Thứ Sáu, 29 tháng 7, 2016

Textile Industry in Vietnam

BY Juna Mèo IN , , , No comments

Vietnam textile industry for many years has always been one of the major export sectors of Vietnam. With the development in technology, the number of skilled worker is growing along with many preferential policies from the Government, the textile industry has obtained encouraging results, creating the value of goods, ensuring domestic demand and export.

1.Overview of the industry
According to the General Department of Customs, in 2014, the value of exports textiles reached 20.91 billion dollars, increasing 16.6% compared to 2013. The value of textile exported was the second largest export industry in Vietnam.
Vietnam’s textile industry has a high production capacity: 4,424 enterprises (as of 31/12/2013) with 2.5 million workers, growth rate of 14% annually. There are 1.2% of enterprises reaching $100 million export revenue, 3.25% of them reaching 50 million and 30% reaching over $1 million. There been several textile products including 8000 tons of cotton fiber, yarn 900 thousand tons, 1.5 billion m2 fabric. Localization ratio of the whole industry was 50% in 2014.
Export capacity of the textile industry is also very impressive. Particularly in 2014, the export value reached 20.91 billion US dollars, accounting for nearly 14% of total turnover exporting ones in the country­­ – No. 1 export industry of Vietnam until 2012, No. 2 in 2013 onwards (after the mobile phone). Vietnam is the 4th largest exporting country, accounting for 4.92% of global textile exports in 2014, after China, Bangladesh, Italy.
Vietnam’s textile sector has yet to master generating raw material. The high-quality raw material required depends heavily on importing (around 60-70%). Mainly imported raw materials are from China, Taiwan and Korea. Vietnam’s textile industry has currently imported 90% of raw cotton, 100% synthetic fibre and 80% cotton fabric.
According to research by the Ministry of Labour, every $1 billion of Vietnam textile export created extra 250,000 jobs. Currently, Vietnam has a population of over 90 million people which 49% of the population of working age worked in the textile industry. Moreover, the labour cost in Vietnam is relatively low compared to many countries in the region. The advantage of the lower labour cost will resulted in lower production cost, thus being price competitive. However, in this sector, there is a shortage of skilled labour leading to difficulties to develop the industry.
2.Opportunities for textile industry
TPP is a great opportunity for many industries including textile. According to economic experts, TPP will have a huge influence in the global textile industry. TPP opens investment opportunities (FDI) into developing materials and supporting industries. When joining the TPP, textile tax rate reduced to 0% which indicates a huge profits for Vietnam’s textile sector.
Besides, FTAs (The free trade agreements) also opens up further export opportunities for Vietnam’s textile industry to the market European Union, Korea, Asian Economic Union – Europe …  Vietnam will benefit from free tariff agreement from EU. Besides, the Vietnamese enterprises will be supported in terms of access to high technology from other countries, thus enhancing value of products.
3.Challenges
Other than opportunities, the textile industry will be facing many challenges. The domestic textile enterprises are mainly operating in small and medium scale with low capital investment and financial resources, limited technology, equipment and innovation capabilities. This lead to inability to achieve economic efficiency and compete with other countries. After all trade agreements take effect, Vietnam’s textile industry must meet strict rules and requirements such as origination of raw material (fabric). Meanwhile, most of raw materials (fabrics) was imported from other countries such as China (not a member of TPP). Therefore, if Vietnamese enterprises do not use raw materials from Vietnam or other countries in the TPP, it will be difficult for them to enjoy free tariff when exporting to the US and other countries in the TPP. Therefore, Vietnamese enterprises are highly recommended to learn about TPP and other free trade agreements. Besides, Vietnamese enterprises should prepare for qualified workforce, equipment and new technologies and intellectual property. The state and agencies functions have created specific guidance on the provisions of the tax, customs to help Vietnamese enterprises to utilise export opportunities with the advantages of tariff.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation. 
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Tư, 27 tháng 7, 2016

Private Hospital Projects Attract Foreign Investment

BY Juna Mèo IN , , , , No comments

After many domestic investors failed to investin the construction of private hospital, from 2014 until now, especially in the first months of 2016, there were many foreign investors interested in this area.

