VN Bus. News (May 7, 1997)

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

May 07: Vietnam: Over 120 economic cases tried so far this year 
May 07: Nike's Enemies: The Usual Suspects 
May 07: Thailand: Thai Glass To Build 900M-Baht Plant In Vietnam 
May 07: Thailand Jan-April Rice Shipments Dn On Yr; Vietnam's Up 
May 07: S. Korea LG Offers Finance Plan For Vietnam Refinery 
May 07: HCMC to set up software center 
May 07: Malaysia Helicopter Services unit to build Vietnam office block 
May 07: Industrial production grows 13.8% in four months 


Vietnam: Over 120 economic cases tried so far this year

HCMC (SGT) -- The Economic Court under the HCMC People's Court handled
129 economic cases in the first four months of 1997, including three
bankruptcies.

The remainder were contract disputes between domestic individuals and
enterprises or between Vietnamese individuals or enterprises and
foreigners or foreign companies. Only 12 cases were brought to court
while the remainder were conciliated.

Three bancruptcy cases were also conciliated so that debtors and
creditors could seek solutions by themselves to overcome the
consequences.

According to Mr. Pham Xuan Tho, presiding judge of the Economics
Court, one obstacle in handling disputes on economic contracts is that
the Ordinance on Economic Contracts issued in 1989 does not identify
contract relations between individuals who have registered to do
business and private enterprises to be economic contracts.

In addition, the regulated duration of six months is too short to file
a lawsuit against economic violations, said Mr. Tho.

As a consequence, many enterprises, especially State-owned, lost
rights to file a legal action since they lacked time to prepare
documents, he added.

All the 129 economic cases mentioned above were handled by the only
five judges of the Economic Court.
                 ___________________________________


Nike's Enemies: The Usual Suspects

By GREG RUSHFORD

What's a CEO to do?

Nike, Inc., the world's leading athletic-shoe manufacturer, has been
accused by labor and human rights activists of running sweatshops in
China and Indonesia, and of abusing female workers who make Nike
sneakers in Vietnam. The activists equate Nike's famous "Swoosh" logo
with exploitation. It's hardly the image that Nike Chairman and CEO
Philip Knight seeks.

What's going on? Why is U.S.-based Nike, and not, say, Reebok or
Adidas, being demonized? And how is Nike--which is adamantly proud of
its employment practices--defending itself? More pointedly, has Nike's
public-relations helped or hurt?

The answer to the latter question, I believe, is that Nike, like so
many other corporations under fire, sometimes seems to be its own
worst enemy when it comes to getting out its side of the story.

This is particularly unfortunate, as a careful scrutiny of the litany
of complaints brought against the company suggests that Nike really is
the progressive and humane employer it claims to be. Despite the
nagging problems that one would expect when a company employs some
200,000 contract workers world-wide, impartial reporters who have
looked into Nike's operations have mainly found them to be clean. New
York Times reporter Seth Mydans, for example, after visiting a Nike
plant in Tangerang, Indonesia, last August, quoted one young woman who
described her job as "boring, but it's better than being unemployed at
home."

So why is Nike a target? Because it is "the biggest," says Medea
Benjamin of San Francisco's Global Exchange, which is part of a loose
network of some 15 organizations world-wide that aims to bring as many
bodies as possible into the streets for an international protest day
against Nike on Oct. 18. The Beaverton, Oregon-based Nike holds about
37% market share of athletic shoes, which are sold in more than 18,000
stores in some 100 countries.

To its critics, Nike is also the "baddest." They are not much
impressed that here is a company that Philip Knight began in his
garage in the 1960s and is now so famous it doesn't even have to put
its name on its letterhead--just the swoosh. Mr. Knight makes $1.8
million a year and is one of the world's richest men; he pays Michael
Jordan of the Chicago Bulls $20 million a year; golf wunderkind Tiger
Woods got a $40 million contract, and that was before he won the
Masters. Mr. Knight wrote in the introduction to Nike's 1995 annual
report that it had been "the kind of year that makes you want to spike
the ball in the end zone, take a victory lap pointing to the sky, do a
360 slam dunk, hang by the rim, and do a little trash talkin' into the
next fiscal year."
  _________________________________________________________________

To the guerrilla warriors who love to snipe at Nike, the company's
stream of press releases, boasting that it was the first in the
industry to establish a Code of Conduct, that it has worked with a
White House task force to sign an anti-sweatshop accord, that it has
hired former Atlanta Mayor Andrew Young to inspect its Asian
operations, mean nothing.
  _________________________________________________________________

While Mr. Knight had the opportunity to do some more trash talkin' in
1996--Nike revenues shot up 35.9% to $6.4 billion--to the activists,
his success (and in-your-face attitude) amounts to an invitation to do
a little trashing in return. And the anti-Nike folks have the means to
do exactly that.

