Monday, June 30, 2008

SK Energy secures 20 pct stake in Vietnam oil field

Mon Jun 30, 2008 2:41am BST

SEOUL, June 30 (Reuters) - South Korea's SK Energy (096770.KS: Quote, Profile, Research) said on Monday it had secured a 20 percent stake in an oil field in Vietnam currently under exploration.

"We secured the stake in late May, but since the oil field is in the very initial stages of exploration, we don't have any details on estimated or proven reserves," said SK Energy's spokeswoman.

Shares of SK Energy rose 1.75 percent, trading at 116,500 won as of 0131 GMT, outperforming the wider market's 0.36 percent loss.

Australia's Santos Ltd (STO.AX: Quote, Profile, Research) owns the majority 50 percent stake in the 123 oil field on the east coast of Vietnam, and the remaining 30 percent is owned by state-run Petrovietnam, SK Energy said.

SK Energy is the country's top refiner with a capacity of running 1.115 million barrels per day (bpd) of crude. (Reporting by Angela Moon; Editing by Jonathan Hopfner)

Vietnam Scraps $1 Bil. Contract With POSCO

By Kim Yoo-chul

Staff Reporter

The State-owned Vietnam Shipbuilding Industry Corporation (Vinashin) has decided to scrap plans to invest $1 billion in a $5 billion steel mill joint venture with South Korea's POSCO, as part of the government efforts to curb rising inflation.

The planned POSCO-Vinashin Steel Complex, located on a 970 hectares area of land in the central province of Khanh Hoa's Van Phong Bay, formed part of the Asian steel giant's ambitious goal to link a `steel belt'' from its home-turf, India, China and Vietman.

Vinashin Chairman Pham Thanh Binh said it would also postpone or suspend some 40 other projects worth a total investment of $395 million.

``We will go ahead with that plan regardless of the withdrawal from the Vietnamese government. We are abundant in cash,'' POSCO spokesman Kim Dong-wan said.

In April, POSCO said it will start construction of the plant in April 2009 though concerns were running high over environmental issues as the area is one of Vietnam's most beautiful bays.

``The decision by Vinashin either to quit or extend the implementation of 49 projects, is likely to hit us as POSCO is on a expansionary track in the highly-promising country,'' Kim added.

Vinashin maintains constructive relationships with local shipbuilders. Hyundai Mipo owns 55 percent of Hyundai-Vinashin shipyard, while Hyundai Heavy Industries constitutes some 10 percent of the joint venture. STX Shipbuilding, a smaller local shipbuilder, is known to view a possible joint investment with one of the State-owned companies.

``In the case of POSCO, no drawbacks are seen for POSCO to push the project on its own considering its internal cash reserves,'' said Kim Kyoung-jung, an analyst at Samsung Securities.

The Vietnamese government, grappling with seven straight months of double-digit inflation and a tripling trade deficit that has hit investor confidence in the economy, ordered state-run businesses to change their business plans.

Economists and analysts say state-backed Vietnam companies need to focus on their specialty rather than expansion into various sectors.

Credit growth was 54 percent last year and record amounts of foreign direct investment poured into the Southeast Asian country.

Vietnam dong falls to new multi-year low versus dollar

6/27/2008 1:52 AM ET
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(RTTNews) - The Vietnam dong fell to a new multi-year low of 1.6843 against the US dollar during early deals on Friday. The dollar-dong pair closed Thursday's deals at 1.6615.

Yesterday, the Vietnam central bank announced that it is widening the Dong's trading band to 2% from 1%, with effect from Friday. The pair is allowed to rise or fall 2% against the dollar.

The move was largely done to tame the country's inflation that has struck almost 27% in June. But the Dong's deprecation will add more fuel to the fire as the weaker currency increase the cost of imports.

Vietnam Prime Minister Nguyen Tan Dung pledged that the inflation will be brought to one digit figure in 2009 and in early 2010. Consumer prices in June rose 26.8% on a year-on-year basis from 25.2% in May.

On June 11, the central government has weakened the Dong's trading band by 2% and raised the base interest rate to 14 percent from 12 percent to fight double-digit inflation.

The Vietnam currency that surged to new multi-year high of 1.5820 against the dollar on March 24 started weakening thereafter. Since then, the Vietnamese dong has depreciated around 6% against the dollar. Accelerating inflation, a widening trade deficit and a near 60 percent slide in local stocks this year have seen the currency decline for three straight months.

by RTT Staff Writer

For comments and feedback: contact

ADB lends Vietnam $195m for hydroelectric plant

The Asian Development Bank (ADB) will provide a US$196 million loan to Vietnam for a hydroelectric project in Quang Nam Province, the Manila-based lender said Friday.

The 156-megawatt Song Bung 4 hydropower project will be built on the Song Bung River in the central Vietnamese province and is expected to be completed by 2013, the ADB said in a statement.

“Vietnam has an acute need formore power generation,” statement said.

“Electricity demand has grown at an average rate of 15 percent per annum and it is expected to maintain a high growth rate until 2015.

“Affordable and reliable electricity is essential to Vietnam’s continued economic growth and poverty reduction efforts,” said ADB Energy Specialist Pradeep Perera.

“This project will improve the stability and reliability of the country’s power network, and will further reduce its dependency on fossil fuels,” he said.

The project will require the relocation of four villages with 206 households, all from the Co Tu ethnic minority group.

The households are all living below the poverty line.

The ADB said the relocated people will be provided with new homes as well as clean water, schools and medical facilities.

(Source: AFP)

Vietnam commits to better investment environment: President

07:08' 29/06/2008 (GMT+7)

President Nguyen Minh Triet
VietNamNet Bridge - Vietnam is speeding up international economic integration and creating favourable conditions for foreign investors, including those from the US, said President Nguyen Minh Triet.

Receiving General Electric (GE) Vice Chairman John G. Rice in Hanoi on June 27, President Triet congratulated the US firm on its licence to build an electric generator and component factory in the northern port city of Hai Phong .

The State leader applauded GE’s plan to expand investment in Vietnam and thanked the company for its organisation of a training course for Vietnamese managers, believing that cooperation between GE and local partners will be of success.

He took this occasion to express gratitude to GE for its contributions to the nation’s development and called on the group to continue to cooperate with and encourage other US corporations and companies to invest in Vietnam .

In reply, John Rice pledged GE’s long-term investment in Vietnam and revealed that the company and its Vietnamese partners recently discussed a possibility of cooperation in aircraft engine repair and water filtering technology.

