Speculators cause domestic gold hike

HCM CITY - The price of gold on the local market has risen due to possible speculation rather than a supply shortage, according to Nguyen Van Giau, governor of the State Bank of Viet Nam (SBV).

The global gold price set new records in the past few days, as did the domestic gold market.

The SBV and the Viet Nam Gold Association had kept a close watch on the market in the last few days, and discovered there was no shortage of gold, Giau said, adding that speculation was possibly the cause for the price rise.

Domestic gold prices in August and the first half of September were lower than the world price. But currently the domestic price is VND400,000 per tael higher than the global price.

The SBV was working with other agencies, including the police and market management, to discover the reasons behind the price hikes.

"With this kind of sensitive item, our policy is not to completely ban gold imports, but gold companies are not permitted to import any volume they want," Giau said.

"We are establishing a management framework for gold trading and imports so that it is suitable with a market economy. We will collect ideas from ministries and industries when we complete it."

Nguyen The Hung, general director of the Viet Nam Gold Investment and Trading Company, said the gold price on the domestic market would be equal or even lower than the world price if the SBV permitted gold importers to import gold.

However, the Government has stopped granting permits for gold imports, which indicates that it no longer considers gold an essential item, according to an expert.

In addition, the higher gold price had not affected people's lives since few people conducted their transactions in gold, he said.

Prices

The gold price on the domestic market yesterday morning fell to VND31.15 million (US$1,597) per tael (1.2 ounces) after it reached a record of more than VND31.3 million ($1,605) per tael on Wednesday, following an upward trend in global gold prices.

On Wednesday, most gold shops in HCM City raised their price by more than VND700,000 ($21.3) over the Tuesday price to VND31.25-31.36 million per tael.

Yesterday morning, SBJ gold was buying and selling at VND31.15 million ($1,597) and VND31.18 million ($1,599) per tael, respectively.

Sai Gon Jewellery Holding Co yesterday bought the precious metal at VND31.14 million and sold it at VND31.18 million per tael, a reduction of VND130,000 - VND170,000 against Wednesday.

The global gold price on Wednesday reached an all-time high of $1,313 an ounce on speculation that a global economic recovery would stoke inflation.

In Asia, the metal slightly fell yesterday morning to $1,309 an ounce.

The weakening of the US dollar on the world market has also contributed to the gold price hike, analysts have said. - VNS

Target to hold prices and curb power cuts

HA NOI - The Government will instruct relevant agencies to carry out synchronous measures to control prices, while overcoming power shortages, Prime Minister Nguyen Tan Dung said at the Government's regular monthly meeting yesterday.

Participants at the meeting were told that the Prime Minister would soon issue an instruction on price controls in an attempt to stabilise the market up to early 2011.

Dung said a nationwide conference would be held on implementing the instruction in a bid to fulfil this year's socio-economic targets, such as controlling inflation.

He stressed the need to maintain a stable prime rate, to manage the monetary system in an active but flexible way and to keep the price of essential commodities and medicines stable.

The Prime Minister asked ministries, cities and provinces to reserve enough goods to serve public demand during the lunar new year celebrations.

In an attempt to overcome power shortages, Dung urged electricity suppliers - particularly the Electricity of Viet Nam - to take drastic measures to speed up the construction of power plants, while buying electricity from neighbouring countries and cutting down on waste.

Participants at the meeting heard that the socio-economic situation had developed positively in the first nine months of this year. The economy had recovered fairly quickly after the global downturn and performed better than the same period in 2008 and 2009.

Specifically, the gross domestic product growth averaged 6.52 per cent in the first nine months, while industrial production was higher than the whole year's plan.

Export turnover was about US$51.5 billion in the first nine months, an increase of 23 per cent compared with the same period last year and four times higher than the National Assembly's approved target of over 6 per cent.

Total import turnover was $60 billion, an increase of 22 per cent compared with the same period last year. The trade deficit continued to narrow down and stood at $8.5 billion - equal to 16.7 per cent of the total export turnover.

The consumer price index rose 8.64 per cent compared with the same period last year.

Despite much progress, the economy was still facing many difficulties, the conference heard.

The price of consumer goods had increased, as had the price of gold. The sluggish performance of some major world economies continued to affect the country's export growth.

Production and trading enterprises were still finding it difficult to borrow money because of high interest rates, the Prime Minister said. Making matters worse, the country also has to cope with natural disasters such as typhoons, flooding and epidemics.

To overcome these difficulties, the Government has asked ministries, industries, cities and provinces to ensure there are enough supplies of commodities and that prices are stable, while disbursing investment capital for projects using Government bonds and the State budget.

The meeting reviewed socio-economic development in the first nine months and discussed strategies for the remainder of 2010. - VNS

Expo promotes regional tourism

HCM CITY - A three-day annual International Travel Expo aimed at boosting 3CODE (Three Countries One Destination) tourism programme covering Viet Nam, Laos and Cambodia opened in HCM City yesterday.