Recently, a US delegation composed of more than 40 representatives from US leading hospitals, pharmaceutical companies, medical equipment companies, research institutions and medical training institutions came to offer Ho Chi Minh City (HCMC) leaders, as well as with the 175 Military Hospital to join hands and develop the private health sector under the health socialization policy of HCMC till 2020.
According to the chairman and founder of the worldwide health service network company, they want to invest in Vietnam medical sector. If so, in addition to investment in infrastructure and equipment in the public – private cooperation model, investors also need to invest in manpower training and hospital management model to operate more efficiently.
According to the Director of the HCMC Health Department, the city is having a lot of large projects that need the cooperation of both domestic and foreign investors such as the Health Complex in Tan Kien, Binh Chanh District, with many projects such as the City Children’s Hospital, Hospital of Otolaryngology campus 2, Hematology and Blood Transfusion Hospital, Oncology Hospital, Pham Ngoc Thach University of Medical campus 2…
The Government of Vietnam is conducting the socialization schedule  in the medical field. In fact, the total health expenditures of 93 million people in Vietnam now accounts for 5.8% of GDP, the highest in ASEAN, which is said to become the magnet for investors in this market.
In 2016, many foreign investors such as Bumrungrad Hospital Corporation (Thailand) and Lippo Group (Indonesia) have expressed their intention to develop hospital chain in Vietnam. This is considered a good time to invest in Vietnam health sector.
In a recent meeting with leaders of Vietnam Government, Temasek Corporation (Singapore) said that in the coming time, this corporation wish to promote investment activities in Vietnam, in which they will mainly invest in health sector by building private hospitals.
Earlier, in January 2014, Shangrila Corporation of Malaysia has invested to build Thanh Do Hospital in Binh Tan district, HCMC. The hospital has 320 beds, 21 clinical and subclinical specialties such as obstetrics and gynecology, pediatrics, surgery, cardiology, otolaryngology, ophthalmology, urology, cancer, hepatobiliary, digestion… Until June 2015, the hospital has announced to change their name and logo into City International Hospital (CIH).
At the beginning of 2016, the investors in the health sector continues to surprise when VOF Investment Fund (managed by VinaCapital) announced to takeover 75% stake in Thai Hoa International Hospital in Dong Thap province. The amount of money that VOF invested here is about 10 million USD.
According VOF, in the coming time, the Fund will continue to seek investment opportunities in the healthcare sector, including investment opportunities in equitized public hospitals if they feel attractive enough.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation. 
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Hai, 25 tháng 7, 2016

TRADE PROMOTION IN THE INTEGRATION PERIOD

BY Juna Mèo IN , , , , No comments

In the past 5 years from 2011 to 2015, trade promotion activities at home and abroad have achieved much progress, contributing significantly to the growth of the country’s export. However, when Vietnam integrates deeper into the world market, the role of trade promotion will become more significant.

