VN Buss. News (Apr. 14-15, 1997)

[Vu Thanh Ca <vuca@envi.env.civil.saitama-u.ac.jp>]

Apr 15: Vietnam: Detergent Material Plant In Commercial Operation 
Apr 15: Asian Cash Rice Flat-Slightly Up; Vietnamese 25% Brokens Up 
Apr 15: HK's Peregrine Taps Acting Vietnam Chief After Arrest
Apr 15: KTGC Donates Cigar Machines to Vietnam 
Apr 15: Peregrine Captial Vietnam chief arrested 
Apr 14: Vietnam Has 26 Transport Projects Under Way 
Apr 14: Vietnam's Forex Club To Hold First Meeting 
Apr 14: Vietnam's AGRO, Forestry Processing Output Increases 
Apr 14: Vietnam Reforms Import-Export Operations 
Apr 14: Vietnam's national Highway 1A Undergoes Reconstruction 
Apr 14: Vietnam to Keep Exchange Rate Stable 
Apr 14: Korea Tobacco & Ginseng Donates CIG Plant to Vietnam 
Apr 14: Malaysian Ind. Zone Project in Vietnam gets first tenant

Vietnam: Detergent Material Plant In Commercial Operation 

Japan Chemical Week

Soft Chemical, headquartered in Haiphong, Vietnam, has inaugurated
commercial operation of its 12,000-t/y alkylbenzene sulfonate plant.
This is the first detergent material plant in the northern part of the
country. Soft Chemical has started to supply products to local
detergent and toiletries producers.

Soft Chemical was incorporated at the beginning of 1996 with $1.8
million capital, which was equally contributed by Tomen, Formosan
Union Chemical Corp. of Taiwan, and DASO of Vietnam. Formosan Union
Chemical is a producer of the main material alkylbenzene, while DASO
is the largest and the only private detergent/toiletries producer in
Vietnam.

About 1 km of pipeline was laid from the Haiphong Port to the plant,
as it was necessary to establish an effective infrastructure for
procuring materials.

Some expect that demand for detergent in Vietnam will grow rapidly by
20% per year for the time being. Accordingly, the plant may start
full-scale operation at an early stage.
                 ___________________________________


Asian Cash Rice Flat-Slightly Up; Vietnamese 25% Brokens Up 

SINGAPORE (Dow Jones)--Physical rice offers are flat to marginally
higher late Tuesday in Asia, with a slight price increase seen in the
Vietnamese low grade rice, trade sources said.

Vietnamese 25% broken rice are now offered at $208/ton, up from
$206/ton - the price last heard traded, said a trader based in Ho Chi
Minh city.

He said prices are getting a little support from the government which
has started buying paddy.

However, offers for the Vietnamese 5% broken rice are unchanged at
$240/ton.

In Pakistan, offers are holding firm at $215-$220/ton for the 25%-30%
broken rice and $225-$230/ton for the 15%-20% broken rice. While the
Pakistani 385 basmati rice offers are steady at $445-$450/ton.

Continuous demand from African countries and better local demand
spurred by the tight wheat supply situation in the country should keep
prices steady to higher, said a trader in Karachi.

In India, offers for 25% broken rice remain at $245/ton amid dull
trade. News of a reduction in interest rates, though seen bullish for
exports, isn't expected to stir the rice market, said a trader there.

'The government has announced the new credit policy for the next 6
months. I think there will be more incentives for exporters like the
lower export finance interest. It is now at 13% and I believe they're
reducing it to 12%,' he said. 'But right now, there is a lot of
political instability and not much trade is going on.'

He said trade may improve in a week's time when the political
situation stabilizes. In any case, trade for 25% broken rice should
remain dull, since regular buyers such as Saudi Arabia usually seek
the higher grade 5%-10% broken rice and the basmati rice.

No offers are heard from Thailand as markets there remain closed for
the Songkran Festival holiday.

-By Joyce Teo 65-421-4825
                 ___________________________________


HK's Peregrine Taps Acting Vietnam Chief After Arrest 

HONG KONG (AP, DJ) -- Following the arrest of its top representative
in Vietnam, Peregrine Investments Holdings Ltd. on Tuesday moved to
repair its operations there by tapping an official to run the
businesses.

Nguyen Trung Truc, managing director for Peregrine Capital Vietnam
Ltd., was arrested on Monday on charges of personal tax evasion,
according to the Hong Kong securities firm.

