Vietnam among Australia’s fastest growing export markets in ASEAN region: Australian Ambassador Hugh Borrowman

Australia-Vietnam trade has grown very fast in recent years. The average growth rate of bilateral trade in the 2010-2014 period was nearly 10 percent and Mr Hugd Borrowman, Australian Ambassador in Vietnam forecasts that once TPP negotiations are concluded and the trade deal is implemented, Vietnam -Australia bilateral trade ties will strengthen even further. In the upcoming time, Vietnam will have to face the reduction in development aid from donors and international organizations, could you please tell us about Australia’s aid policy to Vietnam? Mr. Hugd Borrowman: Vietnam has always been an important partner of ours in the region from both a political and economic standpoint and soour development assistance to Vietnam will be maintained until at least 2020 and possibly beyond. However, over the next five years we plan to transition our support away from a traditional donor-recipient relationship towards promoting an economic partnership between Australia and Vietnam. This … [Read more...]

Falling oil prices reveal reliance on crude exports

Vietnam, an energy exporting country, is struggling to deal with the negative impacts of lower oil prices as revenue shortfalls make lingering fiscal weaknesses even more visible, economists said. Oil prices have fallen to a 6.5-year low on Monday, amid continued worries of high global oil supply while investors expect the demand from China to remain weak due to its growth slowdown. Already trading at six-year lows on a prolonged slump, US crude fell $2.21 to $38.24 per barrel, according to the Associated Press. Oil hadn't closed below $40 since February 2009. Falling oil prices have cut Vietnam’s export revenues, dealing a strong blow to the state budget, economist Le Dang Doanh said. The country exported over 5.3 million tons of crude oil worth $2.45 billion between January and July, down 0.3 percent in volume and 47.1 percent in value over the same period last year, according to the General Statistics Office. With lower export earnings, crude oil’s contribution to … [Read more...]

Dong A took a false step when trading gold

VietNamNet Bridge - Dong A Bank, which was once of the best joint-stock commercial banks in Vietnam with advantages in card technology and retail banking, has gone downhill because of the gold trade. Just one week after Dong A Bank was put under the State Bank’s control, its CEO Tran Phuong Binh, a veteran banker, was dismissed from his post. Dong A remains the only bank in Vietnam which has technology allowing ATM (automatic teller machines) to sell gold. Dong A was one of the bank pioneers in developing card services. In 2005, when other Vietnamese commercial banks applied simple card technologies, Dong A became a ‘big guy’ in the field. It hired Viet Kieu (overseas Vietnamese) experts who had worked for many years for CitiBank to help develop the card center. Dong A was the only Vietnamese bank CitiBank once eyed in 2006-2007. The US-based bank once sent a group of 60 experts to negotiate with Dong A on buying Dong A’s shares. A deal might have been … [Read more...]

Falling oil prices reveal Vietnam’s reliance on crude exports

The Bach Ho Oil Field in southern Vietnam. Photo: Vietnam News Agency Vietnam, an energy exporting country, is struggling to deal with the negative impacts of lower oil prices as revenue shortfalls make lingering fiscal weaknesses even more visible, economists said. Oil prices have fallen to a 6.5-year low on Monday, amid continued worries of high global oil supply while investors expect the demand from China to remain weak due to its growth slowdown. Already trading at six-year lows on a prolonged slump, US crude fell $2.21 to $38.24 per barrel, according to the Associated Press. Oil hadn't closed below $40 since February 2009. Falling oil prices have cut Vietnam’s export revenues, dealing a strong blow to the state budget, economist Le Dang Doanh said. The country exported over 5.3 million tons of crude oil worth $2.45 billion between January and July, down 0.3 percent in volume and 47.1 percent in value over the same period last year, according to the General Statistics … [Read more...]

Bank M&A deals cool down near year-end

VietNamNet Bridge - Analysts believe Merger & Acquisition (M&A) deals will be quiet for the rest of the year, while deals under negotiation will complete necessary procedures. Earlier this year, investors privately speculated that Dong A Bank would merge with ABBank. A senior official of the State Bank then affirmed the central bank would create favorable conditions for the two banks to merge. However, in March the State Bank said one of the two banks had some problems. Rapid-fire information about Dong A Bank has since been released. Kido, a sweets manufacturer, was reported considering injecting money into Dong A in its strategy to jump into the banking sector. However, it later cancelled the plan because of ‘Dong A’s unsettled problems’. Later, a source from Dong A Bank said a foreign investor was considering investing in Dong A. And most recently, the bank has been put under the State Bank’s special control because of its ‘serious … [Read more...]