In recent years, trade promotion has been implemented uniformly and efficiently, maximizes the resources at home and abroad to support the businesses and contribute to the economic and social development of the country.
Typical is the national trade promotion program. With the support from the program, the presence of Vietnam export products in many traditional markets such as the US, EU, China, Japan, South Korea is expanding. At the same time, the program has supported the business to come back to such markets as Russia and Eastern Europe, strengthening the operation in Myanmar, Laos, the Middle East, Africa and Latin America…
According to statistics, the activities of the national trade promotion program in the period of 2010 – 2014 have attracted the participation of more than 21,000 businesses. In particular, the companies have directly deal and signed contracts with a total contract value of export goods and sales reached nearly 5.3 billion USD and more than 1,000 billion VND.
The participation in the multilateral free trade agreements such as the Trans-Pacific Partnership (TPP) and bilateral agreements, in addition to the benefits that it can bring to the export of strategic goods Vietnam, the domestic manufacturing sector is forecasted to face with negative impacts if there are no timely and appropriate measures to support.
In order to effectively effectively support companies and take advantage of the opportunities offered by the new generation FTAs, Ministry of Industry and Trade has directed the relevant agencies to deploy more practical trade promotion activities, focusing on activities to tapping and opening the markets that Vietnam has signed and under FTA negotiation.
In particular, focus on supporting the export promotion in overseas market with such activities as: Organize and participate in specialized trade fair abroad, organize trade delegations to help maintain export turnover in the key markets, expand export market in new and potentialmarkets.
Promote export through activities organized right in Vietnam: Organize international exhibition in Vietnam; organize international conference; organize and welcome the foreign delegations to Vietnam; mobilize the commercial counselors in countries around the world to introduce business opportunities, connect businesses and provide updated market information for businesses.
Coordinating agencies, related organizations and multinational corporations bring Vietnamese goods to international supermarkets: Organize Vietnam goods week in supermarket system in France, Japan and Korea…
Improve the performance of the trade promotion office that have been established in the United States and China; completing the establishment of trade promotion offices in China; finishing the scheme to set up trade promotion office in foreign country.
In order for the trade promotion activities to operate effectively and bring good opportunities for businesses, apart from the support of the State, companies need to improve technological content, added value to their goods, building and developing brands and participate in global supply chains.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation. 
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Hai, 18 tháng 7, 2016

SUSTAINABLE DEVELOPMENT IN VIETNAM

BY Juna Mèo IN , , No comments

The sustainable development objectives including economic, social development and environment protection have been integrated into national priority development together with economic growth objective.

With a stable GDP and economic growth, improvement of education, Vietnamese citizens have gained more knowledge about gender quality, environmental and other social issues, thus, creating campaigns to support collective action. For example, the campaign collecting garbage along beaches in Vietnam attracted more than 1000 students to participate in which indicated collective action to mitigate effect of disaster and climate change.
Vietnamese government has significantly improved the rate of hunger eradication, poverty reduction, population, job creation, education and healthcare. Particularly, in 2014, total state budget for hunger eradication and poverty reduction were more than 34 billion VND. Thus, the poverty rate took a nosedive from 14.2% in 2010 to 1.8-2% in 2014, proving average reduction of 2% per year national wide.
The state fund for environmental protection has been increased, thus the policies for environmental protection has put into regular operation. By executing tax exemption for environmental friendly enterprises, businessesin Vietnam have been more aware of coordinating environmental protection policies into long term vision and mission.
Vietnam takes part in international agreement to show commitment to sustainable development such as: WTO, United Nation Framework Convention on Climate Change, United Nation Convention to combat desertification, the convention on International Trade in Endangered Species of Wild Fauna and Flora…
Challenges of sustainable development in Vietnam
There have been some challenges in Vietnam when implementing sustainable development policies. An increase in natural disaster, degenerated natural resource (water and biodiversity resources), wasteful and ineffective production and consumption are causing huge destruction to various local communities.
Even though there have been some supporting policies for enterprises in Vietnam to implement sustainable development policies, they have not obtained full awareness of the link between good environmental, social, and governance performance and the ability of companies to be profitable and survive in turbulent times. Therefore, most of the firms succeeded in promoting sustainable development practices are international businesses.
 Sustainable development in business
Since Vietnam takes part in international trade agreements, there will be more international and institutional investors need the information of material environmental, social and governance information about company performance to decide whether to make investment decision.
Sustainable development of the business should be proven by social factors (employee compensation, benefits, staff turnover, safety practices, diversity and local community) and environmental factors (energy efficiency, GHS emissions, biodiversity conservation, water usage, natural resource use, waste to energy and recycling practices). These factors are crucial for investors as they indicates how the company takes into account risks, opportunities, management approach, stakeholder value and long term development.
Sustainability report has been strongly recommended by Vietnamese government. Vietnam Brewery Ltd is one of a few leading companies taking this report seriously. Their report in 2014 stated that the company switched from diesel to biomass as boiler fuel, reducing direct CO2 emissions as a result. In addition to reducing our carbon footprint and mitigating the effects of global warming, the local community has also benefitted from the programme with an additional income from the sale of rice husks. The company also highlighted the code of conduct which allowed the employees to voice their opinions. There have been also other big cooperation taking part in the trend for example Bao Viet Corporation, Vinamilk, Hau Giang Pharmacy…
In conclusion, in order for enterprises in Vietnam to actively engage in sustainable development and voluntarily adopt sustainability as common practice, Vietnamese government should take more urgent actions.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation. 
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn




Thứ Sáu, 15 tháng 7, 2016

FDI WAVE FROM THE UK INTO HO CHI MINH CITY

BY Juna Mèo IN , , , , , No comments

UK businesses are gradually becoming the largest investors inVietnam.
The southern key industrial zone (SKEZ) including Ho Chi Minh City (HCMC) and neighboring provinces such as Binh Duong, Dong Nai, Long An and Ba Ria – Vung Tau.

SKEZ include 106 active industrial zones with a total area of 33,500ha. Those industrial parks have the advantage that lie near the highway, intercity road, seaport and international airport.
HCMC is the economic center of SKEZ, therefore this is the area that always receives the largest amount of FDI projects.
According to Savills Vietnam, in the first half of 2015, UK businesses have invested the most in HCMC, accounted for 59% of total FDI capitals, followed by investors from the British Virgin Islands (15%) and South Korea ranks 3rd(10%).
HCMC has 16 active industrial parks, operating with 2,300ha leased land, attracted 425 million USD from FDI, increase by 50% compared with 2014.
Currently, HCMC has announced plans to open 7 new industrial parks, with a total area of around 2,000 ha to welcome FDI inflows in the textile, service and food processing industries.
Moreover, in recent years, HCMC has adopted preferential tax policies to encourage new businesses operating in the high-tech industry and related scientific disciplines.
Especially in infrastructure development, in order to welcome foreign investors, infrastructure of the city has been growing rapidly with many underway projects, such as the HCMC – Long Thanh highway, the metro 1 and the belt roads of the city.
In early 2016, two key roads will begin construction includes the belt road no.3 connecting Nhon Trach District, Dong Nai and Ben Luc – Long Thanh highway.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Tư, 13 tháng 7, 2016

VIETNAM: THE POTENTIAL DESTINATION FOR VENTURE CAPITALS

BY Juna Mèo IN , , , , No comments

If we see the business, the attention of Venture Capitals (VCs) and foreign investors are the indication then Vietnam is emerging as a potential environment for the startup operation.


Besides the investment funds that have been presented in Vietnam as IDG Ventures Vietnam, a number of new VCs have joined the Vietnam entrepreneurship ecosystem and are very optimistic about the ahead opportunities.
On August 2015, the Captii Ventures owned by Captii Corporation has invested a sum of 6 numbers to the startup OnOnPay phone recharge. This represents the first venture investment of Captii in Vietnam.
Factors attracting investors here are the demographic advantages and business models that can be replicated. According to Techlist.asia, the startup figure in Vietnam has risen to 1,400, bringing this country becomes the 3rdlargest startup ecosystem in Southeast Asia after Singapore and Indonesia.
With a population of 90 million people who are in the process of economic growth, young population structure, emerging middle class and the rate of Internet user is increasing rapidly, especially mobile phone, Vietnam is in the beginning phase of a very exciting cycle.
Moreover, Vietnam is a large, young and growing rapidly economy, the technology index such as the ratio of using the Internet and smart phone are in large-scale, the leading founder generation have achieved success and demonstrate the potential of the talent and market of Vietnam.
Compared to other Southeast Asian countries (Indonesia, Thailand, Malaysia, Singapore, Philippines and Vietnam), Vietnam has strong advantages in the available technique human resources, energy, resources and potential growth the market.
Moreover, the new policy on foreign investment has entered into force on July 1st 2015 with more freedom for foreigners to own real estate in Vietnam and simpler procedures for projects or portfolios.
In the 3 areas that Captii Ventures is focusing on that are market, digital media and apps for business, they will participate more actively in at least two areas that are market and apps for business.
Not only with the VCs, Vietnam startup is also attractive to other foreign companies such as Yello Mobile from South Korea, the company has invested in CleverAds advertising company and Websosanh – the price comparison site.
Garena, a Singapore’s internet company has invested Series B for Foody, startup locations that in the same month continued to receive Series C investment from Tiger Global Management – US venture capital fund.
Transcosmos, a software manufacturing company based in Tokyo, had previously acquired a 30% stake in Hotdeal e-commerce platform in a deal signed on August 2015.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Hai, 11 tháng 7, 2016