On Tuesday, the company said it had named Judd Kinne as acting
managing director of Peregrine Capital Vietnam. Kinne, 53, is managing
director of Peregrine Securities Singapore Pte. Ltd. and a director of
the parent firm's executive committee. Peregrine credits him with
establishing its business in countries of the Association of Southeast
Asian Nations (ASEAN).

Peregrine said in its statement Tuesday that Ho Chi Minh municipal
officials recommended fines of US$59,000 in February against the firm
because it hadn't been properly licensed.

Peregrine's chief counsel, Alan Mercer, said the firm protested that
the proposed fines as 'excessive in the extreme.' But he said 'we
considered the matter closed' in the firm's trouble with authorities
in the south Vietnamese city.

In addition to the charges against Peregrine, a municipal government
spokesman said in March that total fines were around US$100,000,
including charges levied against affiliated companies. The proposal
included a recommendation to strip licenses from several other
affiliates of Peregrine's Vietnam operations.

Mercer said Peregrine retains its operating licenses in the country.

'The (latest) charges against Truc were a bolt from the blue. The
exact nature of the charges against Truc are unclear,' said Mercer in
the statement.

He added, 'Naturally, we are concerned about Truc and his family and
are doing everything we can to assist the Australian consulate in Ho
Chi Minh City in its efforts to secure bail for him. Unfortunately, we
haven't been able to speak to Truc since his arrest.'

Mercer said in the statement that the firm's consumer product and auto
distribution businesses - built up 'given the slow development of the
Vietnamese capital markets' - had originally held out promise, but
have since proved 'a disappointment.'
                 ___________________________________


KTGC Donates Cigar Machines to Vietnam 

The Korea Herald

The Korea Tobacco & Ginseng Corp. (KTGC) has donated
cigarette-manufacturing and packaging machines to Vietnam's state-run
tabacco company.

Kim Young-tae, president of KTGC, and Hyunh Nhat Tao, president of
Vietnam's state-owned Phuyen Tobacco Co., signed a bilateral
memorandum of understanding on the donation of equipment and
cooperation in other fields, during a ceremony held in Ho Chi Minh
City yesterday.

In August 1996, KTGC and Phuyen Tabacco had signed a contract to
jointly produce KTGC's ``This'' cigarette in Vietnam.
                 ___________________________________


Peregrine Captial Vietnam chief arrested 

By Frederik Balfour

HANOI (AFP) - Vietnam police have arrested the managing director of
Peregrine Capital Vietnam (PCV), controlled by a major Hong Kong
investment firm, on tax evasion charges, officials said Tuesday.

A PCV company official confirmed press reports on Tuesday that Nguyen
Trung Truc had been detained by the economics police of Ho Chi Minh
City on Monday.

Truc's brother, Nguyen Vinh Quang told AFP by telephone that the
family had not been able to contact him. "He has been taken away. We
cannot reach him at the moment."

Peregrine Investment Holdings Ltd in Hong Kong, which holds a 60
percent stake in PCV acknowledged that Truc had been arrested, but
denied the company was implicated.

Tom Grimmer, director of Corporate Communications of Peregrine
Investments Holdings in Hongkong said the charges appeared to concern
Truc's personal finances.

"The complete nature of the charges is still unclear, but from what we
have seen, it is related to personal tax affairs," he told AFP.

Grimmer said Peregrine's Ho Chi Minh City office was working with the
Australian consulate to seek Truc's release on bail.

Troubles for the 44-year-old Vietnamese-born Australian began last May
when the Ho Chi Minh City offices of PCV were raided by the local
investigation bureau of the People's Committee Prosecution office,
part of the economic police.

The company was initially investigated for allegedly operating
unregistered "front companies" to circumvent the thicket of
bureacratic hurdles barring foreign companies from distributing
products directly in Vietnam.

In July the investigation office announced it would prosecute Truc and
his wife separately on income tax evasion charges involving more than
300,000 dollars.

Truc told AFP earlier he had been accused of evading between 50,000
and 100,000 dollars in income taxes. Truc's sister, Nguyen Thi Cuc,
was arrested in August on tax evasion charges.

The charges against the company were finalised on March 5 when PCV was
fined 10,000 dollars for operating from an unregistered office. A fine
of 50,000 dollars was recommended but not yet levied against the
group. To date no fines have been paid, said Grimmer.

Alan Mercer, spokesman for Peregrine in Hong Kong told AFP that PCV
"was not in the centre of a government investigation," saying "as far
as we're concerned, the matter has been closed."