Funded variously by labor unions, the religious left, and by a
"grass-roots" donor base, the anti-Nike protesters are the younger
brothers and sisters of the "peace and justice" activists who in
earlier decades opposed the Vietnam War and supported the Sandinistas
against the Contras--and as subsequently proved, against the
voters--in Nicaragua.

There is the Vietnam Labor Watch, founded by a Vietnamese-American
businessman who has obtained much of his information from the
Vietnamese General Confederation of Labor, an arm of the Hanoi
government. The Washington, D.C.-based Campaign for Labor Rights,
which is part of the pro-Sandinista Nicaragua Network, also receives
some funding from the California Local 536 of the Service Employees
International Union. Unite!, the Union of Needletrades, Industrial and
Textile Employees, is there to lend a hand when one of the groups
needs it. In Canada, Development and Peace is funded by the Canadian
Catholic Church, the Canadian Autoworkers Union, and the Alberta
Federation of Labor. There is also the East Timor Action network,
which works closely with the U.S.-based Press for Change to blast away
at Indonesian labor practices. In Sweden there is the Fair Trade
Center . . . and so on. In Portland, Oregon, one group gets to the
bottom line by calling itself Justice Do It Nike.

Apart from the fun of it, the activists are driven by their economic
philosophy, and also by a moral judgment. Trim Bissell of the Campaign
for Labor Rights explains the economics this way: "The policies of the
World Bank and IMF, although they claim to be pro-development, have
destroyed these economies so transnationals can come in and take
advantage of the cheap labor." In Vietnam, Mr. Bissell adds that the
CIA and the U.S. military have also pitched in.

The critics' moral judgment comes down to this question: Is it right
for Nike to pay Philip Knight, Michael Jordan and Tiger Woods millions
of dollars, while the young women who make Nike sneakers in Asia earn
about $2.00 a day?

That's the wrong question to most mainstream economists. Paying $40 to
$60 a month in Vietnam is two to three times that country's national
per capita income of $250, points out Russell Roberts, an economist at
Washington University's School of Business in St. Louis. Economists
like Mr. Roberts also link Nike's capital to vastly improved living
standards in the countries in which it has operated: first Japan, then
Korea, Taiwan, and now newly developing countries like China,
Indonesia and Vietnam.

"Nike's arrival usually corresponds to an economic boom, while its
departure usually signals that the time has arrived for a country to
move up the development scale," wrote Li Tong and Robert Zielinski of
Jardine Fleming Research's Singapore office in a recent paper. Messrs.
Tong and Zielinski coined a phrase for the wave of prosperity that
Nike has helped create across Asia: the Nike Indicator.

While Nike is good at economics, it isn't so adept at public
relations. Last year, Nike officials put their hands in front of CBS
correspondent Roberta Baskin's camera, and wouldn't let her into one
of their factories in Vietnam. Ms. Baskin then trashed Nike,
interviewing a group of women who had been slapped by a Korean
supervisor (Nike's five plants in Vietnam are run by Korean and
Taiwanese subcontractors). Nike had actually dealt with the abuses
before the U.S. journalists showed up. But the company sure looked
guilty.

Nike then created more bad press for itself by making the same mistake
with Thuyen Nguyen, a 33-year old New Jersey businessman who went to
the United States from Vietnam in 1975. Disturbed by the CBS
broadcast, Mr. Nguyen flew to Vietnam to investigate for himself.
Although Mr. Nguyen reports that Nike officials took him on a plant
tour, he became frustrated when he was asked to stay away from the
press.

So Mr. Nguyen hooked up with the official Vietnamese General
Confederation of Labor officials, who made sure he interviewed
disgruntled workers. He also gleaned anti-Nike reports from Vietnamese
publications like Worker magazine. "When I gave my report to Nike, I
got little response," says Mr. Nguyen, who has now launched Vietnam
Labor Watch. "So I called [New York Times columnist and passionate
Nike critic] Bob Herbert, because Nike was telling me Bob Herbert is
dishonest."

Predictably, columnist Mr. Herbert, an honest Manhattan liberal whose
literary juices flow when the subject is corporate greed, ripped Nike
in a column. Mr. Herbert passed along Mr. Nguyen's most damning
finding: that a Taiwanese supervisor had made 56 women employees run
twice around a 1.2-mile factory perimeter as punishment. Nike's "boot
camp," Mr. Herbert dubbed it.

