Sugar import quota not yet granted

HCMC, Dec 3, 2012. Since sugar output in the 2012-2013 crop is enough for domestic consumption, sugar import quota is not granted yet despite the country’s WTO commitment to import 74,000 tons in 2013.

Doan Xuan Hoa, deputy head of the Agro-Forestry-Aquatic Product Trading, Processing and Salt Industry Department under the Ministry of Industry and Trade, said his ministry and the Ministry of Industry and Trade would consider supply-demand at home to decide when to import sugar as committed. The earliest time possible may be August 2013.

Apart from the amount to be imported under the commitment to WTO, it is unsure if local traders can import sugar in 2013, said Hoa.

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Vietnam aims to lift sovereign credit rating

Sep 5, 2012. The Ministry of Finance has submitted a scheme to the Prime Minister for improving Vietnam’s sovereign credit rating, with a target for the country to achieve investment grade by 2020.

Currently, the nation maintains credit ratings from Standard&Poor’s, Moody’s and Fitch Ratings. S&P gives the country an overall rating of BB-, while Moody’s rates it B1 and Fitch gives it a B+ rating, all three or four levels below investment grade.

Under the proposed scheme, the ministry highlighted measures relating to institutional and economic management that include boosting social welfare policies to narrow the gap between rich and poor and among regions of the country.

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FDI down 30% in Jan-May 2012 compared with 2011

The national index of industrial production in the first five months of this year increased 4.2 per cent against the same period last year, the Ministry of Planning and Investment reported at a meeting in Ha Noi yesterday.

This was the lowest growth in comparison with the same time over the past years. However, since the early months of this year, index growth had reflected positive performance, the ministry said.

Particularly, the indices of industrial production and processing have risen by 3.9 and 2.4 per cent respectively in the first two months, up 6.5 and 8.6 per cent in March as well as 7.5 and 9.3 per cent in April.

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Re-export rule change proposed: must be re-exported within 60 days instead of 120 days

HA NOI, May 28, 2012. Goods temporarily imported into Viet Nam for re-export will be permitted to stay in the country for only 60 days after customs procedures instead of 120 days if a proposal by the Ministry of Industry and Trade is approved.

Another new point in the draft is about terms and conditions in goods-outsourcing contracts that involve foreign parties: he contract must include names and addresses of involved parties and the direct outsourcing company; name, quantity and price of outsourced products, time and kinds of payment, and information on imported material value and waste treatment measures.

The draft amendments are expected to be finalized and proposed for approval by the Prime Minister during the first three months of next year.

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State urged to aid Song Da Group (SOE Reform)

HA NOI — The Ministry of Construction has asked the Prime Minister to approve a proposal to help the Song Da Group balance its capital sources to repay foreign debts owned by its affiliate Ha Long Cement JSC, according to VTC News.

Accordingly, Song Da will be allowed to borrow from the Ministry of Finance’s Accumulated Fund for Foreign Loan Repayment to help the Ha Long pay its debts. This year, it is due to pay roughly VND437 billion (US$ 20.8 million) to France’s Natisix Bank.

Earlier, the Ministry of Finance was assigned by the Prime Minister to act as guarantee to Ha Long Cement in borrowing foreign loans. However, the ministry guaranteed only Song Da Corporation (merged into the core of Song Da Group).

Song Da Corp. gave a loan of VND3.335 trillion ($ 158.8 million) to Ha Long Cement at the same interest rate of foreign banks to build a cement project with total investment capital of VND6.46 trillion ($ 307.6 million).

Therefore, Song Da Corporation’s repayment completely depends on the capacity of Ha Long Cement.

However, the Ha Long cement project, put into operation in early 2010, delayed progress for one year and suffered losses of roughly VND500 billion in 2010 and VND581.3 billion in 2011.

The Ha Long Cement Co therefore is unlikely to repay its debts on time.

According to a report from the Song Da Group, it aided Ha Long Cement with a total VND1.211 trillion ($ 57.6 million) until March 31 this year to pay its affiliate’s foreign loans.

Meanwhile, roughly VND10 trillion ($ 476.2 million) of the Song Da Group’s capital remain lodged in uncompleted works, which means it cannot continuously fund Ha Long Cement to pay its loans, the group said.

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Additional background

According to the Committee for Enterprise Reform and Development and the Ministry of Planning and Investment, state-owned enterprises hold 70% of the total real property in the economy, account for 20% of investment capital throughout society, and devour a staggering 60% of the credit in the commercial banking system, 50% of state investment capital and 70% of official development aid capital.

