sotetamlich2010

Editorial CommitteeChairman:Nguyen Si CuMembers:Nguyen Thanh Yen (standing) Nguyen Bich LoanVu Ngoc TrangPham The NamEditor-in-Chief:Nguyen Si Cu, Tel: (84.4) 3 5771512Designers: Hai Yen - Le NgocSub-editor: Kara MealerHead Office: 4th Floor, 9 Dao Duy Anh St., Hanoi Tel: (84.4) 3 5743985 / Fax: (84-4) 3 5743063 Email: [email protected]: http://vibforum.vcci.com.vnHanoi Economic Information Dept. 4th floor, 25B Building, De La Thanh Street,Dong Da District, HanoiTel: (84-4) 6275 4809Fax: (84-4) 6275 4835Ho Chi Minh City171 Vo Thi Sau St., Dist.3. Tel: 84.8.39321729; 39321700 ; 39322774

Fax: 84. 8. 39321701 E-mail: [email protected] RepresentativeVU NGOC TRANG Da Nang CityPerson in ChargeHOANG NGOC HAINo. 11 Phan Boi Chau, Da Nang CityTel: 05113.889926Fax: 05113.889926JapanChief RepresentativeMS AKI KOJIMA1-9-5, Hirakawacho, Chiyoda - ku, Tokyo 102-0093Tel: 81-3-5215-7040;Fax: 81-3-5215-1716

Licence No. 236/GP-BVHTT Printed by the Trade Union Printing Co.PRICE: US$ 4.00

Bi-Weekly Magazine Published by VCCI

In this Issue

Cooperation- From Vision to Action ................................................................................................................................4- Premises & Opportunities.........................................................................................................................6

Cooperation- No Giving Way to Difficulties ..................................................................................................................8- Businesses Say No to Corruption...........................................................................................................0- Linking Vietnamese Women .................................................................................................................12- “Continuing to Enhance Tourism, Sports & Culture Activities”................................................14

Economic sector- Vietnam Retail Market to Prevail Soon..............................................................................................16- Toward Sustainable Business Environment ...................................................................................18- Vietnam Economy 2010: A Positive Look.........................................................................................20- Industry 2010: Major Contribution from Economic Groups......................................................22- Agriculture Forestry Fisheries: Toward Professional Production ............................................24- Why Still Employees at Home Market ...............................................................................................26- Visiting Vung Ang to Feel Hustle and Bustle ..................................................................................28- Addressing Barriers for FDI Attraction .............................................................................................28

Local economy- New Status and Strength ...................................................................................................................... 30- Promoting Local Competitive Advantages .....................................................................................32

Enterprises- VINACAFÉ: Know-how in the Taste of Nature.................................................................................36- PTSC: Quality Is a Gauge of Success ...................................................................................................38- Sao Mai An Giang Group Reaching Far and Wide.........................................................................40- Hafele Vietnam Looking toward Fruitful 2010 ..............................................................................42- Parkson Vietnam: A Symbol of Success and Pride........................................................................44- “We Always See Opportunity in Difficulty”......................................................................................45- Maritime Bank: Comprehensive Growth .........................................................................................58

Culture- Family Reunions for Tet .........................................................................................................................66- Popular Cultural Festivals of Vietnam ...............................................................................................68

Although the traditional Lunar New Year, Tet, is get-ting nearer, prices of consumer goods are not volatileas predicted by experts. Many sales promotion pro-grammes launched by companies and supermarketshas helped curb price hike. Fastest-growing prices arestill seen in essential consumer goods such as rice,foodstuff, confectionery and dairy. The current mar-ket context promises an easing Tet for consumers,especially wage-earners working for State organs orsmall companies.

Attending the World Economic Forum 2010 held inDavos, Switzerland from January 25 - January 31,2010, Prime Minister Nguyen Tan Dung shared expe-rience of Vietnam in dealing with global financial andeconomic crisis. He presented six pieces of experience.The first is the need to see weaknesses in monitoring,forecasting and warning the possibility of crisis and toincrease resources to perform these activities on thenational, regional and global scales. Secondly, it isnecessary to attach importance to macro-economicstability, ensure the balance of the economy and thesafety of financial and banking systems, and needproper fiscal and monetary policies operated under amarket economy in couple with to promoting the roleof State management to overcome shortcomings ofthe market. Thirdly, each country has different socio-economic conditions; so, solutions to cope with crisisand ward off economic recession must be appropriatewith practical conditions of each country. Fourthly,together with solutions to stimulating the economyand ensuring macroeconomic stability, Vietnam paysa special attention to ensuring social welfare andsecurity, supporting agriculture and rural areas.Fifthly, when sound goals and solutions are defined,the close, consistent, drastic direction and manage-ment are needed in addition to propagandising infor-mation to increase the consensus of the society, pro-moting the synergy strength of the country. And,finally, responding to the crisis requires the effort ofeach country but international cooperation is alsoneeded to gather more resources and coordinate in

DEAR READERS,

joint actions on the regional and global issues.The Vietnamese stock market is rated a place toinvest in by foreign experts. However, to makethe market transparent become an effectivefundraising channel, the Government and theState Securities Commission of Vietnam haverecently made another resolute move to forcepublic companies to operate in more transparentprinciple. To put an end to parrying of publiccompanies in registering securities depository atthe Vietnam Securities Depository (VSD) - orstrictly implement the obligation of transparencyand protection of shareholders, the StateSecurities Commission (SSC) will employ theDecree 36 to fine violating companies. Also in2010, according to new regulations, financialstatements in public companies must be auditedby independent auditing institutions and pub-lished in full text on mass media.

An important economic activity taking place onJanuary 26 is the Vietnamese Government issuedUS$1 billion of sovereignty bonds with a maturityof 10 years. Barclays, Citi and Deutsche Bank,three world-leading financial institutions, guar-anteed the issue. They believed that the issuewould draw a strong demand. At the issue, 200accounts registered to buy the notes with a totalregistered value of US$2.4 billion, 2.4 times high-er than the issue value. The bonds are transactedat nominal coupon of 6.75 percent per annumand a yield of 6.95 percent. The result is betterthan estimation as credit ratings institutions hadrelatively negative ratings on Vietnam.Importantly, Vietnamese bonds drew high-quali-ty cash from the United States (56 percent),Europe (16 percent) and Asia (28 percent).

The year 2010 began with a considerably stablemarket and many favourable conditions forVietnamese economy to develop.

Editorial Board

How do you see the role of pri-vate sector in ASEAN economicdevelopment?

The development of ASEAN pri-vate sector is essential for the region-al economic integration and cooper-ation, increasing competitiveness ofeach member state and the commu-nity as a whole, making ASEAN adynamic economic region, equallydeveloped and highly competitive.Governments of ASEAN membershighly value the role of private sectorin the regional economic develop-ment, and as a matter of fact, in thepast two decades, private sectoreconomy has contributed an impor-tant part in the fast development ofASEAN.

Recognition of private sector roleis not only confined in its participa-tion and contribution to the eco-nomic development but also in the

policy-making process. In 2003,ASEAN established ASEAN BusinessAdvisory Council (ASEAN - BAC) withthree members from each memberstate to promote business activitiesof this sector. As a result, initiativesand specific projects have been sub-mitted to annual Summit Meetingfor approval. At Summit meetings,discussions and consultations wereheld between ASEAN leaders andpolicy-makers to improve businessenvironment and policy for privatesector. In addition, business invest-ment conferences also offeredopportunities for businesses to dis-cuss directly with State leaders andseek business partners. In fact, therole of private sector is clearly mani-fested in ASEAN economic develop-ment.

With ASEAN support, how isthe development of private sec-tor in recent years?

ASEAN private sector hasincreased in size in recent years.Their participation in governmentprojects have been expanded, espe-cially in clean energy, infrastructure,training and promotion activitieswhich were in the past solely doneby big State-owned enterprises.More importantly, private sector hasnow its own voice in the policy-mak-ing process, indirectly planningvision and action for ASEAN. WithASEAN 2010 in Vietnam and thetheme “From vision to action”, pri-vate businesses will also be theavant-garde. The projects they haveimplemented in recent years have

shown the fast development of thesector.

More specifically, how willASEAN-BAC support private sec-tor in ASEAN 2010?

Under the chairman of Vietnamin ASEAN 2010, VCCI will organizeseveral important activities includingASEAN Trade and InvestmentSummit 7 (ASEAN BIS 2010), con-necting private sector with othereconomic organizations in theregion and the world, sponsoringASEAN Business Award 2010.

ASEAN-BAC will focus on issuesconcerning private sector and sub-mit to ASEAN leaders and ministersthe views and recommendationsmade at annual meetings with Stateleaders and ministers. The recom-mendations will be very importantfor the establishment of ASEANEconomic Council (AEC) in 2015 witha series of economic agreements,long-term plan and programme ofaction.

ASEAN-BAC together with busi-nesses will overcome difficulties,enhance the role of private sector inASEAN, increase cooperation amongASEAN and between ASEAN andpartners so as to increase the impor-tance of ASEAN in the world econo-my.

Most of ASEAN SMEs includingthose of Vietnam have littleknowledge about ASEAN, howcan ASEAN-BAC 2010 improvethe situation?

It is an important issue. ASEAN

COOPERATION

vietnam business forum FEB 2 - MAR 1, 20104

From Visionto Action

VCCI Vice President Doan Duy Khuong

started the integration in 1992. ASEANgovernments, Secretariat and Councilhave made great efforts but due tosome reasons, information on ASEANremains little known. I think thatgovernments and promotion organi-zations such as Chambers ofCommerce, Business Advisory Councilhave an important role in sponsoringprogrammes and conferences provid-ing correct and timely information tobusinesses.

In 2010, we will coordinate withASEAN governments to organizesome information programmes.Regarding SMEs, ASEAN-BAC mem-bers will serve as consultants. In fact,many businesses have provided infor-mation not only to enterprises in theirown countries but also those in the

region. For businesses having infor-mation but without business efficien-cy, ASEAN-BAC will organize trainingcourses to improve their capacity.

Besides information and tech-nical consulting, do you think thatcredits and suitable policy are alsoequally important?

Credit systems supporting busi-nesses are very strong in many EUmembers, US, Japan, etc. Businesseshave credit collateral for their businessactivities. Meanwhile, SMEs in ASEANmust have collateral assets. The situa-tion must be improved.

ASEAN-BAC has an idea to estab-lish a credit investment fund to besubmitted to ASEAN governments. Wewill present the project to ASEAN

Summit in Vietnam so that SMEs canhave access to ASEAN credit fund.

Finally, how do you see thechance of private sector in ASEANand what can Vietnamese businessbenefit from ASEAN chairman-ship?

In fact, there are many pro-grammes for ASEAN integration. Taxrates are almost zero among ASEANcountries. Customs and visits aremuch more favourable. Cooperationprogrammes increase among ASEANmembers. ASEAN have also developedcooperation with strong partners asthe US, Japan, EU, etc. Consequently,businesses can develop cooperationnot only in ASEAN framework but alsowith ASEAN partners to increase com-petitiveness and expand markets.They must make the best use of busi-ness opportunities.

ASEAN-BAC is established to servethe interests of the whole ASEAN com-munity. We will sponsor forums andcooperation opportunities so that allASEAN members can benefit fromthem. Vietnam, one of the four lessdeveloped countries in ASEAN, willcertainly benefit from preferentialtreatment by the six more advancedcountries. Though, chairmanship is arotation, Vietnamese businesses canbenefit from the infrastructure devel-oped for ASEAN as well as exchangesof information and businesses oppor-tunities with ASEAN countries.

Thank you very much!Reported by Thu Huyen

http://vibforum.vcci.com.vn 5

Happy New Year2010

“Private sector is a driving force in theeconomic development. By its efficientperformance, the sector has played animportant part in the new stage of ASEANdevelopment. The task of ASEAN businesscommunity is not only dealing with theexisting difficulties but also ready to makethe best use of opportunities to come”.

Vietnam Business Forum discussed withDr. Doan Duy Khuong, VCCI Vice-President, Chairman of ASEAN BAC on thepreparation for the chairmanship ofVietnam in 2010 to promote economicactivities of private sector and implementsuccessfully the ASEAN theme “Fromvision to action”.

Vietnamese enterprises will likely have more business opportunities withASEAN countries when the information channel improves

Stable economic recoveryFrom the bottom of the economic

recession in Quarter 1 of 2009 withGDP growth rate only of 3.1 percent,Vietnam economy has recovered fromquarter to quarter with annual growthrate of more than five percent, the low-est in the last decade and much lowerthat previous years of 8 percent.Nonetheless, Vietnam is among fewcountries in the world that maintainedplus growth rates. The economy startsrecovering and it is a stable recovery.

Realizing the built-in difficulties ofthe economy and foreseeing the tangi-ble impacts of the global recession,Vietnamese government has appliedstimulus measures from the beginningof 2009. Among them, the stimuluspackage of US$8 billion has successful-ly rescued the economy from moreserious recession, assisted businessesand kept the inflation under control.

With the impacts of the crisisremain serious in many major

economies, ODA committed by thosecountries to Vietnam in 2009 reached arecord height of over US$8 billion,US$3 million more than previous years.It shows that in spite of the world eco-nomic difficulties, sponsors continuetheir confidence in the prospect andthe determination of Vietnam toimprove investment and businessenvironment.

The economic crisis is the touchstone for all economies. Besides flexi-ble measures to minimize the impactsof the crisis, the government hasrestructured the economy and calledon enterprises to reform themselves toprepare for the development in thenext stage. The government has alsoanalyzed the strength and weakness ofthe economic groups to re-organizethe “backbone” enterprises so thatbusiness community can adapt them-selves to the new conditions anddevelop more vigorously in the post-crisis period.


PREMISES & OPIn 2009, the world

economy reached thebottom of the mostserious world econom-ic crisis since the GreatDepression in 1929-1933. Though beingstrongly affected bythe crisis, Vietnameconomy was able torecover by the end of2009 with GDP growthrate of 5.2 percent.Those are premises fornew opportunities ofhigher development inthe next stage.

Prime Minister Nguyen Tan Dung and Vietnamese State leaders visit Thailand on the occasion of 14th ASEAN Summit

A successful year of diplomaticrelations

Even when all countries includingVietnam were preoccupied with theeconomic crisis, Vietnam could workhard and made progress in diplomaticactivities.

In 2009, Vietnam has developed alldiplomatic activities with flexibility,diversity, combining all channels: Party,government and people-to-people,political, economic, cultural and over-seas Vietnamese, to maintain peace,stability and heighten the position ofVietnam in the international arena.

In political diplomacy, Vietnam hasimproved relations with all countries,especially neighbouring countries,countries in the region, major powersand other important partners, toensure deeper, more stable and lastingrelationship so as to maintain peace,stability and development.

The special relations with Laos andall-round cooperation with Cambodiahave been strengthened in all fields.Multi-faceted cooperation with othercountries in South East Asia has beenpromoted in both bilateral and inASEAN frameworks. The all-roundstrategic cooperation and partnershipwith China continues to develop withthe guideline of “16 words” and spiritof “four goods”. 2010 is the “Year ofVietnam-China Friendship” and com-memoration of 60th anniversary ofbilateral diplomatic relations. The twocountries have completed the borderdelineation and legal framework onland border with the signing of impor-tant documents: protocol on land bor-der, agreement on border manage-ment, agreement on border gates andmanagement.

Vietnam has promoted andachieved important successes inestablishing strategic partnership andall-round cooperation with major

countries and industrial countries.Vietnam and the United States havedeveloped relations of friendly part-nership and multi-faceted coopera-tion of mutual benefit. The strategicpartnership with Russian Federationdevelops with in-depth. After fiverounds of negotiation on Partnershipand Cooperation Agreement (PCA)with EU, Vietnam has achieved someprogress and promoted bilateralcooperation with each EU membercountry. Vietnam has upgraded coop-eration with Chile, African countriesand some important partners inMiddle East such as UAE, Qatar,Kuwait.

Also in 2009, Vietnam completedits role as non-permanent member ofthe United Nations Security Councilfor two years 2008-2009 successfullydealing with complicated issues andadvancing several initiatives and reso-

lutions. With high sense of responsibil-ity, Vietnam has contributed to theimplementation of the Charter anddevelopment of ASEAN Community.From January 2010, in capacity asASEAN chairmanship, Vietnam hasadvanced the theme “Towards anASEAN Community: From vision toaction”. Vietnam also assumes thechairmanship of ASEAN Inter-Parliament Assembly (AIPA) and playshost to East Asia Economic Forum.

In cultural diplomacy year 2009with diversified and efficient activities,especially Vietnam Days and VietnamWeeks organized abroad, and othercultural, political and economic activi-ties, Vietnam has improved its imagein the world. Vietnam has once morebeen elected to the Council ofUNESCO and UNESCO has recognizedas international heritages Chamisland, Ca Mau cape, wooden printplates of Nguyen dynasty, folk songsQuan Ho and Ca Tru.

Opportunities and challengesRecovering early when the world

economy remains in difficulties,Vietnam economy can have the chancefor a take-off. The economic crisis isanother test for the tradition ofVietnam. In 2009, when outsideresources were at low ebb, the contri-bution of the private sector increasedto 35 percent of social investment, pre-venting the recession and retrievingthe economy. The confidence of thepeople in the government policy andthe contribution of business communi-ty in critical time are the biggestawards of the people to the Party andgovernment.

However, in 2009, there remain sev-eral problems and challenges requiringgreater efforts on the part of the gov-ernment. FDI decreased to US$21.5 bil-lion compared to US$60.3 billion in2008. Worse still, instead of investing in

industry and high technology, nearly80 percent of the investments flowedto less added-value industries such asreal estate, hotels, and restaurants.Government debt is nearing safetylimit of 40 percent of GDP. Grant aidsand soft loans are decreasing while lessfavourable loans continue to increaseand will be replaced by commercialloans as Vietnam is approaching thelevel of middle income state.

In 2010 and the following years,Vietnam will face new problems ofdevelopment such as growth qualityand competitiveness of the economy,harmonizing international integrationwith socio-economic stability, protect-ing national sovereignty from tradi-tional challenges as well as non-tradi-tional challenges such as high seawater level caused by climate change.Evidently, new premises and opportu-nities demand much greater efforts. n

VBF


Happy New Year2010

PPORTUNITIES

? MAI NGOC

Number of newly established busi-nesses is still on the rise

Amid difficulties caused by theglobal financial and economic crisis onthe Vietnamese economy, theVietnamese business community suf-fered substantial impacts. Exportsslumped as demand shrank in import-ing markets and governments of manycountries adopted trade remedy poli-cies to protect their domestic produc-tion while foreign low-priced productsincreased their presence on the localmarket. Prices of inputs like electricity,gas, oil and coal were volatile, the stockmarket plunged steeply and real estatemarket was freezing. Many foreigninvestment funds withdrew their capi-tal from the Vietnamese market. As aresult, companies had to cut jobs andscale down production and many,especially SMEs, did not have enough

work or fell into stagnation. Until now,there is no accurate number of col-lapsed companies in the wake of eco-nomic crisis, but according to a reportsent to the National Assembly in lateJune 2009 by the Ministry of Planningand Investment, the country had about2,500 companies dissolved (an averageof 450 companies collapsed eachmonth). In addition to economic lossesincurred by the business community issocial subsequence caused by econom-ic crisis like layoffs that lead to anincrease of poorer people and tax rev-enue reduction budget revenue thatwill affect public investment.

However, the macroeconomic pic-ture is not completely dark. TheVietnamese economy was directlyaffected by global world but it onlydeclined, not falling into recession asother countries, and still maintainedpositive growth before surging in thelast months of the year. But, important-ly, in the context of economic reces-sion, the business community neverretreated but grew up. In particular, in2009, over 83,000 new enterprises wereset up, representing a rise of 28.3 per-cent over 2008. And, with this growth,Vietnam is expected to have 540,000companies by 2010, over 8 percenthigher than the initial target of 500,000.Most enterprises have passed the mostdifficult period and started scaling upproduction. Labour shortage has hap-pened to many industrial parks.

To obtain this result, the businesscommunity, apart from its own efforts,activeness and creativeness, hasreceived enormous supports from theGovernment through the stimuluspackage worth up to US$8 billion,together with a number of macro poli-cies. In addition, the economic crisisnot only brought about adverse effectsbut also good opportunities for manycompanies. Many took advantage of

VCCI


A business leadercan usually becompared to a sol-dier. When the eco-nomic downturnworsened in thepast year, thesebusiness leadershave successfullyled their ships ofbusiness out of thedevastating stormto enter the oceanof integration andsuccess.

No Giving Way


Happy New Year2010

to Difficultiesexcess production in other nations topurchase cheap materials, technolo-gies and equipment. At the same time,the economic difficulty was also achance for enterprises to restructuretheir operating apparatus, improve thequality of human resources and mapout suitable strategies for the new con-dition.

Together with businesses

The Vietnam Chamber ofCommerce and Industry (VCCI) - anational organisation representing andsupporting the business community -always doubles its effort to help thebusiness community overcome difficul-ties. Last year, VCCI actively participat-ed in lawmaking process, being a mem-ber in seven law-drafting committeesand a member in legal document edit-ing committees and sending 45 directcomments to lawmakers. In addition,VCCI held 230 conferences and semi-nars to seek comments on policy andlegislation from nearly 40,000 attend-ing businesses, (a rise of 13 percent inmeetings and 33.3 percent in atten-dance in comparison with 2008).

VCCI continued joining efforts toimprove the business environment.The survey for provincial competitive-ness index (PCI) continues to attractthe great interest of the business com-munity, government agencies, localauthorities and the society. The PCI isbuilt on 10,000 surveys with 44,000businesses under diverse forms andinsight study in 360 enterprises tobuild database. VCCI basically com-pleted the attention-grabbing PCI2009 Report.

In addition, VCCI actively partici-pated in public administration reform,especially the reform of administrativeprocedures; continued to maintain thedialogue mechanism between busi-

nesses and government agencies, forexample, coordinating with theMinistry of Finance, the GeneralDepartment of Taxation, the GeneralDepartment of Customs to open con-ferences and dialogues with enterpris-es on tax and customs procedurereforms, working with the State Bankof Vietnam to host the dialogue con-ference with businesses on removingobstacles in the bank-business rela-tionship after the governmentlaunched policies to support interestrates.

In 2009, VCCI received 310 visitingdelegations with 12,360 enterprises(up 3 percent in events and 19 percentin attendance compared with 2008),and organised 95 delegations wit5,200 Vietnamese to visit foreignnations (up 22 percent in events and8.3 percent in attendance from 2008)to attend international conferences,market surveys and trade fairs, includ-ing the large-scale accompanying toState and Party leaders, for example,businesses convoying the StatePresident attend to the 64th UNGeneral Assembly and to visit Cuba,Chile, Spain, Italy and Slovakia; delega-tions accompanying the PrimeMinister to visit United Arab Emirates,Qatar, Kuwait, China, South Korea,Kazakhstan, Denmark and Hungary.Many business contracts worth billionsof US dollars were signed during andafter these official visits.

Besides, VCCI held nearly 500 semi-nars, conferences, discussions, businessmatch meetings for more than 75,000Vietnamese and international enterpris-es (up 16.3 percent in events and 56percent in attendance from 2008) tosupport enterprises to approach mar-ket, find partners and access businessand investment opportunities; hosted11 exhibitions in the country with 2,600attending enterprises.

Specifically, in a response to thegovernment’s appeal for business sup-port, VCCI has stopped collecting feesfor C/O from March 1, 2009 but thequality of C/O certification is alwaysimproving and more professional. In2009, VCCI issued 498,300 certificatesof origin (C/O) for exported goods,down 9 percent from 2008 - a result ofdeclining export or some enterprisesapplied for certificates from theMinistry of Industry and Trade).

VCCI said Vietnamese businessforums received strong supports fromgovernment agencies and enterprisesbecause of its high effect. Besides,forums were also incorporated withsymposiums on business developmentand market penetration guide.Business forums helped enterprises tohave a direct channel to exchangeinformation with foreign business com-munities. This form of communicationis rated an effective general investmentand trade promotion model.

