MBC welcomes our New Corporate Members “CHIN WELL FASTENERS (VIETNAM) CO., LTD”,” GAMUDA LAND (HCMC) JOINT STOCK COMPANY”,” HAWE INDUSTRIAL CONSTRUCTION JOINT STOCK COMPANY”, ” PANPAGES VIETNAM LTD”,” TUAN LE CONSTRUCTION COMPANY LIMITED” and ” ZICOLAW (VIET NAM) LTD”---MBC welcomes our New Individual Members “ALAN NG AIK HOW from TAN VIET XUAN PRODUCTION JOINT STOCK COMPANY “, “GAN YEE CHUN from SAMTEC VIETNAM COMPANY LIMITED “, “GARY LIT from GL TRAINING & CONSULTANCY”,” GOH SHUI HSIN from HEXACHEM CO., LTD”, “GRATIA GADING GEORGE from KRETOP INTERNATIONAL CONSTRUCTION CHEMICAL”, “HOW YEN LING from GLOBAL TRAINING NETWORK ALLIANCES SDN BHD”, “LENG TZE SING from CT TNHH MOC CAPITAL VIETNAM”,” LIM HOCK SIN from FURNITECH COMPONENTS VIET NAM CO., LTD”, “MARTIN WONG SIEW BING from SOUTHEAST ASIA TELECOMMUNICATIONS HOLDINGS PTE.LTD “,”MICHEL KHAOU from AGILITY CO., LTD “, “PETER LIM WEI HENG from TEXCHEM MATERIALS (VIET NAM) CO., LTD “, “ROGER YAP WENG FOOK from CONG TY TNHH MOLUTION”, “TAN JING KUAN from NORD ANGLIA EDUCATION GROUP”,” TAN LAI SEE from ABS ENGINEERING VIET NAM LIMITED”, “TAY KENG CHONG from NIRO CERAMIC VIETNAM”, “TEO SECK CHUAN from SEAMASTER PAINT VIETNAM CO.,LTD”,” TEOH TEAN TIAR from GTC VIETNAM SERVICE AND TRADE COMPANY LIMITED”.

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Vietnam News

HEADLINES

 

TOP NEWS

Vietnam and India rank as most popular developing markets

 

FINANCE

SBV strongly withdraws capital

Banks, finance companies massively mobilise capital to serve end of the year credit season

 

ECONOMY

Timber exports to hit $8 billion

Nearly 11,000 new businesses established in November 2017

 

INVESTMENT

Polish group acquires Vietnamese pharma company

Two billion dollar projects in Haiphong calling for investment

 

REAL ESTATE

Vietnam posting among world's most attractive office yields

Mixed-use development boom in Vietnam’s cities

 

OIL&GAS&ENERGY&MINING

Foreign capital inflows perked up by multibillion-dollar power plant licensing

Agreement on the roadmap for implementing Bao Vang gas field

 

LEGAL

Policies on transport infrastructure construction investment to be finalized

Population law must protect elderly: experts

 

 Source:

Dr. Oliver Massmann

International Attorney at Law
Certified Financial Accountant and Auditor
General Director of Duane Morris LLC
Partner of Duane Morris LLP
Member to the Supervisory Board of PetroVietnam Insurance Holdings Joint Stock Company

 

TOP NEWS

Vietnam and India rank as most popular developing markets

BY ANDREA WAITROVICH, IREI

Vietnam and India rank as the most popular developing markets, according to the Emerging Trends in Real Estate® Asia Pacific 2018 report, published by the Urban Land Institute (ULI) and PwC.

In Vietnam, investors continue to draw favorable comparisons with the China of 10 to 15 years ago. GDP growth is in the area of 7.4 percent, and while bureaucracy remains an issue, the regulatory environment is becoming slowly less restric­tive.

Notably, the survey ranked Ho Chi Minh City among the highest in terms of rental value growth, reflecting confidence that economic strength will spill over to property values. Very little prime office stock has been built in recent years, meaning very few stabilized assets are available to buy. That leaves the residential sector as the default play for most inves­tors, usually in conjunction with a local joint venture partner.

Like Vietnam, investment in India tends to be strategic in nature, aimed at front-running long-term economic growth resulting from reforms being rolled out by a popular government intent on tackling India’s enduring inefficiencies. Unlike Vietnam, however, India offers mas­sive scale, a factor that makes it especially popular for funds deploying large amounts of capital.