SBV vows to restructure financial leasing companies

VietNamNet Bridge - Despite the high demand and the fertile market, only 50 percent of Vietnamese owned finance leasing companies have been profitable. Most of them are facing big challenges while their financial capability is limited and Vietnam is due to fully integrate into the world. According to the Vietnam Finance Leasing Association (VILEA), only four out of eight companies do not have accumulated losses, namely VietinBank Leasing, Vietcombank Leasing, Sacombank Leasing and ACB Leasing. Meanwhile, BIDV Leasing and Agribank Leasing I made profit in 2014, but both of them have relatively high accumulated losses. The companies to be forced to undergo restructuring include Vinashin Leasing, Agribank Leasing I and Agribank Leasing II. Meanwhile, BIDV Leasing will be operating while settling debts. An analyst noted that there was a time in the past when finance leasing companies and commercial banks focused on leasing ships and transport vehicles. Later, as the world’s … [Read more...]

Does bank restructuring mean fewer banks?

VietNamNet Bridge - Economists believe that Vietnam’s emerging economy needs a sufficient number of commercial banks to satisfy people’s demand, and that more than 30 banks is ‘more than enough’. A series of bank merger & acquisition (M&A) deals were made in the first six months of the year. Phuong Nam Bank was merged with Sacombank, MHB with BIDV, and PG Bank has been admitted by VietinBank and Mekong Bank by Maritime Bank. The World Bank, in its updated report about Vietnam’s economy in the first half of 2015, noted that unlike previous years, when Vietnam mostly witnessed the M&A deals among small banks, some ‘big guys’ like BIDV and VietinBank appeared in bigger deals this year. In the Phuong Nam – Sacombank M&A deal, Le Hung Dung, who represents Eximbank’s capital in Sacombank, said that the deal would bring big benefits. After the merger, Sacombank has chartered capital of over VND18 trillion which can … [Read more...]

Improving mechanism and resources for agricultural development

(VOVworld) – Despite economic difficulties, Vietnam has exerted efforts in implementing the Party guidelines and government policies on agriculture, farmers, and the countryside. Several meetings on agriculture and rural development were held among leaders of the central government, ministries, sectors, and localities. A ceremony to honor enterprises and businesspeople in new rural development (photo: Improving mechanisms and resources for agriculture and rural development was the main topic of the national conference on July 3 reviewing 5 years of implementing the project "Expanding the role and responsibilities of the Vietnam Farmers’ Association in agriculture and rural development and improving the farmer class from 2010-2020". On August 20, 2015, the Party Central Committee’s Economic Commission, the Ministry of Agriculture and Rural Development, and the Communist Party Review co-organized a conference on enhancing industrialization … [Read more...]

Unnamed foreign investor wants to buy half of Dong A Bank

VietNamNet Bridge - Dong A Bank CEO Tran Phuong Binh said a foreign investor wants to buy a 49 stake to become a strategic shareholder of the bank. If the deal succeeds, Dong A will be added to the list of commercial banks that can restructure without help from the State Bank. Dong A has become a hot topic in local newspapers after Binh said at the 2015 shareholders’ meeting that Kido, a sweets manufacturer, planned to pour VND1 trillion into Dong A Bank in its restructuring strategy. The information about Kido’s investment in Dong A pushed Dong A’s share prices up from VND3,500 per share to VND4,700. It was expected that Kido would buy Dong A’s shares at VND10,000 per share. However, Thoi Bao Kinh Te Sai Gon on August 3 quoted sources as saying that Kido has decided not to buy VND1 trillion worth of Dong A Bank’s shares as initially reported. The sources said the buyer canceled its plan because of Dong A’s financial situation that needs to be … [Read more...]

Deputy PM: agricultural restructuring proves effective

Enhancements seen in the added value, export, productivity, and quality of agricultural products are proof of the effectiveness of agricultural restructuring measures implemented across the country over the past two years. Deputy Prime Minister Hoang Trung Hai, who is also Head of the Steering Committee for Agricultural Restructuring, made the remarks at a recent conference co-organised by the Committee and the Ministry of Agriculture and Rural Development. The biggest achievement has been the shift in mindsets among farmers, businesses, authorities and scientists, the Deputy PM said. Farmers have focused more on enhancing product quality and productivity in their agricultural production practices to ensure their products are clean and the origins are verified. Science and technology application has also been fostered in recent agricultural production. Deputy PM Hai urged 16 localities to map out specific action plans on agriculture with a focus on strengthening the … [Read more...]

