GAO CENTER

Vietnam stocks: up on Vinamilk issue, new listings

2006-11-19T00:29:00.000-08:00

The VN Index on the Ho Chi Minh City Securities Trading Center closed at 573.79 points, bringing its gains so far in 2006 to nearly 87 percent, making it the best performing index in Asia so far this year.

US President George W. Bush, who arrived in Hanoi on Friday to attend the Asia Pacific Economic Cooperation summit this weekend, is scheduled to visit the six-year-old exchange on Monday during a trip to Ho Chi Minh City, formerly Saigon.

Vinamilk, Vietnam's largest listed firm, will issue 18,050,475 shares in three phases and use the proceeds "to raise investment, expand production and business and restructure the firm's finance", the State Securities Commission said late on Thursday.

Vinamilk shares rose VND3,500, or 3.87 percent, to VND94,000 ($5.85) on Friday, giving the firm a market value of $830 million, or 22 percent of the Ho Chi Minh City stock market capitalisation of $3.73 billion.

The State Securities Commission did not say how much Vinamilk planned to raise, but at current market prices its issue could bring in around $100 million.

The Ho Chi Minh City stock market is expected to see the debuts of at least 15 companies between now and the end of the year while a dozen more have sought licences to list.

Petrovietnam Drilling and Well Services Co, or PV Drilling, which has a market value of $262 million, said on Friday it had been given permission to list all its 68 million shares on Dec. 5.

Last year, shares in PV Drilling, the drilling arm of state oil monopoly Petrovietnam, surged more than 30 percent at their initial public offering as investors sought to invest in the fast-growing energy sector.

The sector has grown rapidly in recent years along with the economy, the world's fastest growing after China.

Vietnam's GDP growth is forecast to accelerate to 8.2 percent to 8.5 percent next year from 8.2 percent estimated for 2006.

Crude oil is its largest foreign exchange earner and Vietnam is the third-biggest crude producer in Southeast Asia.

In Hanoi, the small over-the-counter market is expected to double in size on Tuesday with the debut of Asia Commercial Bank (ACB), the country's fifth-largest bank valued on unofficial markets at $737 million.

ACB, the biggest of Vietnam's more than 30 equitized banks with assets of $2.5 billion last month, is set to become its second listed bank after Sacombank , which made its debut in Ho Chi Minh City in July.

Vietnam's main share index rose 2.49 percent on Friday after the country's largest listed firm won approval for a major share issue and as investors awaited a flood of new listings.
TNnews 11/17/06

China, Vietnam agree to enhance friendly ties, overall cooperation

2006-11-19T00:10:00.000-08:00

China and Vietnam have agreed to enhance good-neighborly and friendly ties and overall cooperation, said a joint declaration issued by the two countries on Friday.

In the declaration, the two sides expressed satisfaction with the ever-reinforcing ties between the two parties and countries, adding that China and Vietnam share strategic interests over many major issues.

Under an international situation that is undergoing profound changes, enhancing the Sino-Vietnam good-neighborly and friendly ties and comprehensive cooperation is in the fundamental interests of the two parties, countries and peoples, and conducive to peace and development in the region and the world as a whole, the declaration said.

According to the declaration, issued during Chinese President Hu Jintao's visit to Vietnam, the two sides agree to enhance high-level exchanges of visits and expand pragmatic cooperation in economy and trade, technology and science, education and culture.

The two countries will be committed to the principle of "friendly neighborliness, comprehensive cooperation, long-term stability, future orientation" and the four-good spirit -- good neighbors, good friends, good comrades and good partners -- in their relationship development, the declaration said.

Hu is in Vietnam for a state visit and has held talks with General Secretary of the Central Committee of the Communist Party of Vietnam Nong Duc Manh, President Nguyen Minh Triet, Prime Minister Nguyen Tan Dung and National Assembly Chairman Nguyen Phu Trong.

In the declaration, the two sides also expressed satisfaction over their cooperation in regional and international affairs, reaffirming willingness to continue to enhance their coordination and to work together to safeguard and promote peace, stability and development in the region and the world at large.

They also called on the United Nations to play a bigger role in meeting the new challenges and threats, safeguarding peace and security of the world and promoting common development of its member states.

China also expresses its support for Vietnam in its bid for the non-permanent membership of the UN Security Council in 2008-2009.

In the declaration, Vietnam also reiterates its adherence to the one-China policy and its support for China's Anti-Secession Law.

Reaffirming its firm opposition to "Taiwan independence" and pledging not to have official ties with Taiwan, Vietnam said it hopes to see an early reunification of China, according to the declaration.

Vietnam is the first leg of Hu's four-nation tour, which will also take him to Laos, India and Pakistan.

Source: Xinhua 11/18/06

Editorial - Houston Chronicle Unfair trade

2006-11-19T00:08:00.000-08:00

Unfair trade
Congress' vote against a speedy trade agreement with Vietnam shows politics trumping the national good

When Congress failed to pass a measure to fast-track trade normalization with Vietnam, it robbed the visiting President Bush of a timely gift to his hosts in Vietnam. It also revealed an unwise tradeoff at home: protectionist pandering deprived the United States of a foreign policy tool.

To Republicans' chagrin, the House of Representatives this week failed to deliver the two-thirds majority that would have let normalization move quickly into law. Lawmakers have now postponed the vote until December.

Too bad: President Bush was correct in calling for starting permanent normal trade relations for the first time in 30 years. Such a measure, he argued, would encourage Vietnam's government to open up to private investment.

The good news is that Democrats and Republicans in Congress both predict this measure ultimately will pass. The bad news: This sound idea was sabotaged by misplaced protectionism, not to mention Democratic pique against a lame-duck president. If continued, those trends may prove more damaging for the United States than any short-term delay in normalizing trade means for Vietnam.

Country-by-country trade deals such as this one, many economists say, don't really wield much economic impact on the United States. "The United States allows almost full access to our markets," said economist Barry Bosworth of the Brookings Institution in Washington, D.C. "If other countries don't open up, it's their loss."

But normalizing trade would have considerable effect as a foreign policy tool. It gives foreign investors to Vietnam more confidence in the country's stability. For Vietnam, meanwhile, any liberalization, even minimal, will help its economy. Crucially, it also strengthens the foundation for democratic governance there.

Although Vietnam's economy is still heavily shaped by the government, the country will have to improve its transparency, rule of law and legal system if it wants to take advantage of foreign investors' interest there.

For the United States, trade liberalization will always have winners and losers. Often, the losers tend to be workers. Yet trade is only part of the equation that determines job stability in this country. Our wage structure, pension portability and above all our health care inefficiency are several of the weakest spots in job security.

Vietnam, which has joined the World Trade Organization, can expect to normalize trade with America soon. But in slowing down that process, protectionists on both sides of the aisle robbed the president of a useful diplomatic tool. That's a poor tradeoff for the United States.

Houston Chronicle 11/17/06

All online game operators in Vietnam hub fined, games banned

2006-11-17T01:01:00.000-08:00

The Department of Posts and Telematics fined the six VTC Intercom, VinaGame, VDC, Asia Soft, Cyberworld Corporation, and FPT Telecom VND15-VND20 million each (up to US$1,250).

Three of the games they provide, Legend of Three Kingdoms Online, Silkroad Online, and Nine Dragons, are to be shut down by December 1.

The 10 others, including Space Cowboy, Swordsman Online, Ragnarok, Gunbound, MU, and PTV are to be stopped by January 1.

The companies were penalized for lacking certificates either from the Ministry of Posts and Telematics or from the Ministry of Culture and Information, the department said.

Game providers seek licenses in vain

Pham Thanh Duc, deputy director of FPT Telecom, said earlier he had applied to the culture ministry for a censorship certificate last July but the ministry had rejected the application.

He had submitted it for a second time last month and was waiting since, he said.

VinaGame chairman Le Hong Minh said the culture ministry had issued censorship certificates for all his companys games but they lacked technical certification from the post and telematics ministry.

VinaGame had applied for them last September but had received no reply yet, Minh told Thanh Nien newspaper earlier this month.

In one fell swoop, Ho Chi Minh City authorities fined all six online game operators in the city and banned all 13 games they have been providing for lack of permits and other papers.
TNnews 11/17/06

Vietnam approves Posco's plan to invest $361 million in steel plant

2006-11-16T18:23:00.000-08:00

HANOI (MarketWatch 11/16/06) -- Vietnamese Prime Minister Nguyen Tan Dung has agreed to allow South Korea's Posco (PKX) to invest $361 million to build a steel plant in Ba Ria-Vung Tau province, a government official said Thursday.

The world's fifth-largest steel maker by output will be the sole owner of the plant, which will be built 100 kilometers east of Ho Chi Minh City.

The plant will have a production capacity of 700,000 metric tons of cold-rolled steel products a year, said the official from the Ministry of Planning & Investment.

"The ministry will issue an investment license soon, and Posco is expected to start operating the plant by the end of 2009," the official told Dow Jones Newswires.

In 2005, Vietnam produced 3.66 million tons of steel products, of which 1.2 million tons were cold-rolled steel.

However, the country's demand for cold-rolled steel far exceeded domestic output, resulting in 3.35 million tons of cold-rolled steel product imports.

Last month, Posco said it was considering expanding the capacity of the soon-to-be-built plant to 1.5 million tons after 2009.

The company also plans to build a 3-million-ton hot-rolled steel plant in Vietnam from 2010, according to Vietnamese state media.

Posco officials weren't immediately available for comment.

Vietnam's Growth to Be a Focus of Summit

2006-11-16T07:21:00.000-08:00

Vietnam's Booming Economy to Be in Spotlight at 
Pacific Rim CEO Summit

 HANOI, Vietnam (AP 11/16/06) -- Vietnam's booming economy will be in the  spotlight when 1,200 business 
executives from corporations around the  Pacific Rim descend on Hanoi on 
Friday for three days of speeches,  seminars and hobnobbing.
  
  
The annual CEO Summit of the Asia-Pacific Economic Cooperation  forum, 
which overlaps with the APEC leaders' weekend gathering, will  address 
issues such as attracting foreign direct investment, security  threats 
and how to revive stalled world trade talks.

Delegates will hear from nine leaders of APEC's 21 member economies, according to a preliminary program, as well as top executives from multinational corporations such as HSBC, Sinopec Corp. and Qualcomm Inc.

There is sure to be plenty of talk about Asia's dynamic economic growth, but host nation Vietnam and its dramatic development will likely grab m uch of the attention.

In fortuitous timing, the CEO gathering comes fresh on the heels of two of the biggest business developments to hit Vietnam in years -- its approval for membership in the World Trade Organization and Intel Corp.'s announcement last week that it will invest $1 billion in a chip plant in Ho Chi Minh City.

Foreign investment is surging, authorities are accelerating market reforms and economic growth has been racing ahead at a remarkable 7.5 percent pace.

Vietnam's fledgling stock market -- just 52 listed companies and growing rapidly -- has seen its overall value increase tenfold in less than a year.

"We see our customers coming to Vietnam, and that's one of the drivers for us coming here," said Chris Rooney, a senior vice president at AT&T Inc., who will be participating in a panel discussion at the gathering.

This week, AT&T said it has expanded its global networking servic es for multinational companies to Vietnam through an agreement with Viettel Corp., a government-owned telecommunications company.

Just about the only recent disappointment for Vietnam was the U.S. House of Representative's rejection on Tuesday of a bill to permanently normalize trade relations. Approval of the bill is required for American businesses to take full advantage of Vietnam's entry into the WTO, which is officially expected to occur next month.

But Susan Schwab, the top U.S. trade negotiator who is also in Hanoi for APEC, expressed confidence that the bill will pass next month.

Still, business executives point out that Vietnam faces plenty of challenges as it seeks to integrate into the world economy.

Than Trong Phuc, Intel's country manager for Vietnam, Laos and Cambodia, said Vietnam needs to invest in training more engineers and make its university education more practical and less theoretical.

"We would like to work with the government to develop a pipeline to encourage more students to get technical training," Phuc said in a panel discussion Thursday sponsored by Vietnam Chamber of Commerce and Industry.

The CEO summit kicks off Friday morning with a welcome from Vietnamese President Nguyen Minh Triet, followed by a panel discussing the state of the world economy and what's needed to revive World Trade Organization talks that broke down in July.

Members of that panel include Supachai Panitchpakdi, the former head of the WTO, HSBC CEO Michael Smith, PetroVietnam Vice President Do Van Hau and Nick Reilly, president of General Motors Asia Pacific.

Vietnam's Economy Making Strides

2006-11-16T07:19:00.000-08:00

Vietnam's Economy Making Progress but Held Back by 
Lack of Infrastructure, Tech Training

HANOI, Vietnam (AP 11/16/06) -- Vietnam's economy is making impressive strides,  but is 
still encumbered by obstacles such as poor port facilities, a  dearth of 
highly trained engineers and a university system that doesn't  do 
enough to reward innovation, experts said Thursday.
  
Intel Corp., which just last week said it was investing $1 billion  in a chip plant 
in Ho Chi Minh City, would like the government to  invest more in 
technical training, said Than Trong Phuc, Intel's  country manager for 
Vietnam, Laos and Cambodia.  

"There are more  students that go into business and marketing and finance than technical   studies. We would like 
to work with the government to develop a  pipeline to encourage more 
students to get technical training," Phuc  said during a panel discussion 
on "Doing Business with Vietnam"  sponsored by the Vietnam  Chamb
 er of Commerce and Industry.
  "This  is understandable because Vietnam does not yet have a high-tech market  that will employ 
these students. But we are here and we are willing to  help develop this 
pipeline," he said during the seminar, held on the  sidelines of the 
Asia-Pacific Economic Cooperation forum.
  Intel  also wants to work with universities and the Ministry of Education to  modernize the 
curriculum to include more courses that emphasize  hands-on experience 
and rely less on theory, Phuc said.
  Vietnam's  economy is expected to expand by 8.2  percent this year, the highest  rate in 
Southeast Asia, and government authorities have accelerated  market 
reforms.
  But the country needs to develop a "culture of  innovation," 
particularly at the university level, said Jonathan  Pincus, senior 
country economist with the U.N. Development Program.
  Vietnam needs "universities that reward excellence, universities  that res
 pond  more quickly to demand from industry for innovation, 
universities that  have more autonomy that reward researchers for creativity and  
initiative," Pincus said.
  Vietnam's approval for membership in  the World Trade Organization last week will help make it "one of 
the  most open economies in the entire region," said Christoph Wiesner, a  
member of the European Commission's delegation.
  But the country's  still-developing infrastructure "is an obstacle to investors," 
he said.
  "Ports  are one major headache. Despite some improvements, it takes too long to  ship a container to main overseas 
destinations and it's quite a bit  more expensive than elsewhere in the 
region," Wiesner said.
  Intel's Phuc also said a better command of English would help workers in the technology industry.
  
"When employees have a good idea, but cannot sell the idea within the team 
or within the company, that's very key," he  said.

Japanese business mission to visit Vietnam with PM

2006-11-16T06:39:00.000-08:00

TOKYO, Nov 16 (Reuters) - When Japanese Prime Minister Shinzo Abe visits Vietnam from Friday for a Pacific leaders meeting, a business delegation more than 100 strong will go with him in a rare move for a Japanese leader.

The 134-person delegation will be led by Fujio Mitarai, the head of Japan's biggest business lobby, the Japan Business Federation (Keidanren), who is also chairman of Canon Inc. .

Other key members include top personnel from such firms as Sony and Toshiba as well as several regional electric power companies.

Japanese Chief Cabinet Secretary Yasuhisa Shiozaki said the mission aimed at deepening ties in a wide range of fields, adding that a similar delegation had accompanied Vietnamese Prime Minister Nguyen Tan Dung to Japan earlier this year.

"We don't see Vietnam just as a market, but as a nation with which we want warmer ties in a number of fields," Shiozaki told a news conference on Thursday.

Last year, Japan was the No. 2 destination for Vietnamese exports after the United States, at $4.4 billion, according to the Japan External Trade Organization.

HSBC sells $12 mln Vietnam credit linked note

2006-11-16T06:38:00.001-08:00

HONG KONG, Nov 16 (Reuters) - HSBC has sold a five-year note linked to the credit risk of BB rated Vietnam and its dong currency -- the first such note linked to the fast-growing country's domestic interest rates, the bank said on Thursday.

The return on the credit linked note (CLN) is linked to the yield on the five-year Vietnam government bond and the initial coupon on the bond is 8.38 percent.

The instrument allows global investors to gain exposure to Vietnamese interest rate and currency risks without them having to set up custodian accounts.

Marubeni,Dongfang Elec to build Vietnam power plant

2006-11-16T06:38:00.000-08:00

TOKYO, Nov 16 (Reuters) - Japanese trading house Marubeni Corp. said on Thursday it and Chinese partner Dongfang Electric Corp. have won a $460 million contract to build a coal-fired power plant in Vietnam.

Marubeni, Japan's fifth-biggest trading company, will partner with China's biggest heavy machinery maker, to build a 600 megawatt plant adjacent to another plant of the same size that the two firms are building for a government-owned company.

Construction will start in early 2007.

It will be Marubeni's eighth power plant project in Vietnam.

The contract price relates to the construction of the plant, though not to actual power generation.

Marubeni has built seven power generation plants in Vietnam with a total generation capacity of 2,400 megawatts, about 20 percent of the country's total power capacity, Marubeni said in a statement.

Demand for electricity in Vietnam grew more than 15 percent annually between 2003 and 2005.

Marubeni is one of the biggest Japanese trading houses involved in power generation projects in Asia. A consortium led by Marubeni last month won a $2.3 billion contract to build and operate a natural gas power plant in Qatar that can generate 2,000 megawatts, big enough to power 600,000 homes.

Shares in Marubeni finished up 0.18 percent at 572 yen, outperforming a 0.49 percent fall in the benchmark Nikkei average . ($1=117.95 Yen)

Vietnam's Vinalines Forms $100 Million JV With SSA Marine

2006-11-16T06:37:00.000-08:00

HANOI -(Dow Jones 11/15/06)- State-owned Vietnam National Shipping Lines, or Vinalines, has signed an agreement to form a $100-million container terminal joint venture with Washington-based SSA Marine, a Vinalines official said Thursday.

The joint venture will build three large wharves at Cai Lan port, about 200 kilometers east of Hanoi, said Bui Van Chung, director of Vinalines' international business department.

"This is the first joint venture formed with a U.S. company to build a Vietnamese port. It is expected to become operational in 2008," Chung told Dow Jones Newswires.

The agreement was signed on the sidelines of the Asia-Pacific Economic Cooperation forum being hosted in Hanoi, and was witnessed by Vietnamese Prime Minister Nguyen Tan Dung.

Vinalines will contribute 51% of total funding for the facility, with SSA Marine providing the balance. The joint venture has a 50-year operating license, Chung said.

"Vietnam needs to improve its infrastructure to facilitate exports," he added.

Vinalines plans to raise VND51 trillion ($3.2 billion) between 2006 and 2010 to invest in its shipping fleet and upgrade its ports.

In the first half of this year, Vinalines reported a net profit of $13.4 million on revenue of $327 million, down 34% on year in profit terms, but up 4% in revenue terms.

US assures Vietnam it will soon normalize trade ties

2006-11-16T06:36:00.000-08:00

ABOARD AIR FORCE ONE (AFP 11/15/06) - The United States assured Vietnam it would quickly normalize trade ties, days after Congress failed to pass such a bill in time for President George W. Bush's arrival there for a regional summit.

"It is unfortunate that it could not have been done before the president arrived, but I think the message for the Vietnamese people will be, 'this is going to get done,'" Bush's national security advisor Steve Hadley told reporters on Air Force One taking the president to Asia.