Over the last few years, various large global opportunistic and institutional funds have made big commitments to the Indian office sector — mainly in the form of business parks, and many of these early entrants are now either consolidating their holdings or looking to exit via India’s nascent real estate investment trust (REIT) market, which is likely to see its first initial public offering (IPO) in the first quarter of 2018, according to several interviewees.

And India’s logistics sector has recently been the target of an investment boom, largely due to tax reforms. In addition, retail assets also are now a popular play, with a number of platform or portfolio deals either already completed or in the works.

 

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FINANCE

 SBV strongly withdraws capital

Vneconomy

 

From the end of last week until early this week, market recorded different-scaled bill issuance to withdraw money of the State Bank of Vietnam (SBV). In particular, in the three consecutive sessions of the last week, SBV for the first time since the beginning of the year raised the scale of bill issuance to nine trillion dong in order to promote money withdrawal. Previously, since the resumption of bill issuance on July 17th 2017, the market recorded the largest withdrawal of SBV at eight trillion dong per session.

Through four consecutive sessions with new scale as mentioned in the above, as of November 27th, most of credit institutions (CIs) have absorbed, and the total capital SBV withdrew via the balance of bills in circulation has reached 45.4 trillion dong a fairly large size from the beginning of the year until now.

In recent years, when the capital status of CIs showed signs of abundance (especially through large purchases of foreign currency) and there were needs to be neutralised, SBV, when balancing the interbank interest rates that need to be regulate, often used bill tool to withdraw dong. In the above-mentioned increase in the scale of bill issuance, in addition to the large withdrawal, the capital status of the system has also showed signs of excess with strong and rapid decline of dong interest rates on the interbank market.

In mid-November 2017, the dong interest rates on the interbank market rebounded fairly strongly, such as the overnight rate quickly rose from 1 percent to 1.5 percent per annum. However, from the end of last week to the beginning of this week, the interbank rates have fallen sharply.

As of November 27th, the average interbank rates in dong continued to fall across all terms compared to the last session of the week before, reaching just 1.10 percent per annum on over-night term, 1.33 percent per annum on one-week term, 1.58 percent per annum on two-week term, and 2.38 percent per annum on one-month term.

Meanwhile, the average interbank rates in US dollars slightly rose up on overnight term in the early week and remained unchanged in the other terms, reaching 1.33 percent per annum on overnight term, 1.44 percent per annum on one-week term, 1.54 percent per annum on two-week term, and 1.76 percent per annum on one-month term.

 

 

 

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Banks, finance companies massively mobilise capital to serve end of the year credit season

Tri Thuc Tre

 

The year ends in just over a month and this is also the time when credit activities most prosper in 12 months. Therefore, banks and finance companies are racing to mobilise capital to increase capacity in order to best meet the needs of borrowers. Banks are attracting deposits by high interest rates or promotions. It is very rare to find a bank that is indifferent to this trend.

In the group of large banks, BIDV last week raised short-term deposit rates by 0.4-0.5 percentage point, from 4.3 percent to 4.8 percent per annum on one-month term, and 4.8 percent to 5.2 percent per annum on terms from three to six months. Some branches of BIDV even raised the rates of medium terms from six to 11 months, such as up to 5.8 percent per annum on terms from six to eight months, and 6 percent per annum on terms of 9-11 months.

Meanwhile, VietinBank has increased its short-term deposit rates to higher levels than other banks in the same group for over two months. While BIDV, Vietcombank and Agribank still applied one-month rate at 4.3 percent, VietinBank started to offer this rate at 4.8 percent per annum. The bank has even recently launched fairly attractive promotions related to interest rates. It is applying a 0.3 percent interest rate plus to new customers depositing capital via e-banking service, applicable for all terms from one month and more.

In the group of private banks, the deposit rates are pushed significantly higher than state-owned banks’ with the highest levels reaching 7.9-8.2 percent per annum at OCB, VietABank, and VietCapitalBank. Deposit rates for long-terms of over 12 months are up to 7.5 percent-7.6 percent per annum at large-scaled private banks such as VPBank and Sacombank, while medium terms of six months to less than 12 months are also offered rates of no less than 6 percent per annum. Customers depositing capital in the form of certificate of deposit can even enjoy rates of up to 8.7 percent per annum at VPBank on 60-month term.