TPP WILL CREATE BREAKTHROUGH FOR VIETNAM’S COMMERCIAL REAL ESTATE SECTOR

BY Juna Mèo IN , , , , No comments

On October 5th, the TPP agreement has finished negotiation. According to experts, the signing of TPP will expand the opportunity for Vietnam’s economy in general and real estate market in particular.

It seems that foreign real estate investors are more sensitive hearing than domestic investors in the anticipation of macroeconomic policy. The most recent example, funds from Japan and the United States are massively investing in the real estate market of Vietnam. These includes Creed Group (Japan) committed to invest 200 million USD into the An Gia Investment or the Global Emerging Market – GEM (US) has recently committed to pour 20 million USD into Hoang Quan real estate company.
Currently, there is a capital inflow from Japan landing in Vietnam. Many Japanese firms have invested in clean agriculture in Japan and some areas in the Northern of Vietnam to grow fresh vegetables and then export back to Japan. The Japanese are very closely following the TPP negotiation process so they also have investment plans in advance.
After the TPP was signed then what people expect the most is the commercial real estate market will develop better, which include industrial park, office, retail space…as a result of the shift of investment capital flows.
In order to leverage the special tax incentives and cheap labor cost in Vietnam, a lot of businesses in Japan, US had planned about moving factories from China to Vietnam and exported to Japan, US… The main industries that are shifting include textiles, phone manufacturers, automobile manufacturers…. The capital flow shifting will push up demand for commercial real estate.
When the foreign enterprises arrived in Vietnam, they will have to build factories, warehouses. On the other hand, they would create jobs, generate demand for ancillary and service industries. Thus, the system of services like hotels, trade centers, office rental and other services will develop as a result.
Thus, we can also expect M&A in the field of hotel, office, retail, including resort real estate will thrive in the future. Moreover, after the success of TPP, it will push up the industrial real estate market to develop.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Năm, 7 tháng 7, 2016

LOTTE WANTS TO OPEN 60 SUPERMARKETS IN VIETNAM

BY Juna Mèo IN , , , No comments

Vietnam’s retail market has the highest growth rate in the region, therefore Lotte expects to grow further through setting up more retail business or M&A activity in Vietnam.

South Korea is the largest investor in Vietnam with over 4,000 enterprises, total investment in Vietnam as of July 2015 is 32.8 billion USD.
Among South Korean firms investing in Vietnam, Lotte Mart is one of the corporations with the most powerful investment force and they are leading in a number of areas with the models of retail, hotel, cinema…
Mr. Hong Won Sik, CEO of Lotte Mart Vietnam said that Vietnam’s retail market has the highest growth rate in the region, therefore Lotte wants to invest more. The target is to open 60 supermarkets till 2020 and now they have opened 11 supermarkets in Vietnam.
Some of the current Lotte shopping centers have made a big impression on Vietnam consumers and the investment from Lottle makes it to be one of the biggest players on the retail landscape in Vietnam.
ANT Consulting is here to assist you from the outset; providing intelligence, information, management or support and administrative services that assist market entrance, and ensure efficient business start-up operation. 
We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Tư, 6 tháng 7, 2016

INVESTMENT IN WIND POWER PROJECT IN VIETNAM

BY Juna Mèo IN , , , , No comments

Wind power is one of priority sectors to develop in Vietnam. Vietnam Government has been given a lot of incentives as well as support for wind power development projects.