However, despite many efforts,VCCI still had many shortcomings in itsactivities. For instance, it lacks nation-al-scaled programmes or projects tosupport businesses to developresources, restructure and deepeninternational economic integration. Itsactivities were improved but the quali-ty was not always satisfied.

On the other hand, limitedresources and insufficient infrastruc-ture caused more difficulties for VCCIas workload increased steadily, espe-cially after implementing the free C/Opolicy. Many programmes and projectsdepend on assured financial resources,thus not creating the activeness inimplanting these programmes andprojects. The network of collaboratorsis also thin and unprofessional while itis not easy to find capable and experi-enced experts.

(continued on P.25)

Why does VCCI developand implement this project?

By the imitative of VCCI,Wales Business Forum – a VCCIpartner in the past 10 years forsocial responsibility and anti-corruption, together with inter-national transparency organiza-tion, embassies of Sweden andUK in Vietnam, GovernmentInspectorate and related authori-ties, VCCI and others organizedtwo seminars in 2008 to get theviews of businesses on trans-parency and integrity in businessrelations. Based on those views,VCCI develops a three-year pro-gramme “Launch of the integrityand transparency in business ini-tiative for Vietnam – ITBI” toincrease the participation andinfluence of businesses in thefight against corruption – a pri-ority in the government agenda.

As anti-corruption is a globalfight, VCCI together with inter-national organizations is tryingto enhance the role of businesscommunity to say No to corrup-tion. It is meaningful not only inVietnam but also in the regionand the world over. Corruptioncauses great losses to the econo-my and the people, especiallythe poor. The fight against cor-ruption can be a long journeybut it must begin now before it istoo late.

What is the role of interna-tional organizations in theproject?

It is a joint initiative ofVietnam and international orga-

nizations but VCCI is the co-coor-dinator. Foreign countries andorganizations play an importantrole in consulting and providingtechnical assistance such asresearch, training and improvingknowledge and internationalcooperation on anti-corruption

Participants in the project aremainly businesses with focus ontheir problems in the fightagainst corruption, sectors rid-den with corruption, so as towarn and recommend business-es to avoid immoral or corrup-tion practices. In later stage, theproject will conduct a generalstudy and priorities in the fightagainst corruption.

Another important role thatinternational organizations canplay is to upgrade the knowl-edge of businesses. Most ofVietnamese businesses are smalland medium sized enterprises(SMEs) and have little knowledgeon anti-corruption. Therefore,the project will organize series ofconferences and seminars on dif-ferent subjects of corruption,mobilizing various socialresources, especially massmedia, to update informationand increase public education onthe fight against corruption.

The project will also highlightthe influence of businesses insaying No to corruption, increas-ing awareness of their importantrole. Then, the project willupgrade their capacity in thefight against corruption in theirown enterprises. VCCI is respon-sible for the training, an impor-

VCCI


Businesses Say

On the occasion of the“Launch of the integrity andtransparency in business ini-tiative for Vietnam” (ITBI),Vietnam Business Foruminterviewed Mr NguyenQuang Vinh, DeputyDirector, Office ofBusinesses for SustainableDevelopment, VCCI, theorganizer of the project.

tant job. International practice andknowledge have been processed tobe suitable to the conditions inVietnam. The project will coordinat-ed with concerned authorities toorganize training courses forVietnamese SMEs to increase theircapacity in the fight against corrup-tion.

VCCI has also attained the coop-eration of big companies and trans-national corporations to take part inthe training, sharing their experi-ences with Vietnamese SMEs.

What are the conditions andbenefits of businesses to partici-pate in the project?

There is no conditions whateverfor businesses to participate in theproject. They can be from any eco-nomic sector, without discrimina-tion on ownership, size and can par-ticipate directly or indirectlythrough their business associations.

As the project is the one of itskind in Vietnam, businesses or busi-ness associations participating inthe project will be recognized asexemplary members with goodimage in the eyes of both partnersand the society. Their competitive-ness, reputation and market sharewill be improved accordingly.Nowadays, clean business, cleangrowth have been highly appreciat-ed. Saying “No” to corruption, busi-nesses will be regarded as cleanbusiness with high sense of morali-ty, meeting the expectation of part-ners and consumers.

How can VCCI assist business-es to participate in the project?

VCCI is a business-oriented orga-nization, protecting the interests ofbusinesses. Participating in the pro-ject, businesses will get full assis-tance free of charge from VCCI.Besides this project, VCCI has alsoimplemented series of projectsassisting businesses such asCorporate Social Responsibility(CSR). Annually, VCCI organizedCSR awards. This year, the awardswill honour businesses on labourand environment. Next year, it canbe on anti-corruption. Those activi-ties will also encourage businessesto participate in the sustainablebusiness development.

As it is a three-year project,do you envisage a long-termplan for anti-corruption?

While developing this project(Phase 1 in 2010-2012), VCCI alsoenvisages the sustainability of theproject. To this end, concerned par-ties and Vietnamese businessesmust be fully aware of the benefit ofthe project. Thereby, VCCI canmobilize human and financialresources for businesses withoutdepending too much on assistancefrom international organizations orother sources. In the coming years,VCCI will mobilize assistance fromVietnamese companies and multi-national companies operating inVietnam to ensure sustainability ofthe project. The project will alsohelp VCCI implement the nationalstrategy launched by the govern-ment against corruption until 2020.

Thank you very much!Reported by Quynh Chi


Happy New Year2010

No to Corruption

Corruption isharmful tonational pres-tige, economicenvironment,politics, societyand humanbeings.Therefore,national strate-gy against cor-ruption until2020 has beenlaunched byVietnamesegovernment.

vietnam business forum JAN 26- FEB 1, 201012

L I N K I N G Vietnamese Women

There are presently over 400,000 enter-prises, 30 percent of which are man-aged by business women. This showsthat the number of female entrepre-neurs is on the rise and they havemade great contribution to the nation-al socio-economic development

Vietnam Women Entrepreneurs Council (VCCI) hosts a New Year programme to honour Vietnamese businesswomen

? MY CHAU

Imprint of businesswomen

At the recent meeting with an aim tolink businesswomen in the commoncause of the national socioeconomicdevelopment organised by VietnamChamber of Commerce and Industry(VCCI), Mr Pham Gia Tuc, Vice Presidentof VCCI, emphasised: Regardless offields women get involved, they canwork out well with their capacity.Especially in production and businessaspect, many brilliantly show off theircharacters of economy, diligence, keen-ness, intelligence and creativity to makemore resounding success, making veryimportant contributions to the nationalsocioeconomic development.

According to the General StatisticsOffice (GSO), in 2009, Vietnam’s econom-ic growth reached 5.32 percent in 2009,higher than the initial target of 5 percent.The Vietnamese economy has powerful-ly lived through the most difficult period.Especially, according to a study conduct-ed by VCCI, about 91 percent of busi-nesses are still stably operating while 51percent of large-scaled enterprises con-tinue to expand investment. Mostwomen-led businesses have small andmedium scales but the cleverness, initia-tive and creativity of business ownersenabled them to overcome economicdifficulties in 2009 to reassert their mar-ket positions. In the common success ofeffective stimulus policies launched bythe Government, the dynamic andresilience of the business community,especially businesswomen, are impor-tant factors to bring Vietnam out of the“bottom” and gain stable growth.

According to economic experts,although inflation in 2009 was success-fully capped at 7 percent or lower, thereturn of inflation may occur in 2010. Inaddition, limitations of extensive devel-opment and instable macroeconomicbalance are brake on the developmentof Vietnamese economy this year. MrPham Gia Tuc recommendedVietnamese businesses in general andfemale entrepreneurs in particularshould take advantage of every opportu-nity to overcome the challenges; effec-tively apply stimulus packages, support-

ing policies and preferences of theGovernment to promote production andbusiness activities, join hands with otherpartners to unlock national advantagesto make more success. Additionally,female entrepreneurs also need toenhance the positive sense of communi-ty by fulfilling obligations to the StateBudget, taking care of workers, activelyparticipating and responding socialdevelopment and charitable activities.

The meeting is a place for femaleentrepreneurs to share information andpropose their solutions to related prob-lems. Ms Nguyen Thanh Ha, DeputyDirector for Thu Duc Agricultural ProductManagement and Trading Co., Ltd said:VCCI, or more exactly its Vietnam WomenEntrepreneurs Council need to strength-en cooperation, sympathy and support,create conditions for the businesswomencommunity to have more chance toexchange and share experience, not onlyin production and business activities butalso in all aspects of social and familylives. Then, female entrepreneurs willgradually overcome inferior complex,incompleteness to be more confident topromote their own abilities.

Toward National Week onVietnamese women

Also at the meeting, Ms Tran ThiThuy, Chairwoman of the VietnamWomen Entrepreneurs Council, intro-duced the National Week onVietnamese Women 2010 from March 1to 8 held by the Vietnam Chamber ofCommerce and Industry (VCCI), theCentral Vietnam Women's Union andother organs at central and local levels.This is a national-scaled event inresponse to major national celebrationslike the 100th anniversary ofInternational Women's Day (March 8),the 1970th anniversary of Two Sistersuprising and the 1,000th foundinganniversary of Thang Long - Hanoi. Withthat meaning, this is the chance for con-solidating the struggling tradition ofworking women in the world andreviewing the glorious history page ofthe Vietnamese women. The week isalso an occasion to honour outstandingwomen, politicians, female scientists,female entrepreneurs and farmers

amongst others who have actively con-tributed to the socioeconomic develop-ment, to the national industrialisationand modernisation and to the interna-tional economic integration of thecountry. The National Week onVietnamese Women will createfavourable conditions for business-women to meet, exchange, improveknowledge, establish cooperation andbusiness relations.

Many activities are expected to takeplace during the week, including aphoto show on Vietnamese women, abusiness forum, a fashion show; a forumfor female intellectuals, the 25th cere-mony to grant Kovalepskai Award andpresent the award for local outstandingfemale scientists. Notably, there will be aceremony to celebrate the 100thanniversary of International Women’sDay and to award the Golden RoseAward for Vietnamese businesswomenin 2009 on March 6.

This is expected to witness the partic-ipation of leaders from state, party agen-cies and ministries and 3,000 corporatemanagers inside and outside the coun-try. The annual Golden Rose Awardgranted by VCCI is not only a prestigiousand high-quality award in the countrybut also a global interest. The GoldenRose Award for outstanding Vietnamesebusinesswomen is highly appreciated bymany countries. This not only helpsstrengthen the prestige of the Awardbut also increase the calibre of awardees.

Ms Thuy affirmed that the NationalWeek on Vietnamese Women 2010 willlink Vietnamese enterprises in generaland female entrepreneurs in particularand link and gather influencing femalepersonalities to request theGovernment to deal with women’sissues in business, political and socialactivities.

The National Week on VietnameseWomen 2010 will become a goodchance for female entrepreneurs to dis-cuss and exchange opportunities andchallenges against the business com-munity in general and businesswomenin particular, and share valuably suc-cessful lessons to help enterprises andfemale entrepreneurs to ride out eco-nomic crisis and obtain sustainabledevelopment. n


Happy New Year2010

ECONOMIC SECTOR


“Continuing to Enhance Tourism,

That was said by DeputyMinister of Tourism, Sportsand Culture Tran ChienThang about the key opera-tions of the tourism, sportsand culture sector in 2010during an interview withVietnam Business Forum onthe occasion of the NewLunar Year.

What are your comments onthe achievements in 2009?

Generally, despite a bundle ofchallenges as a result of the globaleconomic downturn, the sector stillmade considerable achievements in2009. Firstly, the legal framework hasbeen built to guide the organising ofimportant events while social activi-ties were held enthusiastically. Thetourism industry started the year2009 by organizing the ASEANTourism Forum, which was consid-ered an important diplomatic eventto help the industry overcome chal-lenges and define direction to sur-vive the global economic crisis andto attract tourists. The most promi-nent event was the “VietnamImpression” campaign to servedomestic tourists.

Importantly, tight cooperationbetween sports, culture and tourismindustries made great contributionsto the tourism industry’s develop-ment in 2009. According to an unof-ficial statistics, Vietnam’s internation-al arrivals in 2009 were down.However, the industry earned rev-enues of VND70 trillion (US$3.788 bil-lion) in 2009, which was above theexpectations and made great contri-butions to the country’s GDP.

Regarding sports industry,Vietnam successfully organized thethird Asia Indoor Games and tookpart in the Olympic Beijing and worldand regional sport Olympiads, whichhelped promote Vietnam’s imageand boost development of the coun-try’s culture, sport and tourism sector.The country participated in the SEAGAMES 25 in Laos with great pride.Though the country’s male footballteam did not win the gold medal, itnarrowed the gap with the Thai team.The country gained 83 gold medals,bringing the country to the secondposition from the third in 2008.

Concerning culture, Vietnamissued the Law on Cultural Heritagein 2009, which is considered an effi-

cient tool for the combination of con-servation and development ofnational cultural heritages. Moretourism and cultural developmentplans have been mapped since earlythis year, which has proved the gov-ernment’s clear policy to make thebest use of both cultural and sportresources to boost tourism develop-ment. Clever collaboration amongthree industries has brought aboutconsiderable achievements.

There are still shortcomingsand challenges for tourism, cul-ture and sport industries. Whatshould be done to address thosedifficulties?

The greatest challenge is to boostthe cooperation among these indus-tries and take advantages of theindustries so as to help realize theirtarget. It is essential to improve ourknowledge about cultural value tohave an appropriate view on culturalheritages. Tourists deserve to beserved with the best spiritual and cul-tural value.

Secondly, tourism service is still oflow quality. Historic relics, museumsand travel companies have not yetmade attractive tour programmes;thus, it is necessary to hold tourismprofessional training courses toimprove tourism service quality toattract more tourists.

The sector has been coordinatingwith local authorities nationwide tomake typical tourism programmes forparticular regions on the basis of theirnatural and cultural resources.Cultural value preservation and pro-motion are considered the best wayto attract more tourists, thus, con-tributing more to the country’s GDP.We must say that it is very essential totrain personnel for museums, restau-rants, hotels, tourism sites and beautyspots’ management boards, includingforest management boards. Serviceand human resource quality shouldbe the first priority in 2010.

What are the plans for this year?

The sector will uphold its obtainedachievements in 2009, including theexpansion of events to mark culturaldiplomacy. Vietnam is targeting newmarkets, particularly those that fostertourism development, including mar-kets in ASEAN, the eastern part ofNorthern Asia, Australia and NewZealand. In addition, the sector will orga-nize more cultural exchanges with tradi-tional partners of Western Europe andthe Americas. The sector will also paydue attention to promotion of Vietnam’sgastronomy heritage to create goodimpressions on international friends.

In addition to promotion ofVietnam’s image, this year the sector willaccomplish the legal framework andpropagate specialized laws, includingthe Law on Movie Industry and Law onCultural Heritage as well as boost con-versation of cultural heritages. The sec-tor will make a list of national intangiblecultural heritages to work out the best

methods of preservation them.Vietnam’s Bac Ninh love duet (Quan

Ho Bac Ninh) and Tru festival songs (CaTru) have been recently recognized asworld intangible cultural heritage by theUnited Nations Educational, Scientificand Cultural Organization (UNESCO).Vietnam now has 10 special nationalintangible relics. The sector will contin-ue to make dossiers to seek UNESCO’srecognition as world cultural heritagesfor more national relics in 2010 to boostpreservation.

Vietnam will organize a lot ofspecial events this year, includingthe ceremony to mark the 1,000thanniversary of Thang Long-Hanoiand an event to mark the 50thanniversary of the tourism industry.Could you please talk aboutVietnam’s plans to attract moretourists during these special events?

Programmes to mark the 1,000thanniversary of Thang Long-Hanoi will

not only be organized in Hanoi but alsoin other cities and provinces nationwide.Hanoi is speeding up preparations forthe national tourism year in 2010 to pro-mote tourism in the capital city. Hanoi’stourism sector will add more accommo-dations and make typical tourism prod-ucts with due attention given to craft vil-lages to serve tourists. Hanoi is home tomassive craft villages, including Ngu Xabronze casting, Dinh Cong silver, andBat Trang pottery in the inner city; VanPhuc silk, Phu Vinh bamboo rattan,Thanh Tri steamed rolled rice pancakeand Phu Do rice noodle. The sector willalso continue to enhance the compe-tence of servers and upgrade accommo-dations in Hanoi to ensure a safe, quali-fied and friendly tourism environmentfor tourists.

Thank you very much!Reported by Thu Huyen


Sports & Culture Activities”Happy New Year

2010

Cow racing - Vietnamese long lasting traditional festival

What effect has theopening brought in?

In 2009, the Vietnameseretail market was officiallyopened in line with the WTOentry commitments and alleconomic sectors in the coun-try and abroad can distributegoods in the territory ofVietnam without any barrier. Anumber of giant corporationsaround the world have enteredthe Vietnam market.

Though affected by eco-nomic recession, the achieve-ments of the retail sector werevery impressive. The retailingrevenue of goods and servicesapproximated VND1,200 tril-lion (US$66.66 billion), up 18.6percent over 2008.

The retail industry togetherwith distribution sector alsocontributes about 14 percentto the country’s GDP and cre-ates more than five millionjobs. The Vietnamese market iscontinuously ranked high onGlobal Retail DevelopmentIndex (GRDI).

What can be expectedfrom the Vietnam retailmarket in 2010?

In 2010, many leading inter-national retailers will enter theVietnamese market becausethere is still much room. Withthese positive changes, retailsales in Vietnam this year willreach about VND975 trillion,up 20.5 percent over last year.

Recently, the modern retailhas made up nearly 20 percentbut, stepping into 2010,Vietnam will surely witness the

expansion of modern retailchannels.

The investment in the dis-tribution service sector isgrowing as high as 20 percenta year and consumers accountfor more than 70 percent of thepopulation. The Vietnameseretail market has many advan-tages and potential to grow inthe years to come.

What do you think aboutthe Vietnam retail markettrend?

In the coming time, moderndistribution channels will domi-nate in Vietnam, the marketshare of supermarkets isincreasingly greater than tradi-tional markets and agents. Inaddition, thanks to science,technology and e-commerce,consumers have begun to usenovel retailing methods such asonline shopping or phone shop-ping. The volume of goods soldwill be therefore larger thansales at traditional fixed points.

What do you think aboutthe competitiveness ofVietnamese retailers?

It is true that domesticretailers are holding lessadvantage than foreign rivalsbut it is not the reason for theirweaker competitiveness. Forinstance, Hapro, Coopmart andFivimart are not inferior to anyof the international companiesin terms of distribution sys-tems and earnings.

I see that Vietnamese com-panies are not passive andthey are gradually creating

ECONOMIC SECTOR


VIETNAM RETAIL MARKET TO PREVAIL SOON

One year after opening to for-eign companies, theVietnamese retail market hasstruggled to escape the globaleconomic crisis with impres-sive progresses. The VietnamBusiness Forum Magazine hasan exclusive interview with MrNguyen Thanh Bien, DeputyMinister of Industry and Trade,on this issue.

chain links to reduce costs andproduct price as well as addresstheir weaknesses.

The potential growth of 20 per-cent must be powered up by theconstruction of infrastructure.However, most Vietnamese compa-nies have small and medium scalesand their weak financial capacitiescannot compete with foreign firms.However, domestic retailers arestruggling to "refresh" themselvesand they are focusing their invest-ments on such areas as logistics,storage facilities, specialised trucks,personnel training and informationtechnology.

The opening of retail market

requires an attractive businessenvironment. What is the solu-tion to this matter?

The presence and successfuloperations of several foreign retail-ers and distributors in theVietnamese market have also creat-ed an attractive business environ-ment and encourage Vietnameseenterprises to develop in a fair busi-ness environment. Currently, theMinistry of Industry and Trade isbuilding a “master plan for com-mercial development in Vietnam inthe 2009-2015 period, with vision to2025,” aiming to develop infrastruc-ture system reasonably in 2009-2015 period to form a more conve-nient, modern, civilised business

environment, develop the marketand plan the retail market. TheMinistry also set forth goals for theperiod from 2010 to 2015 in whichthe retail sales will increase morethan 18 percent per annum andpeak 20 percent in the followingyears. In addition, the Ministry ofIndustry and Trade continued toimplement domestic market devel-opment programmes to supportVietnamese enterprises to do busi-ness in the domestic market, stepup the “Buy Vietnamese” campaignand bring goods to mountainousand rural areas.

Thank you very much!Reported by Huong Giang


Happy New Year2010

Incomplete publicadministration reform

MR ALAIN CANYCHAIRMAN OF EUROPEAN CHAMBER OFCOMMERCE IN VIETNAM (EUROCHAM)

For many foreign companies, thecomplexity of administrative proce-dures and the sometimes uncoordi-nated and inconsistent implementa-tion of laws and regulations betweendifferent authorities can present aserious hindrance to running a suc-cessful business in Vietnam.EuroCham, therefore, strongly wel-comes the Advisory Council forAdministrative Procedure Reform(ACAPR) initiative to identify a list ofadministrative procedures that arecausing difficulties and obstacles todo business in Vietnam (Project 30),which is currently being carried outcomprehensively at all levels, engag-ing all state administrative agencies,citizens and businesses.

However, there is strong feedbackfrom not only our members but alsofrom the business community that theapproval process for setting up busi-ness in Vietnam still takes pains. Theobligation for the investor toapproach in sequence a number ofgovernment agencies renders theprocess unduly time consuming. Wetherefore recommend that Vietnammove to a “one-stop shop” approval.It would then be the responsibility ofthe relevant ministry to coordinatewith other government bodies wherenecessary. In most developing coun-tries this mechanism has provedextremely useful and effective.

Customs issues have recently trou-bled many European companies, likefor example long processing times at

customs due to lacking pre-arrivalclearance, equal treatment of allgoods regardless of their customsvalue, uneven import duties on disas-sembled parts of a product as com-pared to the import of the finishedproduct, or the problem of damagedgoods in customs procedures.EuroCham welcomes the opennessand the willingness of the VietnameseGovernment in general and theGeneral Department of Customs inparticular to enter into a constructivedialogue and solicit feedback on alladministrative procedures and overallcustoms issues that the foreign busi-nesses in Vietnam encounter.Improving customs laws and regula-tions does not require huge capitalinvestments but can improve drasti-cally the investment climate inVietnam.

More transparencyneeded in infrastruc-ture construction

MR TOMAS SIEBERTPRESIDENT OF AMERICAN CHAMBER OFCOMMERCE IN VIETNAM (AMCHAM)

The lack of high-quality physicalinfrastructure, especially roads/ports,is a continuing and growing concern.Many prospective U.S. investors pointto infrastructure deficiencies andinadequate logistics as a major nega-tive factor. And AmCham has men-tioned this critical issue in every VBFmeeting since at least May 2006.Infrastructure constraints in Vietnamthreaten current and future FDI forexport and manufacturing. Privatesector participation in infrastructuredevelopment, finance, and manage-ment is needed urgently, especially in

ECONOMIC SECTOR


TOWARD SUSTAINABLE Business Environment

The business environmentin Vietnam is always thetop concern of foreigninvestors. Although thenation has greatlyimproved infrastructure,administrative reform,human resource develop-ment, there seems to bestill many shortcomings inthe Vietnamese businessenvironment. To build asustainable business envi-ronment, Vietnam hasmany things to do.Vietnam Business Forumexcerpted the viewpointsof several foreign businessassociations on this matter.

electric power generation and deep-water seaports.

Today, there are still deficienciesand delays in development of key infra-structure, especially inter-provincialroads, bridges, including approachroads, electric power, strategicallylocated seaports and their related land-side infrastructure and intra-city publictransportation such as light rail.

The World Bank, the AsianDevelopment Bank, and Japan’sInternational Cooperation Agency(JICA) and Bank for InternationalCooperation (JBIC) have contributedsubstantial loans to develop transportinfrastructure. However, the effectiveuse of these funds has been con-strained by inefficiencies and corrup-tion. Foreign business associations arerepresentatives not only of the FDIcompanies here in Vietnam, but also, ina way, representatives of the citizensand taxpayers of the U.S., Europe,Japan, Australia and other countries,whose taxes provide the bulk of theseODA funds, we encourage the donorsto be more effective in managing theirfiduciary responsibilities.

