VietNam Business

Sunday, October 17, 2010

Ministry says trade deficit uder check

HANOI – The Ministry of Industry and Trade is confident that the country’s target to keep trade deficit under 20% of the export value this year is well within reach given the strong export growth in the year to date.

Vu Van Chinh, head of the ministry’s Import-Export Department, told an online review meeting on Monday that “keeping trade deficit at less than 20% of the total export value this year is highly probable unless there occur sharp changes in the rest of the year.”

Export value in the January-August period increased by 19.7% year-on-year to US$44.85 billion, while import expenditure in the period totaled US$52.67 billion, leaving a trade deficit equivalent to 18.32% of export earnings, Chinh said.

Trade deficit stood at US$0.9 billion in August, which is the fourth straight month the deficit is kept below the bar, according to Chinh.

Therefore, “the trade deficit target is within reach if there are no upsurges in imports due to speculation on commodities,” he remarked.

Chinh predicted that exports would remain upbeat in the rest of the year, and the total export value for 2010 would likely hit US$68.5 billion if more efforts are made to keep monthly export revenue at US$5.9 billion. Import spending is estimated at US$80-82 billion.

However, Chinh also pointed out that challenges remained to be addressed, including the lack of materials for export processing in the fishery sector, the shortage of labor in the garment, footwear and furniture industries, and technical barriers in importing countries.

Call for FDI licensing rules to become tougher

The Foreign Investment Bureau (FIB) under the Ministry of Planning and
Investment was urged to keep a close eye on unqualified projects in
order to boost disbursement.

Participants at a
workshop in the southern province of Ba Ria-Vung Tau on September
7 asked the FIB to review the practice of disbursing foreign direct
investment (FDI) at the grassroots level in an effort to help local
administrations to speed up the process.

They called on the FIB to take firm measures against unqualified projects.

“Those projects which apply obsolete technology or have a negative
impact on the environment must not be granted licences for investment.
The FIB should also be determined in withdrawing land lots and licences
of those FDI projects which are slow in deployment,” the workshop heard.

Participants from the Association of FDI
Enterprises, planning departments and industrial zone management boards
in southern provinces and cities, also asked the FIB to withdraw land
areas left unused by some FDI projects to allow reallocation to other
projects.

The FIB forecast a further rebound of
the national economy during the rest of the year after a fast recovery
since early this year.

The first half of the year
witnessed 438 projects licensed for investment capitalised at 7.9
billion USD, representing an increase of 43 percent over 2009.

Up to July, 2010, a total of 11,759 FDI projects operated nationwide
with a combined investment of over 187 billion USD. Investors came from
91 countries and territories./.

Saturday, October 16, 2010

ADB offers loans for health, irrigation projects

The Asian Development Bank (ADB) will provide loans worth 160 million
USD and a grant of 11 million USD to expand Vietnam’s access to
quality health services and improve irrigation infrastructure.

Agreements to this effect were signed between ADB and the State Bank of Vietnam in Hanoi on September 7.

Of the total, a 60 million USD loan from ADB and the 11 million USD
non-refundable aid from the Government of Australia will finance the
Health Human Resources Sector Development Programme which deals with
obstacles in health service delivery, especially the management of human
and financial resources.

The programme will upgrade training
facilities, provide training for ethnic minority health workers and
facilitate the adoption of standard treatment and costing packages for
health services provided to the Vietnamese people.

Addressing
the ceremony, ADB representative Ayumi Konishi said that Vietnam
should accelerate and step up socially inclusive policy reforms to
address inequalities and improve delivery of social services as
improvements in health status - especially of the poor and ethnic
minorities - are critical to achieving the country’s development goals
of inclusive development.

Another 100 million USD loan was for the Strengthening Water Management and Irrigation Systems Rehabilitation Project.

The
project will repair the 50-year-old Bac Hung Hai irrigation and
drainage system in the northern provinces of Hung Yen, Hai Duong and
Hai Phong.

It will also construct a new training
centre for the Water Resources University which is expected to
be completed in June, 2016 and benefits 14,200 people./.

Vietnam tunes in to skyscraper trend

Vietnam tunes in to skyscraper trend Property developers in Vietnam are apparently locked in a race to build skyscrapers as a stronger economy allows them to pursue expensive projects with modern construction technology, experts say.

Deputy Chairman of the Vietnam Construction Federation, Pham Sy Liem, said the trend of building skyscrapers that began in the US has swept across many countries around the world.

“Developers in each country try to build record-breaking skyscrapers,” he said, adding that these projects help make the country more famous.

For instance, Cambodia last week announced that it plans to construct Asia’s tallest building with a US$200 million skyscraper 555 meters high.

The project is expected top the Taipei 101 Tower, the Shanghai World Financial Centre and Kuala Lumpur’s Petronas Towers, which are also the world’s three tallest buildings after the 828-meter Burj Khalifa in Dubai.

Experts said the development of high rise buildings in Vietnam began around ten years ago, mainly in the country’s two largest cities, Hanoi and Ho Chi Minh City.

The new trend only came out in full bloom over the past couple of years.

Nguyen Lan, former Chief Architect in Hanoi, said limited construction skills had prevented the country from latching on to this trend sooner.

Now that the economy has expanded and new construction technology can be applied, it is easier for Vietnam to build skyscrapers with growing height, he said.

PetroVietnam Construction JSC, a subsidiary of state-owned Vietnam Oil and Gas Group, announced in July that it will build the country’s tallest tower in Hanoi with an investment of more than US$1 billion.

The 528-meter tower is expected to be completed by 2014.

If the plan goes ahead, the PVN Tower will surpass the 336-meter Keangnam Hanoi Landmark Tower, which has been holding the title of Vietnam’s highest building since its construction started in 2007. Hanoi Landmark Tower is scheduled for completion next year.

Meanwhile, Ho Chi Minh City is going to have its own tallest building when the 262.5-meter Bitexco Financial Tower opens in October.

Liem of the Construction Federation said Vietnam is getting closer to being among the countries with the highest buildings in the world.

Local developers are competing over height as they know that a new height record will be a really good hook for their marketing campaign, Liem said. “A height advantage means developers will find it easier to attract customers, especially buyers of apartments.”

Architect Lan however warned that while skyscrapers do not take over a large area of land, they can further strain public infrastructure.

Each city should consider all aspects carefully before licensing skyscraper projects, he said.

Vietnam orders status report on large FDI projects

Vietnam orders status report on large FDI projects The Ministry of Planning and Investment has ordered foreign investors of projects with capital of more than US$1 billion to submit a progress report by next Thursday.

The status of real estate projects that cover more than 50 hectares of land as well as mining projects will also need to be reported, the ministry’s Foreign Investment Agency said.

The reports are expected to cover important issues concerning financing, labor and environmental impacts.

According to the agency, the ministerial order was necessitated by the slow pace of most major foreign-invested projects.

Among the 100 largest projects that have been registered, 16 have a capital of more than $1 billion.

Some provinces have taken strong action against delayed projects this year.

The central province of Quang Nam, for instance, in May canceled a $4.15 billion resort project as the investor had failed to complete the required investment formalities.

A $200 million real estate project invested by South Korea’s AJ Vietstar Co has also been revoked by the southern province of Ba Ria-Vung Tau due to lack of capital.

Foreign direct investment to Vietnam totaled $11.57 billion in the first eight months, down 12.3 percent from a year ago, according to official statistics.