ADB raises forecast on Vietnam’s economy

Ayumi Konishi, ADB country director for Vietnam, gestures while speaking to the press at the launch of the Asian Development Outlook 2010 Update (ADO Update) in Hanoi on Tuesday - Photo: TTXVN

HCMC – The Asian Development Bank raised its growth forecast for Vietnam’s economy in the Asian Development Outlook 2010 Update (ADO Update) launched on Tuesday.  

The report says Vietnam’s economic growth is expected to reach 6.7% this year, slightly higher than ADB’s earlier forecast, and for 2011 from 6.8% to 7.0% while lowering the inflation projection in 2010 to 8.5% and 2011 to 7.5%, respectively.  

“Since the last press conference on Asian Development Outlook 2010 in April this year, Vietnam has consolidated its macroeconomic stability, and as a result we are making upward adjustments in our growth forecast for both 2010 and 2011, while lowering the projections for inflation,”  Ayumi Konishi, ADB country director for Vietnam, said in a statement.  

The report notes the steps taken by the Government to stabilize economy have contributed to an improvement in the external and foreign reserves positions. With an improvement in the capital account, the overall balance of payments likely turned to a small surplus in the second quarter 2010 after recording deficits since the start of last year.

Economic growth quickened in the second quarter. Especially the two laws approved by the National Assembly in June 2010 – a new Law on the State Bank of Vietnam (SBV) and a Credit Institutions Law – together with various legal documents issued by SBV and other agencies, mark important progress in strengthening the framework for monetary policy implementation and safeguarding banking system stability.  

Vietnam, however, needs to be cautious in maintaining macroeconomic stability and effectively communicating such a policy stance to the public while accelerating reforms to prepare for the next ten-year period as a new Middle Income Country, according to the report.

“Vietnam should continue its efforts to ensure a better understanding of its policy stance by the public at large, supported by greater and timely availability of information and statistics. This applies not only to the Government but also to the corporate sector,” Konishi said.  

“In order to promote better corporate governance of both public and private enterprises, quality and timeliness of information to be made available to the owners or shareholders and potential future investors will be the key.”

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ADB raises forecast on Vietnam’s economy

Ayumi Konishi, ADB country director for Vietnam, gestures while speaking to the press at the launch of the Asian Development Outlook 2010 Update (ADO Update) in Hanoi on Tuesday - Photo: TTXVN

HCMC – The Asian Development Bank raised its growth forecast for Vietnam’s economy in the Asian Development Outlook 2010 Update (ADO Update) launched on Tuesday.  

The report says Vietnam’s economic growth is expected to reach 6.7% this year, slightly higher than ADB’s earlier forecast, and for 2011 from 6.8% to 7.0% while lowering the inflation projection in 2010 to 8.5% and 2011 to 7.5%, respectively.  

“Since the last press conference on Asian Development Outlook 2010 in April this year, Vietnam has consolidated its macroeconomic stability, and as a result we are making upward adjustments in our growth forecast for both 2010 and 2011, while lowering the projections for inflation,”  Ayumi Konishi, ADB country director for Vietnam, said in a statement.  

The report notes the steps taken by the Government to stabilize economy have contributed to an improvement in the external and foreign reserves positions. With an improvement in the capital account, the overall balance of payments likely turned to a small surplus in the second quarter 2010 after recording deficits since the start of last year.

Economic growth quickened in the second quarter. Especially the two laws approved by the National Assembly in June 2010 – a new Law on the State Bank of Vietnam (SBV) and a Credit Institutions Law – together with various legal documents issued by SBV and other agencies, mark important progress in strengthening the framework for monetary policy implementation and safeguarding banking system stability.  

Vietnam, however, needs to be cautious in maintaining macroeconomic stability and effectively communicating such a policy stance to the public while accelerating reforms to prepare for the next ten-year period as a new Middle Income Country, according to the report.

“Vietnam should continue its efforts to ensure a better understanding of its policy stance by the public at large, supported by greater and timely availability of information and statistics. This applies not only to the Government but also to the corporate sector,” Konishi said.  

“In order to promote better corporate governance of both public and private enterprises, quality and timeliness of information to be made available to the owners or shareholders and potential future investors will be the key.”

Related Articles

• ADB raises forecast on Vietnam’s economy
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VietABank to issue 137 million shares

Customers transact at a transaction office of VietABank. The bank will issue shares to increase capital to VND3 trillion - Photo: Le Toan

HCMC – Vietnam Asia Commercial Bank (VietABank) will issue nearly 137 million shares to increase its chartered capital from VND1.63 trillion to VND3 trillion to comply with the central bank’s regulations.

