Vietnam Economy Forum

[Viet]

There's something I'm always curious about. Whenever I watch the vietnamese channels on TV showing what Vietnamese do on their daily lives, it seems like a large number of people still do trade in the free market (like selling food on boats) where no tax is collected. Does that have a negative effect on the economy?

in theory, all must pay personal income tax. The tax rate begins progressively with 5% and ends at 35%. But I guess the majority of small businesses don´t pay income tax as they earn too litle. The government collects less money, but it is good for the small businesses.

Vietnam Personal Income Tax

 

[Viet]

look this Annam race, what does the date have to with anything, did you suddenly achieve a trade surplus in last 3 years with Chinese, the point is in 2015 your dumbazz VCP open up to ASEAN-China and you are going to get fawked and still you want TPP, I think in international division of labour if you are happy for your country to be home of low value added cheap manufacturing slave of foreigner then good job

here another more recent article for you


what a sick race, become more and more ridiculous everyday

what race are you? can´t you stop trolling for a while and contribute something meaningful, you retard?

For expample, the article you posted previously was from 2008 with export of US$63 billion. This year Vietnam economy expects to see US$130 bn in export, with ZERO or small trade deficit (although trade deficit with China is widening).

 

[yue10]

there you go again with your vicious mentality, I think maybe your parents did not raise you well

i am the race came from superior Southern Viet parents unlike the evil and disgusting North people ok, your race is sick, until I saw improvement in mentality then I will keep trolling the Annams

I speak about your nonsense statistic mentality later but here nice article

Vietnam Empty Office Towers Show Dreams Turned to Rubble
From afar, the gleaming metal and glass edifices of Hanoi’s EVN Tower illustrate Vietnam’s rapid economic development. Up close, the rubble-strewn entrance and missing windows tell another story: one of loose lending and property speculation that now hangs over the country’s banks.

