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BUSINESS IN BRIEF 23/7   2009-07-23 - VietNamNet/VNA

First vapour heat treatment factory inaugurated

Japan-wholly invested Yasaka Fruit Processing Company on July 22 inaugurated a vapour heat treatment facility in Thuan An district, southern Binh Duong province.

The 4 million USD factory, the first of its kind in Vietnam to apply the vapour heat treatment technology for exported fruits, was installed with automatically production lines.

Initially, the factory will apply the technology for dragon fruits to export to Japan, Yasaka Company’s Director Watanabe Wataru said.

Coal industry ups output to 43 million tonnes

The Vietnam National Coal and Mineral Industries Group (Vinacomin) has officially raised its coal production target by 3 million tonnes to 43 million tonnes this year.

Of the total, domestic demand will swallow up more than a half while the remainder will be exported.

Vinacomin said it decided to adjust its original production output to meet increasing domestic demand, especially in the power, fertiliser, paper and cement industries – the country’s four largest coal consumers.

This year, Vinacomin estimated that the power industry would need roughly 8.4 million tonnes of coal, while cement makers would use 5.6 million tonnes. The rest would be consumed by fertiliser and paper production industries.

To meet the new output target, the group said it had instructed its affiliates to speed up coal exploitation and to get new mines up and runnings as well as expand and modernise existing mines Vang Danh, Khanh Hoa and Khe Cham.

In the first half of 2009, the coal industry churned out 20.3 million tonnes of coal, down 5 percent over the same period last year. Including stored coal, the country sold 21.5 million tonnes, of which 12 million tonnes were exported, Vinacomin said.

Vinacomin deputy general director Nguyen Chien Thang said as of next year, the coal industry would start to cut coal exports to meet rising domestic demand, adding that the country would export coal only when domestic supply exceeded local demand.

Thang estimated that the country would need roughly 43.7 million tonnes of coal next year. The figures for 2015 and 2025 would be roughly 61.4 million and 76.9 million tonnes, respectively.
To meet demand at home, especially for the power industry, the country will have to import roughly 25.5 million tonnes of coal by 2015. The import figure for 2025 will be roughly 27 million tonnes.

Vietnam has planned to build 13 large-scale, coal-fired power plants in the next seven years to feed electricity consumption.

However, there has been some concern that power plants in central and southern regions would have to import coal so as to ensure production.

Thang warned it would be difficult to maintain a stable long-term supply from abroad because foreign coal producers would not sign long-term contracts for large volumes.

Deputy Minister of Industry and Trade Do Huu Hao said in the short-term, coal for power plants would still be supplied from home.

The country could expect exploitation plans underway in the Red River coal basin to supply domestic demand in the future.

Newly launched VND-Index to track relative value of dong

Bien Viet Securities Co has joined forces with the RoK Woori Investment& Securities Ltd to launch a new index to track the trade-weighted value of the Vietnam dong.

The VND-Index would aim to measure the strength of the dong relative to other currencies from its major trading partners, including the US, EU, Japan, China, Taiwan, Singapore and the RoK, according to Bien Viet Securities.

Last year, trade with these countries and territories accounted for 70 percent of Vietnam ’s total export value and 74 percent of its import value, according to the Ministry of Industry and Trade’s data.

The index has been designed to include a daily nominal index and a monthly real index adjusted for inflation-each set at a starting - point of 100, computed as the geometric mean of the bilateral exchange rates of the included currencies. The weight assigned to the value of each currency in the calculation will be based on trade data and will be annually updated.

“One of the major reasons that VND-Index is chosen to start at a basis point of 100 is that the country’s trade deficit, around since 2006, was erased in January, when exports exceeded import value by 467 million USD,” said Bien Viet Securities CEO Vu Duc Nghia in a press release.

Initial calculations have shown that the dong was stable in June and July, a good sign for the economy, Nghia said, noting that the index would be valuable tool for fund managers in adjusting their investment portfolios.