Under the plan approved by the State Bank of Vietnam, the bank will issue 9.58 million shares to pay 2009 dividend of 7% to existing shareholders, and sell 26.1 million to existing shareholders at VND10,000 each with the ratio of 100:16.

In addition, VietABank plans to sell over 100 million shares to local investors at the price not lower than VND10,000 each.

* HCMC Housing Development Bank (HDBank) has got approval from the State Securities Commission to issue 145 million shares to increase its chartered capital from VND1.55 trillion to VND3 trillion.

The bank will issue shares in two phases; 45 million shares in the first phase will be sold to existing shareholders at the face value, while 95 million shares will be sold to existing shareholders and the remaining five million shares to staff in the second phase at VND10,000 each.

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Spanish firms see Vietnam as good production base

Judith Padrós (L) of the Barcelona Chamber of Commerce talks to Vietnamese guests at a networking event held here on Monday evening for Spanish delegates and their local counterparts - Photo: Mong Binh

HCMC – Many Spanish companies are looking for the opportunity to invest in Vietnam as they consider this market as an attractive base for both production and consumption, said the Spanish economic and commercial counselor in Vietnam.

Alberto Cerdán told the Daily that executives of some 30 Spanish companies operating in various business fields would participate in a major investment forum planned here in November this year.

Cerdán released the news as Spain’s Barcelona Chamber of Commerce in association with the Segovia and Gijon chambers of commerce is organizing a mission to Vietnam, Laos and Cambodia to explore new business opportunities and expand their presence in those markets.

The visiting delegation groups Spanish firms in agricultural equipment, project and consultancy services, perfume and aroma, cosmetics, timber products and services, hospital equipment, and waste water treatment among others.

“We are here, not only to sell our products and services but also to look to partnerships with local partners,” Judith Padrós at the Barcelona Chamber of Commerce, told the Daily at a networking event held in HCMC on Monday.

Cerdán elaborated that some of the Spanish businesses coming to Vietnam in November had already built factories in China, and they wanted to invest in production facilities to take full advantage of lower labor cost in this country and to expand their operations in Asia.

He explained competition in Europe was turning tougher so Spanish companies would gain an advantage in that market if they were able to make products with competitive prices, and Vietnam had emerged as a haven for them.

He confirmed Spanish enterprises were keen to turn out garments and footwear in Vietnam for export to Europe and the United States as well as for consumption in this market.

“They start to think about Vietnam as a market for both production and consumption. For that they need their footing in the region,” he said.

In addition to garment, footwear and fish products, Vietnam will be able to attract Spanish investors in areas of logistics, building materials, food additives, farming and pharmaceutical, according to the Spanish counselor.

Spain is also involved in the fifth subway line to be developed in HCMC. Cerdán said Idom Ingenieria Consultoria S.A. and its local partners had almost completed the feasibility study for the subway development funded by Spain’s ODA loans.

The fifth subway line will stretch 15 kilometers from Can Giuoc Coach Station in District 8 to the Saigon Bridge and the 6-kilometer-long sixth line will connect Ba Queo in Tan Binh District and Phu Lam in District 6. An initial plan envisaged around US$900 million for developing the first route and US$320 million for the latter.

In December last year, high-ranking officials of Spain and Vietnam signed a memorandum of understanding under which the European country will provide up to 500 million euros (some US$674 million) for subway development in HCMC.

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Spanish firms see Vietnam as good production base

Judith Padrós (L) of the Barcelona Chamber of Commerce talks to Vietnamese guests at a networking event held here on Monday evening for Spanish delegates and their local counterparts - Photo: Mong Binh

HCMC – Many Spanish companies are looking for the opportunity to invest in Vietnam as they consider this market as an attractive base for both production and consumption, said the Spanish economic and commercial counselor in Vietnam.

Alberto Cerdán told the Daily that executives of some 30 Spanish companies operating in various business fields would participate in a major investment forum planned here in November this year.

Cerdán released the news as Spain’s Barcelona Chamber of Commerce in association with the Segovia and Gijon chambers of commerce is organizing a mission to Vietnam, Laos and Cambodia to explore new business opportunities and expand their presence in those markets.

The visiting delegation groups Spanish firms in agricultural equipment, project and consultancy services, perfume and aroma, cosmetics, timber products and services, hospital equipment, and waste water treatment among others.

