Last update 11:02 | 27/05/2014
VietNamNet Bridge – The State Bank of Vietnam (SBV) said in a statement released on May 25 that it is always ready to intervene in the gold market that has become volatile in recent days.
A source told the Daily that the central bank has stocked up on a large amount of gold bars since late January. Therefore, the agency can organize gold auctions at any time, instead of importing gold from abroad.
SBV deputy governor Dao Minh Tu said in the statement that the domestic gold market had been stabilized since early this year. Gold prices have moved in tune with supply and demand on world and domestic markets.
The gap between local and international gold prices has sharply narrowed down, reaching a record low of around VND1 million for each tael. However, domestic gold prices have sharply soared in recent days.
Having followed and analyzed market information, the central bank has seen no major volatility in global gold prices as well as gold supply and demand on the market.
Therefore, psychological and speculative factors triggered by East Sea tensions have led local gold prices to surge, Tu said.
The central bank has advised the public to stay vigilant against rumors circulated by ill-intentioned elements related to the gold, foreign currency and monetary markets to avoid incurring losses and doing harm to the economy.
Therefore, the market has become stable. Transaction volume has been declining while gold prices have lost VND800,000-900,000 per tael compared to early last week.
However, gold prices have bounced back slightly since last Friday.
The central bank is still keeping a close watch on the market. If strong volatility remains, the central bank will intervene in the gold market as it has enough gold in stock, Tu said.
Gold prices have run wild with buying demand surging over the past two weeks.
Saigon Jewelry Company (SJC) has reported daily transactions of around 3,000 taels, jumping three-fold against normal days.
However, Nguyen Cong Tuong, SJC’s deputy sales manager, said customers bought just 1,000 to 2,000 gold taels each day over the weekend, so it was easy for SJC to buy gold to balance its position. Many people still rushed to sell the yellow metal.
According to the central bank’s HCMC branch, local enterprises and banks bought around 138,500 gold taels while selling 141,000 taels from May 15 to 20, resulting in a net sale of 2,500 taels.
Vietcombank's morning rate sank between VND20 and VND30 to stand at VND21,100 per dollar for buying and VND21,150 for selling.— File Photo
HA NOI (VNS) — The price of gold at commercial banks declined sharply yesterday after the State Bank of Viet Nam announced a commitment to stabilising the gold and forex market.
After the market was affected by the current East Sea dispute between Viet Nam and China, the Central Bank confirmed that the gold and forex market would continue operating normally.
Central bank leaders stressed that they continued to monitor the situation of the gold and forex market closely and were willing to take any measures needed to stabilise the market.
Yesterday, the forex rate continued to decrease by VND30-40 per dollar.
Currently, the rate is between VND21,150 and VND21,160 per dollar for selling while buying price hovers at VND21,070 to VND21,110 per dollar.
Vietcombank's morning rate sank between VND20 and VND30 to stand at VND21,100 per dollar for buying and VND21,150 for selling.
The dollar price at the Bank of Investment and Development of Vietnam (BIDV) was listed VND30-40 per dollar lower, finishing at VND21.100 and VND21.150 respectively.
VietinBank also significantly reduced its buying price. Its greenback note was listed at VND21,100 for buying and VND21,155 for selling.
Similarly, Agribank's price was VND21,095 per dollar for buying and VND21,150 for selling.
Other commercial banks such as Techcombank, ACB and Dong A Bank also reduced their buying and selling prices. However, Eximbank and Sacombank did not. Their rates for buying and selling stayed at VND21.080/VND21.160 and VND21.080/VND21,170 respectively.
The average inter-bank exchange rate was maintained at VND21,036 per dollar and the Central Bank's interest rate also hovered at VND21,100 and VND21,246.
The nation posted a 19.5 tonne increase in gold demand in Q1 this year, including 4.5 tonnes of jewelry and 15 tonnes of gold bullions with a value of US$810 million, a 5 per cent rise compared to the same period last year, according to the latest report of the World Gold Council.
Last year, the nation ranked seventh worldwide in terms of gold consumption, importing 92.2 tonnes of gold worth $4.16 billion. — VNS
Last update 07:50 | 21/05/2014
VietNamNet Bridge – Fast-food giant McDonald’s plans to have a total of 4-5 restaurants in Vietnam this year as part of an ambitious goal for around 100 restaurants in the next decade, McDonald’s Vietnam said.
The second McDonald’s restaurant in HCM City.