In addition to the competitive interest rates, many banks have introduced promotional programmes targeting consumers. For example, depositors have a chance to win a car at Construction Bank, or are given gifts worth a total value of seven billion dong. Meanwhile, Sacombank invites customers to deposit capital and have a chance to win an apartment from a lucky draw. Some other banks are also taking the chance to launch programmes for the Lunar New Year season, such as Sacombank and SCB with total value of up to 30-40 billion dong.

Unlike banks which can use attractive interest rates to lure depositors, finance companies, which are not allowed to accept deposits of individuals but only from organisations, face much more difficulties in mobilising capital. However, they cannot sit still as the credit season is heating up.

According to reports of finance companies, they are inviting organisations to buy certificates of deposits or deposit capital on terms from one month to 60 months at attractive interest rates. They do not publish their savings interest rate, but information gathered by reporter from some companies with decent market share show that they are willing to pay 95-10 percent per annum for big deposits.

In addition to calling for capital from domestic market and foreign firms in Vietnam, finance companies also target the huge capital source from major financial institutions in the world. Recently, Fe Credit has announced to attract 100 million USD from Deutsche Bank AG Singapore.

Kalida Ghose, vice Chair cum general director of FE Credit said that the success fundraising shows that international investors highly value the company’s business model as well as the prospect of the consumer finance market. Meanwhile, Sreenivasan Iyer, Managing director cum director of Corporate Finance Division of Southeast Asia at Deutsche Bank said that the bank has recognised the potential of Vietnam’s economy with many investment opportunities and successfully negotiated with the partner. He added that this is the biggest loan ever of Deutsche Bank in consumer finance field in Vietnam.

Previously, in late 2016, FE Credit also received a syndicated loan worth 100 million USD arranged by Credit Suisse AG Singapore, which is also the credit agent and representative for guaranteeing this loan.

FE Credit has very big ambition on the consumer finance market. Despite holding up to 48 percent of the market share, the company is aiming to gain more market share. In addition to the loans from external sources, in August 2017, the company’s parent bank VPBank poured nearly 1.7 trillion dong to supplement its charter capital.

Not only looking for input source by interest rates and calls for capital from domestic and international organisations, commercial banks and finance companies have also stepped up capital outflows via preferential credit packages or attractive promotions.

For example, VIB is launching a package with interest rates from only 6.9 percent per annum for home loan borrowers with commitment for quick disbursement; TPBank is offering home loans at 7.2 percent per annum; SHB is applying a preferential credit package with interest rates from 7 percent per annum for corporate customers importing goods from Taiwan; ABBank is offering investment loans at interest rates from 8.3 percent per annum and loans to small and medium enterprises at interest rates from just 6.68 percent per annum.

Banks are even focusing on consumer loans in the end of the year season, such as home repair loans, and car loans. Typically, OCB is lending at interest rates from 5.99 percent per annum with disbursement committed within two hours in order to serve production, business and consumption in the end of the year. Many other banks are offering car loans with preferential interest rates, gifts and quick disbursement commitment, such as VIB, Techcombank, NCB, TPBank, PVcomBank, and SHB, etc.

Some banks are building specialised products to attract customers to not only borrow capital but also to use more banking products and services, such as HDBank with supports to small and medium enterprises, and Techcombank and Maritime Bank with complete financial packages, etc.

Similarly, finance companies are introducing deeper and wider cooperation programmes with electronics centers and supermarkets. Not only offering more attractive than rivals with quick procedures and diversified loan products, this group is also competing in quality to draw attention of more users.

Answering at the interpellation of the National Assembly on November 16th, Governor of the State Bank of Vietnam (SBV) Le Minh Hung affirmed that the credit growth in 2017 (with target of 18 percent and revised target of 21 percent) will be met as it was over 13.6 percent in the first 10 months of the year.

Governor Hung also said that such credit growth rate is not abnormal because it comes from the real need of the economy and credit is flowing into the areas that the government expects. This has dispelled many people’s concerns of hot credit growth threatening inflation as well as negatively affecting the economy in the previous time.