The executive told his host that GE also desired to engage in the fields of finance and banking in Vietnam

Miss Universe pageant will be held in Vietnam

(L-R) Miss Kazakhstan Alfina Nassyrova, Miss Russia Vera Krasova, Miss Turkey Sinem Sulun, Miss Ghana Yvette Nsiah, Miss Tanzania Amanda Ole Sulul, Miss Philippines Jennifer Barrientos and  Miss Ukraine Eleonora Masalab pose for a photo on a boat while traveling Halong Bay, in northern Vietnam June 28, 2008. The 57th annual Miss Universe pageant will be held in Vietnam's central Nha Trang resort city on July 14, 2008.

(L-R) Miss Kazakhstan Alfina Nassyrova, Miss Russia Vera Krasova, Miss Turkey Sinem Sulun, Miss Ghana Yvette Nsiah, Miss Tanzania Amanda Ole Sulul, Miss Philippines Jennifer Barrientos and Miss Ukraine Eleonora Masalab pose for a photo on a boat while traveling Halong Bay, in northern Vietnam June 28, 2008. The 57th annual Miss Universe pageant will be held in Vietnam's central Nha Trang resort city on July 14, 2008.(Xinhua/Reuters Photo)
Photo Gallery>>>

Friday, June 27, 2008

Vietnam Suspends Gold Imports

Inflation is soaring in Vietnam. The cure is simple. All Vietnam has to do is stop the expansion of money and credit. Vietnam is instead looking at trade deficits and gold.

Voice of America is reporting Inflation, Trade Deficit Cause Worry in Vietnam.

Just a few months ago, Vietnam was touted as the new China, with its fast-growing economy drawing billions of dollars in foreign investment. But then came an inflation problem that seems to have gotten out of control. Now the government is wrestling with a slew of problems that threaten to knock the country's economic success off the rails. Matt Steinglass reports from Hanoi.

Vietnam's trade deficit shot up to $14 billion in the first five months of 2008, from $11 billion for all of last year. The influx of foreign currency puts pressure on the Vietnamese dong to strengthen.

But that would make Vietnamese exports more expensive, hurting local industries. So the government held down the exchange rate by buying dollars with dong, which inflated the supply of dong, contributing to inflation.

My Comment: This is exactly what China is doing as well. Bernanke calls this a "savings glut". Printing "Yuan" to buy dollars is no more savings than printing "đồng" to buy dollars. I discussed this many times, most recently in Bernanke Blames Saving Glut For Housing Bubble.

Peter Ryder, head of the investment group Indochina Capital, says that reassured investors, but perhaps not enough.

"The big, big issue in my mind is, are they going to be able to get away with just gradually devaluing the currency, is that the best thing to do? Or should they just kind of go 'whack'? Just do [devalue by] 20 percent at one time? Or are they just going to kind of let the air out of the tire [slowly devalue the currency]?"

Analysts at the investment banks Merrill Lynch, Deutsche Bank, and Morgan Stanley have warned that unless the government raises interest rates, devalues the dong, shuts down insolvent banks, and cuts government spending, it could face a currency crisis.

My comment: Vietnam is attempting to grow its export business. It "succeeded", using the term loosely. Now it is facing the consequences. The list of recommendations is ironic. The US needs to do the same, most notably shutting down insolvent banks and cutting government spending.

Vietnam Suspends Gold Imports

Rather than do what needs to be done, politicians instead always try something 100% guaranteed not to work, such as this: Vietnam suspends gold imports in move to ease growing trade deficit.

Vietnam's communist authorities have temporarily suspended all gold imports in a bid to tackle the country's spiralling trade deficit and help support the depreciating local currency, the dong.

With Vietnamese investors rushing into gold as a hedge against skyrocketing inflation, Hanoi - which sets an annual quota for gold imports - has withdrawn licences for further imports, traders said yesterday.

The decision comes as record imports of gold bars have made Vietnam the world's biggest market for gold bullion, surpassing India and China and helping to deepen Vietnam's trade deficit.

"We've seen high demand as Vietnamese investors have taken a rational decision that this is a hedge against higher inflation, and a weak dollar," said John Shrimpton, a director at Dragon Capital, a Ho Chi Minh City-based boutique investment bank.

Hedge against a weak Dollar or a weak đồng?

If a devaluation is coming, the last thing one would want to hold is the đồng. In the final analysis, the đồng, the yuan (renminbi), the dollar, and even the Euro are all dung. The only difference is the speed at which that realization will come. It is perfectly rational for demand for gold to rise in Vietnam. Banning imports will do nothing to solve the underlying problem.

Mike "Mish" Shedlock

Thursday, June 26, 2008

Offshore Resolute gets one full year with Vietnam's Thang Long

Scorpion jackup Offshore Resolute - courtesy KFELS

VUNG TAU, VIETNAM: Thang Long Joint Operating Co. extended the rig charter for Scorpion Offshore jackup Offshore Resolute by 161 days for a firm contract period of one year.

The rig was previously chartered to Thang Long at US$52 million for a firm duration of seven months. The extended charter will be subject to the same dayrate as well as terms and conditions.

The jackup is being mobilised from Brownsville, Texas, to its first location offshore Vietnam where it is expected to arrive on July 22. Drilling is expected to start in early August.

Offshore Resolute was delivered to Scorpion Offshore by Keppel AmFELS on April 25.

Filed from Singapore 6/25/2008 6:59:24 AM GMT

Alcoa looking into deal with Vietnam refinery

By The Associated Press

Wednesday, June 25, 2008

Aluminum producer Alcoa Inc. announced Tuesday that it will look into buying a stake in a refinery project with a state-owned minerals development company in Vietnam.

Under an agreement with Vietnam National Coal-Mineral Industries Group, an Alcoa subsidiary will conduct due diligence on buying a 40 percent stake in the proposed Nhan Co. alumina refinery. The facility, to be built in Dak Nong Province, would produce 600,000 metric tons per year of alumina, a material made from bauxite and used to make aluminum.

If the transaction goes ahead, Alcoa World Alumina and Chemicals will own 40 percent, the Vietnamese company 51 percent and other investors 9 percent of the Nhan Co. refinery and bauxite mine.

Pittsburgh-based Alcoa has a 60 percent stake in Alcoa World Alumina and Chemicals.

Wednesday, June 25, 2008

Vietnam's News Brief

VNPT signs contract with ITA

HCM CITY — The Viet Nam Post and Telecommunications Corp. (VNPT) concluded a contract last Saturday with ITA Telecom for strategic co-operation in investment and service supply.

The contract will link VNPT, which runs a leading telecommunication infrastructure system in Viet Nam, and the ITA-Group, developer of several industrial parks, including Tan Tao in HCM City and Tan Duc in Long An Province.

ITA, which also has other urban area and office building projects, is the parent of ITA Telecom.

"We’ll jointly invest in systems and provide telecommunications and IT
services in urban areas, industrial parks, export processing zones, hi-tech
parks and smart buildings," said
Nguyen Ba Thuoc, deputy general director of VNPT.