Hadley said the White House believed there were majorities in both the House of Representatives and the Senate to back "permanent normal trade relations" (PNTR) to Vietnam.

Bush and the Hanoi leadership had hoped the House and Senate would approve PNTR with the communist nation before Bush arrives in Hanoi Friday for an Asia-Pacific Economic Cooperation ( APEC) summit.

The bill would grant full US trading rights not subject to annual review to Vietnam, a fast-emerging economy that is expected to become the 150th member of the World Trade Organisation (WTO) before the end of the year.

It would also ensure that US companies enjoy full market access under Vietnam's WTO accession as they seek to step up business in the country of 84 million people, which has Southeast Asia's highest economic growth rate.

"This is a clear priority for the administration, and we are confident that ultimately PNTR will be passed for Vietnam," US Trade Representative Susan Schwab told a briefing in Hanoi.

"The Bush administration and the leadership in the Congress -- Republican and Democrat -- are clearly committed to enact Permanent Normal Trade Relations for Vietnam when Vietnam joins the World Trade Organisation."

Washington and Hanoi have worked hard to make Bush's visit a success, with Vietnam expelling a jailed US dissident last week and the United States taking Vietnam off a blacklist of countries repressing religious freedom.

Schwab said Monday's vote had failed because the procedure used required a two-thirds majority at a time when many legislators were absent following the mid-term elections, in which Democrats took both chambers in a landslide.

When the US legislature reconvenes in early December, Schwab said, "we would expect Congress to take up PNTR in both houses of Congress under normal procedures," requiring only a simple majority for the draft to pass.

"We will continue to press very hard to see that enactment takes place before Vietnam actually joins the WTO," she said.

Bush goes East

2006-11-15T19:48:00.000-08:00

Bush goes East

Wednesday 11/15/06

Moscow - Met with President Vladimir Putin.

Thursday 11/16/06

Singapore - Meets with the prime minister.

Friday 11/07/06

Hanoi, Vietnam - Meets with the prime minister of Australia; meets with top Vietnamese leaders.

Nov. 18

Hanoi, Vietnam - Meets with the president of the Republic of Korea; attends the Asia-Pacific Economic Cooperation meeting (through Nov. 19).

Nov. 19

Hanoi, Vietnam - Meets with the president of China; meets with the president of Russia.

Nov. 20

Ho Chi Minh City, Vietnam - Participates in round table with business leaders; participates in a briefing on HIV/AIDS and avian influenza.

Bogor, Indonesia - Meets with the president of Indonesia.

Nov. 21

Honolulu - Participates in a breakfast with US troops.

- Reuters

Russia's leading bank to expand to Vietnam

2006-11-15T19:00:00.000-08:00

Yulia Chulina, a member of the VTB Management Board, said at a seminar on Vietnam-Russia economic cooperation in Moscow that Vietnam's economy was growing well with a lot of potential for the banking sector.

The seminar, hosted by the Vietnamese Embassy in Russia, also aims to introduce the Vietnam-Russia Bank (VRB), which is a joint venture between the VTB and the Bank for Investment and Development of Vietnam (BIDV).

The VRB is scheduled to become operational by November 19 with the opening of an office in Hanoi.

The event expects to draw the presence of the two countries' top leaders, President Nguyen Minh Triet and President Vladimir Putin, who will visit Vietnam to attend an Asia-Pacific Economic Cooperation (APEC) summit meeting.

The Russian Bank for Foreign Trade (VTB), which will launch a joint venture in Hanoi next week, considers Vietnam an important part of its expansion plans in Asia, a bank representative said Tuesday.

TNnews 11/15/06

Behind Congress's delay of Vietnam trade vote

2006-11-15T18:59:00.000-08:00

Postponement of a decision on Vietnam's trade status reveals concern over the growth of free-trade pacts.

NEW YORK US pork producers foresee a boom if the United States adds Vietnam to its list of countries that enjoy permanent normal trade relations.

Other companies ranging from Harley-Davidson to Citigroup are also eager to gain access to one of the world's most vibrant developing economies.

But they will have to learn an Asian virtue - patience - because Congress this week postponed a vote that would have added Vietnam to the list of nations enjoying this trade status. The delay was an embarrassment to the White House since President Bush is on his way to Vietnam for an Asian summit meeting and would have touted the benefits of a completed pact. Now, most analysts anticipate Congress will vote on it next month.

Behind the delay is an underlying concern, reflected in the election results, over the growth of free-trade pacts. Politicians are once again focusing on the giant US trade deficit, now at about $684 billion this year and growing. One particular area of concern is China: Trade analysts anticipate the administration will be under pressure to get results in its negotiations with Beijing over revaluing its currency.

"In terms of protectionism, we appear to be tilting that way," says Clayton Yeutter, a former US trade representative. "In terms of the US-China relationship, I think the patience has worn thin."

The Vietnam vote may indicate how hard it will be to pass any trade legislation next year. For one thing, trade analysts doubt Mr. Bush can win approval for an extension of fast-track authority (which means Congress can vote only up or down on a trade pact).

Several bilateral trade agreements, for such countries as Peru and South Korea, may also be in trouble. For example, the US wants to add rice to the South Korean negotiations, says Ben Carliner, director of research at the Economic Strategy Institute in Washington. Rice has been a sticking point in past negotiations with Asian nations.

"If we were to get the Korean trade pact through, it would put a lot of pressure on Japan since they now compete with Korea very strongly in electronics and autos," says Mr. Carliner. "It would give a big advantage to Korea."

If the Bush completes the negotiations, he would have to make a major push to get Congress to approve them. "A lot of members of Congress don't want to vote for anything that speaks to trade liberalization," says Mr. Yeutter.

In fact, business interests who are in favor of the Vietnam bill point out that it wouldn't lower tariffs for Vietnam. "This is removing tariffs in Vietnam for us and other [World Trade Organization] countries," says Christopher Wenk, director of international trade at the National Association of Manufacturers in Washington.

US pork producers are particularly eager to gain access to Vietnam. Vietnamese cuisine uses parts of the hog that are not of great interest to Americans. A study has found that the sale of these parts would add about 52 cents a hog to profits over 10 years, according to Nick Giordano of the National Pork Producers Council. "That's a significant increase in profit," he says.

Despite such profit prospects, the Bush administration has had to work hard to get elected officials in the South on board because of concerns about large surges of textile and apparel imports from Vietnam. The US has an estimated $5.7 billion trade deficit with the Asian nation, and most of it is from textiles.

Christian Science Monitor 11/16/06

APEC members count Vietnam advantages

2006-11-15T18:57:00.000-08:00

Sachio Kageyama, general director of Canon Vietnam, told the forum that Vietnam had abundant human resources and skilled labor.

They are well-trained, creative, and good at English, he said.

Many workers catch up after only two weeks of training. Particularly, they can work with extreme precision.

Canon decided to enlarge its investment in Vietnam not only due to the incentives offered by the Vietnamese government but also because of the sharp rise in the number of local suppliers and vastly improved infrastructure, he said.

David Knapp, president of the American Chamber of Commerce in Vietnam, said the nation had an advantageous geographical and political position.

As a new World Trade Organization member with a stable socio-political situation and good business opportunities, Vietnam would become more attractive to US investors, he said.

An official from Thailand admitted that Vietnam had advantages compared to his country, especially in low investment-related costs as mentioned in a recent survey by the United Nations Conference on Trade and Development (UNCTAD).

An UNCTAD official, Hafiz Mirza, said Vietnams prospects of attracting FDI had become brighter after its WTO accession.

What it should do was restructure and give priority to sharpening its strong points to attract further FDI from the Asia Pacific region and elsewhere, he said.

Kenjiro Ishiwata, head of the Japan External Trade Organization office in Hanoi, said more Japanese investors had rushed to Vietnam recently, creating a second wave of investment from Japan into Vietnam.

Besides services I think more manufacturers too would come to Vietnam, he said.


Mr. Kenjiro Ishiwata, head of the Japan External Trade Organization office in Hanoi

Low costs and a skilled workforce give Vietnam an edge over many other APEC member economies in attracting foreign investment, the APEC investment forum heard in Hanoi Wednesday.
TNnews 11/15/06

US company mulls $1 bln tourist project in Vietnam island

2006-11-15T18:56:00.000-08:00

The island, which is part of Kien Giang province, is 300 kilometers west of Ho Chi Minh City.

"Rockingham Corp. is looking at building various tourist facilities on the island between 2006 and 2015," Thai Dac Liet, director of Kien Giang province's investment and planning department, told Dow Jones Newswires.

Liet said that Nevada-based Rockingham was studying local investment conditions and would submit a formal application for the project later.

He didn't elaborate on when this might happen.

He noted that the development of projects on the island could be slow because the authorities haven't upgraded a local airport and the island lacks major infrastructure.

Local media reported that 150 foreign investors were applying for investment licenses to build tourism projects on Phu Quoc Island.

Dow Jones Newswire said Rockingham officials weren't immediately available for comment.

US-based Rockingham Corp. is considering investing up to US$1 billion in tourist projects on Phu Quoc Island in south Vietnam, a Vietnamese government official said Wednesday.
TNnews 11/15/06

AT&T expands corporate networking services to Vietnam in deal with local telecom

2006-11-15T18:55:00.000-08:00

HANOI, Vietnam: AT&T Inc. said Wednesday it has expanded its global networking services for multinational companies to Vietnam through an agreement with Viettel Corp., a telecommunications company run by the military.

The agreement will allow AT&T to use Viettel's domestic network to provide the same level of data delivery and communications service for its corporate clients in Vietnam as it does in more than 120 other nations around the world, AT&T executives said.

No financial terms of the contract, signed last week, were released.

"Our customers were coming to Vietnam because of the growth of the market here, and we were driven by that demand to find a good partner here," Chris Rooney, AT&T's senior vice president of worldwide customer service, said in an interview in Hanoi.

Rooney was in town to attend the Asia-Pacific Economic Cooperation forum's annual CEO Summit, which will bring to together 1,200 business executives starting Friday. The gathering overlaps with the APEC leader's meeting this weekend.

Viettel Corp. is also the holding company for Viettel Mobile, one of the country's six mobile phone carriers. Viettel Mobile is planning to sell shares to the public after receiving government approval earlier this year.

AT&T's corporate clients including Intel Corp. and General Motors Corp. of the U.S., Bluescope Steel Ltd. of Australia and Evergreen Marine Corp. of Taiwan.

International Herald Tribune 11/15/06

Vietnam miner, medicine firm get listing permits

2006-11-15T18:49:00.000-08:00

Hanoi-based Cavico Vietnam Mining and Construction Co. was licensed to list all its 3.1 million shares on the Ho Chi Minh City Securities Trading Center, the State Securities Commission (SSC) said in a statement on Wednesday.

It also said Ho Chi Minh City-based Imexpharm Pharmaceutical Co had been given permission to list 8.4 million shares.

The values of the two firms were not immediately available and they have yet to announce their debut dates.

In September, Cavico said it sold a 5 percent stake to a Vietnamese equitized bank at face value for VND1.55 billion ($96,500). The firm has a registered capital of $1.93 million.

Cavico and Imexpharm are among two dozen firms seeking to trade on the Ho Chi Minh City market, Asia's fastest rising bourse of 2006, by the end of the year to win tax relief.

In order to boost the capital market, the government has been offering two years of 50 percent corporate income tax relief to companies which make their market debuts by the end of 2006.

A race to meet the deadline has produced a rash of IPOs in recent months.

From Thursday to Dec. 21, seven companies are scheduled to make their debuts in Ho Chi Minh City and 10 more have permission to list but have not announced dates.

The VN index rose 1.32 percent to close at 563.77 points on Wednesday and is now up 83 percent so far this year, making it Asia's fastest rising index this year.

The six-year-old market now has 53 companies and a capitalisation of $3.6 billion, adding one debutant on Wednesday.

In May, Cavico Corp. began trading on the U.S. market for small pink-sheet stocks, the first Vietnamese firm to list overseas. It builds power plants and roads and operates coal mines in Vietnam.

Cavico Corp., with assets of $64 million, owns 50 percent of Cavico Vietnam Mining.

A mining company, half owned by Cavico Corp., Vietnam's first overseas-listed firm, and a pharmaceutical firm have been licensed to list shares on the country's main stock exchange, regulators said.

TNnews 11/15/06

Show Business With A Difference

2006-11-14T18:33:00.000-08:00

Chan Chao International is working hard to penetrate further into the exhibition business in Vietnam

When Tiger Lin came to Vietnam several years ago, he did not imagine that one day he would be involved in a different kind of business. As a construction engineer, he arrived in 1998 to cooperate with a company that specialized in building high-rises and apartments. However, he realized the great potential of the exhibition business here, and in 2001 persuaded his brother-in-law, who was chairman of Chan Chao International, an exhibition company in Taiwan, to let him set up a Vietnam branch.

Vietnam is a rapidly industrializing country and has great demand for machinery. Organizing industrial machinery exhibitions is a business of great potential, he said. Lin is now general manager of Chan Chao International and Yorkers Trade & Marketing Service, an exhibition marketing and service company based in Hong Kong.

Chan Chao has chosen Vietnam Advertising & Trade Fair National Company (Vinexad) to be its local partner as it has brought many Vietnamese businesses to Taiwan to participate in exhibitions and Chan Chao has established good relations with it.

Experience

Chan Chao is the second largest exhibition company in Taiwan after Taiwan External Trade Development Association (Taitra), with more than 20 years of experience. Besides its own exhibitions, Chan Chao cooperates with international exhibition companies to bring exhibitors to Vietnam. On average, the company organizes 25 international exhibitions a year in many countries. In Vietnam, it holds the Linkage Vietnam series of six exhibitions, with five in HCM City and one in Hanoi.

Lin said that in the first few years of operation, the company organized exhibitions of machinery in the textile, garment, woodwork, plastic and automation industries. Later, it widened the scope to include printing, packaging, information and communication technologies, and food processing. Though there are many exhibitions in the same fields in Vietnam, Chan Chao is able to attract exhibitors as its exhibitions have been successful. We usually attract exhibitors from at least 20 countries to join our exhibitions. Besides Taiwanese businesses, there are businesses from Europe and Asian countries, Lin said.

Chan Chaos exhibitions are becoming larger in scale because the theme of exhibitions is widened to meet exhibitors demand. Other international exhibition companies have visited Chan Chaos exhibitions, and appreciated its good organization and marketing expertise. Therefore they want to cooperate with the company. The exhibitions are becoming larger and more effective thanks to the cooperation and support from these partners, Lin said.

Organization

Lin said successful exhibitions require good organization, but the main factor is the state of the market. Before organizing an exhibition, the company studies the market very carefully to determine the theme of exhibition. We determine the theme based on the demand of each specific market. In Vietnam, we choose industry because it is a growing sector, he said.

Chan Chao does not organize exhibitions on themes where competition is stiff. Therefore, the company does not hold exhibitions on food and consumer goods, as these are held many times in a year by many companies. It focuses on industrial exhibitions, where it can attract international exhibitors.

Lin said the exhibition theme is important but so are demand and timing. He cited an example that in 1998 Chan Chao intended to hold an exhibition on some industrial machinery, but after learning that there was no demand for such machinery, it decided to delay the event to 2001 when there was real market demand. In recent years the company has focused on the woodwork industry, as many investors in regional countries have turned to Vietnam to set up factories to avoid the anti-dumping tariff in the U.S. Larger space

Lin noted that exhibition centers in Vietnam are not big enough to meet the need. The country should have large exhibition centers, he said. Because of the lack of such centers, Chan Chao has to hold smaller exhibitions. It plans to organize Linkage Vietnam 2006, an international industrial exhibition, in November, with the participation of an estimated 1,500 exhibitors. However, due to the lack of a large exhibition center, the company must divide it into five separate exhibitions. This will increase the cost for exhibitors, he said. Worse, they dont have a choice over which center to use and some large exhibition centers charge a lot for their services.

To solve the problem, Chan Chao plans to organize its exhibitions later this year in the new urban center of Phu My Hung instead of at the HCM City International Exhibition and Convention Center in Tan Binh District as before. Besides the limited space, traffic to the center is often jammed and many exhibitors are not satisfied with the service, Lin said.

Access to Phu My Hung now is easier, especially from industrial zones and ports. In July, the Ministry of Planning and Investment granted a license for the construction of an international exhibition center in Phu My Hung. The Saigon World Trade Center, a US$20-million joint venture between Saigontourist and Phu My Hung Corp., will cover 118,000 square meters with four exhibition halls, each with 12,000 square meters able to hold 1,500 booths. The project will also have an outdoor exhibition area of 20,000-25,000 square meters, a hotel, office tower and convention center.

Chan Chao will regularly hold exhibitions at the center after it is completed, expected in October next year. However, pending the completion of this large-scale project, the company will build a temporary exhibition center on an area of 12,000 square meters in Phu My Hung to serve its exhibitions. The center will be a pre-engineered building to be brought from Malaysia. It is used in international sports competitions and has international standard refrigeration and lighting systems. The building has been used for exhibitions in Pakistan and Bangladesh because there are no large exhibition centers there, Lin said. The assembly of the building will be finished in October, in time for the companys exhibitions.

Fresh goals

Lin said Chan Chao has plans to establish a company in Vietnam and is studying the market demand to make a final decision. One of the businesses it is aiming at for the immediate future is to gain the right of organizing and managing the new exhibition center in Phu My Hung. We have discussed this with Saigontourist and Phu My Hung. They are the owners of the project, while we have experience in organizing exhibitions, he said. Saigontourist and Phu My Hung may select the most suitable candidate for running the center through auction. At present, some companies are very keen on this undertaking. To maximize its advantage and chances of winning, Chan Chao plans to form an alliance with an exhibition company in Hong Kong.

Lin hopes that once there are large exhibition centers like that in Phu My Hung, the company will not have to hold small exhibitions and can combine them into a big one that is convenient for both exhibitors and visitors. The efficiency of the exhibition will also be greater, Lin said.

Saigon Times Weekly Issue No. 37 (780) 9/9/06

The Industry Land Dilemma

2006-11-14T18:30:00.000-08:00

Seeking land to set up production facilities proves to be a tough experience for businesses, as leasing land in industrial parks is expensive while buying land elsewhere is risky and neither procedure is fool-proof

Le Duy Tuong, director of a wood processing enterprise in HCM City, never imagined the wood processing factory he wanted to build would end up in Dong Nai Province. Three years ago, Tuong planned to develop the project in HCM City, where he had been operating for dozens of years. To seek land for the project, he aimed at industrial parks in the city, but was deterred by high rent, averaging US$0.9-1.1/square meter/year, in addition to other expenses like environment and greenery fees. These costs would make his investment inefficient.

Tuong then sought land outside industrial parks, but could not find one suitable to the scale of his project. Issues like zoning and compensation made him hesitant. In the end, he bought land in Trang Bom District, Dong Nai Province, as it is farmland with few inhabitants, easy to negotiate on compensation and purchase. Its still cheaper than land in industrial parks and we can sell the land when our project is finished, he said. Tuong paid a total of VND2.6 billion for the three-hectare land plot.

Cao Tien Vi, director of Saigon Paper, said that when seeking land for factory construction, investors should first determine the goal, strategy and scale of the investment before choosing a suitable location. The investment should also be planned beforehand. Investors should not wait until they have a demand for land, as they could easily run into time trouble, Vi said.

He said small businesses that have operations with little effect on the environment do not usually think much about a location, as long as it is convenient for their operations. However, they may have to relocate their operations later if they dont have proper information on zoning or the larger scale of their operations, as their chosen location may one day be no longer suitable. Investors should not miss Vis advice, as it comes from his bitter experience with land.

