economic uncertainty and speculation of further monetary easing by central banks.

The import licenses were the first granted by the State Bank of Vietnam since February, and came in reaction to a widening spread between onshore prices and those on world markets.

Although the volume is limited it will have "a positive psychological effect" on the market, Vneconomy quoted Nguyen Thi Cuc, deputy director of importer Phu Nhuan Jewelry Co, as saying.

In Vietnam, gold in Hanoi had eased to VND32.77/32.85 million per tael by Thursday evening after rising as high as VND33.07/33.15 million earlier, according to Saigon Jewelry Co Ltd, the country's top dealer. One tael equals 1.21 troy ounces.

The unofficial exchange rate was quoted earlier at around VND19,800/19,850 per dollar at a major Hanoi gold shop , putting the gold price in Vietnam at a premium then of about $20 to global prices.

Markets will be tight

Earlier, the central bank's website quoted Nguyen Quang Huy, director of the foreign exchange department of the State Bank of Vietnam, as saying new imports might be permitted "at appropriate volumes and times, to stabilize the market".

Dealers in Asia said the Vietnamese comments helped nudge the price of gold up on the international market.

"People are going to focus on the fact that the Asian physical market will be tight. Last time Vietnam opened the door to gold imports, gold went up $20. In percentage terms, it could translate into $30 today," said a Singapore-based trader after

Foreign exchange dealers have said the rise in global gold prices, and curbs on imports, had fed smuggling. Demand for dollars to buy this gold overseas was pushing down the value of the dong.

A similar scenario unfolded a year ago, leading the authorities to issue gold import licenses then, too. The pressure on the dong continued, however, and the central bank devalued the currency and raised interest rates just weeks after relaxing the import ban.

Traders said gold was being smuggled into Vietnam from neighboring countries and Thailand.

Nguyen The Hung, chief executive officer of Vietnam Gold Corp, said domestic supply was limited as investors had sold and businesses had increased gold exports when prices hit VND29-30 million per tael.

Speaking before the new licenses were announced, he said the differential between domestic and world gold prices had to be addressed. "The gap requires measures from the central bank."

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