Taiwan plastics firm boosts capital

Dong Nai — Hung Nghiep Formosa Joint Stock company, a wholly Taiwan-invested enterprise, has increased its capital from US$956 million to $1.11 billion.

The company is building three factory specialising in producing polyster long fibre, PVC plastic and plastic fibre.

Another project on waste water processing will soon come into operation.
It will have a capacity of 5000 cu.m a day.

The Formosa group covers many sectors, including weaving, synthetic fibre and plastic factories.

Saigontourist accepts official rate

HCM City — Saigontourist said its Vietnamese tourists can pay for tickets priced in US dollar at the listed
foreign-exchange instead of at the blackmarket rate.

Doan Thanh Tra, manager of the company’s marketing department, said this would ensure customers’ rights as the free-market fluctuated.

Saigontourist has been recognised as one of the best travel firms in Viet Nam. Last year, it had a turnover of more than VND674 billion ($40.8 million).

Rong to get oil storage facility

HA NOI — Viet Nam’s biggest floating oil storage facility will be installed in Rong Oilfield, about 200 miles off the southern Vietnamese coast.

The 150,000 tonne storage, built for Petroleum Technical Services Corporation (PTSC), an affiliate of the Viet Nam Oil and Gas Group, is 258m long, 46.4 m wide and 24m high.

The Nam Trieu Shipbuilding Industry Corporation said the storage is to receive oil through the undersea pipeline and treat crude oil before being exported.

Paradise park to open September

HA TAY — Bao Son Paradise, worth US$100 million, will open its door in September, making its the first international-standard tourism and entertainment park in north Viet Nam.

Financed by the Bao Son Group, the park covers 20ha in the northern Ha Tay province’s An Khanh new urban area, including an eco-tourism resort, entertainment areas and villas.

The park is expected to attract 10,000 international and domestic visitors per day as operational.

VN still attractive to investors

HA NOI — About 70 foreign enterprises
from the Chinese mainland, Hong Kong, Taiwan and Macao recently visited
Viet Nam to check investment opportunities.

Their two-day visit by the Chinese business people was supported by HSBC Viet Nam. The group included representatives from real estate, garment and textiles and construction.

To foreign investors, Viet Nam is still an attractive market with many advantages, said HSBC’s general director, Thomas Tobin.

Deutsche Bank raises stake in Vinamilk

HA NOI — Deutsche Bank has bought 221,580 more shares in the Viet Nam Dairy Product Company (Vinamilk), raising its stake in the company to 6 per cent of Vinamilk’s charter capital.The German bank now owns 10.51 million Vinamilk shares.

In the first five months of this year, Vinamilk made VND617 billion (US$37.4 million) in pre-tax profits, a year-on-year increase of 28.27 per cent.

GE Money Viet Nam to operate in domestic market

HA NOI — The State Bank of Viet Nam has granted a licence to GE Money Viet Nam to start operating in domestic markets.

The company can now issue promissory notes, bonds and other valuable papers, as well as receive trustee capital from local and overseas organisations.

GE will also offer credit cards and loans, and act as a consultant on asset management, banking and other financial matters.GE Money Viet Nam, located in HCM City’s Saigon Centre, has a charter capital of VND300 billion (US$18.2 million).

Japanese brokerage sets up shop in Viet Nam

HA NOI — The Japanese Daiwa Securities SMBC Company opened up a representative office in Ha Noi yesterday.

The office will link the local stock exchange with overseas investment organisations, and assist domestic companies with floatation on the stock markets and in raising money in overseas markets.

Daiwa SMBC’s parent company is a joint venture between Japan-based Daiwa Securities and the Sumitomo Mitsui Financial Group.

Coc Sau Coal JSC to list 10 million shares in HN

HA NOI — The Coc Sau Coal Joint Stock Company will list 10 million shares on the Ha Noi Securities Trading Centre on June 26.

The shares, coded TC6, will be offered at a face value of VND10,000 (US$0.6) each.

The company, whose charter capital is currently VND100 billion ($6.25 million) specialises in the exploitation and procession of minerals, industrial and civil construction, transport and services. The State has 51 per cent stake in the company.

Hacinco JSC pays second quarter dividends

HA NOI — HACINCO Joint Stock Company officially announced the company’s decision to pay 6 per cent of dividends to its stakeholders.

The payment is for its earnings in the second quarter of this year. It will be implemented on July 22nd. Viet Nam Securities Depository Centre will suspend the depository of TC6 on June 26, 27th and July 1st.

Bien Hoa Sugar to issue 1.7 million more shares. — VNS

400,000 Americans visit Vietnam in 2007

Lively links between Vietnam and the US
07:04' 24/06/2008 (GMT+7)

US visitors in HCM City.

Busy East-West trips

Last year more than 400,000 Americans visited Vietnam, a rise of nearly 6 percent from 2006 and doubling the number in 2000. But the arrivals represent less than 10 percent of the total foreign visitors to Vietnam in 2007 and also a fraction when compared with about 60 million American tourists going on overseas trips each year.

"As Americans continue to travel, the United States, with its development capacity and potential, will remain a significant source of investment capacity, which Vietnam needs to tap into," said Hoang Tuan Anh, former Head of the Vietnam National Administration of Tourism and now Minister of Culture and Communications.

But the economic slowdown in the United States so far this year has prompted many to tighten their pocket and keep more at home. Figures published by the General Statistics Office showed 133,000 Americans came to Vietnam in the first quarter of 2008, 7.9 percent higher than the same period last year but which is slowing from a growth of 12 percent in the first quarter of 2007 from a year earlier period.

Tourism industry officials believe the decline in U.S. tourist arrivals would be short-lived. They say a long coast line, friendly people and an economic and political stability in Vietnam remain stimulus to attract foreign tourists.

In tour business, the BTA allowed U.S. companies to establish joint ventures with Vietnamese partners with no limitation on the foreign ownership and do business with hotels and travel agents.

Vietnam's tourism has projected to target the United States as a major supplier of tourists under its 2001-2010 plan but apart from obstacles rising from political relations and the geographical distance, the country's tourism sector faces shortages of experience and budget to fund promotional activities in the U.S. market.

Foreign investment in hotels, resorts and leisure projects are still modest, or around 10 percent of the total foreign investment in Vietnam worth $104 billion.

Several major projects have been licensed in the first quarter of 2008, especially in HCMC, Da Nang, Quang Nam Province, Hue and in the central provinces of Khanh Hoa and Binh Thuan.

Most of these locations have historical attraction as they are all more or less related to sites of the past conflict which is an attraction since a large number of U.S. tourists coming to Vietnam are veterans, their relatives or simply those who are interested in learning about the war.