In 1997, Vi set up Saigon Paper Company and built a paper factory in Go Vap District, HCM City. He felt safe about the land because authorities said it was zoned for industrial operations. However, seven years later, he was informed that the land would be zoned for residential purpose and he had to relocate his operation. He did not receive relocation support fees because the land was leased, not in his ownership.

In 2004, Vi built a new paper factory in My Xuan A Industrial Park in Ba Ria-Vung Tau Province. At that time, the park had just completed infrastructure construction and there were not many factories there. However, Vi thought that he had considered the move carefully. Compared with industrial parks in other localities like HCM City, Binh Duong and Dong Nai provinces, My Xuan A had a lower land rent by 30%. Enterprises can enjoy tax exemption and reduction in the first seven years and pay only 15% in the following years.

He admitted that for the time being, his new location is not favorable for transport of materials and goods. However, things will change in the future when seaports and expressways will be built, which will make transport easier. He also expects that his paper packaging will find a wider market when industry in neighboring localities grows and more businesses create demand.

Where to look

Nguyen Thi Cam Van, head of the HCM City Department of Natural Resources and Environments planning and general office, said HCM City authorities are very keen on creating a land fund to serve investors but they do not have enough money to pay for compensation and relocation. Therefore, investors have to negotiate land purchase with landowners before they can complete land lease or allocation procedures. This often proves to be an overly-arduous process.

Chinas New Hope commercial center is one example. The company spent many months approaching authorities and real estate businesses but have yet to find a five-hectare land plot in downtown to build the complex. According to Truong Thai Son, deputy general director of Hoang Quan Real Estate Company, it is hard to seek land in the inner city, however, more opportunities for investors looking for land exist in the outlying districts.

Loc Thanh Company is one that has found such an opportunity. The company has just leased a large land plot near Thu Duc Market in Thu Duc District to build an export woodwork processing workshop. Vu Hong Minh, Loc Thanh director, spent months scouting for land in Nha Be District and District 9 as well as Di An District in neighboring Binh Duong Province. He worked through real estate businesses and local authorities, but was eventually lucky enough to find a good land plot at a reasonable price in Thu Duc with the help of his friends.

Land in outlying districts is abundant, but investors must still make an effort to find the land suitable to their demand. A case in point is the owner of an industrial operation who just bought a plot of 2,000 square-meter farmland in Binh Chanh District and built a factory there. He has spent VND10 billion on the land and factory construction, but his factory cannot operate because it is still unable to treat solid waste and is located in an area zoned for non-polluting industries.

To avoid this situation, Nguyen Thi Cam Van advised that investors should come to the Department of Zoning and Architecture to seek information before completing land procedures at the Department of Natural Resources and Environment.

Industrial parkprocedure

Industrial parks (IPs) and export processing zones (EPZs) in HCM City provide an easier, more effective, productive and economic route for many investors in need of factory land. The key contact is the HCM City EPZ and IP Authority (HEPZA). Investors can easily lease land in IPs. What matters is they must choose the park suitable to their operations, said Pham Thi Trang, HEPZA office manager.

There are 15 IPs in the city, and three or five more will be developed between now and 2010. The city government has plans to build three new IPs in Phu Huu, District 9, and Tan Quy and Phuoc Hiep in Cu Chi District. As well, Tai said existing IPs such as Le Minh Xuan, Vinh Loc, Tan Binh and Hiep Phuoc will be expanded to provide more land for investors.

At present, most IPs in HCM City still have land for lease. Tan Thuan EPZ has four hectares unoccupied, with priority for investors in hi-tech industries. Tan Tao IP has 30ha for non-polluting industries. Phong Phu IP (148ha) has 10ha for immediate occupancy. Tan Phu Trung IP (542ha) has 117ha with infrastructure ready for non-polluting enterprises relocated from the inner city. Cat Lai 2 IP has 11.7ha for investors.

IPs that will have land available for lease over the next six months to one year are expanded Vinh Loc (68ha), expanded Tan Binh (25ha), expanded Le Minh Xuan (800ha) and Tay Bac Cu Chi (170ha). However, the expansion will be implemented in stages and depend on compensation and site clearance.

According to some consultants, IPs have some advantages, such as fairly good infrastructure, wastewater treatment, simple land rent procedures and incentive policies for investors. However, they also have some unfavorable conditions, such as higher land rent compared with outside land and possibly less favorable access to human resources, and the market.

At present, Tan Thuan EPZ has the highest land rent, at US$108/m2/40 years. Tay Bac Cu Chi IP has the lowest rent, US$35/m2/46 years. The rent in other IPs ranges between US$75 and US$100/m2/50 years. However, there may be some differences depending on the lease term and payment mode.

To lease or allocate?

Investors seeking land outside IPs must first buy land and then apply for land allocation or lease at the Department of Natural Resources and Environment to obtain the land-use rights certificate. The department must contact relevant authorities to process the application. As a rule, the application will be processed within 20 days if it is in order; otherwise the department must notify the investors concerned.

The greatest difficulty for investors seeking land outside IPs is land transfer procedures, compensation and site clearance. In many cases, the ownership of the land they aim at has not yet been established, and the legal procedures are time consuming.

Meanwhile, land lease or allocation procedures in IPs are simpler because investors do not have to engage in compensation and site clearance. For land lease procedures, they just have to sign a lease with the representative of the IP and make a 10% deposit of the rent. Then they submit the investment application to HEPZA. If the application is in order, the authority will grant a license. Investors then sign an official land lease contract with the IP authority and pay 40% of the rent and complete post-licensing procedures. The remaining 50% rent will be paid in installment. All these affairs can be solved within three days.

However, for land allocation, the procedure is more complicated. The application for land allocation must be submitted to the Department of Natural Resources and Environment to determine the financial obligation. In addition to the land rent, investors must pay land-use fee to be eligible for receiving the land-use right certificate. However, a change in the price of farmland required under the revised Land Law has caused a problem in land allocation procedures at present and many land allocation applications have been caught in the red-tape. The city government has yet to work out the specific price frame.

At present, many local investors want to shift from land lease to land allocation because under the law, investors cannot transfer leased land, while those having allocated land can transfer it and contribute the land as capital. Moreover, investors receiving allocated land can mortgage it at banks to get loans as much as 80% or 90% of the land value. Meanwhile, investors leasing land can only get a maximum loan equivalent to 50% of the value of the land.

Saigont Times Weekly Issue No. 37 (780) 9/9/06

Vietnam sees many changes on trade front

2006-11-14T18:18:00.000-08:00

We think that is a major step, not only for the Vietnamese, but also a tag on American history as well. It doesn't seem that long ago when American troops were fighting on Vietnam soil to keep this same communist regime from gaining a stronghold in Southeast Asia.

Today, however, much has changed. America and Vietnam are wholesome trade partners. Vietnam, soon to be a WTO member, is now set to expand its already considerable wealth as a true member of world commerce. That also means more business with the United States.

According to the Associated Press, trade between the United States and Vietnam has grown from $1.2 billion in 2000 to $7.8 billion last year since the two countries implemented a bilateral trade agreement five years ago.

Vietnam is Asia's fastest-growing economy after China, and the Asian Development Bank in August has projected Vietnam's economy will expand by 7.8 percent this year.

Membership of the global trade body will give Vietnam increased access to foreign markets and the opportunity to take trade grievances to a neutral arbiter.

In return, Vietnam will be required to drop its high tariffs on foreign imports and eliminate subsidies for state-owned companies.

Many in America are looking forward to doing more business with Vietnam. Foreign investors, including Americans, eye the nation as fertile territory. Investment in the country has already sky-rocketed 41 percent in just the last year.

So far, the major breakthrough Vietnam has seen in regards to the United States is from garment exports to the U.S. Vietnam's garment industry is hoping to reap even greater profits after joining the WTO, which will require the United States to lift quotas on Vietnamese exports.

Still, there are some problems to be worked out as you might expect between two countries with a mutual, but sordid past. The U.S. has yet to approve a trade normalization bill.

Somewhere down the line, that drawback will be straightened out and the U.S. and Vietnam will be trade partners. That's a long way from the days of napalm bombs and AK 47s.

TNnews 11/14/06

Vietnam's booming stock exchange attracts attention at APEC summit

2006-11-14T18:16:00.000-08:00

HO CHI MINH CITY, Vietnam: Pushing and jostling for position, a crowd of investors surged to the center of Ho Chi Minh City's stock exchange to drop bids into several large boxes.

Vietnam's latest IPO an initial public offering of stocks drew about 1,000 people eager to cash in on a transportation and logistics company called Sotrans. Spilling into the adjacent lobby, they offered boisterous testimony to the communist country's deepening embrace of capitalism.

The market is emblematic of Vietnam's overall economy: energetic, fast-growing and still in the early stages of its development. It poses greater risks to investors than a more advanced economy, but also the promise of great returns.

U.S. President George W. Bush is scheduled to visit the exchange when he comes to Vietnam this week for the Asia-Pacific Economic Cooperation summit.

He will find a market on the move.

Vietnam's stock exchange is still tiny by global standards: the companies traded are worth roughly 2 percent of those listed in Thailand. But the number listed currently 52 is growing rapidly, and overall stock value increased tenfold in less than a year.

"You'd have to go quite a long way to find a stock market that's grown 10 times in 10 months, even though it started from a very small base," said Dominic Scriven of Dragon Capital, which manages an US$860 million investment fund in Vietnam. "And it probably will have grown 15 times by the end of the year."

When it opened six years ago, the market was the laughingstock of Southeast Asia. Few companies were listed, and foreign investors kept their distance. But it has taken off in the last couple of years, attracting the attention of investment firms such as Credit Suisse and Citigroup.

"Vietnam is beginning to deliver on a decade of promise," a recent Merrill Lynch report said.

Vietnam's GDP is expected to grow by more than 8 percent this year, second in Asia behind China and one of the highest rates in the world.

Investors are eager for a piece of the action.

Standing in line for the Sotrans IPO was Vo Van Dung, 36, a Ho Chi Minh City businessman. He began investing in the Thai stock exchange 13 years ago, before Vietnam had a formal market.

"When the market first opened here, I made good money because most people did not understand investing, but I already had experience," Dung said. "The market here is very promising. I don't think I will go back to Thailand."

On a recent day at the HSC securities firm in Ho Chi Minh City, about 50 people crowded around a stock ticker, eyes glued to the board. Brokers in their 20s took orders from behind a nearby counter.

Some of these eager investors will inevitably lose money. Others already have struck it rich.

A young man named Hung sat in the lobby in jeans and T-shirt, waiting to talk to his broker. Hung declined to give his full name because he didn't want his friends to think he was boasting about his wealth, a faux pas in Vietnam.

He said his initial investments of US$30,000 have grown to US$5 million. His best performer is the Export-Import Bank of Vietnam. A US$100,000 investment a year ago is now worth about US$800,000.

"A lot of my friends have made more money than I have," Hung said.

While such stories are legion, Scriven of Dragon Capital preaches caution. Reliable information about companies is far more difficult to obtain than on Wall Street, where Securities and Exchange Commission requirements lay out detailed disclosure requirements.

Vietnam has approved a new securities law that Scriven called "a huge leap forward." Effective Jan. 1, it will clarify investment rules and bring more transparency to the market, though still not as much as in developed countries.

Investors have more choices every day. The number of listed companies has risen by 50 percent in 2006 and is expected to double again by year's end, when tax incentives for listing will expire, said Tran Dac Sinh, director of the Ho Chi Minh City Stock Trading Center.

The market is drawing many novice Vietnamese investors, who often seem to operate with a herd mentality, Sinh said. "A lot of them buy when prices are going up, not when they're going down."

Many took a hit when the market surged earlier this year, rising to 630 points before falling to 400.

"A lot of investors lost money, but it was a good lesson for them," Sinh said.

For the recent IPO of Vinaconex, a big state-owned construction firm, nearly 2,000 people turned up, spilling out the trading center's front door and lining up around the block.

Like many state-owned firms, Vinaconex is in the process of "equitizing," selling off shares to private investors to raise capital. While the state will keep a stake, private investors will soon own more than 50 percent, Sinh said.

Refrigeration Electrical Engineering Corp. was the first market listing, back in 2000. Once a state-owned firm, REE has since sold 93 percent of its shares to private investors. Last year, the company raised US$10 million on the market, issuing shares that have since tripled in value.

"Vietnam is an emerging market, so you can find many opportunities here," said Nguyen Thi Mai Thanh, REE's managing director. "It's very exciting."

International Herald Tribune/AP 11/14/06

Bush goes on Asia trip, first visit to Vietnam

2006-11-14T18:12:00.000-08:00

WASHINGTON (Reuters) - President George W. Bush, politically weakened by U.S. congressional elections, heads to Asia on Tuesday on a three-nation swing likely to be dominated by North Korea and his views on fighting Islamic militancy.

The week-long trip to Singapore, Vietnam and Indonesia will allow Bush to leave the woes of Washington behind as opposition Democrats prepare to take command of the U.S. Congress and pressure him for a change of course on Iraq.

The trip will take him on his first visit to Vietnam, to attend the annual Asia Pacific Economic Cooperation summit that will put him face-to-face with leaders of the other four countries pressuring North Korea to give up nuclear weapons -- Russia, Japan, China and South Korea.

While in Singapore, Hanoi and Bogor, Indonesia, Bush will emphasize the importance he puts on fighting Islamic militancy that threatens security in parts of Southeast Asia.

Experts said Asian countries will be watching Bush to gauge how determined he is to confront foreign policy challenges after his Republican Party's election defeat on November 7 that meant he will have to deal with the Democrats for the remaining two years of his presidency.

"All Asian friends will be watching ... President Bush and his team in terms of his body language, his statements to see whether he will be weakened or committed to going forward with a broad and purposeful agenda in Asia as a whole," said Kurt Campbell, an Asia expert at the Center for Strategic and International Studies.

While in Hanoi, Bush will hold meetings with Japanese Prime Minister Shinzo Abe, Chinese President Hu Jintao, South Korea President Roh Moo-hyun and Russian President Vladimir Putin.

Bush's trip will take him on a round-the-world circuit. He was to leave Washington late on Tuesday for Moscow and he and his wife, Laura, were to have a brief social visit with Putin and his wife while Air Force One is refueled for the flight to Singapore.

Washington is seeking Russia's backing for a tougher line against both Iran and North Korea on their nuclear weapons programs. Meanwhile, Russia wants U.S. support for its bid to join the World Trade Organization.

Bush and Putin were once close but their relationship has been strained over U.S. criticisms of Russia's crackdown on democratic freedoms and Russian opposition to the Iraq war and what it sees as an overly aggressive U.S. foreign policy.

After visiting Singapore, Bush will become the second U.S. president to visit Vietnam -- after Bill Clinton -- since the war there scarred the American psyche. Bush himself was a pilot for the Texas Air National Guard rather than serving combat duty in Vietnam.

Comparisons between the Vietnam conflict and the 3-1/2 year Iraq war were bound to surface.

During Vietnam, the U.S. concern was the "domino theory" -- if it fell to communism, so would other nations. In Iraq, Bush says he fears that if U.S. troops pull out too fast and it falls into chaos, it and other nations will become part of a militant Islamic "caliphate."

But although last week's election result was driven in large part by U.S. public discontent with the Iraq war, White House national security adviser Stephen Hadley rejected Vietnam-Iraq comparisons. He said Americans are far more supportive of U.S. troops in Iraq and that they understand if Baghdad falls, Iraq would become a safe haven for terrorists.

Reuters 11/14/06

Vietnam regrets defeat of US trade bill, hopes for new vote soon

2006-11-14T18:10:00.000-08:00

The Republican leadership of the US House of Representatives failed Monday to round up the two-thirds majority needed to rush through permanent normal trade relations (PNTR) with Vietnam.

The measure received 228 votes for passage and 161 against, falling short of the two-thirds needed for the passage in the 435-strong chamber under special rules to pass it without a debate.

"It is very regrettable that the US House of Representative has not approved the bill," said Le Dung, spokesman for the Foreign Affairs Ministry who said the early defeat failed "to meet with the interest and aspiration of the two countries, especially the interest of US business."

Vietnam was approved last week to become the 150th member of the World Trade Organization. However, until normal trade relations are approved, the WTO rules will not apply to trade between the United States and Vietnam.

Without the WTO regulations, Vietnamese exports - including garments, its largest non-oil export - would still be restricted in the United States while American companies could not take advantage of hard-fought WTO concessions in opening up Vietnamese markets.

The initial defeat came a few days before US President George W Bush, who has endorsed normal relations with Vietnam, is to arrive in Hanoi for the Asia-Pacific Economic Cooperation (APEC) summit.

Congressional leaders have said they would resubmit the bill this week under normal debate rules, which would require a simple majority.

The same 228 votes would allow the measure to pass by simple majority in the House, but the bill would still need to be approved by the US Senate, where lawmakers seeking to protect US textile industries or punish Vietnam's human-rights record could still block its passage.

"We hope that the US Congress will approve PNTR to Vietnam at an early date, thus contributing to promoting the relations between the two countries," Dung said Tuesday.

On Monday, the Bush administration formally endorsed the bill. The president's Office of Management and Budget said in a statement that the bill would allow the United States and Vietnam to enjoy the benefits of Vietnam's membership in the WTO.

Vietnam has been hoping President Bush would arrive to normal trade relations when he attends the APEC summit in the capital city of Hanoi Saturday and Sunday.

The United States is now Vietnam's largest export market with nearly US$6 billion in exports last year.

The United States exported only about 1 billion dollars in goods to Vietnam, a trade deficit that contributes to lingering opposition to easing trade restrictions for Vietnam.


Mr Le Dung, spokesman for the Foreign Affairs Ministry

Vietnam expressed disappointment Tuesday at the initial defeat of a key trade bill in the US Congress, and a government spokesman said he hoped the measure would be passed soon.
TNnews 11/14/06

Vietnam Trades Up - By joining the WTO, Asia's second-fastest-growing economy is poised to kick its exports into a higher gea

2006-11-13T18:13:00.000-08:00

Anthony Salzman remembers the last time Vietnam was tipped to be Asia's next tiger economy. The former antiwar protester turned business consultant was representing Caterpillar in Vietnam when the country opened up to foreign investment in the early 1990s. Back then, Hanoi's streets were filled mostly with bicycles and all fax machines had to be registered with the police, but that didn't stop international executives from packing the bar of the only foreign-run hotel in Hanoi, the Metropole, to plot their future fortunes. "In that one bar on any given night," recalls Salzman, "there were people who, combined, could have pledged to invest $50 billion on the spot." The good times didn't last. In large part due to the communist government's murky investment rules and snail-pace economic reforms, investors grew frustrated and disillusioned over Vietnam's prospects. After the 1997 Asian financial crisis hit, the country's growth rate plunged from 8.2% to 4.8% in two years. "Vietnam didn't so much crash," Salzman recalls. "It was more like a dud."

Nearly a decade later, Vietnam's economy is sizzling, not fizzling?and investors are pouring back in, betting that the country is ready to adopt sweeping free-market reforms and open up to the world. There's a sound reason to think things are different this time. Last week, after many years of trying, Vietnam won its bid to join the World Trade Organization, a move that could help liberalize the country's economy and spark an export-driven boom similar to the boost China received after it joined the WTO in 2001. Vietnam is already on a roll. It's GDP growth rate this year is projected to be 8.2%, the second-fastest pace in Asia behind China and in a dead heat with India. Exports were up an estimated 24% in the first 10 months of 2006. The nascent stock market in Ho Chi Minh City is one of Asia's best-performing this year, up 70%. To top it all off, Hanoi is hosting this year's Asia-Pacific Economic Cooperation summit, on Nov. 18-19, which is expected to be attended by U.S. President George W. Bush and China President Hu Jintao. Salzman, who toughed out the lean years and built an industrial-materials distributorship with annual turnover of $100 million, says he thinks Vietnam has finally arrived as a modern economy. "Before, people said [the Vietnamese] weren't ready," he says. "Now, I think they're ready."