The data in November 2017 has not been updated, but with the efforts of commercial banks and finance companies as mentioned in the above, the credit from now until the end of the year will surely flow stronger, not to mention the seasonal factor. Thus, the annual credit growth target is entirely within reach.

 

 

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ECONOMY

 Timber exports to hit $8 billion

VNS

 

The export turnover of Vietnamese timber and timber products is estimated to hit $8 billion this year, 10 per cent higher than the target, according to the Ministry of Agriculture and Rural Development, at a meeting held yesterday on sustainable forestry development.

The forestry sector recorded many other encouraging achievements this year, said Nguyen Quoc Tri, deputy director of the ministry’s Vietnam Forestry Administration.

He cited the growth of nearly 200,000ha of forest, equivalent to100 per cent of the yearly target, rapid reduction in the number of violations of forestry-related regulations and increasing investment of businesses and people in forestry sector.

Authorised agencies detected more than 14,500 violations since early this year, a year-on-year decrease of 70 per cent.. This left 1,400ha of forest damaged, a year-on-year decrease of 20 per cent.

The payment for forest environmental services has become an important source of finance to help improve the efficiency of forest protection, management and development. The country has collected VND1.6 trillion ($71 million) for forest environmental services this year.

Addressing the event, deputy minister of Agriculture and Rural Development Ha Cong Tuan said that the forestry sector had gained basic achievements over the past years.

The rate of forest coverage increased from 28 per cent in 1992 to more than 41 per cent in 2016. The production rate of the forestry sector reached 7.1 per cent from 5.9 per cent in 2013. The amount of timber from planted forests is meeting 80 per cent of demand.

However, Tuan noted that the forestry sector still faced many challenges, particularly the damage of natural forest and low growth of forestry value and ineffective management of some forestry businesses.

More effective measures were needed to help further develop the sector, he said.

Former minister of Agriculture and Rural Development Le Huy Ngo said the production and processing of forest-based products still received little attention. He said it was necessary to develop a value chain from timber to management organisation, product processing and the market to increase competitiveness.

It was also necessary to pay attention to investing in both technique and human resources as well as encouraging and praising good examples of households and businesses in the sector, he said.

Participants at the event also spoke of the need for more effective measures to prevent deforestation and tackle shortcomings in the legal system and management tasks..

 

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Nearly 11,000 new businesses established in November 2017

Bao Dau Tu

 

In November 2017, there were 10,920 newly established businesses with a total registered capital of 109.899 trillion dong, according to the Business Registration Office (under the Ministry of Planning and InvestmentMOPI).

Generally, in the first 11 months of 2017, the total number of newly established businesses and businesses that resumed operations was 140,394 units, with a total registered capital of over 2,714 trillion dong. The average registered capital per business in the first 11 months of 2017 reached 9.8 billion dong, up 24.3 percent year-on-year.

Regarding the number of registered businesses, in the past 11 months, the number of businesses concentrated mainly in such sectors as: wholesale; retail; repairing of automobiles and motorbikes with 41,627 units, accounting for 35.9 percent; processing and manufacturing industry with 14,846 businesses, reckoning for 12.8 percent; construction with 14,695 businesses, making up 12.7 percent; science and technology; consulting services and design; advertising and other professions with 8,663 businesses, representing 7.5 percent.

Taking into account the number and growth in number of businesses, we see that the wholesale and retail industry; repairing of motorcycle and motorbike have the highest number of registered businesses compared to the whole country. However, in terms of the increase of businesses by sector compared to the same period of 2016, the real estate sector had the highest proportion of 60.5 percent.

Regarding the registered capital, in the first eleven months, the real estate business sector had the highest registered capital of 314.266 billion dong, accounting for 27.8 percent; followed by wholesale; retail; repairing of automobiles and motorbikes with 182.021 billion dong, accounting for 16.1 percent; construction with 155.292 billion dong, representing 13.7 percent; Processing and manufacturing industry with 134.072 billion dong, making up 11.8 percent; electricity, water and gas distribution with 63.148 billion dong, reckoning for 5.6 percent; Science and technology; consulting services, design; advertising and other professions with 56.552 billion dong, comprising of five percent; Accommodation and catering services with 40.487 billion dong, equal to 3.6 percent.