In January 2008 California-based Good Choice received an investment licence to invest $1.3 billion in a Disneyland-style theme park in the southern coastal town of Vung Tau.

The affiliate of leading U.S. real estate and investment firm Platinum Dragon Empire Incorporated (PDE) would build a 80-storey tower and a "Wonders of the World" site in the complex.

Other U.S. investors also eyed on Vietnam's developing tourism industry, such as Winvest Investment LLC which is working on a $300 million, hotel and casino complex in Ba Ria-Vung Tau Province.

In regard to outbound tours, several domestic tourist companies have started offering trips to the United States.

Saigontourist Holding Company, a major tour operator established since 1975 as the first company dealing with tourism in Ho Chi Minh City, has been dealing with travel agencies of 36 countries worldwide including the United States.

Similarly Vietravel and Hoan My Tour Co also run tours to New York, Washington DC, Las Vegas and Los Angeles.

Vietnam Airlines, the national flag carrier, said it has projected to open its direct air service between Vietnam and the United States in late 2008.

It has already been operating code-share flights with China Airlines and American Airlines to take passengers to 12 cities, including Los Angeles, San Francisco, New York, Chicago and Washington.

Cultural platform

In September, 2003 Raymond F. Burghardt, U.S. Ambassador to Vietnam, said the success in the two countries' relation should not only be limited in commercial progress.

In the field of culture exchange, music performance, fine arts, literature and exhibitions have all been used to help convey ideas and cultural values.

The United States has demonstrated its respect for Vietnam's culture by financing restoration at several pagodas such as the Dau Pagoda in Bac Ninh Province and the preservation of music of the Tay people in the northeastern region.

In late May 2008, the Museum of Vietnamese History in Ho Chi Minh City put on display 18 restored Buddha statues originally sculpted by Vietnamese artists in the 17th and 19th centuries.

The project involving Vietnamese craft-men repainting the statue and applied a gild on them received more than $27,000 from the U.S. Ambassador's Fund for Cultural Preservation which helps countries worldwide preserve disappearing cultural traditions.

The fund has also extended grants to restore artifacts and other items from the Cham exhibits at the Cham Museum in the central city of Da Nang.

U.S. Ambassador Michael Michalak said the grants have been in place since Buddhism plays an important role in Vietnamese life and the joint effort represents good will between the two countries.

The State Department has also funded America singers and jazz groups who have held master classes and given performances throughout Vietnam. Other U.S. fundings have also gone to an exchange of dancers and art managers organised by the dance theatre workshop of New York.

The American Museum of Natural History and Vietnam's Museum of Ethnology opened in March 2003 the exhibition "Vietnam: A Journey of Body, Mind, and Spirit" in New York and the footage of the exhibition was aired on Vietnam Television.

Besides, the U.S. Government supports the Asia Foundation in its work stocking the libraries of Vietnam with useful works. They organised U.S. visit for American Studies professors from Vietnam and conferences on American Studies in Vietnam.

In May 2007 a U.S. Film Week was held in Hanoi and HCMC.

In June 2007 Vietnam sent a delegation of 39 folk artists and artisans to participate in the Smithsonian Folklife Festival in the United States.

In recent months American singers toured Vietnam and gave public performances in many cities across the country.

Sister cities

In September 1950 U.S. President Dwight D. Eisenhower initiated the sister city programme as he proposed a people-to-people, citizen diplomacy initiative during a White House Summit on Citizen Diplomacy.

The president's hope was that personal relationships, fostered through sister city, county, and state affiliations, would lessen the chance of future world conflicts.

Since then Sister Cities International the international membership association headquartered in Washington, DC represents over 2,500 communities in 126 countries around the world.

Five pairs have been established between Vietnamese and U.S. cities so far, namely Hai Phong - Seattle, Ho Chi Minh City - San Francisco, Hue - New Haven, Da Nang - Oakland and Vung Tau - Newport Beach.

In 1994 New Heaven became the first U.S. city to enter the Sister City partnership with Vietnam's central city of Hue. The Sister City Project members went to Vietnam to help deliver medical supplies and computers to institutions with which the project has ties, among the clinics and schools.

Seattle said its work with Hai Phong focused on four areas: improving access to public health services, developing a plan to attract tourism, building a web site, and helping with urban planning.

On December 10, 2004 the first United Airlines flight left San Francisco and landed in Ho Chi Minh City for the first time since the war ended, opening opportunities for increased trade, investment and tourism between the two sister cities as well as the two nations.

In May 2005 a delegation from the Bay Area visited Hanoi to celebrate the "10th Anniversary" of the normalisation of relations between the United States and Vietnam.

The group was formed by members of the San Francisco - HCMC Sister City Committee and others who joined to celebrate "San Francisco Week" in Ho Chi Minh City.

San Francisco Mayor Gavin Newsom said that the "activities of the visit are focused on recognizing the important role the Sister City relationship has played in improving the relations between the countries over the past ten years and also strengthening and deepening the friendship between our two great cities."

(Source: VN-US Society & Vietnam-US Magazine)

Vietnamese trio charged with gold smuggling to Russia

Trio face charges for gold smuggling attempt
Police are pressing charges against three people who allegedly attempted to smuggle around 1.5 kilograms of gold to Russia two years ago.

The trio, Nguyen Xuan Hao, Dang To Hai, and Le Trung Hieu, are being charged with “smuggling goods and currencies,” police announced Monday.

Nguyen Xuan Hao was caught red-handed at HCMC’s Tan Son Nhat Airport in October 2006 carrying some 1.5 kilograms of gold jewelry hidden in a pilot’s headphones.

He was about to board flight VN527 to Russia.

Hao was an employee of Vietnam Airlines’ A75 Airplane Enterprise which specializes in repairing and maintaining the carrier’s aircrafts.

In order to board the plane without being detected with the gold, Hao used his staff card to cross the tarmac as if he was working, though he was not on shift at the time, the police said.

During questioning, Hao said the owner of the contraband was Dang To Hai from the southern province of Ba Ria-Vung Tau.

Hai had allegedly hired Hao and Le Trung Hieu, another airport employee, to smuggle the gold to Russia for his associate.

Vietnam's Dung Quat economic zone to quadruple in size


Dung Quat Oil Refinery in Dung Quat Economic Zone in the central province of Quang Ngai. Plans are underway to quadruple the size of the EZ to 50,000ha. — VNA/VNS Photo Thanh Long

Quang Ngai — Plans are underway to more than quadruple the size of the Dung Quat Economic Zone, in Quang Ngai Province, to 50,000ha.

Tran Le Trung, head of the zone’s management board, said increasing demand, particularly from heavy industry, had prompted Quang Ngai provincial authorities to expand the 10,300ha zone by 39,700ha – 10,000ha of which will take in Ly Son Island.