“We are here, not only to sell our products and services but also to look to partnerships with local partners,” Judith Padrós at the Barcelona Chamber of Commerce, told the Daily at a networking event held in HCMC on Monday.

Cerdán elaborated that some of the Spanish businesses coming to Vietnam in November had already built factories in China, and they wanted to invest in production facilities to take full advantage of lower labor cost in this country and to expand their operations in Asia.

He explained competition in Europe was turning tougher so Spanish companies would gain an advantage in that market if they were able to make products with competitive prices, and Vietnam had emerged as a haven for them.

He confirmed Spanish enterprises were keen to turn out garments and footwear in Vietnam for export to Europe and the United States as well as for consumption in this market.

“They start to think about Vietnam as a market for both production and consumption. For that they need their footing in the region,” he said.

In addition to garment, footwear and fish products, Vietnam will be able to attract Spanish investors in areas of logistics, building materials, food additives, farming and pharmaceutical, according to the Spanish counselor.

Spain is also involved in the fifth subway line to be developed in HCMC. Cerdán said Idom Ingenieria Consultoria S.A. and its local partners had almost completed the feasibility study for the subway development funded by Spain’s ODA loans.

The fifth subway line will stretch 15 kilometers from Can Giuoc Coach Station in District 8 to the Saigon Bridge and the 6-kilometer-long sixth line will connect Ba Queo in Tan Binh District and Phu Lam in District 6. An initial plan envisaged around US$900 million for developing the first route and US$320 million for the latter.

In December last year, high-ranking officials of Spain and Vietnam signed a memorandum of understanding under which the European country will provide up to 500 million euros (some US$674 million) for subway development in HCMC.

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PPI gets land for residential development

An artist’s impression of Water Garden Apartment in HCMC’s Thu Duc District

HCMC - Local property developer Pacific Property and Infrastructure Development JSC (PPI) has won approval from the HCMC government to develop a housing project at a location formerly allocated to another developer.

Phan Anh Dung, deputy general director of the company, told the Daily on the phone on Tuesday that work had started on a detailed design and necessary procedures for a construction license so that the project in the outlying district of Thu Duc could get off the ground pretty soon. The former developer delayed its project for over 10 years.

The city authorities handed over two hectares of land in Hiep Binh Chanh Ward to Phu Nhuan Housing Trade and Construction Company in 1998, but the company had not finished compensation and site clearance.

Dung said PPI planned to invest some VND1.3 trillion to develop the Water Garden Apartment project comprising four blocks of flats, retail podium and other service facilities.

The city, however, has given PPI a deadline for finishing construction and warned that the city will revoke the land if the company also fails to complete necessary procedures to get the project moving within 12 months from the date of receipt of the land.

Work on the project will begin in the middle of next year and be completed within four years.

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SMEs believe in decisive role for national development

A majority of Vietnam’s small- and medium-sized enterprises (SMEs) believed in their decisive role for the future of the national economy as well as were their business development prospects.

The result was indicated in an annual survey on Asia’s business situation conducted by the world’s leading transportation group UPS called Asia Business Monitor (ABM) which was announced Wednesday.

The 2010 ABM was conducted on around 1,350 leaders of SMEs from 13 countries and territories, including Australia , China , Hong Kong , India , Indonesia , Japan , the Republic of Korea , Malaysia , the Philippines , Singapore , Taiwan , Thailand and Vietnam . This was the first time Vietnam took part in the survey.

According to the survey, 59 percent of Vietnamese SMEs showed their optimism about further development of the Asia-Pacific economy, 9 percent said the regional economy sees a downward trend and the remaining 32 percent said it will remain unchanged.

Vietnam was the second optimistic market in the region in business development prospect in 2010 with 72 percent of interviewed businesses saying their companies will reap better results this year. Indian businesses are the most optimistic about this prospect with 85 percent.

Although nine out of ten Vietnamese SMEs pay attention to business activities in the Asia-Pacific market, they also expect their growths in other regions. Eighty-one percent of surveyed businesses forecast that Vietnam ’s business activities will increase 61 percent in North American and 60 percent in Europe .

Fifty-eight percent of Vietnamese SMEs said international business has positive impacts and opens up new opportunities for their operations. They added that architecture-construction, information technology and tourism will be key sectors in 2010.

Although the national economy is forecast to keep growing this year, Vietnamese businesses are facing a lot of challenges, particularly, high credit interest rate and competitiveness pressure.

Vietnam’s SMEs said the government’s supportive polices are very necessary for them to improve their competitiveness.

 

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