Finance
Vietnam must tighten belt for lean times, says EIU
18/Mar/2009 Intellasia | 17/Mar/2009 Thoi Bao Kinh Te Vietnam
After high growth rates for many years, Vietnam's GDP fell to 6.23% in 2008. But now with the financial crisis that started to grip at the end of last year, increasingly pessimistic assessments of Vietnam's growth prospects have been put forward by international credit organisations such as the World Bank, International Monetary Fund, and banks such as HSBC and others.
Recently, the Economist Intelligence Unit (EIU) on March 16 was the most downbeat in an article that forecast Vietnam's GDP at near zero of only 0.3% in 2009.
Defending his projection, EIU's director for Southeast Asia, Justin Wood, said his forecast was based on external impacts likely to affect the country. Three impetuses for Vietnam's economic growth -- exports, investment and consumption --will sharply reduce this year, Wood said.
With Vietnam's strong exposure to foreign markets and given that world consumer markets are contracting sharply, imports by key markets such as the US, EU, Japan are expected to plunge by 52% this year and will inevitably hit Vietnam's exports hard.
Regarding foreign direct investment, the EIU anticipates that global, FDI will be slashed by some 70% this year. As for Vietnam, actualised FDI in 2009 will fall to only US$2.2 billion from just US$7.6 billion in 2008. This will compound and restrict production of goods for exports by Vietnam, Wood said.
In the following interview, Wood elaborated further with various Vietnamese newspapers. Excerpts:
The Economist magazine's second round-table business conference was held in March 17-18 amidst the downturn of the world's economy. Regarding the forecast on the global economy in 2009, EIU is seemingly more pessimistic than any organisation. Why so?
I believe that almost everyone accepts the fact that the global economy in 2009 will continue to weaken and we forecast the world economies to contract by minus 1.8%. The period of the biggest credit bubble in history when money was abundant and cheap has gone. The negative side of such period was that western economies, particularly the US and Britain, reported all-time high debt. We are now having to pay for that period of excess. Banks are scrutinising their balance sheets and offer few loans. Consumers are cutting back on debt and spending far less. The fear of risk is increasing and financial markets are still very tense.
Under such circumstance, all economies in the world will feel the impact. Although the world's emerging economies, for example Asian economies, did not join the rush into debt [like the West], those same economies nonetheless are also hurting badly. Demand for exported items in the region is evaporating and investors are withdrawing their investments, which is putting high pressure on stock markets and making it very difficult to raise capital.
The EIU forecast that Vietnam's GDP in 2009 will grow by only 0.3%, some 5% lower than the all-time low GDP growth recorded at the time of the financial crisis in Southeast Asia over one decade ago. Why does this current situation impact Vietnam's economy more adversely than the impacts of that financial crisis?
What we should mention first is that although Vietnam's GDP growth that we forecast looks low, in fact, that figure is still far higher than almost all other Asian countries. Namely, we forecast that GDP of some economies will fall to negative levels, for example, Singapore we expect will contract by 7.2%, Taiwan -5.5%, and Japan -5.5%. We see only a few economies that could post positive growth this year and the exceptional cases include China with 6%, India 5% and Indonesia 1.5%.
So why should Vietnam's economy be weaker? This first reason is a reduction of exports that results from expenditure cuts by Americans, Europeans and others.
The second reason is reduction of personal consumption that is the result of the increasing unemployment rate and the decrease in incomes due to high inflation in Vietnam in 2008.
The third reason comes from reduction of investment.
Regarding why this crisis will impact Vietnam more adversely than the previous crisis, over the last decade, Vietnam has integrated more deeply into the global economy and hence the country is impacted from global events much more than 10 years ago.
Vietnam sticks head in sand on 'buoyant growth' forecast
18/Mar/2009 Intellasia | Lao Dong Online
Speaking at the conference held on March 17 and 18 under the cooperation of the Economic Research Institute for Asean and East Asia (ERIA) and Vietnamese Ministry of Planning and Investment's Central Institute for Economic Management, Dr Vo Tri Thanh was adamant that Vietnam's 2009 GDP growth will be at least 4% despite a forecast by the Economist Intelligence Unit released a gloomy report putting Vietnam's 2009 GDP at just 0.3%.
The global economic earthquake has affected strongly to Eastern Asia and Asean countries whose economies are very active and open. So the conference pointed out the serious impacts of the crisis, challenges and experiences of many nations to counter with the financial storm, said Thanh.
In 2009, Vietnam could retain a satisfactory agricultural growth at 3.5-4%, contributing 0.8% of GDP while the service will grow by 4-5%, 1.6% of GDP contribution. Meanwhile, the industry and construction sector will continue stabilising the disbursement of investment capital supplies thanks to the government's US$6 billion stimulus package.
The Economist's prediction on Vietnam's 2009 growth of 0.3% is too pessimistic and Vietnam's economy was devalued. Everyone all will be surprised at the shocked figure, according to Martin Rama-World Bank director in Vietnam. Most recently, World Bank forecasted that Vietnamese economy could grow by 5.5% this year, lower than the initial figure of 6.5%.
At the conference, Dr Zhang Yungling, director of Institute of Asia-Pacific Studies under the Chinese Academy of Social Sciences, pointed out the Chinese government's flexible policies to fight the global economic crisis. As a result, when the US financial recession broke out, China's imports slumped more sharply than exports. From the end of 2008 to the beginning of 2009, the country's industrial production also continuously went down so the government changed the macro-economic policies from the monetary tightening up measures to the cutting down of basic rates and compulsory reserve ratio by five times. After that, Chinese government launched the four trillion yuan economic stimulus package within two-years for infrastructure, development programme in rural areas, housing development, industrial sector restructure, and reduced import tariffs.
However, the Chinese doctor assessed, like Vietnam the more importance is that Chinese banks had a little involvement in the US's under-regulated lending so the country did not suffer strong impacts from the collapse that had happened to Asia countries in the 1997 regional crisis.