When completed, the zone will extend to within 40km of Chu Lai Airport and border Quang Ngai City and My Khe beach.

"The management board has set itself the target of attracting $12 billion in investment capital by 2010, of which about half would have been implemented." Trung said.

By 2010, the management board estimates industrial output will be over VND10 trillion ($602 million), of which the export value will be about $200 million.

If everything goes to plan, the zone will contribute to the provincial budget between VND8 trillion to VND10 trillion. As a result, per capita annual income in the province would increase to $1,000, Trung said.

By 2020, it is estimated that the total investment capital would have doubled and that industrial production would be around $30 billion – of which the export turnover would be $15-20 billion.

Investment projects

Up to the beginning of this month, Trung said the zone had attracted 161 projects with a total registered capital of over $10 billion.

So far, 74 per cent of the zone’s west side (491ha out of 665ha) and 76 per cent of the available land on the east side (1,276ha out of 1,668ha) has been occupied, Trung said.

Most of the projects on the east side are large scale, including the Dung Quat oil refinery, which occupies a 316ha site. The refinery is expected to be operational next year. Also on the east is a ship-building yard occupying 250ha, the Doosan factory (114ha) and a series of petrochemical and heavy machinery manufacturing plants.

Trung said many Vietnamese and foreign investors from South Korea, Japan, India, Taiwan, among others, had expressed interest in the zone, which opened in April 1996.

"Good technical and social infrastructure is the key reason for them to come to the Dung Quat economic zone," Trung said.

The zone also has a deep sea water port and good infrastructure – roads, public utilities, as well as telecommunications and health services.

Second deep sea port

Meanwhile, a team from the Viet Nam Institute of Science and Technology led by Truong Dinh Hien has conducted extensive research into the building of a second deep sea port – the My Han port.

According to Hien, the port, which will be twice the size of the Dung Quat port, will meet the growing needs of the enlarged Dung Quat economic zone.

With a natural water depth of 24 metres, the port will be able to receive ships up to 260,000 DWT (dead weight tonnage).

Under the plan, My Han port will be divided into two areas: north and south.

The north will be for large-scale projects, while the south will be for general services.

The port will have a total area of about 1,000ha and a length of 16,700 metres (three times longer than Dung Quat). Warehouses are expected to occupy about 600ha.

"To protect the port from the rough sea, scientists calculate that 7,000 metres of sea-dykes will have to be built at a cost of about $280 million," Hien said.

He added that the money would come from the state budget or from Government-private sector joint investment.

Up to 2015, development would focus mainly on meeting the needs of heavy industry. Construction of commodities’ infrastructure would begin after 2015, Trung said. — VNS

Is Vietnam's market a buy?

The beat goes on – one sector gets pumped up...and then it gets whacked.

Jim Cramer says he’s never seen anything like it...

Not the crash of Drexel Burnham Lambert in the ’80s...not the Asian currency crisis...not the LongTerm Capital Management blowup...not the dotcom bust...

Now, he says, the mood of gloom on Wall Street just gets worse and worse...with no sign of let up. Thousands of layoffs. Stocks in steady decline.

That makes us a little sad, here at The Daily Reckoning headquarters. We don’t like to kick an industry when it is down...and we like kicking Wall Street.

But you can see why the former Masters of the Universe are so blue – their bonuses are falling. So is the value of their stock options.

“Banks struggle to get capital,” begins an article in the Wall Street Journal .

When JP Morgan bought Bear Stearns, for example, everyone thought they had stolen the company. It was clearly the bottom – or so they believed. And they had a $30 billion guarantee from the feds. What could go wrong?

But the whole financial sector has continued to sink...and now J.P. Morgan’s deal is looking less sure.

(Even the best of companies – such as Warren Buffett’s Berkshire Hathaway – are getting beaten down. Berkshire traded at over $1,500 last December. Now, the share is down to $1,220.)

Yesterday, the Dow held steady. But last week was a bad one...with stocks losing 3.8% and the Dow falling below 12,000. Oil gained another $1.38, bringing the going rate for a barrel of crude to $136.

The dollar gained against the euro, and gold fell $16.

What is amazing about Cramer’s point of view is that he seems to be surprised. What did he think? That the bubble in the financial industry could expand forever? Or that the Fed could pump it up again, even after it sprung a major leak?

Sorry, Jim, it just doesn’t work that way.

The financial industry used to represent about 10% of the entire stock market’s earnings. Then, as credit grew, the financial sector invented new ways to separate people from their money. During the period known as the Great Moderation, the percentage of earnings coming from Wall Street rose to 40% of the total. Now it’s coming back down. It’s over.

We don’t have to tell you, but the ‘Great Moderation’ was a big fraud. There was nothing moderate about it. Instead, it was a period of extravagance...excess...over-the-top consumption and borrowing...and outlandish claptrap. It was claimed, for example, that the Wall Street firms were “adding value” by packaging subprime mortgages into securities and peddling them to towns in Norway. And it was believed that the Fed really had learned how to smooth out the business cycle and could henceforth avoid serious downturns. And inflation? That was a problem of the ’70s...not of the 21st century.

But every bubble pops. And the force of a correction is equal and opposite to the deception that preceded it. Naturally, the correction in the financial industry would have to be substantial. Nor is the Fed able to stop it. When a bubble bursts, the Feds can pump as hard as they want; the new cash and credit will go into a new bubble, not the old one.

You haven’t seen another bubble in the dotcom industry, have you? That one blew up eight years ago. It hasn’t come back – despite the best efforts of central banks all over the world. And don’t expect another bubble in housing either. We’ve seen the highest prices for housing – in real terms – that we will probably see in our lifetimes.

Bubbles...busts...bubbles...busts...the beat goes on. One sector gets pumped up...and then it gets whacked.

What’s up next? See below...

*** The next bubbles are probably coming in oil...commodities, and – many experts believe – in emerging markets.

We see the hot air flowing into the oil market, for example. Barron’s reports that $260 billion has gone into indexed commodity strategies – up from only $13 billion at the end of 2003.

And looking at a chart of the NASDAQ, 1990-2000, we find it looks familiar. Yes, dear reader, the oil market 1998-2008 looks a lot like the dotcom market (traded on the NASDAQ) eight years before.

Of course, many are the reasons why you might think oil will get more and more expensive. But so were the reasons that you might have expected the dotcoms to keep going up. And prices of Miami condos to keep going up. And tulip bulbs.

‘Oil is different,’ we can hear you saying. The economy can’t function without it. More and more people are buying it. The Nigerians are blowing up pipelines. Production has peaked out. T. Boone Pickens says it’s going up. The Chinese are hoarding for the Olympics, and so forth.

Maybe so. But human beings err, said Rosmini. The more reasons they have to believe something...the more they tend to believe it to excess. And the sadder they are when their beliefs are proven incorrect.

