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SEIKO IDEAS CORPORATION
Vietnam Business Review
BUSINESS REVIEW
Vol 44, November 12th 2014
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INSIDE THIS ISSUE
Highlight
APEC leaders emphasize regional economic connectivity
Vietnam pushes for wide-ranging TPP deal
Vietnam mulls extra int’l bond issue
Economy
Support industry to receive tax cuts
Banks & Finance
Banks willing to give home loans: BIDV head
Investment
Real estate sector draws foreign investors
Samsung invests $3b more in Vietnam
Enterprises
Dairy firms told to spend less on advertising
Mondelez to buy 80% of Kinh Do’s snack business
Market & Prices
Petrol price cut for 9th time: How will Vietnam cope with?
Luxury car market booming
Legal Updates
New tax policy to come into force on Nov 15, 2014
Guiding the opening of payment accounts of banks
Procedures and conditions for the destruction of processing raw materials
in Vietnam
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1
ECONOMY
Support industry to receive tax
cent against initial capacity, and if
future, thanks to the presence of
cuts
the value of their fixed assets grows
Samsung and Microsoft and the
by at least VND20 billion ($952,400)
new CIT incentives.
after coming into operation.
“Bac Ninh is trying to develop into a
One of the reasons behind this
modern city with many supporting
move is that in order to benefit from
industry firms and major businesses
agreements
like Samsung and Microsoft,” the
VIR
-
Businesses
engaging
in
supporting industries are expected
to receive major incentives under
an amendment to the existing Law
on Corporate Income Tax.
The National Assembly last week
discussed revisions to the country’s
tax laws. Under the draft revision of
the
current
Law
on
Corporate
Income Tax, businesses operating in
supporting industries will for the first
time
benefit
from
corporate
income tax (CIT) incentives.
Specifically, those with new projects
will enjoy a 10 per cent CIT for the
first 15 years of operations with a CIT
exemption for the next four years,
and a 50 per cent CIT reduction
over the next nine years during this
period.
According to the draft, products
benefiting from the reduced CIT will
be from the electronics, automobile,
garment and textile, and footwear
sectors. The list of products for
supporting
industries
will
be
detailed by the government.
Regarding
expanded
projects
within the list, investors will enjoy
such
incentives
if
their
project
design capacity increases 20 per
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like
Trans-Pacific
Partnership, Vietnam-Europe Free
source said.
Trade Agreement and Vietnam-
However,
South Korea Free Trade Agreement,
there remained a big gap between
Vietnam’s exports must have at
the enactment of the CIT incentives
least
and the application of them to
60-65
per
cent
of
their
according
to
Duong,
materials made in Vietnam.
enterprises.
“It’s very good news for firms like us,”
“Vietnam
said
Duong,
develop its supporting industries if it
Chinese-
fails to create a level playing field
Vietnamese joint venture Dragon
for firms and remove obstacles
Automobile
Limited,
facing firms. For instance, firms
“because we will put our $50m
can’t make profits when interest
project into operation soon and will
rates are current at 12.5 per cent,”
be able to seek more local suppliers
he added.
easier, instead of largely importing
For
products
operations
Nguyen
representative
Tai
of
the
Company
from
China
&
Japan.”
Dragon
will
not
example,
in
be
since
able
it
Vietnam
to
began
in
2009,
Samsung is entitled to a 10 per cent
will
CIT exemption for the first four years
manufacture, assemble and import
of operations and a 50 per cent
assorted vehicles in the northern
reduction for another nine years.
province of Lang Son.
According to the Ministry of Industry
A
source
Automobile
from
the
Bac
Ninh
and Trade, Vietnam has only 656
Provincial People’s Committee said
enterprises
making
spare
more foreign supporting industry
Meanwhile, there are over 58,000
firms were expected to come to do
enterprises
business in the province in the near
industrial sectors.
operating
in
parts.
various
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BANKS & FINANCE
Banks willing to give home
clarified that the loans for house
prices of the primary segment rose
loans: BIDV head
repair and leasing account for 40
by two to three per cent. As of the
per cent of their total debt balance
end
in the real-estate sector, according
inventory was worth VND83 trillion
to Luc.