Held at the Saigon Exhibition and Convention Centre in District 7, the event attracted 155 "buyers" from 35 countries and 173 sellers (enterprises and departments offering products and services).

Besides buyers from traditional markets, organisers aimed to explore new markets in North Europe, Spain, Italy and the US.

"This year's expo welcomes Myanmar, preparing to form the new 4CODE," said La Quoc Khanh, deputy director of the HCM City Department of Culture, Sports and Tourism.

"We hope to see all the six countries of the Greater Mekong Subregion in the coming expo, to join hands and make the region more interesting in the eyes of international tourists," Khanh said.

Viet Nam's national flag carrier as well as the official carrier of the event, Vietnam Airlines, offered up to 85 per cent discounts on selected international routes.

The carrier also introduced its "Welcome Christmas in Europe" tour packages at attractive prices.

Thailand organised a conference introducing its Amazing Thailand campaign. The Tourism Authority of Thailand (TAT) targets 14 million arrivals by the end of this year, and 15.5 million international tourist arrivals next year.

TAT and the Viet Nam National Administration of Tourism will hold a working section on Sunday.

Apple iPhone 4s snapped up on launch day

CMC - Many people had to leave the long queues without the sought-after Apple iPhone 4 on Thursday as leading carriers Viettel and Vinaphone sold a mere 1,000 units in Hanoi and HCMC.

Vinaphone's retail store at 80 Nguyen Du Street in HCMC's District 1 was overcrowded with Apple iPhone 4 enthusiasts who began queuing at 5:30 a.m., but just some of them succeeded in buying the phone.

Le Huu Minh Nhat from Tan Binh District, the first buyer of the iPhone 4, told the Daily that he had ordered the phone at the Vinaphone website before the network announced the phone price on Wednesday.

The 16GB version of the iPhone 4 costs VND13.4 million and the 32GB version sells for VND15.6 million, including a VND600,000 deposit.

Vinaphone just sold the smartphone to post-paid subscribers who placed online orders at iphone.vinaphone.com.vn.

Pham Ngoc Tu, marketing manager of Vinaphone, told the Daily that the company sold out the iPhone 4 in the first day of going on sale given a limited volume."We imported a small quantity, so post-paid subscribers were given priority. We will continue to import more to meet the demand," Tu said.

Tu said Vinaphone originally planned to sell the iPhone 4 at three locations - 384 Xa Dan, Dong Da District in Hanoi, 4 Nguyen Van Linh Street in Danang and 80 Nguyen Du in HCMC's District 1, HCMC. But due to large crowds at these outlets, Vinaphone added a fourth shop in Hanoi.

In the same situation was Viettel whose 20 retail shops sold out the iPhone 4 on the launch day on Thursday. The company sold a limited number as well.Different from Vinaphone, Viettel sold the smartphone to both pre- and post-paid subscribers and offered a price which was VND100,000 per unit lower than Vinaphone. Viettel customers bought the 32GB version for VND15.5 million only, compared to the VND15.6 million quoted by Vinaphone.

For clients who want to buy the locked version of the iPhone 4 without any binding terms of service, they will place a deposit of VND599,000 at Viettel.

Viettel on Thursday had to hold lucky draws for clients wishing to buy the phone as there were more orders than its available stock. By 9:00 am on Thursday, Viettel announced it had gone out of stock.Viettel, Vinaphone and MobiFone inked deals with Apple to distribute the iPhone in Vietnam early this year. But MobiFone has yet to announce its intention to sell this favorite Apple device.

HSBC expands to central region

HCMC - HSBC Vietnam on Thursday opened a branch in Danang City to expand its geographical reach to the central region.

This is the second branch which the foreign bank has set up this year. The bank's first branch debuted in Can Tho City in southern Vietnam's Mekong Delta just last week.

Thomas Tobin, CEO of HSBC Vietnam, said in a statement, "Given Danang's positioning as one of the country's fastest-growing economic centers, as well as one of the most attractive hubs for foreign investment, we are looking forward to playing a role in this dynamic city's exciting business sector."

With the new branch at the Indochina Riverside Tower, 74 Bach Dang Street, Hai Chau District, corporate customers in Danang and neighboring provinces can gain access to HSBC's business banking products, including commercial banking, global banking, payment and cash management, and trade finance, among others.

Vietnam and Korea trade and investment ties will grow strongly

Reported by Ngoc Tran

Wednesday, September 29,2010,21:50 (GMT+7)

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Vietnam and Korea trade and investment ties will grow strongly

Dug Gyou Bok

Dug Gyou Bok, deputy director/Asia & Oceania Team and ASEAN specialist of the Korea Trade Investment Promotion Agency (KOTRA), says Vietnam has made use of the ASEAN-Korea Free Trade Agreement (FTA) to spur exports and attract investments from Korea. The Saigon Times Daily spoke with him about FTA-related issues.

The Saigon Times Daily: What is the FTA policy of Korea?