As to emerging markets, Alan Abelson, in Barron’s, believes they are in bubble-mode too. “Decoupling” is hooey, he believes. When the world economy heads down, they’ll go down with it.

But many emerging markets are already down – big time. Shanghai is off 50%. Vietnam even more. Are they bubbles that have burst...and can’t be reflated? Or are they still bubbles-to-be...waiting for the next gush of hot air?

Today’s paper tells us that Vietnam has done something extraordinary. It has banned gold imports in order to try to reduce its trade gap. Vietnam has an inflation rate of 25%. So, the Vietnamese try to protect themselves in the way people always have – by trading paper currency for gold. So great was this traffic that Vietnam became the world’s largest market for gold – bigger than China or India. And so great was pressure on the Vietnamese economy and its currency, that government officials moved decisively to make the situation worse – by banning gold imports.

Still, colleague Manraaj Singh, for example, thinks Vietnam is a buy:

Vietnam’s Ho Chi Minh City share index continues to be a leader this year. Once it led on the way up, this year it’s been leading global markets on the charge down. The index fell every on trading day in May and in early June as well. It’s now down by 60 per cent since the beginning of the year.

“...Which begs a simple question: are we stark raving bonkers to still be in love with Vietnam?

“At the end of May, inflation in the country hit 25 per cent – the highest level since 1993.

“And then there is the trade deficit. It is expected to be above $15 billion for the first five months of this year. That’s a considerable increase on the 2007 deficit of $12 billion.”

But the Bank of Vietnam is serious about fighting inflation, he says. It raised rates from 12% to 14% last week – still more than 10% below the level of CPI.

Manraaj continues:

“That was the second interest rate rise in just three weeks and makes the highest in Asia. Investors were looking for a sign that the government was serious about tackling inflation and they got one.

“Better yet, the government has indicated that it may raise rates even further in order to bring inflation down to single-digit figures by the end of next year.

“In Vietnam, food accounts for almost 43 per cent of the consumer price index. And the rise in food prices has been a global phenomenon. The global rise in rice prices this year has had a huge impact on Asian countries. In the Philippines, armed soldiers were required to guard the countries rice supplies.

“Even here in London, the Chinese restaurant across from our office has put a 30p ‘temporary surcharge’ on all its rice dishes. ...

“But Vietnam’s finance minister, Vu Van Ninh, says that the country now has sufficient supplies to avoid further price increases, while still exporting 4.5m tonnes of rice this year. So we should see a sharp drop in food inflation in Vietnam this year.

“Just look at the other great bugbear that has spooked international investors – Vietnam’s soaring trade deficit. It isn’t anywhere nearly as dire as it sounds either. Far from it...

Vietnam’s biggest import items are machinery and equipment (‘M&E’), construction materials and refined fuel. These are all items that are vital to the development of an emerging economy. Most of them still have to be imported, but that’s changing fast. A lot of these capital goods are being used to build-up domestic manufacturing capacity – factories and infrastructure. It won’t be long before it is able to locally produce a lot of what it now imports. Take steel, for example. Vietnam is a net importer of steel today, but it’s expected to have enough pr, but it will soon have sufficient production capacity to satisfy domestic consumption.

“There’s a world of difference between a country that has a trade deficit because it is importing equipment and material to build factories, power plants and roads, like Vietnam is doing; and one that has a deficit because it is addicted to imported Sony Playstations, iPods and cheap sneakers.

“Again, we’ve seen global markets reeling under the impact of surging energy prices. But what very few people realise is that Vietnam is actually self-sufficient in terms of crude oil production. What’s been missing is a domestic oil refinery. So the country has actually had to export 100 per cent of its crude oil and then re-import it as refined fuel. That’s been a major contributor to its trade deficit and it’s also been a major driver of inflation. But the country’s first oil refinery is going to come on-stream in 2009 – and that should have a massive impact on both inflation and trade deficit.

Vietnam’s government is obviously on a steep financial learning curve – remember that this is still a Communist country – but they’re learning fast. And, crucially, they’ve shown that they’ve got the will to act.”

Until tomorrow,

Bill Bonner
The Daily Reckoning

Tuesday, June 24, 2008

SCOMI Marine to tap Vietnam oil transport business

Firm, Partner to Tap Viet Oil Transport Business
New Straits Times

By Kamarul Yunus

SCOMI Marine Bhd, a marine logistics and offshore support services firm, is banking on its 20 per cent-owned joint-venture (JV) company to tap the transportation segment of the booming oil and gas industry in Vietnam.

Scomi Marine chief executive officer Shah Hakim Zain said the joint-venture company in Vietnam plans to own five clean petroleum product (CPP) vessels in the next three or four years.

"We are finalising terms with our partner to co-own our first CPP tanker, costing about US$55 million (RM179.3 million). We expect to conclude talks in a month or two," he said after Scomi Marine's annual general meeting in Kuala Lumpur yesterday.

Scomi Marine recently acquired a 20 per cent equity stake in Southern Petroleum Transportation Joint Venture Co (PV Trans Petro), which will be the main CPP transporter for the proposed refineries being constructed by PetroVietnam (PVN), the national oil company of Vietnam.

Shah Hakim said PVN is building three refineries, and the first, located in Dung Quat, is expected to be completed by 2009. PV Trans Petro is expected to carry 60 per cent of the refinery capacity.

"We are also in talks with PVN on the possibility of the joint- venture company to serve as product transporter for two other refineries," he said.

Shah Hakim said the group is positive on Vietnam as an oil and gas market.

"We have commenced several initiatives with the national oil company of Vietnam and their subsidiaries to look into owning vessels with them.

"We are at various stages of discussions with parties, from memorandum of understandings to finalising participation to co-own vessels.

"Vietnam is a very important and huge market for us. It has potential. In fact, bigger than Malaysia," he said.

Shah Hakim said he expects to see contribution from Scomi Marine's investment in Vietnam by next year, through equity participation.

"We may see revenue contribution from this joint venture this year but only a small portion. We will see more next year," he said.

Apart from the oil and gas sector, he said, the joint-venture company will also try to explore the transportation segment potential in other industries in Vietnam.

"But the current venture in Vietnam will be our first in providing tanker services in the oil and gas industry," he said.

(c) 2008 New Straits Times. Provided by ProQuest Information and Learning. All rights Reserved.

A service of YellowBrix, Inc.

Vietnam suspends gold import to tame trade deficit

Commodity Online
HANOI: Vietnam has chosen a novel method to contain trade deficit that has tripled this year—temporarily ban gold imports.