($3.9 billion), a 13 per cent fall
In
addition,
considered
sectors.
the
to
influence
other
property
against the corresponding period
last year.
continue to pour money into the
seen positive signs because of the
Banks are ready to give loans to
industry, as only a push from banks
improved
property projects, said Can Van
will improve the real estate sector.
VND30-trillion ($1.4 billion) credit
Luc, deputy general director of the
Statistics from the central bank
package.
Bank
showed that by the end of 2013,
In addition, both investors and
Investment of Viet Nam (BIDV).
the total debt balance in the
home buyers thought that it was
He added that giving loans to real
property market was VND262 trillion
the right time to buy a house. Some
estate and the security sector was
(US$12.4
for
investors reduced the selling prices
more risky than consumption or
eight per cent of the total debt
by 30 to 40 per cent with marketing
production loans. The indicators in
balance.
strategies and by reducing the
the first two sectors were extremely
By the end of September, the debt
scale of the apartments.
sensitive to
the economy, with
balance in the country's real-estate
Le Xuan Nghia, member of the
frequent changes taking place. The
sector rose 11.5 per cent over the
National
State Bank of VN clarified that the
end of last year. Of this, loans for
Monetary Policy, said that property
risk rate in these sectors was 2.5
buying houses or for house repair
had been a potential sector for
times higher than of normal loans.
work
banks
"However, risks are often linked to
component
high
followed
profits,
making
and
banks
billion),
comprised
by
with
banks
the
He added that the market had
Development
why
is
August,
will
for
That's
market
of
accounting
the
26
highest
per
investment
cent,
in
the
economy
Advisory
to
and
the
Council
promote
their
for
credit
growth.
Credit inflows into the sector will be
interested in such loans”.
property sector with 17 per cent.
higher, especially in lending for
Luc said that the rate of loans in the
In the first nine months of the year,
apartment
property sector was more than
the apartment segment saw the
ongoing construction projects and
eight per cent, and the figure had
best sales. About 6,800 apartments
houses
fallen over the previous years.
were sold in Ha Noi in the nine-
districts.
The rate is expected to increase in
month period, higher
the near future, as banks have
whole of last year. In HCM City, the
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than
in
building
the
projects,
capital's
interior
the
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3
INVESTMENT
Real
estate
sector
draws
foreign investors
VNS - The domestic property market
continues to lure foreign investors
even though it has yet to fully
recover, experts say.
According
to
the
Ministry
of
Planning and Investment's Foreign
Investment Agency (FIA), in the first
10 months of 2014, the real estate
sector
attracted
investments
(FDI)
foreign
worth
direct
US$1.22
billion or 8.9% of the total amount of
The sector has the second largest
FDI volume in the first 10 months
the
Hoang Xuan Hoa of the Party
Tu TaiChinh newspaper.
Central
FDI had yet to be channelled to
Commission said the State should
affordable social housing projects
improve FDI quality by refusing to
that have high demand in the
grant
domestic
projects using old technology and
market.
Meanwhile,
investment
agriculture, a key economic sector,
with
accounted
impact.
for
0.5%
of
total
Committee's
a
negative
Economic
licenses
to
environmental
national FDI capital in the past
For the property sector, the State
three years, the agency noted.
should encourage investment in
Phan
Huu
Thang,
former
FIA
projects on urban development,
director, said the domestic property
technological infrastructure, social
market had yet to recover, but
housing
foreign
apartments for low-income citizens,
investors
had
found
opportunities during difficult times
because
the
property
market
continued to develop.
Foreign
investors
placed
their
development
and
Hoa added.
Samsung invests $3b more in
Vietnam
money in the domestic property
market in preparation for its future
FDI in Viet Nam.
after
capital, reported the Sai Gon Dau
processing
and
manufacturing industry, the agency
revealed.
In fact, many existing FDI golf resorts
and large urban regional projects
that were granted licences with
large capital in previous years have
yet to be built or have cancelled
construction because of numerous
difficulties in disbursing investment
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recovery, Thang observed.