Although Vietnam shifted policies to combat against the financial crisis, the economic open-door remains limited creates negative impacts on commence, investment and finance so the country will continue facing many difficulties and challenges, Zhang Yungling commented.
According to Dr Vo Tri Thanh, 60% of Vietnam's exports rely on big markets of US, EU, and Japan. Thus, once the big economies have not rallied yet, Vietnam's export activities will be likely influenced, followed by investments.
Last year FDI inflow to Vietnam accounted for 30% of total investment while FII through G-bonds, stock market made up high ratios, 39% in bonds and 25% of total market capitalisation of Vietnam. But, the figures are in downward trend.
Vietnam's total trade deficit was ballooned to over US$17 billion last year, particularly the trade gap between Vietnam and China was US$12 billion (meaning Vietnam spent much money importing China made goods) and the country only reached trade surplus with US and EU.
Meanwhile, Vietnam's investment ratio on GDP was very high (41% in 2008) due to the increase in state investment and FDI whereas private investment was tending to fall.
Moreover, GDP growth mainly depends on investment, so Vietnam's capital disbursement speed is almost standstill while the added value of industry and construction sector has dropped sharply since the fourth quarter of 2008, showing a unsustainable growth, reported Dr Thanh.
Office rentals expected to fall as supply spikes
18/Mar/2009 Intellasia | CafeF
While rental prices of offices for lease are on a downward trend, the marketing organisation for BID Tower, CB Richard Ellis, announces the leasing price of up to US$70 a square metre a month plus service charges on top.
Currently, some companies which want to expand their offices in Hanoi find it hard to seek A-level offices with wide areas and have no way but to accept high rental prices if they like to stay in the city's centre.
HCM City-based companies have more options with newly-built A-level office buildings such as Centec and Asiana Plaza and other high-rise buildings such as Sailing Tower, Havana and Centre Point of which quality is nearly the same as A level.
High-rise building owners have suffered from high pressures over the last five months. Newly-built high-rise buildings or to-be-launched buildings have rental prices reduced by up to 30%. The decrease in rental prices of many new buildings has resulted in an average price reduction of 14.3% for A-level high-rise buildings, 28.2% for B-level high-rise buildings and 24.5% for C-level buildings in the first quarter against last year. The average rental price in the first three months is US$60 a square metre for A-level buildings, US$28 for B-level buildings and US$20 for C-level buildings.
However, the downtrend has not yet stopped because companies continue cutting costs, narrowing operations while supply of office-for-lease buildings is on the increase. HCM City is expected to have another 228,000 square metres of A-and-B-level offices to be put in use this year, up by 49% against total areas by last year.
With such high supply, CB Richard Ellis forecasted that A-level offices will be offered at very low rental prices by the end of this year, only US$30 -60 a square metre, B-level offices US$18 -25 and C-level offices US$8 -12.
The above forecast is nearly the same as opinion made by Toby Dodd, general director of Cushman & Wakefield, at the end of last year.
Meanwhile, CB Richard Ellis still offers A-level office buildings at high prices because of very good performance of A-level high-rise buildings in Hanoi. According to John Gallader -CB Richard Ellis's vice director, despite cost reduction of companies and difficult economy, A-level office buildings around Hoan Kiem Lake are nearly fully occupied.
Rental prices of A-level high-rise office buildings are staying at high levels, US$52.5 a square metre a month on average, reducing by about 2% against the end of last year. Rental prices of B-level buildings also reduce by only 3%, averaging at US$33.75 a square metre a month.
"Seeing those figures, I can see supply of A-level buildings remains limited while demand for A-level buildings are still high. The global financial crisis has resulted in closures of many representative offices but many other companies still want to expand operations. And, there are now not much room for them to open offices," said Gallander.
However, Brett Ashton, general director of Savills Consultancy Co, said that Hanoi market will follow the general downtrend amidst the economic recession and increasing supply of offices.
A real estate consultant commented that although the A-level office market segment remains limited in supply, Bidv Tower will meet various difficulties in leasing offices at US$70 a square metre because Capital Tower is going to be completed soon and some other high-rise buildings such as CDC, CEO Tower are preparing to come into operation.
CB Richard Ellis also admitted that the average rental office price in Hanoi will gradually reduce by the end of this year because another new 140,000 square metres m2 will come into operation and demand for office lease will decrease gradually. The difference between offer prices and realistic rental prices will be wider because building developers will seek all ways to keep and attract clients by reducing realistic rental prices.
Robert MacDonald, chief of Savills's customer consultation division, advised companies to snap up such rare opportunity to reconsider their operation costs, reappraise future demand for office lease and well know the market information to improve their status in negotiating office rental prices.
Some companies will take this opportunity to move to high-rise buildings with higher quality that have the same prices or lower prices than the current prices.
Vietnam bans rice speculation
18/Mar/2009 Intellasia | Reuters
Vietnam moved to quell panic over rice supplies on Monday, banning speculation in the market after a "chaotic" buying binge at the weekend highlighted growing global fears about food security.
Queues and empty shelves were still evident on Monday as the world's second-biggest rice exporter joined other nations in feeling the impact of a nearly threefold rise in rice prices this year, a rally triggered by exports curbs by top suppliers --including Vietnam itself, which has banned exports through June.
The growing sense of crisis over soaring food costs and supplies caused riots in Africa and toppled Haiti's government. Although Asia consumes over 80% of the world's rice, the impact has been limited as countries like China, India and Japan are self-sufficient.
The frantic pace of price increases in Thailand, the world's largest rice exporter, looks set to cool in the weeks ahead, a Thai rice exporter said, with improved supplies.
"The market is likely to correct up to 20% even if the bans by India and Vietnam remain," Korbsook Iamsuri, the secretary general of the Thai Rice Exporters' Association told Reuters on Monday.
"Crop arrivals are much better than what it was three weeks ago," she said, as Thai prices remained above the historic US$1,000 (500 pounds) per tonne level reached a week ago.
Over the weekend, in HCM City, Vietnam's largest urban area of about eight million people, people rushed to supermarkets and street markets in scenes described as "chaotic" by some local media reports.