Google unveils surprise restructuring under Alphabet

Google has unveiled a surprise restructuring, creating a new parent company called Alphabet Inc. Under the rebranding, Google will retain its best-known businesses, such as search, apps, YouTube and Android. Some of the newer entities, such as the investment and research divisions, the "smart-home" unit Nest, and the drone arm will be run under Alphabet. Google founder Larry Page said it would create a simpler structure for what had become a diverse group of businesses. "This new structure will allow us to keep tremendous focus on the extraordinary opportunities we have inside of Google," he said in the blogpost. "Our company is operating well today, but we think we can make it cleaner and more accountable," he said. "The whole point is that Alphabet companies should have independence and develop their own brands." Mr Page will become chief executive of Alphabet, with senior vice president Sundar Pichai becoming CEO of Google. Mr Page's fellow Google co-founder Sergey Brin … [Read more...]

The Government’s regular meeting – July 2015

THE GOVERNMENT ------- SOCIALIST REPUBLIC OF VIET NAM Independence - Freedom - Happiness --------------- No. 57/NQ-CP Ha Noi, August 06, 2015 RESOLUTION THE GOVERNMENT’S REGULAR MEETING - JULY 2015 THE GOVERNMENT Pursuant to the Law on Organization of the Government dated December 25, 2001; Pursuant to the Decree No. 08/2012/ND-CP of the Government dated February 16, 2012 promulgating the working regulation of the Government; Based on the discussion of the Cabinet’s members and the conclusion of the Prime Minister at the Government’s regular meeting in July 2015 held on July 31, 2015, RESOLVES: 1. Regarding the socio-economic performance in July and the first 7 months of 2015; the implementation of the Resolution No. 01/NQ-CP dated January 03, 2015 of the Government. The socio-economic situation in July and the first 7 months of this year continued to have positive changes and results in almost all fields. The macro-economy remained … [Read more...]

Int’l Cooperation in Public Financial Management

To enhance the performance of public finance management reform and foster cooperation relations between the Ministry of Finance of Vietnam and development partners, the Ministry of Finance and the World Bank (WB) co-hosted a high-level dialogue meeting of the Public Finance Partnership Group 2015 (PFPG 2015) in Hanoi on July 23, 2015. As part of PFPG's working plan, the meeting was an important event for the Ministry of Finance and development partners. PFPG Conference 2015 delved into discussions and dialogues: Strengthening of PFPG activities in 2015-2016; and solutions and policy recommendations concerning SOE restructuring, tax and customs procedure reform. Particularly, 2015 is an important year as it is the last year of the five-year socioeconomic development plan (2011-2015) and lays the groundwork for the next five year plan (2016-2020). The Ministry of Finance has actively guided solutions and tasks for implementing the socioeconomic development plan and State budget … [Read more...]

Gov’t releases monthly resolution

VGP – Bold measures for flood control, faster restructuring of weak commercial banks, drafting of economic restructuring planning in 2016-2020, and university entrance exams for the academic year of 2015 topped the agenda of the Government’s regular meeting in July. Illustration photo The Government yesterday issued a resolution on outcomes of its regular monthly meeting for July, asking ministries, agencies and localities to continuously pursue preset tasks stipulated in resolutions of the National Assembly, Resolution 01/NQ-CP, dated January 3, 2015, Resolution 19/NQ-CP, dated March 12, 2015 and other regular monthly resolutions to fulfil goals ahead of schedule. Overcoming flood consequences The Government tasks localities and agencies to positively surmount flood consequences in Quang Ninh province and othernorthern localities and support residents to early stabilize lives and actively prepare for natural disasters and epidemics in affected areas. The … [Read more...]

Bankers say bad-debt ratio is not that high

VietNamNet Bridge - While economists doubt commercial banks can reduce the bad-debt ratio to below 3 percent by the end of August, bankers said the target was within reach because the current situation is not as bad as once thought. The bad debt ratio of some commercial banks, including the better ones, has increased again. VietinBank, for example, reported that non-performing loans (NPL) increased to VND8 trillion from VND4.8 trillion earlier this year. The NPL ratio rose to 1.5 percent from 0.9 percent in late 2014. VietinBank’s fifth-group debts (the debts with the highest risk) by the end of March had increased by 2.6 times from VND2 trillion to VND5.5 trillion. By the end of April 2015, while Sacombank’s outstanding loans had increased by 5.6 percent, the bad debt ratio had also increased to 1.19 percent from 1.18 percent at the end of 2014. Sacombank collected VND200 billion worth of principal this year thanks to the sale of debts to the Vietnam Asset … [Read more...]