Major reform in educa-tion system

MR PAUL FAIRHEADCHAIRMAN OF AUSTRALIAN CHAMBER OF

COMMERCE IN VIETNAM (AUSCHAM)

A recent paper published by theAsh Institute of the Harvard KennedySchool found that over 50 percent ofVietnamese graduates are unable tofind employment in their chosen fieldof study, evidence of the disconnectbetween the existing education systemand the needs of the business commu-nity. Our members often note thatnewly recruited staff often needretraining as they lack the work-readyskills required to succeed in a modernbusiness environment. Accordingly,challenges in attracting and retainingskilled workers remain at the forefrontof our members’ concerns.

In order to address the humanresource challenges, we believe thatthe Government will need to imple-ment major reform in the educationsector. Proper accreditation of coursesand institutions supported by interna-tionally recognised standards is funda-mental to establishing a modern edu-cation system. Such initiatives shouldbe complemented by the developmentof leadership and managerial expertiseat the institutional level. Quality assur-ance programs and modern informa-tion systems are also needed to facili-tate objective measurement of qualityand performance and the implementa-

tion of necessary improvements. Weencourage the Government to workwith institutions (particularly experi-enced foreign education and vocation-al training institutions) to put in placethe frameworks necessary to improveand sustain quality and performancethroughout the Vietnam education sys-tem.

Capacity to settle dis-putes needs improving

MR ALEXANDRE G. LEGENDREVICE PRESIDENT OF CANADIAN CHAMBER OFCOMMERCE IN VIETNAM (CANCHAM)

Our members have expressed con-cerns about the lack of efficient solu-tions to resolve business disputes inVietnam. We ask the Ministry of Justiceand the Supreme Court of Vietnam toallocate more resources for the effi-cient resolution of commercial litiga-tion cases. More specifically, the courtsystem needs to increase its capacity tohear cases and render decisions includ-ing emergency and interim measuresthat can be enforced in an efficient andcost effective manner. There is anurgent and immediate need toimprove the ability, qualifications andcompetence of judges in specializedcourts including the economic courtsunder the jurisdiction of the provincialPeople’s Court.

Foreign direct investment is criticalto economic development, especially inthe wake of the global financial crisis.We believe that a robust ForeignInvestment Promotion and ProtectionAgreement (FIPA) between Canada andVietnam would send a positive signal toinvestors about the commitment ofboth governments to create the win-ning conditions for foreign directinvestments through the establishmentof a framework of legally binding rightsand obligations. Cancham continues tofollow the FIPA negotiations with greatinterest and Cancham is confident thatboth governments will be able toresolve outstanding issues and con-clude the FIPA as soon as possible. n

Quynh Chi


Happy New Year2010

? HUONG LY

Commends for Vietnam

Maintaining a relatively goodgrowth in the context of the devas-tating global economic crisis is clear-ly the most impressive achievementof the Vietnamese government ineconomic management in 2009.World-leading institutions like theWorld Bank (WB), the AsianDevelopment Bank (ADB), theInternational Monetary Fund (IMF)and the Hong Kong ShanghaiBanking Corp (HSBC) appreciatedthe rapid growth of the Vietnameseeconomy in the coming time in theirlatest reports. The World Bankappraised this achievement sayingVietnam had resisted the crisis con-siderably well. Meanwhile, IMFannounced that Vietnam will surelyoutdo others in the recovery period.

Vietnam reported a GDP growthof 5.32 percent in 2009, a relativelyhigh rate on the globe. The totalinvestment of the society reachedVND704 trillion (US$39 billion) in theyear, up 15.3 percent year on year.The country has asserted its attrac-tiveness to foreign capital flows,with a record of over US$8 billion ofofficial development assistance(ODA) capital pledged for 2010 and adisbursement of US$3.6 billion.

Mr Tai Hui, Head of EconomicResearch at Standard CharteredBank in Southeast Asia, said eco-nomic stimulus packages launchedby the Vietnamese governmenthave played an important role inspurring growth.

Economic experts also believe ina brighter future of the Vietnameseeconomy in 2010. In mid-January,newswire Bloomberg ran an article,

citing that the Vietnamese economyrecorded the highest growth in thefourth quarter of 2009 and predictedthat the growth of 7 percent in 2010is completely within reach. HSBCforecast that Vietnam’s GDP growthwill reach 6.8 percent in 2010 whileIMF anticipated a growth rate of 6percent. Most forecasts are higherthan the government’s target of 6.5percent.

Mr Kevin Snowball, chief execu-tive of PXP Vietnam AssetManagement, analysed: “Vietnamhas a population of 86 million peo-ple, an average growth of 7.3 per-cent and per capita GDP of overUS$1,000. Vietnam’s GDP in 2009,although lower than the previousyear, reflects the rapid recovery ofthis nation.”

Prudence

Mr Kevin Snowball also warnedthat the Vietnamese economicgrowth may be too hot and too fast,leading to the return of inflation in2010.

With growth heavily dependingon export and foreign investment,Vietnam will be considerably affect-ed by declining export revenues andnarrowing foreign investment. In2009, Vietnam’s export turnover slid11.4 percent from a year ago.Foreign investment capital in thefirst 10 months only approximated25 percent over the same period of ayear earlier.

Excessive pressure on VND:Rising trade deficit in decades hascaused a perpetual pressure onVietnamese dong - the domestic cur-rency. Vietnam had to devaluate itscurrency by 5.4 percent in lateNovember 2009. The country suf-

ECONOMIC SECTOR


VIETNAM ECONOMY 2010A Positive Look

The Government ofVietnam has provenits quick response tothe global economiccrisis to world-lead-ing economicresearch institutionsand credit ratingsinstitutions.According toexperts, Vietnam isthe unique ASEANcountry to keep thepositive growth inall four quarters of2009. However, thecountry also needsto be wary of eco-nomic risks.

fered inflationary pressures throughout2009 because of fast credit growth andsoaring raw material prices. The primerate rise of one percentage point, effec-tive from December 2009, is a rightstep but the pressure remains.

The State Bank of Vietnam (SBV) hassearched for measures to put the brakeon the growth momentum by askingbanks to cap credit growth at 30 per-cent in 2009 but the actual growthmounted to almost 40 percent. Hencethe government of Vietnam had torevise the credit growth target for2010. HSBC forecast Vietnam’s con-sumer price index may rise 8 percentand 6.7 percent in 2010 and 2011,respectively. Also according to HSBC,the benchmark interest rate of Vietnamwill top Asia at 12 percent within thisyear.

To curtail high inflation threat inlate November, SBV, or the centralbank, had to increase the prime rate

and require commercial banks to limitlending to nonproduction activities. Asa result, credit channels for stock andproperty have been narrowed gravely.

Repayment of national debt isincreasingly underrated: The country’scredit ratings are poorer and poorer.Vietnam now gets a credit rating of Ba3from Moody’s and BB from Standard &Poor’s. Currently, the national debt ofVietnam lowered the rating from "sta-ble" to "negative". A recent reportreleased by Nomura also recommend-ed that Vietnam may face anotherdowngrade of credit ratings. Withlower credit rate, fundraising from sov-ereign bond issues will be more diffi-cult.

Low capital efficiency: DeutscheBank said in a study that the incremen-tal capital output ratio (ICOR) worsenedrecently. Vietnam’s ICOR is much high-er than that of China or India. Low effi-ciency of capital use means higher cost

price and weaker competitiveness ofgoods. This is detrimental to an export-based economy like Vietnam.

Foreign finance is not best used:Due to the pressure on keeping the oldrecord of foreign capital attraction,Vietnam has to accept allowing FDI tobe injected into "bubble" fields like realestate and tourism instead of technolo-gy, engineering, infrastructure or edu-cation, which will help improve eco-nomic productivity in the longer term.In 2008, the amount of FDI capitalinjected into the real estate sectoraccounted for 36.8 percent and the fig-ure was 30 percent (or US$5.67 billionout of US$19 billion in total) in the first10 months of 2009. If FDI capital regis-tered for tourism was counted, the realestate and tourism sectors made up 76percent of the total FDI into Vietnam inthe first 10 months of 2009. n


Happy New Year2010

ECONOMIC SECTOR


INDUSTRY Major Contribution from

Vinacomin is trying to provide enough coal andmineral for power generation and for export ? HUONG LY

Major contributors to industrialproduction

In the first half of last year, the glob-al economic crisis dragged theVietnamese industry. The industrialproduction value increased only 2.7percent in the first quarter. However,the largest economies in the world

started recovering from the secondquarter and the VietnameseGovernment adopted drastic mea-sures; the industry of Vietnam revi-talised and grew 7.5 percent in thewhole year. The industrial valuereached 33.5 percent of GDP. Althoughthe industrial production growth waslower than in 2008, the industrial sec-tor still completed the target and madesignificant contribution to the nationaleconomic development.

According to Mr Bui Xuan Khu,Deputy Minister of Industry and Trade,such State-owned groups like VietnamNational Oil and Gas Group(PetroVietnam), Electricity of Vietnam(EVN) and Vietnam National Coal -Mineral Industries Group (Vinacomin)contributed many projects to the indus-try in 2009. Dung Quat oil refinery wasput into operation in 2009 and Dinh VuDAP fertiliser plant was inaugurated inthe fourth quarter of 2009 and has oper-ated at full capacity. Several underwayprojects are being carried out at expectedprogress. For instance, the 4,000 MWNinh Thuan nuclear power plant is pre-pared to be built in 2015; Son Lahydropower plant has completed the firstturbine; and Lai Chau hydropower plantis expected to be kicked off this year.Several smaller power plants like Ca Mauand Nhon Trach have been put into oper-ation. In 2009, thanks to domestic theconsumption stimulus, investments forconstruction of cement, coal and steelplants were also attached much impor-tance.

Major target in 2010

In 2010, the industrial productionvalue is expected to climb 12 percentfrom 2009 and the added value of theentire sector is hoped to rise 5.7 percent.Deputy Minister of Industry and Trade BuiXuan Khu said his ministry will focus oninstructing major State-owned groupsand corporations to boost production,business and export of highly valued,competitive projects to reach all targetsset for the year.

Mr Khu admitted that in 2010 theindustry and trade sector had not man-aged to resolve all shortcomings like car-

rying out several bauxite projects,increasing power price and regulatingelectricity supply to feed the demand ofthe national economy.

As regards the power price, Mr Khusaid the ministry had proposed theGovernment to raise power price by atmost 4.91 percent (or to VND1,019 perkWh) from March 1 after consulting relat-ed ministries and sectors.

This hike is the lowest amongst threeproposed plans as it is believed to causeleast impacts on production and liveli-hood of the people as the economy hasjust recovered from a terrible crisis. Withsuch a electricity price, the coal sellingprice may be added by 15 percentaccordingly.

Mr Tran Xuan Hoa, General Director ofVietnam National Coal - MineralIndustries Group (Vinacomin), promisedthat Vinacomin will closely cooperatewith EVN to introduce an acceptable sell-ing price for power generation.Vinacomin will also change its productionand business plans, intensify control overtrading and bidding activities to ensureenough of coal and mineral for export.

EVN General Director Pham Le Thanhpledged that EVN is hurryingly seekingsupplementary electricity sources for thenational grid to put an end to powershortage, especially for production.”

A representative from the State-owned Vietnam National Oil and GasGroup (PetroVietnam) said his group isspeeding up construction of many pro-jects, including many to be completedwithin this year, including Binh Son refin-ery and PetroVietnam Vung Tau Hotel.Many power projects will be quickened tostart operations as soon as possible. n


Happy New Year2010

Economic Groups The industrialproductionvalue in 2009 isvery optimistic;with up to 70percent of thecontributionfrom the eco-nomic groupsand corpora-tions. Eight eco-nomic groupsare gatheringefforts to com-plete many keyprojects toincrease thegrowth of indus-trial productionvalue by 12 per-cent this year.

? ĐINH THANH

ccording to commitments with the World TradeOrganisation (WTO), from 2010, tax on manyimported and exported agricultural, forest and

fisheries products in Vietnam will increase or reduce fromzero to three percent. Thus, in 2010, the objective impactson the development of agriculture are inevitable.

Double impact on fisheries

Although seafood export turnover in 2009 decreasednearly seven percent from a year earlier to reach onlyUS$4.21 billion, this was still considered a good year for tra

ECONOMIC SECTOR


AGRICULTURE FORESTRY FISHERIESToward Professional Production

Three major challenges for theVietnamese agriculture in 2010are many technical trade protec-tion barriers; higher requirementsof product quality; and strongeranimal and plant quarantineunder the SPS Agreement.

Illegal, Unregulated and Unreported (IUU) FishingLaw is a big barrier for Vietnamese fishermen

and basa catfish farming as it climbedto the No. 1 aquatic exporter positionwith an export turnover of US$1 bil-lion. However, Le Van Minh, FormerDirector of the InternationalCooperation Department under theMinistry of Agriculture and RuralDevelopment, said: "From the begin-ning of 2010, the fisheries sector willbe affected most by WTO provisions,particularly catfish.” According to ini-tial information, the US and somecountries are now causing very highpressure on pangasius (or tra catfish) inVietnam, especially food safety andhygiene aspects.

The hardest matter of theVietnamese fisheries sector is mostponds are using water from theMekong River and importing nationsusually blame polluted water on theriver in an attempt to raise a barrieragainst the Vietnamese seafood.Another challenge of the Vietnamesefisheries sector is the implementationof the EU agreement on Illegal,Unregulated and Unreported (IUU)Fishing. Mr Minh said: “The biggest dif-ficulty for Vietnam in executing theIUU is Vietnamese fishermen work insmall groups and it is very difficult toprove the origin of products.

Woodwork - Possible loss ofdomestic market

The total export value of wood-work and forest products of Vietnamin 2009 reached US$2.5 billion butimport value also amounted to nearlyUS$900 million. Mr Nguyen TonQuyen, Vice Chairman of VietnamTimber and Forest Product Association(Vietfores), said: "From January 1, 2010,most of tariffs on woodwork productsimported into Vietnam will decrease 0-3 percent.”

Thus, woodwork companiesindeed do not worry much about theexport market but the local market.This happens because, according toexperts, Vietnamese woodwork pro-ducers and processors have very lowcompetitiveness. So, when tax ratesfor imported woodwork products fall,costs of foreign companies willdecrease as a result, then most likely,the domestic market of Vietnam will

be the dominated by foreign compa-nies.

Foodstuff - Little impactAccording to the Ministry of

Finance, from early 2010, tax rates aretrimmed down from 1-6 percent fromexisting rates, in which the most com-mon decreases are in the 2-3 percentrange, with a total of 1,654 tariff linessubjected to WTO commitmentreductions. Particularly, agriculturalproducts imported from Australia,New Zeeland, Brunei, Myanmar andSingapore from January 1, 2010 direct-ly shipped to Vietnam will be imposedpreferential tax rates if they satisfyrules on the origin introduced by theMinistry of Industry and Trade.Specifically, the preferential tax rate forAANZFTA imported fowls is 5 percent;buffalo meat, fresh and frozen beef:10-15 percent, fresh and frozen pork:20-25 percent; buffalo and cow by-products: 7-15 percent, fowl products:10-20 percent; fish: 20-30 percent, milk7-25: percent; eggs: 7-15 percent; flow-ers: 25-35 percent and tobacco: 100percent.

According to Mr Le Van Minh, inthe near term, food items are notaffected very much but Vietnameseenterprises must pay attention to foodsafety and hygiene.

By a third challenge for agriculturein the coming year is VN: Many coun-tries began to apply technical barriersto trade protection, requirements ofhigher product quality and strength-ening quarantine, the material underSPS agreement. Therefore, the biggestproblem of agriculture is to changethe current practice of productionfrom small, to produce more profes-sional, otherwise farmers would be fur-ther away from the market becausethere are three major challenges forthe Vietnamese agriculture in thecoming year: Many countries applytechnical barriers to protect trade,requirements of product quality arehigher and animal and plant quaran-tine conform to the SPS Agreement.Hence, the largest challenge of theVietnamese agriculture is to changesmallholding production practicesinto more professional productionmodel; otherwise, markets forVietnamese farmers will be shrunk. n


Happy New Year2010

Toward decisive year 20102010 is the last year of the five-year

socioeconomic development plan from2006 to 2010; so, this year will be a year ofdecisive significance for the completion orexcess of socioeconomic development tar-gets and perfection of personnel apparatusat all government levels. The degree of com-pletion will lay the groundwork for govern-ments of all tiers to map out the next five-year socioeconomic development plan.Before this opportunity and, maybe, a chal-lenge, activities of VCCI in 2010 will focus onimproving the business environment, espe-cially at local levels, to support businesses torestructure, provide information and train-ing for enterprises basing on current inter-national development trend, enhance inter-nal management capacity, develop humanresources, renovate technologies, build anddevelop corporate trademarks.

Notably, in 2010, VCCI will complete thedraft scheme and resolution on VietnamEntrepreneurs with the content focusing on“Promoting the role of Vietnamese entre-preneurs in the process of industrialisation,modernisation and international integra-tion” to submit to the Politburo; build andorganise the execution of action plans ofVCCI and the business community when thescheme and resolution are adopted. This isconsidered the most important task of VCCIin 2010 and in the following years.

Besides, VCCI will continue to maintainand promote activities of business forumsand established business councils (China,Africa, Japan, EU, US, Russia, Ireland andASEAN); set up and implement activitiesVietnam - India Business Forum, Vietnam -GMS Business Forum and launch Vietnam -US and Vietnam - Russia e-commerce por-tals. It will propose the Government ascheme to organise regional economicforums like the northern coastal economicforum, northwest economic forum, centraleconomic forum, Central Highland econom-ic forum, Mekong Delta economic forum,etc.

At the same time, VCCI will organiseevents on the occasion of Vietnam’stakeover of ASEAN Presidency; VCCI’sundertaking of ASEAN CCI like ASEAN BIS2010, ASEAN BAC Dialogue with ASEANLeaders ASEAN Business Award (ABA), etc.

(from P.9)

ECONOMIC SECTOR


hy Still Employees at Home MarketWThe domestic manufacturing of mechanicalequipment and the formation of strong cor-porations to undertake Engineering,Procurement and Construction (EPC) con-tracts are inevitable steps of Vietnam tobecome an industrialised country.

Lilama Corp is a typical example of successful domestic companies that can join and wininternational tenders; thus, creating many jobs and incomes for Vietnamese people

owever, in the past foreigncontractors mostly beatVietnamese companies in

the price-based competition for EPCcontracts for building coal-fired powerplants, cement plants, fertiliser plants,oil refineries and others. According toeconomic experts, this warns us of ashort life of Vietnamese EPC contrac-tors on the home market if we do nothave sound policies topromote internalforces.

P r e d o m i n a t i n gforeign contractors

According to thestatistics from theMinistry of Industryand Trade and theVietnam Associationof MechanicalIndustry (VAMI),Vietnam has to spenda large sum of capitalto synchronise equip-ment for such indus-tries as energy, build-ing material, chemical,aluminium mining,etc. This is a cause forthe rising trade deficit.Only four industrialsectors of thermalpower, hydropower,cement productionand alumina process-ing require nearlyUS$110 billion to import equipment.

If chemical, petrochemical, con-struction machinery and other indus-tries are included; the needed capital isestimated at US$250 billion in the2008-2025 period, a mammoth figure.Mr Nguyen Van Thu, Chairman of VAMI,said: With aforementioned amounts ofcapital, if we have right strategies, ahalf of value spent on equipment (anequivalent of US$100-130 billion) willgo to domestic enterprises, not for-eigners who prefer imported equip-ment.

Citing several ongoing projects, hesaid, 23 hydropower plants with anindividual capacity ranging from 50MW to 2,400 MW are being furnishedwith electromechanical equipmentimported by foreign contractors.Amongst 11 power plants that run on

coal, only the expanded Uong Bi plantis undertaken by Vietnamese EPC con-tractor, Lilama Corporation, while oth-ers are carried out by foreign EPC con-tractors. Amongst 12 gas-fired powerplants, nine are built by foreign EPCcontractors. Amongst 18 cementplants, only Song Thao plant is built byLilama Corp while 17 others are imple-mented by foreign contractors.

“Remarkably, the publicis discontent with the wayforeign contractors are con-ducting business. Foreigncontractors even bring man-ual workers from their nations toVietnam and they even import equip-ment local enterprises can produce,”Mr Thu added. “We are resigned to see-ing them provide jobs for their country-men while our workers are shruggedoff or offered extremely low-paidworks. Even, materials available andusable in Vietnam are also importedfrom their nations.”

Domestic contractors: Fromemployer to employee

Mr Nguyen Hiep, President ofHousing and Urban DevelopmentCorporation (HUD) under the Ministryof Construction, said: Song Thao

cement plant with an annual capacityof up to one million tonnes recentlyhanded over to the investor (HUD) bythe contractor Lilama Corp with up to70 percent of locally sourced materialvolume and 40-45 percent of the local-ly contributed value. The domestic con-tractor has undertaken design, equip-ment manufacturing, installation andother activities.

VAMI Chairman Nguyen Van Thuadded: According to constructionexperience, to build projects worthUS$250 billion, the workforce needs toreach 2-2.5 million workers, excludingmechanical workers at equipment pro-duction factories, design engineers andproject managers. For instance, theUS$2.5 billion Dung Quat refineryneeds 22,000 construction workers at

peak time. If domestic EPC contractorsundertake these projects, they will cre-ate jobs for millions of workers - anactivity that will help many. With thecurrent situation, our contractors arebecoming employees in their homemarket.

According to economic experts,most industrial corporations in theworld need to carry out 5-7 EPC pro-jects to turn professional. Therefore, weneed to establish a strategic plan forthe construction and development ofmany industrial corporations to under-take EPC contracts. n


Happy New Year2010

The expanded Uong Bi 1 thermalpower plant has been completed andhanded over to the Electricity ofVietnam (EVN) and the contractorLilama Corp reports to use up to 55percent of locally sourced materialsand 20-25 percent of local value. Inregards to Nhon Trach 1 andNhon Trach 2 power plants,Lilama Corp won an internation-al tender with a discount ofUS$100 million for Nhon Trach 2and US$30 million for NhonTrach 1. This proves that domes-tic companies can join and wininternational tenders for thermalpower projects, thus creatingmany jobs and incomes forVietnamese people.

Mr Pham Hung, General Director ofLilama Corp, said: “This issue needsto be viewed in the angle of Statemanagement and we need to placenational interest on top to changeour ways of doing business. Only50 percent of work is undertakenby domestic contractors, this willhelp increase Vietnam’s annualGDP significantly. On the otherhand, the profit generated will beof the State (if the contractor isstate-owned enterprises), or atleast in Vietnam (if the contractor isa private enterprise).

ECONOMIC SECTOR


Addressing The United Nations saidthe global investment isestimated to reachUS$1.4 trillion in 2010and US$1.8 trillion in2011. Of the sum, 4 per-cent will go to develop-ing countries and this isthe opportunity forVietnam to attract FDI inthe coming year.

? HA DUY TINH

e visited the construction site when the winter hadjust come. Mr Nguyen Viet Xuan, project managerfor EPC contractor Lilama Corporation, gave each

of us a pair of boots to visit the site but they seemed not to beenough. The construction site was covered with earth and mud.Water turned earth into mud which was nearly equal to ourboot height. Witnessing diligent workers on the site, I reallyadmired them.

After undertaking the EPC contract for Vung Ang 1 ThermalPower Plant project on August 27, 2009, Lilama Corporation -the EPC contractor - has completed selecting subcontractorsand signing contracts for major packages of the project.

Domestic contractors include Lilama Corporation, SongHong Construction Corporation, Bach Dang ConstructionCorporation and PetroVietnam Construction Joint StockCorporation (PVC) all of which simultaneously started mainitems on December 1, 2009 (seven days ahead of schedule).

Subcontractor Song Hong Corporation is in charge of build-ing foundations for boilers 1 and 2. Mai Anh Tuan, deputy direc-tor of Song Hong 25, said that the geological conditions werevery complex because of geological fractures. The company hasto use two types of special drillers. It takes 16 hours to drilldown two metres on monolith. On average, the company drove5 - 7 stakes a day.