State-run monopoly Vietnam Electricity began construction of the 33- and 29- story dual-tower development in 2007, a year when 54 percent credit growth helped fuel the fastest economic expansion since 1996. Now, the economy has slowed, banks are struggling with an increase in bad debts, and unfinished property projects, empty offices and lower rents risk adding to the pile of non-performing loans.
“Banks were far too eager to lend and a lot of the projects that have been built haven’t been well-thought through,” said Stephen Wyatt, managing director for real estate broker Knight Frank Vietnam in Ho Chi Minh City. “A number of developments are on hold, purely because they have run out of funding. Banks are no longer willing to fund these massive developments.”
Vietnam’s economy, which the communist government opened up in 1986, expanded at a 4.7 percent annual rate in the third quarter, after exceeding 7 percent from 2002 through to the first quarter of 2008. After a lending binge fueled the fastest inflation in Asia, policy makers raised interest rates in 2010 and 2011, and restricted lending. Among the casualties are many of the nation’s inefficient state-owned enterprises, which had diverted cash to property developments.
“When the developer is a state-owned enterprise and is using the money it should be using for say, power generation, airlines, shipping or banking, that’s where the oversupply has come,” said Marc Townsend, the Ho Chi Minh City-based managing director of CBRE Group Inc.’s Vietnam unit. “They all felt they could make easy money by being a property developer.”
Property Investments
State firms’ so-called non-core investments, such as property and stocks, account for as much as 12 percent of their registered capital, Deputy State Auditor Le Minh Khai said in July. The Communist Party’s Central Committee on Oct. 15 called on state-owned enterprises to end non-core investments.
Office and retail rents in Vietnam’s two largest cities have slumped as a wave of supply entered the market at a time when slowing economic and retail-sales growth curbs demand for commercial real estate. The Hanoi market added more office and retail space since the start of 2011 than in the previous four years combined, according to property broker CBRE.
The average asking rent for top-grade central business district office space in Hanoi was about $47 per square meter per month in 2009, more than double the levels for the same grade space in Bangkok and Kuala Lumpur at that time, according to data from the Vietnam unit of Los Angeles-based CBRE. The rate was 11 percent lower at $42.01 per square meter in the third quarter.
Rents Plunge
Average asking rents for Grade B office space in the capital’s western district, where some of the nation’s largest state-owned enterprises have their headquarters, have fallen 39 percent since the first quarter of 2009, and slid 22 percent in the city’s central business district, according to the data.
“I have never seen rents decline this fast in the market,” said Son Nam Nguyen, managing partner at Vietnam Capital Partners, an investment bank in Ho Chi Minh City. “If real estate rents and values continue to decrease as we’ve seen in the past three months and six months, the biggest risk is we will see developers walk away from projects and banks’ bad assets will increase very rapidly.”
Bad Debt
Real estate loans totaled 203 trillion dong ($9.7 billion) as of Aug. 31, of which 6.6 percent were classified as bad debt, Minister of Construction Trinh Dinh Dung told the National Assembly on Oct. 31, citing a State Bank of Vietnam report. A broader category of real estate-related loans, including property-backed debt, account for 57 percent of total outstanding borrowing, or about 1,000 trillion dong, he said.
Average office occupancy in Hanoi fell 2 percentage points to 79 percent in the third quarter from the previous three-month period, according to data from property broker Savills Plc, while average rents dropped 4 percent. The number of new leases signed in the period slid to the lowest this year.
Office occupancy rates in Ho Chi Minh City, the country’s commercial hub, rose 1 percentage point to 87 percent in the third quarter from three months earlier, while average monthly rents fell 2 percent to about 540,000 dong per square meter from the April-June period, with almost a quarter of buildings lowering their rates, according to Savills.
Almost 16 percent of available Hanoi retail space was vacant at the end of the third quarter, according to CBRE, with most free space to be found in the capital’s shopping centers, which had an occupancy rate of 82 percent.
Fringe Areas
“Newer projects, especially those in fringe areas, are expected to experience a rather difficult time in the first two or three years, due to fiercer competition and limited consumer spending that might linger on,” CBRE said in its third-quarter review of the Hanoi market. Almost 650,000 square meters (7 million square feet) of retail space is expected to enter Hanoi from the end of the third quarter until the end of 2013, adding pressure on existing projects, it said.
Retail-sales growth slowed to 17.1 percent year-on-year in October compared with the same period in 2011, the lowest level of expansion since at least January 2005.
The economic slowdown has weighed on the country’s stock market, with the benchmark VN Index, Asia’s worst performer in 2011, down 23 percent since its peak this year on May 8. The index fell 1 percent today.
Risks ‘Understated’
Many of Vietnam’s 1,300 state-owned enterprises are reportedly facing losses because of their recent forays into property, said Alfred Chan, director of financial institutions at Fitch Ratings in Singapore.
“It is not obvious, if you were just to look at the disclosure, what the potential risks to the banking sector are if you just look at the real estate sector,” Chan said. “Some of this exposure could well come from non-real estate companies that have ventured into that sector.”
Non-performing loans at banks are “significantly understated” and could be three or four times higher than official estimates, Fitch Ratings said in a March report.
The central bank chief, Nguyen Van Binh, said in April the level of bad debt at some lenders may be “much higher” than reported. Bad debts in Vietnam’s banking system may have accounted for 8.82 percent of outstanding loans at the end of September, Nguyen Van Giau, head of the National Assembly’s economic committee, told legislators in Hanoi Nov. 13.
Deserted Tower
Office rents may decline by as much as another 15 percent in the next three years, said CBRE’s Townsend, particularly if economic growth remains subdued and direct foreign investment fails to recover. Pledged foreign-direct investment fell 25 percent from a year earlier in the first 10 months of 2012, the Foreign Investment Agency said on its website Oct. 25.
On the bank of Ho Chi Minh City’s Saigon River, the construction site for the 40-story Saigon M&C Tower is deserted except for two security guards.
The $200 million project -- a joint venture between Saigontourist Holding Company, M&C Joint Stock Company, Dong A Commercial Joint Stock Bank and Dong A Bank Securities Co. -- broke ground in 2007 and was due to be completed in 2010, according to Saigontourist’s website. Today, ropes dangle from the first six floors, originally designed to incorporate a 23,000-square-meter commercial space, while glass paneling is incomplete on the remaining floors.
“A lot of these developments were conceived and built in an incredibly good market,” said Knight Frank’s Wyatt. “That market is all but gone.”

this is what happen when a race is pathetic never think about their people but just greedy and focus on statistic, misallocate capital channelling it into ridiculous project so they could show off a nice skyline

 

[visom]

there you go again with your vicious mentality, I think maybe your parents did not raise you well

i am the race came from superior Southern Viet parents unlike the evil and disgusting North people ok, your race is sick, until I saw improvement in mentality then I will keep trolling the Annams

I speak about your nonsense statistic mentality later but here nice article


this is what happen when a race is pathetic never think about their people but just greedy and focus on statistic, misallocate capital channelling it into ridiculous project so they could show off a nice skyline

If you really are Vietnamese, then why don't you actually do something productive to benefit Vietnam so you can be proud to be a Vietnamese, rather than just talking shit about your own country?

