VN Business News (Mar 28, 1997)

[Dam Son <son@fermi.phys.washington.edu>]

   Asian Cash Rice Steady Amid Active Vietnamese Shipments
   Golden Frontier to make cartons in Vietnam 
   Vietnam: TEC Sets Up Joint Venture Engineering Firm
   Saigon firm scandal puts thousands of jobs at risk 
   Vietnam slams record of state-owned trading firms
   Viet Prime minister bans timber exports from Vietnam: report

                                      
   Friday, Mar 28, 1997 [39]... Back to headlines
   
   _[INLINE] Asian Cash Rice Steady Amid Active Vietnamese Shipments_
   
   SINGAPORE (Dow Jones)--Asian physical rice offers are holding steady
   Friday amid active shipments of Vietnamese rice, trade sources said.
   
   March shipments are up because of large orders from the Philippines
   and Malaysia, they said.
   
   The Philippines contracted 200,000 tons of Vietnamese 25% brokens on a
   government-to-government basis. And according to a trade source in Ho
   Chi Minh city, shipment of the initial Philippine order of 100,000
   tons should be completed sometime in April before shipment of the
   remaining 100,000 tons starts.
   
   Shipments of Vietnamese 100% white rice that Malaysia likely
   contracted in late February are also going on. The country, according
   to the Ho Chi Minh city trade source, contracted another 13,000 tons
   of the rice in mid-March.
   
   According to a source with a cargo surveyor in Ho Chi Minh city, other
   vessels loading at the port include one bound for Cuba with 13,000
   tons of 25% broken rice and two going to Indonesia with 7,300 tons and
   10,000 tons of 10% broken rice, respectively.
   
   In Thailand, the market is still quiet, a trader there said. Offers
   for Thai 100%B rice are heard unchanged at $320-$325/ton, but he said
   the rice was heard traded at $332/ton last week.
   
   Offers for Thai 25% broken rice remain steady at $268-$270/ton owing
   to active shipments of that grade to the Philippines and of the 100%
   broken rice to some African countries.
   
   Elsewhere, offers for 25% broken rice are at $225-$230/ton in Vietnam
   and $210-$215/ton in Pakistan.
   
   No offers are available from India, owing to a holiday there.
   
   -By Joyce Teo 65-421-4825
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   Friday, Mar 28, 1997 [40]... Back to headlines
   
   _[INLINE] Golden Frontier to make cartons in Vietnam_
   
   The New Straits Times
   
   DIVERSIFIED group Golden Frontier Bhd plans to begin production of
   corrugated cartons at its first off-shore plant in Vietnam by
   September.
   
   Its chief executive officer and managing director Datuk Khor Ten Haw
   said yesterday the plant, which will be located in Ho Chi Minh City,
   would meet the needs of multinational companies operating in the
   country.
   
   Golden Frontier's investment in Vietnam is via a 35 per cent equity
   participation in Carian Wawasan Sdn Bhd, which holds a 70 per cent
   equity in Alcamax Packaging ( Vietnam) Co Ltd.
   
   Alcamax is newly registered in Vietnam and has obtained a licence from
   the Vietnamese Ministry of Planning and Investment for the manufacture
   of corrugated fibreboard cartons.
   
   "Our initial investment in this venture is RM12.25 million and we hope
   to increase it to RM36.75 million within five years," he told a Press
   conference after the company's 24th annual general meeting at the
   Equatorial Hotel in Penang.
   
   Also present were Golden Frontier chairman Datuk Mohd Ghazali Mohd
   Khalid and its executive director Steve Leow.
   
   Khor said Vietnam's population of 80 million served as a good market
   for Golden Frontier's paper and board products.
   
   "The country has a market for 0.25 million tonnes of paper a year.
   
   "Eighty-five per cent of the output from the Vietnam plant will be for
   the local market while the other 15 per cent will be exported," he
   added, saying that the local clientele would include soft-drink
   companies.
   
   Meanwhile, Mohd Ghazali said the carton industry in Malaysia was
   valued around RM1 billion with an annual market estimated at 500,000
   tonnes.
   
   "Golden Frontier has captured 12 per cent of this market," he said,
   adding that the company had also captured slightly more than 3.2 per
   cent of the Malaysian corrugated carton market.
   
   For the financial year ended Sept 30, 1996, Golden Frontier posted a
   pre-tax profit of RM2.01 million, a 34 per cent increase against the
   previous RM1.499 million.
   
   This was achieved on the back of a RM60.2 million turnover, which went
   up 65.4 per cent compared to the previous RM36.4 million.
   
   "We forecast a 11 per cent growth rate for the company this year and
   will continue to manufacture sophisticated products to meet the
   demands of our customers," he said.
   
   He also said subsidiary Golden Frontier Technology Sdn Bhd would serve
   as the group's launching pad for the precision components parts
   market.
   
   "This is through the production of high quality precision plastic
   mouldings for local and export markets," he added.
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   Friday, Mar 28, 1997 [41]... Back to headlines
   
   _[INLINE] Vietnam: TEC Sets Up Joint Venture Engineering Firm_
   
   Japan Chemical Week
   Comline Daily News Chemicals and New Materials Toyo-Thai Corporation,
   a subsidiary of Toyo Engineering (TEC) incorporated in Thailand,
   headquartered in Bangkok, has established in Ho Chi Minh City,
   Vietnam, a joint venture engineering firm, Toyo- Vietnam Corporation,
   the first joint venture engineering firm with a foreign company in
   Vietnam. The new company was established with capital of $500,000, 70%
   of which was invested by Toyo-Thai and 30% by Vietnamese capital
   (individuals).
   