Nguyen Viet Xuan said: The Company has completed build-ing supporting areas, canals (2,600 m), drilling 56 out of 70needed boreholes and has started drill-testing the coal storingarea. To date, the company has driven in 47 out of 361 pileswith a diameter of 800 mm and an average length of 20 m onthe first boiler foundation. Under the plan, the staking work willbe completed at the end of March 2010 and the next founda-tion processing will be finished in late April before installingequipment. Expectedly, the first equipment delivery will reachthe site in late January.

To keep up with the progress, contractors have sent 350managers, engineers, workers, concrete mixers, drillers andtrucks.

The Vung Ang 1 thermal power plant has two 600 MW tur-bines, totalling 1,200 MW - one of 16 key power projects in thecountry from 2006 to 2010 approved by the Government. Thisis to date the largest power plant invested in by the VietnamNational Oil and Gas Group (PetroVietnam) and built by EPCcontractor, Lilama Corporation. The first turbine is scheduled togenerate electricity in July 2012 and the second turbine willstart operations in January 2013. Both will annually producenearly 8 billion kWh of electricity. n

VISITING VUNG ANG TO FEELHUSTLE AND BUSTLE

? LUONG TUAN

he Foreign InvestmentAgency (FIA) under theMinistry of Planning and

Investment, said: Vietnam will remaina magnet to FDI capital in 2010.However, to maximise the effective-ness of this investment capital source,the country needs to overcome theweakness of infrastructure, improvethe legal framework and createfavourable conditions for registeredFDI to be disbursed.

In 2010, Vietnam is expected toattract US$22-25 billion of registeredFDI capital. The disbursed capital isestimated to reach US$11 billion, upabout 10 percent from 2009. In fact,weak infrastructure put a brake on FDIcapital disbursement. In 2008, regis-

tered FDI was US$71.7 billion but theactual disbursement was onlyUS$11.5 billion. In 2009, the valueswere US$21.48 billion and US$10 bil-lion in 2009, respectively.

The low percentage of FDI capitaldisbursement distressed many for-eign investors. In 2009, the number ofcountries investing in Vietnamplunged. Only four out of 89 countriesand territories continued with theirnew investment projects in Vietnamin 2009.

According to Mr Dang XuanQuang, Deputy Director ofInvestment Department under theMinistry of Planning and Investment,the infrastructure systems like elec-tricity, water, traffic, seaport andother facilities are still very weak. Siteclearance still encounters many diffi-culties. Although Vietnam has joinedthe WTO for more than 2 years, it stilllacks instructions on conditionalinvestment sector. According to thelaw, there are some 70 conditionalinvestment areas for which there areno instructions.

In fact, in the past time, Vietnamhas adopted a number of solutions toimprove the investment environment.Most recently, in the report submittedto the Prime Minister, the ForeignInvestment Agency proposed eightmeasures to attract FDI capital, focus-ing on law and policy; planning; infra-structure improvement; humanresources management , investmentpromotion ; with an aim to draw thenew wave of investment when the cli-mate is over.

Creating a healthy business envi-ronment and promoting social advan-tages are very important for thedevelopment of the economy. Inrecent years, Vietnam has successfullycarried out trade and investment pro-motion activities. Economic expert LeDang Doanh said: “In 2010, the worldeconomy recovers, Vietnam can

expect an increase in FDI. If Vietnamwants to attract more FDI, it needs toimprove the infrastructure and theinvestment environment. If the infra-structure is poor, seaports are inca-pable, traffic congestions are frequentand electricity supply is instable, itwill be very difficult to attractinvestors.”

One of the areas has not attractedmuch FDI capital is agriculture.According to the statistics released bythe Foreign Investment Agency, overthe past 20 years of enacting FDIattraction policies, the number of FDIprojects in agriculture, forestry andfisheries is very small. In particular, in2009, agriculture accounted for lessthan 1 percent of FDI value injectedinto Vietnam.

Vietnam is an agricultural countrybut the investment capital for thissector is the lowest; thus failing toreflect the potential of this sector. Themain reason is, according to DangXuan Quang, the Vietnamese agricul-tural production is still small and scat-tered. Besides, unguaranteed

seedling and techniques also keepforeign investors away from the agri-cultural sector. According to theForeign Investment Agency, out of839 FDI projects with registered capi-tal of US$21.48 billion in 2009, only 16investment projects with a registeredcapital of US$84.9 million wereinvolved in agriculture, forestry andfisheries.

Mr Do Duc Dinh, Director ofVietnam Socioeconomic ResearchCentre, said: The agricultural sector ofVietnam has a lot of potential. Toattract foreign capital, Vietnam needsto have the land fund large enough toimplement key agricultural and hi-tech projects, create favourable con-ditions in policy and tax for agricultur-al investors. n


Barriers for FDI Attraction

Happy New Year2010

In 2009, despite facing harshimpacts by the global economicslowdown, Nghe An provincemade encouraging achievementsin socio-economic development.Could you give your comments onthe province’s achievements?

Last year, impacts from the eco-nomic downturn, slowdown in thedomestic economy, natural disastersand diseases brought about manychallenges for Nghe An during itssocio-economic development. Underthe leadership of the provincialPeople’s Committee coupled withthe effort by local agencies, ministriesand people help to maintain theprovince’s stable economic growth.Our province has seen quite highgrowth in some economic sectorsand local people’s living conditionhas been ensured.

The province has gained encour-aging results in preventing economicslowdown and maintaining econom-ic growth and its economic develop-ment has gradually recovered. It hasfocused on attracting investment anddevelopment businesses. In addition,Nghe An has carried out social securi-ty policies well and cared about thepoor’s living condition, beneficiariesof social welfare and those living inremote and disadvantaged areas. Ithas also gained progresses in social,

cultural and sci-tech development.The administrative reform and anti-corruption activities have also seenpositive changes, and security,defense and social order are ensured.

According to statistics, theprovince achieved an economicgrowth rate of 7.13 percent in 2009,surpassing the set target. In spite ofmeeting with many difficulties due tonatural disasters and diseases, thelocal agricultural production valuewas still up 3.53 percent on-year.Total output of food was estimated at1.09 million tonnes; the total numberof poultry was higher than 2008.Meanwhile, aquatic catching andbreeding output was estimated at92,767 tonnes, up 7.66 percent on-year. The industrial production valueincreased by 8.7 percent and servicesup 9.01 percent. Export turnoverreached US$220 million. Theprovince’s total state budget collec-tion stood at VND3.75 trillion, up 21percent on-year.

The province held an investmentpromotion conference early this year,attracting 26 projects. The provincelicensed 60 investment projectsworth VND13.35 trillion in 2009,including some big ones such as SaiGon-Tan Ky Cement Plan valued atVND1.39 trillion and milk cow breed-ing project worth VND6.3 trillion. The

LOCAL ECONOMY


NEW YEAROn the occasion of New Year 2010,Vietnam Business Forum had aninterview with Mr Phan Dinh Trac,Chairman of the People’sCommittee of the central provinceof Nghe An.

New Status and Strength

locality set up 859 new businesses, up12 percent against 2008.

Nghe An created 30,600 jobs forlocal people. It recruited and trained44,200 people, raising its trainedlabourer rate to 38.5 percent. Thetraining quality has been improved.The province had 15 students whoranked first in the tertiary educationexam, 229 gained high marks, rankingthird nationwide.

The province also announcedadministrative procedures sets at theprovince, district and commune levelsand reviewed and simplified at least30 percent of administrative proce-dures under the government’s instruc-tion. IT application in state manage-ment is paid more attention to,besides, securities and defense situa-tion is also ensured.

In 2008, Nghe An’s ProvincialCompetitiveness Index (PCI) con-ducted by the Vietnam Chamber ofCommerce and Industry (VCCI) wasin the middle. In 2009, its rankingslipped four levels. Is the localbusiness environment in trouble?

The PCI ranking was based on a

survey of private companies. Despite afall of four steps, the province’s totalpoints was higher than 2008. Nghe Analways concentrates on the invest-ment and business environment. Itsinvestment attraction result in 2009was the highest-ever. We do not stop,but always try to improve the invest-ment environment. We recognise thatweak management of leaders is alsoamong the main factors affecting theprovince’s socio-economic develop-ment. Effort by some local agenciesremains weak.

What are the province’s goals in2010?

2010 is the last year for theprovince to implement its five-yearsocio-economic development plan;therefore, the province will have tocomplete many tasks. The provincehas worked out the goals namely tap-ping potential and advantages to luremore investors as well as using allresources for socio-economic devel-opment effectively for business devel-opment as well as boost economicstructural transition; focusing onimplementing key works and projects;

economic and technical projects inpotential areas; forming areas asmomentums for economic develop-ment: Vinh-Dong Nam Economic Zoneand Nam Nghe-Bac Ha Zone; HoangMai-Dong Hoi and Nam Thanh-BacNghe and Tan Ky-Do Luong-NghiaDan-Thai Hoa-Quy Hoi and Tay NgheAn; continuing the urban and ruraldevelopment in line with Programme21/CTTU and deploying the nationalprogramme on building new ruralareas in the 2010-2020 period; creat-ing jobs and fighting against poverty;improve healthcare services, humanresources and training quality; gainingachievement in administrative reform,applying IT and ensuring security andsocial order to offer favourable condi-tions for socio-economic develop-ment.

What should be done to fulfillits goals?

We will improve the investmentenvironment; boost production andbusiness activities; fight corruptionand reform mechanisms and policies;


Happy New Year2010

Cua Lo in Nghe An province is consideredone of Vietnam's most beautiful beaches

(continued on P.43)

Creating attractive business environ-ment

Can you talk about the local admin-istrative reform which is considered asuccess story ?

Da Nang City has carried out adminis-trative reform since 2001 and the adminis-trative units from the central to local gov-ernment have currently applied a singlewindow mechanism. Investors need only avisit to the Department of Planning andInvestment for their investment applica-tions and receive the licenses, seals and reg-istration code. Foreign investors doing busi-ness outside industrial parks will work withthe Investment Promotion Centre.

The city also supports subordinatedagencies and units to open and upgradewebsites and send administrative servicesonline. Record management software usedat the reception division is now beingapplied to 50 percent of communes andwards and is prepared to be installedthroughout the city.

In the coming time, we will acceleratethe administrative reform by applying infor-mation technology and renovating man-

agement and administration practices. Atthe same time, we will conduct surveys onpublic satisfaction of public administrativeservices.

How is the business informationchannel?

In the past, Da Nang has spared noeffort to provide legal information for busi-nesses in the best ways. First of all, the citypublicises the information on land, plan-ning and pricing on mass media. Secondly,it clarifies activities of administrative organs.These two matters facilitate the monitoringand help collect opinions to improve publicadministration.

Authorities of Da Nang city have active-ly and regularly held direct dialogues withlocal people and businesses, listened totheir opinions to amend policies when nec-essary.

Would you mind providing detailsabout the business incentive policies?

Since 2005, the city has provided sup-ports for producers of key exported indus-trial products. Accordingly, companies aresupported with 50 percent of interest ratefor investment and development loanstaken from State credit institutions in threeyears. The municipality supports 50 percentof funds for implementing researches onapplying science and technology to pro-duction expansion; 30 percent of the valueof technological renovation consultingcontract; and 100 percent of the fund fornew trademark registration in the countryand aids VND10 million for trademark regis-tration in foreign countries.

To help businesses overcome therecent crisis, the city lent to several localcompanies, sourcing from the Da NangDevelopment Investment Fund.Particularly, 15 enterprises borrowed nearlyVND163 billion (nearly US$10 million) forinfrastructure investment and 17 compa-nies were lent nearly VND54 billion to boostexport and industrial production.

LOCAL ECONOMY


Promoting Local Da Nang repeatedly camefirst in the ProvincialCompettiveness Index(PCI).Vietnam BusinessForum had an interview withChairman of Da Nang CityPeople’s Committee, TranVan Minh, on the commit-tee’s effort to improve thelocal business climate. DaNang now has more than11,800 private enterpriseswith a combined registeredcapital of VND28.5 trillion(US$1.58 billion). The largestcity in the central Vietnamhas also lured 164 FDI pro-jects with a total investmentcapital of US$2.62 billion, ofwhich foreign investors dis-bursed US$1.29 billion and96 projects have been putinto operation.

Upgrading infrastructure

How is the local workforce devel-oping?

Da Nang people have a relativelyhigh intellectual level and Da nang is oneof the first two localities in the country tocomplete the universalisation of sec-ondary education. Thanks to land and taxpreferences, the city has created bestconditions for private-run and state-funded training units. At the end of 2009,the city was home to five universities andnine colleges, 48 vocational schools,including 27 private-run units, and manyresearch institutes.

Through such projects as 393, 284and 47, the city has trained hundreds ofpublic administration officers. With talentattraction policy applied over the past 10years, the city has attracted 711 high-level scientists.

Could you talk about infrastruc-ture development policies?

With policies of creating the landfund for infrastructure development andjoining all resources, many key infrastruc-ture projects have been carried out,including Dien Bien Phu Road, Han RiverBridge, Son Tra - Dien Ngoc coastal road,Nguyen Tat Thanh Road and ThuanPhuoc Bridge. The city has also activelycoordinated and supportedGovernment-financed projects like TienSa port expansion, Tuyen Son Bridge andHai Van Tunnel.

As one of three post and telecomcentres in the country, the Da Nang tele-com sector is now approaching thegrowth of developed nations. On theother hand, with the close cooperationbetween the Da Nang Centre forSoftware Technology and partners ofIndia and Japan, Da Nang takes the lead

in the country’s ICT readiness level in2009.

In general, infrastructure and humanresource quality play important roles inattracting investments for hi-tech indus-try and high-quality service. Da Nang willactively cooperate with other localities tobuild inter-province transportation trafficnetworks to raise the general competi-tiveness index.

Thank you very much!Reported by Thu Hong


Competitive Advantages

Happy New Year2010

Da Nang is rated one of thebest providers of public servicesfor enterprises, including marketinformation, business partnersearching, export promotion,trade fairs, hi-tech parks andrelated services.

Danang has many advantages to develop tourism

? HONG NGUYET

Breakthrough in difficultyAlthough global economic downturn

caused instable market prices, sale diffi-culties and soaring material prices, thedistrict’s industry and handicraft sectorstill achieved encouraging results. Outputvalue totalled VND1,070 billion, up 22.4percent over the same period.

Particularly, state-owned enterprisesmade VND26.7 billion, the private sectorturned out VND849.8 billion and individ-ual households took in VND193.5 billion.

Construction porcelain is still a pro-duction sector in Tien Hai district. Gas-fuelled glass and porcelain productiontechnology was initially applied in 1987and is being used on wider scale. With thenew technology, the porcelain and glassproduction industry turned to a newchapter as a better energy supply ensurespremium product quality and helpsincrease output. On average, local compa-nies turned out 4.2 million products val-ued at over VND300 billion and ceramictiles (wall and floor tiles) of the three com-panies valued over VND320 billion. VietTiep Crystal Glass Company manufac-tured over 15,000 products crystal glassproducts, of which half is for domesticmarket and the rest is exported toEuropean countries. Presently, Tien Haigas source is fuelling nearly 30 companies,mainly producing porcelain and potteryproducts. Tien Hai mineral water ore at adepth of 450 m, with a reserve of about 12million cubic metres, has been tappedsince 1992 at an annual output of 9.5 mil-lion litters, branded Vital and Tien Hai min-eral waters. Tien Hai is found to contain alarge reserve of brown coal, estimated at30 billion tonnes, a part of Song Hong coalbasin. However, the coal is distributed at adepth of 600 -1,000 m while the currentindustry capacity is beyond requirements.

Besides, the development of handi-craft industries was significantlyimproved since 2008. Local industries arequite diverse and divided into six basicgroups of bamboo and rattan weaving,engineering, handicraft, agriculturalproduct processing, furniture and build-ing material, and waste recycling. Thesesectors create jobs for over 21,000 work-ers who received an average monthly

income of VND480,000 while productionvalue reached 193.5 billion, accountingfor 18.35 of the industrial - handicraft sec-tor and representing a year on yearincrease of 8 percent.

Mr Vu Duc Hang, Chairman of TienHai People's Committee, said: In the pasttime, although the market prices ondomestic and global markets havechanged in wide ranges, especially thevolatility in exchange rate and gold price,the initiative and effort of local authoritiesand enterprises minimised adverseimpacts. Local businesses activelyexpanded cooperation to promote trade,collect and update market information,adjust operating activities to escape eco-nomic woes. The total retail revenue inthe district reached VND1,002 billion in2009, up 19 percent from 2008.

Trading forces has thrived in both thequantity and quality. The district has 245businesses and over 10,000 householdsinvolving commerce, including 4,000households doing business in 28 markets.At present, the district has upgradedthree markets. Particularly, the Thai Binhtrade fair on agriculture - trade - tourismin 2009 helped the district to introduce itspotential strength to investors. By joiningthis trade fair, enterprises will be moreaware of the role of trade promotion, themeaning of branding, quality registra-tion, exclusive product model in the pro-duction and business developmentstrategies.

LOCAL ECONOMY


Long Stride forwardIn spite of numerousexisting difficultiesarising from globalfinancial crisis, TienHai district, Thai Binhprovince still madelong strides in thepast year. The indus-trial and handicraftsectors significantlycontributed to thatdevelopment.

Solid advanceArguably, socioeconomic develop-

ment in Tien Hai province is relativelyquick and comprehensive, with manytargets being exceeded. The timely cul-tivation helped improve the quality ofproducts; fisheries continued to bedeveloped. On the other hand, cultural,health and educational aspects are alsodeveloped. Security, political stability,material life, culture and spirit of thepeople are ensured. These resultsdemonstrate active efforts of all levels ofauthorities, businesses and people inthe district.

However, the industrial and handi-craft sectors still have many shortcom-ings that need to be addressed. Forinstance, production is only focused onavailable products and there is no majorbreakthrough in new products. Exceptfor the State sector and large enterpris-es, the rest has very small operatingscales and does not have good gover-nance and development strategies.Workers are lowly skilled and uncre-ative. Sewage and industrial waste havebecome major concerns of the authori-ties and people where industrial parksare located. According to recent data,

only seven handicraft villages in Tien Haiare considerably developing, four vil-lages are operating at acceptable levelwhile 16 villages do not have regularwork.

The year 2010 is a transitional periodof the elapsed five-year socioeconomicdevelopment plan 2006-2010 and theupcoming five-year plan 2011-2015.This year, the Party Congress is sched-uled to take place, preparing for the11th National Party Congress. For thatreason, the realisation of plans set for2010 will be an important prerequisiteto promote economic development inthe coming years. The objectives thedistrict sets out for this year are toincreasing the total industrial and hand-icraft production value to VND1,488 bil-lion, up 24 percent compared to 2009,and raising the contribution of industryand handicraft to GDP to 52 percent.

The Year of Tiger in 2010 is openinga brighter horizon (global economiesare likely to grow up and there are manyimportant events to be organised in thenation). Economic stimulus measureswill continue to generate positiveeffects in 2010, and together with manyother policies, will facilitate the mobili-

sation of all resources for development.With political stability and better invest-ment environment, Tien Hai remains afavourite destination for foreigninvestors; thus, investment capital willincrease, enabling the district to speedup economic growth and industrial pro-duction, expand trade activities and for-eign economic relations, etc.

Welcoming the New Year, Tien Haiwill introduce more new solutions.Particularly, it focuses on instructing andfacilitating enterprises to increaseinvestment, renovate technologies,enhance capacity, and cut productioncosts to boost sales in ASEAN markets.The district will closely coordinate withother sectors to speed up the construc-tion progress in industrial quarters tocreate favourable investing spaces forinvestors. In 2010, Tien Hai will encour-age enterprises to invest in craft villagesto give a facelift to a shrinking tradition-al production model. The locality willalso instruct the expansion of commer-cial system, including the upgrading ofkey wholesale markets to boost salesand tourism. Expectedly, with thesepolicies, the industrial and handicraftsector will thrive in 2010. n


Happy New Year2010

The global economic crisis contin-ued to burden businesses in 2009. Inthat context, how were the activitiesof Vinacafé affected?

Many challenges inflicted businesseslast year due to the contraction of the mar-ket and soaring material prices. In 2009,the foreign exchange rate was high andvery volatile. On the other side, scarcity ofdollars made it difficult for enterprises tomake payments. As a producer, VinacaféBien Hoa could not avoid the adverseimpacts of the market. If the companymade an annual growth of 20 percent orhigher in previous years, the expansion in2009 was only 15 percent, indicating thatthe economic crisis has caused consider-able impacts on the company. However, ifcompared with other enterprises, theinfluence on Vinacafé Bien Hoa was actu-ally much lighter. Remarkably, VinacaféBien Hoa did not confront financial diffi-culties and debts - the woes of many peerenterprises.

While many businesses confronteddifficulties, Vinacafé still made an

impressive growth of around 15 per-cent. Can this be considered a success?

All of us worked hard in 2009 for thisresult. And it may come from our previousendeavours. Thus, we can say, to a certainextent that this is a good achievement.

What is the cause and motivationfor Vinacafé to develop in the crisis?

I need to confirm that Vinacafé BienHoa has grown steadily. There are manyreasons for this success. Firstly, Vinacafébrand is based on core values of strengthin quality, safety and hygiene of the prod-ucts. We strive to satisfy our consumers.

Vinacafé is not a mediocre, shallow brand.Secondly, Vinacafé Bien Hoa has a solid

financial background. This is, first of all,based on the previous effective perfor-mances, small loans, limited noncoreinvestment and resolution to its invest-ment plans. Thus, Vinacafé Bien Hoa wasnot strongly affected by the fluctuationson the financial, securities and real estatemarkets. This is the important factor tocreate a firm growth for Vinacafé Bien Hoaand also the factor to help us overcomedifficulties.

As you have said, the real, naturalcoffee taste is not only the strengthbut also the business principle ofVinacafé Bien Hoa. Could you talkmore about this?

To date, Vinacafé has developed thebrand on solid foundations. We considerabout our consumers for each product.Our principle is that only when consumersare truly happy, will they support us in thelong term and become loyal consumers.Vinacafé has a huge number of loyal cus-

tomers as, based on these foundations,the company creates an relationshipbetween the company, products and con-sumers. And, that is also the direction thatVinacafé adopted in its early days.

We found out that a consumer, nomatter how long he or she has been drink-ing coffee, always requires a true, real cof-fee, not a heavily processed, mixed coffeewith flowery packaging. Therefore,Vinacafé must be genuine coffee with anatural taste. It is very difficult to producereal coffee. It requires advanced technolo-gy, which of course results in high cost.But Vinacafé still follows this orientation to

ENTERPRISES


VINACAFÉ Know-how in the

The year 2009 may beconsidered a difficultperiod for the businesscommunity: an esti-mated 20 percent ofcompanies stoppedproduction and busi-ness operations and60 percent slippedinto difficulty.However, many busi-nesses still thrived andcontinued to expandtheir market positions.Vinacafé Bien HoaJoint Stock Companyis an example of thesteady growth duringthe recession. On theoccasion of the NewYear 2010, theVietnam BusinessForum has been grant-ed an exclusive inter-view with Mr Bui XuanThoa, General Directorof Vinacafé Bien HoaJoint Stock Company,on this success.

create the premium coffee. When youdo not spend much on technology andmaterials, you must use additives. Youmay gain competitive price in the shortterm but your success can’t be longbecause consumers have more refinedtastes and they will know which thebest coffee is.

Coffee is a beverage. How doyou address hygiene and safetymatters?

A beverage must be safe for users.Safety is one of the top priorities wemust comply with. In fact, Vinacafé is

always safe. We strictly control ourproducts to get rid of hazardous sub-stances, especially coliforms - one ofour top concerns during production. Ican confirm that Vinacafé has high stan-dards of quality, and our products passall criteria imposed by importers inother nations. This is the pride ofVinacafé. We are proud because, todate, only Vinacafé has such a high levelof purity and safety in its products.