 

[yue10]

If you really are Vietnamese, then why don't you actually do something productive to benefit Vietnam so you can be proud to be a Vietnamese, rather than just talking shit about your own country?

who said I did not like your country, it is your Annam race that did not respect their own people think everything is backwards, that is why your race will always be inferior, anyways I am just a grain of sand on the beach not important so no need to be productive ok

 

[EastSea]

@visom, @viet+: he is Khmer Rouge, ignore him, let him troll alone with himself.

 

[Viet]

Vietnam signs nuclear deal with Britain

Updated : 11/29/2013 9:40:52 AM
source: Voice of Vietnam

Vietnam's Minister of Science and Technology and the British Embassy signed a memorandum of understanding on co-operation in peaceful use of nuclear energy on November 28.

The memorandum constitutes efforts from both sides to address the challenges of meeting growing energy demand.

Under the framework of the memorandum, the two countries will focus on exchanging scientific and technical information and documentation.

They will also co-operate on regulatory frameworks, personnel training, research and development for civil power plants' cores as well as improving management of waste and spent fuel.

"Vietnam is only embarking on its nuclear power programme. Therefore, it is particularly important for the country to learn from the knowledge and experience of a country such as Britain, which has successfully acquired extensive experience and technology in the area of peaceful nuclear energy," said Deputy Minister of Science and Technology Le Dinh Tien.

Deputy Minister Tien also said that the memorandum would be an important framework for the expansion of future co-operation in peaceful use of nuclear energy between the two ministries of science and technology.

British Ambassador to Vietnam Antony Stokes said the signing of this MoU confirmed Britain's intention to share its expertise with Vietnam.

Vietnamese and British governments signed a Joint Declaration on Strategic Partnership in 2010, in which science and technology is one of the priorities.

 

[Viet]

GE opens its ‘Vietnam Engineering Centre’


08:00 | 28/11/2013
source: VIR

GE yesterday announced the official start of operations of its Vietnam Engineering Centre, coinciding with the company’s 20th year of operations in the country.

This is the second centre of its kind to be launched by GE in Asia and serves as an affirmation of the company’s commitment to the long-term development of the Vietnam economy through building local capability and resources.

 

[Viet]

South Korea’s Orientech to open factory in Vinh Phuc next April



15:00 | 22/11/2013
source: VIR

South Korean Dongyang Electronics Vietnam’s Orientech factory in the northern Vinh Phuc province will start operations in April next year.

Head of the Investment Office under the Vinh Phuc Provincial Industrial Parks Management Authority told VIR last week that the $10 million facility, once working, “will recruit 2,500 local workers and contribute $300,000 a year in tax revenues.”

Quynh added that the factory specialises in producing electronics components such as chargers, accelerometers, rectifiers, and data sources for Samsung mobile phones.

 

[Minjitta]

@visom, @viet+: he is Khmer Rouge, ignore him, let him troll alone with himself.

he is ungraceful being so just ignore Yue10 and WholeGrain.

 

[Viet]

@visom, @viet+: he is Khmer Rouge, ignore him, let him troll alone with himself.

no worry, I like to slap him on the face.

 

[visom]

I am just a grain of sand on the beach not important so no need to be productive ok

good point, exactly, now get out, no one takes you seriously

 

[Viet]

US$400 mil tyre factory inaugurated in Tay Ninh

Updated : 12/1/2013 1:16:57 PM
source: VOV

(VOV) - November 30 saw the opening of Chinese company, Sailun Tires Co, Ltd, in Phuoc Dong-Boi Loi Industrial Park in the southern province of Tay Ninh.

The US$400 million factory to produce steel radial and semi-steel radial tyres in the province was licensed in 2011, on an area of 60 hectares, in the Phuoc Dong-Boi Loi IP and is the largest foreign-invested company in Tay Ninh to date.

The production plant has a design capacity of 150,000 tyres per year and is expected to generate some 1,000 jobs.

 

[Viet]

Slovakia’s BTG Holding builds biggest beer factory

• Updated : 11/30/2013 12:53:37 PM

• source: VOV

(VOV) - The SlovakianBTG Holding Group began constructing a beer factory and thermal power plant on November 29 in Hoa Binh province’s Lac Thinh Industrial Park.

Lac Thinh Industrial Park, in Yen Thuy district, covers 220 hectares and has total investments exceeding EUR45 million. Its modern, high quality infrastructure includes a hotel, accommodation for managers and workers, customs and banking agencies, post offices, sports and recreational facilities, and medical centres.

