MOF to Outline Plan for Government Bonds

The Ministry of Finance has outlined a plan that will give priority to government bonds in the bonds market under Decision No.261/2013. Under the plan, by 2020 the domestic bond market would be developed in conformity with the scale of the economy and with other parts of the domestic financial sector, including the stock market and monetary and credit market. The domestic bond market will also be developed in a way that would ensure its stability as well as the security of the entire financial system, while being gradually closer to international rules and standards. In detail, the number of outstanding bonds will increase from 18 percent in 2011 to 38 percent of the GDP by 2020. Outstanding government bonds will account for 22 percent; enterprise bonds, 7 percent; and the remaining, government-guaranteed bonds, and bonds issued by local governments (or municipal bonds). From now to 2015, government bonds will be issued in terms of four to six years, and the term will last between six and eight years during the 2006-2020 period.

VN-index End March at 491.04 Points

The Mar. 29 trading witness a significant price decrease of the market, however, with the strong support form the bluechips the market still end up in green. At the end of the month, VN-Index finally stand at 491.04 points. VN-Index has experienced a pretty good month starting with the bottom of 460 points. In Mar. the VN-Index also hit a new record of 500 points, the highest for 52 weeks. However, liquidity in Mar. has severely declined in comparison with the previous month.

Credit Growth Shown Positive Sign

According to SBV, at the date of Mar. 21, the credit growth in banking system has shown positive signs with an increase of 0.31% from the previous month and up 0.03% compared to the end of 2012. However, foreign currency credit growth has decreased to negative 1.54% compared to last month and negative 6.25% compared to Dec 2012. Meanwhile, the mobilized fund continues to increase by 1.81% over the previous month and up 3.86% from last year.

SBV to Lower Interest Ceilling

From Mar. 26, SBV has lower the interest rate ceiling from 8% to 7.5% per year. In addition, SBV has also deceided to lower the refinancing rate from 9% to 8% per year and adjusted the discount rate from 7% to 6% per year. Finally, the interest rate in the interbank payment system was reduced to 9%  from 10% per year previously.

In SBV First Bidding 2,000 Taels of Gold Sold

As many as 2,000 taels of gold were sold for US$2,100 each in the first gold bullion bidding held by SBV on Mar. 28. Two out of the 21 registered credit institutions and enterprises won the bidding. The sold amount is part of 26,000 taels put out for sale. This was organised in line with a SBV Circular on gold bullion trading in the domestic market and the SBV Governor on the process of gold bullion trading. Through the sale, SBV aims to raise the gold supply and to stabilise the market.

SBV to Release Press on SCB One Year Operation

SBV has recently released a press on the operation of Saigon Commercial Joint Stock Bank (SCB) after the consolidation in early 2012. The current SBC are formed after the merge of three banks namely: SCB, Tin Nghia Bank and Ficombank. For one year, the bank has achieved positive progresses. Specifically, SCB has significantly improved the liquidity situation, the financial capacity and the capital raised from the economy has increased by 35.9% in 2012, 7% more in the first two months of 2013. Before that, on march 19, SBV also has had writen approval on increasing charter capital of SCB from US$ 529 mil. to US$ 697 mil.

Japanese Nidec to Expand Investment in Vietnam

Japan’s Nidec Corporation plans to expand its investment in Vietnam to US$1.5-2 billion from now to 2015, with a focus on manufacturing car spare parts and robots. The corporation has established nine factories with a combined investment capital of US$800 million in Vietnam alone. Nidec has designed plans to conduct product research and development -- the phases which were once done in the US and Japan before going to producers, along with opening plants and workshops in Vietnam.

450 Business to Participate Vietbuild

More than 450 businesses from 18 nations in the world will participate in the international exhibition on construction, building materials, real estate, interior and exterior decoration (Vietbuild 2013) in Hanoi from Mar 28 to Apr. 1. The event is co-organised by the Information Centre under the Ministry of Construction, Vietbuild Construction International Exhibition Organisation Corporation, and AFC international Exhibition Fair Corp. At a press conference in Hanoi on Mar. 25, the organizing board said both local and foreign businesses will have the chance to introduce their new products and sign contracts with their partners.As many as 1,350 pavilions will be set up to display a wide range of construction materials, interior decoration designs, electric equipment, sanitation, and glass products, as well as new production technologies. Among domestic companies are Viglacera Corporation, Dong Tam Joint Stock Company, and Eurowindow Joint Stock Company.

Farm Produce Exports Hit US$6.56 bn. in Q1.

Export earnings of agro-forestry and fishery products rose 6.2 percent in the first quarter of this year to US$6.56 billion, according to the Ministry of Agriculture and Rural Development. However, seafood exports fell 5.9 percent to earn US$1.21 billion. Rice exports grew 34.3 percent in volume to 1.38 million tonnes, but still declined 5.7 percent in value to US$616 million. The tea sector sold 29,000 tonnes overseas for US$43 million, down 14.1 percent in volume, but up 2.5 percent in value. The pepper sector shipped 39,000 tonnes overseas for US$242 million, down 15.4 percent in volume but up 11.6 percent in value. The timber processing sector defied expectations, increasing its three-month export revenue by 16.5 percent to US$1.18 billion.