The crisis had no signs of end-ing, so many businesses decided todownsize their operations. But

Vinacafe branding activities contin-ue. The world’s largest cup of coffeeis an example. Why did Vinacafékeep investing in branding activi-ties when the market faced manydifficulties?

Vinacafé is a growing business andbranding is not expenditure. It is aninvestment. Actually, so far, consumershave known Vinacafé mainly for its out-standing quality. But, to win the heart ofconsumers and create widespreadeffects, we must have activities to let con-sumers learn more about Vinacafé prod-ucts with their high quality and naturaltaste. We have adopted many promo-tions, but the desire of Vinacafé is thatconsumers could have the exact informa-tion of our natural, real and safe products.

Thank you very much!Reported by Quoc Hung

F


Taste of Nature

Happy New Year2010

Vinacafé’s booth at the International Trade Fair in China

ENTERPRISES


PTSC Phu My port

s a member of State-ownedVietnam National Oil and GasGroup (PetroVietnam), in recent

years, PetroVietnam Technical ServicesJoint Stock Corporation (PTSC) has gradual-ly mastered specialised sciences and tech-nologies to supply oil and gas contractorsand PetroVietnam’s units with high-qualitytechnical services. Vietnam Business Forumhas a talk with Mr Nguyen Hung Dung,General Director of PSTC, about his achieve-ments.

Could you give a brief introductionof PTSC outstanding achievements inthe past years?

After 16 years of construction anddevelopment, PTSC has made preeminent

Quality PTSCAs a member of State-owned Vietnam

National Oil and Gas Group (PetroVietnam), inrecent years, PetroVietnam Technical ServicesJoint Stock Corporation (PTSC) has graduallymastered specialised sciences and technologiesto supply oil and gas contractors andPetroVietnam’s units with high-quality technicalservices. Reporter of Vietnam Business Forumhas a talk with Mr Nguyen Hoang Dung, GeneralDirector of PSTC, about his corporation’sachievements.

achievements with 20 member units, twojoint ventures in Singapore, a branch inMalaysia and is currently completing pro-cedures to open branches in Cuba andVenezuela. PTSC is now providing a varietyof key technical services with world-classquality for the oil and gas industry like spe-cialized ship service, supply base services,design service, fabrication, installation,commissioning of oil and gas facilities,FPSO/FSO, operation and maintenance(O&M) services, ROV survey service, equip-ment supply service, etc.

The creator of spring force for PTSC isthe well-trained workforce which consistsof technicians with profound experiencein building key national projects like 5B Bidand pipeline -tank system in Dung Quat oilrefinery, Dinh Co gas compression plant.All projects undertaken by PTSC areensured of construction progress andtechnical quality and are highly appreciat-ed by customers. PTSC has more than5,000 employees, including over 2,000graduates of university level and higherand over 3,000 technical workers. This isreally an invaluable resource of not only

PTSC but also the Vietnamese oil and gasindustry.

PTSC possesses a fleet of 20 modernservice ships, positioning ships, fireguardships, protection ships and patrol ships.Most ships can operate in any weatherconditions and are certified by interna-tional registration authorities in the UnitedStates and Norway under the authority ofthe Vietnam Register. This is a largest fleetof specialised ships in Vietnam and PTSCexpects to expand the fleet to 100 ships in2025.

Oil and gas mechanism is anotherspearhead of PTSC. The corporation hassupplied a lot of complex oil and gas struc-tures that required very high technologi-cal levels like LQ projects for JapanVietnam Petroleum Company (JVPC) andPetronas; BOA, BOC and BOD projects for

Talisman Malaysia and gas compressionstructure for PB. At present, the corpora-tion is currently building Su Tu Den DongBac oilrig invested by Cuu Long JointOperating Company, Premier Oil - ChimSao project, and Topaz project forPetronas. PTSC has also built 3,000 - 5,000-HP ships for its own activities. PTSC is anEPC contractor of Dung Quat Bio-ethanolBiofuel production project, takes charge ofproviding technological rights, designing,procuring, constructing, test-running andhanding over the plant to the investor,PCB. This is the premise for PTSC to take innew EPC contracts for other key oil andgas projects. Recently, Talisman MalaysiaLimited has officially announced that PTSCwon an international tender to lease PSVDP2 ships in five years for more thanUS$35 million. This is a turning point inrealising the strategy to diversify key oiland gas services for domestic, regionaland international markets, especially PSVDP2 positioning ship services. These ser-vices ensure stable revenues and profits ofPTSC

The PTSC deepwater seaport system

lying across Vietnam is serving oil and gassearching, exploration and productionand other activities. PTSC’s ports currentlyinclude Vung Tau, Phu My, Dung Quat,Hon La, Nghi Son, Dinh Vu and others.Amongst them, several ports have beenput into service like Phu My Port with awharf length of 384.3 m capable of accom-modating ships of 50,000 tonnes.Although the port has been opened formore than one year, the port has servedover 1.5 million tonnes of goods. PTSCDinh Vu seaport functions to serve oil andgas searching, exploration and productionactivities in Tonkin Gulf and Red RiverDelta while also serving goods, materials,machinery, general goods, containergoods exported and imported byinvestors in the Dinh Vu Industrial Parkand other local enterprises. Nghi Son port

is designed to serve Vietnam’s second oilrefinery - Nghi Son in Thanh Hoa province.

Recently, PTSC has honourably award-ed the second-class Independence Medalby the Party and the State. On this occa-sion, PTSC launched a 5-tonne floatingbarge, inaugurated 4-star Vung Tau PetroHotel costing approximately VND300 bil-lion. In addition, PTSC is implementingmany other important projects.

Apart from petroleum port ser-vices, which sectors are also thestrengths of PSTC?

Apart from providing petroleum portservices, PTSC is the only owner, managerand operator of the only crude oil storageand exporting facility in Vietnam. This facil-ity is operated together with offshore oil-rigs and has direct impacts on productionoutput in each oil field with strict safetyand environmental protection require-ments. PTSC has joined hands with foreignpartners to operate and co-own floatingstorage offloading vessel (FSO) forTalisman Malaysia Group and a FloatingProduction Storage and Offloading (FPSO)

vessel for Petronas Group. Presently, thecorporation is investing in FSO-5 vesselwith a storage capacity of more than150,000 tonnes for Vietsovpetro oil andgas joint venture. So far, the ship is basical-ly completed and nearly completed foroperation.

With the experience with foreign part-ners, PTSC has gradually extended its ser-vices to international markets like provid-ing service ships in Sakhalin (Russia) andfabricating four rigs for Malaysia.“Dominating the domestic market whileexpanding international markets is theoperating philosophy of PTSC in 2009.”PTSC has opened representative offices inMalaysia, set up two joint ventures inSingapore to manage oil and gas technicalservices that PTSC provides for oilrigs in


Happy New Year2010

Is a Gauge of Success

(continued on P.51)

? QUOC HUNG

Shining star in constructionindustry

Mr Thuan is not a stranger for theVietnamese real estate and construc-tion sector. From a small premise inLong Xuyen district 13 years ago, SaoMai An Giang has grown up becomea prominent company of theVietnamese construction industry.Starting with small construction pro-jects in the southern province of AnGiang, the company has accumulat-ed capital and experience to reach itscurrent stature. Only a few yearslater, larger contracts came to SaoMai and the group started extendingits arms to other localities, but not HoChi Minh City where the marketpotential is huge but the competi-tion is very fierce. In 2000, the com-pany reached a new high after it suc-cessfully built high-end Sao Maiurban zone in Long Xuyen district,An Giang province. At that time, acondo in a far-lying province like AnGiang has become a symbol ofurbanisation and a driving force forfollowing projects like high-gradeWard 7 residential zone in Ben TreCity, Sao Mai Resort and SouthKorean specialist hotel in Vung TauCity, Vam Cong seafood processingfactory, etc. The presence of VamCong seafood processing factory willextend the arm of Sao Mai An Giangto catch higher goals as expected byits founders.

In 2008-2009, while many otherbusinesses struggled to survive, SaoMai An Giang recruited additional2,000 workers and enjoyed the profitof 42 percent and dividend to reach

30 percent. In spite of being a new-comer in the field of seafood pro-cessing, Sao Mai An Giang has quick-ly affirmed its position andapproached key markets like the US,Europe and the Middle East. Lookingover unaudited business results in2009, Sao Mai An Giang still made agreat achievement amid the worstglobal economic crisis in decades asits profit doubled the amount gainedin 2008 and dividend payout ratioreached 100 percent (paid in shares).

Expansion

In the development strategy for2010, Sao Mai An Giang plans toadvance to Ho Chi Minh City by start-ing with the construction of 32-floortwin towers in District 8, whichrequires a total investment capital ofover VND1,000 billion. In addition,Sao Mai An Giang has created a sig-nificant fund land in Hanoi to buildanother twin towers in 2011. At itsVam Cong seafood processing facto-ry, the group even humanitarianlyinvested VND14 billion to construct arestaurant in order to provide twofree meals for workers

Apart from construction,finance, restaurant, hotel andtourism, Sao Mai An Giang alsoraised and processed aquatic prod-ucts for export, bringing the corpo-rate workforce to 4,000 people.With such a scale, plus financialstrength and prestige, 60 percentof shareholders at Sao Mai AnGiang are foreigners. Hence, under-standably, General Director LeThanh Thuan has a thick scheduleof far-going business trips wherehis wisdom, experience and quality

ENTERPRISES


S A O M A I A N

Reaching

In 2008, Deputy PrimeMinister Nguyen Thien Nhanreceived a special letter froma businessman in MekongDelta who bemoaned of somany pupils dying due todrowning. The letter reads“His Excellency DeputyPrime Minister, as a south-erner living in a water-cov-ered region, I feel very bro-ken-hearted to know of thedeaths of pupils across thenation. Their deaths are dueto their never havinglearned to swim. You are thehead of education sectorand you certainly feel sad-dened. I think you shouldthink of establishing a swim-ming teaching fund. Thisfund will mobilise contribu-tions from individuals andorganisations and our Groupwill voluntarily contributethe first VND3 billion.” Theauthor of this letter is thefounding president and CEOof Sao Mai An Giang Group,Le Thanh Thuan.

help him get the respect of partnersand bring the value to the company.

In its 5-year development planfrom 2010 to 2015, Sao Mai will investVND1,500 billion to build the 260-haVam Cong port and industrial parkcomplex to facilitate export of goodsin the Mekong Delta to reach interna-tional ports. This project will servemore than 10 large factories and cre-ate spaces for storing about four mil-lion tonnes of goods. The secret tomake success in the time of crisis issummarised very simply by Mr Thuan:“We are deeply aware that any crisiswill be over but the decision is toinvest for the upcoming great oppor-tunities.”

Taking care of education Recently, on January 9, 2010, Sao Mai

An Giang established the “Sao MaiSchooling Fund” and donated VND10 bil-lion for the An Giang Department ofEducation and Training to build toilets forschools throughout the province. Mr LeThanh Thuan said: “The success of SaoMai largely depends on human resources.Human resources training and fosteringtalent are very important factors in eco-nomic, cultural and social development ofthe country. With that awareness, Sao Maiwants to contribute a part of its profits tothe education development by sponsor-ing the Sao Mai Schooling Fund.

The letter sent to the Deputy PrimeMinister in 2008 is the clear evidence of

the heart of a businessman for the com-munity. Over the past years, Sao MaiGroup annually donates more thanVND3 billion for social development.From 2006 to present, Sao Mai has col-laborated with the Vietnam Television inCan Tho City to set up the “Unlucky life”programme to call for supports fromkind hearts. Annually, the fund raises aconsiderable sum of money for unluckyfates. Experiencing numerous hardships,Mr Thuan, a communist party member,understands the misery of poverty. “I docharity work because of my sympathyfor the unlucky people.” Anywhere SaoMai invests, the people there will have abetter life because they are providedwith good jobs. n


G I A N G G R O U P

Far & Wide

Happy New Year2010

Vam Cong Industrial Park investedand developed by IDI

Hafele is one of the leadinginternational companies forfurniture fittings, architectur-al hardware, electronic lock-ing systems and technicalhardware advice. HafeleVietnam was set up in 1988with its three distributioncentres nationwide. VietnamBusiness Forum has an inter-view with Mr Dominik Fruth –General Director of HefeleVietnam Co.,Ltd on its busi-ness activities.

ENTERPRISES


HAFELE VIETNAMLooking toward Fruitful 2010

Could you please talk about HafeleCompany?

Hafele is a German company which was foundedin 1923 in the south of Germany in Swabia. Eventoday the company is still 100 percent family owned.Currently Hafele employs around 5,000 employeesworldwide with an annual turnover of around EUR900 million. Hafele is

one of the biggest hardware suppliers to the fur-niture and construction industry worldwide.

In Vietnam, Hafele started its operations in 1988with a representative office. In 2007 Hafele opened theLimited Company to be able to distribute locally. Atthis point Hafele Vietnam employs around 120 staff in

three offices: Ho Chi Minh City, Hanoiand Danang. Another new designcentre is coming in April this year inNguyen Van Troi Street, HCMC.

Hafele represents a number ofbrands in Vietnam like IxConnect,Startec, Aquasys, which are our veryown brand names as well as otherbrands from our distribution part-ners like Bosch, Blum & Grohe.

In Vietnam, Hafele offers a One-Stop-Shop solution providing onlythe highest in European quality fit-tings to Architects, Designers,Contractors as well asEndconsumers.

What sets Hafele apart? Despite having our very own fac-

tories in Germany, in Vietnam wesolely concentrate on the serviceand distribution sector. Hafele’sunique product range allows us tocater to furniture factories, contrac-tors as well as private home ownerswith a comprehensive selection oftop quality fittings.

Currently our range covers over130,000 different products world-wide, 70,000 of which are readilyavailable from our head office inGermany. To provide only the bestservice in Vietnam we have weeklyairfreight shipments from Germanyto Ho Chi Minh City. On top of thatwe also have three distribution cen-tres in Ho Chi Minh City, Hanoi andDanang that allow us to be as closeas possible to our customers andpartners in all provinces.Furthermore, we have our very owndelivery trucks and technical aftersales service to provide expert adviceand fast deliveries within Vietnam.

How were Hafele’s activities in2009?

2009 was also not an easy yearfor Hafele worldwide as the econom-ic downturn affected the construc-tion and furniture industry. Also, inVietnam we were confronted withthe difficulties as the furnitureexport industry suffered fromreduced orders from abroad espe-cially from the US and Europe.However with strong product inno-vation, product diversification and a

high service level we still managedto achieve a healthy growth in 2009and now look forward to an evenbetter 2010.

What would you like to say onthe occasion of the Lunar NewYear?

As you might know, 2010 marksthe year of 35 years of German-Vietnamese Friendship. TheVietnamese government togetherwith the German government havearranged over 60 events throughoutthe year including concerts, semi-

nars and visits from high rankingGerman government officials andbusiness delegations to Vietnam.Hafele is very proud to be part of thisexciting year in Vietnam and wewould like to extend this invitationto the Vietnamese Business Forumto enjoy and participate in theplanned events. Besides that I wouldof course like to wish all readers aprosperous and happy new year ofthe Tiger.

Thank you very much!Reported by Doan Tien


Happy New Year2010

speed up administrative reform;complete planning activities, partic-ularly in the construction sector;accelerate construction pace of keyinfrastructure projects such as BenThuy Bridge No. 2 and transportroutes in the west, opening Vinh-Hanoi flights early this year andbuilding Dong Hoi, Cua Lo and YenXuan deep water ports.

Particularly, we will help enter-prises to deal with difficulties in busi-ness and production activities anddevelop potential projects likehydropower, beverage, packaging,coffee, milk, traditional handicraftvillages and rattan for exports.

Creating favourable conditionsfor investors to speed up industrialproducts. It hopes to operate TanHong Pulp Plant in the first quarter ofthis year with an annual capacity of45,000 tonnes. In the second quarterof this year, two turbines of Ban VeHydropower Plant will come intooperation. In the quarter, Sai Gon -Song Lam Beer Plant and Hanoi-Nghe An Beer Plant are also expect-ed to become operational.Construction on the Sai Gon-Tan Ky,Tan Thang Cement Plant will start inthe first quarter; ensuring pace ofKhe Bo Hydropower Plant in 2011,Hue Na Hydropower Plant in 2012;operating Hop Son Cement Plant bylate 2010, and 12/9 Cement and DoLuong Cement in early 2011.

Continuing agricultural structuraltransition; reviewing the planningand rearrangement of plants andpoultry in agricultural production toreduce costs and damages due tonatural disasters; boosting animalbreeding, forestation, aquatic breed-ing, setting material growing areasfor processing industry, especiallypoultry, shrimp, crab, sugarcane,rubber, coffee, cassava and woodmaterials.

Enhancing the quality manage-ment of fertiliser and agro-forestry-fishery encouragement anbd boost-ing sci-tech application, particularlybio-technology in the productionand processing. Raising efficiency ofstate-owned enterprises’ operations,encouraging the development ofjoint stock companies.

Enhancing social securities,boosting the social-cultural develop-ment; fighting corruption and wasteand dealing with complaints.Facilitating security and defense andsocial order state management onsocio-economic development.

Which message would you liketo deliver on the New Year occa-sion?

This year, each local cadre, partymember and people need to joinhands with one another to createnew momentum for the locality’ssocio-economic development.

Thank you very much!Reported by Si Cu

(from P.31)

ENTERPRISES


? LE PHUONG

arkson Retail Group - a leadingMalaysian shopping mall operator-was one of the first foreign retailers to

enter Vietnam. The name Parkson may be a lit-tle strange to Vietnamese customers but it is aleading brand name in Malaysia and China.Parkson is the biggest retail group in Malaysiaand China with sale volume of US$ 1.3 billionper year.

In 2005, Parkson opened its first premiumdepartment store in Ho Chi Minh City- the firsttruly international department store, position-ing itself at the middle and upper-middle endof the retail market in Vietnam with a numer-ous number of well-known international fash-ion brands that have never been distributed inVietnam before including Porsche Design,Eternity, Sub Jeans, Soda Exchange, Baleno forapparels, Armani, DKNY, Tommy Hilfiger forcosmetics and fragrances. Favorite Vietnamesebrands such as WOW, Nguyen Jenny and

A Symbol ofSuccess and Pride

P A R K S O N V I E T N A M

In 2009, Viettel is one of thefew companies to obtain“opportunity in crisis”. Wouldyou mind sharing the secretand specific steps taken to dothis?

Arguably, 2009 was the hardestyear since Vietnam initiated doimoi (renovation) more than 20years ago. But, under the leader-ship of the Party and the propermanagement of the State, Vietnamachieved an economic growth of5.3 percent and was one of 12countries with positive growth andonly second to China. However, asthe telecommunications service isessential, it suffered less from eco-nomic slowdown. Meanwhile,Vietnam's telecom market has not

been fully tapped and has manypotentialities; thus, the growthremains as high as 60 percent in2009. For Viettel, right from thebeginning of that year, the groupstill set high annual growth tar-gets, and with the efforts of thewhole group, our growth was 80percent.

Our secret is we always find outthe opportunity in difficulty. Forexample, although we knewadverse impacts of internationalfinancial crisis on the economy ofVietnam, we still believed that theneeds for communication andinformation would grow up


“WE ALWAYS SEEOPPORTUNITY IN DIFFICULTY”

Happy New Year2010

Viettel Telecom Group has been officially established,becoming the eighth economic group in Vietnam.Currently, Viettel is operating the largest telecommunica-tions network in Vietnam. After 10 years, its revenuesclimbed 1,500 times to reach VND60 trillion (US$3.33 bil-lion) in 2009. On the occasion of New Year 2010, theVietnam Business Forum had an exclusive talk with MajorGeneral Duong Van Tinh, Deputy General Director ofViettel Telecom Group.

Donga Silk can also be found at Parkson, cre-ating a booming retail hub right in the heartof Ho Chi Minh City.

Over the years, Parkson has affirmed itsposition as one of the most favorite shoppingaddresses in Vietnam. December 2009 sawan opening of Parkson Flemington TradeCentre in HCM City. This is considered thebiggest shopping mall in Vietnam. TheParkson Flemington is the fourth Parksonoutlet in HCM City and the 6th nationwide.

Although Parkson has not reached its tar-get of opening from three to four centres peryear as planned, it is very confident about itssuccess in the coming time in Vietnam. Theglobal economic downturn hasn’t appearedto have dented Vietnamese shoppers’ enthu-siasm. In 2009, Parkson Vietnam achieved agrowth rate of 20 – 30 percent. “The successof Parkson Vietnam not only lies in its finan-cial strength, expertise, good managementsystem, but also in its understanding of themarket and of Vietnamese consumptionhabits”, said Mr Tham Tuck Choi, GeneralDirector of Parkson Vietnam.

In addition, to attract customers, Parksonoften launches promotion programs all yearround, special offers for Parkson privilegecard holders, giving special gifts for its mem-bers, issuing shopping coupons, etc.

Commenting on the domestic retail mar-ket in 2010, Mr Tham shared: “I see many pos-itive prospects in 2010. The Vietnam econo-my is showing good signs of recovery; highpurchasing power was back in late 2009.Moreover, as the Vietnam economy contin-ues to rebound, people will get goodincome. As a result, the demand for goodquality products, a prestigious and comfort-able shopping address is an ideal choice.Shopping channels such as supermarkets,commercial centres are substantially replac-ing traditional shopping channels inVietnam. Parkson sets a goal of being a leaderin every market that we penetrate. Hopefully,in the coming time, we will soon reach ourtarget of building 20 shopping malls inVietnam”.

Apart from doing business in Vietnam,Parkson especially puts a strong focus onsocial activities. One of the outstanding socialactivities is its Parkson’s Educare that was firstlaunched in Malaysia in 2001. The programproves the fact that Parkson not only bringsvalue to high to mid-end consumers but alsotakes an active role in improving the lives ofneedy people.n

The ceremony of launching Viettel Telecom Group

(continued on P.55)

ot confining its vision toexisting difficulties, leadersof Vinalines proactively

sought out opportunities even whenthe financial crisis was forcing manyworld-leading corporations to contractoperations. Those opportunities werepresented on the annual report on pro-duction and business activities of thecorporation in 2009. To be precise,proper and flexible solutions and poli-cies of the Government helped averteconomic recession and business col-lapse, maintain economic growth,macroeconomic stability and ensuresocial security.

In addition, the sea-based economyis attached much importance for devel-opment and the government hasactively participated in multilateral,multi-sector international cooperationin maritime industry, implementedsigned conventions, promulgatedmechanisms, policies and legal docu-ments related to maritime economicactivities, created favourable environ-ment for maritime companies to oper-ate and develop, including Vinalines.

While not a few small businessesonly know economic downturn conse-quences like declining input produc-tion costs (interest, fuel, constructionmaterials, labour, ship prices, etc),Vinalines feels that this is the opportu-nity to focus on mobilising capitalsources for intensive investment to cre-ate momentum for following develop-ment.

“Rejuvenate” ship fleet

According to the developmentplan, Vinalines would add up a tonnageof 200,000 tonnes to its shippingcapacity by building and purchasingused ships. However, taking the advan-tage of falling ship price, the corpora-tion’s subordinated companies seekcapital sources and liquidate their oldships to buy 13 dry-bulk cargo shipsand one container ship with a total ton-nage of about 320,000 DWT at a totalinvestment of about US$180 million.The corporation was delivered one22,500 DWT dry cargo ship fromVinashin, bringing the total number of


VINALINES Still FindLike any other busi-ness entity, the State-owned VietnamNational ShippingLines (Vinalines) heavi-ly suffered from theglobal economic reces-sion. However, thereare still opportunitiesin the time of crisis andthe shipping corpora-tion has grasped anyopportunities to sta-bilise, develop and“rejuvenate” its shipfleet, accelerate infra-structure constructioninvestment projectsand more importantlyreshuffle its corporatestructure.

Vinalines receives Flag of Emulation from Ministry of Transport

completely built ships to 25 ships with atotal tonnage of approximately 319,000DWT.

Also, the corporation liquidatedabout 140,000 tonnes of ship loadingcapacity for buying younger ships.

Thus, at the end of 2009, the corpo-ration’s total tonnage of the ship fleetreached approximately 2.7 million DWT,accounting for about 45 percent of thetotal tonnage of ships in the country.