Nike officials protest vehemently that Mr. Nguyen's "discovery"
actually had already been reported to them and dealt with. The
Taiwanese supervisor is being prosecuted. The same executives,
however, would not return repeated telephone calls to discuss their
public-relations strategy, which couldn't be better designed to give
Nike critics more ammunition.

To the guerrilla warriors who love to snipe at Nike, the company's
stream of press releases, boasting that it was the first in the
industry to establish a Code of Conduct, that it has worked with a
White House task force to sign an anti-sweatshop accord, that it has
hired former Atlanta Mayor Andrew Young to inspect its Asian
operations, mean nothing. To the activists, Nike wants to have it both
ways. While the company pays hired guns like Mr. Young big bucks to
clear its name, other critics--Jesse Jackson, for instance--aren't let
anywhere near Nike factories. Cover-up, the activists complain.

True, leftists like Mr. Jackson would not be satisfied even if Nike
doubled the wages it pays its Asian workers. But what Mr. Knight must
do is forget p.r. gimmicks and just slam-dunk his critics with
economic facts.
  _________________________________________________________________

Mr. Rushford is editor and publisher of the Rushford Report, a
Washington D.C.-based newsletter on trade politics.
                 ___________________________________


Thailand: Thai Glass To Build 900M-Baht Plant In Vietnam 

BANGKOK (DJ) -- Thai Glass Industries PCL (P.TGI) will build a
900-million-baht plant to produce glass containers in Vietnam, an
official at the company said Wednesday.

The plant is expected to begin production by late 1998, with a
capacity of up to 200 tons of glass containers a day, said Somchai
Somsuksawadkul, TGI accounting manager.

Somchai said the company chose Vietnam as a new production base
because it's less costly to expand there than in Thailand. 'It's a
combination of cheaper labor, cheaper raw materials and much less
competition,' he said.

The company currently operates two glass-container production plants
in Thailand with a combined capacity of 1,655 tons a day.

The company recorded a net profit of 537 million baht last year
compared with 508.5 million baht in 1995.

$1 = 26.06 baht (Bank of Thailand midrate)
                 ___________________________________


Thailand Jan-April Rice Shipments Dn On Yr; Vietnam's Up 

SINGAPORE (Dow Jones)--Thailand's January to April rice shipments
totaled 1.459 million metric tons, down 23% from 1.888 million tons in
the same period a year earlier, according to statistics from the Rice
Exporters Association of Thailand.

Vietnam's January to April rice shipments rose about 7.2% to 746,076
tons, from 695,767 tons shipped out the same period a year ago,
according to statistics released late Wednesday by the Overseas
Merchandise Inspection Co. Ltd., a Japanese cargo surveyor in Ho Chi
Minh City.

Vietnamese exports were higher in March and April than in the first
two months of the year, largely because shipments to such destinations
as the Philippines, Indonesia and Cuba.

Almost 39%, or some 115,726 tons, of total March shipments of 297,640
tons went to the Philippines. In April, shipments to the Philippines
took up 45%, or 132,800 tons, of total April shipments of 295,027
tons.

Thailand is the world's largest rice exporter, with forecast 1997
exports at 5.0 million to 5.2 million tons, trade sources said.
Vietnam, the world's second-largest rice exporter, is seen by the
trade exporting 2.75 million to 3.0 million tons this year.

-By Joyce Teo 65-421-4825
                 ___________________________________


S. Korea LG Offers Finance Plan For Vietnam Refinery 

SINGAPORE (DJ) -- Vietnam's recent decision rejecting foreign
ownership of the country's first oil refinery has gained a measure of
support with a new financing proposal by Seoul-based LG Group (Q.LGG),
according to industry sources familiar with the project.

The company, a member of the second and most recent failed refinery
consortium, recently submitted a proposal to state-owned Vietnam Oil
and Gas Corp. (Petrovietnam). The proposal outlined ways to raise
foreign finance if Petrovietnam chooses to act as sole or majority
owner of the oil refinery, Vietnamese and foreign industry sources
close to the project told Dow Jones late Tuesday.

The move appears to support LG's statements that it wanted to continue
working with the Vietnamese government on the refinery despite the
February collapse of the six-member consortium after Vietnamese
officials rejected tax breaks and other investment incentives. Other
consortium partners were Malaysia's Petroliam Nasional Bhd. (Petronas)
(P.PET); Conoco Inc. and Stone & Webster, both of the U.S.; Chinese
Petroleum Corp. and Chinese Development Corp., both of Taiwan.