Pham Sy Liem, deputy chairman of
the Viet Nam Federation of Civil
Engineering Association, said the
state should have a mechanism for
Wall
granting and revoking investment
Electronics Co. plans to invest up to
licenses to ensure efficient property
$3 billion to expand mobile-phone
project management.
production in Vietnam, one of the
The
State
should
craft
and
Street
company’s
Journal
boldest
Samsung
moves
combat
ordinate
who are eating into its smartphone
investing
capital in sectors, he added.
in
Chinese
to
implement policies urging FDI to cowhenever
low-cost
-
rivals
business.
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INVESTMENT
The
expansion
could
division fell to 7% from 16% in the
Samsung is one of many South
capacity significantly at Samsung’s
second quarter.
Korean conglomerates
newest mobile-phone factory in
Samsung is responding by shifting
shifting
Vietnam,
more
China to countries such as Vietnam.
pushing
boost
down
company’s
the
phone
manufacturing
to
production
that are
away
smartphone-
lower-cost sites such as near Hanoi,
Some
manufacturing costs and bolstering
where average monthly wages are
Korea’s recent
profit margins. The decision is the
a third those in Beijing, near another
China reflect the shift. As more
latest
Samsung
handset
Korean companies open assembly
manufacturing is joining the shift to
according
to
lower-wage locales from China—
government survey.
Korean parts makers are shipping
even as China and South Korea
The new Vietnam investment would
more to that region & less to China.
signed a free-trade pact Monday
expand
billion
Samsung’s announcement of its
that
handset manufacturing line that
investment in Vietnam came the
business between the countries.
Samsung
same day that South Korea signed
The
technology
northern Thai Nguyen province. It
the
company’s No. 1 market share in
would significantly boost Samsung’s
agreement
smartphones has eroded over the
already sizable smartphone-related
Korea’s trade minister said that the
past several months as companies
operations in the country. Samsung
pact mainly was aimed at helping
including
Inc.
has operated a $2.5 billion mobile-
smaller South Korean companies
and Lenovo Group Ltd. offer good-
phone plant since 2009 in northern
gain access to the Chinese market.
quality
Bac Ninh province and in July won
As mobile earnings sink, Samsung is
approval
spending
sign
was
that
South
aimed
South
at
Korean
China’s
phones
fostering
Xiaomi
for
Samsung’s
devices.
share
global
less
than
Samsung’s
Japanese
existing
opened
to
a
build
$2
in
a
March
$1
in
billion
low
exports
plants in Southeast
outline
of
with
big
South
to
Asia, South
a
free-trade
China.
to
South
increase
production
capacity
shipments fell to 25% in the third
smartphones and tablets.
semiconductors,
betting
quarter
Samsung said Monday that it was
scale will give it a leg up on its
according to research firm Strategy
completing
new
smaller rivals. Samsung said last
Analytics.
Vietnam investment and that it
month that it would invest $14.7b in
hurt
hadn’t set a timeline or size for the
a new semiconductor factory in
The
deal.
provincial
Pyeongtaek, about an hour’s drive
net
official confirmed that Samsung
south of Seoul, with operations to
profitfell by nearly half from a year
had applied for an investment
start in 2017. Samsung also operates
earlier. Operating profit in its mobile
license and
facilities for semiconductors and
from
sluggish
Samsung’s
31%
sales
smartphone
an
facility,
say
factory there to make displays for
The
of
Korean
economists
from
in
the
have
earnings.
company’s third-quarter
first,
A
approval.
www.seiko-ideas.com
details
of
Vietnamese
was
the
awaiting final
in
that
its
other hardware in Brazil and the U.S.
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5
ENTERPRISES
Dairy firms told to spend less
the age of six and Document
However, the ministry has asked
on advertising
6544/BTC-QLG on guidelines in the
localities
implementation
to
investigations on price registration
stabilise the prices of dairy products,
and publication to closely manage
companies and individuals trading
the businesses' input factors.
The finance ministry has asked dairy
companies to reduce spending on
advertising
and
marketing
to
enable them to lower retail prices.
The move comes amid a worldwide
reduction in the prices of some
imported dairy materials.
In
a
document
to
provincial
finance departments reviewing the
implementation
of
the
price
stabilisation of dairy products for
children under the age of six, the
ministry asked the departments to
continue conducting spot checks
on and registration of retail prices,
as well as the publishing of the
names
of
organisations
and
individuals selling the products.
All price violations will be strictly
punished.