Regarding the proportion of average registered capital per business in the past 11 months, some sectors had high proportion such as real estate business with 69.3 billion dong/business; electricity, water and gas distribution with 68.4 billion dong/business; arts and entertainment with 19.1 billion dong per business; mining with 18 billion dong per business. It can be seen that since the beginning of this year, the real estate industry has made positive changes, attracting a great deal of capital poured into investment compared with the remaining sectors.

Regarding the number of registered labourers, some industries and sectors attracted many labourers to enter the market, including 396,167 labourers in manufacturing and processing sector, or 37.2 percent; 237,918 employees in wholesale; retail and repairing of motor vehicles and motorbikes, or 22.3 percent; 106,762 labourers in construction sector, or 10.0 percent; 58,290 employees in science and technology, consulting services, design; advertising and other professions, or 5.5 percent.

Some sectors had high average proportion of labourers per business, of which, manufacturing and processing is currently the industry with the highest proportion of labourers in economic sectors with 26.7 employees/business; followed by the health sector and social work activities with 14.7 employees/business; production and distribution of electricity, water and gas with 13.4 employees/business; Agriculture, forestry and fisheries with 11.2 labourers/business; mining with 10.4 employees/business;

As such, regarding the number of registered labourers and the proportion of labourers, the manufacturing and processing sector was more dominant than the rest, but in terms of the increase in labourers over the same period of 2016, this sector decreased.

 

 

 

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INVESTMENT

Polish group acquires Vietnamese pharma company

VET

 

The Adamed Group from Poland has acquired a controlling stake in Dat Vi Phu, Vietnam’s fastest-growing pharmaceutical company.

The share purchase agreement was signed in Hanoi in the presence of visiting Polish President Andrzej Duda and State President Tran Dai Quang.

The transaction is the largest direct Polish investment in Vietnam to date.

The deal provides for an extensive investment plan, including the transfer of Adamed’s knowledge and expertise. The purchase agreement was signed by Dr. Ma³gorzata Adamkiewicz, Director General of the Adamed Group, and Mr. Pham Tai Truong, the founder of Dat Vi Phu, on November 28.

Dat Vi Phu manufactures a wide range of medicinal products for both the Vietnamese and neighboring markets. “We consider our investment to be a launch pad for the further dynamic expansion of the Adamed Group into the Asia-Pacific region,” said Dr. Adamkiewicz. “I’m convinced that, in view of the scale of this transaction and further investments into the development of the company, our undertaking will constitute a milestone in strengthening economic relations between Poland and Vietnam.”

In its more than ten years in the business, Dat Vi Phu has acquired a sizable share of Vietnam’s pharmaceutical market. “The investment by the Adamed Group is an opportunity for our continued dynamic development,” said Mr. Truong. “Cooperation with such an experienced partner will enable us to reinforce our position in the local market and expand in the Asia-Pacific region.”

The investment forms part of the internationalization of the Adamed Group. It recorded a 15 per cent increase in export revenues in 2016 and aims to constantly grow its foreign sales.

Dat Vi Phu was established in 2004 and manufactures nearly 300 medicinal products in most therapeutic classes. It is the fastest-growing company in Vietnam’s pharmaceutical market and exports its products to the Philippines, Cambodia, and Myanmar. Located in southern Binh Duong province near Ho Chi Minh City, it currently employs some 200 people.

 

 

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Two billion dollar projects in Haiphong calling for investment

VIR

 

The two projects are a railroad construction to Haiphong International Port and a professional industrial park for Japanese companies.

The length of the railroad construction to Haiphong International Port is 57 kilometres and its width is 1.4 metres. The project would run under the formats of public-private-partnership (PPP) and build-operate-transfer (BOT) formats.

The total investment of the project is estimated at $1.6 billion, part of which will be financed from Japanese official development assistance (ODA) loans. It is expected to be implemented in until 2030 to construct 16.56 kilometres of railway, 26.9 kilometres of bridges, and seven new railway stations.

The main line, which is 35.7 kilometres long, starts at the new Hung Vuong Railway Station (equivalent to Km95+215 of the Hanoi-Haiphong railway route), goes through Dinh Vu Industrial Zone (IZ) (now known as Deep C IZ), crosses Nam Trieu Seaport, and arrives at Haiphong International Port in Cat Hai Island.