But the matter remains very much open for Truc and his Malaysian wife
Deidre Low-Aili, who with a Singaporean businessman own 40 percent of
PCV.

PCV was set up in 1991 by Truc, who quickly built himself a reputation
as a high flyer, known for his fleet of antique cars and a flamboyant
business style.

"It's a classic case of the tall poppy syndrome," said a former
Peregrine employee in Ho Chi Minh City.

When Truc's home was contacted by AFP, Low-Aili was not available.
Local authorities have been holding both of their passports since last
June.

According to the Tuoi Tre newspaper, on Monday the economics police
arrested Truc and searched the offices of Peregrine and Truc's home.

A member of Truc's staff, Pham Thi Loan was also arrested on tax
evasion charges, the paper said.

PCV, which has property holdings in Ho Chi Minh City and a stake in
the local Mercedes Benz assembly plant, has continued operating.
                 ___________________________________


Vietnam Has 26 Transport Projects Under Way 

Hanoi (VNA) - Vietnam now has 26 transport and communications projects
underway, with some 85 percent of the combined investment capital of
US$1,305 million coming from ODA sources.

The projects include the first phase of the upgrading of National
Highway 1A, the repair and restoration of nine bridges along the
trans- Vietnam railway line, and the restoration and upgrading of
National Highway No.5, linking Hanoi with Hai Phong port city. Others
include the restoration and expansion of the Saigon port and the
restoration and upgrading of National Highway No.18, linking Bac
Ninh-Quang Ninh province in northern Vietnam.

Another 21 ODA projects capitalised at US$1,512 million are being
prepared for implementation.

These projects include the second phase of the upgrading and
restoration of National Highway 1A, the construction of the My Thuan
bridge across the Tien river in southern Vietnam, the restoration of
the Ho Chi Minh City-Ca Mau and the Ho Chi Minh City-Kien Luong (Kien
Giang) riverways, and the construction of a trans-Asia route.

The upgrading of the Danang port, the construction of a tunnel through
the Hai Van Pass in central Vietnam and the Binh and Bai Chay bridges
in the northern province of Quang Ninh, the restoration of Red River
shipping channels and the upgrading and building of bridges and roads
in rural areas are other second phase transport projects.

Of the total 47 ODA projects, 24 are in bridge and road construction
(accounting for 77 percent of the total capital), nine are in sea
routes (with ten percent of the total capital), five are in railway
construction (six percent of capital), three in riverways (four
percent in capital), and six others in industry and material supply
(three percent of capital).

Nearly 80 percent of the ODA funds in Vietnam have been provided by
the World Bank (WB), the Asian Development Bank (ADB) and Japans
Overseas Economic Cooperation Fund (OECF) while the remainders is from
the Australian, Belgian, French and Netherlands governments.

These include loans with preferential interest rates ranging from zero
percent to 2.3 percent and durations of 40 years including 10-year
grace periods. Non-refundable projects account for some 9.7 percent of
the total ODA capital disbursed in past years.

Apart from loans for construction projects, ODA is also supporting
technology, providing materials and equipment, and helping with
personnel training.

Meanwhile, 69 FDI (Foreign Direct Investment) projects worth US$599.5
million have been granted licences. Most of them are in automobile
assembly, ship repair and shipbuilding, equipment repair and hire,
materials production for communications, and port and road
construction.

One of the major projects is a ship yard in the central coast province
of Khanh Hoa worth US$100 million. The ship yard is a joint venture
between the Vietnam Shipping Industry Corporation (VINASHIP) and the
HYUNDAI group from South Korea, and expects to start operation later
this year.

The transport and communications industry has also started using the
Build-Operate-Transfer (BOT) formula following the construction of the
Sao Mai-Ben Dinh deep-water port with total investment of more than
US$600 million. The Ho Chi Minh City-Long Thanh-Vung Tau expressway
and the Hanoi ring road No.3 linking the Highway 1A with Highway No.5
( Hanoi-Haiphong) are being studied by a number of companies from
South Korea, the United States and Japan for possible BOT investment.
                 ___________________________________


Vietnam's Forex Club To Hold First Meeting 

Hanoi (WSJ) -- In a further sign of market evolution, the Foreign
Exchange Dealers' Club of Vietnam will hold its inaugural meeting
Friday.

The meeting is believed to be the first time representatives of all
the organizations involved in Vietnam's nascent foreign-exchange
market will have gathered together at one time.