FTAs and opportunities for Vietnam’s market restructuring

(VOVworld) – Vietnam has proven that it is fully integrating internationally by a series of free trade agreements that have been signed or will be signed in the near future. Although Vietnamese enterprises face many challenges and many things need to be done to take advantage of the trade deals, this is a great opportunity for Vietnam to restructure its market and economy. Ando International, a Vietnamese garment firm in Ho Chi Minh City. (Photo: ILO in Asia and the Pacific) Two of the 10 bilateral and multilateral free trade agreements Vietnam has signed are trade deals with the Republic of Korea and the Europe-Asia economic union. The FTAs will create new opportunities for businesses to grow by reducing or removing import tariffs, and allow Vietnamese enterprises to participate in the goods supply chains of foreign partners, helping to stabilize production, improve competitiveness, and balance the import-export market so as to avoid dependence on a single market. … [Read more...]

Asian shares mostly higher on Greece deal

Most Asian stock markets have risen following the news of a deal between Greece and its creditors. Following marathon talks, eurozone leaders agreed a deal to keep Greece afloat and remain in the eurozone. However, the bailout is conditional on Greece passing all the agreed reforms in parliament by Wednesday. The news lifted stock markets in Europe and the US on Monday, while in Japan on Tuesday the benchmark Nikkei 225 closed up 1.5% at 20,385.33. Evan Lucas, market strategist at trading firm IG, said that although the deal reduced the risk of a Greek exit from the eurozone right now, the bloc still faced significant issues in the medium term. "Greek politics could collapse under the strain of this new deal and the subsequent elections that may transpire," he said in a note. "The viability of the programme is also a large risk if the 'reform' process is disjointed or feeble or straight out rejected by new governments." Shares of Sony were down 1.2% after the electronics company … [Read more...]

Minister urges move toward sustainable seafood sector

A farmer harvests shrimp in the Mekong Delta province of Bac Lieu. Localities are advised to step up their efforts to ensure sustainable aquaculture, Minister Phat said. — VNA/VNS Photo Duy Khuong BAC LIEU (VNS) — Agriculture Minister Cao Duc Phat said yesterday that localities nationwide need to step up efforts to ensure sustainable aquaculture, especially of key products like shrimp and tra fish. Addressing a conference held in the Cuu Long (Mekong) Delta province of Bac Lieu to review two years of implementing seafood industry reforms, he called for existing shrimp ponds and productivity to be maintained while taking full advantage of shrimp-mangroves and shrimp-rice farming models. Doing this will increase the industry's competitiveness and help expand its global market share, he said. He said the breeding of white-legged shrimp should be done during favourable weather conditions and productivity improved in intensive farming and advanced intensive farming models … [Read more...]

Korean zombie companies threaten banks’ books as economy slowing

Keangnam Enterprises is trying to sell the 72-story building, constructed in Vietnam’s capital Hanoi in 2011. Photo: Ha An Back in better days, South Korea’s Keangnam Enterprises Ltd. built Southeast Asia’s second-tallest skyscraper, two years after posting record operating profits. Now, the Asan-based company is trying to sell the 72-story building, constructed in Vietnam’s capital Hanoi in 2011, and in April, its shares were delisted after it filed for receivership. Keangnam Enterprises is among the growing number of companies whose operating income doesn’t cover loan interest expenses as expansion in Asia’s fourth-largest economy slows, posing a "significant risk" to the asset quality of local lenders, Moody’s Investors Service says. Firms with incomes falling short of debt servicing costs for three straight years rose to 3,295 in 2014, or 15.2 percent of the total, from 12.8 percent in 2009, according to the Bank of Korea. The central … [Read more...]

Greece debt crisis: Leaders try to thrash out deal

Eurozone leaders have talked through the night in Brussels in a bid to agree terms for a new bailout for Greece. Reports say a draft compromise has been put to the emergency summit but no details have emerged so far. Without a new bailout, Greece's banks face collapse and the country could exit the euro. Greece is being told to pass legislation on a series of reforms by Wednesday before any talks on another bailout can begin. But the BBC's Chris Morris in Brussels says there is still no agreement on exactly what Greece has to do. Earlier, eurozone finance ministers submitted a list of measures to the leaders following two days of fraught discussions. But one Greek government official called the proposals "very bad". Another said some of the proposals appeared designed to "humiliate" Greek Prime Minister Alexis Tsipras and his left-wing Syriza government. The summit was paused for several hours overnight to allow talks between Mr Tsipras, German Chancellor Angela Merkel, French … [Read more...]