The secondary line, which is 7.78 kilometres long, starts at South Dinh Vu Railway Station (equivalent to Km23+940) and will run parallel with the main line until Km26+337, then turn left towards Dinh Vu Seaport and arrive at Deep C IZ.

After launching, it is estimated to transport 30 million tonnes of cargo per year by 2020 and 95 million tonnes per year by 2030.

The second project to call for foreign investment is the professional industrial park for Japanese companies in the north, located on an area of 300-400 hectares in Dinh Vu-Cat Hai Economic Zone.

Earlier, the Haiphong People’s Committee announced the general master plan of Dinh Vu-Cat Hai Economic Zone (EZ) until 2025. Accordingly, the zone, which has a total area of about 22,540 hectares, will become a multi-sector economic zone of the North Central Coast and the whole country, in order to become an international logistics seaport.

 

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REAL ESTATE

Vietnam posting among world's most attractive office yields

VET

 

Vietnam has proved again to be the market offering the most attractive office yields in the world, according to the latest Savills Office Yield Spectrum 2H 2017 report.

Transaction volumes by overseas investors increased by between 1 per cent and 39 per cent in the first half of 2017 year-on-year, remaining in positive territory. The global search for yield has traditionally been one of the main reasons behind investment in the Asia-Pacific office sector.

The Top 2 markets offering the highest yields in the world remained Vietnam’s gateway cities: Hanoi at No. 1 position with an 8.65 per cent yield and Ho Chi Minh City at No. 2 position, with 7.86 per cent. “Vietnam’s office market has shown excellent performance, particularly in Grade A, with occupancy rates reaching over 95 per cent in the CBDs of the two cities,” said Mr. Neil MacGregor, Managing Director of Savills Vietnam.

mbc

“In light of various integration opportunities, economic reforms, and booming economic growth in the past few years, Vietnam’s economy has welcomed consistently increasing flows of foreign direct investment (FDI) into the country which, in turn, has helped secure sustainable growth,” he added.

In hosting the year-long APEC Vietnam 2017 meetings, the country had a great opportunity to showcase its investment potential in 2018. South Korea, Japan, Singapore, Taiwan, and Hong Kong are some of the leading countries in foreign investment and are all members of APEC, proving the importance of this forum to Vietnam.

As Vietnam’s economy thrives, the market will continue to see further interest in all real estate sectors, with a focus on office and hospitality, driven by increasing FDI, booming tourism and, more recently, industrial and logistics real estate developments.

For three years running, optimism has dominated the Asian office sector as cheap money has continued to flood local markets and rents and capital values have continued to rise across the region.

The increasing capital inflows have resulted in cap rate compression to decade lows but buoyant demand has inevitably led to more new prime office completions and vacancy rates are finally beginning to creep up.

Investors have generally adopted a positive outlook for local office markets, their confidence bolstered by strong economic growth expectations. The most active markets have been China, followed by Japan and Hong Kong. However, limited stock available for sale in prime areas has meant that investors have increasingly turned their attention to development projects in secondary locations.

 

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Mixed-use development boom in Vietnam’s cities

VIR

 

During the last 10 months, Vietnam continued to see strong interest from developers for large-scale, mixed-use projects with residential components in major cities.

In mid-November, Singapore-based CapitaLand announced that it paid $38 million to acquire a new residential project located in Ho Chi Minh City’s District 4. This acquisition is CapitaLand’s 11th project in Vietnam so far.

According to Chen Lian Pang, CEO of CapitaLand Vietnam, 2017 has so far been a record year in terms of growth for CapitaLand in Vietnam, with home sales in the year’s first nine months surpassing those of fiscal year 2016 by close to 50 per cent.

“Beyond the residential market, we have made strategic inroads and expanded our footprint in the country with prime assets in gateway cities,” Chen said.

In September, VinaLand Limited – the real estate investment arm of Vietnam-based asset manager VinaCapital – transferred its stake in VinaSquare, a mixed-use 3.1-hectare development site in Ho Chi Min City’s District 5, to Tri Duc Real Estate for $41.2 million.

In addition, its 182ha My Gia, one of the largest township projects in the central city of Nha Trang, was also unloaded by VinaLand for over $11 million.

In August, Anpha Holdings, a Vietnamese real estate development firm, acquired nearly 100 per cent of Nova Galaxy, a subsidiary of the listed developer Novaland.