Companies
and
individuals operating in the sector
are
required
to
report
their
wholesale and retail prices under
existing regulations, but the prices
should be no higher than registered
maximum prices.
According to the ministry's Decision
1079/QD-BTC dated May 20 on
measures to stabilise the prices of
dairy products for children under
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of
measures
in the sector will have to publish
their prices beginning November 30.
Nguyen Anh Tuan, head of the
to
conduct
regular
Mondelez to buy 80% of Kinh
Do’s snack business
management
Reuters - Mondelez Int’l Inc said on
the
customs
Tuesday it will pay $370m to buy an
declaration of some companies
80% stake in Vietnamese company
that imported a huge quantity of
Kinh Do Corp's snack business.
dairy products showed that the
Mondelez, based in Deerfield, Illinois,
prices remained the same.
already has a small presence in
Tuan added that from June to
Vietnam selling some of its Oreo,
September,
Ritz and Cadbury products.
ministry's
price
department,
said
the prices
of
most
imported dairy products remained
Mondelez will acquire two Kinh Do
the same except for full cream milk
manufacturing facilities, as well as
powder which fell by 2.57 per cent,
Kinh Do's distribution network.
skimmed milk powder which rose
The deal will allow Mondelez to
by 1.45 per cent, and whey powder
build scale. Kinh Do is Vietnam's
which rose by 19.52 per cent.
biggest
He
noted
that
none
of
the
confectionary
producer
and makes products such as Cosy
companies registered to reduce
biscuits and Solite soft cakes.
the prices of their dairy products for
Vietnam has a growing middle
children under the age of six in spite
class,
of the world price decrease for
population is under 30 years old,
such products.
presenting
In reality, the prices of imported
attract
dairy materials have yet to be
Mondelez products.
and
60
an
younger
percent
of
the
opportunity
to
generations
to
reduced and therefore had no
impact on domestic selling prices,
he explained.
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MARKET & PRICE
Petrol price cut for 9th time:
How will Vietnam cope with?
VNN - While the Ministry of Industry
and Trade (MOIT) is considering
possible measures to cope with
sharp falls in oil prices on the world
market, the government does not
plan to adjust the state budget
collection plan.
MOIT Minister Vu Huy Hoang told
the local press on the sidelines of
the
ongoing
session
that
National
the
Assembly
ministry
was
considering several scenarios to
and it is now hovering around $75-
be different at different times of the
cope with oil price fluctuations to
76 per barrel.
year, depending on world prices.
optimize profits from oil exports and
“With that price level, we make a
Forecasting is also done by other oil
petrol imports.
very modest profit,” Hoang said.
exporters.
Hoang said that crude oil prices
Hoang
two
As planned, the National Assembly
had recently fallen to very low
measures to cope with oil price
will discuss the 2015 budget in a few
levels. In principle, once the crude
fluctuations. First, it is necessary to
days. Phung Quoc Hien, chair of
oil price falls, the prices of finished
ensure oil storage. The government
the National Assembly’s Finance
products will also decrease, which
has instructed relevant ministries
and Budget Committee, admitted
means that consumers will be able
and
that the oil price decrease should
to buy petrol products at lower
production and export.
be considered when figuring out
prices. Seventy% of the products
If the oil price falls, Vietnam will cut
the budget.
consumed domestically are imports.
export volume, while it will export
Budget estimates submitted by the
However, he conceded that with
more when the price increases.
government
the oil price plunging Vietnam
“This is the best way for Vietnam to
Assembly
would earn less money from oil
both ensure energy security and
scenario with an estimated oil price
exports.
optimize profits,” he said.
of $100 per barrel, according to
In
2013,
the
oil
price
climbed to over $100 per barrel,
said
branches
Second,
there
to
Vietnam
were
regulate
will
have
oil
to
to
show
the
an
National
economic
Hien.
improve forecasting to determine
reasonable output. The output will
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MARKET & PRICE
“Therefore, if the oil price falls to $70,
in the first 10 months of 2014
market, including Porsche Macan,
this would affect the budget,” Hien
increased by 100% compared with
Peugeot RCZ and BMW M4 Coupe.
said, adding that oil exports make
the same period last year.
Domestic auto industry
up one-tenth of total state revenue.
