Gov’t pay heed to take care of workers’ lives

A 65km section of the 140km Da Nang-Quang Ngai Expressway project will be put into operation in August. (Photo: VNA) Da Nang (VNA) - The Vietnam Expressway Corporation (VEC) will put the first 65km road section of the 140km Da Nang-Quang Ngai Expressway into operation on August 2. This is the first expressway in the central and central highlands region. A VEC official said that the first stage of the project – the 65km section from Tuy Loan in Da Nang city to Tam Ky city, the capital of Quang Nam province, has been completed. The four-lane section with two emergency lanes will allow vehicles to travel at 120km per hour, reducing travel time between Da Nang and Quang Ngai province. VEC’s General Director Mai Tuan Anh said the road was an important part of the National North-South Highway, and its second stage was scheduled for completion later this year. He said VEC would also collect tolls from all vehicles travelling on the Tuy Loan-Tam Ky section. The Da Nang-Quang Ngai Expressway project commenced construction in 2012 with a total investment of 29 trillion VND (1.4 billion USD), of which 635 million USD was sourced from the World Bank and 673 million USD from the Japan International Cooperation Agency (JICA). The 26m-wide four-lane link, running through Da Nang city and Quang Nam and Quang Ngai provinces, will connect industrial parks in the region and help boost transportation in the East-West Economic Corridor that…... [read more]

HCMC sees more FDI flowing into IPs Le Hoang By Le Hoang - The Saigon Times Daily HCMC – The first nine months of the year saw fresh foreign direct investment (FDI) approvals in export-processing zones (EZs) and industrial parks (IPs) in HCMC picking up due mainly to expansion plans by operational companies. FDI flows in the city’s EZs and IPs totaled more than US$341 million in January-September, up 114.27% year-on-year, the HCMC export processing and industrial zones authority (Hepza) reported. According to Hepza, the strong rise in FDI is ascribable to the operational projects that are expanding their operations, with 23 projects in EZs and IPs adding nearly US$278 million, jumping over 110% year-on-year. Notably, Japan’s Saigon Precision Co. Ltd. in Linh Trung II EZ adjusted up its capital by US$129 million to expand and upgrade production lines, renovate technology and construct its fourth factory covering 2.2 hectares. The firm’s current investment capital is US$219 million. Nidec Tosok Vietnam, a subsidiary of Japan’s Nidec Corporation, has poured an additional US$95.8 million into its plant’s expansion in Tan Thuan EZ, taking its total investment to US$205.6 million. Kamijukkoku Takashi, general director of Nidec Tosok Vietnam, explained the new capital injection would go to procuring more machinery to raise the plant’s capacity by 50% to meet rising global demand for precision parts for automobile production. According to local experts, the investment expansion by FDI enterprises in the EZs and IPs is a preparatory step for a pickup in the country’s economic…... [read more]

In mid 1980s, an important political and economic event took place in Vietnam. The eight conference of the 5th Party Central Committee in June 1985 identified the goal of socialist-oriented market economy for Vietnam. At the time, Vietnam had marked 10 years of Southern Liberation and National Reunification, but faced numerous difficulties. Chronic famine and the heavy consequences of the past two wars against French and American imperialists had created problems for the war-torn country. Several years later, the socialist regime in the former Soviet Union and other East European countries collapsed. Vietnam had to select between two options: renewal or death. In fact, the Renewal process formerly began in the agricultural sector with the “allocation” mechanism under the Party Resolution 10 (formerly known as Khoan 10), and the Party leadership at all levels, from production units to district and provincial Party Committees, became the vanguard in the campaign. But the country actually ushered in the Renewal process after the 6th National Party Congress in December 1986. Ten years later, Vietnam fulfilled or even surpassed all socio-economic development targets set for the 1991-1995 period. The country really escaped the economic crisis. In the past 10 years, Vietnam’s economy has developed steadily with an annual GDP growth rate of 7.5 percent. Notably, the country’s GDP growth rate in 2005 reached 8.4 percent, with a GDP per capita of US$640, an increase of 2.2 times against 1995.To develop the national economy, Vietnam has played to the full strength of its internal sources,…... [read more]

