Vietnam’s five-year bonds fell this week on speculation investors trimmed holdings of debt, preferring to buy stocks after the government said economic growth may accelerate next year. The dong was little changed. The VN Index, the benchmark measure of the Ho Chi Minh City Stock Exchange, climbed 1.4% Friday to close at the highest level since Sept. 4 last year. The government is targeting 5.2% economic growth this year and 6.5% expansion in 2010, Deputy Prime Minister Hoang Trung Hai said at the World Economic Forum meeting in Dalian, China Friday (11 Sep 2009). The yield on the five-year notes rose 20 basis points to 10.03% this week, according to a daily fixing price from banks compiled by Bloomberg. A basis point is 0.01 percentage point.

Vietnam exported over 96.6 million USD worth of goods to Chile in the first seven months of the year, representing a year-on-year increase of nearly 140.3%. Of the total, crude oil exports accounted for over 62.8 million USD, or 65% of total turnover, according to the statistics of the Chilean Ministry of Foreign Affairs’ Export Promotion Bureau, ProChile. Thanks to crude oil, by the end of May, Vietnam’s exports to Chile exceeded last year’s figure of over 80.6 million USD. This sharp increase helped bring two-way trade in the seven-month period to 147.7 million USD, up 39.3%, despite, Chile’s exports to Vietnam decreasing by 22.4% to over 51 million USD during the period. Vietnam mainly exports footwear, coffee, clothing, fiber and seafood to Chile while importing bronze, cod-liver oil, fir, salmon, paper pulp, grapes and champagne from the Latin American country.

Vietnam’s Five Star International Group is planning to build a 65-million-USD fertilizer plant in Cambodia, Vietnam’s trade mission in Cambodia said. The project has been submitted to the Council for the Development of Cambodia for approval. If approved, construction of the factory would kick off in October and be completed after 20 months. The planned location is Kien S’vay district, 20 km to the east of Phnom Penh. The plant is designed to produce 350,000 tons of fertilizer a year. Once operational, the plant will also help Cambodia cut down its fertilizer imports, thereby reducing production costs.

ZTE Corp has partnered with Vinaphone, subsidiary of Vietnam’s largest operator, VNPT Group, to build all of Vinaphone’s UMTS networks in the central provinces of Vietnam. ZTE will provide Vinaphone with its advanced SDR base stations to support the UMTS network. ZTE’s base station solutions are claimed will maximize Vinaphone’s ROI and bring unparalleled subscriber experience and access with UMTS high-speed data services. Vinaphone has stringent demands for project implementation. ZTE has won recognition from Vinaphone for its SDR solutions and HSPA+ and LTE capabilities. ZTE says it is the first to deliver, install and adjust a trial UMTS network in Vietnam, and the first equipment provider in Vietnam to deliver networks that enable 3G calls and 3G core services.

Vietnam is expected to be among the ten top cement producers in the world by 2010. According to the Vietnam Cement Industry Corp., there are 105 cement plants with an installed capacity of more than 61 million tons. Last year’s output was 40.1 million tons. China topped the list with 1.3 billion tons a year in 2007, followed by India with 160 million tons, the US with 95.5 million tons, Japan with 68 million tons, Thailand with 65.7 million tons and Spain with 54 million tons.

For investors keen on getting in ahead of the crowd, the UK daily Telegraph recommends an investment in Vietnam now while it is still cheap. The online newspaper said that the country certainly has a lot going for it. It has one of the highest literacy rates in Asia, at 90%, and the workforce is young, hard-working and optimistic.  Almost two-thirds of Vietnam’s 85 million people are under the age of 35 – and this should support economic growth over the medium term. For the 10 years before the credit crunch hit, Vietnam was Asia’s second-fastest growing economy after China. The country tabled an average growth in GDP of 7.5% a year. This year’s government target is 5%. While noting that there are limited ways that a UK investor can invest in this fledgling economy, the newspaper recommended the Vietnam Opportunity Fund, which is managed by country specialist VinaCapital, as one of the easiest ways for UK investors to play growth in the Asian nation.

A Vietnam Business Forum in Europe, the fourth of its kind so far, was organized in the German capital city of Berlin from September 11-13. The forum, entitled ‘Challenges and opportunities for Vietnamese businesses in Europe,’ brought together more than 200 outstanding Vietnamese entrepreneurs from 10 European nations and a number of delegations from the home country. This year’s forum took place at a time when European countries are coping with the adverse impacts of the global financial crisis. It served as a venue for overseas Vietnamese businesspeople to share experiences in an effort to weather difficulties and step up business and investment both in the resident countries and in the home land. At the forum, which was held annually in European countries, the AVBE was renamed the Union of Vietnamese Businesses Associations in Europe.

The central banks of Russia and Vietnam have signed a deal to allow payments for bilateral trade in national currencies, the Russian regulator said in a statement on Monday (14 Sep 2009). “In order to carry out payments and settlements in national currencies, the authorized Russian and Vietnamese banks can carry out the purchase and sale of roubles and dong, as well as mutual lending,” the statement said. “The signing of the deal became an important step in realising the proposal about a move of the Russo-Vietnamese trade to payment in national currencies, which were aired during a meeting of Russian and Vietnamese presidents in October 2008.” Russia is seeking a greater world role for the rouble, with officials saying it could eventually becoming a regional or even a global reserve currency.

The Asian Development Bank on Tuesday approved a USD 500 million short-term loan to Vietnam to bolster the economy and ensure social stability as the Southeast Asian country is buffeted by the global downturn. The five-year loan from the ADB’s Countercyclical Support Facility will provide budgetary support for Vietnam to finance critical public expenditure programs this year and next, it said in a statement. The loan proposal said Vietnam’s forex reserves had fallen since the end of last year and its external balances were vulnerable to "modest shocks". It also projected the fiscal deficit would be 10.3% of GDP this year, but said the government debt position was "sustainable".

Foreign investors were net sellers of VND195.7 billion (USD 11 million) of Vietnamese stocks Tuesday (15 Sep 2009) out of a total VND3.6 trillion traded, the Ho Chi Minh Stock Exchange said. Volume traded totaled 72.4 million shares, with foreigners accounting for 5% of that volume, the stock market operator said. Foreign investors have been net sellers for seven straight sessions. In the month to date, they have been net sellers of VND483 billion of Vietnamese stocks.

Sales of steel used in construction in Vietnam will rise about 28% YoY in 2009 from a year earlier, Thanhniennews.com quoted Mr Dinh Huy Tam general secretary of Vietnam Steel Association as saying. He added that "Construction steel sales will grow in the coming months as the government plans to boost investment in construction projects to help achieve economic expansion of about 5.2% this year." According to Mr Tam, sales of steel used as building materials, known as long products, rose by 23% YoY through the end of August 2009 from the same period a year earlier, to 2.7 million tonnes. He added that VSA expects sales of construction steel in 2010 to increase at least 12% as the government targets economic growth of 6.5%.