The LG financing plan would supplement a newly completed feasibility
study, conducted by Petrovietnam, detailing four options for
configuring the US$1.5 billion oil refinery. A government
ministry-level group is reviewing the feasibility study.

The most attractive option, according to the feasibility study, would
be to construct a 6.5-million-ton-per-year plant, with a 13.8% rate of
return and 10% net present value over the life of the project, local
newspapers have reported.

The facility, originally estimated to cost $1.3 billion to $1.5
billion, is slated to be built in Dung Quat, a remote fishing village
on the central coast, about 900 kilometers north of Ho Chi Minh City.

A Seoul-based LG spokesman wouldn't confirm that the firm had
submitted a proposal. 'LG understands the desire of the (Vietnamese)
officials to develop that region of the country,' he said. 'We want to
frame our proposals to those ends. We're going to try to play a role
(in the refinery) however it benefits both parties.'
                 ___________________________________


HCMC to set up software center 

HCMC (SGT) -- HCMC has approved the project to establish the first
center of information technology (CIT) specializing in producing
software and assembling hardware under the semi-knock down (SKD) form
in the period 1997-2000.

In the second stage (2001-2010) the center will produce software only.

The center is expected to be located on an area of 4,000 square meters
on Truong Dinh Street, District 3. It will receive some VND16 billion
from the city budget to build the office and install equipment,
reported Thanh Nien newspaper.

Seven informatics companies - PTBT, Scitec, Quantic, Lac Viet,
Cinotec, Tin Viet, and Nortel (Canada) - are expected to attend the
center. CIT will recruit 200-300 IT engineers.
                 ___________________________________


Malaysia Helicopter Services unit to build Vietnam office
block 

HANOI (AFP) - A subidiary of Malaysia Helicopter Services has teamed
up with Technology Resources Sdn. Bhd. and a Vietnamese partner to
build a 40 million dollar office block in Ho Chi Minh City, a company
official said Wednesday.

The 27 storey office block will be built in the heart of the former
Saigon directly across from the French built opera house, said Jimmy
Ong, chief representative in Ho Chi Minh City of Metroplex Bhd, a
wholly owned subidiary of Malaysia Helicopter.

Metroplex will take a 40 percent stake and Technology Resources 20
percent stake in the project which was signed last week and is
expected to receive a 40 year licence from the Ministry of Planning
and Investment next month, he said.

Local partner Saigontourist, a company controlled by the Ho Chi Minh
City municipality, will take the remaining 40 percent stake.

Ong said the office tower, which is to be named "The Piano", will be
the first Malaysian commercial property development company in
Vietnam, and will take about two years to build.

Technology Resources is a Malaysian property development company
controlled by Dick Chan, and is also building a Casino in Subic Bay in
the Philippines
                 ___________________________________


Industrial production grows 13.8% in four months 

HANOI (SGT) -- The first four months of 1997 saw an industrial growth
rate of 13.8% compared with the same period last year, according to
statistics from the General Statistics Office.

In this period, industrial production grew 11.6% in the State sector;
10.6% in the non-State sector; and 21.9% in the foreign investment
sector.

Major industries attained an average growth rate of 10% over the same
period last year; in fact, the electric power output reached some 5.9
billion kWh, up by 13%, and the oil industry turned out around 3.17
million tons of crude oil, increasing 22.3%.

The turnout of such products as cement, tin ingots, diesel machines,
electric motors, soaps, detergents, beer and edible oils also
increased between 13% to 35% against the same period last year.

Domestic consumer ceramic products have gained a competitive edge over
imported products, so total sales in the first four months rose 76.7%
over the same period of 1996.

However, large amounts of domestic products have been stockpiled as
the market has been overwhelmed with a variety of industrial goods
imported into the country through many channels.

By early April, the country had had more than 90,000 tons of laminated
steel, some 530,000 tons of cement and 15,000 tons of paper in stock.

Due to fierce competition, centrally owned electronics and telecom
equipment enterprises had to slow down their production by half and
the output of electric fans dropped about 40%.

Production of canned condensed milk, garments, textiles, tobacco,
monosodium glutamate, electric and electronic appliances, sodium
hydrate, batteries and pesticides represented between 67.3% to 99.6%
of the same period of 1996.

The first four months only saw an industrial growth rate of 10.9% in
the State sector, but the figure was 12.5% in the first four months of
1996. Industrial enterprises under the Ministry of Industry accounted
for 70% of the country's production value, but their growth reached
8.7% only.