The Ministry of Planning and Investment said that the country is forecast to attract USD 20 billion in foreign direct investment (FDI) this year, nearly one-third of 2008’s figure, reported by a newspaper on Tuesday (13 Oct). The forecast was made on the slump in the country’s FDI performance in the first nine months this year as a result of impacts caused by global economic downturn, said the ministry. In the first nine months this year, Vietnam’s FDI saw a year- on-year decrease of 78.6 percent to about USD 12.6 billion, according to Vietnam General Statistics Office. The country’s FDI disbursement this year is expected to be USD 8.8 billion, a year-on-year decrease of 22%.

The Hanoi Department of Industry and Trade held a trade promotion conference on October 12 to make businesses better aware of the need to seek out new export markets. Present at the conference were business associations, various embassies, the European Chamber of Commerce and Industry (EuroCham) and export businesses from Hanoi. Matthing Duehn, director of EuroCham in Hanoi presented a range of export measures in respect of the current global economic crisis. The Indian Business Association and the Rumanian Embassy in Vietnam also proposed support programmes to help Vietnamese businesses export products to these two markets. Sergio Rivadeneyra from the Mexican Embassy highlighted Vietnam’s export potential and the Mexican Government’s support programmes to boost bilateral relations between the two countries.

The World Bank has recently provided an additional loan of 1.9 million USD (42 billion VND) to the southern-most province of Ca Mau for a rural electrification project. According to the Director of the Ca Mau Department of Industry and Trade, Le Minh Khoi, the financing will be spent to build an electricity grid spanning six communes of Khanh Hoa, Phu Thuan, Rach Cheo, Phu My, Vien An Dong and Dat Mui. Once completed in September 2010, the project will provide electricity to a total of over 4,300 households. The total cost of the project is estimated at 52.6 billion VND, with the majority (42 billion VND) being funded by the WB and the remainder coming from the provincial budget. The WB’s no-interest loan has a 40-year period with a 10-year grace period. This is the second loan that the bank has given to Ca Mau’s rural electrification project, following a previous grant of nearly 2 million USD in 2006.

The Song Hong Corporation under the Ministry of Construction will make an initial public offering (IPO) of 30 million shares via the Hanoi Stock Exchange (HNX) on November 5. Experts say with an initial price of 14,000 VND, shares of the Song Hong Corporation – a construction giant of a great number of realty, industrial and energy projects – are expected to stir up the gloomy IPO market. Although the HNX-Index and the HOSE-Index are on the increase with the traded value of each session reaching trillions of VND, only 20 businesses have made their IPOs through the HNX and the Ho Chi Minh Stock Exchange (HOSE) so far this year. Of the figure, HOSE organized six IPOs, a sharp drop from 16 last year. The number of IPOs organized by the HNX was also equivalent to one-third of last year’s total. Securities experts said that without the participation of big businesses with strong trademarks, IPOs fail to attract investors, leading to unsuccessful IPOs or low IPO share prices. In addition, sluggish transactions on unlisted markets prevent investors from pouring their investment into IPO to focus on the listed market.

A delegation from the Ministry of Industry and Trade led by Minister Vu Huy Hoang is on a working visit to China from Oct. 11-14, to discuss measures to raise two-way trade. The visit is to implement agreements signed in Hanoi last month at the first meeting of the Vietnam-China trade cooperation working group under the economic-trade cooperation committee, and discuss detailed measures to reach the goal laid out by the two countries’ leaders of raising two-way trade to 25 billion USD by 2010 as well as finding ways to overcome obstacles and facilitate two-way trade. At the talks with a Chinese delegation led by Chinese Minister of Commerce Chen Deming, the Chinese side agreed with Vietnam’s proposals on issues such as bilateral and multilateral trade, regional and bilateral cooperation in industry and investment, and the two ministries’ joint participation in Vietnam-China Friendship Year 2010 as well as all-around cooperation.

The Vietnam International Commercial Joint Stock Bank (VIB) racked up a nine-month, pre-tax profit of 124% of its yearly plan and double last year’s figure, fulfilling yearly targets three months before schedule. VIB also made headway in capital mobilization and granting loans. The bank’s total capital mobilized during the period was more than 44 trillion VND or 99% of its yearly target, representing a year-on-year increase of 38%. Its total loans outstanding were 25.5 trillion VND, equivalent to 103% of the yearly plan and up 29% compared to 2008’s correspondent period. The rate of controlled bad debts was kept low, about 1.5% of the total. In October, the bank plans to offer 20 million shares at a face value of 10,000 VND per share in order to increase its chartered capital to 2.4 trillion VND from the current 2.2

Foreign investors were net buyers of VND76.4 billion (USD 4.3 million) of Vietnamese stocks Tuesday out of a total VND3.86 trillion traded, the Ho Chi Minh Stock Exchange said. Volume traded totaled 85.6 million shares, with foreigners accounting for 4.3% of that volume, the stock market operator said. In the month to date, foreign investors have been net sellers of VND54.1 billion of Vietnamese stocks.

Vietnam’s total disbursement of foreign aids may reach USD 2 billion this year as an economic stimulus package boosts domestic businesses, according to a statement on the government’s website. In the nine months to September, the Southeast Asian nation disbursed about USD 1.71 billion, equivalent to 90 percent of the full-year target, to help local companies in need of capital, the ministry of planning and investment said in the statement. Vietnam has put in place tax exemptions and loan subsidies to boost growth, which slowed to 4.6 percent in the January-September period of this year from 6.2 percent in 2008.

Malaysian bank Hong Leong opened its latest branch in Ho Chi Minh City last week, becoming the first Southeast Asian bank licensed to operate in Vietnam. With an initial capital of VND1 trillion (USD55 million) Hong Leong would serve Vietnamese people and support trade between Malaysian and Vietnamese businesses, said Le Dinh Long, the bank’s general director. Long said bilateral trade worth about USD3 billion last year and Vietnam’s banking ratio with just 10 percent of the population having bank accounts present growth opportunities for Hong Leong Group to expand operations in the country. The group entered Vietnam over 11 years ago with its first investments in Yamaha Motor Vietnam and property development company Guocoland Vietnam. It plans to build a ceramic factory in Binh Duong Province next year.