Singapore firm set to ease north’s logistics woes

An artist's impression of Mapletree Bac Ninh Logistics Park

Photo: Photo courtesy of Mapletree

The Singapore-based Mapletree Investment will break ground for northern Vietnam's largest logistics center next week to serve the increasing needs of international and domestic manufacturers who are setting up bases there.

The $70 million center will be located at the Vietnam-Singapore Township and Industrial Park in Bac Ninh Province, 18 kilometers northeast of Hanoi.

The 55-hectare park will have bonded and non-bonded warehouse facilities and an inland container depot. When completed, it will have 280,000 square meters of modern logistics space.

Its construction begins at a time when many foreign investors like Canon, Panasonic, Samsung Electronics, Foxconn, Compal, and Piaggio, who have manufacturing factories in northern Vietnam, are facing a shortage of logistics facilities.

"There are several logistics sites developed in Bac Ninh and neighboring provinces, but all are small," Dau Tu (Vietnam Investment Review) newspaper quoted Vu Duc Quyet, director of the Bac Ninh Industrial Parks Management Authority, as saying.

With more and more manufacturers setting up shop in the region, the existing logistics facilities are overstretched, he said.

Korea's Samsung Electronics, which has a $670 million mobile phone manufacturing plant in Bac Ninh, recently sought permission to build its own logistics site.

Mapletree's site is close to major roads like National Highways 1A and 18 and the Hanoi-Hai Phong Highway, and near the border with China.

"Manufacturers can easily transport their cargo from the center to the capital, Noi Bai International Airport [in Hanoi], and ports in Hai Phong," Quyet added.

This is Mapletree's first project in the northern region and third in Vietnam after the 68-hectare, $110 million Mapletree Binh Duong Logistics Park and Mapletree Business City @ Binh Duong in Binh Duong Province near Ho Chi Minh City.

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Latest technology, market info top priority for firms

by Mi Bong

HCM CITY — The ability to access market information and advanced technology were the two major factors affecting the business community in the second quarter of the year, according to Viet Nam Business Insight Survey.

At a seminar held yesterday in HCM City by the Viet Nam Chamber of Commerce and Industry, Pham Thi Thu Hang, head of the Business Development Institute, said the survey had received 374 responses from domestic enterprises.

Government investment in information and technology had helped further the use of advanced technology, they said.

Domestic and foreign market demand ranked second and third, respectively.

Some other influences included production costs, loan access, skilled human resources, infrastructure conditions such as water, electricity and wastewater treatment systems, transport infrastructure, land issues and site clearance.

The survey discovered that 65 per cent of businesses must borrow a short-term loan with an annual interest rate of 12-13 per cent and upwards.

Most of them said the interest rate was too high and would affect their investment plans.

The businesses said the interest rate should be adjusted to below 12 per cent to create favourable conditions to their production and business.

They expected there would be positive changes related to macroeconomic policies, loan access conditions and infrastructure improvement.

Vo Tan Thanh, director of the VCCI's HCM City branch, said the Viet Nam Business Insight Survey aimed to investigate and collect concerns and feedback from the business community through online fora.

It targets documenting the state of economy, industry and business environment in a timely and accurate manner.

The VBiS will also provide the Government as well as firms and executives with a precise and comprehensive insight into Vietnamese enterprise development and feedback on policy.

It was launched by the VCCI, the Asia Competitiveness Institute and the General Statistics Office under the sponsorship of the Asia Foundation.

At the seminar, Vu Van De, head of HCM City Statistics Department's Statistics-Industry Sub-Department, said industrial production growth in the first eight months of this year had increased 8.8 per cent over the same period last year.

The water and electricity distribution as well as production industry had the highest growth rate, 15.4 per cent, in the period.

The manufacturing and processing industry accounts for the highest, 60.1 per cent of total industrial production value, an increase of 11.6 per cent.

Challenges

Although industrial production has overcome the financial crisis period and seen a growth, it has faced challenges.

By early August, because of a drop in exports, the warehousing of manufacturing and processing products was fairly high, with an increase of 137.5 per cent over the same period last year, while consumption reached 112 per cent.

Power shortages in the first and second quarters affected the economy greatly.

Technical and trade barriers have made exports slow and unstable, causing a back-up of stored goods in the manufacturing and processing industry, according to the report. — VNS

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VN-Russia economic forum held in Moscow

MOSCOW — Almost 400 businesses attended a Viet Nam-Russia economic forum entitled "Strategic partnership – comprehensive co-operation" in Moscow on Wednesday.

Addressing the opening ceremony, Vice President of the Chamber of Commerce and Industry of the Russian Federation George Petrov said Russia and Viet Nam had combined actions based on a fine traditional friendship, mutual trust and understanding, active political dialogue and co-operation for mutual interest.

Two-way trade value recorded a year-on-year increase of 8.2 per cent to more than US$1.5 billion in 2009 despite the global economic crisis and reached $924 million in the first half of this year, he said.

Viet Nam now had 59 Russian-invested projects totalling more than $576 million, excluding those in the oil and gas industry, he added.

However, Petrov noted, the two countries had yet to bring into play the full potential of the bilateral relationship.

He suggested businesses from the two countries increase contacts, exchange market information and further co-ordinate with each other to gain access to other regional markets.

He expressed his hope that both countries would sign a number of co-operation agreements to further promote the strategic partnership and comprehensive co-operation during Russian President Dmitry Medvedev's upcoming visit to Viet Nam. Petrov also called on Vietnamese businesses to invest in and co-operate with Russia's Far East and Sibir regions.

Vice President of the Viet Nam Chamber of Commerce and Industry (VCCI) Pham Gia Tuc took the opportunity to introduce almost 100 Vietnamese businesses participating in the Viet Nam Days in Russia Expo and the VCCI's business promotion and connectivity activities.