There's little doubt the country has a lot going for it. The workforce is educated and young?54% of Vietnam's 84 million citizens are under the age of 30. Wages are lower than they are in China's coastal cities, which compete for manufacturing jobs. The Communist Party recently installed a new government led by Prime Minister Nguyen Tan Dung, who has vowed to continue economic reforms and to tackle the country's pervasive corruption. While it's true that Vietnam's economy is still relatively small?at $53 billion last year, the country's total GDP is about half that of the Philippines?it is also vibrant, with a growing entrepreneurial class (40,000 private businesses were launched in 2005) and thriving commodity businesses. Vietnam is now the world's largest pepper exporter and second-largest exporter of coffee, cashews and rice. And multinational companies are increasingly selecting the country as a manufacturing base. Canon Inc. has two giant printer factories in Vietnam and is building a third in Bac Ninh province, 20 miles northeast of Hanoi. The new plant will be the largest inkjet printer factory in the world. Nike recently increased its annual production in Vietnam from 54 million pairs of shoes to 70 million, making the country the world's second-largest source of Nike sneakers (China is the largest).

Government officials are counting on WTO entry to maintain that momentum. As the organization's 150th member, Vietnam stands to get greater access to overseas markets such as the U.S. and Europe for its agricultural and manufactured exports; by hewing more closely to free-trade policies the WTO requires of its members, it may also be able to attract additional foreign investment in everything from factories to petrochemical plants, fueling job growth. (In the first 10 months of this year, foreign direct investment in Vietnam was estimated at $6.5 billion, surpassing the $6.1 billion total for all of last year.) "The WTO is sort of the stamp of approval that many, many large companies have been waiting for," says Tim Tucker, country manager for Ford Vietnam, which has an assembly plant outside Hanoi. "They are just going to flood into this country."

But that investment has a price attached. To gain WTO entry, Vietnam made greater concessions than other nations have been required to make upon joining, agreeing to lower trade barriers, reduce many subsidies and allow virtually unfettered foreign competition in some sectors of its domestic economy. "It's a tougher deal than even China got," says Jonathan Pincus, a Hanoi-based economist for the United Nations Development Programme (). For example, next April, Vietnam must allow foreign banks to set up their own branch offices in the country, without requiring them to partner with domestic lenders as banks wanting to enter China have been obligated to do. Vietnamese law now protects its state-dominated insurers by banning foreign insurance companies from selling to individuals, but that will change under the WTO. The stakes are high: less than 5% of Vietnamese people now have bank accounts or insurance, so the potential market is enormous. In the retail sector, dominant state-owned companies and small-shop owners alike are certain to feel the pinch as foreign chains launch offensives. "It's going to change very quickly," Pincus says. "Big supermarkets, big restaurant chains, big auto-repair shops will come in and offer better service?and customers will flock to them."

What could be bad for domestic businesses is welcomed by many Vietnamese consumers. Le To Nga, 65, lived through the Vietnam War and stood in line for ration cards in the 1980s. Today, she's happily filling her shopping cart at Big C, a vast new supermarket on Hanoi's outskirts run by France's Casino Group in a joint venture with a local company. Shopping "is not a matter of patriotism at all," Nga says. "These days, we just buy what we like." Foreign giants entering Vietnam will likely create as many or more jobs than they'll destroy, Pincus says, and the influx of new banks will free up credit?now available chiefly to state-owned companies?for capital-starved private businesses. Some Vietnamese businesses even welcome the competition. "I'm not worried," says Ly Qui Trung, founder of Phó 24, a chain of noodle shops. "We've already got a head start and a strong brand. I think we can compete even against McDonald's." (Trung will have to wait for that matchup; McDonald's says it has no plan to enter Vietnam.)

While local businesses gear up for the fight, Vietnam's government will have to move fast to bring its legal system and infrastructure up to speed if the country hopes to attract more multinationals. Running a factory in Vietnam can be a frustrating proposition. Electricity production is barely meeting demand, which is growing at 15% per year. Roads and ports are increasingly congested. Nike Vietnam's general manager Amanda Tucker says the company's containers sometimes sit on the dock for 24 hours before shipping out. Because Vietnam has no deep-water port to handle the new larger "super-container" ships, most exports must first go to Singapore before shipping to the U.S. and Europe, meaning more expense and delay. "The system is definitely under strain," Tucker says, and with the expected post-WTO export surge, "it's only going to get worse." Le Cong Minh, general director of Saigon Port, says there are plans to spend $600 million for upgrades, including a deep-water port at Cai Mep on the southern coast, by 2010. But the project has yet to be approved.

Perhaps Vietnam's biggest adjustment in joining the global economy will be changing its ingrained culture of corruption, secrecy and state intervention. The government recently enacted extensive new laws covering enterprise, investment and securities, which would boost protection for private businesses and increase transparency. Still, it will take time to train thousands of bureaucrats to apply rules fairly. The country ranks in the bottom third of Transparency International's corruption index; a recent government inspection of state ministries uncovered 1,700 graft cases in the first nine months of this year. Some investors grumble the government is still apt to make sudden changes in taxes, for instance, without notice. "Information is a big issue," says Dominic Scriven, director of Dragon Capital, an investment-banking firm in Ho Chi Minh City. "What you thought was true in January, may no longer be true in December."

Plenty of foreign firms have learned that the hard way. One of their main concerns is government meddling?a practice that Carl Thayer, a political professor at the Australian Defence Force Academy, calls "kicking the foreigner in the shin and demanding compensation." In a recent instance, Dutch bank ABN AMRO was accused by authorities of illegal foreign-exchange trades with state-owned Incombank, costing the latter $5.4 million. The Vietnamese bank is demanding that ABN AMRO repay the losses?even though they were incurred by an Incombank employee. ABN AMRO says it has done nothing wrong. Incombank won't comment, and Vietnamese authorities haven't said exactly which banking regulations have been broken. But what has sent a chill through the foreign investment community is that local Hanoi police?not state banking regulators?are running the investigation. "The rule of law is manipulated in Vietnam to serve interests rather than as an objective force," Thayer says. If foreign companies can't be confident they'll get fair treatment, "it will make people more hesitant to invest."

Vietnamese leaders must be asking a similar question: now that the country is a WTO member, will it be treated with fairness by the international trading community? By joining the WTO, Vietnam hopes to become free from trade restrictions such as garment quotas that in the past have constrained its exports to the U.S. and Europe. Textile manufacturing employs 2 million Vietnamese and is the country's largest export earner after crude oil. But Vietnam's trade relations with the West have sometimes been prickly. The U.S. in recent years has imposed antidumping tariffs on Vietnamese shrimp and catfish; the E.U. recently placed similar restrictions on Vietnamese-made shoes. While WTO membership gives Vietnam the ability to challenge such barriers, the country may still find itself blocked by them because Vietnam joined the WTO as a "non-market economy," a classification that denies it some protections afforded to fully fledged members. To complicate matters, the U.S., the country's largest export market, has yet to legally recognize Vietnam's WTO membership. Although passage of the necessary legislation that would grant "permanent normal trade status" to Vietnam is usually a mere formality, it could get held up in Congress by lawmakers seeking to protect textile manufacturers in their home states, or by politicians wanting to punish Vietnam for its poor human-rights record. As a result, the country could find itself in the unusual position of joining the WTO but having none of the benefits apply to its trade with the U.S., which imported nearly $6 billion in goods from Vietnam last year. "There's no question that WTO is going to be a very good thing for Vietnam," says the UNDP's Pincus. "But the thing is, they don't know how dirty the U.S. is going to play. Is the U.S. going to raise antidumping [barriers] every time Vietnam increases its market share?"

Despite the uncertainties, optimism over Vietnam's economic prospects runs deep. Last week, Intel announced it would increase its investment in a planned computer-chip-assembly and testing plant to $1 billion, tripling the company's original commitment. Upon completion, the 500,000-square-foot facility in Ho Chi Minh City will be the largest of its kind in the world. "I think Vietnam is doing all the right things," says Rick Howarth, Intel's country production manager. Says Scriven of Dragon Capital: "This is one of the most pro-change places I've been in. But there is time required. The headlines will come and the headlines will go, but the battle ahead is a long one." With WTO membership promising to even up the odds, Vietnam is ready to rumble.

TIME 11/13/06 Issue

Intel to Spend $1B on Vietnam Plant

2006-11-13T18:09:00.000-08:00

HO CHI MINH CITY, Vietnam -- Intel Corp., the world's largest computer chipmaker, announced Friday that it will more than triple its initial $300 million investment in Vietnam, dramatically expanding the size of a chip assembly and testing plant that it is constructing in the country's southern business hub.

The company plans to spend $1 billion on the plant and expand its size from 150,000 square feet to 500,000 square feet, a company official said Friday.

Construction is expected to be finished in 2007. It will be Vietnam's first semiconductor facility, and Intel's sixth testing facility in Asia.

Washington Post 11/10/06

Petro Vietnam to Help Finance Pulp Mill Project

2006-11-13T18:01:00.000-08:00

Nov. 13, 2006 - The PetroVietnam Finance Co. has agreed to provide a loan to Transport, Communication, Development and Investment Corp. (Tracodi) to support its pulp mill project in Long An Province in Vietnam.

Tracodi general director Phan Thanh Nam said that the US$13.6 million loan would go towards its Phuong Nam Pulp Mill, which began construction in March.

The French bank Societe Generale will also provide funds for Tracodi to import equipment, technology and technical services worth around $70 million.

The $93-million pulp mill is scheduled for completion in November 2007.

The new mill will have an annual capacity to produce 100,000 tonnes of pulp and will use jute grown in Long An Province as a raw material.

Pulp from the mill will be used domestically and for export.

SOURCE: Viet Nam News

High hopes now for Bush Vietnam trip

2006-11-12T23:25:00.000-08:00

When former President Bill Clinton lifted the trade embargo against Vietnam in 1994, he was blasted by many Vietnamese-Americans. His trip to Vietnam six years later generated more criticism.

But as President Bush prepares to visit Vietnam this week for a global economic summit, the reaction is much different.

Even some Vietnamese-American hardliners in favor of isolating Vietnam hope the trip deepens Washington-Hanoi ties.

Typical of the shifting attitudes are those of the once-militant Viet Tan, or Vietnam Reform Party. The San Jose, Calif., group formed in 1980 with the goal of overthrowing Vietnam's Communist government.

Diem Do, Viet Tan's chairman, now says: "Vietnam's economic integration with the world is good. No one can deny that."

On the eve of Vietnam hosting the Asia-Pacific Economic Cooperation summit and its likely entry into the World Trade Organization, Vietnamese-Americans seem to have reached a consensus: Vietnam's future should be dictated by the citizens of Vietnam, with the support of overseas Vietnamese.

APEC meeting starts in Vietnam

2006-11-12T23:24:00.000-08:00

HANOI (AFP) - The annual Asia-Pacific Economic Cooperation (APEC) meeting, due to bring leaders from 21 member economies to Vietnam, has kicked off with a senior officials' meeting in Hanoi.

"The informal meeting has started," APEC Secretariat spokesman Christopher Hawkins said. "This is the last chance for senior officials to discuss the issues the ministers and government leaders will take up in the week."

US President George W. Bush, China's Hu Jintao and Russia's Vladimir Putin are among the heads of state due to arrive in the communist country in the next few days ahead of the November 18-19 summit.

Senior officials at an informal retreat on Sunday were due to discuss ways to unlock stalled WTO talks, and how to reduce the spread of counterfeit and pirated goods, APEC said in a statement.

"APEC can lead the way for all members of the WTO to reignite negotiations," said the chair of the officials' meeting, Vietnam's Deputy Foreign Minister Le Cong Phung.

Foreign and trade ministers will begin their two-day meeting on Wednesday.

11/11/06

Intel to expand Vietnam plants

2006-11-12T23:07:00.000-08:00

HO CHI MINH CITY, Vietnam -- Intel Corp., the world's largest computer chipmaker, announced Friday it will more than triple its initial investment in Vietnam to $1 billion, dramatically expanding the size of a chip assembly and testing plant that it is building in the country's southern business hub.

"It will be the model for larger, more efficient assembly and test facilities that will gain Intel greater efficiency and improve our ability to meet our customers' requirement, making Intel even more competitive,'' said Brian Krzanich, Intel's vice president and general manager for assembly and test.

The announcement ceremony was attended by Prime Minister Nguyen Tan Dung and U.S. Ambassador Michael Marine.

The company plans to expand the size of the facility from 150,000 square feet to 500,000 square feet, Krzanich said.

Construction is expected to begin in March. It will be Vietnam's first semiconductor facility, and Intel's sixth testing facility in Asia. Krzanich said production is expected to begin in the second half of 2009 and that Intel plans to eventually employ up to 4,000 people. Santa Clara-based Intel had talked of 1,200 jobs when it announced a $300 million investment in February.

AP 11/10/06

US House of Representatives to vote on PNTR to Vietnam

2006-11-12T23:05:00.000-08:00

VietNamNet Bridge 11/12/06 - The US House of Representatives will vote on the bill on the permanent normal trade relations (PNTR) status to Vietnam on November 13, the first working day of the US Congress after its election.

According to the website of the US House of Representatives, from 4.30-6.30pm of November 13, this body will consider and vote on ten bills, including the bill allowing the expansion of the indiscrimination on Vietnams products and the establishment of a quota procedures on Vietnams subsidized apparels.

Thus, the US Congress will add the clause related to textile-garment into the bill on PNTR to Vietnam. This is a condition to gain the support of some congressmen who represent the interests of American textile-garment groups.

On September 29, two US senators, Elizabeth Dole and Lindsey Graham, representatives for the interests of US textile and garment groups announced that they would not prevent the approval of the bill on PNTR grant to Vietnam.

This statement was released after US senators had received the White Houses written commitment on monitoring and making public data related to textile and garments imported from Vietnam on a monthly basis and positively conduct investigation in case that any signal of dumping detected.

As the US House of Representatives will vote on the bill on PNTR grant to Vietnam on its first working day, it proves that PNTR status for Vietnam may be ratified by the US Congress before US President Bush goes to Vietnam for the 14^th APEC Summit next week.

A parliamentarian of the Democratic Party said that the US Congress might approve the PNTR status for Vietnam prior to the visit of Mr Bush to Hanoi next week. Vietnam is no longer a controversial issue, said Congressman Charles Rangel of New York.

President Bush has considered the approval of PNTR for Vietnam as a priority in his foreign policy. He has urged the US Congress to early ratify the PNTR bill for Vietnam because this regulation allows us to recognize Vietnam as a member of WTO.

On November 7, the World Trade Organisation (WTO) admitted Vietnam as its 150^th member. However, Vietnams bilateral commitments with the US under the WTO framework will not be effective if the US Congress doesnt approve PNTR.

APEC official hails upcoming visit by Chinese president to Vietnam

2006-11-12T23:04:00.000-08:00

The forthcoming visit by Chinese President Hu Jintao to Vietnam is of great importance, showing the fine development of friendly and cooperative relations between the two countries, an APEC (Asia-Pacific Economic Cooperation) official told Xinhua in Hanol Sunday.

"This is the second trip (by Hu Jintao) to Vietnam within one year. It reflects good traditional ties between the two countries, " said Pham Sanh Chau, head of a section in charge of information, culture and education under the APEC Secretariat, at the Hanoi National Convention Center, the venue of the annual APEC Asian meetings.

Vietnam and China have close relations which have developed quickly and soundly in many fields, said Chau, who is also vice director of a department under the Vietnamese Ministry of Foreign Affairs.

He noted that the close ties have borne specific fruits, including the recent establishment of the China-Vietnam steering committee on cooperation, which is mainly designated for coordinating their cooperation in various spheres.

Hu's approaching trip is well prepared, Chau said, adding that the Chinese president, scheduled to pay a state visit to Vietnam from Wednesday to Saturday, will attend the 14th APEC Economic Leaders' Meeting slated for Nov. 18-19 in Hanoi.

On the occasion of the leaders' meeting, five leaders of the world's biggest economies or countries having strong bonds with Vietnam will visit the country, he said. They include the Chinese president, U.S. President George W. Bush, Russian President Vladimir Putin, Japanese Prime Minister Shinzo Abe and Chilean President Michelle Bachelet Jeria.

On Sunday, senior officials from 21 APEC member economies met in an informal session in Hanoi, starting the APEC Economic Leaders' Meeting Week, including the 14th APEC Economic Leaders' Meeting, the 18th Joint Ministerial Meeting, the Concluding Senior Officials' Meeting and the Chief Executive Officers' Summit.

The two-day Concluding Senior Officials Meeting is very important as it will concludes the outcomes of three previous meetings of the officials in 2006; prepares contents for discussions at the 18th Joint Ministerial Meeting slated for Wednesday and Thursday, and even the 14th APEC Economic Leaders' Meeting; and outlines future discussions for APEC's development orientations, Chau stated.

Source: Xinhua 11/12/06

State councilor meets Vietnamese party leader on ties

2006-11-12T23:03:00.000-08:00

General Secretary of the Communist Party of Vietnam Central Committee (CPVCC) Nong Duc Manh (R) meets with visiting Chinese State Councilor Tang Jiaxuan in Hanoi, capital of Vietnam, Nov. 11, 2006. (Xinhua Photo)
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Vietnamese President Nguyen Minh Triet (front R) meets with visiting Chinese State Councilor Tang Jiaxuan in Hanoi, capital of Vietnam, Nov. 11, 2006. (Xinhua Photo)
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Vietnamese Prime Minister Nguyen Tan Dung (R) meets with visiting Chinese State Councilor Tang Jiaxuan in Hanoi, capital of Vietnam, Nov. 11, 2006. (Xinhua Photo)

HANOI, Nov. 11 (Xinhua) -- Chinese State Councilor Tang Jiaxuan met here on Saturday with General Secretary of the Communist Party of Vietnam Central Committee Nong Duc Manh.

The Vietnamese communist party, government and people appreciated China's persistent assistance in Vietnam's struggle for national independence and construction of the country, Manh said.

Vietnam will strengthen exchange and cooperation with China for common development, which will also make the two neighbors good friends, comrades and partners, he added.

Chinese President Hu Jintao's upcoming visit will surely further boost the Vietnam-China good neighborly relations, usher in a new era in the history of ties between the two parties and two countries, Manh said.

Hu, who is scheduled to pay a state visit to Vietnam on Nov. 15-17, will also attend an informal meeting of the Asia-Pacific Economic Cooperation leaders to be held in Hanoi on Nov. 18-19.

Tang said it's the common interest and aspiration for the two peoples to deepen the traditional Sino-Vietnamese friendship and strengthen their cooperation of mutual benefit.

The newly-established China-Vietnam steering committee on cooperation marked a new phase of their bilateral ties developing in an all-round and coordinated way, he added.

The committee, which is designed to coordinate China-Vietnam cooperation in various fields and address major issues in their cooperation, will meet once a year in the two countries alternatively.

China is willing to work jointly with the Vietnamese side to push their good-neighborly cooperation to a new high under the guidelines of "long-term stability, looking to the future, good-neighborliness and all-round development," Tang said.

During President Hu's visit, leaders of the two countries will exchange views on important issues of common concern and reach new consensus for future Sino-Vietnamese cooperation, he noted.

On the same day, Tang also met with Vietnamese State President Nguyen Minh Triet and Vietnamese Prime Minister Nguyen Tan Dung on bilateral ties and trade cooperation.