Nguyen Huy Thinh, managing director of McDonald’s Vietnam, told reporters in HCMC on Monday that McDonald’s would focus on the HCMC market before reaching out to Hanoi.
Nearly three months after the first eatery came into service at 2-6 Bis Dien Bien Phu Street in HCMC’s District 1, McDonald’s will inaugurate a second facility in the city this Friday at 2-2A Tran Hung Dao Street in District 1, adjacent to the landmark Ben Thanh Market.
The new three-storey restaurant, which is known as McDonald’s Ben Thanh, can serve 260 guests at a time, or 90 seats fewer than the first, McDonald’s Da Kao.
Instead of offering the drive-thru service, McDonald’s Ben Thanh has a To-Go booth allowing customers to place orders without having to step inside the restaurant.
McDonald’s Da Kao reportedly served 400,000 customers in the first month of operations. Thinh said that the exact number of guests in the first three months had not been updated but said that business results went beyond expectations.
Thinh said a majority of McDonald’s customers were young in the initial time but the number of senior guests and family members were on the rise. Big Mac was the favorite, he added.
McDonald’s currently buys vegetables grown in the Central Highlands city of Dalat and has to import other ingredients. Thinh said McDonald’s was looking for more local suppliers.
Commenting on the target for 100 restaurants in Vietnam, Nguyen Bao Hoang, founder of Good Day Hospitality, the franchise holder of McDonald’s brand in Vietnam, said this was obtainable based on the fact that McDonald’s had around 400 restaurants in the Philippines, 260 in Malaysia and 195 in Thailand.
Last update 11:00 | 21/05/2014
VietNamNet Bridge – The 18-day flow of money into Vietnam’s stock market suggests overseas money managers are unfazed amid concern that anti- China riots in the country will deter foreign investment and curb economic growth, read a story published by Bloomberg on May 19.
It said foreign investors were net buyers on the Ho Chi Minh City stock exchange every day since April 18, the longest stretch of purchases since January. They added about 93 million USD to their holdings even as the benchmark VN Index slumped 8.8 percent through May 16.
According to the article, Advance Emerging Capital, Samsung Asset Management and Jefferies Group Inc. said they’re still upbeat about Vietnam as inflation stays low, the Government removes bad debt from banks and the prospect of a Trans-Pacific Partnership trade deal bolsters the outlook for exporters.
“Our view of the outlook for Vietnam remains bullish,” the article quoted an email from Samir Shah, an investment manager at Advance Emerging Capital in London, which oversees about 750 million USD, who affirmed that “Steady economic progress looks set to continue.”
International investors have bought a net 188 million USD of Vietnam stocks in 2014, heading for the ninth straight year of purchases, according to data compiled by Bloomberg.
Companies including PXP Vietnam Asset Management say the Government may raise foreign ownership caps this year, giving investors even more room to boost holdings.
US-based exchange-traded funds focused on Vietnam have received a net 99.9 million USD this year, equivalent to almost 27 percent of their total market capitalisation. That’s the biggest increase of all 12 Asian countries tracked by Bloomberg.
The article also noted that Vietnam’s policy makers are trying to bolster an economy that the World Bank estimates will grow 5.4 percent this year. Gross domestic product rose 4.96 percent in the first quarter of 2014, while inflation fell below 5 percent in February for the first time since 2009.
The Vietnamese Government set up an asset management company to acquire non-performing loans and has also allowed foreign investors to take bigger stakes in local lenders.
Negotiators are still working to conclude the Trans-Pacific Partnership free trade deal, which would link a region with 28 trillion GDP in annual economic output, about 39 percent of the world total.
The article concluded with Tony Diep, Hanoi-based managing director at Indochina Capital, saying that foreign investors “think this is the best time to buy,” adding that “they like the valuation and they think the tension is just a short-term phenomenon”.
Its main imports from Thailand were machinery, oil and gas, auto parts, animal feed, and pharmaceuticals. — Photo autopro
HCM CITY (VNS) — Viet Nam and Thailand target 20 per cent annual growth in trade, hoping to increase it to US$15 billion by 2020, the Viet Nam Chamber of Commerce and Industry said.
At a Viet Nam – Thailand Business Meeting held in HCM City yesterday, Nguyen The Hung, deputy director of the VCCI's HCM City chapter, said last year Thailand became Viet Nam's biggest trade partner in ASEAN after trade growth rose 9 per cent to $9.4 billion.