In Hanoi, Growing Sun Investment acquired the 4.2ha Diamond Rice Flower complex project from the listed company Kinh Bac City Group.

In a similar move, FLC Group won a bid for the land-use rights of the 6.4ha DM1 land plot, located in South Tu Liem district, for nearly $38 million. They plan to build townhouses, villas, and apartments on the parcel.

According to a recent report released by Savills Vietnam, the Vietnamese property market is trending upward, across all sectors, with a particularly positive outlook for the office-space sector.

With strengthening demand on the back of healthy foreign direct investment and robust GDP growth, Savills Vietnam expects to see extremely low vacancy rates across all office grades, with average rental growth exceeding 8 per cent per annum in the next three years.

Vikram Kohli, executive director of Business Operations and Strategy at CBRE Southeast Asia, said that the real estate market in Vietnam will remain a destination for foreign investment – especially from APEC members – in the coming time.

“For developed countries like Japan, South Korea, and Singapore, the profits from real estate projects are not as attractive as they are in emerging countries. Therefore, investors in more developed countries are willing to diversify their portfolios in emerging markets like Vietnam,” Kohli said, adding that the Vietnamese government has recently enacted a policy to encourage foreign investors to join the local market through mergers and acquisitions (M&As).

However, in order to make the M&A market in real estate more attractive to foreigners, there needs to be more product diversity to provide foreign investors with more choice. Furthermore, increased transparency and legal protection for contracts are also needed to properly develop the M&A real estate market, which has seen increased participation from foreign developers in Japan, South Korea, and Singapore. These buyers are interested in large-scale mixed-use developments comprised of apartments, serviced apartments, retail, and office space in Hanoi and Ho Chi Minh City.

 

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ENERGY&MINING

Foreign capital inflows perked up by multibillion-dollar power plant licensing

VIR

 

The Vietnamese government’s granting of investment certificates to thermal power plants with a total investment capital of $8.37 billion contributed to raising the total value of foreign investment capital in Vietnam to $33.09 billion in 11 months of 2017. 

According to information published by the Khanh Hoa People’s Committee, Summitomo Group from Japan has been granted the investment registration certificate for its Van Phong 1 coal-fired thermal power plant with a total investment capital of $2.58 billion and capacity of 1,320 megawatts after 11 years of waiting.

In 2006, Sumitomo proposed its interest in developing a 2,640MW thermal power plant on an onshore and offshore area of 350 hectares. The construction would be divided into two phases, with the first carrying an investment capital of over $2 billion. In 2009, the government agreed to Sumitomo to implement the project under the build-operate-transfer (BOT) form.

However, during the process of completing the investment procedure, the investor faced numerous difficulties, especially in the negotiation of the BOT contracts, thus construction works have yet to be kicked off.

Besides, the project required a large area, leading to difficulties in site clearance. Additionally, the long-delay in construction after completing site clearance also made residents extremely anxious.

At present, having received the investment certificate, the investor expects to accelerate completing the remaining procedures so that the construction can be kicked off in early 2018.

Along with Van Phong 1 thermal power plant, two other large-scale thermal power plants received the investment certificate since early 2017. These include the $2.79-billion Nghi Son 2 located in the central province of Thanh Hoa and the $2.07-billion Nam Dinh located in the northern province of Nam Dinh. Both projects would be develop under the BOT format.

Regarding the contribution of thermal power plants to foreign investment capital inflows, for 11 months of this year, the power production and distribution sector ranked second on the list of industries receiving the largest FDI in the country, following the manufacturing and processing sector, with a total investment capital of $8.37 billion, making up 25.3 per cent of total foreign investment inflows.

According to statistics published by the Ministry of Planning and Investment’s Foreign Investment Agency, in the 11 months of this year, Vietnam received $33.09 billion in foreign investment capital, up 82.8 per cent on-year.

Notably, there are 2,293 newly-registered projects worth $19.8 billion, up 52 per cent compared with the same period last year.

1,100 existing foreign invested projects raised their investment capital with the total value of $8 billion, posting a year-on-year increase of 57.6 per cent. Foreign investors also spent $5.29 billion (up 57.6 per cent) buying stakes in local companies.