Wind power investment procedure in Vietnam
Step 1: Project location
Investment in wind power projects must be suitable with the development plans of wind power and electricity, which are approved by the competent authorities.
Investors are licensed the wind power investment and development permit for wind power projects that are on the list of approved national wind power and electricity development plans. Moreover, in terms of the projects which are not in the approved list, the investors are responsible to create its dossiers which will be added to the development plan and examined by Ministry of Industry and Trade and then by Prime Minister.
Step 2: Evaluate wind potential at selected location
It is necessary to install wind measurement masts (if they are not available on the project location) and implement the wind measurement at least one year.
Step 3: Pre-feasibility research and require adding the project to power development plan
If the project location has potential wind condition, the investors will make a report and submit to Ministry of Industry and Trade to add this project to the list of power development plan. The Ministry is responsible to consider the application and asks for Prime Minister’s approval (wind power is a new sector in Vietnam, so the procedure has not been issued yet. All wind power projects with large scale as more than 50 MW have to be approved by the Prime Minister). After the project has been approved, the application is submitted to Department of Planning and Investment where the project is located
Step 4: Make investment report (feasibility study)
After being approved, the investment report will be submitted to Ministry of Industry and Trade to evaluate and approve
Step 5: Signing power purchase agreement with EVN
Under the provisions of Decision No. 37/2011/QD-TTg, EVN is obliged to buy the entire power output of the wind power project. Agreement and finalize the signing of the power purchase contracts, connection, design metering systems. Currently, the standard power purchase agreement is still in the process of waiting for approval from the Government.
Step 6: Implementation of the project
When the technical design is completed and the investment report is approved by the competent authorities such as Department of Industry and Trade, Department of Construction, Department of Natural Resource and Environment and other relating departments.
Step 7: Construction
According to Decision 37/2011/QD-TTg, the investors are allowed to start the construction only when its investment certificate is granted, have the signed power purchase agreement with the power buyer, have connecting agreement with the power distributor; wind condition report is continuously recorded in 12 months. 
Policy framework relating to wind power supporting in Vietnam
Policies and incentive mechanisms of the Vietnamese Government for wind power sector are expressed through clearer legal policies clearer in recent times. Prime Minister issued Decision No. 1208/QD-TTg of July 21, 2011, approving the national plan for power development in the period 2011 – 2020 with consideration to 2030. In which expresses the goal of the Vietnam Government is to prioritize developing renewable sources for electricity production, increasing the proportion of electricity produced from 3.5% in 2010 to 4.5% of total power manufactured in 2020 and 6% in 2030.
The government’s commitment to renewable power sector in general and wind power sector  in particular is clearly indicated after Decision No. 37/2011/QD-TTg was issued on 29 June 2011 (taken into effect on 20thAugust, 2011) stipulating the mechanism to support the development of wind projects in Vietnam. Accordingly, the wind power projects enjoy preferential of capital, tax and fee.
– Mobilizing investment capital: Investors are allowed to mobilize capital in the form of permission from the organizations and individuals at home and abroad, has preferential investment credit under the existing legal provisions on investment credit and export gorvernment’s.
– Preferential of tax:
+ Import tax: The project to develop and use of renewable energy sources are exempt from import duty for goods imported to form fixed assets for the project; imported goods are raw materials, supplies and semi-finished products cannot be produced domestically and imported for production of projects as stipulated by the current legislation on export tax and import tax.
+ Enterprise income tax: The exemption and reduction of enterprise income tax for projects to develop and use of renewable energy sources is made as to projects in the field of investment incentives as stipulated by the current legislation on taxes.
– Incentives on land: The project to develop and use of renewable energy sources be exempted or reduced of land use fees and land rent as stipulated by the current legislation applicable to projects in the field of incentives invest.
– Priority is given to research related to the development and use of renewable energy resources in the field of scientific development and technology and development of high-tech industry; allocate funds from the fund to support scientific studies and technology in the pilot project, the project of industrialization for development and use of renewable energy, promote technological improvements relating to the development and use of renewable energy, reduce production costs of renewable energy products and improve product quality.
According to Decision No. 37/2011 / QD-TTg on the mechanisms to support wind power. In which, the buyer (EVN) is responsible for purchasing all electricity output from wind power project at the price of 1,614 VND / kWh (excluding VAT value added taxequivalent to 7.8 US cents / kWh) at the point of delivery of electricity. Electricity purchase prices are adjusted according to fluctuations in the exchange rate between VND and USD. In particular, the State shall support for the buyer the price of electricity at the price of 207 VND / kWh (equivalent to 1.0 US cents / kWh) for the entire output of electricity purchased from wind power plants through Protection Fund Vietnam environment. This means, the buyer or EVN only pay 6.8 US cents / kWh.
According to Decision No. 37/2011/QD-TTg on the mechanisms to support wind power. In which, the buyer (EVN) is responsible for purchasing all electricity output from wind power project at the price of 1,614 VND / kWh (excluding VAT, equivalent to 7.8 US cents / kWh) at the point of electricity delivery. Electricity purchase price will be adjusted according to the fluctuations in the exchange rate between VND and USD. In particular, the State shall support for the buyer at the price of 207 VND / kWh (equivalent to 1.0 US cents / kWh) for the entire output of electricity purchased from wind power plants through Vietnam Environment Protection Fund. This means, the buyer or EVN has to pay only 6.8 US cents / kWh.
ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-upoperation. 
We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn



Thứ Hai, 4 tháng 7, 2016

Trends in Trade Promotion Management

BY Juna Mèo IN , , , No comments

It's a familiar mantra, "Consumer goods companies spend 20 percent of their revenues on trade promotion -- 20 percent!" What might be said following that statement? "Tracking effectiveness and profitability is uncertain;" and "the majority of CG companies are still using spreadsheets as their trade promotionmanagement (TPM) solution."



While a few years ago these budgetary allowances and technical constraints were accepted as the standard, shifts in the marketplace and trends in the industry have brought TPM discussions to the table. Yet, even as additional products become available, and the value of successful TPM becomes more apparent, many CG companies are simply not investing in an outside solution.

Surveys reveal different aspects and statistics relating to the lack of use or prioritization for TPM solutions. In a study commissioned by MEI, Amplitude Research indicates that only 25 percent of companies purchase software from an external vendor. An AMR Research study shows that only 30 percent have a TPM solution in place, but that Excel is the largest TPM provider. Forrester says that 40 percent use a "home grown/Excel" solution. A recent survey by Consumer Goods Technology indicates that 36 percent of the companies responding are currently using a TPM solution, but 22 percent have no plans to evaluate or implement in the next two years.

Ask a few different people why CG companies are not using outside solutions, and you will get a few different answers. At the most basic level, TPM is still too new for businesses to understand what it is all about. Lisa Bradner, a Forrester Research analyst says, "Trade promotion management is still in its infancy. Our survey shows that many consumer products companies are struggling with how to track, report and execute trade promotions effectively internally and that they need to master that before figuring out how to manage it with their channel partners. Adding to that is a fundamental question of 'who owns the money?' That makes TPM an extremely difficult conversation for retailers and manufacturers to have."

Promotion Effectiveness
So if companies are having internal struggles with the nitty-gritty, perhaps a definition is necessary first. According to AMR Research, "Promotion effectiveness is the measurement of the results of a promotional activity based upon uplift, cost, margin, profit, revenue and account management considerations."

Early on TPM was viewed as a transactional execution process and was often limited to the accounts receivable management process. Then, a few years back, TPM transitioned into a process that involved collaboration with retailers and internal sales and operational planning (S&OP). And recently, there has been a move towards optimization across enterprise, shaping demand through measurement and the execution of promotions. (See Figure 1) Ironically, it may be precisely this move towards optimization, which while providing a greater benefit to companies, has, in effect, added to the complexity of TPM and contributed to the reluctance of adoption.