In January this year he said trade was worth $1.4 billion of which Viet Nam's exports - mostly mobile phones and accessories, steel, and seafood - accounted for nearly $500 million.
Its main imports from Thailand were machinery, oil and gas, auto parts, animal feed, and pharmaceuticals.
Hung said the two countries have great untapped potential in trade, and many promotional programmes have been organised with an eye on this.
For instance, a delegation of 10 Thai food companies yesterday came to HCM City to show off their products and look for partners.
Prasatsuk Niyomrat, an official in Thailand's Department of Industrial Promotion, said the visit was also meant to obtain information for Thailand's small and medium-sized enterprises about regional markets ahead of the formation of the ASEAN Economic Community in 2015. — VNS
Last update 12:08 | 15/05/2014
VietNamNet Bridge – The banking system is plagued by low credit growth, huge liquidity but firms unable to borrow, and difficulty in selling mortgaged assets to liquidate bad loans, heard a meeting between National Assembly members representing HCM City and the central bank in the city on Monday.
Packages are manufactured at My Chau Printing and Packaging Co in HCM City. SMEs are unable to borrow although banks want to lend more, because of depreciation of their mortgaged assets.
Attendees said firms could be divided into three groups: competitive ones that all banks want to lend to; small- and medium-sized enterprises (SMEs) that are in debt but would recover; and the hopeless ones.
"The second group should be rescued and economy can fully recover after that," Tran Du Lich, deputy head of the lawmakers' delegation was quoted as saying by Tuoi Tre (Youth) newspaper.
But Phan Huy Khang, general director of Sacombank, said: "It is hard to define which companies are in the second group. We have to seriously consider many cases but dare not to lend because their assets are not enough to guarantee their loans and their project is unprofitable."
He said in the context that lending for aquaculture and cultivation in the Mekong Delta has fallen sharply due to high risks.
An Agribank executive, concurring with Khang, said many firms would perish without bank credit, but banks cannot provide money for all of them.
Besides, [the second] group cannot fulfill borrowing requirements, and lending to them would be very risky, he said.
Do Minh Toan, general director of ACB, said SMEs were unable to borrow despite the fact that banks would like to lend more to them because of depreciation of their mortgaged assets and lack of others.
Banks want to lend badly but they have tightened lending norms after many firms failed to manage their funds well and got into difficulties.
"We don't ask for a perfect score," Do Duy Hung, general director of Viet Capital, said.
"[Even] if enterprises can get 6-7 points, we are eager to lend and at the rate of 11 per cent. We will not have much profit but we would rather lend than sit on cash."
Selling assets mortgaged against bad loans is another challenge. Loan contracts stipulate that banks have the right to sell mortgaged assets, but in practice they can do nothing if customers fail to sign off at the time of sale.
"In many cases, principal and interest exceed the value of mortgaged assets, and banks have to go to court," one executive said.
"It takes a very long time, some cases go on for two or three years."
Borrowers use many other tricks to prolong the case.
The State Bank of Viet Nam's HCM City office said at the meeting that as of March end VND3.5 trillion (US$170 million) worth of bad loans had been recovered [or sold to the Viet Nam Asset Management Company].
The total bad loans in the city are worth VND46.4 trillion ($2.2 billion), or nearly 5 per cent of outstanding loans, and VND77 trillion worth of assets have been mortgaged against them.
Last update 10:00 | 16/05/2014
VietNamNet Bridge – While the crumbling roads of Vietnam must bear the burden of high traffic and excessive loads, railways and waterways go largely under utilized.
Road transport still preferable
According to Bui Danh Lien, Chair of the Hanoi Transport Association, at least 50 percent of the total of transported goods is carried by land. Meanwhile, two percent is carried by railway and 30 percent of goods, mostly imports and exports, by sea.
Lien noted that the majority of goods owners still prefer road transport, even though the transport fees increased sharply after the Ministry of Transport began tightening inspections of the loads of trucks rolling on the highways.
In principle, it is cheapest to have goods carried by sea transport. However, it is also the slowest, taking many days to carry goods to destination points. Goods owners generally wish to see goods arrive as soon as possible.
Railway freight ratesare a little bit lower than road transport fees. However, when all factors are considered, including additional transport time, it actually costs enterprises more to have goods carried by rail.
While the road transport fee is the highest, it remains the most favored by goods owners, because this can satisfy their requirements, especially in terms of delivery time. Goods owners can take the initiative with their production and business plans, because goods can be carried under all weather conditions.