However, these same enterprises are responsible for only 25% of total sales revenues, 37% of pre-tax profits and 20% of the value of national industrial output. The rate of credit use by state-owned businesses to generate revenue is definitely higher than that of other enterprises. It takes VND2.2 in capital to create VND1 in revenue compared to VND1.2 in capital spent by businesses outside the state corporate sector and VND1.3 in capital expenditures by foreign enterprises operating in Vietnam.


Plan of discordance: Transport Ministry plans $ 600 million for new HQ and agencies buildings

May 15, 2012. When the Transport Ministry announced last week a cost-extensive plan to spend some VND12.2 trillion, or nearly US$ 600 million, to build the new headquarters for the ministry as well as its affiliated agencies, with two-thirds of which to be disbursed in the next three years, public disagreement heats up, as shown in local media.

In the plan approved by Minister of Transport Dinh La Thang, the cost for building the ministry’s headquarters alone amounts to VND1 trillion, while buildings for other departments under the ministry’s direct administration require over VND4.8 trillion, reports Tuoi Tre. The plan also clarifies that of the VND12.2 trillion for building headquarters, the ministry will ask for some VND10 trillion from the State Budget.

Nguyen Duc Kien, former vice chairman of the National Assembly, also observes that such a costly program is unwelcome at a time of economic difficulties like now, according to the website of Doi Song va Phap Luat newspaper. The paper also quotes Nguyen Thi Kha, a member of the NA Committee on Social Issues, as saying that “State agencies need to practice thrift to reduce State Budget deficit… and the State spending should prioritize urgent issues of the people’s livelihood.”

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1,200 “diplomatic cars” to pay tax arrears

May 9, 2012. The Ministry of Finance said it has completed collecting feedback from relevant ministries and agencies on its proposal to collect taxes in arrears from cars bearing diplomatic plates owned by non-diplomats in the country.

The NG in the license plate indicates “diplomatic.”

Under the proposal, which will be submitted to the government for final approval, the ministry rules that a tax of 5 – 90 percent will be levied on around 1,200 bogus diplomatic cars that are in use throughout Vietnam, Deputy Minister of Finance Do Hoang Anh Tuan said.

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Tragedy at public hospitals

Speaking at a meeting with Deputy PM Nguyen Thien Nhan on July 2, 2011, Minister of Health, Nguyen Thi Kim Tien (Deputy Minister of Health at that time), said that Vietnamese patients spend around $ 1 billion per annum for treatment at hospitals in Singapore alone.

The number of Vietnamese patients who go to Thailand, South Korea and other countries for treatment is also high, according to the Ministry of Health. Therefore, Vietnamese people spend much more than $ 1 billion for overseas healthcare services.

According to the Ministry of Health, Vietnamese patients are not fully aware of achievements and progresses of Vietnam’s healthcare sector, while the country’s health sector has strongly developed to reach the regional and world level, as the Health Minister says.

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Vietnam Plans to Legalize Sports Gambling

Mar 5, 2012. Vietnam is emerging as the latest Asian nation to loosen a straight-laced attitude to gambling, with the Finance Ministry saying it plans to legalize sports betting.

The move, partly inspired by Singapore’s success in reinventing itself as a casino hub in recent years, followed discussions about easing restrictions on gambling in other major markets, such as Japan, and underscored the speed with which the gambling world’s center of gravity has shifted toward Asia.

Hanoi’s Finance Ministry said Monday that legalizing and regulating betting on soccer matches and other sporting events would help limit the social damage caused by underground gambling syndicates. While Vietnam has only a handful of casinos, which only foreign-passport holders can enter, informal gambling on European soccer matches is widespread. Many Vietnamese also regularly cross the border to gamble at Cambodian casinos, a practice that Vietnam’s Communist leaders long have viewed with distaste.

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Vietnam still seeks a way-out for state-owned groups

DNSGCT, Jan 17, 2012 The government seems to be very determined to fine-tune state-owned economic groups (SEGs), when it hold a significant meeting in December 2011 that focused on these “great businesses” that was presided over by Prime Minister Nguyen Tan Dung, Deputy Prime Minister Vu Van Ninh (in charge of finance) and Hoang Trung Hai (in charge of industry and trade).

SEG is an economic model that has been implemented in the state-owned sector since 2005. Under this model, companies that have relations in terms of capital or cooperation grouped up to create mega-companies that rule the entire industry in which the mega-companies operate in.

SEGs play the role of leaders in Vietnam’s key industries, including rubber, shipbuilding, coal-mineral mining, oil and gas, electricity, textile and garment, insurance, chemistry, construction and housing and urban development.

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