China-Vietnam friendly ties on fast-growing pace

2006-11-12T23:01:00.000-08:00

HANOI, Nov. 12 (Xinhua) -- General Secretary of the Communist Party of China Central Committee (CPCCC) and Chinese President Hu Jintao will pay a state visit to Vietnam on Nov. 15-17 to further enhance the friendship ties between the two Asian nations.

Hu's visit, at the invitation of General Secretary of the Communist Party of Vietnam Central Committee (CPVCC) Nong Duc Manhand Vietnamese State President Nguyen Minh Triet, will be another important political event for the two countries following the reciprocal visits by the heads of the two states in 2005, and the visit to China by Manh in August.

The upcoming visit will be of great significance and exert far-reaching influences on pushing ahead relations between the two neighboring countries, said Cui Tiankai, Chinese assistant foreign minister, last Tuesday at a news conference on Hu's visit.

China and Vietnam have shared mountains and rivers, and the twopeoples have the long-term friendship. Bilateral ties have been consolidated and developed over the past decades.

Leaders of the two countries, since the turning of the new century, have identified the principle of "friendly neighborliness, comprehensive cooperation, long-term stability, future orientation," and the four-good spirit -- good neighbors, good friends, good comrades and good partners -- in their relationship development, increasing mutual trust for the China-Vietnam traditional friendship.

The mutual support and all-round cooperation between the two countries for the mutual benefit and development have become a hallmark in the new model of bilateral ties in the new century, driving the relations between the two parties and two countries to a new stage of comprehensive cooperation.

In recent years, China and Vietnam have seen remarkable closer ties.

First, the frequent reciprocal visits of the two countries' leaders, in which they have reached common awareness, have unceasingly enriched the friendly ties and created springboards for their stable cooperation.

The prime ministers of the two countries exchanged visits in 2004, and the heads of the two states did so in 2005. In August, Manh paid an official visit to China, which was his first overseas trip since he was reelected the post in April.

During the talks between the two general secretaries, the two sides reached consensuses on such important issues as inheriting and bringing into full play the China-Vietnam traditional friendship, increasing mutual trust, enhancing cooperation for mutual benefit and development. They also identified development orientations for the two nation's future cooperation.

Second, the smooth progress has been achieved in dealing with issues left by the history such as those on border and territory. Their land border demarcation work is expected to be completed in 2008, and the Beibu Bay Demarcation Agreement and the Beibu Bay Fishery Cooperation Agreement are actively implemented.

The two countries have held exchanging activities among youths for five times, contributing to increasing their mutual understanding and belief, creating conditions for the two countries' development.

Third, the two countries have broadened trade cooperation and increased their trade turnovers. The two-way trade gained 6.74 billion U.S. dollars in 2004, up 45.3 percent from 2003, making China Vietnam's biggest trade partner.

The two sides, which posted trade of over 8 billion dollars in 2005 and 4.6 billion dollars in the first six months of 2006, are expected to reach the trade target of 10 billion dollars ahead of schedule of 2010 set by the two countries' prime ministers. China now ranks the 15th among countries and regions pouring investment into Vietnam.

Chinese Premier Wen Jiabao held talks with his Vietnamese counterpart Nguyen Tan Dung late last month when they attended a summit commemorating the 15th anniversary of the dialogue partnership between China and the Association of Southeast Asian Nations (ASEAN) in Nanning, capital of China's Guangxi Zhuang Autonomous Region. This helps beef up the close ties between the two countries and their common awareness about trade cooperation, an important pillar in their relations.

Chinese President Hu Jintao's upcoming visit will surely further boost the Vietnam-China good neighborly relations, ushering in a new era in the history of ties between the two parties and two countries, Vietnamese party leader Manh said Saturday.

Chinese state councilor says steering committee to boost China-Vietnam ties

2006-11-11T20:54:00.001-08:00

Chinese State Councilor Tang Jiaxuan said in Hanol on Saturday that the newly-established steering committee on cooperation will further promote the long-term good- neighborly relations between China and Vietnam.

"The development of Sino-Vietnamese ties have progressed in recent years with exchanges and cooperation being expanded and deepened in an all-round and comprehensive way," Tang told the first meeting of the China-Vietnam steering committee on cooperation.

China is willing to make joint efforts with the Vietnamese side to implement the consensus reached between leaders of the Communist Party of China and the Vietnamese Communist Party as well as leaders of the two countries, he added.

Vietnamese Deputy Prime Minister and Foreign Minister Pham Gia Khiem, who co-chaired the meeting with Tang, said his country hopes to boost the Vietnam-China friendly cooperation through the creation of the joint committee.

The committee, which is designed to coordinate China-Vietnam cooperation in various fields and address major issues in their cooperation, will meet once a year in the two countries alternatively.

At the meeting, the two side also discussed the preparations of the upcoming visit to Vietnam by Chinese President Hu Jintao and believed his visit will surely have far-reaching impact on the relations between the two parties and two countries.

Hu, who is scheduled to pay a state visit to Vietnam on Nov. 15- 17, will also attend an informal meeting of the Asia-Pacific Economic Cooperation leaders to be held in Hanoi on Nov. 18-19.

Source: Xinhua 11/12/06

China wishes to bring co-operation with Vietnam to new stage

2006-11-11T20:54:00.000-08:00

Chairman of the Standing Committee of the Chinese National People's Congress, Wu Bangguo, stressed that China wished to bring co-operation with Vietnam to a new stage of more comprehensive and deeper development.

Wu made the affirmation while meeting with visiting President of the Vietnam Fatherland Front Central Committee Pham The Duyet on November 9.

Wu stated that China and Vietnam are the two socialist countries and friendly neighbours. Boosting bilateral friendship was in accordance with mutual benefits and important to bilateral relations.

He further said that China always attached importance to development of its relationship and comprehensive co-operation with Vietnam, strengthening political trust, focusing on quality of co-operation, and boosting common development.

Meeting with a delegation of the Vietnamese young people the same day, Vice Chairman of the Chinese People's Political Consultative Conference, Li Meng, expressed hope that there will be more young people ready to enhance the China-Vietnam friendship. (VNA 11/11/06)

Vietnam's WTO Membership Will Cut Both Ways, Bringing Opportunities and Challenges

2006-11-10T06:43:00.000-08:00

HO CHI MINH CITY, Vietnam (AP 11/6/06) -- Banking on new business after Vietnam joins the World Trade Organization, electrical appliance maker REE Corp. added a new office tower to Ho Chi Minh City's burgeoning skyline. But it's also bracing for an onslaught of competition from global giants like Toshiba and Samsung.

For REE Corp. and for Vietnam, WTO membership will cut both ways.

"Joining the WTO will create a lot of opportunities," said Nguyen Thi Mai Thanh, the company's general director. "But it will also present strategic challenges."

WTO members are expected to approve Vietnam's entry on Tuesday, bringing to an end 10 years of negotiations with the communist country, which has recently begun accelerating the pace of market reforms. The deal will take effect 30 days after Vietnam's National Assembly approves it, which it is expected to do swiftly.

Tuesday's vote is well timed, coming just days before Hanoi will be in the spotlight hosting the Asia-Pacific Economic Cooperation summit, which will draw leaders from 21 countries and thousands of business executives from around the world.

WTO membership will give Vietnam increased access to foreign markets and the opportunity to take trade grievances to a neutral arbiter, strengthening its hand against nations that accuse Vietnam of illegally dumping goods on their markets. In return, the country will be required to drop its high tariffs on foreign imports and eliminate subsidies for state-owned companies.

Foreign companies will enjoy far greater access to Vietnam's economy, which has averaged 7.5 percent growth over the last decade, one of fastest rates anywhere in the world.

However, American businesses may not be able to take advantage of the WTO agreement immediately because the U.S. Congress has yet to grant Vietnam "permanent normal trade relations" status. President Bush hopes a PNTR bill will be passed before he visits Hanoi for the APEC summit Nov. 18-19, but that looks unlikely.

Among other obstacles, Sen. Mel Martinez, a Florida Republican, has been blocking consideration of the bill due to concerns about a Florida pro-democracy activist who is being held in a Vietnamese jail, suspected of plotting against the Vietnamese government.

The PNTR bill is expected to be approved eventually. But without it, U.S. companies will not be able to enjoy the benefits of the WTO agreement -- unless Vietnam decides unilaterally to treat them like other member countries.

Still, since the United States and Vietnam implemented a bilateral trade agreement five years ago, trade between the former foes has grown from $1.2 billion in 2000 to $7.8 billion last year.

Many Vietnamese businesses, especially garment makers, are excited about new export opportunities that WTO membership will bring. Others, like REE Corp., are eager to supply goods and services to foreign companies that come to Vietnam.

But some businesses here -- particularly in banking, insurance and financial services -- also worry about the new competition WTO membership will bring. State-owned domestic companies, still steeped in the old central-planning mentality, will inevitably be forced to change or perish.

"Foreign competition is bitter medicine for Vietnamese enterprises, but it will help them become stronger," said Le Dang Doanh, an economist at the Ministry of Planning and Investment.

As of April 1, foreign banks will be able to operate their own, fully owned branches for the first time, said Alain Cany, head of the European Chamber of Commerce and director of HSBC Bank's Vietnam operations.

"We are in a country of 84 million, most of them very young people who like saving and like buying," Cany said. "They will take loans from us and use our credit cards. It's going to be a great market."

At the Eastern Asia Commercial Bank, one of Vietnam's more successful banks, director Tran Phuong Binh is rapidly installing new ATM machines and opening new branches, some in rural areas that will be difficult for foreign banks to serve.

In addition to introducing a new ATM card, Binh also is developing a "take out" service for customers, who can call and have money delivered to their house.

"We sometimes have to cross rivers to serve our rural customers," Binh said. "I don't think foreign banks will be able to serve this market."

Foreign investment in Vietnam has surged ahead of Tuesday's vote, rising 41 percent in the last year. Foreign firms have been encouraged by Vietnam's market reforms, which began tentatively in the late 1980s, moved in fits and starts during the 1990s and greatly accelerated over the last three years.

The government has approved new enterprise and investment laws that grant equal treatment to foreign and domestic firms, and it will soon approve a securities law that will increase the transparency of Vietnam's small but booming stock market.

"Entering the WTO sends a very important signal that everything they have done so far is not just temporary," said Cristoph Wyesner, head of the European Commission's political, economic and trade section in Hanoi.

Vietnam's garment exports to the U.S. have skyrocketed, and the industry is hoping to reap even greater profits after joining the WTO, which will require the United States to lift quotas on Vietnam's garment exports. But expectations have been tempered by ongoing negotiations on the trade normalization bill.

In response to concerns raised by two senators from the textile-producing states of North Carolina and South Carolina, the U.S. Commerce Dept. has struck an arrangement under which it will keep a close watch on Vietnam's garment exports and initiate antidumping measures if the clothing is judged to be sold at lower-than-market costs.

Vietnamese garment manufacturers plan to tread carefully, limiting export growth to about 20 percent a year, said Nguyen Huu Binh, deputy general director of Vinatex, Vietnam's largest garment company, which produces clothes for Wal-mart Stores Inc., Nike Inc., and other U.S. retailers.

"We don't want them to bring antidumping cases against us," Binh said. "That would be even worse than quotas."

Vietnam's WTO entry commitments

2006-11-10T05:06:00.000-08:00

These are some highlights:

Goods: Schedule of Concessions and Commitments on Goods

For the majority of agricultural and non-agricultural goods, Vietnam is promising ceilings (or bound rates) on duties ranging between zero and 35%. Some of these involve reductions phased over periods up to 2014, the precise end date varying from product to product.

Among products with higher ceilings are: alcoholic drinks, tobacco products, instant coffee and some related products, new and used motor vehicles and components, and roof tiles. Used vehicles less than five years old can be charged additional flat-rate duties up to specified limits.

These bound rates are legal ceilings. The actual duties that Vietnam can charge (the applied rates) can be lower than the committed rates. Among the details of Vietnams commitments is a promise not to charge higher applied rates on rapeseed (also known as colza or canola) and derived meal, oil and other products than the duties actually charged on soy products allowing the oilseed products to compete with soy.

In the separate working party report, Vietnam has also reserved the right to charge applied duties in the form of specific duties (e.g. dollars per tonne) instead of percentages of the price (ad valorem) so long as the result stays below the committed ceilings.

A handful of products are going to be protected with tariff quotas (higher duties for quantities outside the quotas, and lower duties for quantities within the quotas): eggs, tobacco, sugar, and salt (which Vietnam says is the main income source for 100,000 poor farmers in coastal areas). But Vietnam will expand the quotas until they disappear according to agreed timetables.

Vietnam has also signed the plurilateral Information Technology Agreement (plurilateral meaning only some WTO members have signed). For these products, Vietnam has agreed to allow imports in duty-free. In some cases, the zero duty will apply immediately; in others it will be achieved gradually over periods ending in 2010 to 2014.

In agriculture, Vietnam has promised not to subsidize exports. It will be allowed to support its farmers domestically with trade-distorting supports (Amber Box or Aggregate Measurement of Support, i.e. supports that have a direct impact on prices or quantities produced) of up to 3,961.5 billion Vietnamese dong (currently about US$246 million) in addition to the usual allowance for developing countries (known as de minimis) of up to 10% of the value of domestic agricultural production. As with all WTO members, Vietnam can also spend unlimited amounts on supports that do not distort trade (Green Box supports).

Services: Schedule of Specific Commitments on Trade in Services

Vietnam has made commitments on a range of services. In some cases Vietnam reserves the right to limit foreign ownership of service companies operating in Vietnam for example in some telecommunications services the eventual limits can be 49% or 65%, depending on the service. In a few cases, permitted foreign ownership is immediately 100% (for example accountancy). In many cases, the permitted foreign ownership is phased in to reach 100% after a few years (for example express delivery courier services after five years).

As is normal in this sector, the effect of the commitments depends also on complex relationships with domestic regulations for example in the first two years, 100%-foreign-owned architectural firms can only serve foreign companies. The commitments and some of the regulations are in the schedule (lists) of commitments; other information on the regulations is in the working party report.

The working party report: Report of the Working Party on the Accession of Vietnam

The working party report outlines the economic context, and the institutional and legal framework. It includes Vietnams commitments to undertake reforms or to preserve reforms that have been introduced in order to secure membership. Among the commitments are:

Foreign exchange: Vietnam will abide by IMF and WTO rules

State enterprises: commercial business (i.e. except for supplying the government) will be conducted on commercial terms without interference from the government. A number of products are listed as subject to state trading enterprises because of consumption restrictions, for cultural and moral reasons, or because they are natural monopolies: tobacco products, petroleum, cultural products such as newspapers, journals and audio-visual materials, and aircraft

Privatization and equitization of state enterprises: this will be handled transparently, with Vietnam supplying annual reports while the programme lasts

Pricing and price controls: Vietnam will comply with WTO agreements and notify the WTO of actions it takes to control prices

Policy-making and enforcing framework: a number of administrative and legal structures have been introduced or strengthened so that WTO provisions are applied, including the possibility of investigation and judicial review to deal with complaints about this

Trading rights (the right to import and export): this was a subject of tough negotiations partly because of different registration procedures for foreign and domestic traders. A new law has now harmonized the procedure for both.

Among the many additional details are a commitment that all foreign firms and individuals will be able to engage in importing and exporting as importers/exporters of record so long as they register, and importers will be able to choose their domestic distributors

Excise duties: the different duties charged on alcoholic drinks attracted particular attention in the negotiations. Vietnam has agreed to simplify the structure within 3 years by applying a single rate for all forms of beer and a single rate for all spirits containing 20% alcohol or more. This has allayed concerns from some countries that the previous structure might discriminate against imported beers that have different packaging, or against imported spirits with higher alcohol content

Quantitative and other restrictions: quotas, bans and other restrictions will be abolished, including import bans on cigarettes, cigars and used vehicles, or only applied according to WTO rules

WTO agreements dealing with rules: Vietnam will comply with the Customs Valuation, Rules of Origin, Pre-shipment Inspection, Anti-dumping, Safeguards, Subsidies, and Trade-Related Investment Measures agreements, with some provisions phased in over a period

Export restrictions: Vietnam maintains export controls on some products such as rice, and some wood products and minerals (to prevent illegal exploitation). It is pledging to apply controls on these products in a way that conforms with WTO agreements

Standards: Vietnam will apply the Technical Barriers to Trade, and Sanitary and Phytosanitary Measures agreements without a transition period

Government procurement: Vietnam will consider signing the Government Procurement Agreement after it has become a WTO member

Intellectual property: almost 33 pages of the report describe in detail the administrative and legal set up in the country. Vietnam will comply with the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement immediately, without any transition period.

TNnews 11/8/06

Hanoi to host Asia Pacific investment forum

2006-11-10T02:59:00.000-08:00

TNnews 11/7/06 Organized within the framework of the Asia Pacific Economic Cooperation (APEC) Leaders Meeting Week, the APEC Investment Forum 2006 (AIF) will take place on Nov. 15-16 with over 600 delegates attending.

Phan Huu Thang, head of the Vietnamese Ministry of Planning and Investments Foreign Investment Department, said Monday the forum would include a plenary session where Prime Minister Nguyen Tan Dung would make a speech, and workshops on investment promotion between APEC economies.

It would acquaint members with investment environments and opportunities in APEC economies.

His ministry would host a workshop that would focus on Vietnams new policies related to investment, including the Investment Law and Enterprise Law.

Thang said further that preparations for the forum had been completed.

The forum, an annual event, is aimed at helping APEC economies exchange notes on attracting and efficiently using foreign investment, and discussing measures to enhance economic and investment relations within APEC and with other partners.

The APEC Economic Leaders Meeting Week, slated for November 12-19, includes many other events, notably the 14th APEC Economic Leaders Meeting on November 18-19.

By hosting the APEC events and joining the World Trade Organization (WTO), Vietnam could underline its international prestige, Thang said.

He predicted a wave of investment from the 20 other APEC economies in Vietnam for its safe investment climate and open policies.

Vietnams major FDI source

APEC members have invested over US$41.7 billion in Vietnam, making up over 73 percent of the nation's foreign direct investment (FDI).

Taiwan leads with 1,542 projects capitalized at $8.04 billion.

It is followed by Singapore with $8.03 billion and Japan with $7.1 billion.

Japan, however, leads in terms of money actually invested with over $4.7 billion.

The world's second largest economy has also signed with Vietnam a joint initiative to improve the latters investment climate.

The US has invested some $2 billion in Vietnam $3 billion if investment through third countries is considered ranking seventh among 74 foreign investors.

Ho Chi Minh City, Hanoi, and southern provinces like Dong Nai and Binh Duong are the largest destinations in Vietnam for APEC investment.

Southern metro HCMC leads with an investment of $9.8 billion, followed by Hanoi with $7.8 billion.

Thang said there were also plans to bring on board the four APEC economies yet to invest in Vietnam Papua New Guinea, Mexico, Chile, and Peru.


Mr Phan Huu Thang, head of the Vietnamese Ministry of Planning and Investments Foreign Investment Department

Representatives of 21 Asia Pacific economies will attend a forum in Hanoi next week to discuss ways to boost investment within the bloc and from outside.

DHL inaugurates express delivery joint-venture in Vietnam

2006-11-10T01:49:00.000-08:00

The 51-49 venture between the German firm and state-owned Vietnam Post and Telecommunications Corporation (VNPT) will provide express delivery services in eight cities and provinces.

The two sides will each pump in US$5.5 million in the first year and another $4.4 million over the next five years.

Vietnam is viewed as one of the companys top five markets in Asia-Pacific region.

DHL plans to invest 6.8 million (US$8 million) to build more warehouses and freight depots and strengthen its vehicle fleet in the next few years.