Speeding up infrastructure devel-opment investment projects

Chosen the investor for national keyseaport construction programme, thecorporation has proactively preparedand launched two important projects,namely Van Phong international tran-

shipment port and Hai Phong interna-tional gateway port.

A number of other projects kickedoff previous years ago are also sped up.Specifically, the second phase of DinhVu - Hai Phong port project has com-pleted and put into operation piers 3and 4 with a total length of 450 m andcommenced construction on pier 5with a length of 225 m. The secondphase of Cai Cui port project consistedof three wharves with a total length of500 m, costing VND830 billion. Dinh Vuinternational container port project wasalso accelerated. The first phase ofSaigon Port - Hiep Phuoc port was start-ed with a capacity of handling about 8.5million tonnes per year and accommo-dating vessels of 50,000 DWT andrequired a total investment of aboutVND3,700 billion. SP-PSA internationalterminal joint venture developed byPSA Corporation in Ba Ria - Vung Tauprovince; Cai Mep international portproject; Saigon Port - SSA internationalcontainer port project in Ba Ria - VungTau developed in cooperation withAPMT and SSA; southern Vinalines ship

repairing yard; Nosco - Vinalines shiprepairing yard; Vinalines Hai Phong con-tainer warehouse; Lao Cai inland clear-ance depot and a series of projects areprepared for investment.

Perfect operating model

Starting being operated in the formof holding company since 2007, thegovernance of the corporation hasbeen gradually adjusted to fit the newoperating model, facilitating its sub-sidiaries and joint venture companies toboost production and business andpromote the efficiency of the State cap-ital. At present, the corporation is man-aging over VND6,000 billion of Statecapital in joint ventures, joint stockcompanies and one-member limited

liability companies. In the coming time,Vinalines leaders determined that theparent company needs to continueimproving the legal framework toenhance the role and performance ofrepresentatives of State equity in itssubsidiaries and associated companies.The corporation will rearrange and setup several advisory boards, adjust, sup-plement and promulgate regulationson internal administration, reformadministrative procedures, invest toenhance the performance of produc-tion and business management andadministration, and create favourableconditions for member enterprises todevelop.

In addition to streamlining theworking apparatus of the parent corpo-ration, Vinalines is actively reshufflingand changing operating model of itsSaigon Port Trading Services Companyfrom a State-owned company to a jointstock one; admitting three ports ofNghe Tinh, Quy Nhon and Nha Trang tobe its member enterprises and com-pleting the operating model transfor-mation of its member companies.

Representing the right and inter-est of members

Beside the role of an organiser andcreator of accommodating corridorand assistant of its member units,Vinalines was, last year, a positive rep-resentative for the rights and interest ofits member units and made worthycontributions to the process of build-ing legal documents to adjust the oper-ation of enterprises in the industry.

The corporation has submittedproposals to the Government andcompetent authorities for reviewing,building and issuing legal documents,planning and amending policies relat-ed to maritime activities such as theResolution 29/2009/ND-CP datedMarch 26, 2009 on registration, pur-chase and sale of vessels, the Decree

09/2009/ND-CP dated May 2, 2009 thatpromulgates regulations on financialmanagement of State-owned compa-ny and management of State equityinvested in other enterprises, Circular18/2009/TT-BTC that instructs theimplementation of the 50 percent taxcut on value for imported goodsincluding ships; Circular 112/2009/TT-BTC providing value-added tax of 0percent on international shipping,draft decrees on the detained ships,ports management, etc.

Remarking on advantages and dis-advantages on the road ahead, MrDuong Chi Dung, President andGeneral Director of Vinalines, said:Continuing with achievementsattained during more than 10 years ofoperation, especially during the peakfrom 2006 to 2008 and premises creat-ed in 2009, the corporation has firmlyentered the so-called golden year,2010, with the belief that the countrywill victoriously complete the five-yearsocioeconomic development plan2005-2010.n

Luu Hiep


Happy New Year2010

ding Chances in Crisis

ENTERPRISES


Could you please tell the encour-aging achievements of NBC in 2009?

In 2009, we were still greatly affectedthe global economic crisis. Therefore,each enterprise had to determine its owndirection to sustain and develop. NBCsoon knew and quickly introduced prop-er measures and objectives to suit thenew condition. Especially, as regardsexport market, NBC determined marketconditions to apply timely measures. Forexample, we anticipated that the US mar-ket would meet with many difficultiesand risks; so we restructured sales, eitherraised or lowered, to this market in specif-ic periods of time in relation to Europeanand Japanese markets.

NBC managed to stabilise its produc-tion output, continue to promote invest-ment to create prerequisites for the accel-erating development of NBC after the cri-sis is over. Respecting production, wealways regard human resources as thefoundation for development; thus, ourleaders attach much importance toensuring that spiritual and material life ofemployees, especially in the time of priceescalation. Besides, we review all stagesof production and business activities toimprove efficiency and enhance produc-tivity.

In the past two years, NBC has soldnew products and brands onto theVietnamese market. NBC’s increasingpresence on the domestic market is notresulted from shrinking export marketsbut it is in the corporation’s strategy cre-ated 5-10 years ago. We has promotedand improved an overall picture of thecorporation as well the image of sec-ondary brands. NBC combines western

modernity and Vietnamese tradition in itscostumes. We understand that it is rightto strongly develop domestic market dur-ing this period but it also requires long-term investment. Because fashion cannotbe perfect immediately when it make adebut on the market, we must listen tocustomers and adapt social trends to pro-duce perfect products for customers.

NBC has officially announced thenew brand and brand identity sys-tem. What does this change mean?

After Vietnam joined the WTO andpledged to open its market to the world,NBC was aware of the importance ofrapid integration into the regional andinternational economies. Hence, sincelate 2008, after receiving the corporatemodel transformation permit from theVietnam National Textile and GarmentGroup (Vinatex), the Ministry of Industryand Trade, the Ministry of Planning andInvestment, the Prime Minister and theHo Chi Minh City Department of Planningand Investment, NBC signed a contractwith a professional design company toproceed with building the branding stan-dard to be registered and protected glob-ally. This is one of important plans in theroadmap we created years ago. In fact,we do not make much change to my olddiamond-shaped logo, only replacing"NB" with "NBC" which stands for Nha BeCorporation. NBC logo is created in hand-writing style where two letters, N and B,are bonded together to reflect the soli-darity, stability, activeness and moderni-ty. The theme colour, green, is keptunchanged, carrying the meaning of faithand optimism. The red upward stoke at

Nha Be GarmentJoint StockCorporation (NBC)has made signifi-cant contributionsto the success of theVietnamese gar-ment and textileindustry. In 2009,the corporation’sexport turnoverreached US$240million, a rise of 17percent from 2008,its total revenuewas VND1,880 bil-lion and payroll foremployees climbed12 percent. VietnamBusiness Forum hasan interview withMr Pham PhuCuong, DeputyDirector of NBC, onthe successes ofNBC.

NBC Sewing to New High


Happy New Year2010

letter ‘B” symbolises the rising, successand prosperity.

NBC hopes that the change in thebrand identity system will help the cor-poration to be more perfect, not losingits beloved image we have sowndeeply in the heart of customers. Thechange has shown the higher stature ofthe corporation and the desire to movetoward the world of Nha Be GarmentCorporation, a leading garment com-pany in Vietnam. This is reflected in thecorporation’s slogan: Reach to theworld.

So, what has NBC done to pre-pare for this major turning pointand what will it do to deepen NBCbrand into the mind of customers?

As mentioned above, the change inthe NBC logo is part of the corpora-tion’s development roadmap.Therefore, when the corporation metic-ulously prepared for the officialannounced of this change. From the

beginning, NBC determined to focuson export first and the corporation con-ducted studies and surveys on tech-nologies in developed countries whichare centuries ahead of Vietnam in fash-ion. In addition, we have procuredmodern equipment to scale up produc-tion to meet the increasing demand ofcustomers. An indispensable and deci-sive factor of fashion is design. We alsocooperated with several Italian design-ers and world-acclaimed designers tocreate products of both European styleand Vietnamese culture and character.From the above factors, NBC has pro-vided top quality, fashionable andtrendy products for the market.

When NBC makes inroads into thedomestic market, it has determined toprepare a strong enough financialresource to be a dominant. The fashionindustry cannot make a swift success ascustomers need time to use and feelnew products and they will form thetrend. We have launched high quality

products onto the Vietnamese marketwith the new NBC logo. After that, wehave conducted preliminary surveysand found out that NBC products havedrawn deep interest of customersthanks to its product quality and suit-ability to Vietnamese character and cli-mate, especially reasonable prices.

To maintain good and sustainabledevelopment, in the coming time, NBCis still consolidating and expandingexport markets and strengthening thedomestic market to increase the popu-larity of NBC brand. We will continue toinvest in more modern technologiesthan other companies and enterprisesin Ho Chi Minh City to step into highergrade products. In addition, we willincrease investments in factories manyprovinces and cities in the country toboost good production capacity andgrasp new opportunities when theeconomy recovers completely.

Thank you very much!Reported by Quang Dai

n the first days of 2010, VietnamBusiness Forum had the talk withMr Le Nam Vang, Chairman and

CEO of Nam Vang Joint StockCompany, to provide more informationabout the way to success of the compa-ny. On that way is paved by thestrength of unity and determination ofa team which is build on the nucleus ofGeneral Director Le Nam Vang - adynamic, creative, enterprising busi-ness leader, on highly skilled andenthusiastic staffs, on investments insynchronous equipment and produc-tion lines to manufacture international-ly recognised high-quality specialisedsteel products, and on many other fac-tors. All these elements have helped

“Nam Vang steel brand” to create asolid reputation in the Vietnamesesteel industry and become a reliablecompanion of big Vietnamese andinternational companies.

Hallmarks on national key projects

The steel industry is heavily affect-ed by the global economic crisis.However, Nam Vang Joint StockCompany withstood all challenges toboost sales to VND2,300 billion thanksto its good stockpile, popular reputa-tion in the eyes of banks and interna-tional suppliers. That impressive figurenot only helps the company achievegood profit but also, more importantly,

ENTERPRISES


N A M V A N G J S CReliable for All Construction Works

Fifteen years since itsestablishment, NamVang Joint StockCompany has continu-ously risen from a smallbusiness to a top-tierindustrial steel producerand distributor inVietnam.

VCCI President Vu Tien Loc presents Cultured Entrepreneur Golden Cup to CEO Le Nam Vang

ensures stable employment andincome for hundreds of workers.

That success is attributed to thecompany’s knowledge of marketdevelopment, production coeffi-cients, and price trends. Thus, thecompany can introduce highlyeffective policies from time to time.Especially, Nam Vang has created amajor difference in primary prod-ucts from its peers, mainly focusingon steel for heavy industries andpre-engineered steelworks. Hence,the company has won the trust ofbig customers, suppliers, banks anddistributors across the nation.

Mr Vang said: “Since my compa-ny was founded, I thoroughlyunderstand that to be successfuland to become a prestigious brandin the market, we must build onthree main factors: Product quality -wholehearted service - clear pay-ment”

At present, Nam Vang hasalready become the most reputedbrand in the industrial steel indus-try. Its typical customers are leadingcompanies in Vietnam likeInfrastructure Development andConstruction Corporation (Licogi)and Vietnam Shipbuilding IndustryCorporation (Vinashin). Proudly,Nam Vang steel has been used infamous national key projects likeBai Chay bridge, Thanh Tri bridge,Phu Dong bridge, Vinh Tuy bridge,Nhat Tan bridge, Son La hydropow-er plant, Pha Lai thermal powerplant and many other famousworks.

In the light of its operating phi-losophy of “Live together - developtogether”, Nam Vang Joint StockCompany has continuouslyexpanded its scale by setting upmany new units like Nam Vang HaiPhong Branch in Haiphong city,Nam Hong Steel Trading Centre inThanh Tri district, Hanoi city and HoChi Minh City Branch in HCM Cityand electromechanical workshop inHanoi.

Expanding market

In the coming time, althoughthe aftermath of global financial cri-

sis continues to drag on businessactivities and the presence of newbig steel projects (joint ventureswith South Korea, Taiwan, China,etc.) will create the fiercer competi-tion on the domestic steel market,Nam Vang Joint Stock Company iscompletely confident to advance asit has invested in modern machin-ery and equipment to manufactureits own products, not only sellingraw materials. At the same time,together with the continuedstrengthening of its prestige brand,the company is promoting to joinhands with potential partners toexpand operations into other areassuch as construction material pro-duction (sand, stone, gravel,cement and bricks) and real estateconstruction and trading.

As regards international mar-kets, Mr Vang said his company isnow interested in markets in Laosand Cambodia as they are close toVietnam, which will help the com-pany trim transportation costs andwhere the requirements for productquality and selling prices are nottoo high and production capacity ofpeer companies in these marketshave not developed. In addition,the two countries have rich naturalresources and the company cancooperate with local companies toexpand production.

To recognise the maturity andcontribution of Nam Vang JointStock Company to the nationaleconomy, the Ministry of Industryand Trade rated Nam Vang as the“Top 100 Best VietnamCompanies in 2007”. Onlinenewswire VietNamNet andVietnam Credit Ratings JointStock Company ranked NamVang 35th in terms of assets and149th in terms of profit on the“Top 500 Private Companies inVietnam” list. Nam Vang hon-ourably won the “Integrating andDeveloping Company” Award in2008 and “Cultured Company -Unesco Vietnam 2009” title. Mr LeNam Vang personally won the“Cultured Entrepreneur 2009”title.n

D. Son – Ng. San


Happy New Year2010

Malaysia and for its partners in China,Indonesia, Thailand and other localities. Inthe coming time, PTSC will follow up theplan of the Vietnam National Oil and GasGroup (PetroVietnam) to provide oil andgas services in Russia, Venezuela andCuba.

What is the key element to assertthe position of PTSC?

PTSC is a proud to be a member unit ofthe Vietnam National Oil and Gas Groupand this is an advantage in addition todeveloping the PTSC brand on interna-tional markets, featuring a strong, dynamicand enterprising workforce and solidarityand ambitious traditions. The product andservice quality is the measure of the suc-cess at PTSC, which is praised by domesticand international customers. Presently,PTSC is applying a total of 89 standards col-lected in the US, the UK, the EU and devel-oped nations to its process of providingservices to customers. PTSC is one of thesoonest units to successfully build andapply ISO 9001, ISM Code, OSAH 18001and ISO 14001 international standards andvideo conference systems at the head-quarters and member companies.

In 2009, despite numerous difficultiesand challenges arising from the globaleconomic crisis, with its focus on promot-ing advantages and gathering brainpow-er of its staffs, PTSC managed to bring theannual revenue to VND12,606 billion, 23percent higher than the full-year plan and28 percent higher than the same period ofthe previous year, and the pre-tax profit toVND638.7 billion, equal to 133 percent ofthe yearly plan and 117 percent from ayear ago. The average monthly income ofa staff is VND12 million.

Tochieve these results, in addition topromoting the traditional services, PTSC isfocusing on developing its strengths,building and developing new potentialtechnical services, especially O&M. This isthe general service of various technicalservices in order to meet requirements ofinvestors in operating and exploitingassets effectively and professionally andsuit the integration trend and the oil andgas industry development in the future. n

Thank you very much!Reported by Van Luong

(from P.27)

? PHAN THANH

hile exports of pangasius, ortra catfish, to European andUS markets slumped, the

shipments to Russia rose from 5 percentto 7 percent over 2008, especially in thelast months of 2009. This is a repay toefforts of Vietnamese fisheries sector inthe market finding and developing strate-gy.

Only from May to November 2009,Vietnam exported nearly 40,000 tonnes ofaquatic products worth over US$80 mil-lion to the Russian market, of which morethan 39,000 tonnes of tra catfish valued atUS$64 million. Exporting prices forRussian are higher than other Europeancountries by 15-20 percent and no ship-ments broke quality regulations.Vietnamese seafood exporters expect toship 50,000-60,000 tonnes of tra catfish tothis market in 2010. Besides, shrimp

export is also hoped to accelerate.“In fact, Russians do not know much

about Vietnamese tra catfish but we willstrive to make the tra catfish a popularfood in Russia,” said Duong Ngoc Minh,who is in charge of exporting aquaticproducts to Russia and is the GeneralDirector of Hung Vuong Corporation (HVCorporation). Minh said his export toRussia management board plans to intro-duce the images of tra fish in Russian andother CIS countries from the process offarming to processing through the massmedia in Russia.

With the capacity of the country’slargest exporter of catfish like HungVuong, exporting large volumes to Russiais within reach. HV Corporation is current-ly managing 160 hectares of water sur-face for aquaculture, capable of meeting60 percent of material demand of thecompany.

Hung Vuong now has seven seafoodprocessing plants with a capacity of100,000 tonnes per year and a freezingfacility with a capacity of 42,000 tonnes inTan Tao Industrial Park. In 2010, the com-pany plans to increase investment andmerge subsidiaries in order to upgradeproduction capacity. Particularly, it raisedthe charter capital of Tay Nam Cultivationand Feed Joint Stock Company toVND200 billion in which Hung VuongCorp will hold 55 percent of the stake. Itwill also merge Vinh Loi SeafoodProcessing Joint Stock Company and TacVan Seafood Exporting Joint StockCompany in 2010 to bring a combinedrevenue to VND2,000 billion. The corpora-tion will put Hiep Phuoc-Nha Be cold stor-age facility into operation with expectedannual revenues of VND180 billion on 50percent of the operating capacity.

With its advantages in complete pro-duction model and large operating scale,Hung Vuong made a net profit of VND350billion in 2009 and expected at VND8,000billion of revenues in 2011.

Mr Minh said, in addition to Vietnam,Thailand also made no less effort toincrease export of catfish to the Russianmarket. Russians are very keen on aquaticproducts, especially tra and basa catfish.And, after penetrating into the Russiamarket, Vietnam will easily approach sur-rounding CIS markets like Ukraine andGeorgia. n

ENTERPRISES


HUNG VUONGPopularising Tra Catfishin Russia

The year 2009 was a dif-ficult period for theseafood industry ofVietnam. The exportturnover is estimated toreach US$4.2 billion,down about 0.7 percentfrom 2008, or a drop ofUS$300 million.However, Hung VuongCorporation has madegreat efforts to maintaintraditional markets, seekand develop new mar-kets, stabilise the quali-ty, diversify designs andinvest in materialsources systematically.


Happy New Year2010

ENTERPRISES


DOMESTIC MARKET Not a Temporary Shelter

In spite of numerous difficulties in the first months of 2009 arisingfrom the global market, with rational steps Vietnamese importers and

exporters, including Hanoi Trade Corporation (Hapro), still maderesounding successes. The corporation’s revenue reached VND5,900

billion in 2009 while average incomes rose 20 percent from 2008.The leaders of Hapro assumed that Vietnamese exporters were turning

their back to the home market and that was a big blunder. Vietnam,identified as a potential market with a population of more than 86 mil-

lion people, is a target and sustainable market in long-term develop-ment strategy of any company. Thus, for years, Hapro has adopted

sound policies to approach and conquer the domestic market.

“The Vietnamese prioritize Vietnamese goods”campaign launched by Hapro

? LE HIEN

Attraction of domestic market

Mr Tran Manh Canh, Deputy GeneralDirector of Hapro, said, in 2009, Vietnamachieved an economic growth of 5 percentand the domestic market played a decisiverole. Therefore, to occupy the home mar-ket, companies need to know the demand,methods and conditions of domestic con-sumers. For example, high-income earnersin the domestic market only care about thequality, not the price. Medium-incomeearners, who mainly live in cities, have avery high demand for good quality goods.And low-income earners, who normallylive in rural areas, put the price at the top oftheir priorities.

With its market understanding, Haprohas applied sound business strategies toincrease sales while export markets weredownsizing. The domestic sales in 2009increased dramatically in comparison withprevious years. With a lot of member com-panies like Hanoi Supermarket Company(Hapromart), Hanoi Food Company(HaproFood) and Hanoi Fashion Serviceand Trading Company (Hafasco) and con-venience stores spread out in urban, resi-dential and commercial centres, Hapro hasgradually brought its products to con-sumers, ranging from common ingredi-ents for daily meals like rice, meat, eggsand vegetables to Hapro-branded clothes.The Hapro presence is spreading thanks tohigh quality and competitive price.

Hapro along with other brands like VietTien, Nha Be and Saigon Co-op are glorify-ing the picture of domestic consumption.Instead of only focusing on exportation,the corporation has paid more attention tothe domestic market and Vietnamese con-sumers can use made-in-Vietnam goods ofworld-class quality. The approach is also inline with the Government-initiated “BuyVietnamese” campaign aiming to per-suade Vietnamese consumers to buyVietnamese goods.

To expand its domestic presence,Hapro has joined many consumer stimuluscampaigns launched by the Government,including the sale month programme inHanoi in 2009 with more than 1,000 salepoints. During the promotion month,Hapro launched the “more promotion,more buys” at its 54 sales points in Hanoi.Most Hapro units had carefully prepared

for the participation in the programme intheir own fashion.

According to incomplete statistics, rev-enues from the sales promotion monthamounted to VND500 billion, reflectingthe high demand in the Vietnamese mar-ket. In addition, Hapro carried out salesprogrammes in rural areas. After twomonths of implementing the demandstimulation programme for rural areas,Hapro units made 20 countryside sellingtrips in outlying districts of Hanoi andachieved a better-than-estimated result ofover VND2.5 billion.

Support policies needed

Mr Canh said: “Many lessons have beendrawn from sales programmes. To makesuccess, even in rural markets, enterprisesmust carefully study the structure and cat-egories of goods. Specifically, goods sold inrural areas need to suit the needs, livingstandards and consumption habits in dif-ferent regions and localities. The durationfor selling goods must last at least two orthree days.

According to economic experts,Vietnamese consumers are familiar withtrading at marketplaces (accounting for 45percent of the goods in circulation).Although Vietnam has enacted many poli-cies to support the domestic market devel-opment, it still lacks policies to build up themarket. To expand domestic trade, theMinistry of Industry and Trade has submit-ted to the Government a draft decree onmarket development to address weakpoints of market construction in majorcities. The draft regulation will provideinvestment supports like land rental, loca-tion, corporate income tax and soft loan todevelop retail markets, wholesale marketsand modern shopping centres. Theupcoming policy will also focus on regulat-ing the circulation of essential commodi-ties like steel, fertilisers, petroleum and rice.

Mr Canh said, when more businessesreturn to the domestic market, they needto understand that the domestic market isnot a momentary shelter. They need toboost exports and expand their presencein the home market to assert their capacity.By this way, Hapro, a major exporter withclose relations with more than 60 coun-tries, still achieved the annual planalthough export markets shrank in 2009.n


Happy New Year2010

because people would contactmore. Therefore, Viettel decidedto invest to expand the network,improve the service quality andmeet the growing needs of cus-tomers.

What is the most promi-nent feature at Viettel in2009?

In 2009, in addition to thesuccess in riding out economicrecession and sustaining robustgrowth, the opening of Viettel’scompanies in Laos andCambodia was the most note-worthy as it marked a milestonein entering global markets.Besides, last year, Viettel wasinternationally hailed andrecognised for its global marketsolutions.

Viettel will continue consid-ering investments in 3-5 coun-tries in Asia, Africa and LatinAmerica and will launch servicesin at least one country.

What is your remark onthe significance of the forma-tion of Viettel Group?

This is the assessment andrecognition of the Party and theState to Viettel’s contributions,marking a new developmentstature of Viettel. In the ICTindustry, there are two econom-ic groups, namely VNPT andViettel. This is the only industryto have two economic groupsand this proves the importanceof ICT industry and the determi-nation of Vietnam to become anICT powerhouse with an annualgrowth of 25 percent from nowto 2015, about four times higherthan the growth of GDP. Viettelwill be one of the most impor-tant forces in this acceleratingstrategy.