All luxury car brands are available
According to the General Statistics
However, Hien said the government
in VN except for Ferrari & Bugatti.
Office (GSO), 51,000 cars worth a
has no intention of adjusting the
Vietnam’s
a
total of $1.18b have been imported
plan on state budget collection.
disproportionately high number of
to Vietnam this year. The figures
“If you check the oil prices in
luxury cars. In the first six months
were 34,500 & $709m, respectively,
previous years, you will see that
alone, three luxury brands, Infinity,
in the same period last year.
prices were always above $100 per
Jaguar
More & more cars are expected to
barrel,” he added.
launched on the local market.
come to VN in Nov & Dec, when
In 2014, Vietnam targets revenue of
Analysts believe that even super
the market begins its typical year-
VND80 trillion from crude oil.
luxury brands Ferrari and Aston
end high season.
Martin are eyeing the small but
The increasing number of imported
potential market, noting that luxury
cars could cause problems for
cars on Vietnam’s streets are as
domestic
numerous as some larger markets.
manufacturers, analysts warn. They
Bentley, which recently entered the
say that domestic manufacturers
market here, estimates that about
may consider stop making cars in
230 cars have been imported from
Vietnam, and instead import cars
the UK to Vietnam, at a price of
for domestic sale.
VNN - Luxury cars priced at tens of
nearly 10 billion of dong.
They said that from 2018, when
billions of dong continue to be
Meanwhile, Rolls Royce estimates
import tariffs will be cut to zero%
popular in Vietnam, where the
that about 100 cars have been sold,
(under
income per capita is $1,960 per
with post-tax value of up to VND20
costs in VN (imported car parts for
annum.
billion.
domestic
During the first 6 months of the year,
The sales of Audi, Mercedes, BMW,
higher than the total costs for CBU
3 luxury car brands officially joined
Porsche
imports (completely built units) from
the market, while many new car
which are considered less luxurious
Thailand
models were introduced.
by VN automobile connoisseurs,
most
have also been going very well.
automobile
(GDC)
In September and October alone,
factories.
showed that imported car turnover
dozens of new luxury models hit the
Luxury car market booming
A
report
Department
from
the
of
Customs
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General
small
and
and
market
has
Bentley,
Land
Rover
were
cars,
automobile
ASEAN),
car
assembly)
and
of
the
production
would
be
Indonesia,
where
world’s
largest
manufacturers
have
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LEGAL UPDATES
New tax policy to come into
and use of payment accounts at
to
force on Nov 15, 2014
payment service suppliers.
processing contract, it must ensure
This Circular takes on effect from 15
such requirements and conditions
October 2014. From the effective
as follows:
date of this Circular, the Decision
- Between the Company and the
No. 1284/2002/QD-NHNN dated 21
party ordering the processing must
November 2002 of the Governor of
either have the written certification
the
the
of specific quantity, category of the
Regulation on opening and use of
processing raw materials to be
deposit accounts at the State Bank
destroyed in Vietnam because the
and credit institutions and Article 4
raw materials are outdated or such
of
the contents have been already
The
Ministry
Circular
of
Finance
issued
151/2014/TT-BTC
on
instructions to the enforcement of
Decree
91/2014/ND-CP
of
the
Government on amendments and
supplements to a number of articles
of decrees on tax.
Notably,
the
circular
specifies
income tax exemption for some
types of incomes: Income from the
implementation
research
of
and
development
accordance
science
scientific
technological
contracts
with
and
the
in
laws
technology,
on
and
income from the sale of products
made
from
new
technologies
applied in Vietnam for the first time
in accordance with the laws and
the guidelines of the Ministry of
Science and Technology.