Gary Adams, solution principal II, consumer products integrated sales and marketing, SAP, explains, "Managing trade promotion dollars and events continues to draw a tremendous amount of attention from most consumer products manufacturers. Despite this trend, many of these same companies continue to struggle with purchasing and implementing a best-practice solution to solve this meaningful, yet complex, business process. Therein lies the dilemma. Understanding the complexity of each process that effects, or are effected by the trade-promotion dollar is crucial."

Jon Van Duyne, chief executive officer, CAS Americas agrees, "This move from transactional trade promotion management, as we have been accustomed to discussing it, to trade promotion optimization -- which also needs to include for this purpose demand side management-- has created the 'perfect storm of a business problem since so many parties, including marketing, sales, operations, finance and even general management are, by necessity, now involved." starting small CG companies need to use a "crawl, walk, run" tactic, starting out with fundamentals. Across functions, organizations have different goals for promotion effectiveness and its meaning depends on each perspective. Understanding this diversity is the first step in TPM assessment.

For example, if marketing tries to solve the problem with an application that tracks spend and sales, but operations uses a tool to understand lift and predict volume, they work independently and therefore, inconsistently.

"Organizational alignment is needed -- at a minimum -- when implementing a TPM solution, and requires coordination between sales, marketing, finance and IT. Given that within most organizations, there is no clear owner of TPM across these functions, it's often challenging to gain agreement to implement a TPM solution and build consensus on how the solution should be configured to support each business functions critical processes," says Mark Osborn, chief solutions and services officer, Gelco Information Network Inc., Trade Management Group.

Adams speaks to this as well. "To truly solve these challenges, a company must fully evaluate how sales, finance and operations (including production and logistics) are impacted by the budgeting, planning, selling, executing, validating, settling and evaluating of their trade promotions. By putting this road map together, companies can clearly identify the type of solution(s) required for implementation as they work toward effectiveness and optimization of trade-promotion dollars."

Van Duyne points out that leaders in this space recognize that the future is more about increasing effectiveness versus simply achieving efficiencies through enabling technology. He says, "In order to make this vision a reality, companies must look at people and processes in addition to systems." Fred Schroeder, chief executive officer MEI, also believes that internal issues play a big part in the slow pace of adoption, particularly internal collaboration and benchmarking. He suggests, "CG executive have to rethink long-standing activities and practices."

One of these practices is the use of Excel to track data. Companies need to jump this hurdle in order to leverage TPM, especially at a level that is more than simply transactional. Because this is the method "they have always used," because Excel is inexpensive and so accessible and already understood, many businesses simply stay with what they know.

Osborn explains, "From our perspective, the ongoing use of spreadsheets remains a significant opportunity for both TPM solution providers and the industry in general.  Despite the perceived benefits, spreadsheets are unreliable, subject to frequent and potentially significant errors, and unable to ensure auditable standards and adequate financial controls."

Sarbanes-Oxley, the controls to which he refers, has brought new scrutiny and regulation to the use of spreadsheets. Osborn and many others believe that this tool may fail to meet the requirements of the Act, with its full implications yet unknown.

MEI calls on the vendor community to grow the category mutually. Schroeder says, "When TPM is implemented right, it can have a big impact." He cites a study done by Hand Promotion Management that found an overall improved ROI (from 4 percent to 18 percent) in CG manufacturers that had implement advanced TPM and analytical tools.

The Bottom Line
The bottom line is that CG companies need to change the way they approach promotions. Rather than being overwhelmed at the comprehensive technology available to ensure effectiveness of spend, be brutally honest about what is required today; then consider possibilities for tomorrow.

If a transactional system is needed to track spend, reconcile deductions and manage the financial flow, then start basic. If the basics are already in place, then build on top of that foundation with more advanced planning capabilities, and ultimately move into promotion effectiveness and optimization that leverages more sophisticated analytics. But don't rely on spreadsheets to manage one of the largest and most important budget items most CG companies have.

It has always been challenging to track the ROI for marketing activities, but an enterprise-wide application that manages all aspects of promotions can certainly go a long way to ensuring success at the retail shelf.