Between 75 and 100 individuals are expected to attend, said Nguyen Thi
Ngoc Anh, director of foreign exchange at Bank for Foreign Trade of
Vietnam, known as Vietcombank.

Nguyen Hoa Binh, executive director of Vietcombank's operations
center, has been nominated to become president of the club.

The organization backs the training of dealers and participate in
drafting regulations to govern who can be involved in the interbank
market, Mr. Anh said.

The club will be open to both domestic and foreign traders and is
forming with the encouragement of the State Bank of Vietnam, the
central bank, said Peter McLean, head of treasury at Standard
Chartered Bank.
                 ___________________________________


Vietnam's AGRO, Forestry Processing Output Increases

Hanoi (VNA) -- Agricultural and forestry produce processing ventures
and other industrial units under the Ministry of Agriculture and Rural
Development (MARD) grossed VND 373 billion (roughly US$34 million) in
turnover in March, a year-on-year increases ranging from 7-17 percent.

Thirteen of MARD's farm and forestry produce production and processing
ventures obtained higher production compared with March last year,
including the Sugar Corporations I and II, the Coffee Corporation, the
Livestock Breeding Corporation, the Northern Food Corporation, the
Mulberry-Silkworm-Silk Corporation, and the Forest Product
Corporation. The Northern Food Corporation and the Livestock Breeding
Corporation registered year-on-year increases of 66 and 173 percent
respectively.

Output of 15 main items processed in March 1997 recorded increases
thanks to stable material sources and the expansion of outlets, such
as sugar, canned fruit and vegetables, assorted sweets, frozen meat,
and silk, with the last two increasing by 110 and 400 percent
respectively compared with March last year.
                 ___________________________________


Vietnam Reforms Import-Export Operations

Hanoi (VNA) - The past 10 years have seen considerable efforts made to
control imports and exports, according to an official from the Trade
Ministry.

Director of the ministry's Import-Export Department, Mr Hoang Tieh
Phuc, also told a workshop held here earlier this month that thanks to
reform in control of trade activities, almost all kinds of goods can
be imported or exported freely without any problems relating to quotas
and licences.

All local businesses which are licensed to carry out import-export
operations are allowed to conduct direct exports or to export goods
that they do not produce nor register for business under export trust
deeds, Mr Phuc told participants in a newly-ended workshop which
focussed on Vietnamese import-export and investment policies.

Mr Phuc reconfirmed that foreign-invested businesses are only entitled
to import machinery, equipment and materials to serve production, and
export their products.

The number of businesses licensed to undertake direct import-export
operations increased to 1,600 by the end of 1996, compared with 35
State-owned firms in 1987, when the country began applying a policy on
openness and renovation.

Of the 1996 figure, non-State businesses accounted for 18 percent with
this proportion rising.

Mr Phuc also listed goods essential to the national economy that have
been put under import-export control, including petrol, crude oil,
fuel, rice, coffee, motorbikes, fertilisers, steel, cement, clinker,
sugar, telecommunications equipment, and medicines.

Meanwhile, goods banned from import and export include weapons,
ammunition, drugs, toxic chemicals, rare animals, and antiques.

Banned from import are pornographic and anti-revolutionary cultural
products, firecrackers, used consumer goods (excluding motorbikes and
under 12-seater cars), cars with right hand steering wheels, and toys
that may cause harm to education and social security.

Logs, sawn timber, wooden products, and semi-processed rattan products
are banned from export.
                 ___________________________________


Vietnam's national Highway 1A Undergoes Reconstruction 

Hanoi (VNA) -- Upgrading of National Highway 1A is underway after the
completion of final preparation work. Two portions of the highway from
Hanoi to the central city of Vinh and Ho Chi Minh City to Can Tho are
now under re-construction at an estimated cost of US$176 million, with
US$156.5 million provided through the World Bank loans.

On the 100-km Hanoi-Doc Xay section, the COVEC contractor from China
has finished seven kilometres and is working on the third concrete
layer on the other eight kilometres of the 50 kilometres planned to be
built this year. The pace of construction in February and March was
two or three times faster than late last year, despite rain.

The Kukdong Company of South Korea has finished the second concrete
layer on 38 kilometres and the foundations on another 17 km of the 180
km-long Doc Xay-Vinh section, leading the five other contractors on
the highway.

The company has put a bituminous concrete mixing station into
operation in Thanh Hoa province to serve construction with a capacity
of 900 tonnes/day. Another station is scheduled to be operational in
Vinh, bringing the combined capacity to between 40,000-50,000
tonnes/month.