Concern mounted in the southern city many still call Saigon after a popular supermarket chain, Saigon Co-op Mart, said it was selling only 10 kilogram of rice for each purchase. That came less than a week after US giant Wal-Mart Stores Inc's Sam's Club warehouse division put limits on purchases of rice.
By Monday, there were lines at the co-op and people loading up bags of rice, although it was also a sale day for food and other produce to mark the April 30 Liberation Day holiday.
Authorities are trying to reduce hoarding and a supermarket worker filling bags of rice said, "We don't want people to buy a lot at the same time".
At Ba Chieu market in the city centre on Sunday, some stalls were empty and people were seen loading up to 10-kilogram bags of rice on motorbikes as vendors raised prices on the spot.
"The government should control the price," said a customer in the market, who declined to give her name. "It is rising very fast and sometimes it changes daily. If prices are too high, people will go hungry."
World Bank Help
The events in Vietnam came as the Philippines said it has asked the World Bank to persuade rice-exporting nations to lift shipment curbs that threatened the food security of importing countries.
"I have asked the World Bank if it's possible to use its moral persuasion, its stature, its influence to talk to the supplier countries," Agriculture Secretary Arthur Yap told local television.
Rice has become a hot political issue in the Philippines. Yap confirmed the Philippines is considering rolling back the government's direct role in subsidising expensive rice imports.
The Vietnamese government, facing the challenge of double-digit inflation as it makes the transition to a market economy, blamed hoarding and speculation for the weekend buying spree, and reacted by ordering local authorities to regulate markets and ban non-food traders from trading rice.
"Our food output in 2008 is fully able to ensure sufficient domestic consumption and also to set aside part for exports," it said in a statement broadcast nationwide on Voice of Vietnam radio on Monday.
Hoarding and Speculation
Vietnamese rice mills, food supplying companies, coffee or pepper trading houses and even share investors have invested in buying rice for hoarding to make profits, said Truong Thanh Phong, Chair of the Vietnam Food Association.
The government statement said it "strictly forbids organisations, individuals without function to trade food, from buying paddy and rice for speculation."
Food companies and farmers have more than 1.3 million tonnes of rice in stock, the government said. It said it has also been buying rice to boost national reserves.
The consumer rush for rice took place even as Vietnam's output for the winter-spring crop was estimated at 9.9 million tonnes, 400,000 tonnes higher than last year.
Rice prices in Vietnam have risen 25% this month from the end of March and surged 85% since last April to 5,500 dong (35 US cents) per kilogram of paddy as of Friday.
Rice futures on Chicago Board of Trade also rose more than 1%, as continued strong demand from rice-importing nations such as the Philippines provided support.
IMF cuts Vietnam growth to 4.75% due to crisis
18/Mar/2009 Intellasia | Reuters
The International Monetary Fund said on Tuesday economic growth in Vietnam is likely to slow to 4.75% this year, perhaps more, in the face of global economic turmoil, putting pressure on the exchange rate.
In December, the IMF projected Vietnam's growth will drop to 5% in 2009.
Still, the Fund said that over the medium term the economic outlook for the country was favourable and Vietnam would remain an attractive investment destination.
In the near term, however, the country faced "substantial" challenges tied to the sharp deterioration in global economic conditions, the IMF said in its latest review of Vietnam's economy.
"Economic growth is expected to slow in 2009 with capital inflows, exports, and private remittances likely to decline significantly, while the current account deficit will remain large," the IMF said.
It said risk aversion remained "acute" as foreign investors continued to reduce their portfolio exposures to Vietnam, particularly in bonds and the stock market. Meanwhile, depreciation pressures on Vietnam's dong currency had resurfaced, it said. The IMF urged the authorities to allow for greater exchange rate flexibility, and said IMF staff estimates show that the dong "appears somewhat overvalued compared with its estimated medium-term equilibrium level."
The Fund also said that the authorities should assess the effects of recent monetary adjustment before considering easing further.
Vietnam keeps bad debt below 3.5% of loans
18/Mar/2009 Intellasia | Reuters
Vietnam's banking system remains stable, with good liquidity, and the bad debt ratio remains below last year's rate of 3.5% of loans despite the impact of the global recession, the central bank governor said.
"The results of credit institutions' operations show banking activities are relatively stable, deposits and credit being expanded, interest rates on a declining trend," State Bank of Vietnam Governor Nguyen Van Giau said in an interview published on Tuesday.
None of the country's more than 40 banks faces payment problems and "the bad debt ratio is kept lower than 2008", Giau said in the interview with the official Vietnam News Agency published on the central bank's website.
Last December Giau said bad debt in the banking system was expected to reach 3.5% of loans by the end of 2008, up from 2% a year earlier.
Giau gave no value figures for the loans or the bad debt.
The central bank aims to keep credit growth this year at around 20%, after monetary tightening to contain inflation early last year led loan growth to slow to 21-22% from a surge of 54% in 2007.
PM announces 36tr dong G-bond plan
18/Mar/2009 Intellasia | government Website
Ministries and cities' governance on March were assigned to carry out the issuance of 36 trillion dong G-bonds for 2009.
In which, 21 trillion dong of G-bonds is allocated to the traffic and transportation sector, including the state managed projects worth 13 trillion dong, and 8 trillion dong for projects managed by local governances. Also, the irrigation sector was assigned to use eight trillion dong (raised from G-bonds), in which 3.850 trillion dong is disbursed for state managed projects and 4.150 trillion dong for local irrigation works.
The prime minister also decided to allocate one trillion dong of G-bonds for the resettlement of Son La hydropower project, three trillion dong for districts' and provinces' general hospitals according to the National Assembly's Resolution No 18/2008/QH12 and another 3 trillion dong for the school reinforcement programme.
In addition, the remaining capital of 7.7 billion dong being mobilised from G-bond issuance in 2008 will be continued to be used within this year.