The Deutsche Post World Net-owned company has collaborated with VNPT to do business in Vietnam since it first entered the market 17 years ago.

Global express and logistics giant DHL launched Thursday a joint-venture in Vietnam with a local partner.
TNnews 11/8/06

Intel to treble Vietnam investment to $1 bn

2006-11-10T00:58:00.000-08:00

HANOI, NOVEMBER 8: Intel Corp, the world's largest chip maker, is to more than treble its investment in building two plants in Vietnam to $1 billion, sources familiar with the firm's plan said on Wednesday.

"The licence for the increased investment to $1 billion will be handed to Intel on Friday," said a source close to the management board of Saigon High-Tech Park, where Intel's Vietnam unit is building its first plant.

When licensed in February for an initial investment of $300 million, Intel's project to package and test microchips that power personal computers and mobile phones was the biggest investment in Vietnam by a U.S. company.

Vietnam, which has one of the world's fastest-growing economies after China, became the newest member of the World Trade Organisation on Tuesday and many economic analysts expect investment to increase.

Next week, the Communist-run country's thriving economy will be on show when Hanoi hosts the Asia-Pacific Economic Cooperation leaders' week, with hundreds of company executives attending.

A second source familiar with the deal said that initially, California-based Intel had an option to build a second phase for its plant that would double the investment to $605 million.

"But now it wanted to bring the investment up to $1 billion in the second phase," said the source, who declined to be identified due to a lack of authorisation to give details.

Intel Products Vietnam said in an invitation received by Reuters that Intel Deputy Chairman Brian Krzanich would announce the new investment level at a ceremony in Ho Chi Minh City, Vietnam's commercial centre, on Friday.

In February, Intel Chairman Craig Barret said production at the Vietnam plant, its seventh in the world, would start in the second half of 2007.

Rising Interest

Industry officials say the Intel project would help Vietnam draw foreign investors, including those in related businesses.

"The attraction of US group Intel to invest in the high-tech park," the park's board said in a statement, "immediately created an attractive force to many companies and partners to survey on investment opportunity at the park".

Vietnam's technology sector is relatively small, but the country has become the world's top producer of robusta coffee and black pepper, the second-largest rice exporter and Southeast Asia's third-biggest crude oil producer.

The International Monetary Fund said in its annual review of Vietnam's economy published on Tuesday that WTO membership would create opportunities for expanding non-oil exports and foreign direct investment, a big driver of the economy.

This year, pledges are expected to rise 19 per cent from 2005 to $6.6 billion despite graft and lack of transparency in auditing and information.

WTO entry to boost US investment in Vietnam: AmCham

2006-11-10T00:19:00.000-08:00

Executive Director Adam R. Sitkoff told a Vietnam News Agency correspondent Wednesday that WTO will bring AmCham members increased opportunities in both the goods and services sectors.

American investors are attracted to Vietnam's strong GDP growth, rapid industrialization, huge labor force, stable political situation and the prospect of a better business climate under WTO rules, he explained.

He gave an example of "increased optimism" by American investors that Intel had announced it will more than triple its investment in Vietnam to US$1 billion.

And, there is more to come as American companies weigh the opportunities that WTO accession will bring, he affirmed.

According to the AmCham Executive Director, most American investment to Vietnam had come from US company subsidiaries in a third country.

When FDI and foreign indirect investment are added together, the US is the top foreign investor in Vietnam , he said.

Regarding the US' granting of Permanent Normal Trade Relations (PNTR) status for Vietnam , he said: PNTR for Vietnam is the final step in full economic normalisation between the two countries.

If Vietnam joins the WTO without the extension of PNTR status by the United States, American workers and companies risk losing the full benefits of Vietnam 's WTO accession agreement.

He said AmCham continued to lobby the US Congress and Administration to grant PNTR status as quickly as possible. TNnews 11/9/06

Increased investors confidence over Vietnam's accession to the World Trade Organization (WTO) will boost the level of US investment in the country, an official of the American Chamber of Commerce (AmCham) in Hanoi said.

Electricity of Vietnam signs banking-services MOU with Citigroup

2006-11-09T21:54:00.000-08:00

HANOI (MarketWatch 11/7/06) -- Citigroup Inc. (C) will sign a Memorandum of Understanding to provide banking services for state-owned Electricity of Vietnam, or EVN, an EVN official said Tuesday.

Unlisted EVN, the largest seller of electricity in Vietnam, plans to streamline its financial systems, including methods used to collect money from its more than 9 million customers, said the official at EVN's headquarters in Hanoi.

EVN will also sign a loan agreement for $20 million with Citigroup, the official added, without elaborating.

He gave no further details on future cooperation between the two companies.

Citigroup officials weren't immediately available for comment.

Vietnam officially becomes WTO's 150th member

2006-11-09T21:03:00.000-08:00

NhanDan (11/8/06) Vietnam was officially admitted to the World Trade Organisation (WTO) during a special meeting of the WTO General Council on November 7 in Geneva.

The admission ended Vietnams 11-year long negotiation process in order to join the world's largest trade body and paved the way for the country to join within 30 days of its National Assembly ratifying the accord.

Eirick Glenne, President of the WTO General Council-cum-Chairman of the Working Party on the Accession of Vietnam to the WTO, marked the start of the meeting by summarising Vietnam's negotiation process and gave final approval of Vietnam's commitments with the consensus of all 149 WTO members. The council then approved Protocol WT/ACC/VNM/48 on Vietnam's WTO accession.

The meeting was followed by the signing of the protocol on Vietnam's WTO entry between the Vietnamese Trade Minister Truong Dinh Tuyen and the Director-General of the WTO, Pascal Lamy. Deputy Prime Minister-cum-Foreign Minister Pham Gia Khiem, who was also head of the Vietnamese Government's high-level delegation to the accession ceremony, witnessed the signing.

Addressing the ceremony, Director General Pascal stressed that Vietnam's accession to the WTO has helped improve the prestige of the largest trade body. It will not only benefit Vietnam but also all WTO members, he added.

Regional representatives of WTO members congratulated Vietnam and expressed their belief that their cooperation with Vietnam will be further developed.

Deputy Prime Minister and Minister of Foreign Affairs Pham Gia Khiem delivered a speech in which he emphasised that Vietnam's accession to the WTO is "an event of great significance, marking an important step for Vietnam's participation in the global trading system on an equal footing with all other WTO members."

The Deputy PM stated that Vietnam will strictly implement its commitments and actively contribute to the common tasks of the WTO.

The Deputy PM expressed his strong confidence that with serious preparation and efforts, together with the kind cooperation and keen support by other WTO members, " Vietnam is resolved to be a responsible and reliable member, effectively contribute to the common process."

WTO membership also helps Vietnam refine its reform process, creating opportunities for trade expansion, which is an important tool for economic growth," Trade Minister Truong Dinh Tuyen said in Geneva

"WTO accession poses major challenges to Vietnam's economy. However, we do believe that with co-operation extended by the members, Vietnam will make the most of opportunities," he added.(VNA, WTO)

China-Vietnam steering committee to hold first-ever meeting

2006-11-09T03:41:00.000-08:00

China announced on Tuesday that the first meeting under a China-Vietnam steering committee on cooperation will be held on Nov. 11.

Chinese State Councilor Tang Jiaxuan and Vietnamese Deputy Prime Minister and Foreign Minister Pham Gia Khiem will co-chair the meeting in Vietnam's capital city of Hanoi, said Jiang Yu, Chinese foreign ministry spokeswoman.

The meeting is to carry out the consensus achieved by the two countries' leaders in August, Jiang said.

Chinese communist party leader and President Hu Jintao held talks with Vietnamese Communist Party leader Nong Duc Manh in Beijing on Aug. 22. The two heads agreed to further boost trade, properly handle border issues and enhance security cooperation.

Source: Xinhua 11/8/06

Vietnam's Neighbors Fear Membership in WTO Will Woo Away Markets, Investment

2006-11-07T18:29:00.000-08:00

With Vietnam being admitted into the World Trade Organization, some of its neighbors in Southeast Asia are fearful that the region's newest economic tiger will capture export markets and foreign investment that might otherwise flow their way. Vietnam's W.T.O. entry is serving as a wake-up call for its regional competitors.

Five years ago, Southeast Asian nations - many of them still recovering from the 1997 regional economic crisis - were shaken by China's entry into the W.T.O. Now, it is Vietnam's turn to cause jitters among its neighbors.

Vietnam registered 8.4 percent growth last year - second only to China among Asian countries. And like China and many of its partners in the Association of Southeast Asian Nations, Vietnam has used a combination of low cost labor, foreign direct investment and export-oriented industry to fuel that growth.

Somphob Manarangsan, a professor of economics at Bangkok's Thammasat University, says Vietnam's W.T.O. membership is going to be felt in the region.

"After entering the W.T.O., Vietnam is going to be much more competitive, have a much more competitive advantage than other ASEAN countries, particularly Thailand," he said.

Somphob says two of Thailand's main export industries will be severely affected by Vietnamese competition: electronics and food processing. And he says Indonesia will be similarly affected by Vietnamese competition in the footwear and garment industries.

Why will Vietnam enjoy such a strong competitive advantage? Somphob says it is because the Vietnamese have invested far more in education, in science and in technology than most other ASEAN countries. He foresees that, within five years, Vietnam will also become competitive in information technology and biotechnology.

Because Vietnam's minimum wage is only one third of Thailand's, Somphob says his country has to move into service-based industries where it is likely to enjoy an upper hand for a long time, such as tourism and entertainment. But he also argues that Thailand must improve its own educational system in order to compete effectively in high-value manufactured products, an area in which it could eventually face competition from Vietnam as well as China and India.

Singapore, the leading service economy in Southeast Asia, has continued to concentrate on high-value manufactured products like semiconductors. But even Singapore is taking advantage of Vietnam's hard-working, low-cost labor force. It is the newest W.T.O. member's second biggest source of foreign investment, after Taiwan.

VOA 11/7/06

Intel to invest up to $1B in Vietnam

2006-11-07T17:43:00.000-08:00

HANOI, Vietnam (AP) -- Intel Corp., the world's largest chipmaker, has received permission to increase its initial investment in Vietnam from $300 million to up to $1 billion, a Vietnamese official said Tuesday.

Intel is constructing a $300 million chip assembly and testing plant in Ho Chi Minh City. Its original license, granted in February, allowed the company to invest up to $605 million.

The government has since approved an amended license allowing Intel to invest up to $1 billion and increase its production capacity, said Nguyen Anh Tuan, director of the Information Technology Industry at the Ministry of Telematics.

The deal is considered a significant step forward in Vietnam's campaign to attract foreign investors. It is already the largest single U.S. investment in the country since the Vietnam War ended in 1975.

Intel has scheduled an announcement for Friday in Ho Chi Minh City, but would not disclose its specific plans.

Tuesday's development comes on the same day that the World Trade Organization is scheduled to approve Vietnam's entry into the Geneva-based body and just days before it hosts the Asia-Pacific Economic Cooperation summit, which will draw heads of state and business executives from around the globe.

Construction of the plant, which will employ 1,200 people, is expected to be finished in 2007. It will be Vietnam's first semiconductor facility, and Intel's sixth testing facility in Asia.

In 2005, computer and electronic equipment exports from Vietnam rose 34 percent to $1.44 billion, while imports of computers and electronics rose 26.3 percent to $1.7 billion.

Land owners without certification left out in the cold

2006-11-06T18:07:00.000-08:00

Two companies in Ho Chi Minh City sold land plots to residents, but failed to provide them access to land use certification, meaning they now own the land, but cannot build a house to live in.

In 2002, the Real Estate Joint-Stock Company 7 put 80 housing plots totaling 9,300 sq.m in Go Vap districts Ward 11 on sale.

Under contract terms, the company was to complete required formalities to obtain government-issued land use certificates which are equivalent to land titles in the West for its clients after one year.

However, it has failed to do so without any explanation.

Without the certificates, landowners cannot build anything on their plot since that is illegal.

Last year, the city inspectors came and promised the hapless buyers they would ask the government to issue the certificates.

But again, no action has been taken.

Another case involved the Ho Bac Trading and Housing Limited Company which sold 58 plots in 2001 covering 8,356 sq.m in Tan Binh districts Ward 15 at VND230-VND300 million ($18,750) per plot.

The enterprise also kept silent about the certification issue.

After waiting for a long period of time, several de facto landowners became impatient and started construction on their land, only to be fined and have their houses dismantled by the city government.

One such victim - Le Thai Binh - was indignant that the government only fined those who spent their own money to build houses on the lands they legally bought and did not take any action against the seller, who failed to produce the certificates, for breaking contracts.

The plot thickened even further after Thanh Nien found out Dong Nam Company had bought 7 plots and built workshops there.

Dong Nam has been operating inside the residential areas for many years but remained unharmed.

TNnews 11/6/06

15 days for business registration in Vietnam

2006-11-05T20:11:00.000-08:00

VietNamNet Bridge (11/5/06) The Ministry of Planning and Investment (MPI) is compiling an inter-ministerial circular on the one-stop mechanism in business registration, which is hoped will simplify administrative procedures.

The inter-ministerial circular will dictate how relevant ministries will coordinate on the business registration. It is expected that the time needed to register a business will be shortened to 15 days.

The draft circular is now open for opinions from ministries.

Under the draft circular, the business registration agency will have to give an answer on businesses applications within 15 working days after the day of official file submission. Investors applying for changing stamp models or changing tax registration contents will receive an answer within 12 days.

Provincial and municipal planning and investment departments will be the agencies in charge of receiving applications and giving the answer on whether or not business registrations are accepted.

Regarding administrative reform in business registration, MPI is implementing a programme on renovating the business registration mechanism, aiming for the one-stop mechanism, while providing standardised services at reasonable fees in all localities nationwide.

To reach that end, MPI has suggested the application of a business code scheme, under which every business will be granted a business code. The code will be like the name of the business and accepted by all state management authorities.

The above mentioned programme has been kicked off by MPI and it will be applied in all 64 cities and provinces nationwide. In the near future, investors will have to submit only one file to one agency to get the business code and have their business registered.

MPIs officials said that the standardisation of the business registration process will pave the way for the new process of computerisation and automation in business registration.

The one-stop mechanism, or the three-in-one scheme, will allow for the registration of businesses and the acquisition of stamps and tax codes at the same time, and from one agency.

Registering businesses in Vietnam currently involves complicated and time-consuming procedures due to ineffective coordination among relevant authorities. The recently released report on the global business climate showed that it took 50 days on average to fulfil three official administrative formalities and six other additional procedures to get a business registered.

The total expenses a business has to pay to join the market is equal to 50% of the average income per capita, which is 25 times higher than the worlds average level.

Lotte Shopping to open discount stores in Vietnam

2006-11-05T20:09:00.000-08:00

Lotte has signed a joint venture contract with Vietnam's Minh Van Manufacture Trade Private Enterprise in December and plans to invest $15 million to establish Lotte Vietnam Shopping Co., the company said in a statement.

The first store is planned for Ho Chi Minh City in the first half of 2008, Lotte said. It plans up to 20 stores in major cities including Hanoi in the longer term, it said.

Lotte, South Korea's largest department store operator, is venturing overseas at a time when fierce competition and slowing consumer demand are pressuring margins in the country's mature $120 billion retail industry.

The company runs the third-biggest discount store, Lotte Mart, in South Korea and aims to open a department store in Moscow by the end of the year.

Lotte Shopping, faced with a glut of retail outlets at home in South Korea, has won approval to set up discount stores in Vietnam and plans to open the first outlet in early 2008, the company said on Sunday.
TNnews 11/5/06

Korean mission to visit Vietnam for business opportunities

2006-11-05T00:26:00.000-08:00

Announcing this, the Korea Trade Investment Promotion Agency (KOTRA) in Ho Chi Minh City said in a press release that executives from 50 companies making cosmetics, home appliances, automobile accessories, medical equipment, printing materials would join the mission.

The trip was aimed to help businesses in the two countries look for business opportunities and set up cooperation.

KOTRA would organize a conference in HCMC on promoting cooperation in trade and investment between Vietnam and South Korea on November 20.

The visiting executives would meet their local counterparts the next day at a city hotel to discuss cooperation.


Representatives of a South Korean online game business (L) is working with their Vietnamese counterpart

A South Korean business mission led by the countrys trade minister will visit Vietnam on November 19-21 to promote business opportunities.

TNnews 11/5/06

Vietnam's automobile imports fall in 10 months

2006-11-05T00:25:00.000-08:00

In the period, the country imported some 10,000 completely- built automobiles worth 168 million dollars, posting respective declines of 33.5 percent and 31.8 percent.

Vietnam imported 17,000 automobiles totaling 280 million dollars in 2005, seeing respective decreases of 24.3 percent and 13.2 percent against 2004.

Automobile producers and assemblers in the country generated total sales of 26,890 vehicles in the first three quarters of this year, a year-on-year decline of 5 percent, according to the Vietnam Automobile Manufacturers Association (VAMA).

The carmakers are reducing their products' prices, offering more attractive promotional campaigns and better after-sales services, in a move to boost their sales.

The price reduction race will become hotter late this year when Vietnam becomes a member of the World Trade Organization, and the domestic demand for automobiles, especially cars, is often higher than other times during a year, many local trade experts predicted.

Vietnam currently houses 13 automobile joint ventures with total registered capital of nearly 700 million dollars and combined annual capacity of 173,000 units.

By mid-2005, every 145 Vietnamese people had a car, compared with the rate of 4-5 in Malaysia, 9-10 in Thailand and 30-32 in the Philippines, VAMA said.

Vietnam spent US$551 million importing automobiles and spare parts in the first 10 months of this year, a year-on-year drop of 39.5 percent, the country's General Statistics Office said Thursday.
TNnews 11/3/06

Vietnam�s national historical museum project gets nod

2006-11-05T00:21:00.000-08:00

Construction of the museum, to occupy 10 hectares in a new residential area near Tay Ho (West Lake), is scheduled to begin next year.

The museum, due to open in 2012, will also be a center providing information and data on Vietnams cultural and historical heritages.

The Vietnamese government has approved a project to build the National Historical Museum, the largest in Vietnam, where the 4,000-year old history of Vietnam will be displayed.

TNnews 11/4/06

Teenagers rule the Internet in Vietnam

2006-11-05T00:20:00.000-08:00

About 86 percent of respondents in the 15-19 age group were comfortable surfing the net, while the 20-24 age group recorded at 74 percent proficiency.

Overall, only 45 percent of respondents could surf the web.

Taylor Nelson Sofres also conducted a study on consumption trends over the past ten years and forecasted changes in how Vietnamese people use their disposable income.

The firm's study showed that 69 percent of Vietnam's population is below the age of 35 with slightly more than half under 25.

Vietnamese youths between the age of 15 and 19 are the most skilled group at using the Internet, according to a survey by market research firm Taylor Nelson Sofres.
TNnews 11/5/06

Individual income tax bill opened to public scrutiny

2006-11-05T00:11:00.000-08:00

The full draft has been posted on the ministrys web site at www.mof.gov.vn, and the drafting board assured that all opinions and arguments would be considered to perfect the bill, which is expected to take effect in 2009.

The ministry said it had carefully studied individual income tax systems of many other countries in drafting the bill.

Payable on a monthly basis, the proposed personal income tax will be based on the progressive tax system, with taxes ranging from 5% to 35% on taxable incomes starting at VND5 million ($311).

Taxpayers would enjoy tax relief which are claimable as tax deductions and come in the forms of earned income relief and dependant relief.

For earned income relief, which is automatically accorded to each taxpayer, the draft proposed two options of VND4 million or VND5 million ($250 or $311).