Vietnam, the second largest gold investor in the world has already imported 60 tonnes of gold valued at US$ 1.8 bn, a 100 percent increase over the same period last year. The price of gold was quoted by local dealers at around $US873 an ounce, lower than international prices

The suspension of gold imports is not likely to raise domestic prices because of plentiful supplies and weak demand. This is as part of the country’s effort to rein in inflation.

But traders added only a prolonged suspension could cut domestic supplies and trigger a scramble for safe-haven assets. Fears that the dong could fall in value are making dollar holders reluctant to let go of their foreign exchange.

Traditionally, Vietnamese use gold for savings, jewellery and real estate transactions but when inflation is high many choose gold or the U.S. dollar to hedge against inflation.

The central bank have given quotas to 40 banks and trading houses to import 73 tonnes of gold in 2008, up slightly from about 70 tonnes in 2007.

Vietnam imported 77.7 tonnes of gold for jewellery and investments in 2007. On the other hand main gold consumer India imported more than 700 tonnes last year. Analysts,however, don't expect the Vietnamese decision to have any significant impact on gold markets.

Following a year of overheating and high credit growth, 2008 has been strained for Vietnam, where macroeconomic stability was taken for granted as it boasted one of the world's highest growth rates, averaging 7.5% a year since 2000.

Monday, June 23, 2008

Gold prices climb higher in Vietnam

HCMC gold moves up above VND19 million per tael

The gold price increases at a gold shop in Ho Chi Minh City during a volatile day’s trading Thursday
The gold price in Ho Chi Minh City Thursday broke VND19 million (US$1,146) per tael, as the value of the precious metal on global markets also rose.

Gold at the Saigon Jewelry Joint Stock Company, the city’s biggest gold trader, rose VND300,000 to VND19.05 million ($1,190) per tael at Thursday’s close of trade.

In New York, gold rose to a one-week high on speculation that surging costs of raw materials will boost demand for the precious metal as a hedge against inflation.

Gold reached an all-time high of $1,033.90 an ounce on March 17 as corn, crude oil and other commodities soared to records this year.

Gold futures for August delivery gained $14.50, or 1.6 percent, to $908 an ounce at 9:29 a.m. on the Comex division of the New York Mercantile Exchange.

Earlier, the price reached $911, the highest for a most-active contract since June 9.

Silver futures for July delivery climbed 32 cents, or 1.9 percent, to $17.66 an ounce.

Before Thursday, the price had advanced 16 percent this year, while gold climbed 6.6 percent.

A firm US currency makes metals priced in dollars expensive for holders of other currencies, while gold is seen as a store of value during times of inflation.

The dollar rallied broadly on Thursday, benefiting as the Swiss National Bank’s decision to keep its interest rates on hold stalled the Swiss franc’s overnight advance.

Gold has climbed this week on a weaker dollar.

“Gold prices have been able to rally recently in large part because the US Federal Reserve and European Central Bank softened their anti-inflation rhetoric,” HSBC said in a note. “Thus reducing the prospect of imminent monetary policy tightening and allowing financial markets to re-evaluate the chances of a US rate rise.”

Oil steadied on Thursday, supported by a further production outage in Nigeria and as a top US investment bank raised its oil price forecast.

US crude CLc1 was down 1.07 cents to $135.61 a barrel.

Meanwhile, the Kim Hoan Viet gold shop in HCMC’s District 1 was more crowded than usual Thursday.

The shop owner told Thanh Nien most visitors were there to sell.

Phu Nhuan Jewelry Joint Stock Company Deputy General Director Nguyen Thi Cuc said many people, in contrast, visited her firm’s shops to buy on the expectation that the price will move up further.

The Vietnam Association of Gold Trading Deputy Chairman Huynh Trung Khanh said the precious metal price was volatile.

Gold would reach $1,000 per ounce in the second half of this year because of growing demand, Khanh predicted.

Inflation juggernaut bears down on Vietnam bourse

By Amy Kazmin in Bangkok

Published: June 19 2008 03:00 | Last updated: June 19 2008 03:00

It has to be one of the worst ever stock market runs. Ho Chi Minh City fell every trading day in May and early June amid gloom over skyrocketing inflation and an economy seemingly going off the rails.

By the time the market had finished its 25-day slide last week, the index was down 60 per cent from the start of the year, making it the world's worst performer.

Vietnam's problems illustrate the difficulties of many emerging market countries as they struggle to keep a lid on inflation.

After years of growth, these economies are facing questions over how to contain rising prices, exacerbated by the soaring value of oil and food.

Inflation in the 20 largest emerging market economies rose to 6.9 per cent in March from 4.5 per cent in March last year, according to Fitch.

In Vietnam, inflation hit 25 per cent at the end of May, the highest level since 1993.

However, there are signs Vietnam's market may be at a turning point as Hanoi signals a growing determination to battle inflation even if it means sacrificing growth.

On four of the past five trading days, Ho Chi Minh City has risen, gaining nearly 4 per cent in total. Volumes have increased from $2.4m on June 10 - the day before it hit bottom - to $20m on Tuesday.

"I am not saying this is the end of the bear market," Kevin Snowball, a director at Ho Chi Minh City-based PXP Asset Management, said.

"It may be that it turns out to be the proverbial dead cat bounce. But for the time being, we are stepping back and having a look at whether there is any conviction on the upside."

Selling pressure seemed to ease after the State Bank of Vietnam raised an interest rate last week to 14 per cent from 12 per cent, its second rate rise in three weeks, as part of an increasingly aggressive monetary tightening.

Previously, it had relied on administrative edicts and mandatory bond purchases by banks to drain liquidity.

"The central bank is starting to develop a more sophisticated monetary policy framework, one which uses interest rates in a more transparent way," Benedict Bingham, the IMF's resident representative in Hanoi, said.

But many still worry over whether Hanoi is doing enough to curb its spending and spending by state-owned enterprises - a factor in the overheating.

"The fiscal stance for 2008 is not yet clear to investors," Mr Bingham said.

"The government needs to put the pieces together and answer the basic question that everyone is asking, which is: Is fiscal policy going to pull in the same direction as monetary policy?"

The jury is out on whether Vietnam, like the rest of the emerging market universe, will be able to tackle the serious problems that inflation is creating for its economy and markets.

Vietnam creates 780,000 jobs in 6 months

780,000 jobs created in six months
13:34' 22/06/2008 (GMT+7)

At an employment service centre in Hanoi
VietNamNet Bridge – Around 780,000 people got jobs in the first half of 2008 while 43,000 others went abroad to work, Deputy Minister of Labour, War Invalids and Social Affairs Dam Huu Dac said on June 19.

“With 780,000 new jobs created so far this year, we have achieved half of the target for 2008,” Dac said.

As for manpower export, Vietnam has fulfilled 50.6% of its yearly target, with 43,000 sent abroad so far this year. Meanwhile, nearly 650,000 people were admitted to vocational training schools, including 55,000 to vocational training colleges and secondary schools.