[Decision No 350/QD-TTg dated March 16, 2009]
Joint stock banks beef up capital base
18/Mar/2009 Intellasia | Tuoi Tre Online
Some joint stock banks held shareholders' meeting for 2009 and all planned to raise the chartered capital through offering new shares to shareholders.
Yesterday Eastern Asia Commercial Joint Stock Bank (EAB) passed the 2009 business plan with total pre-tax profit of 750 billion dong, a y-o-y growth of 7.1%, a dividend of 12%. The bank will raise chartered capital from the current 2.880 trillion dong to 3.4 trillion dong, in which 520 billion dong of shares will be offered to the shareholders according to the ratio of 18 new shares for 100 old shares by June 2009.
Also, the bank's director board was assigned to negotiate with domestic and foreign partners to hike chartered capital to no more than 4.5 trillion dong.
Previously, Saigon Thuong Tin Commercial JS Bank (Sacombank) decided to increase its capital from 5.116 trillion dong to 6.7 trillion dong (by 31%) through paying the 2008 dividend of 15%, issuing a share volume equalling to 15% of chartered capital to the shareholders. Another five million of STB coded shares will be offered to the key employees. The bank plans to reach 1.6 trillion dong profit and a dividend of 14-16% this year.
Similarly, Saigon Commercial Joint Stock Bank (SCB) passed the plan of hiking chartered capital from 2.047 trillion dong to 3.374 trillion dong by issuing convertible bonds to existing shareholders at ratio of 1:100 (meaning that one bond will be converted into 100 shares when due) and foreign partners. SCB's convertible bonds will have a mature of 13 months and coupon rate of 12%.
Viet Phu E-payment Corp to launch forex service
18/Mar/2009 Intellasia | 17/Mar/2009 State Bank of Vietnam
Under an Official Dispatch No 56/GP-NHNN issued on March 16 by the State Bank of Vietnam (SBV)'s governor, HCM City-headquartered Viet Phu E-Payment Corp is allowed to provide foreign exchange service.
Accordingly, the company will carry out remittance delivery service from overseas Vietnamese and foreigners to receivers in Vietnam via the company's headquarters.
The company must obey Vietnam's current regulations on foreign exchange management and other relevant regulations.
NaviBank licensed for gold trades
18/Mar/2009 Intellasia | 17/Mar/2009 State Bank of Vietnam
The State Bank of Vietnam (SBV)'s governor on March 16 issued a Decision No 543/QD-NHNN and another Decision No 544/QD-NHNN allowing Nam Viet Commercial Joint Stock Bank (NaviBank) to launch gold trading activities according to the current regulations.
In addition, the central bank also approved the resolution of bank's shareholders' meeting. Accordingly, the bank's headquarters will be located at No 343 Pham Ngu Lao St in HCM City's Dist 1 and the bank's chartered capital will be one trillion dong.
At present, the bank has a chartered capital of one trillion dong.
These decisions take effect from the signing date.
EAB targets 750b dong '09 profit
18/Mar/2009 Intellasia | 17/Mar/2009 CafeF
The 17th annual shareholders' meeting of Eastern Asia Commercial Joint Stock Bank (EAB) held on March 17 passed many important decisions.
Accordingly, this year, EAB targets to gain 750 billion dong in total profit, a year-on-year rise of 7.1% and increase chartered capital to 3.4 trillion dong (in 2008, the bank's chartered capital increased from 1.6 trillion dong to 2.88 trillion dong).
The lender also plans a 12% dividend payment in 2009.
EAB will scale up its chartered capital via offering 52 million ordinary shares at 10,000 dong par to the existing shareholders at the ratio of 100:18 (18 new shares for 100 old shares) at the end of this June.
In addition, the bank's director board was assigned to negotiate with domestic and foreign partners to increase more chartered capital but not exceed 4.5 trillion dong.
The bank's additional chartered capital will be invested in infrastructure and business activities and provided to Eastern Asia Finance Co.
Due to unfavourable conditions from Vietnam's stock market, EAB will not list shares in the first quarter this year to ensure the interests of shareholders.
Additionally, the bank's shareholders' meeting also will suspend the equitisation for EAB Securities Co.
Notably, this shareholders' meeting shortened the share holding duration of staff to three-years instead of seven-year approved in the 15th shareholders' meeting.
EAB's some targets for this year are 40 trillion dong in total assets, rising 19% against 2008, 32 trillion dong in total deposit, 27 trillion dong in total outstanding loans, US$2.4 billion in revenue from international payment services, US$1.2 billion in revenue from remittance services.
The bank also plans to issue more 1.5 million cards, a year-on-year increase of 100%.
In 2008, EAB's profit was 703 billion dong including 11 billion dong from remittance services and 1.6 billion dong from securities arm.
First Vietnam-Laos cross-border payment service launched
18/Mar/2009 Intellasia | 17/Mar/2009 Cong Thuong
The Bank for Agriculture and Rural Development (Agribank) and Laos' Phonsavanh Bank have recently inaugurated Vietnam-Laos cross-border payment service via the Lao Bao and Densavan border gates at the Lao Bao Special Economic Zone in Huong Hoa district in the central province of Quang Tri.
The cross-border payment service will included seven payment methods including banking bill, cross-border money delivery voucher, trade payment voucher, cross-border payment mandate letter, money delivery, cross-border voucher credit letter and guarantee letter for cross-border payment.
In addition, two banks are allowed to directly carry out currency exchanges of Laos' LAK and dong according to the forex rate.
This will create favourable conditions to ensure the implementation of cross-border payment service in an effective manner.
Vietnam's Agribank has successfully managed cross-border payment services between the Sino-Vietnamese border for many years.
VIB Bank signs cooperation deal with PTI
18/Mar/2009 Intellasia | Vietstock
Vietnam International Commercial Joint Stock Bank (VIB Bank) and Postal Insurance Joint Stock Co (PTI) today march 17 signed a comprehensive cooperation agreement whereby two sides will take each other's advantages and exchange experiences in finance.
Both signatories will set up a special assignment group in charge of studying and launching the banking insurance product packages through VIB network. PTI pledged to provide the financial support to VIB Bank through capital mobilisation from funds. In return, VIB will help PTI design and release insurance products suitable to the bank's each customer group.