The
Circular
takes
effect
on
rule is applicable to taxes in the
fiscal year 2014.
the
opening
on
Circular
issuing
No. 23/2011/TT-
of
a
- The destruction of the outdated
implementing
processing materials quantity must
the
administrative
scheme
of
procedure
be
accepted
by
a
local
simplification in payment activity
Department of Natural Resources
and
the
and Environment and must be
Resolution of the Government on
ensured that it does not pollute the
the simplification of administrative
environment;
procedures within the jurisdiction of
-
the State Bank of VN shall expire.
department
other
areas
under
the destruction of processing
Coordinating
of
with
the
Customs
Subwhere
registering the processing contract
for being supervised the destruction
as prescribed in point dd, Clause 2,
raw materials in Vietnam
Article 27 of Circular No. 13/2014/TT-
Dispatch
BTC dated January 24, 2014 of the
No. 12487/TCHQ-
GSQL dated October 14, 2014 of
Ministry of Finance.
the
of
The quantity of the destroyed raw
the
materials in this case is exempted
in
from the import duty according to
processing contracts. According to
Clause 4, Article 12 of Decree
this Dispatch, if a company wants
No. 87/2010/ND-CP.
General
destruction
State Bank guiding the opening
in
Governor of the State Bank on
Circular
NHNN dated August 19, 2014 of the
materials
agreed in the processing contract;
Customs
No. 23/2014/TT-
raw
NHNN dated 31 August 2011 of the
payment accounts of banks
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Bank
Procedures and conditions for
November 15, 2014. Particularly, the
Guiding
State
destroy
Department
regarding
of
to
raw materials
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HIGHLIGHTS
With the recorded achievements,
APEC is now at a historic time of
every effort to shape a future
through
the
partnership
open
trans
Asia–Pacific
towards building an
economic
in
the
region,
promoting innovation, growth , and
the role of the Asia - Pacific region
in leading the global economy.
Over
the
past
25
years,
the
average tax rate of APEC reduced
to 5.7% from 16.9% in 1989 and
APEC
leaders
emphasize
path of the establishment and
economic
development of forum, as well as
regional
the 20-year efforts in implementing
connectivity
The
Asia-Pacific
Economic
Cooperation (APEC) leaders have
concurred to maintain the role of
the forum in promoting an open
investment and trade environment
in the Asia - Pacific region.
At the first session, they examined
ways
to
strengthen
regional
economic links- one of the three
priorities of APEC cooperation in
Bogor
demonstrated
Goals
Addressing the opening session,
Chinese
President
Xi
Jinping
described the APEC Summit this
as
milestone,
a
historical
significant
acknowledging
the
great achievements of the 25 year-
www.seiko-ideas.com
which
solidarity,
has
respect,
trust and support for mutual benefit.
Xi Jinping stated China contributes
US$10 million to the implementation
of APEC programs and projects on
capacity building for developing
The
leaders
important
praised
contributions
trade
increased
nearly six-fold from US$1.7 trillion to
US$9.9 trillion.
Many leaders shared their views on
more
effective
cooperation
in
APEC which has been expanded
into new areas, including climate
change
adaptation,
disasters
response,
natural
food
and
energy security, green economy
and oceanographic cooperation
member economies.
sustained efforts
2014.
year
the
intra-regional
APEC’s
and
to narrow the
development gap and stimulate
strong, sustainable, balanced and
equitable growth in the region and
the world, thus raising the strategic
position of the Asia - Pacific region.
thereby
delivering
practical
benefits to member economies.
They agreed to intensify efforts to
maintain the top important role of
the
APEC
sustainable
forum
in
supporting
economic
growth,
maintain prosperity and propel an
open
investment
and
trade
environment in the Asia – Pacific
region.
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SEIKO IDEAS CORPORATION
Vietnam Business Review
10
HIGHLIGHTS
In his speech, President Truong Tan
regional and regional programs,
in a meeting with leaders of the 12
Sang shared overall assessment of
including ASEAN, mainland ASEAN
TPP member countries at their fifth
the historical significance of the
and the Mekong sub-region.
summit
APEC Summit this year as well as
Highlighting the contributions of
November 10.
the role and contributions of the
Vietnam to APEC cooperation and
forum since its inception.
regional
“Vietnam highly appreciates and
Sang said through the process of
fully
comprehensive
supports
measures
the
accelerate
of
commitments, the implementation
proactive nucleus in Southeast Asia
of the Bogor Goals and trade and
and a bridge linking the mainland
investment liberalization.
and island ASEAN economies.
effective
With the prospect for deploying
connectivity, it is essential to closely
and finalizing negotiations on 15
link
free
efforts
with
development,
the
2020, Vietnam will become an
implementation of the Millennium
important link of a large economic
Development Goals (MDGs) and
connectivity network of 18 APEC
the
members.
sustainable
building
of
a
post-2015
trade
agreements
through
development agenda as well as
This provides a basic foundation for
response to global challenges.
the
APEC should continue to bolster
members
economic
technical
connectivity and the profile of the
cooperation and capacity building
APEC forum in the Asia - Pacific
for developing member economies,
region
especially
development and prosperity.
and
in
terms
of
new
generation economic and trade
issues.” Sang said.