For his part, Minister of Industry and Trade Vu Huy Hoang spoke of the advantages of Viet Nam's business and investment environment, saying that the nation was an active developing market which is safe, stable and deeply integrated in the global economy.

Viet Nam's policy on foreign-invested businesses considered them as one of its own and created favourable conditions for investors, he confirmed.

He called on overseas Vietnamese businesspeople in Russia to invest directly or through joint ventures in their home country.

A seminar on the establishment of representative offices for Vietnamese businesses in Russia and a meeting between businesses from the two countries took place within the framework of the forum. — VNS

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Tra tariff opposed by group

HA NOI — Viet Nam Association of Seafood Exporters and Producers yesterday expressed indignation over the US Department of Commerce's preliminary anti-dumping tariffs on Vietnamese tra frozen fillets.

In the sixth administrative review applied for certain Vietnamese tra frozen fillet exports, the department determined to tax duty rates in excess of 100 per cent, far exceeding any prior results in the case which has lasted more than eight years.

In previous department anti-dumping reviews, most Vietnamese exporters enjoyed the lowest tariff of 0.52 per cent.

The association also opposed the department's "unjustified" change in the surrogate country used to value raw material inputs, suddenly switching from Bangladesh to the Philippines, after consistently rejecting the Philippines in all prior administrative reviews.

The association said using Philippines data as the benchmark was not appropriate because Viet Nam was the biggest tra producer and exporter in the world with 1.2 million tonnes a year, while the Philippines' tra industry was still fledging and small with undeveloped farming and processing which would raise the price.

"This decision will negatively affect the livelihoods of millions of tra farmers in Viet Nam, as well as US consumers and workers related to tra import activities," the association said. It said the determination violated the letter and spirit of free-trade agreements between the US and Viet Nam, and asked the department to review the rates in the final determination which would be released in six months. — VNS

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Industry sector seeks energy-saving solutions

The industry sector is banking on an international exposition opened in Ho Chi Minh City to gain know-how on energy savings strategies from 250 exhibiting companies representing 30 countries and territories.

For example, exhibitor Company 21 Power Corp was committed to providing energy management solutions for stable and sustainable supply of electricity.

Tech United Pte Ltd. offers lighting energy-saving solutions, LED, and quality designs. CE Globaltest Pte Ltd. showcases electric and electronic measuring and testing equipment which is highly efficient and friendly to the environment.

As part of the event, a workshop on “Sustainable and competitive solutions for a developing economy” will be held.

The workshop aims to provide industrial experts and managers with clean and efficient solutions to improve construction quality and energy efficiency. Its contents are expected to update audiences on recent rapid changes in the industry sector and provide a forecast on the development of innovative solutions in the future.

Vice President of the Vietnam Chamber of Commerce and Industry Hoang Van Dung said the exhibition would provide opportunities for domestic and international enterprises to boost cooperation and business.

Daniel Cheung, Director of the Hong Kong Exhibition Service Company, pointed out a need for Vietnam to develop a sustainable power source and address issues related to an environment appealing to foreign investment in energy projects.

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Banks devise fees to shift ATM costs

Banks are planning to charge customers for account statements to reduce the cost of maintaining ATMs after the central bank rejected their request to charge fees for their use.

Forty banks had also asked the State Bank of Vietnam to increase the fees for customers using other banks' ATMs to VND5,500 from VND3,300 per transaction.

It was for the third time that banks petitioned for ATM charges since 2008.

Trinh Thuong Thuc, head of Vietcombank's card business in HCMC, said banks want the charge because they have failed to break even on cards for many years.

On the other hand, ATM installation and maintenance costs are very high, he said, with their monthly rentals alone ranging from VND3 million to VND10 million ($526).

The annual maintenance cost for a machine is VND500 million ($26,300) in addition to other expenses like telecom line lease and staff wages, he added.

On top of all this, banks with thousands of ATMs have to maintain more than VND500 billion ($26 million) in cash without receiving any interest to ensure each machine has at least VND500 million.

Vietcombank said it plans to collect various fees, including a fee of VND550 per transaction for printing account statements starting from year-end. However, it will not charge customers for balance inquiries.

Agribank began collecting VND550 for printing statements from March 31.

Banks claimed the fees will help them set up ATMs in remote areas and upgrade existing machines.

By the end of June there were 10,516 ATMs in the country, nearly 800 more than at the end of 2009, according to the Vietnam Bank Card Association.

There were more than 23.3 million card users, an increase of more than 3 million.

The association said many banks simply choose to foot the bill for customers using other banks' ATMs instead of paying to install their own ATMs which cost $20,000 on average.

 

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Vietnam, RoK cooperate in industrial design

The Trade Promotion Department under the Ministry of Industry and Trade (MoIT) will cooperate with the Republic of Korea (RoK) Institute of Design Promotion (RoK IDP) in the field of industrial design.

Under a memorandum of understanding (MoU) signed in Hanoi this week, the two sides will share experience and the latest information regarding industrial design, cooperate in holding seminars and fairs as well as assist enterprises in human resource training.

Addressing the signing ceremony, Director of the RoK IDP Hyuntae Kim said the MoU is seen as the first step for RoK, a powerhouse in the industrial design, to work out aid programmes for Vietnam .

Deputy Minister of Industry and Trade Nguyen Thanh Bien said the cooperation will open up opportunities for Vietnamese enterprises to glean experience from the RoK in order to accelerate the sector in their own country.

According to the MoIT, investment-trade relations between Vietnam and the RoK have developed well. In 2009, two-way trade turnover between the two countries reached US$9 billion despite the impacts of the global economic crisis. The figure is expected to climb to US$20 billion in 2015.

 

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