Thank you very much!Reported by Do Son

(from P.45)

ENTERPRISES


? ANH DAO

he Vietnam InternationalFurniture & Home AccessoriesFair 2010 (VIFA 2010) is sched-

uled to be opened at the SaigonExhibition and Convention Centre(SECC) at 799 Nguyen Van LinhBoulevard, District 7, Ho Chi Minh Cityfrom March 11 to 14, 2010 by theHandicraft And Wood IndustryAssociation of Ho Chi Minh City (HAWA).In addition to wooden furniture items,this year's event will also introducemachinery, tools, equipment and spareparts for production and processing of

wooden products and quality controlservices.

According to HAWA, VIFA 2010 willbe supported by an effective and large-scale trade promotion programme. Thetotal marketing expenditure for VIFA2010 amounts to over US$180,000 andmore than 40 domestic and foreigncommunication companies will takepart. Especially, the close relationshipwith embassies and State-owned tradepromotion organizations with regionaltrade fairs will help send the informationabout VIFA 2010 to companies aroundthe world. Taking part in VIFA 2010,exhibitors will have the opportunity tocontact and expand cooperation withthousands of new customers with thehigh spirit of business cooperation formutual development. This is an oppor-tunity for the Vietnamese wood industryto develop potential customer data fromwhich enterprises can pick the best part-ners, gradually develop business activi-ties and increase brand values.

Besides, according to the ASEANFurniture Industries Council (AFIC), VIFA2010 will officially join the InternationalFurniture and Interior Decoration TradeFair of six AFIC member countries,including Indonesia, Malaysia, Thailand,Singapore, the Philippines and Vietnam.

VIFA 2010Promoting Export Even on Home Market

Vietnamese woodwork producers may find lots of export opportunities at VIFA 2010

? NGOC HIEN

y measuring the busi-ness efficiency on pres-tige and quality, Le

Thanh Trade and ConstructionCo., Ltd, located in Binh Tan dis-trict, is gaining the trust of morecustomers.

Since its establishment, withmany efforts for innovation andperfection the company hasasserted its service quality andbecome a reliable and effectiveconstruction contractor. Theadvantage of the company is astrong force of well-trained,professional, enthusiastic, cre-ative architects and engineers,richly experienced and capablemanagers and highly skilledtechnical workers.

Apart from being a construc-tion contractor, the companyalso expands into real estateinvestment and trading, mainlyin housing development. Theprimary factor leading to thesuccess of Le Thanh in all pro-jects is the style of manage-ment. The Management Boardalways pays due attention tothe quality of all works.Moreover, Le Thanh harmo-niously combines its own pres-tige and the prestige of its part-ners to create the strength andfoundation for sustainabledevelopment of the company.This is also reflected by thechoice of distribution channelfor its property products. Thecompany’s products are offered

at ACB real estate trading floorwhere all products are carefullyexamined for the legality andquality by ACB specialists.

Knowing that some cus-tomers want to own secondresort homes in Da Lat City, thecompany decided to build a 4-star hotel apartment complex inthis famous tourist city. Thehotel has 123 rooms equippedwith modern facilities and thecompany will sell serviced hotelrooms to customers. With thepink ownership certificates,they can transfer the propertyto their offspring. Every year,customers will be served withfour-star services at their sec-ond homes during their stayhere. When the holiday is over,the hotel management boardwill rent these rooms. The rentalwill be shared between theowners and the operators. Thisform of cooperation betweeninvestors and customers isaimed to maximise the capacityof the property. When ownersare absent, hotel rooms are stillprotected carefully by the hotelmanagement board. Clearly,when customers buy thesehotel rooms, they are share-holders of Le Thanh Company.

With its capacity, modernequipment and accumulatedexperience, Le Thanh gatherssufficient conditions necessaryto construct buildings meetingall requirements for technique,aesthetics and utility. n

LE THANH CO., LTDAffirming Prestige & Quality

The joining in the AFIC fair chainwill bring many benefits to thewood industries of the membercountries. Through the chain of theinternational furniture fair, VIFA2010 will be advertised widely byAFIC to its customers and theworld’s largest importers like theUS, Japan and European countries.The time for trade fairs in AFICmember countries has been agreedto take place from March 2 to March14, 2010. Accordingly, the exhibi-tion chain will create favourableconditions for international pur-chasers to attend many organisingcountries in the region. In additionto attending the AFIC fair chain,HAWA members can also partici-pate in other concurrent events likeSingapore International FurnitureFair (IFFS) and ASEAN Furniture Fair(AFS) 2010 in Singapore from March9 to 12, 2010

Commenting on VIFA 2010, MrHuynh Van Hanh, Vice Chairman ofHAWA, said: “Besides traditionalmarkets, this fair will have morecustomers from new markets suchas Russian, Czech Republic, Algeria,South Africa, Canada, Mexico andthe Middle East. Export promotionis carried out in the home marketand finding out new markets is thesuccess of Vietnam's wood industry,especially in the current difficultcontext.”

“Prior to VIFA 2009, I had heardthat trade fairs in Vietnam weresmall and lack new designs andquality. However, when I witnessedthis trade fair, my knowledge wascompletely different. VIFA 2009really is a professional fair in allaspects and has a wide range ofproducts in very nice designs. I amvery impressed with your fair,” saidthe editor-in-chief of famous furni-ture journal, MoebleMarkt, inGermany about the success of VIFA2009.

With many efforts to supportwood and handicraft enterprises inVietnam, VIFA 2010 is expected tobe an important bridge forVietnamese companies to resumeand increase exports and search forimporters in new markets.n


Happy New Year2010

ENTERPRISES


MARITIME BANKC o m p r e h e n s i v e G r o w t h

Vietnam Business Forum has aninterview with Mr Tran Anh Tuan,General Director of MaritimeBank, on its business results lastyear and development plans forthe coming time.

The announcement of the insurance policy signed byMaritime Bank and Prudential

2009 is considered a challeng-ing year to the health of busi-nesses but the global financialcrisis seems not to impactMaritime Bank?

2009 is a challenging year for thedomestic and regional economies asglobal financial crisis wreaked onbusinesses and banks. However,with a more than 18 years of experi-ence, Maritime had a year of suc-cessful business. The crisis did notimpact much on our bank’s opera-tions. We have gained the positivegrowths in all aspects.

What is the secret of MaritimeBank?

In my opinion, the secret toescape hardships is, first and fore-most, the right and complete aware-ness of difficulties before introduc-ing response measures and actions.Banks need to build a comprehen-sive risk prevention mechanism,especially market risks. In addition,banks have to focus on diversifyingactivities, not only taking care ofcredit but also increasing servicerevenues - the risk will be lower.Besides, lenders can expand rela-tionships with partners to diversifyproducts and services.

Maritime Bank, in addition to itsfocus on good risk management andliquidity, always coordinates withcustomers, especially traditionalcustomers to withstand the crisis.Moreover, we attach much impor-tance to customer approach andcare activities in order to introducenew products and improve servicesfor corporate and personal cus-tomers.

Our efforts have been repaid. Infact, Maritime Bank made better-than-estimated profit in the firstmonths of 2009 when impacts of thecrisis strengthened. We managed tokeep the stable growth until the endof 2009.

Difficulty is supposedly theopportunity to assert marketpositions. What do you thinkabout this viewpoint?

I totally agree with this point of

view. In the course of constructionand development, we have encoun-tered numerous difficulties, but withour effort, we managed to livethrough to show off our capacity.

Would you mind revealingyour upcoming plans?

We will continue to diversify ourproducts and services, improve ser-vice quality, and implement flexiblelending programmes, pay moreattention to smallholding corporatecustomers to introduce appropriatepolicies.

Regarding corporate customers,in the upcoming time, we will contin-ue to provide short-term, medium-term and long-term credits in a time-ly manner for businesses to expandproduction and business. Aside fromtraditional credit products, MaritimeBank will design products for specificgroups of customers and supply cap-ital for production and businessactivities through other channels likefactoring and corporate bonds. Wealso promote package banking ser-vices for corporate customers involv-ing importing and exporting and paymore attention to smallholding busi-nesses.

The economy is expected torecover in 2010. What is yourforecast about the market trend?

I think, following the recoverymomentum in 2009, Vietnam’s econ-omy will continue to grow, fuelledby the domestic market expansion,flexible exchange rate to spur exportand reduce trade deficit. However, Ido not exclude the possibility thatinflation may return.

The economic growth is fore-cast at 6.5 percent next year, exportwill rise 6 percent, and consumerprice index (CPI) will be capped at 7percent. In 2010, Vietnam will focuson accelerating the solid recovery,pay attention to growth quality,maintain macroeconomic stabilityand prevent the return of highinflation.

Thank you very much!Reported by Luu Hiep


Happy New Year2010

In 2009, theprofit ofMaritime BankreachedVND1,084 bil-lion while thetotal assets val-ued at nearlyVND65 trillionas of December31. In 2010, ItexpectsVND1,000 bil-lion of profit,VND100 trillionof assets andVND4,000 bil-lion of char-tered capital.

REAL ESTATE


BOND ISSUINGEffective Fundraising for Real Estate Developers

The very sudden volatility of the market, either toohot or too cold and the move to tighten the lendingfor real estate in 2009 opened the opportunity forreal estate developers to seek out their own ways.Many companies successfully raised funds for theirprojects by issuing corporate bonds.

? LUONG TUAN

his fact proved the effectiveness ofthis new fundraising channel whiletraditional channels are hard to

access. This is also considered a new way forreal estate business companies in 2010.

No way to banks

In the first half of 2009, tightened mone-tary policies forced many real estate compa-nies to scale down their activities. When theUS$7 billion stimulus package was launchedby the government, several property devel-opers received supports and the marketstarted to revive. According to ProfessorDang Hung Vo, former Deputy Minister ofNatural Resources and Environment, in2009, the housing and land markets werevery volatile primarily due to insufficient cap-ital of investors. Without enough money,many investors decided to raise funds fromother partners by offering business coopera-tion contracts or capital-sharing deals.However, this caused adverse corollaries tothe market and the society.

Meanwhile, the costly lessons of theglobal financial crisis rooted from the prop-erty market in the United States forced theState Bank to require commercial banks tobe more cautious in financing real estate;and, as a result, many businesses did nothave enough money for their projects. Forthat reason, at the end of 2009, propertyloans in Ho Chi Minh City was estimated atVND70 trillion, accounting for about 15 per-cent of the total outstanding loans in thecity, while banks in Hanoi lent VND32 trillion,equal to nearly 10 percent of total outstand-ing loans. At the beginning of January 2010,the property lending has no major changesin the wake of capital shortage. Even, bankslacked medium and long-term capital.

Excessive price of real estate forcedbanks to limit loans for real estate projectsfor fear of bubble. But, according to Dr LeXuan Nghia, Vice President of the NationalFinancial Supervisory Commission (NFSC),based on the current context, there is no fearof real estate bubble. Because Vietnam doesnot “securitize” real estate debts, there is noimpact of the property market on the invest-ment sector and on the banks as well.Therefore, the secondary risk of real estatelending is not high. Furthermore, Vietnam

only has the first-time bad debt; hence, it canhandle with it more easily. In the meantime,commercial banks are still very cautious withloans for property projects. With the samepoint of view, Professor Dang Hung Voadded there was no ground for the forma-tion of real estate “bubble” in 2009. In fact,there were only local waves, he added. In2010, there is no need to worry about this.

Raising capital from bond issuance

Market developments in 2009 showedthat capital for the real estate market was asensitive issue and this will surely continue in2010. Nonetheless, Vietnamese real estatecompanies are currently based on only threemain sources of capital: owner’s equity, bankloan and customer loan, but they sometimeshardly access any of these. In recent years,due to the heavy dependence on the threeaforementioned sources, the property mar-ket always falls short of capital. Moreover,according to Mr Ken Atkinson, ManagingDirector of Grant Thornton, a professionalauditing and consulting company, while theowner’s equity is not strong enough andbanks refuse to lend, the fundraising in theform of capital-sharing contract is not attrac-tive to foreign investors and even overseasVietnamese investors as local investors stillhold the advantage while capital contribu-tors are exposed to more risk. This reality stillexists in Vietnam many years and has is apublic annoyance.

In 2009, many real estate developerssuccessfully raised funds for their projects byissuing corporate bonds - a new channel.Song Da Finance Joint Stock Companytogether with Song Da Thang Long JointStock Company sold VND300 billion worthof bonds to finance the expanded Van Khenew urban zone. Also in October, Financeand Business Development Joint StockCompany (FBS) also sold out 300,000 bondswith a face value of VND1 million per bondand with a maturity of three years to fundurban projects in the west of Hanoi. OnNovember 30, 2009, Novaland Real EstateInvestment Joint Stock Company also suc-cessfully issued VND1,922 billion worth of 5-year bonds with a coupon rate of 12 percentper annum to implement the Sunrise Citycommercial and apartment complex.

In fact, several real estate companiesstarted mobilizing capital by issuing bondssince the start of 2008 when they wereunable to borrow large amount of capital.

For instance, Sai Gon Thuong Tin Real EstateJoint Stock Company (Sacomreal), a pioneerin seeking for a new source of capital forproperty projects, issued VND100 billion ofsix-month bonds, with a par value ofVND500 million, in January 2008.Bondholders were given the priority to buyapartments at a discount of 5 percent of theapartment value in addition to a coupon rateof 8.8 percent per annum. Mr Bui Tien Thang,Deputy Director of Sacomreal, could notconceal his delight when Sacomreal suc-cessfully drew capital by securitizationmethod in spite of many doubts about theeffectiveness of this financial instrument.

According to financial experts, toincrease the attractiveness of real estatebonds, issuers should attach the right of buy-ing apartments to bondholders. Companiescan mobilize long-term capital from manydifferent investors such as investment funds,insurance companies, financial groups andothers by applying flexible coupon rate andprincipal payment although the coupon rateis possibly lower than the rate imposed bycommercial banks

Still locked

However, according to economicexperts, the property bond issue is gettingmore difficult because issuers must gathermany compulsory factors such as trade-marks, feasible projects and backing of cred-it institutions in order to mobilize capitalfrom the new channel successfully. On theother hand, if companies have no plans thatensure solid and attractive interest for bond-holders, they will be hardly successfulbecause property notes are riskier than bankbanks. The investor confidence depends onthe progress of property projects whileinvestors are more experienced in identify-ing unreal projects.

In addition, the highest constraint is astrict issuing condition. Thus, this channel isthe only playing ground for large-scaledcompanies. Sharing this viewpoint, DrNguyen Son, Director of MarketDevelopment Committee under the StateSecurities Commission of Vietnam (SSC),admitted that, to date, the State channel stilllacks financial products like “securitization”of property loans to list on the stock marketdue the absence of legal regulations. If thisproblem is unlocked, the capital mobilisa-tion of listed real estate companies is alsoeasy. n


Happy New Year2010

MARKET & PRICE


aining Stronger Footholdon Domestic MarketFor a long time, Vietnamese enterprises have activelybeen conquering foreign markets. It seems to be truethat the economy’s high growth over the past time isattributed to exports. Made in Vietnam High-qualitycommodities have become the pride of local enterpris-es as they have continuously competed against rivalsand gained the large market share outbound. Localenterprises used to be only interested in foreign mar-kets and letting foreign goods particularly those madein China overwhelm the domestic market.

G

? MINH CHAU

he global economic crisis hasnot only changed the world’economy, but also affected

every enterprise. During the pastyear, the domestic market with apopulation of more than 80 million, amajority of them are low-incomeconsumers, have saved export firmswhose revenues in foreign marketsfell sharply due to the crisis. In detail,the foreign direct investment (FDI)reduced 70 percent, the exportturnover decreased by 11 percent,but the domestic market’s retail salesand services increased by 18.5 per-cent. The domestic market obviouslyplays an important role. If each con-sumer increased his/her spending byVND15,000-VND20,000 monthly, thewhole country’s spending in 2009would have increased by VND16 tril-lion-VND17 trillion. The figure is verysignificant because it compensatesthe economic fall over the past.

The market is always true andsensitive. Catching up with themove, some big enterprises produc-ing key export items have quicklycome back to the domestic marketwith a long-term investment strategyinstead of considering it just a tem-porary shelter against the crisisstorm. The first firms having focusedon the domestic market and initiallygot achievements are Viet Tien, NhaBe, Garment 10 or the An Giangseafood export company, SaigonCo.op. As the export markets werenarrowed, the above-mentionedexporters have been willing toreduce selling prices and promotesales in crowded residential areaswhich had been ignored in the past.By doing that, their domestic marketshare increased quickly. TheVinatex’s chain of Vinatex Martsupermarkets has reported a 24 per-cent growth in revenue against 2008despite difficulties from the globaleconomic downturn. Currently,Vinatex has developed 54 supermar-kets and shops nationwide, bringingin a sale revenue of VND1 trillionevery year.

Le Quoc An, Chairman of the

Vietnam Textile and GarmentAssociation (Vitas) said Vietnam’sapparel sector is efficient enough tooccupy the domestic market. In 2009,the apparel industry also took thelead in the country’s export itemswith a turnover of nearly US$9.2 bil-lion.

The question is which groups ofconsumers should be targeted. Forexample, the Viet Tien GarmentCompany has focused on high-income consumers to introduceproducts with prices betweenVND800,000 and VND 1 million perset and medium-income buyers tosell products that cost VND100,000-VND200,000. Viet Tien is planning toreach a growth of 40 percent at thedomestic market by introducing aseries of new products, particularlyready-made clothes for students andworkers. Apart from a network of 17shops and nearly 600 agents, VietTien is aiming to expand the distribu-tion system and bring its products to48 trade centres nationwide.

Another firm having succeeded inits way to occupy the domestic mar-ket is the Thuong Dinh shoes compa-ny. While other shoes makers areabsorbed in seeking export orders,Thuong Dinh had kept a firm andlarge market share at homeland. Thecompany’s products are present any-where from plains to mountains,from the countryside to urban areas.As export orders were reduced, theThuong Dinh Company decreasedproduction costs and raised thelocalization rate to 95 percent.Especially, a distribution network of250 agents nationwide has helped tobring the company’s products toconsumers more quickly. Thus, thecompany’s domestic revenues in2009 increased 20 percent from ayear earlier despite the exportturnover being down 25 percent.

The woodwork sector hasplanned to occupy the domesticmarket in 2010. The Vietnam Timberand Forest Products Association hasmade a survey on the demand ofwoodworks in Hanoi, Ho Chi MinhCity, Haiphong and Danang. Themarket share of desk and chairs forschools in the entire country is

almost ignored by domestic firms.The association and its members areplanning to submit to the govern-ment a public purchasing scheme toprovide desks and chairs for allschools nationwide. Domesticproviders also are paying attentionto the market of interior woodworksfor buildings as areas for buildingsare forecast to continue increasing incoming years. Costs for interiorwoodworks in two-star hotels areVND12 million/room, in three-starhotels are VND18 million/room andfour-star hotels are VND24million/room. In addition, the surveyalso found the spending for wood-work in each household is approxi-mately VND3 million-VND6 millionannually. This is an impressive figure,which is enough to persuade anywoodwork processing firm that rev-enues from the domestic marketcould reach US$1 billion in 2010.

Since multinational giants arrivedin Vietnam and earned colossal prof-its, the Southeast Asian market hasbeen considered one among theworld’s most attractive retail mar-kets. This has made Vietnameseenterprises wake up and look at theirstrategy. Occupying any market,even the domestic market, is alwaysnot easy. It takes a long time to cre-ate belief, build trademarks, set upthe distribution channel, designmodels and balance costs for pro-duction. In addition, enterprisesneed to restructure their export aswell as production process. These aredifficult but vital.

In 2010, lots of firms expect toearn from the domestic market.However, from early this year theVietnamese retail market has alsobeen opened for foreign retailers.This is really a challenge facing notonly Vietnamese retailers but alsothe entire community of businesses.Although being quite late, thedomestic market is still a fertile land.There’s no place like home is a slo-gan which Vietnamese firms havebeen imbued with and they haveplanned carefully to occupy itinstead of considering it as a buoyamid the economic downturn. n


Happy New Year2010

? VU LONG

2009 year’s victory now just adream

Despite the global economic crisis,the Vietnamese auto market remainedsuccessful thanks to the Government’sdemand stimulus package includingthe reduction of 50 per cent of VAT,registration fees for ownership andpreferential interest rate of bank loansfor individuals’ car purchase.

The figures released by theVietnam Automobile Manufacturers’Association (VAMA) demonstratedthat in 2009 the sale volume of locallyassembled cars reached a record levelof nearly 120,000 units, an increase of6.7 per cent against the previous year.

Amongst them, Mercedes-BenzVietnam, Vietnam Motor Corporation,GM Daewoo VIDAMCO, Ford Vietnam,Vinastar (Mitsubishi) took the lead withthe increase sale growth of 60 per cent,50 per cent, 29 per cent, 28 per centand 25 per cent, respectively.

Toyota Innova model became thebest seller with the sale volume of8,475 units, followed by Toyota CorollaAltis (6,468 units), Toyota Fortuner(5,876 units), Toyota Vios (5,141 units)and Chevrolet Spark (4,603 units).

On the other hand, the GeneralStatistics Office of Vietnam’s estimatedfigures indicated that around 76,300brand-new and second hand carsunder the mode of Complete Built-upUnit (CBU) were imported in 2009 withthe total import value of US$1.171 bil-lion.

As such, the import volume andimport value of CBU increased by 50per cent and 13 per cent against 2008,respectively.

Scenarios for 2010

Dealing with the dramatic reduc-tion of car sale volume in the begin-ning of this year, a series of promotioncampaigns aimed at stimulating thepurchasing demand of consumershave been released by auto-makerssuch as Toyota, Ford, GM Daewoo, andMercedes Benz.

Toyota Motor Vietnam (TMV) justannounced its 2010 Spring Seasonal


AUTO-MAKERS Finding Way for Survivaland DevelopmentThe stagnant sale volume of automobiles on the domes-tic market in the beginning of this year was mainlyblamed on the lift of hefty tax preferences, which hasmade local auto-makers concerned about the unpre-dictable Vietnamese auto market this year.As of January 1st, 2010, value added tax (VAT) increasedagain by 50 per cent up to 10 per cent; whilst registra-tion fees for ownership on cars rose again by 50 per centup to 10 per cent in Hanoi and 12 per cent in other citiesand provinces. Similarly, preferential interest rate of bank loans at fourper cent for individuals to purchase cars was lifted byDecember 31, 2009. It is more difficult for the auto mar-ket because the ceiling forex rate has been adjusted toincrease at VND18,500(US$1).Such moves have brought in dark clouds over the posi-tive outcomes of the automobile market achieved lastyear. The industry source indicated that a very smallnumber of cars have been sold out at most of the localauto-makers this year.

GM Daewoo is among the auto makers with the largest sale volume in 2009

Promotion Program, which willbegin this February.

Accordingly, all of its customersreceiving cars within the periodfrom February 17 to March 31,2010 will receive one year of physi-cal insurance of car body amount-ing to the equivalent of 1.56 percent of a listing retail price (exclu-sive of VAT).

Ford Vietnam on the otherhand maintains its retail price onEverest, Transit and Mondeo mod-els until the end of the first quarterthis year.

Mercedes Benz Vietnam (MBV)maintains its retail price on variouscars until this March 1st, 2010 toentice its customers for the Tet fes-tival.

GM Daewoo VIDAMCO hasdone the same.

Experts say the above-men-tioned promotion schemes are justshort-term solutions. So the automarket this year will still be unpre-dictable. Seemingly, the develop-ments of the auto market early thisyear is quite similar to what hap-pened during the same period lastyear. Just after the first five monthslast year when the Government’stax preferences took effect, thelocal auto market flourished.

Some opinions expect once thesale volume of automobile reducesdramatically, resulting in a reduc-tion of tax contribution to the StateBudget, the Government will con-tinue once again to have necessarysupport for the local auto-makers.

Though, local auto-makershave seen light at the end of tun-nel. Some auto-makers are racingagainst time to launch strategic carmodels to attract customers. Theper capita income of theVietnamese is improving, therebyleading to the purchasing power ofcars for transport.

Furthermore, the existingrecovery of global economic mar-ket will have positive impacts onthe Vietnam macro-economicdevelopment in general and thelocal auto market in particular.