   Toyo-Thai also announced that it had received an order from Japan
   Vietnam Fertilizer Co. for a 350,000-t/y compound fertilizer plant at
   about JPY4 billion ($33mn). The plant will adopt a process developed
   by Central Glass and will be completed in 1998.
   
   Toyo-Thai was established in 1985, and has become the largest
   engineering firm in Thailand. It established the engineering firm in
   Vietnam to promote international specialization and technology
   transfer, and intends to develop plant engineering business actively
   in the Vietnamese market.
   
   Toyo- Vietnam Corporation will act as a subcontractor for Toyo- Thai
   in the compound fertilizer plant project from now on. TEC, Toyo-Thai,
   and the new company in collaboration will have an edge on competitors
   in receiving orders for projects by foreign companies making inroads
   into Vietnam.
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   Friday, Mar 28, 1997 [42]... Back to headlines
   
   _[INLINE] Saigon firm scandal puts thousands of jobs at risk_
   
   HANOI (Reuter) - The jobs of 8,000 Vietnamese workers could be at risk
   if steps are not taken to ensure business as usual at the Ho Chi Minh
   City firm Minh Phung following the arrest of its director, a district
   union official said on Friday.
   
   ``The situation is quite worrying,'' said the official, who declined
   to be named. ``The employees are worried that if they work they won't
   get paid because all the company's cash was seized by the police.''
   
   The company's director, Tang Minh Phung, was detained last Monday by
   police on a charge of ``taking advantage of confidence to appropriate
   citizens' and socialist property.''
   
   A major southern garment exporting company with business stretching
   across a range of activities, Minh Phung is among several firms which
   have come under scrutiny over real estate speculation during a brief
   boom in the early 1990s.
   
   Economists say the firms involved used influence and connections to
   secure huge multiple loans from commercial banks, which are now
   sitting on a mountain of bad loans.
   
   Many Minh Phung employees, whose monthly pay ranges from 700,000 dong
   ($60) to 1.5 million dong ($129) a month, stayed away from work after
   Phung's arrest because they believed wages would not be paid.
   
   The union official said local authorities were trying to intervene to
   keep the Minh Phung going and the police would be asked to return
   company funds.
   
   The Saigon Times Daily said the local People's Committee had set up a
   steering committee to keep the company on an even keel.
   
   ``The board has discussed the nomination of an acting director for the
   company and measures to help enterprises facilitate garment exports
   and material import and pay workers' salaries,'' it said.
   
   The union official said that if worse came to worst, one solution
   might be for state-run companies to hire workers from Minh Phung, many
   of whom are migrants from outlying provinces.
                    ___________________________________
                                      
   Friday, Mar 28, 1997 [43]... Back to headlines
   
   _[INLINE] Vietnam slams record of state-owned trading firms _
   
   HANOI (Reuter) - Vietnam delivered a stinging critique of state-run
   trading companies on Friday, saying that many had been knocked
   sideways by the advent of market economics and just 30 percent had
   made a profit in the past five years.
   
   ``...The majority of state trading companies are operating with
   difficulties and running disappointing losses,'' the official Vietnam
   News Agency (VNA) said in an unusually critical report.
   
   ``In a recent report, the Ministry of Trade acknowledged that over the
   past five years only 30 percent of its trading companies have returned
   a profit while 30 percent are making serious losses. The other 40
   percent are experiencing grave difficulties in maintaining their
   capital,'' it said.
   
   VNA did not specify what it meant by trading companies, but gave
   machinery, packaging and textile firms as examples.
   
   It said that state-run trading firms' performance was poor when
   compared with private ones, which control more than 75 percent of the
   retail market.
   
   ``This has prompted many market experts to raise doubts about the
   advisability of the state's efforts to maintain its own trade
   industry,'' it said.
   
   Open debate on the role of the state sector is extremely rare in
   Vietnam even though the Communist Party embarked on economic reform
   along market lines more than 10 years ago.
   
   The number of state-owned firms has been halved to some 6,250 as part
   of the reform effort in an effort to cut away dead wood.
   
   Nevertheless, the party affirmed at a policy-defining congress last
   year that the state sector's ``leading role'' would be safeguarded.
   
   It has ruled out privatisation, despite ambitions to set up a stock
   market, and even its more modest plan for partial privatisation, or
   ``equitisation,'' is moving at a glacial pace.
   
   VNA quoted other experts as saying that state trading companies were
   still needed as a stabilising factor.
   
   ``The party shares this view by asserting the indispensability of the
   state trading sector,'' it said. ``However, how to help it live up to
   its function remains a tough question.''
                    ___________________________________
                                      
   Friday, Mar 28, 1997 [44]... Back to headlines
   
   _[INLINE] Viet Prime minister bans timber exports from Vietnam: report_
   
   HANOI (AFP) - Vietnamese Prime Minister Vo Van Kiet said the
   government will put a halt to all timber exports for the next decade
   given the alarming rate of deforestation, a report said Friday.
   
   Kiet told local journalists in Hanoi on Thursday said that the
   government would ban exports of all types of timber in the next
   10-to-15 years starting from 1997, the union Lao Dong newspaper
   reported.
   
   He said that the government had plans to import timber to meet
   domestic consumption and export processing.
   
   Most Vietnamese timber exports are unprocessed logs and the country is
   losing a large amount of timber through smuggling.
   
   Vietnam plans an ambitious reforestation plan to plant some six
   million hectares (14.8 million acres) of forests by 2005, to increase
   forest coverage from 28 percent of total area to between 40 and 50
   percent.
   
   The decision by the government to close entrances to forests have
   aroused some concerns over the livelihood of some ethnic minority
   groups who rely on slash and burn cultivation, the paper said.
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