However, there is a paradox in the labour market that industrial and export processing zones in the northern provinces of Bac Ninh, Thanh Hoa and Ha Tay lack tens of thousands of technical workers and trained labourers.

“Why are we exporting workers instead of training them for local businesses?” Dac asked.

In Hanoi and HCM City, large numbers of workers have quit jobs due to low salaries, a result of inflation.

Vietnam attracts over $30 bln of foreign investment in first half

HANOI, June 21 (Xinhua) -- Vietnam attracted 31.6 billion U.S. dollars in foreign direct investment in the first half of the year, as against 20.3 billion dollars of the whole 2007, said a senior economic official here Saturday.

The figure proved that foreign investors remained confident in Vietnam although its economy was experiencing great difficulty, said Cao Viet Sinh, Deputy Minister of Planning and Investment

The country is likely to attain a gross domestic product (GDP) growth rate of between 6.6 and 6.7 percent in the first six months, said Sinh, adding that the rate helps ensure the targeted growth for the whole year of 7 percent set by the National Assembly.

Also in the six months, the country earned 29.7 billion dollars from exports, said the deputy minister.

Vietnam to finalize many major US-Vietnam contracts

PM’s visit to US tipped to create windfalls

The US Ambassador to Vietnam Michael Michalak said he expected American and Vietnamese businesses to finalize many major contracts during Prime Minister Nguyen Tan Dung’s visit to the US next week.

Some of the deals signed during the June 23 to 26 visit could have a significant effect on the Vietnamese economy, Michalak told a press conference in Hanoi.

Dung is scheduled to meet President George W. Bush at the White House on June 24.

Michalek said Bush was looking forward to the meeting, adding that the two sides would discuss not only the economic relationship but also other issues, including regional security.

The two countries’ leaders have exchanged several visits in the past four years.

Former Prime Minister Phan Van Khai visited the US in 2005and President Nguyen Minh Triet last year, while Bush visited Vietnam in 2006.

Dung and Bush met once last year at a session of the United Nations Security Council, Michalak said.

He believed Dung’s visit would be successful and would raise the bilateral relationship to a new level.

During his visit, Dung will meet a number of senior officials of the US administration as well as congress leaders.

He will hold talks with Alan Greenspan, former Chairman of the US Federal Reserve, about Vietnam’s high inflation in Vietnam, Michalak said.

Dung will meet the leaders of some major American firms and make a speech at Texas University.

Michalak expected the two countries would also sign some agreements on cooperation in education and science and technology.

Reported by Xuan Danh

Vietnam announces co-op with Romania in oil and gas

NA Chairman seeks effective co-operation with Romania in oil and gas
12:10' 22/06/2008 (GMT+7)

VietNamNet Bridge - Vietnamese National Assembly Chairman, Nguyen Phu Trong, has said Vietnam wishes to further co-operation with Romania in the oil and gas industry.

The Chairman on June 20 made a visit to Petroconsult, a prestigious consulting company in the oil and gas industry in Romania .

The Vietnamese leader lauded the company’s support to Vietnam’s fledgling oil and gas industry and said Vietnam needs more help from Petroconsult in consulting, training personnel, oil refinery and petrochemistry.

Petroconsult Executive Manager Mircea Laba said during its six-year co-operation with the Vietnam Oil and Gas Corporation (PetroVietnam), the company has joined in consultancy and training workers for the Dung Quat oil refinery complex and the Phu My gas-electricity-fertiliser plan.

The manager affirmed that Petroconsult is eager to expand its ties with PetroVietnam and take part in other refinery projects in Vietnam.

The same day, Chairman Trong received leaders of the Romania-Vietnam friendship association and the Romania-Vietnam mutual friendship association.

The leaders of the Romanian friendship associations promised to work hard to accelerate the economic, trade, cultural co-operation between the two countries.

Chairman Trong also met with Paul Niculescu Mizil, a Romanian statesman who took part in many activities to support Vietnam's struggle for national independence and was author of a book on the US-Vietnam war.

In the afternoon, Chairman Trong and his entourage left Bucharest to Bulgaria , their third leg of a fortnight trip to four European countries.

(Source: VNA)

Sunday, June 08, 2008

Vietnam PM: Won't Devalue Dong, May Soon Wider Trading Band-BIDV

Dow Jones

June 06, 2008: 08:11 AM EST

HANOI -(Dow Jones)- Vietnam's Prime Minister Nguyen Tan Dung said the government has no plan to devalue the dong but may soon widen the currency's trading band, the country's second biggest state-owned bank said in a statement following a meeting Friday with Dung.

The prime minister, who met with a JP Morgan chief economist David Fernandez and General Director Tran Bac Ha of the Bank for Investment and Development of Vietnam, said the country is financially strong and had a surplus of $1 billion in its current account during the first five months of this year, according to BIDV.

"Though Vietnam is under pressure the country has no reason to devalue the dong," Dung said, according to the statement.

Dung said that because Vietnam has a surplus of foreign exchange, the daily trading band for the dong could soon be widened to plus or minus 2% around the officially set rate, up from 1% now.

It's government policy to have a 2% trading band against the dollar but the central bank continues to keep the dong in a 1% band.

-By Nguyen Pham Muoi, Dow Jones Newswires, 84-913-220-614; phammuoi.nguyen@

Vietnam to protect its rice fields

[This is the print version of story]

Vietnam to protect its rice fields

Updated June 7, 2008 09:56:17

Vietnam has announced plans to protect around four million hectares of rice fields, to ensure long-term national food security.

According to state media, Deputy Prime Minister Hoang Trung Hai instructed the Agriculture Ministry to prepare a Rice Cultivation Land Management decree.

Vietnam's economic boom has seen rice land in the Mekong and Red River deltas shrink, from about 4.5 million to 4.1 million hectares between 2000 and 2006.

Aside from the building of new factories, rice paddies are also being reduced by more than 120 golf courses that are either in operation or being planned.

Vietnam's Dung Quat EZ lures 27 more projects

The Dung Quat Economic Zone in central Quang Ngai province has so far this year attracted 27 more projects, with a combined capital of around 500 million USD.

The projects have brought the total number of investments licensed or accepted by the Dung Quat Economic Zone Management Board to 161, valued at more than 10 billion USD.

The economic zone is expected to report an industrial, trade and service value of 1 trillion VND and generate 2,250 new jobs in the first half of this year. A total 350,000 tonnes of cargos are estimated to go through its Dung Quat Port in the period.

The management board said it is accelerating the expansion of the economic zone from the current 10,300 ha to 50,000 ha to be capable of receiving large projects such as an oil refinery, a steel mill and a thermo-electric power plant.