Preferences for 130 industrial parks to be abolishedIn the eyes of US negotiators, Vietnam has provided quite a lot of subsidies for enterprises, particularly export subsidies through incentive policies to attract investment to industrial parks (IPs) and export processing zones (EPZs) Immediately after Vietnam officially announces its entry to the WTO, the country will have to abolish many kinds of subsidies such as export bonuses, preferential interest rate policies, debt clearance and a series of incentive policies to call for foreign investment in industrial and export processing zones within five years from Vietnam’s admission to the organisation. According to the Ministry of Planning and Investment, by the end of the first quarter of 2006, Vietnam had 130 open economic zones, IPs and EPZs. In 2004, 31 provinces removed legal barriers by implementing incentive policies comprising lower business income tax and land tax rates than the common incentive tax rates set by the State in a bid to call for more investment from enterprises. The State has asked for early removal of these policies while the US has also demanded that Vietnam abolish its incentive policies and tax preferences for enterprises operating in the 130 IPs and EPZs. Economic experts said that this will pose huge challenges for businesses operating in the 130 IPs and EPZs as there will no longer be State subsidies for enterprises to help them dominate export markets and run joint-ventures with foreign partners to produce products on a large scale. Deputy head of the Foreign Investment…... [read more]

In recent times, agricultural land in rural areas has been cut away for the building of industrial parks and complexes. Many young people have left the countryside for big cities in the hope of earning a crust wherever they can. Only a small number of them have been recruited to work abroad under labour contracts while most of them are still jobless. Judging from past experience in some localities, the development of crafts and services through small- and medium-sized enterprises (SMEs) would help generate jobs for people living in the countryside. According to the Ministry of Agriculture and Rural Development, the number of enterprises established in rural areas has kept increasing since the Enterprise Law was enacted in 2000. In 2001, there were 3,600 enterprises operating in agro-fishery-forestry sectors, and the figure has now amounted to 16,000, excluding nearly 8,600 cooperatives. The figure is said to be incomplete as it excludes millions of households involved in non-agricultural production and services and especially large farms. These enterprises are taking on between 25-26 percent of the non-agricultural labour force and the figure is expected to keep rising significantly in the coming years. According to economists, to generate a job, it costs private enterprises VND35 million, limited companies VND45 million and State-owned enterprises (SOE) up to VND87.5 million. Investment capital is utilised in SMEs more effectively than in SOEs. To generate VND1 in revenue, SOEs have to invest VND562 million in their registered capital while private enterprises and limited companies need only VND197…... [read more]

Every year, Vietnam and Japan organise high-level exchange visits. In 2002, leaders of the two countries agreed to build Vietnam-Japan relations under the motto “reliable partnership and long-term sustainability”. During the visit to Vietnam in July 2004 by the Japanese Minister of Foreign Affairs, the two countries signed a joint declaration working towards a new level of sustainable relationship. In October 2006, Prime Minister Nguyen Tan Dung paid an official visit to Japan, beginning a new period of development under the motto “Towards strategic partnership for peace and prosperity in Asia”. Japan has supported Vietnam’s renewal and open policies and assisted Vietnam in its efforts to join regional and international organizations, including the Asia-Pacific Economic Cooperation (APEC), the World Trade Organisation (WTO), the Asia-Europe Meeting (ASEM), and the Asia Regional Forum (ARF), and lobbied the Organisation of Economic Cooperation and Development (OECD) to provide technical assistance to Vietnam. Vietnam supports Japan as a non-permanent member of the United Nations Security Council, while Japan is supporting Vietnam as a non-permanent member of the organization in the 2008-09 term. Japan is considered as Vietnam’s leading economic partner. The two countries have agreed to conduct formal negotiations on a bilateral Economic Partnership Agreement (EPA) from January 2007. Since 1999, Vietnam and Japan have given each other tax incentives. In the first seven months of 2006, total Vietnam-Japan trade turnover hit a new high of US$5.57 billion, an increase of 16.8 percent against the same period last year. Of the figure, Vietnam’s exports to…... [read more]

Vietnam is among the world’s 150 coastal countries. It has a 3,260 km long coastline, nearly 3,000 islands and two large archipelagoes. Its exclusive economic zone covers more than 1 million square kilometers. Vietnam has the world’s highest ratio of coastline and mainland. And in the 21st century, the countries with or without sea and island areas are exerting every effort to tap full potential of the sea. Marine energy resources include not only oil and gas but also a supply of clean energy resources from water and wind which may help overcome the exhaustion of traditional energy resources. In the past, the sea provided people with fuel resources and other essential things. At present and in the future, the sea may offer more than what it previously gave. For a long time, the sea and island areas have held a strategic position in national construction and development. In recent years, the marine-based economy has greatly contributed to boosting the growth of the national economy. In 2006, the oil and gas sector’s revenue accounted for more than one quarter of the country’s total budget collection and the seafood sector earned over US$3 billion from exports. However, benefits from the sea and island areas have not yet matched their potential and requirements for national development. Despite the EastSea possessing a large sea and island area, Vietnam has not yet worked out a master plan to exploit and protect national natural resources in a comprehensive and effective way. Even though Vietnam has…... [read more]