Pham The Tran, Deputy General Director of NS Bluescope Vietnam, a structural steel manufacturer, said the company uses both road and waterway transport to take full advantage of them. Goods are carried from the company’s storehouses to customers by land, while they are carried from the mill’s storehouses to the company’s storehouses in the northern and central regions by waterway.
Railways only serve passengers?
A senior executive of a farm produce trading company said he never thinks of carrying goods by rail.“We have to have our goods delivered on time to ensure their freshness,” he said. “With the current procedure applied by Vietnam Railways, farm produce would rot before it arrived”.
Vietnam Railways has put into operation a cold container carriage, but the service cannot satisfy most customers’ requirements.
It takes 2 days and 3 nights to carry farm and seafood produce by land from southern provinces to Lang Son Province in the north. Meanwhile, it takes 6-7 days to carry products by rail from Song Than Railway Station in Binh Duong Province to Giap Bat Station in Hanoi. Moreover, goods owners must pay more money to transport goods by rail from Hanoi to Lang Son.
Dang Quoc Hung, Director of Kim Boi Wooden Furniture Company, affirmed that he would rather pay more to have his goods carried by land.“I never think of railways as a good means of transport. It is too costly in terms of both money and time,” he said.
Meanwhile, Do Duy Thai from Viet Steel complained that the company has had to raise its selling prices in some distant markets, because the road transport fee has increased by twofold since April.
Last update 14:00 | 12/05/2014
VietNamNet Bridge – “Say No to Chinese Goods” campaigns have been launched on many fanpages and social networks following the recent Chinese provocations in the East Sea.
Vietnamese, who are becoming increasingly enraged over China’s illegal deployment of a drilling rig and military vessels in Vietnamese territorial waters, are tending to turn their backs on Chinese goods.
“If you are Vietnamese, you must not buy, use or trade Chinese goods,” a netizen wrote on a forum for the youth.
Thousands of young people have responded to the call. Nguyen Khanh Toan, a member of the forum, said that in fact, many Vietnamese have been refusing Chinese goods for the last several years already.
For many Vietnamese, the term “Chinese goods” has long meant products of low quality, and often outright toxic. On top of that, Chinese businessmen have earned a reputation for swindling Vietnamese farmers.
Ngoc Hien, a teacher from An Giang Province wrote that, though his income is modest, he intends never to buy Chinese goods, even though they are much cheaper than Vietnamese goods or imports.
“Chinese businessmen are too cunning, while Chinese goods are dirty and unsafe,” he said.
Some members of the forum, however, said they fear the “Say No to Chinese Goods” campaign cannot produce meaningful results because of the flooding of Chinese goods in the Vietnamese market.
“Mismanagement is paving the way for smuggled Chinese goods to penetrate the home market. Meanwhile, Vietnamese people with low income have to use Chinese goods even though they themselves don’t want to,” commented Khanh Hien from Tien Giang Province.
However, the majority of the young people do not agree with Hien. Hanh Le, a student of the Hanoi National University, said the products available in Vietnam are diversified enough for different groups of customers.
“High income earners, for example, can use foreign made products, while Vietnamese goods should be a good choice for low income earners,” Le said. “You can also consider the products bearing South Korean and Japanese brands and made in Vietnam, which are much cheaper than the imports of the same kinds”.
“We have a lot of non-China choices,” Tuan Anh, a civil engineer, said. “If you still prefer imports, you can buy imports from South Korea, Thailand and Indonesia, which are getting cheaper thanks to the free trade agreements”.
A recent survey conducted by the Central Propaganda Committee has found that 59 percent of Vietnamese consumers “prioritize to buy Vietnamese”, 38 percent “advise their relatives and friends to buy Vietnamese”, while 36 percent said they previously prioritized to buy import products, but now tend to buy Vietnamese instead.
Thanh Hang, an office worker in Cau Giay District in Hanoi, said about 30 percent of the household appliances in her home are from China. However, she is starting to cut down on her spending on Chinese goods, especially toys, which have been found to contain toxins.
“Chinese goods have been boycotted all over the world,” she explained. “Why don’t we use Vietnamese goods if they are really better than Chinese?” she questioned.
Last update 07:50 | 12/05/2014
VietNamNet Bridge - Tax obligations often significantly burden businesses operating in Vietnam. To maximize profit, companies often seek out ways to avoid mandatory tax payments. Vietnamese law enforcement is beginning to vigorously monitor and prosecute acts of tax evasion or tax fraud.