Relief for each dependant will be 40 percent of the earned income relief, meaning VND1.6 million or VND2 million ($100 or $124).

The bill also proposes imposing a 5 percent tax on monthly bank interest of over VND5 million ($311).

Currently, high incomers in Vietnam pay individual income tax in accordance with the Ordinance on high income taxes, which does not count dependant relief.

The finance ministry said the people would pay less income tax under the new bill, citing an example of a person with two dependants whose income was VND10 million ($620) would have to pay only VND60,000, instead of the current rate of VND500,000.

It would not discourage people from depositing money in banks as feared by many, it added.

For example, a person with a bank account of VND800 million ($50,000) would have to pay a mere VND30,000 ($1.8) a month.

Vietnams finance ministry has asked for public opinions and contribution to its draft individual income tax, especially controversial provisions about variable income rates and tax on bank interest.
TNnews 11/4/06

Chinese youth delegation calls on Thanh Nien

2006-11-05T00:10:00.000-08:00

Editor-in-Chief Nguyen Cong Khe briefed the visitors on the newspapers activities and the projects it had on the cards.

Besides a print daily with a circulation of around 500,000, the newspaper had a website each in Vietnamese and English drawing large readership.

Thanh Nien had also set up a representative office in Thailand and planned to establish another in the Czech Republic.

Khe expressed a desire for increased exchanges with the China Youth Daily with which Thanh Nien has had relations since 1999.

Speaking on behalf of the Chinese delegation, Secretary of the China Youth League, He Junke, hailed Thanh Niens contributions to Vietnams development and stressed the need for building a rapport between the youth unions of the two countries.

Chinas Communist Youth League held its first national congress in Guangzhou in 1922 when it proclaimed its establishment.

It changed its name several times since before, in 1957, finally becoming the Communist Youth League.


Editor-in-Chief Nguyen Cong Khe presents a gift to Secretary of the China Youth League, He Junke TNnews 10/29/06

A Chinese Communist Youth League delegation discussed increased cooperation with Vietnam when it paid a visit to the Thanh Nien office on Saturday.

United Airlines enjoys double digit growth in Vietnam

2006-11-03T22:05:00.000-08:00

Joe Mannix, who was addressing a press conference in Ho Chi Minh City, declined to give specific numbers, saying the information was sensitive because of the competition.

He was upbeat about prospects for strong business growth in Vietnam based on past performance and promising signs for the future.

In the middle of October United financed a working trip to Vietnam for eight freelance American journalists specializing in travel. They have checked out what the country has to offer and will promote Vietnams diverse tourism features, he said.

United has been operating in Vietnam since December 2004, and the number of travelers from the US to Vietnam has almost doubled since. We are proud to have contributed significantly to this."

United is the only US carrier flying to Vietnam, operating a daily Boeing 747 service between San Francisco and HCMC via Hong Kong.

In related news, United has picked the Vietnam unit as the winner of its top On-Time Performance Award for punctuality in September.

Mannix was particularly pleased because United Airlines Vietnam had won it in June too. These awards recognize our staffs efforts at Tan Son Nhat Airport, he said.

United Airlines, the worlds second largest carier, has recorded double digit growth in passenger traffic to Vietnam, its general manager in Vietnam said Thursday.

TNNews 11/3/06

China, Vietnam: Close economic ties

2006-11-03T06:47:00.000-08:00

The Asia Pacific Economic cooperation or APEC annual meeting will be held in Hanoi in the middle of this month. China is Vietnam's biggest trade partner. Just this year, the trade volume between two countries hit eight billion US dollars in the first eight months.

On the streets of Hanoi, APEC signs are everywhere. The annual APEC meeting will begin November 12 through November 19 in Vietnam. People there are calling November the "month of APEC". For now, the meeting is the most important economic event in the country.

Emulating China, Vietnam started its economic open policy in 1986. Since then, the country has attracted foreign investment from over 70 countries and regions.

This is a clothing firm operated by a Chinese company. It is also the biggest factory in north Vietnam. Their products have been sold to Europe and America.

Xia Enbing, Executive of Full Wealth Intl. Garments said: " The factory hires 1500 workers. It helps solve the employment problem and also boosts the local economy. "

So far, more than 400 Chinese firms have invested in Vietnam in various fields including tourism, agriculture and high tech. To date, the total investment has exceeded 800 million US dollars.

Official of Vietnam Industrial and Commercial Asso. said: " We think Chinese businesses play an important role in the Vietnamese economy. They contribute to our export sector and employ our local labour force. In total, 12,000 Vietnamese have been hired so far by Chinese firms operating in Vietnam. "

Besides direct investment, China is also Vietnam's biggest trade partner. Based on the free trade agreement, most Chinese products enter the country with zero tariff.

On November 7, Vietnam will enter the World Trade Organization. Hanoi's formal entry into the world body is expected to further strengthen Vietnam's economy, and trade ties with other members, including China.

CCTV 11/2/06

Vietnam to axe tariffs for WTO entry

2006-11-03T06:43:00.000-08:00

Vietnam will slash import taxes and open up some industries for foreign investors under its commitment made to enter into the World Trade Organization (WTO), the local newspaper Saigon Liberation reported on Friday.

Vietnam, scheduled to become a WTO member on Nov. 7, will lower the average import tax of all tariff lines from current 17.4 percent to 13.4 percent gradually within 5-7 years upon the WTO accession. Specifically, over one third of all 10,600 tariff lines, mainly those having tax rates of more than 20 percent, are subject to tax reduction and removal.

Products slated for biggest tax reductions include garment, textiles, fishes and related products, wood, paper, some kinds of manufactured goods, machines, and electrical and electronic equipment.

The average import tariff levied on farm produces is to decrease from current 23.5 percent to 20.9 percent within five years, and that on industrial products will be slashed from current 16.8 percent to 12.6 percent within five to seven years.

However, Vietnam will still remain certain protection on major products, including farm produces, cement, steel, construction material, automobile and motorbike. It will also maintain placement of quota tariffs on the four imports: sugar, poultry egg, tobacco and salt.

Within the quota, the tariff on poultry eggs currently stands at 40 percent, crude sugar 25 percent, refined sugar 40-50 percent, tobacco 30 percent, and salt 30 percent. If the import volume exceeds the quota, the tariff will be higher.

Vietnam has pledged to abolish agricultural export subsidy. Some modes of state assistance in the form of agricultural production promotion are not subject to removal, but the assistance cannot exceed 10 percent of the value of total agriculture output.

The country has also pledged to remove trading rights discrimination among foreign and domestic enterprises and individuals. Specifically, state-owned enterprises in Vietnam are to maintain rice export monopoly till 2009, and pharmaceutical import monopoly till 2011. However, foreign enterprises and individuals will have the rights to only import pharmaceuticals into Vietnam, not distribute them in the country.

Vietnam will allow import of motorbikes with capacity of over 175 cubic centimeters on July 31, 2007, and remove import limitations on cigarettes and cigars upon WTO accession. However, only state-owned enterprises have the rights to import cigarettes and cigars.

The WTO has given Vietnam a two-year timeframe to revise its luxury taxes levied on alcohol and beer.

Regarding the opening up of such services as telecommunications, banking and securities, Vietnam has, basically, made commitments which are similar to those in the Vietnam-U.S. bilateral trade agreement (BTA). The country has pledged to completely open up the goods distribution field to foreigners on Jan. 1, 2009, 19 days later compared with the BTA.

Vietnam will open up the field of distributing such key industrial products as steel, cement and fertilizer three years after the accession. It will not open up the field of distributing petroleum products, pharmaceuticals, books, magazines, video tapes, cigarettes, rice, sugar and precious metals.

Concerning general commitments toward services, foreign companies will be allowed to send managers to Vietnam, but the percentage of Vietnamese managers must be at least 20 percent.

Vietnam has agreed to permit foreign firms to establish wholly foreign-owned enterprises in Vietnam five years after the WTO entry to provide assistance services to the exploitation of oil and gas. However, some areas like flight service and the provision of equipment and materials to offshore oil rigs are conducted by only Vietnamese enterprises.

The WTO's General Council will formally approve the accession terms for Vietnam on Nov. 7, the newspaper said. It will officially become the organization's 150th member 30 days after its top legislature, the National Assembly, approves the accession agreement.

Source: Xinhua

Dragon Capital's Vietnam Drive Brings Investors an 88% Return

2006-10-27T06:34:00.000-07:00

Oct. 26 (Bloomberg) -- When Dominic Scriven first came to Vietnam in 1990, the country had no stock exchange.

Today his company, Dragon Capital, manages $860 million of assets that include shares in more than half of the companies on Vietnam's six-year-old stock market. And he's beating that market. The company says it is the biggest investor on the Southeast Asian nation's exchange after the government.

``Vietnam isn't a short-term investment destination,'' said Ho Chi Minh City-based Scriven, 43, in an interview in Hong Kong. The key to success is ``being patient.''

His patience has been rewarded. His flagship fund, Vietnam Enterprise Investments Ltd., has returned 88 percent this year after losing a third of its value in its first six years. The benchmark Vietnam Ho Chi Minh Stock Index has a total return of 73 percent in 2006. That compares with a 6.5 percent gain for the Morgan Stanley Capital International Asia-Pacific Index.

Assets of the fund, known as VEIL, have ballooned to $500 million from $16 million when the fund was started in 1996, according to Scriven. Among the stocks that have contributed to his performance are Saigon Thuong Tin Commercial Joint-Stock Bank, known as Sacombank, and Refrigeration Electrical Enterprises Corp.

Shares of Sacombank, which in July became the first bank to list on the Ho Chi Minh City Securities Trading Center, have risen at least fivefold since the fund bought the stock in 2000. VEIL paid $8 million in 1996 for Asia Commercial Bank shares; now the stake in the unlisted bank is worth $80 million.

``We started early'' with banks, said London-born Scriven, who has lived in Vietnam since 1991 and speaks the language fluently.

Limited Market

Vietnam's Communist Party-led government has been slowly shifting to a market-based economy since establishing closer ties with the U.S. by opening diplomatic relations in 1995 and signing a trade accord in 2001.

The market remains nascent. The stock exchange lists 51 stocks with a market value of $3.2 billion and the value of companies traded in the over-the-counter market in Vietnam may be as much as $6 billion, according to HSBC Holdings Plc. The companies listed on Thailand's stock exchange, by contrast, have a market value of $138 billion.

``The listed market is still limited in size,'' said Horst Geicke, chairman of VinaCapital Ltd. It manages two London- listed funds that have raised about $575 million to invest in Vietnam.

Getting Out

An average of just $7.8 million of Vietnamese shares traded daily in the past three months, compared with $18 billion on the first section of the Tokyo Stock Exchange, the world's second- biggest equity market.

That lack of depth can make it difficult for large investors to sell shares without pushing down prices.

``Our biggest concern is getting investments on sensible terms so you have a chance to get it back out,'' said Alex Hambly, Ho Chi Minh City-based head of Prudential Plc's fund management unit in Vietnam, which is raising a $250 million to $300 million offshore fund to invest in the country.

Scriven said that because it is committed to long-term investment in Vietnam and chooses less risky industries, Dragon Capital is less likely to need to exit the market rapidly.

``Certainly we would have a very significant problem if we wanted to liquidate all our holdings,'' he said. ``The vast bulk of our investments are in the core sectors: the financial sector, power, ports, shipping. They have larger scale, more predictability, more visibility, and hence more risk protection.''

Vietnam's Banks

When Scriven arrived in Vietnam, the nation was grappling with an inflation rate of 65 percent and an annual foreign trade turnover of $5 billion.

Today, Vietnam is targeting annual expansion of as much as 8 percent through 2010. The economy has expanded more than 7 percent every year since 2002. Vietnam's credit rating, two levels below investment grade at Standard & Poor's, is higher than regional neighbors Indonesia and the Philippines even though they have more mature financial markets.

One-third of the VEIL fund is invested in banks. Apart from lenders, Scriven favors insurance, roads, health-care, natural resources and consumer goods companies. He bought 24 percent of Refrigeration Electrical in 1997 when the company was worth $20 million. Its market value has gone up to more than $150 million. The shares have surged between five and six times since the company first listed its stock in July 2000.

Dragon Capital, which also manages the $260 million Vietnam Growth Fund Ltd. and the $100 million Vietnam Dragon Fund, says it controls shares equivalent to about 12 percent of Vietnam's stock exchange.

Closures

Scriven graduated in 1985 with a degree in law and sociology from Exeter University. He has worked in Asia for 18 years, as a fund manager at Sun Hung Kai & Co. in Hong Kong and at Citicorp Investment Bank in London and Hong Kong.

Scriven studied Vietnamese in Hanoi for two years after he arrived and then headed for the national business hub of Ho Chi Minh City. He and John Shrimpton, who has been living in Vietnam since 1996 and is also based in the city, set up Dragon Capital in 1994. The company now employs 60 people, some of whom do due diligence on Vietnamese companies.

By sticking it out in the nation of 84 million people through the 1997-98 Asian financial crisis and stock market slumps in 2001 and 2003, Scriven has outlasted his peers.

Lazard Fund closed in 1997 five years before its initial scheduled expiry date because the fund's manager said bureaucratic obstacles made investing in Vietnam too difficult. The Templeton Vietnam Opportunities Fund Inc. closed its Vietnam office in 1998 after investing only about one-seventh of its assets in the country.

Bird Flu

The Vietnamese government has been privatizing state-owned businesses and encouraging the more than 3,000 companies traded on the over-the-counter market to move to the main board. Its market value may double to $7 billion by the middle of 2007, according to a Credit Suisse report earlier this month.

Yet the market is vulnerable to external shocks such as epidemic, said Prudential's Hambly. Any outbreak would jeopardize the country's exports and crimp investment sentiment, he said.

Vietnam has the highest number of bird-flu cases recorded by the World Health Organization since 2003 and the highest number of fatalities after Indonesia. In the previous three years, 93 people were infected in Vietnam, 42 of them fatally.

The country, which expects to become a World Trade Organization member in December, is dependent on trade. Exports almost doubled to $32.4 billion between 2002 and 2005. A WTO working group on Vietnam's accession is meeting this week to approve a report on the country becoming a WTO member, said Walter Blocker, American Chamber of Commerce chairman in Ho Chi Minh City, speaking on Oct. 24 at a group lunch in the city.

``We're interested in the bigger picture, the development of Vietnam,'' Scriven said. ``That means accepting there's going to be a certain degree of risk. Pulling out of Vietnam is not an option for me.''

UBS says to trade shares in Vietnam stock markets

2006-10-18T21:55:00.000-07:00

HANOI, Oct 18 (Reuters) - Fund manager UBS AG said on Wednesday it had received a licence to buy and sell securities in Vietnam as part of its business expansion in Asia's emerging markets.

UBS said in a statement it also had a brokerage agreement with Ho Chi Minh City-based Bao Viet Securities Company to execute UBS orders in Vietnam's stock markets.

"The country is rich in resources, unlike many others in the region, is a net oil exporter and we are confident that it will increasingly become the focus of international investors," Chi-Won Yoon, head of Asian Equities at UBS Investment Bank, said in the statement.

Bao Viet Securities officials told Reuters they had not yet received any orders from UBS clients but they expected business transactions soon.

The Ho Chi Minh City Securities Trading Centre is Asia's fastest growing exchange this year but its capitalisation is only about $3.2 billion with 51 listed companies. Hanoi has an over-the-counter stock market.

Foreign investors in the communist-run country are allowed to own up to 49 percent of most listed firms and the limit is 30 percent for banks.

Vietnam's stock market expands with new listings

2006-10-04T19:04:00.000-07:00

Thanh Nien News 10/4/06 More domestic companies, including Vietnam's fifth-largest bank by assets, Asia Commercial Bank (ACB), are racing to win a share listing license before changes to corporate tax laws start on Jan. 1, 2007.

The government has said a 50-percent corporate tax relief granted to listed companies for the first two years after their listing will no longer be available after the end of 2006.

Last Friday, Vietnam also licensed the listing of SMC Investment and Trading Company, the first firm from the country's steel sector to join the exchange, along with Malaysian-owned food firm Interfood.

In addition, Sacombank , the first bank to list when it debuted in July, was on Tuesday allowed to issue 19 million new shares in a 1-for-10 share scheme to boost its registered capital. The bank at present has nearly 190 million shares in circulation.

Dong Nai Roof Sheet and Construction Material Co (Donac), with a market value of $18 million, will list on Oct. 10 all of its 12,097,346 shares on the Ho Chi Minh City exchange.

50th stock to list

A State Securities Commission statement said the trading code for Donac was DCT. It will become the 50th stock to list on the bourse, which was opened in 2000.

Based in the southern province of Dong Nai, Donac produces and trades construction materials. It said its roofing sheets account for 40 percent of the domestic market.

Donac's net profit last year rose 14.4 percent from 2004 to VND17.25 billion ($1.08 million).

Malaysian-owned Interfood Shareholding Company said on Wednesday it will debut with more than 5.7 million shares, or 23.59 percent of its total shares, on the exchange on Oct. 17.

Dong Nai province-based Interfood, valued at around $40 million, produces canned food, soft drinks and fast food for domestic markets and export.

First listed steel firm

Ho Chi Minh City-based SMS will list all of its 6 million shares. SMC's market value or debut date were not immediately clear, and officials could not be reached for comment.

SMC director Nguyen Ngoc Anh told state media the company controlled 3 percent of domestic steel markets in 2005.

"Beside trading, SMC will expand into the area of steel manufacturing," Anh was quoted by Wednesday's state-run Vietnam Economic Times newspaper as saying.

SMC would invest VND40 billion ($2.5 million) in a factory to process steel in the southern province of Ba Ria-Vung Tau, Anh told shareholders in late September.

ACB hopes to make its debut before the year end after receiving central bank permission last month.

Earlier in September, a State Securities Commission official said that by the end of 2006 at least seven firms would be licensed to list, boosting the bourse's capitalisation to 8.5 percent of gross domestic product, from 7.6 percent in September.

The Vietnam Index closed 0.75 percent up at 541.91 points on Wednesday, having surged 76.2 percent since the end of 2005.

Vietnam's stock market, home to Asia's best performing index this year, will trade shares in two more companies this month, and other new listings and share issues are under way, regulators said on Wednesday.

Senators urge Bush push for Vietnam trade deal

2006-09-08T16:09:00.000-07:00

WASHINGTON Post (Reuters 9/8/06) - Two U.S. senators urged President George W. Bush on Friday to push for swift approval of a Vietnam trade bill held up by textile industry concerns and election-year politics.

"Granting Vietnam PNTR (permanent normal trade relations) would be a move of great historic and commercial value," Sens. Max Baucus, a Montana Democrat, and Gordon Smith, an Oregon Republican, said in a letter to Bush.

The Bush administration completed an agreement in May clearing the way for Vietnam to join the World Trade Organization by the middle of October and normalize trade relations between the two former battlefield enemies.

It is a mostly one-sided deal that requires Vietnam to open its markets to more U.S. farm goods, manufactured products and services such as banking and telecommunications.

The United States would be required to lift quotas it now imposes on clothing imports from Vietnam because such restrictions are a violation of WTO rules.

Two members of Bush's Republican Party -- Sen. Elizabeth Dole of North Carolina and Sen. Lindsey Graham of South Carolina -- are blocking consideration of the agreement in the Senate because of textile concerns.

Republicans in the House of Representatives are also reluctant to vote on any trade deals that could make it easier for Democrats to wrest control of the House in the November 7 congressional elections.

Business groups worry that waiting until after the election to vote on the Vietnam bill could be a risky move, especially if a big Democratic victory makes it politically difficult for Republicans to get anything done.