Tourism firm Vinpearl to raise 1tr dong in bonds
18/Mar/2009 Intellasia | 17/Mar/2009 CafeF
March 17 will be the registration deadline to buy bonds issued by Vinpearl Trade and Tourism Service Joint Stock Co (coded VPL) under the guarantee of Bidv's Quang Trung Branch, according to VPL.
The company plans to mobilise one trillion dong of bonds with five-year term.
These bonds will be issued on March 18 with the coupon rate of 10.1% per annum for the first year.
The coupon rate for following years will be defined based on the G-bonds with the same term plus 3.5% pa.
In case the G-bonds issuance fails, the coupon rate will be defined based on the average saving rate in dong of 12-month term of the Bank for Investment and Development of Vietnam (Bidv), the Bank for Foreign Trade of Vietnam (Vietcombank) and the Bank for Agriculture and Rural Development (Agribank) plus 2.5% a year.
Bidv's Quang Trung Branch and Bidv's Securities Ltd Co will be consultant and arranger for the company's bond issuance.
CPD0911004 G-bonds to be traded on HaSTC from March 20
18/Mar/2009 Intellasia | 17/Mar/2009 HaSTC
Based on the Document No 134/KBNN-HDV dated February 3, 2009 by the State Treasury and the Dispatch No 277/TB-TTLK dated March 10, 2009 by the Securities Depository Centre, Hanoi Securities Trading Centre (HaSTC) has announced the first listing and trading date of G-bonds CPD0911004 on the northern bourse.
* Issuer: State Treasury-Minsitry of Finance
* Bond name: government bond
* Bond type: G-bond issued by method of auction
* Bond form: book entry
* Face value: 100,000 dong/bond
* Total listed volume: one million bonds
* Total listed value: 100 billion dong
* Bond code: CPD0911004
* ISIN code: VNTD09110048
* Bond term: two-years
* Coupon rate: 6.7% per annum
* Issue date: February 16, 2009.
* Maturity date: February 16, 2011.
* Payment method: Bond principal is paid once at the par value on the maturity date. Coupon is paid on the issue date of each year (first coupon payment is on 16/02/2010). At maturity, if the bondholder has not come to get principal and coupon payments, the principal and coupon payments will be reserved without interest after the maturity date.
* First trading date: March 20, 2009.
Gold price drops, forex rate at 17,700 dong/US dollar
18/Mar/2009 Intellasia | 17/Mar/2009 CafeF
The domestic gold price yesterday March 17 continued to fall slightly by 20,000 dong per tael (1.2 oz) to 19.52 million dong per tael against previous day. The US dollar price also dropped by 10 dong to 17,700 dong/US dollar.
At Saigon Jewellery Joint Stock Co, the SJC gold price was listed at 19.45 million dong/tael (as buying price) and 19.54 million dong/tael (as selling price).
At Bao Tin Minh Chau Co, the selling price remained unchanged at 19.52 million dong/tael meanwhile the buying price listed at 19.42 million dong/tael, falling by 10,000 dong per tael day on day.
At ACB gold trading floor, the trading price was 19.385 million dong/tael with the trading volume of about 14,720 taels worth 285.34 billion dong.
As for foreign currency market, the US dollar price dropped by 10 dong against previous day to 17,680-17,700 dong per US dollar (buying and selling price) in the free market.
According to the State Bank of Vietnam (SBV), the quoted forex rate was 16,977 dong/US dollar in the interbank market and it was 17,485-17,486 dong/US dollar at commercial banks.
Brokers ordered to archive all electronic orders for a decade
18/Mar/2009 Intellasia | 17/Mar/2009 CafeF
Under a Circular No 50/2009/TT-BTC issued on March 16 by the deputy minister of finance, Tran Xuan Ha, securities companies must save all electronic transaction orders and record all phones for orders for at least 10 years.
According to the circular, securities brokers will directly provide online securities transactions to investors to open accounts, make orders and offer requirements for securities transactions and receive the results via internet or by phone.
Share codes being traded in online transactions must be shares being traded on the stock trading floor.
The circular will take effect after 45 days as of the signing date.
Export tariff on coal adjusted
18/Mar/2009 Intellasia | Thoi Bao Kinh Te Vietnam page 1
The Ministry of Finance yesterday March 17 issued Circular No 51/2009/TT-BTC changing the export code and tariff on coal subject to the Category 44.02 of the preferential import and export tariff list.
Accordingly, the sorts of coal Category 4402.10.00.00, 440.290.00.90 will suffer the preferential import duty of 5% and export tariff of 10%, Category 402.90.00.10 will be applied the export tariff of 5% as well.
The circular will be applied on customs declaration from March 23, 2009.
Business
VN Index bounces 3.97% to 273.39 pts
18/Mar/2009 Intellasia | AtpVietnam | HaSTC
Following the increasing impetus from previous sessions, the Vietnam's stock market today March 18 continued increasing as the VN Index jumped 10.19 points or 3.97% to 273.39 pts with a total matching order trade of 27.4 million shares worth 508.96 billion dong.
Statistic from STC showed that among 175 share codes and four fund certificates being listed on the southern bourse, the stock market saw 153 shares increased with 86 reaching the ceiling price, 14 others decreased and 12 remaining shares stood still.
Most blue-chips reached the ceiling price.
Particularly, DPM jumped 1,400 dong per share to 31,000 dong, FPT +2,200 to 47,800, HAG +1,000 to 55,000, ITA +1,000 to 21,500, PPC +900 to 20,500, PVD +2,500 to 59,000, PVF +800 to 17,400, SSI +1,100 to 24,500, STB +800 to 17,300, VIC +1,700 to 38,700, VNM +3,000 to 79,500 and VPL +1,400 dong to 42,600 dong per share.
STB still led the market in terms of trading volume with 3.52 million shares and followed by SAM with 1.56 million, DPM 960,000, FPT 910,000, PVT 850,000 and VF1 and VF4 with 2.77 million and 1.1 million respectively.
