Vietnamese handicraft. Handicraft exports to EU limited due to poor designs.
The EU is a potential market for Vietnam’s handicraft products, especially ones made of bamboo and rattan, but the export turnover
of such products is still low due to a lack of market information and creativity in designs, experts said at a seminar in Hanoi this week.
Little changes in design
[Vietnam furniture stock - kodasaigon - 400]
According to the Department of Processing and Trade for Agro-Forestry-Fisheries Products and Salt Production, the handicraft sector has a large workforce with around 350,000 laborers.
Handicraft products are not only supplied for the domestic market but also for export to 120 countries
and territories with an average export turnover of US$200 million in recent years, with exports to EU ranking second.
But handicraft bamboo is making a long-awaited comeback, thanks to innovations in design and the trend towards environmentally friendly consumption.
"Of the wholesale customers who approach us, we end up signing long-term contracts with approximately 80 per cent.
According to Bao Viet Securities Company (BSC), Vietnam would get benefits once the US and Japan open their garment, footwear, seafood and pharmacy markets.
Meanwhile, drinks, farm produce and public procurement will bear negative impacts.
Especially, brewery manufacturers have been warned that the import tariff cut from 45 percent on beer and from 30 percent on fizzy drinks to zero percent once Vietnam joins TPP would put domestic manufacturers in a cutthroat competition.
However, in general, TPP will bring more benefits than harm. The US exports machines, equipment, worth $500 million a year. Meanwhile, Vietnamese garment exports to the US in the first eight months of the year alone reached over $5.65 billion, while the export turnover of footwear or wooden furniture products was over $1 billion.
The industries in which Vietnam has big advantages will enjoy the tariff cuts, which will help boost its exports to the TPP member countries.
Garment exports, which now bear the tax rate of 7-15 percent, would enjoy the zero tax rate. The same would occur with footwear products. Especially, Vietnam would not have to be too worried about the anti-dumping lawsuits like the ones it has faced in the US catfish and shrimp markets so far.
Give-up-everything syndrome and the escape of VN billionaires [Solid wood dining set - kodasaigon - 1389578666]
– Vietnamese billionaires, who have incurred big losses due to their too ambitious investment plans, have decided to “sell everything they can” to undergo a severe restructuring to change their look.
HAGL Group's Chairman Doan Nguyen Duc.
Bargaining and running away
Doan Nguyen Duc, President of the Hoang Anh Gia Lai (HAG) Group, one of the most well-known influential tycoons in Vietnam, has had a meeting with investors to inform the business strategy for 2013-2015, under which the group will abandon a half of the current business fields.
Duc has decided that HAG will focus on its two maim business fields in the future, including agriculture production with the sugar, rubber and palm oil projects, and real estate sector with the investment projects in Myanmar.
HAG will sell its hydropower projects in Vietnam and step by step scale down the mining activities before it sells mining projects. It also plans to sell stakes in wooden furniture manufacturing enterprises to workers, while HAG would hold some 20 percent of stakes in the enterprises only. .
[Solid wood dining set - kodasaigon - 177]
At first, developing hydropower plants was considered a strategic business field for HAG. However, the group later found out that the profitability was unsatisfactory, while better opportunities have come.
In fact, the plan of HAG to quit some business fields is predictable when Duc decided to slash the sale prices of apartments, narrow the business scale and offer to sell a series of hydropower plants. Meanwhile, Duc has poured big money into rubber, sugar projects and the huge real estate projects in Myanmar.
Abandoning a lot of projects when they still can bring profit is the only resort for HAG which owes money from left and right. It is estimated that the total accounts payable by the end of the second quarter of 2013 had reached VND19.4 trillion, including VND9.3
worth of short term debts.
Duc has realized that he has taken on too many projects, while the projects all need huge capital, which may threaten the group’s financial safety.
Dang Thanh Tam, who was listed among the top 10 richest stock millionaires, has admitted the big debts and the failures when investing in the banking sector, telecom. Tam has decided to withdraw from the finance investments, securities and real estate to focus on the main business fields – industrial zone development and investment promotion.
Mai Linh Taxi, the big guy in the transport service sector, has also abandoned some business fields to gather its strength on the advantageous sector.
No one could imagine before that a giant investor, who poured money into tens of business fields and set up branches in so many provinces and cities, would give up everything to focus on developing taxi, maintenance and trade services.
Striving for sustainable development
Analysts have noted that the “give up everything” syndrome has spread out among the business community, when the national economy has bogged down in difficulties which make assets less valuable and bank loans inaccessible.
Kinh Do (KDC) has withdrawn from finance and real estate projects which “gobble up” much money, to return to the traditional job – sweets manufacturing, which is believed to ensure a sustainable development.
Duc of HAG has stated that HAG will leave the real estate sector completely after 2015. This has been described as a daring move, as real estate development and wooden furniture manufacturing were the “launching pad” of Hoang Anh Gia Lai.
Border fair promotes Vietnam-Laos trade exchange
A week-long border trade fair in the northwestern province of Son La has attracted tens of thousands of visitors.
More than 100 businesses from Son La and Hoa Binh provinces, Hai Phong city and Laos’ Houaphanh and Oudomxay provinces brought to the fair a wide range of