Its first two licensed projects are BTG Holding Group’s Slovak beer factory and thermal power plant.

The EUR86 million beer factory will produce the internationally renowned beer label Budweiser Budvar at an annual capacity of 190 million litres. The beer factory will be Slovakia’s biggest in Asia once fully operational, and will export its products to regional markets such as the Republic of Korea, Japan, and China. The factory is expected to begin operations in November 2015, generating 2,000 new jobs.

The thermal power plant will supply electricity to all the industrial park’s factories. BTG Holding Group has committed to meet EU waste discharge, environmental protection and renewable fuel standards. The plant construction project is at a total cost of more than EUR100 million.

 

[yue10]

he is ungraceful being so just ignore Yue10 and WholeGrain.

you can ignore all you like I will just stop speaking and now just posting article


EU trade deal threatens Vietnam’s uncompetitive firms
While Vietnam hopes to boost exports and attract more foreign investment by signing a free trade agreement it is now negotiating with the European Union, the flip side is that the removal of tax and non-tax barriers could hurt its businesses, which are barely prepared for the fierce competition international integration would bring.
“Vietnamese firms may lose even at home since many EU industrial and service products have competitive advantages,” Nguyen Van Nam, former director of the Trade Research Institute, said.
The deal will eliminate tariffs on 90 percent of Vietnamese goods, and cut by 10-20 percentage points the average import tax on the remaining 10 percent, which is at 4.1 percent now.
Vietnamese exporters pay high duties on certain popular items - 11.7 percent on garments, 10.8 percent on seafood, and 12.4 percent on footwear.
The lower tariffs would make EU products cheaper in Vietnam, forcing many domestic firms to reduce or even stop production, he warned.
Industries which could be most seriously hurt include meat and animal-feed manufacture, he said.
“While negotiating FTAs with foreign partners, Vietnam should have prepared for the competition. But it has never done so.”
Vietnam and the EU held the fifth round of talks on the FTA early this month, discussing reform of the former’s economy for healthier competition, focusing on building a level playing field for state and private firms, intellectual property protection, regulations on origins of products, and sustainable development.
The FTA is expected to be finalized by the end of 2014 after the EU parliamentary election in the middle of the year.
Nam said local firms failed to capitalize on the opportunities that arose from WTO accession and the bilateral trade agreement with the US, but were in fact adversely affected.
Vietnam’s annual average GDP growth in five years before WTO membership in 2007 was 7.2 percent, much higher than the 6.2 percent in the next five years, he said.
“If Vietnamese firms do not improve their management and technologies and restructure production in the next one or two years, many of them, under the pressure of cheap imports from the EU, will face bankruptcy.”
Nguyen Van Tuan, deputy general secretary of the Vietnam Apparel andTextile Association, said local firms would be unable to make use of the tax reductions by the EU due to its stringent conditions with regard to certificates of origins for materials.
Vietnam’s garment industry mainly imports feedstock from China, Taiwan, and South Korea, so local producers would not be able meet the EU’s stipulation that exported garments should use materials of local origin, he said.
Vietnamese firms would not much benefit from the tariff cuts since most of them export products made under outsourcing contracts with foreign partners, he said.
“Few Vietnamese firms can complete the business cycle from designing and producing products to exporting them.”
The same situation exists in the footwear industry since 70 percent of its exports are done under outsourcing contracts, a spokesperson for the Leather and Footwear Association said.
Vietnamese footwear firms could also face fierce competition in the EU from more sophisticated producers like Singapore, Malaysia, and Thailand with whom the EU is having FTA negotiations.
Vietnam’s main exports to the EU are farm produce, textiles and garments, footwear, and wood products.
Hope
According to a recent study by the EU’s Multilateral Trade-related Assistance Program (Mutrap), the FTA will increase exports of major Vietnamese products to the EU by 10-20 percent.
Nguyen Ton Quyen, general secretary of the Vietnam Timber and Forest Product Association (Vifores), said the FTA would help boost exports.
Vietnamese wood products are exempt from tariffs under the Generalized System of Preferences, and this would remain unchanged, he said. On the other hand, the FTA would help attract more foreign investors coming with more advanced technologies, capital, and expertise to the country, which would help the sector increase its production capacity and exports, he said.
Wood producers can also import machines and equipment at lower cost, helping improve their competitiveness, he added.
The EU Union became Vietnam’s biggest export market last year after shipments increased by more than a fifth to US$20.3 billion, or 17.7 percent of the country’s entire exports, according to the General Statistics Office