VJEPA - New opportunities for Vietnam’s aquaculture exports to Japan

The Vietnam – Japan Economic Partnership Agreement (VJEPA) will create huge opportunities for the penetration of Vietnam ’s aquatic exports into Japan ’s market as it officially comes into force, said aquaculture sector experts.

Experts said that 86 percent of agricultural, aquatic and forestry exports from Vietnam to Japan will enjoy tax incentives within 10 years after the VJEPA takes effect.

Vietnam ’s shrimp exports to the Eastern Asian country will be exempt from duty immediately while its octopus exports will be eligible for this privilege five years later.

Japan is the largest import market for Vietnam ’s frozen shrimp, which had, by the end of June, raked in nearly 200 million USD from Japan-bound exports, making up 32 percent of the country’s total aquatic export value.

To make a smooth entry into Japan ’s market, aquaculture sector experts have recommended that Vietnamese exporters pay more attention to the quality of aquaculture exports, strategies on aquatic processing, brand name awareness and trade promotion.

They added that in the near future, Japan will support Vietnam to build an aquaculture processing centre meeting international standards and the two countries will set up a joint committee to overcome any obstacles relating to the quality, hygiene and safety of products.

The negotiation on the VJEPA started in January 2007, shortly after the accession of Vietnam to the World Trade Organisation. After nine official talks and a number of unofficial talks, the two nations reached an agreement in principle in September, last year and officially signed the accord on December 25, 2008.

VJEPA is Japan ’s 10th free trade agreement and the first bilateral free trade agreement for Vietnam since entering the WTO.

Vietnam gets involved in international e-commerce

The Deputy Minister of Industry and Trade, Bui Xuan Khu, has said that Vietnam is actively involved in international e-commerce and is linking up with other countries so it can catch up with the rest of the world.

Addressing a seminar on building up capacity to protect privacy during e-commerce transactions held in Hanoi on July 22, Deputy Minister Khu said that the nation has taken part in a programme to identify ways of protecting privacy in APEC e-commerce.

This will help Vietnam to create effective privacy-protection policies in line with the country’s situation and help it avoid barriers to the flow of information.

The seminar, co-hosted by the Ministry of Industry and Trade and the Centre for Information Policy and Leadership (CIPL), is part of a number of activities to bring in a programme on privacy protection in e-commerce among APEC member economies.

The US Ambassador to Vietnam , Michael Michalak, emphasised the importance of the seminar’s theme, saying that it will help Vietnam and other countries worldwide to build a typical e-commerce model.

Ensuring safety and privacy will open up more e-commerce opportunities, attract investment and help raise living standards in Vietnam and other APEC member economies, the US diplomat said.

Experts from Australia , the Philippines and the US also discussed issues relating to privacy protection in Vietnam , the safety of information and the APEC privacy framework.

Although Vietnam is ranked poorly in e-commerce, e-commerce has already been widely applied in enterprises across the country, said the ministry.

The number of enterprises that have websites rose from 31 percent in 2005 to 45 percent in 2008 and 99 percent of businesses are connected to the Internet.

Vietnam, Indonesia work together in fisheries

Officials from the Vietnamese and Indonesian fisheries sectors will discuss maritime-related issues including law enforcement in the fisheries sector and how to monitor and solve illegal fishing at an upcoming workshop in Ho Chi Minh City .

Both countries will also focus their discussions on policies and opportunities to develop the fishing industry and investment in the fisheries sector.

The July 31 and August 1 workshop on cooperation in the fishing industry between Vietnam and Indonesia will be a good chance for Vietnamese fishery businesses and fishermen to share experiences in the field.

It is also an opportunity for both countries to look at the possibility of working together in the fishing industry, which would serve as a foundation for the two nations to conduct research and draw up policies for bilateral cooperation in accordance with international regulations and the laws of both countries.

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