Like the southern bourse, the Hanoi Securities Trading Centre (HaSTC) today March 18 kept increasing as the HaSTC Index bounced 4.57 points or 4.88% to 98.14 pts with the total market trade of 15,665,263 shares valued at over 264 billion dong.
Amongst 177 listed shares on the northern floor, the stock market recorded 19 shares decreased including CIC, CTB, CTC, DHT, HHC, HUT, L61, L62, MKV, PSC, QST, SEB, SRA, TBX, TDN, TPH, VBH, VC6 and VHL, six shares with no trade namely BST, CJC, HSC, NPS, QTC and SDS, four shares remained unchanged including BTH, DAE, GHA and LBE and 148 remaining shares increased.
Some big gainers were VSP +2,800, NTP, VNR and SCJ +2,200, KBC +2,100, S99 and VC2 +2,000, NBC and RCL +1,900, ACB, SD5 and VCS +1,800, PVS and SD7 +1,700, HLY and PVI +1,600, MIC +1,500, and DTC, PAN, PVC and SDC +1,400 dong per share.
BCC suddenly gained the pole place in trading volume with 2.693 million shares and then ACB with 2,519,600, BTS 2,183,900, VCG 795,000, PVS 448,700, KLS 365,700 and DBC with 354,600 shares being traded.
Business briefs Mar 18
18/Mar/2009 Intellasia
* Top broker Saigon Securities Inc (SSI) reported registered to buy extra 331,300 PAN coded shares of Pan Pacific Joint Stock Co between March 18 and April 18, 2009. Earlier, SSI purchased 368,700 PAN shares, bringing its size in PAN to 5.268%.
* March 17 will be the registration deadline to buy bonds issued by Vinpearl Trade and Tourism Service Joint Stock Co (coded VPL) under the guarantee of Bidv's Quang Trung Branch, according to VPL. The company plans to mobilise one trillion dong of bonds with five-year term. These bonds will be issued on March 18 with the coupon rate of 10.1% per annum for the first year. The coupon rate for following years will be defined based on the G-bonds with the same term plus 3.5% pa.
* Phu My Water Supply Joint Stock Co (Phu My Wasuco) has released the 2008 business results with total revenue of 33.5 billion dong, a year-on-year rise of 21.46%, after-tax profit of 17.1 billion dong, up 15.57% and EPS of 3,236 dong/share against 2007's 3,061 dong. In 2008, the firm paid a dividend of 25%, higher than the previous year's 29%.
* Binh Dinh Agricultural Materials and Technique Joint Stock Co (ATM) reported that last year it earned 778.9 billion dong in net revenue from sales and service provision, 20.2 billion dong in total after-tax profit, and EPS of 7,028 dong, growing by 46.08%, 188.57% and 66.3% correspondingly compared to 2007.
* The HCM City Book Distribution Corp, better known as Fahasa, will open the biggest bookstore of its chain worth 100 billion dong at 387-389 Hai Ba Trung Street, District 3, tomorrow. With over 120,000 titles, foreign and domestic, the store will hold a draw for valuable prises in May for those spending at least 100,000 dong.
* Japan's Kobe Steel Ltd and Sojitz Corp plan to set up a US$300 million venture to develop an iron project in Vietnam, according to the Foreign Investment Department under the Ministry of Planning and Investment. The Japanese venture will build a plant to produce iron nuggets and survey iron ores with an initial investment of US$1 million.
* DAP No 2-Vinachem Joint Stock Co has made its debut in the northern mountainous province of Lao Cai with four founding shareholders, of which Vietnam National Chemical Corp (Vinachem) holds a 51% stake. The company will complete DAP No 2 fertiliser plant, worth nearly five trillion dong, with an annual capacity of 330,000 tonnes by 2012 in Tang Loong Industrial Zone.
* Tay Do Resort and Ecotourism Joint Stock Co has begun construction of the Tay Do resort, the Mekong Delta's largest, on 15.3 hectares in Chau Thanh A District. The 760 billion dong project, once operational by 2011, will have 200 rooms, entertainment and sports facilities, a supermarket, a three-star hotel and a residential area for the elderly.
* Southern FPT Telecoms Co Ltd, a subsidiary of HCM City-based FPT Telecoms Corp, has opened a branch on 30/4 Street, Ninh Kieu District of the Mekong Delta's Can Tho City. The branch will offer customers broadband high-speed internet services via Symmetric Digital Subscriber Line (SDSL) and Fiber-to-the-home (FTTH), and other added value services like iTV and iVoice via the high -speed internet bandwidth. The company will launch a promotion for customers registering for the services from now to month-end.
* Ha Tay Brewery Co Ltd, authorised producer of Tiger and Heineken in northern Vietnam and established in November 2003, has been renamed Asia-Pacific Brewery Hanoi and has appointed Lee Larry general director. The brewery distributes its products in 28 provinces and cities in the north.
* Asia Refrigeration Industry Co Ltd, an affiliate of Seaprodex Refrigeration Industry Corp, yesterday broke ground for its plant worth nearly 300 billion dong and covering 25,000 square metres in Binh Tan District's Tan Tao Industrial Park. The plant, once operational in August, will offer 300 jobs with average monthly incomes of 4.5-5 million dong.
* PetroVietnam Gas Corp, a member of the Vietnam National Oil and Gas Group, yesterday started work on a liquefied petroleum gas depot and an entrance/exit checking station for tankers worth over 226 billion dong and covering 6.3 hectares in the east industrial park of the Dung Quat Economic Zone in Binh Son District. The project, mainly a transit facility for products going from the Dung Quat Oil Refinery Plant to the southern central coastal region and the Central Highlands, will be finished by the first quarter of next year.
* The State Bank of Vietnam (SBV)'s governor on March 16 issued a Decision No 543/QD-NHNN and another Decision No 544/QD-NHNN allowing Nam Viet Commercial Joint Stock Bank (NaviBank) to launch gold trading activities according to the current regulations.