- Dug Gyou Bok: Korea is very active with other countries. We have FTAs with more than 40 countries. Recently we signed FTAs with the United States and European Union which itself consists of a lot of countries. We should promote our country because, as you can see, the import-export rates from ASEAN to Korea and from Korea to ASEAN are too different. In the first case, the rate is around 50% and 10-15% in the latter case. We just wondered why and eventually realised that many Asian people do not recognize AK-FTA yet.

That's why the Korean government is trying to promote this agreement in other countries and we are doing the same. KOTRA serves as a bridge between Korean exporters and oversees buyers. We are highly competitive in a range of output from traditional manufactured goods to high-tech products. Of course, we are interested in FTA success.

The agreement between Korea and ASEAN members took effect for goods in 2007 and services and investment last year. ASEAN, as the Association of Southeast Asian Nations is often known, comprises 10 countries - Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Someone said Vietnam is the best partner of Korea. Can you explain why?

- Vietnam has a similar culture to Korea's. They are both based on Confucianism. Vietnam is very diligent, with a fast productivity, and quick to adapt to new systems. That's why a lot of Korean businessmen want to work with Vietnamese people. That's why they want to invest here. And in another sense we found that Vietnam's industry is growing fast and also the rate of general consumption is increasing. So we are looking also at the general Vietnamese market of consumers.

Vietnam's exports increased 32.5% in the first seven months of 2010, while the average export growth among ASEAN members was about 24% in the same period. And the country's exports to South Korea grew 16.3% in 2009. Furthermore, the multilateral agreement pushed Vietnam to export more telephone set parts and wood chips, products that have also brought in investments from Korea.

Consequently, Vietnam's exports to Korea in these sectors grew 98.6 and 600% from January to July 2010 respectively, while traditional goods like seafood, shoes and agricultural products increased stably. And on the other hand, Korean exports to Vietnam increased 35.2% in the first seven months of this year, more than three times higher than its imports from the country during the same period.

And I would like also to say that Yon-Jip Jung, deputy general director for Free Trade Agreement Policy under the South Korean Ministry of Foreign Affairs and Trade, said Vietnam was one of the Korea's best partners in the Southeast Asian bloc, and for this reason he wanted to improve bilateral trade and investment relationships. That is the reason beyond the recent decision of governments of Korea and Vietnam to launch a joint committee to study the possibility of an FTA.

An FTA between Korea and ASEAN went into effect in June 2007, but a bilateral trade deal is expected to provide a higher level of market liberalization for trade between the two countries. Just to give an example of the importance of your country, Vietnam was Korea's tenth largest export destination as of last year at over seven billion U.S. dollars.

Do Korean businessmen want to invest in the Vietnamese consumer market only?

- We want to capture the Vietnamese market but also invest here as a production base, because actually Vietnam is the gate to ASEAN countries and can also be the gate to China, which represents another huge market. And Vietnam is also very close to us. In many ways Vietnam is a really promising country to us, but at the same time I think it is very hard to find human resources in HCMC, so Korean businessmen move to other cities like Hanoi or even to Indonesia and in general in countries with more manpower.

What is your view about Korean and Vietnam trade relationships?

- They are stable and quick. Big Korean companies made a lot of investments here, such as Posco. There will be more investments in the future and an increase in the trading of goods and services as well. Korean companies here will use services in order to operate. And later, I reckon, many Vietnamese companies could move and invest in Korea too. A similar thing is happening in Malaysia: many businessmen there decided to invest in Korea. So as you can see, in a few years there can be a sort on integrated-interactive systems of investments, services and trading goods between Korean and Vietnam.

It's sufficient to see the Korean investments in Vietnam: in 2009 they increased slowly, but in the first half of 2010 the amount was up to US$27 million, 1.8% more than 2009, so that means by the end of this year the total amount of investments will be 3-4 times bigger than in 2009. Why did it happen? It is because the big Korean companies like Posco knew a new FTA between the two countries was coming and they saw all the opportunities of such a liberalization agreement. And the Korean companies are interested in investing in Vietnam also because resent studies show Vietnamese industry is growing in every field.

Are there many Vietnamese in Korea? What do you think about that?

- Many Koreans think Vietnamese people have similar character and that is true. As you can see in this occasion, we get along very well as compared to other countries. That's why we try to invest more and make more deals with Vietnamese.

Is there any Vietnamese company trying to create or develop a new business? In the food industry for instance?

- There are actually two "Pho 24" stores in Korea which offers the typical Vietnamese noodles. Your noodles are very popular in Korea, my wife is one of your biggest fans.

This is your second visit to Vietnam. You were in Hanoi earlier. What do you think about Vietnam?

- I love Vietnam and it is one of my favourite countries in Asia. But Indonesia is still at the top of the list because I have lived there for three and a half years. But Vietnam could be likely the second.

HSBC also has a range of personal financial services available for individual clients, including deposits and savings account transactions, loan products, international credit and debit cards.

Like other outlets across Vietnam, the Danang branch is launching a nationwide "Great Offers" promotion, offering customers discounts, bonus interest rates, and gifts across HSBC's personal financial services products until October 31 this year.