The two contractors started construction work in July last year.
                 ___________________________________


Vietnam to Keep Exchange Rate Stable 

Hanoi (Xinhua News) -- Vietnam's central bank said it will maintain
the current exchange rate of the Vietnamese dong against the U.S.
dollar in order to keep a stable currency, press reports said today.

The current exchange rate is 11,500 to 11,600 dong to the dollar.

In late February, the central bank allowed commercial banks to vary
official exchange rates by 5 percent, which prompted speculation of a
depreciation of the dong against the dollar.

Some enterprises have started to stockpile the dollar, resulting in a
freeze of bank loans.

At the beginning of the year, the dollar appreciated against the dong,
jumping from 11,100 dong for one dollar in late December to 11,200
dong. The dollar kept rising, gradually reaching its current 11,600
dong level.

"The stabilization of the exchange rate induces stabilization of other
things including commodity prices and inflation," a central bank
official said.

Experts said that fluctuations in the past months were due to a higher
demand for foreign currencies and a growing trade deficit since the
end of 1996.
                 ___________________________________


Korea Tobacco & Ginseng Donates CIG Plant to Vietnam 

SEOUL (Yonhap) - Korea Tobacco and Ginseng Corp. (KTGC) said today
that it has donated a cigarette soft packer and a film wrapper to the
People's Committee of Vietnam's Phuyen Province.

The state-run firm held a donation ceremony Monday morning at New
World Hotel in Seoul, with KTGC president Kim Young-tae and Phuyen
Tobacco Co. president Huynh Nhat Tao attending.

In the ceremony, the two sides exchanged a protocol on a one-year
exemption of consumption tax on "This", KTGC's cigarette brand sold in
Vietnam, and KTGC's continous supply of cut tobacco, a core material
for cigarettes.

The two companies also agreed to make a joint entry into the markets
of Laos and Cambodia.

The Korean cigarette maker sent a technical contingency, along with a
cigarette-producing facility, to the Vietnamese firm in 1995, followed
by the settlement of a contract last August to produce KTGC's "This"
cigarettes locally in Vietnam.
                 ___________________________________


Malaysian Ind. Zone Project in Vietnam gets first tenant

By Mohd Ghazemy Mahmud

Hanoi (AAP) - The Noi Bai industrial zone, operated by Malaysia's
Kinta Kellas, signed up its first tenant over the weekend, two months
after the completion of the first phase of the project, a company
official said Monday.

A lease agreement was signed with a Saudi Arabian firm, Zamil Steel,
for a four-hectare lot on which the company will set up a
pre-fabricated steel plant soon.

The official said several international and local firms had indicated
keen interest in the industrial zone, especially since the first phase
of the 100-hectare project was completed last February.

"It is a relief in a sense that the 50-hectare first phase was
completed and the first lot has been taken up," he added.

"We hope that more companies would come in the near future," said one
official of the Noi Bai Development Corporation Ltd, a joint venture
between Kinta Kellas' wholly-owned subsidiary Vista Spectrum (M) and
local partner Hanoi Industrial Construction Company.

"A number of companies scouting for industrial lots have visited the
site and were satisfied with the full range of facilities, including
full stable power back-up and water supply," he added.

Zamil Steel is a well known prefabricated steel company in Vietnam,
having built about 100 factories and warehouses over the past four
years, using its specialised construction technology.

The US$30 million (RM75 million) Noi Bai industrial zone project, not
far from the capital's international airport of the same name, is
offering industrial land for lease up till the year 2044.

Construction of the project's first phase, which has some 40
industrial lots, began in February last year following about a year of
site clearance and compensation problems usually associated with most
projects in Vietnam.

The project started as an export processing zone (EPZ) but its status
was changed to industrial zone in the middle of last year to attract
more tenants.

The Noi Bai project is one of two Malaysian EPZ/IZ projects in
Vietnam. The Malaysia South-South Corporation (Masscorp) has developed
the Danang EPZ in central Quangnam-Danang province.

A Renong official said the status change was to make the zone more
attractive. An IZ licence will attract foreign and local companies as
it allows them to either market their products locally or produce
totally for export.

A Malaysian conglomerate is also involved in a US$44 million hotel
project undertaken by a joint venture between Renong's Faber Group and
Vietnam's Ho Tay Corporation.

The 300-room international class hotel, to be operated by Sheraton
ITT, is scheduled for completion by the end of the year.