The
Vietnamese
stressed
that
scientific
State
with
and
leader
economic,
technological
country
to
of
and
other
elevate
peace,
APEC
regional
stability,
www.seiko-ideas.com
the
spirit
of
mutual
he said.
Participants clarified that the deal
was meant to nurture economic
growth, create jobs, and improve
competitiveness
amongst
its
member economies.
At the end of the meeting, which
took place on the sidelines of the
22 nd Summit of the Asia-Pacific
Economic
Cooperation
Forum
running from November 10-11, they
adopted a joint statement detailing
the specific course of action to
ranging TPP deal
Launched in March 2010, the TPP
VOV - Vietnam is determined to
reach
a
comprehensive
and
(TPP) deal, President Sang affirmed
sub-
in
future.
engage
support
efforts
Vietnam pushes for wide-
balanced Trans-Pacific Partnership
and
It is necessary to continue the joint
speed up TPP talks in the near
potential, APEC members should
in
on
understanding and shared benefits,
regional
connectivity
China
international
integration, Vietnam is becoming a
ensure
Beijing,
connectivity,
Bali
To
to
adoption
economic
in
talks involve 12 diverse economies,
including
New
Zealand,
Chile,
Brunei, Singapore, the US, Peru,
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SEIKO IDEAS CORPORATION
Vietnam Business Review
11
HIGHLIGHTS
Vietnam,
Malaysia,
Canada,
Australia, Mexico and Japan.
The TPP accounts for approximately
40 percent of the world’s economic
output and more than 30 percent
of total global trade.
Vietnam mulls extra int’l bond
issue
Saigon
Times
-
The
Ministry
of
Finance, upbeat about the latest
successful
US$1-billion
sovereign
bond issue, is mulling an additional
international
bond
issue
in
the
coming time to raise more funds for
restructuring public debt.
The ministry’s plan comes after the
November 6 bond sale attracted
437 international investors who bid
for a total of US$10.6 billion worth of
debt paper, 10 times over the
amount put up for sale.
The 10-year sovereign bonds were
snapped up by 1:00 p.m., local
time,
in
San
Francisco
last
Wednesday. The bonds will be
swapped by those issued in 2005
and 2010, which have a combined
value of US$1.75 billion, according
to a statement released by the
ministry last Friday.
Of the 437 investors, 17% were from
Asia, 28% from Europe and 55%
www.seiko-ideas.com
from the U.S. In terms of institution,
The ministry attributed the success
84% were fund managers, 12%
in debt paper sales to the recent
banks and 4% insurance companies
Fitch
and pension funds. The debt paper
country’s
comes with an annual coupon of
made the coupon lower than in
4.8%,
2005 and 2010.
lower
than
the
earlier
Ratings
upgrade
credit
of
ratings,
the
which
estimate of 5.125%, thus helping the
A consortium of Deutsche Bank,
Government save around US$32.5
HSBC
million in 10-year coupon payment,
Bank is mandated to manage the
the ministry said.
issue and switch/buy back old
Through the sale last week, the
bonds. HSBC is assigned to pay and
Government restructured 54.4% of
distribute bonds.
the value of sovereign bonds issued
“Vietnam is quite a rare issuer so I
in 2005 and 25.4% of that in 2010,
think there will be interest because
thus
of the scarcity value. The economy
reducing
debt
payment
and
Standard
Chartered
pressure.
has stabilized significantly in many
Given this successful issue and
aspects,”
favorable global capital market
representative of fund manager
movements, the ministry is weighing
Schroder Investment Management
seeking Government approval for
Ltd
another international bond issue to
quoted by Bloomberg as saying.
Rajeev
based
in
De
Mello,
Singapore,
a
was
further restructure public debt.
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