There would also be little time for both the House and the Senate to approve the bill before Bush goes to Hanoi for the annual APEC summit meeting on November 18 and 19.

A spokesman for the U.S. Trade Representative's Office said winning approval of the Vietnam trade bill was a priority for the Bush administration.

Vietnam to issue more bonds after ratings upgraded

2006-09-08T16:08:00.001-07:00

Thanh Nien News 9/8/06 "Vietnam should take this opportunity to continue the issue of government bonds on international markets," Ninh was quoted by the Quan Doi Nhan Dan (People's Army) newspaper as saying.

On Thursday, S&P upgraded Vietnam's foreign currency rating by one notch to BB and lifted its domestic currency rating to BB+ from BB, citing economic reforms.

The outlook for the ratings was stable and Vietnam is now rated one notch higher than the Philippines and Indonesia. Its sovereign dollar bonds rose after the S&P announcement.

Last October, Vietnam sold its debut eurobond worth $750 million while investors put in bids of more than $4.5 billion. Hanoi said the issue helped set a benchmark for the country's creditworthiness and similar issues by domestic firms.

The proceeds of the eurobond went to state-run ship builder Vinashin.

In March, the government said it would support the energy, banking, telecoms and aviation sectors in tapping global capital market for funds to fuel growth of one of the fastest growing Asian economies.

The power sector plans international bonds to bridge a shortfall of nearly $7 billion needed to build new power plants.

The government has said it needed $150 billion to invest in the economy in the five years ending in 2010 to ensure economic growth of between 7.5 percent and 8 percent.

It said Vietnam's GDP should expand 8 percent this year.

Vietnam should take advantage of a currency ratings upgrade by Standard & Poor's to tap global capital markets, Finance Minister Vu Van Ninh was quoted by state media on Friday as saying.

Vietnam ICT firms headed for Singapore forum

2006-09-08T16:08:00.000-07:00

Thanh Nien News 9/8/06 The Ho Chi Minh City Computer Association (HCA) said it would organize an ICT delegation for the Vietnam Ho Chi Minh City Days Program to be held under framework of the forum.

The delegation would showcase the capabilities of Vietnamese ICT enterprises and meet with investors, government agencies, and international firms.

The forum would include a special seminar on Vietnams software industry, the HCA said, to acquaint international IT firms about Vietnams software industry and the governments open policy.

Vietnam has averaged annual IT growth of 20 percent in recent years, according to the International Data Group.

Leading Vietnamese information and communication technology (ICT) firms will scout for business opportunities at the International Enterprise Forum to be held next month in Singapore.

SSA Marine's terminal venture in Vietnam OK'd

2006-09-07T16:17:00.000-07:00

Pacific Northwest

A joint venture between Seattle's SSA Marine and Saigon Port received the green light from Vietnam's government to build an international container terminal at Cai Mep, outside Ho Chi Minh City.

The $160 million project is expected to be in operation in 2009, said Bob Watters, SSA vice president. It will shift traffic from congested city ports to Ba Ria-Vung Tau Province, south of the city. Ho Chi Minh City's ports handle about as many containers a year as Seattle or Tacoma and are growing about 20 percent a year.

Seattle Times 9/7/06

US Treasury Secretary supports normal trade ties with Vietnam

2006-09-07T16:16:00.000-07:00

Thanh Nien News 9/7/06

In his meeting Thursday with Prime Minister Nguyen Tan Dung, Paulson, who is in Hanoi for an Asia-Pacific finance ministers meeting, also appreciated the country's reform achievements, the report said.

The Secretary said he hoped that the relationship between the Vietnamese Ministry of Finance (MoF) and the US Department of the Treasury (DoT) would progress in the future.

The report quoted PM Dung as saying that he was pleased at the development of the relationship between Vietnam and the US, manifested in US support for Vietnam's bid to join the World Trade Organization.

Dung affirmed Vietnam's consistent policy of boosting mutually benefited cooperation in all areas, particularly trade, investment and education and training.


Prime Minister Nguyen Tan Dung (R) and US Treasury Secretary Henry Paulson

US Treasury Secretary Henry Paulson said in a meeting with Vietnams PM he would endeavor to expedite the normalization of trade relations for Vietnam in the US Congress, the Vietnam News Agency reported.

VIETNAM'S OVERSEAS INVESTMENT KEEPS INCREASING

2006-09-07T13:20:00.000-07:00

HANOI, Sept 7 Asia Pulse - The Planning and Investment Ministry's Foreign Investment Department has reported that in August, Vietnam invested in 18 overseas investment projects with a total registered capital of US$287.3 million.

Consequently, the country has now invested a total of 184 overseas projects worth $937.3 million over the past eight months.

Overseas investment by Vietnam has been mainly in Laos, Cambodia, the US, Malaysia and Singapore, the department said.

The Vietnam Oil and Gas Corporation (PetroVietnam) increased its investment in Algeria by US$208 million and its oil exploration and exploitation project in Singapore is capitalised at $21.94 million.

Vietnam has invested in building a trade centre in Moscow, Russia, with a capital of $35 million, and a hospital in Cambodia worth $10.5 million.

Vietnam has also invested $12.54 million in industrial and agricultural plants in Laos.

VIETNAM'S OVERSEAS INVESTMENT KEEPS INCREASING

2006-09-07T13:19:00.001-07:00

Consequently, the country has now invested a total of 184 overseas projects worth $937.3 million over the past eight months.

Overseas investment by Vietnam has been mainly in Laos, Cambodia, the US, Malaysia and Singapore, the department said.

Vietnam has invested in building a trade centre in Moscow, Russia, with a capital of $35 million, and a hospital in Cambodia worth $10.5 million.

Vietnam has also invested $12.54 million in industrial and agricultural plants in Laos.

VIETNAM'S OVERSEAS INVESTMENT KEEPS INCREASING

2006-09-07T13:19:00.000-07:00

Consequently, the country has now invested a total of 184 overseas projects worth $937.3 million over the past eight months.

Overseas investment by Vietnam has been mainly in Laos, Cambodia, the US, Malaysia and Singapore, the department said.

Vietnam has invested in building a trade centre in Moscow, Russia, with a capital of $35 million, and a hospital in Cambodia worth $10.5 million.

Vietnam has also invested $12.54 million in industrial and agricultural plants in Laos.

VIETNAM A POTENTIAL MARKET FOR FOREIGN INVESTMENT: CONSULTANT

2006-09-07T13:18:00.001-07:00

HANOI, Sept 7 Asia Pulse - Carl Delfeld, President of the global Chartwell Partners consultant company and Editor-in-Chief of the Chartwell Advisor newspaper, stressed that the potential payoff of investing in Vietnam makes it worth the risk.

In his article, posted on August 24 in Forbes magazine, Carl Delfeld talked about the opportunity that the giant financial services company Merrill Lynch has won in Vietnam, and that Merrill obtained the right to directly hold Vietnamese shares.

"Vietnam is slightly larger than New Mexico in size, but it has a population of 85 million people, half of whom are younger than 25," he said, adding that Vietnam's economic growth rate of 8 per cent is close to that of China, and its manufacturing capability has a long way to go. Meanwhile, wage rates in Vietnam are lower than in neighboring countries, and the service side of the economy is thriving.

In addition, Vietnam's market liberalisation and reform is sporadically moving ahead, Delfeld said, adding that the country is also gradually becoming integrated into the global economy.

"For long-term, far-sighted investors, the attractions of Vietnam are clear: a young and literate workforce that is consumer-oriented, rising foreign direct investment, cost advantages in growing its manufacturing sector, and strong export growth," he said.

The US Chartwell Partners president also spoke of Vietnam's huge potential in developing its tourism.

VIETNAM A POTENTIAL MARKET FOR FOREIGN INVESTMENT: CONSULTANT

2006-09-07T13:18:00.000-07:00

In addition, Vietnam's market liberalisation and reform is sporadically moving ahead, Delfeld said, adding that the country is also gradually becoming integrated into the global economy.

The US Chartwell Partners president also spoke of Vietnam's huge potential in developing its tourism.

S&P lifts Vietnam's rating by one notch to BB

2006-09-07T13:17:00.000-07:00

HONG KONG, Sept 7 (Reuters) - Standard & Poor's said on Thursday it had upgraded Vietnam's foreign currency rating by one notch to BB, citing the country's economic reforms.

The rating agency also lifted the country's local currency rating to BB+ from BB. The outlook on the ratings is stable.

Vietnam's sovereign dollar bonds rose after the announcement.

"The upgrade reflects the increased economic growth potential of the Vietnamese economy, which has resulted from the ongoing efforts of the government to improve essential public infrastructure and the investment climate," S&P credit analyst Kim Eng Tan said in a statement.

"Measures to introduce foreign participation in the domestic banking system have also laid the foundation for greater financial stability going forward," Tan said.

Vietnam is now rated one notch higher than the Philippines and Indonesia.

"The key driver here is the WTO (World Trade Organisation) process. It looks like the WTO is going to be finalised and signed in the next 2 to 3 months," said Scott Wilson, sovereign credit analyst at UBS.

"That's critically important because it locks in the reform programme in Vietnam," he said, adding that Vietnam is an improving sovereign credit.

Vietnam could join the WTO by the end of this year, which will further generate trade and investment opportunities for the country.

Vietnam government spokesman Le Dung said the country's plan to join the WTO was providing an impetus for reform.

"We are also re-doubling our efforts to join the WTO at the earliest possible date and therefore we have incentive to help reform in Vietnam to meet international standards and to get more and more into the world economy," he said.

Vietnam's economy, one of the fastest-growing in recent years after neighbouring China, should expand by 8 percent this year, as targeted, the government said last Friday.

Gross domestic product in January-June rose 7.4 percent from the same period last year, led by construction and industrial sectors.

Its stock market has gained 66 percent so far this year.

Vietnam commercial bank plans $190 mln bond issue

2006-09-06T09:43:00.000-07:00

Thanh Nien News 9/5/06

ACB will offer a first tranche of VND1.65 trillion in the fourth quarter this year and the remaining VND1.35 trillion from next year through 2010.

The coupon rate will be 8 percent per annum but the conversion rate ¨C ie, how many shares will be issued for each bond ¨C has not been announced yet.

"The issue is to increase our financial capacity and competitiveness in preparation for Vietnam¡¯s entry into the World Trade Organization (WTO)," Ly Xuan Hai, ACB¡¯s general director, said.

"We have been preparing since 1996 and we can say we¡¯re ready," he said.

As foreign banks, expected to enter the market when Vietnam joins the WTO, are expected to hold advantages in IT and human resources over Vietnamese banks, the latter are gearing up to defend their turf.

Diversifying products and services was a must for Vietnamese banks, Professor Norbert Walter, chief economist of Deutsche Bank, told a recent meeting in HCM City.

He predicted that foreign banks operating in Vietnam would offer higher-grade products that Vietnamese banks would have trouble matching.

Vietnam¡¯s second largest joint stock bank, Asia Commercial Bank, plans to issue VND3 trillion (US$190 million) worth convertible bonds by 2010.

Franchising to prosper in Vietnam: experts

2006-09-06T09:42:00.000-07:00

Thanh Nien News 9/6/06

It would offer an excellent route for multinational firms to enter Vietnam and for domestic enterprises to expand overseas, market analysts told the seminar hosted by the city¡¯s Investment and Trade Promotion Center.

Franchising is a form of business in which a firm with a successful product or service (the franchisor) enters into a relationship with other businesses (franchisees) to operate under the franchisor¡¯s trade name.

Solid prospects

Last year the franchising market surged 30 percent, with more than 530 new franchisees and the transfer of 800 brands including 100 local brands.

According to global franchisers, Vietnam has all the hallmarks of a franchise haven: a young market, high economic growth, and stable political system.

The Vietnamese government has passed the Franchising Decree, which is expected to help bolster the business in the country.

Han Guang Chou, deputy general director of Han¡¯s Singapore Pte Ltd, a Singapore-based fast food brand, said the company had standardized its model for overseas expansion and Vietnam was its first destination.

McDonald¡¯s Restaurants of the US plan to enter Vietnam early next year after it becomes a full WTO member.

Other big Singapore brands like Charles & Keith shoes, Celia Loe Chapter 2, and fast food makers Bread Talk, Cavana, and Koufu surveyed the Vietnamese market last year and plan to look for franchisees.

KFC opened 17th restaurant in Vietnam earlier this year and plans to top 100 by 2010.

Pioneers

In Vietnam the country¡¯s leading coffee manufacturer Trung Nguyen was in the vanguard of developing the franchising system.

It opened its first franchise in HCMC in 1998 and there are now more than 1,000 in Vietnam and some in Singapore, Tokyo, and Shanghai.

The company is planning to enter the US, Germany, and Australia.

Another example is the Pho 24 restaurants selling Vietnam¡¯s most popular traditional dish, pho, or noodles.

Pho 24 has opened more than 12 outlets in Vietnam, Indonesia, and the Philippines and the figure is expected to go up to 100.

The restaurant has completed final preparations for launching the first Pho 24 in the Republic of Korea next December and in Japan in March next year.

Franchising, which has proved popular in Vietnam, is likely to continue flourishing in the country, foreign experts told a seminar Tuesday in Ho Chi Minh City.

ADB: Vietnam is ��star of Southeast Asia��

2006-09-06T09:40:00.001-07:00

Nhan Dan 9/6/06

¡°Economically speaking, Vietnam is the star of Southeast Asia¡± in terms of economic growth, said Mr Ayumi Konishi, Country Director of ADB¡¯s Vietnam Resident Mission in launching the Asian Development Outlook 2006 Update in Hanoi on September 6.

The Vietnamese economy is expected to see vigorous growth, underpinned by improvements in the country¡¯s business climate and its expected membership in the World Trade Organisations, the Asian Development Bank says in a major report released today.

¡°Growth in private investment, strong consumption and robust exports are driving a dynamic economy,¡± Mr Konishi said. The Asian Development Outlook 2006 Update (ADO Update) forecasts the economy will grow 8.0% in fiscal year 2007, up from 7.8% growth this year.

In Vietnam, ADO Update noted that the implementation of commitments related to the Association of Southeast Asian Nations Free Trade Area and expected WTO accession will provide opportunities for further export growth by allowing the country greater access to international markets.

In addition, surging exports are helping to drive the country¡¯s strong growth. Merchandise exports for the first half of the year jumped 28.8% to 18.8 billion. As a net oil exporter, the country also benefits from rising global oil prices. Exports of textiles and clothing were also strong.

In 2007, exports are projected to increase by about 18%, outpacing import growth and narrowing the country¡¯s trade deficit. Strong remittance inflows are expected to help turn the current account into a slight surplus.

The inflation forecast has been revised up to 8.3% in part because of rises in administered fuel prices to reduce the cost of fuel subsidies. Rising prices for food, housing construction materials and transport have also contributed to the increase in inflation this year.

In 2007, inflation will continue to feel upward pressure from expansionary macroeconomic policies, continued strong domestic demand, and likely wage rises in both public and private sectors.

One challenge facing the economy is the reduction of corruption and this has been recognised by the Government of Vietnam, which has stepped up its efforts on this issue.

ADO Update forecasts overall growth for the 43 countries of developing Asia of 7.7% in 2006, up from its 7.2% forecast in April.

Vietnam ranks 104th in the ease of doing business

2006-09-06T09:40:00.000-07:00

Nhan Dan 9/6/06

Vietnam is ranked 104/175 countries in terms of the ease of doing business, down six ranks from last year¡¯s 98, said the World Bank¡¯s report released at a video conference on Launch of Doing Business 2007.

Vietnam¡¯s down rank indicates that the country¡¯s overall progress in regulatory reforms lags behind other countries and more is needed to be done to make Vietnam more competitive.

The down rank does not mean that Vietnam¡¯s ease of doing business has not been improved but other countries have improved their ease of doing business more quickly and better than Vietnam, said Caralee McLiesh, programme manager and co-founder of the Doing Business Project of the World Bank Group.

This year¡¯s report focuses on reform, updates indicators developed in the three preceding reports and covers 20 additional countries. The report presents quantitative indicators on business regulations and their enforcement compared across 175 countries.

WB¡¯s ranking relies on 10 indicators: Starting a business, dealing with license, employing workers, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and closing a business.

According to the Doing Business 2007 Report, Vietnam is among seven economies in East Asia which implemented one or more reforms that has improved the Doing Business indicators in the reported period.

Vietnam-fastest growing stock market in Asia

2006-09-06T09:39:00.000-07:00

Nhan Dan 9/6/06

In the next few years, the stock market in Vietnam will see further robust growth, Netty Ismail and Stephen Engle quoted economic specialists as saying in an article entitled ¡°Sell-offs could drive market in Vietnam¡± published in the International Herald Tribune on August 31.

The paper quoted Spencer White, Hong Kong- based Asian strategist at Merrill, as saying that, ¡°We are going to see a very significant transformation of the Vietnamese stock market over the next two to three years."

Vietnam, which began market-oriented reform in 1986, has the fastest-growing stock market in Asia, he said.

Currently, there are 48 companies on the six-year-old Ho Chi Minh City Securities Trading Centre with a combined market value of about US $3 billion. Market value on the Vietnamese exchange increased 50% on July 12, 2006 after shares in Saigon Thuong Tin Commercial Joint-Stock Bank (Sacombank) made their debut.

Meanwhile, Kelvin Lee, head of investment banking at VinaCapital Group in Ho Chi Minh City, which manages US $600 million of investments in Vietnam, said that sales of shares in State-owned companies could accelerate stock market growth as the government seeks to sharpen the ability of those firms to compete after Vietnam joins the World Trade Organisation (WTO).

Jonathan Pincus, senior country economist at the United Nations Development Programme in Hanoi, said that having a capital market is very important to Vietnam's future.

A securities law that comes into effect in January seeks to lay out standards of disclosure and governance for all companies, whether they trade over- the-counter or on exchanges. Vietnam is also offering tax incentives for companies to shift the trading of their shares to the stock market, he said. (VNA)

House leader eyes vote on Vietnam trade bill

2006-09-06T09:38:00.001-07:00

WASHINGTON (Reuters 9/5/06) - The U.S. House of Representatives should vote on a trade agreement with Vietnam before President George W. Bush visits the country in mid-November, a top Republican said on Tuesday.

"I see it on the agenda before he goes to Vietnam," House Majority Leader John Boehner told reporters as lawmakers were returning to Washington after a month-long break.

However, the Ohio Republican left open the possibility the House might wait until the week after the November 7 congressional elections to vote on the Vietnam trade bill.

That would be cutting it close because Bush is expected to be in Vietnam on November 18-19 for the annual APEC (Asia Pacific Economic Cooperation) leaders summit.

Many Republicans are wary of voting on any trade deal ahead of this year's election, which Democrats see as their best opportunity in years to win control of the House.

The U.S. agreement with Vietnam paves the way for Hanoi to join the World Trade Organization and would permanently normalize trade relations between the two countries.

It is a mostly one-sided agreement that requires Vietnam to open its markets to more U.S. farm goods, manufactured products and services such as banking and telecommunications.

However, the United States would be required to lift quotas it now imposes on clothing imports from Vietnam because such restrictions are a violation of WTO rules.

The U.S. textile industry has been pushing for changes in the agreement, such as a safeguard mechanism that would allow the United States to reimpose quotas in response to a surge.

The Senate could vote on the agreement this month, even if the House decides to wait until November. However, the textile issue could delay action in the Senate as well.

A pair of textile-state Republicans -- Sen. Elizabeth Dole of North Carolina and Sen. Lindsey Graham (news, bio, voting record) of South Carolina -- have threatened to block a vote on the Vietnam trade bill unless their concerns are addressed.

House leader eyes vote on Vietnam trade bill

2006-09-06T09:38:00.000-07:00