Many believe that Vietnam’s abundant source of labour will be an advantage to compete with China in attracting foreign investors. Professor Ho Duc Hung says at a round-table discussion on Vietnam’s human resources in the post-WTO period that cheap labour should not be considered an advantage, but rather a big concern for the economy. It is true that an abundant supply of low-cost labourers is an important factor in attracting foreign investors. However, cheap labour also means low quality to fit in with the growing trend towards modern production and management. Prof Ho Duc Hung says the labour productivity of a Japanese worker is 135 times higher than a Vietnamese, 30 times higher than a Thai, 20 times higher than a Malaysian and 10 times higher than an Indonesian. It is quite wrong to consider low-cost labour or low-quality labour as an advantage as low labour productivity in an enterprise will only lead to low profits. Experts say that enterprises may save money by hiring cheap labour, but, in fact, they have to pay more for training. Training fees for labourers in Vietnam are often 15-20 times higher than in other countries. Therefore, cheap labour should not be considered a positive advantage. Some people may be concerned by the fact that the total salaries of 20 Japanese experts at Nghi Son Cement Factory in northern Thanh Hoa province are equal to the salaries of nearly 2,000 Vietnamese labourers. The imbalance is not difficult to understand, as people who can earn…... [read more]

The information was shared by representatives of businesses, localities, scientists and policy makers at a recent workshop in Hanoi to discuss measures to keep the industrial sector from lagging behind. The Ministry of Industry reported that all provinces have industrial parks, but they have not developed as efficiently as expected. Many provinces have offered similar preferential policies on tax and land rental without considering their localities’ advantages. Dr Nguyen Thanh Thinh from the National Institute for Science, Technology, Strategy and Policy Studies suggested that Vietnam have an overall master plan detailing the combined development between sectors, localities and regions. The fact is that despite intensive investment, the sugar and sugarcane sector does not have adequate materials for stable production. Similarly, the seafood sector is suffering from a serious lack of materials for production. In contrast, the coffee sector has adequate materials, but lacks modern processing assemble lines. Consequently, the coffee sector mostly exports raw products of low value and its trademark is little known worldwide. Meanwhile, due to improper material growing development policies, the garment sector, which is considered a key hard currency earner, mostly relies on imported materials and executes manufacturing contracts for foreign clients with low added value. Economic researcher Tran Dinh Thien, deputy director of the Vietnam Economics Institute, said it is imperative to take into account key industrial sectors in which the State keeps the larger share. “Many countries in the world do not pay attention to developing the metallurgy industry which is considered the cornerstone…... [read more]

The visits also opened up opportunities and prospects for stronger cooperation between Vietnamese businesses and their counterparts from these countries. Many talks and exchanges were held between Mr Dung and the leaders of the five ASEAN countries, who praised Vietnam’s increased role and position in the region, its rapid and sustainable economic development as well as its open external policy. Brunei Sultan Haji Hassanal Bolkiah said that all the remaining nine ASEAN member countries have benefited from relations with Vietnam. He praised Vietnam’s achievements in national construction and development and its contributions to regional development. He also expressed his belief that Brunei and Vietnam will be “hand in hand” striving for the common interests of the whole region, prosperity of the two countries and happiness of all families. As a result, Mr Dung’s visit helped define and expand key cooperation areas between Vietnam and each of the five countries. Accordingly, Vietnam will strengthen cooperation in trade, investment and education with Singapore, oil and gas, labour and rice exports with Brunei, energy and telecommunications with Myanmar, and culture, agro-forestry and fisheries and anti-corruption with Indonesia. Vietnam signed a programme of action for the 2007-2010 period with the Philippines, detailing bilateral cooperation in security, national defence, economics, trade, forestry-fisheries, tourism, healthcare, culture, education and science and technology. During the tour, Vietnamese ministries, sectors and businesses signed a number of trade and investment agreements and business contracts with their counterparts valued at billions of US dollars. Notably, SP Chemical Group will invest billions…... [read more]