* Under an Official Dispatch No 56/GP-NHNN issued on March 16 by the State Bank of Vietnam (SBV)'s governor, HCM City-headquartered Viet Phu E-Payment Corp is allowed to provide foreign exchange service.
* Vietnam International Commercial Joint Stock Bank (VIB Bank) and Postal Insurance Joint Stock Co (PTI) today march 17 signed a comprehensive cooperation agreement whereby two sides will take each other's advantages and exchange experiences in finance.
Sources: Thoi Bao Kinh Te Vietnam, Lao Dong, Nguoi Lao Dong, Dau Tu, Dau Tu Chung Khoan, Tuoi Tre, Thanh Nien, Tin Tuc, Nhan Dan, Vietstock, SSC, VCBS, HaSTC.
Dragon Capital expects profitable year
18/Mar/2009 Intellasia | CafeF
Dominic Scriven-director of Dragon Capital investment fund had a talk on the fund's action plans in 2009 as outlined in the following interview:
How do you expect in profit from Vietnamese stock market in 2009?
I know everyone all is disappointed about previous forecasts on the development prospect of Vietnamese stock market, but at present, almost the market slumps are over. Market plunges in 2009 will be only temporary and will start to surge again immediately. Both Vietnam's and the world's finance market showed bottom levels, so we will start to build development based on the foundation thanks to long-term investments (over three months). I expect that Dragon Capital could reach the profit growth of over 30% from the current level. But no one can predict what will happen in future.
Which shares should investors to pump capital into? Can you reveal your investment portfolio particularly?
In investment, experience is very important. All global investors must have awareness that pouring entire capital into securities is at high risk. We [investors] always have to own many "investment bags": bags of real estate, gold, bonds, money and shares. In the current context, I have both shares and bonds because bonds will help ensure my capital and bring in sustainable earnings. However, we have to predict inflation in advance. If the coupon rate of bonds is around 8-9%, inflation must be lower the figure to reach a capital safety. In case the market rallies, shares also will be a good investment opportunity.
What will Dragon Capital do if the financial crisis lasts till 2010?
The answer is very simple. We will try to raise capital.
How far has Dragon Capital's NAV fallen since the start of 2008?
Foreign securities investment funds in Vietnam all had to witnessed a sharp fall of 50% in net asset value. The NAV reduction of Dragon Capital was lower than the VN Index, which fell about 50% as well.
Binh Chanh construction investment firm reports first trading session
18/Mar/2009 Intellasia | 17/Mar/2009 Thoi Bao Kinh Te Vietnam page 7
Ho Chi Minh Stock Exchange (STC) on March 16 officially put 54.2 million BCI coded shares of Binh Chanh Construction Investment Joint Stock Co into transaction with a comparative price of 27,000 dong per share and the trading amplitude of +/-20%.
Ending the first trading session, BCI closed at 24,000 dong per share, down 3,000 dong/share against the comparative price with 243,240 shares changing hands.
The company has a chartered capital of 542 billion dong, headquartered at No 550 Kinh Duong Vuong, An Lac Ward, HCM City's Binh Tan Dist.
SSI continues buying 330,000 PAN coded shares
18/Mar/2009 Intellasia | CafeF
Top broker Saigon Securities Inc (SSI) reported registered to buy extra 331,300 PAN coded shares of Pan Pacific Joint Stock Co between March 18 and April 18, 2009.
Earlier, SSI purchased 368,700 PAN shares, bringing its size in PAN to 5.268%.
After the registered transaction finishes, SSI's holding in PAN will be 700,050 shares or 10%.
DB Schenker opens Vietnam logistics centre
18/Mar/2009 Intellasia | Ci-online
Schenker Vietnam on March 17 opened its 10,000 square metre flagship facility in Song Than Industrial Park I of Binh Duong Province, close to HCM City.
The facility is the product of a US$5.5 million investment with Vietnamese partner Gemadept. Schenker plans to create a key logistics hub for manufacturers and distributors in local high-tech and industrial zones.
"More than ever, this facility will not only serve as an important hub for the Vietnam market, but will also be an integral hub in our regional and global network, as we continue to strengthen our logistics footprint to better serve our customers needs in Vietnam, Asia Pacific and the rest of the world," said CEO Steve Dearnley.
DB Schenker is the Germany's leading provider of warehouse and logistic services with a yearly revenue of 18 billion euro (about US$23.5 billion). The group first entered the Vietnam market in 1990.
Phu My Wasuco reaches EPS of 3,236 dong
18/Mar/2009 Intellasia | Dau Tu Chung Khoan page 17
Phu My Water Supply Joint Stock Co (Phu My Wasuco) has released the 2008 business results with total revenue of 33.5 billion dong, a year-on-year rise of 21.46%, after-tax profit of 17.1 billion dong, up 15.57% and EPS of 3,236 dong/share against 2007's 3,061 dong.
In 2008, the firm paid a dividend of 25%, higher than the previous year's 29%.
Phu My Wasuco has a chartered capital of 52.892 billion dong, of which 28% is held by the state shareholders and its share capital surplus was 4.4 billion dong.
Binh Dinh Agricultural Co '08 net revenue at 779b dong
18/Mar/2009 Intellasia | Dau Tu Chung Khoan page 17
Binh Dinh Agricultural Materials and Technique Joint Stock Co (ATM) reported that last year it earned 778.9 billion dong in net revenue from sales and service provision, 20.2 billion dong in total after-tax profit, and EPS of 7,028 dong, growing by 46.08%, 188.57% and 66.3% correspondingly compared to 2007.
The company has a current chartered capital of 32.88 billion dong and the ownership capital of 48.1 billion dong, in which the big shareholder Binh Dinh Export Import Service Production and Investment Corp holds over 57%.
Laos, Vietnam sign joint mining deal
18/Mar/2009 Intellasia | VNA | Vietnam+
Representatives from Laos and Vietnam's government on Monday signed a cooperation agreement of mining minerals in Sepone, Laos' Savanakhet province.