FDI capital sees sharp rise in March

Vietnam has attracted US$5.4 billion in foreign direct investment between Feb. 20-Mar. 20, a monthly record figure.Of the total, US$2.93 billion came from newly-licensed projects, a year-on-year increase of 2.2 percent, and the remaining US$3.10 billion was additional capital from operational FDI projects, up 277 percent. The March figure helps bring the total FDI capital of the past three months to US$6.034 billion, according to the GSO. Japan is the largest investor in Vietnam during the first quarter of this year, pouring US$3.16 billion into the country. Singapore and the Republic of Korea are the second and third biggest investors, respectively. Thanh Hoa province has attracted the most foreign investment thanks to the added US$2.8 billion from the Nghi Son oil refinery project, followed by Thai Nguyen, Binh Duong, Dong Nai and Haiphong. As of March 22, US$2.7 billion in FDI has been disbursed, an increase of 7.1 percent from a year earlier. 

Cat Bi International Airport upgrades begins

The Hai Phong municipal People’s Committee has held a ceremony to launch construction on the Cat Bi International Airport upgrade project. The upgrade of the airport aims to meet the northern port city and neighbouring areas’ aviation demands. The project has total investment capital exceeding US$ 180 mil. and is scheduled for completion by 2015. The upgrade will allow the facility to meet the 4E level international airport standards, authorising it to receive aircraft models like the Airbus 321 and Boeing’s 777, 747, and 767. The airport also serves as a standby for Noi Bai International Airport. By 2015, it is expected to welcome 2 million passengers and 20,000 tonnes of cargo each year.

Auto sales plunge in February

Total car sales in Feb dropped 53% from the previous month with 4,325 units being sold, consisting of 1,620 cars and 2,633 trucks. Of the figure, locally assembled cars totalled 3,439 units (down 61 percent) while imported vehicles numbered 841 (down 50 percent), according to the Vietnam Automobile Manufacturers' Association (VAMA). VAMA members alone sold 3,679 vehicles last month, just half of January's figure. The association attributed the fall to the high demand for vehicles in January ahead of the lunar New Year holiday and the low demand immediately afterwards. They added that February is a very short month, which also negatively affected the sales. Revenue in the first month of this year was extremely low due to an increase in registration fees introduced on Jan. 1.  Japanese Toyota retained its top position in sales last month, with 1,337 units sold, followed by Vietnamese carmaker Truong Hai. Ford Vietnam ranked third, but retail sales rose more than 63 percent year-on-year to 351 vehicles, the highest increase recorded by any carmaker. Its strong February performance allowed Ford to capture 8.3 percent of the overall vehicle market for the month.  VAMA has projected that overall car sales this year will rise 8 percent from 2012 to about 100,000 units.

Petrol Prices to Suddenly Increase

Retail petrol businesses increased their oil and petrol prices by VND362- US$0.075 per litre, starting at 20.00pm on Mar. 28. Petrol A92 is now traded at US$1.2/l, beating the record high US$ 1.19/l level imposed in Apr. 2012. Diesel, kerosene and mazut prices rose to US$1.095, US$1.10 and US$0.92 per litre respectively. The sudden price hike came after petrol businesses received an approval from the Ministry of Finance and Ministry of Industry and Trade to adjust the retail prices. The two ministries attributed the hike to the recent fluctuations in world oil prices, despite the government’s efforts to stabilise the domestic market, including the use of the Price Stabilisation Fund. Retail petrol prices have been adjusted four times since the beginning of 2013.

CPI to Slightly Decrease in March

Vietnam’s consumer price index (CPI) in March fell just 0.19 percent from February, bringing the three-month price index to 2.39 percent, according to the General Statistics Office (GSO). The decline reflects the true nature of the market trend as the prices of commodities are stabilized due to a low consumer demand after the traditional Lunar New Year (Tet) holiday. As a result, many businesses are now struggling with high inventory levels. The March CPI represented a year-on-year increase of 6.64 percent, or 6.91 percent higher than last year’s average. 

Indonesia imposed anti-dumping tax upon steel of Viet Nam

Indonesia has imposed anti-dumping tax on imported steels from five countries and territories, including Viet Nam, in order to protect domestic steel producers on March 19th in 2013. The Indonesian Minister of Finance has approved the decision to impose steel import tax rate from 5.9 to 55.6%, applied in three years for steel imports from China, Jpan, South Korea, Taiwan and Viet Nam. The introduction of that new tax law is due to the request of the Indonesia Anti-dumping Committee (KADI), basing on results of the survey conducted for rolled steel and cold-rolled steel sheet from June in 2011 in recommendations of the Indonesia’s largest domestic steel manufacturer.