Acts of Tax Evasion or Tax Fraud
The following acts are considered tax evasion:
1. Failure to file for tax registration; failure to file a tax declaration; filing a tax declaration more than 90 days after the filing deadline or the filing extension deadline;
2. Failure to properly record any revenue included in the taxable income calculation;
3. Failure to issue invoices upon selling goods or services, or recording lower values than the actually paid values of goods or services;
4. Using unlawful invoices or vouchers for accounting costs of goods or input materials in operations that give rise to tax liability, with the intend to reduce payable tax amount; increase the exempted or reduced tax amount or increase the creditable or refundable tax amount;
5. Using other unlawful vouchers or documents to incorrectly calculate payable tax amount or refundable tax amount;
6. Failure to file additional declarations where previous declarations are inconsistent with the actual exported or imported goods within sixty days after the customs declaration is registered;
7. Intentionally failing to declare or making incorrect declarations of customs duties;
8. Colluding with goods consignors to evade duties on imported goods;
9. Using duty-free goods for improper purposes without declaring duty.
Once detected by the Vietnam Government, the enterprise evading tax will face tax arrears and become disqualified for tax incentives.
If a corporation committing acts of tax evasion shows any criminal signs, that corporation and its legal representative are subject to the following punishments:
1. Offenders shall be imposed a fine of between 1 and 5 times the evaded tax amount or be subject to non-custodial reform for up to 2 years if:
• evading tax amounts of between 100 million and under 300 million VND or ;
• evading tax amounts of under 100 million VND but have been administratively sanctioned for acts of tax evasion or;
• having been sentenced for this crime or;
• having been sentenced for one of the crimes specified in Articles 153 through 160, 164, 193 through 196, 230, 232, 233, 236 and 238 of the Criminal Code, have not yet had such criminal record cleared but commit recidivism.
2. Offenders shall be subject to a fine of between 1 and 5 times the evaded tax amount or subject to a prison term of between 6 months and 3 years if:
• evading tax in the amount of between 300 million VND and under 600 million VND or;
• committing recidivism.
3. Offenders shall be sentenced to between 2 and 7 years if:
• evading a tax amount of 600 million VND or higher, or
• evading a tax amount of between 300 million VND and less than 600 million dong and concurrently conduct one of the following acts: offering bribes; resisting or inflicting injury on persons in the performance of their official duties; destroying property of tax administration agencies, tax administration civil servants and other state agencies with responsibilities in tax administration execution provided that such act does not constitute a crime. In case where such act constitutes a crime, apart from tax evasion, the offender is also prosecuted for criminal liabilities on corresponding crime.
4. Aside from the above mentioned punishments, offenders may also be imposed a fine of between 1 and 3 times the evaded tax amount.
PLF - LAW FIRM
VietNamNet Bridge - Vietnam Gas Corporation (PetroVietnam Gas) and the Vietnam Industrial and Commercial Bank (VietinBank) are Vietnamese’s two representatives of the top 2,000 largest enterprises in the world this year.
Forbes magazine recently published the Global 2000 list, including the largest and most powerful companies in the world. The list was compiled based on criteria relating to revenue, profits, assets and market value.
Of the two Vietnamese companies to make the list, PetroVietnam Gas is ranked 1,651st, with revenues of $3.1 billion and a market value of $7.5 billion. VietinBank is ranked 1,854th, with $2.3 billion in revenue and $2.9 billion in market value. For the prior two years, VietinBank was the sole representative of Vietnam in the Global 2000, with the ranks of 1,989th and 1,764th.
This year the Global 2000 has representatives from 62 countries. In total, these firms have a turnover of $38 trillion of revenue, $3 trillion of profit, $161 trillion in assets and $44 trillion of market value. The number of employees is 90 million worldwide. All figures are up from last year.
This is also the first time China owns the world's three largest companies and has 5 representatives in the top 10. All three leading names are banks – the Industrial and Commercial Bank of China (ICBC), China Construction Bank (CCB) and the Agricultural Bank of China (ABC).
The remaining 5 spots of the top 10 are occupied by American firms, including J.P. Morgan and Berkshire Hathaway. The two European firms in the top 10 last year - Royal Dutch Shell and HSBC, did not make the top ten this year.
The financial and banking sector still dominates the list with 467 representatives, followed by the oil and gas sector (125), insurance and electricity-water.