Auto-makers are still dreamingof fruitful achievements of sale


Happy New Year2010

Sale volume of 16 auto-makers as VAMA’smembers in 2009 and 2008

No. Auto-makers 2009 year (units) 2008 year (units) Increase (%)1 Mercedes-Benz 3,399 2,118 60%2 VMC 784 522 50%3 GM Daewoo 14,200 11,036 29%4 Ford 8,286 6,473 28%5 Vinastar

(Mitsubishi) 3,666 2,925 25%6 Toyota 30,110 24,502 23%7 Truong Hai 21,617 17,693 22%8 Vinaxuki 8,680 8,070 8%9 Samco 482 468 3%10 Isuzu 2,997 3,385 - 11%11 Visuco (Suzuki) 2,669 3,001 - 11%12 Hino 2,199 2,690 - 18%13 Vinamotor 15,284 21,174 - 28%14 Honda 4,215 5,909 - 29%15 Vinacomin

- Vinacoal 256 385 - 34%16 Mekong 616 1,622 - 62%Grant Total 119,460 111,946 7%

Best-selling models in 2009

No. Models Sale volume 2009 (units)1 Toyota Innova 8,4752 Toyota Corolla Altis 6,4683 Toyota Fortuner 5,8784 Toyota Vios 5,1415 Chevrolet Spark (GM Daewoo) 4,6036 Ford Everest 3,6427 GM Daewoo Lacetti 3,2868 GM Daewoo Gentra 3,2459 Honda Civic 3,14610 Kia Morning (Truong Hai) 2,689

growth in the coming years as Vietnam iscoming into the era of motorization.Recently, the Ministry of Industry andTrade forecast the Vietnam auto marketto boom in 2015 with 166,000 to 235,000units sold per annum and an expectedyearly growth rate of 17 per cent.

However, the competition amongst

local auto-makers, between importedcars and locally assembled ones ispromising to become tougher andtougher. In the long-run battle for sur-vival and development, there auto-mak-ers must have shrewd strategies.n

Source: VAMA

CULTURE


FamilyReunions

for Tet

? BICH HANH

et, the Lunar New Year holiday,is the most important festivalfor Vietnamese people. This

sacred festival, which occurs sometime between late January or earlyFebruary, (depending on LunarCalendar) has become so familiar tothe Vietnamese that when Springarrives, the Vietnamese wherever theymay be, are all thrilled and excited.They feel an immense nostalgia, wish-ing to come back to their homeland fora family reunion and a taste of the par-ticular flavours of the Vietnamese fes-tivities. Although officially a three-dayaffair, festivities may continue for aweek or more with every effort madeto indulge in eating, drinking, andenjoying social activities. It is also atime for family reunions, and for pay-ing respect to ancestors and theelders. Gifts of food are made tofriends, neighbors and relatives in thedays before Tet.

The Tet of the New Year is, aboveall, an opportunity for the householdgenies to meet those who have beenhelped during the year, namely theCraft Creator, the Land Genie and theKitchen God. Tet is also an opportunityto invite and welcome deceasedancestors back for a family reunionwith their descendants to join the fam-ily's Tet celebrations. Finally, Tet is agood opportunity for family membersto meet. This custom has becomesacred and secular and, therefore, nomatter where they are or whatever thecircumstances, family members findways to come back to meet their loved

ones, gather for a dinner of tradi-tional foods like bánh chưng (asquare cake made of sticky ricestuffed with beans and pork), măng(a soup of boiled bamboo shootsand flied pork) and xôi gấc (orangesticky rice). This is followed by a visitto the local pagodas.

Everyone is in a rush to get a hair-cut, buy new clothes, spruce up theirhomes, visit friends, settle outstand-ing debts, and stock up on tradition-al Tet delicacies. Businesses hangfestive red banners which read"Happy New Year” and city streetsare fes¬tooned with colored lights.Stalls spring up all over town to sellmut (candied fruits and jams), tradi-tional cakes, and fresh fruit and flow-ers. Certain markets sell nothing butcone-shaped kumquat bushes.Others sell flowering peach trees,symbols of life and good fortunewhich people bring into their homesto celebrate the coming of spring. Asvendors pour into the City withpeach trees strapped to their bicy-cles, the streets look like movingpink forests.

The "Mam Ngu Qua"

The "five-fruit tray" on the ances-tral altar during the Tet Holidayssymbolizes the admiration and grati-tude of the Vietnamese to Heavenand Earth and their ancestors, anddemonstrates their aspiration for alife of plenty. The five fruits repre-sent the quintessence that Heavenand Earth bless humans. This is oneof the general sayings about life ofthe Vietnamese, which is "When tak-ing fruit, you should think of thegrower".

Dao, Mai, Quat (the Peach,Apricot and Kumquat)

Coming to Vietnam during theseason of the Tet festival, the visitoris engulfed in an ocean of colourfulflowers. Visiting flower shows, con-templating the buds and blooms,and purchasing blossoms representsone of the distinct Vietnamese cul-tural characteristics. The peach ( in

the North ) and the apricot blossoms(in the South) are symbols of theVietnamese Tet. The warm pink ofthe peach could very well match thedry cold of the North, but the hotSouth seems to be flourishing in theriot of the yellow of the apricot. Themandarin is symbolic of good for-tune and, therefore, people tend tochoose the little plants laden withfruit, big and orange, and verdantleaves for a longer display.

The Giao Thua ( New Year's eve )

The Giao Thua is the most sacredpoint of time, the passage from theold to the new year. It is believedthat in Heaven there are twelveHighnesses in charge of monitoringand controlling the affairs on earth,each of them taking charge of oneyear. The giao thua is the moment ofseeing off the old chieftain upon theconclusion of his term and welcom-ing in the new one upon his assump-tion of office. For this reason, everyhome makes offerings in the openair to pray for a good new year.

After the giao thua is the startof the new year with many cus-toms and practices, amuse-ments and entertainment,all of a distinct Vietnamesefolk culture. If you havean opportunity tovisit Vietnam dur-ing the TetHolidays and towelcome the TetFestivities, togeth-er with theVietnamese people,you will sure-ly be

p r o -f o u n d l yimpressed by thedistinct traditional culturethat is rich in national identity.

Food specialties for TET

On the last day of the old year,the preparation of food to offer tothe ancestors is of special signifi-cance. Dishes to offer to the ances-tors differ in the Northern, Centraland Southern parts of the country,depending on their respectiveweather conditions at the time andon different local agricultural prod-ucts available. What is common in allregions of the country during Tetholidays are the varieties of soups,fried, boiled, or stewed dishes, meat,fish, vegetable... The foods that theVietnamese eat at Tet are varied anddiverse. What they have in commonis that the people throughout thecountry all want to have the bestand the most beautiful looking foodon this occasion to offer their ances-

tors and to treattheir friends andguests.n

Happy New Year2010


? BICH HANH

Lim FestivalThe Lim Festival, organized in Lim

village located 18 km from Hanoi, iswhere Quan Ho, the special folksongs are performed. It takes placeevery year on 13th day of the LunarJanuary. Tens of thousands of visitorsgather to enjoy the dialogues perfor-mances between "lien anh" (malesingers) and "lien chi" (female singers)of the country's most skilled Quan Hosingers. These are male and femalefarmers who sing different types ofsongs in the pagodas, on the hills,and in the boats. Besides this, visitorscan come to the Lim Festival to enjoythe weaving competition of the NoiDue girls. They weave and sing QuanHo songs at the same time. Like other

religious festivals, the Lim Festivalgoes through all the ritual stages,from the procession to the worship-ping ceremony, and includes otheractivities.

The Lim Festival is a special cultur-al activity in the North. The festivalcelebrates the "Quan Ho" folk songwhich has become part of the nation-al culture and a typical folk song thatis well loved in the Red River Deltaregion.

The Lim Festival is also celebratedwith traditional temple games. In onegame, teenage girls must mind astranger's baby, chew pieces of sugarcane in order to create fuel withwhich to start and maintain a fire,cook rice, and prevent a frog fromjumping out of a circle marked on theground. If the baby cries, the fire goesout or the frog escapes, the girl is dis-qualified.

Cau Ngu Festival

This festival of lower Thai DuongVillage in Huong Hai Commune ofHuong Dien District is organizedannually on the 12th day of the 1stlunar month in memory of the villagetutelary genie Truong Quy Cong. Hisalias is Truong Thieu, and he was anative of the North who came to thevillage to settle, teach the locals howto fish, and trade junks.

On the eve of the festival, theentire village begins making offer-ings. Both parts of the village, theupper and lower parts, worshipTruong Quy Cong. Late at night, the"fish worshipping ceremony" occurs,where people pray for peace and thefuture abundance of fish. Every threeyears, games representing sea fishingactivities are organized, such as the"fish catching" game and "net-cast-

CULTURE


POPULAR CULTURAL FESTIVALS

of Vietnam

VietnamBusiness Forum

would like to fea-ture some typical fes-

tivals and specialevents organized

throughoutVietnam.

ing" game. After these games, peopletend to go watch the rowing skiffs.

The "net-casting" performance is aform of entertainment that is charac-terized by rituals to commemorate themerits of the village tutelary genie.

Nui Ba Festival

If you go to Tay Ninh, you shouldvisit Nui Ba, a beautiful mountainlocated in the middle of the MekongDelta, 11km from downtown Tay Ninh.

Nui Ba (Ba Mountain) is often calledMs Den Mountain. According to a leg-end, the mountain was named after ayoung woman called Denh, but whowas referred to as Den. She was thedevout daughter of a guard officer ofthe Mien ethnic minority group. Denleft her house to enter a monastery inthe mountains. She became a nun dueto family pressure to marry a guardofficer's son from the Trang Bang Area.She remained at the monastery untilshe died. After her death, the NguyenDynasty ordered that a mould of herbe cast in black bronze in her honouras the Linh Son Thanh Mau (Saint LinhSon).

During the spring until the after-noon of the 30th day of the 1st lunarmonth, and especially on the day ofthe full moon of the first month,tourists from Ho Chi Minh City and theprovinces of the south pilgrimagehere to worship and sightsee. Startingat the bottom of the mountain, touristsclimb one half of the mountain to SaintLinh Son's communal house and thenfollow a path that leads to a pagoda.This pagoda offers vegetarian meals.Tourists can eat as much as they want,but should donate some money to thepagoda; the amount of the donationdepending on the budget of thetourist.

"Chua Huong" (the PerfumePagoda) Festival

"Chua Huong" - the PerfumePagoda is the name of a collection ofBuddhist temples which are verysacred to Vietnamese people ofBuddhist faith, and an annual visit uphere in springtime is a must for a lot ofbelievers.

Located on the limestone rocks ofHuong Son Mountain in beautiful andmystical surroundings, the pagodasare 70 km or a two-hour from out ofHanoi. Unlike other temples inVietnam, the only way to reach thissanctuary is floating along a narrowbut extremely poetic stream by row-boat. An iron boat can carry 3-5 peopleand a large wooden boat – up to 20locals.

The stream is edged by rice, grass,small paths, and temples here andthere. A local pilgrim can spend threedays to visit the entire area and pray atall the temples. The first temple theyoften stop is called Den Trinh (i.e. TheShrine for First Presenting), whereVietnamese burn the first joss ticks toinform the local deities about theirpresence and pray for a good trip andgood luck for the year ahead. If you areanxious to reach the main Wharf ofHuong Son mountain to start theuphill trip to see the Main Grotto ofHuong Tich, you may skip this temple,especially in the peak season betweenJanuary and early April.

The uphill trip takes an hour climb-ing on the ancient flat and sometimeslippery stones, which have been herefor a thousand years. The road is"breathtaking" in all aspects – you willhave some exercise, and at the sametime have chance to take some stopsto contemplate beautiful scenery anddaily life of local farmers, who plantcassava and apricots in the valleys,who run quickly on the slippery stonewith their burdens of tapioca, apricotsor medicinal herbs whilst you are care-ful with your steps. The main pagoda isset in a huge grotto containing a high-ly decorative shrine. Each stalactiteand stalagmite inside is combinedwith a legend about its miracle andgood luck. Most of them have becomesmall shrines. Remember that thestone grotto is huge and very cool, sostop for a while at the entrance to dryyour sweat before coming in.

The main festive days of ChuaHuong stretches from January to earlyApril. It’s a busy and exciting time.Sometimes it's drizzling and theVietnamese all believe that the realgood things will reach you if you catchrainwater after praying in a sacred

pagoda. And among all the sacredtemples and pagodas in NorthernVietnam, Chua Huong is even moreattractive and mysterious not only forits spectacular scenery, but for thepainstaking road you passed over toreach the top.

Do Son Buffalo Fighting Festival

Although the Do Son BuffaloFighting Festival is officially held onthe 9th of the 8th lunar month in HaiPhong, Vietnam, preparations startseveral months before. Fighting buf-faloes must be carefully selected, wellfed, and trained. The selection of theofficial fighting buffaloes starts in Maywhen qualification matches take placein small villages. Only 6 buffaloes willparticipate in the final fight.

The festival begins with a proces-sion to the communal house whereofferings from several little villages arepresented to the gods; such giftsinclude a buffalo, a pig, and a basket ofsticky rice. The procession, in whichthe buffaloes are covered with redcloth, also includes 12 youngVietnamese men, also dressed in red,who take the buffaloes to the fightingcircle.

After the young men perform the"Opening the match" dance, a pair ofbuffaloes are led into the fighting cir-cle. The two buffaloes fight until thedefeated gives up and runs away. Thewinner then goes on to fight anotherbuffalo until a final winner is deter-mined.

The Quan The Am Cultural Festival

The Quan The Am Cultural Festivalis organized on the 19th day of the sec-ond month (lunar calendar) every yearwith cultural activities which helprestore and promote the traditionalculture of Viet Nam.

The festival is held on Ngu Hanhmountain, in Danang City, Vietnam.The Quan The Am Festival was firstorganized in 1962, for the inaugura-tion of the AvalokiesvaraBuddhisattava statue in Hoa Nghiemcave at Thuy Son Mount, in the MarbleMountains of Vietnam. The same year,


Happy New Year2010

(continued on P.72)

CULTURE


? THANH YEN

ying on the southern bank ofthe mild Duong River, theDong Ho painting village

nowadays no longer keeps denseand busy spectacles of in end-yearmonthly paintings markets. The vil-lage’s lanes are still full of red andyellow colors of paper, but the coloris not originated from the red ofyoung brick, the yellow of diepflower (butterfly), the black of coalof burned bamboo's leaves, the glit-ter white of ground sea shell. TheDong Ho village now is colorful ofthe printing paper dyed with indus-trial pigment, of paper-made red,violet horses, multistoried houses,cars. The one-time painting villageis now famous for making papervotive objects that are burned asreligious offerings.

Nostalgia

According to Mai villagers, thefolk name of the Dong Ho painting

village in Thuan Thanh district ofBac Ninh Province (north of Hanoi),the painting career started from thecentury 16th. In its golden age, thevillage had hundreds of paintingmodels. The village was the mostbustling from July and August(Lunar Calendar) till the end-year.At that time, all families of 17 clansin the village with thousands peo-ple from the elderly to the child,boys and girls attended to makepaintings. Markets of Dong Hopaintings was always a festival par-ticularly those in December (LunarCalendar) held in Dec 6, 11, 16 and26. Apart from buyers and sellers,the Dong Ho painting markets alsoattracted lots of painting lovers,poets and writers from Hanoi andneighboring areas for sightseeingand entertainment.

At the time when Dong Hopaintings were produced by collec-tives, the village was still prosper-ous. Tens of thousands of Dong Hofolk paintings were exported toEastern European nations andAfrican nations. The Dong Ho vil-lage became a symbol ofVietnamese folk paintings. Dong Hopaintings have been displayed inthe Guinea national museum of artsand granted the most honorableaward at the the IBA (InternationalBook Artists) Exhibition inGermany’s Leipzig in 1971. Dong Hopainting makers were proud of theirproducts having been brought out-bound to introduce Vietnam’s cul-tural values to international friends.

The special character of DongHo paintings is not originated fromartistic emotion, but from variety ofcolors, cubes and lines which aresimple and plain but live and lovely.Paintings’ contents are familiar tothe living standard of farmers in theRed River delta. Another special

Breath of Picture Village

Oh, girl with bluesash Follow me to MaivillageMai village havingrich customs With gentle river forbath and printing ofpaintings

point is all materials to produceDong Ho paintings are collectedcompletely from nature, whichmakes this kind of painting haveperfume of flower and grass. Thebackground paper, made of bark ofa tree called "Dzo, is originallywhite. People use natural materialsto change the colors of the paperswhich are usually orange, pink, yel-low, purple… villagers covered thepainting by a layer of paste namely“diep” to protect the painting andtheir colors. The “diep” paste ismade of sea shells ground andmixed with sticky rice paste (called“ho nep”). Unlike the painting gen-res of Hang Trong, which was com-bined between printing on carvedboards and adorning colors, DongHO paintings are printed fromcarved boards. Each painting modelincludes at least four boards of col-ors and one carved board. EachDong Ho painting often has 7-8 col-ors, printed in order from the red,green, white, pink or yellow to theblack. Each carved board made ofthe wood of “thi” tree could be usedfor tens years. There are beautifulsets of carved boards having beenhanded over among generationssuch as a heirloom.

Origins

In the busy Dong Ho villagenowadays, we can find places whichstill keep the breath of the one-timepainting village. It is a Dong Hopainting cultural center of artistNguyen Dang Che’s family, or a dis-play room of more than 500 carvedboards of Dong Ho paintings ofartist Nguyen Huu Sam or sound ofchisels in small class by youngteacher, artist Nguyen Van Manh.

Many Vietnamese journalists,including people who have writtenmany articles on the Dong Ho paint-ings and the making of painting,said no as being questioned aboutNguyen Van Manh. However, thestory of the young painting makerNguyen Van Manh, whose alias isToong, has been known by manyAmerican painters. Manh has spentmany years on studying and main-

taining the making of Dong Hopaintings.

Vietnamese-American femalepainter cum architect Tran Thi HoaLan and her husband, and writerMichel Clack are the first friends tointroduce me to Nguyen Van Manh.It seemed that we were impressedwith the young artist’ pure mind, allcalled him with the lovely aliasToong. Toong and his students arehard-working days by days in asmall carving and printing factory,the only one left so far in the DongHo village will a wish to maintainand preserve this kind of folk paint-ing line. Hundreds of carved boardsof folk painting models have beenrestoring by Toong and his stu-dents.

If the printing phase seems tonot selective about artists, thepainting Dong Ho painting modelsand carving boards require paintersand carvers for their love to the artand professional skills. With thenature of a artist and skill of a work-er, Toong has created carvingboards meeting strict requirementsin quality by his teachers such asNguyen Dang Che, Nguyen HuuSam.

During a recent trip to the DongHo village, I visited Toong while hewas busy of spreading “diep” pasteand printing. Toong said more hav-ing a thorough grasp of quintes-sence in the making printing papers,more carving boards are beautifulamd familiar with the life. ArtistNguyen Dang Che is considered todeserve the credit for restoring par-tially the Dong Ho painting line. Butit is not fair id we don’t remind con-tributions by the young artistNguyen Van Manh.

For that very reason, after manyyears devoting quietly to the restor-ing of Dong Ho paintings, Toongand his students’ contributions havebeen recognized and encouragedby the Vietnam EthnologyMuseum’s directorate. Carvingboards of Dong Ho paintings,including many restored by Toongand his students have been intro-duced to the public at a recent exhi-bition.

Conclusion The Dong Ho painting line has

gradually been restored, but slowly.Apart from artists such as Sam, Cheand Toong, almost Dong Ho vil-lagers have trickled out of style; nowthey make paper votive objects.High profits from making papervotice objects have made the print-ing of paintings faded from vil-lagers’ mind. To keep the enthusi-asm to the printing of painting,Toong and his group of studentsfended for themselves by makingpaper votice object patterns to feedthe printing of paintings. Sitting inhis father’s display room of Dong Hopaintings, Nguyen Huu Qua (thefirst-born son of Artist Nguyen HuuSam), who determined a universitygraduate of finance to follow hisfather to restore the folk paintingline, sarcastically recited four linesof poetry:


Happy New Year2010

“Oh, Girl in blue jeanFollow me to Mai vil-lage Mai villagers changetheir livelihoodnowadaysTaking paper ovticeobjects as breadwin-ner instead!”

CULTURE


the festival was reorganized in KimSon cave after the construction of theQuan The Am Pagoda on the Kim SonMount. Until 1991, this festival wasorganized annually on a large scaleand celebrations lasted for threeentire days.

The Quan The Am Festival con-sists of two parts: the religious cere-mony and the festival itself. The cere-mony, similar to Buddhist rituals, con-sists of flower offerings and prayers.The Dharma-preaching sessionsabout Avalakiesvara Buddhisattavaare also very interesting.

Several cultural activities bearingthe national colors of Vietnam, suchas singing folk songs, chess playing,music, painting, carving, lion danc-ing, offering lamps on the river, andclassical opera also take place. TheQuan The Am Festival is organizedon the 19th day of the second lunarmonth; this festival, as well as manyothers, is held in an attempt torestore and promote the traditionalculture of Vietnam.

Giong Festival

The Giong Festival is held annual-ly in Phu Dong village, Gia Lam dis-trict, Hanoi, on the 9th day of the 4thmonth of the lunar calendar. The datecommemorates Saint Giong who

defeated An invaders. In order toshow their gratitude to the hero ofGiong Village, who sacrificed his lifeto fight the invaders, people haveproclaimed him Saint Giong.Preparation for the festival occursfrom the 1st day of the 3rd month tothe 5th day of the 4th month of thelunar calendar. The festival is cele-brated from the 6th to 12th of thefourth lunar month with a series ofprocessions, rituals and perfor-mances, each taking place on a par-ticular day. On the 6th, there is a cere-mony of carrying water from the wellat the Mother Temple to the UpperTemple. On the 7th, flags are carriedto the Mother Temple. On the sameday offerings of boiled rice and saltedegg-plants are also carried to theUpper Temple, a practice that com-memorates the agricultural meals ofearly times. Another vestige ofancient times occurs at night on thisday when young men and womenrun after one another on the dyke ofthe Red River. Also on the 7th day, awater puppet performance is held infront of the Phu Dong Temple. On the8th day, 28 women are selected torepresent the generals of the Aninvaders. The main day of the festivalis the 9th of the fourth lunar month.On this day flags are carried from theMother Temple to the Upper Templeand sacrifices are made to the genie.The guilds perform ritual dances and

songs and there is a tiger catchingshow. Fighting against the Yininvaders is re-enacted and there is asolemn march of the Van Lang army.Finally, the two battles against theinvaders at Dong Dam and Soi Bia aresymbolised by flag dances and victo-rious feasts. On the 10th day the"troops" are reviewed and the invad-er-generals, after "being defeated",give offerings to Giong. On the 11th,the ceremony of cleaning and wash-ing weapons with holy water takesplace. On the 12th, a procession goesto inspect the battlefield. On this dayof the festival, tribute is given to thegods of heaven and earth. At theGiong Festival, people can make con-nections with their neighborhood,with relations between the individu-als within a community, and with thepast and present. This festival blendstogether the traditions of love for themotherland and the preservation ofcultural heritage.

Hon Chen Temple Festival

The Hon Chen Temple Festival isorganized twice every year, in the 3rdand the 7th lunar months. The festivaltakes place at the Hon Chen temple,10 km west of Hue. It starts with a pro-cession referred to as the GodWelcoming ceremony; it is said tobring all the worshipped Gods fromthe village’s temples and shrines tothe communal house where variousrituals are performed, including theprocession in honour of Saint MotherThien Y A Na. The procession takesplace at night with a long line of boatsbound together into bigger rafts onthe Perfume River shining with myriadof lights. The Hon Chen TempleFestival includes a performance filledwith imperial characters. Actorsdressed in clothes with splendid tur-bans and tunics look like princes andprincesses of the Nguyen dynasty.These shows take place in the naturalsettings of mountains, hills, and rivers.This Antique Museum of Nature alsoshows flags, fans, hammocks, umbrel-las, weapons, and offerings that visi-tors would be unable to see outside ofthe exhibition.n

(from P.69)

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