Vietnamese representatives included Pham Minh Thao-chair of Laos Vietnam Natural Mineral Mining International Joint Venture Co, Tung Bach Joint Stock Co, Defense Ministry's Co 319, and others.
The project will be conducted on a large area in Savanakhet.
TigerInvest transfers Hoa Binh Tower
18/Mar/2009 Intellasia | Dau Tu Chung Khoan page 6
Being as a broker and consultant, Vietnam Finance Investment Co (TigerInvest) successfully transferred Hoa Binh Real Estate Construction and Trading Joint Stock Co's (HBC) Hoa Binh Tower project.
Particularly, HBC signed a contract of transferring the land using right of Hoa Binh Tower project designed on a site of 2,775 square metres at Lot C17-1-1, Zone A, HCM City's Southern Saigon Urban Area. Total value of the transfer contract is nearly US$12 million.
TigerInvest specialises in supplying M&A package services, especially in real estate field.
Da Nang to open six high-class coastal tourism sites
18/Mar/2009 Intellasia | CafeF
Da Nang City Department of Culture, Sport and Tourism on March 16 reported that through tourism project surveys, there would be extra six high class coastal tourism areas put into operation for the first phase between now to the year end.
The tourism area projects include Ba Na. Silver Shore-Hoang Dat, Olalani, Tien Sa, Xuan Thieu and Son Tra Spa.
In 2008, in Da Nang, four high-quality hotels with 295 rooms were operational, especially the Green Plaza five star hotel with 175 rooms.
The city now has 46 tourism investment projects worth total US$1.819 billion, including 12 foreign invested projects worth US$763 million and 34 domestic invested ones worth US$1.056 billion.
This year Da Nang targets to receive 1.33 million tourism arrivals, up 10% year-on-year, in which 950,000 arrivals are domestic, total revenue of 900 billion dong, a y-o-y growth of 11% and social earnings from tourism activities estimated at 2.340 trillion dong.
Japanese architectural designer sets up shop in Vietnam
18/Mar/2009 Intellasia | Thoi Bao Kinh Te Vietnam
Japanese architectural designer Kume Sekkei Groupon March 16 officially entered Vietnam through setting up/establishing Kume Design Asia arm in Hanoi and HCM City.
At the debut ceremony, Yukio Yamada, general director of Kume Sekkei spoke that Vietnam's real estate market especially the architectural design consultancy field remains at high potential so his firm decided to set up shops here.
The group wants to help Vietnam become "one international standardised-architectural design site" focusing on developing urban areas in Asia's neighbouring countries, Middle East and northern Africa, he added.
Formed in 1932, Tokya headquartered group to date has designed 6,000 projects in Japan and 40 other nations.
Vietnam needs to 'accelerate' infrastructure projects: ADB
18/Mar/2009 Intellasia | Thanhniennews
Vietnam needs to prioritise and "accelerate" its infrastructure projects, as it has ambitious plans to build power plants, ports, roads and railways in a period when financial resources are squeezed globally, ADB said.
Even with a global credit crunch and recession in many countries, there is money available to Vietnam from governments, international agencies and the private sector, said Ayumi Konishi, the Asian Development Bank's country director in Hanoi.
Vietnam "cannot do everything on its own and at once," Konishi said, noting that foreign companies would be deterred if they have to deal with power outages and transport bottlenecks.
Government officials have said about US$6 billion of stimulus spending will be budgeted this year, without specifying how it will be allocated or how much may have been in previous plans. The economy expanded 6.2% last year, the least in nine-years, as consumers in the US, Japan and Europe reined in spending.
Vietnam, a nation of 86 million with an US$85 billion economy, last month unveiled a plan to build a 1,555-kilometer high-speed rail from Hanoi, its capital, south to the economic hub of HCM City. That project would cost US$55.8 billion, according to Nguyen Huu Bang, chair and chief executive officer of state-owned Vietnam Railways.
"The high-speed rail is crucial for Vietnam," Bang said at the Asia Pacific Rail 2009 conference in Hanoi last week. The railway would have two stages completed by 2019 and the final two in 2035, he said.
When complete, travel time between Hanoi and HCM City will be about five-and-a-half hours, from 36 hours now, Bang said. Vietnam would consider technologies used in Japan's Shinkansen, Germany's Inter-City, and France's TGV rail system, he said.
Vietnam's north-south railway was built by the French between 1882 and 1936.
Konishi spoke at the event, where companies such as Alstom SA, Alcatel-Lucent UK Ltd, and Singapore's SMRT Corp made presentations on their transit products and services.
"There is a real competition here," Dominique Pouliquen, senior vice president for Alstom Transport Asia Pacific and country president for Alstom Singapore, said in an interview in Hanoi. "However, there is enough space regarding the number of opportunities in Vietnam."
Cat Lai port new wharf put operation
18/Mar/2009 Intellasia | 17/Mar/2009 CafeF
Tan Cang (New Port) Saigon Co on March 16 inaugurated the wharf No 7 in HCM City's Dist 2. The firm's deputy general director said that the new wharf would lift the cargo loading capacity of Cat Lai port to 350,000 teus (or 4.5 million tonnes of cargo) a year.
Saigon New Port Co now manages three ports including Tan Cang, Tan Cang Cat Lai and Tan Cang-Cai Mep. The cargo loading capacity through Tan Cang Cat Lai port reached over 27 million tonnes last year for the revenue of nearly three trillion dong.
My Thuy deep water seaport project approved
18/Mar/2009 Intellasia | 17/Mar/2009 Thoi Bao Kinh Te Saigon Online
My Thuy deep water seaport project with a total investment capital of eight trillion dong for the first phase was recently approved by the Quang Tri provincial People's Committee.
The seaport with 3,090 metres in length will be built in communes of Hai An and Hai Khe in Hai Lang district by Maritime Construction Investment Joint Stock Co under Vietnam Maritime Corp (Vinalines).
Last month, Malaysia-based Giant Group Limited (GGL) signed a memorandum of understanding with Quang Tri provincial People's Committee to carry out feasible study for the project.