 

 

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Agreement on the roadmap for implementing Bao Vang gas field

VietnamEnergy

 

According to information from Petrovietnam (PVN), November 27, 2017, in Dong Ha city (Quang tri province), PVN mission headed by General director Nguyen Vu Truong Son had a working meeting with Gazprom (Russia) and Quang Tri Provincial People’s Committee (PPC) on perspective of Bao Vang (Gold Panther) gas field. At the meeting, the parties have agreed the roadmap and assigned concrete responsibilities for preparing project investment.

Speaking at the meeting, Mr. Nguyen Vu Truong Son said, development of gas processing plant and power plant using gas from Bao Vang field will contribute significantly to socio-economic development of Quang Tri province and the provinces in central region of Vietnam.

And Quang Tri PPC Chairman Nguyen Duc Chinh said, recent time the province discussed with Ministry of Industry and Trade and reported to Prime Minister Nguyen Xuan Phuc on the issues related to Bao Vang gas project. The Prime Minister greatly supported harrying up deployment of this important project. Besides, Quang Tri PPC has also signed a MOU with Gazprom International and committed to closely co-ordinate and create the most favorable conditions for the partners to implement the project.

PVN, Quang Tri PPC and Gazprom International have agreed to sign a MOU on the results of the meeting with a roadmap and assigning concrete responsibilities of the related parties for implementing the next speps of the project.

According to information from the Vietnam Energy Magazine, Bao Vang gas field has discovered by the Joint Venture Operation Company “Vietgazprom” from October of 2010. The products of the field include natural gas with 104.5 thousand cube meters per day and condensate with 7.32 cube meters per day, and no CO2 and H2S.

 

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LEGAL

Policies on transport infrastructure construction investment to be finalized

VLLF

 

Deputy Prime Minister  Trinh Dinh Dung has asked the Ministry of Transport (MoT) to finalize transport infrastructure construction mechanisms and policies, including public-private partnership (PPP) and build-operate-transfer (BOT) investment projects, particularly mechanisms for mobilizing capital from credit institutions for transport infrastructure development, and state budget-funded investment policies.

He also required the MoT to revise national, regional and local transport infrastructure development strategies, master plans and plans, which prioritize investment in projects and works of great socio-economic development significance, particularly the north-south national expressway sections.

The MoT was also assigned to raise the quality of legal documents aimed at enhancing the state management of transport infrastructure projects, particularly in the selection of their contractors and control of their quality throughout the course of building and operation.

He said the MoT should regularly review all BOT projects and speed up the setting up of non-stop electronic toll collection booths on BOT projects nationwide.

The Deputy PM also asked the Ministry of Planning and Investment (MPI) to submit to the Government a decree amending and supplementing government decrees No. 15 and 30 of 2015 on the transparent and effective management of PPP projects.

He also demanded the MPI to clearly provide for the right of transport infrastructure and service users to choose to use PPP investment projects.

 

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Population law must protect elderly: experts

VNS/VLLF

 

The nation’s population policy must be integrated with other socio-economic factors including national defense and security to ensure rapid and sustainable development, experts said at a policy dialogue on population and sustainable development organized on November 29 in Hanoi to discuss the draft Law on Population.

The draft law will be submitted to the fifth National Assembly session for discussion.

Truong Hai Cuong, member of the Vietnam Fatherland Front (VFF) Central Committee, said the country’s population was aging rapidly, so the draft law should have provisions that ensure the rights, interests and responsibilities of the elderly, and encourage senior citizens to do suitable jobs, based on their health and experience.

Quach Sy Hung, also with the VFF, said the draft law should have clear regulations on responsibilities of relevant ministries and agencies on family planning services and taking care for old people.

International principles and commitments should be adhered to in building population policies, said Nguyen Ngoc Quynh of the United Nations Population Fund (UNFPA) in Vietnam.

She said the draft law should meet international standards and comply with human rights principles, including the right to decide to have babies, time to have babies and the number of children.

Regulations should ensure the provision of full and clear information, education and qualified services on reproductive health, with priority given to population in disadvantaged areas, she said.

Dialogue participants also discussed and shared their experiences on the development and implementation of population and development policies; raising awareness and changing societal behavior; and integrating population variables into development policies.

The dialogue is organized by the VFF, the UNFPA in Vietnam, the General Office for Population and Family Planning and the Ministry of Health.

 

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